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Regulatory Matters
 3 Months Ended
Mar. 31, 2017
Banking and Thrift [Abstract]  
Regulatory Matters
Regulatory Matters
The Company and the Bank are subject to various regulatory capital requirements administered by the federal and state banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a material and adverse effect on the Company’s and the Bank’s business, financial condition and results of operation, such as restrictions on growth or the payment of dividends or other capital distributions or management fees. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company and the Bank must meet specific capital guidelines that involve quantitative measures of their assets, liabilities and certain off-balance-sheet items as calculated under regulatory accounting practices. The capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings and other factors.
In July, 2013, the federal bank regulatory agencies adopted final regulations, which revised their risk-based and leverage capital requirements for banking organizations to meet requirements of Dodd-Frank and to implement Basel III international agreements reached by the Basel Committee. The final rules began for the Company and the Bank on January 1, 2015 and are subject to a phase-in period through January 1, 2019. The final rules that had an impact on the Company and the Bank include:
•
An increase in the minimum Tier 1 capital ratio from 4.00% to 6.00% of risk-weighted assets;
•
A new category and a required 4.50% of risk-weighted assets ratio is established for “Common Equity Tier 1” as a subset of Tier 1 capital limited to common equity;
•
A minimum non-risk-based leverage ratio is set at 4.00%, eliminating a 3.00% exception for higher rated banks;
•
Changes in the permitted composition of Tier 1 capital to exclude trust preferred securities, mortgage servicing rights and certain deferred tax assets and include unrealized gains and losses on available for sale debt and equity securities;
•
The risk-weights of certain assets for purposes of calculating the risk-based capital ratios are changed for high volatility commercial real estate acquisition, development and construction loans, certain past due non-residential mortgage loans and certain mortgage-backed and other securities exposures; and
•
A new additional capital conservation buffer of 2.5% of risk weighted assets over each of the required capital ratios is being phased in from 2016 to 2019 and must be met to avoid limitations on the ability of the Bank to pay dividends, repurchase shares, or pay discretionary bonuses. The capital conservation buffer for the Company was initially 0.625% in 2016, and increases 0.625% annually until 2019. As of March 31, 2017, the capital conservation buffer for the Company stood at 1.25%.
As of March 31, 2017, the ratios for the Company and the Bank are sufficient to meet the fully phased-in conservation buffer.
As of March 31, 2017 and December 31, 2016, the most recent regulatory notification categorized the Bank as “well-capitalized” under the regulatory framework for prompt corrective action. To be categorized as “well-capitalized”, the Bank must maintain minimum total risk-based, Tier I risk-based, common equity Tier 1, and Tier I leverage ratios as set forth in the following table. There are no conditions or events since the notification from regulators that management believes has changed the institution’s category. As of March 31, 2017 and December 31, 2016, the Company and Bank met all capital adequacy requirements to which they are subject to.
The Company’s and the Bank’s capital amounts and ratios are presented in the table below:
 
Actual
 
Required
For Capital
Adequacy Purposes
 
Minimum Capital Adequacy With Capital Buffer
 
Required
To Be Well
Capitalized Under
Prompt Corrective
Action Provisions
 
Amount
 
Ratio
 
Amount
 
Ratio
 
Amount
 
Ratio
 
Amount
 
Ratio
 
(Dollars in thousands)
As of March 31, 2017
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Common equity tier 1 capital
(to risk weighted assets):
 
 
 
 
 
 
 
 
 
 
 
 
Company
$
1,413,592

 
12.22
%
 
$
520,711

 
4.50
%
 
$
665,353

 
5.75
%
 
N/A

 
N/A

Bank
$
1,489,239

 
12.88
%
 
$
520,425

 
4.50
%
 
$
664,987

 
5.75
%
 
$
751,724

 
6.50
%
Total capital
(to risk-weighted assets):
 
 
 
 
 
 
 
 
 
 
 
 
Company
$
1,591,852

 
13.76
%
 
$
925,708

 
8.00
%
 
$
1,070,350

 
9.25
%
 
N/A

 
N/A

Bank
$
1,571,333

 
13.59
%
 
$
925,199

 
8.00
%
 
$
1,069,762

 
9.25
%
 
$
1,156,499

 
10.00
%
Tier I capital
(to risk-weighted assets):
 
 
 
 
 
 
 
 
 
 
 
 
Company
$
1,509,758

 
13.05
%
 
$
694,281

 
6.00
%
 
$
838,923

 
7.25
%
 
N/A

 
N/A

Bank
$
1,489,239

 
12.88
%
 
$
693,899

 
6.00
%
 
$
838,462

 
7.25
%
 
$
925,199

 
8.00
%
Tier I capital
(to average assets):
 
 
 
 
 
 
 
 
 
 
 
 
Company
$
1,509,758

 
11.72
%
 
$
515,352

 
4.00
%
 
N/A

 
N/A

 
N/A

 
N/A

Bank
$
1,489,239

 
11.56
%
 
$
515,212

 
4.00
%
 
N/A

 
N/A

 
$
644,014

 
5.00
%
 
Actual
 
Required
For Capital
Adequacy Purposes
 
Minimum Capital Adequacy With Capital Buffer
 
Required
To Be Well
Capitalized Under
Prompt Corrective
Action Provisions
 
Amount
 
Ratio
 
Amount
 
Ratio
 
Amount
 
Ratio
 
Amount
 
Ratio
 
(Dollars in thousands)
As of December 31, 2016
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Common equity tier 1 capital
(to risk weighted assets):
 
 
 
 
 
 
 
 
 
 
 
 
Company
$
1,400,246

 
12.10
%
 
$
520,917

 
4.50
%
 
$
593,267

 
5.13
%
 
N/A

 
N/A

Bank
$
1,475,228

 
12.75
%
 
$
520,631

 
4.50
%
 
$
592,941

 
5.13
%
 
$
752,022

 
6.50
%
Total capital
(to risk-weighted assets):
 
 
 
 
 
 
 
 
 
 
 
 
Company
$
1,578,690

 
13.64
%
 
$
926,076

 
8.00
%
 
$
998,425

 
8.63
%
 
N/A

 
N/A

Bank
$
1,557,765

 
13.46
%
 
$
925,566

 
8.00
%
 
$
997,876

 
8.63
%
 
$
1,156,957

 
10.00
%
Tier I capital
(to risk-weighted assets):
 
 
 
 
 
 
 
 
 
 
 
 
Company
$
1,496,153

 
12.92
%
 
$
694,557

 
6.00
%
 
$
766,906

 
6.63
%
 
N/A

 
N/A

Bank
$
1,475,228

 
12.75
%
 
$
694,174

 
6.00
%
 
$
766,484

 
6.63
%
 
$
925,566

 
8.00
%
Tier I capital
(to average assets):
 
 
 
 
 
 
 
 
 
 
 
 
Company
$
1,496,153

 
11.49
%
 
$
520,947

 
4.00
%
 
N/A

 
N/A

 
N/A

 
N/A

Bank
$
1,475,228

 
11.33
%
 
$
520,903

 
4.00
%
 
N/A

 
N/A

 
$
651,129

 
5.00
%