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Regulatory Capital
 12 Months Ended
Dec. 31, 2018
Banking and Thrift [Abstract]  
Regulatory Capital
Note 21 – Regulatory Capital
Horizon and the Bank are subject to various regulatory capital requirements administered by the federal banking agencies and are assigned to a capital category. Failure to meet the minimum regulatory capital requirements can initiate certain mandatory and possible additional discretionary actions by regulators, which if undertaken, could have a direct material effect on the Company’s financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective actions, the Company and Bank must meet specific capital guidelines involving quantitative measures of the 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 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 Bank to maintain minimum amounts and ratios of total and Tier I capital (as defined in the regulations) to risk-weighted assets (as defined), and of Tier I capital (as defined) to average assets (as defined), or leverage ratio. For December 31, 2018 and 2017, Basel III rules require the Company and Bank to maintain minimum amounts and ratios of common equity Tier I capital (as defined in the regulation) to risk-weighted assets (as defined). Additionally, under Basel III rules, the decision was made to opt-out of including accumulated other comprehensive income in regulatory capital.
To be categorized as well capitalized, the Company and Bank must maintain minimum Total risk-based, Tier I risk-based, common equity Tier I risk-based and Tier I leverage ratios as set forth in the table below. As of December 31, 2018 and December 31, 2017, the Company and Bank met all capital adequacy requirements to be considered well capitalized. There have been no conditions or events since the year ending December 31, 2018 that management believes have changed the Bank’s classification as well capitalized. There is no threshold for well-capitalized status for bank holding companies.
Horizon and the Bank’s actual and required capital ratios as of December 31, 2018 and 2017 were as follows:
 
 
 
Actual
 
 
Required for Capital
1

‎
Adequacy Purposes
 
 
Required For Capital
1

‎
Adequacy Purposes

‎
with Capital Buffer
 
 
Well Capitalized Under

‎
Prompt
1

Corrective Action

‎
Provisions
 
 
 
Amount
 
 
Ratio
 
 
Amount
 
 
Ratio
 
 
Amount
 
 
Ratio
 
 
Amount
 
 
Ratio
 
December 31, 2018
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total capital
1
(to risk-weighted assets)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Consolidated
 
$
427,616
 
 
 
13.39
%
 
$
255,419
 
 
 
8.00
%
 
$
315,283
 
 
 
9.875
%
 
 
N/A
 
 
 
N/A
 
Bank
 
 
396,755
 
 
 
12.43
%
 
 
255,419
 
 
 
8.00
%
 
 
315,283
 
 
 
9.875
%
 
$
319,274
 
 
 
10.00
%
Tier 1 capital
1
(to risk-weighted assets)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Consolidated
 
 
409,760
 
 
 
12.83
%
 
 
191,565
 
 
 
6.00
%
 
 
251,429
 
 
 
7.875
%
 
 
N/A
 
 
 
N/A
 
Bank
 
 
378,899
 
 
 
11.87
%
 
 
191,565
 
 
 
6.00
%
 
 
251,429
 
 
 
7.875
%
 
 
255,420
 
 
 
8.00
%
Common equity tier 1 capital
1
(to risk-weighted assets)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Consolidated
 
 
371,297
 
 
 
11.63
%
 
 
143,673
 
 
 
4.50
%
 
 
203,537
 
 
 
6.375
%
 
 
N/A
 
 
 
N/A
 
Bank
 
 
378,899
 
 
 
11.87
%
 
 
143,674
 
 
 
4.50
%
 
 
203,537
 
 
 
6.375
%
 
 
207,528
 
 
 
6.50
%
Tier 1 capital
1
(to average assets)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Consolidated
 
 
409,760
 
 
 
10.12
%
 
 
162,033
 
 
 
4.00
%
 
 
162,033
 
 
 
4.000
%
 
 
N/A
 
 
 
N/A
 
Bank
 
 
378,899
 
 
 
9.34
%
 
 
162,327
 
 
 
4.00
%
 
 
162,327
 
 
 
4.000
%
 
 
202,908
 
 
 
5.00
%
December 31, 2017
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total capital
1
(to risk-weighted assets)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Consolidated
 
$
384,800
 
 
 
12.91
%
 
$
238,543
 
 
 
8.00
%
 
$
275,816
 
 
 
9.25
%
 
 
N/A
 
 
 
N/A
 
Bank
 
 
382,788
 
 
 
12.85
%
 
 
238,386
 
 
 
8.00
%
 
 
275,634
 
 
 
9.25
%
 
$
297,982
 
 
 
10.00
%
Tier 1 capital
1
(to risk-weighted assets)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Consolidated
 
 
368,355
 
 
 
12.35
%
 
 
178,907
 
 
 
6.00
%
 
 
216,180
 
 
 
7.25
%
 
 
N/A
 
 
 
N/A
 
Bank
 
 
366,343
 
 
 
12.29
%
 
 
178,790
 
 
 
6.00
%
 
 
216,038
 
 
 
7.25
%
 
 
238,386
 
 
 
8.00
%
Common equity tier 1 capital
1
(to risk-weighted assets)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Consolidated
 
 
329,892
 
 
 
11.06
%
 
 
134,181
 
 
 
4.50
%
 
 
171,454
 
 
 
5.75
%
 
 
N/A
 
 
 
N/A
 
Bank
 
 
366,343
 
 
 
12.29
%
 
 
134,092
 
 
 
4.50
%
 
 
171,340
 
 
 
5.75
%
 
 
193,689
 
 
 
6.50
%
Tier 1 capital
1
(to average assets)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Consolidated
 
 
368,355
 
 
 
9.92
%
 
 
148,503
 
 
 
4.00
%
 
 
148,503
 
 
 
4.00
%
 
 
N/A
 
 
 
N/A
 
Bank
 
 
366,343
 
 
 
9.89
%
 
 
148,116
 
 
 
4.00
%
 
 
148,116
 
 
 
4.00
%
 
 
185,145
 
 
 
5.00
%
The above minimum capital requirements exclude the capital conservation buffer required to avoid limitations on capital distributions, including dividend payments and certain discretionary bonus payments to executive officers. The capital conservation buffer is being phased in from 0.0% for 2015 to 2.50% by 2019. The capital conservation buffer was 1.875% at December 31, 2018. The net unrealized gain or loss on available for sale securities is not included in computing regulatory capital.