First Bancorp (FBNC) risk factors, FY2024 10-K

Risks Related to Our Business

1. 01Changes and instability in economic conditions, geopolitical matters and financial markets, including a contraction of economic activity including a possible recession, could adversely impact our business, results of operations and financial condition
2. 02Lending activities involve substantial credit risk
3. 03Our ACL may not be adequate to cover actual losses
4. 04We are subject to interest rate risk, which could negatively impact earnings
5. 05Our financial instruments expose us to certain market risks, including changing interest rates, and may increase the volatility of AOCI and total equity
6. 06Liquidity risk could impair our ability to fund operations and jeopardize our financial condition
7. 07The proportion of our deposit account balances that exceed FDIC insurance limits may expose the Bank to enhanced liquidity risk in times of financial distress
8. 08Cybersecurity incidents or other disruptions of communications or information systems could disrupt business operations, result in the loss of critical and confidential information, and adversely impact our reputation and results of operations
9. 09We rely on certain external vendors
10. 10In the normal course of business, we process large volumes of transactions involving millions of dollars. If our internal controls fail to work as expected, we could experience significant losses
11. 11We are subject to extensive regulation, which could have an adverse effect on our operations
12. 12We might be required to raise additional capital in the future, but that capital may not be available or may not be available on terms acceptable to us when it is needed
13. 13Consumers may decide not to use banks or specifically our Company to complete their financial transactions
14. 14deposits. The loss of these revenue streams and the lower cost of deposits as a source of funds could have a material adverse effect on our financial condition and results of operations
15. 15Negative public opinion regarding our Company and the financial services industry in general, could damage our reputation and adversely impact our earnings
16. 16Failure to keep pace with technological change could adversely affect our business
17. 17New lines of business or new products and services may subject us to additional risk
18. 18Our reported financial results are impacted by management’s selection of accounting methods and certain assumptions and estimates
19. 19Our internal controls may be ineffective
20. 20We may not be able to attract and retain skilled employees, adversely affecting our business
21. 21We may be adversely affected by risks associated with potential and completed acquisitions
22. 22If the goodwill that we recorded in connection with a business acquisition becomes impaired, it could have a significant negative impact on our profitability
23. 23We are subject to losses due to errors, omissions, or fraudulent behavior by our employees, clients, counterparties, or other third parties

Risks Related to Our Common Stock

1. 24An investment in our common stock is not an insured deposit
2. 25Common stock is equity and is subordinate to our existing and future indebtedness and effectively subordinated to all the indebtedness and other non-common equity claims against our subsidiaries
3. 26There can be no assurance that we will continue to pay cash dividends
4. 27Future sales of our stock by our shareholders or the perception that those sales could occur may cause our stock price to decline
5. 28We may issue additional shares of stock or equity derivative securities that will dilute the percentage ownership interest of existing shareholders and may dilute the book value per share of our common stock and adversely affect the terms on which we may obtain additional capital
6. 29We may make future acquisitions, which could dilute current shareholders’ stock ownership and expose us to additional risks
7. 30shares of common stock or other securities and/or to use a substantial amount of cash, other liquid assets, and/or incur debt