835012--3/31/2010--COMMONWEALTH_BANKSHARES

related topics

{condition, economic, financial}

{loss, insurance, financial}

{stock, price, share}

{loan, real, estate}

{competitive, industry, competition}

{personnel, key, retain}

{system, service, information}

{financial, litigation, operation}

{regulation, change, law}

{control, financial, internal}

{cost, contract, operation}

{acquisition, growth, future}

We may incur significant credit losses, particularly in light of current market conditions. A continuation or further deterioration of the current economic environment could adversely impact our financial condition and results of operations. We may incur losses if we are unable to successfully manage interest rate risk. Increased liquidity could have a negative impact on our financial condition. General business and economic conditions may significantly affect our earnings. The Bank is deemed to be in troubled condition within the meaning of federal statutes and regulations. We may be adversely affected by economic conditions in our market area. Our small to medium-sized business target market may have fewer financial resources to weather a downturn in the economy. Our concentration of real estate loans subjects us to increased risks in the event real estate values continue to decline due to the economic recession, a further deterioration in the real estate markets or other causes. We have a concentration of credit exposure in commercial real estate. If our allowance for loan losses becomes inadequate, our results of operations may be adversely affected. Our deposit insurance premiums could be substantially higher in the future, which could have a material adverse effect on our future earnings. Our future success is dependent on our ability to compete effectively in the highly competitive banking industry. Our profitability may suffer because of rapid and unpredictable changes in the highly regulated environment in which we operate. We may not be able to manage risks inherent in our business, particularly given the recent turbulent and dynamic market conditions. A failure of the technology we use could harm our business and our information systems may experience a breach in security. An extended disruption of vital infrastructure and other business interruptions could negatively impact our business. The Company s controls and procedures may fail or be circumvented. The Federal Reserve may require us to commit capital resources to support our bank subsidiary. Our ability to attract and retain customers and employees could be adversely affected to the extent our reputation is harmed. We face substantial potential liability and significant regulatory action, which could have materially adverse financial consequences or cause significant reputational harm to us. The Parent s stock price can be volatile. The trading volume in the Parent s common stock is less than that of other financial services companies. An investment in the Parent s common stock is not an insured deposit. Consumers may decide not to use banks to complete their financial transactions. We rely heavily on our management team and the unexpected loss of any of those personnel could adversely affect our operations; we depend on our ability to attract and retain key personnel.

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835012--3/31/2010--COMMONWEALTH_BANKSHARES_INC