VANCOUVER, Wash., July 25, 2006 (PRIMEZONE) -- Riverview Bancorp, Inc. (Nasdaq:RVSB) today reported that an expanded net interest margin, coupled with excellent loan growth, generated a 44% increase in net income for the first fiscal quarter of 2007 ended June 30, 2006. Net income for the first quarter increased to $2.6 million, or $0.46 per diluted share, compared to $1.8 million, or $0.33 per diluted share, in the first quarter of fiscal 2006.
The management team of Riverview Bancorp will host a conference call on Wednesday, July 26, at 8:00 a.m. PDT, to discuss first quarter results. The conference call can be accessed live by telephone at 303-262-2130. To listen to the call online go to www.actioncast.acttel.com and use event ID 34421.
"Over the past year we have continued to grow our balance sheet by attracting core deposits in a competitive marketplace and building our loan portfolio to reflect that of a commercial bank. The success of these initiatives, coupled with the continuing benefits from our expansion into the Portland market by acquiring American Pacific Bank, has helped generate double digit profit growth," said Pat Sheaffer, Chairman and CEO. The acquisition was completed on April 22, 2005, therefore the first quarter a year ago contains two months of contribution from American Pacific.
First Quarter Financial Highlights (at or for periods ended June 30, 2006, compared to June 30, 2005) ------------------------------------------------------------------ - Net income increased 44% to $2.6 million. - Net interest income increased 27% to $9.0 million. - Revenues increased 20% to $11.1 million. - Cash dividend increased 12% to $0.19 per share. - Net interest margin increased 53 basis points to 5.23% compared to 4.70% a year ago. - Efficiency ratio improved to 60.83%. - Total assets increased 8% to $793 million. - Non-performing assets improved to 0.15% of total assets, compared to 0.33% a year ago. - Loans increased 17% to $659 million.
Operating Results
For first fiscal quarter 2007 net interest margin was 5.23%, compared to 5.24% for the immediate prior quarter and improved from 4.70% for the first fiscal quarter a year ago. "Although we saw strong loan growth for the first quarter, our net interest margin remained stable," said Sheaffer. "We expect our margin to remain steady in future quarters given the current short term interest rate environment."
In the first quarter, revenues increased 20% to $11.1 million, compared to $9.3 million in the first quarter a year ago. Net interest income before the provision for loan loss increased 27% to $9.0 million in the first quarter of fiscal 2007, compared to $7.1 million in the first quarter a year ago. Non-interest income declined slightly to $2.1 million in the first quarter compared to $2.2 million in the prior year's first quarter. Higher fees for asset management partially offset lower fees for transaction accounts and the gain from the sale of the credit card portfolio helped offset lower gains on the sale of loans due to reduced mortgage broker activity.
Fiscal first quarter non-interest expense was $6.8 million, compared to $6.1 million for the same period a year earlier. "The majority of the increase in operating costs is a result of the additional branch opened during the year, a full quarter of expenses from our new Portland area branches, the expansion of our lending team and the rising costs of employee benefits," said Ron Wysaske, President and COO. Salaries and employee benefits increased 13% to $3.8 million from $3.4 million a year ago. The efficiency ratio, which measures operating expenses as proportion of revenue, improved to 60.83% for the quarter, compared to 65.65% in 2006's first fiscal quarter.
Balance Sheet Growth
"Our lending team has done an excellent job of growing the loan portfolio and adding to the loan pipeline while maintaining exceptional loan quality. For the linked quarter, loans were up $35.9 million, or 23% annualized, as a result of their efforts," said Wysaske. "We anticipate continued high growth throughout Southwest Washington and the greater Portland metropolitan area, which should continue to fuel double digit growth in our loan portfolio. In fact, Marple's Pacific Northwest Letter stated in the June 21, 2006 issue that, `The economy of the Pacific Northwest in fact is booming -- growing at the fastest rate since before the recession in 2001.' This puts us in an enviable position." Net loans at June 30, 20006, increased 17% to $659 million compared to $561 million a year ago. Commercial real estate loans now account for 59% of the total loan portfolio and permanent single family loans represents just 5% of Riverview's loan portfolio.
Total assets increased 8% to $793 million at June 30, 2006, compared to $738 million a year ago. Total deposits grew 4% to $607 million, compared to $583 million at June 30, 2005. Core deposits, which increased 7% from year ago levels, account for 67 % of total deposits. "As interest rates have increased, we have seen a greater demand for higher-yielding checking," noted Wysaske. "Non-interest checking balances also grew 22% to $97 million, or 16% of total deposits, and money market accounts grew 6% to $134 million, or 22% of total deposits."
Shareholders' equity increased 7% to $93.5 million, compared to $87.4 million at the end of the first fiscal quarter a year ago. Book value per share was $16.17 at June 30, 2006, compared to $15.06 a year earlier, and tangible book value per share was $11.54 at quarter-end, compared to $10.25 at quarter-end a year earlier.
Credit Quality and Performance Measures
Credit quality remains strong, with non-performing assets improving to just 0.15% of total assets at June 30, 2006, compared to 0.33% of total assets at June 30, 2005. The allowance for loan losses including unfunded loan commitments was $8.0 million, or 1.20% of net loans at quarter-end, compared to $6.9 million, or 1.21% of net loans, a year ago.
Riverview's fiscal first quarter 2007 return on average assets improved to 1.36%, compared to 1.09% for fiscal first quarter 2006. Return on average equity improved to 11.18% for the quarter, compared to 8.89% for the first quarter a year ago.
About the Company
Riverview Bancorp, Inc. (www.riverviewbank.com) is headquartered in Vancouver, Washington -- just north of Portland, Oregon on the I-5 corridor. With assets of $793 million, it is the parent company of the 83 year-old Riverview Community Bank, as well as Riverview Mortgage and Riverview Asset Management Corp. There are 17 branches, including ten in fast growing Clark County, three in the Portland metropolitan area and three lending centers. The Bank offers true community banking services, focusing on providing the highest quality service and financial products to commercial and retail customers.
Statements concerning future performance, developments or events, concerning expectations for growth and market forecasts, and any other guidance on future periods, constitute forward-looking statements, which are subject to a number of risks and uncertainties that might cause actual results to differ materially from stated objectives. These factors include but are not limited to: RVSB's ability to acquire shares according to internal repurchase guidelines, regional economic conditions and the company's ability to efficiently manage expenses. Additional factors that could cause actual results to differ materially are disclosed in Riverview Bancorp's recent filings with the SEC, including but not limited to Annual Reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K.
RIVERVIEW BANCORP, INC. AND SUBSIDIARY
Consolidated Balance Sheets
June 30, 2006, March 31, 2006 and June 30, 2005
(In thousands, except share data)
(Unaudited) June 30, March 31, June 30,
2006 2006 2005
---------------------------------------------------------------------
ASSETS
Cash (including interest-earning
accounts of $6,754, $7,786 and
$52,262) $ 26,671 $ 31,346 $ 74,485
Loans held for sale -- 65 159
Investment securities available
for sale, at fair value (amortized
cost of $23,005, $24,139 and
$24,136) 22,847 24,022 24,148
Mortgage-backed securities held to
maturity, at amortized cost (fair
value of $1,603, $1,830 and $2,297) 1,580 1,805 2,260
Mortgage-backed securities available
for sale, at fair value (amortized
cost of $8,011, $8,436 and $10,913) 7,666 8,134 10,828
Loans receivable (net of allowance
for loan losses of $7,626 $7,221
and $6,526) 658,588 623,016 561,012
Prepaid expenses and other assets 2,164 2,210 2,166
Accrued interest receivable 3,526 3,058 2,664
Federal Home Loan Bank stock,
at cost 7,350 7,350 7,350
Premises and equipment, net 19,125 19,127 9,339
Deferred income taxes, net 3,799 3,771 2,483
Mortgage servicing intangible, net 372 384 458
Goodwill 25,572 25,572 26,356
Core deposit intangible, net 845 895 1,055
Bank owned life insurance 13,220 13,092 12,726
-------- -------- --------
TOTAL ASSETS $793,325 $763,847 $737,489
======== ======== ========
LIABILITIES AND SHAREHOLDERS'
EQUITY
LIABILITIES:
Deposit accounts $607,389 $606,964 $582,830
Accrued expenses and other
liabilities 9,062 8,768 8,259
Advance payments by borrowers for
taxes and insurance 144 358 98
Federal Home Loan Bank advances 73,300 46,100 58,904
Junior subordinated debenture 7,217 7,217 --
Capital lease obligation 2,745 2,753 --
-------- -------- --------
Total liabilities 699,857 672,160 650,091
SHAREHOLDERS' EQUITY:
Serial preferred stock, $.01 par
value; 250,000 authorized,
issued and outstanding, none -- -- --
Common stock, $.01 par value;
50,000,000 authorized, June 30,
2006 - 5,780,090 issued,
5,780,086 outstanding; March 31,
2006 - 5,772,690 issued,
5,772,686 outstanding; June 30,
2005 - 5,804,953 issued,
5,804,949 outstanding 57 57 58
Additional paid-in capital 57,529 57,316 57,991
Retained earnings 37,348 35,776 30,737
Unearned shares issued to employee
stock ownership trust (1,134) (1,186) (1,340)
Accumulated other comprehensive loss (332) (276) (48)
-------- -------- --------
Total shareholders' equity 93,468 91,687 87,398
-------- -------- --------
TOTAL LIABILITIES AND SHAREHOLDERS'
EQUITY $793,325 $763,847 $737,489
======== ======== ========
RIVERVIEW BANCORP, INC. AND SUBSIDIARY
Consolidated Statements of Income for the Three Months
Ended June 30, 2006 and 2005
(In thousands, except share data) Three Months Ended
(Unaudited) June 30,
2006 2005
---------------------------------------------------------------------
INTEREST INCOME:
Interest and fees on loans receivable $ 13,769 $ 9,597
Interest on investment securities-taxable 221 186
Interest on investment securities-non taxable 42 43
Interest on mortgage-backed securities 114 145
Other interest and dividends 52 254
---------- ----------
Total interest income 14,198 10,225
---------- ----------
INTEREST EXPENSE:
Interest on deposits 4,222 2,471
Interest on borrowings 963 656
---------- ----------
Total interest expense 5,185 3,127
---------- ----------
Net interest income 9,013 7,098
Less provision for loan losses 350 450
---------- ----------
Net interest income after provision
for loan losses 8,663 6,648
---------- ----------
NON-INTEREST INCOME:
Fees and service charges 1,331 1,486
Asset management fees 436 364
Gain on sale of loans held for sale 72 126
Gain on sale of real estate owned -- 21
Loan servicing income 45 27
Gain on sale of credit card portfolio 67 --
Bank owned life insurance income 128 120
Other 36 43
---------- ----------
Total non-interest income 2,115 2,187
---------- ----------
NON-INTEREST EXPENSE:
Salaries and employee benefits 3,835 3,399
Occupancy and depreciation 1,074 803
Data processing 335 365
Amortization of core deposit intangible 50 49
Advertising and marketing expense 302 231
FDIC insurance premium 24 15
State and local taxes 155 135
Telecommunications 112 63
Professional fees 178 363
Other 704 673
---------- ----------
Total non-interest expense 6,769 6,096
---------- ----------
INCOME BEFORE INCOME TAXES 4,009 2,739
PROVISION FOR INCOME TAXES 1,378 918
---------- ----------
NET INCOME $ 2,631 $ 1,821
========== ==========
Earnings per common share:
Basic $ 0.47 $ 0.33
Diluted $ 0.46 $ 0.33
Weighted average number of shares
outstanding:
Basic 5,637,604 5,389,547
Diluted 5,725,909 5,457,270
RIVERVIEW BANCORP, INC. AND SUBSIDIARY
FINANCIAL HIGHLIGHTS
(Unaudited) At or for At or for the
the three months Year ended
ended June 30, March 31,
2006 2005 2006
-------- -------- --------
(Dollars in thousands, except share data)
FINANCIAL CONDITION DATA
------------------------
Average interest-
earning assets $692,283 $608,973 $645,084
Average interest-
bearing liabilities 574,714 505,581 532,521
Net average earning assets 117,569 103,392 112,563
Non-performing assets 1,173 2,420 415
Non-performing loans 1,173 2,420 415
Allowance for loan losses 7,626 6,526 7,221
Allowance for loan losses
and unfunded loan commitments 8,002 6,855 7,583
Average interest-earning
assets to average interest-
bearing liabilities 120.46% 120.45% 121.14%
Allowance for loan losses to
non-performing loans 650.13% 269.67% 1740.00%
Allowance for loan losses to
net loans 1.14% 1.15% 1.15%
Allowance for loan losses and
unfunded loan commitments to
net loans 1.20% 1.21% 1.20%
Non-performing loans to total
net loans 0.18% 0.43% 0.07%
Non-performing assets to
total assets 0.15% 0.33% 0.05%
Shareholders' equity to assets 11.78% 11.85% 12.00%
Number of branch banking
facilities 17 16 17
At or for At or for the
the three months Year ended
ended June 30, March 31,
2006 2005 2006
LOAN DATA -------- -------- --------
---------
Residential:
One-to-four family $ 32,668 $ 34,324 $ 32,553
Multi-family 3,226 2,037 2,157
Construction: 87,040 48,932 81,572
One-to-four family
Commercial real estate 50,387 29,390 47,079
Commercial 66,474 67,239 59,834
Consumer:
Secured 30,961 29,040 29,781
Unsecured 926 4,811 1,415
Land 56,705 36,924 49,558
Commercial real estate 342,174 318,631 330,705
-------------------------------------------------------------------
670,561 571,328 634,654
Less:
Deferred loan fees 4,347 3,790 4,352
Allowance for loan losses 7,626 6,526 7,221
-------------------------------------------------------------------
Loans receivable, net $658,588 $561,012 $623,081
===================================================================
DEPOSIT DATA
------------
Now Accounts $ 62,631 $ 88,368 $ 62,941
High Yield Checking 81,489 52,380 66,516
Regular Savings 34,871 37,613 38,344
Money Market 134,010 126,948 137,451
Non-Interest Checking 96,636 79,117 94,592
Certificates of Deposit 197,752 198,404 207,120
-------------------------------------------------------------------
Total Deposits $607,389 $582,830 $606,964
===================================================================
RIVERVIEW BANCORP, INC. AND SUBSIDIARY
FINANCIAL HIGHLIGHTS
(Unaudited) At or for At or for the
the three months year ended
ended June 30, March 31,
2006 2005 2006
--------- --------- ---------
SELECTED OPERATING DATA (Dollars in thousands,
----------------------- except share data)
Efficiency ratio(d) 60.83% 65.65% 61.60%
Efficiency ratio net of
intangible amortization 60.18% 64.77% 60.79%
Coverage ratio(f) 133.15% 116.44% 127.50%
Coverage ratio net of
intangible amortization 134.14% 117.38% 128.56%
Return on average assets(a) 1.36% 1.09% 1.36%
Return on average equity(a) 11.18% 8.89% 10.95%
Average rate earned on
interest-earned assets 8.24% 6.76% 7.34%
Average rate paid on
interest-bearing liabilities 3.62% 2.48% 2.79%
Spread(g) 4.62% 4.28% 4.55%
Net interest margin 5.23% 4.70% 5.03%
PER SHARE DATA
--------------
Basic earnings per share(b) $ 0.47 $ 0.34 $ 1.74
Diluted earnings per share(c) 0.46 0.33 1.72
Book value per share(e) 16.17 15.06 15.88
Tangible book value per share(e) 11.54 10.25 11.23
Market price per share:
High for the period 27.05 21.80 27.50
Low for the period 24.27 20.33 20.33
Close for period end 26.20 21.35 26.76
Cash dividends declared per share 0.19 0.17 0.68
Average number of
shares outstanding:
Basic(b) 5,637,604 5,389,547 5,602,240
Diluted(c) 5,725,909 5,457,270 5,675,168
(a) Amounts are annualized.
(b) Amounts calculated exclude ESOP shares not committed to be
released.
(c) Amounts calculated exclude ESOP shares not committed to be
released and include common stock equivalents.
(d) Non-interest expense divided by net interest income and
non-interest income.
(e) Amounts calculated include ESOP shares not committed to be
released.
(f) Net interest income divided by non-interest expense.
(g) Yield on interest-earning assets less cost of funds on
interest bearing liabilities.