Community Financial (TCFC)

Risks

• The ongoing COVID-19 pandemic and measures taken to limit its spread could adversely affect our business, financial condition, and results of operations.
• Increased credit risk resultant of the COVID-19 pandemic could adversely impact our profitability.
• Interest rate volatility stemming from COVID-19 could negatively affect our net interest income, lending activities, deposits and profitability.
• We may experience losses, additional expense and reputational harm arising out of our origination of PPP loans.
• Our increased emphasis on commercial lending may expose us to increased credit risks.
• Imposition of limits by the bank regulators on commercial real estate lending activities could curtail the Company’s growth and adversely affect its earnings.
• We may be required to make further increases in our provision for loan losses and to charge-off additional loans in the future. Further, our allowance for loan losses may prove to be insufficient to absorb losses in our loan portfolio.
• We may experience increased levels of non-performing loans, charge-offs and delinquencies, which would require additional increases in our provision for loan losses.
• Non-performing and classified assets could take significant time to resolve and adversely affect our results of operations and financial condition and could result in further losses in the future.
• Our residential mortgage loans and home equity loans expose us to a risk of loss due to declining real estate values.
• Any delays in our ability to foreclose on delinquent mortgage loans may negatively impact our business.
• Our asset valuation methodologies, estimations and assumptions may be subject to differing interpretations and could result in changes to asset valuations that materially adversely affect our results of operations or financial condition.
• We may be adversely affected by economic conditions in our market area, which is significantly dependent on federal government and military employment and programs.
• Changes in interest rates could reduce our net interest income and earnings.
• Changes to and replacement of the London InterBank Offered Rate ("LIBOR") Benchmark Interest Rate may adversely affect our business, financial condition, and results of operations.
• We are subject to liquidity risks.
• Our deposit concentrations may subject us to additional liquidity and pricing risk.
• The Company is a bank holding company and its sources of funds necessary to meet its obligations are limited.
• Security breaches and other disruptions could compromise our information and expose us to liability, which would cause our business and reputation to suffer.
• Failure to maintain effective internal control over financial reporting could have a material adverse effect on our business and stock price.
• Our internal control systems are inherently limited.
• We rely on other companies to provide key components of our business infrastructure.
• We depend on information technology and telecommunications systems and third-party servicers, and systems failures, interruptions or breaches of security could have a material adverse effect on us.
• The high volume of transactions we process exposes us to significant operational risks.
• If our information technology is unable to keep pace with industry developments, our business and results of operations may be adversely affected.
• Our enterprise risk management framework may not be effective in mitigating the risks to which we are subject, based upon the size, scope, and complexity of the Company.
• The adoption of flexible work from home arrangements poses a number of operational risks that could adversely affect our business, financial condition and results of operations.
• Changes in accounting standards or interpretation of new or existing standards may affect how the Company report its financial condition and results of operations.
• The implementation of the Current Expected Credit Loss accounting standard could require us to increase our allowance for loan losses and may have a material adverse effect on financial condition and results of operations.
• We may be adversely affected by changes in U.S. tax laws and regulations.
• Impairment in the carrying value of goodwill and other intangible assets could negatively impact our financial condition and results of operations.
• Our accounting estimates, and risk management processes rely on analytical and forecasting models.
• We operate in a highly regulated environment and we may be adversely affected by changes in laws and regulations.
• We are subject to periodic examination and scrutiny by a number of banking agencies and, depending upon the findings and determinations of these agencies, we may be required to make adjustments to our business that could adversely affect us.
• Our ability to pay dividends is limited by law.
• Monetary policies and regulations of the Federal Reserve could adversely affect our business, financial condition and results of operations.
• We face a risk of noncompliance and enforcement action with the Bank Secrecy Act and other anti-money laundering statutes and regulations.
• We are subject to numerous laws designed to protect consumers, including the Community Reinvestment Act (“CRA”) and fair lending laws, and failure to comply with these laws could lead to a wide variety of sanctions.
• The market price and liquidity of our common stock could be adversely affected if the economy were to weaken or the capital markets were to experience volatility.
• We may issue additional common stock or other securities in the future which could dilute the ownership interest of existing shareholders or impact shareholder returns.
• Our financial condition and results of operations could be negatively affected if we fail to timely and effectively execute or manage our strategic plan, particularly if we grow through acquisitions of other financial institutions.
• Combining acquired businesses may be more difficult, costly or time consuming than expected and the anticipated benefits and cost savings of acquisitions may not be realized.
• Provisions of our articles of incorporation, bylaws and Maryland law, as well as state and federal banking regulations, could delay or prevent a takeover of us by a third party.
• Strong competition within our market area could hurt our profits and slow growth.
• We are a community bank and our ability to maintain our reputation is critical to the success of our business and the failure to do so may materially adversely affect our performance.
• Changes in U.S. or regional economic conditions could have an adverse effect on the Company’s business, financial condition and results of operations.
• Increasing scrutiny and evolving expectations from customers, regulators, investors, and other stakeholders with respect to our environmental, social and governance practices may impose additional costs on us or expose us to new or additional risks.