354869--2/25/2010--FIRSTMERIT_CORP

related topics

{loss, insurance, financial}

{acquisition, growth, future}

{regulation, change, law}

{condition, economic, financial}

{loan, real, estate}

{tax, income, asset}

{financial, litigation, operation}

{system, service, information}

{competitive, industry, competition}

{stock, price, share}

{personnel, key, retain}

{capital, credit, financial}

{property, intellectual, protect}

The enactment of new legislation and increased regulatory oversight may significantly affect our financial condition. Changes in economic and political conditions, particularly in Ohio, could adversely affect our earnings, cash flows and capital, as our borrowers ability to repay loans and the value of the collateral securing our loans decline. Increases in FDIC insurance premiums may have a material adverse affect on our earnings. The strength and stability of other financial institutions may adversely affect our business. Current levels of market volatility are unprecedented. Changes in interest rates could have a material adverse effect on our financial condition and results of operations. Our earnings are significantly affected by the fiscal and monetary policies of the federal government and its agencies. The primary source of our income from which we pay dividends is the receipt of dividends from FirstMerit Bank, which is subject to regulatory restrictions on its payment of dividends. If our actual loan losses exceed our allowance for credit losses, our net income will decrease. We extend credit to a variety of customers based on internally set standards and the judgment of our loan officers and bank presidents. Our credit standards and on-going process of credit assessment might not protect us from significant credit losses. We depend upon the accuracy and completeness of information about customers and counterparties. Derivative transactions may expose us to unexpected risk and potential losses. We are subject to examinations and challenges by tax authorities. Environmental liability associated with commercial lending could have a material adverse effect on our business, financial condition and results of operations. Our business strategy includes significant growth plans. Our financial condition and results of operations could be negatively affected if we fail to grow or fail to manage our growth effectively. We face risks with respect to future expansion. We operate in an extremely competitive market, and our business will suffer if we are unable to compete effectively. Consumers may decide not to use banks to complete their financial transactions. Loss of key employees may disrupt relationships with certain customers. Impairment of goodwill or other intangible assets could require charges to earnings, which could result in a negative impact on our results of operations. We may be exposed to liability under non-solicitation agreements to which one or more of our employees may be a party to with certain of our competitors. Unauthorized disclosure of sensitive or confidential client or customer information, whether through a breach of our computer systems or otherwise, could severely harm our business.

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