Regulatory Matters

12 Months Ended

Dec. 31, 2022

Regulatory Assets and Liabilities Disclosure [Abstract]

Regulatory Matters

Regulatory MattersThe Bank Holding Company Act of 1956 restricts the amount of dividends the Company can pay. Accordingly, dividends should generally only be paid out of current earnings, as defined. The New Jersey Banking Act of 1948 restricts the amount of dividends paid on the capital stock of New Jersey chartered banks. Accordingly, no dividends shall be paid by such banks on their capital stock unless, following the payment of such dividends, the capital stock of Lakeland will be unimpaired, and: (1) Lakeland will have a surplus, as defined, of not less than 50% of its capital stock, or, if not, (2) the payment of such dividend will not reduce the surplus, as defined, of Lakeland. Under these limitations, approximately $925.7 million was available for payment of dividends from Lakeland to the Company as of December 31, 2022.

The Company and Lakeland are subject to various regulatory capital requirements administered by the federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory – and possible additional discretionary – actions by regulators that, if undertaken, could have a direct material effect on the Company’s and Lakeland’s consolidated financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company must meet specific capital guidelines that involve quantitative measures of the Company’s and Lakeland’s assets, liabilities and certain off-balance-sheet items as calculated under regulatory accounting practices. The Company’s and Lakeland’s capital amounts and classifications are also subject to qualitative judgments by the regulators about components, risk weightings and other factors.

Quantitative measures established by regulations to ensure capital adequacy require the Company and Lakeland to maintain minimum amounts and ratios (set forth in the table below) of total and Tier 1 capital (as defined in the regulations) to risk-weighted assets, and of Tier 1 capital to average assets. Management believes, as of December 31, 2022, that the Company and Lakeland met all capital adequacy requirements to which they are subject.

As of December 31, 2022, the most recent notification from the FDIC categorized Lakeland as well capitalized under the regulatory framework for prompt corrective action. To be categorized as well capitalized, Lakeland must maintain minimum total risk-based, Tier 1 risk-based, common equity Tier 1 capital and Tier 1 leverage ratios as set forth in the table below. There are no conditions or events since that notification that management believes have changed the institution’s category.

As of December 31, 2022 and 2021, the Company and Lakeland have the following capital ratios based on the then current regulations.

(dollars in thousands)	Actual				For Capital Adequacy Purposes with Capital Conservation Buffer						To Be Well Capitalized Under Prompt Corrective Action Provisions
December 31, 2022	Amount		Ratio		Amount				Ratio		Amount				Ratio
Total capital (to risk-weighted assets)
Company	$	1,167,429	13.83	%	>	$	886,420	>	10.50	%		N/A			N/A
Lakeland	1,109,089		13.15	%		885,667			10.50	%	>	$	843,492	>	10.00	%
Tier 1 capital (to risk-weighted assets)
Company	$	948,970	11.24	%	>	$	717,578	>	8.50	%		N/A			N/A
Lakeland	1,038,661		12.31	%		716,968			8.50	%	>	$	674,794	>	8.00	%
Common equity Tier 1 capital (to risk-weighted assets)
Company	$	904,532	10.71	%	>	$	590,946	>	7.00	%		N/A			N/A
Lakeland	1,038,661		12.31	%		590,444			7.00	%	>	$	548,270	>	6.50	%
Tier 1 capital (to average assets)
Company	$	948,970	9.16	%	>	$	414,485	>	4.00	%		N/A			N/A
Lakeland	1,038,661		10.03	%		414,212			4.00	%	>	$	517,765	>	5.00	%

(dollars in thousands)	Actual				For Capital Adequacy Purposes with Capital Conservation Buffer						To Be Well Capitalized Under Prompt Corrective Action Provisions
December 31, 2021	Amount		Ratio		Amount				Ratio		Amount				Ratio
Total capital (to risk-weighted assets)
Company	$	903,415	14.48	%	>	$	654,978	>	10.50	%		N/A			N/A
Lakeland	852,339		13.67	%		654,692			10.50	%	>	$	623,516	>	10.00	%
Tier 1 capital (to risk-weighted assets)
Company	$	695,634	11.15	%	>	$	530,220	>	8.50	%		N/A			N/A
Lakeland	792,363		12.71	%		529,989			8.50	%	>	$	498,813	>	8.00	%
Common equity Tier 1 capital (to risk-weighted assets)
Company	$	665,634	10.67	%	>	$	436,652	>	7.00	%		N/A			N/A
Lakeland	792,363		12.71	%		436,461			7.00	%	>	$	405,285	>	6.50	%
Tier 1 capital (to average assets)
Company	$	695,634	8.51	%	>	$	326,813	>	4.00	%		N/A			N/A
Lakeland	792,363		9.70	%		326,734			4.00	%	>	$	408,418	>	5.00	%