FB Bancorp (FBLA) risk factors, FY2024 10-K

Risks Related to Our Lending Activities

1. 01The Company’s commercial real estate loans involve credit risks that could adversely affect its financial condition and results of operations
2. 02The Company’s commercial loans involve credit risks that could adversely affect its financial condition and results of operations
3. 03The unseasoned nature of recently originated loans, in particular, commercial real estate and commercial loans, may result in changes in estimating collectability, which may lead to additional provisions or charge-offs, which could hurt the Company’s profits
4. 04If the Company’s allowance for credit losses is not sufficient to cover actual loan losses, its earnings could decrease
5. 05method of providing allowances for loan losses that are incurred or probable, which required the Company to increase its allowance for credit losses, and to greatly increase the types of data it must collect and review to determine the appropriate level of the allowance for credit losses
6. 06The geographic concentration of the Company’s loan portfolio and lending activities makes the Company vulnerable to a downturn in the local economy
7. 07a decrease in interest income from variable rate loans due to declines in interest rates; and
8. 08The Company is subject to environmental liability risk associated with lending activities or properties it owns

Risks Related to Market Interest Rates

1. 09Inflationary pressures and rising prices may affect our results of operations and financial condition
2. 10Hedging against interest rate exposure may adversely affect our earnings
3. 11Our securities portfolio performance in difficult market conditions could have adverse effects on our results of operations
4. 12Future changes in interest rates could reduce our profits and asset values
5. 13the interest expense we pay on interest-bearing liabilities, such as deposits and borrowings
6. 14Any substantial, unexpected, prolonged change in market interest rates could have a material adverse effect on our financial condition, liquidity and results of operations. Changes in the level of interest rates also may negatively affect the value of our assets and ultimately affect our earnings

Risks Related to Our Business Strategy and Operational Matters

1. 15Our business strategy includes growth, and our financial condition and results of operations could be negatively affected if we fail to grow or fail to manage our growth effectively. Growing our operations could also cause our expenses to increase faster than our revenues
2. 16Development of new products and services may impose additional costs on the Company and may expose the Company to increased operational risk
3. 17We face significant operational risks because of our reliance on technology. Our information technology systems may be subject to failure, interruption or security breaches
4. 18We outsource critical operations to third-party service providers. Systems failures, interruptions and cybersecurity breaches could have a material adverse effect on us
5. 19Our business may be adversely affected by an increasing prevalence of fraud and other financial crimes
6. 20Societal responses to climate change could adversely affect our business and performance, including indirectly through impacts on our customers
7. 21We depend on our management team to implement our business strategy and execute successful operations and we could be harmed by the loss of their services
8. 22We are a community bank and our ability to maintain our reputation is critical to the success of our business. The failure to do so may materially adversely affect our performance
9. 23Our funding sources may prove insufficient to replace deposits at maturity and support our future growth

Risks Related to Laws and Regulations

1. 24Changes in laws and regulations and the cost of regulatory compliance with new laws and regulations may adversely affect our operations and/or increase our costs of operations
2. 25Non-compliance with the USA PATRIOT Act, Bank Secrecy Act, or other laws and regulations could result in fines or sanctions
3. 26Monetary policies and regulations of the Federal Reserve Board could adversely affect our business, financial condition and results of operations
4. 27We are an emerging growth company, and any decision on our part to comply only with certain reduced reporting and disclosure requirements applicable to emerging growth companies could make our common stock less attractive to investors

Risks Related to Economic Conditions

1. 28Inflation can have an adverse impact on our business and on our customers
2. 29We have a high concentration of loans secured by real estate in our market area. Adverse economic conditions, both generally and in our market area, could adversely affect our financial condition and results of operations

Risks Related to Competitive Matters

1. 30Strong competition within our market area may limit our growth and profitability
2. 31The Company’s size makes it more difficult for the Company to compete

Risks Related to Accounting Matters

1. 32Changes in accounting standards could affect reported earnings
2. 33Our net income has relied on mortgage banking revenues, which are highly dependent on macroeconomic factors and United States real estate market, mortgage market and financial market conditions
3. 34The risks of severe weather due to our geographic location could materially affect our financial condition
4. 35Legal and regulatory proceedings and related matters could adversely affect us