Equity and Regulatory Matters

9 Months Ended

Sep. 30, 2019

Banking and Thrift [Abstract]

Equity and Regulatory Matters

NOTE 16 – EQUITY AND REGULATORY MATTERS

The 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 by regulators that, if undertaken, could have a direct material effect on the Bank’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 their 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 that the Bank met all applicable capital adequacy requirements as of September 30, 2019 and December 31, 2018.

As of September 30, 2019 and December 31, 2018, the Bank was 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 below. The Bank’s actual and required capital amounts and ratios are presented below:

	September 30, 2019
	Actual					For Capital Adequacy Purposes					To Be Well Capitalized Under Prompt Corrective Action Provisions
	Amount		Ratio			Amount		Ratio			Amount		Ratio
	(dollars in thousands)
Leverage (Tier 1)	$	45,597		9.9	%	$	18,367		4.0	%	$	22,959		5.0	%
Risk-based:
Common Equity Tier 1		45,597		13.1	%		15,702		4.5	%		22,681		6.5	%
Tier 1		45,597		13.1	%		20,936		6.0	%		27,915		8.0	%
Total		48,615		13.9	%		27,915		8.0	%		34,894		10.0	%
	December 31, 2018
	Actual					For Capital Adequacy Purposes					To Be Well Capitalized Under Prompt Corrective Action Provisions
	Amount		Ratio			Amount		Ratio			Amount		Ratio
	(dollars in thousands)
Leverage (Tier 1)	$	35,955		7.5	%	$	19,110		4.0	%	$	23,887		5.0	%
Risk-based:
Common Equity Tier 1		35,955		10.0	%		16,153		4.5	%		23,333		6.5	%
Tier 1		35,955		10.0	%		21,538		6.0	%		28,717		8.0	%
Total		39,217		10.9	%		28,717		8.0	%		35,897		10.0	%