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SHAREHOLDERS' EQUITY AND REGULATORY CAPITAL | 6 Months Ended
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Jun. 30, 2022
Equity [Abstract] |
SHAREHOLDERS’ EQUITY AND REGULATORY CAPITAL | SHAREHOLDERS’ EQUITY AND REGULATORY CAPITAL Banks and bank holding companies are subject to regulatory capital requirements administered by federal banking agencies. Capital adequacy guidelines and, additionally for banks, prompt corrective action regulations, involve quantitative measures of assets, liabilities and certain off-balance sheet items calculated under regulatory accounting practices. Capital amounts and classifications are also subject to qualitative judgments by regulators. Failure to meet capital requirements can initiate regulatory action. Under the Basel Committee on Banking Supervision's capital guidelines for U.S. Banks ("Basel III rules"), an entity must hold a capital conservation buffer above the adequately capitalized risk-based capital ratios. The Company and the Bank have elected not to include net unrealized gains or losses included in AOCI in computing regulatory capital. The consolidated asset limit on small bank holding companies is $3.0 billion and a company with assets under that limit is not subject to the FRB consolidated capital rules, but may file reports that include capital amounts and ratios. The Company has elected to file those reports. Management believes that the Company and the Bank met all capital adequacy requirements to which they are subject at June 30, 2022 and December 31, 2021. Prompt corrective action regulations provide five classifications: well capitalized, adequately capitalized, undercapitalized, significantly undercapitalized and critically undercapitalized, although these terms are not used to represent overall financial condition. If adequately capitalized, regulatory approval is required to accept brokered deposits. If undercapitalized, capital distributions are limited, as is asset growth and expansion, and capital restoration plans are required. At June 30, 2022, the most recent regulatory notifications categorized the Bank as well capitalized under the regulatory framework for prompt corrective action. There are no conditions or events since that notification that management believes have changed the Bank's classification. The following table presents capital amounts and ratios at June 30, 2022 and December 31, 2021:
| Actual |  | For Capital Adequacy Purposes (includes applicable capital conservation buffer) |  | To Be Well Capitalized Under Prompt Corrective Action Provisions
| Amount |  | Ratio |  | Amount |  | Ratio |  | Amount |  | Ratio
June 30, 2022 |  |  |  |  |  |  |  |  |  |  |
Total risk-based capital: |  |  |  |  |  |  |  |  |  |  |
Orrstown Financial Services, Inc. | $ | 300,376 |  |  | 13.5 | % |  | $ | 234,163 |  |  | 10.5 | % |  | n/a |  | n/a
Orrstown Bank | 296,723 |  |  | 13.3 | % |  | 234,096 |  |  | 10.5 | % |  | $ | 222,949 |  |  | 10.0 | %
Tier 1 risk-based capital: |  |  |  |  |  |  |  |  |  |  |
Orrstown Financial Services, Inc. | 243,470 |  |  | 10.9 | % |  | 189,560 |  |  | 8.5 | % |  | n/a |  | n/a
Orrstown Bank | 271,811 |  |  | 12.2 | % |  | 189,506 |  |  | 8.5 | % |  | 178,359 |  |  | 8.0 | %
Tier 1 common equity risk-based capital: |  |  |  |  |  |  |  |  |  |  |
Orrstown Financial Services, Inc. | 243,470 |  |  | 10.9 | % |  | 156,109 |  |  | 7.0 | % |  | n/a |  | n/a
Orrstown Bank | 271,811 |  |  | 12.2 | % |  | 156,064 |  |  | 7.0 | % |  | 144,917 |  |  | 6.5 | %
Tier 1 leverage capital: |  |  |  |  |  |  |  |  |  |  |
Orrstown Financial Services, Inc. | 243,470 |  |  | 8.5 | % |  | 114,400 |  |  | 4.0 | % |  | n/a |  | n/a
Orrstown Bank | 271,811 |  |  | 9.5 | % |  | 114,452 |  |  | 4.0 | % |  | 143,065 |  |  | 5.0 | %
December 31, 2021 |  |  |  |  |  |  |  |  |  |  |
Total risk-based capital: |  |  |  |  |  |  |  |  |  |  |
Orrstown Financial Services, Inc. | $ | 297,823 |  |  | 15.0 | % |  | $ | 208,617 |  |  | 10.5 | % |  | n/a |  | n/a
Orrstown Bank | 278,780 |  |  | 14.0 | % |  | 208,550 |  |  | 10.5 | % |  | $ | 198,619 |  |  | 10.0 | %
Tier 1 risk-based capital: |  |  |  |  |  |  |  |  |  |  |
Orrstown Financial Services, Inc. | 243,075 |  |  | 12.2 | % |  | 168,880 |  |  | 8.5 | % |  | n/a |  | n/a
Orrstown Bank | 255,995 |  |  | 12.9 | % |  | 168,826 |  |  | 8.5 | % |  | 158,895 |  |  | 8.0 | %
Tier 1 common equity risk-based capital: |  |  |  |  |  |  |  |  |  |  |
Orrstown Financial Services, Inc. | 243,075 |  |  | 12.2 | % |  | 139,078 |  |  | 7.0 | % |  | n/a |  | n/a
Orrstown Bank | 255,995 |  |  | 12.9 | % |  | 139,033 |  |  | 7.0 | % |  | 129,102 |  |  | 6.5 | %
Tier 1 leverage capital: |  |  |  |  |  |  |  |  |  |  |
Orrstown Financial Services, Inc. | 243,075 |  |  | 8.5 | % |  | 114,384 |  |  | 4.0 | % |  | n/a |  | n/a
Orrstown Bank | 255,995 |  |  | 8.9 | % |  | 114,470 |  |  | 4.0 | % |  | 143,087 |  |  | 5.0 | %
In September 2015, the Board of Directors of the Company authorized a share repurchase program under which the Company may repurchase up to 5% of the Company's outstanding shares of common stock, or approximately 416,000 shares, in accordance with all applicable securities laws and regulations, including Rule 10b-18 of the Exchange Act. On April 19, 2021, the Board of Directors authorized the additional future repurchase of up to 562,000 shares of its outstanding common stock. When and if appropriate, repurchases may be made in the open market or privately negotiated transactions, depending on market conditions, regulatory requirements and other corporate considerations, as determined by management. Share repurchases may not occur and may be discontinued at any time. At June 30, 2022, 823,629 shares had been repurchased at a total cost of $18.8 million, or $22.79 per share. Common stock available for future repurchase totals approximately 154,371 shares, or 1% of the Company's outstanding common stock at June 30, 2022. On July 18, 2022, the Board of Directors declared a cash dividend of $0.19 per common share, which will be paid on August 8, 2022 to shareholders of record at August 1, 2022.

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