Company: MCHB
Filing Date: 2025-07-16
Form Type: 424B3
Source: 0001140361-25-026051
Chunk: 80

Company: Mechanics Bancorp
Filing Date: 2025-07-16
Form: 424B3
Chunk 80
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 due to economic and other factors beyond Mechanics’ control, including the impact of tariffs. Any such event or failure to manage Mechanics’ liquidity effectively could affect Mechanics’ competitive position, increase its borrowing costs and the interest rates Mechanics pays on deposits, limit Mechanics’ access to the capital markets and have a material adverse effect on Mechanics’ consolidated financial condition and consolidated results of operations.

**Mechanics’ operational systems and networks have been, and will continue to be, subject to an increasing risk of continually evolving cybersecurity or other technological risks, which could result in a loss of customer business, financial liability, regulatory penalties, damage to Mechanics’ reputation or the disclosure of confidential information.**

Mechanics relies heavily on communications and information systems to conduct its business and maintain the security of confidential information and complex transactions, which subjects Mechanics to an increasing risk of cyber incidents, threats of cyberattacks from these activities, due to a combination of new technologies and the increasing use of the Internet to conduct financial transactions, and the potential failure, interruption or breach in the security of these systems, including those that could result from attacks or planned changes, upgrades and maintenance of these systems. Such cyber incidents could result in, and have in the past resulted in, failures or disruptions in Mechanics’ customer relationship management, securities trading, general ledger, deposits, computer systems, electronic underwriting servicing or loan origination systems, or the unauthorized disclosure of confidential and non-public information maintained within Mechanics’ systems. Mechanics also utilizes relationships with third parties to aid in a significant portion of its information systems, communications, data management and transaction processing. These third parties with which Mechanics does business may also be sources of cybersecurity or other technological risks, including operational errors, system interruptions or breaches, unauthorized disclosure of confidential information and misuse of intellectual property, and have experienced cyberattacks. Evolving technologies and the increased use of artificial intelligence and automation by third parties further increase the risk of cyberattacks and threats of cyberattacks against Mechanics or those third parties that Mechanics depends upon. If Mechanics’ third-party service providers encounter any of these issues, then Mechanics could be exposed to disruption of service, reputation damages, and litigation risk, any of which could have a material adverse effect on Mechanics’ business.

In 2023, a third-party vendor of Mechanics confirmed that data specific to Mechanics’ customers was likely obtained in a security incident targeting the vendor’s instance of a secure file transfer program. As a result of this, an

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unauthorized party likely obtained information