Chino Commercial Bancorp Reports 9.5% Increase In Net Earnings
CHINO, Calif., Jan. 20, 2017 (GLOBE NEWSWIRE) -- The Board of Directors of Chino Commercial Bank, N.A. (OTC:CCBC) announced the results of operations for the year ended December 31, 2016 with net income of $1,453,103, or an increase of 9.5% over net income of $1,327,370 for December 31, 2015. Net income per basic and diluted share for the year ended December 31, 2016 was $1.18 as compared to $1.08 per share for the year ended December 31, 2015.
Net income for the fourth quarter ended December 31, 2016 was $329,476, or an increase of 3.4%, as compared with net income of $318,620 for the same quarter last year. Net income per basic and diluted share for the fourth quarter of 2016 was $0.27 as compared to $0.26 for the same quarter last year.
Dann H. Bowman, President and Chief Executive Officer stated, “We are very pleased with the performance of the Bank in 2016. This year the Bank set new records for total deposits, loans and earnings. The Company’s net earnings for fiscal year 2016 were up over 9.4%, representing a return on beginning equity of 12%. Deposit and Loan balances increased during the year by 5.5% and 17.5% respectively, allowing the Bank to show improved stability of earnings and efficiency.”
Financial Condition
At December 31, 2016, total assets were $175.1 million, an increase of $13.7 million or 8.5% over $161.4 million at December 31, 2015. Total deposits increased by 5.5% or $7.2 million during the year to $137.6 million, compared to $130.3 million as of December 31, 2015. At December 31, 2016, the Company’s core deposits represent 96.8% of the total deposits.
Gross loans increased by 17.5% or $16.3 million as of December 31, 2016 to $109.5 million as compared with $93.2 million as of December 31, 2015. The Bank had one nonperforming loan at the end of the fourth qurter and no nonperforming loans as of December 31, 2015. OREO properties remained at zero as of December 31, 2016, and December 31, 2015, respectively.
Earnings
The Company posted net interest income of $1,478,873 and $1,355,351 for the three months ended December 31, 2016 and 2015, respectively, or an increase of $123,522 or 9.1%. Average interest-earning assets were $161.8 million with average interest-bearing liabilities of $85.9 million, yielding a net interest margin of 3.64% for the fourth quarter of 2016, as compared to the average interest-earning assets of $150.7 million with average interest-bearing liabilities of $75.4 million, yielding a net interest margin of 3.57% for the fourth quarter of 2015.
Non-interest income totaled $383,362 for the fourth quarter of 2016, or an increase of 2.2% as compared with $375,022 earned during the same quarter last year. Service charges on deposit accounts decreased 12.5% to $241,256 primarily due to a decrease in income from returned items and overdraft charges. Dividend income from restricted stock increased to $99,694 for the fourth quarter of 2016, compared to $51,951 for the same quarter in 2015. Income from bank-owned life insurance remained consistent at $25,891 in the fourth quarter of 2016 and $25,875 in the fourth quarter of 2015.
General and administrative expenses were $1,283,729 for the three months ended December 31, 2016, as compared to $1,176,051 for the fourth quarter of 2015. The largest component of general and administrative expenses was salary and benefits expense of $791,133 for the fourth quarter of 2016, as compared to $690,496 for the same quarter last year. Regulatory assessments increased to $37,611 in the fourth quarter of 2016 in comparison with $33,767 in the fourth quarter of 2015. Advertising and marketing expenses increased 37.5% to $22,598 in the fourth quarter of 2016 from $16,438 for the same period last year.
Income tax expense was $209,030 for the three months ended December 31, 2016 as compared to $197,455 for the three months ended December 31, 2015. The effective income tax rate for the fourth quarter of 2016 and 2015 is approximately 38.8% and 38.3%, 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 there from, changes in interest rates, loan portfolio performance, and other factors.
Contact: Dann H. Bowman, President and CEO or Melinda M. Milincu, 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 | ||||||||
| CONSOLIDATED BALANCE SHEET | ||||||||
| December 31, 2016 and December 31, 2015 | ||||||||
| December 31, 2016 | December 31, 2015 | |||||||
| (unaudited) | (audited) | |||||||
| ASSETS: | ||||||||
| Cash and due from banks | 30,498,888 | $ | 24,898,140 | |||||
| Total cash and cash equivalents | 30,498,888 | 24,898,140 | ||||||
| Interest-bearing deposits in other banks | 2,480,000 | 4,960,000 | ||||||
| Investment securities available for sale | 3,924,102 | 4,931,068 | ||||||
| Investment securities held to maturity (fair value approximates | ||||||||
| $18,240,000 at December 31, 2016 and $23,115,000 at December 31, 2015) | 18,407,741 | 23,100,106 | ||||||
| Total investments | 24,811,843 | 32,991,174 | ||||||
| Loans | ||||||||
| Real estate | 87,306,627 | 72,756,410 | ||||||
| Commercial | 21,822,341 | 20,053,905 | ||||||
| Installment | 424,818 | 433,764 | ||||||
| Gross loans | 109,553,786 | 93,244,079 | ||||||
| Unearned fees and discounts | (348,359 | ) | (251,911 | ) | ||||
| Loans net of unearned fees and discount | 109,205,427 | 92,992,168 | ||||||
| Allowance for loan losses | (1,845,447 | ) | (1,667,204 | ) | ||||
| Net loans | 107,359,980 | 91,324,964 | ||||||
| Fixed assets, net | 6,000,404 | 6,021,446 | ||||||
| Accrued interest receivable | 295,102 | 395,685 | ||||||
| Stock investments, restricted, at cost | 1,935,300 | 1,766,500 | ||||||
| Bank-owned life insurance | 3,285,963 | 3,183,247 | ||||||
| Other assets | 904,338 | 803,048 | ||||||
| Total assets | $ | 175,091,818 | $ | 161,384,204 | ||||
| LIABILITIES: | ||||||||
| Deposits | ||||||||
| Non-interest bearing | $ | 68,613,998 | $ | 74,431,378 | ||||
| Interest bearing | ||||||||
| NOW and money market | 52,873,006 | 40,980,418 | ||||||
| Savings | 5,165,730 | 4,815,198 | ||||||
| Time deposits less than $250,000 | 6,471,260 | 3,913,644 | ||||||
| Time deposits of $250,000 or greater | 4,438,254 | 6,208,083 | ||||||
| Total deposits | 137,562,248 | 130,348,721 | ||||||
| Accrued interest payable | 27,902 | 25,229 | ||||||
| Borrowings from Federal Home Loan Bank (FHLB) | 20,000,000 | 15,000,000 | ||||||
| Accrued expenses & other payables | 872,374 | 843,691 | ||||||
| Subordinated notes payable to subsidiary trust | 3,093,000 | 3,093,000 | ||||||
| Total liabilities | 161,555,524 | 149,310,641 | ||||||
| SHAREHOLDERS' EQUITY | ||||||||
| Common stock, authorized 10,000,000 shares with no par value, issued and outstanding 1,231,332 shares at December 31, 2016 and December 31, 2015, respectively. | 6,089,466 | 6,089,466 | ||||||
| Retained earnings | 7,449,608 | 6,000,577 | ||||||
| Accumulated other comprehensive income/(loss) | (2,780 | ) | (16,480 | ) | ||||
| Total shareholders' equity | 13,536,294 | 12,073,563 | ||||||
| Total liabilities & shareholders' equity | $ | 175,091,818 | $ | 161,384,204 | ||||
| CHINO COMMERCIAL BANCORP | ||||||||||||||||
| CONSOLIDATED STATEMENTS OF NET INCOME | ||||||||||||||||
| (unaudited) | ||||||||||||||||
| For the three months ended | For the year ended | |||||||||||||||
| December 31 | December 31 | |||||||||||||||
| 2016 | 2015 | 2016 | 2015 | |||||||||||||
| Interest income | ||||||||||||||||
| Interest and fee income on loans | $ | 1,418,399 | $ | 1,262,845 | $ | 5,465,664 | $ | 4,879,254 | ||||||||
| Interest on federal funds sold and FRB deposits | 40,677 | 20,931 | 129,893 | 48,306 | ||||||||||||
| Interest on time deposits in banks | 7,945 | 13,056 | 38,596 | 81,249 | ||||||||||||
| Interest on investment securities | 121,584 | 142,525 | 545,090 | 445,896 | ||||||||||||
| Total interest income | 1,588,605 | 1,439,357 | 6,179,243 | 5,454,705 | ||||||||||||
| Interest Expense | ||||||||||||||||
| Interest on deposits | 73,516 | 59,969 | 268,336 | 232,831 | ||||||||||||
| Other borrowings | 36,216 | 24,037 | 142,675 | 83,065 | ||||||||||||
| Total interest expense | 109,732 | 84,006 | 411,011 | 315,896 | ||||||||||||
| Net interest income | 1,478,873 | 1,355,351 | 5,768,232 | 5,138,809 | ||||||||||||
| Provision for loan losses | 40,000 | 38,247 | 202,410 | 42,288 | ||||||||||||
| Net interest income after provision for loan losses | 1,438,873 | 1,317,104 | 5,565,822 | 5,096,521 | ||||||||||||
| Non-interest income | ||||||||||||||||
| Service charges on deposit accounts | 241,256 | 275,640 | 1,088,993 | 1,148,730 | ||||||||||||
| Other miscellaneous income | 16,521 | 21,556 | 154,167 | 81,434 | ||||||||||||
| Dividend income from restricted stock | 99,694 | 51,951 | 221,499 | 151,381 | ||||||||||||
| Income from bank-owned life insurance | 25,891 | 25,875 | 102,716 | 102,453 | ||||||||||||
| Total non-interest income | 383,362 | 375,022 | 1,567,375 | 1,483,998 | ||||||||||||
| Non-interest expenses | ||||||||||||||||
| Salaries and employee benefits | 791,133 | 690,496 | 2,882,535 | 2,655,057 | ||||||||||||
| Occupancy and equipment | 102,348 | 114,130 | 416,781 | 424,715 | ||||||||||||
| Data and item processing | 106,385 | 99,441 | 391,691 | 386,793 | ||||||||||||
| Advertising and marketing | 22,598 | 16,438 | 76,074 | 56,437 | ||||||||||||
| Legal and professional fees | 46,227 | 42,934 | 184,900 | 158,540 | ||||||||||||
| Regulatory assessments | 37,611 | 33,767 | 141,000 | 126,580 | ||||||||||||
| Insurance | 8,608 | 8,471 | 34,180 | 33,278 | ||||||||||||
| Directors' fees and expenses | 26,983 | 26,460 | 108,013 | 107,310 | ||||||||||||
| Other expenses | 141,836 | 143,914 | 516,982 | 479,978 | ||||||||||||
| Total non-interest expenses | 1,283,729 | 1,176,051 | 4,752,156 | 4,428,688 | ||||||||||||
| Income before income tax expense | 538,506 | 516,075 | 2,381,041 | 2,151,831 | ||||||||||||
| Income tax expense | 209,030 | 197,455 | 927,938 | 824,461 | ||||||||||||
| Net income | $ | 329,476 | $ | 318,620 | $ | 1,453,103 | $ | 1,327,370 | ||||||||
| Basic earnings per share | $ | 0.27 | $ | 0.26 | $ | 1.18 | $ | 1.08 | ||||||||
| Diluted earnings per share | $ | 0.27 | $ | 0.26 | $ | 1.18 | $ | 1.08 | ||||||||
| Tax rate | 38.8 | % | 38.3 | % | 39.0 | % | 38.3 | % | ||||||||
| For the three months ended | For the year ended | ||||||||||||||||
| December 31 | December 31 | ||||||||||||||||
| 2016 | 2015 | 2016 | 2015 | ||||||||||||||
| KEY FINANCIAL RATIOS | |||||||||||||||||
| (unaudited) | |||||||||||||||||
| Annualized return on average equity | 10.62 | % | 10.63 | % | 10.73 | % | 11.54 | % | |||||||||
| Annualized return on average assets | 0.75 | % | 0.77 | % | 0.85 | % | 0.88 | % | |||||||||
| Net interest margin | 3.64 | % | 3.57 | % | 3.70 | % | 3.77 | % | |||||||||
| Core efficiency ratio | 68.93 | % | 67.97 | % | 64.78 | % | 66.87 | % | |||||||||
| Net chargeoffs/(recoveries) to average loans | -0.01 | % | -0.01 | % | 0.02 | % | -0.10 | % | |||||||||
| AVERAGE BALANCES | |||||||||||||||||
| (thousands, unaudited) | |||||||||||||||||
| Average assets | $ | 176,301 | $ | 164,614 | $ | 170,152 | $ | 150,004 | |||||||||
| Average interest-earning assets | $ | 161,809 | $ | 150,657 | $ | 155,719 | $ | 136,231 | |||||||||
| Average gross loans | $ | 106,639 | $ | 88,730 | $ | 101,710 | $ | 87,066 | |||||||||
| Average deposits | $ | 143,072 | $ | 132,235 | $ | 136,436 | $ | 122,691 | |||||||||
| Average equity | $ | 12,414 | $ | 11,988 | $ | 13,541 | $ | 11,504 | |||||||||
| CREDIT QUALITY | End of period | ||||||||||||||||
| (unaudited) | December 31, 2016 | December 31, 2015 | |||||||||||||||
| Non-performing loans | $ | 521,696 | $ | - | |||||||||||||
| Non-performing loans to total loans | 0.48 | % | 0.00 | % | |||||||||||||
| Non-performing loans to total assets | 0.30 | % | 0.00 | % | |||||||||||||
| Allowance for loan losses to total loans | 1.68 | % | 1.79 | % | |||||||||||||
| Nonperforming assets as a percentage of total loans and OREO | 0.48 | % | 0.00 | % | |||||||||||||
| Allowance for loan losses to non-performing loans | 353.74 | % | n/a | ||||||||||||||
| OTHER PERIOD-END STATISTICS | |||||||||||||||||
| (unaudited) | |||||||||||||||||
| Shareholders equity to total assets | 7.73 | % | 7.48 | % | |||||||||||||
| Net Loans to deposits | 78.04 | % | 70.06 | % | |||||||||||||
| Non-interest bearing deposits to total deposits | 49.88 | % | 57.10 | % | |||||||||||||
| Total capital to total risk-weighted assets | 10.11 | % | 16.15 | % | |||||||||||||
| Tier 1 capital to total risk-weighted assets | 15.31 | % | 15.82 | % | |||||||||||||
| Tier 1 leverage ratio | 10.24 | % | 9.79 | % | |||||||||||||
| Common equity tier 1 | 15.31 | % | 15.82 | % | |||||||||||||
