Note 20 - Stockholder' Equity

12 Months Ended

Dec. 31, 2016

Notes to Financial Statements

Stockholders' Equity Note Disclosure [Text Block]

NOTE

20:

          STOCKHOLDERS’ EQUITY

The Company’s subsidiary bank is subject to a legal limitation on dividends that can be paid to the parent company without prior approval of the applicable regulatory agencies. Under applicable banking laws, the declaration of dividends by Simmons Bank in any year in an amount equal to or greater than

75%

of its net profits after all taxes for that year plus

75%

of the retained net profits for the immediately preceding year must be approved by the Arkansas State Bank Department.   At

December

 

31,

2016,

the Company subsidiary bank had approximately

$3.6

million in undivided profits available for payment of dividends to the Company without prior approval of the regulatory agencies.

The Company’s subsidiary bank is 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 Company’s 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 classifications are also subject to qualitative judgments by the regulators about components, risk weightings and other factors.  Furthermore, the Company’s regulators could require adjustments to regulatory capital not reflected in these financial statements.

Effective

January

1,

2015,

the Company and the Bank became subject to new capital regulations (the “Basel III Capital Rules”) adopted by the Federal Reserve in

July

2013

establishing a new comprehensive capital framework for U.S. Banks. The Basel III Capital Rules substantially revise the risk-based capital requirements applicable to bank holding companies and depository institutions compared to the previous U.S. risk-based capital rules. Full compliance with all of the final rule’s requirements will be phased in over a multi-year schedule. The final rules include a new common equity Tier

1

capital to risk-weighted assets

(CET1)

ratio of

4.5%

and a common equity Tier 

1

capital conservation buffer of

2.5%

of risk-weighted assets.

CET1

generally consists of common stock; retained earnings; accumulated other comprehensive income and certain minority interests; all subject to applicable regulatory adjustments and deductions. The new capital conservation buffer requirement is to be phased in beginning on

January

1,

2016

when a buffer greater than

0.625%

of risk-weighted assets will be required, which amount will increase each year until the buffer requirement is fully implemented on

January

1,

2019.

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

1

capital (as defined in the regulations) to risk-weighted assets (as defined) and of Tier

1

capital (as defined) to average assets (as defined).  Management believes that, as of

December

31,

2016,

the Company meets all capital adequacy requirements to which it is subject.

As of the most recent notification from regulatory agencies, the bank subsidiary was well capitalized under the regulatory framework for prompt corrective action.  To be categorized as well capitalized, the Company and its subsidiary bank must maintain minimum total risk-based, Tier

1

risk-based, common equity Tier

1

risk-based and Tier

1

leverage ratios as set forth in the table.  There are no conditions or events since that notification that management believes have changed the institutions’ categories.

121

The Company’s and the subsidiary Bank’s actual capital amounts and ratios are presented in the following table. 

	Actual				Minimum For Capital Adequacy Purposes				To Be Well Capitalized Under Prompt Corrective Action Provision
(In thousands)	Amount		Ratio (%)		Amount		Ratio (%)		Amount		Ratio (%)
As of December 31, 2016
Total Risk-Based Capital Ratio
Simmons First National Corporation	$	912,948		15.1	$	483,681		8.0	$	N/A
Simmons Bank		830,921		13.8		481,693		8.0		602,117		10.0
Tier 1 Risk-Based Capital Ratio
Simmons First National Corporation		872,707		14.5		361,120		6.0		N/A
Simmons Bank		790,673		13.2		359,397		6.0		479,196		8.0
Common Equity Tier 1 Capital Ratio
Simmons First National Corporation		812,310		13.5		270,770		4.5		N/A
Simmons Bank		790,673		13.2		269,548		4.5		389,347		6.5
Tier 1 Leverage Ratio
Simmons First National Corporation		872,707		11.0		317,348		4.0		N/A
Simmons Bank		790,673		10.0		316,269		4.0		395,337		5.0
As of December 31, 2015
Total Risk-Based Capital Ratio
Simmons First National Corporation	$	843,227		16.7	$	403,941		8.0	$	N/A
Simmons Bank		734,170		14.6		402,285		8.0		502,856		10.0
Tier 1 Risk-Based Capital Ratio
Simmons First National Corporation		808,159		16.0		303,060		6.0		N/A
Simmons Bank		699,102		13.9		301,771		6.0		402,361		8.0
Common Equity Tier 1 Capital Ratio
Simmons First National Corporation		716,737		14.2		227,135		4.5		N/A
Simmons Bank		699,102		13.9		226,328		4.5		326,918		6.5
Tier 1 Leverage Ratio
Simmons First National Corporation		808,159		11.2		288,628		4.0		N/A
Simmons Bank		699,102		9.7		288,289		4.0		360,362		5.0