CHINO, Calif., July 21, 2017 (GLOBE NEWSWIRE) — The Board of Directors of Chino Commercial Bancorp (OTC:CCBC), the parent company of Chino Commercial Bank, N.A., announced the results of operations for the Bank and the consolidated holding company for the second quarter ended June 30, 2017 with net earnings of $420 thousand, or an increase of 13%, compared with net income of $372 thousand for the same quarter last year. Net income per basic share for the second quarter of 2017 was $0.34 as compared to $0.30 for the same quarter last year.

Dann H. Bowman, President and Chief Executive Officer stated, “In addition to the excellent second quarter earnings results, the Bank was recently recognized by the Findley Reports on Financial Institutions by receiving their highest rating of ‘Super Premier Performing.’  The economic strength of the Inland Empire is supporting tremendous growth opportunities for the Bank.  In general, this is a very good time for the Bank and we are pleased and excited about the future.”

Financial Condition

At June 30, 2017, total assets were $180.3 million, an increase of $5.2 million or 3.0% over $175.1 million at December 31, 2016.  Total deposits increased by 3.0% or $4.1 million during the year to $141.7 million, compared to $137.6 million as of December 31, 2016. At June 30, 2017, the Company’s core deposits represent 97.0% of the total deposits.

Gross loans increased by 1.7% or $1.9 million as of June 30, 2017 to $111.4 million, as compared with $109.5 million as of December 31, 2016.  The Bank did not have any nonperforming loans for the quarter ended June 30, 2017, and one nonperforming loan as of December 31, 2016, respectively.  OREO properties remained at zero as of June 30, 2017 and December 31, 2016, respectively.

Earnings

The Company posted net interest income of $1.6 million and $1.5 million for the three months ended June 30, 2017 and 2016, respectively, or an increase of $102 thousand or 7.0%.  Average interest-earning assets were $166.1 million with average interest-bearing liabilities of $95.3 million, yielding a net interest margin of 3.78% for the second quarter of 2017, as compared to the average interest-earning assets of $149.6 million with average interest-bearing liabilities of $77.7 million, yielding a net interest margin of 3.93% for the second quarter of 2016.

Non-interest income totaled $389 thousand for the second quarter of 2017, or a decrease of 9.2% as compared with $427 thousand earned during the same quarter last year. The majority of this decrease is attributed to $77 thousand of extraordinary income recorded in the same quarter last year.  Without this extraordinary income the Company would have reported a $37 thousand or 10.8% increase in non-interest income for the second quarter of 2017.  Service charges on deposit accounts increased by $48 thousand or 18.0% to $317 thousand primarily due to an increase in income from returned items and overdraft charges. Dividend income from restricted stock decreased to $28 thousand for the second quarter of 2017, compared to $38 thousand for the same quarter in 2016, due to the Federal Home Loan Bank change in dividend payout percentage policy. Income from bank-owned life insurance remained consistent at $25 thousand in the second quarter of 2017 and 2016, respectively.

General and administrative expenses were $1.3 million for the three months ended June 30, 2017, as compared to $1.1 million for the second quarter of 2016. The largest component of general and administrative expenses was salary and benefits expense of $772 thousand for the second quarter of 2017, as compared to $706 thousand for the same quarter last year. Regulatory assessments remained consistent at $37 thousand for the second quarter of 2017 and 2016, respectively. Advertising and marketing expenses increased by $13 thousand or 73.7% to $30 thousand in the second quarter of 2017 from $17 thousand for the same period last year.  The Company engaged a marketing company to assist with advertising efforts during the second quarter of 2017.

Income tax expense was $273 thousand for the three months ended June 30, 2017 as compared to $238 thousand for the three months ended June 30, 2016. The effective income tax rate for the second quarter of 2017 and 2016 is approximately 39.4% and 39.0%, respectively.

Forward-Looking Statements

The statements contained in this press release that are not historical facts are forward-looking statements based on management’s current expectations and beliefs concerning future developments and their potential effects on the Company. Readers are cautioned not to unduly rely on forward-looking statements. Actual results may differ from those projected. These forward-looking statements involve risks and uncertainties, including but not limited to, the health of the national and California economies, the Company’s ability to attract and retain skilled employees, customers’ service expectations, the Company’s ability to successfully deploy new technology and gain efficiencies there from, changes in interest rates, loan portfolio performance, and other factors.

Contact: Dann H. Bowman, President and CEO or Melinda M. Milincu, Vice President and CFO, Chino Commercial Bancorp and Chino Commercial Bank, N.A., 14245 Pipeline Avenue, Chino, Ca. 91710, (909) 393-8880.

CHINO COMMERCIAL BANCORP
CONSOLIDATED BALANCE SHEET
June 30, 2017 and December 31, 2016
 
  June 30, 2017   December 31, 2016
  (unaudited)   (audited)
ASSETS:      
Cash and due from banks $ 29,825,751     $ 30,498,888  
Total cash and cash equivalents   29,825,751       30,498,888  
       
Interest-bearing deposits in other banks   2,232,000       2,480,000  
Investment securities available for sale   3,531,430       3,924,102  
Investment securities held to maturity (fair value approximates      
$22,491,000 at June 30, 2017 and $18,240,000 at December 31, 2016)   22,496,275       18,407,741  
Total investments   28,259,705       24,811,843  
Loans      
Commercial   17,993,486       21,822,341  
Installment   514,395       424,818  
Gross loans   111,447,642       109,553,786  
Unearned fees and discounts   (347,223 )     (348,359 )
Loans net of unearned fees and discount   111,100,419       109,205,427  
Allowance for loan losses   (1,916,446 )     (1,845,447 )
Net loans   109,183,973       107,359,980  
       
Fixed assets, net   5,900,130       6,000,404  
Accrued interest receivable   444,797       295,102  
Stock investments, restricted, at cost   1,963,496       1,935,300  
Bank-owned life insurance   3,336,195       3,285,963  
Other assets   1,407,297       904,338  
Total assets $ 180,321,344     $ 175,091,818  
       
LIABILITIES:      
Deposits      
Non-interest bearing $ 69,565,818     $ 68,613,998  
Interest bearing      
NOW and money market   55,416,295       52,873,006  
Savings   6,399,383       5,165,730  
Time deposits less than $250,000   6,008,275       4,438,254  
Time deposits of $250,000 or greater   4,270,436       6,471,260  
Total deposits   141,660,207       137,562,248  
       
Accrued interest payable   27,705       27,902  
Borrowings from Federal Home Loan Bank (FHLB)   20,000,000       20,000,000  
Accrued expenses & other payables   1,164,749       872,374  
Subordinated notes payable to subsidiary trust   3,093,000       3,093,000  
Total liabilities   165,945,661       161,555,524  
       
SHAREHOLDERS’ EQUITY      
Common stock, authorized 10,000,000 shares with no par value, issued and outstanding 1,231,332 shares at June 30, 2017 and December 31, 2016, respectively.   6,089,466       6,089,466  
Retained earnings   8,281,651       7,449,608  
Accumulated other comprehensive income/(loss)   4,566       (2,780 )
Total shareholders’ equity   14,375,683       13,536,294  
Total liabilities & shareholders’ equity $ 180,321,344     $ 175,091,818  
       

 

CHINO COMMERCIAL BANCORP
CONSOLIDATED STATEMENTS OF NET INCOME
(unaudited)
  For the three months ended   For the year ended
  June 30   June 30
  2017   2016   2017   2016
Interest income              
Interest and fee income on loans $ 1,491,361     $ 1,382,543     $ 2,959,072     $ 2,692,647  
Interest on federal funds sold and FRB deposits   73,484       26,703       133,613       53,036  
Interest on time deposits in banks   6,956       9,929       14,013       20,379  
Interest on investment securities   136,547       140,819       259,292       288,658  
Total interest income   1,708,348       1,559,994       3,365,990       3,054,720  
               
Interest Expense              
Interest on deposits   76,044       65,082       151,885       125,430  
Other borrowings   69,244       34,181       123,377       68,432  
Total interest expense   145,288       99,263       275,262       193,862  
Net interest income   1,563,060       1,460,731       3,090,728       2,860,858  
Provision for loan losses         131,364       55,000       126,300  
               
Net interest income after provision for loan losses   1,563,060       1,329,367       3,035,728       2,734,558  
               
Non-interest income              
Service charges on deposit accounts   317,394       268,928       609,037       546,801  
Other miscellaneous income   18,067       95,313       36,177       117,946  
Dividend income from restricted stock   27,840       37,962       72,921       72,843  
Income from bank-owned life insurance   25,210       25,597       50,232       51,168  
Total non-interest income   388,511       427,800       768,367       788,758  
               
Non-interest expenses              
Salaries and employee benefits   771,541       706,355       1,516,317       1,387,244  
Occupancy and equipment   99,142       99,125       204,673       202,953  
Data and item processing   85,765       77,128       119,445       189,667  
Advertising and marketing   30,271       17,426       52,115       34,542  
Legal and professional fees   73,424       40,101       110,859       87,531  
Regulatory assessments   37,607       36,539       75,218       66,850  
Insurance   8,685       8,539       16,689       17,010  
Directors’ fees and expenses   31,545       27,129       58,092       53,839  
Other expenses   120,161       135,288       219,443       232,321  
Total non-interest expenses   1,258,141       1,147,630       2,372,851       2,271,957  
Income before income tax expense   693,430       609,537       1,431,244       1,251,359  
Income tax expense   273,302       237,697       540,380       488,991  
Net income $ 420,128     $ 371,840     $ 890,864     $ 762,368  
               
Basic earnings per share $ 0.34     $ 0.30     $ 0.72     $ 0.62  
Diluted earnings per share $ 0.34     $ 0.30     $ 0.72     $ 0.62  
               
         
Tax rate   39.4 %     39.0 %     37.8 %     39.1 %
               

 

    For the three months ended   For the year ended
    June 30   June 30
    2017   2016   2017   2016
KEY FINANCIAL RATIOS                
(unaudited)                
Annualized return on average equity     11.82 %     11.70 %     12.72 %     12.18 %
Annualized return on average assets     0.93 %     0.90 %     0.99 %     0.93 %
Net interest margin     3.78 %     3.93 %     3.77 %     3.88 %
Core efficiency ratio     64.47 %     60.77 %     61.49 %     62.25 %
Net chargeoffs/(recoveries) to average loans     -0.01 %     0.06 %     -0.02 %     0.05 %
                 
AVERAGE BALANCES                
(thousands, unaudited)                
Average assets   $ 181,103     $ 165,504     $ 180,141     $ 163,906  
Average interest-earning assets   $ 166,054     $ 149,635     $ 165,432     $ 148,096  
Average gross loans   $ 111,967     $ 98,736     $ 111,056     $ 96,382  
Average deposits   $ 142,353     $ 132,349     $ 141,145     $ 131,014  
Average equity   $ 14,212     $ 12,717     $ 14,004     $ 12,516  
                 
                 
                 
CREDIT QUALITY   End of period        
(unaudited)   June 30, 2017   December 31, 2016        
                 
Non-performing loans   $     $ 521,696          
                 
Non-performing loans to total loans     0.00 %     0.48 %        
Non-performing loans to total assets     0.00 %     0.30 %        
Allowance for loan losses to total loans     1.72 %     1.68 %        
Nonperforming assets as a percentage of total loans and OREO     0.00 %     0.48 %        
Allowance for loan losses to non-performing loans     n/a       353.74 %        
                 
OTHER PERIOD-END STATISTICS                
(unaudited)                
Shareholders equity to total assets     7.97 %     7.73 %        
Net loans to deposits     77.07 %     78.04 %        
Non-interest bearing deposits to total deposits     49.11 %     49.88 %        
Total capital to total risk-weighted assets     15.55 %     15.37 %        
Tier 1 capital to total risk-weighted assets     15.69 %     15.32 %        
Tier 1 leverage ratio     10.58 %     10.24 %        
Common equity tier 1     15.69 %     15.32 %