Regulatory Matters

12 Months Ended

Dec. 31, 2012

Regulatory Matters [Abstract]

Regulatory Matters

NOTE K – REGULATORY MATTERS

Regulatory Capital Requirements

The Corporation’s subsidiary banks are subject to various regulatory capital requirements administered by banking regulators. 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 Corporation’s financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the subsidiary banks must meet specific capital guidelines that involve quantitative measures of the subsidiary banks’ assets, liabilities, and certain off-balance sheet items as calculated under regulatory accounting practices. The subsidiary banks’ 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 subsidiary banks to maintain minimum amounts and ratios of total and Tier I capital to risk-weighted assets, and of Tier I capital to average assets (as defined in the regulations). Management believes, as of December 31, 2012, that all of its bank subsidiaries meet the capital adequacy requirements to which they were subject.

As of December 31, 2012 and 2011, the Corporation’s four significant subsidiaries, Fulton Bank, N.A., Fulton Bank of New Jersey, The Columbia Bank and Lafayette Ambassador Bank, were well capitalized under the regulatory framework for prompt corrective action based on their capital ratio calculations. To be categorized as well capitalized, these banks must maintain minimum total risk-based, Tier I risk-based, and Tier I leverage ratios as set forth in the following table. There are no conditions or events since December 31, 2012 that management believes have changed the institutions’ categories.

The following tables present the total risk-based, Tier I risk-based and Tier I leverage requirements for the Corporation and its significant subsidiaries with total assets in excess of $1 billion.

	2012
	Actual				For Capital Adequacy Purposes				Well Capitalized
	Amount		Ratio		Amount		Ratio		Amount	Ratio
	(dollars in thousands)
Total Capital (to Risk-Weighted Assets):
Corporation	$	1,992,968	15.6	%	$	1,023,759	8.0	%	N/A	N/A
Fulton Bank, N.A.	1,022,411		13.1		622,643		8.0		778,304	10.0	%
Fulton Bank of New Jersey	337,660		14.1		191,842		8.0		239,802	10.0
The Columbia Bank	231,762		17.3		107,363		8.0		134,204	10.0
Lafayette Ambassador Bank	145,391		13.4		87,119		8.0		108,899	10.0
Tier I Capital (to Risk-Weighted Assets):
Corporation	1,710,343		13.4		511,880		4.0	%	N/A	N/A
Fulton Bank, N.A	896,058		11.5		311,322		4.0		466,982	6.0	%
Fulton Bank of New Jersey	299,852		12.5		95,921		4.0		143,881	6.0
The Columbia Bank	214,891		16.0		53,681		4.0		80,522	6.0
Lafayette Ambassador Bank	128,975		11.8		43,559		4.0		65,339	6.0
Tier I Capital (to Average Assets):
Corporation	1,710,343		11.0		624,838		4.0	%	N/A	N/A
Fulton Bank, N.A	896,058		10.1		353,206		4.0		441,507	5.0	%
Fulton Bank of New Jersey	299,852		9.5		126,733		4.0		158,416	5.0
The Columbia Bank	214,891		11.3		76,174		4.0		95,217	5.0
Lafayette Ambassador Bank	128,975		9.5		54,569		4.0		68,211	5.0

	2011
	Actual				For Capital Adequacy Purposes				Well Capitalized
	Amount		Ratio		Amount		Ratio		Amount	Ratio
	(dollars in thousands)
Total Capital (to Risk-Weighted Assets):
Corporation	$	1,933,278	15.2	%	$	1,018,865	8.0	%	N/A	N/A
Fulton Bank, N.A.	994,683		13.2		604,259		8.0		755,324	10.0	%
Fulton Bank of New Jersey	327,356		13.0		201,381		8.0		251,726	10.0
The Columbia Bank	219,432		15.5		113,478		8.0		141,848	10.0
Lafayette Ambassador Bank	143,113		13.0		88,408		8.0		110,510	10.0
Tier I Capital (to Risk-Weighted Assets):
Corporation	$	1,612,859	12.7		$	509,432	4.0	%	N/A	N/A
Fulton Bank, N.A	856,464		11.3		302,130		4.0		453,194	6.0	%
Fulton Bank of New Jersey	284,334		11.3		100,690		4.0		151,036	6.0
The Columbia Bank	201,564		14.2		56,739		4.0		85,109	6.0
Lafayette Ambassador Bank	125,951		11.4		44,204		4.0		66,306	6.0
Tier I Capital (to Average Assets):
Corporation	$	1,612,859	10.3		$	626,546	4.0	%	N/A	N/A
Fulton Bank, N.A	856,464		9.8		348,385		4.0		435,481	5.0	%
Fulton Bank of New Jersey	284,334		8.7		131,221		4.0		164,027	5.0
The Columbia Bank	201,564		10.6		75,918		4.0		94,897	5.0
Lafayette Ambassador Bank	125,951		8.9		56,634		4.0		70,793	5.0

N/A – Not applicable as "well capitalized" applies to banks only.

Dividend and Loan Limitations

The dividends that may be paid by subsidiary banks to the Parent Company are subject to certain legal and regulatory limitations. Dividend limitations vary, depending on the subsidiary bank’s charter and whether or not it is a member of the Federal Reserve System. Generally, subsidiaries are prohibited from paying dividends when doing so would cause them to fall below the regulatory minimum capital levels. Additionally, limits exist on paying dividends in excess of net income for specified periods. The total amount available for payment of dividends by subsidiary banks was approximately$329 millionas of December 31, 2012, based on the subsidiary banks maintaining enough capital to be considered well capitalized, as defined above.

Under current Federal Reserve regulations, the subsidiary banks are limited in the amount they may loan to their affiliates, including the Parent Company. Loans to a single affiliate may not exceed 10%, and the aggregate of loans to all affiliates may not exceed 20% of each bank subsidiary’s regulatory capital.