Chino Commercial Bancorp Reports 5.5% Increase in Net Earnings

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| Source: Chino Commercial Bancorp

CHINO, Calif., April 21, 2017 (GLOBE NEWSWIRE) -- The Board of Directors of Chino Commercial Bank, N.A. (OTC:CCBC) announced the results of operations for the quarter ended March 31, 2017 with net income of $411,914, or an increase of 5.5% over net income of $390,530 for March 31, 2016. Net income per basic and diluted share for the quarter ended March 31, 2017 was $0.33 as compared to $0.32 per share for the quarter ended March 31, 2016.   

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.”  The economic strength of the Inland Empire is supporting tremendous growth opportunities for the Bank; and the first quarter marked new record levels for total assets, loans, revenue and net earnings.  In general, this is a very good time for the Bank and we are pleased and excited about the future”

Financial Condition

At March 31, 2017, total assets were $185.3 million, an increase of $10.2 million or 5.9% over $175.1 million at December 31, 2016.  Total deposits increased by 7.2% or $9.9 million during the year to $147.5 million, compared to $137.6 million as of December 31, 2016. At March 31, 2017, the Company’s core deposits represent 97.1% of the total deposits.

Gross loans increased by 3.3% or $3.6 million as of March 31, 2017 to $113.1 million as compared with $109.6 million as of December 31, 2016.  The Bank had one nonperforming loan for the quarter ended March 31, 2017 and December 31, 2016, respectively.  OREO properties remained at zero as of March 31, 2017, and December 31, 2016, respectively.

Earnings

The Company posted net interest income of $1,527,669 and $1,400,128 for the three months ended March 31, 2017 and 2016, respectively, or an increase of $127,541 or 9.1%.  Average interest-earning assets were $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, as compared to the average interest-earning assets of $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.

Non-interest income totaled $379,856 for the first quarter of 2017, or an increase of 5.2% as compared with $360,959 earned during the same quarter last year. Service charges on deposit accounts increased 5.0% to $291,643 primarily due to an increase in income from returned items and overdraft charges. Dividend income from restricted stock increased to $45,081 for the first quarter of 2017, compared to $34,881 for the same quarter in 2016.  Income from bank-owned life insurance remained consistent at $25,022 in the first quarter of 2017 and $25,572 in the first quarter of 2016.

General and administrative expenses were $1,173,533 for the three months ended March 31, 2017, as compared to $1,118,217 for the first quarter of 2017. The largest component of general and administrative expenses was salary and benefits expense of $744,775 for the first quarter of 2017, as compared to $680,889 for the same quarter last year.  Regulatory assessments increased to $37,610 in the first quarter of 2017 in comparison with $30,311 in the first quarter of 2016.  Advertising and marketing expenses increased 27.6% to $21,844 in the first quarter of 2017 from $17,116 for the same period last year.

Income tax expense was $267,078 for the three months ended March 31, 2017 as compared to $251,294 for the three months ended March 31, 2016. The effective income tax rate for the first quarter of 2016 and 2015 is approximately 39.3% and 39.2%, 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.

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, 2017 and December 31, 2016 
     
 March 31, 2017 December 31, 2016 
 (unaudited) (audited) 
ASSETS:    
Cash and due from banks 37,139,627  $30,498,888  
Total cash and cash equivalents 37,139,627   30,498,888  
     
Interest-bearing deposits in other banks 2,232,000   2,480,000  
Investment securities available for sale 3,753,782   3,924,102  
Investment securities held to maturity (fair value approximates    
$19,042,472 at March 31, 2017 and $18,240,000 at December 31, 2016) 19,191,568   18,407,741  
Total investments 25,177,350   24,811,843  
Loans    
Real estate 93,882,650   87,306,627  
Commercial 18,844,416   21,822,341  
Installment 399,330   424,818  
Gross loans 113,126,396   109,553,786  
Unearned fees and discounts (352,799)  (348,359) 
Loans net of unearned fees and discount 112,773,597   109,205,427  
Allowance for loan losses (1,908,975)  (1,845,447) 
 Net loans 110,864,622   107,359,980  
     
Fixed assets, net 5,946,157   6,000,404  
Accrued interest receivable 281,885   295,102  
Stock investments, restricted, at cost 1,935,300   1,935,300  
Bank-owned life insurance 3,310,986   3,285,963  
Other assets 678,908   904,338  
Total assets$185,334,835  $175,091,818  
     
LIABILITIES:    
Deposits    
Non-interest bearing $72,583,231  $68,613,998  
Interest bearing    
NOW and money market 58,354,775   52,873,006  
Savings 5,890,136   5,165,730  
Time deposits less than $250,000 6,314,105   4,438,254  
Time deposits of $250,000 or greater 4,319,520   6,471,260  
Total deposits 147,461,767   137,562,248  
     
Accrued interest payable 30,673   27,902  
Borrowings from Federal Home Loan Bank (FHLB) 20,000,000   20,000,000  
Accrued expenses & other payables 807,039   872,374  
Subordinated notes payable to subsidiary trust 3,093,000   3,093,000  
Total liabilities 171,392,479   161,555,524  
     
SHAREHOLDERS' EQUITY    
Common stock, authorized 10,000,000 shares with no par value, issued and outstanding 1,231,332 shares at March 31, 2017 and December 31, 2016, respectively.    
    
 6,089,466   6,089,466  
Retained earnings 7,861,522   7,449,608  
Accumulated other comprehensive income/(loss) (8,632)  (2,780) 
Total shareholders' equity 13,942,356   13,536,294  
Total liabilities & shareholders' equity$185,334,835  $175,091,818  
     

 

  
CHINO COMMERCIAL BANCORP 
CONSOLIDATED STATEMENTS OF NET INCOME 
(unaudited) 
 For the three months ended 
 March 31 
  2017   2016  
Interest income    
Interest and fee income on loans $1,467,711  $1,310,104  
Interest on federal funds sold and FRB deposits 60,129   26,333  
Interest on time deposits in banks 7,057   10,450  
Interest on investment securities 122,745   147,839  
Total interest income 1,657,642   1,494,726  
     
Interest Expense    
Interest on deposits 75,841   60,347  
Other borrowings 54,132   34,251  
Total interest expense 129,973   94,598  
Net interest income 1,527,669   1,400,128  
Provision for loan losses 55,000   1,046  
     
Net interest income after provision for loan losses 1,472,669   1,399,082  
     
Non-interest income    
Service charges on deposit accounts 291,643   277,873  
Other miscellaneous income 18,110   22,633  
Dividend income from restricted stock 45,081   34,881  
Income from bank-owned life insurance 25,022   25,572  
Total non-interest income 379,856   360,959  
     
Non-interest expenses    
Salaries and employee benefits 744,775   680,889  
Occupancy and equipment 105,532   103,828  
Data and item processing 76,081   77,120  
Advertising and marketing 21,844   17,116  
Legal and professional fees 37,434   47,430  
Regulatory assessments 37,610   30,311  
Insurance 8,005   8,471  
Directors' fees and expenses 26,548   26,709  
Other expenses 115,704   126,343  
Total non-interest expenses 1,173,533   1,118,217  
Income before income tax expense 678,992   641,824  
Income tax expense 267,078   251,294  
Net income$411,914  $390,530  
     
Basic earnings per share $0.33  $0.32  
Diluted earnings per share $0.33  $0.32  
     
Tax rate 39.3%  39.2% 
     

 

    
  For the three months ended 
  March 31 
   2017   2016  
KEY FINANCIAL RATIOS     
(unaudited)     
Annualized return on average equity  12.18%  12.68% 
Annualized return on average assets  0.92%  0.96% 
Net interest margin  3.76%  3.81% 
Core efficiency ratio  61.52%  63.50% 
Net charge offs/(recoveries) to average loans  -0.01%  -0.01% 
      
AVERAGE BALANCES     
(thousands, unaudited)     
Average assets $179,168 $161,960
 
Average interest-earning assets $164,802 $147,688
 
Average gross loans $110,136 $95,183
 
Average deposits $139,925 $129,679
 
Average equity $13,532 $12,316
 
      
      
      
CREDIT QUALITY End of period 
(unaudited) March 31, 2017 December 31, 2016 
      
Non-performing loans $521,696 $-
 
      
Non-performing loans to total loans  0.46%  0.00% 
Non-performing loans to total assets  0.28%  0.00% 
Allowance for loan losses to total loans  1.69%  1.68% 
Nonperforming assets as a percentage of total loans and OREO  0.46%  0.00% 
Allowance for loan losses to non-performing loans  365.92% n/a 
      
OTHER PERIOD-END STATISTICS     
(unaudited)     
Shareholders equity to total assets  7.52%  7.73% 
Net loans to deposits  75.18%  78.04% 
Non-interest bearing deposits to total deposits  49.22%  49.88% 
Total capital to total risk-weighted assets  15.78%  15.37% 
Tier 1 capital to total risk-weighted assets  15.85%  15.32% 
Tier 1 leverage ratio  10.64%  10.24% 
Common equity tier 1  15.85%  15.32%