Shareholders' Equity

3 Months Ended

Mar. 31, 2012

Equity [Abstract]

Shareholders' Equity

Shareholders' Equity

The Bank, as a North Carolina banking corporation, may pay dividends only out of undivided profits as determined pursuant to North Carolina General Statutes Section 53‑87. At March 31, 2012 and 2011, there were no undivided profits available for dividend payments. The Bank is currently prohibited from paying dividends to the holding company without prior FDIC and NC Banking Commissioner approval. The Company has committed to regulators that the Bank will maintain a Tier 1 Leverage Ratio of 8%. The Company deferred dividend payments on its Series T and Series T-ACB Preferred Stock and interest payment on the trust preferred securities in the second, third and fourth quarters of 2011 and the first quarter of 2012. The total amount of deferred dividends payments as of March 31, 2012 was $2.8 million and is recorded in other liabilities. The Company may be required to continue to defer dividend payments on its Series T and Series T-ACB Preferred Stock and interest payments on the trust preferred securities in the future given liquidity levels at the holding company. Because the Company deferred dividend payments on the Series T and Series T-ACB Preferred Stock and deferred interest payments on its trust preferred securities, the Company is prohibited from paying any dividends on its common stock until all deferred payments have been made in full. If the Company defers six dividend payments on its Series T and Series T-ACB Preferred Stock, the holder of the stock will have the right to appoint two individuals to the board of directors.