Regulatory Matters

12 Months Ended

Sep. 30, 2020

Transfers and Servicing of Financial Assets [Abstract]

Regulatory Matters

Regulatory Matters

The Company and the Bank are 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 and the Bank’s financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company and the Bank must meet specific capital guidelines that involve quantitative measures of the Company’s and the Bank’s assets, liabilities, and certain off-balance sheet items as calculated under regulatory accounting practices. The Company’s and the Bank’s capital amounts and classifications are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors. Factors that may significantly affect adequacy of net worth such as potentially volatile components of capital, qualitative factors or regulatory mandates are discussed in "Item 1A. Risk Factors". On January 1, 2015, the Company became subject to Basel III rules, which included transition provisions through January 1, 2019.

The minimum capital level requirements applicable to the Company are: (i) a Tier 1 capital ratio of 6.0%; (ii) a total capital ratio of 8.0%; (iii) a Tier 1 leverage capital ratio of 4.0%; and (iv) a common equity Tier 1 capital ratio of 4.5%. The rules also established a "capital conservation buffer" of 2.5% above the minimum capital requirements, which must consist entirely of common equity Tier 1 capital and results in the following minimum ratios: (i) a Tier 1 capital ratio of 8.5%; (ii) a total capital ratio of 10.5%; and (iii) a common equity Tier 1 capital ratio of 7.0%. The capital conservation buffer requirement was phased in beginning in January 2016 at 0.625% of risk-weighted assets and increased by that amount each year until fully implemented in January 2019. An institution is subject to limitations on paying dividends, engaging in share repurchases, and paying discretionary bonuses if its capital level falls below the buffer amount. These limitations establish a maximum percentage of eligible retained income that could be utilized for such actions.

The Company met all capital adequacy and net worth requirements to which they are subject as of September 30, 2020 and 2019.

As of September 30, 2020, the most recent notification from the regulatory agencies categorized the Bank as well capitalized under the regulatory framework for prompt corrective action. To be categorized as well-capitalized, the 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 most recent notification that management believes have changed the Bank's categories.

As an approved mortgage seller, the Bank is required to maintain a minimum level of capital specified by the United States Department of Housing and Urban Development. At September 30, 2020 and 2019, the Bank met these requirements.

Capital amounts and ratios are presented in the following table:

	Actual				Minimum Capital Requirement Ratio ¹				To Be Well Capitalized Under Prompt Corrective Action Provisions
	Amount		Ratio		Amount		Ratio		Amount		Ratio
	(dollars in thousands)
As of September 30, 2020
Tier 1 risk based capital (to risk-weighted assets):
Consolidated	$	1,195,453	11.8	%	$	609,080	6.0	%	N/A		N/A
Bank	1,187,905		11.7	%	608,916		6.0	%	$	811,888	8.0	%
Total risk based capital (to risk-weighted assets):
Consolidated	1,350,658		13.3	%	812,107		8.0	%	N/A		N/A
Bank	1,315,077		13.0	%	811,888		8.0	%	1,014,860		10.0	%
Tier 1 leverage capital (to average assets):
Consolidated	1,195,453		9.4	%	511,248		4.0	%	N/A		N/A
Bank	1,187,905		9.3	%	509,649		4.0	%	637,062		5.0	%
Common Equity Tier 1 risk based capital (to risk-weighted assets):
Consolidated	1,121,621		11.0	%	456,810		4.5	%	N/A		N/A
Bank	$	1,187,905	11.7	%	$	456,687	4.5	%	$	659,659	6.5	%

	Actual				Minimum Capital Requirement Ratio ¹				To Be Well Capitalized Under Prompt Corrective Action Provisions
	Amount		Ratio		Amount		Ratio		Amount		Ratio
	(dollars in thousands)
As of September 30, 2019
Tier 1 risk based capital (to risk-weighted assets):
Consolidated	$	1,225,355	11.7	%	$	627,493	6.0	%	N/A		N/A
Bank	1,201,476		11.5	%	627,311		6.0	%	$	836,415	8.0	%
Total risk based capital (to risk-weighted assets):
Consolidated	1,331,611		12.7	%	836,658		8.0	%	N/A		N/A
Bank	1,272,733		12.2	%	836,415		8.0	%	1,045,519		10.0	%
Tier 1 leverage capital (to average assets):
Consolidated	1,225,355		10.1	%	483,487		4.0	%	N/A		N/A
Bank	1,201,476		9.9	%	483,957		4.0	%	604,946		5.0	%
Common Equity Tier 1 risk based capital (to risk-weighted assets):
Consolidated	1,151,658		11.0	%	470,620		4.5	%	N/A		N/A
Bank	$	1,201,476	11.5	%	$	470,483	4.5	%	$	679,587	6.5	%
1 Does not include capital conservation buffer of 2.5% at both September 30, 2020 and 2019.