CHINO, Calif., July 22, 2022 (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, 2022. Net earnings for the second quarter of 2022, were $1.2 million, or an increase of 42.4%, as compared with earnings of $867 thousand for the same quarter last year. Net earnings per basic and diluted share was $0.46 for the second quarter of 2022, and $0.32 for the same quarter last year.
Dann H. Bowman, President and Chief Executive Officer, stated, “Despite the setbacks of the last two years, the economy of the Inland Empire appears to be rebounding. We are excited about the opportunities for growth and expansion of the Bank as we offer new products and services to help small businesses to grow and prosper.”
Financial Condition
At June 30, 2022, total assets were $406.8 million, an increase of $28.3 million or 7.5% over $378.5 million at December 31, 2021. Total deposits increased by $28.2 million or 8.8% to $347.1 million as of June 30, 2022, compared to $318.9 million as of December 31, 2021. At June 30, 2022, the Company’s core deposits represent 98.4% of the total deposits.
Gross loans decreased by 2.1% or $3.7 million as of June 30, 2022 to $172 million as compared with $176.2 million at December 31, 2021, primarily attributed to continued payoffs of PPP loans. The Bank had two non-performing loans for the quarter ended June 30, 2022, and one non-performing loan as of December 31, 2021. OREO properties remained at zero as of June 30, 2022 and December 31, 2021 respectively.
Earnings
The Company posted net interest income of $3.3 million for the three months ended June 30, 2022 and $2.6 million for the same quarter last year. Average interest-earning assets were $385.4 million with average interest-bearing liabilities of $154.5 million, yielding a net interest margin of 3.43% for the second quarter of 2022, as compared to the average interest-earning assets of $326 million with average interest-bearing liabilities of $143.8 million, yielding a net interest margin of 3.17% for the second quarter of 2021.
Non-interest income totaled $594.5.3 thousand for the second quarter of 2022, or an increase of 12.9% as compared with $526.4 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 $1.9 million for the three months ended June 30, 2022, and $1.7 million for the same period last year. The largest component of general and administrative expenses was salary and benefits expense of $1.2 million for the second quarter of 2022 and $1.0 million for the same period last year.
Income tax expense was $492 thousand which represents an increase of $150 thousand or 44% for the three months ended June 30, 2022, as compared to $342 thousand for the three months ended June 30, 2021. The effective income tax rate for the second quarter of 2022 and 2021 were approximately 28.5% and 28.3% 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.
| CHINO COMMERCIAL BANCORP | |||||||
| CONSOLIDATED BALANCE SHEET | |||||||
| June 30, 2022 and 2021 | |||||||
| June 30, 2022 | December 31, 2021 | ||||||
| (unaudited) | (audited) | ||||||
| ASSETS: | |||||||
| Cash and due from banks | $ | 65,532,718 | $ | 135,593,445 | |||
| Federal funds sold | – | – | |||||
| Total cash and cash equivalents | 65,532,718 | 135,593,445 | |||||
| – | |||||||
| Investment securities available for sale | 6,754,523 | 40,270,538 | |||||
| Investment securities held to maturity | 147,370,317 | 12,435,291 | |||||
| Total investments | 154,124,840 | 52,705,829 | |||||
| Loans | |||||||
| Construction | 718,156 | 414,072 | |||||
| Real estate | 139,783,238 | 125,894,826 | |||||
| Commercial | 31,847,131 | 48,133,781 | |||||
| Installment | 138,524 | 1,741,267 | |||||
| Gross loans | 172,487,049 | 176,183,946 | |||||
| Unearned fees and discounts | (605,511 | ) | (1,419,084 | ) | |||
| Loans net of unearned fees and discount | 171,881,538 | 174,764,862 | |||||
| Allowance for loan losses | (3,969,967 | ) | (3,888,480 | ) | |||
| Net loans | 167,911,571 | 170,876,382 | |||||
| Fixed assets, net | 5,760,131 | 5,897,342 | |||||
| Accrued interest receivable | 1,021,469 | 877,104 | |||||
| Stock investments, restricted, at cost | 2,045,200 | 7,871,339 | |||||
| Bank-owned life insurance | 7,960,490 | 2,045,200 | |||||
| Other assets | 2,490,260 | 2,647,812 | |||||
| Total assets | $ | 406,846,679 | $ | 378,514,453 | |||
| LIABILITIES: | |||||||
| Deposits | |||||||
| Non-interest bearing | $ | 214,792,565 | $ | 195,274,304 | |||
| Interest bearing | |||||||
| NOW and money market | 91,053,995 | 85,144,889 | |||||
| Savings | 30,443,494 | 25,147,965 | |||||
| Time deposits less than $250,000 | 8,223,753 | 3,695,546 | |||||
| Time deposits of $250,000 or greater | 2,574,278 | 9,616,481 | |||||
| Total deposits | 347,088,085 | 318,879,185 | |||||
| Accrued interest payable | 117,711 | 130,327 | |||||
| Borrowings from Federal Home Loan Bank (FHLB) | 15,000,000 | 15,000,000 | |||||
| Accrued expenses & other payables | 1,597,793 | 1,817,705 | |||||
| Subordinated debt | 10,000,000 | 10,000,000 | |||||
| Subordinated notes payable to subsidiary trust | 3,093,000 | 3,093,000 | |||||
| Total liabilities | 376,896,589 | 348,920,217 | |||||
| SHAREHOLDERS’ EQUITY | |||||||
| Common stock, authorized 10,000,000 shares with no par value, issued and outstanding 2,676,799 shares at June 30, 2022 and December 31, 2021, respectively. | 10,502,558 | 10,502,557 | |||||
| Retained earnings | 21,691,938 | 19,556,872 | |||||
| Accumulated other comprehensive income/(loss) | (2,244,406 | ) | (465,193 | ) | |||
| Total shareholders’ equity | 29,950,090 | 29,594,236 | |||||
| Total liabilities & shareholders’ equity | $ | 406,846,679 | $ | 378,514,453 | |||
| CHINO COMMERCIAL BANCORP | |||||||||||
| CONSOLIDATED STATEMENTS OF NET INCOME | |||||||||||
| For the three months ended | For the six months ended | ||||||||||
| June 30 | June 30 | ||||||||||
| 2022 | 2021 | 2022 | 2021 | ||||||||
| (unaudited) | (unaudited) | (unaudited) | (unaudited) | ||||||||
| Interest income | |||||||||||
| Interest and fee income on loans | $ | 2,591,015 | $ | 2,536,482 | $ | 4,904,212 | $ | 5,184,945 | |||
| Interest on federal funds sold and FRB deposits | 121,723 | 23,835 | 174,910 | 40,100 | |||||||
| Interest on time deposits in banks | – | – | – | – | |||||||
| Interest on investment securities | 842,810 | 218,100 | 1,192,224 | 431,543 | |||||||
| Total interest income | 3,555,548 | 2,778,417 | 6,271,346 | 5,656,588 | |||||||
| Interest Expense | |||||||||||
| Interest on deposits | 48,804 | 48,752 | 91,321 | 98,546 | |||||||
| Other borrowings | 212,719 | 155,818 | 419,222 | 277,882 | |||||||
| Total interest expense | 261,523 | 204,570 | 510,543 | 376,428 | |||||||
| Net interest income | 3,294,025 | 2,573,847 | 5,760,803 | 5,280,160 | |||||||
| Provision for loan losses | 250,000 | 170,000 | 50,000 | 370,000 | |||||||
| Net interest income after provision for loan losses | 3,044,025 | 2,403,847 | 5,710,803 | 4,910,160 | |||||||
| Non-interest income | |||||||||||
| Service charges on deposit accounts | 444,237 | 391,238 | 853,482 | 739,336 | |||||||
| Other miscellaneous income | 71,781 | 80,061 | 130,469 | 141,777 | |||||||
| Dividend income from restricted stock | 33,460 | 23,917 | 61,686 | 47,025 | |||||||
| Income from bank-owned life insurance | 45,018 | 31,162 | 89,151 | 61,726 | |||||||
| Total non-interest income | 594,496 | 526,378 | 1,134,788 | 989,864 | |||||||
| Non-interest expenses | |||||||||||
| Salaries and employee benefits | 1,191,030 | 1,032,909 | 2,435,342 | 2,081,133 | |||||||
| Occupancy and equipment | 152,959 | 151,628 | 312,722 | 307,914 | |||||||
| Data and item processing | 190,698 | 164,107 | 372,179 | 320,655 | |||||||
| Advertising and marketing | 25,704 | 27,236 | 75,521 | 54,420 | |||||||
| Legal and professional fees | 43,770 | 46,167 | 87,795 | 90,432 | |||||||
| Regulatory assessments | 46,430 | 36,561 | 89,098 | 70,041 | |||||||
| Insurance | 10,124 | 10,106 | 20,053 | 19,929 | |||||||
| Directors’ fees and expenses | 32,040 | 32,880 | 64,200 | 65,160 | |||||||
| Other expenses | 219,000 | 219,444 | 409,791 | 514,181 | |||||||
| Total non-interest expenses | 1,911,755 | 1,721,038 | 3,866,701 | 3,523,865 | |||||||
| Income before income tax expense | 1,726,766 | 1,209,187 | 2,978,890 | 2,376,159 | |||||||
| Income tax expense | 491,913 | 341,717 | 843,824 | 670,277 | |||||||
| Net income | $ | 1,234,853 | $ | 867,470 | $ | 2,135,066 | $ | 1,705,882 | |||
| Basic earnings per share | $ | 0.46 | $ | 0.32 | $ | 0.80 | $ | 0.64 | |||
| Diluted earnings per share | $ | 0.46 | $ | 0.32 | $ | 0.80 | $ | 0.64 | |||
| For the three months ended | For the six months ended | ||||||||||||||
| June 30 | June 30 | ||||||||||||||
| 2022 | 2021 | 2022 | 2021 | ||||||||||||
| KEY FINANCIAL RATIOS | |||||||||||||||
| (unaudited) | |||||||||||||||
| Annualized return on average equity | 17.68 | % | 13.00 | % | 15.00 | % | 12.69 | % | |||||||
| Annualized return on average assets | 1.22 | % | 0.99 | % | 1.07 | % | 1.01 | % | |||||||
| Net interest margin | 3.43 | % | 3.17 | % | 3.09 | % | 3.37 | % | |||||||
| Core efficiency ratio | 49.16 | % | 55.51 | % | 56.07 | % | 56.20 | % | |||||||
| Net chargeoffs/(recoveries) to average loans | -0.011 | % | -0.008 | % | -0.02 | % | -0.02 | % | |||||||
| AVERAGE BALANCES | |||||||||||||||
| (thousands, unaudited) | |||||||||||||||
| Average assets | $ | 405,447 | $ | 350,226 | $ | 397,719 | $ | 338,983 | |||||||
| Average interest-earning assets | $ | 385,416 | $ | 325,987 | $ | 376,406 | $ | 315,817 | |||||||
| Average gross loans | $ | 175,736 | $ | 196,470 | $ | 175,021 | $ | 196,228 | |||||||
| Average deposits | $ | 355,910 | $ | 303,611 | $ | 348,217 | $ | 291,780 | |||||||
| Average equity | $ | 27,942 | $ | 26,684 | $ | 28,466 | $ | 26,886 | |||||||
| CREDIT QUALITY | End of period | ||||||||||||||
| (unaudited) | June 30, 2022 | December 31, 2021 | |||||||||||||
| Non-performing loans | $ | 453,427 | $ | 115,434 | |||||||||||
| Non-performing loans to total loans | 0.26 | % | 0.07 | % | |||||||||||
| Non-performing loans to total assets | 0.11 | % | 0.03 | % | |||||||||||
| Allowance for loan losses to total loans | 2.30 | % | 2.21 | % | |||||||||||
| Nonperforming assets as a percentage of total loans and OREO | 0.26 | % | 0.07 | % | |||||||||||
| Allowance for loan losses to non-performing loans | 875.55 | % | 3368.57 | % | |||||||||||
| OTHER PERIOD-END STATISTICS | |||||||||||||||
| (unaudited) | |||||||||||||||
| Shareholders equity to total assets | 7.36 | % | 7.82 | % | |||||||||||
| Net loans to deposits | 48.38 | % | 53.59 | % | |||||||||||
| Non-interest bearing deposits to total deposits | 61.88 | % | 61.24 | % | |||||||||||
| Total capital to total risk-weighted assets | 22.74 | % | 18.30 | % | |||||||||||
| Tier 1 capital to total risk-weighted assets | 26.12 | % | 20.16 | % | |||||||||||
| Company Leverage Ratio | 8.16 | % | 8.84 | % | |||||||||||
