Wintrust Financial (WTFC) risk factors, FY2025 10-K

Risks Related to Economic Conditions and Operating Environment

1. 01Deterioration in economic conditions may materially adversely affect the financial services industry and our business, financial condition, results of operations and cash flows
2. 02Since our business is concentrated in the Chicago metropolitan, southern Wisconsin and west Michigan market areas, economic declines in the economy of this region could adversely affect our business
3. 03Climate change manifesting as transition, physical or other risks could adversely affect our operations, businesses, customers, reputation and financial condition

Risks Related to Competition and Reputation

1. 04The financial services industry is very competitive, and if we are not able to compete effectively, we may lose market share and our business could suffer26% rewritten
2. 05Damage to our reputation may harm our business
3. 06Investors’ and other stakeholders’ expectations of our performance relating to environmental, social and governance factors may impose additional costs and expose us to new risks22% rewritten
4. 07Consumers may decide not to use banks to complete their financial transactions, which could adversely affect our business and results of operations22% rewritten
5. 08We may be adversely impacted by the soundness of other financial institutions26% rewritten

Risks Related to Growth and Acquisitions

1. 09If we are unable to continue to identify favorable acquisitions or successfully integrate our acquisitions, our growth may be limited and our results of operations could suffer47% rewritten
2. 10(7)potential changes in banking or tax laws or regulations that may affect the target company
3. 11New lines of business and new products and services are essential to our ability to compete but may subject us to additional risks
4. 12De novo operations often involve significant expenses and delayed returns and may negatively impact Wintrust's profitability

Legal and Regulatory Risks

1. 13If we fail to meet our regulatory capital ratios, we may be forced to raise capital or sell assets
2. 14Changes in the United States’ monetary policy may restrict our ability to conduct our business in a profitable manner32% rewritten
3. 15Legislative and regulatory actions taken now or in the future regarding the financial services industry may significantly increase our costs or limit our ability to conduct our business in a profitable manner63% rewritten
4. 16We are subject to complex and evolving laws, regulations, rules, standards and contractual obligations regarding data privacy and cybersecurity, which could increase the cost of doing business, compliance risks and potential liability
5. 17Financial reform legislation and increased regulatory rigor around consumer protection and mortgage-related issues may reduce our ability to market our products to consumers and may limit our ability to profitably operate our mortgage business
6. 18Federal, state and local consumer lending laws may restrict our ability to originate certain mortgage loans or increase our risk of liability with respect to such loans and could increase our cost of doing business
7. 19Regulatory initiatives regarding bank capital requirements may require heightened capital73% rewritten
8. 20including increased compliance costs. These changes also may require us to invest significant management attention and resources to make any necessary changes to operations in order to comply, and could therefore also materially and adversely affect our business, financial condition and results of operationsNew
9. 21Our FDIC insurance premiums may increase, or the FDIC could adopt additional special assessments, either of which could negatively impact our results of operations24% rewritten
10. 22Non-compliance with the Bank Secrecy Act and its implementing regulations, and other applicable anti-money laundering laws and regulations could result in fines or sanctionsNew
11. 23We are subject to claims and legal actions that could negatively affect our results of operations or financial condition
12. 24We are subject to examinations and challenges by tax authorities that may impact our financial results
13. 25Changes in federal and state tax laws and changes in interpretation of existing laws can impact our financial results
14. 26Changes in accounting policies or accounting standards could materially adversely affect how we report our financial results and financial condition
15. 27Changes in U.S. trade policies, including the imposition of tariffs and retaliatory tariffs, may adversely impact our business, financial condition and results of operations

Risks Related to Lending Operations

1. 28If our allowance for credit losses is not sufficient to absorb losses that may occur in our loan portfolio, our financial condition and liquidity could suffer42% rewritten
2. 29used in calculating our reserves are significantly different from those we actually experience, our financial condition and liquidity could be materially adversely affectedNew
3. 30A significant portion of our loan portfolio is comprised of commercial loans, the repayment of which is largely dependent upon the financial success and economic viability of the borrower
4. 31A substantial portion of our loan portfolio is secured by real estate, in particular commercial real estate. Deterioration in the real estate markets could lead to additional losses, which could have a material adverse effect on our financial condition and results of operations
5. 32Events impacting collateral consisting of real property could lead to additional losses which could have a material adverse effect on our financial condition and results of operations
6. 33Any inaccurate assumptions in our analytical and forecasting models could cause us to miscalculate our projected revenue, capital, liquidity or losses, which could adversely affect our financial condition
7. 34We are subject to environmental liability risk associated with lending activities

Risks Related to Our Niche Businesses

1. 35Our premium finance business may involve a higher risk of delinquency or collection than our other lending operations, and could expose us to losses66% rewritten
2. 36deter, and we cannot assure investors that our risk management procedures and controls will prevent losses from fraudulent activityNew
3. 37Widespread financial difficulties or credit downgrades among commercial and life insurance providers could lessen the value of the collateral securing our premium finance loans and impair the financial condition and liquidity of FIRST Insurance Funding, Wintrust Life Finance and FIFC Canada
4. 38Our wealth management business in general, and Wintrust Investments’ brokerage operation, in particular, exposes us to certain risks associated with the securities industry

Risks Related to Financial Strength and Liquidity

1. 39Changes in prevailing interest rates could adversely affect our net interest income, which is our largest source of income27% rewritten
2. 40Our liquidity position may be negatively impacted if economic conditions do not improve or if they decline
3. 41An actual or perceived reduction in our financial strength may cause others to reduce or cease doing business with us, which could result in a decrease in our net interest income and fee revenues
4. 42Loss of deposits or a change in the deposit mix could increase our funding costs29% rewritten
5. 43As of December 31, 2025, we have been rated by Fitch Ratings as "BBB+", Morningstar DBRS as "A (low)" and Kroll Bond Rating Agency as “A-”. A credit rating is not a recommendation to buy, sell or hold securities and may be subject to revision or withdrawal at any time by the assigning rating organization
6. 44If our growth requires us to raise additional capital, that capital may not be available when it is needed or the cost of that capital may be very high
7. 45The Company's available-for-sale debt and trading securities as well as certain equity securities are carried at fair value
8. 46We are a bank holding company, and our sources of funds, including to pay dividends, are limited

Risks Related to General Operations

1. 47Our controls and procedures may fail or be circumvented
2. 48Our operational or security systems, networks or infrastructure, or those of third parties, could fail or be breached, which could disrupt our business and adversely impact our results of operations, liquidity and financial condition, as well as cause legal or reputational harm25% rewritten
3. 49We face risks from cyber-attacks, information security breaches and other similar incidents that could result in the disclosure of confidential and other information (including personal information), all of which could adversely affect our business or reputation, and create significant legal and financial exposure20% rewritten
4. 50The development and use of artificial intelligence by us or others, or our inability to effectively and timely implement its use, may adversely affect the CompanyNew
5. 51Our business could be adversely affected by fraud
6. 52Our vendors may be responsible for failures that adversely affect our operations
7. 53We depend on the accuracy and completeness of information we receive about our customers and counterparties to make credit decisions
8. 54If we are unable to attract and retain experienced and qualified personnel, our ability to provide high quality service will be diminished, we may lose key customer relationships, and our results of operations may suffer
9. 55Our business could be adversely affected by the occurrence of extraordinary events, such as acts of war, terrorist attacks, natural disasters and public health threats

Risks Related to Ownership of Our Common Stock

1. 56Anti-takeover provisions could negatively impact our shareholders