First Internet Bancorp (INBK) risk factors, FY2024 10-K

Business, Strategic, and Reputational Risks

1. 01A failure of, or interruption in, the communications and information systems on which we rely to conduct our business could adversely affect our revenues and profitability
2. 02Economic conditions have affected and could continue to adversely affect our revenues and profits
3. 03The competitive nature of the banking and financial services industry could negatively affect our ability to increase or maintain our market share and retain long-term profitability
4. 04Negative developments in the banking industry could adversely affect our current and future business operations and financial condition
5. 05Reputational risk and social factors may negatively affect us
6. 06Societal, legislative and regulatory responses to environmental, social and governance (ESG) concerns, and anti ESG concerns, as well as diversity, equity, and inclusion (DEI) and anti-DEI concerns, could adversely affect our business and performance, including indirectly through impacts on our customers
7. 07New lines of business, and new products and services, may result in exposure to new risks; and the value and earnings related to existing lines of business are subject to market conditions
8. 08Significant external events, including continued spread or outbreak of a highly contagious disease, could adversely affect our business and results of operations
9. 09Anti-takeover provisions could negatively impact our shareholders
10. 10Our commercial loan portfolio exposes us to higher credit risks than residential real estate loans, including risks relating to the success of the underlying business and conditions in the market or the economy and concentrations in our commercial loan portfolio
11. 11Portions of our commercial lending activities are geographically concentrated in Central Indiana and adjacent markets, and changes in local economic conditions may impact their performance
12. 12We are subject to risks arising from conditions in the real estate market, as a significant portion of our loans are secured by real estate
13. 13If our allowance for credit losses is not sufficient to cover actual credit losses, our earnings could decrease

Market, Interest Rate, and Liquidity Risks

1. 14The market value of some of our investments could decline and adversely affect our financial position
2. 15Changes in interest rates could adversely affect the Company’s results of operations and financial condition
3. 16The Bank may not be able to pay us dividends
4. 17We may need additional funding resources in the future, and these funding resources may not be available when needed or at all, without which our financial condition, results of operations and prospects could be materially impaired
5. 18The Company’s stock price can be volatile

Operational Risks

1. 19Because our business is highly dependent on technology that is subject to rapid change and transformation, we are subject to risks of obsolescence
2. 20We rely on our management team and could be adversely affected by the unexpected loss of key officers
3. 21Our business may be adversely affected by fraud

Legal and Regulatory Risks

1. 22We operate in a highly regulated environment, which could restrain our growth and profitability
2. 23Federal and state regulators periodically examine our business and we may be required to remediate adverse examination findings
3. 24Our FDIC deposit insurance premiums and assessments may increase, which would reduce our profitability
4. 25We are subject to numerous laws designed to protect consumers, including the CRA and fair lending laws, and failure to comply with these laws could lead to a wide variety of sanctions
5. 26We are subject to evolving and expensive regulations and requirements. Our failure to adhere to these requirements or the failure or circumvention of our controls and procedures could seriously harm our business
6. 27We face risk under the BSA and other anti-money laundering statutes and regulations, as well as general fund transfer and payments-related risk
7. 28We may be subject to potential liability and business risk from actions by our regulators related to supervision of third parties
8. 29Federal banking laws limit the acquisition, ownership and repurchase of our common stock
9. 30Changes in accounting policies or in accounting standards could materially affect how we report our financial condition and results of operations
10. 31Shares of our common stock are not insured deposits and may lose value
11. 32The costs and effects of litigation, investigations or similar matters involving us or other financial institutions or counterparties, or related adverse facts and developments, could materially affect our business, operating results and financial condition