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Regulatory Matters and Stockholders' Equity
 12 Months Ended
Dec. 31, 2014
Regulatory Matters and Stockholders' Equity [Abstract]  
REGULATORY MATTERS AND STOCKHOLDERS' EQUITY

NOTE 10 - REGULATORY MATTERS AND STOCKHOLDERS’ EQUITY

The Company and Bank 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’s financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company must meet specific capital guidelines that involve quantitative measures of the Company’s assets, liabilities and certain off-balance sheet items as calculated under regulatory accounting practices. The Company’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 (set forth in the table below) of total and Tier 1 capital (as defined in the regulations) to risk-weighted assets, and of Tier 1 capital to average assets. Management believes, as of December 31, 2014 and 2013, that the Company and the Bank meet all capital adequacy requirements to which they are subject.

 

As of December 31, 2014, the most recent notification from the regulators has 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 category.

 

The Bank’s actual capital amounts and ratios are presented in the table:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

To be Well Capitalized

 

 

 

 

 

 

 

 

under Prompt

 

 

 

 

 

For Capital Adequacy

 

Corrective Action

 

Actual

 

Purposes

 

Provision

 

Amount

 

Ratio

 

Amount

 

Ratio

 

Amount

 

Ratio

 

(Dollars  in Thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As of December 31, 2014:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total capital (to risk-weighted assets)

$
89,613 

 
17.59 

%

 

≥$40,767

 

≥8.00

%

 

≥$50,959

 

≥10.00

%

Tier 1 capital (to risk-weighted assets)

 
83,738 

 
16.43 

 

 

≥20,383

 

≥4.00

 

 

≥30,575

 

≥6.00

 

Tier 1 capital (to average assets)

 
83,738 

 
11.93 

 

 

≥28,069

 

≥4.00

 

 

≥35,086

 

≥5.00

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As of December 31, 2013:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total capital (to risk-weighted assets)

$
85,667 

 
16.86 

%

 

≥$40,660

 

≥8.00

%

 

≥$50,825

 

≥10.00

%

Tier 1 capital (to risk-weighted assets)

 
79,959 

 
15.73 

 

 

≥20,330

 

≥4.00

 

 

≥30,495

 

≥6.00

 

Tier 1 capital (to average assets)

 
79,959 

 
11.51 

 

 

≥27,792

 

≥4.00

 

 

≥34,740

 

≥5.00

 

 

 

The Company’s ratios do not differ significantly from the Bank’s ratios presented above.

 

The Bank is required to maintain average cash reserve balances in vault cash or with the Federal Reserve Bank. The amount of these restricted cash reserve balances at December 31, 2014 and 2013 was approximately $368,000 and $480,000, respectively.

 

Under Pennsylvania banking law, the Bank is subject to certain restrictions on the amount of dividends that it may declare without prior regulatory approval. At December 31, 2014,  $62,914,000 of retained earnings were available for dividends without prior regulatory approval, subject to the regulatory capital requirements discussed above. Under Federal Reserve regulations, the Bank is limited as to the amount it may lend affiliates, including the Company, unless such loans are collateralized by specific obligations.