NorthEast Community Bancorp, Inc./MD/ Goodwill & Intangibles Disclosure
Note 10 - Goodwill and Intangible Assets
Goodwill and intangible assets at December 31 are summarized as follows:
| December 31, |
| December 31, | |||
| 2023 |
| 2022 | |||
(In Thousands) | ||||||
Goodwill | $ | — | $ | 1,310 | ||
Accumulative goodwill impairment |
| — |
| (1,110) | ||
Goodwill, net of charge-off | $ | — | $ | 200 | ||
As of December 31, 2023, the goodwill was eliminated along with the sale of Harbor West Wealth Management Group to a third party in December 2023. The sale resulted in a total of $138,000 loss recognized on the consolidated statement of income. The Company identified $451,000 in goodwill impairment during the year ended December 31, 2022.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2023 | Mar 28, 2024 | Showing above |
| 2022 | Mar 30, 2023 | |
| 2021 | Mar 30, 2022 | |
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.