Chino Commercial Bancorp Reports 5% Increase In Second Quarter Earnings


CHINO, Calif., July 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 second quarter ended June 30, 2016 with net earnings of $371,840, or an increase of 5.2%, compared with net income of $353,552 for the same quarter last year. Net income per basic share for the second quarter of 2016 was $0.30 as compared to $0.29 for the same quarter last year.

Dann H. Bowman, President and Chief Executive Officer, stated, “The second quarter of 2016 marks a new record for the Company with total Deposits, total Loans and total Revenue all reaching new highs.  The competitive market for the Bank is very good and as the economy in Southern California continues to improve we are optimistic regarding the potential for further expansion in our markets. 

Financial Condition

At June 30, 2016, total assets were $178.6 million, an increase of $17.2 million or 10.6% over $161.4 million at December 31, 2015.  Total deposits increased by 8.7% or $11.3 million during the year  to $141.6 million, compared to $130.3 million as of December 31, 2015. At June 30, 2016, the Company’s core deposits represent 95.4% of the total deposits.

Gross loans increased by 10.4% or $9.7 million as of June 30, 2016 to $103.0 million as compared with $93.2 million as of December 31, 2015.  The Bank’s loan quality remained consistent during the second quarter as nonperforming assets and OREO were both at zero as of June 30, 2016, and December 31, 2015, respectively.

Earnings

The Company posted net interest income of $1,460,731 and $1,247,489 for the three months ended June 30, 2016 and 2015, respectively, or an increase of $213,242 or 17.1%. Average interest-earning assets were $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; as compared to the average interest-earning assets of $131.5 million with average interest-bearing liabilities of $67.8 million, yielding a net interest margin of 3.85% for the second quarter of 2015.

Non-interest income totaled $427,800 for the second quarter of 2016, or an increase of 9.8% as compared with $389,686 earned during the same quarter last year. Service charges on deposit accounts decreased 10.8% to $268,928 due to a decrease in income from returned items and overdraft charges. Dividend income from restricted stock decreased to $37,962 for the second quarter of 2016, compared to $43,105 for the same quarter in 2015 due to special dividend payout during the second quarter of 2015 from the Federal Home Loan Bank.  Income from bank-owned life insurance remained consistent at $25,597 in the second quarter of 2016 and $25,525 in the second quarter of 2015.

General and administrative expenses were $1,147,630 for the three months ended June 30, 2016, as compared to $1,061,226 for the second quarter of 2015. The largest component of general and administrative expenses was salary and benefits expense of $706,355 for the second quarter of 2016, as compared to $650,690 for the same quarter last year.  Regulatory assessments increased to $36,539 in the second quarter of 2016 in comparison with $30,683 in the second quarter of 2015.  Advertising and marketing expenses increased 18.1% to $17,426 in the second quarter of 2016 from $14,757 for the same period last year.

Income tax expense was $237,697 for the three months ended June 30, 2016 as compared to $220,057 for the three months ended June 30, 2015. The effective income tax rate for the second quarter of 2016 and 2015 is approximately 39.0% and 38.4%, 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.

CHINO COMMERCIAL BANCORP 
CONSOLIDATED BALANCE SHEET 
June 30, 2016 and December 31, 2015 
  
 June 30, 2016 December 31, 2015 
 (unaudited) (audited) 
ASSETS:    
Cash and due from banks$  34,165,233  $  24,898,140  
Total cash and cash equivalents 34,165,233   24,898,140  
     
Interest-bearing deposits in other banks 4,216,000     4,960,000  
Investment securities available for sale 4,728,757   4,931,068  
Investment securities held to maturity (fair value approximates    
$22,597,000 at June 30, 2016 and $23,115,000 at December 31, 2015) 22,225,641   23,100,106  
Total investments 31,170,398   32,991,174  
Loans    
Real estate 83,972,643   72,756,410  
Commercial 18,509,423   20,053,905  
Installment 488,381   433,764  
Gross loans 102,970,447   93,244,079  
Unearned fees and discounts (353,575)  (251,911) 
Loans net of unearned fees and discount 102,616,872   92,992,168  
Allowance for loan losses (1,749,671)  (1,667,204) 
 Net loans 100,867,201   91,324,964  
     
Fixed assets, net 5,913,364   6,021,446  
Accrued interest receivable 278,256   395,685  
Stock investments, restricted, at cost 1,766,500   1,766,500  
Bank-owned life insurance 3,234,415   3,183,247  
Other assets 1,173,816   803,048  
Total assets$  178,569,183  $  161,384,204  
     
LIABILITIES:    
Deposits    
Non-interest bearing $  84,690,309  $  74,431,378  
Interest bearing    
NOW and money market 42,078,516   40,980,418  
Savings 4,840,621   4,815,198  
Time deposits less than $250,000 3,516,649   3,913,644  
Time deposits of $250,000 or greater 6,511,429   6,208,083  
Total deposits 141,637,524   130,348,721  
     
Accrued interest payable 25,593   25,229  
Borrowings from Federal Home Loan Bank (FHLB)   20,000,000     15,000,000  
Accrued expenses & other payables 934,095   843,691  
Subordinated notes payable to subsidiary trust 3,093,000   3,093,000  
Total liabilities 165,690,212   149,310,641  
     
SHAREHOLDERS' EQUITY    
Common stock, authorized 10,000,000 shares with no par value, issued and outstanding 1,231,332 shares at June 30, 2016 and December 31, 2015, respectively. 6,089,466   6,089,466  
Retained earnings 6,758,873   6,000,577  
Accumulated other comprehensive income/(loss) 30,632   (16,480) 
Total shareholders' equity 12,878,971   12,073,563  
Total liabilities & shareholders' equity$  178,569,183  $  161,384,204  
     

 

CHINO COMMERCIAL BANCORP 
CONSOLIDATED STATEMENTS OF NET INCOME 
(unaudited) 
  
 For the three months ended For the year ended 
 June 30 June 30 
  2016   2015   2016   2015  
Interest income        
Interest and fee income on loans $  1,382,543  $  1,202,183  $  2,692,647  $  2,387,628  
Interest on federal funds sold and FRB deposits   26,703     10,102     53,036     11,214  
Interest on time deposits in banks   9,929     22,994     20,379     53,189  
Interest on investment securities   140,819     89,933     288,658     170,579  
Total interest income 1,559,994   1,325,212   3,054,720   2,622,610  
         
Interest Expense        
Interest on deposits 65,082   57,621   125,430   113,439  
Other borrowings 34,181   20,102   68,432   36,470  
Total interest expense 99,263   77,723   193,862   149,909  
Net interest income 1,460,731   1,247,489   2,860,858   2,472,701  
Provision for loan losses 131,364   2,340   131,364   3,798  
         
Net interest income after provision for loan losses 1,329,367   1,245,149   2,729,494   2,468,903  
         
Non-interest income        
Service charges on deposit accounts 268,928   301,395   546,801   607,397  
Other miscellaneous income 95,313   19,661   117,946   38,535  
Dividend income from restricted stock 37,962   43,105   72,843   61,479  
Income from bank-owned life insurance 25,597   25,525   51,168   50,943  
Total non-interest income 427,800   389,686   788,758   758,354  
         
Non-interest expenses        
Salaries and employee benefits 706,355   650,690   1,387,244   1,314,229  
Occupancy and equipment 99,125   99,280   202,953   202,281  
Data and item processing 95,226   96,081   189,667   189,419  
Advertising and marketing 17,426   14,757   34,542   26,285  
Legal and professional fees 40,101   37,390   87,531   82,626  
Regulatory assessments 36,539   30,683   66,850   61,202  
Insurance 8,539   8,471   17,010   16,336  
Directors' fees and expenses 27,129   27,663   53,839   54,080  
Other expenses 117,190   96,211   226,211   190,547  
Total non-interest expenses 1,147,630   1,061,226   2,265,847   2,137,005  
Income before income tax expense 609,537   573,609   1,252,405   1,090,252  
Income tax expense 237,697   220,057   488,991   417,831  
Net income$  371,840  $  353,552  $  763,414  $  672,421  
         
Basic earnings per share $  0.30  $  0.29  $  0.62  $  0.55  
Diluted earnings per share $  0.30  $  0.29  $  0.62  $  0.55  
         

 

  For the three months ended For the year ended 
  June 30 June 30 
   2016   2015   2016   2015  
KEY FINANCIAL RATIOS         
(unaudited)         
Annualized return on average equity  11.70%  12.64%  24.40%  24.04% 
Annualized return on average assets  0.90%  0.97%  1.86%  1.93% 
Net interest margin  3.93%  3.85%  7.77%  7.99% 
Core efficiency ratio  60.77%  64.82%  62.08%  66.14% 
Net chargeoffs/(recoveries) to average loans  0.06%  -0.01%  0.05%  -0.02% 
          
AVERAGE BALANCES         
(thousands, unaudited)         
Average assets $  165,504  $  145,442  $  163,906  $  139,180  
Average interest-earning assets $  149,635  $  131,473  $  148,096  $  125,516  
Average gross loans $  98,736  $  87,189  $  96,382  $  86,865  
Average deposits $  132,349  $  119,383  $  131,014  $  116,207  
Average equity $  12,717  $  11,321  $  12,516  $  11,190  
          
          
          
CREDIT QUALITY End of period     
(unaudited) June 30, 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  1.70%  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  7.21%  7.48%     
Net Loans to deposits  71.22%  70.06%     
Non-interest bearing deposits to total deposits  59.79%  57.10%     
Total capital to total risk-weighted assets  15.43%  16.15%     
Tier 1 capital to total risk-weighted assets  15.23%  15.82%     
Tier 1 leverage ratio  10.34%  9.79%     
Common equity tier 1  15.23%  15.82%     
          



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