8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

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

Date of Report (Date of earliest event reported): January 23, 2020

RIVERVIEW BANCORP, INC.

(Exact name of registrant as specified in its charter)

Washington	000-22957	91-1838969
(State or other jurisdiction<br><br> <br>of incorporation)	(Commission<br><br> <br>File Number)	(I.R.S. Employer<br><br> <br>Identification No.)
900 Washington Street, Suite 900, Vancouver, Washington	98660
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(Address of principal executive offices)	(Zip Code)

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

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

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, Par Value $0.01 per share	RVSB	The NASDAQ Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company [ ]

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]

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Item 2.02 Results of Operations and Financial Condition.

On January 23, 2020, Riverview Bancorp, Inc. issued its earnings release for the quarter ended December 31, 2019.  A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

Item 9.01  Financial Statements and Exhibits.

(d) Exhibits

The following exhibit is being furnished herewith and this list shall constitute the exhibit index:

99.1 News Release of Riverview Bancorp, Inc. dated January 23, 2020.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	RIVERVIEW BANCORP, INC.
Date:  January 23, 2020	/S/ David Lam
	David Lam<br><br> <br>Chief Financial Officer<br><br> <br>(Principal Financial Officer)

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Exhibit 99.1

Contact:	Kevin Lycklama or David Lam<br><br> <br>Riverview Bancorp, Inc. 360-693-6650

Riverview Bancorp Reports Earnings of $4.1 Million in Third Quarter of Fiscal Year 2020,

Highlighted by Strong Deposit Growth and Excellent Asset Quality

Vancouver, WA – January 23, 2020 - Riverview Bancorp, Inc. (Nasdaq GSM: RVSB) (“Riverview” or the “Company”) today reported earnings of $4.1 million, or $0.18 per diluted share for the third fiscal quarter ended December 31, 2019, compared to $4.5 million, or $0.20 per diluted share, in the preceding quarter, and $4.4 million, or $0.19 per diluted share, in the third fiscal quarter a year ago. For the first nine months of fiscal 2020, earnings were $12.9 million, or $0.57 per diluted share, compared to $13.1 million, or $0.58 per diluted share, in the first nine months of fiscal 2019.

“We continue to build our momentum, delivering strong financial results for the quarter,” said Kevin Lycklama, president and chief executive officer. “Our reputation for excellent customer service, established by our team of dedicated bankers, continues to drive growth and our ability to attract new clients. We recently announced plans for three new locations in Clark County, Washington, which will be a terrific complement to our existing branch network. In addition to the fall opening of our new location in Ridgefield, we have two new branches  opening this summer in downtown Camas and in the Cascade Park neighborhood of Vancouver.

Third Quarter Highlights (at or for the period ended December 31, 2019)

•	Net income was $4.1 million, or $0.18 per diluted share.
•	Net interest margin (NIM) remained healthy at 4.23% for the quarter.
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•	Return on average assets was 1.40% and return on average equity was 11.24% for the third quarter.
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•	Total deposits increased $8.2 million during the quarter to $990.5 million.
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•	Total loans increased $5.2 million during the quarter to $886.5 million.
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•	Asset quality remains strong, with non-performing assets at 0.13% of total assets.
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•	Total risk-based capital ratio was 17.66% and Tier 1 leverage ratio was 12.05%.
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•	Increased its quarterly cash dividend to $0.05 per share, generating a current dividend yield of 2.66% based on the share price at close of market on January 14, 2020.
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Income Statement

“We continue to strengthen our franchise, while remaining focused on containing operating expenses and maintaining high credit quality standards,” said Lycklama. Riverview’s return on average assets remained strong at 1.40% in the third quarter of fiscal year 2020 compared to 1.53% in the third quarter of fiscal 2019. Return on average equity and average tangible equity (non-GAAP) remained healthy at 11.24% and 13.89%, respectively, compared to 13.90% and 17.91% for the third fiscal quarter a year ago.

Total net revenues were $14.7 million during the quarter compared to $14.9 million in the prior quarter and $14.5 million in the year ago quarter. Year-to-date, total net revenues increased to $44.1 million from $43.6 million in the same period a year ago.

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RVSB Reports Third Quarter Fiscal 2020 Results

January 23, 2020

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Net interest income for the quarter was $11.5 million compared to $11.7 million in both the preceding quarter and the third fiscal quarter a year ago. In the first nine months of fiscal 2020, net interest income was $34.7 million compared to $35.2 million in the first nine months of fiscal 2019. The decrease in net interest income for the nine months ended December 31, 2019 was primarily attributable to an increase in funding costs compared to the same prior year period in addition to $585,000 of non-accrual interest from a prior charged off loan that was collected during the nine months ended December 31, 2018.

Riverview’s third fiscal quarter NIM was 4.23% compared to 4.36% in the prior quarter and 4.41% in the third fiscal quarter a year ago. The accretion on purchased loans totaled $219,000 during the current quarter compared to $78,000 during the preceding quarter and $172,000 in the same period a year ago, resulting in an eight basis point increase in the NIM for the current period compared to a two basis point increase for the preceding quarter and a seven basis point increase for the same period a year ago. Net fees on loan prepayments were $211,000 for the third fiscal quarter of 2020, which added eight basis points to the NIM compared to $112,000 adding four basis point to the NIM in the preceding quarter, and $15,000 adding one basis point to the NIM in the third fiscal quarter a year ago. In the first nine months of fiscal 2020, Riverview’s NIM was 4.31% compared to 4.42% in the same period a year earlier. Net fees on loan prepayments were $355,000 for the nine-month period ended December 31, 2019, which added four basis points to the NIM compared to $297,000 adding three basis points to the NIM in the same nine-month period a year ago.

“Net interest margin remains healthy despite funding costs increasing by ten basis points during the quarter as a result of increased rates on certain deposit products to remain competitive in our market,” said David Lam, executive vice president and chief financial officer. “We anticipate that the three recent decreases in the fed funds rate along with the heightened competition in our market will continue to put pressure on our loan and deposit pricing, as well as the rest of the banking industry.”

Non-interest income was $3.2 million in the both the third and second fiscal quarters compared to $2.7 million in the third fiscal quarter a year ago. In the first nine months of fiscal 2020, non-interest income increased 12.2% to $9.5 million compared to $8.4 million in the same period a year ago. The improvement in non-interest income was primarily driven by service charges and asset management fees.

Asset management fees increased 21.5% compared to the same quarter a year ago. Asset management fees were $1.1 million during the third fiscal quarter compared to $935,000 in the third fiscal quarter a year ago. In the first nine months of fiscal 2020, asset management fees increased 20.1% to $3.4 million compared to $2.8 million in the first nine months of fiscal 2019. Riverview Trust Company’s assets under management increased substantially to $1.2 billion at December 31, 2019 compared to $690.5 million three months earlier, due primarily to a single large client added during the quarter.

In the third quarter of fiscal 2020, non-interest expense increased to $9.2 million compared to $9.0 million in the preceding quarter. Year-to-date, non-interest expense was $27.4 million compared to $26.7 million in the first nine months of fiscal 2019. The increase is attributable to strategic growth initiatives that included investments in our digital product offerings, as well as the addition of several key hires during the current fiscal year. Additionally, the preceding quarter included an $81,000 gain on the disposal of an asset that was recorded in other non-interest expense and decreased overall expense in the second quarter of fiscal 2020. The efficiency ratio was 63.10% for the third fiscal quarter compared to 60.47% in the preceding quarter and 60.87% in the third fiscal quarter a year ago.

For the third fiscal quarter of 2020, income tax expense totaled $1.3 million, for an effective tax rate of 23.7% compared to 23.0% in the second fiscal quarter of 2020 and 22.5% in the third fiscal quarter of 2019.

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RVSB Reports Third Quarter Fiscal 2020 Results

January 23, 2020

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Balance Sheet Review

Total deposits increased $8.2 million during the quarter to $990.5 million compared to $982.3 million three months earlier, and increased $46.9 million compared to $943.6 million a year earlier. Deposit costs increased to 0.38% during the third quarter compared to 0.28% in the preceding quarter, reflecting Riverview’s efforts to remain competitive in its Northwest markets by increasing selective deposit rates.

“Deposit growth was strong compared to a year ago, which helped keep our FHLB borrowings at zero throughout the quarter,” said Lam. “As a result, our loan to deposit ratio is at 89.5% at December 31, 2019 compared to 92.1% a year ago.” A year ago outstanding FHLB advances were $34.5 million.

Riverview’s total loans increased $5.2 million during the quarter to $886.5 million compared to $881.3 million three months earlier and increased $17.9 million compared to $868.6 million a year ago. Total loans continue to be impacted by an elevated level of paydowns on existing loans, however, the loan pipeline remained healthy at $64.5 million at December 31, 2019 compared to $43.8 million at the end of the prior quarter. Undisbursed construction loans totaled $36.0 million at December 31, 2019 compared to $53.3 million three months earlier, with the majority of the undisbursed construction loans expected to fund over the next several quarters.

Shareholders’ equity increased to $145.8 million at December 31, 2019 compared to $143.1 million three months earlier and $128.1 million a year earlier. Tangible book value per share (non-GAAP) increased to $5.18 at December 31, 2019 compared to $5.06 at September 30, 2019 and $4.43 at December 31, 2018. Riverview paid a quarterly cash dividend of $0.05 per share on January 21, 2020 to shareholders of record on January 9, 2020.

Credit Quality

“Our asset quality remains excellent, with non-performing loans, non-performing assets and classified assets continuing to decrease compared to a year ago,” said Lycklama. “Additionally, we continue to have no real estate owned and minimal charge-offs.” As a result of the continued improvement in asset quality, Riverview recorded no provision for loan losses during the past five quarters. Non-performing loans totaled $1.5 million, or 0.17% of total loans, at December 31, 2019, which was unchanged compared to September 30, 2019. Non-performing loans totaled $1.6 million, or 0.19% of total loans at December 31, 2018.

Net loan charge offs were $3,000 during the third fiscal quarter of 2020 compared to $6,000 in the preceding quarter and $11,000 in the third fiscal quarter a year ago.

Classified assets decreased to $3.1 million at December 31, 2019 compared to $4.3 million at September 30, 2019 and $6.0 million at December 31, 2018. The classified asset to total capital ratio was 2.1% at December 31, 2019 compared to 3.0% three months earlier and 4.4% a year earlier.

At December 31, 2019, the allowance for loan losses totaled $11.4 million, which was unchanged compared to three months earlier. The allowance for loan losses represented 1.29% of total loans at December 31, 2019 compared to 1.30% three months earlier. Included in the carrying value of loans are net discounts on the MBank purchased loans, which may reduce the need for an allowance for loan losses on these loans because they are carried at an amount below the outstanding principal balance. The remaining net discount on these purchased loans was $1.1 million at December 31, 2019 compared to $1.3 million at September 30, 2019 and $1.7 million at December 31, 2018.

Capital

Riverview continues to maintain capital levels well in excess of the regulatory requirements to be categorized as “well capitalized” with a total risk-based capital ratio of 17.66% and a Tier 1 leverage ratio of 12.05% at December 31, 2019. Tangible common equity to average tangible assets ratio (non-GAAP) increased to 10.20% at December 31, 2019.

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RVSB Reports Third Quarter Fiscal 2020 Results

January 23, 2020

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Non-GAAP Financial Measures

In addition to results presented in accordance with generally accepted accounting principles (“GAAP”), this press release contains certain non-GAAP financial measures. We believe that certain non-GAAP financial measures provide investors with information useful in understanding the Company’s financial performance; however, readers of this report are urged to review these non-GAAP financial measures in conjunction with GAAP results as reported.

Financial measures that exclude intangible assets are non-GAAP measures. To provide investors with a broader understanding of capital adequacy, Riverview provides non-GAAP financial measures for tangible common equity, along with the GAAP measure. Tangible shareholders’ equity is calculated as shareholders’ equity less goodwill and other intangible assets. In addition, tangible assets are total assets less goodwill and other intangible assets. We calculate tangible book value per share by dividing tangible shareholders’ equity by the number of common shares outstanding. This non-GAAP financial measure has inherent limitations, is not required to be uniformly applied and is not audited. Further, the non-GAAP financial measure should not be considered in isolation or as a substitute for book value per share or total shareholders' equity determined in accordance with GAAP and may not be comparable to similarly titled measures reported by other companies. Reconciliations of the GAAP and non-GAAP financial measures are presented below.

(Dollars in thousands)	December 31, 2019		September 30, 2019		December 31, 2018		March 31, 2019
Shareholders' equity	$	145,806	$	143,119	$	128,094	$	133,122
Goodwill		27,076		27,076		27,076		27,076
Core deposit intangible, net		799		839		966		920
Tangible shareholders' equity	$	117,931	$	115,204	$	100,052	$	105,126
Total assets	$	1,184,100	$	1,173,019	$	1,151,225	$	1,156,921
Goodwill		27,076		27,076		27,076		27,076
Core deposit intangible, net		799		839		966		920
Tangible assets	$	1,156,225	$	1,145,104	$	1,123,183	$	1,128,925

About Riverview

Riverview Bancorp, Inc. (www.riverviewbank.com) is headquartered in Vancouver, Washington – just north of Portland, Oregon, on the I-5 corridor. With assets of $1.18 billion at December 31, 2019, it is the parent company of the 96-year-old Riverview Community Bank, as well as Riverview Trust Company. The Bank offers true community banking services, focusing on providing the highest quality service and financial products to commercial and retail clients through 18 branches, including 14 in the Portland-Vancouver area, and 3 lending centers. For the past 6 years, Riverview has been named Best Bank by the readers of The Vancouver Business Journal, and The Columbian.

“Safe Harbor” statement under the Private Securities Litigation Reform Act of 1995: This press release contains forward-looking statements that are subject to risks and uncertainties, including, but not limited to: the Company’s ability to raise common capital; the credit risks of lending activities, including changes in the level and trend of loan delinquencies and write-offs and changes in the Company’s allowance for loan losses and provision for loan losses that may be impacted by deterioration in the housing and commercial real estate markets; changes in general economic conditions, either nationally or in the Company’s market areas; changes in the levels of general interest rates, and the relative differences between short and long term interest rates, deposit interest rates, the Company’s net interest margin and funding sources; fluctuations in the demand for loans, the number of unsold homes, land and other properties and fluctuations in real estate values in the Company’s market areas; secondary market conditions for loans and the Company’s ability to sell loans in the secondary market; results of examinations of us by the Office of Comptroller of the Currency or other regulatory authorities, including the possibility that any such regulatory authority may, among other things, require us to increase the Company’s reserve for loan losses, write-down assets, change Riverview Community Bank’s regulatory capital position or affect the Company’s ability to borrow funds or maintain or increase deposits, which could adversely affect its

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RVSB Reports Third Quarter Fiscal 2020 Results

January 23, 2020

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liquidity and earnings; legislative or regulatory changes that adversely affect the Company’s business including changes in regulatory policies and principles, or the interpretation of regulatory capital or other rules; the Company’s ability to attract and retain deposits; further increases in premiums for deposit insurance; the Company’s ability to control operating costs and expenses; the use of estimates in determining fair value of certain of the Company’s assets, which estimates may prove to be incorrect and result in significant declines in valuation; difficulties in reducing risks associated with the loans on the Company’s balance sheet; staffing fluctuations in response to product demand or the implementation of corporate strategies that affect the Company’s workforce and potential associated charges; computer systems on which the Company depends could fail or experience a security breach; the Company’s ability to retain key members of its senior management team; costs and effects of litigation, including settlements and judgments; the Company’s ability to successfully integrate any assets, liabilities, customers, systems, and management personnel it may in the future acquire into its operations and the Company’s ability to realize related revenue synergies and cost savings within expected time frames and any goodwill charges related thereto; increased competitive pressures among financial services companies; changes in consumer spending, borrowing and savings habits; the availability of resources to address changes in laws, rules, or regulations or to respond to regulatory actions; the Company’s ability to pay dividends on its common stock; and interest or principal payments on its junior subordinated debentures; adverse changes in the securities markets; inability of key third-party providers to perform their obligations to us; changes in accounting policies and practices, as may be adopted by the financial institution regulatory agencies or the Financial Accounting Standards Board, including additional guidance and interpretation on accounting issues and details of the implementation of new accounting methods; other economic, competitive, governmental, regulatory, and technological factors affecting the Company’s operations, pricing, products and services and the other risks described from time to time in our filings with the SEC.

Such forward-looking statements may include projections. Any such projections were not prepared in accordance with published guidelines of the American Institute of Certified Public Accountants or the Securities Exchange Commission regarding projections and forecasts nor have such projections been audited, examined or otherwise reviewed by independent auditors of the Company. In addition, such projections are based upon many estimates and inherently subject to significant economic and competitive uncertainties and contingencies, many of which are beyond the control of management of the Company. Accordingly, actual results may be materially higher or lower than those projected. The inclusion of such projections herein should not be regarded as a representation by the Company that the projections will prove to be correct.

The Company cautions readers not to place undue reliance on any forward-looking statements. Moreover, you should treat these statements as speaking only as of the date they are made and based only on information then actually known to the Company. The Company does not undertake and specifically disclaims any obligation to revise any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements. These risks could cause our actual results for fiscal 2020 and beyond to differ materially from those expressed in any forward-looking statements by, or on behalf of, us, and could negatively affect the Company’s operating and stock price performance.

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RVSB Reports Third Quarter Fiscal 2020 Results

January 23, 2020

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RIVERVIEW BANCORP, INC. AND SUBSIDIARY
Consolidated Balance Sheets
(In thousands, except share data)  (Unaudited)			September 30, 2019		December 31, 2018			March 31, 2019
ASSETS
Cash (including interest-earning accounts of 48,781, 32,632,	62,123		$	48,888	$	23,394		$	22,950
4,641 and 5,844)
Certificate of deposits held for investment	249			249		747			747
Loans held for sale	-			310		-			909
Investment securities:
Available for sale, at estimated fair value	155,757			163,682		182,280			178,226
Held to maturity, at amortized cost	29			31		36			35
Loans receivable (net of allowance for loan losses of 11,433,
11,436, 11,502, and 11,457)	875,100			869,880		857,134			864,659
Prepaid expenses and other assets	8,330			8,136		4,021			4,596
Accrued interest receivable	3,729			3,827		3,789			3,919
Federal Home Loan Bank stock, at cost	1,380			1,380		2,735			3,644
Premises and equipment, net	16,021			15,490		14,940			15,458
Deferred income taxes, net	3,416			3,296		4,680			4,195
Mortgage servicing rights, net	215			247		325			296
Goodwill	27,076			27,076		27,076			27,076
Core deposit intangible, net	799			839		966			920
Bank owned life insurance	29,876			29,688		29,102			29,291
TOTAL ASSETS	1,184,100		$	1,173,019	$	1,151,225		$	1,156,921
LIABILITIES AND SHAREHOLDERS' EQUITY
LIABILITIES:
Deposits	990,464		$	982,275	$	943,578		$	925,068
Accrued expenses and other liabilities	18,483			17,502		15,855			12,536
Advance payments by borrowers for taxes and insurance	329			1,117		192			631
Federal Home Loan Bank advances	-			-		34,543			56,586
Junior subordinated debentures	26,640			26,619		26,553			26,575
Capital lease obligations	2,378			2,387		2,410			2,403
Total liabilities	1,038,294			1,029,900		1,023,131			1,023,799
SHAREHOLDERS' EQUITY:
Serial preferred stock, .01 par value; 250,000 authorized,
issued and outstanding, none	-			-		-			-
Common stock, .01 par value; 50,000,000 authorized,
December 31, 2019 - 22,748,385 issued and outstanding;
September 30, 2019 - 22,748,385 issued and outstanding;	227			227		226			226
December 31, 2018 - 22,598,712 issued and outstanding;
March 31, 2019 – 22,607,712 issued and outstanding;
Additional paid-in capital	65,637			65,559		65,056			65,094
Retained earnings	80,103			77,112		67,126			70,428
Accumulated other comprehensive income (loss)	(161	)		221		(4,314	)		(2,626	)
Total shareholders’ equity	145,806			143,119		128,094			133,122
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	1,184,100		$	1,173,019	$	1,151,225		$	1,156,921

All values are in US Dollars.

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RVSB Reports Third Quarter Fiscal 2020 Results

January 23, 2020

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RIVERVIEW BANCORP, INC. AND SUBSIDIARY
Consolidated Statements of Income
	Three Months Ended						Nine Months Ended
(In thousands, except share data)   (Unaudited)	Dec. 31, 2019		Sept. 30, 2019		Dec. 31, 2018		Dec. 31, 2019		Dec. 31, 2018
INTEREST INCOME:
Interest and fees on loans receivable	$	11,699	$	11,893	$	11,182	$	35,146	$	33,261
Interest on investment securities - taxable		851		860		1,110		2,589		3,424
Interest on investment securities - nontaxable		27		36		37		100		110
Other interest and dividends		189		93		60		369		271
Total interest and dividend income		12,766		12,882		12,389		38,204		37,066
INTEREST EXPENSE:
Interest on deposits		942		660		240		1,953		759
Interest on borrowings		332		503		416		1,570		1,126
Total interest expense		1,274		1,163		656		3,523		1,885
Net interest income		11,492		11,719		11,733		34,681		35,181
Provision for loan losses		-		-		-		-		50
Net interest income after provision for, recapture of, loan losses		11,492		11,719		11,733		34,681		35,131
NON-INTEREST INCOME:
Fees and service charges		1,661		1,752		1,458		5,050		4,544
Asset management fees		1,136		1,090		935		3,369		2,804
Net gain on sale of loans held for sale		68		46		82		210		278
Bank owned life insurance		188		204		192		585		545
Other, net		110		77		62		254		267
Total non-interest income, net		3,163		3,169		2,729		9,468		8,438
NON-INTEREST EXPENSE:
Salaries and employee benefits		5,941		5,697		5,794		17,353		16,655
Occupancy and depreciation		1,461		1,277		1,306		4,058		4,016
Data processing		637		669		621		1,986		1,874
Amortization of core deposit intangible		40		41		45		121		137
Advertising and marketing		181		298		151		689		609
FDIC insurance premium		-		-		85		81		246
State and local taxes		126		174		125		495		475
Telecommunications		84		76		85		246		266
Professional fees		267		263		449		855		1,120
Other		511		508		142		1,561		1,339
Total non-interest expense		9,248		9,003		8,803		27,445		26,737
INCOME BEFORE INCOME TAXES		5,407		5,885		5,659		16,704		16,832
PROVISION FOR INCOME TAXES		1,279		1,351		1,271		3,850		3,773
NET INCOME	$	4,128	$	4,534	$	4,388	$	12,854	$	13,059
Earnings per common share:
Basic	$	0.18	$	0.20	$	0.19	$	0.57	$	0.58
Diluted	$	0.18	$	0.20	$	0.19	$	0.57	$	0.58
Weighted average number of common shares outstanding:
Basic		22,665,712		22,643,103		22,598,712		22,642,883		22,582,956
Diluted		22,718,255		22,702,696		22,663,919		22,701,415		22,658,153

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RVSB Reports Third Quarter Fiscal 2020 Results

January 23, 2020

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(Dollars in thousands)	At or for the three months ended						At or for the nine months ended
	Dec. 31, 2019		Sept. 30, 2019		Dec. 31, 2018		Dec. 31, 2019		Dec. 31, 2018
AVERAGE BALANCES
Average interest–earning assets	$	1,082,229	$	1,069,209	$	1,057,199	$	1,072,584	$	1,056,750
Average interest-bearing liabilities		726,294		708,846		707,618		721,345		716,890
Net average earning assets		355,935		360,363		349,581		351,239		339,860
Average loans		878,656		889,208		854,368		881,779		835,697
Average deposits		987,056		952,283		967,246		953,418		975,295
Average equity		146,090		142,195		125,252		141,644		122,298
Average tangible equity (non-GAAP)		118,192		114,256		97,182		113,706		94,182
ASSET QUALITY	Dec. 31, 2019			Sept. 30, 2019			Dec. 31, 2018
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Non-performing loans	$	1,517		$	1,485		$	1,612
Non-performing loans to total loans		0.17	%		0.17	%		0.19	%
Real estate/repossessed assets owned	$	-		$	-		$	-
Non-performing assets	$	1,517		$	1,485		$	1,612
Non-performing assets to total assets		0.13	%		0.13	%		0.14	%
Net loan charge-offs in the quarter	$	3		$	6		$	11
Net charge-offs in the quarter/average net loans		0.00	%		0.00	%		0.01	%
Allowance for loan losses	$	11,433		$	11,436		$	11,502
Average interest-earning assets to average
interest-bearing liabilities		149.01	%		150.84	%		149.40	%
Allowance for loan losses to
non-performing loans		753.66	%		770.10	%		713.52	%
Allowance for loan losses to total loans		1.29	%		1.30	%		1.32	%
Shareholders’ equity to assets		12.31	%		12.20	%		11.13	%
CAPITAL RATIOS
Total capital (to risk weighted assets)		17.66	%		17.27	%		16.35	%
Tier 1 capital (to risk weighted assets)		16.41	%		16.02	%		15.10	%
Common equity tier 1 (to risk weighted assets)		16.41	%		16.02	%		15.10	%
Tier 1 capital (to average tangible assets)		12.05	%		11.79	%		11.22	%
Tangible common equity (to average tangible assets) (non-GAAP)		10.20	%		10.06	%		8.91	%
DEPOSIT MIX	Dec. 31, 2019		Sept. 30, 2019		Dec. 31, 2018		March 31, 2019
---	---	---	---	---	---	---	---	---
Interest checking	$	179,447	$	178,854	$	183,426	$	183,388
Regular savings		217,004		196,340		137,323		137,503
Money market deposit accounts		183,076		186,842		242,081		233,317
Non-interest checking		279,564		299,062		284,939		284,854
Certificates of deposit		131,373		121,177		95,809		86,006
Total deposits	$	990,464	$	982,275	$	943,578	$	925,068

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RVSB Reports Third Quarter Fiscal 2020 Results

January 23, 2020

Page 9

COMPOSITION OF COMMERCIAL AND CONSTRUCTION LOANS
			Other				Commercial
	Commercial		Real Estate		Real Estate		& Construction
	Business		Mortgage		Construction		Total
December 31, 2019	(Dollars in thousands)
Commercial business	$	165,526	$	-	$	-	$	165,526
Commercial construction		-		-		79,034		79,034
Office buildings		-		109,517		-		109,517
Warehouse/industrial		-		99,167		-		99,167
Retail/shopping centers/strip malls		-		67,874		-		67,874
Assisted living facilities		-		1,075		-		1,075
Single purpose facilities		-		192,530		-		192,530
Land		-		15,163		-		15,163
Multi-family		-		57,792		-		57,792
One-to-four family construction		-		-		9,838		9,838
Total	$	165,526	$	543,118	$	88,872	$	797,516
March 31, 2019
Commercial business	$	162,796	$	-	$	-	$	162,796
Commercial construction		-		-		70,533		70,533
Office buildings		-		118,722		-		118,722
Warehouse/industrial		-		91,787		-		91,787
Retail/shopping centers/strip malls		-		64,934		-		64,934
Assisted living facilities		-		2,740		-		2,740
Single purpose facilities		-		183,249		-		183,249
Land		-		17,027		-		17,027
Multi-family		-		51,570		-		51,570
One-to-four family construction		-		-		20,349		20,349
Total	$	162,796	$	530,029	$	90,882	$	783,707
LOAN MIX	Dec. 31, 2019		Sept. 30, 2019		Dec. 31, 2018		March 31, 2019
Commercial and construction
Commercial business	$	165,526	$	167,782	$	154,360	$	162,796
Other real estate mortgage		543,118		541,715		541,797		530,029
Real estate construction		88,872		83,174		76,518		90,882
Total commercial and construction		797,516		792,671		772,675		783,707
Consumer
Real estate one-to-four family		83,978		82,578		86,240		84,053
Other installment		5,039		6,067		9,721		8,356
Total consumer		89,017		88,645		95,961		92,409
Total loans		886,533		881,316		868,636		876,116
Less:
Allowance for loan losses		11,433		11,436		11,502		11,457
Loans receivable, net	$	875,100	$	869,880	$	857,134	$	864,659

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RVSB Reports Third Quarter Fiscal 2020 Results

January 23, 2020

Page 10

DETAIL OF NON-PERFORMING ASSETS
	Other		Southwest
	Oregon		Washington		Other		Total
December 31, 2019
Commercial business	$	-	$	299	$	-	$	299
Commercial real estate		851		168		-		1,019
Consumer		-		179		20		199
Total non-performing assets	$	851	$	646	$	20	$	1,517
DETAIL OF LAND DEVELOPMENT AND SPECULATIVE CONSTRUCTION LOANS
---	---	---	---	---	---	---	---	---
	Northwest		Other		Southwest
	Oregon		Oregon		Washington		Total
December 31, 2019	(dollars in thousands)
Land development	$	2,175	$	1,852	$	11,136	$	15,163
Speculative construction		278		-		9,496		9,774
Total land development and speculative construction	$	2,453	$	1,852	$	20,632	$	24,937

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RVSB Reports Third Quarter Fiscal 2020 Results

January 23, 2020

Page 11

	At or for the three months ended									At or for the nine months ended
SELECTED OPERATING DATA	Dec. 31, 2019			Sept. 30, 2019			Dec. 31, 2018			Dec. 31, 2019			Dec. 31, 2018
Efficiency ratio (4)		63.10	%		60.47	%		60.87	%		62.16	%		61.30	%
Coverage ratio (6)		124.26	%		130.17	%		133.28	%		126.37	%		131.58	%
Return on average assets (1)		1.40	%		1.55	%		1.53	%		1.47	%		1.52	%
Return on average equity (1)		11.24	%		12.68	%		13.90	%		12.08	%		14.17	%
Return on average tangible equity (1) (non-GAAP)		13.89	%		15.79	%		17.91	%		15.05	%		18.40	%
NET INTEREST SPREAD
Yield on loans		5.30	%		5.32	%		5.19	%		5.30	%		5.28	%
Yield on investment securities		2.21	%		2.15	%		2.38	%		2.15	%		2.32	%
Total yield on interest-earning assets		4.70	%		4.80	%		4.65	%		4.74	%		4.66	%
Cost of interest-bearing deposits		0.54	%		0.40	%		0.14	%		0.39	%		0.15	%
Cost of FHLB advances and other borrowings		4.55	%		3.72	%		4.35	%		3.71	%		4.49	%
Total cost of interest-bearing liabilities		0.70	%		0.65	%		0.37	%		0.65	%		0.35	%
Spread (7)		4.00	%		4.15	%		4.28	%		4.09	%		4.31	%
Net interest margin		4.23	%		4.36	%		4.41	%		4.31	%		4.42	%
PER SHARE DATA
Basic earnings per share (2)	$	0.18		$	0.20		$	0.19		$	0.57		$	0.58
Diluted earnings per share (3)		0.18			0.20			0.19			0.57			0.58
Book value per share (5)		6.41			6.29			5.67			6.41			5.67
Tangible book value per share (5) (non-GAAP)		5.18			5.06			4.43			5.18			4.43
Market price per share:
High for the period	$	8.45		$	8.55		$	8.75		$	8.55		$	9.91
Low for the period		6.94			6.87			7.03			6.87			7.03
Close for period end		8.21			7.38			7.28			8.21			7.28
Cash dividends declared per share		0.0500			0.0450			0.0400			0.1400			0.1100
Average number of shares outstanding:
Basic (2)		22,665,712			22,643,103			22,598,712			22,642,883			22,582,956
Diluted (3)		22,718,255			22,702,696			22,663,919			22,701,415			22,658,153
(1)	Amounts for the quarterly periods are annualized.
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(2)	Amounts exclude ESOP shares not committed to be released.
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(3)	Amounts exclude ESOP shares not committed to be released and include common stock equivalents.
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(4)	Non-interest expense divided by net interest income and non-interest income.
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(5)	Amounts calculated based on shareholders’ equity and include ESOP shares not committed to be released.
---	---
(6)	Net interest income divided by non-interest expense.
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(7)	Yield on interest-earning assets less cost of funds on interest-bearing liabilities.
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