Regulatory Matters

12 Months Ended

Dec. 31, 2023

Regulatory Matters

Regulatory Matters

NOTE 26 Regulatory Matters

The Bank is subject to various regulatory capital requirements administered by the federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Company’s and the Bank’s consolidated financial statements.

Quantitative measures established by regulation to ensure capital adequacy require the Company and the Bank to maintain minimum amounts and ratios (set forth in the following table) of common equity tier 1, tier 1, and total capital (as defined in the regulations) to risk weighted assets (as defined) and of tier 1 capital (as defined) to average assets (as defined). Management believes at December 31, 2023 and 2022, each of the Company and the Bank met all of the capital adequacy requirements to which it is subject.

As of December 31, 2023, the most recent notification from the Federal Deposit Insurance Corporation, categorized the Bank as well capitalized under the regulatory framework for prompt corrective action. There are no conditions or events since the notification that management believe have changed in the Bank’s category.

Actual capital amounts and ratios for the Company (consolidated) and the Bank at December 31, 2023 and 2022 are presented in the following table:

	December 31, 2023
									Minimum to be
					Minimum Required				Well Capitalized
					for Capital				Under Prompt
	Actual				Adequacy Purposes				Corrective Action (1)
(dollars in thousands)	Amount		Ratio		Amount		Ratio		Amount		Ratio
Common equity tier 1 capital to risk weighted assets
Consolidated (1)	$	382,578	11.82	%	$	145,605	4.50	%	$	N/A	N/A
Bank		367,445	11.40	%		145,101	4.50	%		209,590	6.50	%
Tier 1 capital to risk weighted assets										.
Consolidated (1)		391,534	12.10	%		194,139	6.00	%		N/A	N/A
Bank		367,445	11.40	%		193,468	6.00	%		257,957	8.00	%
Total capital to risk weighted assets
Consolidated (1)		477,590	14.76	%		258,853	8.00	%		N/A	N/A
Bank		403,501	12.51	%		257,957	8.00	%		322,446	10.00	%
Tier 1 capital to average assets
Consolidated (1)		391,534	10.57	%		148,111	4.00	%		N/A	N/A
Bank		367,445	9.92	%		148,186	4.00	%		185,232	5.00	%

(1) “Minimum to be Well Capitalized Under Prompt Corrective Action” is not formally defined under applicable banking regulations for bank holding companies.

	December 31, 2022
									Minimum to be
					Minimum Required				Well Capitalized
					for Capital				Under Prompt
	Actual				Adequacy Purposes				Corrective Action (1)
(dollars in thousands)	Amount		Ratio		Amount		Ratio		Amount		Ratio
Common equity tier 1 capital to risk weighted assets
Consolidated (1)	$	389,335	13.39	%	$	130,862	4.50	%	$	N/A	N/A
Bank		370,749	12.76	%		130,791	4.50	%		188,920	6.50	%
Tier 1 capital to risk weighted assets										.
Consolidated (1)		398,179	13.69	%		174,482	6.00	%		N/A	N/A
Bank		370,749	12.76	%		174,388	6.00	%		232,517	8.00	%
Total capital to risk weighted assets
Consolidated (1)		479,325	16.48	%		232,643	8.00	%		N/A	N/A
Bank		401,895	13.83	%		232,517	8.00	%		290,646	10.00	%
Tier 1 capital to average assets
Consolidated (1)		398,179	11.25	%		141,514	4.00	%		N/A	N/A
Bank		370,749	10.48	%		141,440	4.00	%		176,800	5.00	%

(1) “Minimum to be Well Capitalized Under Prompt Corrective Action” is not formally defined under applicable banking regulations for bank holding companies.

The Bank is subject to certain restrictions on the amount of dividends that it may pay without prior regulatory approval. The Bank normally restricts dividends to a lesser amount. In addition, the Company must adhere to various U.S. Department of Housing and Urban Development, or HUD, regulatory guidelines including required minimum capital and liquidity to maintain their Federal Housing Administration approval status. Failure to comply with the HUD guidelines could result in withdrawal of this certification. As of December 31, 2023 and 2022, the Company was in compliance with HUD guidelines.