SR Bancorp, Inc. Goodwill & Intangibles Disclosure
Goodwill and core deposit intangibles resulted from the Company's acquisition of Regal Bancorp, which was accounted for under FASB ASC 805, Business Combinations. In accordance with ASC 805, the Company recorded $20.4 million of goodwill along with $9.1 million of core deposit intangibles. The intangible assets are related to core deposits and are being amortized over 10 years, using an accelerated method.
The changes in the carrying amount of goodwill and core deposit intangibles are summarized as follows:
|
|
June 30, 2025 |
|
|
June 30, 2024 |
|
||
|
|
(In thousands) |
|
|||||
Balance at beginning of period |
|
$ |
28,141 |
|
|
$ |
— |
|
Acquisition of Regal Bancorp |
|
|
— |
|
|
|
29,481 |
|
Amortization expense |
|
|
(1,433 |
) |
|
|
(1,340 |
) |
Balance at end of period |
|
$ |
26,708 |
|
|
$ |
28,141 |
|
Goodwill and Intangible assets at June 30, 2025 and June 30, 2024:
|
|
June 30, 2025 |
|
|
June 30, 2024 |
|
||
|
|
(In thousands) |
|
|||||
Goodwill |
|
$ |
20,417 |
|
|
$ |
20,417 |
|
Core deposit intangible, net of amortization |
|
|
6,291 |
|
|
|
7,724 |
|
Goodwill and intangible assets |
|
$ |
26,708 |
|
|
$ |
28,141 |
|
As of June 30, 2025, the amortization of the core deposit intangibles in future fiscal years is as follows:
|
|
Amount |
|
|
|
|
(In thousands) |
|
|
2026 |
|
$ |
1,167 |
|
2027 |
|
|
951 |
|
2028 |
|
|
774 |
|
2029 |
|
|
657 |
|
Thereafter |
|
|
2,742 |
|
Total |
|
$ |
6,291 |
|
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Sep 29, 2025 | Showing above |
| 2024 | Oct 16, 2024 | |
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.