Washington Trust Bancorp (WASH) risk factors, FY2025 10-K

RISKS RELATED TO OUR BUSINESS AND INDUSTRY

1. 01Fluctuations in interest rates may impair the Bank’s business
2. 02We may be adversely affected by volatility in U.S. and global economic conditions and changes in fiscal, monetary, trade and regulatory policies
3. 03Inflation can have an adverse impact on our business and on our customersNew
4. 04Changes in U.S. trade policies, including the imposition of tariffs and retaliatory tariffs, may adversely affect our business, financial condition, and results of operationsNew
5. 05Changes in the business and economic conditions in southern New England could adversely affect our financial condition and results of operations
6. 06Increased market volatility and adverse changes in financial or capital market conditions may increase our market risk
7. 07If we are unable to access the capital markets, have prolonged net deposit outflows, or our borrowing costs increase, our liquidity and competitive position will be negatively affected
8. 08Our cost of funds for banking operations may increase as a result of general economic conditions, interest rates and competitive pressures
9. 09Our loan portfolio includes commercial loans, which are generally riskier than other types of loans
10. 10A portion of our commercial loan portfolio consists of loan participations, which may have a higher risk of loss than loans we originate because we are not the lead lender and we have limited control over credit monitoringNew
11. 11We may experience losses and expenses if security interests granted for loans are not enforceable
12. 12Environmental liability associated with our lending activities could result in losses
13. 13We are subject to a variety of risks in connection with any sale of loans we may conduct, which could adversely affect our results of operations and financial conditionNew
14. 14If our allowance for credit losses is not sufficient to cover actual loan losses, our earnings may decreaseNew
15. 15We are a holding company and depend on the Bank for dividends, distributions, and other payments47% rewritten
16. 16We cannot guarantee that our allocation of capital to various alternatives, including share repurchase programs, will enhance long-term shareholder valueNew
17. 17We have credit and market risk inherent in our investment securities portfolio
18. 18Potential downgrades of U.S. government agency and government-sponsored enterprise securities by one or more of the credit ratings agencies could have a material adverse effect on our operations, earnings and financial condition
19. 19The soundness of other financial institutions could adversely affect us
20. 20Revenues from mortgage banking activities are largely dependent on mortgage origination volume and sales volume. Changes in interest rates and the condition of housing markets could adversely impact the volume of residential mortgage originations, sales and related mortgage banking activities
21. 21We face continuing security risks to our data, including the information we maintain relating to our customers72% rewritten
22. 22We rely on other companies to provide key components of our business infrastructure
23. 23We may not be able to successfully implement future information technology system enhancements, which could adversely affect our business operations and profitability
24. 24We may incur significant losses as a result of ineffective risk management processes and strategies
25. 25Damage to our reputation could significantly harm our business, including our competitive position and business prospects
26. 26We may not be able to compete effectively64% rewritten
27. 27We may be unable to attract and retain key personnel
28. 28Natural disasters, acts of terrorism, future pandemics and other external events could harm our business
29. 29Climate change and related legislative and regulatory initiatives may result in operational changes and expenditures that could significantly impact our business
30. 30If we are required to write-down goodwill or other intangible assets recorded in connection with our acquisitions, our profitability would be negatively impacted
31. 31Our financial statements are based in part on assumptions and estimates, which, if wrong, could cause unexpected losses in the futureNew
32. 32Changes in accounting standards can materially impact our financial statements
33. 33Changes in tax laws and regulations, differences in interpretation of tax laws and regulations, and reductions in the value of our deferred tax assets may adversely impact our financial statements
34. 34The market price and trading volume of our stock can be volatile
35. 35We may need to raise additional capital in the future and such capital may not be available when needed
36. 36Certain provisions of our articles of incorporation may have an anti-takeover effect

RISKS RELATED TO OUR REGULATORY ENVIRONMENT

1. 37We operate in a highly regulated industry, and laws and regulations, or changes in them, could limit or restrict our activities and could have a material adverse effect on our operations26% rewritten
2. 38Our wealth management business is highly regulated, and the regulators have the ability to limit or restrict our activities and impose fines or suspensions on the conduct of our business
3. 39We 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
4. 40We may become subject to enforcement actions even though noncompliance was inadvertent or unintentional44% rewritten
5. 41We face significant legal risks, both from regulatory investigations and proceedings, and from private actions brought against us