v3.26.1
Note 19 - Regulatory Matters
 6 Months Ended
Jun. 30, 2026
Notes to Financial Statements  
Regulatory Capital Requirements under Banking Regulations [Text Block]

NOTE 19 Regulatory Matters

 

The Company and the Bank are 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 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 that, at June 30, 2026 and December 31, 2025, each of the Company and the Bank had met all of the capital adequacy requirements to which it was subject.

 

The following tables present the Company’s and the Bank’s actual capital amounts and ratios as of June 30, 2026 and December 31, 2025:

 

 

  

June 30, 2026

 
                  

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)

 $476,882   10.81% $198,440   4.50%  N/A   N/A 

Bank

  474,133   10.92%  195,472   4.50%  282,348   6.50%

Tier 1 capital to risk weighted assets

                        

Consolidated (1)

  486,121   11.02%  264,587   6.00%  N/A   N/A 

Bank

  474,133   10.92%  260,629   6.00%  347,505   8.00%

Total capital to risk weighted assets

                        

Consolidated (1)

  588,055   13.34%  352,782   8.00%  N/A   N/A 

Bank

  526,067   12.11%  347,505   8.00%  434,381   10.00%

Tier 1 capital to average assets

                        

Consolidated (1)

  486,121   9.49%  204,859   4.00%  N/A   N/A 

Bank

  474,133   9.26%  204,721   4.00%  255,901   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, 2025

 
                  

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)

 $452,125   10.28% $198,002   4.50%  N/A   N/A 

Bank

  448,675   10.41%  194,009   4.50%  280,235   6.50%

Tier 1 capital to risk weighted assets

                        

Consolidated (1)

  461,307   10.48%  264,002   6.00%  N/A   N/A 

Bank

  448,675   10.41%  258,679   6.00%  344,905   8.00%

Total capital to risk weighted assets

                        

Consolidated (1)

  566,443   12.87%  352,003   8.00%  N/A   N/A 

Bank

  502,714   11.66%  344,905   8.00%  431,131   10.00%

Tier 1 capital to average assets

                        

Consolidated (1)

  461,307   8.86%  208,235   4.00%  N/A   N/A 

Bank

  448,675   8.62%  208,160   4.00%  260,200   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, including rules requiring a 2.5 percent capital conservation buffer that is added to the minimum requirements for capital adequacy purposes. A banking organization with a conservation buffer of less than the required amount will be subject to the limitations on capital distributions, including dividend payments and certain discretionary bonus payments to executive officers. As of June 30, 2026, the capital ratios for the Company and the Bank were sufficient to meet the conservation buffer. In addition, the Company must adhere to various U.S. Department of Housing and Urban Development (“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 June 30, 2026 and December 31, 2025, the Company was in compliance with the aforementioned guidelines.