747345--3/12/2010--SMITHTOWN_BANCORP

related topics

{loan, real, estate}

{stock, price, share}

{competitive, industry, competition}

{acquisition, growth, future}

{condition, economic, financial}

{debt, indebtedness, cash}

{capital, credit, financial}

{operation, natural, condition}

{stock, price, operating}

{personnel, key, retain}

{product, market, service}

{financial, litigation, operation}

{loss, insurance, financial}

{system, service, information}

{control, financial, internal}

{product, liability, claim}

{provision, law, control}

Risks Related to the Company s Business and Operations Our banking subsidiary is operating under a Consent Agreement with the FDIC and the Banking Department to address lending, credit, capital and related issues The Company is subject to the risk of the bank subsidiary not meeting higher capital ratios required by the Consent Agreement Current and future restrictions on the conduct of our business could adversely impact our ability to attract deposits The Company has grown significantly but is not likely to sustain this rate of growth The Bank is subject to risk related to the concentration of its loan portfolio The Bank is subject to the risk of having to develop new lines of lending The Bank is subject to lending risk Continued or further declines in the value of certain investment securities could require write-downs, which would reduce our earnings A substantial decline in the value of our Federal Home Loan Bank of New York common stock may adversely affect our financial condition. The Bank s allowance for loan losses may be insufficient Changes in interest rates could affect profitability The Company relies on dividends from its subsidiaries for most of its revenue The Bank operates in a highly competitive industry and market area The loss of key personnel could impair the Company s future success The Company operates in a highly regulated environment The Company s controls and procedures may fail or be circumvented The Company s information systems may experience an interruption or breach in security The Bank continually encounters technological change The Company is subject to claims and litigation pertaining to fiduciary responsibility The Bank is subject to environmental liability risk associated with lending activities Severe weather, natural disasters, acts of war or terrorism and other external events could significantly impact the Company s business Risks Associated with the Company s Common Shares The Company may issue additional common shares or equity derivative securities that will dilute the percentage ownership interest of existing stockholders and may dilute the book value per share of its common shares and adversely affect the terms on which the Company may obtain additional capital The Company s directors, executive officers and employee stock ownership plan own a substantial amount of the Company s common shares and may significantly impact the outcome of future shareholder votes The Company s share price can be volatile The trading volume in the Company s common shares is less than that of other larger financial services companies An investment in the Company s common shares is not an insured deposit The Company s Certificate of Incorporation, By-Laws and Shareholders Protection Rights Agreement, as well as certain banking laws, may have an anti-takeover effect The Company s ability to pay cash dividends is limited, and it may be unable to pay future dividends even if it desires to do so Risks Associated with the Company s Industry The earnings of financial services companies are significantly affected by general business and economic conditions The soundness of other financial institutions could adversely affect the Company Financial services companies depend on the accuracy and completeness of information about customers and counterparties Consumers may decide not to use banks to complete their financial transactions

Full 10-K form ▸

747345--3/12/2010--SMITHTOWN_BANCORP_INC