Cautionary Statement Regarding Forward-Looking Statements
First National Corporation (the Company) makes forward-looking statements in this Form 10-K that are subject to risks and uncertainties. These forward-looking statements include, but are not limited to, statements regarding profitability, liquidity, adequacy of capital, allowance for credit losses, interest rate sensitivity, market risk, and growth strategy. The words “believes,” “expects,” “may,” “will,” “should,” “projects,” “contemplates,” “anticipates,” “forecasts,” “intends,” or other similar words or terms are intended to identify forward-looking statements. These forward-looking statements are subject to significant uncertainties because they are based upon or are affected by factors including:
| • | general business conditions, as well as conditions within the financial markets; |
| • | general economic conditions, including unemployment levels, inflation and slowdowns in economic growth; |
| • | the Company’s branch and market expansions, technology initiatives and other strategic initiatives; |
| • | the impact of competition from banks and non-banks, including financial technology companies (Fintech); |
| • | advances and changes in technology, including artificial intelligence, and the Company’s ability to develop timely and competitive products and services and effectively manage related risks; |
| • | the composition of the loan and deposit portfolio, including the types of accounts and customers, may change, which could impact the amount of net interest income and noninterest income in future periods, including revenue from service charges on deposits; |
| • | limited availability of financing or inability to raise capital; |
| • | reliance on third parties for key services; |
| • | the Company’s credit standards and its on-going credit assessment processes might not protect it from significant credit losses; |
| • | the quality of the loan portfolio and the value of the collateral securing those loans; |
| • | prepayments of loans and securities could materially impact earnings through a reduction in interest income and fees on loans and interest income on securities; |
| • | the level of net charge-offs on loans and the adequacy of the allowance for credit losses on loans; |
| • | the concentration in loans secured by real estate may adversely affect earnings due to changes in the real estate markets; |
| • | demand for loan products; |
| • | the ability to maintain adequate liquidity by retaining deposit customers and secondary funding sources, especially if the Company’s, or industry's, reputation become damaged; |
| • | the value of securities held in the Company's investment portfolio; |
| • | legislative or regulatory changes or actions, including the effects of changes in tax laws; |
| • | changes in accounting principles, policies and guidelines and elections made by the Company thereunder; |
| • | cyber threats, attacks or events; |
| • | monetary and fiscal policies of the U.S. Government, including policies of the U.S. Department of the Treasury and the Federal Reserve Board, and the effect of those policies on interest rates and business in the Company's markets; |
| • | changes in interest rates could have a negative impact on the value of the Company’s securities portfolio and its net interest income and an unfavorable impact on the Company’s customers’ ability to repay loans; |
| • | U.S. and global trade policies and tensions, including change in, or the imposition of, tariffs and/or other barriers or restrictions on trade and/or any retaliatory counter measures, and the economic impacts, volatility and uncertainty resulting therefrom, and geopolitical instability; |
| • | geopolitical conditions, including acts or threats of terrorism, international hostilities, or actions taken by the U.S. or other governments in response to acts or threats of terrorism and/or military conflicts, which could impact business and economic conditions in the U.S. and abroad; |
| • | the emergence of digital assets and payment stablecoins, and evolving legislative or regulatory frameworks, which could alter deposit flows, competition, and credit intermediation and, in turn, adversely affect the Company’s funding, liquidity, or overall financial performance; |
| • | political developments, including government shutdowns and other significant disruptions and changes in the funding, size, scope, and effectiveness of the federal government, its agencies and services; and |
| • | other factors identified in Item 1A, “Risk Factors”, below. |
Because of these and other uncertainties, actual future results may be materially different from the results indicated by these forward-looking statements. In addition, past results of operations do not necessarily indicate future results.
