354869--3/2/2006--FIRSTMERIT_CORP

related topics

{acquisition, growth, future}

{stock, price, share}

{regulation, change, law}

{loan, real, estate}

{financial, litigation, operation}

{tax, income, asset}

{loss, insurance, financial}

{competitive, industry, competition}

{operation, natural, condition}

{provision, law, control}

{personnel, key, retain}

Our earnings are significantly affected by the fiscal and monetary policies of the federal government and its agencies. Changes in economic and political conditions could adversely affect our earnings, as our borrowers ability to repay loans and the value of the collateral securing our loans decline. Terrorism, acts of war or international conflicts could have a material adverse effect on our financial condition and results of operations. The primary source of our income from which we pay dividends is the receipt of dividends from FirstMerit Bank. If our actual loan losses exceed our allowance for loan losses, our net income will decrease. We depend upon the accuracy and completeness of information about customers and counterparties. Our organizational documents may have the effect of discouraging a third party from making an acquisition of FirstMerit by means of a tender offer, proxy contest or otherwise. Government regulation can result in limitations on our operations. 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. Future sales of our common shares or other securities may dilute the value of our common shares. 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 officers may be a party to with certain of our competitors. The price of our common shares may be volatile, which may result in losses for shareholders.

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354869--3/2/2006--FIRSTMERIT_CORP_/OH/