Common use of CAPITAL PLAN Clause in Contracts

CAPITAL PLAN. (1) Within sixty (60) days of the date of this Agreement, the Board shall adopt an effective internal capital planning process to assess the Bank’s capital adequacy in relation to its overall risks and strategies. Thereafter, management shall implement, and the Board shall verify, no less than annually, adherence to the capital planning process. The capital planning process shall be consistent with safe and sound practices and ensure the integrity, objectivity, and consistency of the process through adequate governance. Refer to the “Capital and Dividends” booklet of the Comptroller’s Handbook. The Board shall document the capital planning process and thereafter review and document the capital planning process at least annually or more frequently, if appropriate, or required by the Assistant Deputy Comptroller in writing. (2) Within sixty (60) days of the date of this Agreement, the Board shall submit to the Assistant Deputy Comptroller for review and prior written determination of no supervisory objection an acceptable revised written capital plan for the Bank, consistent with the Strategic Plan required by Article III, covering at least a three-year time frame (“Capital Plan”). Refer to “Capital and Dividends” booklet of the Comptroller’s Handbook for guidance. The Bank’s Capital Plan shall, at a minimum: (a) include specific plans for the achievement and ongoing maintenance of adequate capital; (b) an updated risk assessment within the Capital Plan to ensure it considers all current and future threats to the Bank’s capital. Specifically, the Capital Plan shall include an updated assessment of the quantity and direction of credit, liquidity, interest rate, and operational risks; (c) the Bank must develop, and the Asset / Liability Committee (ALCO) and Board must approve, a capital policy that includes, at a minimum: (i) reasonable minimum capital requirements based on the risk assessment required by sub-paragraph (b) of this paragraph; (ii) identifies and establishes a strategy to strengthen the Bank’s capital, including plans to seek capital injections into the Bank; (iii) measurable triggers/early warning indicators to prompt board and management action to assess additional capital sources; and (iv) identification and quantification of contingent sources of capital, including primary and alternate sources of capital as well as order of preference of these sources and the time required to access these sources; (d) include detailed quarterly financial projections which shall be consistent with the Strategic Plan required by Article III; and (e) include specific plans detailing how the Bank will comply with restrictions or requirements set forth in this Agreement that will have an impact on the Bank’s capital. (3) The Bank may declare or pay a dividend or make a capital distribution only: (a) when the Bank is in compliance with its Board-approved Capital Plan and would remain in compliance with such Capital Plan immediately following the declaration or payment of any dividend or capital distribution; (b) when the dividend or capital distribution would comply with 12 U.S.C. §§ 56, 60 and 1831o(d)(1) and 12 C.F.R. § 3.11(a)(4); and (c) following the Assistant Deputy Comptroller’s prior written determination of no supervisory objection to the dividend or capital distribution. (4) Within fifteen (15) days following receipt of the Assistant Deputy Comptroller’s written determination of no supervisory objection to the Bank’s Capital Plan or to any subsequent amendment to the Capital Plan, the Board shall adopt and Bank management, subject to Board review and ongoing monitoring, shall immediately implement and thereafter ensure adherence to the Capital Plan. The Board shall review the effectiveness of the Capital Plan at least annually, no later than January 31 each year, and more frequently if necessary or if required by the OCC in writing, and amend the Capital Plan as needed or directed by the OCC. Any amendment to the Capital Plan must be submitted to the Assistant Deputy Comptroller for review and prior written determination of no supervisory objection. (5) At least monthly, the Board shall review financial reports and earnings analyses that evaluate the Bank’s performance against the goals and objectives established in the Capital Plan, as well as the Bank’s written explanation of significant differences between the actual and projected balance sheet, income statement, and expense accounts, including a description of any extraordinary and/or nonrecurring items. This review shall include a description of the actions the Board and management will take to address any deficiencies. At least quarterly, management shall prepare, and the Board shall review, a written evaluation of the Bank’s performance against the Capital Plan, which shall include a description of the actions the Board and management will take to address any deficiencies. The Board’s monthly reviews and quarterly written evaluations shall be documented in the Board meeting minutes. The Board shall forward a copy of these monthly reviews and Board meeting minutes to the Assistant Deputy Comptroller within fifteen (15) days of completion of its quarterly written evaluations, respectively.

CAPITAL PLAN. (1) Within sixty (60) days of the date of this Agreement, the Board shall adopt an effective internal capital planning process to assess the Bank’s capital adequacy in relation to its overall risks and strategiesto ensure maintenance of appropriate capital levels. Thereafter, management shall implement, and the Board shall verify, no less than annually, adherence to the capital planning process. The capital planning process shall be consistent with safe and sound practices and ensure the integrity, objectivity, and consistency of the process through adequate governance. Refer to the “Capital and Dividends” booklet of the Comptroller’s Handbook. The Board shall document the initial capital planning process and thereafter review and document the capital planning process at least annually or more frequently, if appropriate, or required by the Assistant Deputy Comptroller ADC in writing. (2) Within sixty (60) days of the date of this Agreement, the Board shall submit to the Assistant Deputy Comptroller ADC for review and prior written determination of no supervisory objection an acceptable revised written capital plan for the Bank, consistent with the Strategic Plan required by Article IIIV, covering at least a three-year time frame period (“Capital Plan”). Refer to “Capital and Dividends” booklet of the Comptroller’s Handbook for guidanceHandbook. The Bank’s Capital Plan shall, at a minimum: (a) include specific plans for the achievement and ongoing maintenance of adequate capitalminimum capital ratios that communicate a clear risk tolerance; (b) an updated risk assessment within specific plans for maintenance of adequate capital that may in no event be less than the Capital Plan to ensure it considers all current and future threats to the Bank’s capital. Specifically, the Capital Plan shall include an updated assessment of the quantity and direction of credit, liquidity, interest rate, and operational risksratios established under subparagraph (a); (c) projections for growth and capital requirements based upon a detailed analysis of the Bank’s assets, liabilities, earnings, fixed assets, and off- balance sheet activities; (d) projections of the sources and timing of additional capital to meet the Bank’s current and future needs; (e) the primary source(s) from which the Bank must developwill strengthen its capital structure to meet the Bank’s needs; (f) contingency plans that identify alternative methods should the primary source(s) under subparagraph (e) not be available; and (g) procedures for routine capital stress testing, and the Asset / Liability Committee (ALCO) and Board must approve, a capital policy that includes, which shall at a minimum: (i) reasonable minimum capital requirements based on identify the risk assessment required by sub-paragraph (bperson(s) of this paragraphresponsible for overseeing the testing; (ii) identifies and establishes a strategy to strengthen define the Bank’s capital, including plans to seek capital injections into the Bankmethodology that will be utilized; (iii) measurable triggers/early warning indicators establish the frequency of testing; (iv) provide for the timely reporting to prompt board and management action to assess additional capital sourcesthe Board of testing results; and (ivv) identification and quantification of contingent sources of capital, including primary and alternate sources of capital as well as order of preference of these sources and the time required to access these sources; (d) include detailed quarterly financial projections which shall be consistent with the Strategic Plan required by Article III; and (e) include specific plans detailing how the Bank will comply with restrictions or requirements set forth in this Agreement that will have an impact on the Bank’s capitalprovide a process for taking appropriate action if testing shows significant vulnerabilities. (3) If the Bank’s Capital Plan outlines a sale or merger of the Bank, including a transaction pursuant to 12 U.S.C. § 215a-3, the Capital Plan shall, at a minimum, address the steps and the associated timeline to ensure that within one hundred twenty (120) days after the receipt of the ADC’s written determination of no supervisory objection to the Capital Plan, a definitive agreement for the sale or merger is executed. (4) The Bank may declare or pay a dividend or make a capital distribution only: (a) when the Bank is in compliance with its Board-approved Capital Plan and would remain in compliance with such Capital Plan immediately following the declaration or payment of any dividend or capital distribution; (b) when the dividend or capital distribution would comply with 12 U.S.C. §§ 56, 60 and 1831o(d)(1) and 12 C.F.R. § 3.11(a)(4); andU.S.C. (c) following the Assistant Deputy Comptroller’s ADC prior written determination of no supervisory objection to the dividend or capital distribution. (45) Within fifteen thirty (1530) days following receipt of the Assistant Deputy ComptrollerADC’s written determination of no supervisory objection to the Bank’s Capital Plan or to any subsequent amendment to the Capital Plan, the Board shall adopt and Bank management, subject to Board review and ongoing monitoring, shall immediately implement and thereafter ensure adherence to the Capital Plan. The Board shall review the effectiveness of the Capital Plan at least annually, no later than January 31 each year, and more frequently if necessary or if required by the OCC in writing, and amend the Capital Plan as needed or directed by the OCC. Any amendment to the Capital Plan must be submitted to the Assistant Deputy Comptroller ADC for review and prior written determination of no supervisory objection. (56) At least monthlyquarterly, the Board shall review financial reports and earnings analyses that evaluate the Bank’s performance against the goals and objectives established in the Capital Plan, as well as the Bank’s written explanation of significant differences between the actual and projected balance sheet, income statement, and expense accounts, including a description of any extraordinary and/or nonrecurring items. This review shall include a description of the actions the Board and management will take to address any deficiencies. At least quarterly, management shall prepare, and the Board shall review, a written evaluation of the Bank’s performance against the Capital Plan, which shall include a description of the actions the Board and management will take to address any deficiencies. The Board’s monthly quarterly reviews and quarterly written evaluations shall be documented in the Board meeting minutes. The Board shall forward a copy of these monthly quarterly reviews and written evaluations and Board meeting minutes to the Assistant Deputy Comptroller ADC within fifteen thirty (1530) days of completion of its quarterly reviews and written evaluations, respectively.

CAPITAL PLAN. (1) Within sixty (60) days of the date of this Agreement, the Board shall adopt an effective internal capital planning process to assess the Bank’s capital adequacy in relation to its overall risks and strategiesto ensure maintenance of appropriate capital levels. Thereafter, management shall implement, and the Board shall verify, no less than annually, adherence to the capital planning process. The capital planning process shall be consistent with safe and sound practices and ensure the integrity, objectivity, and consistency of the process through adequate governance. Refer to the “Capital and Dividends” booklet of the Comptroller’s Handbook. The Board shall document the initial capital planning process and thereafter review and document the capital planning process at least annually or more frequently, if appropriate, or required by the Assistant Deputy Comptroller ADC in writing. (2) Within sixty (60) days of the date of this Agreement, the Board shall submit to the Assistant Deputy Comptroller ADC for review and prior written determination of no supervisory objection an acceptable revised written capital plan for the Bank, consistent with the Strategic Plan required by Article IIIIII and paragraph (1) of this article, covering at least a three-year time frame period (“Capital Plan”). Refer to “Capital and Dividends” booklet of the Comptroller’s Handbook for guidance. Handbook. (3) The Bank’s Capital Plan shall, at a minimum: (a) include specific plans for the achievement and ongoing maintenance of adequate minimum capital, as required by applicable law and regulation or the OCC; (b) an updated risk assessment within the Capital Plan to ensure it considers identify and evaluate all current and future threats to the Bank’s capital. Specifically, the Capital Plan shall include an updated assessment of the quantity and direction of credit, liquidity, interest rate, and operational material risks; (c) the Bank must develop, and the Asset / Liability Committee (ALCO) and Board must approve, a capital policy that includes, at a minimum: (i) reasonable minimum capital requirements based on the risk assessment required by sub-paragraph (b) of this paragraph; (ii) identifies and establishes a strategy to strengthen determine the Bank’s capital, including plans capital needs in relation to seek capital injections into material risks and strategic direction consistent with the Bank; (iii) measurable triggers/early warning indicators to prompt board and management action to assess additional capital sources; and (iv) identification and quantification of contingent sources of capital, including primary and alternate sources of capital as well as order of preference of these sources and the time Strategic Plan required to access these sourcesby Article III; (d) identify and establish a strategy to maintain capital and strengthen capital if necessary and establish a contingency or back-up capital plan commensurate with the Bank’s overall risk and complexity; (e) include detailed quarterly financial projections which shall be consistent with the Strategic Plan required by Article III; and (ef) include specific plans detailing how the Bank will comply with restrictions or requirements set forth in this Agreement that will have an impact on the Bank’s capital. (34) The Bank may declare or pay a dividend or make a capital distribution only: (a) when the Bank is in compliance with its Board-approved Capital Plan and would remain in compliance with such Capital Plan immediately following the declaration or payment of any dividend or capital distribution; (b) when the dividend or capital distribution would comply with 12 U.S.C. §§ 56, 60 and 1831o(d)(1) and 12 C.F.R. § 3.11(a)(4); andU.S.C. (c) following the Assistant Deputy ComptrollerADC’s prior written determination of no supervisory objection to the dividend or capital distribution. (45) Within fifteen thirty (1530) days following receipt of the Assistant Deputy ComptrollerADC’s written determination of no supervisory objection to the Bank’s Capital Plan or to any subsequent amendment to the Capital Plan, the Board shall adopt and Bank management, subject to Board review and ongoing monitoring, shall immediately implement and thereafter ensure adherence to the Capital Plan. The Board shall review the effectiveness of the Capital Plan at least annually, no later than January 31 each year, and more frequently if necessary or if required by the OCC in writing, and amend the Capital Plan as needed or directed by the OCC. Any amendment to the Capital Plan must be submitted to the Assistant Deputy Comptroller ADC for review and prior written determination of no supervisory objection. (56) At least monthlyquarterly, the Board shall review financial reports and earnings analyses that evaluate the Bank’s performance against the goals and objectives established in the Capital Plan, as well as the Bank’s written explanation of significant differences between the actual and projected balance sheet, income statement, and expense accounts, including a description of any extraordinary and/or nonrecurring items. This review shall include a description of the actions the Board and management will take to address any deficiencies. At least quarterly, management shall prepare, and the Board shall review, a written evaluation of the Bank’s performance against the Capital Plan, which shall include a description of the actions the Board and management will take to address any deficiencies. The Board’s monthly quarterly reviews and quarterly written evaluations shall be documented in the Board meeting minutes. The Board shall forward a copy of these monthly reviews and quarterly written evaluations and Board meeting minutes to the Assistant Deputy Comptroller ADC within fifteen thirty (1530) days of completion of its monthly reviews and quarterly written evaluations, respectively. (7) If the Bank fails to submit a Capital Plan as required by paragraph (2) of this Article, or fails to implement a Capital Plan to which the ADC has provided a written determination of no supervisory objection, then the Bank may, in the ADC’s sole discretion, be deemed undercapitalized for purposes of this Agreement. Following written notification from the ADC that the Bank is deemed undercapitalized for purpose of this Agreement, the Bank shall take such corrective measures as the OCC may direct in writing from among the provisions applicable to undercapitalized depository institutions under 12 U.S.C. § 1831o(e) and 12 C.F.R. Part 6. For purposes of this requirement, an action “necessary to carry out the purpose of this section” under 12 U.S.C. § 1831o(e)(5) shall include any action deemed necessary by the OCC to address the Bank’s capital deficiency or the safety and soundness of its operations.

CAPITAL PLAN. (1) Within sixty (60) days of the date of this Agreement, the Board shall adopt an effective internal capital planning process to assess the Bank’s capital adequacy in relation to its overall risks and strategiesto ensure maintenance of appropriate capital levels. Thereafter, management shall implement, and the Board shall verify, no less than annually, adherence to the capital planning process. The capital planning process shall be consistent with safe and sound practices and ensure the integrity, objectivity, and consistency of the process through adequate governance. Refer to the “Capital and Dividends” booklet of the Comptroller’s Handbook. The Board shall document the initial capital planning process and thereafter review and document the capital planning process at least annually or more frequently, if appropriate, or required by the Assistant Deputy Comptroller in writing. (2) Within sixty (60) days of the date of this Agreement, the Board shall submit to the Assistant Deputy Comptroller for review and prior written determination of no supervisory objection an acceptable revised written capital plan for the Bank, consistent with the Strategic Plan required by Article III, III covering at least a three-year time frame period (“Capital Plan”). Refer to “Capital and Dividends” booklet of the Comptroller’s Handbook for guidance. Handbook. (3) The Bank’s Capital Plan shall, at a minimum: (a) include specific plans for the achievement and ongoing maintenance of adequate capitalcapital over the next three-year period, given the Board’s strategic goals and objectives; (b) an updated risk assessment within the Capital Plan to ensure it considers identify and evaluate all current and future threats to the Bank’s capital. Specifically, the Capital Plan shall include an updated assessment of the quantity and direction of credit, liquidity, interest rate, and operational material risks; (c) the Bank must develop, and the Asset / Liability Committee (ALCO) and Board must approve, a capital policy that includes, at a minimum: (i) reasonable minimum capital requirements based on the risk assessment required by sub-paragraph (b) of this paragraph; (ii) identifies and establishes a strategy to strengthen determine the Bank’s capital, including plans short -and long-term capital needs in relation to seek capital injections into the Bank; (iii) measurable triggers/early warning indicators to prompt board material risks and management action to assess additional capital sources; and (iv) identification and quantification of contingent sources of capital, including primary and alternate sources of capital as well as order of preference of these sources and the time required to access these sourcesstrategic direction; (d) identify and establish a strategy to maintain capital and strengthen capital if necessary and establish a contingency or back-up capital plan commensurate with the Bank’s overall risk and complexity; (e) include detailed quarterly financial projections which shall be consistent with the Strategic Plan required by Article III; and (ef) include specific plans detailing how the Bank will comply with restrictions or requirements set forth in this Agreement that will have an impact on the Bank’s capital, including the development and implementation of a capital stress testing process. (34) If the Bank’s Capital Plan outlines a sale or merger of the Bank, including a transaction pursuant to 12 U.S.C. § 215a-3, the Capital Plan shall, at a minimum, address the steps and the associated timeline to ensure that within sixty (60) days after the receipt of the Assistant Deputy Comptroller’s written determination of no supervisory objection to the Capital Plan, a definitive agreement for the sale and merger is executed. (5) The Bank may declare or pay a dividend or make a capital distribution only: (a) when the Bank is in compliance with its Board-approved Capital Plan and would remain in compliance with such Capital Plan immediately following the declaration or payment of any dividend or capital distribution; (b) when the dividend or capital distribution would comply with 12 U.S.C. §§ 56, 60 and 1831o(d)(1) and 12 C.F.R. § 3.11(a)(4); and (c) following the Assistant Deputy Comptroller’s prior written determination of no supervisory objection to the dividend or capital distribution. (46) Within fifteen thirty (1530) days following receipt of the Assistant Deputy Comptroller’s written determination of no supervisory objection to the Bank’s Capital Plan or to any subsequent amendment to the Capital Plan, the Board shall adopt and Bank management, subject to Board review and ongoing monitoring, shall immediately implement and thereafter ensure adherence to the Capital Plan. The Board shall review the effectiveness of the Capital Plan at least annually, no later than January 31 each year, and more frequently if necessary or if required by the OCC in writing, and amend the Capital Plan as needed or directed by the OCC. Any amendment to the Capital Plan must be submitted to the Assistant Deputy Comptroller for review and prior written determination of no supervisory objection. (57) At least monthly, the Board shall review financial reports and earnings analyses that evaluate the Bank’s performance against the goals and objectives established in the Capital Plan, as well as the Bank’s written explanation of significant differences between the actual and projected balance sheet, income statement, and expense accounts, including a description of any extraordinary and/or nonrecurring items. This review shall include a description of the actions the Board and management will take to address any deficiencies. At least quarterly, management shall prepare, and the Board shall review, a written evaluation of the Bank’s performance against the Capital Plan, which shall include a description of the actions the Board and management will take to address any deficiencies. The Board’s monthly reviews and quarterly written evaluations shall be documented in the Board meeting minutes. The Board shall forward a copy of these monthly reviews and quarterly written evaluations and Board meeting minutes to the Assistant Deputy Comptroller within fifteen five (155) days of completion of its quarterly written evaluations, respectivelycompletion.

CAPITAL PLAN. (1) Within sixty (60) days of the date of this Agreement, the Board shall adopt an effective internal capital planning process to assess the Bank’s capital adequacy in relation to its overall risks and strategiesto ensure maintenance of appropriate capital levels. Thereafter, management shall implement, and the Board shall verify, no less than annuallyquarterly, adherence to the capital planning process. The capital planning process shall be consistent with safe and sound practices and ensure the integrity, objectivity, and consistency of the process through adequate governance. Refer to the “Capital and Dividends” booklet of the Comptroller’s Handbook. The Board shall document the initial capital planning process and thereafter review and document the capital planning process at least annually or more frequently, if appropriate, or required by the Assistant Deputy Comptroller ADC in writing. (2) Within sixty (60) days of the date of this Agreement, the Board shall submit to the Assistant Deputy Comptroller ADC for review and prior written determination of no supervisory objection an acceptable revised written capital plan for the Bank, consistent with the Strategic Plan required by Article IIIIV, covering at least a three-three (3) year time frame period (“Capital Plan”). Refer to the “Capital and Dividends” booklet of the Comptroller’s Handbook for guidanceHandbook. The Bank’s revised Capital Plan shall, at a minimum: (a) include specific plans for the achievement and ongoing maintenance of adequate capital; (b) an updated risk assessment within the Capital Plan to ensure it considers identify and evaluate all current material risks and future threats establish reasonable early warning triggers tied to the Bank’s capital. Specifically, the Capital Plan shall include an updated assessment of the quantity actual capital levels and direction of credit, liquidity, interest rate, and operational risksratios; (c) develop and adhere to action plans in the Bank must develop, and the Asset / Liability Committee (ALCO) and Board must approve, a event that capital policy that includes, at a minimum: (i) reasonable minimum capital requirements based on the risk assessment required by sub-paragraph (b) of this paragraph; (ii) identifies and establishes a strategy to strengthen the Bank’s capital, including plans to seek capital injections into the Bank; (iii) measurable levels approach or breach triggers/early warning indicators to prompt board and management action to assess additional capital sources; and (iv) identification and quantification of contingent sources of capital, including primary and alternate sources of capital as well as order of preference of these sources and the time required to access these sources; (d) reassess the Bank’s tier 1 leverage ratio risk limit and capital needs in relation to material risks and strategic direction; (e) establish a contingency capital plan commensurate with the Bank’s overall risk and complexity that includes early warning triggers required by this Article; (f) develop realistic and detailed action plans that sufficiently address capital shortfalls in stressed scenarios as a result of stress testing; (g) establish a dividend policy that details the Board’s objectives and plans for declaring dividends; (h) include detailed quarterly financial projections which shall be consistent with the Strategic Plan required by Article IIIIV; and (ei) include specific plans detailing how the Bank will comply with restrictions or requirements set forth in this Agreement that will have an impact on the Bank’s capital. (3) The Bank may declare or pay a dividend or make a capital distribution only: (a) when the Bank is in compliance with its Board-approved Capital Plan and would remain in compliance with such Capital Plan immediately following the declaration or payment of any dividend or capital distribution; (b) when the Bank is in adherence with its dividend policy and has considered whether capital distributions are consistent with earnings performance, strategic plans, and the risk profile; (c) when the dividend or capital distribution would comply with 12 U.S.C. §§ 56, 60 and 1831o(d)(1) and 12 C.F.R. § 3.11(a)(4); and (cd) following the Assistant Deputy ComptrollerADC’s prior written determination of no supervisory objection to the dividend or capital distribution. (4) Within fifteen thirty (1530) days following receipt of the Assistant Deputy ComptrollerADC’s written determination of no supervisory objection to the Bank’s Capital Plan or to any subsequent amendment to the Capital Plan, the Board shall adopt and Bank management, subject to Board review and ongoing monitoring, shall immediately implement and thereafter ensure adherence to the Capital Plan. The Board shall review the effectiveness of the Capital Plan at least annually, no later than January 31 of each year, and more frequently if necessary or if required by the OCC in writing, and amend the Capital Plan as needed or directed by the OCC. Board minutes must capture risk discussions addressing internal risk limit breaches at least quarterly. Board meeting minutes must reflect review and discussion of the capital position relative to the risk profile and document efforts to bring capital levels into compliance with risk limits. Any amendment to the Capital Plan must be submitted to the Assistant Deputy Comptroller ADC for review and prior written determination of no supervisory objection. (5) At least monthlyquarterly, the Board shall review financial reports and earnings analyses that evaluate the Bank’s performance against the goals and objectives established in the Capital Plan, as well as the Bank’s written explanation of significant differences between the actual and projected balance sheet, income statement, and expense accounts, including a description of any extraordinary and/or nonrecurring items. This review shall include a description of the actions the Board and management will take to address any deficiencies. At least quarterly, management shall prepare, and the Board shall review, a written evaluation of the Bank’s performance against the Capital Plan, which shall include a description of the actions the Board and management will take to address any deficiencies. The Board’s monthly reviews and quarterly written evaluations shall be documented in the Board meeting minutes. The Board shall forward a copy of these monthly reviews and Board meeting minutes to the Assistant Deputy Comptroller within fifteen (15) days of completion of its quarterly written evaluations, respectively.

CAPITAL PLAN. (1) Within sixty ninety (6090) days of the date of this Agreement, the Board shall adopt an effective internal capital planning process to assess the Bank’s capital adequacy in relation to its overall risks and strategies. Thereafter, management shall implement, and the Board shall verify, no less than annually, adherence to the capital planning process. The capital planning process shall be consistent with safe and sound practices and ensure the integrity, objectivity, and consistency of the process through adequate governance. Refer to the “Capital and Dividends” booklet of the Comptroller’s Handbook. The Board shall document the capital planning process and thereafter review and document the capital planning process at least annually or more frequently, if appropriate, or required by the Assistant Deputy Comptroller in writing. (2) Within sixty ninety (6090) days of the date of this Agreement, the Board shall submit to the Assistant Deputy Comptroller for review and prior written determination of no supervisory objection an acceptable revised written capital plan for the Bank, consistent with the Strategic Plan required by Article IIIX, covering at least a three-year time frame timeframe (“Capital Plan”). Refer to “Capital and Dividends” booklet of the Comptroller’s Handbook for guidance. The Bank’s Capital Plan shall, at a minimum: (a) include specific plans for the achievement and ongoing maintenance of adequate capital; (b) an updated risk assessment within the Capital Plan to ensure it considers identify and evaluate all current and future threats to the Bank’s capital. Specifically, the Capital Plan shall include an updated assessment of the quantity and direction of credit, liquidity, interest rate, and operational material risks; (c) the Bank must develop, and the Asset / Liability Committee (ALCO) and Board must approve, a capital policy that includes, at a minimum: (i) reasonable minimum capital requirements based on the risk assessment required by sub-paragraph (b) of this paragraph; (ii) identifies and establishes a strategy to strengthen determine the Bank’s capital, including plans capital needs in relation to seek capital injections into the Bank; (iii) measurable triggers/early warning indicators to prompt board material risks and management action to assess additional capital sources; and (iv) identification and quantification of contingent sources of capital, including primary and alternate sources of capital as well as order of preference of these sources and the time required to access these sourcesstrategic direction; (d) include detailed quarterly financial projections which shall be consistent identify and establish a strategy to maintain capital and strengthen capital if necessary and establish a contingency or back-up capital plan commensurate with the Strategic Plan required by Article IIIBank’s overall risk and complexity; (e) incorporate available capital sources, confirm availability of capital sources, and establish thresholds for capital injection; and (ef) include specific plans detailing how incorporate results of capital stress testing that provide for: i. assumptions that reflect adequate severity; ii. incorporation of the Bank will comply with restrictions or requirements set forth in this Agreement that will have an impact on primary risks to the Bank’s capital, such as concentrations in non-owner-occupied commercial real estate, and reasonable loss assumptions; and iii. inclusion of both high probability/low impact events and low probability/high impact events. (3) The Bank may declare or pay a dividend or make a capital distribution only: (a) when the Bank is in compliance with its Board-approved Capital Plan and would remain in compliance with such Capital Plan immediately following the declaration or payment of any dividend or capital distribution; (b) when the dividend or capital distribution would comply with 12 U.S.C. §§ 56, 60 and 1831o(d)(1) and 12 C.F.R. § 3.11(a)(4); and§ (c) following the Assistant Deputy Comptroller’s prior written determination of no supervisory objection to the dividend or capital distribution. (4) Within fifteen thirty (1530) days following receipt of the Assistant Deputy Comptroller’s written determination of no supervisory objection to the Bank’s Capital Plan or to any subsequent amendment to the Capital Plan, the Board shall adopt and Bank management, subject to Board review and ongoing monitoring, shall immediately implement and thereafter ensure adherence to the Capital Plan. The Board shall review the effectiveness of the Capital Plan at least annually, no later than January 31 each year, and more frequently if necessary or if required by the OCC in writing, and amend the Capital Plan as needed or directed by the OCC. Any amendment to the Capital Plan must be submitted to the Assistant Deputy Comptroller for review and prior written determination of no supervisory objection. (5) At least monthlyquarterly, the Board shall review financial reports and earnings analyses that evaluate the Bank’s performance against the goals and objectives established in the Capital Plan, as well as the Bank’s written explanation of significant differences between the actual and projected balance sheet, income statement, and expense accounts, including a description of any extraordinary and/or nonrecurring items. This review shall include a description of the actions the Board and management will take to address any deficiencies. At least quarterly, management shall prepare, and the Board shall review, a written evaluation of the Bank’s performance against the Capital Plan, which shall include a description of the actions the Board and management will take to address any deficiencies. The Board’s monthly quarterly reviews and quarterly written evaluations shall be documented in the Board meeting minutes. The Board shall forward a copy of these monthly quarterly reviews and Board meeting minutes to the Assistant Deputy Comptroller within fifteen thirty (1530) days of completion of its quarterly written evaluations, respectively.

CAPITAL PLAN. (1) Within sixty (60) days of the date of this Agreement, the Board shall adopt an effective internal capital planning process to assess the Bank’s capital adequacy in relation to its overall risks and strategiesto ensure maintenance of appropriate capital levels. Thereafter, management shall implement, and the Board shall verify, no less than annually, adherence to the capital planning process. The capital planning process shall be consistent with safe and sound practices and ensure the integrity, objectivity, and consistency of the process through adequate governance. Refer to the “Capital and Dividends” booklet of the Comptroller’s Handbook. The Board shall document the initial capital planning process and thereafter review and document the capital planning process at least annually or more frequently, if appropriate, or required by the Assistant Deputy Comptroller ADC in writing. (2) Within sixty (60) days of the date of this Agreement, the Board shall submit to the Assistant Deputy Comptroller ADC for review and prior written determination of no supervisory objection an acceptable revised written capital plan for the Bank, consistent with the Strategic Plan required by Article III, covering at least a three-year time frame period (“Capital Plan”). Refer to “Capital and Dividends” booklet of the Comptroller’s Handbook for guidance. Handbook. (3) The Bank’s Capital Plan shall, at a minimum: (a) include specific plans for the achievement and ongoing maintenance of adequate capital; (b) an updated risk assessment within the Capital Plan to ensure it considers identify and evaluate all current and future threats to the Bank’s capital. Specifically, the Capital Plan shall include an updated assessment of the quantity and direction of credit, liquidity, interest rate, and operational material risks; (c) the Bank must develop, and the Asset / Liability Committee (ALCO) and Board must approve, a capital policy that includes, at a minimum: (i) reasonable minimum capital requirements based on the risk assessment required by sub-paragraph (b) of this paragraph; (ii) identifies and establishes a strategy to strengthen determine the Bank’s capital, including plans capital needs and limits in relation to seek capital injections into the Bank; (iii) measurable triggers/early warning indicators to prompt board material risks and management action to assess additional capital sources; and (iv) identification and quantification of contingent sources of capital, including primary and alternate sources of capital as well as order of preference of these sources and the time required to access these sourcesstrategic direction; (d) identify and establish a strategy to maintain capital and strengthen capital if necessary and establish a contingency or back-up capital plan commensurate with the Bank’s overall risk and complexity; (e) include detailed quarterly financial projections which shall be consistent with the Strategic Plan required by Article III; and (ef) include specific plans detailing how the Bank will comply with restrictions or requirements set forth in this Agreement that will have an impact on the Bank’s capital. (34) The Bank may declare or pay a dividend or make a capital distribution only: (a) when the Bank is in compliance with its Board-approved Capital Plan and would remain in compliance with such Capital Plan immediately following the declaration or payment of any dividend or capital distribution; (b) when the dividend or capital distribution would comply with 12 U.S.C. §§ 56, 60 and 1831o(d)(1) and 12 C.F.R. § 3.11(a)(4); and (c) following the Assistant Deputy ComptrollerADC’s prior written determination of no supervisory objection to the dividend or capital distribution. (45) Within fifteen thirty (1530) days following receipt of the Assistant Deputy ComptrollerADC’s written determination of no supervisory objection to the Bank’s Capital Plan or to any subsequent amendment to the Capital Plan, the Board shall adopt and Bank management, subject to Board review and ongoing monitoring, shall immediately implement and thereafter ensure adherence to the Capital Plan. The Board shall review the effectiveness of the Capital Plan at least annually, no later than January 31 each year, and more frequently if necessary or if required by the OCC in writing, and amend the Capital Plan as needed or directed by the OCC. Any amendment to the Capital Plan must be submitted to the Assistant Deputy Comptroller ADC for review and prior written determination of no supervisory objection. (56) At least monthlyquarterly, the Board shall review financial reports and earnings analyses that evaluate the Bank’s performance against the goals and objectives established in the Capital Plan, as well as the Bank’s written explanation of significant differences between the actual and projected balance sheet, income statement, and expense accounts, including a description of any extraordinary and/or nonrecurring items. This review shall include a description of the actions the Board and management will take to address any deficiencies. At least quarterly, management shall prepare, and the Board shall review, a written evaluation of the Bank’s performance against the Capital Plan, which shall include a description of the actions the Board and management will take to address any deficiencies. The Board’s monthly quarterly reviews and quarterly written evaluations shall be documented in the Board meeting minutes. The Board shall forward a copy of these monthly quarterly reviews and quarterly written evaluations and Board meeting minutes to the Assistant Deputy Comptroller ADC within fifteen thirty (1530) days of completion of its quarterly reviews and quarterly written evaluations, respectively. (7) If the Bank fails to submit a Capital Plan as required by paragraph (2) of this Article, or fails to implement a Capital Plan to which the ADC has provided a written determination of no supervisory objection, then the Bank may, in the ADC’s sole discretion, be deemed undercapitalized for purposes of this Agreement. Following written notification from the ADC that the Bank is deemed undercapitalized for purpose of this Agreement, the Bank shall take such corrective measures as the OCC may direct in writing from among the provisions applicable to undercapitalized depository institutions under 12 U.S.C. § 1831o(e) and 12 C.F.R. Part 6. For purposes of this requirement, an action “necessary to carry out the purpose of this section” under 12 U.S.C. § 1831o(e)(5) shall include any action deemed necessary by the OCC to address the Bank’s capital deficiency or the safety and soundness of its operations.