Stockholders' Equity and Restrictions

6 Months Ended

Jun. 30, 2021

STOCKHOLDERS' EQUITY AND RESTRICTIONS

EARNINGS PER SHARE

The following tables set forth the computation of basic and diluted earnings (loss) per share.



Three Months Ended June 30,	2021		2020
(In thousands, except per share amounts)

Basic and diluted earnings (loss) per share:
Numerator:
Net income (loss)	$	5,022	(1,027)
Net income (loss) allocated to Class A common stock	$	5,010	(1,017)
Net income (loss) allocated to Class B common stock	12		(10)
Net income (loss)	$	5,022	(1,027)

Denominator:
Weighted average shares of Class A outstanding - basic	49,602		49,345
Weighted average shares of Class A outstanding - diluted	50,192		49,528
Weighted average shares of Class B outstanding - basic and diluted	250		1,002
Basic and diluted earnings (loss) per share of Class A common stock	$	0.10	(0.02)
Basic and diluted earnings (loss) per share of Class B common stock	0.05		(0.01)


Six Months Ended June 30,	2021		2020
(In thousands, except per share amounts)
Basic and diluted earnings (loss) per share:
Numerator:
Net income (loss)	$	1,449	(4,611)
Net income (loss) allocated to Class A common stock	$	1,441	(4,565)
Net income (loss) allocated to Class B common stock	8		(46)
Net income (loss)	$	1,449	(4,611)

Denominator:
Weighted average shares of Class A outstanding - basic	49,578		49,322
Weighted average shares of Class A outstanding - diluted	50,145		49,506
Weighted average shares of Class B outstanding - basic and diluted	572		1,002
Basic and diluted earnings (loss) per share of Class A common stock	$	0.03	(0.09)
Basic and diluted earnings (loss) per share of Class B common stock	0.01		(0.05)

CAPITAL AND SURPLUS

Each of our regulated insurance subsidiaries is required to meet stipulated regulatory capital requirements. These include capital requirements imposed by the U.S. National Association of Insurance Commissioners ("NAIC") and the Bermuda Monetary Authority ("BMA"). All insurance subsidiaries exceeded the minimum capital requirements at June 30, 2021.

In order to minimize the risk of a shortfall in capital arising from an unexpected adverse deviation or excess risk, the BMA has established a threshold capital level (termed the Target Capital Level ("TCL")), which is set at 120% of a company’s enhanced capital requirement. The TCL serves as an early warning tool for the BMA. As of June 30, 2021, CICA Ltd. was above the TCL threshold. At the request of the BMA, on April 15, 2021, Citizens and CICA Ltd. entered into a Keep Well Agreement. The Keep Well Agreement requires Citizens to contribute up to $10 million in capital to CICA Ltd. as necessary to ensure that CICA Ltd. has a minimum capital level of 120% (equal to the TCL). Since CICA Ltd.’s capital level currently exceeds 120%, Citizens is not currently required to make a capital contribution.