Regulatory Capital Matters

12 Months Ended

Dec. 31, 2011

Restrictions on Cash Balance Disclosure [Abstract]

Regulatory Capital Matters

(19)   Regulatory Capital Matters

The Company is 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 risk components, asset risk weighting and other factors.

Risk-based capital guidelines issued by the FDIC establish a risk-adjusted ratio relating capital to different categories of assets and off-balance sheet exposures for banks. The Bank's Tier 1 capital is comprised primarily of common equity and trust preferred securities, and excludes the equity impact of adjusting available-for-sale securities to fair value. Total capital also includes a portion of the allowance for loan losses, as defined according to regulatory guidelines. In addition, under Washington State banking regulations, the Bank is limited as to the ability to declare or pay dividends to the Company up to the amount of the Bank's retained earnings then on hand. Quantitative measures established by regulation to ensure capital adequacy require the Bank to maintain minimum amounts and ratios (set forth in the following table) of total and Tier 1 capital to risk-weighted assets (as defined in the regulations), and of Tier 1 capital to average assets (as defined in the regulations). As of December 31, 2011, the Company and Bank met the minimum capital requirements to which it is subject and is considered to be “well-capitalized.”

The following tables describe the Company's and Bank's regulatory capital and threshold requirements:

	Actual					For capital adequacy purposes					To be well-capitalized under prompt corrective action provisions
December 31, 2011	Amount		Ratio			Amount		Minimum Ratio			Amount		Minimum Ratio
Total risk-based capital ratio
Company (consolidated)	$	198,392		19.73	%	$	80,463		8.00	%		N/A
Whidbey Island Bank		191,816		19.09	%		80,366		8.00	%		100,458		10.00	%
Tier 1 risk-based capital ratio
Company (consolidated)		185,741		18.47	%		40,231		4.00	%		N/A
Whidbey Island Bank		179,180		17.84	%		40,183		4.00	%		60,275		6.00	%
Tier 1 leverage ratio
Company (consolidated)		185,741		11.16	%		66,546		4.00	%		N/A
Whidbey Island Bank		179,180		10.77	%		66,542		4.00	%		83,178		5.00	%

	Actual					For capital adequacy purposes					To be well-capitalized under prompt corrective action provisions
December 31, 2010	Amount		Ratio			Amount		Minimum Ratio			Amount		Minimum Ratio
Total risk-based capital ratio
Company (consolidated)	$	211,751		20.96	%	$	80,813		8.00	%		N/A
Whidbey Island Bank		209,769		20.78	%		80,756		8.00	%		100,946		10.00	%
Tier 1 risk-based capital ratio
Company (consolidated)		199,048		19.70	%		40,407		4.00	%		N/A
Whidbey Island Bank		197,074		19.52	%		40,378		4.00	%		60,567		6.00	%
Tier 1 leverage ratio
Company (consolidated)		199,048		11.42	%		69,703		4.00	%		N/A
Whidbey Island Bank		197,074		11.30	%		69,746		4.00	%		87,182		5.00	%