Equity and Regulatory Matters

12 Months Ended

Dec. 31, 2019

Equity and Regulatory Matters

Equity and Regulatory Matters

NOTE 16 – Equity and Regulatory Matters

The Bank is subject to various regulatory capital requirements administered by 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 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 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 (set forth in the table below) of Common Equity Tier 1, Tier 1, and Total capital to risk-weighted assets and of Tier 1 capital to average assets. It is management’s opinion, as of December 31, 2019, that the Bank meet all applicable capital adequacy requirements.

As of December 31, 2019, the Bank is categorized as well capitalized under the regulatory framework for prompt corrective action. To be categorized as well capitalized, the Bank must maintain minimum regulatory capital ratios as set forth in the table. There are no conditions or events since December 31, 2019 that management believes have changed the category.

The Bank’s actual capital amounts and ratios are presented in the following tables:

					For Capital Adequacy				To Be Well Capitalized
	Actual				Purposes				Under Prompt Corrective Action Provisions
	Amount		Ratio		Amount		Ratio		Amount		Ratio
December 31, 2019:
First Federal Bank of Wisconsin
Leverage (Tier 1)	$	50,446	19.4	%	$	10,400	4.0	%	$	13,000	5.0	%
Risk Based:
Common Tier 1		50,446	23.7			9,591	4.5			13,854	6.5
Tier 1		50,446	23.7			12,788	6.0			17,051	8.0
Total		52,710	24.7			17,051	8.0			21,313	10.0
December 31, 2018:
First Federal Bank of Wisconsin
Leverage (Tier 1)	$	48,502	18.4	%	$	10,542	4.0	%	$	13,178	5.0	%
Risk Based:
Common Tier 1		48,502	23.7			9,209	4.5			13,302	6.5
Tier 1		48,502	23.7			12,279	6.0			16,372	8.0
Total		50,620	24.7			16,372	8.0			20,465	10.0