VANCOUVER, Wash., Jan. 23, 2007 (PRIME NEWSWIRE) -- Riverview Bancorp, Inc. (Nasdaq:RVSB) today reported that loan and deposit growth coupled with a continued focus on operating efficiencies contributed to record profits for the third fiscal quarter of 2007. Net income for the third fiscal quarter increased 18% to $3.2 million, or $0.28 per diluted share, compared to $2.7 million, or $0.24 per diluted share, in the third fiscal quarter a year ago. For the first nine months of fiscal 2007, net income increased 24% to $8.8 million, or $0.77 per diluted share, compared to $7.1 million, or $0.63 per diluted share, in the first nine months a year ago. All per share data has been adjusted to reflect the August 2006 2-for-1 stock split.
"We have generated both top and bottom line improvements, with revenues increasing 10%, loans expanding 16% and net income improving 18% from year ago levels," said Pat Sheaffer, Chairman and CEO. "We are achieving our profit goals by delivering excellent customer service while maintaining solid asset quality. The exceptional growth throughout the Southwest Washington and greater Portland metropolitan area, which is led by manufacturing, technology and service industries, is fueling our balance sheet growth and has helped generate our double-digit profit growth."
Third Quarter Financial Highlights (at or for periods ended December 31, 2006, compared to December 31, 2005)
* Net income increased 18% to $3.2 million. * Net interest income increased 9% to $9.3 million. * Revenues advanced 10% to $11.7 million. * Net interest margin was 4.89%. * Efficiency ratio improved to 55.09%. * Total assets increased 13% to $836 million. * Loans increased 16% to $697 million. * Riverview Asset Management Corp. assets under management increased 31% to $288 million. * Asset management fees increased 33% to $504 million.
Operating Results
For the first nine months of fiscal 2007, net interest margin improved seven basis points to 5.03% compared to 4.96% for the same period a year ago. The net interest margin compressed to 4.89% for the third fiscal quarter, compared to 5.23% in the third fiscal quarter a year ago, and 4.97% in the prior linked quarter. "Our margin compression for the quarter primarily resulted from an increase in funding costs, which outpaced the increased yield on interest earning assets," said Ron Wysaske, President and COO. "The flat or inverted yield curve remains a challenge for us as well as the entire banking industry."
Revenues (net interest income before the provision for loan losses plus non-interest income) increased 10% to $11.7 million for the quarter compared to $10.7 million in the same quarter a year ago. Net interest income before the provision for loan losses increased 9% to $9.3 million in the third quarter of fiscal 2007 compared to $8.5 million in the third quarter a year ago. Non-interest income increased 12% to $2.4 million in the third fiscal quarter of 2007 compared to $2.1 million in the prior year's third quarter. The increase in non-interest income was largely due to gains in fees and service charges along with the 33% year over year growth in asset management fees from the trust company. Fee income from Riverview Asset Management Corp. increased to $504,000 in the third quarter of fiscal 2007 compared to $378,000 in the third quarter a year ago.
For the first nine months of fiscal 2007 revenues increased 12% to $34.3 million compared to $30.5 million in the nine-month period a year ago. Year-to-date, net interest income before the provision for loan losses increased 16% to $27.5 million compared to $23.7 million in the same period a year ago. Non-interest income was $6.8 million in the first nine months of fiscal 2007, even with the first nine months in fiscal 2006. Fee income for Riverview Asset Management Corp. increased 29% to $1.4 million in the nine-month period ended December 31, 2006 compared to $1.1 million in the nine- month period ended a year ago.
Non-interest expense was $6.4 million in the third quarter compared to $6.1 million in the same quarter a year ago. For the first nine months of the fiscal year, non-interest expense was $19.5 million compared to $18.5 million in the like period a year ago. The efficiency ratio improved 244 basis points to 55.1% for the quarter, compared to 57.5% in the same quarter a year ago. For the first nine months of the fiscal year, the efficiency ratio improved 368 basis points to 56.9%, compared to 60.6% in the like period a year ago. "Two factors figure into our improved efficiency. First, growing into our capacity, such as our success in Oregon has helped. Secondly, our growth in revenues due primarily to loan growth has spread our costs over a larger revenue base," said Wysaske.
Balance Sheet Growth
Net loans increased 16% to $697 million at December 31, 2006, compared to $600 million a year ago. Commercial real estate loans account for 51% of the total loan portfolio while permanent one-to-four family loans represent just 5% of the total loan portfolio. "Portfolio growth for the quarter slowed to a 4% annual growth-rate. We had some larger credits pay off just at quarter end. Our goal is to continue to keep our loan portfolio well diversified while maintaining excellent credit quality," said Sheaffer.
"We recently opened Riverview's third Portland area full service branch at 10401 NE Halsey Street, Portland, Oregon. In this location a team of six commercial lenders that moved from our Downtown Portland location will serve our east Portland and Vancouver customers," Sheaffer said.
Total assets increased 13% to $836 million at December 31, 2006, compared to $739 million a year ago. Total deposits grew 10% to $651 million, compared to $592 million at December 31, 2005. "Growing core deposits (core excludes all certificates of deposit) is a key component to our long term strategy. Core deposits now account for 68% of our total deposits," noted Wysaske. "Non-interest checking balances represent 14% of total deposits and interest checking balances represent 22% of total deposits."
Shareholders' equity increased 8% to $98.0 million, compared to $90.9 million at the end of the third fiscal quarter a year ago. Book value per share improved to $8.44 at December 31, 2006, compared to $7.82 a year earlier, and tangible book value per share was $6.14 at quarter-end, compared to $5.46 at quarter-end a year earlier.
Credit Quality and Performance Measures
Credit quality remained strong, with non-performing assets at 0.15% of total assets at December 31, 2006, compared to 0.20% of total assets at September 30, 2006 and 0.11% of total assets at December 31, 2005. The allowance for loan losses, including unfunded loan commitments of $355,000, was $9.0 million, or 1.27% of net loans at quarter-end, compared to $7.4 million, or 1.22% of net loans, a year ago.
Riverview's fiscal third quarter 2007 return on average assets improved to 1.53%, compared to 1.50% for fiscal third quarter 2006 and return on average equity improved to 13.0% for the quarter, compared to 11.9% for the same period last year. For the first nine months of fiscal 2007, return on average assets improved to 1.45% compared to 1.34% in the same period a year earlier, and return on average equity improved to 12.15% compared to 10.78% in the same period a year earlier.
Conference Call
The management team of Riverview Bancorp will host a conference call on Wednesday, January 24, at 8:00 a.m. PST, to discuss third quarter results. The conference call can be accessed live by telephone at 303-262-2140. To listen to the call online go to the "About Riverview" page of Riverview's website at www.riverviewbank.com.
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 $836 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 18 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.
RIVERVIEW BANCORP, INC. AND SUBSIDIARY
Consolidated Balance Sheets
December 31, 2006, March 31, 2006 and December 31, 2005
(In thousands, except December 31, March 31, December 31,
share data) (Unaudited) 2006 2006 2005
---------------------------------------------------------------------
ASSETS
Cash (including interest-
earning accounts of $6,197,
$7,786 and $8,338) $ 30,396 $ 31,346 $ 34,451
Loans held for sale -- 65 --
Investment securities
available for sale, at
fair value (amortized cost
of $20,650, $24,139 and
$24,124) 20,648 24,022 24,011
Mortgage-backed securities
held to maturity, at
amortized cost (fair value
of $1,356, $1,830 and
$2,013) 1,347 1,805 1,991
Mortgage-backed securities
available for sale, at
fair value (amortized cost
of $7,141, $8,436 and
$9,044) 6,977 8,134 8,791
Loans receivable (net of
allowance for loan losses
of $8,628 $7,221 and
$7,050) 697,271 623,016 599,634
Prepaid expenses and other
assets 2,105 2,210 2,103
Accrued interest receivable 4,131 3,058 3,324
Federal Home Loan Bank
stock, at cost 7,350 7,350 7,350
Premises and equipment, net 21,547 19,127 14,648
Deferred income taxes, net 3,685 3,771 2,450
Mortgage servicing
intangible, net 374 384 403
Goodwill 25,572 25,572 26,058
Core deposit intangible,
net 755 895 948
Bank owned life insurance 13,482 13,092 12,968
--------- --------- ---------
TOTAL ASSETS $ 835,640 $ 763,847 $ 739,130
========= ========= =========
LIABILITIES AND
SHAREHOLDERS' EQUITY
LIABILITIES:
Deposit accounts $ 651,197 $ 606,964 $ 592,208
Accrued expenses and other
liabilities 9,781 8,768 8,559
Advance payments by
borrowers for taxes and
insurance 123 358 146
Federal Home Loan Bank
advances 66,600 46,100 40,071
Junior subordinated
debenture 7,217 7,217 7,217
Capital Lease Obligation 2,729 2,753 --
--------- --------- ---------
Total liabilities 737,647 672,160 648,201
SHAREHOLDERS' EQUITY:
Serial preferred stock,
$.01 par value; 250,000
authorized, issued and
outstanding, none -- -- --
Common stock, $.01 par
value; 50,000,000
authorized, December 31,
2006-11,612,219 issued,
11,612,219 outstanding; 116 57 58
March 31, 2006 -
11,545,380 issued,
11,545,372 outstanding
December 31, 2005-
11,623,880 issued,
11,623,872 outstanding;
Additional paid-in capital 57,888 57,316 58,225
Retained earnings 41,232 35,776 34,125
Unearned shares issued to
employee stock ownership
trust (1,134) (1,186) (1,237)
Accumulated other
comprehensive loss (109) (276) (242)
--------- --------- ---------
Total shareholders' equity 97,993 91,687 90,929
--------- --------- ---------
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY $ 835,640 $ 763,847 $ 739,130
========= ========= =========
RIVERVIEW BANCORP, INC. AND SUBSIDIARY
Consolidated Statements of Income for the Three and Nine
Months Ended December 31, 2006 and 2005
Three Months Ended Nine Months Ended
(In thousands, except December 31, December 31,
share data) (Unaudited) 2006 2005 2006 2005
---------------------------------------------------------------------
INTEREST INCOME:
Interest and fees on
loans receivable $ 15,617 $ 11,783 $ 44,220 $ 32,390
Interest on
investment
securities-taxable 217 211 659 592
Interest on
investment
securities-non
taxable 41 42 125 128
Interest on
mortgage-backed
securities 102 128 325 411
Other interest and
dividends 101 126 249 630
----------------------- -----------------------
Total interest
income 16,078 12,290 45,578 34,151
----------------------- -----------------------
INTEREST EXPENSE:
Interest on deposits 5,548 3,290 14,678 8,820
Interest on
borrowings 1,212 457 3,442 1,595
----------------------- -----------------------
Total interest
expense 6,760 3,747 18,120 10,415
----------------------- -----------------------
Net interest income 9,318 8,543 27,458 23,736
Less provision for
loan losses 375 400 1,325 1,300
----------------------- -----------------------
Net interest income
after provision
for loan losses 8,943 8,143 26,133 22,436
----------------------- -----------------------
NON-INTEREST INCOME:
Fees and service
charges 1,535 1,460 4,315 4,544
Asset management
fees 504 378 1,395 1,084
Gain on sale of
loans held for
sale 150 81 333 284
Gain on sale of
real estate owned -- -- -- 21
Loan servicing
income 44 49 125 68
Gain on sale of
land and fixed
assets -- 2 -- 2
Gain on sale of
credit card
portfolio -- 7 133 311
Bank owned life
insurance income 133 119 390 361
Other 44 47 125 137
----------------------- -----------------------
Total non-interest
income 2,410 2,143 6,816 6,812
----------------------- -----------------------
NON-INTEREST EXPENSE:
Salaries and employee
benefits 3,688 3,681 11,055 10,521
Occupancy and
depreciation 1,185 954 3,394 2,640
Data processing 220 335 777 1,073
Amortization of core
deposit intangible 44 53 140 157
Advertising and
marketing expense 269 160 927 697
FDIC insurance
premium 18 19 55 51
State and local taxes 166 136 454 419
Telecommunications 115 117 328 279
Professional fees 199 248 575 1,000
Other 557 445 1,797 1,668
----------------------- -----------------------
Total non-interest
expense 6,461 6,148 19,502 18,505
----------------------- -----------------------
INCOME BEFORE INCOME
TAXES 4,892 4,138 13,447 10,743
PROVISION FOR INCOME
TAXES 1,654 1,390 4,605 3,612
----------------------- -----------------------
NET INCOME $ 3,238 $ 2,748 $ 8,842 $ 7,131
======================= =======================
Earnings per common
share:
Basic $ 0.29 $ 0.24 $ 0.78 $ 0.64
Diluted $ 0.28 $ 0.24 $ 0.77 $ 0.63
Weighted average
number of shares
outstanding:
Basic 11,313,623 11,322,648 11,291,175 11,179,640
Diluted 11,522,519 11,462,945 11,478,306 11,314,024
At or for the nine months At or for the Year
ended December 31, ended March 31,
2006 2005 2006
---- ---- ----
(Dollars in thousands, except share data)
FINANCIAL
CONDITION DATA
---------------
Average interest-
earning assets $726,909 $637,599 $645,084
Average interest-
bearing 609,037 525,156 532,521
liabilities
Net average
earning assets 117,872 112,443 112,563
Non-performing
assets 1,276 782 415
Non-performing
loans 1,276 782 415
Allowance for loan
losses 8,628 7,050 7,221
Allowance for loan
losses and
unfunded loan
commitments 8,983 7,402 7,583
Average interest-
earning assets to
average
interest-bearing
liabilities 119.35% 121.41% 121.14%
Allowance for loan
losses to non-
performing loans 676.18% 901.53% 1740.00%
Allowance for loan
losses to net
loans 1.22% 1.16% 1.15%
Allowance for loan
losses and
unfunded loan
commitments to
net loans 1.27% 1.22% 1.20%
Non-performing
loans to total
net loans 0.18% 0.13% 0.07%
Non-performing
assets to total
assets 0.15% 0.11% 0.05%
Shareholders'
equity to assets 11.73% 12.30% 12.00%
Number of banking
facilities 19 17 18
At nine months
ended December 31,
LOAN DATA 2006 2005
--------- ---- ----
Residential:
One-to-four family $ 33,416 4.7% $ 32,350 5.3%
Multi-family 3,147 0.4% 2,132 0.3%
Construction:
One-to-four family 91,245 12.9% 41,578 6.8%
Commercial real estate 49,750 7.0% 71,546 11.7%
Commercial 72,220 10.2% 62,221 10.2%
Consumer:
Secured 32,153 4.5% 29,915 4.9%
Unsecured 1,118 0.2% 1,617 0.3%
Land 62,207 8.8% 50,276 8.2%
Commercial real estate 364,623 51.3% 319,250 52.3%
------------------------------------
709,879 100.0% 610,885 100.0%
Less:
Deferred loan fees 3,980 4,201
Allowance for loan
losses 8,628 7,050
------------------------------------
Loans receivable, net $697,271 $599,634
====================================
DEPOSIT DATA
Interest Checking $145,347 22.3% $136,218 23.0%
Regular Savings 29,491 4.5% 40,187 6.8%
Money Market Deposit
Accounts 179,010 27.5% 125,668 21.2%
Non-Interest Checking 88,244 13.6% 91,514 15.5%
Certificates of Deposit 209,105 32.1% 198,621 33.5%
------------------------------------
Total Deposits $651,197 100.0% $592,208 100.0%
====================================
At six months At the year
ended September 30, ended March 31,
LOAN DATA 2006 2006
--------- ---- ----
Residential:
One-to-four family $ 34,552 4.9% $ 32,488 5.1%
Multi-family 3,219 0.5% 2,157 0.3%
Construction:
One-to-four family 91,051 12.9% 81,572 12.9%
Commercial real estate 51,510 7.3% 47,079 7.4%
Commercial 66,008 9.4% 59,834 9.4%
Consumer:
Secured 31,484 4.5% 29,781 4.7%
Unsecured 1,141 0.2% 1,415 0.2%
Land 62,989 9.0% 49,558 7.8%
Commercial real estate 361,244 51.3% 330,705 52.2%
------------------------------------
703,198 100.0% 634,589 100.0%
Less:
Deferred loan fees 4,285 4,352
Allowance for loan
losses 8,263 7,221
------------------------------------
Loans receivable, net $690,650 $623,016
====================================
DEPOSIT DATA
Interest Checking $153,631 24.0% $129,457 21.3%
Regular Savings 32,896 5.1% 38,344 6.3%
Money Market Deposit
Accounts 145,612 22.8% 137,451 22.7%
Non-Interest Checking 101,852 15.9% 94,592 15.6%
Certificates of Deposit 206,413 32.2% 207,120 34.1%
------------------------------------
Total Deposits $640,404 100.0% $606,964 100.0%
====================================
At or for the At or for the
three months ended nine months ended
SELECTED OPERATING December 31, December 31,
DATA 2006 2005 2006 2005
------------------ ---- ---- ---- ----
(Dollars in thousands, except share data)
Efficiency ratio (d) 55.09% 57.53% 56.90% 60.58%
Efficiency ratio net
of intangible
amortization 54.52% 56.82% 56.29% 59.75%
Coverage ratio (f) 144.22% 138.96% 140.80% 128.27%
Coverage ratio net of
intangible
amortization 145.21% 140.16% 141.81% 129.37%
Return on average
assets (a) 1.53% 1.50% 1.45% 1.34%
Return on average
equity (a) 13.00% 11.90% 12.15% 10.78%
Average rate earned
on interest-earned
assets 8.43% 7.51% 8.33% 7.13%
Average rate paid on
interest-bearing
liabilities 4.18% 2.80% 3.95% 2.63%
Spread (g) 4.25% 4.71% 4.38% 4.50%
Net interest margin 4.89% 5.23% 5.03% 4.96%
PER SHARE DATA
--------------
Basic earnings per
share (b) $0.29 $0.24 $0.78 $0.64
Diluted earnings
per share (c) 0.28 0.24 0.77 0.63
Book value per
share (e) 8.44 7.82 8.44 7.82
Tangible book value
per share (e) 6.14 5.46 6.14 5.46
Market price per share:
High for the period $15.720 $11.965 $15.720 $11.970
Low for the period 13.470 10.380 12.140 10.170
Close for period end 15.200 11.660 15.200 11.660
Cash dividends
declared per share 0.100 0.085 0.295 0.255
Average number of
shares outstanding:
Basic (b) 11,313,623 11,322,648 11,291,175 11,179,640
Diluted (c) 11,522,519 11,462,945 11,478,306 11,314,024
(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.
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.