315709--3/1/2010--INTERNATIONAL_BANCSHARES

related topics

{stock, price, share}

{loan, real, estate}

{acquisition, growth, future}

{financial, litigation, operation}

{personnel, key, retain}

{competitive, industry, competition}

{loss, insurance, financial}

{condition, economic, financial}

{regulation, change, law}

{operation, natural, condition}

{tax, income, asset}

{system, service, information}

{product, market, service}

{cost, operation, labor}

Risks Related to the Company's Business Losses from loan defaults may exceed the allowance the Company establishes for that purpose, which could have an adverse effect on the Company's business. If real estate values in the Company's target markets decline, the loan portfolio would be impaired. The Company Is Subject To Environmental Liability Risk Associate With Lending Activities. The Company's subsidiary banks face strong competition in their market areas, which may limit their asset growth and profitability. The Company relies, in part, on external financing to fund the Company's operations and the unavailability of such funds in the future could adversely impact the Company's growth strategy and prospects. The Company's business is subject to interest rate risk and variations in interest rates may negatively affect the Company's financial performance. The Company is subject to extensive regulation which could adversely affect the Company including changes in U.S. Mexico trade and travel along the Texas border. The effects of the proceedings pending with the Internal Revenue Service regarding the Company's lease financing transactions could adversely affect the Company. The Company's potential future acquisitions could be adversely affected by a number of factors. The Company relies heavily on its chief executive officer. System failure or breaches of our network security could subject us to increased operating costs as well as litigation and other liabilities. The Company may desire or need to raise additional capital in the future, and such capital may not be available when needed or at all. Severe weather, natural disasters, acts of war or terrorism and other external events could significantly impact the Company's business. An impairment in the carrying value of our goodwill could negatively impact our earnings and capital. Risks Related to the Company's Industry Changes in economic and political conditions could adversely affect the Company's earnings, as our borrowers' ability to repay loans and the value of the collateral securing our loans decline. The Company depends on the accuracy and completeness of information about customers and counterparties. If the Company does not adjust to rapid changes in the financial services industry, its financial performance may suffer. Risks Related to the Company's Stock The Company's stock price may be volatile. The holders of our junior subordinated debentures have rights that are senior to those of our shareholders. Risks Related to Participation in the CPP We may be adversely affected by our participation in the CPP. You may not receive dividends on the common stock. We may experience increases in the cost of compensation programs We may lose members of our management team due to compensation restrictions.

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315709--3/1/2010--INTERNATIONAL_BANCSHARES_CORP