Regulatory Matters

12 Months Ended

Dec. 31, 2021

Regulatory Matters [Abstract]

Regulatory Matters

Note 16. Regulatory Matters

Information presented for December 31, 2021 and December 31, 2020, reflects the Basel III capital requirements that became effective January 1, 2015 for the Bank. Under these capital requirements and the regulatory framework for prompt corrective action, the Bank must meet specific capital guidelines that involve quantitative measures of the Bank’s assets, liabilities and certain off-balance-sheet items as calculated under regulatory accounting practices. The Bank’s capital amounts and classifications are also subject to qualitative judgments by regulators about components, risk- weightings and other factors.

The Basel III Capital Rules, a comprehensive capital framework for U.S. banking organizations, became effective for the Company and the Bank on January 1, 2015 (subject to a phase-in period for certain provisions). Under the Basel III rules, the Company must hold a capital conservation buffer above the adequately capitalized risk-based capital ratios. The capital conservation buffer was phased in from 0.0% for 2015 to 2.50% by 2019. The capital conservation buffer for 2020 and 2021 is 2.50%. Quantitative measures established by regulation to ensure capital adequacy require the Company to maintain minimum amounts and ratios of Total capital, Common Equity Tier 1 capital, and Tier 1 capital (as defined in the regulations) to risk weighted assets (as defined), and of Tier 1 capital (as defined) to average assets (as defined). Management believes, as of December 31, 2021, the Company and the Bank meets all capital adequacy requirements to which it is subject.

The Bank’s actual capital amounts and ratios are presented in the table (dollars in thousands):

	Actual					Capital Adequacy Purposes			To Be Well Capitalized Under the Prompt Corrective Action Provision
(Dollars in thousands)	Amount		Ratio			Amount		Ratio	Amount		Ratio
As of December 31, 2021
Total capital (to risk-weighted assets)	$	227,359		16.06	%	$	113,249	≥ 8.0%	$	141,562	≥ 10.0%
Common equity tier 1 capital (to risk-weighted assets)	$	215,662		15.23	%	$	63,703	≥ 4.5%	$	113,249	≥ 8.0%
Tier 1 capital (to risk-weighted assets)	$	215,662		15.23	%	$	84,937	≥ 6.0%	$	113,249	≥ 8.0%
Tier 1 capital (to average assets)	$	215,662		12.90	%	$	66,898	≥ 4.0%	$	83,622	≥ 5.0%
As of December 31, 2020
Total capital (to risk-weighted assets)	$	189,534		14.60	%	$	103,872	≥ 8.0%	$	129,840	≥ 10.0%
Common equity tier 1 capital (to risk-weighted assets)	$	176,657		13.61	%	$	58,428	≥ 4.5%	$	103,872	≥ 8.0%
Tier 1 capital (to risk-weighted assets)	$	176,657		13.61	%	$	77,904	≥ 6.0%	$	103,872	≥ 8.0%
Tier 1 capital (to average assets)	$	176,657		10.78	%	$	65,557	≥ 4.0%	$	81,946	≥ 5.0%