REGULATORY REQUIREMENTS

12 Months Ended

Dec. 31, 2020

Regulatory Capital Requirements [Abstract]

REGULATORY REQUIREMENTS

10. REGULATORY REQUIREMENTS

Payment of dividends by the Bank to the parent company is subject to various regulatory restrictions.  For national banks, the governing regulatory agency must approve the declaration of any dividends generally in excess of the sum of net income for that year and retained net income for the preceding two years.  

The Bank maintains a reserve balance with the FRB as required by law.  During 2020, this amount averaged $1.2 billion, compared to $560.9 million in 2019.

At December 31, 2020, the Company is required to have minimum common equity tier 1, tier 1, and total capital ratios of 4.5%, 6.0% and 8.0%, respectively.  The Company’s actual ratios at that date were 12.10%, 12.10% and 14.26%, respectively.  The Company is required to have a minimum leverage ratio of 4.0%, and the leverage ratio at December 31, 2020, was 8.37%.

As of December 31, 2020, the most recent notification from the OCC categorized the Bank as well capitalized under the regulatory framework for prompt corrective action.  To be categorized as well-capitalized the Bank must maintain total risk-based, tier 1 risk-based, common equity tier 1, and tier 1 leverage ratios of 10.0%, 8.0%, 6.5%, and 5.0%, respectively.  There are no conditions or events that have occurred since the receipt of the most recent notification that management believes have changed the Bank’s categorization.

In addition, under amendments to the BHCA introduced by the Dodd-Frank Act and commonly known as the Volcker Rule, the Company and its subsidiaries are subject to extensive limits on proprietary trading and on owning or sponsoring hedge funds and private-equity funds. The limits on proprietary trading are largely focused on purchases or sales of financial instruments by a banking entity as principal primarily for the purpose of short-term resale, benefitting from actual or expected short-term price movements, or realizing short-term arbitrage profits. The limits on owning or sponsoring hedge funds and private-equity funds are designed to ensure that banking entities

generally maintain only small positions in managed or advised funds and are not exposed to significant losses arising directly or indirectly from them. The Volcker Rule also provides for increased capital charges, quantitative limits, rigorous compliance programs, and other restrictions on permitted proprietary trading and fund activities, including a prohibition on transactions with a covered fund that would constitute a covered transaction under Sections 23A and 23B of the Federal Reserve Act. The fund activities of the Company and its subsidiaries are in conformance with the Volcker Rule.  

Actual capital amounts as well as required and well-capitalized common equity tier 1, tier 1, total and tier 1 leverage ratios as of December 31, 2020 and 2019 for the Company and the Bank are as follows (in thousands):

	2020
	Actual					For Capital Adequacy Purposes					To Be Well Capitalized Under Prompt Corrective Action Provisions
	Amount		Ratio			Amount		Ratio			Amount		Ratio
Common Equity Tier 1 Capital:
UMB Financial Corporation	$	2,547,634		12.10	%	$	947,486		4.50	%	$	N/A		N/A	%
UMB Bank, n. a.		2,492,571		11.92			941,036		4.50			1,359,275		6.50
Tier 1 Capital:
UMB Financial Corporation		2,547,634		12.10			1,263,315		6.00		N/A		N/A
UMB Bank, n. a.		2,492,571		11.92			1,254,715		6.00			1,672,954		8.00
Total Capital:
UMB Financial Corporation		3,002,545		14.26			1,684,420		8.00		N/A		N/A
UMB Bank, n. a.		2,679,844		12.81			1,672,954		8.00			2,091,192		10.00
Tier 1 Leverage:
UMB Financial Corporation		2,547,634		8.37			1,217,386		4.00		N/A		N/A
UMB Bank, n. a.		2,492,571		8.28			1,203,559		4.00			1,504,449		5.00
	2019
Common Equity Tier 1 Capital:
UMB Financial Corporation	$	2,330,533		12.33	%	$	850,304		4.50	%	$	N/A		N/A	%
UMB Bank, n. a.		2,128,608		11.36			843,544		4.50			1,218,453		6.50
Tier 1 Capital:
UMB Financial Corporation		2,330,533		12.33			1,133,738		6.00		N/A		N/A
UMB Bank, n. a.		2,128,608		11.36			1,124,726		6.00			1,499,635		8.00
Total Capital:
UMB Financial Corporation		2,505,397		13.26			1,511,651		8.00		N/A		N/A
UMB Bank, n. a.		2,233,100		11.91			1,499,635		8.00			1,874,543		10.00
Tier 1 Leverage:
UMB Financial Corporation		2,330,533		9.37			995,000		4.00		N/A		N/A
UMB Bank, n. a.		2,128,608		8.62			987,983		4.00			1,234,978		5.00