XML 41 R23.htm IDEA: XBRL DOCUMENT v3.3.1.900
Capital Requirements
 12 Months Ended
Dec. 31, 2015
Capital Requirements  
Capital Requirements
(14) Capital Requirements

 

The Company and the Bank are subject to various regulatory capital requirements administered by federal and state 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 consolidated financial statements. Under capital adequacy guidelines, the Company and the Bank must meet specific capital guidelines that involve quantitative measures of assets, liabilities, and certain off-balance-sheet items as calculated under regulatory accounting practices. The capital amounts and classification of the Company and the Bank are subject to qualitative judgments by the regulators about components, risk-weightings, and other factors.

 

Quantitative measures established by regulations to ensure capital adequacy require the Company and the Bank to maintain minimum amounts and ratios (set forth in the following table) of total and Tier I capital to risk-weighted assets, and of Tier I capital to adjusted-average assets. Management believes, as of December 31, 2015 and 2014, the Company and the Bank met all capital adequacy requirements.
 
In July 2013, the federal bank regulators approved final rules (the “Basel III Rule”) implementing Basel III framework as well as certain provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act. The Basel III Rule also substantially revises the risk-based capital requirements applicable to bank holding companies and their depository institution subsidiaries, including the Company and the Bank, as compared to the general risk-based capital rules. The Basel III Rule revises the components of capital and addresses other issues affecting the numerator in regulatory capital ratios. The Basel III Rule also address asset risk weights and other issues affecting the denominator in regulatory capital ratios and replace the existing general risk-weighting approach based on Basel I with a more risk-sensitive approach. The Basel III Rule became effective for the Company and the Bank on January 1, 2015 (subject to a phase-in period for certain provisions). As of December 31, 2015, the capital ratios (as set forth in the table below) are calculated under the new Basel III rules. As of December 31, 2014, the capital ratios (as set forth in the table below) are calculated under the former Basel I rules 
 
As of December 31, 2015, the most recent notification from the regulatory authorities 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 I risk-based, and Tier I leverage ratios as set forth in the table. There are no conditions or events since the notification that management believes have changed the Bank’s categories.
                      Well-Capitalized Under  
          Required for Capital     Prompt Corrective Action  
    Actual     Adequacy Purposes     Provision  
(in thousands)   Amount     Ratio     Amount     Ratio     Amount     Ratio  
December 31, 2015                                                
Total Capital (to risk-weighted assets):                                                
Company   $ 146,068       14.78 %   $ 79,066       8.00 %   $ N.A.       N.A. % 
Bank     137,572       13.98       78,718       8.00       98,398       10.00  
Tier I Capital (to risk-weighted assets):                                                
Company   $ 118,875       12.03 %   $ 59,299       6.00 %   $ N.A.       N.A. % 
Bank     128,808       13.09       59,039       6.00       78,718       8.00  
Common Equity Tier I Capital (to risk-weighted assets)                                                
Company   $ 89,304       9.02 %   $ 44,475       4.50 %   $ N.A.       N.A. % 
Bank     128,808       13.09       44,279       4.50       63,959       6.50  
Tier I leverage ratio:                                                
Company   $ 118,875       9.84 %   $ 48,314       4.00 %   $ N.A.       N.A. % 
Bank     128,808       10.73       48,025       4.00       60,031       5.00  
                                                 
(in thousands)                                                
December 31, 2014                                                
Total Capital (to risk-weighted assets):                                                
Company   $ 138,619       15.78 %   $ 70,282       8.00 %     N.A.       N.A. % 
Bank     128,311       14.78       69,430       8.00     $ 86,788       10.00  
Tier I Capital (to risk-weighted assets):                                                
Company   $ 108,785       12.38 %   $ 35,141       4.00 %     N.A.       N.A. % 
Bank     119,212       13.74       34,715       4.00     $ 52,073       6.00  
Tier I leverage ratio:                                                
Company   $ 108,785       9.42 %   $ 46,197       4.00 %   $ N.A.       N.A. % 
Bank     119,212       10.42       45,784       4.00       57,230       5.00