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REGULATORY CAPITAL REQUIREMENTS
 12 Months Ended
Dec. 31, 2022
Regulatory Capital Requirements Under Banking Regulations [Abstract]  
REGULATORY CAPITAL REQUIREMENTS REGULATORY CAPITAL REQUIREMENTS The Company (on a consolidated basis) 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 and Bank’s financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company and Bank must meet specific capital guidelines that involve quantitative measures of their assets, liabilities and certain off-balance sheet items
as calculated under regulatory accounting practices. The capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk-weightings, and other factors. Prompt corrective action provisions are not applicable to bank holding companies.
The Company and Bank must also maintain a “capital conservation buffer” consisting of common equity Tier 1 (“CET1”) in an amount equal to 2.5% of risk-weighted assets in order to avoid certain restrictions. The capital conservation buffer effectively increases the minimum well-capitalized CET1 capital, Tier 1 capital, and total capital ratios for U.S. banking organizations to 7.0%, 8.5%, and 10.5%, respectively. Failure to meet this capital conservation buffer would result in limit on dividends, other distributions, and discretionary bonuses.
Quantitative measures established by regulation to ensure capital adequacy require the Company and Bank to maintain minimum amounts and ratios (set forth in the table below) of Total, Tier 1 and CET1 capital (as defined in the regulations) to risk-weighted assets (as defined), and Tier 1 capital (as defined) to average assets (as defined). Management believes the Company and the Bank met all capital adequacy requirements to which they are subject as of December 31, 2022 and 2021.
As of December 31, 2022 and 2021, the most recent notifications from the regulatory agencies categorized the Bank as well-capitalized under the regulatory framework for prompt corrective action. To be categorized as well-capitalized, an institution must maintain minimum Total risk-based, Tier 1 risk-based, CET1 risk-based and Tier 1 leverage ratios as set forth in the following table. There are no conditions or events since these notifications that management believes have changed the Bank’s category.
The Bank is also subject to legal limitations on dividends that can be paid to the parent company without prior approval of the applicable regulatory agencies. Dividends declared by the Bank that exceed the retained net income for the most current year plus retained net income for the preceding two years must be approved by Federal regulatory agencies. At December 31, 2022, the Bank could pay dividends of approximately $28 million to the Company without seeking regulatory approval.
The Company’s and the Bank’s actual regulatory capital amounts and ratios are presented in the following table.
ActualFor Capital Adequacy
Purposes
To Be Well Capitalized
Under Prompt Corrective
Action Provisions (2)
(in thousands)Amount
Ratio (1)
Amount
Ratio (1)
Amount
Ratio (1)
December 31, 2022      
Company      
Total risk-based capital$889,763 12.3 %$577,138 8.0 %  
Tier 1 risk-based capital684,280 9.5 432,853 6.0   
Common equity Tier 1 capital646,341 9.0 324,640 4.5   
Leverage684,280 8.2 335,621 4.0   
Bank      
Total risk-based capital$816,951 11.3 %$576,241 8.0 %$720,301 10.0 %
Tier 1 risk-based capital764,090 10.6 432,181 6.0 576,241 8.0 
Common equity Tier 1 capital764,090 10.6 324,135 4.5 468,196 6.5 
Leverage764,090 9.1 334,916 4.0 418,645 5.0 
December 31, 2021      
Company      
Total risk-based capital$793,410 13.8 %$459,648 8.0 %  
Tier 1 risk-based capital604,199 10.5 344,736 6.0   
Common equity Tier 1 capital567,095 9.9 258,552 4.5   
Leverage604,199 9.4 256,990 4.0   
Bank      
Total risk-based capital$700,869 12.2 %$459,476 8.0 %$574,345 10.0 %
Tier 1 risk-based capital664,688 11.6 344,607 6.0 459,476 8.0 
Common equity Tier 1 capital664,688 11.6 258,455 4.5 373,324 6.5 
Leverage664,688 10.3 256,990 4.0 321,237 5.0 
(1)The Total risk-based capital ratio is defined as Tier 1 capital plus tier 2 capital divided by total risk-weighted assets. The Tier 1 risk-based capital ratio is defined as Tier 1 capital divided by total risk-weighted assets. CET1 risk-based capital ratio is defined as Tier 1 capital, with deductions for goodwill and other intangible assets (other than mortgage servicing assets), net of associated deferred tax liabilities, and limitations on the inclusion of deferred tax assets,
mortgage servicing assets and investments in other financial institutions, in each case as provided further in the rules, divided by total risk-weighted assets. The Leverage ratio is defined as Tier 1 capital divided by the most recent quarter’s average total assets as adjusted.
(2)Prompt corrective action provisions are not applicable at the bank holding company level.