required by federal law to obtain the prior approval of the Federal Reserve Board and the OCC, respectively, to
declare and pay dividends if the total of all dividends declared in any calendar year would exceed the total of (1)
such bank’s net profits (as defined and interpreted by regulation) for that year plus (2) its retained net profits (as
defined and interpreted by regulation) for the preceding two calendar years, less any required transfers to surplus. In
addition, these banks may only pay dividends to the extent that retained net profits (including the portion transferred
to surplus) exceed bad debts (as defined by regulation).