Chino Commercial Bancorp : Audited Financial Statements

Consolidated Financial Statements

December 31, 2021 and 2020

Chino Commercial Bancorp and Subsidiary

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Chino Commercial Bancorp and Subsidiary
	Table of Contents
	December 31, 2021 and 2020
Independent Auditor's Report ...................................................................................................................................	1
Consolidated Financial Statements
Consolidated Statements of Financial Condition...................................................................................................	3
Consolidated Statements of Net Income...............................................................................................................	4
Consolidated Statements of Comprehensive Income ...........................................................................................	5
Consolidated Statement of Changes in Shareholders' Equity ...............................................................................	6
Consolidated Statements of Cash Flows................................................................................................................	7
Notes to Consolidated Financial Statements.........................................................................................................	8

Independent Auditor's Report

To the Board of Directors

Chino Commercial Bancorp and Subsidiary

Chino, California

Report on the Audit of the Consolidated Financial Statements

Opinion

We have audited the consolidated financial statements of Chino Commercial Bancorp and Subsidiary, which comprise the consolidated statements of financial condition as of December 31, 2021 and 2020, and the related consolidated statements of net income, comprehensive income, changes in shareholders' equity, and cash flows for the years then ended, and the related notes to the consolidated financial statements.

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the financial position of Chino Commercial Bancorp and Subsidiary as of December 31, 2021 and 2020, and the results of their operations and their cash flows for years then ended, in accordance with accounting principles generally accepted in the United States of America.

Basis for Opinion

We conducted our audits in accordance with auditing standards generally accepted in the United States of America (GAAS). Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are required to be independent of Chino Commercial Bancorp and Subsidiary, and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audits. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Responsibilities of Management for the Consolidated Financial Statements

Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with accounting principles generally accepted in the United States of America; and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

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In preparing the consolidated financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about Chino Commercial Bancorp and Subsidiary's ability to continue as a going concern for one year after the date that the consolidated financial statements are available to be issued.

Auditor's Responsibilities for the Audit of the Consolidated Financial Statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with GAAS will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the consolidated financial statements.

In performing an audit in accordance with GAAS, we:

• Exercise professional judgment and maintain professional skepticism throughout the audit.
• Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of Chino Commercial Bancorp and Subsidiary's internal control. Accordingly, no such opinion is expressed.
• Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the consolidated financial statements.
• Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about Chino Commercial Bancorp and Subsidiary's ability to continue as a going concern for a reasonable period of time.

We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control-related matters that we identified during the audit.

Laguna Hills, California

February 23, 2022

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Chino Commercial Bancorp and Subsidiary

Consolidated Statements of Financial Condition

December 31, 2021 and 2020

	2021			2020
Assets
Cash and due from banks	$ 135,593,445	$	58,075,217
Cash and cash equivalents	135,593,445			58,075,217
Investment securities available for sale (note 2)	40,270,538			32,370,042
Investment securities held to maturity (note 2)	12,435,291			18,626,525
Loans held for investment, net of allowance for loan losses of
$3,888,480 in 2021, and $3,271,921 in 2020, (note 4)	170,876,382			190,714,242
Stock investments, restricted, at cost (note 3)	2,045,200			1,554,200
Fixed assets, net (note 5)	5,897,342			6,145,711
Accrued interest receivable	877,104			1,013,732
Bank owned life insurance	7,871,339			4,721,232
Other assets	2,647,812			1,618,717
Total assets	$ 378,514,453	$	314,839,618
Liabilities
Deposits (note 7)
Noninterest-bearing	$ 195,274,304	$	145,433,815
Interest-bearing	123,604,881			112,277,985
Total deposits	318,879,185			257,711,800
Federal Home Loan Bank advances (note 8)	15,000,000			25,000,000
Subordinated debt (note 8)	10,000,000			-
Subordinated notes payable to subsidiary trust (note 9)	3,093,000			3,093,000
Accrued interest payable	130,327			137,487
Other liabilities	1,817,705			1,674,150
Total liabilities	348,920,217			287,616,437
Commitments and Contingent Liabilities (notes 13 and 14)	-			-
Shareholders' Equity
Common stock, no par value, 10,000,000 shares authorized
and 2,676,799 shares issued and outstanding
at December 31, 2021 and December 31, 2020	10,502,557			10,502,557
Retained earnings	19,556,872			16,428,258
Accumulated other comprehensive (loss) income - unrecognized
(loss) gain on available for sale, net of taxes of $(182,258) in
2021 and $114,545 in 2020	(465,193)			292,366
Total shareholders' equity	29,594,236			27,223,181
Total liabilities and shareholders' equity	$ 378,514,453	$	314,839,618

See Notes to Consolidated Financial Statements

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