What changed in this filing

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Item 1A. Risk Factors

2025-03-07 compared with 2024-03-08 · 137 added, 154 removed, 631 unchanged (32% of the section changed)

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“will continue”, “will likely result”, “will remain”, “would be”, or similar expressions.

The Private Securities Litigation Reform Act of

1995 provides a “safe harbor” for forward-looking statements to encourage companies to provide prospective information so

long as those statements are identified as forward-looking and are accompanied by meaningful cautionary statements identifying important

factors that could cause actual results to differ materially from those discussed in the forward-looking statements.

We desire to take

advantage of the “safe harbor” provisions of the Act.

The Private Securities Litigation Reform Act

of 1995 (the “Reform Act”) provides a “safe harbor” for forward-looking statements to encourage companies to

provide prospective information so long as those statements are identified as forward-looking and are accompanied by meaningful cautionary

statements identifying important factors that could cause actual results to differ materially from those discussed in the forward-looking

We desire to take advantage of the “safe harbor” provisions of the Reform Act.

Forward-looking statements involve risks and uncertainties.

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In addition, our lending and deposit gathering activities are concentrated

primarily in Northwest Ohio.

As a result, our success depends in large part on the general economic conditions of these areas,

particularly given that a significant portion of our lending relates to real estate located in this region.

Therefore, adverse

changes in the economic conditions in these areas could adversely impact our earnings and cash flows.

primarily in Northwest and Central Ohio.

As a result, our success depends in large part on the general economic conditions of these

areas, particularly given that a significant portion of our lending relates to real estate located in this region.

adverse changes in the economic conditions in these areas could adversely impact our earnings and cash flows.

Instability in global economic conditions and

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In addition, trade negotiations between the U.S.

and other nations remain uncertain

and could adversely impact economic and market conditions for the Company and our clients and counterparties.

Instability in global economic

conditions and geopolitical matters, such as military conflicts in Ukraine and the Middle East, as well as volatility in financial markets,

could have a material adverse effect on our results of operations and financial condition.

For example, on February 24, 2022, Russian

military forces invaded Ukraine, and sustained conflict and disruption in the region have occurred and remains likely to continue.

addition, the October 7, 2023, attack by Hamas in Israel has resulted in prolonged conflict and disruption in the Middle East.

the length, impact and outcome of the ongoing war in Ukraine and the conflict in the Middle East are highly unpredictable, these conflicts

have resulted, and could continue to result, in significant market and other disruptions, including significant volatility in commodity

prices and supply of energy resources, instability in financial markets, supply chain interruptions, political and social instability,

changes in consumer or purchaser preferences, as well as increases in cyberattacks and espionage.

The extent and duration of the military

action, sanctions and resulting market disruptions could be significant and could potentially have substantial impact on the global economy

and the Company’s business for an unknown period of time.

Any of the above-mentioned events or disruptions could affect our business,

financial condition and operating results, and may also magnify the impact of other risks described in this Form 10-K.

and other nations, including negotiations

related to recent tariffs and threats of tariffs by the U.S., remain uncertain and could adversely impact economic and market conditions

for the Company and our clients and counterparties.

Instability in global economic conditions and geopolitical matters, such as military

conflicts in Ukraine and the Middle East, as well as volatility in financial markets, could have a material adverse effect on our results

of operations and financial condition.

For example, on February 24, 2022, Russian military forces invaded Ukraine, and sustained conflict

and disruption in the region have occurred and remains likely to continue.

In addition, the October 7, 2023, attack by Hamas in Israel

has resulted in prolonged conflict and disruption in the Middle East.

Although the length, impact and outcome of the ongoing war in Ukraine

and the conflict in the Middle East are highly unpredictable, these conflicts have resulted, and could continue to result, in significant

market and other disruptions, including significant volatility in commodity prices and supply of energy resources, instability in financial

markets, supply chain interruptions, political and social instability, changes in consumer or purchaser preferences, as well as increases

in cyberattacks and espionage.

The extent and duration of the military action, sanctions and resulting market disruptions could be significant

and could potentially have substantial impact on the global economy and the Company’s business for an unknown period of time.

of the above-mentioned events or disruptions could affect our business, financial condition and operating results, and may also magnify

the impact of other risks described in this Form 10-K.

We may be unable to manage interest rate risks,

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on our financial condition and results of operations.

Moreover, the Financial Accounting Standards Board

(the “FASB”) has changed its requirements for establishing the ACL.

On June 16, 2016, the FASB issued

Accounting Standard Update (“ASU”) 2016-13 “Financial Instruments - Credit Losses”, which replaces the incurred loss

model with an expected loss model and is referred to as the CECL model.

Under the incurred loss model, loans are recognized as impaired

when there is no longer an assumption that future cash flows will be collected in full under the originally contracted terms.

CECL model, financial institutions are required to use historical information, current conditions and reasonable forecasts to estimate

the expected loss over the life of the loan.

The transition to the CECL model requires significantly greater data requirements and changes

to methodologies to accurately account for expected losses under the new parameters.

If the methodologies and assumptions that we use

in the CECL model are proven to be incorrect or inadequate, the ACL may not be sufficient, resulting in the need

for additional ACL to be established, which could have a material adverse impact on our financial condition and

results of operations.

Moreover, the Financial Accounting Standards

Board (the “FASB”) has changed its requirements for establishing the ACL.

On June 16, 2016, the FASB issued Accounting Standard

Update (“ASU”) 2016-13 “Financial Instruments - Credit Losses”, which replaced the incurred loss model with an expected

loss model and is referred to as the CECL model.

Under the incurred loss model, loans were recognized as impaired when there was no longer

an assumption that future cash flows would be collected in full under the originally contracted terms.

Under the CECL model, financial

institutions are required to use historical information, current conditions and reasonable forecasts to estimate the expected loss over

the life of the loan.

The transition to the CECL model requires significantly greater data requirements and changes to methodologies

to accurately account for expected losses under the new parameters.

If the methodologies and assumptions that we use in the CECL model

are proven to be incorrect or inadequate, the ACL may not be sufficient, resulting in the need for additional ACL to be established,

which could have a material adverse impact on our financial condition and results of operations.

The new CECL accounting guidance is effective

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core deposits, our operations, and consequently our earnings, could be adversely impacted.

Future acquisitions or other expansion may

adversely impact our financial condition and results of operations.

In the future, we may acquire other financial

institutions or branches or assets of other financial institutions.

We may also open new branches, enter into new lines of business, or

offer new products or services.

Any such acquisition or expansion of our business will involve a number of expenses and risks, which may

include some or all of the following:

Acquisitions or other expansion may adversely

impact our financial condition and results of operations.

We have completed various acquisitions of other

financial institutions and branches and assets of other financial institutions in the past, including our recent acquisition of Marblehead

Bancorp, Inc.

and its banking subsidiary, The Marblehead Bank, on January 17, 2025.

In the future, we may acquire other financial institutions

or branches or assets of other financial institutions.

We may also open new branches, enter into new lines of business, or offer new products

Any such acquisition or expansion of our business will involve a number of expenses and risks, which may include some or

all of the following:

time and expense associated with identifying and evaluating potential acquisitions or expansions;

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or alleged conduct in any number of activities, including lending practices, corporate governance, acquisitions, social media and other

marketing activities, and the implementation of environmental, social and governance (“ESG”) practices, and from actions taken by governmental

regulators and community organizations in response to any of the foregoing activities.

Negative public opinion could adversely affect

our ability to attract and keep customers, could expose us to potential litigation and regulatory action, and could have a material adverse

effect on the price of our common shares or result in heightened volatility of our stock price.

marketing activities, and from actions taken by governmental regulators and community organizations in response to any of the foregoing

Negative public opinion could adversely affect our ability to attract and keep customers, could expose us to potential litigation

and regulatory action, and could have a material adverse effect on the price of our common shares or result in heightened volatility

of our stock price.

Recent and future bank failures may adversely

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impacts on the national, regional and local banking industry and the business environment in which the Company operates.

The recent bank

failures of Silicon Valley Bank in California, Signature Bank in New York, and First Republic Bank in California during the first and

second quarters of 2023 have caused a degree of panic and uncertainty in the investor community and among bank customers generally.

the Company does not believe that the circumstances of these three bank failures are indicators of broader issues with the banking system,

these and any future bank failures may reduce customer confidence, affect sources of funding and liquidity (for example, by increasing

the withdrawal or transfer of deposits by customers), increase regulatory requirements and costs, adversely affect financial markets and/or

have a negative reputational ramification for the banking industry as a whole.

The Company will continue to monitor the ongoing events

concerning these three banks, as well as any future potential bank failures and/or volatility within the banking industry in general,

along with any responsive measures taken by the banking regulators to mitigate or manage potential turmoil in the banking industry.

The bank failures

of Silicon Valley Bank in California, Signature Bank in New York, and First Republic Bank in California during 2023 caused a degree of

panic and uncertainty in the investor community and among bank customers generally.

Similar bank failures may occur in the future, which

could reduce customer confidence, affect sources of funding and liquidity (for example, by increasing the withdrawal or transfer of deposits

by customers), increase regulatory requirements and costs, adversely affect financial markets and/or have a negative reputational ramification

for the banking industry as a whole.

The Company will continue to monitor future potential bank failures and/or volatility within the

banking industry in general, along with any responsive measures taken by the banking regulators to mitigate or manage potential turmoil

in the banking industry.

We could experience an unexpected inability

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will not be inoperable, to the extent possible.

We also routinely review documentation of such controls and backups related to third party

service providers.

Our inability to use or access these information systems at critical points in time could unfavorably impact the timeliness

and efficiency of our business operations.

In recent years, some banks have experienced cyberattacks with the goal and effect of disrupting

the ability of the bank to process transactions.

Other businesses have been victims of ransomware attacks in which the business becomes

unable to access its own information and is presented with a demand to pay a ransom in order to once again have access to its information.

We also routinely review documentation of such controls and backups related to third

party service providers.

Our inability to use or access these information systems at critical points in time could unfavorably impact

the timeliness and efficiency of our business operations.

In recent years, some banks have experienced cyberattacks with the goal and

effect of disrupting the ability of the bank to process transactions.

Other businesses and organizations have been victims of ransomware

attacks in which the business becomes unable to access its own information and is presented with a demand to pay a ransom in order to

once again have access to its information.

We could be adversely affected if one of our employees

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The banking industry is highly regulated.

are subject to supervision, regulation and examination by various federal and state regulators, including the FRB, the SEC, the CFPB,

the FDIC, Financial Industry Regulatory Authority, Inc.

subject to supervision, regulation and examination by various federal and state regulators, including the FRB, the ODFI, the SEC, the

CFPB, the FDIC, Financial Industry Regulatory Authority, Inc.

(“FINRA”), and various state regulatory agencies.

The statutory and

regulatory framework that governs the Company is generally designed to protect depositors and customers, the DIF, the U.S.

financial system, and financial markets as a whole and not to protect shareholders.

The statutory

and regulatory framework that governs the Company is generally designed to protect depositors and customers, the DIF, the U.S.

and financial system, and financial markets as a whole and not to protect shareholders.

These laws and regulations, among other matters,

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accounting principles in the United States of America.

Compliance with laws and regulations can be difficult and costly, and changes

to laws and regulations often impose additional compliance costs.

Both the scope of the laws and regulations and the intensity of the

supervision to which we are subject have increased in recent years in response to the perceived state of the financial services industry,

as well as other factors such as technological and market changes.

Such regulation and supervision may increase our costs and limit our

ability to pursue business opportunities.

Compliance with laws and regulations can be difficult and costly, and changes to

laws and regulations often impose additional compliance costs.

Both the scope of the laws and regulations and the intensity of the supervision

to which we are subject have increased in recent years in response to the perceived state of the financial services industry, as well

as other factors such as technological and market changes.

Such regulation and supervision may increase our costs and limit our ability

to pursue business opportunities.

Further, our failure to comply with these laws and regulations, even if the failure was inadvertent

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businesses are undergoing continuous change, and management cannot predict the effect of these changes.

While such changes are generally

intended to lessen the regulatory burden on financial institutions, the impact of any changes to laws and regulations or other actions

by regulatory agencies may negatively impact us or our ability to increase the value of our business.

Regulatory authorities have extensive

discretion in connection with their supervisory and enforcement activities, including the imposition of restrictions on the operation

of a financial institution, the classification of assets held by a financial institution, the adequacy of a financial institution’s

ACL and the ability to complete acquisitions.

Additionally, actions by regulatory agencies against us could cause

us to devote significant time and resources to defending our business and may lead to penalties that materially affect us and our shareholders.

Even the reduction of regulatory restrictions could have an adverse effect on us and our shareholders if such lessening of restrictions

increases competition within our industry or our market area.

The impact of any changes to

laws and regulations or other actions by regulatory agencies may negatively impact us or our ability to increase the value of our business.

Regulatory authorities have extensive discretion in connection with their supervisory and enforcement activities, including the imposition

of restrictions on the operation of a financial institution, the classification of assets held by a financial institution, the adequacy

of a financial institution’s ACL and the ability to complete acquisitions.

Additionally, actions by regulatory agencies against

us could cause us to devote significant time and resources to defending our business and may lead to penalties that materially affect

us and our shareholders.

Even the reduction of regulatory restrictions could have an adverse effect on us and our shareholders if such

lessening of restrictions increases competition within our industry or our market area.

Changes in accounting standards could influence

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the future, nor may we be able to obtain adequate replacement policies with acceptable terms, if at all.

We could face legal and regulatory risk arising

out of our residential mortgage business.

Numerous federal and state governmental, legislative

and regulatory authorities are investigating practices in the business of mortgage and home equity lending and servicing and in the mortgage-related

insurance and reinsurance industries.

We could face the risk of class actions, other litigation and claims from:

the owners of or purchasers

of such loans originated or serviced by us, homeowners involved in foreclosure proceedings or various mortgage-related insurance programs,

downstream purchasers of homes sold after foreclosure, title insurers, and other potential claimants.

Included among these claims are

claims from purchasers of mortgage and home equity loans seeking the repurchase of loans where the loans allegedly breached origination

covenants, representations, and warranties made to the purchasers in the purchase and sale agreements.

The CFPB has issued new rules

for mortgage origination and mortgage servicing.

Both the origination and servicing rules create new private rights of action for consumers

against lenders and servicers in the event of certain violations.

Risks Related to Our Capital and Common

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exchange rates, stock, commodity, credit or asset valuations or volatility.

Equity markets in general and our shares have

experienced volatility over the past few years.

The market price of our shares may continue to be subject to volatility unrelated to

our operating performance or business prospects, which could result in a decline in the market price of our shares.

Equity markets in general and our common shares

have experienced volatility over the past few years.

The market price of our common shares may continue to be subject to volatility unrelated

to our operating performance or business prospects, which could result in a decline in the market price of our common shares.

Investors could become subject to regulatory

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for their shares if we were purchased by another company.

Ohio law and our Amended Articles of Incorporation, as amended (“Articles”),

and Amended and Restated Regulations, as amended (“Regulations”), make it difficult for anyone to purchase us without the

approval of our Board of Directors.

Consequently, a takeover attempt may prove difficult, and shareholders may not realize the highest

possible price for their securities.

Ohio law and our Amended Articles of Incorporation, as amended, and Amended

and Restated Regulations, as amended, make it difficult for anyone to purchase us without the approval of our Board of Directors.

Consequently,

a takeover attempt may prove difficult, and shareholders may not realize the highest possible price for their securities.

We may be compelled to seek additional capital

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the financial statements.

Two of our most critical estimates are the level of the ACL and the accounting for

goodwill and other intangibles.

Because of the inherent nature of these estimates, we cannot provide complete assurance that we will

not be required to adjust earnings for significant unexpected loan losses, nor that we will not recognize a material provision for impairment

of our goodwill.

For additional information regarding these critical estimates, see Item 7.

Management’s Discussion and Analysis

of Financial Condition and Results of Operations beginning on page 32 of this Annual Report on Form 10-K.

We may experience increasing scrutiny and

evolving expectations from customers, regulators, investors, and other stakeholders with respect to the Company’s environmental,

social and governance practices.

Two of our most critical estimates are the level of the ACL and the accounting for goodwill and other intangibles.

Because of the inherent nature of these estimates, we cannot provide complete assurance that we will not be required to adjust earnings

for significant unexpected loan losses, nor that we will not recognize a material provision for impairment of our goodwill.

For additional

information regarding these critical estimates, see Item 7.

Management’s Discussion and Analysis of Financial Condition and Results

of Operations beginning on page 31 of this Annual Report on Form 10-K.

We may experience increasing scrutiny and evolving

expectations from customers, regulators, investors, and other stakeholders with respect to the Company’s environmental, social and

governance (“ESG”) practices.

Financial institutions are facing increasing

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and expanding mandatory and voluntary reporting, diligence, and disclosure.

We need to constantly update our technology

in order to compete and meet customer demands.

The financial services market, including banking

services, is undergoing rapid technological changes with frequent introductions of new technology-driven products and services.

to better serving customers, the effective use of technology increases efficiency and may enable us to reduce costs.

Our future success

will depend, in part, on our ability to use technology to provide products and services that provide convenience to customers and to

create additional efficiencies in our operations.

Some of our competitors have substantially greater resources to invest in technological

improvements.

We may not be able to effectively implement new technology-driven products and services or be successful in marketing these

products and services to our customers.

Failure to successfully keep pace with technological changes affecting the financial services

industry could negatively affect our growth, revenue and profit.

Climate change, severe weather, natural disasters,

acts of war or terrorism and other external events could significantly impact our business.

Natural disasters, including severe weather events

of increasing strength and frequency due to climate change, acts of war or terrorism, and other adverse external events could have a

significant impact on our ability to conduct business or upon third parties who perform operational services for us or our customers.

Such events could affect the stability of our deposit base, impair the ability of borrowers to repay outstanding loans, impair the value

of collateral securing loans, cause significant property damage, result in lost revenue or cause us to incur additional expenses.

need to constantly update our technology in order to compete and meet customer demands.

financial services market, including banking services, is undergoing rapid technological changes with frequent introductions of new technology-driven

products and services.

In addition to better serving customers, the effective use of technology increases efficiency and may enable us

to reduce costs.

Our future success will depend, in part, on our ability to use technology to provide products and services that provide

convenience to customers and to create additional efficiencies in our operations.

Some of our competitors have substantially greater

resources to invest in technological improvements.

We may not be able to effectively implement new technology-driven products and services

or be successful in marketing these products and services to our customers.

Failure to successfully keep pace with technological changes

affecting the financial services industry could negatively affect our growth, revenue and profit.

change, severe weather, natural disasters, acts of war or terrorism and other external events could significantly impact our business.

disasters, including severe weather events of increasing strength and frequency due to climate change, acts of war or terrorism, and

other adverse external events could have a significant impact on our ability to conduct business or upon third parties who perform operational

services for us or our customers.

Such events could affect the stability of our deposit base, impair the ability of borrowers to repay

outstanding loans, impair the value of collateral securing loans, cause significant property damage, result in lost revenue or cause

us to incur additional expenses.

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.

What changed 10-K

Item 1A. Risk Factors