First Busey (BUSE) risk factors, 2025 10-K

OPERATIONAL RISKS

1. 01Conditions in the financial market and economic conditions, including conditions in the states in which it operates, generally may adversely affect Busey’s business
2. 02Shifts in consumer and business behavior during economic uncertainty may impact Busey’s business
3. 03Regional economic vulnerabilities and reliance on key industries may heighten risks
4. 04Prolonged elevated interest rates followed by easing cycles create financial volatility
5. 05Declining interest rates result in reduced income from lending and investment activities, and may drive consumers to seek higher-yielding alternatives outside of traditional banking, both of which could negatively impact Busey’s liquidity and results of operations
6. 30Busey’s framework for managing risks may not be fully effective in mitigating risk and loss
7. 31Technological investments drive efficiency but introduce cybersecurity risks
8. 32Outsourcing dependencies could disrupt operations and increase compliance risks
9. 33This cascading outsourcing structure adds complexity to communication and coordination, particularly when vendors operate in regions with varying regulatory standards. Risks are further amplified by geopolitical tensions, trade restrictions, or cyberattacks targeting these external partners
10. 34The rising sophistication of fraudulent schemes poses a persistent challenge for financial institutions, with Busey being no exception. Fraudulent activities, such as identity theft, phishing, and unauthorized transactions, could result in financial losses, regulatory penalties, and erosion of customer trust
11. 35Busey’s ability to attract and retain experienced management and qualified personnel is critical to sustaining growth and executing its strategic objectives. The leadership transitions associated with the CrossFirst merger highlight the importance of talent management in preserving operational continuity
12. 36Damage resulting from negative publicity could harm Busey’s reputation and adversely impact its business and financial condition
13. 37Rapid adoption of generative artificial intelligence technologies introduces operational vulnerabilities

REGULATORY AND LEGAL RISKS

1. 06Changes in government policies and regulatory frameworks could adversely affect operations and profitability
2. 07Table of Contents Contents of Item 1A. Risk Factors
3. 08As Busey continues to grow in asset size and complexity, regulatory expectations and scrutiny will increase and could have a potential impact on Busey’s operations and business
4. 09Evolving privacy, data protection, and information security laws and regulations present operational and legal challenges
5. 10Laws impacting cannabis-related businesses may have an impact on Busey’s operations and risk profile
6. 11Busey is or may become involved from time to time in suits, legal proceedings, information-gathering requests, investigations, and proceedings by governmental and self-regulatory agencies that may lead to adverse consequences
7. 12Heightened credit risk associated with lending activities may result in insufficient credit loss provisions, which could have material adverse effects on Busey’s results of operations and financial condition
8. 13High levels of non-performing assets could reduce Busey’s profitability and strain operational resources
9. 14Loan concentrations in volatile markets could increase Busey’s exposure to economic downturns, adversely impacting financial stability
10. 15Declining borrower cash flows and fluctuating collateral values may lead to significant losses across Busey’s commercial loan portfolio
11. 16Real estate construction, land acquisition, and development loans are based upon estimates of costs and values associated with the complete project. These estimates may be inaccurate, and Busey may be exposed to significant losses on loans for these projects
12. 17Credit quality deterioration in investment securities may result in significant realized losses, impacting Busey’s financial performance
13. 18Failure to maintain sufficient capital to meet regulatory requirements could have material adverse effects on financial condition, liquidity, results of operations, and regulatory compliance
14. 19Liquidity risks could affect operations and jeopardize Busey’s business, financial condition, and results of operations
15. 20If securities or industry analysts do not publish or cease publishing research reports about Busey, if they adversely change their recommendations regarding Busey’s stock, or if Busey’s operating results do not meet their expectations, the price of Busey’s stock could decline
16. 21Intense competition from traditional banks and fintech companies threatens market share
17. 22Failure to adapt to rapid technological advancements could erode competitiveness
18. 23Busey’s strategy of pursuing acquisitions exposes Busey to financial, execution, and operational risks that could negatively affect Busey
19. 24Introduction of new products and services carries financial and strategic risks
20. 25Digital asset trends introduce regulatory, competitive and scalability challenges
21. 26Financial statements are created, in part, by estimates, assumptions, and methods used by management, which, if incorrect, could cause unexpected losses in the future
22. 27Changes in accounting principles or guidelines could adversely affect financial reporting
23. 28Busey is subject to changes in tax law and may not realize tax benefits which could adversely affect its results of operations
24. 29Investments in tax-advantaged projects may not generate returns as anticipated and may have an adverse impact on Busey’s financial results