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Regulatory Capital Requirements and Restrictions
 12 Months Ended
Dec. 31, 2011
Deposits and Regulatory Capital Requirements and Restrictions [Abstract]  
Regulatory Capital Requirements and Restrictions
Note 14. Regulatory Capital Requirements and Restrictions

The Company and the Bank are subject to various regulatory capital requirements administered by state and 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’s financial statements. Under the capital adequacy guidelines and the regulatory framework for prompt corrective action, which applies only to the Bank, the Bank must meet specific capital guidelines that involve quantitative measures of the entity’s assets, liabilities, and certain off-balance sheet items as calculated under regulatory accounting practices. The Bank’s capital amounts and classifications 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 for total and Tier 1 capital (as defined in the regulations) to risk-weighted assets (as defined), and of Tier 1 capital (as defined) to average assets (as defined).

To be categorized as well capitalized, the Bank must maintain minimum total capital to risk-weighted assets, Tier 1 capital to risk-weighted assets, and Tier 1 capital to average assets (leverage) ratios established by banking regulators. At December 31, 2011, the Company and the Bank met all capital adequacy requirements to which they are subject. At December 31, 2011 and 2010, the most recent notifications from regulators categorized the Bank as well capitalized under the regulatory framework for prompt corrective action. There are no conditions or events since those notifications that management believes have changed the institution’s category.

 

The following tables present the Company’s and the Bank’s capital ratios at December 31, 2011 and 2010:

 

                                                 
    December 31, 2011  
                      To Be Well  
                For Capital     Capitalized Under  
                Adequacy     Prompt Corrective  
    Actual     Purposes     Action Provisions  
(Amounts in thousands)   Amount     Ratio     Amount     Ratio     Amount     Ratio  

Total Capital to Risk-Weighted Assets

                                                

First Community Bancshares, Inc.

   $ 257,836       18.15 %    $ 113,626       8.00 %      N/A       N/A  

First Community Bank

     226,508       16.12 %      112,411       8.00 %    $ 140,514       10.00 % 

Tier 1 Capital to Risk-Weighted Assets

                                                

First Community Bancshares, Inc.

     239,928       16.89 %      56,813       4.00 %      N/A       N/A  

First Community Bank

     208,833       14.86 %      56,206       4.00 %      84,308       6.00 % 

Tier 1 Capital to Average Assets (Leverage)

                                                

First Community Bancshares, Inc.

     239,928       11.50 %      83,474       4.00 %      N/A       N/A  

First Community Bank

     208,833       10.08 %      82,909       4.00 %      103,637       5.00 % 

 

                                                 
    December 31, 2010  
                      To Be Well  
                For Capital     Capitalized Under  
                Adequacy     Prompt Corrective  
    Actual     Purposes     Action Provisions  
(Amounts in thousands)   Amount     Ratio     Amount     Ratio     Amount     Ratio  

Total Capital to Risk-Weighted Assets

                                                

First Community Bancshares, Inc.

   $ 224,932       15.33 %    $ 117,349       8.00 %      N/A       N/A  

First Community Bank

     207,143       14.18 %      116,892       8.00 %    $ 146,115       10.00 % 

Tier 1 Capital to Risk-Weighted Assets

                                                

First Community Bancshares, Inc.

     206,428       14.07 %      58,675       4.00 %      N/A       N/A  

First Community Bank

     188,771       12.92 %      58,446       4.00 %      87,669       6.00 % 

Tier 1 Capital to Average Assets (Leverage)

                                                

First Community Bancshares, Inc.

     206,428       9.44 %      87,468       4.00 %      N/A       N/A  

First Community Bank

     188,771       8.66 %      87,155       4.00 %      108,944       5.00 % 

The primary source of funds for dividends paid by the Company is dividends received from the Bank. Dividends paid by the Bank are subject to restrictions by banking regulations. Approval by regulatory authorities is required if the effect of dividends declared would cause the regulatory capital of the Bank to fall below specified minimum levels. As described below, the Bank is required to maintain heightened regulatory capital ratios. Approval is also required if dividends declared exceed the net profits for that year combined with the retained net profits for the preceding two years.