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Riverview Bancorp Reports Earnings for Third Fiscal Quarter 2018 Pre-Tax Income increases 72% Year-Over-Year

VANCOUVER, Wash., Jan. 25, 2018 (GLOBE NEWSWIRE) -- Riverview Bancorp, Inc. (Nasdaq:RVSB) (“Riverview” or the “Company”) today reported net income of $1.5 million, or $0.07 per diluted share, in its third fiscal quarter ended December 31, 2017. This compares to net income of $3.1 million, or $0.14 per diluted share, in the preceding quarter and net income of $2.0 million, or $0.09 per diluted share, in the third fiscal quarter a year ago. Net income was impacted during the current quarter due to a valuation adjustment of the Company’s net deferred tax asset along with the use of a lower blended tax rate, which resulted in an additional net income tax expense of $1.8 million, or $0.08 per diluted share. Pre-tax income for the third fiscal quarter of 2018 was $5.1 million, which was a $449,000, or 9.6%, increase compared to the preceding quarter and a $2.1 million, or 71.8%, increase from the year ago quarter.

In the first nine months of fiscal year 2018, Riverview’s net income increased to $7.2 million, or $0.32 per diluted share, compared to $5.4 million, or $0.24 per diluted share, in the first nine months of fiscal year 2017.

“Riverview had another successful quarter with strong net interest income generation, an expanding net interest margin and continued operating efficiencies,” stated Pat Sheaffer, chairman, chief executive officer and president. “With the successful integration of the MBank transaction behind us, our focus remains on expanding our franchise. We will continue to look for growth opportunities in the Portland area and its surrounding markets.”

As a result of the Tax Cuts and Jobs Act (the “Tax Act”) enacted on December 22, 2017, Riverview revalued its deferred tax assets and liabilities to account for the future impact of lower corporate tax rates and other provisions of the Tax Act. Based on its preliminary analysis, Riverview recorded a one-time net tax charge of $1.8 million related to the lower corporate tax rate adopted in the Tax Act. This increase in income tax expense was reflected in Riverview’s operating results for the third fiscal quarter of 2018 and was in addition to the normal provision for income tax related to pre-tax net operating income.

“We recorded an additional net income tax expense of $1.8 million, or $0.08 per diluted share, due to the passage of the Tax Cuts and Jobs Act in the third fiscal quarter of 2018,” said Kevin Lycklama, executive vice president and chief operating officer. “Going forward, we expect to fully recoup this additional expense within the next fiscal year, due to the lower corporate tax rate. The effective tax rate for our fourth fiscal quarter of 2018 is expected to be approximately 31.5% due to our use of a blended tax rate for the remainder of this fiscal year. We expect our effective tax rate will decline to approximately 22.5% beginning on April 1, 2018 at the start of our new fiscal year.”

Third Quarter Highlights (at or for the period ended December 31, 2017)

  • Net interest margin (NIM) expanded by three basis points to 4.06% compared to the preceding quarter and expanded 31 basis points compared to the third quarter a year ago.
  • Total loans increased $13.6 million during the quarter to $797.3 million.
  • Non-performing assets were 0.26% of total assets.
  • Efficiency ratio improved to 62.5%.
  • Tangible book value per share was $3.93.
  • Total risk-based capital ratio was 15.07% and Tier 1 leverage ratio was 9.82%.
  • Declared quarterly cash dividend of $0.03 per share, generating a current dividend yield of 1.28% based on the market price on January 23, 2018.

Income Statement

Riverview’s net interest income was $10.8 million in the third fiscal quarter of 2018, a $71,000 increase compared to $10.7 million in the preceding quarter and a $2.3 million increase compared to $8.5 million in the third fiscal quarter a year ago. In the first nine months of fiscal 2018, net interest income increased $7.5 million to $32.0 million compared to $24.4 million in the first nine months of fiscal 2017.

“Our net interest margin expanded three basis points in the third quarter of fiscal 2018 compared to the prior linked quarter reflecting a lower balance of cash and liquid assets earning a nominal yield,” said Lycklama. The interest accretion on purchased loans totaled $175,000 and resulted in a six basis point increase in the NIM during the third fiscal quarter. Fiscal year-to-date, the NIM increased 33 basis points to 4.06% compared to 3.73% in the first nine months of fiscal 2017.

Non-interest income was $2.9 million in the third fiscal quarter, a $177,000 increase compared to $2.7 million the prior quarter and a $557,000 increase compared to $2.3 million in the same quarter a year ago. In the first nine months of fiscal 2018, non-interest income increased to $8.3 million compared to $7.4 million in the first nine months of fiscal 2017. The nine month year over year increase was primarily due to an increase in fees and service charges and asset management fees.

Asset management fees were $911,000 in the third fiscal quarter of 2018 compared to $818,000 in the preceding quarter and $709,000 in the third fiscal quarter a year ago. Riverview Trust Company’s (“RTC”) assets under management increased to $490.1 million at December 31, 2017 compared to $461.2 million three months earlier and $403.3 million a year earlier. During the fourth quarter of fiscal 2017, RTC opened a second office in the Portland suburb of Lake Oswego, expanding its footprint and product offerings in the Portland market.

Non-interest expense decreased $201,000 to $8.6 million during the third fiscal quarter of 2018 compared to $8.8 million in the preceding quarter and increased $707,000 from $7.9 million for the same prior year period mainly due to the MBank transaction. There were no transaction related costs from the MBank transaction in the current quarter compared to $177,000 in transaction related costs during the preceding quarter. The efficiency ratio improved to 62.5% for the quarter ended December 31, 2017, compared to 65.2% in the preceding quarter and 72.5% in the third fiscal quarter a year ago. “With all MBank transaction costs behind us, we expect to continue to capitalize on the cost savings and operating efficiencies associated with a larger organization,” said Lycklama. “We will continue to look for other opportunities to improve profitability and increase shareholder value.”

Balance Sheet Review

Total loans increased $13.6 million during the quarter to $797.3 million at December 31, 2017 compared to $783.7 million at September 30, 2017, and increased $133.0 million compared to $664.3 million a year ago. The growth in the loan portfolio was primarily concentrated in commercial business, multi-family and warehouse/industrial loans. Undisbursed construction loans totaled $61.8 million at December 31, 2017, with the majority of the undisbursed construction loans expected to fund over the next several quarters. The commercial loan pipeline totaled $61.6 million at the end of the quarter.

Total deposits increased $131.8 million to $972.2 million at December 31, 2017 compared to $840.4 million a year ago but decreased compared to $990.3 million at September 30, 2017. The decrease compared to the prior quarter end was primarily due to the timing of deposit transactions. Core deposits represent 98.0% of total deposits at December 31, 2017.

Shareholders’ equity was $116.8 million at December 31, 2017 compared to $116.7 million three months earlier and $109.4 million a year earlier. Tangible book value per share was $3.93 at both December 31, 2017 and September 30, 2017 and an increase compared to $3.72 at December 31, 2016. A quarterly cash dividend of $0.03 per share was paid on January 23, 2018.

Credit Quality

Classified assets totaled $6.9 million at December 31, 2017 compared to $7.1 million at September 30, 2017 and the classified asset to total capital ratio was 5.7% compared to 6.0%, respectively.

Riverview’s non-performing loans were $2.7 million, or 0.33% of total loans, at December 31, 2017 compared to $2.8 million, or 0.35% of total loans, three months earlier. Real estate owned balances of $298,000 at December 31, 2017 were unchanged compared to the preceding quarter end.

The allowance for loan losses totaled $10.9 million, representing 1.36% of total loans at December 31, 2017 compared to $10.6 million and 1.35% of total loans at September 30, 2017. Included in the carrying value of loans are net discounts on the MBank purchased loans which may reduce the need for an allowance for loan losses on these loans, because they are carried at an amount below the outstanding principal balance. The remaining net discount on these purchased loans was $2.4 million at December 31, 2017 compared to $2.6 million at the end of the prior quarter. Net loan recoveries were $250,000 during the third fiscal quarter of 2018 compared to $20,000 in the preceding quarter.

Riverview recorded no provision for loan losses during the third fiscal quarter of 2018 or in the preceding quarter, primarily as a result of the lower levels of delinquent, nonperforming and classified loans, elevated levels of net recoveries, as well as stabilizing values in our market areas which mitigated the required allowance for loan losses due to our loan growth.

Capital

Riverview continues to maintain capital levels well in excess of the regulatory requirements to be categorized as “well capitalized” with a total risk-based capital ratio of 15.07% and a Tier 1 leverage ratio of 9.82% at December 31, 2017. In addition at that date the Company’s tangible common equity to tangible assets ratio was 8.05%.

Non-GAAP Financial Measures

In addition to results presented in accordance with generally accepted accounting principles (“GAAP”), this press release contains certain non-GAAP financial measures. We believe that certain non-GAAP financial measures provide investors with information useful in understanding the Company’s financial performance; however, readers of this report are urged to review these non-GAAP financial measures in conjunction with GAAP results as reported.

Financial measures that exclude intangible assets are non-GAAP measures. To provide investors with a broader understanding of capital adequacy, Riverview provides non-GAAP financial measures for tangible common equity, along with the GAAP measure. Tangible common equity is calculated as shareholders’ equity less goodwill and other intangible assets. In addition, tangible assets are total assets less goodwill and other intangible assets. We calculate tangible book value per share by dividing tangible common equity by the number of common shares outstanding. This non-GAAP financial measure has inherent limitations, is not required to be uniformly applied and is not audited. Further, the non-GAAP financial measure should not be considered in isolation or as a substitute for book value per share or total stockholders' equity determined in accordance with GAAP and may not be comparable to similarly titled measures reported by other companies. Reconciliations of the GAAP and non-GAAP financial measures are presented below.

(Dollars in thousands) December 31, 2017 September 30, 2017 December 31, 2016 March 31, 2017
Shareholders' equity $ 116,803 $ 116,742 $ 109,400 $ 111,264
Goodwill 27,076 27,076 25,572 27,076
Core deposit intangible, net 1,161 1,219 - 1,335
Tangible shareholders' equity $ 88,566 $ 88,447 $ 83,828 $ 82,853
Total assets $ 1,128,342 $ 1,147,680 $ 985,669 $ 1,133,939
Goodwill 27,076 27,076 25,572 27,076
Core deposit intangible, net 1,161 1,219 - 1,335
Tangible assets $ 1,100,105 $ 1,119,385 $ 960,097 $ 1,105,528

About Riverview

Riverview Bancorp, Inc. (www.riverviewbank.com) is headquartered in Vancouver, Washington – just north of Portland, Oregon on the I-5 corridor. With assets of $1.13 billion at December 31, 2017, it is the parent company of the 94-year-old Riverview Community Bank, as well as Riverview Trust Company. The Bank offers true community banking services, focusing on providing the highest quality service and financial products to commercial and retail customers. There are 19 branches, including 14 in the Portland-Vancouver area and three lending centers. For the past 4 years, Riverview has been named Best Bank by the readers of The Vancouver Business Journal, The Columbian and The Gresham Outlook.

“Safe Harbor” statement under the Private Securities Litigation Reform Act of 1995: This press release contains forward-looking statements that are subject to risks and uncertainties, including, but not limited to: expected cost savings, synergies and other financial benefits from our recent purchase of certain assets and assumption of certain liabilities of MBank and Merchants Bancorp pursuant to the Purchase and Assumption Agreement (the "Agreement") with Merchants Bancorp and its wholly owned subsidiary MBank (the "transaction") might not be realized within the expected time frames or at all, and costs or difficulties relating to integration matters might be greater than expected; the Company’s ability to raise common capital; the credit risks of lending activities, including changes in the level and trend of loan delinquencies and write-offs and changes in the Company’s allowance for loan losses and provision for loan losses that may be impacted by deterioration in the housing and commercial real estate markets; changes in general economic conditions, either nationally or in the Company’s market areas; changes in the levels of general interest rates, and the relative differences between short and long term interest rates, deposit interest rates, the Company’s net interest margin and funding sources; fluctuations in the demand for loans, the number of unsold homes, land and other properties and fluctuations in real estate values in the Company’s market areas; secondary market conditions for loans and the Company’s ability to sell loans in the secondary market; results of examinations of us by the Office of Comptroller of the Currency or other regulatory authorities, including the possibility that any such regulatory authority may, among other things, require us to increase the Company’s reserve for loan losses, write-down assets, change Riverview Community Bank’s regulatory capital position or affect the Company’s ability to borrow funds or maintain or increase deposits, which could adversely affect its liquidity and earnings; legislative or regulatory changes that adversely affect the Company’s business including changes in regulatory policies and principles, or the interpretation of regulatory capital or other rules; the Company’s ability to attract and retain deposits; further increases in premiums for deposit insurance; the Company’s ability to control operating costs and expenses; the use of estimates in determining fair value of certain of the Company’s assets, which estimates may prove to be incorrect and result in significant declines in valuation; difficulties in reducing risks associated with the loans on the Company’s balance sheet; staffing fluctuations in response to product demand or the implementation of corporate strategies that affect the Company’s workforce and potential associated charges; computer systems on which the Company depends could fail or experience a security breach; the Company’s ability to retain key members of its senior management team; costs and effects of litigation, including settlements and judgments; the Company’s ability to successfully integrate any assets, liabilities, customers, systems, and management personnel it may in the future acquire into its operations and the Company’s ability to realize related revenue synergies and cost savings within expected time frames and any goodwill charges related thereto; increased competitive pressures among financial services companies; changes in consumer spending, borrowing and savings habits; the availability of resources to address changes in laws, rules, or regulations or to respond to regulatory actions; the Company’s ability to pay dividends on its common stock; and interest or principal payments on its junior subordinated debentures; adverse changes in the securities markets; inability of key third-party providers to perform their obligations to us; changes in accounting policies and practices, as may be adopted by the financial institution regulatory agencies or the Financial Accounting Standards Board, including additional guidance and interpretation on accounting issues and details of the implementation of new accounting methods; other economic, competitive, governmental, regulatory, and technological factors affecting the Company’s operations, pricing, products and services and the other risks described from time to time in our filings with the SEC.

Such forward-looking statements may include projections. Any such projections were not prepared in accordance with published guidelines of the American Institute of Certified Public Accountants or the Securities Exchange Commission regarding projections and forecasts nor have such projections been audited, examined or otherwise reviewed by independent auditors of the Company. In addition, such projections are based upon many estimates and inherently subject to significant economic and competitive uncertainties and contingencies, many of which are beyond the control of management of the Company. Accordingly, actual results may be materially higher or lower than those projected. The inclusion of such projections herein should not be regarded as a representation by the Company that the projections will prove to be correct.

The Company cautions readers not to place undue reliance on any forward-looking statements. Moreover, you should treat these statements as speaking only as of the date they are made and based only on information then actually known to the Company. The Company does not undertake and specifically disclaims any obligation to revise any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements. These risks could cause our actual results for fiscal 2018 and beyond to differ materially from those expressed in any forward-looking statements by, or on behalf of, us, and could negatively affect the Company’s operating and stock price performance.

RIVERVIEW BANCORP, INC. AND SUBSIDIARY
Consolidated Balance Sheets
(In thousands, except share data) (Unaudited)December 31, 2017 September 30, 2017 December 31, 2016 March 31, 2017
ASSETS
Cash (including interest-earning accounts of $3,739, $59,315, $14,302$ 23,105 $ 76,245 $ 28,262 $ 64,613
and $46,245)
Certificate of deposits held for investment 6,963 9,797 11,291 11,042
Loans held for sale 351 347 1,679 478
Investment securities:
Available for sale, at estimated fair value 224,931 200,584 207,271 200,214
Held to maturity, at amortized cost 44 46 67 64
Loans receivable (net of allowance for loan losses of $10,867, $10,617
$10,289, and $10,528) 786,460 773,087 654,053 768,904
Real estate owned 298 298 298 298
Prepaid expenses and other assets 4,843 4,227 4,832 3,815
Accrued interest receivable 3,464 3,111 2,846 2,941
Federal Home Loan Bank stock, at cost 1,223 1,181 1,060 1,181
Premises and equipment, net 15,680 15,740 13,953 16,232
Deferred income taxes, net 3,988 6,167 8,665 7,610
Mortgage servicing rights, net 399 406 390 398
Goodwill 27,076 27,076 25,572 27,076
Core deposit intangible, net 1,161 1,219 - 1,335
Bank owned life insurance 28,356 28,149 25,430 27,738
TOTAL ASSETS$ 1,128,342 $ 1,147,680 $ 985,669 $ 1,133,939
LIABILITIES AND SHAREHOLDERS' EQUITY
LIABILITIES:
Deposits$ 972,214 $ 990,299 $ 840,391 $ 980,058
Accrued expenses and other liabilities 9,117 10,838 10,450 13,080
Advance payments by borrowers for taxes and insurance 260 920 288 693
Federal Home Loan Bank advances 1,050 - - -
Junior subordinated debentures 26,461 26,438 22,681 26,390
Capital lease obligations 2,437 2,443 2,459 2,454
Total liabilities 1,011,539 1,030,938 876,269 1,022,675
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, 2017 - 22,551,912 issued and outstanding;
September 30, 2017 - 22,533,912 issued and outstanding; 226 225 225 225
December 31, 2016 - 22,510,890 issued and outstanding;
March 31, 2017 – 22,510,890 issued and outstanding;
Additional paid-in capital 64,703 64,612 64,448 64,468
Retained earnings 53,878 53,034 46,750 48,335
Unearned shares issued to employee stock ownership plan - (26) (103) (77)
Accumulated other comprehensive loss (2,004) (1,103) (1,920) (1,687)
Total shareholders’ equity 116,803 116,742 109,400 111,264
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY$1,128,342 $1,147,680 $985,669 $1,133,939

RIVERVIEW BANCORP, INC. AND SUBSIDIARY
Consolidated Statements of Income
Three Months Ended Nine Months Ended
(In thousands, except share data) (Unaudited)Dec. 31, 2017Sept. 30, 2017Dec. 31, 2016 Dec. 31, 2017Dec. 31, 2016
INTEREST INCOME:
Interest and fees on loans receivable$ 9,978$ 9,994$ 7,883 $ 29,761$ 22,954
Interest on investment securities - taxable 1,201 1,079 946 3,413 2,435
Interest on investment securities - nontaxable 31 14 11 59 11
Other interest and dividends 168 228 112 483 344
Total interest and dividend income 11,378 11,315 8,952 33,716 25,744
INTEREST EXPENSE:
Interest on deposits 298 313 277 933 837
Interest on borrowings 284 277 173 829 494
Total interest expense 582 590 450 1,762 1,331
Net interest income 10,796 10,725 8,502 31,954 24,413
Provision for loan losses - - - - -
Net interest income after provision for loan losses 10,796 10,725 8,502 31,954 24,413
NON-INTEREST INCOME:
Fees and service charges 1,451 1,490 1,304 4,348 3,815
Asset management fees 911 818 709 2,582 2,258
Net gain on sale of loans held for sale 140 157 191 522 493
Bank owned life insurance 206 204 185 617 566
Other, net 182 44 (56) 272 296
Total non-interest income 2,890 2,713 2,333 8,341 7,428
NON-INTEREST EXPENSE:
Salaries and employee benefits 5,383 5,251 4,850 16,056 14,021
Occupancy and depreciation 1,347 1,412 1,158 4,105 3,520
Data processing 534 580 562 1,730 1,533
Amortization of core deposit intangible 58 58 - 174 -
Advertising and marketing expense 137 256 163 627 608
FDIC insurance premium 108 136 77 389 273
State and local taxes 96 177 170 427 455
Telecommunications 102 103 75 309 224
Professional fees 250 261 355 926 1,066
Real estate owned expenses 3 3 2 8 52
Other 540 522 439 1,740 2,311
Total non-interest expense 8,558 8,759 7,851 26,491 24,063
INCOME BEFORE INCOME TAXES 5,128 4,679 2,984 13,804 7,778
PROVISION FOR INCOME TAXES 3,608 1,620 991 6,571 2,408
NET INCOME$ 1,520$ 3,059$ 1,993 $ 7,233$ 5,370
Earnings per common share:
Basic$ 0.07$ 0.14$ 0.09 $ 0.32$ 0.24
Diluted$ 0.07$ 0.14$ 0.09 $ 0.32$ 0.24
Weighted average number of common shares outstanding:
Basic 22,537,092 22,518,941 22,490,433 22,520,352 22,477,473
Diluted 22,622,129 22,609,480 22,563,712 22,608,603 22,537,663

(Dollars in thousands) At or for the three months ended At or for the nine months ended
Dec. 31, 2017 Sept. 30, 2017 Dec. 31, 2016 Dec. 31, 2017 Dec. 31, 2016
AVERAGE BALANCES
Average interest–earning assets $1,055,600 $1,056,818 $900,542 $ 1,045,283 $ 869,364
Average interest-bearing liabilities 744,431 749,172 652,195 746,262 636,795
Net average earning assets 311,169 307,646 248,347 299,021 232,569
Average loans 785,264 783,213 658,212 784,926 645,598
Average deposits 988,558 992,111 839,588 980,766 810,700
Average equity 118,831 116,675 112,444 116,399 111,261
Average tangible equity (non-GAAP) 90,562 88,351 86,872 88,074 85,689
ASSET QUALITY Dec. 31, 2017 Sept. 30, 2017 Dec. 31, 2016
Non-performing loans $ 2,656 $ 2,745 $ 2,787
Non-performing loans to total loans 0.33% 0.35% 0.42%
Real estate/repossessed assets owned $ 298 $ 298 $ 298
Non-performing assets $ 2,954 $ 3,043 $ 3,085
Non-performing assets to total assets 0.26% 0.27% 0.31%
Net recoveries in the quarter $ (250) $ (20) $ (266)
Net recoveries in the quarter/average net loans (0.13)% (0.01)% (0.14)%
Allowance for loan losses $ 10,867 $ 10,617 $ 10,289
Average interest-earning assets to average
interest-bearing liabilities 141.80% 141.06% 138.08%
Allowance for loan losses to
non-performing loans 409.15% 386.78% 369.18%
Allowance for loan losses to total loans 1.36% 1.35% 1.55%
Shareholders’ equity to assets 10.35% 10.17% 11.10%
CAPITAL RATIOS
Total capital (to risk weighted assets) 14.94% 15.07% 15.93%
Tier 1 capital (to risk weighted assets) 13.68% 13.82% 14.68%
Common equity tier 1 (to risk weighted assets) 13.68% 13.82% 14.68%
Tier 1 capital (to average tangible assets) 9.84% 9.75% 10.81%
Tangible common equity (to average tangible assets) 8.05% 7.90% 8.73%
DEPOSIT MIX Dec. 31, 2017 Sept. 30, 2017 Dec. 31, 2016 March 31, 2017
Interest checking $170,151 $175,127 $167,522 $ 171,152
Regular savings 136,249 134,116 109,629 126,370
Money market deposit accounts 270,193 274,409 250,900 289,998
Non-interest checking 264,728 270,678 202,080 242,738
Certificates of deposit 130,893 135,969 110,260 149,800
Total deposits $ 972,214 $ 990,299 $840,391 $ 980,058

COMPOSITION OF COMMERCIAL AND CONSTRUCTION LOANS
Other Commercial
Commercial Real Estate Real Estate & Construction
Business Mortgage Construction Total
December 31, 2017 (Dollars in thousands)
Commercial business $ 130,960 $ - $ - $ 130,960
Commercial construction - - 25,384 25,384
Office buildings - 122,281 - 122,281
Warehouse/industrial - 83,829 - 83,829
Retail/shopping centers/strip malls - 67,751 - 67,751
Assisted living facilities - 2,982 - 2,982
Single purpose facilities - 165,060 - 165,060
Land - 12,469 - 12,469
Multi-family - 61,851 - 61,851
One-to-four family construction - - 15,359 15,359
Total $ 130,960 $ 516,223 $ 40,743 $ 687,926
March 31, 2017
Commercial business $ 107,371 $ - $ - $ 107,371
Commercial construction - - 27,050 27,050
Office buildings - 121,983 - 121,983
Warehouse/industrial - 74,671 - 74,671
Retail/shopping centers/strip malls - 78,757 - 78,757
Assisted living facilities - 3,686 - 3,686
Single purpose facilities - 167,974 - 167,974
Land - 15,875 - 15,875
Multi-family - 43,715 - 43,715
One-to-four family construction - - 19,107 19,107
Total $ 107,371 $ 506,661 $ 46,157 $ 660,189
LOAN MIX Dec. 31, 2017 Sept. 30, 2017 Dec. 31, 2016 March 31, 2017
(Dollars in thousands)
Commercial and construction
Commercial business $ 130,960 $ 118,444 $ 64,401 $ 107,371
Other real estate mortgage 516,223 500,382 432,782 506,661
Real estate construction 40,743 53,878 52,707 46,157
Total commercial and construction 687,926 672,704 549,890 660,189
Consumer
Real estate one-to-four family 91,752 90,764 85,956 92,865
Other installment 17,649 20,236 28,496 26,378
Total consumer 109,401 111,000 114,452 119,243
Total loans 797,327 783,704 664,342 779,432
Less:
Allowance for loan losses 10,867 10,617 10,289 10,528
Loans receivable, net $ 786,460 $ 773,087 $ 654,053 $ 768,904

DETAIL OF NON-PERFORMING ASSETS
Other Southwest Other
Oregon Washington Washington Other Total
December 31, 2017
Commercial business $ - $ 289 $ - $ - $ 289
Commercial real estate 1,084 207 - - 1,291
Land 770 - - - 770
Consumer - 207 - 99 306
Total non-performing loans 1,854 703 - 99 2,656
REO - - 298 - 298
Total non-performing assets $ 1,854 $ 703 $ 298 $ 99 $ 2,954
DETAIL OF LAND DEVELOPMENT AND SPECULATIVE CONSTRUCTION LOANS
Northwest Other Southwest
Oregon Oregon Washington Total
December 31, 2017 (dollars in thousands)
Land development $ 486 $ 896 $ 11,087 $ 12,469
Speculative construction - 371 12,335 12,706
Total land development and speculative construction$ 486 $ 1,267 $ 23,422 $ 25,175

At or for the three months ended At or for the nine months ended
SELECTED OPERATING DATADec. 31, 2017Sept. 30, 2017Dec. 31, 2016 Dec. 31, 2017Dec. 31, 2016
Efficiency ratio (4) 62.53% 65.18% 72.46% 65.74% 75.57%
Coverage ratio (6) 126.15% 122.45% 108.29% 120.62% 101.45%
Return on average assets (1) 0.53% 1.06% 0.80% 0.85% 0.75%
Return on average equity (1) 5.07% 10.40% 7.03% 8.25% 6.41%
NET INTEREST SPREAD
Yield on loans 5.04% 5.06% 4.75% 5.03% 4.72%
Yield on investment securities 2.24% 2.14% 2.06% 2.20% 1.96%
Total yield on interest-earning assets 4.28% 4.25% 3.95% 4.29% 3.93%
Cost of interest-bearing deposits 0.17% 0.17% 0.18% 0.17% 0.18%
Cost of FHLB advances and other borrowings 3.89% 3.81% 2.73% 3.80% 2.61%
Total cost of interest-bearing liabilities 0.31% 0.31% 0.27% 0.31% 0.28%
Spread (7) 3.97% 3.94% 3.68% 3.98% 3.65%
Net interest margin 4.06% 4.03% 3.75% 4.06% 3.73%
PER SHARE DATA
Basic earnings per share (2)$ 0.07 $ 0.14 $ 0.09 $ 0.32 $ 0.24
Diluted earnings per share (3) 0.07 0.14 0.09 0.32 0.24
Book value per share (5) 5.18 5.18 4.86 5.18 4.86
Tangible book value per share (5) (non-GAAP) 3.93 3.93 3.72 3.93 3.72
Market price per share:
High for the period$ 9.45 $ 8.48 $ 7.61 $ 9.45 $ 7.61
Low for the period 8.44 6.64 5.23 6.51 4.30
Close for period end 8.67 8.40 7.00 8.67 7.00
Cash dividends declared per share 0.0300 0.0225 0.0200 0.0750 0.0600
Average number of shares outstanding:
Basic (2) 22,537,092 22,518,941 22,490,433 22,520,352 22,477,473
Diluted (3) 22,622,129 22,609,480 22,563,712 22,608,603 22,537,663


(1)Amounts for the quarterly periods are annualized.
(2)Amounts exclude ESOP shares not committed to be released.
(3)Amounts exclude ESOP shares not committed to be released and include common stock equivalents.
(4)Non-interest expense divided by net interest income and non-interest income.
(5)Amounts calculated based on shareholders’ equity and include ESOP shares not committed to be released.
(6)Net interest income divided by non-interest expense.
(7)Yield on interest-earning assets less cost of funds on interest-bearing liabilities.


Contacts: Pat Sheaffer or Kevin Lycklama
Riverview Bancorp, Inc. 360-693-6650

Source:Riverview Bancorp Inc

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