Riverview Bancorp’s recent appointment of an institutional investor to its board of directors has triggered speculation that the Vancouver-based banking company, parent of Riverview Community Bank, could become the target of a corporate takeover.
The bank’s president, Ron Wysaske, says emphatically that Riverview is not for sale and that bank officials have no interest in Riverview becoming an acquisition target.
“There’s no plan here to sell the bank. We want to maintain our independence,” Wysaske said.
But such statements, consistent year after year, haven’t tamped recent speculation that the bank, having recovered financially from the heavy weight of failed loans during the economic downturn, may be an attractive target for acquisition. The trigger for the current discussion was Riverview’s appointment of James M. Chadwick, portfolio adviser for Cleveland-based Ancora Advisors, as the ninth member of Riverview’s board of directors. Ancora holds an 8.7 percent stake in Riverview and had requested a seat on the board.
Riverview, after reviewing Charwick’s credentials, agreed that an institutional investor’s perspective would be valuable.
“We’ve got room on our board, and we welcome their help to grow and prosper and improve our performance,” Wysaske said.
The appointment included a condition that Ancora will not launch a proxy contest against the bank, try to force a sale or exert control over Riverview’s management team. A so-called standstill agreement against the launch of a takeover will remain in effect until Riverview’s 2017 annual meeting, or six months after Chadwick’s last day as a Riverview director.
The investor blog The Street said Monday in an article by research analyst Nicholas Durante that even with those restrictions, “suitors are likely circling” Riverview. Durante speculated that Riverview Bancorp would fetch a sale price that would be 15 percent above Monday’s price, or a valuation of $113.11 million, or $5.11 per share. Riverview’s share price closed Tuesday at $4.62 per share after two days of increases from Friday’s close of $4.37 per share.
Last October, Ancora submitted a letter to Patrick Sheaffer, Riverview’s chairman and CEO, calling for a sale of the bank, The letter said the bank would attract numerous suitors, “given its strong deposit base and attractive core markets.”
Other institutional investors in Riverview with large holdings are the Wellington Management Group, with an 8.9 percent stake, and Basswood Capital Management, with 5.9 percent ownership. The Federal Deposit insurance Corporation’s most recent “Summary of Deposits” report, released this week for the period ending June 30, lists Riverview as the sixth-largest bank in Clark County based on local deposits, with a 9.67 percent market share. It held the same position in the previous period one year ago, with 10.07 percent of deposits. It had $499 million in deposits in Clark County on June 30, up from $477 million a year earlier
“We’re happy with our share of the market,” Wysaske said. “The overall market is growing. We’ve got our share, and we’re able to put that cash to work.”
Riverview, with total assets of $860 million, operates 17 branches, including 10 in Clark County, and three lending centers.