XML 41 R25.htm IDEA: XBRL DOCUMENT v3.6.0.2
Regulatory Capital Requirements
 12 Months Ended
Dec. 31, 2016
Regulatory Capital Requirements [Abstract]  
Regulatory Capital Requirements
16.        Regulatory Capital Requirements
          
The Company 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 consolidated financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Bank must meet specific capital guidelines that involve quantitative measures of NBT Bank’s assets, liabilities, and certain off-balance sheet items as calculated under regulatory accounting practices. The capital amounts and classifications 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 and the Bank to maintain minimum amounts and ratios (set forth in the table below) of total and Tier 1 Capital to risk-weighted assets and of Tier 1 capital to average assets. As of December 31, 2016 and 2015, the Company and the Bank meet all capital adequacy requirements to which they were subject.
 
Under their prompt corrective action regulations, regulatory authorities are required to take certain supervisory actions (and may take additional discretionary actions) with respect to an undercapitalized institution. Such actions could have a direct material effect on an institution’s financial statements.  The regulations establish a framework for the classification of banks into five categories:  well-capitalized, adequately capitalized, under capitalized, significantly under capitalized, and critically under capitalized. As of December 31, 2016, the most recent notification from the Bank’s regulators categorized the Bank as well-capitalized under the regulatory framework for prompt corrective action.  To be categorized as well-capitalized the Bank must maintain minimum total risk-based, Tier 1 risk-based, and Tier 1 Capital to Average Asset ratios as set forth in the table below. There are no conditions or events since that notification that management believes have changed the Bank’s category.
 
Beginning in 2016, in addition to maintaining minimum capital ratios, the Company is subject to a capital conservation buffer ("Buffer") above the minimum to avoid restriction on capital distributions and discretionary bonus paychecks to officers. At December 31, 2016 the Buffer was 0.625%. The Buffer regulatory minimum ratio will be phased in over four years starting in 2016 with minimum requirement of 0.625% until fully phased in for fiscal year 2019 at 2.5%.
 
The Company and NBT Bank’s actual capital amounts and ratios are presented as follows as of December 31, 2016 and 2015:

 
 
Actual
  
Regulatory ratio requirements
 
(Dollars in thousands)
 
Amount
  
Ratio
  
Minimum
capital adequacy
  
For classification
as well- capitalized
 
As of December 31, 2016
            
Total Capital (to risk weighted assets)
            
Company
 
$
839,152
   
12.39
%
  
8.00
%
  
10.00
%
NBT Bank
  
790,034
   
11.75
%
  
8.00
%
  
10.00
%
Tier I Capital (to risk weighted assets)
                
Company
  
773,111
   
11.42
%
  
4.00
%
  
6.00
%
NBT Bank
  
723,992
   
10.76
%
  
4.00
%
  
6.00
%
Tier I Capital (to average assets)
                
Company
  
773,111
   
9.11
%
  
4.00
%
  
5.00
%
NBT Bank
  
723,992
   
8.59
%
  
4.00
%
  
5.00
%
Common Equity Tier 1 Capital
                
Company
  
676,111
   
9.98
%
  
4.50
%
  
6.50
%
NBT Bank
  
723,992
   
10.76
%
  
4.50
%
  
6.50
%
 
                
As of December 31, 2015
                
Total Capital (to risk weighted assets)
                
Company
 
$
809,685
   
12.74
%
  
8.00
%
  
10.00
%
NBT Bank
  
724,238
   
11.47
%
  
8.00
%
  
10.00
%
Tier I Capital (to risk weighted assets)
                
Company
  
745,341
   
11.73
%
  
4.00
%
  
6.00
%
NBT Bank
  
659,894
   
10.45
%
  
4.00
%
  
6.00
%
Tier I Capital (to average assets)
                
Company
  
745,341
   
9.44
%
  
4.00
%
  
5.00
%
NBT Bank
  
659,894
   
8.41
%
  
4.00
%
  
5.00
%
Common Equity Tier 1 Capital
                
Company
  
648,341
   
10.20
%
  
4.50
%
  
6.50
%
NBT Bank
  
659,894
   
10.45
%
  
4.50
%
  
6.50
%