Chino Commercial Bancorp Reports Third Quarter Earnings

CHINO, Calif., Oct. 20, 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 third quarter ended September 30, 2023. Net earnings for the third quarter of 2023, were $1.3 million, which remains consistent with the same quarter last year. Net earnings per basic and diluted share were $0.40 for the third quarter of 2023 and 2022, respectively.

Net earnings year-to-date increased by 8.17% or by $303 thousand, to $3.7 million, as compared to $3.4 million for the same period last year. Net earnings per basic and diluted share was $1.16 for the period ending September 30, 2023 and $1.06 for the same period last year.

Dann H. Bowman, President and Chief Executive Officer, stated, “The Bank’s operating performance in the third quarter and year-to-date was very strong. Loan quality remains solid,with the Bank having only one delinquent loan at quarter-end, and revenue was up significantly over the same period last year. Total assets reached an all time record in the third quarter, and we are optimistic about additional 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 September 30, 2023, total assets were $465.8 million, an increase of $65.9 million or 16.49% over $399.8 million at December 31, 2022. Total deposits increased by $3.9 million or 1.2% to $341.4 million as of September 30, 2023, compared to $337.5 million as of December 31, 2022. At September 30, 2022, the Company’s core deposits represent 97.8% of the total deposits.

Gross loans decreased by $2.9 million or 1.65% to $178.2 million as of September 30, 2022, compared to $181.2 million as of December 31, 2022. The Bank had three non-performing loans for the quarter ended September 30, 2023, and two non-performing loans as of December 31, 2022. OREO properties remained at zero as of September 30, 2023 and December 31, 2022 respectively.

Earnings

The Company posted net interest income of $3.3 million for the three months ended September 30, 2023 and for the same quarter last year, respectively. Average interest-earning assets were $442.9 million with average interest-bearing liabilities of $235.8 million, yielding a net interest margin of 3.01% for the third quarter of 2023, as compared to the average interest-earning assets of $391.6 million with average interest-bearing liabilities of $163.2 million, yielding a net interest margin of 3.41% for the third quarter of 2022.

Non-interest income totaled $673.0 thousand for the third quarter of 2023, or an increase of 16.12% as compared with $579.6 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 September 30, 2023, and $2.0 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 third quarter of 2023 and $1.3 million for the same period last year.

Income tax expense was $503 thousand, which represents an decrease of $3 thousand or 0.6% for the three months ended September 30, 2023, as compared to $506 thousand for the three months ended September 30, 2022. The effective income tax rate for the third quarter of 2022 was approximately 28.3%, and 28.5% for the same quarter last year.

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, [phone].

Chino Commercial Bankcorp and Subsidiary
Consolidated Statements of Financial Condition
	As of
	9/30/2023				12/31/2022
	unaudited				audited
Assets
Cash and due from banks	$	104,561,071			$	36,436,018
Cash and cash equivalents		104,561,071				36,436,018
Fed Funds Sold		2,300				-
		2,300				-
Investment securities available for sale, net of zero allowance for credit losses		6,087,441				6,347,231
Investment securities held to maturity, net of zero allowance for credit losses		161,749,315				160,668,959
Total Investments		167,836,756				167,016,191
Loans held for investment, net of allowance for credit losses of $4,444,904 in 2023, and $4,100,516 in 2022		173,224,506				176,555,783
Stock investments, restricted, at cost		3,126,100				2,045,200
Fixed assets, net		5,515,355				5,626,850
Accrued interest receivable		1,286,041				1,153,613
Bank owned life insurance		8,197,290				8,054,491
Other assets		2,021,278				2,947,830
Total assets	$	465,770,697			$	399,835,974
Liabilities
Deposits
Noninterest-bearing		185,148,633				204,189,323
Interest-bearing		156,230,416				133,263,940
Total deposits		341,379,049				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		1,569,455				124,947
Other liabilities		1,986,510				1,815,062
Total liabilities		430,028,014				367,486,270
Shareholders' Equity
Common stock, no par value, 10,000,000 shares authorized and 3,211,981 shares issued and outstanding at September 30, 2023 and December 31, 2022		10,502,558				10,502,558
Retained earnings		27,694,744				24,269,527
Accumulated other comprehensive loss - unrecognized loss on available for sale, net of taxes		(2,454,619	)			(2,422,382	)
Total shareholders' equity		35,742,683				32,349,703
Total liabilities and shareholders' equity	$	465,770,697			$	399,835,974

Chino Commercial Bankcorp and Subsidiary
Consolidated Statements of Net Income
	For the three month ended								For the nine month ended
	30-Sep								30-Sep
		2023				2022				2023				2022
	(unaudited)				(unaudited)				(unaudited)				(unaudited)
Interest Income
Interest and fees on loans		2,467,400				2,289,166				7,245,563				7,193,378
Interest on investment securities		1,166,387				1,004,274				3,444,135				2,196,498
Other interest income		1,410,450				344,108				2,990,487				580,703
Total interest income		5,044,237				3,637,548				13,680,184				9,970,579
Interest Expense
Interest on deposits		841,282				86,555				1,835,134				177,876
Interest on borrowings		877,179				222,041				2,112,955				641,264
Total interest expense		1,718,460				308,597				3,948,089				819,140
Net Interest Income		3,325,776				3,328,951				9,732,096				9,151,439
Provision For Loan Losses		6,578				93,457				(81,806	)			135,987
Net Interest Income After Provision For Loan Losses		3,319,198				3,235,495				9,813,901				9,015,452
Noninterest Income
Service charges and fees on deposit accounts		424,453				324,008				1,184,329				943,114
Interchange fees		106,418				130,022				314,803				364,397
Earnings from bank-owned life insurance		48,677				46,724				142,799				135,876
Other miscellaneous income		93,502				78,876				271,651				209,345
Total noninterest income		673,049				579,630				1,913,582				1,652,732
Noninterest Expense
Salaries and employee benefits		1,381,721				1,266,765				4,101,388				3,702,106
Occupancy and equipment		156,317				166,159				460,390				478,881
Other expenses		674,654				603,331				1,984,139				1,729,437
Total noninterest expense		2,212,691				2,036,255				6,545,917				5,910,424
Income before income tax expense		1,779,556				1,778,870				5,181,566				4,757,760
Provision for income taxes		503,424				506,530				1,470,859				1,350,354
Net Income	$	1,276,132			$	1,272,340			$	3,710,707			$	3,407,406
Basic earnings per share	$	0.40			$	0.40			$	1.16			$	1.06
Diluted earnings per share	$	0.40			$	0.40			$	1.16			$	1.06

Chino Commercial Bankcorp and Subsidiary
Financial Highlights
	For the three month ended
	30-Sep								30-Sep
Key Financial Ratios		2023				2022				2023				2022
(unaudited)
Annualized return on average equity		14.46	%			16.62	%			14.53	%			15.20	%
Annualized return on average assets		1.10	%			1.23	%			1.13	%			1.13	%
Net interest margin		3.01	%			3.41	%			3.11	%			3.21	%
Core efficiency ratio		55.33	%			52.10	%			56.21	%			54.71	%
Net chargeoffs/(recoveries) to average loans		0.001	%			-0.008	%			-0.017	%			-0.031	%
Average Balances
(thousands, unaudited)
Average assets		463,977				413,023				439,669				402,883
Average interest-earning assets		442,867				391,582				418,587				381,264
Average interest-bearing liabilities		235,812				163,224				209,835				157,915
Average gross loans		178,251				176,252				179,089				175,436
Average deposits		340,261				352,419				333,225				342,936
Average equity		35,312				30,614				34,046				29,887
	End of period
	9/30/2023				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		2.50	%			2.26	%
Nonperforming assets as a percentage of total loans and OREO		0.29	%			0.22	%
Allowance for credit losses to non-performing loans		854.56	%			1014.74	%
Other Period-end Statistics
Shareholders equity to total assets		7.67	%			7.92	%
Net loans to deposits		50.74	%			52.32	%
Non-interest bearing deposits to total deposits		54.24	%			60.51	%
Company Leverage Ratio		8.90	%			8.12	%