Note 12 – Goodwill and Other Intangible Assets
The table below summarizes the changes in carrying amounts of goodwill and other intangibles, including core deposit intangibles, for the periods presented:
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | Intangibles |
| (Dollars in thousands) | | Goodwill | | Gross | | Accumulated Amortization | | Net |
| Balance at January 1, 2024 | | $ | 2,838 | | | $ | 600 | | | $ | (248) | | | $ | 352 | |
| Amortization expense | | — | | | — | | | (90) | | | (90) | |
| Balance at December 31, 2024 | | $ | 2,838 | | | $ | 600 | | | $ | (338) | | | $ | 262 | |
| | | | | | | | |
| Balance at January 1, 2023 | | $ | 3,988 | | | $ | 3,820 | | | $ | (2,189) | | | $ | 1,631 | |
| Reduction of goodwill and intangibles resulting from sale of Chartwell | | (1,150) | | | (3,220) | | | 2,133 | | | (1,087) | |
| Amortization expense | | — | | | — | | | (192) | | | (192) | |
| Balance at December 31, 2023 | | $ | 2,838 | | | $ | 600 | | | $ | (248) | | | $ | 352 | |
| | | | | | | | |
| Balance at January 1, 2022 | | $ | 3,988 | | | $ | 3,820 | | | $ | (1,504) | | | $ | 2,316 | |
| Amortization expense | | — | | | — | | | (685) | | | (685) | |
| Balance at December 31, 2022 | | $ | 3,988 | | | $ | 3,820 | | | $ | (2,189) | | | $ | 1,631 | |
Goodwill represents the excess of the purchase price over the fair value of acquired net assets under the acquisition method of accounting. Intangibles resulting represent customer relationships and trade name related to prior acquisitions. These items are amortized over four years and 10 years, respectively.
The table below presents estimated amortization expense for our other intangible assets (dollars in thousands):
| | | | | | | | |
| 2025 | | $ | 52 | |
| 2026 | | 40 | |
| 2027 | | 40 | |
| 2028 | | 40 | |
| 2029 | | 40 | |
| Thereafter | | 50 | |
| | $ | 262 | |
Goodwill and intangibles are evaluated for impairment if events and circumstances indicate a potential for impairment. No impairment charges were recorded for other intangible assets in any of the periods presented.
About Goodwill & Intangibles Disclosures
Goodwill and intangible asset disclosures reveal the premium paid in acquisitions and how management assesses whether that premium retains its value. Since goodwill is no longer amortized under US GAAP, the annual impairment test is the only mechanism that adjusts carrying values downward — making the assumptions behind that test critically important for investors.
Key signals: a history of goodwill impairments suggests management consistently overpays for acquisitions. Watch the gap between reporting unit fair value and carrying amount — when fair value exceeds carrying amount by less than 10-20%, a small decline in business performance could trigger a write-down. For finite-lived intangibles, examine useful life assumptions across customer relationships, technology, and trade names; aggressive estimates inflate near-term earnings. Compare total intangibles-to-total-assets ratios against peers to assess acquisition dependency. Rising goodwill as a percentage of equity can signal balance sheet fragility.