Berkshire Hills Bancorp (NYSE: BHLB), a $13 billion asset bank headquartered in Boston, took a nearly $554 million goodwill impairment charge in the second quarter. The write-down represents all of Berkshire Hills' goodwill, a balance that accumulated through years of acquisitions.
When any company buys another, it's likely to pay more than the value of its tangible assets would justify. That premium, which may factor in the value of the target's brand, intellectual property, and its relationships with customers and employees, among other things, goes on the buyer's balance sheet as an intangible asset labeled goodwill.
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