Loans Receivable, Credit Quality for Loans and the Allowance for Loan Losses (Tables)

6 Months Ended

Jun. 30, 2016

Schedule of Loans Receivable

The loan portfolio comprises the major component of Riverview’s earning assets and is the highest yielding asset category. Loans receivable are summarized as follows for the periods presented:

(Dollars in thousands)	June 30, 2016			December 31, 2015
Commercial	$	46,330		$	46,076
Commercial real estate		206,721			205,500
Commercial land and land development		9,166			18,599
Residential real estate		112,514			117,669
Home equity lines of credit		18,909			17,437
Consumer installment		4,853			4,564
Total loans		398,493			409,845
Allowance for loan losses		(3,609	)		(4,365	)
Total loans, net	$	394,884		$	405,480

Summary of Aging of Loans Receivable by Loan Portfolio Segments

The following table presents an aging of loans receivable by loan portfolio segments as of June 30, 2016 and December 31, 2015, and includes nonaccrual loans and loans past due 90 days or more and still accruing:

(In thousands)	30-59 Days Past Due		60-89 Days Past Due		90 Days and Greater		Total Past Due		Current		Total		Recorded Investment Greater Than 90 Days & Accruing
June 30, 2016:
Commercial	$	741	$	1	$	215	$	957	$	45,373	$	46,330	$	—
Commercial real estate:
Non-owner occupied		2,232		—		—		2,232		102,398		104,630		—
Owner occupied		381		—		285		666		76,196		76,862		—
1-4 family investment		130		576		30		736		24,493		25,229		30
Commercial land and land development		218		—		—		218		8,948		9,166		—
Residential real estate		640		194		568		1,402		111,112		112,514		319
Home equity lines of credit		112		30		—		142		18,767		18,909		—
Consumer		1		—		—		1		4,852		4,853		—
Total	$	4,455	$	801	$	1,098	$	6,354	$	392,139	$	398,493	$	349
	30-59 Days Past Due		60-89 Days Past Due		90 Days and Greater		Total Past Due		Current		Total		Recorded Investment Greater Than 90 Days & Accruing
December 31, 2015
Commercial	$	34	$	—	$	1,007	$	1,041	$	45,035	$	46,076	$	—
Commercial real estate:
Non-owner occupied		—		—		24		24		110,431		110,455		—
Owner occupied		172		447		270		889		68,758		69,647		—
1-4 family investment		131		—		265		396		25,002		25,398		—
Commercial land and land development		—		250		—		250		18,349		18,599		—
Residential real estate		1,163		1,025		595		2,783		114,886		117,669		89
Home equity lines of credit		46		412		36		494		16,943		17,437		—
Consumer		10		—		1		11		4,553		4,564		—
Total	$	1,556	$	2,134	$	2,198	$	5,888	$	403,957	$	409,845	$	89

Schedule of Loans by Loan Portfolio Segments on Nonaccrual Status

The following table presents loans by loan portfolio segments that were on a nonaccrual status as of June 30, 2016 and December 31, 2015:

(In thousands)	June 30, 2016		December 31, 2015
Commercial	$	355	$	1,143
Commercial real estate:
Non-owner occupied		—		24
Owner occupied		493		766
1-4 family investment		120		328
Residential real estate		607		885
Home equity lines of credit		—		36
Total	$	1,575	$	3,182

Schedule of Impaired Loans by Loan Portfolio Segments

The following presents impaired loans by loan portfolio segments for the periods presented:

	June 30, 2016						Three Months Ended June 30, 2016				Six Months Ended June 30, 2016
(In thousands)	Recorded Investment in Impaired Loans		Unpaid Principal Balance of Impaired Loans		Related Allowance		Average Recorded Investment in Impaired Loans		Interest Income Recognized		Average Recorded Investment in Impaired Loans		Interest Income Recognized
Loans with no related allowance recorded:
Commercial	$	848	$	848	$	—	$	850	$	7	$	852	$	14
Commercial real estate:
Non-owner occupied		2,150		2,150		—		2,156		20		2,160		39
Owner occupied		972		972		—		976		18		981		37
1-4 family investment		854		854		—		861		7		868		14
Residential real estate		2,365		2,502		—		2,522		30		2,555		61
Home equity lines of credit		361		361		—		403		4		404		7
	$	7,550	$	7,687	$	—	$	7,768	$	86	$	7,820	$	172
Loans with an allowance recorded:
Commercial	$	131	$	131	$	1	$	132	$	—	$	134	$	—
Commercial real estate:
Owner Occupied		207		207		2		209		—		212		—
Residential real estate		119		119		33		120		1		120		2
	$	457	$	457	$	36	$	461	$	1	$	466	$	2
Total
Commercial	$	979	$	979	$	1	$	982	$	7	$	986	$	14
Commercial real estate:
Non-owner occupied		2,150		2,150		—		2,156		20		2,160		39
Owner occupied		1,179		1,179		2		1,185		18		1,193		37
1-4 family investment		854		854		0		861		7		868		14
Residential real estate		2,484		2,621		33		2,642		31		2,675		63
Home equity lines of credit		361		361		—		403		4		404		7
	$	8,007	$	8,144	$	36	$	8,229	$	87	$	8,286	$	174

	December 31, 2015						Three Months Ended June 30, 2015				Six Months Ended June 30, 2015
(In thousands)	Recorded Investment in Impaired Loans		Unpaid Principal Balance of Impaired Loans		Related Allowance		Average Recorded Investment in Impaired Loans		Interest Income Recognized		Average Recorded Investment in Impaired Loans		Interest Income Recognized
Loans with no related allowance recorded:
Commercial	$	994	$	994	$	—	$	511	$	20	$	512	$	27
Commercial real estate:
Non-owner occupied		2,163		2,163		—		2,182		20		2,184		39
Owner occupied		1,462		1,462		—		1,198		31		1,007		46
1-4 family investment		879		879		—		814		6		817		11
Commercial land and land development		—		—		—		219		—		218		—
Residential real estate		2,526		2,644		—		2,431		41		2,530		86
Home equity lines of credit		400		400		—		445		16		448		16
	$	8,424	$	8,562	$	—	$	7,800	$	134	$	7,716	$	225
Loans with an allowance recorded:
Commercial	$	793	$	1,193	$	700	$	1,062	$	—	$	866	$	15
Commercial real estate:
Non-owner occupied		24		155		1		—		—		—		—
1-4 family investment		186		193		7		193		—		192		—
Residential real estate		121		121		7		123		1		123		2
	$	1,124	$	1,662	$	715	$	1,378	$	1	$	1,181	$	17
Total
Commercial	$	1,787	$	2,187	$	700	$	1,573	$	20	$	1,378	$	42
Commercial real estate:
Non-owner occupied		2,187		2,318		1		2,182		20		2,184		39
Owner occupied		1,462		1,462		—		1,198		31		1,007		46
1-4 family investment		1,065		1,072		7		1,007		6		1,009		11
Commercial land and land development		—		—		—		219		—		218		—
Residential real estate		2,647		2,785		7		2,554		42		2,653		88
Home equity lines of credit		400		400		—		445		16		448		16
	$	9,548	$	10,224	$	715	$	9,178	$	135	$	8,897	$	242

Schedule of Number of Loans and Recorded Investment in TDRs

The following table presents the number of loans and recorded investment in loans restructured and identified as TDRs for the three and six months ended June 30, 2015. There were no defaults or TDRs occurring within 12 months of modification during the three and six month periods ended June 30, 2016 and 2015. Defaulted loans are those for which payment is 30 days or more past due under the modified terms. There were no troubled debt restructurings during the three and six months ended June 30, 2016.

	Three Months Ended June 30, 2015						Six Months Ended June 30, 2015
(In thousands, except contracts data)	Number of Contracts		Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment		Number of Contracts		Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
Troubled Debt Restructurings:
Commercial real estate:
Owner occupied		—	$	—	$	—		1	$	149	$	149
Residential real estate		—		—		—		3		473		473

Schedule of Allowance for Loan Losses by Loan Portfolio Segments

The allowance for loan losses is presented by loan portfolio segments with the outstanding balances of loans for the periods presented:

				Commercial Real Estate
(In thousands)	Commercial			Non-Owner Occupied			Owner Occupied			1-4 Family Investment		Commercial – Land and Land Development		Residential Real Estate			Home Equity Lines of Credit		Consumer		Unallocated			Total
Allowance for Loan Losses for the Three Months Ended June 30, 2016:
Beginning balance	$	566		$	1,320		$	621		$	270	$	93	$	650		$	104	$	30	$	63		$	3,717
Charge-offs		—			—			—			41		249		8			—		5		—			303
Recoveries		36			—			—			—		—		2			—		1		—			39
Provision		(44	)		(135	)		11			54		326		(9	)		6		10		(63	)		156
Ending balance	$	558		$	1,185		$	632		$	283	$	170	$	635		$	110	$	36	$	0		$	3,609
Ending balance: individually evaluated for impairment	$	1		$	—		$	2		$	—	$	—	$	33		$	—	$	—	$	—		$	36
Ending balance: collectively evaluated for impairment	$	557		$	1,185		$	630		$	283	$	170	$	602		$	110	$	36	$	—		$	3,573
Allowance for Loan Losses for the Three Months Ended June 30, 2015:
Beginning balance	$	363		$	1,297		$	731		$	395	$	113	$	672		$	107	$	19	$	38		$	3,735
Charge-offs		—			—			—			11		—		12			10		16		—			49
Recoveries		8			—			—			—		—		—			—		1		—			9
Provision		269			(6	)		(12	)		14		3		20			19		18		125			450
Ending balance	$	640		$	1,291		$	719		$	398	$	116	$	680		$	116	$	22	$	163		$	4,145
Ending balance: individually evaluated for impairment	$	272		$	—		$	—		$	14	$	—	$	6		$	—	$	—	$	—		$	292
Ending balance: collectively evaluated for impairment	$	368		$	1,291		$	719		$	384	$	116	$	674		$	116	$	22	$	163		$	3,853

				Commercial Real Estate
(In thousands)	Commercial			Non-Owner Occupied			Owner Occupied		1-4 Family Investment		Commercial – Land and Land Development		Residential Real Estate		Home Equity Lines of Credit		Consumer		Unallocated		Total
Allowance for Loan Losses for the Six Months Ended June 30, 2016:
Beginning balance	$	1,298		$	1,372		$	552	$	303	$	202	$	520	$	93	$	25	$	—	$	4,365
Charge-offs		723			24			—		41		249		8		—		16		—		1,061
Recoveries		46			—			—		—		—		2		—		2		—		50
Provision		(63	)		(163	)		80		21		217		121		17		25		—		255
Ending balance	$	558		$	1,185		$	632	$	283	$	170	$	635	$	110	$	36	$	—	$	3,609
Ending balance: individually evaluated for impairment	$	1		$	—		$	2	$	—	$	—	$	33	$	—	$	—	$	—	$	36
Ending balance: collectively evaluated for impairment	$	557		$	1,185		$	630	$	283	$	170	$	602	$	110	$	36	$	—	$	3,573
Allowance for Loan Losses for the Six Months Ended June 30, 2015:
Beginning balance	$	330		$	1,380		$	713	$	369	$	115	$	701	$	104	$	15	$	65	$	3,792
Charge-offs		—			—			39		11		—		27		10		22		—		109
Recoveries		8			—			—		—		—		—		—		4		—		12
Provision		302			(89	)		45		40		1		6		22		25		98		450
Ending balance	$	640		$	1,291		$	719	$	398	$	116	$	680	$	116	$	22	$	163	$	4,145
Ending balance: individually evaluated for impairment	$	272		$	—		$	—	$	14	$	—	$	6	$	—	$	—	$	—	$	292
Ending balance: collectively evaluated for impairment	$	368		$	1,291		$	719	$	384	$	116	$	674	$	116	$	22	$	163	$	3,853

			Commercial Real Estate
(In thousands)	Commercial		Non-Owner Occupied		Owner Occupied		1-4 Family Investment		Commercial – Land and Land Development		Residential Real Estate		Home Equity Lines of Credit		Consumer		Unallocated	Total
Loans as of June 30, 2016:
Ending balance	$	46,330	$	104,630	$	76,862	$	25,229	$	9,166	$	112,514	$	18,909	$	4,853		$	398,493
Ending balance: individually evaluated for impairment	$	979	$	2,150	$	1,179	$	854	$	—	$	2,484	$	361	$	—		$	8,007
Ending balance: collectively evaluated for impairment	$	45,351	$	102,480	$	75,683	$	24,375	$	9,166	$	110,030	$	18,548	$	4,853		$	390,486
Loans as of December 31, 2015:
Ending balance	$	46,076	$	110,455	$	69,647	$	25,398	$	18,599	$	117,669	$	17,437	$	4,564		$	409,845
Ending balance: individually evaluated for impairment	$	1,787	$	2,187	$	1,462	$	1,065	$	—	$	2,647	$	400	$	—		$	9,548
Ending balance: collectively evaluated for impairment	$	44,289	$	108,268	$	68,185	$	24,333	$	18,599	$	115,022	$	17,037	$	4,564		$	400,297

Summary of Credit Quality Indicators and Total Credit Exposure by Internally Assigned Grades

The following table presents the credit quality indicators and total credit exposure for each segment in the loan portfolio by internally assigned grades as of June 30, 2016 and December 31, 2015:

			Commercial Real Estate
(In thousands)	Commercial		Non- Owner Occupied		Owner Occupied		1-4 Family Investment		Commercial – Land and Land Development		Residential Real Estate		Home Equity Lines of Credit		Consumer		Total
June 30, 2016
1 – Excellent	$	241	$	—	$	—	$	—	$	—	$	—	$	—	$	106	$	347
2 – Good		2,607		34		1,134		28		179		—		—		—		3,982
3 – Satisfactory		40,563		94,055		69,844		18,123		8,738		108,872		18,185		4,747		363,127
4 – Watch		1,046		5,377		2,895		5,168		249		398		335		—		15,468
5 – Special Mention		475		2,252		1,466		1,254		—		161		28		—		5,636
6 – Substandard		1,398		2,912		1,523		656		—		3,083		361		—		9,933
7 – Doubtful		—		—		—		—		—		—		—		—		—
8 – Loss		—		—		—		—		—		—		—		—		—
Total	$	46,330	$	104,630	$	76,862	$	25,229	$	9,166	$	112,514	$	18,909	$	4,853	$	398,493

			Commercial Real Estate
(In thousands)	Commercial		Non- Owner Occupied		Owner Occupied		1-4 Family Investment		Commercial – Land and Land Development		Residential Real Estate		Home Equity Lines of Credit		Consumer		Total
December 31, 2015:
1 – Excellent	$	249	$	—	$	—	$	—	$	—	$	—	$	—	$	114	$	363
2 – Good		2,729		111		1,190		35		168		—		—		—		4,233
3 – Satisfactory		39,193		99,010		60,806		17,990		18,070		113,681		16,671		4,450		369,871
4 – Watch		1,206		5,730		4,290		5,238		111		403		338		—		17,316
5 – Special Mention		443		2,270		1,530		1,269		—		164		28		—		5,704
6 – Substandard		2,256		3,334		1,831		866		250		3,421		400		—		12,358
7 – Doubtful		—		—		—		—		—		—		—		—		—
8 – Loss		—		—		—		—		—		—		—		—		—
Total	$	46,076	$	110,455	$	69,647	$	25,398	$	18,599	$	117,669	$	17,437	$	4,564	$	409,845

Union Bank [Member]

Summary of Loans Acquired

The following is a summary of the loans acquired in the Union transaction as of November 1, 2013, the date of the consolidation:

	Purchased Credit Impaired Loans			Purchased Non- Impaired Loans			Total Purchased Loans
Union	(In thousands)
Contractually required principal and interest at acquisition	$	10,290		$	92,704		$	102,994
Contractual cash flows not expected to be collected		(5,487	)		(9,492	)		(14,979	)
Expected cash flows at acquisition		4,803			83,212			88,015
Interest component of expected cash flows		(386	)		(12,278	)		(12,664	)
Basis in acquired loans at acquisition – estimated fair value	$	4,417		$	70,934		$	75,351

Summary of Unpaid Principal Balances and Related Carrying Amounts of Acquired Loans

The unpaid principal balances and the related carrying amount of Union acquired loans as of June 30, 2016 and December 31, 2015 were as follows:

	June 30, 2016		December 31, 2015
	(In thousands)
Credit impaired purchased loans evaluated individually for incurred credit losses
Outstanding balance	$	1,303	$	1,478
Carrying Amount		580		668
Other purchased loans evaluated collectively for incurred credit losses
Outstanding balance		43,647		49,762
Carrying Amount		42,719		47,723
Total Purchased Loans
Outstanding balance		44,950		51,240
Carrying Amount		43,299		48,391

Summary of Changes in Accretable Discount Related to Purchased Credit Impaired Loans

As of the indicated dates, the changes in the accretable discount related to the purchased credit impaired loans were as follows:

	Three Months Ended						Six Months Ended
	June 30, 2016			June 30, 2015			June 30, 2016			June 30, 2015
(In thousands)
Balance – beginning of period	$	259		$	300		$	307		$	310
Accretion recognized during the period		(21	)		(30	)		(115	)		(56	)
Net reclassification from non-accretable to accretable		13			56			59			72
Balance – end of period	$	251		$	326		$	251		$	326

Citizens National Bank of Meyersdale [Member]

Summary of Loans Acquired

The following is a summary of the loans acquired in the Citizens’ merger as of December 31, 2015, the effective date of the merger:

	Purchased Credit Impaired Loans			Purchased Non- Impaired Loans			Total Purchased Loans
Citizens	(In thousands)
Contractually required principal and interest at acquisition	$	894		$	81,780		$	82,674
Contractual cash flows not expected to be collected		(237	)		(13,517	)		(13,754	)
Expected cash flows at acquisition		657			68,263			68,920
Interest component of expected cash flows		(217	)		(10,841	)		(11,058	)
Basis in acquired loans at acquisition – estimated fair value	$	440		$	57,422		$	57,862

Summary of Unpaid Principal Balances and Related Carrying Amounts of Acquired Loans

The unpaid principal balances and the related carrying amount of Citizens acquired loans as of June 30, 2016 and December 31, 2015 were as follows:

	June 30, 2016		December 31, 2015
	(In thousands)
Credit impaired purchased loans evaluated individually for incurred credit losses
Outstanding balance	$	610	$	608
Carrying Amount		431		440
Other purchased loans evaluated collectively for incurred credit losses
Outstanding balance		51,933		57,581
Carrying Amount		51,677		57,422
Total Purchased Loans
Outstanding balance		52,543		58,189
Carrying Amount		52,108		57,862

Summary of Changes in Accretable Discount Related to Purchased Credit Impaired Loans

As of the indicated dates, the changes in the accretable discount related to the purchased credit impaired loans were as follows:

	Three Months Ended					Six Months Ended
	June 30, 2016			June 30, 2015		June 30, 2016			June 30, 2015
(In thousands)
Balance – beginning of period	$	213		$	—	$	217		$	—
Accretion recognized during the period		(8	)		—		(14	)		—
Net reclassification from non-accretable to accretable		1			—		3			—
Balance – end of period	$	206		$	—	$	206		$	—