1175029--3/30/2009--NORTH_STATE

related topics

{stock, price, share}

{condition, economic, financial}

{loss, insurance, financial}

{regulation, change, law}

{acquisition, growth, future}

{capital, credit, financial}

{personnel, key, retain}

{loan, real, estate}

{system, service, information}

{cost, operation, labor}

{provision, law, control}

{competitive, industry, competition}

Risks Related to Our Business Our Business May Be Adversely Affected by Conditions in the Financial Markets and Economic Conditions Generally The FDIC Deposit Insurance assessments that we are required to pay will increase, possibly materially, in the future, which would have an adverse affect on our earnings. The effects of the U.S. government s plans to stabilize the financial system and the economy are unknown at this time. Our profitability depends significantly on economic conditions in our market areas. The lack of seasoning of our loan portfolio makes it difficult to assess the adequacy of our loan loss reserves accurately. We make and hold in our loan portfolio a significant number of commercial real estate loans, including construction and development loans, which pose more credit and regulatory risk than other types of loans typically made by financial institutions. If we experience greater loan losses than anticipated, it would have an adverse effect on our net income. Liquidity is essential to our business and we rely, in part, on external sources to finance a significant portion of our operations. We may not be able to maintain and manage our growth, which may adversely affect our results of operations and financial condition and the value of our common stock. Interest rate volatility could significantly harm our business. We rely heavily on the services of key personnel. Our ability to retain and attract qualified employees is critical to the success of our business and the failure to do so may materially adversely affect our performance. New or acquired bank office facilities and other facilities may not be profitable. We are subject to operational risk and an operational failure could materially adversely affect our businesses. In order to be profitable, we must compete successfully with other financial institutions which have greater resources and capabilities than we do. We are subject to extensive regulation that could limit or restrict our activities. Our growth may require us to raise additional capital that may not be available when it is needed, or at all. Declines in value in investment securities held by us could require write-downs, which would reduce our earnings. We are subject to security and operational risks relating to use of our technology that could damage our reputation and business. Changes in the federal or state tax laws may negatively impact our financial performance. Volatile and illiquid financial markets resulting from a significant event in the market may hinder our ability to increase or maintain our current liquidity position. Changes in accounting standards or interpretation of new or existing standards could materially affect our financial results. Risks Related to Owning Our Common Stock We have implemented anti-takeover devices that could make it more difficult for another company to acquire us, even though such an acquisition may increase shareholder value. Our common stock is quoted on the Over-the-Counter Bulletin Board and is not quoted on a stock exchange, the trading volume is low and the sale of a substantial amount of our common stock in the public market could depress the price of our common stock. We have never paid cash dividends and may not ever pay cash dividends. Our securities are not FDIC insured. The holders of our junior subordinated debentures have rights that are senior to those of our common shareholders.

Full 10-K form ▸

1175029--3/30/2009--NORTH_STATE_BANCORP