Chino Commercial Bancorp Reports 6% Increase In Net Earnings


CHINO, Calif., April 19, 2024 (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 first quarter ended March 31, 2024.

Net earnings for the first quarter of 2024, were $1.24 million, which represents an increase of $75.2 thousand or 6.4% in comparison with the same quarter last year. Net earnings per basic and diluted share were $0.39 for the first quarter of 2024 and $0.36 for the same quarter in 2023, respectively.

Dann H. Bowman, President and Chief Executive Officer, stated, “We are very pleased with the Bank’s performance in Q1’24. Loan quality remains very strong, with the Bank having only one delinquent loan at quarter-end, and no pending foreclosures, or OREO. Despite rising costs of doing business, so far, our small business customers have been able to adjust, and in several cases we have even seen improved financial performance. At this time the Bank has adequate capital and liquidity to continue to lend to its customers, and is expanding lending in the Inland Empire.

In 2023 the Bank became a member of the Card Brand Association and began to directly process Merchant Services for its customers. Not only does this service introduce an additional non-interest source of revenue, but the Bank has also been able to provide significant savings and transparency to a number of our small business customers. Since the Pandemic of 2020, efficient and cost effective processing of electronic payments has become a very important part of managing cash flow and business operations. In the future we can envision expanding this service outside of our immediate market; and the revenue from this service becoming an increasingly important part of the Bank’s business model.

In March, the Bank received preliminary approval from the OCC to open a new branch office in Corona. During March the Bank also completed the purchase of a commercial office building, at 1035 Montecito Avenue, Corona, CA, which will serve as the new Corona branch office. The Corona branch will be the Bank’s fifth location, and is expected to open in 4Q’24.”

Financial Condition

At March 31, 2024, total assets were $461.5 million, an increase of $15.1 million or 3.38% over $446.4 million at December 31, 2023. Total deposits increased by $15.4 million or 4.8% to $335.2 million as of March 31, 2024, compared to $319.8 million as of December 31, 2023. At March 31, 2024, the Company’s core deposits represent 98.08% of the total deposits.

Gross loans increased by $1.5 million or 1.0% to $180.5 million as of March 31, 2024, compared to $179.0 million as of December 31, 2023. The Bank had three non-performing loans for the quarter ended March 31, 2024, and as of December 31, 2023.   OREO properties remained at zero as of March 31, 2024 and December 31, 2023 respectively.  

Earnings

The Company posted net interest income of $3.3 million for the three months ended March 31, 2024 and $3.2 million or the same quarter last year, respectively. Average interest-earning assets were $469.3 million with average interest-bearing liabilities of $276.9 million, yielding a net interest margin of 2.87% for the first quarter of 2024, as compared to the average interest-earning assets of $380.3 million with average interest-bearing liabilities of $168.7 million, yielding a net interest margin of 3.39% for the first quarter of 2023.

Non-interest income totaled $773.5 thousand for the first quarter of 2024, or an increase of 30.05% as compared with $594.8 thousand earned during the same quarter last year. The majority of the increase is attributed to the Company’s merchant services processing revenue that reached $132.8 thousand, representing an increase of $91.8 thousand during the first quarter as compared to $41.0 thousand for the same period last year.

General and administrative expenses were $2.4 million for the three months ended March 31, 2024, and $2.1 million for the same period last year. The largest component of general and administrative expenses was salary and benefits expense of $1.5 million for the first quarter of 2023 and $1.4 million for the same period last year.

Income tax expense was $490 thousand, which represents an increase of $25 thousand or 5.47% for the three months ended March 31, 2024, as compared to $464 thousand for the same quarter last year. The effective income tax rate for the first quarter of 2024 was approximately 28.2%, and 28.4% 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.

Chino Commercial Bankcorp and Subsidiary
Consolidated Statements of Financial Condition
 
     As of
     3/31/2024 12/31/2023
     unaudited audited
Assets      
 Cash and due from banks$44,803,814  $35,503,719 
  Cash and cash equivalents 44,803,814   35,503,719 
        
 Fed funds sold  30,175   25,218 
      30,175   25,218 
        
 Investment securities available for sale , net of zero allowance for credit losses 6,615,525   6,736,976 
 Investment securities held to maturity , net of zero allowance for credit losses 210,812,408   208,506,305 
   Total investments 217,427,933   215,243,282 
 Loans held for investment, net of allowance for credit losses of   
  $4,443,654 in 2023, and $4,465,622 in 2023 175,570,771   174,352,293 
 Stock investments, restricted, at cost 3,126,100   3,126,100 
 Fixed assets, net 7,225,018   5,466,358 
 Accrued interest receivable 1,596,955   1,439,178 
 Bank owned life insurance 8,303,469   8,247,174 
 Other assets  3,398,462   3,010,916 
        
    Total assets$461,482,698  $446,414,237 
        
Liabilities      
 Deposits     
 Noninterest-bearing 175,979,729   167,131,411 
 Interest-bearing  159,203,159   152,669,374 
        
    Total deposits 335,182,888   319,800,785 
        
 Federal Home Loan Bank advances 8,000,000   15,000,000 
 Federal Reserve Bank borrowings 64,000,000   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 722,181   2,156,153 
 Other liabilities  1,789,798   1,876,474 
        
    Total liabilities 422,787,867   408,926,412 
        
        
        
Shareholders' Equity   
 Common stock, no par value, 10,000,000 shares authorized   
  and 3,211,970 shares issued and outstanding   
  at March 31, 2024 and December 31, 2023 10,502,558   10,502,557 
 Retained earnings 30,164,405   28,920,732 
 Accumulated other comprehensive loss - unrecognized   
  loss on available for sale, net of taxes (1,972,133)  (1,935,464)
        
    Total shareholders' equity 38,694,830   37,487,824 
        
    Total liabilities and shareholders' equity$461,482,698  $446,414,237 
        


Chino Commercial Bankcorp and Subsidiary
Consolidated Statements of Net Income
 
   For the three month ended
   31-Mar
    2024   2023 
   (unaudited) (unaudited)
Interest income    
 Interest and fees on loans 2,727,801   2,390,159 
 Interest on investment securities 1,936,105   1,133,586 
 Other interest income 1,030,948   405,234 
      
  Total interest income 5,694,854   3,928,979 
      
Interest expense    
 Interest on deposits 1,032,935   376,861 
 Interest on borrowings 1,312,693   371,403 
      
  Total interest expense 2,345,628   748,264 
      
Net interest income  3,349,226   3,180,716 
      
Provision for loan losses (2,933)  2,136 
      
Net interest income after provision for loan losses 3,352,159   3,178,580 
      
Noninterest income    
 Service charges and fees on deposit accounts 439,857   359,899 
 Interchange fees 92,271   103,159 
 Earnings from bank-owned life insurance 56,295   46,311 
 Merchant services processing 132,768   40,955 
 Other miscellaneous income 52,272   44,439 
      
  Total noninterest income 773,464   594,763 
      
Noninterest expense    
 Salaries and employee benefits 1,501,427   1,352,935 
 Occupancy and equipment 160,581   153,591 
 Merchant services processing 71,209   10,671 
 Other expenses 659,466   623,795 
      
  Total noninterest expense 2,392,683   2,140,992 
      
Income before income tax expense 1,732,939   1,632,350 
Provision for income taxes 489,266   463,901 
      
Net income $1,243,673  $1,168,449 
      
Basic earnings per share$0.39  $0.36 
      
Diluted earnings per share$0.39  $0.36 
      


Chino Commercial Bankcorp and Subsidiary
Financial Highlights
 
 For the three month ended
 31-Mar
Key Financial Ratios2024 2023
(unaudited)   
Annualized return on average equity13.07% 14.26%
Annualized return on average assets1.01% 1.16%
Net interest margin2.87% 3.39%
Core efficiency ratio58.04% 56.71%
Net chargeoffs/(recoveries) to average loans-0.010% -0.008%
    
Average Balances   
(thousands, unaudited)   
Average assets494,406  401,948 
Average interest-earning assets469,307  380,256 
Average interest-bearing liabilities276,918  168,672 
Average gross loans182,133  181,162 
Average deposits318,818  328,448 
Average equity38,073  32,770 
    
 End of period
 3/31/2024 12/31/2023
Credit Quality   
Non-performing loans475,062  492,242 
Non-performing loans to total loans0.26% 0.27%
Non-performing loans to total assets0.10% 0.11%
Allowance for credit losses to total loans2.46% 2.49%
Nonperforming assets as a percentage of total loans and OREO0.26% 0.27%
Allowance for credit losses to non-performing loans935.38% 905.82%
    
Other Period-end Statistics   
Shareholders equity to total assets8.38% 8.40%
Net loans to deposits52.38% 54.52%
Non-interest bearing deposits to total deposits52.50% 52.26%
Company leverage ratio8.85% 9.26%
    

 

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