Company: MCHB
Filing Date: 2025-07-16
Form Type: 424B3
Source: 0001140361-25-026051
Chunk: 79

Company: Mechanics Bancorp
Filing Date: 2025-07-16
Form: 424B3
Chunk 79
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 on alternative funding sources of liquidity to meet growth

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in loans, deposit withdrawal demands or otherwise fund operations. Such alternative funding sources include FHLB advances, Federal Reserve borrowings, brokered deposits, unsecured federal funds lines of credit from correspondent banks and/or accessing the equity or debt capital markets. The availability of these alternative funding sources is subject to broad economic conditions, to regulation and to investor assessment of Mechanics’ financial strength and, as such, the cost of funds may fluctuate significantly and/or the availability of such funds may be restricted, thus impacting the net interest income of Mechanics, its immediate liquidity and/or its access to additional liquidity. Additionally, if Mechanics fails to remain “well-capitalized” its ability to utilize brokered deposits may be restricted. Mechanics has somewhat similar risks to the extent that high-balance core deposits exceed the amount of deposit insurance coverage available.

An inability to maintain or raise funds (including the inability to access alternative funding sources) in amounts necessary to meet Mechanics’ liquidity needs would have a substantial negative effect on its liquidity. Mechanics’ access to funding sources in amounts adequate to finance its activities, or on terms attractive to Mechanics, could be impaired by factors that affect Mechanics specifically or the financial services industry in general. For example, factors that could detrimentally impact Mechanics’ access to liquidity sources include Mechanics’ consolidated financial results, a decrease in the level of Mechanics’ business activity due to a market downturn or adverse regulatory action against it, a reduction in Mechanics’ credit rating, any damage to Mechanics’ reputation, counterparty availability, changes in the activities of Mechanics’ business partners, changes affecting Mechanics’ loan portfolio or other assets, or any other event that could cause a decrease in depositor or investor confidence in Mechanics’ creditworthiness and business. Those factors may lead to depositors withdrawing Mechanics’ deposits or creditors limiting its borrowings. Mechanics’ access to liquidity could also be impaired by factors that are not specific to Mechanics, such as general business conditions, interest rate fluctuations, severe volatility or disruption of the financial markets, bank closures or negative views and expectations about the prospects for the financial services industry as a whole, or legal, regulatory, accounting, and tax environments governing Mechanics’ funding transactions. In addition, Mechanics’ ability to raise funds is strongly affected by the general state of the U.S. and world economies and financial markets as well as the policies and capabilities of the U.S. government and its agencies, and may remain or become increasingly difficult