Note 13: Regulatory Matters and Trust Preferred Securities

As of December 31, 2015, based on its call report computations, State Bank was classified as well capitalized under the regulatory framework for prompt corrective action. To be categorized as well capitalized, State Bank must maintain capital ratios as set forth in the table below. There are no conditions or events since December 31, 2015 that management believes have changed State Bank’s capital classification.

State Bank’s actual capital amounts and ratios are presented in the following table. Capital levels are presented for the State Bank only as the Company is now exempt from quarterly reporting at the holding company level:

	Actual					For Capital Adequacy Purposes					To Be Well Capitalized Under Prompt Corrective Action Procedures
($ in thousands)	Amount		Ratio			Amount		Ratio			Amount		Ratio
As of December 31, 2015
Tier I Capital to average assets	$	64,914		9.10	%	$	28,534		4.0	%	$	35,668		5.0	%
Tier I Common equity capital to risk-weighted assets		64,914		10.23	%		28,545		4.5	%		41,231		6.5	%
Tier I Capital to risk-weighted assets		64,914		10.23	%		38,059		6.0	%		50,746		8.0	%
Total Risk-based capital to risk-weighted assets		71,904		11.34	%		50,746		8.0	%		63,432		10.0	%

As of December 31, 2014
Tier I Capital to average assets		57,591		8.55	%		27,354		4.0	%		33,333		5.0	%
Tier I Capital to risk-weighted assets		57,591		10.73	%		21,253		4.0	%		31,879		6.0	%
Total Risk-based capital to risk-weighted assets		63,664		11.98	%		42,506		8.0	%		53,132		10.0	%

On September 7, 2014, the Company redeemed its fixed rate trust preferred securities of $10.3 million using a portion of the $14.0 million in proceeds of the Company’s capital raise completed on December 22, 2014, through the public offering of depository shares, each representing a 1/100^th interest in the Company’s 6.50 percent Noncumulative Convertible Preferred Shares, Series A.