CF Bankshares (CFBK) risk factors, FY2024 10-K

Other

1. 01Economic, Market and Political Risks
2. 02Changes in economic and political conditions could adversely affect our earnings through declines in deposits, loan demand, the ability of our customers to repay loans and the value of the collateral securing our loans
3. 03Changing interest rates may decrease our earnings and asset values
4. 04Defaults by other financial institutions could adversely affect our business, earnings and financial condition

Risks Related to Our Lending Activities

1. 05Our allowance for credit losses may not be adequate to absorb the expected, lifetime losses in our loan portfolio
2. 06Our emphasis on commercial, commercial real estate and multi-family residential real estate lending may expose us to increased lending risks
3. 07Our adjustable-rate loans may expose us to increased lending risks
4. 08We may be required to repurchase loans we have sold or indemnify loan purchasers under the terms of the sale agreements, which could adversely affect our liquidity, results of operations and financial condition
5. 09We depend upon the accuracy and completeness of information about customers and counterparties
6. 10Our business and financial results are subject to risks associated with the creditworthiness of our customers and counterparties

Risks Related to Our Business Operations

1. 11We may not be able to effectively manage our growth
2. 12Future acquisitions or other expansion may adversely affect our financial condition and results of operations
3. 13the risk of loss of key employees and customers
4. 14We face strong competition from other financial institutions, financial services companies and other organizations offering services similar to those offered by us, which could result in our not being able to sustain or grow our loan and deposit businesses
5. 15banking locations and mount extensive promotional and advertising campaigns
6. 16We rely heavily on our management team and other key employees, and the unexpected loss of key employees may adversely affect our operations
7. 17We are exposed to operational risk
8. 18Unauthorized disclosure of sensitive or confidential client information or breaches in security of our systems could severely harm our business
9. 19Our business could be adversely affected through third parties who perform significant operational services on our behalf
10. 20Derivative transactions may expose us to unexpected risk and potential losses
11. 21We operate in a highly regulated industry, and the laws and regulations that govern our operations, corporate governance, executive compensation and financial accounting, or reporting, including changes in, or failure to comply with the same, may adversely affect the Company
12. 22Legislative or regulatory changes or actions could adversely impact our business
13. 23We are subject to limitations and conditions on certain activities as a result of our “Needs to Improve” CRA rating
14. 24Deposit insurance premiums may increase and have a negative effect on our results of operations
15. 25We may be the subject of litigation which could result in legal liability and damage to our business and reputation
16. 26Changes in accounting standards, policies, estimates or procedures could impact our reported financial condition or results of operations
17. 27Noncompliance with the Bank Secrecy Act (BSA) and other anti-money laundering statutes and regulations could cause a material financial loss

Risks Related to our Capital and Capital Stock

1. 28We are a holding company and depend on our subsidiary bank for dividends
2. 29We may elect or need to raise additional capital in the future, but capital may not be available when it is needed
3. 30Although publicly traded, our Common Stock has less liquidity than the average liquidity of stocks listed on NASDAQ
4. 31The market price of our Common Stock may be subject to fluctuations and volatility
5. 32other changes in U.S. or global financial markets, global economies and general market conditions, such as interest or foreign exchange rates, stock, commodity, credit or asset valuations or volatility
6. 33Provisions in the Holding Company’s Amended and Restated Certificate of Incorporation and statutory provisions could discourage a hostile acquisition of control
7. 34Additionally, federal banking laws contain various restrictions on acquisitions of control of national banks and their holding companies
8. 35Adverse changes in the financial markets may adversely impact our results of operations
9. 36We are at risk of increased losses from fraud
10. 37We may experience increasing scrutiny and evolving expectations from customers, regulators, investors, and other stakeholders with respect to the Company’s environmental, social and governance practices
11. 38Changes in tax laws could adversely affect our performance
12. 39We need to constantly update our technology in order to compete and meet customer demands
13. 40Climate change, severe weather, natural disasters, acts of war or terrorism and other external events could significantly impact our business