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Riverview Financial Corporation Reports Second Quarter 2018 Financial Results

Mittwoch, 18.07.2018 21:20 von PR Newswire

PR Newswire

HARRISBURG, Pa., July 18, 2018 /PRNewswire/ -- Riverview Financial Corporation ("Riverview") (OTCQX: RIVE), today reported unaudited financial results at and for the three and six months ended June 30, 2018.  Riverview, which completed a merger with CBT Financial Corp. ("CBT") on October 1, 2017, reported net income of $2.8 million, or $0.31 per basic and diluted weighted average common share, for the second quarter of 2018, compared to net income of $179 thousand, or $0.04 per basic and diluted weighted average common share, for the comparable period of 2017.

(PRNewsfoto/Riverview Financial Corporation)

For the six months ended June 30, 2018, Riverview reported net income of $5.6 million, or $0.62 per basic and diluted weighted average common share, compared to a net loss of $388 thousand, or $(0.08) per basic and diluted weighted average common share, for the same period last year. The results for the first six months ended June 30, 2018 include pre-tax merger related costs of $461 thousand. The earnings increase was primarily a result of the inclusion of the results of operations for both Riverview and CBT for the six months ended June 30, 2018, compared to Riverview on a standalone basis for the same period last year. The year over year improvement was also a function of the recognition of higher loan interest income from achieving significant organic loan growth in 2017, excluding acquired loans from the merger, and the recognition of net accretion income on acquired assets and assumed liabilities. 

In addition to evaluating its results of operations in accordance with accounting principles generally accepted in the United States of America ("GAAP"), Riverview routinely supplements its evaluation with an analysis of certain non-GAAP financial measures, such as tangible book value per share and return on average tangible stockholders' equity. Riverview believes these non-GAAP financial measures provide information useful to investors in understanding its operating performance and trends. Where non-GAAP disclosures are used in this press release, a reconciliation to the comparable GAAP measure is provided in the accompanying tables. The non-GAAP financial measures Riverview uses may differ from the non-GAAP financial measures other financial institutions use to measure their results of operations.

HIGHLIGHTS

  • Successful completion of the conversion of the core processing system and rebranding of all products and services in the second quarter of 2018 as a result of combining systems and processes from the merger.
  • Successful deployment of new online and mobile banking platforms bankwide, resulting in a 100% increased enrollment in mobile banking customers during the second quarter of 2018.
  • Annualized return on average assets and return on average stockholders' equity were 0.97% and 10.17%, respectively, for the second quarter of 2018.
  • Tangible book value per share improved $0.49 or 5.8% to $8.99 at the end of the second quarter of 2018 compared to $8.50 at year end 2017.
  • Tax-equivalent net interest margin improved to 3.94% in the second quarter of 2018 compared to 3.58% for the same period last year.
  • Noninterest income improved to $2.5 million in the second quarter of 2018 compared to $2.0 million in the first quarter of 2018 and $0.8 million for the second quarter last year.
  • Income from trust and wealth management services totaled $454 thousand for the second quarter of 2018 compared to $225 thousand for the same period last year, an increase of 101.8%.
  • Noninterest-bearing deposits increased $13.2 million in the second quarter of 2018, or 33.8% annualized.
  • Continued asset quality improvement as nonperforming assets as a percentage of loans, net and other real estate owned declined to 0.89% at June 30, 2018 compared to 1.41% at June 30, 2017.

"We are pleased to report continued momentum in exceeding our earning expectations for the first six months of 2018 comparing actual results versus our proforma projections of the merger with CBT. With the successful conversion of the core processing system and rebranding of all products and services, we look forward to achieving operating efficiencies to increase long term shareholder value along with providing benefits for our customers by being able to offer new and enhanced products and services," said Kirk D. Fox, Chief Executive Officer. "We reinstated our dividend in the second quarter of 2018 after suspending it in the first quarter as a result of incurring significant one-time expenses in the fourth quarter of 2017. These expenses included those related to the re-measurement of net deferred tax assets from the enactment of new tax legislation along with acquisition costs from the merger with CBT. It is our goal to continue to pay a reasonable dividend without disrupting the delicate balance we must maintain between the payment of a dividend to shareholders and remaining a well-capitalized institution, which is critical in our dedicated efforts to continue building long term value for shareholders. The payment of a second quarter cash dividend represents an annualized yield of 3.2% based on the closing price of our stock on the dividend declaration date," concluded Fox.

Brett D. Fulk, President, added, "While we are certainly pleased to report record earnings for the year to date period ending June 30, 2018, perhaps even more gratifying from a long term perspective are the results of a successful data conversion during the second quarter.  From all indications, our customer base experienced limited disruption and the seamless transition was favorably received. Our fantastic team of highly dedicated employees has proven, once again, that a merger of equals is not only possible, but highly effective for the future benefit of your Company. Evidence of this stated success is net growth in the number of total deposit accounts during the second quarter, which was achieved following the aforementioned data conversion." Fulk continued, "as stated previously, we will continue to focus internally for as long as necessary to ensure the ongoing success of our merger with CBT, now operating as a division of Riverview Bank.  Additionally, we will continue to dedicate significant attention to balance sheet management, interest margin preservation, maintaining our current level of credit quality, as well as an ongoing review and analysis of our efficiency ratio.  While the continued flattening of the interest rate yield curve presents challenges, it is important to note that our loan generation opportunities remain robust, however we continue to stress credit quality and pricing over quantity.  Riverview will not yield to the temptation created during this economic cycle to grow by compromising appropriate pricing or credit standards."  In a final comment Fulk stated "while we have experienced increased interest in our stock since our 2017 capital raise and the merger with CBT, as evidenced by a marked increase in average daily trade volume, management continues to explore opportunities to create additional exposure for our stock and increased average trading volume."      

INCOME STATEMENT REVIEW

Tax-equivalent net interest income for the three and six months ended June 30 were $10.4 million and $21.9 million in 2018 compared to $5.0 million and $9.5 million in 2017.  The increase in tax-equivalent net interest income was primarily attributable to the growth in average earning assets from the merger and organic loan growth along with an improvement in the tax equivalent net interest margin. For the three months ended June 30, the tax-equivalent net interest margin increased to 3.94% in 2018 from 3.58% in 2017. The loan portfolio yield on a tax-equivalent basis improved to 4.95% in the second quarter of 2018 compared to 4.35% for the same period last year. The cost of funds increased 20 basis points comparing the second quarter of 2018 and 2017. Average earning asset growth outpaced that of average interest-bearing liabilities by $96.5 million comparing the three months ended June 30, 2018 and 2017. The tax-equivalent net interest margin for the six months ended June 30 was 4.16% in 2018 compared to 3.58% in 2017. The tax-equivalent net interest margin excluding purchase accounting adjustments would have been 3.62% in the first six months of 2018. The tax-equivalent yield on earnings assets was 4.86% and the cost of funds was 0.84% in the first six months of 2018. The tax-equivalent yield on the loan portfolio increased to 5.16% in 2018 compared to 4.32% in 2017. The tax-equivalent yield on the loan portfolio would have been 4.60% in the first half of 2018 excluding loan accretion of $2.6 million included in loan interest income related to acquired loans. Investments yielded 2.78% on a tax-equivalent basis in the first half of 2018 compared to 3.46% for the same period last year. The cost of deposits increased 18 basis points to 0.76% in 2018 from 0.58% in 2017. The growth in average earning assets outpaced that of average interest-bearing liabilities by $89.8 million comparing the first half of 2018 and 2017. Loans, net averaged $939.6 million in 2018 and $447.7 million in 2017. Average investments totaled $92.3 million in 2018 and $74.2 million in 2017. Average interest-bearing liabilities increased to $881.7 million in 2018 from $446.5 million in 2017.

For the quarter ended June 30, there was no provision for loan losses in 2018 compared to $519 thousand for the same period in 2017.  The provision for loan losses totaled $390 thousand for the six months ended June 30, 2018, compared to $1,124 thousand in 2017. The decrease in the provision for loan losses in 2018 was primarily influenced by a decrease in the net volume of loans originated in the first six months of 2018 versus 2017, coupled with continuing solid results and positive trends in asset quality.

 For the quarter ended June 30, noninterest income totaled $2,533 thousand in 2018, an increase of $1,731 thousand from $802 thousand in 2017. The increase in noninterest income for the quarter was due primarily to increases in services charges, fees and commissions of $1,359 thousand, trust income of $204 thousand, and bank owned life insurance investment income of $125 thousand.  For the six months ended June 30, noninterest income increased to $4,486 thousand in 2018 compared to $1,581 thousand in 2017. Wealth management income decreased $79 thousand comparing the first half of 2018 and 2017 due to the dissolution of a business acquired in 2016. Service charges and fees, and commissions and trust income improved $2,250 thousand and $384 thousand, respectively, comparing the first half of 2018 and 2017. Mortgage banking income in the first two quarters of 2018 improved to $359 thousand as compared to $229 thousand in 2017. Income from bank owned life insurance increased to $390 thousand in the first six months of 2018 compared to $147 thousand for the comparable period in 2017.

Noninterest expense increased $4,367 thousand, or 86.6%, to $9,408 thousand for the three months ended June 30, 2018, from $5,041 thousand for the same period last year.  The increase in noninterest expense for the quarter was due primarily to increases in salaries and employee benefits expense of $2,464 thousand and other expenses of $1,512 thousand.  The increases were primarily attributable to the merger with CBT due to increased operating costs of the larger company.  For the six months ended June 30, noninterest expense increased to $18,944 thousand in 2018 compared to $10,204 thousand in 2017. The majority of this increase relates to salaries and employee benefit expense, which was a result of the merger with CBT and related costs. Additions to facilities as a result of the CBT merger along with offices to support the lending teams were primarily responsible for the $854 thousand, or 66.7%, increase in occupancy and equipment costs. The majority of the $2,903 thousand increase in other expenses comparing the first six months of 2018 and 2017 was a result of the business combination with CBT.

BALANCE SHEET REVIEW

Total assets, loans, net and deposits totaled $1.2 billion, $939.9 million, and $1.0 billion, respectively, at June 30, 2018. For the three months ended June 30, 2018, total assets and deposits declined $19.4 million and $20.9 million, respectively, while loans, net increased $5.7 million. Year to date, loans, net decreased $16.1 million comparing the end of the second quarter of 2018 to year end 2017. Decreases in commercial loans of $9.6 million and residential loans of $9.5 million offset partially by an increase of $8.7 million in commercial real estate loans were primarily responsible for the majority of the decline. Loan originations in the first half of 2018 represented a more moderate pace as compared to the same period of 2017.  The reduction in loan growth was a result of management's decision to focus on improving margins on loan originations and maintaining strong underwriting standards.  Total investments were $87.9 million at June 30, 2018, compared to $93.2 million at December 31, 2017. Total deposits decreased $8.8 million in the first six months of 2018. Noninterest-bearing deposits increased $14.3 million, while interest-bearing deposits decreased $23.1 million.

Stockholders' equity totaled $110.5 million or $12.15 per share at June 30, 2018, $108.4 million or $11.93 per share at March 31, 2018, and $106.3 million or $11.72 per common share at December 31, 2017. The increase in equity in the first six months of 2018 was a result primarily of net income of $5.6 million offset partially by an increase of $793 thousand in the accumulated other comprehensive loss. Tangible stockholders' equity per common share increased to $8.99 per share at June 30, 2018, compared to $8.75 per share at March 31, 2018 and $8.50 per share at year-end 2017.  Dividends declared for the second quarter of 2018 amounted to $0.10 per share representing a dividend payout ratio of 32.3%.

ASSET QUALITY REVIEW

Nonperforming assets were $8.4 million, or 0.89% of loans, net and foreclosed assets at June 30, 2018 compared to $8.4 million or 0.90% at March 31, 2018 and $8.2 million, or 0.85% at December 31, 2017. This asset quality ratio remains significantly improved from 1.41%, at June 30, 2017. Adjusting for accruing restructured loans, nonperforming assets were $3.7 million, or 0.39% of loans, net and foreclosed assets at June 30, 2018, $3.1 million or 0.33% at March 31, 2018 and $2.7 million, or 0.28%, at December 31, 2017. The allowance for loan losses equaled $6.4 million, or 0.68% of loans, net at June 30, 2018, compared to $6.5 million or 0.70% at March 31, 2018 and $6.3 million, or 0.66% at December 31, 2017. Adding purchase accounting adjustments for credit deterioration on acquired loans to the allowance for loan losses would result in a ratio of 1.85% as a percentage of loans, net at June 30, 2018. The coverage ratio, allowance for loan losses as a percentage of nonperforming assets, was 76.3% at June 30, 2018. Excluding accruing restructured loans, the coverage ratio would be 173.2% at June 30, 2018. Loans charged-off, net of recoveries, for the three and six months ended June 30, 2018, equaled $114 thousand and $295 thousand, compared to $14 thousand and $22 thousand for the same period last year. 

Riverview Financial Corporation is the parent company of Riverview Bank and its operating divisions Citizens Neighborhood Bank, CBT Bank, Riverview Wealth Management and CBT Financial and Trust Management. An independent community bank, Riverview Bank serves the Pennsylvania market areas of Berks, Blair, Centre, Clearfield, Dauphin, Huntingdon, Lebanon, Lycoming, Northumberland, Perry, Schuylkill and Somerset Counties through 30 community banking offices and three limited purpose offices. Each office, interdependent with the community, offers a comprehensive array of financial products and services to individuals, businesses, not-for-profit organizations and government entities. The Wealth Management and Trust divisions, with assets under management exceeding $350 million, provide trust and investment advisory services to the general public. Riverview's business philosophy includes offering direct access to senior management and other officers and providing friendly, informed and courteous service, local and timely decision making, flexible and reasonable operating procedures and consistently applied credit policies. The Company's common stock trades on the OTCQX Market under the symbol "RIVE". The Investor Relations site can be accessed at https://www.riverviewbankpa.com/ .

 

Safe Harbor Forward-Looking Statements:

We make statements in this press release, and we may from time to time make other statements regarding our outlook or expectations for future financial or operating results and/or other matters regarding or affecting Riverview Financial Corporation, Riverview Bank, and its subsidiaries (collectively, "Riverview") that may be considered "forward-looking statements" as defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements may be identified by the use of such words as "believe," "expect," "anticipate," "should," "planned," "estimated," "intend" and "potential." For these statements, Riverview claims the protection of the statutory safe harbors for forward-looking statements.

Riverview cautions you that a number of important factors could cause actual results to differ materially from those currently anticipated in any forward-looking statement. Such factors include, but are not limited to: prevailing economic and political conditions, particularly in our market area; credit risk associated with our lending activities; changes in interest rates, loan demand, real estate values and competition; changes in accounting principles, policies, and guidelines; changes in any applicable law, rule, regulation or practice with respect to tax or legal issues; and other economic, competitive, governmental, regulatory and technological factors affecting Riverview' operations, pricing, products and services and other factors that may be described in Riverview' Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q as filed with the Securities and Exchange Commission from time to time.

In addition to these risks, acquisitions and business combinations present risks other than those presented by the nature of the business acquired. Acquisitions and business combinations may be substantially more expensive to complete than originally anticipated, and the anticipated benefits may be significantly harder-or take longer-to achieve than expected. As regulated financial institutions, our pursuit of attractive acquisition and business combination opportunities could be negatively impacted by regulatory delays or other regulatory issues. Regulatory and/or legal issues related to the pre­acquisition operations of an acquired or combined business may cause reputational harm to Riverview following the acquisition or combination, and integration of the acquired or combined business with ours may result in additional future costs arising as a result of those issues. 

The forward-looking statements are made as of the date of this release, and, except as may be required by applicable law or regulation, Riverview assumes no obligation to update the forward-looking statements or to update the reasons why actual results could differ from those projected in the forward-looking statements.

In addition to evaluating its results of operations in accordance with accounting principles generally accepted in the United States of America ("GAAP"), Riverview routinely presents and supplements its evaluation with an analysis of certain non-GAAP financial measures, such as tangible stockholders' equity and core net income ratios. The reported results for the three and six months ended June 30, 2018 and 2017, contain items which Riverview considers non-core, namely net gains on sales of investment securities available-for-sale, acquisition related expenses and the adjustment to tax expense due to the enactment of the Tax Act. Riverview presents the non-GAAP financial measures because it believes that these measures provide useful and comparative information to assess trends in Riverview's results of operation.  Presentation of these non-GAAP financial measures is consistent with how Riverview evaluates its performance internally and these non-GAAP financial measures are frequently used by securities analysts, investors and other interested parties in evaluation of companies in Riverview's industry. Where non-GAAP measures are used in this press release, reconciliations to the comparable GAAP measures are provided in the accompanying tables. The non-GAAP financial measures Riverview uses may differ from similarly titled non-GAAP financial measures of other financial institutions.  These non-GAAP financial measures would not be considered a substitute for GAAP basis measures, and Riverview strongly encourages a review of its condensed consolidated financial statements in their entirety.  Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP measures are presented in the tabular material that follows.

 

 

[TABULAR MATERIAL FOLLOWS]

 

 

Summary Data

Riverview Financial Corporation

Five Quarter Trend

(In thousands, except per share data)








Jun 30

Mar 31

Dec 31

Sept 30

Jun 30


2018

2018

2017

2017

2017

Key performance data:












Per common share data:






Net income (loss)

$  0.31

$  0.31

$  (0.55)

$  0.09

$  0.04

Core net income (loss) (1)

$  0.31

$  0.35

$  0.13

$  0.09

$  0.05

Cash dividends declared

$  0.10

$  0.00

$  0.14

$  0.14

$  0.14

Book value

$12.15

$11.93

$11.72

$11.73

$11.79

Tangible book value (1)

$8.99

$8.75

$8.50

$10.47

$10.51

Market value:






High

$12.75

$13.85

$13.65

$13.50

$14.65

Low

$11.85

$12.31

$12.95

$12.15

$11.81

Closing

$12.65

$12.31

$13.15

$13.20

$13.48

Market capitalization

$115,052

$111,827

$119,262

$64,576

$65,739

Common shares outstanding

9,094,986

9,084,277

9,069,363

4,892,143

4,876,774







Selected ratios:












Return on average stockholders' equity

10.17%

10.59%

(17.47)%

2.77%

1.25%







Core return on average stockholders' equity (1)

10.13%

11.88%

4.09%

3.06%

1.33%







Return on average tangible stockholders' equity (1)

13.78%

14.50%

(23.87)%

3.10%

0.95%







Core return on average tangible stockholders' equity (1)

13.73%

16.27%

5.59%

3.43%

1.49%







Return on average assets

0.97%

0.98%

(1.67)%

0.24%

0.12%







Core return on average assets (1)

0.96%

1.10%

0.39%

0.26%

0.12%







Stockholders' equity to total assets

9.59%

9.26%

9.13%

8.42%

9.15%







Efficiency ratio (2)

71.46%

69.28%

100.39%

80.85%

86.53%







Nonperforming assets to loans, net, and foreclosed assets

 

0.89%

 

0.90%

 

0.85%

1.26%

1.41%







Net charge-offs to average loans, net

0.05%

0.08%

0.04%

0.03%

0.01%







Allowance for loan losses to loans, net

0.68%

0.70%

0.66%

0.96%

0.96%







Earning assets yield (FTE) (3)

4.67%

5.05%

4.67%

4.22%

4.16%







Cost of funds

0.89%

0.80%

0.74%

0.76%

0.69%







Net interest spread (FTE) (3)

3.78%

4.25%

3.93%

3.46%

3.47%







Net interest margin (FTE) (3)

3.94%

4.38%

4.05%

3.57%

3.58%













(1)

See Reconciliation of Non-GAAP financial measures.

(2)

Total noninterest expense less amortization of intangible assets divided by tax-equivalent net interest income and noninterest income less net gain (loss) on sale of investment securities available-for-sale.

(3)

Tax-equivalent adjustments were calculated using the prevailing federal statutory tax rate.

 

 



Riverview Financial Corporation

Consolidated Statements of Income (Loss)

(In thousands, except per share data)





Six Months Ended

Jun 30


Jun 30


2018


2017

Interest income:




Interest and fees on loans:




Taxable

$23,467


$9,274

Tax-exempt

469


215

Interest and dividends on investment securities:




Taxable

1,065


1,130

Tax-exempt

163


93

Dividends



3

Interest on interest-bearing deposits in other banks

180


47

Interest on federal funds sold

20


10

Total interest income

25,364


10,772





Interest expense:




Interest on deposits

3,277


1,200

Interest on short-term borrowings

30


85

Interest on long-term debt

368


153

Total interest expense

3,675


1,438

Net interest income

21,689


9,334

Provision for loan losses

390


1,124

Net interest income after provision for loan losses

21,299


8,210





Noninterest income:




Service charges, fees and commissions

2,879


629

Commissions and fees on fiduciary activities

445


61

Wealth management income

373


452

Mortgage banking income

359


229

Life insurance investment income

390


147

Net gain (loss) on sale of investment securities available-for-sale

40


63

Total noninterest income

4,486


1,581





Noninterest expense:




Salaries and employee benefits expense

10,543


5,593

Net occupancy and equipment expense

2,134


1,280

Amortization of intangible assets

441


235

Net cost of operation of other real estate owned

1


174

Other expenses

5,825


2,922

Total noninterest expense

18,944


10,204

Income (loss) before income taxes

6,841


(413)

Provision for income tax expense (benefit)

1,243


(25)

Net income (loss)

$5,598


$(388)

    Other comprehensive income (loss):




Unrealized gain (loss) on investment securities available-for-sale

$(963)


$1,758

Reclassification adjustment for (gain) loss included in net income

(40)


(63)

Change in pension liability




Income tax expense (benefit) related to other comprehensive income (loss)

(210)


576

Other comprehensive income (loss), net of income taxes

(793)


1,119

Comprehensive income (loss)

$4,805


$731





Per common share data:




Net income (loss):




         Basic

$0.62


$(0.08)

         Diluted

$0.62


$(0.08)

Average common shares outstanding:




         Basic

9,084,054


3,555,629

         Diluted

9,136,004


3,555,629

Cash dividends declared

$0.10


$0.28














 

 

Riverview Financial Corporation

Consolidated Statements of Income (Loss)

(In thousands, except per share data)








Three months ended

Jun 30

Mar 31

Dec 31

Sept 30

Jun 30



2018

2018

2017

2017

2017


Interest income:







Interest and fees on loans:







Taxable

$  11,226

$  12,241

$  11,483

$  5,717

$  4,989


Tax-exempt

235

234

239

146

107


Interest and dividends on investment securities available-for-sale:







Taxable

542

523

548

477

566


Tax-exempt

81

82

88

47

46


Dividends







Interest on interest-bearing deposits in other banks

101

79

43

31

24


Interest on federal funds sold

10

10


2

4


Total interest income

12,195

13,169

12,401

6,420

5,736









Interest expense:







Interest on deposits

1,723

1,554

1,468

821

668


Interest on short-term borrowings


30

33

112

63


Interest on long-term debt

192

176

173

75

78


Total interest expense

1,915

1,760

1,674

1,008

809


Net interest income

10,280

11,409

10,727

5,412

4,927


Provision for loan losses


390

1,000

610

519


Net interest income after provision for loan losses

10,280

11,019

9,727

4,802

4,408









Noninterest income:







Service charges, fees and commissions

1,651

1,228

1,138

270

292


Commissions and fees on fiduciary activities

235

210

252

31

31


Wealth management income

219

154

201

179

194


Mortgage banking income

189

170

226

205

147


Life insurance investment income

199

191

195

107

74


Net gain (loss) on sale of investment securities available-for-sale

40


(17)

43

64


        Total noninterest income

2,533

1,953

1,995

835

802









Noninterest expense:







Salaries and employee benefits expense

5,221

5,322

6,675

2,928

2,757


Net occupancy and equipment expense

1,012

1,122

1,376

615

634


Amortization of intangible assets

220

221

232

71

71


Net cost of operation of other real estate owned

2

(1)

11

(13)

138


Other expenses

2,953

2,872

4,895

1,566

1,441


Total noninterest expense

9,408

9,536

13,189

5,167

5,041


Income (loss) before income taxes

3,405

3,436

(1,467)

470

169


Income tax expense (benefit)

618

625

3,457

69

(10)


Net income (loss)

$2,787

$2,811

$(4,924)

$401

$179









Other comprehensive income (loss):







Unrealized gain (loss) on investment securities available-for-sale

$112

$(1,075)

$(237)

$(50)

$1,246


Reclassification adjustment for (gain) loss included in net income

(40)


17

(43)

(64)


Change in pension liability



(54)




Income tax expense (benefit) related to other comprehensive income (loss)

15

(225)

(93)

(32)

402


Other comprehensive income (loss), net of income taxes

57

(850)

(181)

(61)

780


Comprehensive income (loss)

$ 2,844

$ 1,961

$ (5,105)

$  340

$  959









Per common share data:







Net income (loss):







         Basic

$  0.31

$  0.31

$  (0.55)

$  0.09

$  0.04


         Diluted

$ 0.31

$ 0.31

$ (0.55)

$  0.09

$  0.04


Average common shares outstanding:







         Basic

9,089,011

9,079,043

8,994,617

4,880,676

3,655,446


         Diluted

9,134,248

9,137,706

8,994,617

4,945,456

3,726,939


Cash dividends declared

$  0.10

$  0.00

$  0.14

$  0.14

$  0.14























 

 

Riverview Financial Corporation

Details of Net Interest and Net Interest Margin

(In thousands, fully taxable equivalent basis)







Three months ended

Jun 30

Mar 31

Dec 31

Sept 30

Jun 30


2018

2018

2017

2017

2017

Net interest income:






Interest income






Loans, net:






Taxable

$11,226

$ 12,241

$ 11,483

$ 5,717

$ 4,989

Tax-exempt

298

296

362

221

162

Total loans, net

11,524

12,537

11,845

5,938

5,151

Investments:






Taxable

542

523

548

477

566

Tax-exempt

102

104

133

71

70

Total investments

644

627

681

548

636

Interest on interest-bearing balances in other banks

101

79

43

31

24

Federal funds sold

10

10


2

4

Total interest income

12,279

13,253

12,569

6,519

5,815

Interest expense:






Deposits

1,723

1,554

1,468

821

668

Short-term borrowings


30

33

112

63

Long-term debt

192

176

173

75

78

Total interest expense

1,915

1,760

1,674

1,008

809

Net interest income

$10,364

$11,493

$10,895

$5,511

$5,006







Yields on earning assets:






Loans, net:






Taxable

5.02%

5.46%

4.99%

4.40%

4.36%

Tax-exempt

3.29%

3.23%

3.91%

3.94%

3.99%

Total loans, net

4.95%

5.38%

4.94%

4.38%

4.35%

Investments:






Taxable

2.82%

2.76%

2.65%

3.17%

3.35%

Tax-exempt

2.77%

2.66%

3.04%

4.90%

4.89%

Total investments

2.81%

2.74%

2.71%

3.33%

3.47%

Interest-bearing balances with banks

1.50%

1.36%

0.97%

1.35%

0.95%

Federal funds sold

1.56%

1.55%


1.71%

0.94%

Total earning assets

4.67%

5.05%

4.67%

4.22%

4.16%

Costs of interest-bearing liabilities:






Deposits

0.81%

0.72%

0.67%

0.67%

0.62%

Short-term borrowings


1.67%

1.39%

1.32%

1.11%

Long-term debt

5.87%

5.41%

5.17%

4.16%

2.81%

Total interest-bearing liabilities

0.89%

0.80%

0.74%

0.76%

0.69%

Net interest spread

3.78%

4.25%

3.93%

3.46%

3.47%

Net interest margin

3.94%

4.38%

4.05%

3.57%

3.58%

 

 

Riverview Financial Corporation

Consolidated Balance Sheets

(In thousands, except per share data)














Jun 30

Mar 31

Dec 31

Sept 30

Jun 30

At period end

2018

2018

2017

2017

2017







Assets:






Cash and due from banks

$  13,139

$  14,396

$  9,413

$  8,425

$  9,613

Interest-bearing balances in other banks

23,481

40,724

16,373

10,741

6,064

Federal funds sold


4,729




Investment securities available-for-sale

87,908

88,773

93,201

56,874

67,852

Loans held for sale

873

610

254

519

1,037

Loans, net

939,887

934,190

955,971

560,187

504,749

Less: allowance for loan losses

6,401

6,515

6,306

5,404

4,834

Net loans

933,486

927,675

949,665

554,783

499,915

Premises and equipment, net

18,542

18,714

18,631

12,163

12,132

Accrued interest receivable

2,786

2,865

3,237

1,995

1,651

Goodwill

24,754

24,754

24,754

5,079

5,079

Other intangible assets, net

3,935

4,155

4,376

1,099

1,170

Other assets

42,900

43,771

43,703

29,701

23,728

Total assets

$1,151,804

$1,171,166

$1,163,607

$681,379

$628,241













Liabilities:






Deposits:






Noninterest-bearing

$  170,232

$  157,011

$  155,895

$  76,214

$  76,096

Interest-bearing

847,490

881,594

870,585

498,736

447,799

Total deposits

1,017,722

1,038,605

1,026,480

574,950

523,895

Short-term borrowings



6,000

37,250

30,000

Long-term debt

13,091

13,160

13,233

6,503

11,589

Accrued interest payable

449

466

468

213

194

Other liabilities

10,075

10,535

11,170

5,084

5,048

Total liabilities

1,041,337

1,062,766

1,057,351

624,000

570,726







Stockholders' equity:






Preferred stock






Common stock

100,790

100,660

100,476

45,427

45,240

Capital surplus

424

422

423

243

235

Retained earnings

11,625

9,747

6,936

12,848

13,118

Accumulated other comprehensive income (loss)

(2,372)

(2,429)

(1,579)

(1,139)

(1,078)

Total stockholders' equity

110,467

108,400

106,256

57,379

57,515

Total liabilities and stockholders' equity

$1,151,804

$1,171,166

$1,163,607

$681,379

$628,241








 

 


Riverview Financial Corporation

Consolidated Balance Sheets

(In thousands except per share data)








Jun 30

Mar 31

Dec 31

Sept 30

Jun 30

Average quarterly balances

2018

2018

2017

2017

2017







Assets:






Loans, net:






Taxable

$897,085

$908,574

$913,623

$515,494

$458,702

Tax-exempt

36,274

37,153

36,750

22,246

16,285

Total loans, net

933,459

945,727

950,373

537,740

474,987

Investments:






Taxable

77,061

76,952

82,180

59,612

67,753

Tax-exempt

14,784

15,836

17,345

5,746

5,747

Total investments

91,845

92,788

99,525

65,358

73,500

Interest-bearing balances with banks

27,067

23,607

17,615

9,143

10,137

Federal funds sold

2,568

2,617

48

465

1,709

Total earning assets

1,054,939

1,064,739

1,067,561

612,706

560,333

Other assets

99,492

98,503

101,120

52,770

49,382

Total assets

$1,154,431

$1,163,242

$1,168,681

$665,476

$609,715







Liabilities and stockholders' equity:






Deposits:






Interest-bearing

$853,986

$875,985

$873,596

$483,648

$435,033

Noninterest-bearing

166,828

149,123

150,515

77,819

77,440

Total deposits

1,020,814

1,025,108

1,024,111

561,467

512,473

Short-term borrowings


7,297

9,403

33,707

22,838

Long-term debt

13,124

13,205

13,271

7,151

11,146

Other liabilities

10,573

9,996

10,053

5,700

5,909

Total liabilities

1,044,511

1,055,606

1,056,838

608,025

552,366

Stockholders' equity

109,920

107,636

111,843

57,451

57,349

Total liabilities and stockholders' equity

$1,154,431

$1,163,242

$1,168,681

$665,476

$609,715

 

 

Riverview Financial Corporation

Asset Quality Data

(In thousands)








Jun 30

Mar 31

Dec 31

Sept 30

Jun 30


2018

2018

2017

2017

2017

At quarter end:






Nonperforming assets:






Nonaccrual  loans

$2,070

$2,629

$1,745

$1,765

$1,702

Accruing restructured loans

4,693

5,310

5,478

5,168

5,199

Accruing loans past due 90 days or more

1,536

393

693


35

Foreclosed assets

90

92

236

144

205

Total nonperforming assets

$8,389

$8,424

$8,152

$7,077

$7,141







Three months ended:






Allowance for loan losses:






Beginning balance

$6,515

$6,306

$5,404

$4,834

$4,329

Charge-offs

166

226

142

42

21

Recoveries

52

45

44

2

7

Provision for loan losses


390

1,000

610

519

Ending balance

$6,401

$6,515

$6,306

$5,404

$4,834













 

 


Riverview Financial Corporation

Reconciliation of Non-GAAP Financial Measures

(In thousands, except per share data)








Jun 30

Mar 31

Dec 31

Sept 30

Jun 30

Three months ended:

2018

2018

2017

2017

2017

Core net income (loss) per common share:






Net income (loss)

$2,787

$2,811

$(4,924)

$401

$179

Dividends on preferred stock





(186)

Net income (loss) available to common stockholders

2,787

2,811

(4,924)

401

(7)

Undistributed loss (income) allocated to preferred stockholders





128

Income (loss) allocated to common stockholders

2,787

2,811

(4,924)

401

121

Adjustments:






Less: Gain (loss) on sale of investment securities, net of tax

32


(11)

28

42

Add: Acquisition related expenses, net of tax

22

342

2,177

70

111

Add: Tax Cuts and Jobs Act tax expense



3,888



Net income (loss) Core

$2,777

$3,153

$1,152

$443

$190







Average common shares outstanding

9,089,011

9,079,043

8,994,617

4,880,676

3,655,446

Core net income (loss) per common share

$  0.31

$  0.35

$  0.13

$  0.09

$  0.05







Tangible book value:






Total stockholders' equity

$110,467

$108,400

$106,256

$57,379

$57,515

Less: Goodwill

24,754

24,754

24,754

5,079

5,079

Less: Other intangible assets, net

3,935

4,155

4,376

1,099

1,170

Total tangible stockholders' equity

$81,778

$79,491

$77,126

$51,201

$51,266







Common shares outstanding

9,094,986

9,084,277

9,069,363

4,892,143

4,876,774

Tangible book value per share

$  8.99

$  8.75

$  8.50

$  10.47

$  10.51







Core return on average stockholders' equity:






Net income (loss) GAAP

$2,787

$2,811

$(4,924)

$401

$121

Adjustments:






Less: Gain (loss) on sale of investment securities, net of tax

32


(11)

28

42

Add: Acquisition related expenses, net of tax

22

342

2,177

70

111

Add: Tax Cuts and Jobs Act tax expense



3,888



Net income (loss) Core

$2,777

$3,153

$1,152

$443

$190







Average stockholders' equity

$  109,920

$  107,636

$  111,843

$  57,451

$  57,349

Core return on average stockholders' equity

10.13%

11.88%

4.09%

3.06%

1.33%







Return on average tangible equity:






Net income (loss) GAAP

$2,787

$2,811

$(4,924)

$       401

$       121







Average stockholders' equity

$109,920

$ 107,636

$ 111,843

$ 57,451

$ 57,349

Less: average intangibles

28,800

29,021

30,013

6,213

6,284

Average tangible stockholders' equity

$81,120

$  78,615

$  81,830

$  51,238

$  51,065







Return on average tangible stockholders' equity

13.78%

14.50%

(23.87)%

3.10%

0.95%







Core return on average tangible stockholders' equity:






Net income (loss) GAAP

$2,787

$2,811

$(4,924)

$401

$121

Adjustments:






Less: Gain (loss) on sale of investment securities, net of tax

32


(11)

28

42

Add: Acquisition related expenses, net of tax

22

342

2,177

70

111

Add: Tax Cuts and Jobs Act tax expense



3,888



Net income (loss) Core

$2,777

$3,153

$1,152

$443

$190







Average stockholders' equity

$109,920

$ 107,636

$ 111,843

$  57,451

$  57,349

Less: average intangibles

28,800

29,021

30,013

6,213

6,284

Average tangible stockholders' equity

$81,120

$  78,615

$  81,830

$  51,238

$  51,065







Core return on average tangible stockholders' equity

13.73%

16.27%

5.59%

3.43%

1.49%







Core return on average assets:






Net income (loss) GAAP

$2,787

$2,811

$(4,924)

$401

$121

Adjustments:






Less: Gain (loss) on sale of investment securities, net of tax

32


(11)

28

42

Add: Acquisition related expenses, net of tax

22

342

2,177

70

111

Add: Tax Cuts and Jobs Act tax expense



3,888



Net income (loss) Core

$2,777

$3,153

$1,152

$443

$190







Average assets

$1,154,431

$  1,163,242

$  1,168,681

$  665,476

$  609,715

Core return on average assets

0.96%

1.10%

0.39%

0.26%

0.12%

 

 

 

 

Riverview Financial Corporation

Reconciliation of Non-GAAP Financial Measures

(In thousands, except per share data)







Jun 30

Jun 30



2018

2017

Six months ended:








Core net income per common share:




Net income (loss)


$5,598

$(388)

Dividends on preferred stock



(371)

Net income available to common stockholders


5,598

(759)

Undistributed loss allocated to preferred stockholders



475

Income allocated to common stockholders


5,598

(284)

Adjustments:




   Less: Gains on sale of investment securities, net of tax


31

42

   Add: Acquisition related expenses, net of tax


364

178

   Add: Tax Cuts and Jobs Act of 2017 tax expense




Net income (loss) core


$5,931

$(148)





Average common shares outstanding


9,084,054

3,555,629





Core net income (loss) per common share


$0.66

$(0.05)





 

 

 

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SOURCE Riverview Financial Corporation