PNC » Topics » Other Intangible Assets

This excerpt taken from the PNC 10-Q filed May 11, 2009.

Other Intangible Assets

 

In millions    March 31
2009
    December 31
2008
 

Customer-related and other intangibles

      

Gross carrying amount

   $ 1,808     $ 1,291  

Accumulated amortization

     (426 )     (361 )

Net carrying amount

   $ 1,382     $ 930  

Mortgage and other loan servicing rights

      

Gross carrying amount

   $ 2,351     $ 2,286  

Valuation allowance

     (16 )     (35 )

Accumulated amortization

     (394 )     (361 )

Net carrying amount

   $ 1,941     $ 1,890  

Total

   $ 3,323     $ 2,820  

During the first quarter of 2009, adjustments were made to the estimated fair values of assets acquired and liabilities assumed as part of the National City acquisition. This resulted in the recognition of $514 million of core deposit and other relationship intangibles at March 31, 2009. As of December 31, 2008, the values of these intangibles had been reduced by the allocation of negative goodwill.

While certain of our other intangible assets have finite lives and are amortized primarily on a straight-line basis, certain core deposit intangibles are amortized on an accelerated basis.

For customer-related intangibles, the estimated remaining useful lives range from less than one year to 14 years, with a weighted-average remaining useful life of approximately 11 years.

Changes in commercial mortgage servicing rights follow:

This excerpt taken from the PNC 10-K filed Mar 2, 2009.

Other Intangible Assets

 

December 31 - in millions    2008 (a)     2007  

Customer-related and other intangibles

      

Gross carrying amount

   $ 1,291     $ 708  

Accumulated amortization

     (361 )     (263 )

Net carrying amount

   $ 930     $ 445  

Mortgage and other loan servicing rights

      

Gross carrying amount

   $ 2,286     $ 1,001  

Impairment charge

     (35 )    

Accumulated amortization

     (361 )     (300 )

Net carrying amount

   $ 1,890     $ 701  

Total

   $ 2,820     $ 1,146  

 

(a) Amounts at December 31, 2008 include National City.

Our acquisition of National City resulted in the addition of $569 million of core deposit and other relationship intangibles

at December 31, 2008. Core deposits include noninterest and interest-bearing demand accounts, savings and money market accounts. In addition, mortgage servicing rights increased $1.2 billion primarily related to the National City acquisition. The intangibles were valued utilizing a discounted cash flows model.

While certain of our other intangible assets have finite lives and are amortized primarily on a straight-line basis, commercial mortgage and other loan servicing rights and certain core deposit intangibles are amortized on an accelerated basis. Residential mortgage servicing rights are carried at fair value and not amortized.

For customer-related intangibles, the estimated remaining useful lives range from less than one year to 14 years, with a weighted-average remaining useful life of approximately 10 years. Our commercial mortgage and other loan servicing rights are amortized primarily over a period of 2 to 13 years in proportion to the estimated net servicing cash flows from the related loans.

We recognize as an other intangible asset the right to service mortgage loans for others. Commercial mortgage servicing rights are purchased in the open market and originated when loans are sold with servicing retained. Commercial mortgage servicing rights are initially recorded at fair value. These rights are subsequently measured using the amortization method. Accordingly, the commercial mortgage servicing rights are amortized in proportion to and over the period of estimated net servicing income.

Residential mortgage servicing rights of $1 billion were recognized in connection with the acquisition of National City. We have elected to subsequently measure residential mortgage servicing rights at fair value consistent with how we manage the risk of these assets.

Amortizable commercial mortgage servicing rights are periodically evaluated for impairment. For purposes of impairment, the commercial mortgage servicing rights are stratified based on asset type, which characterizes the predominant risk of the underlying financial asset. If the carrying amount of any individual stratum exceeds its fair value, a valuation reserve is established with a corresponding charge to Corporate Services on our Consolidated Income Statement.

The fair value of commercial and residential mortgage servicing rights is estimated by using an internal valuation model. The model calculates the present value of estimated future net servicing cash flows considering estimates on servicing revenue and costs, discount rates and prepayment speeds.


 

116


Table of Contents

Changes in the commercial mortgage servicing rights were as follows:

This excerpt taken from the PNC 10-Q filed Nov 6, 2008.

Other Intangible Assets

 

In millions   

September 30,

2008

   

December 31,

2007

 

Customer-related and other intangibles

      

Gross carrying amount

   $ 723     $ 708  

Accumulated amortization

     (337 )     (263 )

Net carrying amount

   $ 386     $ 445  

Mortgage and other loan servicing rights

      

Gross carrying amount

   $ 1,043     $ 1,001  

Accumulated amortization (a)

     (337 )     (300 )

Net carrying amount

   $ 706     $ 701  

Total

   $ 1,092     $ 1,146  
(a) Amount for September 30, 2008 was reduced by $35 million related to a retirement.

While certain of our other intangible assets have finite lives and are amortized primarily on a straight-line basis, commercial mortgage and other loan servicing rights and certain core deposit intangibles are amortized on an accelerated basis.

For customer-related intangibles, the estimated remaining useful lives range from less than one year to 14 years, with a weighted-average remaining useful life of approximately 8 years. Our mortgage and other loan servicing rights are amortized primarily over a period of five to 10 years in proportion to the estimated net servicing cash flows from the related loans.

A summary of the changes in goodwill by business segment for the nine months ended September 30, 2008 follows:

This excerpt taken from the PNC 10-Q filed Aug 8, 2008.

Other Intangible Assets

 

In millions   

June 30,

2008

   

December 31,

2007

 

Customer-related and other intangibles

      

Gross carrying amount

   $ 724     $ 708  

Accumulated amortization

     (312 )     (263 )

Net carrying amount

   $ 412     $ 445  

Mortgage and other loan servicing rights

      

Gross carrying amount

   $ 1,043     $ 1,001  

Accumulated amortization

     (351 )     (300 )

Net carrying amount

   $ 692     $ 701  

Total

   $ 1,104     $ 1,146  

While certain of our other intangible assets have finite lives and are amortized primarily on a straight-line basis, commercial mortgage and other loan servicing rights and certain core deposit intangibles are amortized on an accelerated basis.

For customer-related intangibles, the estimated remaining useful lives range from less than one year to 14 years, with a weighted-average remaining useful life of approximately 8 years. Our mortgage and other loan servicing rights are amortized primarily over a period of five to 10 years in proportion to the estimated net servicing cash flows from the related loans.

A summary of the changes in goodwill by business segment for the six months ended June 30, 2008 follows:

This excerpt taken from the PNC 10-Q filed May 12, 2008.

Other Intangible Assets

 

In millions   

March 31

2008

   

December 31

2007

 

Customer-related and
other intangibles

      

Gross carrying amount

   $ 708     $ 708  

Accumulated amortization

     (287 )     (263 )

Net carrying amount

   $ 421     $ 445  

Mortgage and other loan servicing
rights

      

Gross carrying amount

   $ 1,014     $ 1,001  

Accumulated amortization

     (330 )     (300 )

Net carrying amount

   $ 684     $ 701  

Total

   $ 1,105     $ 1,146  

While most of our other intangible assets have finite lives and are amortized primarily on a straight-line basis, mortgage and other loan servicing rights and certain core deposit intangibles are amortized on an accelerated basis.

For customer-related intangibles, the estimated remaining useful lives range from less than one year to 15 years, with a weighted-average remaining useful life of approximately eight years. Our mortgage and other loan servicing rights are amortized primarily over a period of five to 10 years in proportion to the estimated net servicing cash flows from the related loans.


 

59


Table of Contents

The changes in the carrying amount of goodwill and net other intangible assets for the three months ended March 31, 2008 are as follows:

This excerpt taken from the PNC 10-K filed Feb 29, 2008.

Other Intangible Assets

 

December 31 - in millions    2007     2006  

Customer-related and other intangibles

      

Gross carrying amount

   $ 708     $ 342  

Accumulated amortization

     (263 )     (178 )

Net carrying amount

   $ 445     $ 164  

Mortgage and other loan

servicing rights

      

Gross carrying amount

   $ 1,001     $ 689  

Accumulated amortization

     (300 )     (212 )

Net carrying amount

   $ 701     $ 477  

Total

   $ 1,146     $ 641  

While most of our other intangible assets have finite lives and are amortized primarily on a straight-line basis, mortgage and other loan servicing rights and certain core deposit intangibles are amortized on an accelerated basis.

For customer-related intangibles, the estimated remaining useful lives range from less than one year to 15 years, with a weighted-average remaining useful life of approximately 9 years. Our mortgage and other loan servicing rights are amortized primarily over a period of 5 to 10 years in proportion to the estimated net servicing cash flows from the related loans.

 

The changes in the carrying amount of goodwill and net other intangible assets during 2007 follows:

This excerpt taken from the PNC 10-K filed Feb 4, 2008.

Other Intangible Assets

 

December 31 - in millions    2006     2005  

Customer-related and other intangibles

      

Gross carrying amount (a)

   $342     $646  

Accumulated amortization

   (178 )   (143 )

Net carrying amount

   $164     $503  

Mortgage and other loan servicing rights

      

Gross carrying amount

   $689     $511  

Accumulated amortization

   (212 )   (167 )

Net carrying amount

   $477     $344  

Total

   $641     $847  
(a) Amounts for 2006 were reduced by $305 million related to the BlackRock deconsolidation. See Note 2 Acquisitions for additional information regarding our deconsolidation of BlackRock effective September 29, 2006.

Most of our other intangible assets have finite lives and are amortized primarily on a straight-line basis or, in the case of mortgage and other loan servicing rights and certain core deposit intangibles, on an accelerated basis.

For customer-related intangibles, the estimated remaining useful lives range from less than one year to 11 years, with a weighted-average remaining useful life of approximately 5 years. Our mortgage and other loan servicing rights are amortized primarily over a period of five to 10 years in proportion to the estimated net servicing income from the related loans.

 

The changes in the carrying amount of goodwill and net other intangible assets during 2006 follows:

This excerpt taken from the PNC 10-Q filed Nov 8, 2007.

Other Intangible Assets

 

In millions    September 30,
2007
    December 31,
2006
 

Customer-related and

other intangibles

      

Gross carrying amount

     $623     $342  

Accumulated amortization

     (238 )   (178 )

Net carrying amount

     $385     $164  

Mortgage and other loan servicing rights

      

Gross carrying amount

     $985     $689  

Accumulated amortization

     (271 )   (212 )

Net carrying amount

     $714     $477  

Total

   $ 1,099     $641  

While most of our other intangible assets have finite lives and are amortized primarily on a straight-line basis, mortgage and other loan servicing rights and certain core deposit intangibles are amortized on an accelerated basis.

 

For customer-related intangibles, the estimated remaining useful lives range from less than 1 year to 11 years, with a weighted-average remaining useful life of approximately 7 years. Our mortgage and other loan servicing rights are amortized primarily over a period of 5 to 10 years in proportion to the estimated net servicing cash flows from the related loans.

The changes in the carrying amount of goodwill and net other intangible assets for the nine months ended September 30, 2007 are as follows:

This excerpt taken from the PNC 10-Q filed Aug 8, 2007.

Other Intangible Assets

 

In millions   

June 30

2007

   

December 31

2006

 

Customer-related and other intangibles

      

Gross carrying amount

   $ 623     $ 342  

Accumulated amortization

     (215 )     (178 )

Net carrying amount

   $ 408     $ 164  

Mortgage and other loan servicing rights

      

Gross carrying amount

   $ 751     $ 689  

Accumulated amortization

     (246 )     (212 )

Net carrying amount

   $ 505     $ 477  

Total

   $ 913     $ 641  

Most of our other intangible assets have finite lives and are amortized primarily on a straight-line basis or, in the case of mortgage and other loan servicing rights and certain core deposit intangibles, on an accelerated basis.

For customer-related intangibles, the estimated remaining useful lives range from less than 1 year to 12 years, with a weighted-average remaining useful life of approximately 8 years. Our mortgage and other loan servicing rights are amortized primarily over a period of 5 to 10 years in proportion to the estimated net servicing cash flows from the related loans.

 

The changes in the carrying amount of goodwill and net other intangible assets for the six months ended June 30, 2007 are as follows:

Wikinvest © 2006, 2007, 2008, 2009, 2010, 2011, 2012. Use of this site is subject to express Terms of Service, Privacy Policy, and Disclaimer. By continuing past this page, you agree to abide by these terms. Any information provided by Wikinvest, including but not limited to company data, competitors, business analysis, market share, sales revenues and other operating metrics, earnings call analysis, conference call transcripts, industry information, or price targets should not be construed as research, trading tips or recommendations, or investment advice and is provided with no warrants as to its accuracy. Stock market data, including US and International equity symbols, stock quotes, share prices, earnings ratios, and other fundamental data is provided by data partners. Stock market quotes delayed at least 15 minutes for NASDAQ, 20 mins for NYSE and AMEX. Market data by Xignite. See data providers for more details. Company names, products, services and branding cited herein may be trademarks or registered trademarks of their respective owners. The use of trademarks or service marks of another is not a representation that the other is affiliated with, sponsors, is sponsored by, endorses, or is endorsed by Wikinvest.
Powered by MediaWiki