Chino Commercial Bancorp Reports 6% Increase In Net Earnings
April 19, 2024 at 01:09 pm EDT
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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 Ratios
2024
2023
(unaudited)
Annualized return on average equity
13.07
%
14.26
%
Annualized return on average assets
1.01
%
1.16
%
Net interest margin
2.87
%
3.39
%
Core efficiency ratio
58.04
%
56.71
%
Net chargeoffs/(recoveries) to average loans
-0.010
%
-0.008
%
Average Balances
(thousands, unaudited)
Average assets
494,406
401,948
Average interest-earning assets
469,307
380,256
Average interest-bearing liabilities
276,918
168,672
Average gross loans
182,133
181,162
Average deposits
318,818
328,448
Average equity
38,073
32,770
End of period
3/31/2024
12/31/2023
Credit Quality
Non-performing loans
475,062
492,242
Non-performing loans to total loans
0.26
%
0.27
%
Non-performing loans to total assets
0.10
%
0.11
%
Allowance for credit losses to total loans
2.46
%
2.49
%
Nonperforming assets as a percentage of total loans and OREO
0.26
%
0.27
%
Allowance for credit losses to non-performing loans
935.38
%
905.82
%
Other Period-end Statistics
Shareholders equity to total assets
8.38
%
8.40
%
Net loans to deposits
52.38
%
54.52
%
Non-interest bearing deposits to total deposits
52.50
%
52.26
%
Company leverage ratio
8.85
%
9.26
%
Contact: Dann H. Bowman, President and CEO or Melinda M. Milincu, Senior 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 serves as the holding company for Chino Commercial Bank (The Bank), which is a nationally chartered bank. The Bank offers personal banking and business banking services. The Bank's personal banking services, such as personal checking and savings, individual retirement account, online banking, mobile banking, Cash on delivery, debit cards, direct deposit, e-statements, electronic tax payment services, night depository, notary services and savings bonds. Its business banking offers business checking and savings, business loans, online cash management, business mobile banking, remote deposit capture, merchant services and medical professionals. Its Commercial loan products include lines of credit, letters of credit, term loans and equipment loans, commercial real estate loans, accounts receivable financing, factoring, equipment leasing and other working capital financing. Its Financing products include home improvement lines of credit and MasterCard debit cards.