UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934


Date of Report (Date of earliest event reported): October 28, 2014

RIVERVIEW BANCORP, INC.
(Exact name of registrant as specified in its charter)

Washington
000-22957
91-1838969
(State or other jurisdiction
of incorporation)
(Commission
File Number)
(I.R.S. Employer
Identification No.)

900 Washington Street, Suite 900, Vancouver, Washington
98660
(Address of principal executive offices)
(Zip Code)

Registrant’s telephone number, including area code:  (360) 693-6650


Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions.
 
[   ]  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
[   ]  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
[   ]  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act       
        (17 CFR 240.14d-2(b))
 
[   ]  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act       
        (17 CFR 240.13e-4(c))


 
 
 




Item 2.02 Results of Operations and Financial Condition.

On October 28, 2014, Riverview Bancorp, Inc. issued its earnings release for the quarter ended September 30, 2014.  A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

Item 9.01  Financial Statements and Exhibits.

(d)Exhibits
 
The following exhibit is being furnished herewith and this list shall constitute the exhibit index:

99.1News Release of Riverview Bancorp, Inc. dated October 28, 2014.





 
 
 



SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
  RIVERVIEW BANCORP, INC. 
   
   
Date:  October 28, 2014  /s/ Kevin J. Lycklama                                       
 
Kevin J. Lycklama
Chief Financial Officer
(Principal Financial Officer)
 
 
 
 
 
 
 


Exhibit 99.1
 
 
   
Contacts:  Pat Sheaffer or Ron Wysaske,
                   Riverview Bancorp, Inc. 360-693-6650
 
 
  

Riverview Bancorp Earnings Increase to $1.1 Million;
Highlighted by Improving Credit Quality and Loan Growth

 
Vancouver, WA – October 28, 2014 - Riverview Bancorp, Inc. (Nasdaq GSM: RVSB) (“Riverview” or the “Company”) today reported that it earned $1.1 million, or $0.05 per diluted share, in the second fiscal quarter ended September 30, 2014, compared to $740,000, or $0.03 per diluted share, in the previous quarter and $341,000, or $0.02 per diluted share, in the second fiscal quarter a year ago.
 
“In the first half of fiscal 2015, we have generated solid results on virtually every metric with improving profitability, strengthening asset quality, growth in loans and deposits, and better operating efficiencies,” stated Pat Sheaffer, Chairman and CEO. “As the regional economic recovery continues to build, we are seeing increasing demand for loans and financial services from business owners and retail customers throughout the greater Vancouver and Portland markets that we serve. We believe that our franchise is starting to generate forward momentum and we are encouraged by the outlook for our business in the next few years.”
 
Second Quarter Highlights (at or for the period ended September 30, 2014)

·    
Second quarter net income was $1.1 million, or $0.05 per diluted share.
·    
Net loans increased to $540.8 million, compared to $509.4 million a year ago (6.2% increase).
·    
Non-interest bearing checking account balances increased to $145.1 million, compared to $118.1 million a year ago (22.9% increase).
·    
Classified assets decreased $8.5 million during the quarter to $25.2 million (25.1% decline).
·    
Nonperforming assets decreased $3.5 million during the quarter to $15.4 million (18.6% decline).
·    
Total risk-based capital ratio was 16.78% and Tier 1 leverage ratio was 10.97%.
 
Balance Sheet Review
 
“Our loan pipeline remained strong as demand for loans continues to accelerate,” said Ron Wysaske, President and COO. “While competition remains high, our experienced lending teams continue to have success acquiring new relationships and we expect to see a continued upward trend in loan growth during fiscal year 2015.”
 
Net loans were $540.8 million at September 30, 2014, compared to $534.7 million the previous quarter and $509.4 million a year ago. Loan originations totaled $55.7 million during the quarter and there were $38.1 million in the loan pipeline at September 30, 2014. Despite the increase in loan originations during the quarter, net loan growth was impacted by $18.2 million in early payoffs, a $6.9 million reduction in classified assets as well as several new construction loans that have not yet advanced.  At September 30, 2014, there were $26.3 million in undisbursed construction loans that are expected to fund over several quarters.
 
Total deposits increased $16.0 million during the quarter to $702.6 million, compared to $686.6 million at June 30, 2014. Non-interest bearing checking account balances increased to $145.1 million at September 30, 2014, compared to $134.5 million in the preceding quarter. Checking accounts represented 35.9% of total deposits (interest checking accounts represent 15.3% and non-interest checking accounts represent 20.6%).
 
Shareholders’ equity improved to $100.3 million at September 30, 2014, compared to $99.4 million three months earlier. Tangible book value per share improved to $3.31 per share at September 30, 2014, compared to $3.27 per share at June 30, 2014.
 
 
 
 
RVSB Reports Second Quarter Fiscal 2015 Profits
October 28, 2014
Page 2
 
Credit Quality
 
“Credit quality continues to improve with both nonperforming loans and repossessed assets declining dramatically during the quarter,” said Dan Cox, Executive Vice President and Chief Credit Officer. “We are continuing to work with our customers to resolve problem credits and to move these assets back into earning assets.”
 
Classified assets were reduced by $8.5 million during the quarter to $25.2 million at September 30, 2014, compared to $33.7 million at June 30, 2014. The classified asset ratio decreased to 25.2% at September 30, 2014, compared to 34.4% three months earlier. During the past twelve months, Riverview has shrunk classified assets a total of $33.4 million.
 
Sales of real estate owned (“REO”) remained strong with total sales of $2.8 million during the quarter reducing REO balances to $3.7 million at September 30, 2014. Riverview has an additional $1.4 million in properties currently under purchase contracts, which have already closed or are expected to close during the third fiscal quarter of 2015 with minimal to no projected losses on these sales.
 
The recapture of loan loss provision reflects the continued improvement in credit quality and the increase in loan recoveries. Riverview recorded a $350,000 recapture of loan losses during the second quarter of fiscal 2015 compared to a $300,000 recapture of loan losses during the preceding quarter. In the first six months of fiscal 2015 Riverview recorded a $650,000 recapture for loan losses compared to a $2.5 million recapture in the first six months of fiscal 2014.
 
Net loan recoveries totaled $70,000 during the quarter compared to net loan recoveries of $30,000 in the preceding quarter. During the past twelve months, Riverview had net recoveries totaling $155,000. The allowance for loan losses at September 30, 2014 totaled $12.0 million, representing 2.17% of total loans and 102.21% of nonperforming loans.
 
Income Statement
 
Riverview’s fiscal second quarter net interest income increased to $6.7 million, compared to $6.4 million in the preceding quarter and $6.1 million in the fiscal second quarter a year ago. In the first six months of the fiscal year, net interest income was $13.1 million compared to $12.3 million a year ago. The increase in net interest income was driven primarily by higher average balances in both our loan and investment portfolios.
 
“Our net interest margin improved 15 basis points compared to the preceding quarter and 24 basis points compared to the year ago quarter,” said Kevin Lycklama, Executive Vice President and Chief Financial Officer. “Part of this increase was due to the collection of interest from a prior nonaccrual loan of $121,000, which contributed approximately six basis points to our second quarter margin. The remaining increase was due to deployment of our cash balances into higher yielding loans and investments.”
 
Riverview’s net interest margin was 3.61% in the fiscal second quarter compared to 3.46% for the preceding quarter and 3.37% in the fiscal second quarter a year ago. In the first six months of the fiscal year, Riverview’s net interest margin improved 10 basis points to 3.54% compared to 3.44% in the first six months of fiscal 2014.
 
Non-interest income was $2.2 million in the second quarter, which was unchanged compared to the preceding quarter and increased compared $1.9 million in the second quarter a year ago. In the first six months of fiscal 2015, non-interest income increased to $4.4 million, compared to $4.1 million in the first six months of fiscal 2014. Riverview Asset Management Corporation’s (“RAMCO”) asset management fees were $710,000 during the quarter compared to $820,000 in the preceding quarter and $595,000 in the second quarter a year ago. RAMCO’s assets under management totaled $363.7 million at September 30, 2014.
 
Non-interest expense was $7.7 million in the second quarter, which was unchanged compared to both the preceding quarter and the year ago quarter. In the first six months of the fiscal year, Riverview’s non-interest expense decreased $1.5 million compared to the same period a year ago. The primary driver for the decrease from prior year was a reduction in REO expenses, which decreased $430,000 compared to the preceding quarter and $306,000 a year ago, due to fewer REO write-downs and reduction in the number of REO properties. Furthermore, during the quarter-ended September 30, 2014 Riverview also had a one-time occupancy expense for $111,000 related to the closure of its in-store Walmart branch located in Wood Village, Oregon. The Company expects minimal impact to its customers and deposit totals from this closure due to this branch’s close proximity to the new Gresham office opened in the summer of 2012.
 
 
 
 
RVSB Reports Second Quarter Fiscal 2015 Profits
October 28, 2014
Page 3
 
Capital and Liquidity
 
Riverview continues to maintain capital levels in excess of the regulatory requirements to be categorized as “well capitalized” with a total risk-based capital ratio of 16.78%, Tier 1 leverage ratio of 10.97% and tangible common equity to tangible assets of 9.11% at September 30, 2014.
 
Riverview had available total and contingent liquidity of nearly $500 million, representing 59% of total assets as of September 30, 2014. Included in the Bank’s total liquidity was more than $190 million of cash and short-term investments.
 
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. Riverview believes 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.
 
The following table provides a reconciliation of ending shareholders’ equity (GAAP) to ending tangible shareholders’ equity (non-GAAP), and ending assets (GAAP) to ending tangible assets (non-GAAP).
 
(Dollars in thousands)
  
September 30, 2014
    
June 30, 2014
    
September 30, 2013
    
March 31, 2014
  
                         
Shareholders' equity
   $ 100,311     $ 99,366     $ 80,968     $ 97,978  
Goodwill
     25,572       25,572       25,572       25,572  
Other intangible assets, net
     400       393       427       395  
                                 
Tangible shareholders' equity
   $ 74,339     $ 73,401     $ 54,969     $ 72,011  
                                 
Total assets
   $ 841,540     $ 824,642     $ 788,878     $ 824,521  
Goodwill
     25,572       25,572       25,572       25,572  
Other intangible assets, net
     400       393       427       395  
                                 
Tangible assets
   $ 815,568     $ 798,677     $ 762,879     $ 798,554  

 
 
 
RVSB Reports Second Quarter Fiscal 2015 Profits
October 28, 2014
Page 4

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 $842 million, it is the parent company of the 91 year-old Riverview Community Bank, as well as Riverview Asset Management Corp. The Bank offers true community banking services, focusing on providing the highest quality service and financial products to commercial and retail customers. There are 17 branches, including twelve in the Portland-Vancouver area and three lending centers.
 
“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: 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 2015 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.
 

 
 
 
RVSB Reports Second Quarter Fiscal 2015 Profits
October 28, 2014
Page 5
 
RIVERVIEW BANCORP, INC. AND SUBSIDIARY
                        
Consolidated Balance Sheets
                        
(In thousands, except share data)  (Unaudited)
  
September 30,
2014
    
June 30,
2014
    
September 30,
2013
    
March 31,
2014
  
ASSETS
                        
                         
Cash (including interest-earning accounts of $17,417, $23,815, $99,955
   $ 30,988     $ 41,556     $ 114,337     $ 68,577  
and $51,715)
                                
Certificate of deposits
     32,941       34,435       37,920       36,925  
Loans held for sale
     353       795       1,571       1,024  
Investment securities available for sale, at fair value
     19,571       21,549       21,899       23,394  
Mortgage-backed securities held to maturity, at amortized
     90       98       108       101  
Mortgage-backed securities available for sale, at fair value
     120,740       98,413       17,706       78,575  
Loans receivable (net of allowance for loan losses of $12,001, $12,281,
                                
$13,696, and $12,551)
     540,786       534,712       509,447       520,937  
Real estate and other pers. property owned
     3,705       5,926       13,481       7,703  
Prepaid expenses and other assets
     3,243       3,858       3,141       3,197  
Accrued interest receivable
     2,047       1,964       1,659       1,836  
Federal Home Loan Bank stock, at cost
     6,324       6,533       7,023       6,744  
Premises and equipment, net
     15,955       16,260       16,895       16,417  
Deferred income taxes, net
     14,301       14,748       271       15,433  
Mortgage servicing rights, net
     386       373       388       369  
Goodwill
     25,572       25,572       25,572       25,572  
Core deposit intangible, net
     14       20       39       26  
Bank owned life insurance
     24,524       17,830       17,421       17,691  
                                 
TOTAL ASSETS
   $ 841,540     $ 824,642     $ 788,878     $ 824,521  
                                 
LIABILITIES AND EQUITY
                                
                                 
LIABILITIES:
                                
Deposit accounts
   $ 702,635     $ 686,641     $ 672,806     $ 690,066  
Accrued expenses and other liabilities
     12,445       12,759       8,887       10,497  
Advance payments by borrowers for taxes and insurance
     644       365       486       467  
Junior subordinated debentures
     22,681       22,681       22,681       22,681  
Capital lease obligation
     2,319       2,340       2,401       2,361  
Total liabilities
     740,724       724,786       707,261       726,072  
                                 
EQUITY:
                                
Shareholders' equity
                                
Serial preferred stock, $.01 par value; 250,000 authorized,
                                
issued and outstanding, none
     -       -       -       -  
Common stock, $.01 par value; 50,000,000 authorized,
                                
    September 30, 2014 - 22,471,890 issued and outstanding;
                                
June 30, 2014 – 22,471,890 issued and outstanding;
     225       225       225       225  
    September 30, 2013 - 22,471,890 issued and outstanding;
                                
March 31, 2014 – 22,471,890 issued and outstanding;
                                
Additional paid-in capital
     65,217       65,218       65,557       65,195  
Retained earnings
     35,416       34,332       16,150       33,592  
Unearned shares issued to employee stock ownership trust
     (335 )     (361 )     (438 )     (387 )
Accumulated other comprehensive loss
     (212 )     (48 )     (526 )     (647 )
Total shareholders’ equity
     100,311       99,366       80,968       97,978  
                                 
Noncontrolling interest
     505       490       649       471  
Total equity
     100,816       99,856       81,617       98,449  
                                 
TOTAL LIABILITIES AND EQUITY
   $ 841,540     $ 824,642     $ 788,878     $ 824,521  


 
 
 
RVSB Reports Second Quarter Fiscal 2015 Profits
October 28, 2014
Page 6
 
RIVERVIEW BANCORP, INC. AND SUBSIDIARY
                              
Consolidated Statements of Income
                              
   
Three Months Ended
    
Six Months Ended
  
(In thousands, except share data)   (Unaudited)
  
Sept. 30, 2014
    
June 30, 2014
    
Sept. 30, 2013
    
Sept. 30, 2014
    
Sept. 30, 2013
  
INTEREST INCOME:
                              
Interest and fees on loans receivable
   $ 6,486     $ 6,171     $ 6,465     $ 12,657     $ 13,070  
Interest on investment securities-taxable
     98       84       77       182       116  
Interest on mortgage-backed securities
     508       480       52       988       68  
Other interest and dividends
     118       131       170       249       341  
Total interest income
     7,210       6,866       6,764       14,076       13,595  
                                         
INTEREST EXPENSE:
                                        
Interest on deposits
     342       360       514       702       1,041  
Interest on borrowings
     148       147       150       295       300  
Total interest expense
     490       507       664       997       1,341  
Net interest income
     6,720       6,359       6,100       13,079       12,254  
Less recapture of loan losses
     (350 )     (300 )     -       (650 )     (2,500 )
                                         
Net interest income after recapture of loan losses
     7,070       6,659       6,100       13,729       14,754  
                                         
NON-INTEREST INCOME:
                                        
Fees and service charges
     1,158       1,070       1,094       2,228       2,124  
Asset management fees
     710       820       595       1,530       1,331  
Gain on sale of loans held for sale
     155       126       116       281       433  
Bank owned life insurance income
     194       138       141       332       283  
Other
     6       56       (59 )     62       (38 )
Total non-interest income
     2,223       2,210       1,887       4,433       4,133  
                                         
NON-INTEREST EXPENSE:
                                        
Salaries and employee benefits
     4,341       4,174       3,867       8,515       7,737  
Occupancy and depreciation
     1,322       1,087       1,190       2,409       2,434  
Data processing
     434       470       430       904       1,118  
Amortization of core deposit intangible
     6       6       9       12       26  
Advertising and marketing expense
     203       150       204       353       408  
FDIC insurance premium
     180       175       417       355       828  
State and local taxes
     117       137       108       254       234  
Telecommunications
     74       76       81       150       149  
Professional fees
     257       289       315       546       653  
Real estate owned expenses
     186       616       492       802       2,104  
Other
     554       555       534       1,109       1,199  
Total non-interest expense
     7,674       7,735       7,647       15,409       16,890  
                                         
INCOME BEFORE INCOME TAXES
     1,619       1,134       340       2,753       1,997  
PROVISION (BENEFIT) FOR INCOME TAXES
     535       394       (1 )     929       16  
NET INCOME
   $ 1,084     $ 740     $ 341     $ 1,824     $ 1,981  
                                         
Earnings per common share:
                                        
Basic
   $ 0.05     $ 0.03     $ 0.02     $ 0.08     $ 0.09  
Diluted
   $ 0.05     $ 0.03     $ 0.02     $ 0.08     $ 0.09  
Weighted average number of shares outstanding:
                                        
Basic
     22,388,753       22,382,595       22,364,120       22,385,691       22,361,058  
Diluted
     22,419,469       22,408,775       22,365,460       22,414,212       22,361,941  

 
 
 
RVSB Reports Second Quarter Fiscal 2015 Profits
October 28, 2014
Page 7
 
 
                               
(Dollars in thousands)
  
At or for the three months ended
    
At or for the six months ended
  
   
Sept. 30, 2014
    
June 30, 2014
    
Sept. 30, 2013
    
Sept. 30, 2014
    
Sept. 30, 2013
  
AVERAGE BALANCES
                              
Average interest–earning assets
   $ 737,759     $ 737,717     $ 718,118     $ 737,736     $ 710,559  
Average interest-bearing liabilities
     577,658       578,959       574,990       578,305       571,631  
Net average earning assets
     160,101       158,758       143,128       159,431       138,928  
Average loans
     551,543       538,096       525,490       544,856       528,443  
Average deposits
     693,998       682,113       670,820       688,088       664,015  
Average equity
     101,026       99,695       81,906       100,364       80,957  
Average tangible equity
     75,055       73,730       55,884       74,396       54,935  
 
 
ASSET QUALITY
  
Sept. 30, 2014
  
June 30, 2014
  
Sept. 30, 2013
             
Non-performing loans
  
11,742
  
13,052
  
16,175
Non-performing loans to total loans
  
2.12%
  
2.39%
  
3.09%
Real estate/repossessed assets owned
  
3,705
  
5,926
  
13,481
Non-performing assets
  
15,447
  
18,978
  
29,656
Non-performing assets to total assets
  
1.84%
  
2.30%
  
3.76%
Net loan charge-offs in the quarter
  
(70)
  
(30)
  
1
Net charge-offs in the quarter/average net loans
  
(0.05)%
  
(0.02)%
  
0.00%
             
Allowance for loan losses
  
12,001
  
12,281
  
13,696
Average interest-earning assets to average
            
  interest-bearing liabilities
  
127.72%
  
127.42%
  
124.89%
Allowance for loan losses to
            
  non-performing loans
  
102.21%
  
94.09%
  
84.67%
Allowance for loan losses to total loans
  
2.17%
  
2.25%
  
2.62%
Shareholders’ equity to assets
  
11.92%
  
12.05%
  
10.26%
             
             
CAPITAL RATIOS
            
Total capital (to risk weighted assets)
  
16.78%
  
16.58%
  
16.03%
Tier 1 capital (to risk weighted assets)
  
15.52%
  
15.31%
  
14.76%
Tier 1 capital (to leverage assets)
  
10.97%
  
10.93%
  
10.20%
Tangible common equity (to tangible assets)
  
9.11%
  
9.19%
  
7.21%
 

 
DEPOSIT MIX
  
Sept. 30, 2014
    
June 30, 2014
    
Sept. 30, 2013
    
March 31, 2014
  
                         
Interest checking
   $ 107,288     $ 101,490     $ 93,117     $ 104,543  
Regular savings
     71,667       67,344       60,862       66,702  
Money market deposit accounts
     229,520       228,317       225,921       227,933  
Non-interest checking
     145,114       134,546       118,101       128,635  
Certificates of deposit
     149,046       154,944       174,805       162,253  
Total deposits
   $ 702,635     $ 686,641     $ 672,806     $ 690,066  


 
 
 
RVSB Reports Second Quarter Fiscal 2015 Profits
October 28, 2014
Page 8

COMPOSITION OF COMMERCIAL AND CONSTRUCTION LOANS
              
                         
         
Commercial
          
Commercial
  
         
Real Estate
    
Real Estate
    
& Construction
  
   
Commercial
    
Mortgage
    
Construction
    
Total
  
September 30, 2014
  
(Dollars in thousands)
  
Commercial
   $ 80,930     $ -     $ -     $ 80,930  
Commercial construction
     -       -       16,030       16,030  
Office buildings
     -       76,955       -       76,955  
Warehouse/industrial
     -       45,340       -       45,340  
Retail/shopping centers/strip malls
     -       60,581       -       60,581  
Assisted living facilities
     -       3,951       -       3,951  
Single purpose facilities
     -       95,870       -       95,870  
Land
     -       14,724       -       14,724  
Multi-family
     -       31,635       -       31,635  
One-to-four family
     -       -       2,813       2,813  
  Total
   $ 80,930     $ 329,056     $ 18,843     $ 428,829  
                                 
March 31, 2014
  
(Dollars in thousands)
  
Commercial
   $ 71,632     $ -     $ -     $ 71,632  
Commercial construction
     -       -       15,618       15,618  
Office buildings
     -       77,476       -       77,476  
Warehouse/industrial
     -       45,632       -       45,632  
Retail/shopping centers/strip malls
     -       63,049       -       63,049  
Assisted living facilities
     -       7,585       -       7,585  
Single purpose facilities
     -       93,766       -       93,766  
Land
     -       16,245       -       16,245  
Multi-family
     -       21,128       -       21,128  
One-to-four family
     -       -       3,864       3,864  
  Total
   $ 71,632     $ 324,881     $ 19,482     $ 415,995  

 
LOAN MIX
  
Sept. 30, 2014
    
June 30, 2014
    
Sept. 30, 2013
    
March 31, 2014
  
Commercial and construction
                        
  Commercial
   $ 80,930     $ 75,702     $ 70,510     $ 71,632  
  Other real estate mortgage
     329,056       327,287       348,257       324,881  
  Real estate construction
     18,843       18,347       11,850       19,482  
    Total commercial and construction
     428,829       421,336       430,617       415,995  
Consumer
                                
  Real estate one-to-four family
     94,536       93,550       90,550       93,007  
  Other installment
     29,422       32,107       1,976       24,486  
    Total consumer
     123,958       125,657       92,526       117,493  
                                 
Total loans
     552,787       546,993       523,143       533,488  
                                 
Less:
                                
  Allowance for loan losses
     12,001       12,281       13,696       12,551  
  Loans receivable, net
   $ 540,786     $ 534,712     $ 509,447     $ 520,937  

 
 
 
RVSB Reports Second Quarter Fiscal 2015 Profits
October 28, 2014
Page 9
 
 
DETAIL OF NON-PERFORMING ASSETS
                                
                                     
   
Northwest
    
Other
    
Southwest
    
Other
              
   
Oregon
    
Oregon
    
Washington
    
Washington
    
Other
    
Total
  
September 30, 2014
  
(dollars in thousands)
  
Non-performing assets
                                    
                                     
Commercial
   $ -     $ -     $ 112     $ -     $ -     $ 112  
Commercial real estate
     2,096       -       4,964       -       -       7,060  
Multi-family
     1,950       -       357       -       -       2,307  
Land
     -       800       -       -       -       800  
Consumer
     334       -       830       270       29       1,463  
Total non-performing loans
     4,380       800       6,263       270       29       11,742  
                                                 
REO
     374       28       2,629       674       -       3,705  
                                                 
Total non-performing assets
   $ 4,754     $ 828     $ 8,892     $ 944     $ 29     $ 15,447  

 
DETAIL OF SPEC CONSTRUCTION AND LAND DEVELOPMENT LOANS
              
                                     
   
Northwest
    
Other
    
Southwest
    
Other
              
   
Oregon
    
Oregon
    
Washington
    
Washington
    
Other
    
Total
  
September 30, 2014
  
(dollars in thousands)
  
Land and Spec Construction Loans
                                    
                                     
Land Development Loans
   $ 1,929     $ 1,167     $ 11,628     $ -     $ -     $ 14,724  
Spec Construction Loans
     -       -       2,131       202       -       2,333  
                                                 
Total Land and Spec Construction
   $ 1,929     $ 1,167     $ 13,759     $ 202     $ -     $ 17,057  

 
 
 
 
 
 
 
 
 
RVSB Reports Second Quarter Fiscal 2015 Profits
October 28, 2014
Page 10
 
   
At or for the three months ended
    
At or for the six months ended
  
SELECTED OPERATING DATA
  
Sept. 30, 2014
    
June 30, 2014
    
Sept. 30, 2013
    
Sept. 30, 2014
    
Sept. 30, 2013
  
                               
Efficiency ratio (4)
     85.81 %     90.27 %     95.74 %     87.99 %     103.07 %
Coverage ratio (6)
     87.57 %     82.21 %     79.77 %     84.88 %     72.55 %
Return on average assets (1)
     0.52 %     0.36 %     0.17 %     0.44 %     0.51 %
Return on average equity (1)
     4.26 %     2.98 %     1.65 %     3.62 %     4.88 %
                                         
NET INTEREST SPREAD
                                        
Yield on loans
     4.67 %     4.60 %     4.88 %     4.63 %     4.93 %
Yield on investment securities
     1.97 %     1.94 %     1.57 %     1.96 %     1.53 %
    Total yield on interest earning assets
     3.88 %     3.73 %     3.74 %     3.81 %     3.82 %
                                         
Cost of interest bearing deposits
     0.25 %     0.26 %     0.37 %     0.25 %     0.38 %
Cost of FHLB advances and other borrowings
     2.34 %     2.36 %     2.37 %     2.35 %     2.38 %
    Total cost of interest bearing liabilities
     0.34 %     0.35 %     0.46 %     0.34 %     0.47 %
                                         
Spread (7)
     3.54 %     3.38 %     3.28 %     3.47 %     3.35 %
Net interest margin
     3.61 %     3.46 %     3.37 %     3.54 %     3.44 %
                                         
PER SHARE DATA
                                        
Basic earnings per share (2)
   $ 0.05     $ 0.03     $ 0.02     $ 0.08     $ 0.09  
Diluted earnings per share (3)
   $ 0.05     $ 0.03     $ 0.02     $ 0.08     $ 0.09  
Book value per share (5)
     4.46       4.42       3.60       4.46       3.60  
Tangible book value per share (5)
     3.31       3.27       2.45       3.31       2.45  
Market price per share:
                                        
  High for the period
   $ 3.99     $ 4.03     $ 2.96     $ 4.03     $ 2.96  
  Low for the period
     3.67       3.38       2.42       3.38       2.27  
  Close for period end
     3.99       3.88       2.63       3.99       2.63  
Cash dividends declared per share
     -       -       -       -       -  
                                         
Average number of shares outstanding:
                                        
  Basic (2)
     22,388,753       22,382,595       22,364,120       22,385,691       22,361,058  
  Diluted (3)
     22,419,469       22,408,775       22,365,460       22,414,212       22,361,941  

 
(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.




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