Company: MCHB
Filing Date: 2025-07-03
Form Type: S-4
Source: 0001140361-25-024872
Chunk: 103

Company: Mechanics Bancorp
Filing Date: 2025-07-03
Form: S-4
Chunk 103
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, yet more likely to occur, following the transition of power from one presidential administration to another, especially as occurred in 2025, when it involves a change in the governing political party. Any such changes could subject Mechanics’ business to additional costs, limit the types of financial services and products Mechanics may offer and increase the ability of non-banks to offer competing financial services and products, among other things.

**Mechanics’ failure to comply with stringent capital requirements could result in regulatory criticism, requirements and restrictions, and Mechanics may be subject to more stringent capital requirements in the future.**

Mechanics is subject to capital adequacy guidelines and other regulatory requirements specifying minimum amounts and types of capital which it must maintain. From time to time, the regulators change these regulatory capital adequacy guidelines. Mechanics’ failure to meet applicable regulatory capital requirements could result in one or more of Mechanics’ regulators placing limitations or conditions on Mechanics’ activities. If Mechanics fails to meet the minimum capital guidelines and other regulatory requirements as applicable to Mechanics, then Mechanics may be restricted in the types of activities it may conduct, and Mechanics may be prohibited from taking certain capital actions. Failure to meet minimum capital requirements could result in certain mandatory and possible additional discretionary actions by regulators that, if undertaken, could have an adverse material effect on Mechanics’ financial condition and results of operations. The application of more stringent capital requirements could, among other things, adversely affect Mechanics’ results of operations and growth, require the raising of additional capital, restrict Mechanics’ ability to pay dividends or repurchase shares and result in regulatory actions if Mechanics were to be unable to comply with such requirements.

**Federal and state regulators periodically examine Mechanics’ business, and Mechanics may be required to remediate adverse examination findings.**

The FDIC and the CDFPI periodically examine Mechanics’ business, including Mechanics’ compliance with laws and regulations. If, as a result of an examination, a regulatory agency were to determine that Mechanics’ financial condition, capital resources, asset quality, earnings prospects, management, liquidity or other aspects of any of Mechanics’ operations had become unsatisfactory, or that Mechanics was in violation of any law or regulation, they may take a number of different remedial actions as they deem appropriate. These actions include the power to enjoin “unsafe or unsound” practices, to require affirmative action to correct any conditions resulting from any violation or practice, to issue an administrative order that can be judicially enforced, to direct an increase in Mechanics’ capital, to restrict Mechanics’ growth, to assess civil money penalties