Home Bancshares (HOMB) risk factors, FY2025 10-K

Risks Related to Our Industry

1. 01We are subject to extensive regulation that could limit or restrict our activities and impose financial requirements or limitations on the conduct of our business, and changes in the laws and regulations to which we are subject could adversely affect our profitability
2. 02We are subject to heightened regulatory requirements as our total assets exceed $10 billion
3. 03Difficult market and economic conditions may adversely affect our industry and our business
4. 04Our FDIC insurance premiums and assessments could increase and result in higher noninterest expense
5. 05Our profitability is vulnerable to interest rate fluctuations and monetary policy and could be adversely affected by any future actions taken by the Federal Reserve Board to address inflation or other economic developments
6. 06The failure of other financial institutions could adversely affect us, and we may incur losses on investments in other financial institutions
7. 07The impacts of public health crises, including national or international pandemics, could materially and adversely affect our business, financial condition and results of operations46% rewritten

Risks Related to Our Business

1. 08Our decisions regarding credit risk could be inaccurate and our allowance for credit losses may be inadequate, which would materially and adversely affect us40% rewritten
2. 09Our high concentration of real estate loans and especially commercial real estate loans exposes us to increased lending risk23% rewritten
3. 10Our geographic concentration of banking activities and loan portfolio makes us more vulnerable to adverse conditions in our local markets23% rewritten
4. 11If the value of real estate were to deteriorate, a significant portion of our loans could become under-collateralized, which could have a material adverse effect on us
5. 12Because we have a concentration of exposure to a number of individual borrowers, a significant loss on any of those loans could materially and adversely affect us31% rewritten
6. 13Our cost of funds may increase as a result of general economic conditions, interest rates and competitive pressures
7. 14The loss of key employees may materially and adversely affect us41% rewritten
8. 15The value of securities in our investment portfolio may decline in the future
9. 16Our recent results do not indicate our future results and may not provide guidance to assess the risk of an investment in our common stock
10. 17We may not be able to raise the additional capital we need to grow and, as a result, our ability to expand our operations could be materially impaired
11. 18Our growth and expansion strategy may not be successful, and our market value and profitability may suffer
12. 19If we acquire additional banks or bank assets in the future, there may be undiscovered risks or losses associated with such acquisitions which would have a negative impact upon our future income
13. 20If the goodwill that we may record or have recorded in connection with a business acquisition becomes impaired, it could require charges to earnings
14. 21Competition from other financial institutions and financial service providers may adversely affect our profitability
15. 22We continually encounter technological change, and we may not be able to keep pace with rapid technological change in the financial services industryNew
16. 23We may incur losses as a result of unforeseen or catastrophic events, including extreme weather events or other natural disasters
17. 24We may incur environmental liabilities with respect to properties to which we take title
18. 25Our operations could be interrupted if certain external vendors on which we rely experience difficulty, terminate their services or fail to comply with banking laws and regulations
19. 26Our earnings could be adversely impacted by incidences of fraud and compliance failure

Risks Related to the Proposed Acquisition of Mountain Commerce Bancorp, Inc

1. 27We may fail to realize all of the anticipated benefits of the mergerNew
2. 28The success of the merger of MCBI with and into us will depend, in part, on our ability to successfully combine our and MCBI’s organizations. If we are not able to achieve this objective, the anticipated benefits of the merger may not be realized fully or at all or may take longer than expected to be realizedNew
3. 29The completion of the merger is subject to the consent and approval of various governmental authorities, which may impose conditions that could have an adverse effect on the combined company following the mergerNew
4. 30The combined company expects to incur substantial expenses related to the mergerNew

Risks Related to Owning Our Stock

1. 31The rights of our common shareholders are subordinate to the holders of any debt securities that we may issue from time to time and may be subordinate to the holders of any series of preferred stock that may issue in the future
2. 32We may be unable to, or choose not to, pay dividends on our common stock