Negative Cash FlowsPersistent negative operating and free cash flows limit the bank's ability to fund lending, capital expenditures, and distributions from internally generated cash. This forces reliance on external funding or asset sales, increasing liquidity and refinancing risk over the medium term.
Compressing Operational MarginsMaterial declines in operating margins point to rising costs or margin pressure from funding and competition. If structural, margin compression will erode profitability and retained earnings, necessitating efficiency measures or strategic shifts to restore durable earning power.
Low Equity RatioA relatively low equity ratio increases sensitivity to loan losses and regulatory capital needs, constraining organic balance-sheet growth. Over months, this can limit the bank's ability to expand lending or pursue initiatives without raising capital, reducing strategic flexibility.