Amerant Bancorp Inc

From time to time, in the ordinary course of business, we are involved in litigation, regulatory matters and other legal proceedings. These may include, but are not limited to, claims related to the ownership of funds in specific accounts, disputes over credit relationships, challenges to security interests in collateral, and foreclosure proceedings, employment-related claims and general tort matters. Such matters are incidental to our regular banking and lending operations.

While the outcome of legal proceedings is inherently uncertain, based on management’s current assessment and legal counsel’s advice, we do not believe that any pending litigation will have a material adverse effect on our financial position, results of operations or cash flows. Where appropriate, we establish reserves for potential losses in accordance with FASB ASC Topic 450, Contingencies, considering available information, management’s judgment and legal counsel’s guidance.

At least quarterly, we evaluate legal contingencies using the most current information available. If a loss is probable and reasonably estimable, we record a liability in our consolidated financial statements, adjusting reserves as necessary to reflect new developments. If the likelihood of loss is not probable or cannot be reasonably estimated, no reserve is recorded.

Based on current information, including insurance coverage, existing legal reserves, and ongoing legal assessments, we do not believe that liabilities arising from pending legal proceedings will materially impact our financial condition. However, due to the inherent uncertainty in litigation and regulatory matters, the final resolution of one or more cases can have a material effect on our financial position, results of operations, or cash flows in a particular reporting period.