Press Release

Riverview Financial Corporation Reports Record Earnings In 2018

Company Release - 1/24/2019 8:30 AM ET

HARRISBURG, Pa., Jan. 24, 2019 /PRNewswire/ -- Riverview Financial Corporation (the "Company" or "Riverview") (NASDAQ: RIVE), today reported unaudited financial results at and for the three months and year ended December 31, 2018.  The reported annual net income of $10.9 million, or $1.19 per basic and diluted weighted average common share, is the highest level of earnings achieved in the Company's history. Return on average assets, return on average stockholders' equity and return on average tangible equity were 0.94%, 9.81% and 13.23% for the twelve months ended December 31, 2018. For the fourth quarter of 2018, net income amounted to $2.5 million, or $0.27 per basic and diluted weighted average common share.

(PRNewsfoto/Riverview Financial Corporation)

In comparison, Riverview, which completed an acquisition of CBT Financial Corp. ("CBT") on October 1, 2017, reported a net loss of $4.9 million, or $(0.91) per basic and diluted weighted average common share for the year ended December 31, 2017. For the fourth quarter of 2017, the Company reported a net loss of $4.9 million, or $(0.55) per basic and diluted weighted average common share. The losses reported for the three months and year ended December 31, 2017 were primarily a result of recognizing costs associated with the merger along with the earnings impact of changes in federal tax legislation in the fourth quarter of 2017. Pre-tax merger related expenses amounted to $3.7 million in 2017. In addition, a $3.9 million, or $(0.43) per share, charge to income tax expense was recorded related to the re-measurement of net deferred tax assets resulting from the newly enacted Tax Cuts and Jobs Act passed on December 22, 2017. 

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

  • Tangible book value per share improved $0.89, or 10.5%, to $9.39 at year-end 2018 compared to $8.50 at year-end 2017.
  • Tax-equivalent net interest margin improved to 4.30% and 4.19% for the three and twelve month ended December 31, 2018 compared to 4.05% and 3.76% for the same period last year.
  • For the quarter ended December 31, noninterest income totaled $2,340 thousand in 2018, an increase of $345 thousand from $1,995 thousand in 2017. For years ended December 31, noninterest income increased to $8,880 thousand in 2018 compared to $4,411 thousand in 2017.
  • Continued improvement in asset quality as nonperforming assets as a percentage of loans, net and other real estate owned was 0.81% in the fourth quarter of 2018, the lowest level over the past four quarters.
  • Riverview's common stock began actively trading on the Global Market of the Nasdaq Stock Market LLC on August 14, 2018. 
  • Riverview incurred non-recurring expenses of $281 thousand in the fourth quarter of 2018 associated with severance agreements of two employees. 

"I am extremely pleased with our Company's performance in 2018 as we achieved the highest level of earnings ever reported despite focusing our efforts on integrating systems, policies and procedures associated with the acquisition of CBT Financial Corp. In addition to this financial accomplishment, we took a significant step in enhancing shareholder value as on August 14, 2018, our Company's common stock began trading on the Nasdaq Stock Market LLC. This action of listing on the Nasdaq Global Market provides many advantages including increased liquidity for existing shareholders, potential broadening of our shareholder base by attracting new retail investors and increasing the appeal of our Company stock to institutional investors." said Brett D. Fulk, President and Chief Executive Officer. "With respect to current and future strategic initiatives, we recently instituted a treasury management function to better serve our commercial customers and introduced mobile banking and a social media platform for our retail customer base. As part of the strategic plan for 2019, major areas of focus will be on improving our delivery system through conducting and acting on a distribution network repositioning study, performing a comprehensive cost savings analysis aimed at improving operating efficiency, designing and implementing low cost deposit products and building out existing sources of noninterest revenue while developing new and alternative revenue sources. As we reflect on the accomplishments of the past year, we look forward to 2019 and the many possibilities it presents. We are continually looking for new organic and inorganic opportunities that will offer strong profitability growth potential and enhance shareholder value in the near term and beyond," concluded Fulk.

INCOME STATEMENT REVIEW

Tax-equivalent net interest income for the three and twelve months ended December 31 was $11.4 million and $44.2 million in 2018 compared to $10.9 million and $25.9 million in 2017.  The increase in tax-equivalent net interest income was primarily attributable to the net growth in average earning assets over that of average interest-bearing liabilities primarily due to the merger coupled with an improvement in the tax equivalent net interest margin. For the three months ended December 31, the tax-equivalent net interest margin increased to 4.30% in 2018 from 4.05% in 2017. The loan portfolio yield on a tax-equivalent basis improved to 5.51% in the fourth quarter of 2018 compared to 4.94% for the same period last year. The cost of funds increased 28 basis points comparing the fourth quarter of 2018 and 2017 as a result of increased market rates and heightened competition. The net volume of average earning assets over average interest-bearing liabilities was $17.9 million greater comparing the three months ended December 31, 2018 and 2017.

For the twelve months ended December 31, the tax-equivalent net interest margin was 4.19% in 2018 compared to 3.76% in 2017. The tax-equivalent net interest margin excluding purchase accounting adjustments would have been 3.70% for the twelve months ended December 31, 2018. The tax-equivalent yield on earnings assets was 4.95% and the cost of funds was 0.91% in 2018. The tax-equivalent yield on the loan portfolio increased to 5.27% in 2018 compared to 4.59% in 2017. The tax-equivalent yield on the loan portfolio would have been 4.71% for the twelve months of 2018 excluding loan accretion of $5.2 million included in loan interest income related to acquired loans. For the year ended December 31, investments yielded 2.84% on a tax-equivalent basis in 2018 compared to 3.19% for the same period last year. The cost of interest-bearing deposits increased 21 basis points to 0.84% in 2018 from 0.63% in 2017. The cost of interest-bearing liabilities increased to 0.91% in 2018 from 0.71% in 2017. The growth in average earning assets outpaced that of average interest-bearing liabilities by $74.4 million comparing the twelve months of 2018 and 2017. Loans, net averaged $928.5 million in 2018 and $597.1 million in 2017. Average investments totaled $94.3 million in 2018 and $78.4 million in 2017. Average interest-bearing liabilities increased to $871.7 million in 2018 from $579.5 million in 2017.

For the quarter ended December 31, the Company recognized no provision for loan losses in 2018 compared to $1.0 million for the same period in 2017.  The provision for loan losses totaled $615 thousand for the twelve months ended December 31, 2018, compared to $2,734 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 2018 versus 2017, coupled with continuing solid results and positive trends in asset quality.

For the quarter ended December 31, noninterest income totaled $2,340 thousand in 2018, an increase of $345 thousand from $1,995 thousand in 2017. The increase in noninterest income for the quarter was due primarily to increases in services charges, fees and commissions of $413 thousand and wealth management income of $38 thousand offset by decreases in mortgage banking income. For the twelve months ended December 31, noninterest income increased to $8,880 thousand in 2018 compared to $4,411 thousand in 2017. Service charges and fees, and commissions and trust income improved $3,660 thousand and $571 thousand, respectively, comparing 2018 and 2017. Income from bank owned life insurance increased to $776 thousand in the twelve months of 2018 compared to $449 thousand for the comparable period in 2017.

Noninterest expense decreased $2,549 thousand to $10,640 thousand for the three months ended December 31, 2018, from $13,189 thousand for the same period last year.  The decrease in noninterest expense for the quarter was due primarily to recognizing merger related expenses in the fourth quarter of 2017 of $3,299 thousand.  For the twelve months ended December 31, noninterest expense increased to $38,925 thousand in 2018 compared to $28,560 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 lending teams were primarily responsible for the $882 thousand increase in occupancy and equipment costs. The majority of the $2,409 thousand increase in other expenses comparing 2018 and 2017 was a result of the business combination with CBT.

BALANCE SHEET REVIEW

Total assets, loans, net and deposits totaled $1.1 billion, $893.2 million, and $1.0 billion, respectively, at December 31, 2018. For the three months ended December 31, 2018, total assets, loans, net and deposits decreased $19.1 million, $22.3 million and $16.2 million, respectively. For the year loans, net, decreased $62.8 million comparing the end of the fourth quarter of 2018 to year end 2017. All major categories of loans declined in 2018. Business lending, including commercial and commercial real estate loans decreased $45.8 million while retail lending, including residential mortgages and consumer loans decreased $17.0 million during the twelve months ended December 31, 2018. Loan originations during the year of 2018 represented a more moderate pace as compared to 2017.  The reduction in loan growth was a result of merger related attrition including payoffs on acquired purchase credit impaired loans and management's steadfast adherence to both strong credit quality underwriting standards and pricing discipline.  Total investments were $104.7 million at December 31, 2018, compared to $93.2 million at December 31, 2017. Total deposits decreased $21.9 million in 2018. Noninterest-bearing deposits increased $6.7 million, while interest-bearing deposits decreased $28.6 million. As a percentage of total deposits, noninterest-bearing deposits amounted to 16.2% at December 31, 2018 and 15.2% at December 31, 2017.

Stockholders' equity totaled $113.9 million, or $12.49 per share, at December 31, 2018, $112.0 million, or $12.30 per share, at September 30, 2018, and $106.3 million, or $11.72 per common share, at December 31, 2017. The increase in equity in the twelve months ended December 31, 2018 was a result primarily of net income of $10.9 million offset partially by an increase of $1.0 million in the accumulated other comprehensive loss and dividends declared of $2.7 million. Tangible stockholders' equity per common share increased to $9.39 at December 31, 2018, compared to $9.17 at September 30, 2018 and $8.50 at December 31, 2017.  Dividends declared for the fourth quarter of 2018 amounted to $0.10 per share representing a dividend payout ratio of 37.0%.

ASSET QUALITY REVIEW

Nonperforming assets were $7.2 million, or 0.81% of loans, net and foreclosed assets at December 31, 2018 compared to $8.3 million or 0.91% at September 30, 2018 and $8.2 million, or 0.85% at December 31, 2017. Adjusting for accruing restructured loans, nonperforming assets were $4.3 million, or 0.48% of loans, net and foreclosed assets at December 31, 2018, $3.7 million, or 0.40%, at September 30, 2018 and $2.7 million, or 0.28%, at December 31, 2017. The allowance for loan losses equaled $6.3 million, or 0.71%, of loans, net at December 31, 2018, compared to $6.5 million, or 0.71%, at September 30 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 1.12% as a percentage of loans, net at December 31, 2018. The coverage ratio, allowance for loan losses as a percentage of nonperforming assets, was 88.1% at December 31, 2018. Excluding accruing restructured loans, the coverage ratio would be 148.0% at December 31, 2018. Loans charged-off, net of recoveries, for the three and twelve months ended December 31, 2018, equaled $124 thousand and $573 thousand, compared to $98 thousand and $160 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, businesses and not-for-profit organizations. 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 Nasdaq Global 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 adjusted net income ratios. The reported results for the three and twelve months ended December 31, 2018 and 2017, contain items which Riverview considers non-adjusted, 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)








Dec 31

Sept 30

Jun 30

Mar 31

Dec 31


2018

2018

2018

2018

2017

Key performance data:












Per common share data:






Net income (loss)

$  0.27

$  0.30

$  0.31

$  0.31

$(0.55)

Adjusted net income (1)

$  0.27

$  0.31

$  0.31

$  0.35

$  0.13

Cash dividends declared

$  0.10

$  0.10

$  0.10

$  0.00

$  0.14

Book value

$12.49

$12.30

$12.15

$11.93

$11.72

Tangible book value (1)

$  9.39

$  9.17

$  8.99

$  8.75

$  8.50

Market value:






High

$14.29

$14.40

$12.75

$13.85

$13.65

Low

$10.11

$12.56

$11.85

$12.31

$12.95

Closing

$10.90

$13.60

$12.65

$12.31

$13.15

Market capitalization

$99,425

$123,905

$115,052

$111,827

$119,262

Common shares outstanding

9,121,555

9,110,676

9,094,986

9,084,277

9,069,363







Selected ratios:












Return on average stockholders' equity

8.64%

9.89%

10.17%

10.59%

(17.47)%







Adjusted return on average stockholders' equity (1)

8.78%

10.01%

10.13%

11.88%

4.09%







Return on average tangible stockholders' equity (1)

11.52%

13.29%

13.78%

14.50%

(23.87)%







Adjusted return on average tangible stockholders' equity (1)

11.70%

13.45%

13.73%

16.27%

5.59%







Return on average assets

0.86%

0.96%

0.97%

0.98%

(1.67)%







Adjusted return on average assets (1)

0.87%

0.97%

0.96%

1.10%

0.39%







Stockholders' equity to total assets

10.01%

9.69%

9.59%

9.26%

9.13%







Efficiency ratio (2)

76.11%

69.89%

71.46%

69.28%

100.39%







Nonperforming assets to loans, net, and foreclosed assets

 

0.81%

 

0.91%

 

0.89%

 

0.90%

 

0.85%







Net charge-offs to average loans, net

0.05%

0.07%

0.05%

0.08%

0.04%







Allowance for loan losses to loans, net

0.71%

0.71%

0.68%

0.70%

0.66%







Earning assets yield (FTE) (3)

5.13%

4.93%

4.67%

5.05%

4.67%







Cost of funds

1.02%

0.96%

0.89%

0.80%

0.74%







Net interest spread (FTE) (3)

4.11%

3.97%

3.78%

4.25%

3.93%







Net interest margin (FTE) (3)

4.30%

4.15%

3.94%

4.38%

4.05%













(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)





Twelve Months Ended

Dec 31


Dec 31


2018


2017

Interest income:




Interest and fees on loans:




Taxable

$47,733


$26,474

Tax-exempt

930


600

Interest and dividends on investment securities:




Taxable

2,276


2,155

Tax-exempt

320


228

Dividends



3

Interest on interest-bearing deposits in other banks

575


121

Interest on federal funds sold

20


12

Total interest income

51,854


29,593





Interest expense:




Interest on deposits

7,189


3,489

Interest on short-term borrowings

30


230

Interest on long-term debt

746


401

Total interest expense

7,965


4,120

Net interest income

43,889


25,473

Provision for loan losses

615


2,734

Net interest income after provision for loan losses

43,274


22,739





Noninterest income:




Service charges, fees and commissions

5,697


2,037

Commissions and fees on fiduciary activities

915


344

Wealth management income

811


832

Mortgage banking income

641


660

Life insurance investment income

776


449

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

40


89

Total noninterest income

8,880


4,411





Noninterest expense:




Salaries and employee benefits expense

22,064


15,196

Net occupancy and equipment expense

4,153


3,271

Amortization of intangible assets

868


538

Net cost (benefit) of operation of other real estate owned

48


172

Other expenses

11,792


9,383

Total noninterest expense

38,925


28,560

Income (loss) before income taxes

13,229


(1,410)

Income tax expense (benefit)

2,371


3,501

Net income (loss)

$10,858


$(4,911)

    Other comprehensive income (loss):




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

$(1,012)


$1,471

Reclassification adjustment for (gain) loss included in net income

(40)


(89)

Change in pension liability

(265)


(54)

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

(277)


451

Other comprehensive income (loss), net of income taxes

(1,040)


877

Comprehensive income (loss)

$9,818


$(4,034)





Per common share data:




Net income (loss):




         Basic

$1.19


$(0.91)

         Diluted

$1.19


$(0.91)

Average common shares outstanding:




         Basic

9,096,142


5,260,537

         Diluted

9,148,297


5,260,537

Cash dividends declared

$0.30


$0.55














 

 

Riverview Financial Corporation

Consolidated Statements of Income (Loss)

(In thousands, except per share data)








Three months ended

Dec 31

Sept 30

Jun 30

Mar 31

Dec 31



2018

2018

2018

2018

2017


Interest income:







Interest and fees on loans:







Taxable

$  12,309

$  11,957

$  11,226

$  12,241

$  11,483


Tax-exempt

231

230

235

234

239


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







Taxable

660

551

542

523

548


Tax-exempt

77

80

81

82

88


Dividends







Interest on interest-bearing deposits in other banks

214

181

101

79

43


Interest on federal funds sold



10

10



Total interest income

13,491

12,999

12,195

13,169

12,401









Interest expense:







Interest on deposits

2,027

1,885

1,723

1,554

1,468


Interest on short-term borrowings




30

33


Interest on long-term debt

184

194

192

176

173


Total interest expense

2,211

2,079

1,915

1,760

1,674


Net interest income

11,280

10,920

10,280

11,409

10,727


Provision for loan losses


225


390

1,000


Net interest income after provision for loan losses

11,280

10,695

10,280

11,019

9,727









Noninterest income:







Service charges, fees and commissions

1,551

1,267

1,651

1,228

1,138


Commissions and fees on fiduciary activities

244

226

235

210

252


Wealth management income

239

199

219

154

201


Mortgage banking income

114

168

189

170

226


Life insurance investment income

192

194

199

191

195


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



40


(17)


        Total noninterest income

2,340

2,054

2,533

1,953

1,995









Noninterest expense:







Salaries and employee benefits expense

6,489

5,032

5,221

5,322

6,675


Net occupancy and equipment expense

1,011

1,008

1,012

1,122

1,376


Amortization of intangible assets

212

215

220

221

232


Net cost (benefit) of operation of other real estate owned

18

29

2

(1)

11


Other expenses

2,910

3,057

2,953

2,872

4,895


Total noninterest expense

10,640

9,341

9,408

9,536

13,189


Income (loss) before income taxes

2,980

3,408

3,405

3,436

(1,467)


Income tax expense (benefit)

508

620

618

625

3,457


Net income (loss)

$  2,472

$  2,788

$  2,787

$  2,811

$ (4,924)









Other comprehensive income (loss):







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

$    527

$  (576)

$     112

$(1,075)

$    (237)


Reclassification adjustment for (gain) loss included in net income



(40)


17


Change in pension liability

(265)




(54)


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

54

(121)

15

(225)

(93)


Other comprehensive income (loss), net of income taxes

208

(455)

57

(850)

(181)


Comprehensive income (loss)

$ 2,680

$ 2,333

$ 2,844

$ 1,961

$ (5,105)









Per common share data:







Net income (loss):







         Basic

$ 0.27

$ 0.30

$ 0.31

$ 0.31

$ (0.55)


         Diluted

$ 0.27

$ 0.30

$ 0.31

$ 0.31

$ (0.55)


Average common shares outstanding:







         Basic

9,115,450

9,100,616

9,089,011

9,079,043

8,994,617


         Diluted

9,163,855

9,156,931

9,134,248

9,137,706

8,994,617


Cash dividends declared

$ 0.10

$ 0.10

$ 0.10

$ 0.00

$ 0.14























 

 

Riverview Financial Corporation

Details of Net Interest and Net Interest Margin

(In thousands, fully taxable equivalent basis)







Three months ended

Dec 31

Sept 30

Jun 30

Mar 31

Dec 31


2018

2018

2018

2018

2017

Net interest income:






Interest income






Loans, net:






Taxable

$12,309

$11,957

$11,226

$12,241

$11,483

Tax-exempt

292

291

298

296

362

Total loans, net

12,601

12,248

11,524

12,537

11,845

Investments:






Taxable

660

551

542

523

548

Tax-exempt

97

102

102

104

133

Total investments

757

653

644

627

681

Interest on interest-bearing balances in other banks

214

181

101

79

43

Federal funds sold



10

10


Total interest income

13,572

13,082

12,279

13,253

12,569

Interest expense:






Deposits

2,027

1,885

1,723

1,554

1,468

Short-term borrowings




30

33

Long-term debt

184

194

192

176

173

Total interest expense

2,211

2,079

1,915

1,760

1,674

Net interest income

$11,361

$11,003

$10,364

$11,493

$10,895







Yields on earning assets:






Loans, net:






Taxable

5.60%

5.32%

5.02%

5.46%

4.99%

Tax-exempt

3.26%

3.25%

3.29%

3.23%

3.91%

Total loans, net

5.51%

5.24%

4.95%

5.38%

4.94%

Investments:






Taxable

3.00%

2.82%

2.82%

2.76%

2.65%

Tax-exempt

2.92%

2.83%

2.77%

2.66%

3.04%

Total investments

2.99%

2.82%

2.81%

2.74%

2.71%

Interest-bearing balances with banks

2.08%

2.14%

1.50%

1.36%

0.97%

Federal funds sold



1.56%

1.55%


Total earning assets

5.13%

4.93%

4.67%

5.05%

4.67%

Costs of interest-bearing liabilities:






Deposits

0.95%

0.88%

0.81%

0.72%

0.67%

Short-term borrowings




1.67%

1.39%

Long-term debt

5.95%

5.89%

5.87%

5.41%

5.17%

Total interest-bearing liabilities

1.02%

0.96%

0.89%

0.80%

0.74%

Net interest spread

4.11%

3.97%

3.78%

4.25%

3.93%

Net interest margin

4.30%

4.15%

3.94%

4.38%

4.05%











 

 

Riverview Financial Corporation

Consolidated Balance Sheets

(In thousands, except per share data)








Dec 31

Sept 30

Jun 30

Mar 31

Dec 31

At period end

2018

2018

2018

2018

2017







Assets:






Cash and due from banks

$  16,708

$  13,310

$  13,139

$  14,396

$  9,413

Interest-bearing balances in other banks

37,108

43,505

23,481

40,724

16,373

Federal funds sold




4,729


Investment securities available-for-sale

104,677

97,102

87,908

88,773

93,201

Loans held for sale

637

598

873

610

254

Loans, net

893,184

915,529

939,887

934,190

955,971

Less: allowance for loan losses

6,348

6,472

6,401

6,515

6,306

Net loans

886,836

909,057

933,486

927,675

949,665

Premises and equipment, net

18,208

18,427

18,542

18,714

18,631

Accrued interest receivable

3,010

3,066

2,786

2,865

3,237

Goodwill

24,754

24,754

24,754

24,754

24,754

Other intangible assets, net

3,509

3,721

3,935

4,155

4,376

Other assets

42,156

43,193

42,900

43,771

43,703

Total assets

$1,137,603

$1,156,733

$1,151,804

$1,171,166

$1,163,607













Liabilities:






Deposits:






Noninterest-bearing

$  162,574

$  162,385

$  170,232

$  157,011

$  155,895

Interest-bearing

842,019

858,379

847,490

881,594

870,585

Total deposits

1,004,593

1,020,764

1,017,722

1,038,605

1,026,480

Short-term borrowings





6,000

Long-term debt

6,892

13,019

13,091

13,160

13,233

Accrued interest payable

484

503

449

466

468

Other liabilities

11,724

10,416

10,075

10,535

11,170

Total liabilities

1,023,693

1,044,702

1,041,337

1,062,766

1,057,351







Stockholders' equity:






Preferred stock






Common stock

101,134

100,999

100,790

100,660

100,476

Capital surplus

332

356

424

422

423

Retained earnings

15,063

13,503

11,625

9,747

6,936

Accumulated other comprehensive income (loss)

(2,619)

(2,827)

(2,372)

(2,429)

(1,579)

Total stockholders' equity

113,910

112,031

110,467

108,400

106,256

Total liabilities and stockholders' equity

$1,137,603

$1,156,733

$1,151,804

$1,171,166

$1,163,607


















 

 

Riverview Financial Corporation

Consolidated Balance Sheets

(In thousands except per share data)








Dec 31

Sept 30

Jun 30

Mar 31

Dec 31

Average quarterly balances

2018

2018

2018

2018

2017







Assets:






Loans, net:






Taxable

$872,615

$891,455

$897,085

$908,574

$913,623

Tax-exempt

35,501

35,478

36,374

37,153

36,750

Total loans, net

908,116

926,933

933,459

945,727

950,373

Investments:






Taxable

87,249

77,573

77,061

76,952

82,180

Tax-exempt

13,198

14,288

14,784

15,836

17,345

Total investments

100,447

91,861

91,845

92,788

99,525

Interest-bearing balances with banks

40,787

33,553

27,067

23,607

17,615

Federal funds sold



2,568

2,617

48

Total earning assets

1,049,350

1,052,347

1,054,939

1,064,739

1,067,561

Other assets

95,000

97,377

99,492

98,503

101,120

Total assets

$1,144,350

$1,149,724

$1,154,431

$1,163,242

$1,168,681







Liabilities and stockholders' equity:






Deposits:






Interest-bearing

$847,867

$850,492

$853,986

$875,985

$873,596

Noninterest-bearing

159,758

163,142

166,828

149,123

150,515

Total deposits

1,007,625

1,013,634

1,020,814

1,025,108

1,024,111

Short-term borrowings




7,297

9,403

Long-term debt

12,268

13,060

13,124

13,205

13,271

Other liabilities

10,973

11,208

10,573

9,996

10,053

Total liabilities

1,030,866

1,037,902

1,044,511

1,055,606

1,056,838

Stockholders' equity

113,484

111,822

109,920

107,636

111,843

Total liabilities and stockholders' equity

$1,144,350

$1,149,724

$1,154,431

$1,163,242

$1,168,681

 

 

Riverview Financial Corporation

Asset Quality Data

(In thousands)








Dec 31

Sept 30

Jun 30

Mar 31

Dec 31


2018

2018

2018

2018

2017

At quarter end:






Nonperforming assets:






Nonaccrual loans

$2,729

$2,780

$2,070

$2,629

$1,745

Accruing restructured loans

2,913

4,663

4,693

5,310

5,478

Accruing loans past due 90 days or more

839

225

1,536

393

693

Foreclosed assets

721

668

90

92

236

Total nonperforming assets

$7,202

$8,336

$8,389

$8,424

$8,152







Three months ended:






Allowance for loan losses:






Beginning balance

$6,472

$6,401

$6,515

$6,306

$5,404

Charge-offs

166

189

166

226

142

Recoveries

42

35

52

45

44

Provision for loan losses


225


390

1,000

Ending balance

$6,348

$6,472

$6,401

$6,515

$6,306














 

 

Riverview Financial Corporation

Reconciliation of Non-GAAP Financial Measures

(In thousands, except per share data)








Dec 31

Sept 30

Jun 30

Mar 31

Dec 31

Three months ended:

2018

2018

2018

2018

2017

Adjusted net income (loss) per common share:






Net income (loss)

$2,472

$2,788

$2,787

$2,811

$(4,924)

Dividends on preferred stock






Net income (loss) available to common stockholders

2,472

2,788

2,787

2,811

(4,924)

Undistributed loss (income) allocated to preferred stockholders






Income (loss) allocated to common stockholders

2,472

2,788

2,787

2,811

(4,924)

Adjustments:






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



32


(11)

Add: Acquisition related expenses, net of tax

39

34

22

342

2,177

Add: Tax Cuts and Jobs Act tax expense





3,888

Net income (loss) Adjusted

$2,511

$2,822

$2,777

$3,153

$1,152







Average common shares outstanding

9,115,450

9,100,616

9,089,011

9,079,043

8,994,617

Adjusted net income (loss) per common share

$  0.27

$  0.31

$  0.31

$  0.35

$  0.13







Tangible book value:






Total stockholders' equity

$113,910

$112,031

$110,467

$108,400

$106,256

Less: Goodwill

24,754

24,754

24,754

24,754

24,754

Less: Other intangible assets, net

3,509

3,721

3,935

4,155

4,376

Total tangible stockholders' equity

$85,647

$83,556

$81,778

$79,491

$77,126







Common shares outstanding

9,112,555

9,110,676

9,094,986

9,084,277

9,069,363

Tangible book value per share

$  9.39

$  9.17

$  8.99

$  8.75

$  8.50







Adjusted return on average stockholders' equity:






Net income (loss) GAAP

$2,472

$2,788

$2,787

$2,811

$(4,924)

Adjustments:






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



32


(11)

Add: Acquisition related expenses, net of tax

39

34

22

342

2,177

Add: Tax Cuts and Jobs Act tax expense





3,888

Net income (loss) Adjusted

$2,511

$2,822

$2,777

$3,153

$1,152







Average stockholders' equity

$113,484

$111,822

$109,920

$107,636

$111,843

Adjusted return on average stockholders' equity

8.78%

10.01%

10.13%

11.88%

4.09%







Return on average tangible equity:






Net income (loss) GAAP

$2,472

$2,788

$2,787

$2,811

$(4,924)







Average stockholders' equity

$113,484

$111,822

$109,920

$107,636

$111,843

Less: average intangibles

28,365

28,578

28,800

29,021

30,013

Average tangible stockholders' equity

$85,119

$83,244

$81,120

$78,615

$81,830







Return on average tangible stockholders' equity

11.52%

13.29%

13.78%

14.50%

(23.87)%







Adjusted return on average tangible stockholders' equity:






Net income (loss) GAAP

$2,472

$2,788

$2,787

$2,811

$(4,924)

Adjustments:






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



32


(11)

Add: Acquisition related expenses, net of tax

39

34

22

342

2,177

Add: Tax Cuts and Jobs Act tax expense





3,888

Net income (loss) Adjusted

$2,511

$2,822

$2,777

$3,153

$1,152







Average stockholders' equity

$113,484

$111,822

$109,920

$107,636

$111,843

Less: average intangibles

28,365

28,578

28,800

29,021

30,013

Average tangible stockholders' equity

$85,119

$83,244

$81,120

$78,615

$81,830







Adjusted return on average tangible stockholders' equity

11.70%

13.45%

13.73%

16.27%

5.59%







Adjusted return on average assets:






Net income (loss) GAAP

$2,472

$2,788

$2,787

$2,811

$(4,924)

Adjustments:






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



32


(11)

Add: Acquisition related expenses, net of tax

39

34

22

342

2,177

Add: Tax Cuts and Jobs Act tax expense





3,888

Net income (loss) Adjusted

$2,511

$2,822

$2,777

$3,153

$1,152







Average assets

$1,144,350

$1,149,724

$1,154,431

$1,163,242

$1,168,681

Adjusted return on average assets

0.87%

0.97%

0.96%

1.10%

0.39%










 

 

Riverview Financial Corporation

Reconciliation of Non-GAAP Financial Measures

(In thousands, except per share data)







Dec 31

Dec 31



2018

2017

Twelve months ended:








Adjusted net income per common share:




Net income (loss)


$10,858

$(4,911)

Dividends on preferred stock



(371)

Net income available to common stockholders


10,858

(5,282)

Undistributed loss allocated to preferred stockholders



475

Income allocated to common stockholders


10,858

(4,807)

Adjustments:




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


32

58

   Add: Acquisition related expenses, net of tax


437

2,425

   Add: Tax Cuts and Jobs Act of 2017 tax expense



3,888

Net income (loss) Adjusted


$11,263

$1,448





Average common shares outstanding


9,096,142

5,260,537





Adjusted net income (loss) per common share


$1.24

$0.28





 

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SOURCE Riverview Financial Corporation