Note 20 - Dividend Restrictions and Regulatory Capital

12 Months Ended

Dec. 31, 2022

Notes to Financial Statements

Restrictions on Dividends, Loans and Advances [Text Block]

Note 20 – Dividend Restrictions and Regulatory Capital

The approval of the Office of the Comptroller of the Currency is required if the total of all dividends declared by a national bank in any calendar year exceeds the bank's retained net income, as defined, for that year combined with its retained net income for the preceding two calendar years. Under this formula, the Bank can distribute as dividends to the Company, without the approval of the Office of the Comptroller of the Currency, up to $58.2 million as of December 31, 2022. Dividends paid by the Bank to the Company are the only significant source of funding for dividends paid by the Company to its shareholders.

Federal bank regulators have issued substantially similar guidelines requiring banks and bank holding companies to maintain capital at certain levels. In addition, regulators may from time to time require that a banking organization maintain capital above the minimum levels because of its financial condition or actual or anticipated growth. Failure to meet minimum capital requirements can trigger certain mandatory and discretionary actions by regulators that could have a direct material effect on the Company's financial condition and results of operations.

Management believes that as of December 31, 2022, the Company and Bank met all capital adequacy requirements to which they are subject. At year-end 2022 and 2021, 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.

Actual and required capital amounts (in thousands) and ratios are presented below at year-end. 

										To Be Well
										Capitalized Under
										Prompt Corrective
	Actual					Required for Capital Adequacy Purposes*				Action Provisions
	Amount		Ratio			Amount		Ratio		Amount		Ratio
December 31, 2022
Common Equity Tier 1
Company	$	287,735		11.70	%	$	172,098		>7.00%		N/A		N/A
Bank		308,690		12.57			171,962		>7.00	$	159,679		>6.50%
Tier 1 Capital
Company		316,069		12.86			208,977		>8.50		N/A		N/A
Bank		308,690		12.57			208,811		>8.50		196,528		>8.00
Total Capital
Company		336,001		13.67			258,147		>10.50		N/A		N/A
Bank		328,622		13.38			257,942		>10.50		245,660		>10.00
Leverage Capital
Company		316,069		10.36			122,086		>4.00		N/A		N/A
Bank		308,690		10.12			121,990		>4.00		152,488		>5.00
December 31, 2021
Common Equity Tier 1
Company	$	270,192		12.43	%	$	97,798		>7.00%		N/A		N/A
Bank		285,260		13.15			151,845		>7.00	$	140,999		>6.50%
Tier 1 Capital
Company		298,424		13.73			130,397		>8.50		N/A		N/A
Bank		285,260		13.15			184,383		>8.50		173,537		>8.00
Total Capital
Company		317,488		14.61			173,862		>10.50		N/A		N/A
Bank		304,324		14.03			277,767		>10.50		216,921		>10.00
Leverage Capital
Company		298,424		9.13			130,722		>4.00		N/A		N/A
Bank		285,260		8.76			130,264		>4.00		162,830		>5.00

*Ratios include the conservation buffer.