1353523--3/31/2009--Congaree_Bancshares

related topics

{condition, economic, financial}

{stock, price, share}

{loss, insurance, financial}

{loan, real, estate}

{regulation, change, law}

{capital, credit, financial}

{acquisition, growth, future}

{financial, litigation, operation}

{control, financial, internal}

{personnel, key, retain}

{system, service, information}

We expect to incur losses for at least our first three years, and there is a risk we may never become profitable. Our decisions regarding credit risk and reserves for loan losses may materially and adversely affect our business. Lack of seasoning of our loan portfolio may increase the risk of credit defaults in the future. Our real estate portfolios are exposed to weakness in the U.S. housing markets and the overall state of the economy. Changes in interest rates may reduce our profitability. We may have higher loan losses than we have allowed for in our allowance for loan losses. Recent negative developments in the financial industry and the domestic and international credit markets may adversely affect our operations and results. There can be no assurance that recently enacted legislation will help stabilize the U.S. financial system. We could experience an unexpected inability to obtain needed liquidity. Because of our participation in the Treasury Department s Capital Purchase Program, we are subject to several restrictions including restrictions on compensation paid to our executives. Legislation or regulatory changes could cause us to seek to repurchase the preferred stock that we sold to the U.S. Treasury pursuant to the Capital Purchase Program. The securities purchase agreement between us and the Treasury limits our ability to pay dividends on and repurchase our common stock. A prolonged economic downturn, especially one affecting the Lexington and Richland County areas, could reduce our customer base, our level of deposits, and demand for financial products such as loans. We are exposed to changes in the regulation of financial services companies. The FDIC Deposit Insurance assessments that we are required to pay may materially increase in the future, which would have an adverse effect on our earnings and our ability to pay our liabilities as they come due. Our small to medium-sized business target markets may have fewer financial resources to weather a downturn in the economy. We expect that a significant portion of our loan portfolio will be secured by real estate, and events that negatively impact the real estate market could hurt our business. We depend on the accuracy and completeness of information about clients and counterparties and our financial condition could be adversely affected if we rely on misleading information. We are dependent on key individuals and the loss of one or more of these key individuals could curtail our growth and adversely affect our prospects. Efforts to comply with the Sarbanes-Oxley Act will involve significant expenditures, and non-compliance with the Sarbanes-Oxley Act may adversely affect us. We are subject to extensive regulation that could limit or restrict our activities. Our continued operations and future growth may require us to raise additional capital in the future, but that capital may not be available when it is needed. We face strong competition for clients, which could prevent us from obtaining clients and may cause us to pay higher interest rates to attract deposits. We will face risks with respect to future expansion and acquisitions or mergers. There is no public market for our shares, and we do not believe that we have enough shareholders or outstanding shares to support an active trading market, even if we are eventually listed on a recognized trading exchange. We are exposed to the possibility of technology failure.

Full 10-K form ▸

1353523--3/31/2009--Congaree_Bancshares_Inc