OLD NATIONAL BANCORP IN
For the period ended Sep 30, 2024. Filed Oct 30, 2024.
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Sep 30, 2024 · Filed Oct 30, 2024
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Goodwill and Other Intangible Assets
NOTE 8 –GOODWILL AND OTHER INTANGIBLE ASSETS
The following table presents the changes in the carrying amount of goodwill:
| Three Months EndedSeptember 30, | Nine Months EndedSeptember 30, | |||
|---|---|---|---|---|
| (dollars in thousands) | 2024 | 2023 | 2024 | 2023 |
| Balance at beginning of period | $2,170,709 | $1,998,716 | $1,998,716 | $1,998,716 |
| Acquisitions and adjustments | 6,290 | — | 178,283 | — |
| Balance at end of period | $2,176,999 | $1,998,716 | $2,176,999 | $1,998,716 |
During the nine months ended September 30, 2024, Old National recorded $178.3 million of goodwill associated with the acquisition of CapStar. The increase in goodwill for the three months ended September 30, 2024 resulted from the measurement period adjustments related to updating the fair values of the assets acquired and liabilities assumed in the acquisition of CapStar. See Note 2 to the consolidated financial statements for additional detail regarding this transaction.
Old National performed the required annual goodwill impairment test as of August 31, 2024 and there wasno impairment. No events or circumstances since the August 31, 2024 annual impairment test were noted that would indicate it was more likely than not a goodwill impairment exists.
The gross carrying amounts and accumulated amortization of other intangible assets were as follows:
| (dollars in thousands) | GrossCarryingAmount | AccumulatedAmortizationand Impairment | NetCarryingAmount |
|---|---|---|---|
| Core deposit | $189,636 | $(89,825) | $99,811 |
| Customer trust relationships | 52,621 | (24,347) | 28,274 |
| Total other intangible assets | $242,257 | $(114,172) | $128,085 |
| Core deposit | $143,511 | $(72,940) | $70,571 |
| Customer trust relationships | 52,621 | (20,942) | 31,679 |
| Total other intangible assets | $196,132 | $(93,882) | $102,250 |
Other intangible assets consist of core deposit intangibles and customer relationship intangibles and are being amortized primarily on an accelerated basis over their estimated useful lives, generally over a period of 5 to 15 years. During the nine months ended September 30, 2024, Old National recorded $46.1 million of core deposit intangibles associated with the acquisition of CapStar. See Note 2 to the consolidated financial statements for additional detail regarding this transaction.
Old National reviews other intangible assets for possible impairment whenever events or changes in circumstances indicate that carrying amounts may not be recoverable. No impairment charges were recorded during the nine months ended September 30, 2024 or 2023. Total amortization expense associated with intangible assets was $7.4 million and $20.3 million for the three and nine months ended September 30, 2024, respectively, compared to $6.0 million and $18.3 million for the three and nine months ended September 30, 2023, respectively.
Estimated amortization expense for future years is as follows:
| (dollars in thousands) | |
|---|---|
| 2024 remaining | $7,238 |
| 2025 | 26,116 |
| 2026 | 22,474 |
| 2027 | 18,947 |
| 2028 | 15,598 |
| Thereafter | 37,712 |
| Total | $128,085 |
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