CCBC Chino Commercial Bancorp

Chino Commercial Bancorp Reports 14.5% Increase in Full Year Earnings

Chino Commercial Bancorp Reports 14.5% Increase in Full Year Earnings

CHINO, Calif., Jan. 30, 2020 (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 fourth quarter and year ended December 31, 2019.  Net earnings for the fourth quarter 2019, were $502 thousand, or an decrease of 15.62%, as compared with earnings of $595 thousand for the same quarter last year.  Net earnings for the fiscal year ended December 31, 2019 increased by 14.5% or by $323 thousand to $2.6 million, as compared to $2.2 million for fiscal year 2018.

Net earnings per basic and diluted share was $0.23 for the fourth quarter of 2019 as compared with $0.27 for the same quarter last year.  Net earnings per basic and diluted share was $1.14 for the year ended December 31, 2019, as compared with $1.00 as December 31, 2018, respectively.

Dann H. Bowman, President and Chief Executive Officer, stated: “We are very pleased with the performance of the Bank during 2019.  The Bank set new record levels for total Deposits, total Loans, Revenue and Net Earnings.  The economy of the Inland Empire continues to improve and expand, allowing for continued business growth into the future.  We have a great team, a great market, and we are excited about the prospects for the Company over the next few years.”

Financial Condition

At December 31, 2019, total assets were $230 million, an increase of $27.5 million or 13.6% over $202 million at December 31, 2018.  Total deposits increased by 5.3% or $9 million to $180 million as of December 31, 2019, compared to $171 million as of December 31, 2018. At December 31, 2019, the Company’s core deposits represent 94% of the total deposits.

Gross loans increased by 9.2% or $12 million as of December 31, 2019 to $144 million, as compared with $132 million as of December 31, 2018.  The Bank had one non-performing loan for the quarter ended December 31, 2019, and none as of December 31, 2018.  OREO properties remained at zero as of December 31, 2019 and December 31, 2018 respectively.

Earnings

For the year ended December 31, 2019, net interest income was $8.1 million, an increase of 11.4% or $834 thousand in comparison to $7.3 million as of December 31, 2018. The Company posted net interest income of $1.97 million and $1.93 million for the three months ended December 31, 2019 and 2018 respectively, or an increase of $40 thousand or 2.1%. Average interest-earning assets were $177.3 million with average interest-bearing liabilities of $119.4 million, yielding a net interest margin of 4.41% for the fourth quarter of 2019, as compared to the average interest-earning assets of $179.0 million with average interest-bearing liabilities of $91.5 million, yielding a net interest margin of 4.27% for the fourth quarter of 2018.

For the year ended December 31, 2019, non-interest income was $1.9 million, an increase of 22.9% or $358 thousand in comparison to $1.6 million as of December 31, 2018. Non-interest income totaled $457 thousand for the fourth quarter of 2019, or an increase of 7.6% as compared with $424 thousand earned during the same quarter last year. Service charges on deposit accounts increased over the fourth quarter by $39.6 thousand or 11.5% to $383 thousand, primarily due to an increase in income from returned items, overdraft charges, and analysis fees. Dividend income from restricted stock decreased to $17 thousand for the fourth quarter of 2019, compared to $35 thousand for the same quarter in 2018, due to the Federal Home Loan Bank and Pacific Coast Bankers Bank changes in dividend payout percentage policy. Income from Bank-owned life insurance increased by $7.2 thousand for the fourth quarter of 2019, compared to $25 thousand for the same quarter in 2018, due to a new life insurance policy added during 2019.

For the year ended December 31, 2019, general and administrative expenses were $6.5 million, an increase of 15.8% or $886 thousand in comparison to $5.6 million as of December 31, 2018. General and administrative expenses were $1.7 million for the three months ended December 31, 2019, and $1.5 million for the same period last year. The largest component of general and administrative expenses was salary and benefits expense of $1 million for the fourth quarter of 2019, as compared to $973 thousand for the same quarter last year and $3.9 million and $3.6 million for the years ended December 2019 and 2018 respectively. Occupancy and equipment increase year over year by $110 thousand due to the opening of our new branch in Upland during the fourth quarter of 2018.

For the year ended December 31, 2019, income tax expense was $985 thousand, a decrease of 10.3% or $92 thousand in comparison to $893 million as of December 31, 2018. Income tax expense was $197 thousand which represents a decrease of $41 thousand or 17.5% for the three months ended December 31, 2019, as compared to $239 thousand for the three months ended December 31, 2018. The effective income tax rate for the fourth quarter of 2019 and 2018 is approximately 28.2% and 28.6% respectively, and for the year ending December 31, 2019 and 2018, the effective income tax rates were 27.8% and 28.6% 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 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 
 December 31, 2019 and December 31, 2018 
   
  December 31, 2019 December 31, 2018 
  (unaudited) (audited) 
 ASSETS:    
 Cash and due from banks$4,363,753  $25,451,866  
 Federal funds sold 32,415,000   -  
 Total cash and cash equivalents 36,778,753   25,451,866  
      
 Interest-bearing deposits in other banks 496,000   1,988,000  
 Investment securities available for sale 7,977,936   5,914,736  
 Investment securities held to maturity (fair value approximates    
 $28,625,251 at December 31, 2019 and $26,092,226 at December 31, 2018) 28,367,056   26,623,343  
 Total investments 36,840,992   34,526,079  
 Loans    
 Construction -   -  
 Real estate 115,633,626   107,902,821  
 Commercial 28,522,543   24,029,989  
 Installment 232,328   241,077  
 Gross loans 144,388,497   132,173,887  
 Unearned fees and discounts (438,380)  (345,054) 
 Loans net of unearned fees and discount 143,950,117   131,828,833  
 Allowance for loan losses (2,391,765)  (2,292,478) 
  Net loans 141,558,352   129,536,355  
      
 Fixed assets, net 6,401,773   6,063,350  
 Accrued interest receivable 619,856   585,506  
 Stock investments, restricted, at cost 1,440,900   1,248,400  
 Bank-owned life insurance 4,595,584   3,484,885  
 Other assets 1,270,936   1,091,805  
 Total assets$229,507,146  $201,988,246  
      
 LIABILITIES:    
 Deposits    
 Non-interest bearing$88,412,668  $83,237,014  
 Interest bearing    
 NOW and money market 64,520,387   66,046,085  
 Savings 12,209,281   9,870,263  
 Time deposits less than $250,000 9,537,555   4,191,717  
 Time deposits of $250,000 or greater 5,471,451   7,674,742  
 Total deposits 180,151,342   171,019,821  
      
 Accrued interest payable 203,246   64,794  
 Borrowings from Federal Home Loan Bank (FHLB) 20,000,000   5,000,000  
 Accrued expenses & other payables 1,686,981   1,101,417  
 Subordinated notes payable to subsidiary trust 3,093,000   3,093,000  
 Total liabilities 205,134,569   180,279,032  
      
 SHAREHOLDERS' EQUITY    
 Common stock, authorized 10,000,000 shares with no par value, issued and outstanding 2,230,808 shares at December 31, 2019 and December 31, 2018, respectively.    
     
  10,502,557   10,502,557  
 Retained earnings 13,803,528   11,251,915  
 Accumulated other comprehensive income/(loss) 66,492   (45,258) 
 Total shareholders' equity 24,372,577   21,709,214  
 Total liabilities & shareholders' equity$229,507,146  $201,988,246  
      



          
 CHINO COMMERCIAL BANCORP 
 CONSOLIDATED STATEMENTS OF NET INCOME 
   
  For the three months ended For the year ended 
  December 31 December 31 
   2019   2018  2019  2018 
  (unaudited) (unaudited) (unaudited) (audited) 
 Interest income      
 Interest and fee income on loans$1,982,610  $1,828,378 $7,884,573 $7,012,709 
 Interest on federal funds sold and FRB deposits 184,875   104,132  510,650  422,577 
 Interest on time deposits in banks 3,219   12,151  35,077  27,899 
 Interest on investment securities 167,707   204,829  1,078,908  659,707 
 Total interest income 2,338,411   2,149,490  9,509,208  8,122,892 
          
 Interest Expense        
 Interest on deposits 230,243   189,493  935,215  612,912 
 Other borrowings 139,476   31,785  413,749  183,636 
 Total interest expense 369,719   221,278  1,348,964  796,548 
 Net interest income 1,968,692   1,928,212  8,160,244  7,326,344 
 Provision for loan losses -   -  40,000  150,000 
          
 Net interest income after provision for loan losses 1,968,692   1,928,212  8,120,244  7,176,344 
          
 Non-interest income        
 Service charges on deposit accounts 382,839   343,216  1,530,853  1,262,496 
 Other miscellaneous income 24,567   21,159  190,567  86,647 
 Dividend income from restricted stock 17,267   35,101  88,281  115,362 
 Income from bank-owned life insurance 31,901   24,666  110,699  98,130 
 Total non-interest income 456,574   424,142  1,920,400  1,562,635 
          
 Non-interest expenses        
 Salaries and employee benefits 1,002,259   973,047  3,941,211  3,568,823 
 Occupancy and equipment 155,473   155,086  632,501  522,458 
 Data and item processing 123,409   102,410  469,176  390,485 
 Advertising and marketing 30,867   7,075  97,035  90,359 
 Legal and professional fees 217,088   37,955  430,050  150,218 
 Regulatory assessments (12,940)  34,435  81,578  135,419 
 Insurance 10,295   9,032  37,911  35,599 
 Directors' fees and expenses 32,742   29,266  137,142  117,710 
 Other expenses 166,708   169,824  675,289  604,653 
 Total non-interest expenses 1,725,901   1,518,130  6,501,893  5,615,724 
 Income before income tax expense 699,365   834,224  3,538,751  3,123,255 
 Income tax expense 196,971   238,860  984,794  892,659 
 Net income$502,394  $595,364 $2,553,957 $2,230,596 
          
 Basic earnings per share$0.23  $0.27 $1.14 $1.00 
 Diluted earnings per share$0.23  $0.27 $1.14 $1.00 
          





           
   For the three months ended For the year ended 
   December 31 December 31 
    2019   2018   2019   2018  
 KEY FINANCIAL RATIOS         
 (unaudited)         
 Annualized return on average equity  8.31%  11.43%  11.03%  12.34% 
 Annualized return on average assets  0.85%  1.22%  1.17%  1.16% 
 Net interest margin  4.41%  4.27%  4.46%  4.14% 
 Core efficiency ratio  71.16%  64.54%  64.50%  63.18% 
 Net chargeoffs/(recoveries) to average loans  0.002%  -0.013%  -0.05%  -0.02% 
           
 AVERAGE BALANCES         
 (thousands, unaudited)         
 Average assets $235,723  $195,986  $219,167  $193,120  
 Average interest-earning assets $177,259  $179,009  $183,108  $176,829  
 Average gross loans $136,963  $129,717  $136,504  $127,705  
 Average deposits $186,587  $170,063  $179,226  $162,393  
 Average equity $24,182  $20,830  $23,156  $18,074  
           
           
           
 CREDIT QUALITY End of period     
 (unaudited) December 31, 2019 December 31, 2018     
           
 Non-performing loans $120,423  $-      
           
 Non-performing loans to total loans  0.08%  0.00%     
 Non-performing loans to total assets  0.05%  0.00%     
 Allowance for loan losses to total loans  1.66%  1.73%     
 Nonperforming assets as a percentage of total loans and OREO  0.08%  0.00%     
 Allowance for loan losses to non-performing loans  1986.14%  n/a      
           
 OTHER PERIOD-END STATISTICS         
 (unaudited)         
 Shareholders equity to total assets  10.62%  10.75%     
 Net loans to deposits  78.58%  75.74%     
 Non-interest bearing deposits to total deposits  49.08%  48.67%     
 Total capital to total risk-weighted assets  18.30%  19.19%     
 Tier 1 capital to total risk-weighted assets  20.16%  20.93%     
 Tier 1 leverage ratio  13.74%  14.80%     
 Common equity tier 1  20.16%  20.93%     
           
EN
30/01/2020

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