Regulatory Capital Requirements

6 Months Ended

Jun. 30, 2023

Regulatory Capital Requirements [Abstract]

(10) Regulatory Capital Requirements

Banks and bank holding companies are subject to regulatory capital requirements administered by federal banking agencies. Capital adequacy regulations and, additionally for banks, the prompt corrective action regulations, involve quantitative measures of assets, liabilities, and certain off-balance-sheet items calculated under regulatory accounting practices. Capital amounts and classifications are also subject to qualitative judgments by regulators. Failure to meet capital requirements can result in regulatory action. As of June 30, 2023, the Company and Bank meet all capital adequacy requirements to which they are subject.

Prompt corrective action regulations provide five classifications: well capitalized, adequately capitalized, undercapitalized, significantly undercapitalized, and critically undercapitalized, although these terms are not used to represent overall financial condition. If a bank is not classified as well capitalized, regulatory approval is required to accept brokered deposits. If a bank is undercapitalized, capital distributions are limited, as is asset growth and expansion, and capital restoration plans are required. The federal banking agencies are required to take certain supervisory actions (and may take additional discretionary actions) with respect to an undercapitalized institution or its holding company. Such actions could have a direct material effect on an institution’s or its holding company’s financial statements. As of June, 2023 and December 31, 2022, the most recent regulatory notifications categorized the Bank as well capitalized under the regulatory framework for prompt corrective action. There are no conditions or events since that notification that management believes have changed the Bank’s category.

The Bank and the Company reported the following capital ratios as of June 30, 2023 and December 31, 2022:

(Bank Only)									Minimum for
	As of June 30, 2023					Well			Capital Adequacy plus
	As of June 30, 2023					Well			Capital Conservation
(dollars in thousands)	Amount		Ratio			Capitalized⁽¹⁾			Buffer⁽¹⁾⁽²⁾

Tier 1 leverage ratio	$	627,958		10.370	%		5.000	%		4.000	%
Common equity tier 1 capital		627,958		18.477			6.500			7.000
Tier 1 risk-based capital		627,958		18.477			8.000			8.500
Total risk-based capital		670,522		19.730			10.000			10.500

	As of December 31, 2022					Well			Minimum for
									Capital Adequacy plus
									Capital Conservation
(dollars in thousands)	Amount		Ratio			Capitalized⁽¹⁾			Buffer ⁽¹⁾⁽²⁾

Tier 1 leverage ratio	$	609,998		10.116	%		5.000	%		4.000	%
Common equity tier 1 capital		609,998		18.431			6.500			7.000
Tier 1 risk-based capital		609,998		18.431			8.000			8.500
Total risk-based capital		651,462		19.684			10.000			10.500

(Consolidated)
	As of June 30, 2023					Minimum for
						Capital Adequacy plus
						Capital Conservation
(dollars in thousands)	Amount		Ratio			Buffer⁽¹⁾⁽²⁾

Tier 1 leverage ratio	$	647,048		10.682	%		4.000	%
Common equity tier 1 capital		647,048		19.034			7.000
Tier 1 risk-based capital		647,048		19.034			8.500
Total risk-based capital		689,629		20.286			10.500

	As of December 31, 2022					Minimum for
						Capital Adequacy plus
						Capital Conservation
(dollars in thousands)	Amount		Ratio			Buffer⁽¹⁾⁽²⁾

Tier 1 leverage ratio	$	626,628		10.390	%		4.000	%
Common equity Tier 1 capital		626,628		18.929			7.000
Tier 1 risk-based capital		626,628		18.929			8.500
Total risk-based capital		668,102		20.182			10.500

(1)	Federal regulatory minimum requirements to be considered to be Well Capitalized and Adequately Capitalized

(2)	The June 30, 2023 and December 31, 2022 common equity tier 1, tier 1 risk-based, and total risk-based capital ratios include a capital conservation buffer of 2.50 percent

- Definition

The entire disclosure for regulatory capital requirement for depository and lending institutions. Institutions include, but not are not limited to, finance company, insured depository institution, bank holding company, savings and loan association holding company, bank and savings institution not federally insured, mortgage company, foreign financial institution and credit union.

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