Riverview Bancorp, Inc. Earns $2.4 Million in Fiscal Second Quarter, Core Deposits Increase 11 Percent and Strong Credit Quality Continues


VANCOUVER, Wash., Oct. 23, 2007 (PRIME NEWSWIRE) -- Riverview Bancorp, Inc. (Nasdaq:RVSB) today reported that strong core deposit growth and continued excellent credit quality contributed to fiscal second quarter 2008 earnings. For the quarter ended September 30, 2007, net income was $2.4 million, or $0.22 per diluted share, compared to the record earnings of $3.0 million, or $0.26 per diluted share, posted in the second quarter of fiscal 2007. For the first six months of fiscal 2008, net income was $5.3 million, or $0.47 per diluted share, compared to $5.6 million, or $0.49 per diluted share, in the first six months of fiscal 2007. All per share data has been adjusted to reflect the August 2006 2-for-1 stock split.

"While our second quarter profits were below last year's record setting earnings, they reflect the very strong franchise we are building in the healthy Southwestern Washington and metropolitan Portland, Oregon markets," stated Pat Sheaffer, Chairman and CEO. "Leveraging our reputation as a provider of premier customer service has helped us gather low cost deposits and utilize them to fund our healthy and growing loan portfolio."

Second Quarter Fiscal 2008 Highlights (at or for the period ended September 30, 2007, compared to September 30, 2006)



 * Net income was $2.4 million, or $0.22 per diluted share.
 * Asset quality remains excellent -- Non-performing assets are just
   0.03% of total assets.
 * Core deposits increased 11%.
 * Net interest margin was 4.72%.
 * Riverview Asset Management Corp. increased assets under management
   9.6% to $302.9 million.
 * Asset management fees increased 12.7% to $513,000.

Operating Results

For the second quarter of fiscal 2008, the net interest margin was 4.72% compared to 4.83% in the previous linked quarter and 4.97% in the second fiscal quarter a year ago. For the first six months of fiscal 2008, the net interest margin was 4.78% compared to 5.10% in the first half of fiscal 2007. "The yield curve remained a challenge for us as well as the entire banking industry. We expect improved spreads in light of the recent Federal Reserve rate cut, and anticipate our margin will stabilize or improve as we see the effect of our interest bearing deposits re-price," said Ron Wysaske, President and COO.

Reflecting the impact of the increase in funding costs, net interest income in the second fiscal quarter of 2008 decreased to $8.7 million compared to $9.1 million in the second fiscal quarter a year ago. For the first six months of fiscal 2008, net interest income was $17.5 million, compared to $18.1 million in the first six months of fiscal 2007. Non-interest income was down slightly to $2.2 million for the quarter, compared to $2.3 million a year ago, primarily due to lower mortgage broker loan fees that are included in fees and service charges. However, for the first six months of fiscal 2008, non-interest income increased 3% to $4.5 million compared to $4.4 million for the first six months a year ago, largely due to fee income from Riverview Asset Management Corp., which increased 19% to $1.1 million during the first half of fiscal 2008.

Non-interest expenses were $6.8 million in the second quarter of fiscal 2008, unchanged from the previous linked quarter and an increase from $6.3 million in the second quarter of fiscal 2007. The efficiency ratio was 62.61% for the second quarter, compared to 54.93% in the second quarter a year ago and 61.76% for the first six months of fiscal 2008, compared to 57.84% for the same period a year ago. "We have increased our infrastructure to accommodate expanding our franchise in Southwest Washington and into Oregon in the last six months," said Wysaske. "We expect our efficiency ratio to return to more normalized levels in the second half of the year."

Riverview's return on average assets was 1.19% for the second quarter and 1.29% year-to-date, compared to 1.45% and 1.41% for the respective periods last year. Return on average equity was 9.98% for the quarter and 10.58% for the first six months of fiscal 2008, compared to 12.22% and 11.70%, respectively, for the same periods last year.

Balance Sheet Growth

"In spite of a very competitive market for deposits, we have been successful at growing core deposits to fund our loan growth," Wysaske said. "Non-interest checking balances represent 13% of total deposits and interest checking balances represent 20% of total deposits." Total deposits were $660 million at the end of September 2007 compared to $640 million at the end of September 2006. Core deposits, defined as all deposits excluding certificates of deposit, increased 11% over the past year to $480 million, and represent 73% of total deposits. The following table breaks out deposits by category:



                 At the six months ended           At the year
                      September 30,               ended March 31,
                 2007               2006               2007
                 ----               ----               ----
                            (Dollars in thousands)
 DEPOSIT DATA
 ------------
 Interest
  checking     $132,340    20.06% $153,631    23.99% $144,451    21.71%
 Regular
  savings        27,408     4.15%   32,896     5.14%   29,472     4.43%
 Money market
  deposit
  accounts      235,091    35.63%  145,612    22.74%  205,007    30.81%
 Non-interest
  checking       85,492    12.96%  101,852    15.90%   86,601    13.01%
 Certificates
  of deposit    179,454    27.20%  206,413    32.23%  199,874    30.04%
             ---------------------------------------------------------
 Total
  deposits     $659,785   100.00% $640,404   100.00% $665,405   100.00%
             =========================================================

Total assets were $821 million at the end of September 2007, compared to $844 million a year ago.

"During the current quarter we saw our loan growth improve," Wysaske said. "Growth in the loan portfolio will drive revenue growth." Net loans at September 30, 2007 grew 3.6% over the linked June 2007 quarter end. "As our loan portfolio grows, our goal is to keep it well-diversified and maintain our excellent credit quality. Loan growth and excellent credit quality should drive revenue growth going forward," stated Wysaske. Net loans were $687 million at September 30, 2007, compared to $691 million a year ago. Commercial and construction loans account for 89% of the total loan portfolio, similar to last year. The following table breaks out loans by category:



                                        At the            At the
                                    quarter ended      quarter ended
                                     September 30,      September 30,
                                        2007               2006
                                        ----               ----
                                         (Dollars in thousands)
 LOAN DATA (1)
 ------------
 Commercial and construction
   Commercial                     $ 90,515    13.00% $ 95,689    13.69%
   Other real estate mortgage      367,380    52.75%  360,756    51.62%
   Real estate construction        162,429    23.32%  166,233    23.78%
                                 ------------------ ------------------
    Total commercial and
     construction                  620,324    89.07%  622,678    89.09%

 Consumer
   Real estate one-to-four
    family                          71,725    10.30%   72,319    10.35%
   Other installment                 4,432     0.63%    3,916     0.56%
                                 ------------------ ------------------
     Total consumer                 76,157    10.93%   76,235    10.91%
                                 ------------------ ------------------
 Total loans                      $696,481   100.00% $698,913   100.00%
                                 ================== ==================
 (1) Certain prior period loan balances have been reclassified to
     conform to management's current year presentation.

Shareholders' Equity

Shareholders' equity was $92.6 million, compared to $95.8 million a year ago. Book value per share improved to $8.42 at the end of September 2007, compared to $8.28 a year earlier, and tangible book value per share improved to $6.01 at quarter-end, compared to $5.97 a year ago. During fiscal 2008, 775,000 shares have been purchased on the open market under the announced Repurchase Plans. Under the current Repurchase Plan announced June 21, 2007, there are 225,000 shares remaining to be purchased. Riverview remains a well-capitalized institution.

Credit Quality and Performance Measures

"Our lending team has done an excellent job at maintaining loan quality," noted Wysaske. "We continue to keep a watchful eye on industry and regional trends and closely monitor credit risk." Riverview has no sub-prime residential real estate loans in portfolio. Non-performing assets were $206,000, or 0.03% of total assets, at September 30, 2007, compared to $1.7 million, or 0.20% of total assets, at September 30, 2006. The allowance for loan losses, including unfunded loan commitments of $422,000, was $9.5 million, or 1.36% of net loans at quarter-end, compared to $8.6 million, or 1.24% of net loans, a year ago.

Conference Call

The management team of Riverview Bancorp, Inc. will host a conference call on Wednesday, October 24, at 8:00 a.m. PDT, to discuss the second quarter results. The conference call can be accessed live by telephone at 303-262-2211. To listen to the call online go the "About Riverview" page of Riverview's website at www.riverviewbank.com.

About the Company

Riverview Bancorp, Inc. (www.riverviewbank.com) is headquartered in Vancouver, Washington -- just north of Portland, Oregon on the I-5 corridor. With assets of $821 million, it is the parent company of the 84 year-old Riverview Community Bank, as well as Riverview Mortgage and Riverview Asset Management Corp. There are 18 branches, including ten in fast growing Clark County, three in the Portland metropolitan area and three lending centers. The Bank offers true community banking services, focusing on providing the highest quality service and financial products to commercial and retail customers.

Statements concerning future performance, developments or events, concerning expectations for growth and market forecasts, and any other guidance on future periods, constitute forward-looking statements, which are subject to a number of risks and uncertainties that might cause actual results to differ materially from stated objectives. These factors include but are not limited to: RVSB's ability to acquire shares according to internal repurchase guidelines, regional economic conditions and the company's ability to efficiently manage expenses. Additional factors that could cause actual results to differ materially are disclosed in Riverview Bancorp's recent filings with the SEC, including but not limited to Annual Reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K.



 RIVERVIEW BANCORP, INC. AND SUBSIDIARY
 Consolidated Balance Sheets
 September 30, 2007, March 31, 2007 and September 30, 2006


 (In thousands, except share data)   Sept. 30,   March 31,   Sept. 30,
 (Unaudited)                           2007        2007        2006
 ---------------------------------------------------------------------
 ASSETS

 Cash (including interest-earning
   accounts of $15,271, $7,818
   and $15,198)                     $   36,877  $   31,423  $   43,453
 Loans held for sale                       604          --         197
 Investment securities available
   for sale, at fair value
   (amortized cost of $8,735,
   $19,258 and $23,017)                  8,761      19,267      22,963
 Mortgage-backed securities held
   to maturity, at amortized
   cost (fair value of $1,039,
   $1,243 and $1,495)                    1,027       1,232       1,477
 Mortgage-backed securities
   available for sale, at fair value
   (amortized cost of $6,043,
   $6,778 and $7,608)                    5,943       6,640       7,404
 Loans receivable (net of allowance
   for loan losses of $9,062,
   $8,653 and $8,263)                  687,419     682,951     690,650
 Real estate and other pers.
   property owned                           74          --          --
 Prepaid expenses and other assets       2,957       1,905       2,021
 Accrued interest receivable             3,850       3,822       4,117
 Federal Home Loan Bank stock,
   at cost                               7,350       7,350       7,350
 Premises and equipment, net            21,336      21,402      21,011
 Deferred income taxes, net              4,089       4,108       3,716
 Mortgage servicing rights, net            332         351         368
 Goodwill                               25,572      25,572      25,572
 Core deposit intangible, net              630         711         799
 Bank owned life insurance              13,893      13,614      13,349
                                    ----------  ----------  ----------
 TOTAL ASSETS                       $  820,714  $  820,348  $  844,447
                                    ==========  ==========  ==========

 LIABILITIES AND SHAREHOLDERS' EQUITY

 LIABILITIES:
 Deposit accounts                   $  659,785  $  665,405  $  640,404
 Accrued expenses and other
   liabilities                           8,982       9,349       7,921
 Advance payments by borrowers for
   taxes and insurance                     376         397         377
 Federal Home Loan Bank advances        33,600      35,050      90,000
 Junior subordinated debentures         22,681       7,217       7,217
 Capital lease obligation                2,704       2,721       2,737
                                    ----------  ----------  ----------
 Total liabilities                     728,128     720,139     748,656

 SHAREHOLDERS' EQUITY:
 Serial preferred stock, $.01 par
   value; 250,000 authorized,
   issued and outstanding, none             --          --          --
 Common stock, $.01 par value;
   50,000,000 authorized,
   September 30, 2007 - 10,996,650
   issued, 10,996,650 outstanding;         110         117         116
   March 31, 2007 - 11,707,980
   issued, 11,707,980 outstanding;
   September 30, 2006 - 11,575,480
   issued, 11,575,472 outstanding;
 Additional paid-in capital             47,953      58,438      57,794
 Retained earnings                      45,629      42,848      39,134
 Unearned shares issued to employee
   stock ownership trust                (1,057)     (1,108)     (1,083)
 Accumulated other
   comprehensive loss                      (49)        (86)       (170)
                                    ----------  ----------  ----------
 Total shareholders' equity             92,586     100,209      95,791
                                    ----------  ----------  ----------

 TOTAL LIABILITIES AND
   SHAREHOLDERS' EQUITY             $  820,714  $  820,348  $  844,447
                                    ==========  ==========  ==========



 RIVERVIEW BANCORP, INC. AND SUBSIDIARY
 FINANCIAL HIGHLIGHTS
 (Unaudited)

 RIVERVIEW BANCORP, INC. AND SUBSIDIARY
 Consolidated Statements of Income for the Three
 and Six Months Ended September 30, 2007 and 2006

                          Three Months Ended        Six Months Ended
 (In thousands, except       September 30,            September 30,
  share data)(Unaudited)    2007        2006        2007        2006
 ---------------------------------------------------------------------
 INTEREST INCOME:
 Interest and fees on
   loans receivable       $ 14,631    $ 14,834    $ 29,511    $ 28,603
 Interest on investment
   securities-taxable          140         221         312         442
 Interest on investment
   securities-non taxable       38          42          76          84
 Interest on mortgage-
   backed securities            85         109         176         223
 Other interest and
   dividends                   420          96         663         148
                          --------    --------    --------    --------
   Total interest income    15,314      15,302      30,738      29,500
                          --------    --------    --------    --------

 INTEREST EXPENSE:
 Interest on deposits        6,033       4,908      12,223       9,130
 Interest on borrowings        587       1,267         993       2,230
                          --------    --------    --------    --------
   Total interest expense    6,620       6,175      13,216      11,360
                          --------    --------    --------    --------
   Net interest income       8,694       9,127      17,522      18,140
   Less provision for
     loan losses               400         600        450         950
                          --------    --------    --------    --------
   Net interest income
     after provision
     for loan losses         8,294       8,527      17,072      17,190
                          --------    --------    --------    --------

 NON-INTEREST INCOME:
   Fees and service
     charges                 1,382       1,449       2,809       2,780
   Asset management fees       513         455       1,061         891
   Gain on sale of loans
     held for sale              92         111         183         183
   Loan servicing income        27          36          66          81
   Gain on sale of credit
     card portfolio             --          66          --         133
   Bank owned life
     insurance income          140         129         279         257
   Other                        62          45         120          81
                          --------    --------    --------    --------
   Total non-interest
     income                  2,216       2,291       4,518       4,406
                          --------    --------    --------    --------

 NON-INTEREST EXPENSE:
 Salaries and employee
   benefits                  3,908       3,532       7,876       7,367
 Occupancy and
   depreciation              1,244       1,135       2,546       2,209
 Data processing               208         222         376         557
 Amortization of core
   deposit intangible           38          46          80          96
 Advertising and
   marketing expense           370         356         652         658
 FDIC insurance premium         19          13          38          37
 State and local taxes         178         133         349         288
 Telecommunications             92         101         196         213
 Professional fees             172         198         395         376
 Other                         602         536       1,104       1,240
                          --------    --------    --------    --------
 Total non-interest expense  6,831       6,272      13,612      13,041
                          --------    --------    --------    --------
 INCOME BEFORE
   INCOME TAXES              3,679       4,546       7,978       8,555
 PROVISION FOR
   INCOME TAXES              1,249       1,573       2,709       2,951
                          --------    --------    --------    --------
 NET INCOME               $  2,430    $  2,973    $  5,269    $  5,604
                          ========    ========    ========    ========
 Earnings per common share:
 Basic                    $   0.22    $   0.26    $   0.47    $   0.50
 Diluted                      0.22        0.26        0.47        0.49
 Weighted average number
   of shares outstanding:
 Basic                  10,904,464  11,302,927  11,146,813  11,289,143
 Diluted                11,026,598  11,473,750  11,275,562  11,463,125




 RIVERVIEW BANCORP, INC. AND SUBSIDIARY
 FINANCIAL HIGHLIGHTS

                At or for the six months       At or for the year
                   ended September 30,           ended March 31,
 FINANCIAL       2007              2006               2007
  CONDITION      ----              ----               ----
  DATA                      (Dollars in thousands)
 ----------
 Average
  interest-
  earning
  assets       $732,999          $ 711,372          $ 731,089
 Average
  interest-
  bearing
  liabilities   621,295            592,679            614,546
 Net average
  earning
  assets        111,704            118,693            116,543
 Non-performing
  assets            206              1,704                226
 Non-performing
  loans             132              1,704                226
 Allowance for
  loan losses     9,062              8,263              8,653
 Allowance for
  loan losses
  and unfunded
  loan
  commitments     9,484              8,648              9,033
 Average
  interest-
  earning
  assets to
  average
  interest-bearing
  liabilities    117.98%            120.03%            118.96%
 Allowance for
  loan losses
  to non-
  performing
  loans        6,865.15%            484.92%          3,828.76%
 Allowance for
  loan losses
  to net loans     1.30%              1.18%              1.25%
 Allowance for
  loan losses and
  unfunded loan
  commitments
  to net loans     1.36%              1.24%              1.31%
 Non-performing
  loans to total
  net loans        0.02%              0.24%              0.03%
 Non-performing
  assets to
  total assets     0.03%              0.20%              0.03%
 Shareholders'
  equity to
  assets          11.28%             11.34%             12.22%
 Number of
  banking
  facilities         19                 18                 19

 LOAN DATA (1)
 -------------
 Commercial and
  construction
   Commercial  $ 90,515    13.00% $ 95,689    13.69% $ 91,174    13.18%
   Other real
    estate
    mortgage    367,380    52.75%  360,756    51.62%  360,930    52.19%
   Real estate
    con-
    struction   162,429    23.32%  166,233    23.78%  166,073    24.01%
               -------------------------------------------------------
   Total
    commercial
    and
    con-
    struction   620,324    89.07%  622,678    89.09%  618,177    89.38%
 Consumer
   Real estate
    one-to-four
    family       71,725    10.30%   72,319    10.35%   69,808    10.10%
   Other
    installment   4,432     0.63%    3,916     0.56%    3,619     0.52%
               -------------------------------------------------------
     Total
      consumer   76,157    10.93%   76,235    10.91%   73,427    10.62%
               -------------------------------------------------------
 Total loans    696,481  100.00%   698,913  100.00%   691,604   100.00%

 Less:
   Allowance for
    loan losses   9,062              8,263              8,653
               --------          ---------          ----------
   Loans
    receivable,
    net       $ 687,419          $ 690,650          $ 682,951
              =========          =========          =========
 (1) Certain prior period loan balances have been reclassified to
     conform to management's current year presentation.




 RIVERVIEW BANCORP, INC. AND SUBSIDIARY
 FINANCIAL HIGHLIGHTS
 (Unaudited)
 COMPOSITION OF COMMERCIAL AND CONSTRUCTION LOAN TYPES BASED ON 
 LOAN PURPOSE
 --------------------------------------------------------------

                       Commercial               Other
                    & Construction           Real Estate  Real Estate
                         Total    Commercial  Mortgage   Construction
                         -----    ----------  --------   ------------
  September 30, 2007              (Dollars in thousands)
  ------------------
 Commercial            $ 90,515     $90,515     $     --   $     --
 Commercial                                   
  construction           47,829          --           --     47,829
 Office buildings        77,126          --       77,126         --
 Warehouse/industrial    34,892          --       34,892         --
 Retail/shopping                              
  centers/strip malls    66,890          --       66,890         --
 Assisted living                              
  facilities             11,044          --       11,044         --
 Single purpose                               
  facilities             46,248          --       46,248         --
 Land                   104,134          --      104,134         --
 Multi-family            27,046          --       27,046         --
 One-to-four family     114,600          --           --    114,600
                       ----------------------------------------------
   Total               $620,324     $90,515     $367,380   $162,429
                       ==============================================
                                              
    March 31, 2007                 (Dollars in thousands)
    --------------
 Commercial            $ 91,174     $91,174     $     --   $     --
 Commercial                                   
  construction           56,226          --           --     56,226
 Office buildings        62,310          --       62,310         --
 Warehouse/industrial    40,238          --       40,238         --
 Retail/shopping                              
  centers/strip malls    70,219          --       70,219         --
 Assisted living                              
  facilities             11,381          --       11,381         --
 Single purpose                               
  facilities             41,501          --       41,501         --
 Land                   103,240          --      103,240         --
 Multi-family            32,041          --       32,041         --
 One-to-four family     109,847          --           --    109,847
                       ----------------------------------------------
   Total               $618,177     $91,174     $360,930   $166,073
                       ==============================================



                      At the six months ended          At the year
                          September 30,              ended March 31,
                     2007               2006              2007
                     ----               ----              ----
                                (Dollars in thousands)
 DEPOSIT DATA
 ------------
 Interest 
  checking    $132,340   20.06%  $153,631   23.99%  $144,451   21.71%
 Regular 
  savings       27,408    4.15%    32,896    5.14%    29,472    4.43%
 Money market
  deposit 
  accounts     235,091   35.63%   145,612   22.74%   205,007   30.81%
 Non-interest
  checking      85,492   12.96%   101,852   15.90%    86,601   13.01%
 Certificates
  of deposit   179,454   27.20%   206,413   32.23%   199,874   30.04%
              --------------------------------------------------------
 Total 
  deposits    $659,785  100.00%  $640,404  100.00%  $665,405  100.00%
              ========================================================





 RIVERVIEW BANCORP, INC. AND SUBSIDIARY
 FINANCIAL HIGHLIGHTS
 (Unaudited)

                         At or for the three      At or for the six
                            months ended             months ended
                            September 30,            September 30, 
 SELECTED OPERATING 
  DATA                    2007        2006        2007        2006
 ------------------       ----        ----        ----        ----
                          (Dollars in thousands, except share data)
 Efficiency ratio (4)       62.61%      54.93%      61.76%      57.84%
 Efficiency ratio net
  of intangible
  amortization              61.98%      54.31%      61.15%      57.21%
 Coverage ratio (6)        127.27%     145.52%     128.72%     139.10%
 Coverage ratio net
  of intangible
  amortization             127.98%     146.59%     129.49%     140.13%
 Return on average
  assets (1)                 1.19%       1.45%       1.29%       1.41%
 Return on average
  equity (1)                 9.98%      12.22%      10.58%      11.70%
 Average rate earned
  on interest-earned
  assets                     8.31%       8.32%       8.37%       8.28%
 Average rate paid on
  interest-bearing
  liabilities                4.22%       4.01%       4.24%       3.82%
 Spread (7)                  4.09%       4.31%       4.13%       4.46%
 Net interest margin         4.72%       4.97%       4.78%       5.10%

 PER SHARE DATA
 --------------
 Basic earnings per
  share (2)            $     0.22  $     0.26  $     0.47  $     0.50
 Diluted earnings per
  share (3)                  0.22        0.26        0.47        0.49
 Book value per
  share (5)                  8.42        8.28        8.42        8.28
 Tangible book value
  per share (5)              6.01        5.97        6.01        5.97
 Market price per
  share:
   High for the period $    15.73  $    13.65  $    16.28  $    13.65
   Low for the period       13.30       12.58       13.30       12.14
   Close for period end     14.85       13.50       14.85       13.50
 Cash dividends
  declared per share        0.110       0.100       0.220       0.195

 Average number of
  shares outstanding:
   Basic (2)           10,904,464  11,302,927  11,146,813  11,289,143
   Diluted (3)         11,026,598  11,473,750  11,275,562  11,463,125

 (1) Amounts are annualized.
 (2) Amounts calculated exclude ESOP shares not committed to be 
     released.
 (3) Amounts calculated exclude ESOP shares not committed to be 
     released and include common stock equivalents.
 (4) Non-interest expense divided by net interest income and 
     non-interest income.
 (5) Amounts calculated include ESOP shares not committed to be 
     released.
 (6) Net interest income divided by non-interest expense.
 (7) Yield on interest-earning assets less cost of funds on interest 
     bearing liabilities.


            

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