XML 47 R21.htm IDEA: XBRL DOCUMENT v3.25.0.1
Shareholders' Equity
 12 Months Ended
Dec. 31, 2024
Equity [Abstract]  
Shareholders' Equity Shareholders' Equity
Shares Authorized and Share Issuance

The Company's authorized capital is divided into common stock and preferred stock. The Company is authorized to issue 40,000,000 shares of common stock, with a par value of $0.01 per share, and as of December 31, 2024, shares issued and outstanding amounted to 12,447,308. Holders of common stock are entitled to one vote per share and are entitled to receive dividends if, as and when declared by the Board. Dividend and liquidation rights of the common stock may be subject to the rights of any outstanding preferred stock. The Company is also authorized to issue 1,000,000 shares of preferred stock, with a par value of $0.01 per share. No preferred stock has been issued as of the date of this Form 10-K.

The Company previously had a shareholders' rights plan pursuant to which each share of Company common stock included a right to purchase under certain circumstances a fraction of a share of the Company's Series A Junior Participating Preferred Stock, par value $0.01 per share. In December 2024, the Company amended its shareholders' rights plan to provide for the expiration of such rights on December 7, 2024, effectively terminating the plan.

The Company's stock incentive plans permit the Board to grant, under various terms, stock options (for the purchase of newly issued shares of common stock), common stock, restricted stock awards, restricted stock units and stock appreciation rights to officers and other employees, non-employee directors and consultants. See Note 14, "Stock-Based Compensation," to the Company's consolidated financial statements of this Form 10-K, contained below, for additional information regarding the Company's stock incentive plans.
Capital

Capital planning by the Company and the Bank considers current needs and anticipated future growth. Ongoing sources of capital include the retention of earnings, less dividends paid, proceeds from the exercise of employee stock options and proceeds from purchases of shares pursuant to the DRSPP. Additional sources of capital for the Company and the Bank have been proceeds from the issuance of common stock and proceeds from the issuance of subordinated debt. The Company believes its current capital is adequate to support ongoing operations.

Management believes, as of December 31, 2024, that the Company and the Bank met all capital adequacy requirements to which they were subject. As of December 31, 2024 and December 31, 2023, the Company met the definition of "well-capitalized" under the applicable Federal Reserve Board regulations and the Bank qualified as "well-capitalized" under the prompt corrective action regulations of Basel III and the FDIC.

The Company's and the Bank's actual capital amounts and ratios are presented as of December 31, 2024 and December 31, 2023 in the tables below:
 Actual
Minimum Capital
for Capital
Adequacy
Purposes(1)
Minimum Capital
to be
Well-Capitalized(2)
(Dollars in thousands)AmountRatioAmountRatioAmountRatio
As of December 31, 2024      
The Company      
Total Capital to risk-weighted assets$546,283 13.06 %$334,522 8.00 %N/AN/A
Tier 1 Capital to risk-weighted assets434,006 10.38 %250,892 6.00 %N/AN/A
Tier 1 Capital to average assets (or Leverage Ratio)434,006 8.94 %194,242 4.00 %N/AN/A
Common Equity Tier 1 Capital to risk-weighted assets434,006 10.38 %188,169 4.50 %N/AN/A
The Bank      
Total Capital to risk-weighted assets$544,937 13.03 %$334,522 8.00 %$418,153 10.00 %
Tier 1 Capital to risk-weighted assets492,475 11.78 %250,892 6.00 %334,522 8.00 %
Tier 1 Capital to average assets (or Leverage Ratio)492,475 10.14 %194,242 4.00 %242,802 5.00 %
Common Equity Tier 1 Capital to risk-weighted assets492,475 11.78 %188,169 4.50 %271,799 6.50 %

 Actual
Minimum Capital
for Capital
Adequacy
Purposes(1)
Minimum Capital
to be
Well-Capitalized(2)
(Dollars in thousands)AmountRatioAmountRatioAmountRatio
As of December 31, 2023      
The Company      
Total Capital to risk-weighted assets$511,692 13.12 %$312,035 8.00 %N/AN/A
Tier 1 Capital to risk-weighted assets403,224 10.34 %234,026 6.00 %N/AN/A
Tier 1 Capital to average assets (or Leverage Ratio)403,224 8.74 %184,471 4.00 %N/AN/A
Common Equity Tier 1 Capital to risk-weighted assets403,224 10.34 %175,520 4.50 %N/AN/A
The Bank      
Total Capital to risk-weighted assets$510,645 13.09 %$312,035 8.00 %$390,044 10.00 %
Tier 1 Capital to risk-weighted assets461,675 11.84 %234,026 6.00 %312,035 8.00 %
Tier 1 Capital to average assets (or Leverage Ratio)461,675 10.01 %184,471 4.00 %230,589 5.00 %
Common Equity Tier 1 Capital to risk-weighted assets461,675 11.84 %175,520 4.50 %253,528 6.50 %
__________________________________________
(1)    Before application of the capital conservation buffer of 2.50%. See discussion below.
(2)    For the Bank to qualify as "well-capitalized," it must maintain at least the minimum ratios listed under the regulatory prompt corrective action framework. This framework does not apply to the Company.
The Company is subject to the Basel III capital ratio requirements, which include a "capital conservation buffer" of 2.50% above the regulatory minimum risk-based capital adequacy requirements shown above. If a banking organization dips into its capital conservation buffer it may be restricted in its activities, including its ability to pay dividends and discretionary bonus payments to its executive officers. Both the Company's and the Bank's actual ratios, as outlined in the table above, exceeded the Basel III risk-based capital requirement with the capital conservation buffer as of December 31, 2024.

The Basel III minimum capital ratio requirements as applicable to the Company and the Bank with the capital conservation buffer are summarized in the table below:
Basel III Minimum for Capital Adequacy PurposesBasel III Additional Capital Conservation BufferBasel III "Adequate" Ratio with Capital Conservation Buffer
Total Capital to RWA8.00%2.50%10.50%
Tier 1 Capital to RWA6.00%2.50%8.50%
Tier 1 Capital to AA, or Leverage Ratio4.00%N/A4.00%
Common equity tier 1 capital to RWA4.50%2.50%7.00%

Failure to meet minimum capital requirements can initiate or result in certain mandatory and possibly additional discretionary supervisory actions by regulators that, if undertaken, could have a material adverse effect on the Company's consolidated financial statements. Under applicable capital adequacy requirements and the regulatory framework for prompt corrective action applicable to the Bank, 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 classifications are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors.

See also "Supervision and Regulation," contained in Item 1, "Business," of this Form 10-K for further information on the Company's Basel III and capital requirements.

Dividends

For the year ended December 31, 2024, the Company declared $11.9 million in cash dividends and shareholders utilized the dividend reinvestment portion of the DRSPP to purchase an aggregate of 54,698 shares of the Company's common stock totaling $1.6 million. For the year ended December 31, 2023, the Company declared $11.2 million in cash dividends and shareholders utilized the dividend reinvestment portion of the DRSPP to purchase 50,443 shares of the Company's common stock totaling $1.5 million. For the year ended December 31, 2022, the Company declared $9.9 million in cash dividends and shareholders utilized the dividend reinvestment portion of the DRSPP to purchase 40,640 shares of the Company's common stock totaling $1.4 million. See "Shares Authorized and Share Issuance" above in this Note 12 of this Form 10-K for more information on the DRSPP, including the direct stock purchase component of the plan.