Riverview Bancorp Inc Reports Operating Results (10-Q)
Riverview Bancorp Inc has a market cap of $29.4 million; its shares were traded at around $2.69 with and P/S ratio of 0.5. Riverview Bancorp Inc had an annual average earning growth of 8.8% over the past 10 years.
Highlight of Business Operations:Financial Highlights. Net loss for the three months ended December 31, 2009 was $1.3 million, or $0.12 per diluted share, compared to net income of $1.5 million, or $0.14 per diluted share, for the three months ended December 31, 2008. Net interest income after provision for loan losses decreased $2.9 million to $4.2 million for the three months ended December 31, 2009 compared to $7.2 million for the same quarter last year. Non-interest income decreased for the quarter-ended December 31, 2009 compared to the same quarter last year due primarily to a $456,000 OTTI charge taken on an investment security. Non-interest expense increased $885,000 to $7.8 million for the three months ended December 31, 2009 compared to $6.9 million for the same quarter last year. The $885,000 increase was due to increases in the FDIC insurance premiums of $248,000 and additional professional fees and cost associated with REO properties of $689,000 which were partially offset by a decrease in compensation expense.
Net loss for the nine months ended December 31, 2009 was $741,000, or $0.07 per diluted share, compared to a net loss of $1.9 million, or $0.18 per diluted share for the nine months ended December 31, 2008. Net interest income after loan loss provision increased $2.0 million to $16.3 million for the nine months ended December 31, 2009 compared to $14.2 million for the same period in prior year. Non-interest income increased $2.6 million for the nine months ended December 31, 2009 compared to the same prior year period. The increase in non-interest expense is due primarily to $3.4 million in OTTI charges taken in prior year compared to a $915,000 OTTI charge taken in the current fiscal year. Non-interest expense increased $2.8 million for the nine months ended December 31, 2009 compared to the same prior year period due primarily to an increase in FDIC insurance premiums and REO related expenses.
Investment securities available for sale totaled $6.9 million and $8.5 million at December 31, 2009 and March 31, 2009, respectively. During the quarter, the Company recognized a non-cash OTTI charge on an investment security of $456,000. The investment security is a trust preferred pooled security with a fair market value of $1.2 million secured by the debentures issued by bank holding companies. For the nine months ended December 31, 2009, the Company recognized a total of $915,000 in OTTI charges on this investment security. The Company reviews investment securities for the presence of OTTI, taking into consideration current market conditions, extent and nature of change in fair value, issuer rating changes and trends, current analysts evaluations, the Company s intentions or requirements to sell the investments, as well as other factors. Management believes it is possible that a substantial portion of the principal and interest will be received and the Company does not intend to sell this security and it is not more likely than not that the Company will be required to sell this security before the anticipated recovery of the remaining amortized cost basis. The Company compared the amortized cost basis of the security to the present value of the revised expected cash flows, discounted using the current pre-impairment yield. The revised expected cash flow estimates were based primarily on an analysis of default rates, prepayment speeds and third-party analytical reports. In determining the expected default rates and prepayment speeds, management evaluated, among other things, the individual issuer s financial condition including capital levels, nonperforming assets amounts, loan loss reserve levels, and portfolio composition and concentrations. Management does not believe that the recognition of this OTTI charge has any other implications for the Company s business fundamentals or its outlook. For additional information on our Level 3 fair value measurements see “Fair Value of Level 3 Assets” included in Item 2.
Loans receivable, net, totaled $721.2 million at December 31, 2009, compared to $784.1 million at March 31, 2009, a decrease of $62.9 million due primarily to the Company s planned balance sheet restructuring strategy, which includes reducing the loan portfolio to preserve capital and liquidity. Loan originations totaling $39.9 million during the current quarter ended December 31, 2009 were offset by scheduled maturities and pay downs on loans as well as the transfer of certain loans to REO. The Company continued its focus on growing commercial business and commercial real estate loans and reducing construction and land development loans. The total commercial real estate loan portfolio was $343.0 million
Prepaid expenses and other assets were $9.0 million at December 31, 2009 compared to $2.5 million at March 31, 2009. The increase was primarily due to $5.1 million in payments made to the FDIC for the Bank s estimated prepayment of FDIC insurance assessments for the years 2010, 2011 and 2012 that is included in prepaid expenses at December 31, 2009.
Deposit accounts totaled $679.6 million at December 31, 2009, compared to $670.1 million at March 31, 2009. During the nine months ended December 31, 2009, the Company paid off $19.9 million in brokered deposits. The Company had no wholesale-brokered deposits in its deposit mix as of December 31, 2009. The Company s focus on increasing customer deposits has also continued in the past quarter. Customer branch deposits increased $44.7 million from March 31, 2009 to December 31, 2009 despite the general downturn in the real estate market as well as the overall economy. This growth was attributable to gains in both new relationships and the deepening of existing customer relationships. Core branch deposits (comprised of all demand, savings and interest checking accounts, plus all time deposits and excludes wholesale-brokered deposits, Trust account deposits, Interest on Lawyer Trust Accounts (“IOLTA”), public funds and internet based deposits) account for 95.3% of total deposits a
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