River Valley Bancorp (NASDAQ: RIVR), an Indiana corporation (the “Corporation”) and holding company for River Valley Financial Bank, based in Madison, Indiana announced today earnings for the third quarter ended September 30, 2011.
Due to continued downward pressure on real estate values and individuals’ economic problems, the Corporation provided a $1.4 million provision for loan losses, and recorded another $534,000 write down on real estate owned during the third quarter. The net effect was a loss of $207,145, or $(0.20) expressed as basic earnings (loss) per share, for the quarter ended September 30, 2011. Net income for the quarter ended September 30, 2010 was $291,475, or $0.13 expressed as basic earnings per share. For the current period ended September 30, 2011, recent appraisals indicated a substantive decline in collateral value on certain classified assets and property held by the Corporation as other real estate owned. For assets held in other real estate owned, a write down of values is accounted for through the income statement, and directly impacts other income. With the exception of those factors previously discussed, and a modest increase in operating expenses, most of which relates to expenses associated with property held for sale, other operating indicators, including interest margins, reflected improvement over the previous year quarter. The return on average assets for the three month period ended September 30, 2011 was -0.21% and the return on equity was -2.48%. Those respective ratios were 0.30% and 3.56% for the like period in 2010.
Net income for the nine-month period ended September 30, 2011 was $1,216,334, or $0.62 per basic share. This represents a decrease of $509,932 from the $1,726,266, or $0.96 per basic share, recorded for the same period ended September 30, 2010. As stated previously, this decrease is primarily attributable to additional provision expense and valuation determinations of real estate owned in the third quarter of 2011. The return on average assets for the nine-month period ended September 30, 2011 was 0.41% and the return on average equity was 4.95%. Those respective ratios were 0.58% and 7.19% for the like period in 2010.