Bar Harbor Bankshares(US:BHB)2024-11-07 21:59Interest Rate Risk Management - As of September 30, 2024, the bank's net interest income sensitivity analysis indicates a potential deterioration of $5,070,000 (4.1%) over the next 12 months if interest rates decline by 200 basis points [274]. - If interest rates increase by 200 basis points, net interest income is expected to improve by $5,162,000 (4.2%) over the next 12 months [275]. - The bank's balance sheet was asset sensitive over the one- and two-year horizons as of September 30, 2024, indicating increased asset sensitivity compared to the previous year [274]. - The bank's Asset Liability Management Policy establishes interest rate risk limits to control variability of net interest income under different rate scenarios [269]. - Interest rate risk management is overseen by the Asset and Liability Committee (ALCO), which meets regularly to review balance sheet structure and formulate strategies [266]. - The bank utilizes a widely recognized interest rate risk model to simulate the behavior of interest income and expense under various interest rate scenarios [270]. - As of September 30, 2023, a 200 basis point decline in interest rates would result in a deterioration of net interest income by $4,125,000 (3.2%) over the next 12 months [278]. - The bank's interest rate risk sensitivity modeling incorporates various assumptions about the balance sheet's evolution and interest rate environments [271]. Internal Control and Litigation - There were no changes in internal control over financial reporting that materially affected the bank's financial reporting during the last fiscal quarter [281]. - Management believes the likelihood of adverse effects from ongoing litigation is remote, but acknowledges potential costs and reputational impacts [282].