Vancouver-based Riverview Bancorp Inc., parent of Riverview Community Bank, ended its quarter and its fiscal year in positive earnings territory, showing continuing reductions in troubled loans and a steady decline in bank-owned real estate.
Riverview reported earnings of $1.6 million, or $0.07 per diluted share, for its fourth fiscal quarter ending March 31. That was a healthy improvement over the previous quarter’s earnings of $1 million, and a remarkable turnaround from its net loss of $16 million in last fiscal year’s fourth quarter.
Riverview reduced its portfolio of non-performing loans by $3.5 million, leaving it with $21.1 million in troubled loans. It shrank its bank-owned real estate by almost 25 percent, to $15.6 million.
“We’ve worked extremely hard over multiple quarters,” said Kim Capeloto, Riverview’s executive vice president for marketing and operations. “The numbers are moving in the right direction because of the immense hard work of our staff.”
For all of fiscal year 2013, which ended March 31, Riverview earned $2.6 million. In the previous fiscal year, the bank had lost $31.7 million as it wrote off losses for troubled loans that it had kept on its books long after other banks had taken losses.
“We are very proud of the fundamental improvements our entire organization has made over the last twelve months,” said Pat Sheaffer, the bank’s chairman and CEO, in a news release.
Capeloto said the bank is seeing success in its heavily marketed effort to generate some $100 million in new loans over the year. Now at 10 months into the initiative, Riverview has issued some $85 million in new loans, Capeloto said. Banks have struggled to attract income-producing loans during the slow economic recovery, as potential borrowers struggle to rebuild credit and decide to take the risk of borrowing money.
“We’ve had to go out and work hard to get loans,” Capeloto said. “There’s been some pick-and-shovel work.”
Riverview also reaped some benefits of an internal program of offering incentives to employees who came up with viable ideas to improve efficiencies and save money. One employee earned a $17,000 incentive payment for an idea that saves the bank close to $180,000 annually, Capeloto said.
Riverview reported assets of $777 million. It has 18 branches, including thirteen in the Portland-Vancouver area, and three lending centers.