Huntington Bancshares Incorporated Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

GOODWILL AND OTHER INTANGIBLE ASSETS

GOODWILL AND OTHER INTANGIBLE ASSETS

9 Months Ended

Sep. 30, 2015

Goodwill and Intangible Assets Disclosure [Abstract]

Business segments are based on segment leadership structure, which reflects how segment performance is monitored and assessed. We have five major business segments: Retail and Business Banking, Commercial Banking, Automobile Finance and Commercial Real Estate (AFCRE), Regional Banking and The Huntington Private Client Group (RBHPCG), and Home Lending. A Treasury / Other function includes, along with technology and operations, other unallocated assets, liabilities, revenue, and expense.

A rollforward of goodwill by business segment for the first nine-month period of 2015 is presented in the table below:



(dollar amounts in thousands)	Retail & Business Banking		Commercial Banking		AFCRE		RBHPCG			Home Lending		Treasury/ Other		Huntington Consolidated
Balance, beginning of period	$	368,097	$	59,594	$	—	$	90,012		$	—	$	4,838	$	522,541
Goodwill acquired during the period	—		155,828		—		—			—		—		155,828
Adjustments	—		—		—		(1,500		)	—		—		(1,500		)
Impairment	—		—		—		—			—		—		—
Balance, end of period	$	368,097	$	215,422	$	—	$	88,512		$	—	$	4,838	$	676,869

On March 31, 2015, Huntington completed its acquisition of Macquarie Equipment Finance, which was re-branded Huntington Technology Finance. As part of the transaction, Huntington recorded $155.8 million of goodwill and $8.2 million of other intangible assets. For additional information on the acquisition, see Business Combinations footnote.

During the 2015 third quarter, Huntington adjusted the goodwill in the RBHPCG segment related to a held for sale disposal group at September 30, 2015. The amount was adjusted based on relative fair value methodology.

Goodwill is not amortized but is evaluated for impairment on an annual basis at October 1 of each year or whenever events or changes in circumstances indicate the carrying value may not be recoverable. As a result of the 2014 first quarter reorganization in our reported business segments, goodwill was reallocated among the business segments. Immediately following the reallocation, impairment of $3.0 million was recorded in the Home Lending reporting segment.

At September 30, 2015 and December 31, 2014, Huntington’s other intangible assets consisted of the following:



(dollar amounts in thousands)	Gross Carrying Amount		Accumulated Amortization			Net Carrying Value
September 30, 2015
Core deposit intangible	$	400,058	$	(383,459	)	$	16,599
Customer relationship	116,120		(74,025		)	42,095
Other	25,164		(25,065		)	99
Total other intangible assets	$	541,342	$	(482,549	)	$	58,793
December 31, 2014
Core deposit intangible	$	400,058	$	(366,907	)	$	33,151
Customer relationship	107,920		(66,534		)	41,386
Other	25,164		(25,030		)	134
Total other intangible assets	$	533,142	$	(458,471	)	$	74,671

The estimated amortization expense of other intangible assets for the remainder of 2015 and the next five years is as follows:




(dollar amounts in thousands)	Amortization Expense
2015	$	3,786
2016	14,316
2017	12,908
2018	11,135
2019	9,825
2020	3,076

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

+ References + Details