Navy Federal Credit Union 2014 Annual Report Download - page 54

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Navy Federal Credit Union36
The following table summarizes the carrying amount of goodwill that is classified as Goodwill and other
intangible assets, net on the Consolidated Statements of Financial Condition:
(dollars in thousands)
Carrying Value
of Goodwill
December 31, 2012 $ 58,905
Adjustments during 2013 —
December 31, 2013 58,905
Adjustments during 2014 —
December 31, 2014 $ 58,905
Other Intangible Assets
Navy Federal’s acquisition of USAFCU on October 1, 2010 resulted in the recognition of a $2.0 million core
deposit intangible asset related to money market accounts. Core deposit balances represent a favorable
source of financing for financial institutions, and a “core deposit intangible” asset represents the fair value
of cost savings derived from available core deposits acquired relative to the cost of alternative funding.
The core deposit intangible was amortized on a straight-line basis over its estimated useful life of four
years. Amortization expense was $0.4 million and $0.5 million at December 31, 2014 and 2013. The gross
carrying amount, accumulated amortization and net carrying amount of the core deposit intangible were
as follows at December 31:
(dollars in thousands) 2014 2013
Gross carrying amount $ 2,040 $ 2,040
Accumulated amortization (2,040) (1,657)
Net carrying amount $ — $ 383
As of December 31, 2014, the core deposit intangible is fully amortized.
NOTE 15: MEMBERS’ ACCOUNTS
Interest rates on members’ share accounts are set by the Board of Directors and are based on an
evaluation of current and future market conditions. Interest on members’ accounts is based on available
earnings for each interest period and is not guaranteed by Navy Federal. In claims against the assets of
Navy Federal, such as in the event of its liquidation, Navy Federal members’ accounts are subordinate
to other liabilities of Navy Federal. The aggregate amount of deposit accounts exceeding $250,000
was $2.1 billion and $1.8 billion at December 31, 2014 and 2013, respectively.