Wells Fargo 2009 Annual Report Download - page 138

Wealth,
Community Wholesale Brokerage and Consolidated
(in millions) Banking Banking Retirement Company
December 31, 2007 $ 10,591 2,147 368 13,106
Reduction in goodwill related to divested businesses — (1) — (1)
Goodwill from business combinations 6,229 3,303 — 9,532
Foreign currency translation adjustments (10) — — (10)
December 31, 2008 16,810 5,449 368 22,627
Goodwill from business combinations 1,343 830 5 2,178
Foreign currency translation adjustments 7 — — 7
December 31, 2009 $18,160 6,279 373 24,812
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The gross carrying value of intangible assets and accumulated amortization was:
Note 10: Intangible Assets
The following table provides the current year and estimated future amortization expense for amortized intangible assets.
December 31,
2009 2008
Gross Gross
carrying Accumulated carrying Accumulated
(in millions) value amortization value amortization
Amortized intangible assets:
MSRs (1) $ 1,606 487 1,672 226
Core deposit intangibles 15,140 4,366 14,188 2,189
Customer relationship and other intangibles 3,050 896 3,988 486
Total amortized intangible assets $19,796 5,749 19,848 2,901
MSRs (carried at fair value) (1) $16,004 14,714
Goodwill 24,812 22,627
Trademark 14 14
(1) See Note 9 in this Report for additional information on MSRs.
Customer
Amortized Core relationship
commercial deposit and other
(in millions) MSRs intangibles intangibles(1) Total
Year ended December 31, 2009 (actual) $264 2,180 412 2,856
Estimate for year ended December 31,
2010 $224 1,870 337 2,431
2011 198 1,593 289 2,080
2012 161 1,396 274 1,831
2013 125 1,241 254 1,620
2014 108 1,113 238 1,459
(1) Includes amortization of lease intangibles reported in occupancy expense of $8 million for 2009, and estimated amortization of $9 million, $8 million, $8 million,
$5 million, and $4 million for 2010, 2011, 2012, 2013 and 2014, respectively.
We based our projections of amortization expense shown
above on existing asset balances at December 31, 2009. Future
amortization expense may vary from these projections.
For our goodwill impairment analysis, we allocate all of the
goodwill to the individual operating segments. As a result of
the combination of Wells Fargo and Wachovia, management
realigned its business segments into the following three lines
of business: Community Banking; Wholesale Banking; and
Wealth, Brokerage and Retirement. As part of this realignment,
we updated our reporting units. We identify reporting units
that are one level below an operating segment (referred to as
a component), and distinguish these reporting units based on
how the segments and components are managed, taking into
consideration the economic characteristics, nature of the
products and customers of the components. We allocate
goodwill to reporting units based on relative fair value, using
certain performance metrics. We have revised prior period
information to reflect this realignment. See Note 23 in this
Report for further information on management reporting.
The following table shows the allocation of goodwill
to our operating segments for purposes of goodwill impair-
ment testing. The additions in 2009 predominantly relate
to goodwill recorded in connection with refinements to our
initial acquisition date purchase accounting.