Riverview Financial 8K Reports First Quarter Financial Results for 2021 | RIVE 22 Apr 21


NEWS RELEASE		Exhibit 99.1

RIVERVIEW FINANCIAL CORPORATION

REPORTS FIRST QUARTER FINANCIAL RESULTS FOR 2021

HARRISBURG, PA, April 21, 2021 / PRNEWSWIRE / Riverview Financial Corporation (the “Company” or “Riverview”) (NASDAQ: RIVE), the holding company for Riverview Bank (the “Bank”), today reported unaudited financial results at and for the three months ended March 31, 2021. Riverview reported net income of $3.1 million, or $0.33 per basic and diluted weighted average common share, for the first quarter of 2021, compared to net income of $633 thousand, or $0.07 per basic and diluted weighted average common share, for the first quarter of 2020.

The increase in the Company’s earnings for the three months ended March 31, 2021 as compared to the same period in 2020 was the result of the impact of ongoing efficiency initiatives, including branch office consolidations, an increase in loan income from the recognition of interest and fees earned on Paycheck Protection Program (“PPP”) Loans and lower deposit costs. The Company implemented cost reduction strategies beginning in 2019, and those efforts continued through the end of the fourth quarter of 2020 by implementing additional efficiency initiatives aimed at substantially lowering operating costs. The COVID-19 pandemic continues to place additional pressure on Bank earnings, causing increased emphasis on the need to improve operational efficiency to help mitigate margin compression and noninterest income reductions. As a result, Riverview closed two branch offices in January 2021 and will be completing the sale of two additional branches in May of 2021.

HIGHLIGHTS

•

Return on average stockholders’ equity and return on average total assets were 12.55% and 0.91% for the first quarter 2021. Return on average tangible stockholders’ equity was 12.78% for the first quarter 2021.

•

Tangible book value increased $0.49 per share to $10.36 per share at March 31, 2021 from $9.87 per share at March 31, 2020.

•

Tax-equivalent net interest income improved 9.6% to $9.7 million for the quarter ended March 31, 2021, compared to $8.8 million for the comparable quarter of 2020.

•

Total interest-bearing deposit costs declined 47 basis points to 0.43% for the first quarter 2021 compared to 0.90% for the same quarter 2020.

•

Noninterest bearing deposits increased 32.8% to $197.4 million at March 31, 2021 from $148.6 million at March 31, 2020, demonstrating success in our strategy to place greater emphasis on growth in lower cost of funds deposit accounts.

•

Operating efficiency ratio improved to 68.94% in the first quarter of 2021 compared to 82.49% in the comparable quarter of 2020.

•

Realized a 9.1% year over year reduction in total noninterest expense. For the three months ended March 31, noninterest expense decreased to $8.4 million in 2021 compared to $9.2 million in 2020.

•

Total loans 30 or more days past due plus nonaccrual loan balances total $4.3 million, or 0.39% of total loans outstanding, the lowest quarter end dollar level since December 2016.

•

For the three months ended March 31, net charge-offs to average loans, net were 0.02% in 2021 and 0.49% in 2020.

•

The allowance for loan losses totaled $12.1 million, or 1.11% of loans, net at March 31, 2021 compared to $8.3 million or 0.93% of loans, net at March 31, 2020. Excluding 100% SBA guaranteed PPP loan balances, the allowance for loan losses represented 1.38% of loans, net at March 31, 2021.

•

Nonperforming assets totaled $13.2 million or 1.20% of loans, net and foreclosed assets at March 31, 2021. Excluding performing troubled debt restructured loans, nonperforming assets represented 0.29% of loans, net and foreclosed assets at the end of the first quarter 2021.

•

The coverage ratio, the allowance for loan losses as a percentage of nonperforming assets, was 92.3% at March 31, 2021. Excluding accruing restructured loans, the coverage ratio was 378.0% at March 31, 2021.

•

Continued reduction in COVID-19 pandemic related loan deferments during the first quarter of 2021. As of March 31, 2021, loans in deferment consist of 15 loans totaling $18.6 million, representing 1.7% of total outstanding loan balances, or 2.1% excluding outstanding PPP loan balances. Total current principal and interest deferred for these 15 loans totaled $1.3 million. As of December 31, 2020, loans in deferment consists of 19 loans totaling $21.9 million, representing 1.92% of total outstanding loan balances, or 2.46% excluding outstanding PPP loan balances.

•

Funded $19.3 million of loans through the second round of the CARES Act Paycheck Protection Program in the first quarter 2021. Aggregate remaining accrued and unearned Small Business Administration PPP origination fees total $5.0 million at March 31, 2021.

•

Tangible stockholders’ equity to tangible assets, excluding PPP loans, was 8.36% at March 31, 2021.

Brett D. Fulk, President and CEO, commented, “It is truly a pleasure to report first quarter 2021 earnings of $0.33 per share, an increase of 94%, when compared to the previous quarter’s $0.17 per share. First quarter 2021 earnings also compare quite favorably to the $0.07 per share reported for the same period last year. This significant improvement in earnings is the direct result of previously disclosed efficiency initiatives that began in 2019, significant PPP loan generation during 2020, and ongoing expense and pricing discipline. Additionally, despite the challenges to the economy created by the COVID-19 virus, I am pleased to also report strong credit quality metrics for the first quarter. At the end of the first quarter 2021, we reported the lowest level of nonaccrual and past due loan balances since the fourth quarter of 2016. It is particularly gratifying to report solid credit quality when it is due in no small measure to intentional strategic decisions implemented proactively to reduce the credit risk profile of our balance sheet in the two years prior to the COVID-19 outbreak. The invaluable hard work and dedication of our outstanding employees, coupled with focused strategic initiatives developed and deployed to increase core earnings on a consistent basis, is the reason we have achieved these results. The effectiveness of our efforts is evidenced by first quarter 2021 return on average assets and return on average tangible stockholder equity results of 0.91% and 12.78% respectively.” Fulk continued, “while we are not yet through the current margin compression cycle or beyond potential negative impact to credits within our portfolio resulting from the ongoing pandemic environment, continued results such as these will ultimately allow us to revisit our current dividend policy, as well as establishing a core earnings platform necessary to provide enhanced long-term shareholder returns.”

Fulk concluded “Organic loan growth remained muted and outstanding loan balances declined during the first quarter of 2021 as receipt of PPP loan forgiveness applications accelerated and related loan balances were repaid by the SBA. However, we are beginning to experience increased loan application activity as local economies and businesses begin to reopen and recently hired commercial relationship managers introduce opportunities for us with customers that have become disenfranchised with their current banks. These customers are those that place a high value upon responsiveness, local representation and personal relationships, all areas in which we excel. I anticipate organic loan growth to accelerate throughout the remainder of 2021 as the economy continues to reopen

and we leverage our past expansion into new growth markets, expand upon new relationships created by processing PPP loans for non-bank customers in both rounds of PPP lending, and hire additional experienced and established asset generation team members throughout our markets.”

INCOME STATEMENT REVIEW

Tax-equivalent net interest income for the three months ended March 31, increased to $9.7 million in 2021 from $8.8 million in 2020. The increase in tax-equivalent net interest income was primarily attributable to the recognition of interest and fees earned on PPP loans and lower deposit costs. The tax-equivalent net interest margin for the three months ended March 31, 2021, decreased to 3.04% from 3.60% for the comparable period of 2020. The tax-equivalent net interest margin, excluding income and fees earned on PPP loans, was 3.19% in the first quarter of 2021. The tax-equivalent yield on the loan portfolio decreased to 3.82% in the first quarter of 2021 compared to 4.64% in first quarter of 2020. The actions taken by the Federal Open Market Committee in March 2020 to reduce its target federal funds rate by 150 basis points impacted the loan portfolio yield as it had a corresponding adverse effect on our floating and adjustable rate loans along with lower yields on new originations compared to those on payments and prepayment on existing loans. Investments yielded 2.09% on a tax-equivalent basis in the first quarter of 2021 compared to 2.85% for the same period last year. For the three months ended March 31, the cost of deposits decreased 47 basis points to 0.43% in 2021 from 0.90% in 2020. Loans, net averaged $1.1 billion in the first quarter of 2021 and $874.4 million in the first quarter of 2020. Average investments totaled $133.0 million in 2021 and $82.0 million in 2020. Average interest-bearing liabilities increased to $1.1 billion in 2021 from $807.9 million for the three months ended March 31, 2020.

The Company did not recognize a charge in the form of a provision for loan losses in the first quarter of 2021 based on the results from its adequacy modeling of the allowance for loan loss account at March 31, 2021. Comparatively, the provision for loan losses totaled $1.8 million for the same period in 2020. The 2020 increase in the provision for loan losses was the combined result of organic loan growth, excluding PPP loan balances outstanding, and changes in qualitative factors related to the allowance for loan losses reserve associated with increasing risks within the economy and our credit portfolio due to the effects of COVID-19.

For the quarter ended March 31, noninterest income decreased by $407 thousand to $2.5 million in 2021 from $2.9 million in 2020. The primary contributor to the overall decrease was $569 thousand less in gains on the sale of investment securities offset partially by increases in service charges, fees and commissions of $93 thousand and the recognition of higher comparable trust and mortgage banking income of $47 thousand and $43 thousand.

Noninterest expense decreased to $8.4 million for the three months ended March 31, 2021, from $9.2 million for the same period last year. The overall decrease was primarily due to a decrease of $589 thousand in salaries and employee benefit expenses due to the implementation of the reduction in force initiatives from branch closures and consolidation of departments. Other expenses decreased $190 thousand comparing the first quarters of 2021 and 2020 due to implementing efficiency initiatives and selective expense reductions made during the COVID-19 shutdowns.

BALANCE SHEET REVIEW

Total assets, loans, net, and deposits totaled $1.4 billion, $1.1 billion, and $1.1 billion, respectively, at March 31, 2021. For the three months ended March 31, 2021, total assets and deposits increased $17.3 million, and $65.5 million, respectively. Loans, net decreased $47.4 million in the first quarter of 2021 as business lending, including commercial and commercial real estate loans, decreased $44.7 million due primarily to SBA forgiveness payments on PPP loans. For this same period, construction lending increased $4.9 million while retail lending, which includes residential mortgage, home equity and consumer loans, decreased $7.6 million. Total investments increased to $155.9 million at March 31, 2021, compared to $103.7 million at December 31, 2020 as security purchases more than offset payments and prepayments. The increase in total deposits consisted of increases in noninterest-bearing deposits of $23.8 million and interest-bearing deposits of $41.7 million. As a percentage of total deposits, noninterest-bearing deposits amounted to 18.3% at March 31, 2021 and 17.1% at December 31, 2020. Long term debt decreased $48.1 million primarily through the repayment of the Federal Reserve’s PPPLF program as PPP loans were forgiven in the first quarter of 2021.

Stockholders’ equity totaled $98.6 million, or $10.55 per share, at March 31, 2021 and $97.4 million, or $10.47 per share, at December 31, 2020. The increase in stockholders’ equity for the three months ended March 31, 2021 was due primarily to recognizing earnings partially offset by a change in accumulated other comprehensive income. Tangible stockholders’ equity per common share increased to $10.36 at March 31, 2021, compared to $9.87 at March 31, 2020.

ASSET QUALITY REVIEW

Nonperforming assets were $13.2 million, or 1.20% of loans, net, and foreclosed assets at March 31, 2021, $12.0 million or 1.05% at December 31, 2020, and $5.7 million or 0.65% at March 31, 2020. Nonaccrual loan growth of $1.4 million caused primarily by one commercial relationship was responsible for the increase in the first quarter of 2021. Accruing troubled debt restructured (“TDR”) loans totaled $9.9 million at March 31, 2021 and was due primarily to one commercial real estate relationship. Adjusting for accruing restructured loans, nonperforming assets were $3.2 million, or 0.29% of loans, net and foreclosed assets at March 31, 2021, and $2.0 million, or 0.18%, at December 31, 2020. The allowance for loan losses balance equaled $12.1 million, or 1.11%, of loans, net, and 1.38% excluding 100% SBA guaranteed PPP loan balances outstanding, at March 31, 2021, compared to $12.2 million, or 1.07%, of loans, net, and 1.37% excluding 100% SBA guaranteed PPP loan balances outstanding at December 31, 2020. The coverage ratio, the allowance for loan losses as a percentage of nonperforming assets, was 92.3% at March 31, 2021 and 102.0% at December 31, 2020. Excluding accruing restructured loans, the coverage ratio was 378.0% at March 31, 2021. Loans charged-off, net of recoveries, for the three months ended March 31, 2021 equaled $60 thousand compared to $1.1 million for the same period last year.

Riverview Financial Corporation is the parent company of Riverview Bank. An independent community bank, Riverview Bank serves the Pennsylvania market areas of Berks, Blair, Bucks, Centre, Clearfield, Dauphin, Huntingdon, Lebanon, Lehigh, Lycoming, Perry, Schuylkill and Somerset Counties through 25 community banking offices and three limited purpose offices. Each full-service community banking office, interdependent with the community, offers a comprehensive array of financial products and services to individuals, businesses, not-for-profit organizations and government entities. 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/.

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’s operations, pricing, products and services and other factors that may be described in Riverview’s 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. Beginning with the first quarter of 2020, the COVID-19 pandemic continues to have an adverse impact on the Company, its customers and the communities it serves. Given its ongoing and dynamic nature, it is difficult to predict the full impact of the COVID-19 outbreak on the Company’s business. The extent of such impact will depend on future developments, which are highly uncertain, including when the coronavirus can be controlled and abated and when and how the economy may be back to normal. As the result of the COVID-19 pandemic and the related adverse local and national economic

consequences, the Company could be subject to any of the following risks, any of which could have a material, adverse effect on the Company’s business, financial condition, liquidity, and results of operations: the demand for Bank’s products and services may decline, making it difficult to grow assets and income; if the economy is unable to continue to substantially reopen, and higher levels of unemployment persist, loan delinquencies, problem assets, and foreclosures may increase, resulting in increased charges and reduced income; collateral for loans, especially real estate, may decline in value, which could cause loan losses to increase; the Company’s allowance for loan losses may increase if borrowers experience financial difficulties, which will adversely affect the Company’s net income; the net worth and liquidity of loan guarantors may decline, impairing their ability to honor commitments to the Company; as the result of the decline in the Federal Reserve Board’s target federal funds rate to near 0%, the yield on the Company’s assets may decline to a greater extent than the decline in the Company’s cost of interest-bearing liabilities, continue reducing the Company’s net interest margin and spread and net income; the Company’s wealth management revenues may decline with continuing market turmoil; and the Company’s cybersecurity risks are increased as the result of an increase in the number of employees working remotely. The risk factors associated with this event could have a material adverse effect on significant estimates, operations and business results of Riverview. Significant estimates as disclosed in Riverview’s Forms 10-K and 10-Q include allowance for loan losses, fair value of financial instruments, the valuation of real estate acquired in connection with foreclosures or in satisfaction of loan, determination of other-than-temporary impairment losses on securities, impairment of goodwill and intangible assets.

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 included in this press release 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			Sep 30			Jun 30			Mar 31
	2021			2020			2020			2020			2020
Key performance data:

Per common share data:
Net income (loss)	$	0.33		$	0.17		$	0.08		$	(2.61	)	$	0.07
Core net income (1)	$	0.31		$	0.17		$	0.07		$	0.05		$	0.00
Cash dividends declared	$	0.00		$	0.00		$	0.00		$	0.08		$	0.08
Book value	$	10.55		$	10.47		$	10.28		$	10.20		$	12.82
Tangible book value (1)	$	10.36		$	10.26		$	10.04		$	9.94		$	9.87
Market value:
High	$	10.82		$	9.50		$	7.77		$	7.60		$	13.60
Low	$	9.01		$	6.76		$	5.25		$	4.13		$	5.25
Closing	$	10.45		$	9.15		$	6.76		$	5.38		$	6.47
Market capitalization	$	97,695		$	85,154		$	62,729		$	49,839		$	59,757
Common shares outstanding		9,348,831			9,306,442			9,279,503			9,263,697			9,236,039

Selected ratios:

Return on average stockholders’ equity		12.55	%		6.51	%		2.88	%		(81.21	)%		2.14	%

Core return on average stockholders’ equity ⁽¹⁾		11.75	%		6.51	%		2.88	%		1.55	%		(0.04	)%

Return on average tangible stockholders’ equity ⁽¹⁾		12.78	%		6.66	%		2.95	%		(104.88	)%		2.77	%

Core return on average tangible stockholders’ equity ⁽¹⁾		11.97	%		6.66	%		2.95	%		2.00	%		(0.05	)%

Tangible stockholders’ equity to tangible assets ⁽¹⁾		7.05	%		7.05	%		6.88	%		6.85	%		8.36	%

Return on average assets		0.91	%		0.46	%		0.20	%		(7.50	)%		0.23	%

Core return on average assets ⁽¹⁾		0.85	%		0.46	%		0.20	%		0.14	%		0.00	%

Stockholders’ equity to total assets		7.17	%		7.18	%		7.03	%		7.01	%		10.60	%

Efficiency ratio ⁽²⁾		68.94	%		76.13	%		77.46	%		76.84	%		82.49	%

Nonperforming assets to loans, net, and foreclosed assets		1.20	%		1.05	%		1.12	%		1.15	%		0.65	%

Net charge-offs to average loans, net		0.02	%		0.02	%		(0.02	)%		0.20	%		0.49	%

Allowance for loan losses to loans, net		1.11	%		1.07	%		1.00	%		0.84	%		0.93	%

Earning assets yield (FTE) ⁽³⁾		3.54	%		3.74	%		3.73	%		3.85	%		4.39	%

Cost of funds		0.59	%		0.63	%		0.56	%		0.67	%		0.95	%

Net interest spread (FTE) ⁽³⁾		2.95	%		3.11	%		3.17	%		3.18	%		3.44	%

Net interest margin (FTE) ⁽³⁾		3.04	%		3.21	%		3.26	%		3.29	%		3.60	%

(1)	See Reconciliation of Non-GAAP financial measures.

(2)	Total noninterest expense less amortization of intangible assets and goodwill impairment charge 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

(In thousands, except per share data)


Three Months Ended	Mar 31			Mar 31
	2021			2020
Interest income:
Interest and fees on loans:
Taxable	$	10,348		$	9,782
Tax-exempt		176			245
Interest and dividends on investment securities:
Taxable		494			535
Tax-exempt		152			37
Interest on interest-bearing deposits in other banks		9			89
Total interest income		11,179			10,688

Interest expense:
Interest on deposits		923			1,789
Interest on short-term borrowings					5
Interest on long-term debt		646			123
Total interest expense		1,569			1,917
Net interest income		9,610			8,771
Provision for loan losses					1,800
Net interest income after provision for loan losses		9,610			6,971

Noninterest income:
Service charges, fees and commissions		1,474			1,381
Commissions and fees on fiduciary activities		260			213
Wealth management income		214			220
Mortgage banking income		151			108
Life insurance investment income		178			193
Net gain (loss) on sale of investment securities available-for-sale		246			815
Total noninterest income		2,523			2,930

Noninterest expense:
Salaries and employee benefits expense		4,467			5,056
Net occupancy and equipment expense		1,190			1,180
Amortization of intangible assets		132			170
Net cost (benefit) of operation of other real estate owned		(29	)		(11	)
Other expenses		2,627			2,817
Total noninterest expense		8,387			9,212
Income before income taxes		3,746			689
Income tax expense		686			56
Net income	$	3,060		$	633
Other comprehensive income:
Unrealized gain on investment securities available-for-sale	$	(3,029	)	$	1,053
Reclassification adjustment for (gain) loss included in net income		(246	)		(815	)
Change in pension liability
Change in cash flow hedge		657
Income tax expense related to other comprehensive income		(550	)		50
Other comprehensive income (loss), net of income taxes		(2,068	)		188
Comprehensive income (loss)	$	992		$	821

Per common share data:
Net income (loss):
Basic	$	0.33		$	0.07
Diluted	$	0.33		$	0.07
Average common shares outstanding:
Basic		9,341,291			9,223,445
Diluted		9,341,533			9,233,060
Cash dividends declared	$	0.00		$	0.08

Riverview Financial Corporation

Consolidated Statements of Income (Loss)

(In thousands, except per share data)


Three months ended	Mar 31			Dec 30		Sep 30		Jun 30			Mar 31
	2021			2020		2020		2020			2020
Interest income:
Interest and fees on loans:
Taxable	$	10,348		$	11,403	$	11,265	$	10,602		$	9,782
Tax-exempt		176			179		223		236			245
Interest and dividends on investment securities available-for-sale:
Taxable		494			411		360		396			535
Tax-exempt		152			113		71		68			37
Interest on interest-bearing deposits in other banks		9			8		11		12			89
Total interest income		11,179			12,114		11,930		11,314			10,688

Interest expense:
Interest on deposits		923			1,035		1,200		1,395			1,789
Interest on short-term borrowings									23			5
Interest on long-term debt		646			684		304		225			123
Total interest expense		1,569			1,719		1,504		1,643			1,917
Net interest income		9,610			10,395		10,426		9,671			8,771
Provision for loan losses					626		1,844		2,012			1,800
Net interest income after provision for loan losses		9,610			9,769		8,582		7,659			6,971

Noninterest income:
Service charges, fees and commissions		1,474			642		1,099		1,011			1,381
Commissions and fees on fiduciary activities		260			292		246		210			213
Wealth management income		214			240		220		196			220
Mortgage banking income		151			333		401		391			108
Life insurance investment income		178			177		192		193			193
Net gain (loss) on sale of investment securities available-for-sale		246										815
Total noninterest income		2,523			1,684		2,158		2,001			2,930

Noninterest expense:
Salaries and employee benefits expense		4,467			4,755		5,411		4,985			5,056
Net occupancy and equipment expense		1,190			1,465		1,428		1,068			1,180
Amortization of intangible assets		132			309		170		169			170
Goodwill impairment									24,754
Net cost (benefit) of operation of other real estate owned		(29	)		15		51					(11	)
Other expenses		2,627			3,020		2,918		2,978			2,817
Total noninterest expense		8,387			9,564		9,978		33,954			9,212
Income (loss) before income taxes		3,746			1,889		762		(24,294	)		689
Income tax expense (benefit)		686			306		67		(172	)		56
Net income (loss)	$	3,060		$	1,583	$	695	$	(24,122	)	$	633

Other comprehensive income (loss):
Unrealized gain (loss) on investment securities available-for-sale	$	(3,029	)	$	94	$	114	$	840		$	1,053
Reclassification adjustment for (gain) loss included in net income		(246	)									(815	)
Change in pension liability					166
Change in cash flow hedge		657			161		49		(38	)
Income tax expense (benefit) related to other comprehensive income (loss)		(550	)		88		35		168			50
Other comprehensive income (loss), net of income taxes		(2,068	)		333		128		634			188
Comprehensive income (loss)	$	992		$	1,916	$	823	$	(23,488	)	$	821
Per common share data:
Net income (loss):
Basic	$	0.33		$	0.17	$	0.08	$	(2.61	)	$	0.07
Diluted	$	0.33		$	0.17	$	0.08	$	(2.61	)	$	0.07
Average common shares outstanding:
Basic		9,341,291			9,287,196		9,273,666		9,249,184			9,223,445
Diluted		9,341,533			9,287,196		9,273,666		9,249,184			9,233,060
Cash dividends declared	$	0.00		$	0.00	$	0.00	$	0.08		$	0.08

Riverview Financial Corporation

Details of Net Interest and Net Interest Margin

(In thousands, fully taxable equivalent basis)


Three months ended	Mar 31			Dec 31			Sep 30			Jun 30			Mar 31
	2021			2020			2020			2020			2020
Net interest income:
Interest income
Loans, net:
Taxable	$	10,348		$	11,403		$	11,265		$	10,602		$	9,782
Tax-exempt		223			227			282			299			310
Total loans, net		10,571			11,630			11,547			10,901			10,092
Investments:
Taxable		494			411			360			396			535
Tax-exempt		192			143			90			86			47
Total investments		686			554			450			482			582
Interest on interest-bearing balances in other banks		9			8			11			12			89
Total interest income		11,266			12,192			12,008			11,395			10,763
Interest expense:
Deposits		923			1,035			1,200			1,395			1,789
Short-term borrowings											23			5
Long-term debt		646			684			304			225			123
Total interest expense		1,569			1,719			1,504			1,643			1,917
Net interest income	$	9,697		$	10,473		$	10,504		$	9,752		$	8,846

Yields on earning assets:
Loans, net:
Taxable		3.83	%		4.00	%		3.95	%		4.10	%		4.69	%
Tax-exempt		3.36	%		3.29	%		3.57	%		3.46	%		3.50	%
Total loans, net		3.82	%		3.98	%		3.94	%		4.08	%		4.64	%
Investments:
Taxable		2.19	%		2.04	%		2.17	%		2.74	%		2.78	%
Tax-exempt		1.88	%		2.98	%		3.31	%		4.10	%		4.08	%
Total investments		2.09	%		2.22	%		2.33	%		2.91	%		2.85	%
Interest-bearing balances with banks		0.10	%		0.09	%		0.11	%		0.10	%		1.17	%
Federal funds sold
Total earning assets		3.54	%		3.74	%		3.73	%		3.85	%		4.39	%
Costs of interest-bearing liabilities:
Deposits		0.43	%		0.49	%		0.56	%		0.67	%		0.90	%
Short-term borrowings											0.33	%		2.03	%
Long-term debt		1.25	%		1.15	%		0.56	%		0.74	%		4.19	%
Total interest-bearing liabilities		0.59	%		0.63	%		0.56	%		0.67	%		0.95	%
Net interest spread		2.95	%		3.11	%		3.17	%		3.18	%		3.44	%
Net interest margin		3.04	%		3.21	%		3.26	%		3.29	%		3.60	%

Riverview Financial Corporation

Consolidated Balance Sheets

(In thousands, except per share data)


	Mar 31			Dec 31			Sep 30			Jun 30			Mar 31
At period end	2021			2020			2020			2020			2020
Assets:
Cash and due from banks	$	9,496		$	13,511		$	10,646		$	10,195		$	12,128
Interest-bearing balances in other banks		53,668			36,270			21,312			33,033			61,107
Federal funds sold
Investment securities available-for-sale		155,863			103,695			98,846			74,134			68,402
Loans held for sale		2,502			4,338			4,547			4,252			272
Loans, net		1,091,824			1,139,239			1,163,442			1,165,453			887,449
Less: allowance for loan losses		12,140			12,200			11,624			9,736			8,251
Net loans		1,079,684			1,127,039			1,151,818			1,155,717			879,198
Premises and equipment, net		17,991			18,147			18,419			18,668			18,875
Accrued interest receivable		4,189			4,216			3,218			1,826			2,589
Goodwill														24,754
Other intangible assets, net		1,786			1,918			2,227			2,397			2,566
Other assets		49,661			48,420			45,739			46,578			47,152
Total assets	$	1,374,840		$	1,357,554		$	1,356,772		$	1,346,800		$	1,117,043
Liabilities:
Deposits:
Noninterest-bearing	$	197,360		$	173,600		$	178,168		$	173,567		$	148,633
Interest-bearing		883,568			841,860			853,145			849,586			809,870
Total deposits		1,080,928			1,015,460			1,031,313			1,023,153			958,503
Short-term borrowings
Long-term debt		180,644			228,765			217,031			217,010			26,992
Accrued interest payable		1,347			1,038			591			457			424
Other liabilities		13,298			14,859			12,413			11,728			12,683
Total liabilities		1,276,217			1,260,122			1,261,348			1,252,348			998,602
Stockholders’ equity:
Common stock		102,861			102,662			102,672			102,552			102,386
Capital surplus		292			292			190			161			134
Retained earnings (accumulated deficit)		(3,397	)		(6,457	)		(8,040	)		(8,735	)		16,081
Accumulated other comprehensive income (loss)		(1,133	)		935			602			474			(160	)
Total stockholders’ equity		98,623			97,432			95,424			94,452			118,441
Total liabilities and stockholders’ equity	$	1,374,840		$	1,357,554		$	1,356,772		$	1,346,800		$	1,117,043

Riverview Financial Corporation

Consolidated Balance Sheets

(In thousands except per share data)


	Mar 31		Dec 31		Sep 30		Jun 30		Mar 31
Average quarterly balances	2021		2020		2020		2020		2020
Assets:
Loans, net:
Taxable	$	1,095,594	$	1,134,149	$	1,134,625	$	1,041,161	$	838,825
Tax-exempt		26,952		27,425		31,451		34,723		35,595
Total loans, net		1,122,546		1,161,574		1,166,076		1,075,884		874,420
Investments:
Taxable		91,549		79,996		66,049		58,230		77,400
Tax-exempt		41,443		19,102		10,812		8,442		4,628
Total investments		132,992		99,098		76,861		66,672		82,028
Interest-bearing balances with banks		36,101		35,381		38,334		48,174		30,490
Federal funds sold
Total earning assets		1,291,639		1,296,053		1,281,271		1,190,730		986,938
Other assets		72,586		70,815		73,079		102,097		98,407
Total assets	$	1,364,225	$	1,366,868	$	1,354,350	$	1,292,827	$	1,085,345

Liabilities and stockholders’ equity:
Deposits:
Noninterest-bearing	$	176,895	$	173,629	$	175,402	$	171,500	$	144,630
Interest-bearing		863,765		847,124		853,782		837,512		795,084
Total deposits		1,040,660		1,020,753		1,029,184		1,009,012		939,714
Short-term borrowings								28,417		989
Long-term debt		209,781		236,043		217,021		122,875		11,817
Other liabilities		14,861		13,389		12,135		13,062		13,668
Total liabilities		1,265,302		1,270,185		1,258,340		1,173,366		966,188
Stockholders’ equity		98,923		96,683		96,010		119,461		119,157
Total liabilities and stockholders’ equity	$	1,364,225	$	1,366,868	$	1,354,350	$	1,292,827	$	1,085,345

Riverview Financial Corporation

Asset Quality Data

(In thousands)


	Mar 31		Dec 31		Sep 30		Jun 30		Mar 31
	2021		2020		2020		2020		2020
At quarter end:
Nonperforming assets:
Nonaccrual loans	$	2,828	$	1,421	$	3,225	$	3,241	$	2,048
Accruing restructured loans		9,939		9,963		9,648		9,592		2,646
Accruing loans past due 90 days or more		165		156		108		183		691
Foreclosed assets		219		422		25		363		346
Total nonperforming assets	$	13,151	$	11,962	$	13,006	$	13,379	$	5,731

Three months ended:
Allowance for loan losses:
Beginning balance	$	12,200	$	11,624	$	9,736	$	8,251	$	7,516
Charge-offs		94		100		42		574		1,123
Recoveries		34		50		86		47		58
Provision for loan losses				626		1,844		2,012		1,800
Ending balance	$	12,140	$	12,200	$	11,624	$	9,736	$	8,251

Riverview Financial Corporation

Reconciliation of Non-GAAP Financial Measures

(In thousands, except per share data)


	Mar 31			Dec 31			Sep 30			Jun 30			Mar 31
Three months ended:	2021			2020			2020			2020			2020
Core net income (loss) per common share:
Net income (loss)	$	3,060		$	1,583		$	695		$	(24,122	)	$	633
Adjustments:
Less: Gain (loss) on sale of investment securities, net of tax		194												644
Add: Goodwill impairment											24,581
Net income (loss) – Core	$	2,866		$	1,583		$	695		$	459		$	(11	)

Average common shares outstanding		9,341,291			9,287,196			9,273,666			9,249,184			9,223,445
Core net income per common share	$	0.31		$	0.17		$	0.07		$	0.05		$	0.00

Tangible book value:
Total stockholders’ equity	$	98,623		$	97,432		$	95,424		$	94,452		$	118,441
Less: Goodwill														24,754
Less: Other intangible assets, net		1,786			1,918			2,227			2,397			2,566
Total tangible stockholders’ equity	$	96,837		$	95,514		$	93,197		$	92,055		$	91,121

Common shares outstanding		9,348,831			9,306,442			9,279,503			9,263,697			9,236,039

Tangible book value per share	$	10.36		$	10.26		$	10.04		$	9.94		$	9.87

Tangible stockholders’ equity to tangible assets:
Total stockholders’ equity	$	98,623		$	97,432		$	95,424		$	94,452		$	118,441
Less: Goodwill														24,754
Less: Other intangible assets, net		1,786			1,918			2,227			2,397			2,566
Total tangible stockholders’ equity	$	96,837		$	95,514		$	93,197		$	92,055		$	91,121

Total assets	$	1,374,840		$	1,357,554		$	1,356,772		$	1,346,800		$	1,117,043
Less: Goodwill														24,754
Less: Other intangible assets, net		1,786			1,918			2,227			2,397			2,566
Total tangible assets	$	1,373,054		$	1,355,636		$	1,354,545		$	1,344,403		$	1,089,723

Tangible stockholders’ equity to tangible assets		7.05	%		7.05	%		6.88	%		6.85	%		8.36	%

Core return on average stockholders’ equity:
Net income (loss) GAAP	$	3,060		$	1,583		$	695		$	(24,122	)	$	633
Adjustments:
Less: Gain (loss) on sale of investment securities, net of tax		194												644
Add: Goodwill impairment											24,581
Net income (loss) – Core	$	2,866		$	1,583		$	695		$	459		$	(11	)

Average stockholders’ equity	$	98,923		$	96,683		$	96,010		$	119,461		$	119,157
Core return on average stockholders’ equity		11.75	%		6.51	%		2.88	%		1.55	%		(0.04	)%

Return on average tangible equity:
Net income (loss) GAAP	$	3,060		$	1,583		$	695		$	(24,122	)	$	633

Average stockholders’ equity	$	98,923		$	96,683		$	96,010		$	119,461		$	119,157
Less: average intangibles		1,849			2,116			2,310			26,961			27,401
Average tangible stockholders’ equity	$	97,074		$	94,567		$	93,700		$	92,500		$	91,756

Return on average tangible stockholders’ equity		12.78	%		6.66	%		2.95	%		(104.88	)%		2.77	%

Riverview Financial Corporation

Reconciliation of Non-GAAP Financial Measures

(In thousands, except per share data)


	Mar 31			Dec 31			Sep 30			Jun 30			Mar 31
Three months ended:	2021			2020			2020			2020			2020
Core return on average tangible stockholders’ equity:
Net income (loss) GAAP	$	3,060		$	1,583		$	695		$	(24,122	)	$	633
Adjustments:
Less: Gain (loss) on sale of investment securities, net of tax		194												644
Add: Goodwill impairment											24,581
Net income (loss) – Core	$	2,866		$	1,583		$	695		$	459		$	(11	)

Average stockholders’ equity	$	98,923		$	96,683		$	96,010		$	119,461		$	119,157
Less: average intangibles		1,849			2,116			2,310			26,961			27,401
Average tangible stockholders’ equity	$	97,074		$	94,567		$	93,700		$	92,500		$	91,756

Core return on average tangible stockholders’ equity		11.97	%		6.66	%		2.95	%		2.00	%		(0.05	)%

Core return on average assets:
Net income (loss) GAAP	$	3,060		$	1,583		$	695		$	(24,122	)	$	633
Adjustments:
Less: Gain (loss) on sale of investment securities, net of tax		194												644
Add: Goodwill impairment											24,581
Net income (loss) – Core	$	2,866		$	1,583		$	695		$	459		$	(11	)

Average assets	$	1,364,225		$	1,366,868		$	1,354,350		$	1,292,827		$	1,085,345
Core return on average assets		0.85	%		0.46	%		0.20	%		0.14	%		0.00	%

Riverview Financial Corporation

Reconciliation of Non-GAAP Financial Measures

(In thousands, except per share data)


	Mar 31		Mar 31
	2021		2020
Three months ended:

Core net income per common share:
Net income	$	3,060	$	633
Adjustments:
Less: Gains (loss) on sale of investment securities, net of tax		194		644
Add: Goodwill impairment
Net income (loss) – core	$	2,866	$	(11	)

Average common shares outstanding		9,341,291		9,223,445

Core net income (loss) per common share	$	0.31	$	0.00

Riverview Financial (RIVE) 8-KReports First Quarter Financial Results for 2021