SunTrust 2008 Annual Report Download - page 119

SUNTRUST BANKS, INC.
Notes to Consolidated Financial Statements (Continued)
The changes in carrying amounts of other intangible assets for the years ended December 31 are as follows:
(Dollars in thousands)
Core Deposit
Intangible
Mortgage
Servicing
Rights Other Total
Balance, January 1, 2007 $241,614 $810,509 $129,861 $1,181,984
Amortization (68,959) (181,263) (27,721) (277,943)
MSRs originated - 639,158 - 639,158
Intangible assets obtained from sale upon merger of Lighthouse
Partners, net 1- - 24,142 24,142
Client relationship intangible obtained from acquisition of TBK
Investments, Inc. - - 6,520 6,520
Purchase of GenSpring (formerly AMA, LLC) minority shares - - 2,205 2,205
Client relationship intangible obtained from acquisition of Inlign
Wealth Management - - 4,120 4,120
Intangible assets obtained from acquisition of minority interest in
Alpha Equity Management - - 1,788 1,788
Sale of MSRs - (218,979) - (218,979)
Balance, December 31, 2007 $172,655 $1,049,425 $140,915 $1,362,995
Amortization (56,854) (223,092) (19,406) (299,352)
MSRs originated - 485,597 - 485,597
MSRs impairment reserve - (371,881) - (371,881)
MSRs impairment recovery - 1,881 - 1,881
Sale of interest in Lighthouse Partners - - (5,992) (5,992)
Sale of MSRs - (131,456) - (131,456)
Customer intangible impairment charge - - (45,000) (45,000)
Purchased credit card relationships 2- - 9,898 9,898
Acquisition of GB&T 329,510 - - 29,510
Sale of First Mercantile Trust - - (3,033) (3,033)
Other - - 2,260 2,260
Balance, December 31, 2008 $145,311 $810,474 $79,642 $1,035,427
1During the first quarter of 2007 SunTrust merged its wholly-owned subsidiary, Lighthouse Partners, into Lighthouse Investment
Partners, LLC in exchange for a minority interest in Lighthouse Investment Partners, LLC and a revenue-sharing agreement. This
transaction resulted in a $7.9 million decrease in existing intangible assets and a new intangible asset of $32.0 million.
2During the third quarter of 2008, SunTrust purchased a credit card portfolio of loans including the cardholder relationships from another
financial institution representing an outstanding balance of $82.4 million at the time of acquisition. A majority of the premium paid was
attributed to the cardholder relationships and is being amortized over seven years.
3During the second quarter of 2008, SunTrust acquired 100% of the outstanding shares of GB&T. As a result of the acquisition, SunTrust
assumed $1.4 billion of deposit liabilities and recorded core deposit intangibles that are being amortized over an eight year period.
Intangible assets subject to amortization must be tested for impairment whenever events or changes in circumstances indicate
that their carrying amounts may not be recoverable. The Company experienced a triggering event with respect to certain
Wealth and Investment Management customer relationship intangibles during the second quarter of 2008 and performed
impairment testing which resulted in an impairment charge of $45.0 million. The fair value of the customer relationship
intangibles was determined using the residual income method and was compared to the carrying value to determine the
amount of impairment. The impairment charge was recorded in noninterest expense and pertains to the client relationships
that were recorded in 2004 in connection with an acquisition. While the overall acquired business was performing
satisfactorily, the attrition level of the legacy clients had increased resulting in the impairment of this intangible asset.
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