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Note 17 - Regulatory Capital Requirements and Restrictions on Dividends | 12 Months Ended
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Dec. 31, 2022
Notes to Financial Statements |
Regulatory Capital Requirements and Restrictions on Dividends | Note 17. Regulatory Capital Requirements and Restrictions on Dividends The Company (on a consolidated basis) and the subsidiary banks are subject to various regulatory capital requirements administered by the federal 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 direct material effect on the Company and subsidiary banks’ financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company and the subsidiary banks 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. Quantitative measures established by regulation to ensure capital adequacy require the Company and the subsidiary banks to maintain minimum amounts and ratios (set forth in the following table) of total common equity Tier 1 and Tier 1 capital to risk-weighted assets and of Tier 1 capital to average assets, each as defined by regulation. Management believes, as of December 31, 2022 and 2021, that the Company and the subsidiary banks met all capital adequacy requirements to which they are subject. Under the regulatory framework for prompt corrective action, to be categorized as “well capitalized,” an institution must maintain minimum total risk-based, Tier 1 risk-based, Tier 1 leverage and common equity Tier 1 ratios as set forth in the following tables. The Company and the subsidiary banks’ actual capital amounts and ratios as of December 31, 2022 and 2021 are also presented in the following table (dollars in thousands). As of December 31, 2022 and 2021, the subsidiary banks met the requirements to be “well capitalized”. ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | For Capital | ​ | To Be Well |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | Adequacy Purposes | ​ | Capitalized Under |
​ | ​ | ​ | ​ | ​ | ​ | ​ | For Capital | ​ | With Capital | ​ | Prompt Corrective |
​ | ​ | Actual | ​ | Adequacy Purposes | ​ | Conservation Buffer | ​ | Action Provisions |
​ |  | Amount |  | Ratio |  | Amount | ​ | Ratio |  | Amount | ​ | Ratio |  | Amount | ​ | Ratio | ​
​ | ​ | ( dollars in thousands) | ​
As of December 31, 2022: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Company: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total risk-based capital | ​ | $ | 1,055,177 | ​ | 14.28 | % | $ | 591,132 | > | 8.00 | % | $ | 775,861 | > | 10.50 | % | $ | 738,915 | > | 10.00 | %
Tier 1 risk-based capital | ​ |  | 734,977 |  | 9.95 | ​ |  | 443,349 | > | 6.00 | ​ |  | 628,078 | > | 8.50 | ​ |  | 591,132 | > | 8.00 | ​
Tier 1 leverage | ​ |  | 734,977 |  | 9.61 | ​ |  | 305,959 | > | 4.00 | ​ |  | 305,959 | > | 4.00 | ​ |  | 382,449 | > | 5.00 | ​
Common equity Tier 1 | ​ |  | 686,375 |  | 9.29 | ​ |  | 332,512 | > | 4.50 | ​ |  | 517,241 | > | 7.00 | ​ |  | 480,295 | > | 6.50 | ​
Quad City Bank & Trust: | ​ |  | ​ |  | ​ | ​ |  | ​ |  | ​ | ​ |  | ​ |  | ​ | ​ |  | ​ |  | ​ | ​
Total risk-based capital | ​ | $ | 275,337 | ​ | 13.07 | % | $ | 168,588 | > | 8.00 | % | $ | 221,272 | > | 10.50 | % | $ | 210,735 | > | 10.00 | %
Tier 1 risk-based capital | ​ |  | 248,978 |  | 11.81 | ​ |  | 126,441 | > | 6.00 | ​ |  | 179,125 | > | 8.50 | ​ |  | 168,588 | > | 8.00 | ​
Tier 1 leverage | ​ |  | 248,978 |  | 11.01 | ​ |  | 90,419 | > | 4.00 | ​ |  | 90,419 | > | 4.00 | ​ |  | 133,023 | > | 5.00 | ​
Common equity Tier 1 | ​ |  | 248,978 |  | 11.81 | ​ |  | 94,831 | > | 4.50 | ​ |  | 147,514 | > | 7.00 | ​ |  | 136,978 | > | 6.50 | ​
Cedar Rapids Bank & Trust: | ​ |  | ​ | ​ | ​ | ​ |  | ​ |  | ​ | ​ |  | ​ |  | ​ | ​ |  | ​ |  | ​ | ​
Total risk-based capital | ​ | $ | 308,153 | ​ | 14.84 | % | $ | 166,168 | > | 8.00 | % | $ | 218,096 | > | 10.50 | % | $ | 207,711 | > | 10.00 | %
Tier 1 risk-based capital | ​ |  | 282,258 |  | 13.59 | ​ |  | 124,626 | > | 6.00 | ​ |  | 176,554 | > | 8.50 | ​ |  | 166,168 | > | 8.00 | ​
Tier 1 leverage | ​ |  | 282,258 |  | 13.17 | ​ |  | 85,707 | > | 4.00 | ​ |  | 85,707 | > | 4.00 | ​ |  | 107,134 | > | 5.00 | ​
Common equity Tier 1 | ​ |  | 282,258 |  | 13.59 | ​ |  | 93,470 | > | 4.50 | ​ |  | 145,397 | > | 7.00 | ​ |  | 135,012 | > | 6.50 | ​
Community State Bank: | ​ |  | ​ | ​ | ​ | ​ |  | ​ |  | ​ | ​ |  | ​ |  | ​ | ​ |  | ​ |  | ​ | ​
Total risk-based capital | ​ | $ | 142,974 | ​ | 12.04 | % | $ | 94,981 | > | 8.00 | % | $ | 124,662 | > | 10.50 | % | $ | 118,726 | > | 10.00 | %
Tier 1 risk-based capital | ​ |  | 128,130 |  | 10.79 | ​ |  | 71,236 | > | 6.00 | ​ |  | 100,917 | > | 8.50 | ​ |  | 94,981 | > | 8.00 | ​
Tier 1 leverage | ​ |  | 128,130 |  | 10.09 | ​ |  | 50,799 | > | 4.00 | ​ |  | 50,799 | > | 4.00 | ​ |  | 63,499 | > | 5.00 | ​
Common equity Tier 1 | ​ |  | 128,130 |  | 10.79 | ​ |  | 53,427 | > | 4.50 | ​ |  | 83,108 | > | 7.00 | ​ |  | 77,172 | > | 6.50 | ​
Guaranty Bank: | ​ |  | ​ | ​ | ​ | ​ |  | ​ |  | ​ | ​ |  | ​ |  | ​ | ​ |  | ​ |  | ​ | ​
Total risk-based capital | ​ | $ | 243,106 | ​ | 12.24 | % | $ | 158,903 | > | 8.00 | % | $ | 208,560 | > | 10.50 | % | $ | 198,629 | > | 10.00 | %
Tier 1 risk-based capital | ​ |  | 218,647 |  | 11.01 | ​ |  | 119,177 | > | 6.00 | ​ |  | 168,834 | > | 8.50 | ​ |  | 158,903 | > | 8.00 | ​
Tier 1 leverage | ​ |  | 218,647 |  | 10.90 | ​ |  | 80,229 | > | 4.00 | ​ |  | 80,229 | > | 4.00 | ​ |  | 100,286 | > | 5.00 | ​
Common equity Tier 1 | ​ |  | 218,647 |  | 11.01 | ​ |  | 89,383 | > | 4.50 | ​ |  | 139,040 | > | 7.00 | ​ |  | 129,109 | > | 6.50 | ​
​ ​ Note 17. Regulatory Capital Requirements and Restrictions on Dividends (continued)
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | For Capital | ​ | To Be Well |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | Adequacy Purposes | ​ | Capitalized Under |
​ | ​ | ​ | ​ | ​ | ​ | ​ | For Capital | ​ | With Capital | ​ | Prompt Corrective |
​ | ​ | Actual | ​ | Adequacy Purposes | ​ | Conservation Buffer | ​ | Action Provisions |
​ |  | Amount |  | Ratio |  | Amount | ​ | Ratio |  | Amount | ​ | Ratio |  | Amount | ​ | Ratio |
​ | ​ | ( dollars in thousands) | ​
As of December 31, 2021: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Company: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total risk-based capital | ​ | $ | 814,629 | ​ | 14.77 | % | $ | 441,100 | > | 8.00 | % | $ | 578,944 | > | 10.50 | % | $ | 551,375 | > | 10.00 | %
Tier 1 risk-based capital | ​ |  | 631,649 |  | 11.46 | ​ |  | 330,825 | > | 6.00 | ​ |  | 468,669 | > | 8.50 | ​ |  | 441,100 | > | 8.00 | ​
Tier 1 leverage | ​ |  | 631,649 |  | 10.46 | ​ |  | 241,579 | > | 4.00 | ​ |  | 241,579 | > | 4.00 | ​ |  | 301,974 | > | 5.00 | ​
Common equity Tier 1 | ​ |  | 593,494 |  | 10.76 | ​ |  | 248,119 | > | 4.50 | ​ |  | 385,962 | > | 7.00 | ​ |  | 358,394 | > | 6.50 | ​
Quad City Bank & Trust: | ​ |  | ​ |  | ​ | ​ |  | ​ |  | ​ | ​ |  | ​ |  | ​ | ​ |  | ​ |  | ​ | ​
Total risk-based capital | ​ | $ | 247,658 | ​ | 13.29 | % | $ | 149,126 | > | 8.00 | % | $ | 195,727 | > | 10.50 | % | $ | 186,407 | > | 10.00 | %
Tier 1 risk-based capital | ​ |  | 224,253 | ​ | 12.03 | ​ |  | 111,844 | > | 6.00 | ​ |  | 158,446 | > | 8.50 | ​ |  | 149,126 | > | 8.00 | ​
Tier 1 leverage | ​ |  | 224,253 | ​ | 10.45 | ​ |  | 85,873 | > | 4.00 | ​ |  | 85,873 | > | 4.00 | ​ |  | 107,341 | > | 5.00 | ​
Common equity Tier 1 | ​ |  | 224,253 | ​ | 12.03 | ​ |  | 83,883 | > | 4.50 | ​ |  | 130,485 | > | 7.00 | ​ |  | 121,164 | > | 6.50 | ​
Cedar Rapids Bank & Trust: | ​ |  | ​ | ​ | ​ | ​ |  | ​ |  | ​ | ​ |  | ​ |  | ​ | ​ |  | ​ |  | ​ | ​
Total risk-based capital | ​ | $ | 277,673 | ​ | 14.85 | % | $ | 149,595 | > | 8.00 | % | $ | 196,343 | > | 10.50 | % | $ | 186,993 | > | 10.00 | %
Tier 1 risk-based capital | ​ |  | 254,279 | ​ | 13.60 | ​ |  | 112,196 | > | 6.00 | ​ |  | 158,944 | > | 8.50 | ​ |  | 149,595 | > | 8.00 | ​
Tier 1 leverage | ​ |  | 254,279 | ​ | 12.59 | ​ |  | 80,777 | > | 4.00 | ​ |  | 80,777 | > | 4.00 | ​ |  | 100,971 | > | 5.00 | ​
Common equity Tier 1 | ​ |  | 254,279 | ​ | 13.60 | ​ |  | 84,147 | > | 4.50 | ​ |  | 130,895 | > | 7.00 | ​ |  | 121,546 | > | 6.50 | ​
Community State Bank: | ​ |  | ​ | ​ | ​ | ​ |  | ​ |  | ​ | ​ |  | ​ |  | ​ | ​ |  | ​ |  | ​ | ​
Total risk-based capital | ​ | $ | 123,365 | ​ | 11.95 | % | $ | 82,601 | > | 8.00 | % | $ | 108,413 | > | 10.50 | % | $ | 103,251 | > | 10.00 | %
Tier 1 risk-based capital | ​ |  | 110,410 | ​ | 10.69 | ​ |  | 61,951 | > | 6.00 | ​ |  | 87,763 | > | 8.50 | ​ |  | 82,601 | > | 8.00 | ​
Tier 1 leverage | ​ |  | 110,410 | ​ | 9.67 | ​ |  | 45,676 | > | 4.00 | ​ |  | 45,676 | > | 4.00 | ​ |  | 57,095 | > | 5.00 | ​
Common equity Tier 1 | ​ |  | 110,410 | ​ | 10.69 | ​ |  | 46,463 | > | 4.50 | ​ |  | 72,276 | > | 7.00 | ​ |  | 67,113 | > | 6.50 | ​
Guaranty Bank: | ​ |  | ​ | ​ | ​ | ​ |  | ​ |  | ​ | ​ |  | ​ |  | ​ | ​ |  | ​ |  | ​ | ​
Total risk-based capital | ​ | $ | 101,067 | ​ | 13.39 | % | $ | 60,369 | > | 8.00 | % | $ | 79,235 | > | 10.50 | % | $ | 75,462 | > | 10.00 | %
Tier 1 risk-based capital | ​ |  | 91,625 | ​ | 12.14 | ​ |  | 45,277 | > | 6.00 | ​ |  | 64,142 | > | 8.50 | ​ |  | 60,369 | > | 8.00 | ​
Tier 1 leverage | ​ |  | 91,625 | ​ | 11.08 | ​ |  | 33,088 | > | 4.00 | ​ |  | 33,088 | > | 4.00 | ​ |  | 41,360 | > | 5.00 | ​
Common equity Tier 1 | ​ |  | 91,625 | ​ | 12.14 | ​ |  | 33,958 | > | 4.50 | ​ |  | 52,823 | > | 7.00 | ​ |  | 49,050 | > | 6.50 | ​
​ The Company’s ability to pay dividends to its stockholders may be affected by both general corporate law considerations and policies of the Federal Reserve applicable to bank holding companies. The payment of dividends by any financial institution or its holding company is affected by the requirement to maintain adequate capital pursuant to applicable capital adequacy guidelines and regulations, and a financial institution generally is prohibited from paying any dividends if, following payment thereof, the institution would be undercapitalized. Notwithstanding the availability of funds for dividends, however, the Federal Reserve may prohibit the payment of any dividends by the subsidiary banks if the Federal Reserve determines such payment would constitute an unsafe or unsound practice. The Company also has certain contractual restrictions on its ability to pay dividends. The Company has issued junior subordinated debentures in four private placements and assumed four issues of junior subordinated debentures in connection with the acquisitions. Under the terms of the debentures, the Company may be prohibited, under certain circumstances, from paying dividends on shares of its common stock. These circumstances did not exist at December 31, 2022 or 2021. On February 13, 2020, the board of directors of the Company approved a share repurchase program under which the Company was authorized to repurchase, from time to time as the Company deemed appropriate, up to 800,000 shares of its outstanding common stock, or approximately 5% of the outstanding shares as of December 31, 2019. On May 19, 2022, the Board of Directors of the Company approved a share repurchase program under which the Company is authorized to repurchase, from time to time as the Company deems appropriate, up to an additional 1,500,000 shares of its outstanding common stock, or approximately 10% of the outstanding shares as of December 31, 2021. There were 970,000 and 293,153 shares of common stock purchased by the Company during the year ended December 31, 2022 and 2021, respectively. There were 935,915 shares of common stock remaining for repurchase as of December 31, 2022.

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