Company: BCTF
Filing Date: 2025-03-06
Form Type: 10-K
Source: 0001552781-25-000058
Chunk: 236

Company: Bancorp 34, Inc.
Filing Date: 2025-03-06
Form: 10-K
Item: Item 1A
Chunk 236
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 could be required to begin increasing interest rates again. Increases in interest rates in the
past have led to recessions of various lengths and intensities and might lead to such a recession in the near future. Such a recession
or any other adverse changes in business and economic conditions generally or specifically in the markets in which we operate could affect
our business, including causing one or more of the following negative developments:

    ·
    an increase in our deposit and funding costs;

    ·
    a decrease in the demand for loans and other products
    and services we offer;

    ·
    a decrease in our deposit account balances as
    customers move funds to seek to obtain maximum federal deposit insurance coverage or to seek higher interest rates;

    ·
    a decrease in the value of the collateral securing
    our residential or commercial real estate loans;

    ·
    a permanent impairment of our assets; or

    ·
    an increase in the number of customers or other
    counterparties who default on their loans or other obligations to us, which could result in a higher level of nonperforming assets,
    net charge-offs, and provision for credit losses.

Inflationary
pressures present a potential threat to our results of operation and financial condition.

The United States generally
and the regions in which we operate specifically have in recent years experienced significant inflationary pressures, evidenced by higher
gas prices, higher food prices and higher prices for other consumer items. Accordingly, while inflation has since moderated, it can result
in material adverse effects upon our customers, their businesses and, as a result, our financial position and results of operation. Inflation
also can and does generally lead to higher interest rates, which have their own separate risks. Decreased deposit balances could result
in our reliance upon higher cost funding sources. See Lending and Interest
Rate Risks included in these Risk Factors below.

The
Federal Reserve has implemented significant economic strategies that have affected interest rates, inflation, asset values, and the shape
of the yield curve. These strategies have had, and will continue to have, a significant impact on our business and on many of our clients.

To illustrate: in response
to the recession in 2008-09 and the following uneven recovery, the Federal Reserve implemented a series of domestic monetary initiatives
designed to lower rates and make credit easier to obtain. The Federal Reserve changed course in 2015, raising rates several times through
2018. The last raise in 2018 was