Bank7 (BSVN) risk factors, FY2025 10-K

Risks Relating to Our Business and Market

1. 01We have identified a material weakness in our internal control over financial reporting, which could, if not remediated, result in material misstatements of our financial statements and adversely affect our stock priceNew
2. 02While we have not identified any material misstatements in our financial statements for the period ended December 31, 2025 as a result of these material weaknesses, these weaknesses create a reasonable possibility that a future material misstatement would not be prevented or detectedNew
3. 03Our business is primarily affected by the economies of Oklahoma, Texas and to a smaller degree the state of Kansas. Our success depends to a significant extent upon the business activity, population, income levels, employment trends, deposits and real estate activity in these markets
4. 04We have credit exposure to the energy industry28% rewritten
5. 05We have credit exposure to the hospitality industry24% rewritten
6. 06We have a concentration in commercial real estate lending that could cause our regulators to restrict our ability to grow
7. 07Because a portion of our loan portfolio is comprised of real estate loans, negative changes in the economy affecting real estate values and liquidity could impair the value of collateral securing our real estate loans and result in loan and other losses
8. 08Many of our loans are to commercial borrowers, which have a higher degree of risk than other types of loans
9. 09Our largest loan relationships make up a material percentage of our total loan portfolio 30% rewritten
10. 10Our largest deposit relationships currently make up a material percentage of our deposits and the withdrawal of deposits by our largest depositors could force us to fund our business through more expensive and less stable sources
11. 11A substantial portion of our loan portfolio consists of loans maturing within one year, and there is no guarantee that these loans will be replaced upon maturity or renewed on the same terms or at all
12. 12Our allowance for credit losses may not be adequate to cover our actual credit losses, which could adversely affect our earnings
13. 13Our profitability depends on interest rates generally, and we may be adversely affected by changes in market interest rates24% rewritten
14. 14We rely on short-term funding, which can be adversely affected by local and general economic conditions26% rewritten
15. 15Liquidity risk could impair our ability to fund operations and meet our obligations as they become due and could jeopardize our financial condition
16. 16Our operations could be interrupted if our third-party service providers experience difficulty, terminate their services or fail to comply with banking regulations
17. 17We may be exposed to risk of environmental liabilities with respect to properties to which we take title
18. 18Inflationary pressures and rising prices may affect our results of operations and financial condition46% rewritten
19. 19A natural disaster affecting our market areas could adversely affect the Company’s financial condition and results of operations

Risks Relating to Our Regulatory Environment

1. 20We are subject to extensive regulation, which increases the cost and expense of compliance and could limit or restrict our activities, which in turn may adversely impact our earnings and ability to grow
2. 21Monetary policy and other economic factors could affect our profitability adversely
3. 22Regulations relating to privacy, information security and data protection could increase our costs, affect or limit how we collect and use personal information and adversely affect our business opportunities

Risks Related to Our Common Stock

1. 23Shares of certain shareholders may be sold into the public market. This could cause the market price of our common stock to drop significantly
2. 24We are controlled by insiders, whose interests may not coincide with our other shareholders
3. 25We are a bank holding company and our only source of cash, other than further issuances of securities, is distributions from the Bank