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, utilities, taxes, maintenance, etc.).
−Removed: For example, the New York City Rent Guidelines Board established the maximum rent increase on certain apartments at 3.0% for a one-year lease beginning on or after October 1, 2023 and on or after September 30, 2024, while the overall inflation rate increased at a greater rate.
+Added: For example, the New York City Rent Guidelines Board established the maximum rent increase on certain apartments at 2.75% for a one-year lease and 5.25% for a two-year lease, beginning on or after October 1, 2024 and through September 30, 2025, and while the overall inflation rate increased at a greater rate.
In addition, overhead (including maintenance) expenses often increase significantly during inflationary periods.
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As a lender, we are exposed to the risk that customers may not repay their loans according to the original terms, and the collateral securing the payment of those loans may be insufficient to pay any remaining loan balance.
−Removed: Additionally, at December 31, 2023, our portfolio of commercial and industrial loans, and owner-occupied commercial real estate loans, totaled $2.31 billion, or 21.4% of our total loan portfolio.
+Added: Additionally, at December 31, 2024, our portfolio of business loans, totaled $2.73 billion, or 25.1% of our total loan portfolio.
We plan to continue to emphasize the origination of these types of loans, which generally expose us to a greater risk of nonpayment and loss than residential real estate loans because repayment of such loans often depends on the successful operations and income stream of the borrowers.
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We make various assumptions and judgments about the collectability of our loan portfolio, including the creditworthiness of borrowers and the value of the real estate and other assets serving as collateral for the repayment of loans.
−Removed: In determining the amount of the allowance for credit losses, we rely on loan quality reviews, our past loss experience and that of our peer group, and an evaluation of economic conditions, among other factors.
+Added: In determining the amount of the allowance for credit losses, we rely on loan quality reviews, our past loss experience and that of our peer group, and the accuracy of macro-economic forecasts over a reasonable and supportable forecast period, among other factors.
If our assumptions prove to be incorrect, the allowance for credit losses may not be sufficient to cover expected losses in the loan portfolio, resulting in additions to the allowance for credit losses.
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In addition, in accordance with a memorandum of understanding entered into between the CFPB and U.S.
−Removed: Department of Justice, the two agencies have agreed to coordinate efforts related to enforcing the fair
−Removed: lending laws, which includes information sharing and conducting joint investigations, and have done so on a number of occasions.
+Added: Department of Justice, the two agencies have agreed to coordinate efforts related to enforcing the fair lending laws, which includes information sharing and conducting joint investigations, and have done so on a number of occasions.
We face a risk of noncompliance and enforcement action with the federal Bank Secrecy Act (the “BSA”) and other anti-money laundering and counter terrorist financing statutes and regulations.
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In 2022, the Company issued $160.0 million of 5.00% Fixed-to-Floating Rate Subordinated Debentures due 2032.
+Added: In 2024, the Company issued $74.8 million of 9.00% Fixed-to-Floating Rate Subordinated Debentures due 2034.
Because these subordinated debentures rank senior to our common stock, if we fail to make timely principal and interest payments on the subordinated debentures, we may not pay any dividends on our common stock.
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retention of personnel from acquired companies or branches;
−Removed: competing effectively in geographic areas not previously served;
+Added: competing effectively in geographic areas not
+Added: previously served;
managing growth resulting from the transaction;
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Any decline in available funding could adversely impact the Company’s ability to originate loans, invest in securities, meet expenses, or to fulfill obligations such as meeting deposit withdrawal demands, any of which could have a material adverse impact on its liquidity, business, financial condition and results of operations.
−Removed: Our business may be adversely affected by conditions in the financial markets and economic conditions generally.
+Added: Our business may be adversely affected by conditions in the financial markets, the economic environment and governmental policies.
A favorable business environment is generally characterized by, among other factors, economic growth, efficient capital markets, low inflation, high business and investor confidence, and strong business earnings.
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or a combination of these or other factors.
−Removed: The Company's performance could be negatively affected to the extent there is deterioration in business and economic conditions, including persistent inflation, an inverted yield curve, rising prices, and supply chain issues or labor shortages,
−Removed: which have direct or indirect material adverse impacts on us, our customers, and our counterparties.
+Added: The Company's performance could be negatively affected to the extent there is deterioration in business and economic conditions, including persistent inflation, an inverted yield curve, rising prices, unemployment rates, supply chain issues, or labor shortages, which have direct or indirect material adverse impacts on us, our customers, and our counterparties.
Recessionary conditions may significantly affect the markets in which we do business, the financial condition of our borrowers, the value of our loans and investments, and our ongoing operations, costs and profitability.
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Such events may cause us to incur losses and may adversely affect our capital, liquidity, and financial condition.
+Added: Governmental policies, including, but not limited to, changes in government spending, the freezing of government funding or grants, or changes to the government workforce could have an adverse affect on consumers’ or businesses’ ability to pay their debts and/or affect the demand for loans and deposits.
Strong competition within our market area may limit our growth and profitability.
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Cyber threats are rapidly evolving, and we may not be able to anticipate or prevent all such attacks.
−Removed: If one or more
−Removed: of such events were to occur, this potentially could jeopardize confidential and other information processed and stored in, and transmitted through, our systems or otherwise cause interruptions or malfunctions in our operations or our customers' operations.
+Added: If one or more of such events were to occur, this potentially could jeopardize confidential and other information processed and stored in, and transmitted through, our systems or otherwise cause interruptions or malfunctions in our operations or our customers' operations.
In addition, we maintain interfaces with certain third-party service providers.
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Furthermore, shareholders and other stakeholders have begun to consider how corporations are addressing environmental, social and governance (“ESG”) issues.
−Removed: Governments, investors, customers and the general public are increasingly focused on ESG practices and disclosures, and views about ESG are diverse and rapidly changing.
−Removed: These shifts in investing priorities may result in adverse effects on the trading price of the Company’s common stock if investors determine that the Company has not made sufficient progress on ESG matters.
−Removed: The Company could also face potential negative ESG-related publicity in traditional media or social media if shareholders or other stakeholders determine that we have not adequately considered or addressed ESG matters.
−Removed: If the Company, or our relationships with certain customers, vendors or suppliers became the subject of negative publicity, our ability to attract and retain customers and employees, and our financial condition and results of operations, could be adversely impacted.
+Added: Governments, investors, customers and the general public are increasingly focused
+Added: on ESG practices and disclosures, and views about ESG are diverse and rapidly changing.
+Added: These shifts in investing priorities may result in adverse effects on the trading price of the Company’s common stock if the Company, or our relationships with certain customers, vendors or suppliers became the subject of negative publicity.
Accounting-Related Risks
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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.