Regulatory Matters

3 Months Ended

Mar. 31, 2018

Banking and Thrift [Abstract]

Regulatory Matters

Note 29 - Regulatory Matters

The Company is subject to various regulatory capital requirements administered by 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. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company must meet specific capital guidelines that involve quantitative measures of the Company’s assets, liabilities and certain off-balance-sheet items as calculated under regulatory accounting practices. The Company’s capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings and other factors.

Quantitative measures established by regulation to ensure capital adequacy require the Company to maintain minimum amounts and ratios (set forth in the table below) of total, Tier 1, and common equity Tier 1capital to risk-weighted assets, and of Tier 1 capital to average assets.

The following tables present actual and required capital ratios as of March 31, 2018 and December 31, 2017 for the Company and the Bank under Basel III Capital Rules. The minimum capital amounts presented include the minimum required capital levels as of March 31, 2018 (1.875%) and December 31, 2017 (1.25%) based on the then phased-in provisions of the Basel III Capital Rules and the minimum required capital levels as of January 1, 2019 when the Basel III Capital Rules have been fully phased-in. Capital levels required to be considered well capitalized are based upon prompt corrective action regulations, as amended to reflect the changes under the Basel III Capital Rules.

						Minimum Capital					Minimum Capital					Required to be
						Required – Basel III					Required – Basel III					Considered Well
	Actual					Phase-in Schedule					Fully Phased In					Capitalized
	Amount		Ratio			Amount		Ratio			Amount		Ratio			Amount		Ratio
	(dollars in thousands)
As of March 31, 2018:
Total Capital
(to Risk Weighted Assets):
Consolidated		$539,966		13.91	%	$	383,434		9.875	%	$	407,702		10.50	%		N/A		N/A
Tri Counties Bank		$536,894		13.83	%	$	383,261		9.875	%	$	407,518		10.50	%	$	388,112		10.00	%
Tier 1 Capital
(to Risk Weighted Assets):
Consolidated		$506,129		13.03	%	$	305,777		7.875	%	$	330,045		8.50	%		N/A		N/A
Tri Counties Bank		$503,057		12.96	%	$	305,638		7.875	%	$	329,895		8.50	%	$	310,490		8.00	%
Common equity Tier 1 Capital
(to Risk Weighted Assets):
Consolidated		$450,933		11.61	%	$	247,534		6.375	%	$	271,802		7.00	%		N/A		N/A
Tri Counties Bank		$503,057		12.96	%	$	247,421		6.375	%	$	271,678		7.00	%	$	252,273		6.50	%
Tier 1 Capital (to Average Assets):
Consolidated		$506,129		10.84	%	$	186,720		4.000	%	$	186,720		4.00	%		N/A		N/A
Tri Counties Bank		$503,057		10.78	%	$	186,716		4.000	%	$	186,716		4.00	%	$	233,395		5.00	%

	Actual					Minimum Capital Required – Basel III Phase-in Schedule					Minimum Capital Required – Basel III Fully Phased In					Required to be Considered Well Capitalized
	Amount		Ratio			Amount		Ratio			Amount		Ratio			Amount		Ratio
	(dollars in thousands)
As of December 31, 2017:
Total Capital
(to Risk Weighted Assets):
Consolidated	$	528,805		14.07	%	$	347,694		9.25	%	$	394,679		10.50	%		N/A		N/A
Tri Counties Bank	$	525,384		13.98	%	$	347,535		9.25	%	$	394,499		10.50	%	$	375,713		10.00	%
Tier 1 Capital
(to Risk Weighted Assets):
Consolidated	$	495,318		13.18	%	$	272,517		7.25	%	$	319,502		8.50	%		N/A		N/A
Tri Counties Bank	$	491,897		13.09	%	$	272,392		7.25	%	$	319,356		8.50	%	$	300,570		8.00	%
Common equity Tier 1 Capital
(to Risk Weighted Assets):
Consolidated	$	440,643		11.72	%	$	216,134		5.75	%	$	263,120		7.00	%		N/A		N/A
Tri Counties Bank	$	491,897		13.09	%	$	216,035		5.75	%	$	262,999		7.00	%	$	244,214		6.50	%
Tier 1 Capital (to Average Assets):
Consolidated	$	495,318		10.80	%	$	183,400		4.00	%	$	183,400		4.00	%		N/A		N/A
Tri Counties Bank	$	491,897		10.73	%	$	183,394		4.00	%	$	183,394		4.00	%	$	229,243		5.00	%

As of March 31, 2018, capital levels at the Company and the Bank exceed all capital adequacy requirements under the Basel III Capital Rules on a fully phased-in basis. Also, at March 31, 2018 and December 31, 2017, the Bank’s capital levels exceeded the minimum amounts necessary to be considered well capitalized under the current regulatory framework for prompt corrective action.

Beginning January 1, 2016, the Basel III Capital Rules implemented a requirement for all banking organizations to maintain a capital conservation buffer above the minimum risk-based capital requirements in order to avoid certain limitations on capital distributions, stock repurchases and discretionary bonus payments to executive officers. The capital conservation buffer is exclusively composed of common equity tier 1 capital, and it applies to each of the risk-based capital ratios but not the leverage ratio. At March 31, 2018, the Company and the Bank are in compliance with the capital conservation buffer requirement. The three risk-based capital ratios will increase by 0.625% each year through 2019, at which point, the common equity tier 1 risk-based, tier 1 risk-based and total risk-based capital ratio minimums will be 7.0%, 8.5% and 10.5%, respectively.