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CAPITAL REQUIREMENTS AND RESTRICTIONS ON RETAINED EARNINGS
 12 Months Ended
Sep. 30, 2019
CAPITAL REQUIREMENTS AND RESTRICTIONS ON RETAINED EARNINGS [Abstract]  
CAPITAL REQUIREMENTS AND RESTRICTIONS ON RETAINED EARNINGS CAPITAL REQUIREMENTS AND RESTRICTIONS ON RETAINED EARNINGS
 
As U.S. banking organizations, the Company and the Bank are required to comply with the regulatory capital rules adopted by the Federal Reserve and the OCC (the "Capital Rules") that became effective on January 1, 2015, subject to phase-in periods for certain requirements and other provisions of the Capital Rules. Under the Capital Rules and the regulatory framework for prompt corrective action, the Company and Bank must meet specific capital guidelines that involve quantitative measures of the Company’s and Bank’s assets, liabilities and certain off-balance-sheet items as calculated under regulatory accounting practices. The Company’s and Bank’s capital amounts and classifications are also subject to qualitative judgments by regulators about components, risk weightings and other factors.

The Capital Rules require the Company and the Bank to maintain minimum ratios (set forth in the table below) of total risk-based capital and Tier 1 capital (as defined in the regulations) to risk-weighted assets (as defined), and a leverage ratio consisting of Tier 1 capital (as defined) to average assets (as defined).  At September 30, 2019, both the Bank and the Company exceeded federal regulatory minimum capital requirements to be classified as well-capitalized under the prompt corrective action requirements.  The Company and the Bank took the accumulated other comprehensive income (“AOCI”) opt-out election; under the rule, non-advanced approach banking organizations were given a one-time option to exclude certain AOCI components.  The table below includes certain non-GAAP financial measures that are used by investors, analysts and bank regulatory agencies to assess the capital position of financial services companies.  Management reviews these measures along with other measures of capital as part of its financial analyses and has included this non-GAAP financial information, and the corresponding reconciliation to total equity.

 
Company
 
Bank
 
Minimum to be Adequately Capitalized Under Prompt Corrective Action Provisions
 
Minimum to be Well Capitalized Under Prompt Corrective Action Provisions
September 30, 2019
 
 
 
 
 
 
 
Tier 1 leverage capital ratio
8.33
%
 
9.65
%
 
4.00
%
 
5.00
%
Common equity Tier 1 capital ratio
10.35

 
12.31

 
4.50

 
6.50

Tier 1 capital ratio
10.71

 
12.37

 
6.00

 
8.00

Total capital ratio
13.01

 
13.02

 
8.00

 
10.00

 
 
 
 
 
 
 
 
September 30, 2018
 

 
 

 
 

 
 

Tier 1 leverage capital ratio
8.50
%
 
9.75
%
 
4.00
%
 
5.00
%
Common equity Tier 1 capital ratio
10.56

 
12.50

 
4.50

 
6.50

Tier 1 capital ratio
10.97

 
12.56

 
6.00

 
8.00

Total capital ratio
13.18

 
12.89

 
8.00

 
10.00



The following table provides a reconciliation of the amounts included in the table above for the Company.
 
Standardized Approach(1)
September 30, 2019
(Dollars in Thousands)
 
Total stockholders' equity
$
843,958

Adjustments:
 
LESS: Goodwill, net of associated deferred tax liabilities
304,020

LESS: Certain other intangible assets
50,501

LESS: Net deferred tax assets from operating loss and tax credit carry-forwards
15,569

LESS: Net unrealized gains (losses) on available-for-sale securities
6,458

LESS: Noncontrolling interest
4,047

LESS: Unrealized currency gains (losses)
—

Common Equity Tier 1 (1)
463,363

Long-term borrowings and other instruments qualifying as Tier 1
13,661

Tier 1 minority interest not included in common equity tier 1 capital
2,350

Total Tier 1 capital
479,374

Allowance for loan and lease losses
29,272

Subordinated debentures (net of issuance costs)
73,644

Total capital
$
582,290


(1)Capital Ratios were determined using the Capital Rules that became effective on January 1, 2015. The Capital Rules revised the definition of capital, increased minimum capital ratios, and introduced a minimum common equity tier 1 capital ratio; those changes are being fully phased in through the end of 2021.

Since January 1, 2016, the Company and the Bank have been required to maintain a capital conservation buffer above the minimum risk-based capital requirements in order to avoid certain limitations on capital distributions, stock repurchases and discretionary bonus payments to executive officers. The capital conservation buffer is exclusively composed of Common Equity Tier 1 capital, and it applies to each of the three risk-based capital ratios but not the leverage ratio. On January 1, 2019, the Company and Bank were in compliance with the capital conservation buffer requirement. The implementation of the capital conservation buffer by annual increments finished on January 1, 2019, so that the required Common Equity Tier 1 risk-based, Tier 1 risk-based and total risk-based capital ratios with the buffer are currently 7.0%, 8.5% and 10.5%, respectively.