Stockholders' Equity and Restrictions

9 Months Ended

Sep. 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 September 30,	2021		2020
(In thousands, except per share amounts)

Basic and diluted earnings (loss) per share:
Numerator:
Net income (loss)	$	(2,799)	(7,915)
Net income (loss) allocated to Class A common stock	$	(2,799)	(7,836)
Net income (loss) allocated to Class B common stock	—		(79)
Net income (loss)	$	(2,799)	(7,915)

Denominator:
Weighted average shares of Class A outstanding - basic	49,630		49,437
Weighted average shares of Class A outstanding - diluted	50,263		49,832
Weighted average shares of Class B outstanding - basic and diluted	—		1,002
Basic and diluted earnings (loss) per share of Class A common stock	$	(0.06)	(0.16)
Basic and diluted earnings (loss) per share of Class B common stock	—		(0.07)


Nine Months Ended September 30,	2021		2020
(In thousands, except per share amounts)
Basic and diluted earnings (loss) per share:
Numerator:
Net income (loss)	$	(1,350)	(12,526)
Net income (loss) allocated to Class A common stock	$	(1,345)	(12,401)
Net income (loss) allocated to Class B common stock	(5)		(125)
Net income (loss)	$	(1,350)	(12,526)

Denominator:
Weighted average shares of Class A outstanding - basic	49,594		49,365
Weighted average shares of Class A outstanding - diluted	50,226		49,760
Weighted average shares of Class B outstanding - basic and diluted	401		1,002
Basic and diluted earnings (loss) per share of Class A common stock	$	(0.03)	(0.25)
Basic and diluted earnings (loss) per share of Class B common stock	(0.01)		(0.12)

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 September 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 September 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.