Community Trust Bancorp (CTBI) risk factors, FY2025 10-K

Other

1. 01CTBI may continue to be adversely affected by economic and market conditions
2. 02Our business may continue to be adversely affected by ongoing weaknesses in the local economies on which we depend
3. 03Our business may be adversely impacted by climate change and related initiatives
4. 04We may face risks related to epidemics, pandemics or other infectious disease outbreaks, which could result in a widespread health crisis that adversely affects general commercial activity, the global economy (including the states and local economies in which we operate), and financial markets

Operational Risks

1. 05Changes in interest rates could adversely affect our earnings and financial condition
2. 06Changes in market interest rates will also affect the level of voluntary prepayments on our loans and the receipt of payments on our mortgage-backed securities resulting in the receipt of proceeds that may be reinvested at a lower rate than the loan or mortgage-backed security being prepaid
3. 07Our earnings and reputation may be adversely affected if we fail to effectively manage our credit risk
4. 08Our loan portfolio includes loans with a higher risk of loss
5. 09A significant part of our lending business is focused on small to medium-sized business which may be impacted more severely during periods of economic weakness
6. 10Strong competition within our market area may reduce our ability to attract and retain deposits and originate loans

Operational Risk

1. 11An extended disruption of vital infrastructure or a security breach could negatively impact our business, results of operations, and financial condition
2. 12Claims and litigation may arise pertaining to fiduciary responsibility
3. 13Significant legal actions could subject us to uninsured liabilities

Technology Risk

1. 14CTBI continually encounters technological change
2. 15A breach in the security of our systems could disrupt our business, result in the disclosure of confidential information, damage our reputation, and create significant financial and legal exposure for us
3. 16We could incur increased costs or reductions in revenue or suffer reputational damage in the event of misuse of information
4. 17The soundness of other financial institutions could adversely affect CTBI
5. 18We may experience difficulty in making acquisitions on acceptable terms due to the decreasing number of suitable acquisition targets, competition for attractive acquisitions, regulatory impediments, and certain limitations on interstate acquisitions
6. 19Anti-competitive concerns with the proposed transaction
7. 20We may not be able to achieve the expected integration and cost savings from our bank acquisition activities

Market Risk

1. 21CTBI’s stock price is volatile
2. 22Additional governmental policies and enforcement of current laws
3. 23CTBI is subject to liquidity risk
4. 24Adverse developments affecting the financial services industry, such as bank failures or concerns involving liquidity, may have a material effect on our operations

Risks Related to Regulatory Policies and Oversight

1. 25The banking industry is heavily regulated, and our business may be adversely affected by legislation or changes in regulatory policies and oversight
2. 26We are required to maintain certain minimum amounts and types of capital and may be subject to more stringent capital requirements in the future. A failure to meet applicable capital requirements could have a material adverse effect on our financial condition and results of operations
3. 27We are subject to environmental liability risk associated with lending activity