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Riverview Bancorp, Inc. (Nasdaq:RVSB) (“Riverview” or the “Company”), the parent company of Riverview Community Bank (the “Bank”) today announced that it has increased its provision for loan losses an additional $3.2 million for its fourth fiscal quarter ended March 31, 2012. As a result, the Company’s net loss was $16.0 million, or $0.71 per share, for the quarter ended March 31, 2012, compared to a net loss of $16.6 million, or $0.74 per share in the preceding quarter and net income of $854,000, or $0.04 per share, in its fourth fiscal quarter a year ago. For the fiscal year, Riverview’s net loss was $31.7 million, or $1.42 per share, compared to net income of $4.3 million, or $0.24 per share, for fiscal year 2011.
“The increase in the provision for loan losses was necessary as a result of updated information received by the Bank on three commercial properties as well as the current regulatory guidance for these individual properties,” said Pat Sheaffer, Chairman and CEO. “This additional provision for loan losses increases the Bank’s reserves as we remain diligent in our efforts to reduce our non-performing assets.”
Riverview’s provision for loan losses totaled $17.5 million for the fourth quarter of fiscal year 2012, compared to $8.1 million in the preceding quarter and $500,000 in the fourth quarter of fiscal year 2011. The allowance for loan losses increased to $19.9 million at March 31, 2012, representing 2.91% of total loans and 45.11% of non-performing loans (NPLs). NPLs decreased to $44.2 million, or 6.45% of total loans at March 31, 2012, as a result of an additional charge-off of $867,000 on a nonperforming commercial real estate loan.
The additional provision for loan losses was primarily related to three individual properties. The first was a $2.7 million commercial real estate property located in Portland, Oregon. The second was a $992,000 commercial real estate loan to a related borrower located in Portland, Oregon. The Company increased its provision for loan losses $926,000 and charged-off a total of $1.9 million for these two properties. Both of these loans have continued to pay as agreed and have not missed any of their required payments. An additional provision of $600,000 was for a land development project located in southwest Washington. The Company also bolstered its general allowance by an additional $1.7 million.