BNCCORP, Inc. (BNCC)

[Enterprising Investor]

Federal Reserve must approve interest and dividend payments under TARP.

I think the word "leverage" was used in the context of holding capital in excess of what is actually required by regulators to operate its bank rather than a need to obtain more.

At the Bank level, Total Capital (to risk-weighted assets) was $89.1 million or 22.41 percent at 9/30/12. In order to be "Adequate", the Bank would need capital at or greater than 8 percent ($31.8 million). "Well Capitalized" requires 10 percent ($39.8 million).

BNC National Bank Tier 1 Capital (to average assets) is $84 million or 11.73 percent. "Adequate" requires 4 percent ($28.7 million), while to be "Well Capitalized" the Bank needs 5 percent (35.8 million).

Regulatory capital requirements are not easy to explain. I will now try to simplify. With the capital already on hand, BNC National Bank could actually operate at nearly twice its current size.