1304366--3/14/2008--Community

related topics

{operation, natural, condition}

{acquisition, growth, future}

{personnel, key, retain}

{condition, economic, financial}

{tax, income, asset}

{loss, insurance, financial}

{loan, real, estate}

{competitive, industry, competition}

{provision, law, control}

{capital, credit, financial}

{stock, price, share}

{regulation, change, law}

The current changing economic environment poses significant challenges for the Company. The Las Vegas market area is substantially dependent on gaming and tourism revenue, and a decrease in gaming or tourism could seriously hurt the Company s business and prospects. An expansion of permissible gaming activities in other states, particularly in California, may lead to a decline in gaming revenue in Las Vegas, which could hurt the Company s business and prospects. A terrorist act, or the mere threat of a terrorist act, may adversely affect the Las Vegas economy and may cause substantial harm to the Company s business. The Company has a high concentration of loans secured by real estate and further deterioration in the real estate market, for any reason, could hurt its business and prospects. Factors Relating to the Company s Business The Company s future success involves both its ability to grow and manage such growth. Management must also continue to manage the risks inherent in the banking business. The Company may not be able to sustain its historical growth rates, be able to grow at all, or successfully manage any growth, whether or not the greater Las Vegas or Phoenix area economies continue to grow. This could result in a variety of adverse consequences to the Company, including the following: The Company may not be able to continue its historical growth rate. A component of the Company s business strategy is to expand into high growth markets by opening new branches or organizing new banks and/or acquiring other financial institutions. Management may not be able to successfully implement this part of the Company s business strategy, and therefore its market value and profitability may suffer. The Company s growth could be hindered unless it is able to recruit additional qualified employees. The Company s business would be harmed if it lost the services of any of its key executives. There is intense competition in the Company s market areas and management cannot assure you that it will be able to successfully compete. The Company s allowance for loan losses may not be adequate to cover actual losses, particularly given the relatively large individual loan size. The Company s future earnings could be negatively impacted if an impairment of goodwill is recognized. Provisions in the Company s articles of incorporation and bylaws may limit the ability of another party to acquire the Company. The Company is subject to interest rate risk. The Company cost of funds could increase if wholesale core deposits are unavailable. The Company is subject to extensive government regulation. These regulations could adversely affect the Company s business, financial condition, results of operations or cash flows. The Company s Stock Trades Less Frequently Than Others.

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1304366--3/14/2008--Community_Bancorp