MVB Financial(MVBF) - 2024 Q4 - Annual Report

Financial Performance and Position - On-balance sheet gaming deposits totaled $227.6 million as of December 31, 2024, down from $354.1 million as of December 31, 2023[150] - Off-balance sheet gaming deposits totaled $221.0 million as of December 31, 2024, compared to $277.1 million as of December 31, 2023[150] - The company had $3.1 million of goodwill and other intangible assets as of December 31, 2024, with potential future write-downs impacting financial results[154] - The company anticipates potential volatility in earnings from Fintech investments, which could impact strategic initiatives[157] - The company may experience dilution of tangible book value and net income per common share from future acquisitions[163] Strategic Initiatives and Growth - The company is focused on long-term growth through new business initiatives, including investments in Fintech, which carry substantial risks[155] - The company sold its interest in Trabian in January 2025, indicating ongoing strategic asset management[162] Regulatory and Compliance Risks - The company is subject to extensive government regulation, which could adversely affect its business and operations[186] - The company's ability to pay dividends is restricted by capital adequacy requirements imposed by regulatory authorities[190] - The company's ability to pay dividends is uncertain and may depend on future earnings, capital requirements, and regulatory restrictions[197] - The company is subject to federal policies that restrict dividend payments, which could limit shareholder returns[197] - Compliance with Nasdaq listing requirements is critical; failure to maintain compliance could lead to delisting and adversely affect stock trading[194] Market and Economic Conditions - The company faces competitive pressures that may increase funding costs and compress net interest margins due to the gaming deposit base[150] - A deterioration in economic conditions may result in deposit base outflows, limiting access to customary sources of liquidity[166] - The trading volume of the company's common stock is lower than that of larger financial services companies, which may affect marketability and price stability[193] - The stock price can be volatile, influenced by factors such as quarterly results, sustainable core earnings, and general market conditions[195] - The company's stock price may be affected by geopolitical conditions and economic fluctuations, including the upcoming 2024 U.S. presidential election[196] Operational and Technological Risks - The company is adapting to technological changes and evolving legislation, which may increase operational and compliance risks[156] - Cyberattacks on information systems could adversely affect operations and harm the business[169] - The company relies on external vendors for day-to-day operations, exposing it to risks if these vendors do not perform satisfactorily[177] - A significant portion of the loan portfolio is secured by real property, which may expose the company to environmental liability risks[178] Financial Reporting and Credit Risks - Changes in accounting standards by FASB and SEC could materially affect how the company reports its financial condition and results of operations[204] - The company relies on analytical and forecasting models for credit loss estimates and fair value measurements, which may prove inadequate during market stress[206] - The company may need to increase its allowance for credit losses if actual losses exceed reserves, potentially impacting financial results[203] - The company faces risks related to credit and liquidity, which may impact the valuation of its securities portfolio and lead to accounting charges[199] - The company is subject to liquidity risk, which could disrupt its ability to meet financial obligations[164] - Limited availability of borrowings from the FHLB system could negatively impact earnings[167] - Failure to meet capital adequacy guidelines could compromise the company's status as a financial holding company[189]