Regulatory Capital

3 Months Ended

Mar. 31, 2018

Banking and Thrift [Abstract]

Regulatory Capital

Note 13 – Regulatory Capital

Horizon and the Bank are subject to various regulatory capital requirements administered by the federal banking agencies and are assigned to a capital category. Failure to meet the minimum regulatory capital requirements can initiate certain mandatory and possible additional discretionary actions by regulators, which 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 actions, the Bank must meet specific capital guidelines involving 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 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 of total and Tier I capital (as defined in the regulations) to risk-weighted assets (as defined), and of Tier I capital (as defined) to average assets (as defined), or leverage ratio. For March 31, 2018, Basel III rules require the Bank to maintain minimum amounts and ratios of common equity Tier I capital (as defined in the regulation) to risk-weighted assets (as defined). Additionally, under Basel III rules, the decision was made to opt-out of including accumulated other comprehensive income in regulatory capital.

To be categorized as well capitalized, the Bank must maintain minimum Total risk-based, Tier I risk-based, common equity Tier I risk-based and Tier I leverage ratios as set forth in the table below. As of March 31, 2018 and December 31, 2017, the Bank met all capital adequacy requirements to be considered well capitalized. There have been no conditions or events since the end of the first quarter of 2018 that management believes have changed the Bank’s classification as well capitalized. There is no threshold for well-capitalized status for bank holding companies.

Horizon and the Bank’s actual and required capital ratios as of March 31, 2018 and December 31, 2017 were as follows:

	Actual					Required for Capital1 Adequacy Purposes					Required For Capital1 Adequacy Purposes with Capital Buffer					Well Capitalized Under Prompt1 Corrective Action Provisions
	Amount		Ratio			Amount		Ratio			Amount		Ratio			Amount		Ratio
March 31, 2018
Total capital1 (to risk-weighted assets)
Consolidated	$	390,855		13.08	%		239,082		8.00	%		276,439		9.25	%		N/A		N/A
Bank		384,766		12.87	%		239,093		8.00	%		276,451		9.25	%	$	298,866		10.00	%
Tier 1 capital1 (to risk-weighted assets)
Consolidated		374,322		12.53	%		179,312		6.00	%		216,668		7.25	%		N/A		N/A
Bank		368,233		12.32	%		179,320		6.00	%		216,678		7.25	%		239,093		8.00	%
Common equity tier 1 capital1 (to risk-weighted assets)
Consolidated		335,859		11.24	%		134,483		4.50	%		171,840		5.75	%		N/A		N/A
Bank		368,233		12.32	%		134,490		4.50	%		171,848		5.75	%		194,263		6.50	%
Tier 1 capital1 (to average assets)
Consolidated		374,322		9.82	%		152,494		4.00	%		152,494		4.00	%		N/A		N/A
Bank		368,233		9.66	%		152,542		4.00	%		152,542		4.00	%		190,678		5.00	%
December 31, 2017
Total capital1 (to risk-weighted assets)
Consolidated	$	384,800		12.91	%	$	238,543		8.00	%	$	275,816		9.25	%		N/A		N/A
Bank		382,788		12.85	%		238,386		8.00	%		275,634		9.25	%	$	297,982		10.00	%
Tier 1 capital1 (to risk-weighted assets)
Consolidated		368,355		12.35	%		178,907		6.00	%		216,180		7.25	%		N/A		N/A
Bank		366,343		12.29	%		178,790		6.00	%		216,038		7.25	%		238,386		8.00	%
Common equity tier 1 capital1 (to risk-weighted assets)
Consolidated		329,892		11.06	%		134,181		4.50	%		171,454		5.75	%		N/A		N/A
Bank		366,343		12.29	%		134,092		4.50	%		171,340		5.75	%		193,689		6.50	%
Tier 1 capital1 (to average assets)
Consolidated		368,355		9.92	%		148,503		4.00	%		148,503		4.00	%		N/A		N/A
Bank		366,343		9.89	%		148,116		4.00	%		148,116		4.00	%		185,145		5.00	%