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Chino Commercial Bancorp Reports 22% Increase in First Quarter Earnings

CHINO, Calif., April 22, 2016 (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 first quarter ended March 31, 2016 with net earnings of $390,530, or an increase of 22.5%, compared with net income of $318,868 for the same quarter last year. Net income per basic share for the first quarter of 2016 was $0.38 as compared to $0.31 for the same quarter last year.

Dann H. Bowman, President and Chief Executive Officer, stated, “The Company had an excellent first quarter with strong earnings and very good loan performance. The Bank also recently received recognition from the Findley Reports on Financial Institutions by again receiving their highest rating of Super Premier Performing for fiscal year 2015.”

Financial Condition

At March 31, 2016, total assets were $164.4 million, an increase of $3.0 million or 1.9% over $161.4 million at December 31, 2015. Total deposits increased by 2.1% or $2.8 million during the first quarter to $133.1 million, compared to $130.3 million as of December 31, 2015. At March 31, 2016, the Company’s core deposits represent 95.3% of the total deposits.

Gross loans increased by 5.5% or $5.1 million during the first quarter to $98.3 million as compared with $93.2 million as of December 31, 2015. The Bank’s loan quality remained consistent during the first quarter as nonperforming assets and OREO were both at zero at March 31, 2016, and December 31, 2015.

Earnings

The Company posted net interest income of $1,400,128 and $1,225,212 for the three months ended March 31, 2016 and 2015, respectively, or an increase of $174,916 or 14.3%. Average interest-earning assets were $147.7 million with average interest-bearing liabilities of $76.0 million, yielding a net interest margin of 3.81% for the first quarter of 2016; as compared to the average interest-earning assets of $119.5 million with average interest-bearing liabilities of $60.9 million, yielding a net interest margin of 4.16% for the first quarter of 2015.

Non-interest income totaled $360,959 for the first quarter of 2016, or a decrease of 2.1% as compared with $368,668 earned during the first quarter last year. Service charges on deposit accounts decreased 9.2% to $277,873 due to a decrease in income from returned items and overdraft charges. Dividend income from restricted stock increased to $34,881 for the first quarter of 2016, compared to $18,374 for the same quarter in 2015, due to additional purchases of restricted stock. Income from bank-owned life insurance remained consistent at $25,572 in the first quarter of 2016 and $25,418 in the first quarter of 2015.

General and administrative expenses were $1,118,217 for the three months ended March 31, 2016, as compared to $1,075,780 for the first quarter of 2015. The largest component of general and administrative expenses was salary and benefits expense of $680,889 for the first quarter of 2016, as compared to $663,539 for the same quarter last year. Regulatory assessments remained consistent at $30,311 in the first quarter of 2016 and $30,519 in the first quarter of 2015. Advertising and marketing expenses increased 48.5% to $17,116 in the first quarter of 2016 from $11,528 for the same period last year.

Income tax expense was $251,294 for the three months ended March 31, 2016 as compared to $197,774 for the three months ended March 31, 2015. The effective income tax rate for the first quarter of 2016 and 2015 is approximately 39.2% and 38.3%, 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 detailed in the Company’s SEC filings.

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
March 31, 2016 and December 31, 2015
March 31, 2016 December 31, 2015
(unaudited) (audited)
ASSETS:
Cash and due from banks$26,034,207 $24,898,140
Total cash and cash equivalents 26,034,207 24,898,140
Interest-bearing deposits in other banks 4,712,000 $4,960,000
Investment securities available for sale 4,856,359 4,931,068
Investment securities held to maturity (fair value approximates
$25,461,000 at March 31, 2016 and $23,115,000 at December 31, 2015) 20,479,134 23,100,106
Total investments 30,047,493 32,991,174
Loans
Real estate 79,191,724 72,756,410
Commercial 18,655,323 20,053,905
Installment 492,884 433,764
Gross loans 98,339,931 93,244,079
Unearned fees and discounts (289,944) (251,911)
Loans net of unearned fees and discount 98,049,987 92,992,168
Allowance for loan losses (1,677,711) (1,667,204)
Net loans 96,372,276 91,324,964
Fixed assets, net 5,949,709 6,021,446
Accrued interest receivable 377,195 395,685
Stock investments, restricted, at cost 1,766,500 1,766,500
Bank-owned life insurance 3,208,819 3,183,247
Other assets 684,373 803,048
Total assets$164,440,572 $161,384,204
LIABILITIES:
Deposits
Non-interest bearing$76,067,362 $74,431,378
Interest bearing
NOW and money market 42,524,879 40,980,418
Savings 4,700,755 4,815,198
Time deposits less than $250,000 3,591,534 3,913,644
Time deposits of $250,000 or greater 6,243,050 6,208,083
Total deposits 133,127,580 130,348,721
Accrued interest payable 25,414 25,229
Borrowings from Federal Home Loan Bank (FHLB) 15,000,000 15,000,000
Accrued expenses & other payables 704,069 843,691
Subordinated notes payable to subsidiary trust 3,093,000 3,093,000
Total liabilities 151,950,063 149,310,641
SHAREHOLDERS' EQUITY
Common stock, authorized 10,000,000 shares with no par value, issued and outstanding 1,026,349 shares at March 31, 2016 and December 31, 2015, respectively. 6,089,466 6,089,466
Retained earnings 6,391,106 6,000,577
Accumulated other comprehensive income 9,937 (16,480)
Total shareholders' equity 12,490,509 12,073,563
Total liabilities & shareholders' equity$164,440,572 $161,384,204

CHINO COMMERCIAL BANCORP
CONSOLIDATED STATEMENTS OF NET INCOME
(unaudited)
For the three months ended
March 31
2016 2015
Interest income
Interest and fee income on loans$1,310,104 $1,185,445
Interest on federal funds sold and FRB deposits 26,333 1,112
Interest on time deposits in banks 10,450 30,195
Interest on investment securities 147,839 80,646
Total interest income 1,494,726 1,297,398
Interest Expense
Interest on deposits 60,347 55,818
Other borrowings 34,251 16,368
Total interest expense 94,598 72,186
Net interest income 1,400,128 1,225,212
Provision for loan losses 1,046 1,458
Net interest income after provision for loan losses 1,399,082 1,223,754
Non-interest income
Service charges on deposit accounts 277,873 306,002
Other miscellaneous income 22,633 18,874
Dividend income from restricted stock 34,881 18,374
Income from bank-owned life insurance 25,572 25,418
Total non-interest income 360,959 368,668
Non-interest expenses
Salaries and employee benefits 680,889 663,539
Occupancy and equipment 103,828 103,001
Data and item processing 94,440 93,338
Advertising and marketing 17,116 11,528
Legal and professional fees 47,430 45,236
Regulatory assessments 30,311 30,519
Insurance 8,471 7,865
Directors' fees and expenses 26,709 26,417
Other expenses 109,023 94,337
Total non-interest expenses 1,118,217 1,075,780
Income before income tax expense 641,824 516,642
Income tax expense 251,294 197,774
Net income$390,530 $318,868
Basic earnings per share$0.38 $0.31
Diluted earnings per share$0.38 $0.31

For the three months ended
March 31
2016 2015
KEY FINANCIAL RATIOS
(unaudited)
Annualized return on average equity 12.68% 11.54%
Annualized return on average assets 0.96% 0.96%
Net interest margin 3.81% 4.16%
Core efficiency ratio 63.50% 67.49%
Net chargeoffs to average loans -0.01% -0.01%
AVERAGE BALANCES
(thousands, unaudited)
Average assets $162,308 $132,848
Average interest-earning assets $147,667 $119,493
Average gross loans $95,183 $86,538
Average deposits $129,679 $112,995
Average equity $12,316 $11,057
CREDIT QUALITY End of period
(unaudited) March 31, 2016 December 31,2015
Non-performing loans $- $-
Non-performing loans to total loans 0.00% 0.00%
Non-performing loans to total assets 0.00% 0.00%
Allowance for loan losses to total loans 1.71% 1.79%
Nonperforming assets as a percentage of total loans and OREO 0.00% 0.00%
Allowance for loan losses to non-performing loans n/a n/a
OTHER PERIOD-END STATISTICS
(unaudited)
Shareholders equity to total assets 7.60% 7.48%
Net Loans to deposits 72.39% 70.06%
Non-interest bearing deposits to total deposits 57.14% 57.10%
Total capital to total risk-weighted assets 15.97% 16.15%
Tier 1 capital to total risk-weighted assets 15.72% 15.82%
Tier 1 leverage ratio 10.25% 9.79%
Common equity tier 1 15.72% 15.82%


Source:Chino Commercial Bancorp