Chino Commercial Bancorp Reports Second Quarter Earnings

CHINO, Calif., July 21, 2023 (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, 2023. Net earnings for the second quarter of 2023, were $1.3 million, or an increase of 2.53%, as compared with earnings of $1.2 million for the same quarter last year. Net earnings per basic and diluted share was $0.39 for the second quarter of 2023, and $0.38 for the same quarter last year.

Net earnings year to date increased by 12.3% or by $300 thousand to $2.4 million, as compared to $2.1 million for the same period last year. Net earnings per basic and diluted share was $0.76 for the period ending June 30, 2023 and $0.76 for the same period last year.

Dann H. Bowman, President and Chief Executive Officer, stated, “The fundamentals of the Company remain strong, with the Bank having only one delinquent loan at quarter-end, and revenue up significantly over the same period last year. The Net Interest Margin for the Bank, as a percent, has contracted slightly as deposits re-price faster than earning assets, however, this compression has been partially overcome through increased total assets. In general, we are optimistic about the opportunities for growth and expansion over the next several years. We believe the economic engine of the Inland Empire is strong and diverse, and the Bank is well positioned to help small business customers in our market.”

Financial Condition

At June 30, 2023, total assets were $453.4 million, an increase of $53.5 million or 13.4% over $399.8 million at December 31, 2022. Total deposits decreased by $6.7 million or 2.0% to $330.8 million as of June 30, 2023, compared to $337.5 million as of December 31, 2022. At June 30, 2022, the Company’s core deposits represent 97.7% of the total deposits.

Gross loans decreased by $4.3 million or 2.37% to $177.0 million as of June 30, 2022, compared to $181.2 million as of December 31, 2022. The Bank had three non-performing loans for the quarter ended June 30, 2023, and two non-performing loans as of December 31, 2022.   OREO properties remained at zero as of June 30, 2023 and December 31, 2022 respectively.  

Earnings

The Company posted net interest income of $3.2 million for the three months ended June 30, 2023 and $3.3 million for the same quarter last year. The decrease is primarily attributed to non-reoccurring PPP loan fees recognized in the second quarter of 2022. Average interest-earning assets were $431.5 million with average interest-bearing liabilities of $224.3 million, yielding a net interest margin of 3.00% for the second quarter of 2023, as compared to the average interest-earning assets of $383.4 million with average interest-bearing liabilities of $157.5 million, yielding a net interest margin of 3.48% for the second quarter of 2022.

Non-interest income totaled $645.8 thousand for the second quarter of 2023, or an increase of 15.10% as compared with $561.0 thousand earned during the same quarter last year. The majority of the increase is attributed to service charges on deposit accounts and other fees.

General and administrative expenses were $2.2 million for the three months ended June 30, 2023, and $1.9 million for the same period last year. The largest component of general and administrative expenses was salary and benefits expense of $1.4 million for the second quarter of 2023 and $1.2 million for the same period last year.

Income tax expense was $504 thousand, which represents an increase of $11 thousand or 2.4% for the three months ended June 30, 2023, as compared to $492 thousand for the three months ended June 30, 2022. The effective income tax rate for the second quarter of 2022 and 2021 were approximately 28.5%, for both periods.

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.

 

Chino Commercial Bankcorp and Subsidiary
Consolidated Statements of Financial Condition
										As of
										6/30/2023					12/31/2022
										unaudited					audited
Assets
	Cash and due from banks									$	99,055,945				$	36,436,018
	Cash and cash equivalents										99,055,945					36,436,018
	Fed Funds Sold										4,647					-
											4,647					-
	Investment securities available for sale , net of zero allowance for credit losses										6,517,757					6,347,231
	Investment securities held to maturity , net of zero allowance for credit losses										155,865,013					160,668,959
	Total Investments										162,382,770					167,016,191
	Loans held for investment, net of allowance for credit losses of
	$4,444,921 in 2023, and $4,100,516 in 2022										172,014,468					176,555,783
	Stock investments, restricted, at cost										3,126,100					2,045,200
	Fixed assets, net										5,518,847					5,626,850
	Accrued interest receivable										1,102,968					1,153,613
	Bank owned life insurance										8,148,613					8,054,491
	Other assets										2,012,556					2,947,830
		Total assets							$	453,366,914				$	399,835,974
Liabilities
	Deposits
	Noninterest-bearing										187,740,177					204,189,323
	Interest-bearing										143,061,127					133,263,940
		Total deposits									330,801,304					337,453,262
	Federal Home Loan Bank advances										15,000,000					15,000,000
	Federal Reserve Bank borrowings										57,000,000					-
	Subordinated debt										10,000,000					10,000,000
	Subordinated notes payable to subsidiary trust										3,093,000					3,093,000
	Accrued interest payable										853,137					124,947
	Other liabilities										1,893,419					1,815,062
		Total liabilities									418,640,860					367,486,270
Shareholders' Equity
	Common stock, no par value, 10,000,000 shares authorized
	and 3,211,981 shares issued and outstanding
	at June 30, 2023 and December 31, 2022										10,502,558					10,502,558
	Retained earnings										26,421,206					24,269,527
	Accumulated other comprehensive loss - unrecognized
	loss on available for sale, net of taxes										(2,197,710	)				(2,422,382	)
		Total shareholders' equity									34,726,053					32,349,703
		Total liabilities and shareholders' equity								$	453,366,914				$	399,835,974

 

Chino Commercial Bankcorp and Subsidiary
Consolidated Statements of Net Income
										For the three month ended							For the six month ended
										30-Jun							30-Jun
											2023				2022			2023				2022
										(unaudited)				(unaudited)			(unaudited)				(unaudited)
Interest Income
	Interest and fees on loans										2,388,004				2,591,015			4,778,163				4,904,212
	Interest on investment securities										1,144,162				842,810			2,277,748				1,192,224
	Other interest income										1,174,803				155,183			1,580,037				236,595
	Total interest income										4,706,968				3,589,007			8,635,948				6,333,031
Interest Expense
	Interest on deposits										616,992				48,804			993,852				91,321
	Interest on borrowings										864,373				212,719			1,235,776				419,222
	Total interest expense										1,481,364				261,522			2,229,628				510,543
Net Interest Income											3,225,604				3,327,485			6,406,320				5,822,488
Provision For Loan Losses											(90,520	)			247,125			(88,384	)			42,530
Net Interest Income After Provision For Loan Losses											3,316,124				3,080,360			6,494,704				5,779,958
Noninterest Income
	Service charges and fees on deposit accounts										399,977				316,619			759,877				619,107
	Interchange fees										105,226				127,618			208,385				234,375
	Earnings from bank-owned life insurance										47,812				45,018			94,123				89,151
	Other miscellaneous income										92,755				71,780			178,149				130,468
	Total noninterest income										645,770				561,035			1,240,533				1,073,101
Noninterest Expense
	Salaries and employee benefits										1,366,733				1,191,030			2,719,668				2,435,342
	Occupancy and equipment										150,482				152,959			304,074				312,722
	Other expenses										675,019				570,640			1,309,485				1,126,106
	Total noninterest expense										2,192,234				1,914,629			4,333,226				3,874,169
Income before income tax expense											1,769,660				1,726,766			3,402,010				2,978,890
Provision for income taxes											503,534				491,913			967,435				843,824
Net Income										$	1,266,126			$	1,234,853		$	2,434,575			$	2,135,066
Basic earnings per share										$	0.39			$	0.38		$	0.76			$	0.66
Diluted earnings per share										$	0.39			$	0.38		$	0.76			$	0.66

 

Chino Commercial Bankcorp and Subsidiary
Financial Highlights
			For the three month ended
Key Financial Ratios			2023			2022			2023			2022
(unaudited)
Annualized return on average equity			14.88	%		16.70	%		14.58	%		14.44	%
Annualized return on average assets			1.12	%		1.22	%		1.14	%		1.07	%
Net interest margin			3.00	%		3.48	%		1.75	%		3.12	%
Core efficiency ratio			56.63	%		49.24	%		56.18	%		56.18	%
Net chargeoffs/(recoveries) to average loans			-0.010	%		-0.011	%		-0.011	%		-0.022	%
Average Balances
(thousands, unaudited)
Average assets			452,401			405,447			427,314			397,719
Average interest-earning assets			431,476			383,414			406,246			376,011
Average interest-bearing liabilities			224,283			157,531			196,631			155,217
Average gross loans			177,412			175,736			179,516			175,021
Average deposits			330,835			345,793			329,648			338,115
Average equity			34,028			29,579			33,402			29,517
			End of period
			6/30/2023			12/31/2022
Credit Quality
Non-performing loans			520,726			404,095
Non-performing loans to total loans			0.29	%		0.22	%
Non-performing loans to total assets			0.11	%		0.10	%
Allowance for credit losses to total loans			2.51	%		2.26	%
Nonperforming assets as a percentage of total loans and OREO			0.29	%		0.22	%
Allowance for credit losses to non-performing loans			853.60	%		1014.74	%
Other Period-end Statistics
Shareholders equity to total assets			7.66	%		7.92	%
Net loans to deposits			52.00	%		52.32	%
Non-interest bearing deposits to total deposits			56.75	%		60.51	%
Company Leverage Ratio			8.85	%		8.12	%