Regulatory Capital

12 Months Ended

Dec. 31, 2016

FDIC Loss-Sharing Related

Regulatory Capital

Note 13 Regulatory Capital 

As a bank holding company, the Company is subject to the regulatory capital adequacy requirements implemented by the Federal Reserve. The federal banking agencies have risk-based capital adequacy regulations intended to provide a measure of capital adequacy that reflects the degree of risk associated with a banking organization’s operations. Under these regulations, assets are assigned to one of several risk categories, and nominal dollar amounts of assets and credit equivalent amounts of off-balance-sheet items are multiplied by a risk adjustment percentage for the category. 

The new Basel III rules, effective January 1, 2015, changed the components of regulatory capital and changed the way in which risk ratings are assigned to various categories of bank assets. Also, a new Tier 1 common risk-based ratio was defined. Under the Basel III requirements, at December 31, 2016, the Company and the Bank met all capital requirements and the Bank had regulatory capital ratios in excess of the levels established for well-capitalized institutions.

In February 2016, the Bank received approval from the Colorado Division of Banking and the Federal Reserve Bank of Kansas City to permanently reduce the Bank's capital by $140.0 million. As a result, the Bank distributed $140.0 million in cash to the Company in February 2016.

At December 31, 2016 and 2015, the Bank met the requirements to be considered “well capitalized” under the regulatory framework for prompt corrective action. To be categorized as “well capitalized”, the Bank must maintain capital ratios as set forth in the table below. The following table sets forth the capital ratios of the Company and the Bank at December 31, 2016 and 2015:

	December 31, 2016
				Required to be			Required to be
				well capitalized under			considered
				prompt corrective			adequately
	Actual			action provisions			capitalized
	Ratio	Amount		Ratio	Amount		Ratio	Amount
Tier 1 leverage ratio:
Consolidated	10.4%	$	470,259	N/A		N/A	4.0%	$	181,019
NBH Bank	8.6%		389,189	4.5%	$	202,903	4.0%		180,358
Common equity tier 1 risk-based capital:
Consolidated	14.2%	$	470,259	N/A		N/A	4.5%	$	203,647
NBH Bank	11.8%		389,189	6.5%	$	293,082	4.5%		202,903
Tier 1 risk-based capital ratio:
Consolidated	14.2%	$	470,259	N/A		N/A	6.0%	$	199,467
NBH Bank	11.8%		389,189	8.0%	$	264,596	6.0%		198,447
Total risk-based capital ratio:
Consolidated	15.0%	$	499,759	N/A		N/A	8.0%	$	265,955
NBH Bank	12.7%		418,689	10.0%	$	330,745	8.0%		264,596

(1)

	December 31, 2015
				Required to be			Required to be
				well capitalized under			considered
				prompt corrective			adequately
	Actual			action provisions			capitalized
	Ratio	Amount		Ratio	Amount		Ratio	Amount
Tier 1 leverage ratio:
Consolidated	11.8%	$	550,368	N/A		N/A	4.0%	$	187,325
NBH Bank	11.2%		519,766	5.0%	$	464,078	4.0%		185,631
Common equity tier 1 risk-based capital:
Consolidated	17.5%	$	550,368	N/A		N/A	4.5%	$	210,741
NBH Bank	16.6%		519,766	6.5%	$	301,651	4.5%		208,835
Tier 1 risk-based capital ratio:
Consolidated	17.5%	$	550,368	N/A		N/A	6.0%	$	189,101
NBH Bank	16.6%		519,766	8.0%	$	344,989	6.0%		188,176
Total risk-based capital ratio:
Consolidated	18.4%	$	578,448	N/A		N/A	8.0%	$	252,134
NBH Bank	17.5%		547,846	10.0%	$	376,352	8.0%		250,901