Finward Bancorp (FNWD) risk factors, FY2025 10-K

Finward Bancorp's FY2025 10-K, filed Mar 25, 2026, lists 34 risk factors in 3 groups. Against the prior year's 39: 3 new, 8 dropped, 7 substantially reworded.

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Risk factors listed
343 groups
New this year
3vs 39 last year
Dropped
8since the prior 10-K
Substantially reworded
7of those kept
Section length
8k wordsItem 1A

What the changes say

  • Finward Bancorp faces heightened regulatory oversight and emerging deposit competition from alternative fintech platforms and digital assets like stablecoins.
  • The bank updated its portfolio metrics, showing commercial real estate loans at $555.6 million and fixed-rate loans at $636.9 million.

What changed since the prior 10-K

New

  • NewRisks Related to Our Business

    investors. Our ability to remain eligible may also depend on having an acceptable peer-relative delinquency ratio for the FHA and maintaining a delinquency rate with respect to Ginnie Mae pools that are below Ginnie Mae guidelines

    Agency loan program eligibility could be impaired if FHA delinquency ratios or Ginnie Mae pool delinquency rates exceed thresholds.

  • NewRisks Related to the Banking Industry

    Due to the development of new technologies and regulatory actions encouraging the use of these technologies, consumers may decide not to use banks to complete their financial transactions

    Alternative financial technologies, brokerage accounts, and stablecoins enabled by the GENIUS Act may draw deposits away from the Bank.

  • NewRisks Related to the Banking Industry

    The use of, or inability to use, artificial intelligence by us, our customers, and our shareholders presents risks and challenges that may adversely impact our business and operating results or the business and operating results of our customers and vendors

    Using generative AI creates risks of operational errors, bias, intellectual property infringement, and automated cyberattacks from threat actors.

Dropped

  • DroppedRisks Related to Our Business

    Potential acquisitions may disrupt our business and dilute stockholder value

  • DroppedRisks Related to Our Business

    potential problems in integrating the target company’s data processing and ancillary systems, customers, and employees with ours

  • DroppedRisks Related to Our Business

    Regulatory changes to diversity, equity, and inclusion (“DEI”) and environmental, social, and governance (“ESG”) practices may adversely impact our reputation, compliance costs, and business operations

  • DroppedRisks Related to the Banking Industry

    There could be an increase in write-downs of asset values by financial institutions, such as the Bank

  • DroppedRisks Related to the Banking Industry

    Our ability to assess the creditworthiness of customers could be impaired if the models and approaches they use to select, manage, and underwrite credits become less predictive of future performance

  • DroppedRisks Related to the Banking Industry

    The Bank could be required to pay significantly higher FDIC premiums in the future if losses further deplete the Deposit Insurance Fund

  • DroppedRisks Related to the Banking Industry

    Acquisitions and the addition of branch facilities may not produce revenue enhancements or cost savings at levels or within timeframes originally anticipated and may result in unforeseen integration difficulties and dilution to existing shareholder value

  • DroppedRisks Related to the Company’s Common Stock

    economic, financial, geopolitical, regulatory, congressional, or judicial events that affect us or the financial markets

Reworded

  • 80% rewrittenRisks Related to Our Business

    The Company and Bank are subject to extensive regulation and oversight, including with respect to the MOU

    Updated to reflect that the Bank entered into a Memorandum of Understanding (MOU) with the FDIC and DFI on August 9, 2024, replacing the prior Consent Order related to BSA compliance.

    Was: The Company and Bank are subject to extensive regulation and oversight, including with respect to the Order and MOU

  • 47% rewrittenRisks Related to the Banking Industry

    Our business may be adversely affected by conditions in the financial markets and economic conditions generally

    Retained the description of the geographic market concentration across eight counties in Indiana and Illinois without substantive changes to the economic environment description.

  • 44% rewrittenRisks Related to Our Business

    Unrealized losses in the Company’s investment portfolio could affect liquidity

    Added mortgage-backed securities to the listed components of the Company's available-for-sale investment portfolio.

  • 34% rewrittenRisks Related to Our Business

    Our mortgage lending profitability could be significantly reduced if we are not able to resell mortgages at a reasonable gain on sale or experience other problems with the secondary market process or we are unable to retain our mortgage loan sales force due to regulatory changes

    Removed explicit references to Fannie Mae and Freddie Mac, generalizing them as the Agencies.

  • 33% rewrittenRisks Related to Our Business

    Commercial real estate lending may expose the Company to increased lending risks

    Updated the commercial real estate portfolio figure as of December 31, 2025, to $555.6 million, or 38.3% of total loans, compared to $551.7 million, or 36.6%, previously.

  • 29% rewrittenRisks Related to the Company’s Common Stock

    The price of our common stock may fluctuate, sometimes significantly, and this may make it difficult for you to resell our common stock at times or at prices you find attractive

    Formatted factors impacting common stock price fluctuations into bullet points for readability.

  • 21% rewrittenRisks Related to Our Business

    Above average interest rate risk associated with fixed-rate loans may have an adverse effect on our financial position or results of operations

    Updated the fixed-rate loan portfolio figure as of December 31, 2025, to $636.9 million, or 44.0% of total loans, down from $712.7 million, or 47.3%.

All 34 risk factors

Headings as the filing states them, in filing order.

Risks Related to Our Business

  1. 01As a financial institution, the Company is subject to a number of risks relating to its daily business
  2. 02Compliance Risk – the risk of additional action by our regulators or additional regulation that could hinder our ability to do business profitably
  3. 03The Company is subject to liquidity risk in its operations, which could adversely affect the ability to fund various obligations
  4. 04Unrealized losses in the Company’s investment portfolio could affect liquidity44% rewritten
  5. 05Above average interest rate risk associated with fixed-rate loans may have an adverse effect on our financial position or results of operations21% rewritten
  6. 06Higher loan losses could require the Company to increase its allowance for credit losses through a charge to earnings
  7. 07Commercial business lending may expose the Company to increased lending risks
  8. 08Commercial real estate lending may expose the Company to increased lending risks33% rewritten
  9. 09Our mortgage lending profitability could be significantly reduced if we are not able to resell mortgages at a reasonable gain on sale or experience other problems with the secondary market process or we are unable to retain our mortgage loan sales force due to regulatory changes34% rewritten
  10. 10investors. Our ability to remain eligible may also depend on having an acceptable peer-relative delinquency ratio for the FHA and maintaining a delinquency rate with respect to Ginnie Mae pools that are below Ginnie Mae guidelinesNew
  11. 11Our mortgage lending profitability could be significantly reduced as changes in interest rates could affect mortgage origination volume and pricing for selling mortgages on the secondary market
  12. 12Our information systems may experience an interruption or breach in security
  13. 13We are subject to certain operational risks, including, but not limited to, customer or employee fraud and data processing system failures and errors
  14. 14We depend on outside third parties for processing and handling of our records and data
  15. 15We continually encounter technological change
  16. 16We may not be able to attract and retain skilled people
  17. 17Loss of key employees may disrupt relationships with certain customers
  18. 18We may need to raise additional capital in the future, and such capital may not be available when needed or at all
  19. 19We may be exposed to risk of environmental liabilities with respect to real property to which we take title
  20. 20We are exposed to intangible asset risk in that our goodwill may become impaired
  21. 21Damage to our reputation could damage our business
  22. 22The Company and Bank are subject to extensive regulation and oversight, including with respect to the MOU80% rewritten

Risks Related to the Banking Industry

  1. 23Our business may be adversely affected by conditions in the financial markets and economic conditions generally47% rewritten
  2. 24We face strong competition in all phases of our business from other banks, financial institutions, and non-banks
  3. 25Due to the development of new technologies and regulatory actions encouraging the use of these technologies, consumers may decide not to use banks to complete their financial transactionsNew
  4. 26We are subject to federal regulations that seek to protect the Deposit Insurance Fund and the depositors and borrowers of the Bank, and our federal regulators may impose restrictions on our operations that are detrimental to holders of the Company’s common stock
  5. 27The soundness of other financial institutions could adversely affect us
  6. 28The use of, or inability to use, artificial intelligence by us, our customers, and our shareholders presents risks and challenges that may adversely impact our business and operating results or the business and operating results of our customers and vendorsNew

Risks Related to the Company’s Common Stock

  1. 29An investment in the Company’s common stock is not an insured deposit
  2. 30The price of our common stock may fluctuate, sometimes significantly, and this may make it difficult for you to resell our common stock at times or at prices you find attractive29% rewritten
  3. 31The trading volume in the Company’s common stock is less than that of other larger financial institutions
  4. 32The Company’s Articles of Incorporation, Indiana law, and certain banking laws may have an anti-takeover effect
  5. 33The Company may issue additional securities, which could dilute the ownership percentage of holders of the Company’s common stock
  6. 34We may not be able to pay dividends in the future in accordance with past practice

Other Finward Bancorp 10-Ks

  • FY2024 10-K risk factors
    39 risks

    Finward Bancorp faces concentrated geographic and lending risks in Indiana and Illinois markets. Regulatory oversight and compliance under a Consent Order dominate operations. Fixed-rate loans and investment portfolio unrealized losses strain liquidity and capital.

    Filed Mar 31, 2025

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.