VANCOUVER, Wash., May 4, 2006 (PRIMEZONE) -- Riverview Bancorp, Inc. (Nasdaq:RVSB) today reported that an expanding net interest margin, coupled with excellent organic loan and core deposit growth and the contribution from the American Pacific Bank acquisition generated a 43% increase in net interest income for the fiscal year ended March 31, 2006. Net income increased 49% to $9.7 million, or $1.72 per diluted share, in fiscal 2006, compared to $6.5 million, or $1.33 per diluted share, in fiscal 2005. Net income for the fourth fiscal quarter increased 56% to $2.6 million, or $0.46 per diluted share, compared to $1.7 million, or $0.34 per diluted share, in the same quarter a year ago.
In fiscal 2005, the prior year, the Company recorded a non-cash, non-operating charge of approximately $890,000 after-tax, or $0.18 per diluted share, related to the valuation of certain Fannie Mae and Freddie Mac preferred stocks, which were subsequently sold. Excluding the securities loss, net income would have been $7.3 million, or $1.49 per diluted share in fiscal 2005.
In the first quarter of fiscal 2006, Riverview completed the acquisition of American Pacific Bank with $128 million in assets.
"Fiscal 2006 has been an outstanding year for Riverview. We have successfully grown our balance sheet while improving asset quality, net interest margin and we continue to grow our franchise," said Pat Sheaffer, Chairman and CEO. "The acquisition of American Pacific Bank was accretive within the first year and has been an excellent expansion into the Portland market for us. In addition to the three acquired branches, we opened our operations center and the tenth Clark County, Washington branch, bringing our branch network to 17 locations. We will continue our growth in the Portland Vancouver metropolitan area, where we expect to open at least one new bank facility later this year."
Fourth Quarter Financial Highlights (at or periods ended March 31, 2006, compared to March 31, 2005)
-- Net income increased 56% to $2.6 million.
-- Non-performing assets were just 0.05% of total assets,
compared to 0.13% of total assets a year ago.
-- Net interest income increased 51% to $8.6 million.
-- Revenues increased 41% to $10.6 million.
-- Net interest margin increased 59 basis points to 5.24%
compared to 4.65% a year ago.
-- Deposits grew 33% to $607 million.
-- Total assets increased 33% to $764 million.
-- Loans increased 45% to $623 million.
Operating Results
For fiscal 2006 net interest margin improved 29 basis points to 5.03% compared to 4.74% a year earlier. "Our asset sensitive balance sheet and growth in loans has once again helped us expand our margin for the quarter and the year," said Ron Wysaske, President and COO. "We expect our margin to continue to benefit in a rising or stable short term interest rate environment."
Revenues (net interest income before the provision for loan losses plus non-interest income) increased 42% to $41.2 million in fiscal 2006, compared to $29.1 million a year ago. Net interest income before the provision for loan losses increased 43% to $32.4 million in fiscal year 2006 compared to $22.6 million in fiscal year 2005. Non-interest income increased 13% to $8.8 million in fiscal 2006 compared to $7.8 million in fiscal 2005 excluding the $1.3 pre-tax million impairment charge.
In the fourth quarter, revenues increased 41% to $10.6 million compared to $7.5 million in the fourth quarter a year ago. Net interest income before the provision for loan loss increased 51% to $8.6 million in the fourth quarter of fiscal 2006 compared to $5.7 million in the fourth quarter a year ago. Non-interest income increased 10% to $2.0 million in the fourth quarter compared to $1.8 million in the prior year's fourth quarter. This increase was largely due to the 19% increase in fee based transaction accounts income and mortgage broker activity, which contributed $1.4 million to fourth quarter revenue, compared to $1.1 million in the same quarter a year ago.
Fiscal 2006 non-interest expense increased 33% to $25.4 million compared to $19.1 million for fiscal 2005, reflecting the branch network expansion. For the fiscal fourth quarter, non-interest expense increased 40% to $6.9 million compared to $4.9 million a year earlier. Salaries and employee benefits increased approximately $3.8 million over last year primarily due to new and acquired branch and lending personnel and the rising costs of healthcare benefits. Net of intangible amortization, the efficiency ratio that measures operating expenses, as proportion of revenue was 63.76% for the quarter, compared to 64.02% in 2005's fourth fiscal quarter. For the fiscal year, the efficiency ratio, net of intangible amortization and last year's impairment charge improved to 60.79% compared to 61.63% in fiscal 2005.
Balance Sheet Growth
"Our loan portfolio has seen significant expansion in the past year while maintaining exceptional loan quality. 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 the coming year," said Wysaske. Net loans at March 31, 2006, increased 45% to $623 million compared to $429 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 33% to $764 million at March 31, 2006, compared to $573 million a year ago. Total deposits grew 33% to $607 million compared to $457 million at March 31, 2005. Core deposits increased 30%, or $92.3 million; from year ago levels, and now account for 66 % of total deposits.
Including the issuance of $16.7 million in stock associated with the American Pacific Bank acquisition, shareholders' equity increased 32% to $91.7 million compared to $69.5 million at the end of fiscal 2005. Book value per share was $15.88 at March 31, 2006, compared to $14.35 a year earlier and tangible book value per share was $11.23 at fiscal year-end compared to $12.24 a year ago.
Riverview completed the issuance of $7.0 million in trust preferred securities in the third fiscal quarter 2006. The net proceeds will provide additional capital for general corporate purposes, including current and future expansion of the Bank. Under the terms of the transaction, the trust preferred securities have a maturity of 30 years and are redeemable at par after five years. The securities require quarterly interest payments (subject to certain deferment options) and bear an interest rate tied to three-month LIBOR, plus 1.36%.
Credit Quality and Performance Measures
Credit quality remains pristine, as non-performing assets improved to just 0.05% of total assets at March 31, 2006, compared to a low 0.13% of total assets at March 31, 2005. The allowance for loan losses including loan commitments was $7.2 million, or 1.20% of net loans at fiscal year-end, compared to $4.4 million or 1.07% of net loans a year ago. "With the strong growth in the loan portfolio this year, we increased our provision for loan losses to $1.5 million in fiscal 2006 from $410,000 in fiscal 2005."
Riverview's fiscal 2006 return on average assets was 1.36%, compared to 1.40% in fiscal 2005, excluding the impairment charge and return on average equity was 10.95% for the year, compared to 10.87% for fiscal 2005, excluding the impairment charge.
Conference Call
Riverview Bancorp will host a conference call Friday, May 5, at 8:00 a.m. PDT, to discuss fiscal year-end 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 32958. An archived recording of the call can be accessed by dialing 303-590-3000 access code 11057072# until Friday, May 12, 2006 or via the Internet at www.actioncast.acttel.com and use event ID 32958.
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 $764 million, it is the parent company of the 82 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 integrate the American Pacific acquisition and 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
March 31, 2006 and 2005
(In thousands, except share data) MARCH 31, MARCH 31,
(Unaudited) 2006 2005
---------------------------------------------------------------------
ASSETS
Cash (including interest-earning accounts
of $7,786 and $45,501) $ 31,346 $ 61,719
Loans held for sale 65 510
Investment securities available for sale,
at fair value (amortized cost of
$24,139 and $22,993) 24,022 22,945
Mortgage-backed securities held to maturity,
at amortized cost (fair value of $1,830 and
$2,402) 1,805 2,343
Mortgage-backed securities available for
sale, at fair value (amortized cost of
$8,436 and $11,756) 8,134 11,619
Loans receivable (net of allowance for
loan losses of $7,221 and $4,395) 623,016 429,449
Real estate owned -- 270
Prepaid expenses and other assets 2,210 1,538
Accrued interest receivable 3,058 2,151
Federal Home Loan Bank stock, at cost 7,350 6,143
Premises and equipment, net 19,127 8,391
Deferred income taxes, net 3,771 2,624
Mortgage servicing intangible, net 384 470
Goodwill 25,572 9,214
Core deposit intangible, net 895 578
Bank owned life insurance 13,092 12,607
--------- ---------
TOTAL ASSETS $ 763,847 $ 572,571
========= =========
LIABILITIES AND SHAREHOLDERS' EQUITY
LIABILITIES:
Deposit accounts $ 606,964 $ 456,878
Accrued expenses and other liabilities 11,521 5,858
Advance payments by borrowers for taxes
and insurance 358 313
Federal Home Loan Bank advances 46,100 40,000
Junior subordinated debenture 7,217 --
--------- ---------
Total liabilities 672,160 503,049
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' EQUITY:
Serial preferred stock, $.01 par value;
250,000 authorized, issued and outstanding,
none -- --
Common stock, $.01 par value;
50,000,000 authorized
2006 - 5,772,690 issued,
5,772,686 outstanding 57 50
2005 - 5,015,753 issued,
5,015,749 outstanding
Additional paid-in capital 57,316 41,112
Retained earnings 35,776 29,874
Unearned shares issued to employee stock
ownership trust (1,186) (1,392)
Accumulated other comprehensive loss (276) (122)
--------- ---------
Total shareholders' equity 91,687 69,522
--------- ---------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 763,847 $ 572,571
========= =========
RIVERVIEW BANCORP, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF INCOME FOR
THE THREE AND TWELVE MONTHS ENDED
MARCH 31, 2006 AND 2005
(In thousands, except share data) (Unaudited)
Three Months Ended Twelve Months Ended
March 31, March 31,
2006 2005 2006 2005
---------------------------------------------------------------------
INTEREST INCOME:
Interest and fees on
loans receivable $ 12,649 $ 7,258 $ 45,039 $ 27,764
Interest on investment
securities-taxable 217 154 809 521
Interest on investment
securities-non-taxable 42 43 170 174
Interest on mortgage-
backed securities 119 152 530 634
Other interest and
dividends 51 242 681 875
--------- --------- --------- ---------
Total interest income 13,078 7,849 47,229 29,968
--------- --------- --------- ---------
INTEREST EXPENSE:
Interest on deposits 3,563 1,639 12,383 5,380
Interest on borrowings 899 506 2,494 2,015
--------- --------- --------- ---------
Total interest expense 4,462 2,145 14,877 7,395
--------- --------- --------- ---------
Net interest income 8,616 5,704 32,352 22,573
Less provision for
loan losses 200 150 1,500 410
--------- --------- --------- ---------
Net interest income
after provision for
loan losses 8,416 5,554 30,852 22,163
--------- --------- --------- ---------
NON-INTEREST INCOME:
Fees and service charges 1,369 1,149 5,913 4,588
Asset management fees 397 305 1,481 1,120
Gain on sale of loans
held for sale 77 104 361 513
Gain (loss) on sale/im-
pairment of securities -- 164 -- (1,185)
Loan servicing income 23 2 91 47
Gain on sale of land
and fixed assets 2 1 2 830
Gain on sale of credit
card portfolio -- -- 311 --
Bank owned life insurance 124 86 485 486
Other 33 34 193 107
--------- --------- --------- ---------
Total non-interest
income 2,025 1,845 8,837 6,506
--------- --------- --------- ---------
NON-INTEREST EXPENSE:
Salaries and employee
benefits 4,015 2,744 14,536 10,773
Occupancy and
depreciation 1,158 730 3,798 2,991
Data processing 341 251 1,414 991
Amortization of core
deposit intangible 53 33 210 180
Advertising and
marketing expense 156 128 853 766
FDIC insurance premium 19 14 70 58
State and local taxes 161 128 580 519
Telecommunications 116 75 395 288
Professional fees 328 447 1,328 842
Other 522 365 2,190 1,696
--------- --------- --------- ---------
Total non-interest
expense 6,869 4,915 25,374 19,104
--------- --------- --------- ---------
INCOME BEFORE INCOME TAXES 3,572 2,484 14,315 9,565
PROVISION FOR INCOME TAXES 965 816 4,577 3,036
--------- --------- --------- ---------
NET INCOME $ 2,607 $ 1,668 $ 9,738 $ 6,529
========= ========= ========= =========
Earnings per common share:
Basic $ 0.46 $ 0.34 $ 1.74 $ 1.36
Diluted 0.46 0.34 1.72 1.33
Weighted average number
of shares outstanding:
Basic 5,640,189 4,839,523 5,602,240 4,816,745
Diluted 5,725,222 4,913,825 5,675,168 4,891,173
RIVERVIEW BANCORP, INC. AND SUBSIDIARY
FINANCIAL HIGHLIGHTS
(Unaudited)
At or for At or for
the year ended the year ended
March 31, March 31,
2006 2005
----------- -----------
(Dollars in thousands,
FINANCIAL CONDITION DATA except share data)
------------------------
Average interest-earning assets $ 645,084 $ 479,512
Average interest-bearing liabilities 532,521 388,426
Non-performing assets 415 726
Non-performing loans 415 456
Allowance for loan losses 7,221 4,395
Average interest-earning assets to
average interest-bearing liabilities
121.14% 123.45%
Allowance for loan losses to
non-performing loans 1,740.00% 963.82%
Allowance for loan losses to net loans 1.15% 1.01%
Allowance for loan losses to net loans
and loan commitments 1.20% 1.07%
Non-performing loans to total net loans 0.07% 0.10%
Non-performing assets to total assets 0.05% 0.13%
Shareholders' equity to assets 12.00% 12.14%
Number of banking facilities 17 14
At nine
At year ended months ended At year ended
March 31, December 31, March 31,
LOAN DATA 2006 2005 2005
--------- -------- -------- --------
Residential:
One-to-four-family $ 32,129 $ 31,985 $ 36,059
Multi-family 2,127 2,102 2,537
Construction:
One-to-four-family 81,167 75,058 43,633
Commercial real estate 46,135 36,622 10,982
Commercial 59,769 62,138 57,981
Consumer:
Secured 29,943 30,069 28,951
Unsecured 1,415 1,617 1,668
Land 49,174 49,990 28,889
Commercial real estate 328,378 317,103 223,144
-------- -------- --------
630,237 606,684 433,844
Less:
Allowance for loan losses 7,221 7,050 4,395
-------- -------- --------
Loans receivable, net $623,016 $599,634 $429,449
======== ======== ========
DEPOSIT DATA
------------
Now Accounts $ 62,941 $ 75,806 $ 65,667
High Yield Checking 66,516 60,412 50,562
Regular Savings 38,344 40,187 35,513
Money Market 137,451 125,668 76,331
Non-Interest Checking 94,592 91,514 79,499
Certificates of Deposit 207,120 198,621 149,306
-------- -------- --------
Total Deposits $606,964 $592,208 $456,878
======== ======== ========
RIVERVIEW BANCORP, INC. AND SUBSIDIARY
FINANCIAL HIGHLIGHTS
(UNAUDITED)
For the For the
Three months ended Twelve months ended
March 31, March 31,
SELECTED OPERATING DATA 2006 2005 2006 2005
----------------------- ------- ------- ------- -------
Efficiency ratio (d) 64.55% 65.11% 61.60% 65.70%
Efficiency ratio net of
intangible amortization 63.76% 64.02% 60.79% 64.46%
Efficiency ratio net of
intangible amortization
and impairment charge 63.76% 64.02% 60.79% 61.63%
Coverage ratio (f) 125.43% 116.05% 127.50% 118.16%
Coverage ratio net of
intangible amortization 126.41% 116.84% 128.56% 119.28%
Return on average
assets (a) 1.42% 1.23% 1.36% 1.24%
Return on average assets
excluding impairment
charge 1.42% 1.23% 1.36% 1.40%
Return on average
equity (a) 11.42% 9.65% 10.95% 9.56%
Return on average equity
excluding impairment
charge 11.42% 9.65% 10.95% 10.87%
Average rate earned on
interest-earning assets 7.95% 6.39% 7.34% 6.28%
Average rate paid on
interest-bearing
liabilities 3.26% 2.16% 2.79% 1.90%
Spread (g) 4.69% 4.23% 4.55% 4.38%
Net interest margin 5.24% 4.65% 5.03% 4.74%
At or for the At or for the
Three months ended Twelve months ended
March 31, March 31,
2006 2005 2006 2005
--------- --------- --------- ---------
PER SHARE DATA
--------------
Basic earnings per
share (b) $ 0.46 $ 0.34 $ 1.74 $ 1.36
Diluted earnings per
share (c) 0.46 0.34 1.72 1.33
Book value per share (e) 15.88 14.35 15.88 14.35
Tangible book value per
share (e) 11.23 12.24 11.23 12.24
Market price per share:
High for period 27.500 22.480 27.500 22.500
Low for the period 23.120 21.000 20.330 19.490
Close for period end 26.760 21.250 26.760 21.250
Cash dividends declared
per share 0.170 0.155 0.680 0.620
Average number of
shares outstanding:
Basic (b) 5,640,189 4,839,523 5,602,240 4,816,745
Diluted (c) 5,725,222 4,913,825 5,675,168 4,891,173
--------- --------- --------- ---------
(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 plus
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.