[X]
|
ANNUAL
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
[
]
|
TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
Washington | 91-1838969 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer I.D. Number) | |
900 Washington St., Ste. 900,Vancouver, Washington | 98660 | |
(Address of principal executive offices) | (Zip Code) | |
Registrant's telephone number, including area code: | (360) 693-6650 | |
Securities registered pursuant to Section 12(b) of the Act: | ||
Title of Each Class | Name of Each Exchange on Which Registered | |
Common Stock, Par Value $.01 per share | Nasdaq Stock Market LLC | |
Securities registered pursuant to Section 12(g) of the Act: | None | |
Table of
Contents
|
|||
PART I
|
PAGE
|
||
Item
1.
|
Business
|
1
|
|
Item
1A.
|
Risk
Factors
|
32
|
|
Item
1B.
|
Unresolved
Staff Comments
|
40
|
|
Item
2.
|
Properties
|
40
|
|
Item
3.
|
Legal
Proceedings
|
40
|
|
Item
4.
|
Submission
of Matters to a Vote of Security Holders
|
41
|
|
PART II
|
|||
Item
5.
|
Market
of Registrant’s Common Equity, Related Stockholder Matters and Issuer
Purchases of Equity Securities
|
41
|
|
Item
6.
|
Selected
Financial Data
|
43
|
|
Item
7.
|
Management’s
Discussion and Analysis of Financial Condition and Results of
Operations
|
45
|
|
Item
7A.
|
Quantitative
and Qualitative Disclosures about Market Risk
|
58
|
|
Item
8.
|
Financial
Statements and Supplementary Data
|
61
|
|
Item
9.
|
Changes
in and Disagreements with Accountants on Accounting and Financial
Disclosure
|
92
|
|
Item
9A.
|
Controls
and Procedures
|
92
|
|
Item
9B.
|
Other
Information
|
95
|
|
PART III
|
|||
Item
10.
|
Directors,
Executive Officers and Corporate Governance
|
95
|
|
Item
11.
|
Executive
Compensation
|
95
|
|
Item
12.
|
Security
Ownership of Certain Beneficial Owners and Management and Related
Stockholders
|
95
|
|
Item
13.
|
Certain
Relationships and Related Transactions, and Director
Independence
|
96
|
|
Item
14.
|
Principal
Accountant Fees and Services
|
96
|
|
PART IV
|
|||
Item
15.
|
Exhibits
and Financial Statement Schedules
|
97
|
|
Signatures
|
98 | ||
|
Index
to exhibits
|
99
|
|
|
|
At
March 31,
|
|||||||||||||||||||||||||||||
2009
|
2008
|
2007
|
2006
|
2005
|
|||||||||||||||||||||||||
Amount
|
Percent
|
Amount
|
Percent
|
Amount
|
Percent
|
Amount
|
Percent
|
Amount
|
Percent
|
||||||||||||||||||||
(Dollars
in thousands)
|
|||||||||||||||||||||||||||||
Commercial
and construction:
|
|||||||||||||||||||||||||||||
Commercial
|
$
|
127,150
|
15.87
|
%
|
$
|
109,585
|
14.28
|
%
|
$
|
91,174
|
13.18
|
%
|
$
|
90,083
|
14.29
|
%
|
$
|
78,280
|
18.04
|
%
|
|||||||||
Other
real estate mortgage
|
447,652
|
55.88
|
429,422
|
55.97
|
360,930
|
52.19
|
329,631
|
52.31
|
220,813
|
50.90
|
|||||||||||||||||||
Real
estate construction
|
139,476
|
17.41
|
148,631
|
19.37
|
166,073
|
24.01
|
137,598
|
21.83
|
58,699
|
13.53
|
|||||||||||||||||||
Total
commercial and construction
|
714,278
|
89.16
|
687,638
|
89.62
|
618,177
|
89.38
|
557,312
|
88.43
|
357,792
|
82.47
|
|||||||||||||||||||
Consumer:
|
|||||||||||||||||||||||||||||
Real
estate one-to-four family
|
83,762
|
10.46
|
75,922
|
9.90
|
69,808
|
10.10
|
64,026
|
10.16
|
68,945
|
15.89
|
|||||||||||||||||||
Other
installment
|
3,051
|
0.38
|
3,665
|
0.48
|
3,619
|
0.52
|
8,899
|
1.41
|
7,107
|
1.64
|
|||||||||||||||||||
Total
consumer loans
|
86,813
|
10.84
|
79,587
|
10.38
|
73,427
|
10.62
|
72,925
|
11.57
|
76,052
|
17.53
|
|||||||||||||||||||
Total
loans
|
801,091
|
100.00
|
%
|
767,225
|
100.00
|
%
|
691,604
|
100.00
|
%
|
630,237
|
100.00
|
%
|
433,844
|
100.00
|
%
|
||||||||||||||
Less:
|
|||||||||||||||||||||||||||||
Allowance
for loan losses
|
16,974
|
10,687
|
8,653
|
7,221
|
4,395
|
||||||||||||||||||||||||
Total
loans receivable, net
|
$
|
784,117
|
$
|
756,538
|
$
|
682,951
|
$
|
623,016
|
$
|
429,449
|
|||||||||||||||||||
Commercial
|
Other
Real
Estate Mortgage
|
Real
Estate
Construction
|
Commercial
& Construction
Total
|
||||||||
March
31, 2009
|
(Dollars
in thousands)
|
||||||||||
Commercial
|
$
|
127,150
|
$
|
-
|
$
|
-
|
$
|
127,150
|
|||
Commercial
construction
|
-
|
-
|
65,459
|
65,459
|
|||||||
Office
buildings
|
-
|
90,621
|
-
|
90,621
|
|||||||
Warehouse/industrial
|
-
|
40,214
|
-
|
40,214
|
|||||||
Retail/shopping
centers/strip malls
|
-
|
81,233
|
-
|
81,233
|
|||||||
Assisted living facilities
|
-
|
26,743
|
-
|
26,743
|
|||||||
Single
purpose facilities
|
-
|
88,574
|
-
|
88,574
|
|||||||
Land
|
-
|
91,873
|
-
|
91,873
|
|||||||
Multi-family
|
-
|
28,394
|
-
|
28,394
|
|||||||
One-to-four
family construction
|
-
|
-
|
74,017
|
74,017
|
|||||||
Total
|
$
|
127,150
|
$
|
447,652
|
$
|
139,476
|
$
|
714,278
|
Commercial
|
Other
Real
Estate Mortgage
|
Real
Estate
Construction
|
Commercial
& Construction
Total
|
||||||||
March
31, 2008
|
(Dollars
in thousands)
|
||||||||||
Commercial
|
$
|
109,585
|
$
|
-
|
$
|
-
|
$
|
109,585
|
|||
Commercial
construction
|
-
|
-
|
55,277
|
55,277
|
|||||||
Office
buildings
|
-
|
88,106
|
-
|
88,106
|
|||||||
Warehouse/industrial
|
-
|
39,903
|
-
|
39,903
|
|||||||
Retail/shopping
centers/strip malls
|
-
|
70,510
|
-
|
70,510
|
|||||||
Assisted living facilities
|
-
|
28,072
|
-
|
28,072
|
|||||||
Single
purpose facilities
|
-
|
65,756
|
-
|
65,756
|
|||||||
Land
|
-
|
108,030
|
-
|
108,030
|
|||||||
Multi-family
|
-
|
29,045
|
-
|
29,045
|
|||||||
One-to-four
family construction
|
-
|
-
|
93,354
|
93,354
|
|||||||
Total
|
$
|
109,585
|
$
|
429,422
|
$
|
148,631
|
$
|
687,638
|
At
March 31,
|
|||||||||||||
2009
|
2008
|
||||||||||||
Amount
(1)
|
Percent
|
Amount
(1)
|
Percent
|
||||||||||
(Dollars
in thousands)
|
|||||||||||||
Speculative
construction
|
$
|
60,494
|
37.45
|
%
|
$
|
91,704
|
44.57
|
%
|
|||||
Commercial/multi-family
construction
|
77,842
|
48.19
|
92,140
|
44.79
|
|||||||||
Custom/presold
construction
|
11,337
|
7.02
|
11,661
|
5.67
|
|||||||||
Construction/permanent
|
11,864
|
7.34
|
10,235
|
4.97
|
|||||||||
Total
|
$
|
161,537
|
100.00
|
%
|
$
|
205,740
|
100.00
|
%
|
Northwest
Oregon
|
Other
Oregon
|
Southwest
Washington
|
Other
Washington
|
Other
|
Total
|
|||||||||||||
March
31, 2009
|
(In
thousands)
|
|||||||||||||||||
Land
development
|
$
|
6,659
|
$
|
9,130
|
$
|
66,776
|
$
|
3,540
|
$
|
5,768
|
$
|
91,873
|
||||||
Speculative
construction
|
14,706
|
15,730
|
24,974
|
2,343
|
-
|
57,753
|
||||||||||||
Total
spec and land construction
|
$
|
21,365
|
$
|
24,860
|
$
|
91,750
|
$
|
5,883
|
$
|
5,768
|
$
|
149,626
|
|
Within
1
Year
|
1
– 3
Years
|
After
3 – 5
Years
|
After
5 – 10
Years
|
Beyond
10 Years
|
Total
|
|||||||||||
Commercial
and construction:
|
(Dollars
in thousands)
|
||||||||||||||||
Commercial
|
|||||||||||||||||
Adjustable
rate
|
$
|
69,579
|
$
|
6,171
|
$
|
4,947
|
$
|
16,716
|
$
|
-
|
$
|
97,413
|
|||||
Fixed
rate
|
2,624
|
14,891
|
11,222
|
1,000
|
-
|
29,737
|
|||||||||||
Other real estate mortgage | |||||||||||||||||
Adjustable
rate
|
89,484
|
12,255
|
23,382
|
222,845
|
20,015
|
367,981
|
|||||||||||
Fixed
rate
|
6,356
|
21,301
|
22,960
|
27,633
|
1,421
|
79,671
|
|||||||||||
Real
estate construction
|
|||||||||||||||||
Adjustable
rate
|
82,825
|
99
|
475
|
18,418
|
4,087
|
105,904
|
|||||||||||
Fixed
rate
|
23,742
|
3,829
|
2,323
|
3,678
|
-
|
33,572
|
|||||||||||
Total
commercial & construction
|
274,610
|
58,546
|
65,309
|
290,290
|
25,523
|
714,278
|
|||||||||||
Consumer:
|
|||||||||||||||||
Real
estate one-to-four family
|
|||||||||||||||||
Adjustable
rate
|
355
|
217
|
210
|
3,005
|
43,811
|
47,598
|
|||||||||||
Fixed
rate
|
1,902
|
11,071
|
5,211
|
720
|
17,260
|
36,164
|
|||||||||||
Other
installment
|
|||||||||||||||||
Adjustable
rate
|
44
|
-
|
-
|
621
|
-
|
665
|
|||||||||||
Fixed
rate
|
494
|
555
|
973
|
267
|
97
|
2,386
|
|||||||||||
Total
consumer
|
2,795
|
11,843
|
6,394
|
4,613
|
61,168
|
86,813
|
|||||||||||
Total
net loans
|
$
|
277,405
|
$
|
70,389
|
$
|
71,703
|
$
|
294,903
|
$
|
86,691
|
$
|
801,091
|
|||||
At
March 31,
|
|||||||||||||||
2009
|
2008
|
2007
|
2006
|
2005
|
|||||||||||
(Dollars
in thousands)
|
|||||||||||||||
Loans
accounted for on a non-accrual basis:
|
|||||||||||||||
Commercial
|
$
|
6,018
|
$
|
1,164
|
$
|
-
|
$
|
-
|
$
|
97
|
|||||
Other
real estate mortgage
|
7,316
|
3,892
|
226
|
415
|
198
|
||||||||||
Real
estate construction
|
12,720
|
2,124
|
-
|
-
|
-
|
||||||||||
Real
estate one-to-four family
|
1,329
|
382
|
-
|
-
|
-
|
||||||||||
Consumer
|
-
|
-
|
-
|
-
|
161
|
||||||||||
Total
|
27,383
|
7,562
|
226
|
415
|
456
|
||||||||||
Accruing
loans which are contractually
past
due 90 days or more
|
187
|
115
|
-
|
-
|
-
|
||||||||||
Total
nonperforming loans
|
27,570
|
7,677
|
226
|
415
|
456
|
||||||||||
REO
|
14,171
|
494
|
-
|
-
|
270
|
||||||||||
Total
nonperforming assets
|
$
|
41,741
|
$
|
8,171
|
$
|
226
|
$
|
415
|
$
|
726
|
|||||
Total
nonperforming loans to net loans
|
3.44
|
%
|
1.00
|
%
|
0.03
|
%
|
0.07
|
%
|
0.10
|
%
|
|||||
Total
nonperforming loans to total assets
|
3.02
|
0.87
|
0.03
|
0.05
|
0.08
|
||||||||||
Total
nonperforming assets to total assets
|
4.57
|
0.92
|
0.03
|
0.05
|
0.13
|
Northwest
Oregon
|
Other
Oregon
|
Southwest
Washington
|
Other
Washington
|
Other
|
Total
|
||||||||||||
March
31, 2009
|
(Dollars
in thousands)
|
||||||||||||||||
Commercial
|
$
|
50
|
$
|
3,813
|
$
|
2,155
|
$
|
-
|
$
|
-
|
$
|
6,018
|
|||||
Commercial
real estate
|
-
|
-
|
-
|
-
|
-
|
-
|
|||||||||||
Land
|
-
|
-
|
4,300
|
115
|
1,400
|
5,815
|
|||||||||||
Multi-family
|
1,341
|
-
|
160
|
-
|
-
|
1,501
|
|||||||||||
Commercial
construction
|
-
|
-
|
-
|
75
|
-
|
75
|
|||||||||||
One-to-four family construction
|
425
|
11,428
|
740
|
239
|
-
|
12,832
|
|||||||||||
Real
estate one-to-four family
|
-
|
152
|
1,104
|
73
|
-
|
1,329
|
|||||||||||
Total nonperforming loans
|
1,816
|
15,393
|
8,459
|
502
|
1,400
|
27,570
|
|||||||||||
REO
|
422
|
2,267
|
6,321
|
5,161
|
-
|
14,171
|
|||||||||||
Total
nonperforming assets
|
$
|
2,238
|
$
|
17,660
|
$
|
14,780
|
$
|
5,663
|
$
|
1,400
|
$
|
41,741
|
At
or For the Year
|
||||||
Ended
March 31,
|
||||||
2009
|
2008
|
|||||
(In
thousands)
|
||||||
Classified
loans
|
$
|
37,250
|
$
|
14,344
|
||
General
loss allowances
|
12,659
|
9,785
|
||||
Specific
loss allowances
|
4,315
|
902
|
||||
Charge-offs
|
9,890
|
905
|
Year
Ended March 31,
|
|||||||||||||||
2009
|
2008
|
2007
|
2006
|
2005
|
|||||||||||
(Dollars
in thousands)
|
|||||||||||||||
Balance
at beginning of period
|
$
|
10,687
|
$
|
8,653
|
$
|
7,221
|
$
|
4,395
|
$
|
4,481
|
|||||
Provision
for loan losses
|
16,150
|
2,900
|
1,425
|
1,500
|
410
|
||||||||||
Recoveries:
|
|||||||||||||||
Commercial
and construction
|
|||||||||||||||
Commercial
|
25
|
10
|
165
|
87
|
156
|
||||||||||
Other
real estate mortgage
|
-
|
12
|
-
|
-
|
-
|
||||||||||
Total
commercial and construction
|
25
|
22
|
165
|
87
|
156
|
||||||||||
Consumer
|
|||||||||||||||
Residential
real estate
|
-
|
-
|
-
|
48
|
-
|
||||||||||
Other
installment
|
2
|
17
|
28
|
14
|
17
|
||||||||||
Total
consumer
|
2
|
17
|
28
|
62
|
17
|
||||||||||
Total
recoveries
|
27
|
39
|
193
|
149
|
173
|
||||||||||
Charge-offs:
|
|||||||||||||||
Commercial
and construction
|
|||||||||||||||
Commercial
|
1,311
|
794
|
172
|
577
|
490
|
||||||||||
Other
real estate mortgage
|
5,913
|
42
|
-
|
-
|
-
|
||||||||||
Real
estate construction
|
2,073
|
-
|
-
|
-
|
-
|
||||||||||
Total
commercial and construction
|
9,297
|
836
|
172
|
577
|
490
|
||||||||||
Consumer | |||||||||||||||
Residential real estate
|
361
|
48
|
-
|
41
|
149
|
||||||||||
Other installment
|
232
|
21
|
14
|
93
|
30
|
||||||||||
Total
consumer
|
593
|
69
|
14
|
134
|
179
|
||||||||||
Total
charge-offs
|
9,890
|
905
|
186
|
711
|
669
|
||||||||||
Net
charge-offs (recoveries)
|
9,863
|
866
|
(7
|
)
|
562
|
496
|
|||||||||
Allowance
acquired from American Pacific Bank
|
-
|
-
|
-
|
1,888
|
-
|
||||||||||
Balance
at end of period
|
$
|
16,974
|
$
|
10,687
|
$
|
8,653
|
$
|
7,221
|
$
|
4,395
|
|||||
Ratio
of allowance to total loans
outstanding
at end of period
|
2.12
|
%
|
1.39
|
%
|
1.25
|
%
|
1.15
|
%
|
1.01
|
%
|
|||||
Ratio
of net charge-offs to average net loans outstanding during
period
|
1.24
|
0.12
|
-
|
0.10
|
0.13
|
||||||||||
Ratio
of allowance to total nonperforming loans
|
62
|
139
|
3,829
|
1,740
|
964
|
At
March 31,
|
|||||||||||||||||||||||||||||||
2009
|
2008
|
2007
|
2006
|
2005
|
|||||||||||||||||||||||||||
Amount
|
Loan
Category as a Percent
of
Total Loans
|
Amount
|
Loan
Category as a Percent of Total Loans
|
Amount
|
Loan
Category as a Percent of Total Loans
|
Amount
|
Loan
Category as a Percent of Total Loans
|
Amount
|
Loan
Category as a Percent
of
Total Loans
|
||||||||||||||||||||||
(Dollars
in thousands)
|
|||||||||||||||||||||||||||||||
Commercial
and construction:
|
|||||||||||||||||||||||||||||||
Commercial
|
$
|
2,668
|
15.87
|
%
|
$
|
1,339
|
14.28
|
%
|
$
|
1,553
|
13.18
|
%
|
$
|
1,549
|
14.29
|
%
|
$
|
1,834
|
18.02
|
%
|
|||||||||||
Other
real estate mortgage
|
6,475
|
55.88
|
5,415
|
55.97
|
4,066
|
52.19
|
3,553
|
52.30
|
1,863
|
50.84
|
|||||||||||||||||||||
Real
estate construction
|
4,592
|
17.41
|
2,092
|
19.37
|
2,060
|
24.01
|
1,365
|
21.83
|
276
|
13.51
|
|||||||||||||||||||||
Consumer:
|
|||||||||||||||||||||||||||||||
Real
estate one-to-four family
|
1,148
|
10.46
|
669
|
9.90
|
333
|
10.10
|
292
|
10.17
|
278
|
15.99
|
|||||||||||||||||||||
Other
installment
|
61
|
0.38
|
64
|
0.48
|
63
|
0.52
|
168
|
1.41
|
144
|
1.64
|
|||||||||||||||||||||
Unallocated
|
2,030
|
-
|
1,108
|
-
|
578
|
-
|
294
|
-
|
-
|
-
|
|||||||||||||||||||||
Total
allowance for loan loss
|
$
|
16,974
|
100.00
|
%
|
$
|
10,687
|
100.00
|
%
|
$
|
8,653
|
100.00
|
%
|
$
|
7,221
|
100.00
|
%
|
$
|
4,395
|
100.00
|
%
|
|||||||||||
At
March 31,
|
|||||||||||||||||
2009
|
2008
|
2007
|
|||||||||||||||
Carrying
Value
|
Percent
of
Portfolio
|
Carrying
Value
|
Percent
of
Portfolio
|
Carrying
Value
|
Percent
of
Portfolio
|
||||||||||||
(Dollars
in thousands)
|
|||||||||||||||||
Held
to maturity (at amortized cost):
|
|||||||||||||||||
REMICs
|
$
|
348
|
2.55
|
%
|
$
|
624
|
4.55
|
%
|
$
|
923
|
3.40
|
%
|
|||||
FHLMC
mortgage-backed securities
|
94
|
0.69
|
104
|
0.76
|
116
|
0.43
|
|||||||||||
FNMA
mortgage-backed securities
|
128
|
0.94
|
157
|
1.15
|
193
|
0.71
|
|||||||||||
Municipal
securities
|
529
|
3.87
|
-
|
-
|
-
|
-
|
|||||||||||
1,099
|
8.05
|
885
|
6.46
|
1,232
|
4.54
|
||||||||||||
Available
for sale (at fair value):
|
|||||||||||||||||
Agency
securities
|
5,054
|
37.01
|
-
|
-
|
10,740
|
39.57
|
|||||||||||
REMICs
|
685
|
5.02
|
858
|
6.25
|
1,083
|
4.00
|
|||||||||||
FHLMC
mortgage-backed securities
|
3,310
|
24.24
|
4,390
|
32.02
|
5,439
|
20.04
|
|||||||||||
FNMA
mortgage-backed securities
|
71
|
0.52
|
90
|
0.66
|
118
|
0.43
|
|||||||||||
Municipal
securities
|
2,292
|
16.78
|
2,875
|
20.97
|
3,508
|
12.93
|
|||||||||||
Trust
preferred securities
|
1,144
|
8.38
|
4,612
|
33.64
|
5,019
|
18.49
|
|||||||||||
12,556
|
91.95
|
12,825
|
93.54
|
25,907
|
95.46
|
||||||||||||
Total
investment securities
|
$
|
13,655
|
100.00
|
%
|
$
|
13,710
|
100.00
|
%
|
$
|
27,139
|
100.00
|
%
|
Less
Than One Year
|
One
to Five Years
|
More
Than Five to Ten Years
|
More
Than
Ten
Years
|
||||||||||||||||||||
Amount
|
Weighted
Average
Yield
(1)
|
Amount
|
Weighted
Average
Yield
(1)
|
Amount
|
Weighted
Average
Yield
(1)
|
Amount
|
Weighted
Average
Yield
(1)
|
||||||||||||||||
(Dollars
in thousands)
|
|||||||||||||||||||||||
Municipal
securities
|
$
|
540
|
4.30
|
%
|
$
|
-
|
-
|
%
|
$
|
1,163
|
4.90
|
%
|
$
|
1,118
|
4.38
|
%
|
|||||||
Agency
securities
|
-
|
-
|
5,054
|
5.00
|
-
|
-
|
-
|
-
|
|||||||||||||||
REMICs
|
-
|
-
|
-
|
-
|
261
|
5.01
|
772
|
1.64
|
|||||||||||||||
FHLMC
mortgage-backed securities
|
-
|
-
|
1,483
|
4.02
|
1,828
|
4.00
|
93
|
4.75
|
|||||||||||||||
FNMA
mortgage-backed securities
|
-
|
-
|
4
|
12.19
|
53
|
6.02
|
142
|
4.54
|
|||||||||||||||
Trust
preferred securities
|
-
|
-
|
-
|
-
|
-
|
-
|
1,144
|
4.25
|
|||||||||||||||
Total
|
$
|
540
|
4.30
|
%
|
$
|
6,541
|
4.78
|
%
|
$
|
3,305
|
4.43
|
%
|
$
|
3,269
|
3.70
|
%
|
(1)
|
For
available for sale securities carried at fair value, the weighted average
yield is computed using amortized
cost
without a tax equivalent adjustment for tax-exempt
obligations.
|
Year
Ended March 31,
|
||||||||||||||||||||
2009
|
2008
|
2007
|
||||||||||||||||||
Average
Balance
|
Average
Rate
|
Average
Balance
|
Average
Rate
|
Average
Balance
|
Average
Rate
|
|||||||||||||||
(Dollars
in thousands)
|
||||||||||||||||||||
Non-interest-bearing
demand
|
$
|
81,566
|
0.00
|
%
|
$
|
82,776
|
0.00
|
%
|
$
|
91,888
|
0.00
|
%
|
||||||||
Interest
checking
|
86,986
|
1.13
|
129,552
|
3.02
|
139,600
|
3.17
|
||||||||||||||
Regular
savings accounts
|
27,138
|
0.55
|
27,403
|
0.55
|
32,591
|
0.55
|
||||||||||||||
Money
market accounts
|
173,853
|
2.19
|
219,528
|
4.05
|
161,590
|
4.31
|
||||||||||||||
Certificates
of deposit
|
282,055
|
3.66
|
197,049
|
4.67
|
202,506
|
4.41
|
||||||||||||||
Total
|
$
|
651,598
|
2.34
|
%
|
$
|
656,308
|
3.37
|
%
|
$
|
628,175
|
3.26
|
%
|
Maturity Period
|
Amount
|
Weighted
Average
Rate
|
|||
(Dollars
in thousands)
|
|||||
Three
months or less
|
$
|
58,088
|
2.52
|
%
|
|
Over
three through six months
|
24,624
|
3.30
|
|||
Over
six through 12 months
|
38,566
|
3.36
|
|||
Over
12 Months
|
21,219
|
3.60
|
|||
Total
|
$
|
142,497
|
3.04
|
%
|
At
March 31,
|
|||||||||||
2009
|
2008
|
2007
|
|||||||||
(Dollars
in thousands)
|
|||||||||||
FHLB
advances outstanding
|
$
|
37,850
|
$
|
92,850
|
$
|
35,050
|
|||||
Weighted
average rate on FHLB advances
|
2.02
|
%
|
3.35
|
%
|
5.66
|
%
|
|||||
FRB
advances outstanding
|
$
|
85,000
|
$
|
-
|
$
|
-
|
|||||
Weighted
average rate on FRB advances
|
0.25
|
%
|
-
|
-
|
Year
Ended March 31,
|
|||||||||||
2009
|
2008
|
2007
|
|||||||||
(Dollars
in thousands)
|
|||||||||||
Maximum
amounts of FHLB advances outstanding at any month end
|
$
|
144,860
|
$
|
122,200
|
$
|
90,000
|
|||||
Average
FHLB advances outstanding
|
115,303
|
47,769
|
68,300
|
||||||||
Weighted
average rate on FHLB advances
|
1.99
|
%
|
4.32
|
%
|
5.26
|
%
|
|||||
Maximum
amounts of FRB advances outstanding at any month end
|
$
|
85,000
|
$
|
-
|
$
|
-
|
|||||
Average
FRB advances outstanding
|
10,000
|
-
|
-
|
||||||||
Weighted
average rate on FRB advances
|
0.25
|
%
|
-
|
-
|
Name
|
Age
(1
)
|
Position
|
||
Patrick
Sheaffer
|
69
|
Chairman
of the Board and Chief Executive Officer
|
||
Ronald
A. Wysaske
|
56
|
President
and Chief Operating Officer
|
||
David
A. Dahlstrom
|
58
|
Executive
Vice President and Chief Credit Officer
|
||
Kevin
J. Lycklama
|
31
|
Senior
Vice President and Chief Financial Officer
|
||
John
A. Karas
|
60
|
Executive
Vice President
|
||
James
D. Baldovin
|
50
|
Executive
Vice President Retail Banking
|
•
|
the
development of a public/private investment fund essentially structured as
a government sponsored enterprise with the mission to purchase troubled
assets from banks with an initial capitalization from government
funds;
|
•
|
the
Capital Assistance Program under which the Treasury will purchase
additional preferred stock available only for banks that have undergone a
new stress test given by their
regulator;
|
•
|
an
expansion of the Federal Reserve’s term asset-backed liquidity facility to
support the purchase of up to $1 trillion in AAA–rated asset backed
securities backed by consumer, student, and small business loans, and
possible other types of loans; and
|
•
|
the
establishment of a mortgage loan modification program with $50 billion in
federal funds further detailed in the
HASP.
|
|
•
|
Total
reported loans for construction, land development and other land represent
100% or more of the bank’s capital;
or
|
|
•
|
Total
commercial real estate loans (as defined in the guidance) represent 300%
or more of the bank’s total capital and the outstanding balance of the
bank’s commercial real estate loan portfolio has increased 50% or more
during the prior 36 months.
|
•
|
We
potentially face increased regulation of our industry. Compliance with
such regulation may increase our costs and limit our ability to pursue
business opportunities.
|
•
|
Our
ability to assess the creditworthiness of our customers may be impaired if
the models and approaches we use to select, manage and underwrite our
customers become less predictive of future
behaviors.
|
•
|
The
process we use to estimate losses inherent in our loan and investment
portfolios requires difficult, subjective and complex judgments, including
forecasts of economic conditions and how these economic conditions might
impair the ability of our borrowers and trust preferred securities issuers
to repay their debts. The level of uncertainty concerning
economic conditions may adversely affect the accuracy of our estimates
which may, in turn, impact the reliability of the
process.
|
•
|
Competition
in our industry could intensify as a result of the increasing
consolidation of financial services companies in connection with current
market conditions.
|
•
|
We
may be required to pay significantly higher FDIC premiums because market
developments have significantly depleted the insurance fund of the FDIC
and reduced the ratio of reserves to insured
deposits.
|
Fiscal
Year Ended March 31, 2009
|
High
|
Low
|
Cash
Dividends
Declared
|
|||||
Quarter
ended March 31, 2009
|
$
|
4.35
|
$
|
1.60
|
$
|
0.000
|
||
Quarter
ended December 31, 2008
|
6.10
|
2.25
|
0.000
|
|||||
Quarter
ended September 30, 2008
|
7.38
|
4.52
|
0.045
|
|||||
Quarter
ended June 30, 2008
|
9.79
|
7.42
|
0.090
|
Fiscal
Year Ended March 31, 2008
|
High
|
Low
|
Cash
Dividends
Declared
|
|||||
Quarter
ended March 31, 2008
|
$
|
12.84
|
$
|
9.93
|
$
|
0.090
|
||
Quarter
ended December 31, 2007
|
15.36
|
11.55
|
0.110
|
|||||
Quarter
ended September 30, 2007
|
15.73
|
13.30
|
0.110
|
|||||
Quarter
ended June 30, 2007
|
16.28
|
13.69
|
0.110
|
3/31/04*
|
3/31/05
|
3/31/06
|
3/31/07
|
3/31/08
|
3/31/09
|
||
Riverview
Bancorp, Inc.
|
100.00
|
108.31
|
140.47
|
172.02
|
111.35
|
43.99
|
|
S
& P 500
|
100.00
|
106.69
|
119.20
|
133.31
|
126.54
|
78.34
|
|
NASDAQ
Bank
|
100.00
|
101.09
|
113.50
|
115.46
|
91.97
|
56.72
|
At
March 31,
|
||||||||||||||
2009
|
2008
|
2007
|
2006
(1)
|
2005
|
||||||||||
(Dollars
in thousands)
|
||||||||||||||
FINANCIAL
CONDITION DATA:
|
||||||||||||||
Total
assets
|
$
|
914,333
|
$
|
886,849
|
$
|
820,348
|
$
|
763,847
|
$
|
572,571
|
||||
Loans
receivable, net
|
784,117
|
756,538
|
682,951
|
623,016
|
429,449
|
|||||||||
Loans
held for sale
|
1,332
|
-
|
-
|
65
|
510
|
|||||||||
Mortgage-backed
securities held
to
maturity
|
570
|
885
|
1,232
|
1,805
|
2,343
|
|||||||||
Mortgage-backed
securities available
for
sale
|
4,066
|
5,338
|
6,640
|
8,134
|
11,619
|
|||||||||
Cash
and interest-bearing deposits
|
19,199
|
36,439
|
31,423
|
31,346
|
61,719
|
|||||||||
Investment
securities held to maturity
|
529
|
-
|
-
|
-
|
-
|
|||||||||
Investment
securities available for
sale
|
8,490
|
7,487
|
19,267
|
24,022
|
22,945
|
|||||||||
Deposit
accounts
|
670,066
|
667,000
|
665,405
|
606,964
|
456,878
|
|||||||||
FHLB
advances
|
37,850
|
92,850
|
35,050
|
46,100
|
40,000
|
|||||||||
Federal
Reserve Bank advances
|
85,000
|
-
|
-
|
-
|
-
|
|||||||||
Shareholders’
equity
|
88,663
|
92,585
|
100,209
|
91,687
|
69,522
|
|||||||||
Year
Ended March 31,
|
||||||||||||||
2009
|
2008
|
2007
|
2006
(1)
|
2005
|
||||||||||
(Dollars
in thousands, except per share data)
|
||||||||||||||
OPERATING
DATA:
|
||||||||||||||
Interest
income
|
$
|
52,850
|
$
|
60,682
|
$
|
61,300
|
$
|
47,229
|
$
|
29,968
|
||||
Interest
expense
|
19,183
|
25,730
|
24,782
|
14,877
|
7,395
|
|||||||||
Net
interest income
|
33,667
|
34,952
|
36,518
|
32,352
|
22,573
|
|||||||||
Provision
for loan losses
|
16,150
|
2,900
|
1,425
|
1,500
|
410
|
|||||||||
Net
interest income after provision
for
loan losses
|
17,517
|
32,052
|
35,093
|
30,852
|
22,163
|
|||||||||
Gains
(losses) from sale of loans,
securities
and REO
|
729
|
368
|
434
|
382
|
(672)
|
|||||||||
Impairment
on investment security
|
(3,414
|
)
|
-
|
-
|
-
|
-
|
||||||||
Gain
on sale of land and fixed assets
|
-
|
6
|
3
|
2
|
830
|
|||||||||
Other
non-interest income
|
8,215
|
8,508
|
8,597
|
8,453
|
6,348
|
|||||||||
Non-interest
expenses
|
27,259
|
27,791
|
26,353
|
25,374
|
19,104
|
|||||||||
Income
(loss) before income taxes
|
(4,212
|
)
|
13,143
|
17,774
|
14,315
|
9,565
|
||||||||
Provision
(benefit) for income taxes
|
(1,562
|
)
|
4,499
|
6,168
|
4,577
|
3,036
|
||||||||
Net
income (loss)
|
$
|
(2,650
|
)
|
$
|
8,644
|
$
|
11,606
|
$
|
9,738
|
$
|
6,529
|
Basic
|
$
|
(0.25
|
)
|
$
|
0.79
|
$
|
1.03
|
$
|
0.87
|
$
|
0.68
|
|||
Diluted
|
(0.25
|
)
|
0.79
|
1.01
|
0.86
|
0.67
|
||||||||
Dividends
per share
|
0.135
|
0.42
|
0.395
|
0.34
|
0.31
|
|
At
March 31,
|
||||||||||||||
2009
|
2008
|
2007
|
2006
(1)
|
2005
|
|||||||||||
OTHER
DATA:
|
|||||||||||||||
Number
of:
|
|||||||||||||||
Real
estate loans outstanding
|
2,841
|
2,926
|
2,978
|
3,084
|
3,037
|
||||||||||
Deposit
accounts
|
42,740
|
41,354
|
38,989
|
39,095
|
29,341
|
||||||||||
Full
service offices
|
18
|
18
|
18
|
17
|
13
|
||||||||||
At
or For the Year Ended March 31,
|
|||||||||||||||
2009
|
2008
|
2007
|
2006
(1)
|
2005
|
|||||||||||
(Dollars
in Thousands)
|
|||||||||||||||
KEY
FINANCIAL RATIOS:
|
|||||||||||||||
Performance
Ratios:
|
|||||||||||||||
Return
on average assets
|
(0.29
|
)%
|
1.04
|
%
|
1.43
|
%
|
1.36
|
%
|
1.24
|
%
|
|||||
Return
on average equity
|
(2.85
|
)
|
8.92
|
11.88
|
10.95
|
9.56
|
|||||||||
Dividend
payout ratio
(2)
|
(54.00
|
)
|
53.16
|
38.35
|
39.08
|
45.59
|
|||||||||
Interest
rate spread
|
3.73
|
4.09
|
4.37
|
4.55
|
4.38
|
||||||||||
Net
interest margin
|
4.08
|
4.66
|
5.01
|
5.03
|
4.74
|
||||||||||
Non-interest
expense to average assets
|
3.02
|
3.34
|
3.24
|
3.54
|
3.62
|
||||||||||
Efficiency
ratio
|
69.5
|
63.40
|
57.85
|
61.60
|
65.70
|
||||||||||
Asset
Quality Ratios:
|
|||||||||||||||
Average
interest-earning assets
to
interest-bearing liabilities
|
114.85
|
116.75
|
118.96
|
121.14
|
123.45
|
||||||||||
Allowance
for loan losses to
total
net loans at end of period
|
2.12
|
1.39
|
1.25
|
1.15
|
1.01
|
||||||||||
Net
charge-offs to average outstanding
loans
during the period
|
1.24
|
0.12
|
-
|
0.10
|
0.13
|
||||||||||
Ratio
of nonperforming assets
to
total assets
|
4.57
|
0.92
|
0.03
|
0.05
|
0.13
|
||||||||||
Capital
Ratios:
|
|||||||||||||||
Average
equity to average assets
|
10.29
|
11.65
|
12.01
|
12.39
|
12.92
|
||||||||||
Equity
to assets at end of fiscal year
|
9.70
|
10.44
|
12.22
|
12.00
|
12.14
|
(1)
|
On
April 22, 2005, the Company acquired American Pacific
Bank.
|
(2)
|
Dividends
per share divided by earnings per
share
|
Within
1
Year
|
1
to 3
Years
|
3
- 5
Years
|
After
5
Years
|
Total
Balance
|
||||||||||
Certificates
of deposit
|
$
|
232,888
|
$
|
34,159
|
$
|
8,629
|
$
|
2,001
|
$
|
277,677
|
||||
FRB
advances
|
85,000
|
-
|
-
|
-
|
85,000
|
|||||||||
FHLB
advances
|
37,850
|
-
|
-
|
-
|
37,850
|
|||||||||
Operating
leases
|
1,632
|
1,863
|
1,586
|
2,927
|
8,008
|
|||||||||
Capital
leases
|
40
|
96
|
152
|
2,361
|
2,649
|
|||||||||
Junior
subordinates debentures
|
-
|
-
|
-
|
22,681
|
22,681
|
|||||||||
Total
other contractual obligations
|
$
|
357,410
|
$
|
36,118
|
$
|
10,367
|
$
|
29,970
|
$
|
433,865
|
Change
in interest rates:
|
Percent
Change in Net
Interest
Income (12 months)
|
Percent
Change in Net
Interest
Income (24 months)
|
|
Up
200 basis points
|
(0.7%)
|
(1.7%)
|
|
Base
Case
|
-
|
1.4%
|
|
Down
100 basis points
|
1.2%
|
4.2%
|
Average
Rate
|
Within
1
Year
|
1
- 3
Years
|
After
3
- 5
Years
|
After
5
- 10
Years
|
Beyond
10
Years
|
Total
|
|||||||||||||||
Interest-Sensitive
Assets:
|
|||||||||||||||||||||
Loans
receivable
|
6.06
|
%
|
$
|
277,405
|
$
|
70,389
|
$
|
71,703
|
$
|
294,903
|
$
|
86,691
|
$
|
801,091
|
|||||||
Mortgage-backed
|
|||||||||||||||||||||
securities
|
3.72
|
1,015
|
3,621
|
-
|
-
|
-
|
4,636
|
||||||||||||||
Investments
and other
|
|||||||||||||||||||||
interest-earning
assets
|
3.45
|
13,777
|
-
|
-
|
529
|
1,118
|
15,424
|
||||||||||||||
FHLB
stock
|
0.70
|
1,470
|
2,940
|
2,940
|
-
|
-
|
7,350
|
||||||||||||||
Total
assets
|
$
|
293,667
|
$
|
76,950
|
$
|
74,643
|
$
|
295,432
|
$
|
87,809
|
$
|
828,501
|
|||||||||
Interest-Sensitive
Liabilities:
|
|||||||||||||||||||||
Interest
checking
|
0.53
|
$
|
19,325
|
$
|
38,652
|
$
|
38,652
|
$
|
-
|
$
|
-
|
$
|
96,629
|
||||||||
Non-interest
checking accounts
|
-
|
17,706
|
35,411
|
35,411
|
-
|
-
|
88,528
|
||||||||||||||
Savings
accounts
|
0.55
|
5,751
|
11,501
|
11,501
|
-
|
-
|
28,753
|
||||||||||||||
Money
market accounts
|
1.55
|
35,695
|
71,392
|
71,392
|
-
|
-
|
178,479
|
||||||||||||||
Certificate
accounts
|
3.08
|
232,888
|
34,159
|
8,629
|
2,001
|
-
|
277,677
|
||||||||||||||
FHLB
advances
|
2.02
|
37,850
|
-
|
-
|
-
|
-
|
37,850
|
||||||||||||||
FRB
advances
|
0.25
|
85,000
|
-
|
-
|
-
|
-
|
85,000
|
||||||||||||||
Subordinated
debentures
|
5.65
|
-
|
-
|
-
|
-
|
22,681
|
22,681
|
||||||||||||||
Obligations
under capital lease
|
7.16
|
40
|
96
|
152
|
492
|
1,869
|
2,649
|
||||||||||||||
Total
liabilities
|
434,255
|
191,211
|
165,737
|
2,493
|
24,550
|
818,246
|
|||||||||||||||
Interest
sensitivity gap
|
(140,588
|
)
|
(114,261
|
)
|
(91,094
|
)
|
292,939
|
63,259
|
$
|
10,255
|
|||||||||||
Cumulative
interest sensitivity gap
|
$
|
(140,588
|
)
|
$
|
(254,849
|
)
|
$
|
(345,943
|
)
|
$
|
(53,004
|
)
|
$
|
10,255
|
|||||||
Off-Balance
Sheet Items:
|
|||||||||||||||||||||
Commitments
to extend credit
|
-
|
$
|
7,180
|
-
|
-
|
-
|
-
|
$
|
7,180
|
||||||||||||
Unused
lines of credit
|
-
|
$
|
115,907
|
-
|
-
|
-
|
-
|
$
|
115,907
|
TABLE
OF CONTENTS
|
||
Page
|
||
Report
of Independent Registered Public Accounting Firm – Deloitte & Touche
LLP
|
62
|
|
Consolidated
Balance Sheets as of March 31, 2009 and 2008
|
63
|
|
Consolidated
Statements of Operations for the Years Ended March 31, 2009, 2008 and
2007
|
64
|
|
Consolidated
Statements of Shareholders’ Equity for the Years Ended March 31, 2009,
2008 and 2007
|
65
|
|
Consolidated
Statements of Cash Flows for the Years Ended March 31, 2009, 2008 and
2007
|
66
|
|
Notes
to Consolidated Financial Statements
|
67
|
(Dollars
in thousands, except share data)
|
2009
|
2008
|
2007
|
||||||||
INTEREST
AND DIVIDEND INCOME:
|
|||||||||||
Interest
and fees on loans receivable
|
$
|
51,883
|
$
|
58,747
|
$
|
59,496
|
|||||
Interest
on investment securities – taxable
|
407
|
488
|
854
|
||||||||
Interest
on investment securities – non taxable
|
137
|
142
|
163
|
||||||||
Interest
on mortgage-backed securities
|
211
|
323
|
421
|
||||||||
Other
interest and dividends
|
212
|
982
|
366
|
||||||||
Total
interest and dividend income
|
52,850
|
60,682
|
61,300
|
||||||||
INTEREST
EXPENSE:
|
|||||||||||
Interest
on deposits
|
15,279
|
22,143
|
20,507
|
||||||||
Interest
on borrowings
|
3,904
|
3,587
|
4,275
|
||||||||
Total
interest expense
|
19,183
|
25,730
|
24,782
|
||||||||
Net
interest income
|
33,667
|
34,952
|
36,518
|
||||||||
Less
provision for loan losses
|
16,150
|
2,900
|
1,425
|
||||||||
Net
interest income after provision for loan losses
|
17,517
|
32,052
|
35,093
|
||||||||
NON-INTEREST
INCOME:
|
|||||||||||
Fees
and service charges
|
4,669
|
5,346
|
5,747
|
||||||||
Asset
management fees
|
2,077
|
2,145
|
1,874
|
||||||||
Net
gain on sale of loans held for sale
|
729
|
368
|
434
|
||||||||
Impairment
on investment security
|
(3,414
|
)
|
-
|
-
|
|||||||
Loan
servicing income
|
105
|
126
|
155
|
||||||||
Gain
of sale of credit card portfolio
|
-
|
-
|
133
|
||||||||
Bank
owned life insurance
|
573
|
562
|
522
|
||||||||
Other
|
791
|
335
|
169
|
||||||||
Total
non-interest income
|
5,530
|
8,882
|
9,034
|
||||||||
NON-INTEREST
EXPENSE:
|
|||||||||||
Salaries
and employee benefits
|
15,080
|
16,249
|
15,012
|
||||||||
Occupancy
and depreciation
|
5,064
|
5,146
|
4,687
|
||||||||
Data
processing
|
841
|
786
|
988
|
||||||||
Amortization
of core deposit intangible
|
131
|
155
|
184
|
||||||||
Advertising
and marketing expense
|
727
|
1,054
|
1,102
|
||||||||
FDIC
insurance premium
|
760
|
210
|
74
|
||||||||
State
and local taxes
|
668
|
741
|
644
|
||||||||
Telecommunications
|
466
|
406
|
437
|
||||||||
Professional
fees
|
1,110
|
826
|
809
|
||||||||
Other
|
2,412
|
2,218
|
2,416
|
||||||||
Total
non-interest expense
|
27,259
|
27,791
|
26,353
|
||||||||
INCOME
(LOSS) BEFORE INCOME TAXES
|
(4,212
|
)
|
13,143
|
17,774
|
|||||||
PROVISION
(BENEFIT) FOR INCOME TAXES
|
(1,562
|
)
|
4,499
|
6,168
|
|||||||
NET
INCOME (LOSS)
|
$
|
(2,650
|
)
|
$
|
8,644
|
$
|
11,606
|
||||
Earnings
(loss) per common share:
|
|||||||||||
Basic
|
$
|
(0.25
|
)
|
$
|
0.79
|
$
|
1.03
|
||||
Diluted
|
(0.25
|
)
|
0.79
|
1.01
|
|||||||
Weighted
average number of shares outstanding:
|
|||||||||||
Basic
|
10,693,795
|
10,915,271
|
11,312,847
|
||||||||
Diluted
|
10,693,795
|
11,006,673
|
11,516,232
|
Unearned | |||||||||||||||||||||
Shares | |||||||||||||||||||||
Issued to | |||||||||||||||||||||
Employee | Accumulated | ||||||||||||||||||||
Common Stock | Additional | Stock | Other | ||||||||||||||||||
Paid-In
|
Retained | Ownership | Comprehensive | ||||||||||||||||||
(D ollars in thousands, except share data) | Shares | Amount | Capital | Earnings | Trust | Loss | Total | ||||||||||||||
Balance
April 1, 2006
|
11,545,372
|
$
|
57
|
$
|
57,316
|
$
|
35,776
|
$
|
(1,186
|
)
|
$
|
(276
|
)
|
$
|
91,687
|
||||||
Stock
split
|
-
|
58
|
-
|
(58
|
)
|
-
|
-
|
-
|
|||||||||||||
Cash
dividends ($0.395 per
share)
|
-
|
-
|
-
|
(4,476
|
)
|
-
|
-
|
(4,476
|
)
|
||||||||||||
Exercise
of stock options
|
212,054
|
2
|
878
|
-
|
-
|
-
|
880
|
||||||||||||||
Stock
repurchased and retired
|
(49,446
|
)
|
-
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||
Earned
ESOP shares
|
-
|
-
|
196
|
-
|
78
|
-
|
274
|
||||||||||||||
Tax
benefit, stock options
|
-
|
-
|
48
|
-
|
-
|
-
|
48
|
||||||||||||||
11,707,980
|
117
|
58,438
|
31,242
|
(1,108
|
)
|
(276
|
)
|
88,413
|
|||||||||||||
Comprehensive
income:
|
|||||||||||||||||||||
Net
income
|
-
|
-
|
-
|
11,606
|
-
|
-
|
11,606
|
||||||||||||||
Other
comprehensive income:
|
|||||||||||||||||||||
Unrealized
holding gain on
|
|||||||||||||||||||||
securities
of $190 (net of $99 tax effect)
|
-
|
-
|
-
|
-
|
-
|
190
|
190
|
||||||||||||||
Total
comprehensive income
|
-
|
-
|
-
|
-
|
-
|
-
|
11,796
|
||||||||||||||
Balance
March 31, 2007
|
11,707,980
|
117
|
58,438
|
42,848
|
(1,108
|
)
|
(86
|
)
|
100,209
|
||||||||||||
Cash
dividends ($0.42 per
share)
|
-
|
-
|
-
|
(4,556
|
)
|
-
|
-
|
(4,556
|
)
|
||||||||||||
Exercise
of stock options
|
95,620
|
1
|
707
|
-
|
-
|
-
|
708
|
||||||||||||||
Stock
repurchased and retired
|
(889,827
|
)
|
(9
|
)
|
(12,634
|
)
|
-
|
-
|
-
|
(12,643
|
)
|
||||||||||
FIN
48 transition adjustment
|
-
|
-
|
-
|
(65
|
)
|
-
|
-
|
(65
|
)
|
||||||||||||
Earned
ESOP shares
|
-
|
-
|
282
|
-
|
132
|
-
|
414
|
||||||||||||||
Tax
benefit, stock options
|
-
|
-
|
6
|
-
|
-
|
-
|
6
|
||||||||||||||
10,913,773
|
109
|
46,799
|
38,227
|
(976
|
)
|
(86
|
)
|
84,073
|
|||||||||||||
Comprehensive
income:
|
|||||||||||||||||||||
Net
income
|
-
|
-
|
-
|
8,644
|
-
|
-
|
8,644
|
||||||||||||||
Other
comprehensive income:
|
|||||||||||||||||||||
Unrealized
holding loss on
|
|||||||||||||||||||||
securities
of $132 (net of $69 tax effect)
|
-
|
-
|
-
|
-
|
-
|
(132
|
)
|
(132
|
)
|
||||||||||||
Total
comprehensive income
|
-
|
-
|
-
|
-
|
-
|
-
|
8,512
|
||||||||||||||
Balance
March 31, 2008
|
10,913,773
|
109
|
46,799
|
46,871
|
(976
|
)
|
(218
|
)
|
92,585
|
||||||||||||
Cash
dividends ($0.135 per
share)
|
-
|
-
|
-
|
(1,441
|
)
|
-
|
-
|
(1,441
|
)
|
||||||||||||
Exercise
of stock options
|
10,000
|
-
|
96
|
-
|
-
|
-
|
96
|
||||||||||||||
Earned
ESOP shares
|
-
|
-
|
(31
|
)
|
-
|
74
|
-
|
43
|
|||||||||||||
Cumulative
effect of adopting
FSP
FAS 115-2
|
-
|
-
|
-
|
1,542
|
(1,542
|
)
|
-
|
||||||||||||||
Tax
benefit, stock options
|
-
|
-
|
2
|
-
|
-
|
-
|
2
|
||||||||||||||
10,923,773
|
109
|
46,866
|
46,972
|
(902
|
)
|
(1,760
|
)
|
91,285
|
|||||||||||||
Comprehensive
loss:
|
|||||||||||||||||||||
Net
loss
|
-
|
-
|
-
|
(2,650
|
)
|
-
|
-
|
(2,650
|
)
|
||||||||||||
Other
comprehensive loss:
|
|||||||||||||||||||||
Unrealized
holding gain on
|
|||||||||||||||||||||
securities
of $2,225 (net of $1,146 tax effect) less reclassification
adjustment for net losses included in net income of $2,253 (net of $1,161
tax effect)
|
-
|
-
|
-
|
-
|
-
|
28
|
28
|
||||||||||||||
Total
comprehensive loss
|
-
|
-
|
-
|
-
|
-
|
-
|
(2,622
|
)
|
|||||||||||||
Balance
March 31, 2009
|
10,923,773
|
$
|
109
|
$
|
46,866
|
$
|
44,322
|
$
|
(902
|
)
|
$
|
(1,732
|
)
|
$
|
88,663
|
||||||
1.
|
SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES
|
2.
|
RESTRICTED
ASSETS
|
3.
|
INVESTMENT
SECURITIES
|
Amortized
Cost
|
Gross
Unrealized Gains
|
Gross
Unrealized Losses
|
Estimated
Fair
Value
|
||||||||
March 31,
2009
|
|||||||||||
Municipal
bonds
|
$
|
529
|
$
|
23
|
$
|
-
|
$
|
552
|
March 31,
2009
|
Amortized
Cost
|
Estimated
Fair
Value
|
||||
Due
in one year or less
|
$
|
-
|
$
|
-
|
||
Due
after one year through five years
|
-
|
-
|
||||
Due
after five years through ten years
|
529
|
552
|
||||
Due
after ten years
|
-
|
-
|
||||
Total
|
$
|
529
|
$
|
552
|
Amortized
Cost
|
Gross
Unrealized Gains
|
Gross
Unrealized Losses
|
Estimated
Fair
Value
|
||||||||
March 31,
2009
|
|||||||||||
Trust
preferred
|
$
|
3,977
|
$
|
-
|
$
|
(2,833
|
)
|
$
|
1,144
|
||
Agency
securities
|
5,000
|
54
|
-
|
5,054
|
|||||||
Municipal
bonds
|
2,267
|
25
|
-
|
2,292
|
|||||||
Total
|
$
|
11,244
|
$
|
79
|
$
|
(2,833
|
)
|
$
|
8,490
|
||
March 31,
2008
|
|||||||||||
Trust
preferred
|
$
|
5,000
|
$
|
-
|
$
|
(388
|
)
|
$
|
4,612
|
||
Municipal
bonds
|
2,825
|
50
|
-
|
2,875
|
|||||||
Total
|
$
|
7,825
|
$
|
50
|
$
|
(388
|
)
|
$
|
7,487
|
Less
than 12 months
|
12
months or longer
|
Total
|
||||||||||||||||
Description
of Securities
|
Fair
Value
|
Unrealized
Losses
|
Fair
Value
|
Unrealized
Losses
|
Fair
Value
|
Unrealized
Losses
|
||||||||||||
Trust
Preferred
|
$
|
-
|
$
|
-
|
$
|
1,144
|
$
|
(2,833
|
)
|
$
|
1,144
|
$
|
(2,833
|
)
|
Less
than 12 months
|
12
months or longer
|
Total
|
||||||||||||||||
Description
of Securities
|
Fair
Value
|
Unrealized
Losses
|
Fair
Value
|
Unrealized
Losses
|
Fair
Value
|
Unrealized
Losses
|
||||||||||||
Trust
Preferred
|
$
|
4,612
|
$
|
(388
|
)
|
$
|
-
|
$
|
-
|
$
|
4,612
|
$
|
(388
|
)
|
March 31,
2009
|
Amortized
Cost
|
Estimated
Fair
Value
|
||||
Due
in one year or less
|
$
|
530
|
$
|
540
|
||
Due
after one year through five years
|
5,000
|
5,054
|
||||
Due
after five years through ten years
|
619
|
635
|
||||
Due
after ten years
|
5,095
|
2,261
|
||||
Total
|
$
|
11,244
|
$
|
8,490
|
4.
|
MORTGAGE-BACKED
SECURITIES
|
March 31,
2009
|
Amortized
Cost
|
Gross
Unrealized
Gains
|
Gross
Unrealized
Losses
|
Estimated
Fair
Value
|
||||||||
Real
estate mortgage investment conduits
|
$
|
348
|
$
|
-
|
$
|
-
|
$
|
348
|
||||
FHLMC
mortgage-backed securities
|
94
|
1
|
-
|
95
|
||||||||
FNMA
mortgage-backed securities
|
128
|
1
|
-
|
129
|
||||||||
Total
|
$
|
570
|
$
|
2
|
$
|
-
|
$
|
572
|
||||
March 31,
2008
|
||||||||||||
Real
estate mortgage investment conduits
|
$
|
624
|
$
|
2
|
$
|
-
|
$
|
626
|
||||
FHLMC
mortgage-backed securities
|
104
|
1
|
-
|
105
|
||||||||
FNMA
mortgage-backed securities
|
157
|
4
|
-
|
161
|
||||||||
Total
|
$
|
885
|
$
|
7
|
$
|
-
|
$
|
892
|
March 31,
2009
|
Amortized
Cost
|
Estimated
Fair
Value
|
|||
Due
in one year or less
|
$
|
-
|
$
|
-
|
|
Due
after one year through five years
|
4
|
4
|
|||
Due
after five years through ten years
|
6
|
7
|
|||
Due
after ten years
|
560
|
561
|
|||
Total
|
$
|
570
|
$
|
572
|
March 31,
2009
|
Amortized
Cost
|
Gross
Unrealized
Gains
|
Gross
Unrealized
Losses
|
Estimated
Fair
Value
|
||||||||
Real
estate mortgage investment conduits
|
$
|
673
|
$
|
12
|
$
|
-
|
$
|
685
|
||||
FHLMC
mortgage-backed securities
|
3,249
|
61
|
-
|
3,310
|
||||||||
FNMA
mortgage-backed securities
|
69
|
2
|
-
|
71
|
||||||||
Total
|
$
|
3,991
|
$
|
75
|
$
|
-
|
$
|
4,066
|
||||
March 31,
2008
|
||||||||||||
Real
estate mortgage investment conduits
|
$
|
851
|
$
|
8
|
$
|
(1
|
)
|
$
|
858
|
|||
FHLMC
mortgage-backed securities
|
4,393
|
1
|
(4
|
)
|
4,390
|
|||||||
FNMA
mortgage-backed securities
|
87
|
3
|
-
|
90
|
||||||||
Total
|
$
|
5,331
|
$
|
12
|
$
|
(5
|
)
|
$
|
5,338
|
Less
than 12 months
|
12
months or longer
|
Total
|
||||||||||||||||
Description
of Securities
|
Fair
Value
|
Unrealized
Losses
|
Fair
Value
|
Unrealized
Losses
|
Fair
Value
|
Unrealized
Losses
|
||||||||||||
Real
estate mortgage investment conduits
|
$
|
501
|
$
|
(1
|
)
|
$
|
-
|
$
|
-
|
$
|
501
|
$
|
(1
|
)
|
||||
FHLMC
mortgage-backed securities
|
-
|
-
|
2,393
|
(4
|
)
|
2,393
|
(4
|
)
|
||||||||||
Total
temporarily impaired securities
|
$
|
501
|
$
|
(1
|
)
|
$
|
2,393
|
$
|
(4
|
)
|
$
|
2,894
|
$
|
(5
|
)
|
March 31,
2009
|
Amortized
Cost
|
Estimated
Fair
Value
|
|||
Due
in one year or less
|
$
|
-
|
$
|
-
|
|
Due
after one year through five years
|
1,460
|
1,483
|
|||
Due
after five years through ten years
|
2,084
|
2,135
|
|||
Due
after ten years
|
447
|
448
|
|||
Total
|
$
|
3,991
|
$
|
4,066
|
5.
|
LOANS
RECEIVABLE
|
March
31,
2009
|
March
31,
2008
|
||||
Commercial
and construction
|
|||||
Commercial
|
$
|
127,150
|
$
|
109,585
|
|
Other
real estate mortgage
|
447,652
|
429,422
|
|||
Real
estate construction
|
139,476
|
148,631
|
|||
Total
commercial and construction
|
714,278
|
687,638
|
|||
Consumer
|
|||||
Real
estate one-to-four family
|
83,762
|
75,922
|
|||
Other
installment
|
3,051
|
3,665
|
|||
Total
consumer
|
86,813
|
79,587
|
|||
Total
loans
|
801,091
|
767,225
|
|||
Less:
|
|||||
Allowance
for loan losses
|
16,974
|
10,687
|
|||
Loans
receivable, net
|
$
|
784,117
|
$
|
756,538
|
|
Year
Ended March 31,
|
|||||||||
2009
|
2008
|
2007
|
|||||||
Beginning
balance
|
$
|
418
|
$
|
185
|
$
|
7
|
|||
Originations
|
681
|
360
|
192
|
||||||
Principal
repayments
|
(78
|
)
|
(127
|
)
|
(14
|
)
|
|||
Ending
balance
|
$
|
1,021
|
$
|
418
|
$
|
185
|
6.
|
ALLOWANCE
FOR LOAN LOSSES
|
Year
Ended March 31,
|
|||||||||
2009
|
2008
|
2007
|
|||||||
Beginning
balance
|
$
|
10,687
|
$
|
8,653
|
$
|
7,221
|
|||
Provision
for loan losses
|
16,150
|
2,900
|
1,425
|
||||||
Charge-offs
|
(9,890
|
)
|
(905
|
)
|
(186
|
)
|
|||
Recoveries
|
27
|
39
|
193
|
||||||
Ending
balance
|
$
|
16,974
|
$
|
10,687
|
$
|
8,653
|
Year
Ended March 31,
|
|||||||||
2009
|
2008
|
2007
|
|||||||
Beginning
balance
|
$
|
337
|
$
|
380
|
$
|
362
|
|||
Net
change in allowance for unfunded loan commitments
|
(41
|
)
|
(43
|
)
|
18
|
||||
Ending
balance
|
$
|
296
|
$
|
337
|
$
|
380
|
7.
|
PREMISES
AND EQUIPMENT
|
March
31,
|
|||||||
2009
|
2008
|
||||||
Land
|
$
|
3,890
|
$
|
3,878
|
|||
Buildings
and improvements
|
13,074
|
13,067
|
|||||
Leasehold
improvements
|
1,994
|
1,996
|
|||||
Furniture
and equipment
|
10,275
|
10,151
|
|||||
Buildings
under capitalized leases
|
2,715
|
2,715
|
|||||
Construction
in progress
|
-
|
2
|
|||||
Total
|
31,948
|
31,809
|
|||||
Less
accumulated depreciation and amortization
|
(12,434
|
)
|
(10,783
|
)
|
|||
Premises
and equipment, net
|
$
|
19,514
|
$
|
21,026
|
Year
Ending March 31:
|
Operating
Lease
|
Capital
Lease
|
|||||
2010
|
$
|
1,632
|
$
|
228
|
|||
2011
|
1,046
|
228
|
|||||
2012
|
817
|
236
|
|||||
2013
|
820
|
251
|
|||||
2014
|
766
|
251
|
|||||
Thereafter
|
2,927
|
3,934
|
|||||
Total
minimum lease payments
|
$
|
8,008
|
5,128
|
||||
Less
amount representing interest
|
(2,479
|
)
|
|||||
Present
value of net minimum lease
|
$
|
2,649
|
8.
|
MORTGAGE
SERVICING RIGHTS
|
Year
Ended March 31,
|
|||||||||
2009
|
2008
|
2007
|
|||||||
Balance
at beginning of year, net
|
$
|
302
|
$
|
351
|
$
|
384
|
|||
Additions
|
344
|
139
|
148
|
||||||
Amortization
|
(184
|
)
|
(216
|
)
|
(206 ) | ||||
Change
in valuation allowance
|
6
|
28
|
25
|
||||||
Balance
end of year, net
|
$
|
468
|
$
|
302
|
$
|
351
|
|||
Valuation
allowance at beginning of year
|
$
|
7
|
$
|
35
|
$
|
60
|
|||
Change
in valuation allowance
|
(6
|
)
|
(28
|
)
|
(25 ) | ||||
Valuation
allowance balance at end of year
|
$
|
1
|
$
|
7
|
$
|
35
|
9.
|
REAL
ESTATE OWNED
|
Year
Ended March 31,
|
|||||||||
2009
|
2008
|
2007
|
|||||||
Balance
at beginning of year, net
|
$
|
494
|
$
|
-
|
$
|
-
|
|||
Additions
|
14,666
|
503
|
-
|
||||||
Dispositions
|
(889
|
)
|
-
|
-
|
|||||
Valuation
adjustments
|
(100
|
)
|
(9
|
)
|
-
|
||||
Balance
end or year, net
|
$
|
14,171
|
$
|
494
|
$
|
-
|
|||
Valuation
allowance at beginning of year
|
$
|
9
|
$
|
-
|
$
|
-
|
|||
Additions
to the valuation allowance
|
100
|
9
|
-
|
||||||
Reductions
due to sales of REO
|
-
|
-
|
-
|
||||||
Valuation
allowance balance at end of year
|
$
|
109
|
$
|
9
|
$
|
-
|
10.
|
DEPOSIT
ACCOUNTS
|
Account Type
|
Weighted
Average
Rate
|
March
31,
2009
|
Weighted
Average
Rate
|
March
31,
2008
|
||||||||
Non-interest-bearing
|
0.00
|
%
|
$
|
88,528
|
0.00
|
%
|
$
|
82,121
|
||||
Interest
checking
|
0.53
|
96,629
|
1.32
|
102,489
|
||||||||
Money
market
|
1.55
|
178,479
|
2.39
|
189,309
|
||||||||
Savings
accounts
|
0.55
|
28,753
|
0.55
|
27,401
|
||||||||
Certificate
of deposit
|
3.08
|
277,677
|
4.29
|
265,680
|
||||||||
Total
|
1.79
|
%
|
$
|
670,066
|
2.61
|
%
|
$
|
667,000
|
Year
Ended March 31,
|
||||||||||
2009
|
2008
|
2007
|
||||||||
Interest
checking
|
$
|
983
|
$
|
3,906
|
$
|
4,364
|
||||
Money
market
|
3,810
|
8,882
|
6,971
|
|||||||
Savings
accounts
|
149
|
151
|
179
|
|||||||
Certificate
of deposit
|
10,337
|
9,204
|
8,993
|
|||||||
Total
|
$
|
15,279
|
$
|
22,143
|
$
|
20,507
|
11.
|
FEDERAL
HOME LOAN BANK ADVANCES
|
12.
|
FEDERAL
RESERVE BANK ADVANCES
|
13.
|
JUNIOR
SUBORDINATED DEBENTURES
|
14.
|
INCOME
TAXES
|
2009
|
2008
|
2007
|
|||||||
Current
|
$
|
2,091
|
$
|
4,894
|
$
|
6,604
|
|||
Deferred
|
(3,653
|
)
|
(395
|
)
|
(436
|
)
|
|||
Total
|
$
|
(1,562
|
)
|
$
|
4,499
|
$
|
6,168
|
2009
|
2008
|
|||||
Deferred
tax assets:
|
||||||
Deferred
compensation
|
$
|
593
|
$
|
660
|
||
Loan
loss reserve
|
6,131
|
4,014
|
||||
Core
deposit intangible
|
10
|
90
|
||||
Accrued
expenses
|
190
|
215
|
||||
Accumulated
depreciation
|
368
|
446
|
||||
Net
unrealized loss on securities available for sale
|
98
|
112
|
||||
Impairment
on investment security
|
1,212
|
-
|
||||
Capital
loss carry forward
|
684
|
699
|
||||
REO
expense
|
796
|
186
|
||||
Non-compete
|
146
|
164
|
||||
Other
|
117
|
159
|
||||
Total
deferred tax asset
|
10,345
|
6,745
|
||||
Deferred
tax liabilities:
|
||||||
FHLB
stock dividend
|
(1,063
|
)
|
(1,093
|
)
|
||
Deferred
gain on sale
|
(210
|
)
|
(170
|
)
|
||
Tax
qualified loan loss reserve
|
-
|
(27
|
)
|
|||
Purchase
accounting
|
(151
|
)
|
(203
|
)
|
||
Prepaid
expense
|
(125
|
)
|
(97
|
)
|
||
Loan
fees/costs
|
(587
|
)
|
(584
|
)
|
||
Total
deferred tax liability
|
(2,136
|
)
|
(2,174
|
)
|
||
Deferred
tax asset, net
|
$
|
8,209
|
$
|
4,571
|
2009
|
2008
|
2007
|
||||||||
Statutory
federal income tax rate
|
(34.0
|
)%
|
35.0
|
%
|
35.0
|
%
|
||||
State
and local income tax rate
|
(1.5
|
)
|
1.2
|
0.9
|
||||||
ESOP
market value adjustment
|
0.3
|
0.8
|
0.5
|
|||||||
Interest
income on municipal securities
|
(1.2
|
)
|
(0.4
|
)
|
(0.3
|
)
|
||||
Bank
owned life insurance
|
(4.8
|
)
|
(1.5
|
)
|
(1.1
|
)
|
||||
Other,
net
|
4.1
|
(0.9
|
)
|
(0.4
|
)
|
|||||
Effective
federal income tax rate
|
(37.1
|
)%
|
34.2
|
%
|
34.6
|
%
|
March
31,
|
||||||
2009
|
2008
|
|||||
Balance
at beginning of year
|
$
|
90
|
$
|
90
|
||
Additions
based on tax positions related to the current year
|
-
|
-
|
||||
Additions
for tax positions of prior years
|
-
|
-
|
||||
Reductions
for tax positions of prior years
|
(21
|
)
|
-
|
|||
Settlements
|
(69
|
)
|
-
|
|||
Balance
end or year
|
$
|
-
|
$
|
90
|
15.
|
EMPLOYEE
BENEFITS PLANS
|
Risk
Free
Interest
Rate
|
Expected
Life
(yrs
)
|
Expected
Volatility
|
Expected
Dividends
|
||
Fiscal
2009
|
2.99%
|
6.25
|
20.20%
|
2.77%
|
|
Fiscal
2008
|
4.32%
|
6.25
|
15.13%
|
3.06%
|
Year
Ended March 31,
|
|||||||||||||||
2009
|
2008
|
2007
|
|||||||||||||
Number
of Shares
|
Weighted
Average Exercise Price
|
Number
of Shares
|
Weighted
Average Exercise Price
|
Number
of Shares
|
Weighted
Average Exercise Price
|
||||||||||
Balance,
beginning of period
|
424,972
|
$
|
11.02
|
526,192
|
$
|
10.41
|
755,846
|
$
|
9.68
|
||||||
Grants
|
38,500
|
6.30
|
20,000
|
13.42
|
-
|
-
|
|||||||||
Options
exercised
|
(10,000
|
) |
4.70
|
(95,620
|
)
|
7.68
|
(212,054
|
)
|
7.79
|
||||||
Forfeited
|
(48,000
|
) |
11.71
|
(25,600
|
)
|
12.69
|
(17,600
|
)
|
10.65
|
||||||
Expired
|
(33,776
|
) |
6.88
|
-
|
-
|
-
|
-
|
||||||||
Balance,
end of period
|
371,696
|
$
|
10.99
|
424,972
|
$
|
11.02
|
526,192
|
$
|
10.41
|
Options
Outstanding
|
Options
Exercisable
|
|||||||||||
Weighted
Avg
|
Weighted
|
Weighted
|
||||||||||
Remaining
|
Average
|
Average
|
||||||||||
Range
of
|
Contractual
|
Number
|
Exercise
|
Number
|
Exercise
|
|||||||
Exercise
Price
|
Life
(years)
|
Outstanding
|
Price
|
Exercisable
|
Price
|
|||||||
$4.03
- $6.16
|
6.20
|
55,996
|
$
|
5.93
|
19,996
|
$
|
5.50
|
|||||
$6.51
- $6.88
|
3.10
|
20,000
|
6.76
|
20,000
|
6.76
|
|||||||
$7.49
- $9.51
|
4.46
|
33,700
|
8.45
|
31,700
|
8.48
|
|||||||
$10.10
- $10.83
|
6.00
|
33,000
|
10.26
|
27,200
|
10.24
|
|||||||
$12.98
- $14.52
|
7.04
|
229,000
|
13.07
|
220,000
|
13.02
|
|||||||
6.38
|
371,696
|
$
|
10.99
|
318,896
|
$
|
11.46
|
16.
|
EMPLOYEE
STOCK OWNERSHIP PLAN
|
Fair
Value
of
Unreleased
Shares
|
Unreleased
ESOP
Shares
|
Allocated
and
Released
Shares
|
Total
|
|||||
Balance,
March 31, 2006
|
$
|
3,955,000
|
295,596
|
666,988
|
962,584
|
|||
Allocation
December 31, 2006
|
(24,633
|
)
|
24,633
|
-
|
||||
Balance,
March 31, 2007
|
$
|
4,319,000
|
270,963
|
691,621
|
962,584
|
|||
Allocation
December 31, 2007
|
(24,633
|
)
|
24,633
|
-
|
||||
Balance,
March 31, 2008
|
$
|
2,458,000
|
246,330
|
716,254
|
962,584
|
|||
Allocation
December 31, 2008
|
(24,633
|
)
|
24,633
|
-
|
||||
Balance,
March 31, 2009
|
$
|
858,000
|
221,697
|
740,887
|
962,584
|
17.
|
SHAREHOLDERS’
EQUITY AND REGULATORY CAPITAL
REQUIREMENTS
|
Actual
|
For
Capital Adequacy Purposes
|
“Well
Capitalized” Under Prompt Corrective Action
|
||||||||||||||
Amount
|
Ratio
|
Amount
|
Ratio
|
Amount
|
Ratio
|
|||||||||||
March
31, 2009
|
||||||||||||||||
Total
Capital:
|
||||||||||||||||
(To
Risk-Weighted Assets)
|
$
|
94,654
|
11.46
|
%
|
$
|
66,080
|
8.0
|
%
|
$
|
82,599
|
10.0
|
%
|
||||
Tier
1 Capital:
|
||||||||||||||||
(To
Risk-Weighted Assets)
|
84,300
|
10.21
|
33,040
|
4.0
|
49,560
|
6.0
|
||||||||||
Tier
1 Capital (Leverage):
|
||||||||||||||||
(To
Adjusted Tangible Assets)
|
84,300
|
9.50
|
35,502
|
4.0
|
44,377
|
5.0
|
||||||||||
Tangible
Capital:
|
||||||||||||||||
(To
Tangible Assets)
|
84,300
|
9.50
|
13,313
|
1.5
|
N/A
|
N/A
|
Actual
|
For
Capital Adequacy Purposes
|
“Well
Capitalized” Under Prompt Corrective Action
|
||||||||||||||
Amount
|
Ratio
|
Amount
|
Ratio
|
Amount
|
Ratio
|
|||||||||||
March
31, 2008
|
||||||||||||||||
Total
Capital:
|
||||||||||||||||
(To
Risk-Weighted Assets)
|
$
|
88,806
|
10.99
|
%
|
$
|
64,627
|
8.0
|
%
|
$
|
80,784
|
10.0
|
%
|
||||
Tier
1 Capital:
|
||||||||||||||||
(To
Risk-Weighted Assets)
|
79,021
|
9.78
|
32,314
|
4.0
|
48,470
|
6.0
|
||||||||||
Tier
1 Capital (Leverage):
|
||||||||||||||||
(To Adjusted Tangible Assets)
|
79,021
|
9.29
|
25,530
|
3.0
|
42,550
|
5.0
|
||||||||||
Tangible
Capital:
|
||||||||||||||||
(To
Tangible Assets)
|
79,021
|
9.29
|
12,765
|
1.5
|
N/A
|
N/A
|
Shares
|
Value
|
|||
2009
|
-
|
$
|
-
|
|
2008
|
875,000
|
$
|
12,643
|
|
2007
|
-
|
$
|
-
|
18.
|
EARNINGS
PER SHARE
|
Years
Ended March 31,
|
|||||||||
2009
|
2008
|
2007
|
|||||||
Basic
EPS computation:
|
|||||||||
Numerator-net
income (loss)
|
$
|
(2,650,000
|
) |
$
|
8,644,000
|
$
|
11,606,000
|
||
Denominator-weighted
average
common
shares outstanding
|
10,693,795
|
10,915,271
|
11,312,847
|
||||||
Basic
EPS
|
$
|
(0.25
|
) |
$
|
0.79
|
$
|
1.03
|
||
Diluted
EPS computation:
|
|||||||||
Numerator-net
income (loss)
|
$
|
(2,650,000
|
) |
$
|
8,644,000
|
$
|
11,606,000
|
||
Denominator-weighted
average
common
shares outstanding
|
10,693,795
|
10,915,271
|
11,312,847
|
||||||
Effect
of dilutive stock options
|
-
|
91,402
|
203,385
|
||||||
Weighted
average common shares
|
|||||||||
and
common stock equivalents
|
10,693,795
|
11,006,673
|
11,516,232
|
||||||
Diluted
EPS
|
$
|
(0.25
|
) |
$
|
0.79
|
$
|
1.01
|
19.
|
FAIR
VALUE MEASUREMENT
|
|
Fair
value measurements at March 31, 2009, using
|
||||||||||
Quoted
prices in
active
markets for identical assets
|
Other
observable
inputs
|
Significant
unobservable
inputs
|
|||||||||
Fair
value
March
31, 2009
|
(Level
1)
|
(Level
2)
|
(Level
3)
|
||||||||
Investment
securities available for sale
|
$
|
8,490
|
$
|
-
|
$
|
7,346
|
$
|
1,144
|
|||
Mortgage-backed
securities available for sale
|
4,066
|
-
|
4,066
|
-
|
|||||||
Total
recurring assets measured at fair value
|
$
|
12,556
|
$
|
-
|
$
|
11,412
|
$
|
1,144
|
For
the Year Ended
|
|||
March
31, 2009
|
|||
Available
for sale securities
|
|||
Balance
at March 31, 2008
|
$
|
-
|
|
Transfers
in to Level 3
|
4,612
|
||
Included
in earnings
(1)
|
(3,414
|
)
|
|
Included
in other comprehensive income
(2)
|
(54
|
)
|
|
Balance
at March 31, 2009
|
$
|
1,144
|
|
(1)
Included in other non-interest income
|
|||
(2)
Includes the reversal of previously recorded OTTI
|
|
Fair
value measurements at March 31, 2009, using
|
||||||||||
Quoted
prices in
active
markets for identical assets
|
Other
observable
inputs
|
Significant
unobservable
inputs
|
|||||||||
Fair
value
March
31, 2009
|
(Level
1)
|
|
(Level
2)
|
|
(Level
3)
|
||||||
Loans
measured for impairment
|
$
|
24,389
|
$
|
-
|
$
|
-
|
$
|
24,389
|
|||
Real
estate owned
|
14,171
|
-
|
-
|
14,171
|
|||||||
Total
nonrecurring assets measured at fair value
|
$
|
38,560
|
$
|
-
|
$
|
-
|
$
|
38,560
|
20.
|
FAIR
VALUE OF FINANCIAL INSTRUMENTS
|
March
31,
|
|||||||||||
2009
|
2008
|
||||||||||
Carrying
Value
|
Fair
Value
|
Carrying
Value
|
Fair
Value
|
||||||||
Assets:
|
|||||||||||
Cash
|
$
|
19,199
|
$
|
19,199
|
$
|
36,439
|
$
|
36,439
|
|||
Investment
securities held to maturity
|
529
|
552
|
-
|
-
|
|||||||
Investment
securities available for sale
|
8,490
|
8,490
|
7,487
|
7,487
|
|||||||
Mortgage-backed
securities held to maturity
|
570
|
572
|
885
|
892
|
|||||||
Mortgage-backed
securities available for sale
|
4,066
|
4,066
|
5,338
|
5,338
|
|||||||
Loans
receivable, net
|
784,117
|
733,436
|
756,538
|
775,454
|
|||||||
Loans
held for sale
|
1,332
|
1,332
|
-
|
-
|
|||||||
Mortgage
servicing rights
|
468
|
929
|
302
|
973
|
|||||||
Liabilities:
|
|||||||||||
Demand
– savings deposits
|
392,389
|
392,389
|
401,320
|
401,320
|
|||||||
Time
deposits
|
277,677
|
281,120
|
265,680
|
268,747
|
|||||||
FHLB
advances
|
37,850
|
37,869
|
92,850
|
92,745
|
|||||||
FRB
advances
|
85,000
|
84,980
|
-
|
-
|
|||||||
Junior
subordinated debentures
|
22,681
|
12,702
|
22,681
|
15,734
|
21.
|
COMMITMENTS
AND CONTINGENCIES
|
22.
|
RIVERVIEW
BANCORP, INC. (PARENT COMPANY)
|
BALANCE
SHEETS
|
|||||
MARCH
31, 2009 AND 2008
|
|||||
(Dollars
in thousands)
|
2009
|
2008
|
|||
ASSETS
|
|||||
Cash
(including interest earning accounts of $
1,073
and
$8,269)
|
$
|
1,105
|
$
|
8,295
|
|
Investment
in the Bank
|
108,967
|
105,731
|
|||
Other
assets
|
1,352
|
2,318
|
|||
TOTAL
ASSETS
|
$
|
111,424
|
$
|
116,344
|
|
LIABILITIES
AND SHAREHOLDERS’ EQUITY
|
|||||
Accrued
expenses and other liabilities
|
$
|
68
|
$
|
106
|
|
Deferred
income taxes
|
12
|
12
|
|||
Borrowings
|
22,681
|
22,681
|
|||
Dividend
payable
|
-
|
960
|
|||
Shareholders'
equity
|
88,663
|
92,585
|
|||
TOTAL
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
$
|
111,424
|
$
|
116,344
|
STATEMENTS
OF OPERATIONS
|
|||||||||
YEARS
ENDED MARCH 31, 2009, 2008 AND 2007
|
|||||||||
(Dollars
in thousands)
|
2009
|
2008
|
2007
|
||||||
INCOME:
|
|||||||||
Dividend
income from Bank
|
$
|
-
|
$
|
6,386
|
$
|
7,907
|
|||
Interest
on investment securities and other short-term investments
|
114
|
468
|
172
|
||||||
Interest
on loan receivable from the Bank
|
86
|
94
|
126
|
||||||
Total
income
|
200
|
6,948
|
8,205
|
||||||
EXPENSE:
|
|||||||||
Management
service fees paid to the Bank
|
143
|
143
|
143
|
||||||
Other
expenses
|
1,656
|
1,636
|
815
|
||||||
Total
expense
|
1,799
|
1,779
|
958
|
||||||
INCOME
(LOSS) BEFORE INCOME TAXES AND EQUITY
|
|||||||||
IN
UNDISTRIBUTED INCOME OF THE BANK
|
(1,599
|
)
|
5,169
|
7,247
|
|||||
BENEFIT
FOR INCOME TAXES
|
(544
|
)
|
(426
|
)
|
(231
|
)
|
|||
INCOME
(LOSS) OF PARENT COMPANY
|
(1,055
|
)
|
5,595
|
7,478
|
|||||
EQUITY
IN UNDISTRIBUTED INCOME (LOSS) OF THE BANK
|
(1,595
|
)
|
3,049
|
4,128
|
|||||
NET
INCOME (LOSS)
|
$
|
(2,650
|
)
|
$
|
8,644
|
$
|
11,606
|
(Dollars
in thousands)
|
2009
|
2008
|
2007
|
||||||
CASH
FLOWS FROM OPERATING ACTIVITIES:
|
|||||||||
Net
income (loss)
|
$
|
(2,650
|
)
|
$
|
8,644
|
$
|
11,606
|
||
Adjustments
to reconcile net income cash provided by operating
activities:
|
|||||||||
Equity
in undistributed (earnings) loss of the Bank
|
1,595
|
(3,049
|
)
|
(4,128
|
)
|
||||
Provision
for deferred income taxes
|
-
|
34
|
13
|
||||||
Earned
ESOP shares
|
43
|
414
|
274
|
||||||
Changes
in assets and liabilities, net of acquisition
|
|||||||||
Other
assets
|
965
|
(445
|
)
|
(724
|
)
|
||||
Accrued
expenses and other liabilities
|
(87
|
)
|
(535
|
)
|
(376
|
)
|
|||
Net
cash provided (used) by operating activities
|
(134
|
)
|
5,063
|
6,665
|
|||||
CASH
FLOWS FROM INVESTING ACTIVITIES:
|
|||||||||
Additional
investment in subsidiary
|
(4,750
|
)
|
-
|
-
|
|||||
Net
cash used in investing activities
|
(4,750
|
)
|
-
|
-
|
|||||
CASH
FLOWS FROM FINANCING ACTIVITIES:
|
|||||||||
Dividends
paid
|
(2,402
|
)
|
(4,740
|
)
|
(4,289
|
)
|
|||
Proceeds
from subordinated debentures
|
-
|
15,000
|
-
|
||||||
Repurchase
of common stock
|
-
|
(12,643
|
)
|
-
|
|||||
Proceeds
from exercise of stock options
|
96
|
708
|
880
|
||||||
Net
cash used by financing activities
|
(2,306
|
)
|
(1,675
|
)
|
(3,409
|
)
|
|||
NET
INCREASE (DECREASE) IN CASH
|
(7,190
|
)
|
3,388
|
3,256
|
|||||
CASH,
BEGINNING OF YEAR
|
8,295
|
4,907
|
1,651
|
||||||
CASH,
END OF YEAR
|
$
|
1,105
|
$
|
8,295
|
$
|
4,907
|
(
Dollars in thousands, except
share data)
|
Three
Months Ended
|
||||||||||||||
March
31
|
December
31
|
September
30
|
June
30
|
||||||||||||
Fiscal
2009:
|
|||||||||||||||
Interest
income
|
$
|
12,383
|
$
|
13,172
|
$
|
13,729
|
$
|
13,566
|
|||||||
Interest
expense
|
4,096
|
4,801
|
5,087
|
5,199
|
|||||||||||
Net
interest income
|
8,287
|
8,371
|
8,642
|
8,367
|
|||||||||||
Provision
for loan losses
|
5,000
|
1,200
|
7,200
|
2,750
|
|||||||||||
Non-interest
income
|
2,759
|
1,902
|
(1,313
|
)
|
2,182
|
||||||||||
Non-interest
expense
|
6,977
|
6,907
|
6,708
|
6,667
|
|||||||||||
Income
before income taxes
|
(931
|
)
|
2,166
|
(6,579
|
)
|
1,132
|
|||||||||
Provision
(benefit) for income taxes
|
(211
|
)
|
691
|
(2,381
|
)
|
339
|
|||||||||
Net
income (loss)
|
$
|
(720
|
)
|
$
|
1,475
|
$
|
(4,198
|
)
|
$
|
793
|
|||||
Basic
earnings (loss) per share
(1)
|
$
|
(0.07
|
)
|
$
|
0.14
|
$
|
(0.39
|
)
|
$
|
0.07
|
|||||
Diluted
earnings (loss) per share
|
$
|
(0.07
|
)
|
$
|
0.14
|
$
|
(0.39
|
)
|
$
|
0.07
|
|||||
Fiscal
2008:
|
|||||||||||||||
Interest
income
|
$
|
14,608
|
$
|
15,336
|
$
|
15,314
|
$
|
15,424
|
|||||||
Interest
expense
|
6,036
|
6,478
|
6,620
|
6,596
|
|||||||||||
Net
interest income
|
8,572
|
8,858
|
8,694
|
8,828
|
|||||||||||
Provision
for loan losses
|
1,800
|
650
|
400
|
50
|
|||||||||||
Non-interest
income
|
2,214
|
2,150
|
2,216
|
2,302
|
|||||||||||
Non-interest
expense
|
7,168
|
7,011
|
6,831
|
6,781
|
|||||||||||
Income
before income taxes
|
1,818
|
3,347
|
3,679
|
4,299
|
|||||||||||
Provision
for income taxes
|
656
|
1,134
|
1,249
|
1,460
|
|||||||||||
Net
income
|
$
|
1,162
|
$
|
2,213
|
$
|
2,430
|
$
|
2,839
|
|||||||
Basic
earnings per share
(1)
|
$
|
0.11
|
$
|
0.21
|
$
|
0.22
|
$
|
0.25
|
|||||||
Diluted
earnings per share
|
$
|
0.11
|
$
|
0.21
|
$
|
0.22
|
$
|
0.25
|
(1)
|
Quarterly earnings per share may
vary from annual earnings per share due to
rounding.
|
Plan
category
|
Number
of securities
to
be issued upon
exercise
of outstanding
options
|
Weighted-
average
price of outstanding
options
|
Number
of securities remaining
available
for future issuance
under
equity compensation plans
excluding
securities reflected
in
column (A)
|
|||
Equity
compensation plans approved by security holders:
|
(A)
|
(B)
|
(C)
|
|||
2003
Stock Option Plan
|
214,000
|
$12.98
|
198,154
|
|||
1998
Stock Option Plan
|
157,696
|
8.30
|
-
|
|||
Equity
compensation plans not approved by security holders:
|
-
|
-
|
-
|
|||
|
|
|||||
Total
|
371,696
|
198,154
|
(1)
|
Filed
as an exhibit to the Registrant's Registration Statement on Form S-1
(Registration No. 333-30203), and incorporated herein by
reference.
|
(2)
|
Filed
as an exhibit to the Registrant’s Current Report on Form 8-K filed with
the SEC on September 18, 2007, and incorporated herein by
reference.
|
(3)
|
Filed
as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the
quarter ended September 30, 1997, and incorporated herein by
reference.
|
(4)
|
Filed
as an exhibit to the Registrant's Annual Report on Form 10-K for the year
ended March 31, 1998, and incorporated herein by
reference.
|
(5)
|
Filed
as an exhibit to the Registrant’s Registration Statement on Form S-8
(Registration No. 333-66049), and incorporated herein by
reference.
|
(6)
|
Filed
as an exhibit to the Registrant’s Definitive Annual Meeting Proxy
Statement (000-22957), filed with the Commission on June 5, 2003, and
incorporated herein by reference.
|
(7)
|
Filed
as an exhibit to the Registrant’s Quarterly Report on Form 10-Q for the
quarter ended December 31, 2005, and incorporated herein by
reference.
|
(8)
|
Filed
as an exhibit to the Registrant’s Annual Report on Form 10-K for the year
ended March 31, 2007, and incorporated herein by
reference.
|
RIVERVIEW BANCORP, INC. | |||
Date: June 9, 2009 | |||
By: | /s/ Patrick Sheaffer | ||
Patrick Sheaffer | |||
Chairman of the Board and | |||
Chief Executive Officer | |||
(Duly Authorized Representative) |
By: | /s/ Patrick Sheaffer | By: | /s/ R onald A. Wysaske |
Patrick Sheaffer | Ronald A. Wysaske | ||
Chairman of the Board and | President and Chief Operating Officer | ||
Chief Executive Officer | Director | ||
(Principal Executive Officer) | |||
Date: | June 9, 2009 | Date: | June 9, 2009 |
By: | /s/ Kevin J. Lycklama | By: | /s/ Paul L. Runyan |
Kevin J. Lycklama | Paul L. Runyan | ||
Senior Vice President and | Vice Chairman of the Board and | ||
Chief Financial Officer | Director | ||
(Principal Financial and Accounting Officer) | |||
Date: | June 9, 2009 | Date: | June 9, 2009 |
By: | /s/Gary R. Douglass | By: | /s/Edward R. Geiger |
Gary R. Douglass | Edward R. Geiger | ||
Director | Director | ||
Date: | June 9, 2009 | Date: | June 9, 2009 |
By: | /s/ Michael D. Allen | By: | /s/ Jerry C. Olson |
Michael D. Allen | Jerry C. Olson | ||
Director | Director | ||
Date: | June 9, 2009 | Date: | June 9, 2009 |
Exhibit
10.9
|
Deferred
Compensation Plan
|
Exhibit
23
|
Consent
of Independent Registered Public Accounting
Firm
|
Exhibit
31.1
|
Certification
of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002
|
Exhibit
31.2
|
Certification
of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002
|
Exhibit
32
|
Certification
of Chief Executive Officer and Chief Financial Officer Pursuant to 18
U.S.C. 1350 As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002
|
1.
|
I
have reviewed this Annual Report on Form 10-K of Riverview Bancorp,
Inc.;
|
2.
|
Based
on my knowledge, this report does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this
report;
|
3.
|
Based
on my knowledge, the financial statements, and other financial information
included in this report, fairly present in all material respects the
financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this
report;
|
4.
|
The
registrant’s other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal
control over financial reporting (as defined in Exchange Act Rules
13a-15(f) and 15d-15(f)) for the registrant and
have:
|
a)
|
designed
such disclosure controls and procedures, or caused such disclosure
controls and procedures to be designed under our supervision, to ensure
that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this annual report is
being prepared;
|
b)
|
designed
such internal control over financial reporting, or caused such internal
control over financial reporting to be designed under our supervision, to
provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting
principles;
|
c)
|
evaluated
the effectiveness of the registrant’s disclosure controls and procedures
and presented in this report our conclusions about the effectiveness of
the disclosure controls and procedures, as of the end of the period
covered by this report based on such evaluation;
and
|
d)
|
disclosed
in this report any change in the registrant’s internal control over
financial reporting that occurred during the registrant’s most recent
fiscal quarter (the registrant’s fiscal fourth quarter in the case of an
annual report) that has materially affected, or is reasonably likely to
materially affect, the registrant’s internal control over financial
reporting; and
|
5.
|
The
registrant’s other certifying officers and I have disclosed, based on our
most recent evaluation of internal control over financial reporting, to
the registrant’s auditors and the audit committee of registrant’s board of
directors (or persons performing the equivalent
functions):
|
a)
|
all
significant deficiencies and material weakness in the design or operation
of internal control over financial reporting which are reasonably likely
to adversely affect the registrant’s ability to record, process, summarize
and report financial data information;
and
|
b)
|
any
fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant’s internal control
over financial reporting.
|
1.
|
I
have reviewed this Annual Report on Form 10-K of Riverview Bancorp,
Inc.;
|
2.
|
Based
on my knowledge, this report does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this
report;
|
3.
|
Based
on my knowledge, the financial statements, and other financial information
included in this report, fairly present in all material respects the
financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this
report;
|
4.
|
The
registrant’s other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal
control over financial reporting (as defined in Exchange Act Rules
13a-15(f) and 15d-15(f)) for the registrant and
have:
|
a)
|
designed
such disclosure controls and procedures, or caused such disclosure
controls and procedures to be designed under our supervision, to ensure
that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this annual report is
being prepared;
|
b)
|
designed
such internal control over financial reporting, or caused such internal
control over financial reporting to be designed under our supervision, to
provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting
principles;
|
c)
|
evaluated
the effectiveness of the registrant’s disclosure controls and procedures
and presented in this report our conclusions about the effectiveness of
the disclosure controls and procedures, as of the end of the period
covered by this report based on such evaluation;
and
|
d)
|
disclosed
in this report any change in the registrant’s internal control over
financial reporting that occurred during the registrant’s most recent
fiscal quarter (the registrant’s fiscal fourth quarter in the case of an
annual report) that has materially affected, or is reasonably likely to
materially affect, the registrant’s internal control over financial
reporting; and
|
5.
|
The
registrant’s other certifying officers and I have disclosed, based on our
most recent evaluation of internal control over financial reporting, to
the registrant’s auditors and the audit committee of registrant’s board of
directors (or persons performing the equivalent
function):
|
a)
|
all
significant deficiencies and material weakness in the design or operation
of internal control over financial reporting which are reasonably likely
to adversely affect the registrant’s ability to record, process, summarize
and report financial data information;
and
|
d)
|
any
fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant’s internal control
over financial reporting.
|
1.
|
the
report fully complies with the requirements of Sections 13(a) or 15(d) of
the Securities Exchange Act of 1934, as amended,
and
|
2.
|
the
information contained in the report fairly presents, in all material
respects, the Company’s financial condition and results of operations as
of the dates and for the periods presented in the financial statements
included in such report.
|
/S/ Patrick Sheaffer
|
/S/ Kevin J.
Lycklama
|
ARTICLE
1
|
DEFINITIONS
|
|||
1.1
|
Account
|
2
|
||
1.2
|
Bank
|
2
|
||
1.3
|
Beneficiary
|
2
|
||
1.4
|
Board
|
2
|
||
1.5
|
Code
|
2
|
||
1.6
|
Committee
|
2
|
||
1.7
|
Compensation
|
2
|
||
1.8
|
Deferral
Election
|
3
|
||
1.9
|
Determination
Date
|
3
|
||
1.10
|
Director
|
3
|
||
1.11
|
Disabled
or Disability
|
3
|
||
1.12
|
Executive
Officer
|
3
|
||
1.13
|
Interest
|
3
|
||
1.14
|
Participant
|
3
|
||
1.15
|
Participating
Subsidiary
|
3
|
||
1.16
|
Participation
Agreement
|
3
|
||
1.17
|
Plan
Benefit
|
3
|
||
1.18
|
Plan
Year
|
3
|
||
1.19
|
Separation
from Service
|
3
|
||
ARTICLE
2
|
PARTICIPATION
|
|||
2.1
|
Participation
|
4
|
||
2.2
|
Deferral
Elections
|
4
|
||
2.3
|
Modification
or Revocation of Deferral Elections
|
4
|
||
ARTICLE
3
|
DEFERRED
COMPENSATION ACCOUNTS
|
|||
3.1
|
Maintenance
of Accounts
|
5
|
||
3.2
|
Account
Adjustments
|
5
|
||
3.3
|
Account
Statements
|
5
|
||
ARTICLE
4
|
PLAN
BENEFITS
|
|||
4.1
|
Amount
of Benefit
|
6
|
||
4.2
|
Time
of Payment
|
6
|
||
4.3
|
Form
of Payment
|
6
|
||
4.4
|
Overrides
|
7
|
||
4.5
|
Change
in Time or Form of Payment
|
7
|
||
4.6
|
Special
2008 Elections
|
7
|
||
4.7
|
Hardship
Withdrawals
|
7
|
||
4.8
|
Death
Benefits
|
8
|
|
||||
Page | ||||
4.9
|
Disability
Benefits
|
8
|
||
4.10
|
Cashout
of Small
Accounts
|
8
|
||
4.11
|
Withholding
|
8
|
||
4.12
|
Tax
Reporting
|
8
|
||
4.13
|
Loans
|
9
|
||
4.14
|
Delayed
Distributions to Key Employees
|
9
|
||
4.15
|
Facility
of Payment
|
9
|
||
4.16
|
Change
in Control
|
9
|
||
ARTICLE
5
|
BENEFICIARIES
|
|||
5.1
|
Beneficiary
Designation
|
11
|
||
5.2
|
Change
in Marital Status; Community Property Rights
|
11
|
||
5.3
|
Default
Beneficiary
|
11
|
||
5.4
|
Effect
of Payment
|
11
|
||
ARTICLE
6
|
PLAN
ADMINISTRATION
|
|||
6.1
|
Committee;
Duties
|
12
|
||
6.2
|
Agents
|
12
|
||
6.3
|
Binding
Effect of Decisions
|
12
|
||
6.4
|
Indemnification
|
12
|
||
ARTICLE
7
|
CLAIMS
PROCEDURE
|
|||
7.1
|
Written
Claims
|
12
|
||
7.2
|
Denial
of Claim
|
12
|
||
7.3
|
Review
of Claim
|
13
|
||
7.4
|
Decision
on Review
|
13
|
||
7.5
|
Exhaustion
of Review Process
|
13
|
||
ARTICLE
8
|
AMENDMENT
AND TERMINATION OF PLAN
|
|||
8.1
|
Amendment
|
13
|
||
8.2
|
Effect
of Termination; Distribution of Accounts
|
14
|
||
ARTICLE
9
|
GENERAL
PROVISIONS
|
|||
9.1
|
Unfunded
Plan
|
15
|
||
9.2
|
Unsecured
General Creditors
|
15
|
||
9.3
|
Nonassignability
|
15
|
||
9.4
|
Not
a Contract of Employment
|
16
|
||
9.5
|
Participant's
Cooperation
|
16
|
||
9.6
|
Expenses
Relating to Enforcing Agreement
|
16
|
||
9.7
|
Interest
on Delinquent Payments
|
16
|
||
9.8
|
Governing
Law
|
17
|
||
9.9
|
Severability
|
17
|
||
9.10
|
Notice
|
17
|
||
9.11
|
Successors
|
17
|
||
SIGNATURE
|
17
|
A.
|
PURPOSE.
The
purpose of this Plan is to assist the Bank in attracting, motivating and
retaining high caliber executive talent for its Board of Directors and its
senior management by:
|
|||
(1) Providing
its Directors and Executive Officers with the opportunity to defer their
fees or compensation on a pre tax and tax-sheltered
basis;
|
||||
(2) Correlating
the earnings credited to the deferred Compensation to the Bank's yield on
assets;
|
||||
(3) Allowing
Participants to receive payment of their deferred funds upon their
Separation from Service or an unexpected financial hardship;
and
|
||||
(4) Upon
a change in control, requiring the deferred funds to be held in a "rabbi
trust" where, although those funds would be subject to the claims of
creditors in the event of the Bank's insolvency, they would be otherwise
dedicated solely to providing benefit payments under the
Plan.
|
||||
B.
|
ERISA
EXEMPTION
.
This is an unfunded plan maintained primarily for
the purpose of providing deferred compensation for a select group of
management or highly compensated employees. As such, this Plan is intended
to qualify as a "top hat plan" exempt from Part 2 (minimum participation
and vesting standards), Part 3 (minimum funding standards) and Part 4
(fiduciary responsibility provisions) of Title I of the Employee
Retirement Income Security Act of 1974. The provisions of the Plan shall
be interpreted and administered according to this
intention.
|
|||
C.
|
EFFECTIVE DATES
.
This
2008 Restatement is a restatement in its entirety of the Riverview
Directors' and Officers' Deferred Compensation Plan, which has effective
dates as follows:
|
|||
(1) The
original plan was adopted December 18, 1986.
|
||||
(2) The
2002 Restatement was effective December 18, 2002.
|
||||
(3) The
Interim Plan Document for Operational Compliance with the American Jobs
Creation Act was effective January 1, 2005, subject to reasonable good
faith interpretations of the requirements of Code 409A and the
applicable interim guidance.
|
||||
(4) This
2008 Restatement is effective December 17, 2008, and is intended to bring
the Plan into compliance with Code 409A and make other changes
to facilitate Plan administration.
|
||||
D.
|
CITATIONS
.
Citations to sections of the Code or Treasury regulations are to those
sections as amended or any successor
provision.
|
|
||||
E.
|
NAMING
CONVENTION
. This Plan document uses the following system for
naming,
numbering and lettering the major divisions in its
text
B
|
|||
ARTICLE
1
|
||||
1.1
Section
.
|
||||
(a) Subsection
|
||||
(1)
Paragraph
|
||||
(A)
Subparagraph.
|
||||
(i)
clause.
|
||||
(I) Subclause.
|
||||
ARTICLE
I
DEFINITIONS
|
||||
Words
and phrases that appear in this Plan with initial capital letters signify
defined terms with the meanings given in this section. Words appearing in
the following definitions which are themselves defined terms are also
indicated by initial capital letters.
|
||||
1.1
|
ACCOUNT
means
the separate bookkeeping account maintained by the Bank under
Article
3 with respect to each Participant to record each Participant's Plan
Benefit.
|
|||
1.2
|
BANK
means
Riverview Community Bank and its holding company.
|
|||
1.3
|
BENEFICIARY
means the person, persons or entity designated by the Participant, or
as
otherwise determined under Article 5, to receive any Plan Benefits payable
after a Participant's death.
|
|||
1.4
|
BOARD
means
the Board of Directors of the Bank.
|
|||
1.5
|
CODE
means
the Internal Revenue Code of 1986, as amended.
|
|||
1.6
|
COMMITTEE
means the Deferred Compensation Committee appointed to
administer
the Plan pursuant to Article 6.
|
|||
1.7
|
COMPENSATION
means.
|
|||
(a) With
respect to a Director -- Board meeting attendance
fees.
|
||||
(b) With
respect to an Executive Officer -- salary, bonuses that are
considered to be "wages" for federal income tax withholding
purposes.
|
|
|
|||
1.8
|
DEFERRAL
ELECTION
means an election by a Participant to defer Compensation
pursuant
to Article 2.
|
|||
1.9
|
DETERMINATION
DATE
means the last day of each calendar month.
|
|||
1.10
|
DIRECTOR
means a member of the Board.
|
|||
1.11
|
DISABLED
or
DISABILITY
means a
Participant is:
|
|||
(a) Unable
to engage in any substantial gainful activity by reason of any medically
determinable physical or mental impairment that can be expected to result
in death or to last for a continuous period of not less than 12
months;
|
||||
(b) By
reason of any medically determinable physical or mental impairment that
can be expected to result in death or to last for a continuous period of
not less than 12 months, receiving income replacement benefits for a
period of not less than 3 months under an accident and health plan
covering employees of the Bank or a Participating Subsidiary;
or
|
||||
(c) Determined
to be totally disabled by the Social Security
Administration.
|
||||
The
Committee, in its sole discretion, shall determine whether a Participant
is Disabled.
|
||||
1.12
|
EXECUTIVE
OFFICER
means any officer at the level of Senior Vice President or
above.
|
|||
1.13
|
INTEREST
means interest computed on a Determination Date at the rate of the Bank's
average yield on assets for the prior calendar year, less one hundred
(100) basis points. The term "yield on assets" shall mean the "total
revenue" as reported on the Bank's Thrift Financial Report or Bank Call
Report, as applicable, for that calendar year divided by the average total
assets of the Bank during that calendar year. For this purpose, "average
total assets" will be determined by taking the average of the Bank's
assets as reported on its Thrift Financial Report or Bank Call Report, as
applicable, as of January 1 of that calendar year and at the end of each
calendar quarter in that same calendar year.
|
|||
1.14
|
PARTICIPANT
means any Director or Executive Officer who elects to participate by
filing a Participation Agreement as provided in Article
2.
|
|||
1.15
|
PARTICIPATING
SUBSIDIARY
means any subsidiary of the Bank except those that
affirmatively
elect not to participate in this Plan.
|
|||
1.16
|
PARTICIPATION
AGREEMENT
means the agreement filed by a Participant prior to the
beginning
of the first period for which the Participant's Compensation is to be
deferred. A new Participation Agreement shall be filed by the Participant
for each separate Deferral Election.
|
|||
1.17
|
PLAN BENEFIT
means the benefit payable to Participants, as determined under Article
4.
|
|||
1.18
|
PLAN YEAR
means the calendar year.
|
|||
1.19
|
SEPARATION FROM
SERVICE
means:
|
|||
(a) With
respect to a Director the date the Director is no longer serving on the
Board.
|
||||
|
(b) With
respect to an Executive Officer the date the Executive Officer is no
longer employed by the Bank or by any Participating
Subsidiary.
|
|
|||
ARTICLE
2
PARTICIPATION
|
|||
2.1
|
PARTICIPATION
.
Participation in the Plan shall be limited to Directors and
Executive
Officers who elect to participate by filing a Participation Agreement with
the Committee or its designee.
|
||
2.2
|
DEFERRAL
ELECTIONS
.
|
||
(a)
Initial Enrollment.
|
|||
(1)
In order to defer Compensation in the first Plan Year that a
Participant becomes eligible to participate in the Plan, the Participant
must file a Participation Agreement no later than thirty (30) days
following notification by the Committee of eligibility to
participate.
|
|||
(2)
Except as provided in paragraph (3) below, the Deferral Election will be
effective only for the Compensation paid for services to be performed
after the date the election is filed.
|
|||
(3)
In the case of bonus Compensation, the Deferral Election will be effective
only for the portion of the bonus paid for services performed after the
date the election is filed. That portion will be determined by
multiplying:
|
|||
(A) The
total bonus payment by the ratio of the number of days remaining in the
bonus measuring period after the election is filed; by
|
|||
(B) The
total number of days in the bonus measuring period.
|
|||
(b) Annual Enrollment. New Deferral Elections shall be made annually by filing a Participation Agreement with the Committee before December 15th (or such other deadline as established by the Committee from time to time) of any Plan Year stating the amount or percentage of Compensation that the Participant elects to have deferred during the upcoming Plan Year. A Participant may elect a schedule of deferral percentages or amounts that will apply at stated times or during stated periods in the coming Plan Year. | |||
(c) Minimum and Maximum Deferral Limits. The minimum deferral for a Plan Year is One Hundred Dollars ($100.00). The maximum deferral for Executive Officers shall be fifty percent (50%) of Compensation otherwise payable to the Participant during the Plan Year. Directors are not subject to a maximum deferral. | |||
2.3
|
MODIFICATION OR
REVOCATION OF DEFERRAL ELECTIONS
.
|
||
(a) Deferral
Election may be modified or revoked at any time up until the applicable
election deadline specified in Section 2.2(b). After that date, the
Deferral Election becomes irrevocable except as provided under subsection
(b) below.
|
|||
(b) A
Participant may cancel a Deferral Election as follows:
|
|||
(1) The
cancellation may be made only upon the following
events:
|
|
||||
(A)
An unforeseeable emergency or a hardship distribution under Section 4.7;
or
|
||||
(B) A
disability (as defined in paragraph (4) below), provided the
cancellation
occurs by the later of:
|
||||
(i) The
end of the calendar year in which the Participant incurs the Disability;
or
|
||||
(ii) The
15th day of the third month following the date the Participant incurs the
Disability.
|
||||
(2) The
deferral election must be cancelled, not merely postponed or otherwise
delayed.
|
||||
(3) Any
later deferral election must be made within the deadline under Section
2.2(b).
|
||||
(4) For
purposes of subsection (b)(1)(B) above, "disability" means any medically
determinable physical or mental impairment resulting in the Participant's
inability to perform the duties of the Participant's position or any
substantially similar and available position, where that impairment can be
expected to result in death or can be expected to last for a continuous
period of at least six months.
|
||||
3.1
|
MAINTENANCE OF
ACCOUNTS
.
An Account shall be maintained for
each Participant for recordkeeping purposes only. The
maintenance of Accounts shall not require the Bank to segregate any of its
assets for the benefit of a Participant except as provided under Section
4.16 (funding a trust upon a change in control). The deferred Compensation
of a Participant, together with accrued Interest, shall be credited to
that Participant's Account. Distributions (including hardship withdrawals
under Section 4.7) shall be debited from that Account.
|
|
3.2
|
ACCOUNT
ADJUSTMENTS
.
Participants' Accounts shall be
adjusted as of each Determination. Date as
follows:
|
|
(a) First,
deducting from the balance of the Account determined as of the
preceding Determination Date the amount of any distributions
made from that Account since the preceding Determination
Date.
|
||
(b) Second,
crediting Interest on the Account balance, as adjusted under subsection
(a) above.
|
||
(c) Third,
crediting any Compensation deferred since the preceding Determination
Date.
|
||
3.3
|
ACCOUNT
STATEMENTS
.
The Committee shall provide each
Participant, within ninety (90) days after the close of each Plan Year and
at such other times as determined by the Committee, a statement setting
forth the balance of that Participant's
Account.
|
4.1
|
AMOUNT
OF BENEFIT
.
The Plan Benefit shall be equal to the balance
of the Participant's Account as of the Determination Date on or before the
date of distribution plus the amount of any Compensation deferred since
that Determination Date.
|
|
4.2
|
TIME OF
PAYMENT
.
|
|
(a) Participants
may elect on their initial Participation Agreement either a specific date
or a fixed schedule of payments starting on a specified date on which
distribution of their Plan Benefit is to be made. If a Participant does
not make such an election, the Participant's Plan Benefit will be
distributed upon the Participant's Separation from
Service.
|
||
(b) Distributions
shall be made in accordance with subsection (a) except as provided in
Section 4.6 (overrides), Section 4.7 (hardship withdrawals), Section 4.8
(death), Section 4.9 (Disability), Section 4.10 (cashout of
small accounts) and Section 4.14 (delayed distributions to key
employees).
|
||
(c) A
Participant may, as allowed under Section 4.5 below and under procedures
established by the Committee, change the time of payment elected under
subsection (a) above.
|
||
(d) Neither
the time nor the schedule of any payment under the Plan may be accelerated
except:
|
||
(1) As
otherwise provided in Section 4.7 (hardship withdrawals), Section 4.8
(death), Section 4.9 (Disability), Section 4.10 (cashout of small
accounts); or
|
||
(2) To
the extent allowed under Treas. Reg. 1.409A-3(j)(4) and
policies and procedures established by the Committee.
|
||
4.3
|
FORM OF
PAYMENT
.
|
|
(a) Participants
may elect on their initial Participation Agreement one of the following
forms of payment for their Plan Benefit:
|
||
(1) A
lump-sum payment (which shall be the default if a Participant fails to
elect a form of payment); or
|
||
(2) Annual
installments in substantially equal payments of principal and Interest
over a period not to exceed ten (10) years.
|
||
(b) A
Participant may, as allowed under Section 4.5 below and under procedures
established by the Committee, change the form of payment elected under
subsection (a) above.
|
4.4
|
OVERRIDES
.
On their
initial Participation Agreements, Participants may also elect one or more
override options as follows:
|
(a)
An override election provides that the time and form of payment elected by
the Participant will be followed unless an override event occurs first. If
it does, the date of the override event will be the date of distribution
and the form of payment will be a lump-sum.
|
||
(b)
Participants may elect either or both of the following as an override
event:
|
||
(1) Separation
from Service; and/or
|
||
(2) "Change
in control" as defined in Treas.
Reg. 1.409A-3(i)(5).
|
||
4.5
|
CHANGES
IN TIME OR FORM OF PAYMENT
.
Participants may change the time
or the form of payment selected for their Plan Benefit upon the following
conditions:
|
|
(a) The
change cannot take effect for at least 12 months after filing the election
change form required by the Committee;
|
||
(b) If
a Participant wants to change the specific date on which a payment is to
be made, the Participant must file the required election change form at
least 12 months in advance of that date; and
|
||
(c) The
Participant must elect to delay the commencement of the payment for at
least five years from the original payment date, except in the case of
death, Disability or a financial hardship withdrawal under Section
4.7(b).
|
||
4.6
|
SPECIAL
2008 ELECTIONS
.
Participants may change their elections as
to the time and form of payment of their Plan Benefit and elect an
override option under Section 4.4 without regard to the deadlines in
Sections 4.2, 4.3 and 4.4 or the rules of Section 4.5 provided they file
their new elections no later than December 31, 2008 (or such earlier
deadline as established by the Committee).
|
|
4.7
|
HARDSHIP
WITHDRAWALS
.
|
|
(a) A
Participant may apply to the Committee for a withdrawal to meet a
financial hardship (as defined in subsection (b) below). If the
application is approved, the withdrawal will be effective at the later of
the date specified in the Participant's application or the date of
approval. The approved amount shall be payable in a lump
sum.
|
||
(b) A
"financial hardship" is an unforeseeable financial emergency resulting
from:
|
||
(1) An
illness or accident of the Participant, or the Participant's spouse or
dependent (as defined in Code 152, without regard
to 152(b)(1), (b)(2) and (d)(1)(B));
|
||
(2) Medical
expenses (as defined in Code 213(d)) of the Participant, the
Participant's spouse or the Participant's dependent (as defined in
paragraph (1) above), including prescription drug
expenses;
|
||
(3) A
property casualty loss incurred by the Participant (including the need to
rebuild a home following damage not otherwise covered by
insurance);
|
|
||
(4) Funeral
expenses of a spouse, a Beneficiary or a dependent (as defined in
paragraph (1) above); or
|
||
(5) A
similar extraordinary and unforeseeable circumstance caused by events
beyond the Participant's control.
|
||
The
circumstances that constitute a financial hardship depend upon the facts
of each case, but, in general, the purchase of a home or the payment of
college tuition is not an unforeseeable emergency.
|
||
(c) A
withdrawal cannot exceed the amount necessary to meet the financial
hardship (including any amounts necessary to pay any federal, state, local
or foreign income taxes or penalties reasonably anticipated to result from
the distribution). In making this determination, the Committee does not
need to conduct an independent investigation but may reasonably rely on
the Participant's written representations that the financial hardship
cannot be relieved by:
|
||
(1) Reimbursement
or compensation by insurance or otherwise;
|
||
(2) Liquidating
the Participant's assets, to the extent the liquidation of those assets
would not cause a severe financial hardship; or
|
||
(3) Cancelling
deferrals under this Plan.
|
||
(d) If
a Participant takes a financial hardship withdrawal, the Participant's
Account shall be appropriately reduced to reflect the amount
withdrawn.
|
||
(e) Hardship
withdrawals may not be repaid.
|
||
(f) Hardship
withdrawals shall be treated as taxable distributions from the
Plan.
|
||
4.8
|
DEATH
BENEFITS
.
Upon a Participant's death, the unpaid balance of
the Participant's Plan Benefit shall be paid to the Participant's
Beneficiary in a lump sum as soon as administratively feasible following
the date of death.
|
|
4.9
|
DISABILITY BENEFITS
.
The
unpaid balance of a Participant's Plan Benefit shall be paid to the
Participant in a lump sum as soon as administratively feasible following
the date the Participant is determined to be Disabled.
|
|
4.10
|
CASHOUT OF SMALL
ACCOUNTS
.
Regardless of the time or form of payment elected
by a Participant, the Committee, in its sole discretion, may at any time
distribute the balance or the unpaid balance of the Participant's Plan
Benefit in a lump-sum payment provided that the amount of the Plan Benefit
(taking into account all plans that are required to be aggregated with
this Plan under Treas. Reg. 1.409A-1(c)(2)) does not exceed the
dollar limit under Code 402(g) on 401(k) plan elective deferrals for the
year in which the cashout distribution is made.
|
|
4.11
|
WITHHOLDING
.
All federal,
state and local taxes required to be withheld from deferred Compensation
paid to employees shall be withheld from benefit payments made under this
Plan to or with respect to Participants who are Executive
Officers.
|
|
4.12
|
TAX
REPORTING
.
The Trustee shall furnish Participants or
Beneficiaries with the appropriate tax form or forms reporting the amount
of the payments made to them.
|
4.13
|
LOANS
.
Participants shall
not be permitted to borrow from their Accounts.
|
||
4.14
|
DELAYED
DISTRIBUTIONS TO KEY EMPLOYEES
.
The following provisions
apply to a distribution made on account of a key employee's separation
from service, except to the extent the distribution is exempt under
subsection (d) below:
|
||
(a) The
distribution shall not be made before the date which is six months after
the date of the key employee's separation from service or, if earlier, the
date of the key employee's death.
|
|||
(b) If
the key employee would have otherwise received installment payments during
the six-month delay period, the Committee, in its sole discretion, shall
determine whether the payments that would otherwise have been made during
the six-month delay period will be paid in a lump sum on the first day of
the seventh month following the key employee's separation from service or
whether the commencement date of the installment payment period will be
delayed by six months.
|
|||
(c) The
following defmitions apply for purposes of this
section:
|
|||
(1) "Key
employee" as defined in Code 416(i).
|
|||
(2) "Separation
from service" as defined in Treas.
Reg. 1.409A-1(h).
|
|||
(d) This
section does not apply to the extent the distribution is exempt from the
requirements of Code 409A or is a payment excepted from the
six-month delay rule under Treas.
Reg. 1.409A-3(i)(2)(i).
|
|||
4.15
|
FACILITY OF PAYMENT
.
If a
Plan Benefit is payable to a minor, a person declared incompetent or a
person incapable of handling the disposition of his or her property, the
Committee may direct payment of that Plan Benefit to the guardian, legal
representative or other person having the care and custody of that person.
The Committee may require appropriate indemnification and proof of
incompetency, minority, incapacity or guardianship as it may deem
appropriate before distributing the Plan Benefit. Such a distribution
shall completely discharge the Committee and the Bank or the Participating
Subsidiary from all liability with respect to that Plan
Benefit.
|
||
4.16
|
CHANGE
IN CONTROL
.
The following provisions will apply upon the
occurrence of a potential change in control or a change in
control:
|
||
(a) Upon
the earlier of a potential change in control or a change in control, the
Bank shall, as soon as possible, but not later than 60 days following the
date of that potential change or change, establish a trust (the "Trust")
with an institutional trustee (the "Trustee"). This Trust shall be
structured and operated as a grantor trust (a so-called "rabbi trust") so
that:
|
|||
(1) The
Trust's assets shall be subject to the claims of the Bank's general
unsecured creditors in the event of the Bank's insolvency until such time
as those assets are paid to Participants and Beneficiaries in such manner
and at such times as specified in this Plan;
|
|||
(2) The
Trust will not affect the status of the Plan as a "top hat" plan for
purposes of Title I of the Employee Retirement Income Security Act of
1974; and
|
|||
(3) Participants
and Beneficiaries do not realize current income on amounts contributed to
the Trust.
|
|
|||
(b) Upon
a change in control, the Bank shall, as soon as possible, but not later
than 60 days after that change, make an irrevocable contribution to the
Trust in an amount equal to the balance of the Participants' Accounts as
determined under Section 3.2 as of the Determination Date that is on or
immediately before the date the contribution is remitted to the
Trustee.
|
|||
(c) Within
60 days after the close of each Plan Year after a change in control has
occurred, the Bank shall irrevocably deposit such additional cash or other
property acceptable to the Trustee as may be required for the total value
of the Trust's assets, less the accrued Trustee's fees and other
operational costs determined as of the close of the Plan Year, to be no
less than the total value of the Participants' Accounts determined under
Section 3.2 as of the close of the Plan Year.
|
|||
(d) For
purposes of this section, the following definitions
apply:
|
|||
(1) "Change
in control" means:
|
|||
(A) An
offeror other than the Bank has purchased shares of the stock of the Bank
pursuant to a tender or exchange offer for those
shares;
|
|||
(B) A
person has become the beneficial owner, directly or indirectly, of
securities of the Bank representing twenty-five percent (25%) or more of
the combined voting power of the Bank's then outstanding
securities;
|
|||
(C) The
membership of the Board has changed as the result of a contested election,
so that individuals who were Directors at the beginning of any twenty-four
(24-) month period (whether commencing before or after the date of
adoption of this 2008 Restatement) do not constitute a majority of the
Board at the end of that period; or
|
|||
(D) Shareholders
of the Bank have approved a merger, consolidation, sale or disposition of
all or substantially all of the Bank's assets, or a plan of partial or
complete liquidation.
|
|||
(2) "Person"
has the same meaning as defined in Sections 13(d) and 14(d)(2) of the
Securities Exchange Act of 1934.
|
|||
(3)"Potential
change in control" means.
|
|||
(A) Any
person, including the Bank, has announced (including filing any report or
statement required under applicable securities or banking law) an
intention to take actions which, if concluded, would constitute a change
in control of either the Bank, or the Board becomes aware that such a
public announcement is imminent;
|
|||
(B) Any
person, including the Bank, has entered into an arrangement or agreement
which, if concluded, would constitute a change in control with respect to
the Bank; or
|
|||
(C) The
Board of Directors of the Bank approves a proposal which, if concluded,
would constitute a change in control with respect to the
Bank.
|
5.1
|
BENEFICIARY
DESIGNATION
.
|
|
(a) Each
Participant shall have the right, at any time, to designate any person or
persons as the Participant's Beneficiary or Beneficiaries to whom payment
under this Plan shall be made if the Participant dies before complete
distribution of the Participant's Plan Benefit.
|
||
(b) A
Beneficiary designation may be changed by a Participant by filing that
change on a form prescribed by the Committee. The filing of a new
Beneficiary designation form will cancel all Beneficiary designations
previously filed.
|
||
(c) A
Beneficiary designation form will be effective upon its receipt by the
Committee, provided it is received before the Participant's
death.
|
||
5.2
|
CHANGE IN MARITAL STATUS; COMMUNITY
PROPERTY RIGHTS
.
|
|
(a) Any
finalized divorce or marriage (other than a common law marriage) of a
Participant subsequent to the date a Beneficiary designation form is filed
with the Committee shall revoke that designation.
|
||
(b) If
a Participant's Compensation is community property, a Beneficiary
designation made by a married Participant shall not be effective unless
either:
|
||
(1) The
Participant's spouse is named as the Beneficiary of at least fifty percent
(50%) of the Participant's Plan Benefit; or
|
||
(2) The
Participant's spouse gives written consent to that Beneficiary
designation.
|
||
5.3
|
DEFAULT
BENEFICIARY
.
If a Participant fails to duly designate a
Beneficiary, a Beneficiary designation is revoked by marriage, divorce or
otherwise without the Participant duly filing a new designation, or if all
designated Beneficiaries predecease the Participant, then the
Participant's designated Beneficiary shall be deemed to be the person or
persons surviving the Participant in the first of the following classes in
which there is a survivor:
|
|
(a) The
surviving spouse;
|
||
(b) The
Participant's children in equal shares, except that if any of the children
predecease the Participant but leave issue surviving, then such issue
shall take by right of representation the share their parent would have
taken if living; and
|
||
(c) The
Participant's estate.
|
||
5
.
4
|
EFFECT
OF PAYMENT
.
The payment to the designated or default
Beneficiary(ies) shall completely discharge the Bank's or the
Participating Subsidiary's obligations under this Plan with respect to the
deceased Participant.
|
6.1
|
COMMITTEE;
DUTIES
.
|
|
(a) This
Plan shall be administered by a Deferred Compensation Committee which
shall consist of not more than three (3) persons appointed by the Board.
Members of the Committee may be Participants under this
Plan.
|
||
(b) In
addition to the authority granted elsewhere in this Plan document, the
Committee shall
have
the authority to:
|
||
(1) Make,
amend, interpret and enforce any rules and regulations it deems
appropriate for the administration of this Plan; and
|
||
(2) Decide
or resolve any and all questions including interpretations of this Plan,
as may arise in connection with the Plan.
|
||
6.2
|
AGENTS
.
In
the administration of this Plan, the Committee may, from time to time,
employ agents and delegate to them such administrative duties as it deems
advisable and may from time to time consult with counsel who may be
counsel to the Bank.
|
|
6.3
|
BINDING
EFFECT OF DECISIONS
.
The decision or action of the
Committee in respect of any question arising out of or in connection with
the administration, interpretation and application of the Plan and the
rules and regulations revised by the Committee shall be final and
conclusive and binding upon all persons having any interest in the
Plan.
|
|
6.4
|
INDEMNIFICATION
.
The Bank shall indemnify and hold harmless the members of the Committee
against any and all claims, loss, damage, expense or liability arising
from any action or failure to act with respect to this Plan (including
fines, penalties and punitive or exemplary damages and attorneys' fees,
including those incurred in connection with enforcing their
indemnification rights under this section), except in the case of gross
negligence or willful misconduct by a Committee
member.
|
7.1
|
WRITTEN
CLAIMS
.
Any person claiming a benefit,
requesting an interpretation or ruling under the Plan or requesting
information under the Plan shall present the request in writing to the
Committee, which shall respond in writing as soon as
practicable.
|
|
7.2
|
DENIAL
OF CLAIM
.
If the claim or request is denied, the
written notice of denial shall state:
|
|
(a) The
reasons for denial, with specific reference to the Plan provisions on
which the denial is based.
|
(b)
A description of any additional material or information required and an
explanation of why it is necessary.
|
||
(c)
An explanation of the Plan's claim review procedure.
|
||
7.3
|
REVIEW
OF CLAIM
.
Any person whose claim or request is
denied or who has not received a response within thirty (30) days may
request review by giving written notice to the Committee. The
claim or request shall be reviewed by the Committee who may, but shall not
be required to, grant the claimant a hearing. On review, the claimant may
have representation, examine pertinent documents and submit issues and
comments in writing.
|
|
7.4
|
DECISION ON
REVIEW
.
The decision on review shall normally be
made within sixty (60) days. If an extension of time is
required for a hearing or other special circumstances, the claimant shall
be notified and the time limit shall be one hundred twenty (120) days. The
decision shall be in writing and shall state the reasons and the relevant
Plan provisions.
|
|
7.5
|
EXHAUSTION OF REVIEW
PROCESS
. Claimants are required to exhaust this claims
and claims review process before instituting any litigation against the
Bank or a Participating Subsidiary.
|
8.1
|
AMENDMENT
.
|
||
(a)
Board's Authority.
The Board may at
any time amend the Plan in whole or in part, provided, however, that no
amendment shall:
|
|||
(1) Directly
or indirectly reduce the balance of any Participant's Account as of the
effective date of that amendment, including any amounts that are to be
credited as of that date;
|
|||
(2) Result
in the acceleration of the payment of any Plan Benefit except to the
extent permissible under Code 409A; or
|
|||
(3) Make
any substantive change to the definition of "Interest" unless
either:
|
|||
(A)
All of the Participants with Deferral Elections in effect at the time the
change is adopted consent in writing to the change; or
|
|||
(B)
If that consent is not obtained, then any change to the definition of
Interest shall not become effective until the first day of the Plan Year
which follows the adoption of the amendment provided Participants are
given written notice at least thirty (30) days before the beginning of the
Plan Year that the change is to be
effective.
|
(b)
Committee's Authority.
|
||||
(1) Subject
to paragraph (2) below, the Committee may adopt any technical, clerical,
conforming or clarifying amendment or other change, either prospectively
or retroactively, which may be necessary or desirable
to:
|
||||
(A) Facilitate
the administration of the Plan;
|
||||
(B) Clarify
or simplify the Plan; or
|
||||
(C) Upon
the advice of counsel:
|
||||
(i)
Maintain the Plan's status as a "top hat" plan for purposes of ERISA;
or
|
||||
(ii) Comply
with other applicable laws.
|
||||
(2) Any
formal amendment adopted by the Committee shall be in writing, signed by
or on behalf of the Committee and reported to the Board at its next
scheduled meeting.
|
||||
8.2
|
EFFECT
OF TERMINATION; DISTRIBUTION OF ACCOUNTS
.
Upon
the termination of the Plan:
|
|||
(a) No
additional Compensation may be deferred under this
Plan.
|
||||
(b) Participants'
Accounts shall be distributed as follows
|
||||
(1)
If a trust has been created under Section 4.16, the Accounts will continue
to be held by the Trustee under the terms and conditions of the Trust and
shall be disbursed at the time and in the manner provided in this
Plan.
|
||||
(2)
Otherwise, the Accounts will be distributed, in the sole discretion of the
Board, under one of the following methods:
|
||||
(A) The
Accounts will be paid out in full within 24 months of the effective date
of the termination of the Plan regardless of the elections Participants
had made regarding the time and form of payment of their Accounts,
provided:
|
||||
(i)
The termination of the Plan does not occur proximate to a downturn in the
Bank's financial health;
|
||||
(ii) The
Bank terminates and liquidates all other plans or other arrangements that
are required to be aggregated with this Plan under Treas.
Reg. 1.409A-1(c) if any Participant under this Plan also has
deferred compensation payable under those other plans or other
arrangements;
|
||||
(iii)
No payments in liquidation are made within 12 months of the effective date
of the termination of the Plan, other than payments that would be payable
under the Plan if termination had not occurred;
and
|
(iv) Within
three years following the effective date of the termination of this Plan,
the Bank does not adopt a new plan that would be aggregated with this Plan
under Treas. Reg. 1.409A-1(c) if any Participant in this Plan
participated in both.
|
||||
(B) The
Accounts will be distributed in a lump-sum payment as soon as
administratively feasible, but only if:
|
||||
(i) The
Plan termination is made within 12 months of a corporate dissolution under
Code 331 or with the approval of a bankruptcy court;
or
|
||||
(ii) If
the Plan termination is made in connection with a change in control event
(as defined in Treas. Reg. 1.409A-3(i)(5)) and the requirements
of Treas. Reg. 1.409A 3(j)(ix)(B) for accelerated distributions
are satisfied.
|
9.1
|
UNFUNDED
PLAN
.
This Plan is intended to be an unfunded
plan maintained primarily to provide deferred Compensation benefits for a
"select group of key management employees or highly compensated employees"
as that phrase is defined for purposes of ERISA.
|
|
9.2
|
UNSECURED GENERAL
CREDITORS
.
Participants and their Beneficiaries,
heirs, successors and assigns shall have no legal or equitable
rights, interest or claims in any property or assets of the Bank or its
Participating Subsidiaries, nor shall they have any rights, claims or
interests in any life insurance policies, annuity contracts or the
proceeds of such policies or contracts that may be owned or acquired by
the Bank or a Participating Subsidiary as a source of financing for its
obligations under this Plan ("Policies"). Except as provided under Section
4.16, such Policies or other assets of the Bank or its Participating
Subsidiaries shall not be held under any trust for the benefit of
Participants, their Beneficiaries, heirs, successors or assigns, or held
in any way as collateral security for fulfilling the obligations of the
Bank and its Participating Subsidiaries under this Plan. Any and all of
the assets and Policies of the Bank and its Participating Subsidiaries
shall be and remain their general unrestricted assets. The
obligations of the Bank and its Participating Subsidiaries under the Plan
shall be that of an unfunded and unsecured promise to pay money in the
future.
|
|
9.3
|
NONASSIGNABILITY
.
Neither a Participant nor any other person shall have any right to sell,
assign, transfer, pledge, anticipate, mortgage or otherwise encumber,
transfer, hypothecate or convey in advance of actual receipt the amounts,
if any, payable under this Plan. A Participant's rights to payment under
this Plan are expressly declared to be unassignable and nontransferable.
No part of the amounts payable shall, prior to actual payment, be subject
to seizure or sequestration for the payment of any debts, judgments,
alimony or separate maintenance owed by a Participant or any other person,
nor be transferable by operation of law in the event of a Participant's or
any other person's bankruptcy or
insolvency.
|
9.4
|
NOT A
CONTRACT OF EMPLOYMENT
.
The terms and conditions
of this Plan shall not be deemed to constitute a contract of employment
between the Bank or any of its Participating Subsidiaries and the
Participant, and the Participant (or the Participant's Beneficiary) shall
have no rights against the Bank or any of its Participating Subsidiaries
except as may otherwise be specifically provided in this Plan. Moreover,
nothing in this Plan shall be deemed to give a Participant the
right to be retained in the service of the Bank or any of its
Participating Subsidiaries or to interfere with the right of the Bank or
its applicable subsidiary to discipline or discharge the Participant at
any time.
|
|
9.5
|
PARTICIPANT'S
COOPERATION
.
As a condition of participation, a Participant
shall permit the issuance of life insurance contracts on the Participant's
life, shall furnish any and all information requested by the Bank, shall
take such physical examinations as the Bank may deem necessary, and shall
take such other action as may be requested by the Bank to facilitate the
operation of this Plan. The Committee shall not be required to accept a
Deferral Election by any Participant until the Participant has satisfied
the underwriting requirements of a designated life insurance company. No
death benefits in excess of the balance of the Account shall be paid with
respect to any Participant.
|
|
9.6
|
EXPENSES RELATING TO ENFORCING
AGREEMENT
.
|
|
(a) If
a Participant incurs legal or other fees or expenses in an effort to
secure, preserve or establish entitlement to compensation or benefits
under this Plan or enforce any other provision of this Plan, the Bank
shall, regardless of the outcome of those efforts, pay on behalf of, or
reimburse the Participant for the reasonable fees and expenses
incurred.
|
||
(b) The
Bank shall also pay the Participant a "double" tax gross-up payment with
respect to the taxes payable by the Participant on the payment or
reimbursement under subsection (a) above (that is, the payment shall be
sufficient to pay the tax on the gross-up payment
itself).
|
||
(c) If
the Participant does not prevail (after exhaustion of all available
judicial remedies) on the claim and the Bank establishes in a court of
competent jurisdiction, by clear and convincing evidence, that the
Participant had no reasonable basis for the claim or acted in bad faith,
then the Bank shall have no further obligation to reimburse the
Participant for legal fees and expenses with regard to that claim, and the
Participant shall refund any amounts previously reimbursed by the Bank
with respect to that claim.
|
||
(d) The
Bank shall pay on behalf of, or reimburse the Participant for fees and
expenses under this section as they are incurred within 10 days after the
Participant submits a request for payment or reimbursement accompanied by
evidence that the fees and expenses were incurred.
|
||
9.7
|
INTEREST ON
DELINQUENT PAYMENTS
. If the Bank or a Participating Subsidiary
fails to pay a Participant or Beneficiary any amount provided under this
Plan when due, the delinquent payment shall accrue interest, compounded
daily, at a rate equal to the greater of:
|
|
(a) The
Plan's rate of Interest; or
|
||
(b) 200
basis points over the prime commercial lending rate announced by the Bank
on the date the delinquent amount was due or, if no such rate is announced
on that date, the nearest prior date on which the Bank announced that
rate.
|
9.8
|
GOVERNING LAW
.
The
provisions of this Plan shall be construed and interpreted according to
the laws of the State of Washington to the extent not preempted by federal
law.
|
|
9.9
|
SEVERABILITY
.
If any
provision of this Plan shall be held illegal or invalid for any reason,
that illegality or invalidity shall not affect the Plan's remaining
provisions, and the Plan shall be construed and enforced by disregarding
that illegal or invalid provision.
|
|
9.10
|
NOTICE
.
Notices shall be
given as follows:
|
|
(a) Notices
to the Bank or the Committee must be addressed to the Bank's principal
office. Any notice or administrative form required to be
filed with the Committee by or on behalf of a Participant, Beneficiary or
other distributee of a Participant's Account must be actually received by
the Committee, and not simply mailed by the sender, to be effective. That
is, this Plan does not follow the common law "mailbox rule" with respect
to these types of communications.
|
||
(b) Notices
to Participants, Beneficiaries and other distributees of a Participant's
Account must be addressed to their last address as shown in the Bank's
records. The Plan follows the common law "mailbox rule" with respect to
such notices.
|
||
9.11
|
SUCCESSORS
.
The provisions of this Plan shall bind and inure to the benefit of the
Bank, its Participating Subsidiaries, the Participants and their
respective heirs, personal representatives, successors and
assigns. The term successors shall include any corporate or other business
entity which shall, whether by merger, consolidation, purchase or
otherwise acquire all or substantially all of the business and assets of
the Bank or any of its Participating Subsidiaries, and the successors of
any such corporation or other business entity. The Bank and its
Participating Subsidiaries agree that any agreement they
enter into for their merger, consolidation or sale or the sale
of all or substantially all of their assets shall require the acquirer,
surviving entity or buyer to assume this Plan as the successor
employer.
|
RIVERVIEW
COMMUNITY BANK
|
||
By:_______________________________
|
||
Ronald
A. Wysaske
|
||
President
and COO
|
||
Dated:
December 17, 2008
|
1.
|
I
have reviewed this Annual Report on Form 10-K of Riverview Bancorp,
Inc.;
|
2.
|
Based
on my knowledge, this report does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this
report;
|
3.
|
Based
on my knowledge, the financial statements, and other financial information
included in this report, fairly present in all material respects the
financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this
report;
|
4.
|
The
registrant’s other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal
control over financial reporting (as defined in Exchange Act Rules
13a-15(f) and 15d-15(f)) for the registrant and
have:
|
a)
|
designed
such disclosure controls and procedures, or caused such disclosure
controls and procedures to be designed under our supervision, to ensure
that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this annual report is
being prepared;
|
b)
|
designed
such internal control over financial reporting, or caused such internal
control over financial reporting to be designed under our supervision, to
provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting
principles;
|
c)
|
evaluated
the effectiveness of the registrant’s disclosure controls and procedures
and presented in this report our conclusions about the effectiveness of
the disclosure controls and procedures, as of the end of the period
covered by this report based on such evaluation;
and
|
d)
|
disclosed
in this report any change in the registrant’s internal control over
financial reporting that occurred during the registrant’s most recent
fiscal quarter (the registrant’s fiscal fourth quarter in the case of an
annual report) that has materially affected, or is reasonably likely to
materially affect, the registrant’s internal control over financial
reporting; and
|
5.
|
The
registrant’s other certifying officers and I have disclosed, based on our
most recent evaluation of internal control over financial reporting, to
the registrant’s auditors and the audit committee of registrant’s board of
directors (or persons performing the equivalent
functions):
|
a)
|
all
significant deficiencies and material weakness in the design or operation
of internal control over financial reporting which are reasonably likely
to adversely affect the registrant’s ability to record, process, summarize
and report financial data information;
and
|
b)
|
any
fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant’s internal control
over financial reporting.
|
1.
|
I
have reviewed this Annual Report on Form 10-K of Riverview Bancorp,
Inc.;
|
2.
|
Based
on my knowledge, this report does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this
report;
|
3.
|
Based
on my knowledge, the financial statements, and other financial information
included in this report, fairly present in all material respects the
financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this
report;
|
4.
|
The
registrant’s other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal
control over financial reporting (as defined in Exchange Act Rules
13a-15(f) and 15d-15(f)) for the registrant and
have:
|
a)
|
designed
such disclosure controls and procedures, or caused such disclosure
controls and procedures to be designed under our supervision, to ensure
that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this annual report is
being prepared;
|
b)
|
designed
such internal control over financial reporting, or caused such internal
control over financial reporting to be designed under our supervision, to
provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting
principles;
|
c)
|
evaluated
the effectiveness of the registrant’s disclosure controls and procedures
and presented in this report our conclusions about the effectiveness of
the disclosure controls and procedures, as of the end of the period
covered by this report based on such evaluation;
and
|
d)
|
disclosed
in this report any change in the registrant’s internal control over
financial reporting that occurred during the registrant’s most recent
fiscal quarter (the registrant’s fiscal fourth quarter in the case of an
annual report) that has materially affected, or is reasonably likely to
materially affect, the registrant’s internal control over financial
reporting; and
|
5.
|
The
registrant’s other certifying officers and I have disclosed, based on our
most recent evaluation of internal control over financial reporting, to
the registrant’s auditors and the audit committee of registrant’s board of
directors (or persons performing the equivalent
function):
|
a)
|
all
significant deficiencies and material weakness in the design or operation
of internal control over financial reporting which are reasonably likely
to adversely affect the registrant’s ability to record, process, summarize
and report financial data information;
and
|
d)
|
any
fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant’s internal control
over financial reporting.
|
1.
|
the
report fully complies with the requirements of Sections 13(a) or 15(d) of
the Securities Exchange Act of 1934, as amended,
and
|
2.
|
the
information contained in the report fairly presents, in all material
respects, the Company’s financial condition and results of operations as
of the dates and for the periods presented in the financial statements
included in such report.
|
/S/ Patrick Sheaffer
|
/S/ Kevin J.
Lycklama
|