Citizens Financial Services's biggest risks in the FY2024 10-K
- Citizens Financial Services relies heavily on geographic concentrations in Pennsylvania and New York, significant agricultural lending exposures, and commercial real estate.
The risks most specific to Citizens Financial Services
- RISKS RELATED TO OUR LENDING ACTIVITIES
Activities related to the drilling for natural gas in the Marcellus and Utica Shale formations impacts certain customers of the Bank
The local economy in north central Pennsylvania depends heavily on natural gas exploration and drilling in the Marcellus and Utica Shale formations.
- RISKS RELATED TO OUR LENDING ACTIVITIES
Our emphasis on commercial real estate, agricultural real estate, construction and other commercial loan lending may expose us to increased lending risks
Commercial real estate, agricultural real estate, construction, and other commercial loans comprise $1.12 billion, $327.7 million, $164.3 million, and $131.3 million of the portfolio, respectively.
- RISKS RELATED TO OUR LENDING ACTIVITIES
Agricultural loans are dependent for repayment on the successful operation and management of the farm property, the health of the agricultural industry broadly, and on the location of the borrower in particular, and other factors outside of the borrower’s control
Agricultural loans total $357.4 million, representing 15.5% of the total loan portfolio, leaving the bank vulnerable to dairy, beef, poultry, swine, and crop industry conditions.
- RISKS RELATED TO OUR LENDING ACTIVITIES
Loan participations comprise a portion of our loan portfolio and a decline in loan participation volume could hurt profits and slow loan growth
The bank actively engages in loan participations originated by lead lenders, and a decline in this volume could hurt profits and slow loan growth.
- RISKS RELATED TO OUR MARKET AREA
The Company’s financial condition and results of operations are dependent on the economy in the Bank’s market area
Operations are concentrated in specific counties across Pennsylvania and southern New York, tying financial performance directly to the economic health of these regions.
- RISKS RELATED TO COMPETITION
Strong competition within the Bank’s market areas could hurt profits and slow growth
Intense competition in the bank's market areas forces it to offer higher deposit rates and lower loan prices, which can reduce net interest income.
- RISKS RELATED TO OUR MERGER AND ACQUISITION ACTIVITY
We may fail to realize all of the anticipated benefits of entering new markets
Entering new banking markets through acquisitions and hiring new lending teams carries the risk of failing to realize anticipated benefits and cost savings.
All 20 risk factors
Headings as the filing states them, in filing order.
RISKS RELATED TO CHANGES IN MARKET INTEREST RATES
- 01Changing interest rates may decrease our earnings and asset values
RISKS RELATED TO OUR LENDING ACTIVITIES
- 02Activities related to the drilling for natural gas in the Marcellus and Utica Shale formations impacts certain customers of the Bank
- 03Higher credit losses could require us to increase our allowance for credit losses through a charge to earnings
- 04Our emphasis on commercial real estate, agricultural real estate, construction and other commercial loan lending may expose us to increased lending risks
- 05Agricultural loans are dependent for repayment on the successful operation and management of the farm property, the health of the agricultural industry broadly, and on the location of the borrower in particular, and other factors outside of the borrower’s control
- 06Disruptions in the supply chain and the processing of product and delivery to the final retail channel
- 07Loan participations comprise a portion of our loan portfolio and a decline in loan participation volume could hurt profits and slow loan growth
- 08Environmental liability associated with lending activities could result in losses
RISKS RELATED TO OUR SECONDARY MORTGAGE OPERATIONS
- 09Income from secondary mortgage market operations is volatile, and we may incur losses or charges with respect to our secondary mortgage market operations which would negatively affect our earnings
RISKS RELATED TO OUR MARKET AREA
- 10The Company’s financial condition and results of operations are dependent on the economy in the Bank’s market area
RISKS RELATED TO LAWS AND REGULATIONS
- 11Regulation of the financial services industry is significant, and future legislation could increase our cost of doing business or harm our competitive position
- 12Our ability to pay dividends is limited by law
- 13Federal and state banking laws, our articles of incorporation and our by-laws may have an anti-takeover effect
RISKS RELATED TO COMPETITION
- 14Strong competition within the Bank’s market areas could hurt profits and slow growth
RISKS RELATED TO OUR OPERATIONS
- 15We rely on our management and other key personnel, and the loss of any of them may adversely affect our operations
- 16We are periodically subject to examination and regulation by a number of banking agencies and, depending upon the findings and determinations of these agencies, we may be required to make adjustments to our business that could adversely affect us
- 17We are subject to certain risks in connection with our use of technology
- 18Our risk management framework may not be effective in mitigating risks and/or losses to us
RISKS RELATED TO OUR MERGER AND ACQUISITION ACTIVITY
- 19Impairment of goodwill could require charges to earnings, which could result in a negative impact on our results of operations
- 20We may fail to realize all of the anticipated benefits of entering new markets
Other Citizens Financial Services 10-Ks
- FY2025 10-K risk factors22 risks2 new3 reworded
The bank added risks regarding investment portfolio impairments and technological disintermediation from digital assets and blockchain.
Filed Mar 12, 2026
About this page
The headings are the filing's own. The one-line readings and the overview are automated and can be wrong: read Item 1A of the 10-K for the exact wording.