text: Furthermore, each subsidiary bank must periodically report all loans made to directors and other insiders to the 
  bank regulators, and these loans are closely scrutinized by the regulators for compliance with Sections 22(g) and 
  22(h) of the Federal Reserve Ace and Regulation O. 
  
  *Capital*
  
  *Bank Holding Companies and Financial Holding Companies*. The Federal Reserve Board has adopted risk- 
  based capital guidelines for bank holding companies and financial holding companies. The ratio of total capital to 
  risk weighted assets (including certain off-balance-sheet activities, such as standby letters of credit) must be a 
  minimum of eight percent. At least half of the total capital is to be composed of common shareholders’ equity, 
  minority interests in the equity accounts of consolidated subsidiaries and a limited amount of perpetual preferred 
  stock, less goodwill, which is collectively referred to as Tier 1 Capital. The remainder of total capital may consist of 
  subordinated debt, other preferred stock and a limited amount of loan loss reserves. 