Capital Requirements

12 Months Ended

Dec. 31, 2023

Regulatory Capital Requirements Under Banking Regulations [Abstract]

Capital Requirements

Capital Requirements

First Guaranty Bank is 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 that, if undertaken, could have a direct material effect on First Guaranty's financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Bank must meet specific capital guidelines that involve quantitative measures of their assets, liabilities and certain off-balance sheet items as calculated under regulatory accounting practices. The capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings and other factors.

Quantitative measures established by regulation to ensure capital adequacy require the Bank to maintain minimum amounts and ratios of total and Tier 1 capital to risk-weighted assets and of Tier 1 capital to average assets. Management believes, as of December 31, 2023 and 2022, that the Bank met all capital adequacy requirements.

In addition to establishing the minimum regulatory capital requirements, the regulations limit capital distributions and certain discretionary bonus payments to management if the institution does not hold a "capital conservation buffer" consisting of 2.5% of common equity Tier 1 capital to risk-weighted assets above the amount necessary to meet its minimum risk-based capital requirements. First Guaranty Bank's capital conservation buffer was 3.20% at December 31, 2023.

In addition, as a result of the legislation, the federal banking agencies have developed a "Community Bank Leverage Ratio" (the ratio of a bank's Tier 1 capital to average total consolidated assets) for financial institutions with assets of less than $10 billion. A "qualifying community bank" that exceeds this ratio will be deemed to be in compliance with all other capital and leverage requirements, including the capital requirements to be considered "well capitalized" under Prompt Corrective Action statutes. The federal banking agencies may consider a financial institution's risk profile when evaluating whether it qualifies as a community bank for purposes of the capital ratio requirement. The federal banking agencies set the new Community Bank Leverage Ratio at 9%. Pursuant to the CARES Act, the federal banking agencies set the Community Bank Leverage Ratio at 8% beginning in the second quarter of 2020 through the end of 2020. Beginning in 2021, the Community Bank Leverage Ratio increased to 8.5% for the calendar year. Community banks will have until Jan. 1, 2022, before the Community Bank Leverage Ratio requirement will return to 9%. A financial institution can elect to be subject to this new definition. The new rule took effect on January 1, 2020. The Bank has not elected to follow the Community Bank Leverage Ratio.

As of December 31, 2023, the most recent notification from the Federal Deposit Insurance Corporation categorized the Bank as well capitalized under the regulatory framework for prompt corrective action. To be categorized as well capitalized, an institution must maintain minimum total risk-based, Tier 1 risk-based and Tier 1 leverage ratios as set forth in the following table. There are no conditions or events since the notification that Management believes have changed the Bank's category. First Guaranty Bank's actual capital amounts and ratios as of December 31, 2023 and 2022 are presented in the following table.

	Actual				Minimum Capital Requirements				Minimum to be Well Capitalized Under Action Provisions
(in thousands except for %)	Amount		Ratio		Amount		Ratio		Amount		Ratio
December 31, 2023
Total Risk-based Capital:	$	330,944	11.20	%	$	236,321	8.00	%	$	295,402	10.00	%
Tier 1 Capital:	$	304,553	10.31	%	$	177,241	6.00	%	$	236,321	8.00	%
Tier 1 Leverage Capital:	$	304,553	8.94	%	$	121,821	4.00	%	$	152,277	5.00	%
Common Equity Tier One Capital:	$	304,553	10.31	%	$	132,931	4.50	%	$	192,011	6.50	%
December 31, 2022
Total Risk-based Capital:	$	308,510	11.16	%	$	221,066	8.00	%	$	276,333	10.00	%
Tier 1 Capital:	$	284,992	10.31	%	$	165,800	6.00	%	$	221,066	8.00	%
Tier 1 Leverage Capital:	$	284,992	9.35	%	$	121,884	4.00	%	$	152,355	5.00	%
Common Equity Tier One Capital:	$	284,992	10.31	%	$	124,350	4.50	%	$	179,616	6.50	%