1003961--9/28/2010--PATAPSCO_BANCORP

related topics

{loan, real, estate}

{loss, insurance, financial}

{stock, price, share}

{condition, economic, financial}

{personnel, key, retain}

{competitive, industry, competition}

{regulation, change, law}

A continuation of recent turmoil in the financial markets could have an adverse effect on our financial position or results of operations. Changes in interest rates may hurt our earnings. Recently enacted regulatory reform legislation may have a material impact on our operations. Our emphasis on multi-family and commercial lending may expose us to increased lending risks. Our level of nonperforming loans expose us to increased lending risks. Further, our allowance for loan losses may prove to be insufficient to absorb losses in our loan portfolio. The Bank may be forced to accept administrative decisions with respect to certain participation loans that might not be in the Bank s best interests and that could cause it to experience losses with respect to such loans that might be larger than it might otherwise incur on a similar portfolio of distressed loans where it was the lead lender. A downturn in the local economy or a decline in real estate values could hurt our profits. Strong competition within our market area could hurt our profits and slow growth. The limitations on executive compensation imposed through our participation in the TARP Capital Purchase Program may restrict our ability to attract, retain and motivate key employees, which could adversely affect our operations. Future dividend payments and common stock repurchases are restricted by the terms of the U.S. Treasury s equity investment in us. The terms governing the issuance of the preferred stock to the U.S. Treasury may be changed, the effect of which may have an adverse effect on our operations.

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1003961--9/28/2010--PATAPSCO_BANCORP_INC