Dividend Restrictions

12 Months Ended

Dec. 31, 2020

Dividends [Abstract]

Dividend Restrictions

Dividend Restrictions

The Bank is subject to the Pennsylvania Banking Code of 1965 (the “Code”), as amended, and is restricted in the amount of dividends that can be paid to its sole shareholder, BMBC. The Code restricts the payment of dividends by the Bank to the amount of its net income during the current calendar year and the retained net income of the prior two calendar years, unless the dividend has been approved by the Federal Reserve Board. Accordingly, the dividend payable by the Bank to BMBC beginning on January 1, 2021 is limited to net income not yet earned in 2021 plus the Bank’s total retained net income for the combined two years ended December 31, 2019 and 2020 of $15.8 million. The Bank issued $35.0 million and $32.0 million of dividends to BMBC during the years ended December 31, 2020 and December 31, 2019, respectively. The amount of dividends paid by the Bank may not exceed a level that reduces capital levels to below levels that would cause the Bank to be considered less than adequately capitalized as detailed in Note 28 – “Regulatory Capital Requirements.”