9 unchanged sentences
Banking regulations are primarily intended to protect depositors’ funds, federal deposit insurance funds and the banking system as a whole, not shareholders.
−Removed: These regulations affect United’s lending practices, capital structure, investment practices, dividend policy, operations and growth, among other things.
+Added: These regulations affect United’s lending practices, capital structure, investment practices, dividend policy, operations, growth, and the fees we can charge for certain products or transactions, among other things.
These regulations also impose obligations to maintain appropriate policies, procedures and controls, among other things, to detect, prevent and report money laundering and terrorist financing and to verify the identities of United’s customers.
3 unchanged sentences
Such changes could subject the Company to additional costs, limit the types of financial services and products United may offer and/or increase the ability of nonbanks to offer competing financial services and products, among other things.
−Removed: United expends substantial effort and incurs costs to improve its systems, audit capabilities, staffing and training in order to satisfy regulatory requirements, but the regulatory authorities may determine that such efforts are insufficient.
−Removed: Failure to comply with relevant laws, regulations or policies could result in enforcement and other legal actions, sanctions by regulatory agencies, civil money and criminal penalties, the loss of FDIC insurance, the revocation of a banking charter, significant fines and/or reputation damage, which could have a material adverse effect on United’s business, financial condition and results of operations.
+Added: United expends substantial effort and incurs costs to improve its systems, audit capabilities, staffing and training in order to seek to satisfy regulatory requirements and meet supervisory expectations, but the regulatory authorities may determine that such efforts are insufficient.
+Added: Failure to comply with relevant laws, regulations or policies or meet supervisory expectations could result in enforcement and other legal actions, sanctions by regulatory agencies, civil money and criminal penalties, the loss of FDIC insurance, the revocation of a banking charter, significant fines and/or reputation damage, which could have a material adverse effect on United’s business, financial condition and results of operations.
In this regard, government authorities, including the bank regulatory agencies, are pursuing aggressive enforcement actions with respect to compliance and other legal matters involving financial activities, which heightens the risks associated with actual and perceived compliance failures.
Directives issued to enforce such actions may be confidential and thus, in some instances, we are not permitted to publicly disclose these actions.
+Added: Litigation challenging actions or regulations by Federal or state authorities could, depending on the outcome, significantly affect the regulatory and supervisory framework affecting our operations.
+Added: For example, there is litigation pending to challenge the Federal Reserve Board’s regulation on permissible interchange fees on the ground that the regulation allows higher interchange fees than permitted by statute, which, if successful, could significantly and adversely affect the fees banks can charge on debit card transactions.
Any of the foregoing could have a material adverse effect on our business, financial condition and results of operations.
See the section captioned “Regulation and Supervision” included in Item 1.
−Removed: While the Company has policies and procedures designed to prevent any such violations, there can be no assurance that such violations will not occur.
+Added: While the Company has policies and procedures designed to prevent any violations of applicable laws or regulations, there can be no assurance that such violations will not occur.
In the normal course of business, United and its subsidiaries are routinely subject to examinations and challenges from federal and state tax authorities regarding the amount of taxes due in connection with investments that the Company has made and the businesses in which United has engaged.
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The costs and limitations related to this additional regulatory reporting regimen have yet to be fully determined, although they may be material and the limitations and restrictions that will be placed upon United Bank with respect to its consumer product offering and services may produce significant, material effects on United Bank (and United’s) profitability.
−Removed: United is subject to higher regulatory capital requirements and failure to comply with these standards may impact dividend payments, equity repurchases and executive compensation.
−Removed: United and United Bank are each required to comply with applicable capital adequacy standards established by the Federal Reserve Board (the “FRB”).
−Removed: From time to time, the FRB changes these capital adequacy standards.
+Added: United is subject to regulatory capital requirements and failure to comply with these standards may impact dividend payments, equity repurchases and executive compensation.
+Added: United and United Bank are each required to comply with applicable capital adequacy standards established by the Federal Reserve Board.
+Added: From time to time, the Federal Reserve Board changes these capital adequacy standards.
In particular, the capital requirements applicable to United under the Basel III rules became fully effective on January 1, 2019.
2 unchanged sentences
Banking institutions that fail to meet the effective minimum ratios including the capital conservation buffer will be subject to constraints on capital distributions, including dividends and share repurchases, and certain discretionary executive compensation.
−Removed: The severity of the constraints depends on the amount of the shortfall and the institution’s “eligible retained income” (that is, four quarter trailing net income, net of distributions and tax effects not reflected in net income).
−Removed: The Basel III changes have resulted in generally higher minimum capital ratios than in the past that requires United and its subsidiaries to maintain capital buffers above minimum requirements to avoid restrictions on capital distributions and executive bonus payments.
+Added: The severity of the constraints depends on the amount of the shortfall and the institution’s “eligible retained income” (that is, the greater of (i) net income for the preceding four quarters, net of distributions and associated tax effects not reflected in net income and (ii) the average net income over the preceding four quarters).
+Added: The Basel III changes have resulted in generally higher minimum capital ratios than in the past, including due to the need for United and its subsidiaries to maintain capital buffers above minimum requirements to avoid restrictions on capital distributions and executive bonus payments.
In addition, the application of more stringent capital requirements for United could, among other things, result in lower returns on invested capital, require the raising of additional capital and result in additional regulatory actions if United were to be unable to comply with such requirements.
1 unchanged sentence
United’s earnings are significantly affected by the fiscal and monetary policies of the federal government and its agencies .
−Removed: The policies of the Federal Reserve impact United significantly.
−Removed: The Federal Reserve regulates the supply of money and credit in the United States.
+Added: The policies of the Federal Reserve Board impact United significantly.
+Added: The Federal Reserve Board regulates the supply of money and credit in the United States.
Its policies directly and indirectly influence the rate of interest earned on loans and paid on borrowings and interest-bearing deposits and can also affect the value of financial instruments we hold.
1 unchanged sentence
Changes in those policies are beyond our control and are difficult to predict.
−Removed: Federal Reserve policies can also affect our borrowers, potentially increasing the risk that they may fail to repay their loans.
−Removed: For example, a tightening of the money supply by the Federal Reserve could reduce the demand for a borrower’s products and services.
+Added: Federal Reserve Board policies can also affect our borrowers, potentially increasing the risk that they may fail to repay their loans.
+Added: For example, a tightening of the money supply by the Federal Reserve Board could reduce the demand for a borrower’s products and services.
This could adversely affect the borrower’s earnings and ability to repay its loan, which could have a material adverse effect on our financial condition and results of operations.
−Removed: United may be terminated as a servicer of mortgage loans, be required to repurchase a mortgage loan or reimburse investors for credit losses on a mortgage loan, or incur costs, liabilities, fines and other sanctions if we fail to satisfy our servicing obligations, including our obligations with respect to mortgage loan foreclosure actions .
−Removed: United, through its mortgage banking subsidiary, Crescent, acts as servicer for approximately $1.2 billion of mortgage loans owned by third parties as of December 31, 2023.
−Removed: As a servicer for those loans, United has certain contractual obligations, including foreclosing on defaulted mortgage loans or, to the extent applicable, considering alternatives to foreclosure such as loan modifications or short sales.
−Removed: If United commits a material breach of its obligations as servicer, United may be subject to termination as servicer if the breach is not cured within a specified period of time following notice, causing United to lose servicing income.
−Removed: In some cases, United may be contractually obligated to repurchase a mortgage loan or reimburse the investor for credit losses incurred on the loan as a remedy for servicing errors with respect to the loan.
−Removed: If United has increased repurchase obligations because of claims that United did not satisfy our obligations as a servicer, or increased loss severity on such repurchases, United may have a significant reduction to net servicing income within its noninterest income.
−Removed: United may incur costs if United is required to, or if United elects to, re-execute or re-file documents or take other action in its capacity as a servicer in connection with pending or completed foreclosures.
−Removed: United may incur litigation costs if the validity of a foreclosure action is challenged by a borrower.
−Removed: If a court were to overturn a foreclosure because of errors or deficiencies in the foreclosure process, United may have liability to the borrower and/or to any title insurer of the property sold in foreclosure if the required process was not followed.
−Removed: These costs and liabilities may not be legally or otherwise reimbursable to United.
−Removed: In addition, if certain documents required for a foreclosure action are missing or defective, United could be obligated to cure the defect or repurchase the loan.
−Removed: United may incur liability to securitization investors relating to delays or deficiencies in its processing of mortgage assignments or other documents necessary to comply with state law governing foreclosures.
−Removed: The fair value of United’s mortgage servicing rights may be negatively affected to the extent our servicing costs increase because of higher foreclosure costs.
−Removed: United may be subject to fines and other sanctions imposed by federal or state regulators as a result of actual or perceived deficiencies in our foreclosure practices or in the foreclosure practices of other mortgage loan servicers.
−Removed: Any of these actions may harm United’s reputation or negatively affect its home lending or servicing business.
United may be required to repurchase mortgage loans or indemnify buyers against losses in some circumstances, which could harm liquidity, results of operations and financial condition .
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In addition, United may be required to repurchase mortgage loans as a result of early payment default of the borrower on a mortgage loan.
−Removed: With respect to loans that are originated through United’s broker or correspondent channels, the remedies available against the originating broker or correspondent, if any, may not be as broad as the remedies available to purchasers, guarantors and insurers of mortgage loans against United.
−Removed: United faces further risk that the originating broker or correspondent, if any, may not have financial capacity to perform remedies that otherwise may be available.
−Removed: Therefore, if a purchaser, guarantor or insurer enforces its remedies against United, it may not be able to recover losses from the originating broker or correspondent.
If repurchase and indemnity demands increase and such demands are valid claims and are in excess of United’s provision for potential losses, its liquidity, results of operations and financial condition may be adversely affected.
There are no assurances as to adequacy of the allowance for credit losses.
−Removed: The FASB’s Accounting Standards Update 2016-13, effective for United as of January 1, 2020, substantially changes the accounting for credit losses on loans, leases and other financial assets held by banks, financial institutions and other organizations.
−Removed: The new standard requires the recognition of credit losses on loans, leases and other financial assets based on an entity’s current estimate of expected losses over the lifetime of each loan, lease or other financial asset,
−Removed: referred to as the Current Expected Credit Loss (“CECL”) model as opposed to the previous “incurred loss” model, which required recognition of losses on loans, leases and other financial assets only when those losses had incurred.
−Removed: Under the CECL model, United is required to present these certain financial assets, carried at amortized cost, at the net amount expected to be collected over the life of the financial asset.
+Added: The accounting for credit losses on loans, leases and other financial assets held by banks, financial institutions and other organizations requires the recognition of credit losses on loans, leases and other financial assets based on an entity’s current estimate of expected losses over the lifetime of each loan, lease or other financial asset, referred to as the Current Expected Credit Loss (“CECL”) model.
+Added: Under the CECL model, United is required to present certain financial assets, carried at amortized cost, at the net amount expected to be collected over the life of the financial asset.
The measurement of expected credit losses is based on information about past events, including credit quality, our historical experience, current conditions, and reasonable and supportable macroeconomic forecasts that may affect the collectability of the reported amount.
This measurement will take place at the time a financial asset is first added to the balance sheet and at least quarterly thereafter.
−Removed: CECL also requires management judgment that is supported by new models and more data elements, including macroeconomic forecasts, than the previous allowance standard.
−Removed: This increased the complexity and associated risk, particularly in times of economic uncertainty or other unforeseen circumstances, which could impact United’s results of operations and capital levels as well as place stress on our internal controls over financial reporting.
+Added: CECL requires management judgment that is supported by models and data elements, including macroeconomic forecasts.
+Added: The complexity and associated risk of CECL, particularly in times of economic uncertainty or other unforeseen circumstances, could impact United’s results of operations and capital levels as well as place stress on our internal controls over financial reporting.
The determination of the appropriate level of allowance for credit losses inherently involves a high degree of subjectivity and requires us to make significant estimates related to current and expected future credit risks and trends, all of which may undergo material changes.
1 unchanged sentence
new information regarding existing loans, credit commitments and securities holdings;
+Added: global pandemics;
natural disasters and risks related to climate change;
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While United has policies and procedures designed to prevent or limit the effect of the failure, interruption or security breach of its information systems, there can be no assurance that any such failures, interruptions or security breaches will not occur or, if they do occur, that they will be adequately addressed.
+Added: It is also possible that employees, merchants or United’s third-party vendors may not follow United’s policies and procedures, which may expose United to a security breach.
The occurrence of any failures, interruptions or security breaches of the Company’s information systems could damage United’s reputation, result in a loss of customer business, subject United to additional regulatory scrutiny, or expose the Company to civil litigation and possible financial liability, any of which could have a material adverse effect on United’s financial condition and results of operations.
2 unchanged sentences
Despite the security measures we have in place, our facilities and systems may be vulnerable to cyber-attacks, security breaches, acts of vandalism, computer viruses, misplaced or lost data, programming and/or human errors, or other similar events.
−Removed: Information security risks for financial institutions like us have increased recently in part because of new technologies, the use of the internet and telecommunications technologies (including mobile devices) to conduct financial and other business transactions, employees working from home and the increased sophistication and activities of organized crime, perpetrators of fraud, hackers, terrorists and others.
+Added: Like other U.S.
+Added: financial services companies, United has been and expects to continue to be the target of cyber-attacks and other attempts to disrupt its operations.
+Added: Information security risks for financial institutions like us have increased recently in part because of new technologies, such as artificial intelligence and quantum computing, the use of the internet and telecommunications technologies (including mobile devices) to conduct financial and other business transactions, employees working from home, the increased connectivity of third parties (including contractors) and electronic devices to United’s systems, and the increased sophistication and activities of organized crime, perpetrators of fraud, hackers, terrorists and others.
In addition to cyber-attacks or other security breaches involving the theft of sensitive and confidential information, hackers have engaged in attacks against large financial institutions, particularly denial of service attacks, designed to disrupt key business services such as customer-facing web sites.
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The occurrence of any failures, interruptions or security breaches of United’s information systems could damage its reputation, result in a loss of customer business, subject it to additional regulatory scrutiny or expose it to civil litigation and possible financial liability, any of which could have a material adverse effect on results of operations.
−Removed: The negative economic effects caused by terrorist attacks, including cyber-attacks, potential attacks and other destabilizing events would likely contribute to the deterioration of the quality of United’s loan portfolio and could reduce its customer base, level of deposits, and demand for its financial products such as loans.
−Removed: High inflation, natural disasters, acts of terrorism, including cyber-attacks, an escalation of hostilities or other international or domestic occurrences, and other factors could have a negative impact on the economy of the Mid-Atlantic and Southeast regions in which United operates.
−Removed: An additional economic downturn in its markets would likely contribute to the deterioration of the quality of United’s loan portfolio by impacting the ability of its customers to repay loans, the value of the collateral securing loans, and may reduce the level of deposits in its bank and the stability of its deposit funding sources.
−Removed: An additional economic downturn could also have a significant impact on the demand for United’s products and services.
−Removed: The cumulative effect of these matters on United’s results of operations and financial condition would likely be adverse and material.
Our growth-oriented business strategy could be adversely affected if we are not able to attract and retain skilled employees or if we lose the services of our senior management team.
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Poor quality services could damage United’s reputation with its customers.
−Removed: In addition, these third party service providers are sources of operational and informational security risk to United, including risks associated with operational errors, information system interruptions or breaches, and unauthorized disclosures of sensitive or confidential client or customer information.
+Added: In addition, these third party service providers are sources of operational, cybersecurity and informational security risk to United, including risks associated with operational errors, coding errors, information system interruptions or breaches, and unauthorized disclosures of sensitive or confidential client or customer information.
If third party service providers encounter any of these issues, or if United has difficulty communicating with them, United could be exposed to disruption of operations, loss of service or connectivity to customers, reputational damage, and litigation risk that could have a material adverse effect on our results of operations or our business.
3 unchanged sentences
United’s success depends, to a certain extent, upon local and national economic and political conditions, as well as governmental monetary policies.
−Removed: Conditions such as an economic recession, rising unemployment, changes in interest rates, money supply and other factors beyond its control may adversely affect United’s and United Bank’s asset quality, deposit levels and loan demand and, therefore, its earnings.
+Added: Conditions such as an economic recession, rising unemployment, changes in interest rates, money supply reductions in government spending or the size of the government workforce, concerns relating to the U.S.
+Added: debt ceiling, the imposition of tariffs and retaliatory responses, changes in trade or immigration policy and other factors beyond its control may adversely affect United’s and United Bank’s asset quality, deposit levels and loan demand and, therefore, its earnings.
Because United has a significant amount of real estate loans, decreases in real estate values could adversely affect the value of property used as collateral.
3 unchanged sentences
Such conditions could also have a material adverse effect on the credit quality of our loans and our business, financial condition and results of operations.
+Added: Concern regarding the ability of Congress to reach agreement on federal budgetary matters (including the debt ceiling), or total or partial governmental shutdowns, also can adversely affect the economy and increase the risk of economic instability or market volatility, which could have adverse consequences on United’s business, financial condition, liquidity and results of operations.
The value of certain investment securities is volatile and future declines in value could have a materially adverse effect on future earnings and regulatory capital.
4 unchanged sentences
United operates in a highly competitive market.
−Removed: United faces a high degree of competition in all of the markets it serves.
−Removed: United faces strong competition in gathering deposits, making loans and obtaining client assets for management by its investment or trust operations.
−Removed: United considers all of West Virginia to be included in its market area.
−Removed: This area includes the five largest West Virginia Metropolitan Statistical Areas (“MSA”):
−Removed: the Parkersburg MSA, the Charleston MSA, the Huntington MSA, the Morgantown MSA and the Wheeling MSA.
−Removed: United serves the Ohio counties of Lawrence, Belmont, Jefferson and Washington and Fayette county in Pennsylvania primarily because of their close proximity to the Ohio and Pennsylvania borders and United banking offices located in those counties or in nearby West Virginia.
−Removed: United’s Virginia markets
−Removed: include the Maryland, northern Virginia and Washington, D.C.
−Removed: MSA, the Winchester MSA, the Harrisonburg MSA, and the Charlottesville MSA.
−Removed: Through its acquisition of Carolina Financial, United’s market also includes the Coastal, Midlands, and Upstate regions of South Carolina, including the Charleston (Charleston, Dorchester and Berkeley Counties), Myrtle Beach (Horry and Georgetown Counties), Columbia (Richland and Lexington Counties), and the Upstate (Greenville and Spartanburg Counties) areas as well as areas in North Carolina including Wilmington (New Hanover County), Raleigh-Durham (Durham and Wake Counties), Charlotte-Concord-Gastonia (NC and SC) and the southeastern coastal region of North Carolina (Bladen, Brunswick, Columbus, Cumberland, Duplin and Robeson Counties).
−Removed: Through its acquisition of Community Bankers Trust, United added new markets in Baltimore and Annapolis, Maryland and Lynchburg and Richmond, Virginia as well as the Northern Neck of Virginia.
−Removed: United considers all of the above locations to be the primary market area for the business of its banking and mortgage banking subsidiaries.
+Added: United faces a high degree of competition in all of the markets we serve and thus faces strong competition in gathering deposits, making loans and obtaining client assets for management by its investment or trust operations.
+Added: There is significant competition among commercial banks in our market areas as well as with other providers of financial services, such as savings and loan associations, credit unions, consumer finance companies, securities firms, private equity and debt funds, commercial finance and leasing companies, full service brokerage firms, discount brokerage firms, and financial/wealth technology firms.
+Added: Some of our competitors have greater resources and, as such, may have higher lending limits and may offer other services that are not provided by us.
+Added: United generally competes on the basis of customer service, responsiveness to customer needs, available loan and deposit products, the rates of interest charged on loans, the rates of interest paid for funds, and the availability and pricing of trust and brokerage services.
There is a risk that aggressive competition could result in United controlling a smaller share of these markets.
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Net interest income is the difference between the interest income United earns on loans and other assets which earn interest and the interest expense incurred to fund those assets, such as on savings deposits and borrowed money.
−Removed: Therefore, changes in general market interest rates, such as a change in the monetary policy of the Board of Governors of the Federal Reserve System or otherwise beyond those which are contemplated by United’s interest rate risk model and policy, could have an effect on net interest income.
+Added: Therefore, changes in general market interest rates, such as a change in the monetary policy of the Federal Reserve Board or otherwise beyond those which are contemplated by United’s interest rate risk model and policy, could have an effect on net interest income.
For more information concerning United’s interest rate risk model and policy, see the discussion in Quantitative and Qualitative Disclosures About Market Risk included in Part II, under Item 7A of this Form 10-K.
11 unchanged sentences
Acquisitions may also result in potential dilution to existing shareholders of our earnings per share if we issue common stock in connection with the acquisition.
−Removed: Furthermore, failure to realize the expected revenue increases, cost savings, increases in geographic or product presence, and/or other projected benefits from an acquisition could have a material adverse effect on our business, financial condition and results of operations.
+Added: Furthermore, we may incur substantial costs in pursuing acquisition opportunities, and we cannot guarantee that such acquisition opportunities will be successful or result in the expected revenue increases, cost savings, increases in geographic or product presence, and/or other projected benefits from an acquisition.
+Added: Failure to realize these benefits could have a material adverse effect on our business, financial condition and results of operations.
+Added: Moreover, there can be no guarantee that post-acquisition intergration efforts will be successful, or that after giving effect to an acquisition, we will achieve financial results comparable to, or better than, our historical performance.
In addition, from time to time, bank regulators may restrict the Company from making acquisitions.
2 unchanged sentences
Acquisitions by financial institutions, including us, are subject to approval by a variety of federal and state regulatory agencies (collectively, “regulatory approvals”).
−Removed: The process for obtaining these required regulatory approvals has become substantially more difficult since the global financial crisis, and our ability to engage in certain merger or acquisition transactions depends on the bank regulators’ views at the time as to our capital levels, quality of management, and overall condition, in addition to their assessment of a variety of other factors, including our compliance with law.
−Removed: Regulatory approvals could be delayed, impeded, restrictively conditioned or denied due to existing or new regulatory issues we have, or may have, with regulatory agencies, including, without limitation, issues related to Bank Secrecy Act compliance, Community Reinvestment Act issues, fair lending laws, fair housing laws, consumer protection laws, unfair, deceptive, or abusive acts or practices regulations and other laws and regulations.
+Added: The process for obtaining these required regulatory approvals involves a comprehensive application review process, and our ability to engage in certain merger or acquisition transactions depends on the bank regulators’ views at the time as to our capital levels, quality of management, and overall condition, in addition to their assessment of a variety of other factors, including our compliance with law.
+Added: Regulatory approvals could be delayed, impeded, restrictively conditioned or denied due to existing or new regulatory issues we have, or may have, with regulatory agencies, including, without limitation, issues related to BSA compliance, CRA issues, fair lending laws, fair housing laws, consumer protection laws, unfair, deceptive, or abusive acts or practices regulations and other laws and regulations.
+Added: In recent years, acquisitions by financial institutions have encountered greater regulatory, governmental and community scrutiny and have taken substantially longer to receive the required regulatory approvals and other required governmental clearances than in the past.
We may fail to pursue, evaluate or complete strategic and competitively significant acquisition opportunities as a result of our inability, or perceived or anticipated inability, to obtain regulatory approvals in a timely manner, under reasonable conditions or at all.
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Adverse changes in government regulations;
+Added: Political uncertainty in the United States;
Geopolitical conditions such as acts or threats of terrorism or military conflicts.
7 unchanged sentences
An investment in United common stock is not an insured deposit.
−Removed: United common stock is not a bank deposit and, therefore, is not insured against loss by the Federal Deposit Insurance Corporation, any other deposit insurance fund or by any other public or private entity.
+Added: United common stock is not a bank deposit and, therefore, is not insured against loss by the FDIC, any other deposit insurance fund or by any other public or private entity.
Investment in United common stock is inherently risky for the reasons described in this section and elsewhere in this report and is subject to the same market forces that affect the price of common stock in any company.
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Current accounting and tax rules, standards, policies and interpretations influence the methods by which financial institutions conduct business, implement strategic initiatives and tax compliance, and govern financial reporting and disclosures.
−Removed: These laws, regulations, rules, standards, policies, and interpretations are constantly evolving and may change significantly over time.
+Added: These laws, regulations, rules, standards, policies, and interpretations are constantly evolving and may change significantly over time, and are difficult to predict.
Events that may not have a direct impact on United, such as the bankruptcy of major U.S.
−Removed: companies, have resulted in legislators, regulators and authoritative bodies, such as the Financial Accounting Standards Board, the SEC, the Public Company Accounting Oversight Board, and various taxing authorities, responding by adopting and/or proposing substantive revision to laws, regulations, rules, standards, policies, and interpretations.
+Added: companies, have resulted in legislators, regulators and authoritative bodies, such as the Financial Accounting Standards Board, the SEC, the Public Company Accounting Oversight
+Added: Board, and various taxing authorities, responding by adopting and/or proposing substantive revision to laws, regulations, rules, standards, policies, and interpretations.
New accounting pronouncements and varying interpretations of accounting pronouncements have occurred and may occur in the future.
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Although management has established disaster recovery policies and procedures, the occurrence of any such event could have a material adverse effect on United’s business, which, in turn, could have a material adverse effect on the Company’s financial condition and results of operations.
−Removed: Increasing scrutiny and evolving expectations from customers, regulators, investors, and other stakeholders with respect to United’s environmental, social and governance practices may impose additional costs on us or expose us to new or additional risks.
−Removed: Companies are facing increasing scrutiny from customers, regulators, investors, and other stakeholders related to their environmental, social and governance (“ESG”) practices and disclosure.
−Removed: Investor advocacy groups, investment funds and influential investors are also increasingly focused on these practices, especially as they relate to the environment, health and safety, diversity, labor conditions and human rights.
−Removed: Increased ESG-related compliance costs for United as well as among our suppliers, vendors and various other parties within our supply chain could result in increases to our overall operational costs.
−Removed: Failure to adapt to or comply with regulatory requirements or investor or stakeholder expectations and standards could negatively impact United’s reputation, ability to do business with certain partners, access to capital, and our stock price.
−Removed: New government regulations could also result in new or more stringent forms of ESG oversight and expanding mandatory and voluntary reporting, diligence, and disclosure.
−Removed: Climate change and related legislative and regulatory initiatives may materially affect United’s business and results of operations.
−Removed: The effects of climate change continue to create an alarming level of concern for the state of the global environment.
−Removed: As a result, the global business community has increased its political and social awareness surrounding the issue, and the United States has entered into international agreements in an attempt to reduce global temperatures, such as reentering the Paris Agreement.
−Removed: Further, the U.S.
−Removed: Congress, state legislatures and federal and state regulatory agencies continue to propose numerous initiatives to supplement the global effort to combat climate change.
−Removed: Similar and even more expansive initiatives are expected under the current administration, including potentially increasing supervisory expectations with respect to banks’ risk management practices, accounting for the effects of climate change in stress testing scenarios and systemic risk assessments, revising expectations for credit portfolio concentrations based on climate-related factors and encouraging investment by banks in climate-related initiatives and lending to communities disproportionately impacted by the effects of climate change.
−Removed: The lack of empirical data surrounding the credit and other financial risks posed by climate change render it impossible to predict how specifically climate change may impact our financial condition and results of operations;
−Removed: however, the physical effects of climate change may also directly impact us.
−Removed: Specifically, unpredictable and more frequent weather disasters may adversely impact the value of real property securing the loans in our portfolios.
+Added: The negative economic effects caused by terrorist attacks, including cyber-attacks, potential attacks and other destabilizing events would likely contribute to the deterioration of the quality of United’s loan portfolio and could reduce its customer base, level of deposits, and demand for its financial products such as loans.
+Added: High inflation, natural disasters, acts of terrorism, including cyber-attacks, an escalation of hostilities or other international or domestic occurrences, and other factors could have a negative impact on the economy of the Mid-Atlantic and Southeast regions in which United operates.
+Added: An additional economic downturn in its markets would likely contribute to the deterioration of the quality of United’s loan portfolio by impacting the ability of its customers to repay loans, the value of the collateral securing loans, and may reduce the level of deposits in its bank and the stability of its deposit funding sources.
+Added: An additional economic downturn could also have a significant impact on the demand for United’s products and services.
+Added: The cumulative effect of these matters on United’s results of operations and financial condition would likely be adverse and material.
+Added: Climate change may materially affect United’s business and results of operations.
+Added: We may be subject to physical and transition risks from climate change.
+Added: Both physical and transition risks from climate change may have negative impacts on the financial condition or creditworthiness of our customers and may negatively affect our business and result of operations.
+Added: Physical risks refer to the harm arising from acute, climate-related events, such as hurricanes, wildfires, floods, and heatwaves, and chronic shifts in climate, including higher average temperatures, changes in precipitation patterns, sea level rise, and ocean acidification.
+Added: Specifically, unpredictable and more frequent weather disasters may adversely impact the value of our properties and the value of real property securing the loans in our portfolios.
Additionally, if insurance obtained by our borrowers is insufficient to cover any losses sustained to the collateral, or if insurance coverage is otherwise unavailable to our borrowers, the collateral securing our loans may be negatively impacted by climate change, which could impact our financial condition and results of operations.
Further, the effects of climate change may negatively impact regional and local economic activity, which could lead to an adverse effect on our customers and impact the communities in which we operate.
−Removed: We are also subject to reputational risk from shareholder concerns about our practices related to climate change, our carbon footprint and our business relationships with customers who operate in carbon-intensive industries.
−Removed: Our business, reputation and ability to attract and retain employees may also be harmed if our response to climate change is perceived to be ineffective or insufficient.
−Removed: Climate change also exposes us to transition risks associated with the transition to a less carbon-dependent economy.
+Added: Climate change also exposes us and our customers to transition risks associated with the transition to a less carbon-dependent economy.
Transition risks may result from changes in policies;
4 unchanged sentences
We have customers who operate in carbon-intensive industries like oil and gas that are exposed to climate risks, such as those risks related to the transition to a less carbon-dependent economy, as well as customers who operate in low-carbon industries that may be subject to risks associated with new technologies.
−Removed: Federal and state banking regulators and supervisory authorities, investors and other stakeholders have increasingly viewed financial institutions as important in helping to address the risks related to climate change both directly and with respect to their customers, which may result in financial institutions coming under increased pressure regarding the disclosure and management of their climate risks and related lending and investment activities.
−Removed: Given that climate change could impose systemic risks upon the financial sector, either via disruptions in economic activity resulting from the physical impacts of climate change or changes in policies as the economy transitions to a less carbon-intensive environment, we face regulatory risk of increasing focus on our resilience to climate-related risks, including in the context of stress testing for various climate stress scenarios.
−Removed: Ongoing legislative or regulatory uncertainties and changes regarding climate risk management and practices may result in higher regulatory, compliance, credit and reputational risks and costs.
+Added: In addition, ongoing legislative or regulatory uncertainties and changes regarding climate risk management and practices, including the shifting sentiment against climate and sustainability initiatives, may subject us to different and potentially conflicting requirements and result in higher regulatory, compliance, credit and reputational risks and costs.
+Added: We may also be subject to reputational risk and negative public opinion from shareholder concerns about our, actual or perceived, action, or inaction, in response to climate change, our carbon footprint and our business relationships with customers who operate in carbon-intensive industries.
+Added: Our business, reputation and ability to retract and retain employees may be harmed due to stakeholder views and perceptions of our response to climate change.
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.