Company: WBS-PG
Filing Date: 2025-08-11
Form Type: 10-Q
Source: 0000801337-25-000083
Chunk: 194

Company: WEBSTER FINANCIAL CORP
Filing Date: 2025-08-11
Form: 10-Q
Item: Part I, Item 2
Chunk 194
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74 4,373,389 8.0 5,466,736 10.0 Tier 1 Leverage Capital 6,847,474 9.04 3,031,190 4.0 3,788,988 5.0 (1)In accordance with regulatory capital rules, the Company elected to delay the estimated impact of the adoption of CECL on its regulatory capital over a two-year deferral period, which ended on January 1, 2022, and a subsequent three-year transition period, which ended on December 31, 2024. During the three-year transition period, regulatory capital ratios phased out the aggregate amount of the regulatory capital benefit provided from the delayed CECL adoption in the initial two years. For 2024, the Company was allowed 25%  of the regulatory capital benefit as of December 31, 2021. Full absorption occurred in 2025.

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Dividend RestrictionsThe Holding Company is dependent upon dividends from the Bank to provide funds for the payment of dividends to stockholders and for other cash requirements. Dividends paid by the Bank are subject to various federal and state regulatory limitations. Express approval by the OCC is required if the effect of dividends declared would cause the regulatory capital of the Bank to fall below specified minimum levels or if the amount would exceed net income for that year combined with undistributed net income for the preceding two years. The Bank paid the Holding Company dividends of $200.0 million and $300.0 million for the three and six months ended June 30, 2025, respectively, and $125.0 million and $300.0 million for the three and six months ended June 30, 2024, respectively, for which no express approval from the OCC was required. Cash RestrictionsThe Bank is required under Federal Reserve regulations to maintain cash reserve balances in the form of vault cash or deposits held at a FRB to ensure that it is able to meet customer demands. The reserve requirement ratio is subject to adjustment as economic conditions warrant. On March 26, 2020, the Federal Reserve reduced the reserve requirement ratios on all net transaction accounts to zero percent. As a result, the Bank has not been required to hold cash reserve balances since that date.

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Note 11: Variable Interest Entities

The Company has an investment interest in the following entities that each meet the definition of a VIE. Information regarding the consolidation of VIEs can be found within Note