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8-K - FORM 8-K - Riverview Financial Corpd566209d8k.htm

Exhibit 99.1

NEWS RELEASE

RIVERVIEW FINANCIAL CORPORATION

REPORTS FIRST QUARTER 2018 FINANCIAL RESULTS

HARRISBURG, PA, April 12, 2018 / PRNEWSWIRE/ Riverview Financial Corporation (“Riverview”) (OTCQX: RIVE), today reported unaudited financial results at and for the three months ended March 31, 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 first quarter of 2018, compared to a net loss of $567 thousand, or $(0.12) per basic and diluted weighted average common share, for the comparable period of 2017. The results for the first quarter ended March 31, 2018 include pre-tax merger related costs of $433 thousand. The earnings increase was primarily a result of the inclusion of the results of operations of both Riverview and CBT for the quarter ended March 31, 2018, compared to Riverview on a standalone basis for the same period last year. The quarter over quarter improvement was also a function of the recognition of higher loan interest income from achieving over 40% 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

 

    Annualized return on average assets and return on average tangible stockholders’ equity were 0.98% and 14.50%, respectively, for the first quarter 2018.

 

    Core net income totaled $3.2 million, or $0.35 per share, in the first quarter 2018.

 

    Tax-equivalent net interest margin improved to 4.38% in the first quarter of 2018 compared to 3.57% for the same period last year.

 

    Noninterest income totaled $2.0 million at March 31, 2018 compared to $779 thousand for the same period last year, an increase of 150.7%.

 

    Income from trust and wealth management services totaled $364 thousand at March 31, 2018 compared to $288 thousand for the same period last year, an increase of 26.4%.

 

    Deposits increased $12.2 million in the first quarter 2018, or 4.8% annualized.

 

    Asset quality improved as nonperforming assets as a percentage of loans, net and other real estate owned declined to 0.90% at March 31, 2018 compared to 1.74% at March 31, 2017.


    Tangible book value per share improved to $8.75 at March 31, 2018 from $8.50 at December 31, 2017.

 

    The effective tax rate decreased to 18.1% in the first quarter of 2018 as a result of the recently enacted tax reform legislation.

“We are pleased to report record earnings for the first quarter of 2018 as a result of successfully implementing our strategic initiatives, which have established the foundation for the future performance of our company. The integration of CBT Bank into Riverview has met expectations to date and favorably impacted our operating results, along with the significant organic loan growth achieved over the past year. We look forward to achieving operating efficiencies through the conversion of our core processing system in the second quarter of 2018 along with the benefits derived for our customers by being able to offer enhanced and new products and services,” said Kirk D. Fox, Chief Executive Officer. “However, the progress achieved from the acquisition of CBT did not come without recognizing significant merger related costs. These costs, along with recording a charge to income tax expense of $3.9 million related to the re-measurement of net deferred tax assets from the enactment of new tax legislation in December 2017, caused executive management to suspend the payment of a first quarter dividend in order to conserve capital given the magnitude of these one-time expenses. The suspension of the dividend in the first quarter 2018 does not preclude the declaration and payment of dividends in the future. It is our goal to return to a reasonable dividend payment, determined by quarterly earnings throughout 2018, 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.”

Brett D. Fulk, President, added, “We are excited to report our 2018 first quarter results, providing tangible evidence of the earnings power of our institution following a transformative 2017. We must give recognition where recognition is due: these results are the direct result of an invaluable team of hard working and highly dedicated employees at Riverview Bank and its operating divisions, without whom these results would most assuredly not be possible. Our most valuable ‘assets’ are the people working for Riverview who have worked tirelessly to provide a smooth and seamless integration of CBT Bank with and into Riverview, while keeping a clear focus on execution and customer service at the same time. We are very pleased with the status of the integration of our 2017 merger of equals business combination to date, which once again is a clear testimony to the quality of employees we are blessed to have working on our team.” Fulk continued, “we will remain focused internally for as long as necessary to ensure ongoing success with the remaining components required to complete the combination of our CBT Bank division into Riverview. Equally important is our need to maintain appropriate credit underwriting standards, active management of our credit portfolio, and pricing discipline in the face of what continues to be a challenging rate environment and ongoing competitive pressures throughout our expanded market territory.”

INCOME STATEMENT REVIEW

Tax-equivalent net interest income for the three months ended March 31, increased $7.0 million to $11.5 million in 2018 from $4.5 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. The tax-equivalent net interest margin for the three months ended March 31, 2018, increased to 4.38% from 3.57% for the comparable period of 2017. The tax-equivalent yield on earnings assets was


5.05% and the cost of funds was 0.80% in the first quarter of 2018. The tax-equivalent yield on the loan portfolio increased to 5.38% in 2018 compared to 4.30% in 2017. Loan accretion included in loan interest income in the first quarter of 2018 related to loans acquired in the fourth quarter of 2017 was $1.8 million, resulting in an increase in the tax-equivalent net interest margin of 69 basis points. The tax-equivalent net interest margin excluding the loan accretion would have been 3.69% in the first three months of 2018. Investments yielded 2.74% on a tax-equivalent basis in the first quarter of 2018 compared to 3.45% for the same period last year. The cost of deposits increased 18 basis points to 0.72% in 2018 from 0.54% in 2017. The growth in average earning assets outpaced that of average interest-bearing liabilities by $83.0 million comparing the first quarters of 2018 and 2017. Loans, net averaged $945.7 million in 2018 and $420.1 million in 2017. Average investments totaled $92.8 million in 2018 and $75.0 million in 2017. Average interest-bearing liabilities increased to $896.5 million in 2018 from $423.8 million in 2017.

The provision for loan losses totaled $390 thousand for the quarter ended March 31, 2018, compared to $605 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 three months of 2018 versus 2017, coupled with continuing solid results and positive trends in asset quality.

For the quarter ended March 31, noninterest income totaled $1,953 thousand in 2018, an increase of $1,174 thousand from $779 thousand in 2017. All major categories of noninterest income improved as a result of the merger with the exception of the retail wealth management component of our wealth management division. Retail wealth management income, excluding Trust, decreased $104 thousand comparing the first quarters of 2018 and 2017 due to the dissolution of a business acquired in 2016. Service charges and fees, and commissions and trust income improved $891 thousand and $180 thousand, respectively, comparing the first quarters of 2018 and 2017. Mortgage banking income in 2018 improved to $170 thousand compared to $82 thousand in 2017. Income from bank owned life insurance increased to $191 thousand in the first quarter of 2018 compared to $73 thousand for the comparable quarter of 2017.

Noninterest expense increased $4,373 thousand, or 84.7%, to $9,536 thousand for the three months ended March 31, 2018, from $5,163 thousand for the same period last year. 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 $476 thousand, or 73.6%, increase in occupancy and equipment costs. The majority of the $1,391 thousand increase in other expenses comparing the first quarters 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, $934.2 million, and $1.0 billion, respectively, at March 31, 2018. Loans, net decreased $21.8 million comparing the end of the first quarter of 2018 to year end 2017 with commercial real estate loans being responsible for the majority of the decline. Total investments were $88.8 million at March 31, 2018, compared to $93.2 million at December 31, 2017. Total deposits increased $12.2 million, or 4.8% annualized, in the first three months of 2018. Noninterest-bearing deposits increased $1.1 million, while interest-bearing deposits increased $11.0 million. An improvement in the volume of NOW accounts was primarily responsible for the increase in interest-bearing deposits.


Stockholders’ equity totaled $108.4 million, or $11.93 per common 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 quarter of 2018 was a result primarily of net income of $2.8 million offset partially by an increase of $850 thousand in the accumulated other comprehensive loss. Tangible stockholders’ equity per common share increased to $8.75 per share at March 31, 2018, compared to $8.50 per share at year-end 2017. On March 14, 2018 the Board of Directors of Riverview announced the suspension of the payment of its first quarter 2018 dividend in order to conserve capital as a result of recognizing certain material nonrecurring fourth quarter expenses in 2017.

ASSET QUALITY REVIEW

Nonperforming assets were $8.4 million, or 0.90% of loans, net and foreclosed assets at March 31, 2018, a slight increase from $8.2 million, or 0.85%, at December 31, 2017. This asset quality ratio remains significantly improved from 1.74%, at March 31, 2017. Adjusting for accruing restructured loans, nonperforming assets were $3.1 million, or 0.3% of loans, net and foreclosed assets at March 31, 2018, $2.7 million, or 0.3%, at December 31, 2017, and $2.5 million, or 0.5%, at March 31, 2017. The allowance for loan losses equaled $6.5 million, or 0.70% of loans, net at March 31, 2018, compared to $6.3 million, or 0.66% of loans, net at December 31, 2017, and $4.3 million, or 0.93% of loans, net, at March 31, 2017. Adding purchase accounting adjustments for credit deterioration on acquired loans to the allowance for loan losses would result in a ratio of 1.96% as a percentage of loans, net at March 31, 2018. The coverage ratio, allowance for loan losses as a percentage of nonperforming assets was 77.3% at March 31, 2018. Excluding accruing restructured loans, the coverage ratio would be 209.2% at March 31, 2018. Loans charged-off, net of recoveries, for the three months ended March 31, 2018, equaled $181 thousand or 0.08% of average loans, compared to $8 thousand or 0.01% of average loans for the same period last year.

Riverview Financial Corporation is the parent company of Riverview Bank and its operating divisions Halifax Bank, Marysville Bank, 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/ .

SOURCE: Riverview Financial Corporation

Contact: Scott A. Seasock, CFO at 717.827.4039 or sseasock@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 pre-acquisition 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 months ended March 31, 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)

 

     Mar 31      Dec 31     Sept 30      Jun 30      Mar 31  
     2018      2017     2017      2017      2017  

Key performance data:

             

Per common share data:

             

Net income (loss)

   $ 0.31      $ (0.55   $ 0.09      $ 0.04      $ (0.12

Core net income (loss) (1)

   $ 0.35      $ 0.13     $ 0.09      $ 0.05      $ (0.10

Cash dividends declared

   $ 0.00      $ 0.14     $ 0.14      $ 0.14      $ 0.14  

Book value

   $ 11.93      $ 11.72     $ 11.73      $ 11.79      $ 12.45  

Tangible book value (1)

   $ 8.75      $ 8.50     $ 10.47      $ 10.51      $ 10.65  

Market value:

             

High

   $ 13.85      $ 13.65     $ 13.50      $ 14.65      $ 12.20  

Low

   $ 12.31      $ 12.95     $ 12.15      $ 11.81      $ 11.46  

Closing

   $ 12.31      $ 13.15     $ 13.20      $ 13.48      $ 11.95  

Market capitalization

   $ 111,827      $ 119,262     $ 64,576      $ 65,739      $ 42,044  

Common shares outstanding

     9,084,277        9,069,363       4,892,143        4,876,774        3,518,351  

Selected ratios:

             

Return on average stockholders’ equity

     10.59%        (17.47)%       2.77%        1.25%        (4.20)%  

Core return on average stockholders’ equity (1)

     11.88%        4.09%       3.06%        1.73%        (3.70)%  

Return on average tangible stockholders’ equity (1)

     14.50%        (23.87)%       3.10%        1.41%        (4.79)%  

Core return on average tangible stockholders’ equity (1)

     16.27%        5.59%       3.43%        1.95%        (4.22)%  

Return on average assets

     0.98%        (1.67)%       0.24%        0.12%        (0.41)%  

Core return on average assets (1)

     1.10%        0.39%       0.26%        0.16%        (0.36)%  

Stockholders’ equity to total assets

     9.26%        9.13%       8.42%        9.15%        9.51%  

Efficiency ratio (2)

     69.28%        100.39%       80.85%        86.53%        94.91%  

Nonperforming assets to loans, net, and foreclosed assets

     0.90%        0.85%       1.26%        1.41%        1.74%  

Net charge-offs to average loans, net

     0.08%        0.04%       0.03%        0.01%        0.01%  

Allowance for loan losses to loans, net

     0.70%        0.66%       0.96%        0.96%        0.93%  

Earning assets yield (FTE) (3)

     5.05%        4.67%       4.22%        4.16%        4.08%  

Cost of funds

     0.80%        0.74%       0.76%        0.69%        0.60%  

Net interest spread (FTE) (3)

     4.25%        3.93%       3.46%        3.47%        3.48%  

Net interest margin (FTE) (3)

     4.38%        4.05%       3.57%        3.58%        3.57%  

 

(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)

 

     Mar 31     Mar 31  

Three Months Ended

   2018     2017  

Interest income:

    

Interest and fees on loans:

    

Taxable

   $ 12,241     $ 4,285  

Tax-exempt

     234       108  

Interest and dividends on investment securities:

    

Taxable

     523       564  

Tax-exempt

     82       47  

Dividends

       3  

Interest on interest-bearing deposits in other banks

     79       23  

Interest on federal funds sold

     10       6  

Total interest income

     13,169       5,036  

Interest expense:

    

Interest on deposits

     1,554       532  

Interest on short-term borrowings

     30       22  

Interest on long-term debt

     176       75  

Total interest expense

     1,760       629  

Net interest income

     11,409       4,407  

Provision for loan losses

     390       605  

Net interest income after provision for loan losses

     11,019       3,802  

Noninterest income:

    

Service charges, fees and commissions

     1,228       337  

Commissions and fees on fiduciary activities

     210       30  

Wealth management income

     154       258  

Mortgage banking income

     170       82  

Life insurance investment income

     191       73  

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

       (1

Total noninterest income

     1,953       779  

Noninterest expense:

    

Salaries and employee benefits expense

     5,322       2,836  

Net occupancy and equipment expense

     1,122       646  

Amortization of intangible assets

     221       164  

Net cost of operation of other real estate owned

     (1     36  

Other expenses

     2,872       1,481  

Total noninterest expense

     9,536       5,163  

Income (loss) before income taxes

     3,436       (582

Provision for income tax expense (benefit)

     625       (15

Net income (loss)

     2,811       (567

Other comprehensive income (loss):

    

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

   $ (1,075   $ 512  

Reclassification adjustment for (gain) loss included in net income

       1  

Change in pension liability

    

Income tax expense (benefit) related to other comprehensive income

     (225     174  

Other comprehensive income (loss), net of income taxes

     (850     339  

Comprehensive income (loss)

   $ 1,961     $ (228

Per common share data:

    

Net income (loss):

    

Basic

   $ 0.31     $ (0.12

Diluted

   $ 0.31     $ (0.12

Average common shares outstanding:

    

Basic

     9,079,043       3,454,704  

Diluted

     9,137,706       3,454,704  

Cash dividends declared

   $ 0.00     $ 0.14  


Riverview Financial Corporation

Consolidated Statements of Income (Loss)

(In thousands, except per share data)

 

     Mar 31     Dec 31     Sept 30     Jun 30     Mar 31  

Three months ended

   2018     2017     2017     2017     2017  

Interest income:

          

Interest and fees on loans:

          

Taxable

   $ 12,241     $ 11,483     $ 5,717     $ 4,989     $ 4,285  

Tax-exempt

     234       239       146       107       108  

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

          

Taxable

     523       548       477       566       564  

Tax-exempt

     82       88       47       46       47  

Dividends

             3  

Interest on interest-bearing deposits in other banks

     79       43       31       24       23  

Interest on federal funds sold

     10         2       4       6  

Total interest income

     13,169       12,401       6,420       5,736       5,036  

Interest expense:

          

Interest on deposits

     1,554       1,468       821       668       532  

Interest on short-term borrowings

     30       33       112       63       22  

Interest on long-term debt

     176       173       75       78       75  

Total interest expense

     1,760       1,674       1,008       809       629  

Net interest income

     11,409       10,727       5,412       4,927       4,407  

Provision for loan losses

     390       1,000       610       519       605  

Net interest income after provision for loan losses

     11,019       9,727       4,802       4,408       3,802  

Noninterest income:

          

Service charges, fees and commissions

     1,228       1,138       270       292       337  

Commissions and fees on fiduciary activities

     210       252       31       31       30  

Wealth management income

     154       201       179       194       258  

Mortgage banking income

     170       226       205       147       82  

Life insurance investment income

     191       195       107       74       73  

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

       (17     43       64       (1

Total noninterest income

     1,953       1,995       835       802       779  

Noninterest expense:

          

Salaries and employee benefits expense

     5,322       6,675       2,928       2,757       2,836  

Net occupancy and equipment expense

     1,122       1,376       615       634       646  

Amortization of intangible assets

     221       232       71       71       164  

Net cost of operation of other real estate owned

     (1     11       (13     138       36  

Other expenses

     2,872       4,895       1,566       1,441       1,481  

Total noninterest expense

     9,536       13,189       5,167       5,041       5,163  

Income (loss) before income taxes

     3,436       (1,467     470       169       (582

Income tax expense (benefit)

     625       3,457       69       (10     (15

Net income (loss)

   $ 2,811     $ (4,924   $ 401     $ 179     $ (567

Other comprehensive income (loss):

          

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

   $ (1,075   $ (237   $ (50   $ 1,246     $ 512  

Reclassification adjustment for (gain) loss included in net income

       17       (43     (64     1  

Change in pension liability

       (54      

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

     (225     (93     (32     402       174  

Other comprehensive income (loss), net of income taxes

     (850     (181     (61     780       339  

Comprehensive income (loss)

   $ 1,961     $ (5,105   $ 340     $ 959     $ (228

Per common share data:

          

Net income (loss):

          

Basic

   $ 0.31     $ (0.55   $ 0.09     $ 0.04     $ (0.12

Diluted

   $ 0.31     $ (0.55   $ 0.09     $ 0.04     $ (0.12

Average common shares outstanding:

          

Basic

     9,079,043       8,994,617       4,880,676       3,655,446       3,454,704  

Diluted

     9,137,706       8,994,617       4,945,456       3,726,939       3,454,704  

Cash dividends declared

   $ 0.00     $ 0.14     $ 0.14     $ 0.14     $ 0.14  


Riverview Financial Corporation

Details of Net Interest and Net Interest Margin

(In thousands, fully taxable equivalent basis)

 

     Mar 31      Dec 31      Sept 30      Jun 30      Mar 31  

Three months ended

   2018      2017      2017      2017      2017  

Net interest income:

              

Interest income

              

Loans, net:

              

Taxable

   $ 12,241      $ 11,483      $ 5,717      $ 4,989      $ 4,285  

Tax-exempt

     296        362        221        162        164  

Total loans, net

     12,537        11,845        5,938        5,151        4,449  

Investments:

              

Taxable

     523        548        477        566        567  

Tax-exempt

     104        133        71        70        71  

Total investments

     627        681        548        636        638  

Interest on interest-bearing balances in other banks

     79        43        31        24        23  

Federal funds sold

     10           2        4        6  

Total interest income

     13,253        12,569        6,519        5,815        5,116  

Interest expense:

              

Deposits

     1,554        1,468        821        668        532  

Short-term borrowings

     30        33        112        63        22  

Long-term debt

     176        173        75        78        75  

Total interest expense

     1,760        1,674        1,008        809        629  

Net interest income

   $ 11,493      $ 10,895      $ 5,511      $ 5,006      $ 4,487  

Yields on earning assets:

              

Loans, net:

              

Taxable

     5.46%        4.99%        4.40%        4.36%        4.30%  

Tax-exempt

     3.23%        3.91%        3.94%        3.99%        4.06%  

Total loans, net

     5.38%        4.94%        4.38%        4.35%        4.30%  

Investments:

              

Taxable

     2.76%        2.65%        3.17%        3.35%        3.32%  

Tax-exempt

     2.66%        3.04%        4.90%        4.89%        5.01%  

Total investments

     2.74%        2.71%        3.33%        3.47%        3.45%  

Interest-bearing balances with banks

     1.36%        0.97%        1.35%        0.95%        0.87%  

Federal funds sold

     1.55%           1.71%        0.94%        0.74%  

Total earning assets

     5.05%        4.67%        4.22%        4.16%        4.08%  

Costs of interest-bearing liabilities:

              

Deposits

     0.72%        0.67%        0.67%        0.62%        0.54%  

Short-term borrowings

     1.67%        1.39%        1.32%        1.11%        0.86%  

Long-term debt

     5.41%        5.17%        4.16%        2.81%        2.73%  

Total interest-bearing liabilities

     0.80%        0.74%        0.76%        0.69%        0.60%  

Net interest spread

     4.25%        3.93%        3.46%        3.47%        3.48%  

Net interest margin

     4.38%        4.05%        3.57%        3.58%        3.57%  


Riverview Financial Corporation

Consolidated Balance Sheets

(In thousands, except per share data)

 

     Mar 31     Dec 31     Sept 30     Jun 30     Mar 31  

At period end

   2018     2017     2017     2017     2017  

Assets:

          

Cash and due from banks

   $ 14,396     $ 9,413     $ 8,425     $ 9,613     $ 10,852  

Interest-bearing balances in other banks

     40,724       16,373       10,741       6,064       11,552  

Federal funds sold

     4,729          

Investment securities available-for-sale

     88,773       93,201       56,874       67,852       72,741  

Loans held for sale

     610       254       519       1,037       522  

Loans, net

     934,190       955,971       560,187       504,749       464,481  

Less: allowance for loan losses

     6,515       6,306       5,404       4,834       4,329  

Net loans

     927,675       949,665       554,783       499,915       460,152  

Premises and equipment, net

     18,714       18,631       12,163       12,132       12,116  

Accrued interest receivable

     2,865       3,237       1,995       1,651       1,881  

Goodwill

     24,754       24,754       5,079       5,079       5,079  

Other intangible assets, net

     4,155       4,376       1,099       1,170       1,241  

Other assets

     43,771       43,703       29,701       23,728       24,237  

Total assets

   $ 1,171,166     $ 1,163,607     $ 681,379     $ 628,241     $ 600,373  

Liabilities:

          

Deposits:

          

Noninterest-bearing

   $ 157,011     $ 155,895     $ 76,214     $ 76,096     $ 79,127  

Interest-bearing

     881,594       870,585       498,736       447,799       417,380  

Total deposits

     1,038,605       1,026,480       574,950       523,895       496,507  

Short-term borrowings

       6,000       37,250       30,000       30,000  

Long-term debt

     13,160       13,233       6,503       11,589       11,073  

Accrued interest payable

     466       468       213       194       203  

Other liabilities

     10,535       11,170       5,084       5,048       5,499  

Total liabilities

     1,062,766       1,057,351       624,000       570,726       543,282  

Stockholders’ equity:

          

Preferred stock

             13,283  

Common stock

     100,660       100,476       45,427       45,240       31,833  

Capital surplus

     422       423       243       235       224  

Retained earnings

     9,747       6,936       12,848       13,118       13,609  

Accumulated other comprehensive income (loss)

     (2,429     (1,579     (1,139     (1,078     (1,858

Total stockholders’ equity

     108,400       106,256       57,379       57,515       57,091  

Total liabilities and stockholders’ equity

   $ 1,171,166     $ 1,163,607     $ 681,379     $ 628,241     $ 600,373  


Riverview Financial Corporation

Consolidated Balance Sheets

(In thousands except per share data)

 

     Mar 31      Dec 31      Sept 30      Jun 30      Mar 31  

Average quarterly balances

   2018      2017      2017      2017      2017  

Assets:

              

Loans, net:

              

Taxable

   $ 908,574      $ 913,623      $ 515,494      $ 458,702      $ 403,684  

Tax-exempt

     37,153        36,750        22,246        16,285        16,396  

Total loans, net

     945,727        950,373        537,740        474,987        420,080  

Investments:

              

Taxable

     76,952        82,180        59,612        67,753        69,253  

Tax-exempt

     15,836        17,345        5,746        5,747        5,748  

Total investments

     92,788        99,525        65,358        73,500        75,001  

Interest-bearing balances with banks

     23,607        17,615        9,143        10,137        10,662  

Federal funds sold

     2,617        48        465        1,709        3,293  

Total earning assets

     1,064,739        1,067,561        612,706        560,333        509,036  

Other assets

     98,503        101,120        52,770        49,382        49,025  

Total assets

   $ 1,163,242      $ 1,168,681      $ 665,476      $ 609,715      $ 558,061  

Liabilities and stockholders’ equity:

              

Deposits:

              

Interest-bearing

   $ 875,985      $ 873,596      $ 483,648      $ 435,033      $ 402,339  

Noninterest-bearing

     149,123        150,515        77,819        77,440        73,188  

Total deposits

     1,025,108        1,024,111        561,467        512,473        475,527  

Short-term borrowings

     7,297        9,403        33,707        22,838        10,324  

Long-term debt

     13,205        13,271        7,151        11,146        11,122  

Other liabilities

     9,996        10,053        5,700        5,909        6,325  

Total liabilities

     1,055,606        1,056,838        608,025        552,366        503,298  

Stockholders’ equity

     107,636        111,843        57,451        57,349        54,763  

Total liabilities and stockholders’ equity

   $ 1,163,242      $ 1,168,681      $ 665,476      $ 609,715      $ 558,061  


Riverview Financial Corporation

Asset Quality Data

(In thousands)

 

     Mar 31      Dec 31      Sept 30      Jun 30      Mar 31  
     2018      2017      2017      2017      2017  

At quarter end:

              

Nonperforming assets:

              

Nonaccrual loans

   $ 2,629      $ 1,745      $ 1,765      $ 1,702      $ 1,725  

Accruing restructured loans

     5,310        5,478        5,168        5,199        5,597  

Accruing loans past due 90 days or more

     393        693           35        189  

Foreclosed assets

     92        236        144        205        561  

Total nonperforming assets

   $ 8,424      $ 8,152      $ 7,077      $ 7,141      $ 8,072  

Three months ended:

              

Allowance for loan losses:

              

Beginning balance

   $ 6,306      $ 5,404      $ 4,834      $ 4,329      $ 3,732  

Charge-offs

     226        142        42        21        12  

Recoveries

     45        44        2        7        4  

Provision for loan losses

     390        1,000        610        519        605  

Ending balance

   $ 6,515      $ 6,306      $ 5,404      $ 4,834      $ 4,329  


Riverview Financial Corporation

Reconciliation of Non-GAAP Financial Measures

(In thousands, except per share data)

 

     Mar 31      Dec 31     Sept 30      Jun 30     Mar 31  

Three months ended:

   2018      2017     2017      2017     2017  

Core net income (loss) per common share:

            

Net income (loss)

   $ 2,811      $ (4,924   $ 401      $ 179     $ (567

Dividends on preferred stock

             (186     (185

Net income (loss) available to common stockholders

     2,811        (4,924     401        (7     (752

Undistributed loss (income) allocated to preferred stockholders

             128       347  

Income (loss) allocated to common stockholders

     2,811        (4,924     401        121       (405

Adjustments:

            

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

        (11     28        42       (1

Add: Acquisition related expenses, net of tax

     342        2,177       70        111       67  

Add: Tax Cuts and Jobs Act tax expense

        3,888         

Net income (loss) Core

   $ 3,153      $ 1,152     $ 443      $ 190     $ (337

Average common shares outstanding

     9,079,043        8,994,617       4,880,676        3,655,446       3,454,704  

Core net income (loss) per common share

   $ 0.35      $ 0.13     $ 0.09      $ 0.05     $ (0.10

Tangible book value:

            

Total stockholders’ equity

   $ 108,400      $ 106,256     $ 57,379      $ 57,515     $ 43,808  

Less: Goodwill

     24,754        24,754       5,079        5,079       5,079  

Less: Other intangible assets, net

     4,155        4,376       1,099        1,170       1,241  

Total tangible stockholders’ equity

   $ 79,491      $ 77,126     $ 51,201      $ 51,266     $ 37,488  

Common shares outstanding

     9,084,277        9,069,363       4,892,143        4,876,774       3,518,351  

Tangible book value per share

   $ 8.75      $ 8.50     $ 10.47      $ 10.51     $ 10.65  

Core return on average stockholders’ equity:

            

Net income (loss) GAAP

   $ 2,811      $ (4,924   $ 401      $ 179     $ (567

Adjustments:

            

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

        (11     28        42       (1

Add: Acquisition related expenses, net of tax

     342        2,177       70        111       67  

Add: Tax Cuts and Jobs Act tax expense

        3,888         

Net income (loss) Core

   $ 3,153      $ 1,152     $ 443      $ 248     $ (499

Average stockholders’ equity

   $ 107,636      $ 111,843     $ 57,451      $ 57,349     $ 54,763  

Core return on average stockholders’ equity

     11.88%        4.09%       3.06%        1.73%       (3.70)%  

Return on average tangible equity:

            

Net income (loss) GAAP

   $ 2,811      $ (4,924   $ 401      $ 179     $ (567

Average stockholders’ equity

   $ 107,636      $ 111,843     $ 57,451      $ 57,349     $ 54,763  

Less: average intangibles

     29,021        30,013       6,213        6,284       6,765  

Average tangible stockholders’ equity

   $ 78,615      $ 81,830     $ 51,238      $ 51,065     $ 47,998  

Return on average tangible stockholders’ equity

     14.50%        (23.87)%       3.10%        1.41%       (4.79)%  

Core return on average tangible stockholders’ equity:

            

Net income (loss) GAAP

   $ 2,811      $ (4,924   $ 401      $ 179     $ (567

Adjustments:

            

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

        (11     28        42       (1

Add: Acquisition related expenses, net of tax

     342        2,177       70        111       67  

Add: Tax Cuts and Jobs Act tax expense

        3,888         

Net income (loss) Core

   $ 3,153      $ 1,152     $ 443      $ 248     $ (499

Average stockholders’ equity

   $ 107,636      $ 111,843     $ 57,451      $ 57,349     $ 54,763  

Less: average intangibles

     29,021        30,013       6,213        6,284       6,765  

Average tangible stockholders’ equity

   $ 78,615      $ 81,830     $ 51,238      $ 51,065     $ 47,998  

Core return on average tangible stockholders’ equity

     16.27%        5.59%       3.43%        1.95%       (4.22)%  

Core return on average assets:

            

Net income (loss) GAAP

   $ 2,811      $ (4,924   $ 401      $ 179     $ (567

Adjustments:

            

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

        (11     28        42       (1

Add: Acquisition related expenses, net of tax

     342        2,177       70        111       67  

Add: Tax Cuts and Jobs Act tax expense

        3,888         

Net income (loss) Core

   $ 3,153      $ 1,152     $ 443      $ 248     $ (499

Average assets

   $ 1,163,242      $ 1,168,681     $ 665,476      $ 609,715     $ 558,061  

Core return on average assets

     1.10%        0.39%       0.26%        0.16%       (0.36)%  


Riverview Financial Corporation

Reconciliation of Non-GAAP Financial Measures

(In thousands, except per share data)

 

     Mar 31      Mar 31  

Three months ended:

   2018      2017  

Core net income per common share:

     

Net income (loss)

   $ 2,811      $ (567

Dividends on preferred stock

        (185

Net income available to common stockholders

     2,811        (752

Undistributed loss allocated to preferred stockholders

        347  

Income allocated to common stockholders

     2,811        (405

Adjustments:

     

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

        (1

Add: Acquisition related expenses, net of tax

     342        67  

Add: Tax Cuts and Jobs Act of 2017 tax expense

     

Net income (loss) core

   $ 3,153      $ (337

Average common shares outstanding

     9,079,043        3,454,704  

Core net income (loss) per common share

   $ 0.35      $ (0.10