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Regulatory Matters | 12 Months Ended
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Dec. 31, 2018
Banking and Thrift [Abstract] |
Regulatory Matters |
| 19. | REGULATORY MATTERS
The Company (on a consolidated basis) and the Bank are subject to various regulatory capital requirements administered by the federal banking regulatory agencies. Failure to meet minimum capital requirements can initiate certain mandatory, and possibly additional discretionary, actions by regulators that, if undertaken, could have a direct, material effect on the Company’s and the Bank’s financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company and Bank must meet specific capital guidelines that involve quantitative measures of assets, liabilities, and certain off-balance-sheet items as calculated under regulatory accounting practices. The capital amounts and classification are also subject to qualitative judgment by the regulators about components, risk-weightings, and other factors. Prompt corrective action provisions are not applicable to bank holding companies. Effective January 1, 2015, the Company and the Bank became subject to a new regulatory capital measure called Common Equity Tier 1 (“CET1”) to risk-weighted assets which was implemented as a result of the “Basel III” regulatory capital reforms and changes required by the Dodd-Frank Act. Basel III also introduces a new “capital conservation buffer,” composed entirely of CET1, on top of minimum risk-weighted asset ratios. The capital conservation buffer is designed to absorb losses during periods of economic stress. Banking institutions with a ratio of CET1 to risk-weighted assets above the minimum requirement but below the capital conservation buffer will face constraints on dividends, equity repurchases and payment of discretionary bonuses based on the amount of the shortfall. The implementation of the capital conservation buffer began on January 1, 2016 at 0.625% and will be phased in over a four-year period (increasing by that amount on each subsequent January 1, until it reaches 2.5% on January 1, 2019). Thus, when fully phased in on January 1, 2019, the Bank will be required to maintain this additional capital conservation buffer of 2.5% of CET1. Quantitative measures established by regulation to ensure capital adequacy require the Company and the Bank to maintain minimum amounts and ratios (set forth in the table below) of total capital, Tier 1 capital and CET1 capital to risk-weighted assets, and of Tier 1 capital to average assets. Management believes that, as of December 31, 2018 and 2017, the Company and the Bank meet all capital adequacy requirements to which they are subject. As of December 31, 2018 and 2017, the most recent notifications from the FDIC categorized the Bank as well capitalized under the regulatory framework for prompt corrective action. To be categorized as well capitalized, the minimum total risk-based, Tier 1 risk-based, CET1 risk-based, and Tier 1 leverage (tangible Tier 1 capital divided by average total assets) ratios as set forth in the table below must be maintained. There are no conditions or events since said notification that management believes have changed the Bank’s category. As of December 31, 2018 and 2017, the Company had $25.0 million of trust-preferred securities, which were included in Tier 1 capital for regulatory purposes, respectively. The following table summarizes regulatory capital amounts and ratios for the Company and the Bank as of December 31, 2018 and 2017.
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | To Be Well |
|  |  |  |  |  |  |  | For Capital |  |  | Capitalized under Prompt Corrective |
|  | Actual |  |  | Adequacy Purposes |  |  | Action Provisions |
|  | Amount |  |  | Ratio |  |  | Amount |  |  |  |  |  | Ratio |  |  | Amount |  |  |  |  |  | Ratio |
|  | (Dollars in thousands) |
As of December 31, 2018: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Total Capital (to Risk-Weighted Assets) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Company |  | $ | 1,263,800 |  |  |  | 14.13 | % |  | $ | 715,283 |  |  |  | > |  |  |  | 8.00 | % |  |  |  |  |  |  |  |  |  |  | N/A |
Bank |  | $ | 1,253,219 |  |  |  | 14.03 | % |  | $ | 714,601 |  |  |  | > |  |  |  | 8.00 | % |  | $ | 893,251 |  |  |  | > |  |  |  | 10.00 | %
Tier 1 Capital (to Risk-Weighted Assets) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Company |  | $ | 1,191,228 |  |  |  | 13.32 | % |  | $ | 536,462 |  |  |  | > |  |  |  | 6.00 | % |  |  |  |  |  |  |  |  |  |  | N/A |
Bank |  | $ | 1,180,647 |  |  |  | 13.22 | % |  | $ | 535,951 |  |  |  | > |  |  |  | 6.00 | % |  | $ | 714,601 |  |  |  | > |  |  |  | 8.00 | %
Common equity Tier 1 capital ratio |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Company |  | $ | 1,166,228 |  |  |  | 13.04 | % |  | $ | 402,347 |  |  |  | > |  |  |  | 4.50 | % |  |  |  |  |  |  |  |  |  |  | N/A |
Bank |  | $ | 1,180,647 |  |  |  | 13.22 | % |  | $ | 401,963 |  |  |  | > |  |  |  | 4.50 | % |  | $ | 580,613 |  |  |  | > |  |  |  | 6.50 | %
Tier 1 Capital (to Average- Assets) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Company |  | $ | 1,191,228 |  |  |  | 10.98 | % |  | $ | 433,834 |  |  |  | > |  |  |  | 4.00 | % |  |  |  |  |  |  |  |  |  |  | N/A |
Bank |  | $ | 1,180,647 |  |  |  | 10.90 | % |  | $ | 433,403 |  |  |  | > |  |  |  | 4.00 | % |  | $ | 541,754 |  |  |  | > |  |  |  | 5.00 | %
As of December 31, 2017: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Total Capital (to Risk-Weighted Assets) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Company |  | $ | 1,039,060 |  |  |  | 18.01 | % |  | $ | 461,574 |  |  |  | > |  |  |  | 8.00 | % |  |  |  |  |  |  |  |  |  |  | N/A |
Bank |  | $ | 1,029,126 |  |  |  | 17.86 | % |  | $ | 461,037 |  |  |  | > |  |  |  | 8.00 | % |  | $ | 576,296 |  |  |  | > |  |  |  | 10.00 | %
Tier 1 Capital (to Risk-Weighted Assets) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Company |  | $ | 973,169 |  |  |  | 16.87 | % |  | $ | 346,180 |  |  |  | > |  |  |  | 6.00 | % |  |  |  |  |  |  |  |  |  |  | N/A |
Bank |  | $ | 963,235 |  |  |  | 16.71 | % |  | $ | 345,778 |  |  |  | > |  |  |  | 6.00 | % |  | $ | 461,037 |  |  |  | > |  |  |  | 8.00 | %
Common equity Tier 1 capital ratio |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Company |  | $ | 948,210 |  |  |  | 16.43 | % |  | $ | 259,635 |  |  |  | > |  |  |  | 4.50 | % |  |  |  |  |  |  |  |  |  |  | N/A |
Bank |  | $ | 963,235 |  |  |  | 16.71 | % |  | $ | 259,333 |  |  |  | > |  |  |  | 4.50 | % |  | $ | 374,592 |  |  |  | > |  |  |  | 6.50 | %
Tier 1 Capital (to Average- Assets) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Company |  | $ | 973,169 |  |  |  | 11.88 | % |  | $ | 327,680 |  |  |  | > |  |  |  | 4.00 | % |  |  |  |  |  |  |  |  |  |  | N/A |
Bank |  | $ | 963,235 |  |  |  | 11.77 | % |  | $ | 327,397 |  |  |  | > |  |  |  | 4.00 | % |  | $ | 409,246 |  |  |  | > |  |  |  | 5.00 | %
In addition, the California Financial Code limits the amount of dividends a bank can pay without obtaining prior approval from bank regulators. Under this law, the Bank could, as of December 31, 2018, declare and pay additional dividends of approximately $184.0 million.

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- Definition The entire disclosure for banks, savings institutions, and credit unions, for regulatory capital requirements imposed by the Federal Reserve System (FRB), the Federal Deposit Insurance Corporation (FDIC), the Office of Thrift Supervision (OTS) or for any state imposed capital requirements, as applicable. The disclosure may include (1) a description of regulatory capital requirements (a) for capital adequacy purposes and (b) established by the prompt corrective action provisions of Section 38 of the Federal Depository Insurance Act; (2) the actual or possible material effects of noncompliance with such requirements; (3) whether the entity is in compliance with the regulatory capital requirements including (a) required and actual ratios and amounts of Tier 1 leverage, Tier 1 risk-based, and total risk-based capital, tangible capital (for savings institutions), and Tier 3 capital for market risk (for certain banks and bank holding companies), (b) factors that may significantly affect capital adequacy; (4) the prompt corrective action category in which the entity was classified as of its most recent notification; (5) whether management believes any conditions or events since notification have changed the entity's category. Also may include additional information that might be disclosed in situations where substantial doubt about the entity's ability to continue as a going concern for a reasonable period of time. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 505 -Section 50 -Paragraph 1C -URI http://asc.fasb.org/extlink&oid=84167132&loc=SL5958572-112826 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 505 -Section 50 -Paragraph 1D -URI http://asc.fasb.org/extlink&oid=84167132&loc=SL5958573-112826 Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 505 -Section 50 -Paragraph 1B -URI http://asc.fasb.org/extlink&oid=84167132&loc=SL5958570-112826 Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 505 -Section 50 -Paragraph 1A -URI http://asc.fasb.org/extlink&oid=84167132&loc=SL5958569-112826 Reference 5: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 505 -Section 50 -Paragraph 1G -URI http://asc.fasb.org/extlink&oid=84167132&loc=SL5958577-112826 Reference 6: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 505 -Section 50 -Paragraph 1F -URI http://asc.fasb.org/extlink&oid=84167132&loc=SL5958575-112826 Reference 7: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 505 -Section 50 -Paragraph 1E -URI http://asc.fasb.org/extlink&oid=84167132&loc=SL5958574-112826 Reference 8: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 505 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=84167132&loc=SL5958568-112826 Reference 9: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 505 -Section 50 -Paragraph 1H -URI http://asc.fasb.org/extlink&oid=84167132&loc=d3e65071-112826 + Details
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