United Community Banks (UCB) risk factors, FY2024 10-K

STRATEGIC RISKS

1. 01We may be unable to successfully implement our strategy to grow our banking businesses
2. 02Failure to achieve one or more key elements needed for successful business acquisitions (including the integration of those businesses) could adversely affect our business and earnings
3. 03Failure to achieve one or more key elements needed for successful organic growth could adversely affect our business and earnings
4. 04We are subject to intense competition for clients and the nature of that competition is rapidly evolving
5. 05Failure to keep pace with technological changes could adversely affect our business
6. 06Our traditional approach to customer service, which is highly effective when executed in a physical branch with in-person interactions, may be less effective as customer habits and preferences evolve
7. 07The nature of technology-driven disruption to our industry is changing, in some cases seeking to displace traditional financial service providers rather than merely enhance traditional services or their delivery

OPERATIONAL RISKS

1. 08Fraud is a major, and increasing, operational risk for us and all banks
2. 09Our ability to conduct and grow our businesses depends in part upon our ability to create, maintain, expand, and evolve an appropriate operational and organizational infrastructure, manage expenses, and recruit and retain personnel with the ability to manage a complex business
3. 10A serious information technology security (cybersecurity) breach can cause significant damage and at the same time be difficult to detect even after it occurs
4. 11We rely on information technology and telecommunications systems and certain third-party service providers, the operational functions of which may experience disruptions that could adversely affect us and over which we may have limited or no control
5. 12Our risk management framework may not be effective in mitigating risks and/or losses
6. 13Competition for talent is substantial and increasing. Moreover, revenue growth in some business lines increasingly depends upon top talent
7. 14Our accounting estimates and risk management processes rely on analytical and forecasting models
8. 15Inflationary pressures present a potential threat to our results of operations and financial condition
9. 16Generally, in periods of economic volatility, our realized credit losses increase, demand for our products and services declines, and the credit quality of our loan portfolio declines
10. 17The Federal Reserve has implemented significant economic strategies that have affected interest rates, inflation, asset values, and the shape of the yield curve. These strategies have had, and will continue to have, a significant impact on our business and on many of our clients
11. 18Federal Reserve strategies can, and often are intended to, affect the domestic money supply, inflation, interest rates, and the shape of the yield curve
12. 19We are subject to interest rate risk because a significant portion of our business involves borrowing and lending money, and investing in financial instruments
13. 20High volatility in the yield curve, including sharp movements on and changes in the slope of the curve, can complicate or reduce the efficacy of our balance sheet management practices. Significant changes in the yield curve may reduce our net interest margin and adversely affect our loan and investment portfolios
14. 21Our ability to conduct and grow our businesses, and to obtain and retain clients, is highly dependent upon external perceptions of our business practices and financial stability
15. 22We face the risk that our clients may not repay their loans or other obligations and that the realizable value of collateral may be insufficient to avoid a charge-off
16. 23We are exposed to higher credit and concentration risk from our CRE, commercial and industrial and commercial construction lending
17. 24If our allowance for credit losses is not large enough to cover losses in our loan portfolio, our results of operations and financial condition could be materially and adversely affected

REGULATORY, LEGISLATIVE AND LEGAL RISKS

1. 25We are subject to a challenging regulatory environment that restricts our activities
2. 26Failure to maintain certain regulatory capital levels and ratios could result in regulatory actions that would be materially adverse to our shareholders
3. 27Legal disputes are an unavoidable part of business, and the outcome of pending or threatened litigation cannot be predicted with any certainty
4. 28Data privacy is becoming a major political concern. The laws governing it are new, and are likely to evolve and expand
5. 29Liquidity is essential to our business model and a lack of liquidity, or an increase in the cost of liquidity, could materially impair our ability to fund our operations and jeopardize our results of operation, financial condition and cash flows
6. 30A downgrade of our credit rating could limit our access to borrowings or increase our borrowing costs
7. 31The proportion of our deposit account balances that exceed FDIC insurance limits may expose us to enhanced liquidity risk in times of financial distress
8. 32The preparation of our consolidated financial statements in conformity with U.S. GAAP requires management to make significant assumptions, estimates and judgments that affect the financial statements
9. 33In addition, changes in accounting standards or interpretations could negatively affect our reported earnings and financial condition
10. 34We could be subject to changes in tax laws, regulations and interpretations or challenges to our income tax provision
11. 35Our internal controls and procedures may fail or be circumvented
12. 36We are subject to risks of operating in various jurisdictions
13. 37Natural disasters and weather-related events, exacerbated by climate change, could have a negative impact on our results of operations and financial condition

STOCK HOLDING AND GOVERNANCE RISKS

1. 38The inability of our subsidiaries to declare and pay dividends or other distributions to the Holding Company could adversely affect its liquidity and ability to declare and pay dividends
2. 39Holders of our indebtedness and of depositary shares related to our Series I preferred stock have rights that are senior to those of our common shareholders
3. 40Our stock price can be volatile
4. 41Our corporate organizational documents and the provisions of Georgia law to which we are subject contain certain provisions that could have an anti-takeover effect and may delay, make more difficult or prevent an attempted acquisition of United that you may favor
5. 42Our stockholders may suffer dilution if we raise capital through public or private equity financings to fund our operations, to increase our capital, or to expand