C & F Financial (CFFI) risk factors, FY2024 10-K

Other

1. 01Our business is subject to various lending and other economic risks that could adversely affect our results of operations and financial condition
2. 02Our earnings are significantly affected by the fiscal and monetary policies of the federal government and its agencies
3. 03Adverse changes in economic conditions in our market areas or adverse conditions in an industry on which a local market in which we do business is dependent could adversely affect our results of operations and financial condition
4. 04Weakness in the secondary residential mortgage loan markets or demand for mortgage loans may adversely affect income from C&F Mortgage
5. 05If our allowance for credit losses becomes inadequate, our results of operations may be adversely affected
6. 06effect on the Corporation’s net income. Although we believe our allowance for credit losses is adequate to absorb losses that are inherent in our loan portfolio, we cannot predict the timing or severity of such losses nor give any assurance that our allowance will be adequate in the future
7. 07An increase in mortgage loan defaults or prepayments may result in losses related to loans sold by C&F Mortgage
8. 08Our level of credit risk is higher due to the concentration of our loan portfolio in commercial real estate loans and in consumer finance automobile loans
9. 09Our business, financial condition, and results of operations could be adversely affected by developments impacting the financial services industry, such as bank failures or concerns involving liquidity
10. 10We are subject to interest rate risk and fluctuations in interest rates may negatively affect our financial performance
11. 11We rely substantially on deposits obtained from customers in our target markets to provide liquidity and support growth
12. 12Consumers may increasingly decide not to use banks to complete their financial transactions, which could have a material adverse impact on our financial condition and operations
13. 13Competition from other financial institutions and financial intermediaries may adversely affect our profitability
14. 14Accounting for business combinations may expose us to intangible asset risk, which could affect our results of operations
15. 15Our risk management framework may not be effective in mitigating risk and loss
16. 16We are subject to security and operational risks, including cybersecurity risks and cybersecurity attacks, relating to our use of technology that could damage our reputation and our business
17. 17We rely on other companies to provide key components of our business infrastructure
18. 18Our business is technology dependent, and an inability to successfully implement technological improvements may adversely affect our ability to be competitive and our results of operations and financial condition
19. 19The development and use of Artificial Intelligence (“AI”) presents risks and challenges that may adversely impact our business

Risks Related to the Regulation of the Corporation

1. 20Compliance with laws, regulations and supervisory guidance, both new and existing, may adversely affect our business, financial condition and results of operations
2. 21The financial services industry may be subject to new or changing legislation, regulation, and government policy, which could affect the banking industry and the broader economy
3. 22The CFPB may increase our regulatory compliance burden and could affect the consumer financial products and services that we offer
4. 23Increased scrutiny and evolving expectations from customers, regulators, investors, and other stakeholders with respect to environmental, social and governance (ESG) practices may impose additional costs on the Corporation or expose it to new or additional risks

Risks Related to Owning the Corporation’s Common Stock

1. 24The trading volume of our common stock may not provide adequate volume for investors, and future sales of our common stock by shareholders or the perception that those sales could occur may cause our common stock price to decline
2. 25The Corporation’s dividends may not be sustained
3. 26Our common stock price may be volatile, which could result in losses to our investors
4. 27Future issuances of our common stock could adversely affect the market price of our common stock and could be dilutive
5. 28We rely heavily on our management team and the unexpected loss of key officers may adversely affect our operations
6. 29The success of our business strategies depends on our ability to identify, recruit and retain individuals with experience and relationships in our primary markets
7. 30The Corporation or any of its subsidiaries is a defendant from time to time in a variety of litigation and other actions