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Note 13: Stockholders' Equity and Regulatory Capital | 12 Months Ended
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Jun. 30, 2014
Notes |
Note 13: Stockholders' Equity and Regulatory Capital | NOTE 13: Stockholders’ Equity and Regulatory Capital On November 22, 2011, the Company completed an underwritten public offering of common shares in which it sold 1,150,000 shares to the public for $19.00 per share, for aggregate gross proceeds of $21.9 million. The net proceeds to the Company after deducting underwriting discounts and commissions and offering expenses were $19.9 million. The proceeds from the offering are being used for general corporate purposes, including the funding of loan growth and the purchase of securities. The Company and Bank are subject to various regulatory capital requirements administered by the Federal banking agencies. Failure to meet minimum capital requirements can result in 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 capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company and Bank must meet specific capital guidelines that involve quantitative measures of the Company and the Bank’s assets, liabilities, and certain off-balance sheet items as calculated under regulatory accounting practices. The Company and Bank’s capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors. Furthermore, the Company and Bank’s regulators could require adjustments to regulatory capital not reflected in the condensed consolidated financial statements. Quantitative measures established by regulation to ensure capital adequacy require the Company and the Bank to maintain minimum amounts and ratios (set forth in the table below) of total capital and Tier 1 capital (as defined in the regulations) to risk-weighted assets (as defined) and of Tier 1 capital (as defined) to average total assets (as defined). Management believes, as of June 30, 2014 and 2013, that the Company and the Bank meet all capital adequacy requirements to which they are subject. As of June 30, 2014, the most recent notification from the Federal Reserve 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 1 risk-based, and Tier 1 leverage ratios as set forth in the table. There are no conditions or events since that notification that management believes have changed the Bank’s category. The tables below summarize the Company and Bank’s actual and required regulatory capital:
| Actual | For Capital Adequacy Purposes | To Be Well Capitalized Under Prompt Corrective Action Provisions
As of June 30, 2014 | Amount | Ratio | Amount | Ratio | Amount | Ratio
Total Capital (to Risk-Weighted Assets) |  |  |  |  |  |
Consolidated | $125,930 | 16.38% | $61,522 | 8.00% | n/a | n/a
Southern Bank | 114,811 | 15.07% | 60,968 | 8.00% | 76,211 | 10.00%
Tier I Capital (to Risk-Weighted Assets) |  |  |  |  |  |
Consolidated | 116,314 | 15.12% | 30,762 | 4.00% | n/a | n/a
Southern Bank | 105,281 | 13.81% | 30,484 | 4.00% | 45,726 | 6.00%
Tier I Capital (to Average Assets) |  |  |  |  |  |
Consolidated | 116,314 | 11.71% | 39,743 | 4.00% | n/a | n/a
Southern Bank | 105,281 | 10.69% | 39,379 | 4.00% | 49,224 | 5.00%
| Actual | For Capital Adequacy Purposes | To Be Well Capitalized Under Prompt Corrective Action Provisions
As of June 30, 2013 | Amount | Ratio | Amount | Ratio | Amount | Ratio
Total Capital (to Risk-Weighted Assets) |  |  |  |  |  |
Consolidated | $115,972 | 18.70% | $49,608 | 8.00% | n/a | n/a
Southern Bank | 92,618 | 15.10% | 49,059 | 8.00% | 61,324 | 10.00%
Tier I Capital (to Risk-Weighted Assets) |  |  |  |  |  |
Consolidated | 108,208 | 17.45% | 24,804 | 4.00% | n/a | n/a
Southern Bank | 84,938 | 13.85% | 24,529 | 4.00% | 36,794 | 6.00%
Tier I Capital (to Average Assets) |  |  |  |  |  |
Consolidated | 108,208 | 13.73% | 31,524 | 4.00% | n/a | n/a
Southern Bank | 84,938 | 10.87% | 31,250 | 4.00% | 39,063 | 5.00%
The Bank’s ability to pay dividends on its common stock to the Company is restricted to maintain adequate capital as shown in the above tables. Additionally, prior regulatory approval is required for the declaration of any dividends generally in excess of the sum of net income for that calendar year and retained net income for the preceding two calendar years. At June 30, 2014, approximately $18.7 million of the equity of the Bank was available for distribution as dividends to the Company without prior regulatory approval. In July 2014, the Bank declared and paid to the Company a special dividend of $10.0 million to facilitate the Company’s acquisition of Peoples Service Company.

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- Definition The entire disclosure for banks, savings institutions, and credit unions, for regulatory capital requirements imposed by the Federal Reserve System (FRB), the Federal Deposit Insurance Corporation (FDIC), the Office of Thrift Supervision (OTS) or for any state imposed capital requirements, as applicable. The disclosure may include (1) a description of regulatory capital requirements (a) for capital adequacy purposes and (b) established by the prompt corrective action provisions of Section 38 of the Federal Depository Insurance Act; (2) the actual or possible material effects of noncompliance with such requirements; (3) whether the entity is in compliance with the regulatory capital requirements including (a) required and actual ratios and amounts of Tier 1 leverage, Tier 1 risk-based, and total risk-based capital, tangible capital (for savings institutions), and Tier 3 capital for market risk (for certain banks and bank holding companies), (b) factors that may significantly affect capital adequacy; (4) the prompt corrective action category in which the entity was classified as of its most recent notification; (5) whether management believes any conditions or events since notification have changed the entity's category. Also may include additional information that might be disclosed in situations where substantial doubt about the entity's ability to continue as a going concern for a reasonable period of time. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 505 -Section 50 -Paragraph 1B -URI http://asc.fasb.org/extlink&oid=35709795&loc=SL5958570-112826 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 505 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=35709795&loc=SL5958568-112826 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 505 -Section 50 -Paragraph 1D -URI http://asc.fasb.org/extlink&oid=35709795&loc=SL5958573-112826 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 505 -Section 50 -Paragraph 1E -URI http://asc.fasb.org/extlink&oid=35709795&loc=SL5958574-112826 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 505 -Section 50 -Paragraph 1F -URI http://asc.fasb.org/extlink&oid=35709795&loc=SL5958575-112826 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 505 -Section 50 -Paragraph 1A -URI http://asc.fasb.org/extlink&oid=35709795&loc=SL5958569-112826 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 505 -Section 50 -Paragraph 1H -URI http://asc.fasb.org/extlink&oid=35709795&loc=d3e65071-112826 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 505 -Section 50 -Paragraph 1G -URI http://asc.fasb.org/extlink&oid=35709795&loc=SL5958577-112826 Reference 9: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 505 -Section 50 -Paragraph 1C -URI http://asc.fasb.org/extlink&oid=35709795&loc=SL5958572-112826 + Details
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