CBB Bancorp : 2021 Audited Annual Report

2021

FINANCIAL STATEMENTS

December 31, 2021 and 2020

Dear Valued Shareholders and Customers,

We have much to be proud of as we look at the performance of CBB Bancorp Inc. and its wholly owned subsidiary, Commonwealth Business Bank (collectively the "Bank", or "CBB"), as well as a clearly defined strategy for reaching CBB's near- and long-terms goals of continued profitable growth and improved net income.

Turning to CBB's financial results for the year ended December 31, 2021, we reported net income of $27.5 million, or $2.65 per diluted share, nearly triple the net income of $9.9 million, or $0.96 per diluted share, a year ago. Even more impressive, this performance reflected four consecutive quarters of record earnings.

As we had expected, our acquisition of Ohana Pacific Bank, which we closed on July 1, 2021, has proven to be a success. The contribution of Ohana Pacific in the second half of the year, together with our actions to aggressively lower deposit rates, positively contributed to CBB's net interest income growth rate of 37.4% for a total of $58.8 million for the year. Ohana Pacific also contributed to our growth in deposits, to $1.6 billion at year end 2021, up from $1.1B last year. We believe that Ohana Pacific will be a key part of our long-term growth strategy and will continue to prove to be a valuable addition to our enterprise.

Noninterest income for 2021 was $19.6 million, up from $9.6 million in 2020. The largest contributor to noninterest income was gains on sales of SBA loans. The origination of quality SBA loans continues as a core business line for the Bank, and is an ongoing focus for management's efforts and future investment.

We are pleased to have been able to maintain CBB's excellent asset quality during 2021. For the year ended December 31, 2021, we reported a negative provision for loan losses of $0.3 million. This compared with a $5.5 million positive loan loss provision for the corresponding period in 2020. Our focus on continuous monitoring and improvement, and the favorable macro-economic environment that continued through 2021, drove improved asset quality ratios and a reduction in charge offs that contributed to the favorable result.

Shareholders' equity was $185.2 million at December 31, 2021, and represented an increase of 3.9%, to $6.9 million, compared with shareholders' equity of $160.0 million, at December 30, 2020. Tangible book value per share on December 31, 2021 was $17.76, compared with $15.61 at December 31, 2020, an increase of $2.51 per share, or 13.8%.

All of CBB's regulatory capital ratios improved as of December 31, 2021 and continued to exceed the regulatory minimum levels required to be considered Well Capitalized. Our Common Equity Tier 1 risked-based capital ratio at December 31, 2021 was 13.8% at the Company level, and 13.8% at the Bank level. For 2021, the cost of funds was 0.38%, compared to 1.04% in 2020.

We are pleased to report that in May of 2021, the Board of Directors instituted a quarterly cash dividend. Three dividend payments were made during the year, with the initial dividend of $.050 per share increasing to $.077 per share by the fourth quarter, with the most recent dividend declared after year end for shareholders of record as of February 11, 2022. While business circumstances will dictate the future of declaring such dividends, the Board of Directors of CBB Bancorp believes returning cash to shareholders in the form of dividends was a key component of the company's cash allocation strategy in 2021, and the Board will consider a number of factors to determine its appropriateness on a quarterly basis.

The Company's basic principles and strategies that drive our growth - maintaining a robust balance sheet, continuously improving our risk and governance profile, fully satisfying regulators, seeking out opportunistic acquisitions in support of specific goals, continuing to drive good organic growth, recognizing and rewarding employee talent, and serving customers and clients with superior service and offerings - all power the future prospects of our Bank and position it to grow and prosper in the decades to come.

Our long-standing mission is to build a Bank that can serve generations to come and be recognized as a leader among Korean-American banks. This mission requires an unwavering commitment to our core values to provide each and every one of our customers with an experience that imparts professional knowledge and expertise, provides a personal touch and customized service with every action, and is underscored by principled and ethical intent and passionate enthusiasm.

Near term, we will focus on fully integrating Ohana Pacific into CBB's operations, while continuously focusing on lowering costs, ensuring stable funding that will enable us to continue to make strong loans, growing our SBA business, and expanding our mortgage lending operations on the mainland. We will continue to pursue these and other value-creating opportunities as we remain uniquely qualified to serve our local businesses and communities with the goal of growing profitably and maximizing value for our shareholder's long term.

On behalf of the entire Board of Directors, we truly value our shareholders' trust, input and support. We also thank our entire CBB Bancorp team for their dedication and commitment to our customers and our shareholders.

Soon Han Pak James C. Hong

Chairwoman of the Board President & Chief Executive Officer

April 21, 2022

CBB BANCORP, INC. Los Angeles, California

FINANCIAL STATEMENTS December 31, 2021 and 2020

CONTENTS

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM ........................................ 1

CONSOLIDATED FINANCIAL STATEMENTS

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION ....................................................... 4

CONSOLIDATED STATEMENTS OF INCOME ................................................................................ 5

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME ................................................ 6

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY ......................... 7

CONSOLIDATED STATEMENTS OF CASH FLOWS ....................................................................... 8

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS .............................................................. 9