CHINO, Calif., April 20, 2018 (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, 2018, with net earnings of $509 thousand, or an increase of 23.5%, compared with net income of $412 thousand for the same quarter last year. Net income per basic and diluted share was $0.33 for both the first quarter of 2018 and 2017, respectively.
Dann H. Bowman, President and Chief Executive Officer, stated, “In addition to the excellent first quarter earnings results, the Bank was recently recognized by the Findley Reports on Financial Institutions by receiving their highest rating of 'Super Premier Performing.' We are also very pleased that the Bank was included in the American Banker’s Association list of the 'Top 200 Community Banks in America' ranking number 65 on the list.
"The Bank recently received approval from the Office of the Comptroller of the Currency to establish a fourth branch office in Upland. We are excited about expanding into this community, which we believe will significantly contribute to the Company’s growth and profitability.”
Financial Condition
At March 31, 2018, total assets were $198.1 million, an increase of $5.3 million or 2.8% over $192.8 million at December 31, 2017. Total deposits increased by 6.6% or $9.8 million during the first quarter to $158.9 million, compared to $149.1 million as of December 31, 2017. At March 31, 2018, the Company’s core deposits represent 92.4% of the total deposits.
Gross loans increased by 3.4% or $4.2 million as of March 31, 2018 to $126.8 million, as compared with $122.6 million as of December 31, 2017. The Bank did not have any nonperforming loans for the quarter ended March 31, 2017, and as of December 31, 2017, respectively. OREO properties remained at zero as of March 31, 2018 and December 31, 2017, respectively.
Earnings
The Company posted net interest income of $1.7 million and $1.5 million for the three months ended March 31, 2018 and 2017, respectively, or an increase of $198 thousand or 12.9%. Average interest-earning assets were $173.5 million with average interest-bearing liabilities of $91.0 million, yielding a net interest margin of 4.03% for the first quarter of 2018, as compared to the average interest-earning assets of $164.8 million with average interest-bearing liabilities of $97.1 million, yielding a net interest margin of 3.76% for the first quarter of 2017.
Non-interest income totaled $387 thousand for the first quarter of 2018, or a increase of 1.8% as compared with $380 thousand earned during the same quarter last year. Service charges on deposit accounts increased by $15.3 thousand or 5.3% to $307 thousand, primarily due to an increase in income from returned items, overdraft charges, and analysis fees. Dividend income from restricted stock decreased to $35.8 thousand for the first quarter of 2018, compared to $45 thousand for the same quarter in 2017, due to the Federal Home Loan Bank change in dividend payout percentage policy. Income from Bank-owned life insurance remained consistent at about $25 thousand in the first quarter of 2018 and 2017, respectively.
General and administrative expenses were $1.4 million for the three months ended March 31, 2017, and 1.2 million for the same period last year. The largest component of general and administrative expenses was salary and benefits expense of $869 thousand for the first quarter of 2018, as compared to $745 thousand for the same quarter last year. Advertising and marketing expenses increased by $7 thousand or 30.9% to $29 thousand in the first quarter of 2018 from $22 thousand for the same period last year.
Income tax expense was $203 thousand which represents a decrease of $65 thousand or 24% for the three months ended March 31, 2018 as compared to $267 thousand for the three months ended March 31, 2017. The effective income tax rate for the first quarter of 2017 and 2016 is approximately 28.5% and 39.3%, respectively. The decrease in the income tax expense as well as the effective tax rate is entirely attributed to the new Tax Reform Act signed into law in December 2017.
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 therefrom, and 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 | |||||||
| March 31, 2018 and December 31, 2017 | |||||||
| March 31, 2018 | December 31, 2017 | ||||||
| (unaudited) | (audited) | ||||||
| ASSETS: | |||||||
| Cash and due from banks | 37,488,043 | $ | 34,157,668 | ||||
| Total cash and cash equivalents | 37,488,043 | 34,157,668 | |||||
| Interest-bearing deposits in other banks | 744,000 | 1,240,000 | |||||
| Investment securities available for sale | 2,929,904 | 3,131,027 | |||||
| Investment securities held to maturity (fair value approximates | |||||||
| $20,068,000 at March 31, 2018 and $21,104,000 at December 31, 2017) | 20,726,857 | 21,389,552 | |||||
| Total investments | 24,400,761 | 25,760,579 | |||||
| Loans | |||||||
| Real estate | 104,724,567 | 99,585,847 | |||||
| Commercial | 21,756,742 | 22,679,268 | |||||
| Installment | 308,481 | 337,455 | |||||
| Gross loans | 126,789,790 | 122,602,570 | |||||
| Unearned fees and discounts | (384,347 | ) | (365,091 | ) | |||
| Loans net of unearned fees and discount | 126,405,443 | 122,237,479 | |||||
| Allowance for loan losses | (2,145,396 | ) | (2,094,723 | ) | |||
| Net loans | 124,260,047 | 120,142,756 | |||||
| Fixed assets, net | 5,829,474 | 5,875,381 | |||||
| Accrued interest receivable | 511,297 | 531,771 | |||||
| Stock investments, restricted, at cost | 1,239,868 | 2,084,129 | |||||
| Bank-owned life insurance | 3,411,207 | 3,386,754 | |||||
| Other assets | 967,735 | 861,969 | |||||
| Total assets | $ | 198,108,432 | $ | 192,801,007 | |||
| LIABILITIES: | |||||||
| Deposits | |||||||
| Non-interest bearing | $ | 84,354,239 | $ | 74,766,694 | |||
| Interest bearing | |||||||
| NOW and money market | 52,263,317 | 47,030,167 | |||||
| Savings | 8,510,025 | 7,897,948 | |||||
| Time deposits less than $250,000 | 6,682,182 | 5,727,789 | |||||
| Time deposits of $250,000 or greater | 7,119,399 | 13,703,790 | |||||
| Total deposits | 158,929,162 | 149,126,388 | |||||
| Accrued interest payable | 40,532 | 65,160 | |||||
| Borrowings from Federal Home Loan Bank (FHLB) | 15,000,000 | 20,000,000 | |||||
| Accrued expenses & other payables | 1,054,844 | 1,012,535 | |||||
| Subordinated notes payable to subsidiary trust | 3,093,000 | 3,093,000 | |||||
| Total liabilities | 178,117,538 | 173,297,083 | |||||
| SHAREHOLDERS' EQUITY | |||||||
| Common stock, authorized 10,000,000 shares with no par value, issued and outstanding 1,549,420 shares at March 31, 2018 and December 31, 2017, respectively. | 10,502,558 | 10,502,558 | |||||
| Retained earnings | 9,529,378 | 9,020,564 | |||||
| Accumulated other comprehensive income/(loss) | (41,042 | ) | (19,198 | ) | |||
| Total shareholders' equity | 19,990,894 | 19,503,924 | |||||
| Total liabilities & shareholders' equity | $ | 198,108,432 | $ | 192,801,007 | |||
| CHINO COMMERCIAL BANCORP | ||||||||
| CONSOLIDATED STATEMENTS OF NET INCOME | ||||||||
| For the three months ended | ||||||||
| March 31 | ||||||||
| 2018 | 2017 | |||||||
| (unaudited) | (unaudited) | |||||||
| Interest income | ||||||||
| Interest and fee income on loans | $ | 1,659,877 | $ | 1,467,711 | ||||
| Interest on federal funds sold and FRB deposits | 97,724 | 60,129 | ||||||
| Interest on time deposits in banks | 3,956 | 7,057 | ||||||
| Interest on investment securities | 140,573 | 122,745 | ||||||
| Total interest income | 1,902,130 | 1,657,642 | ||||||
| Interest Expense | ||||||||
| Interest on deposits | 87,244 | 75,841 | ||||||
| Other borrowings | 89,636 | 54,132 | ||||||
| Total interest expense | 176,880 | 129,973 | ||||||
| Net interest income | 1,725,250 | 1,527,669 | ||||||
| Provision for loan losses | 50,000 | 55,000 | ||||||
| Net interest income after provision for loan losses | 1,675,250 | 1,472,669 | ||||||
| Non-interest income | ||||||||
| Service charges on deposit accounts | 307,037 | 291,643 | ||||||
| Other miscellaneous income | 19,196 | 18,110 | ||||||
| Dividend income from restricted stock | 35,834 | 45,081 | ||||||
| Income from bank-owned life insurance | 24,453 | 25,022 | ||||||
| Total non-interest income | 386,520 | 379,856 | ||||||
| Non-interest expenses | ||||||||
| Salaries and employee benefits | 868,915 | 744,775 | ||||||
| Occupancy and equipment | 114,656 | 105,532 | ||||||
| Data and item processing | 91,636 | 76,081 | ||||||
| Advertising and marketing | 28,586 | 21,844 | ||||||
| Legal and professional fees | 33,198 | 37,434 | ||||||
| Regulatory assessments | 33,128 | 37,610 | ||||||
| Insurance | 8,559 | 8,005 | ||||||
| Directors' fees and expenses | 30,759 | 26,548 | ||||||
| Other expenses | 140,986 | 115,704 | ||||||
| Total non-interest expenses | 1,350,423 | 1,173,533 | ||||||
| Income before income tax expense | 711,347 | 678,992 | ||||||
| Income tax expense | 202,534 | 267,078 | ||||||
| Net income | $ | 508,813 | $ | 411,914 | ||||
| Basic earnings per share | $ | 0.33 | $ | 0.33 | ||||
| Diluted earnings per share | $ | 0.33 | $ | 0.33 | ||||
| Tax rate | 28.5 | % | 39.3 | % | ||||
| For the three months ended | |||||||||
| March 31 | |||||||||
| 2018 | 2017 | ||||||||
| KEY FINANCIAL RATIOS | |||||||||
| (unaudited) | |||||||||
| Annualized return on average equity | 10.27 | % | 11.94 | % | |||||
| Annualized return on average assets | 1.02 | % | 0.92 | % | |||||
| Net interest margin | 4.03 | % | 3.76 | % | |||||
| Core efficiency ratio | 63.95 | % | 61.52 | % | |||||
| Net chargeoffs/(recoveries) to average loans | -0.01 | % | -0.01 | % | |||||
| AVERAGE BALANCES | |||||||||
| (thousands, unaudited) | |||||||||
| Average assets | $ | 199,089 | $ | 179,168 | |||||
| Average interest-earning assets | $ | 173,525 | $ | 164,802 | |||||
| Average gross loans | $ | 122,699 | $ | 110,136 | |||||
| Average deposits | $ | 147,053 | $ | 139,925 | |||||
| Average equity | $ | 19,822 | $ | 13,794 | |||||
| CREDIT QUALITY | End of period | ||||||||
| (unaudited) | March 31, 2018 | December 31, 2017 | |||||||
| 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 | 1.69 | % | 1.71 | % | |||||
| 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 | 10.09 | % | 10.12 | % | |||||
| Net loans to deposits | 78.19 | % | 80.56 | % | |||||
| Non-interest bearing deposits to total deposits | 53.08 | % | 50.14 | % | |||||
| Total capital to total risk-weighted assets | 18.39 | % | 18.43 | % | |||||
| Tier 1 capital to total risk-weighted assets | 19.79 | % | 19.76 | % | |||||
| Tier 1 leverage ratio | 14.17 | % | 13.41 | % | |||||
| Common equity tier 1 | 19.79 | % | 19.76 | % | |||||