Chino Commercial Bancorp Reports First Quarter Earnings


CHINO, Calif., April 24, 2007 (PRIME NEWSWIRE) -- The Board of Directors of Chino Commercial Bancorp (OTCBB:CCBC), the parent company of Chino Commercial Bank NA, announced the results of operations for the Bank and the consolidated holding company for the first quarter ended March 31, 2007 with net earnings of $177,784, a 30.3% reduction from $254,910 for the fourth quarter of 2006, and a 32.8% reduction from net income of $264,531 for the first quarter of last year. The reduction in net income was caused in part by a significant out of pattern provision to loan loss reserve during the first quarter of $77,174. Net income per basic share for the first quarter was $0.23 as compared to $0.31 per share for the fourth quarter ended December 31, 2006, and $0.32 for the first quarter last year.

Dann H. Bowman, President and Chief Executive Officer stated, "The Bank made a significant provision to Loan Loss Reserve during the first quarter, despite having no delinquent or non-performing loans at the quarter-end. Looking at a number of economic events occurring in and around the real estate industries, the Bank is taking a proactive and conservative approach to credit quality by making this provision. Though the provision resulted in lower earnings during the first quarter, in the long run we believe that these conservative credit practices will be a benefit the Bank ongoing.

"At quarter-end March 31, 2007 the Bank had no delinquent loans, no loans on non-accrual status, and experienced no credit losses year-to-date, and no credit losses for the past six years. The Bank has not originated, and has no exposure to sub-prime mortgage loans, or option ARM mortgages."

Net earnings for the first quarter represent a return on average equity of 10.53% and a return of average assets of 0.82%.

Financial Condition

At March 31, 2007, total assets were $92.7 million, an increase of $2.2 million or 2.5% from December 31, 2006, and an increase of $1.1 million or 1.2% from March 31, 2006.

Loans were relatively unchanged with a slight reduction during the first quarter of $165,000 from December 31, 2006 with a balance at March 31, 2007 of $51.6 million. Comparing the balances of March 31, 2006, the Company's loans increased to $7.3 million or 16.6% during the twelve month period. The growth was primarily in real estate secured lending.

Total deposits increased by 4.9% to $83.3 million at March 31, 2007, an increase from $79.5 million at December 31, 2006. Total deposits decreased 0.8% from March 31, 2006's balance of $84.0 million. The Company's core deposits represent 96.8% of the total deposits.

Earnings

The Company posted net interest income of $1,074,278 for the quarter ended March 31, 2007 as compared to $1,095,527 for the quarter ended March 31, 2006. Average interest-earning assets were $81.5 million with average interest-bearing liabilities of $29.0 million yielding a net interest margin of 5.30% for the quarter ended March 31, 2007, as compared to average interest-bearing assets of $81.1 million with average interest-bearing liabilities of $28.2 million yielding a net interest margin of 5.75% for the fourth quarter of 2006.

Non-interest income totaled $211,870 for the first quarter of 2007, or an increase of 38.5% from $152,951 earned during the year ended March 31, 2006. Service charges on deposit accounts increased 37.8% to $177,382 due to increased of overdraft and return item charges.

General and administrative expenses were $937,680 for the three months ended March 31, 2007 as compared to $803,238 for the three months ended March 31, 2006. The largest component of general and administrative expenses was salary and benefits expense of $481,853 for the first quarter of 2007 as compared to $409,178 for the three months ended March 31, 2006. The increase in Salaries and benefits expenses was reflective of salary increases, incentive compensation, and the increase in retirement plan accruals. Other components of general and administrative expenses that affected the increase were Advertising and Marketing expenses which increased by $25,077 for the comparable three month period due to a marketing campaign which the Company entered into during the first quarter. Audit and Professional fees increased $26,531 during the first quarter of 2007 due to additional costs incurred in the purchase of shares from stockholders and an increase in accruals to reflect timely recognition of audit and professional fees incurred during the first quarter. Other expenses increased by $19,423 for the comparable three month period due primarily due to increased Reserve for Undisbursed Credits of $11,281.

Income tax expense was $104,791 for the three months ended March 31, 2007 as compared to $171,959 for the three months ended March 31, 2006. The effective income tax rate for 2007 and 2006 is approximately 39%.

Forward-Looking Statements

The foregoing contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are not historical facts and include expressions about the Bank's plans, objectives, management's expectations, intentions, relationships, opportunities, and technology and market condition statements. When used in these presentations, the words "expects," "anticipates," "intends," "plans," "believes," "seeks," "estimates," or words of similar meaning, or future or conditional verbs, such as "will," "would," "should," "could," or "may" are generally intended to identify forward-looking statements. These forward-looking statements are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond the Company's control. In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change.

Actual results may differ from those projected in the forward-looking statements. These forward-looking statements involve risks and uncertainties. These include, but are not limited to, the following risks; (1) changes in performance of the financial markets; (2) changes in the demand for and market acceptance of Chino Commercial Bancorp's products and services; (3) changes in general economic conditions including interest rates, presence of competitors with greater financial resources, and the impact of competitive products and pricing; (4) the effect of the Company's policies; (5) the continued availability of adequate funding sources. The Bank is not obligated to update and does not undertake to update any of its forward-looking statements made herein.



                          CHINO COMMERCIAL BANCORP
                      STATEMENTS OF FINANCIAL CONDITION
                    March 31, 2007 and December 31, 2006

                                                2007         2006
                                             -----------  -----------
 ASSETS:                                     (unaudited)
 Cash and Due from Banks                     $ 4,367,398  $ 4,201,391
 Federal Funds Sold                           16,460,000   10,775,000
                                             -----------  -----------
  Cash and Cash equivalents                   20,827,398   14,976,391
 Interest-bearing deposits at banks            1,246,000    2,541,000
 Investment Securities available for sale     10,002,655   11,839,152
 Investment Securities held to maturity
  (fair value approximates $4,481,000 at
  March 31, 2007 and $4,696,000 at
  December 31, 2006)                           4,567,602    4,784,277
                                             -----------  -----------
    Total investments                         15,816,257   19,164,429
                                             -----------  -----------
 Loans
  Construction                                 1,378,718    1,925,067
  Real estate                                 38,017,981   37,521,967
  Commercial                                  11,377,458   11,655,290
  Installment                                    834,359      670,765
  Unearned fees and discounts                   (141,275)    (136,046)
  Allowance for loan losses                     (681,701)    (615,808)
                                             -----------  -----------
    Total Loans                               50,785,540   51,021,235
                                             -----------  -----------
 Restricted stock                                633,600      627,500
 Fixed Assets, net                             2,196,841    2,222,503
 Accrued Interest Receivable                     303,165      385,764
 Prepaid & Other Assets                        2,135,968    2,076,976
                                             -----------  -----------
    Total Assets                             $92,698,769  $90,474,798
                                             ===========  ===========
 LIABILITIES:
 Deposits
  Non-interest Bearing                       $56,268,332  $53,845,147
  Interest Bearing
   NOW and Money market                       21,631,577   19,907,277
   Savings                                       908,790    1,001,135
   Time deposits less than $100,000            1,893,123    1,818,235
   Time deposits of $100,000 or greater        2,647,015    2,882,341
                                             -----------  -----------
    Total Deposits                            83,348,837   79,454,135
                                             -----------  -----------
 Accrued Interest Payable                         65,279       61,477
 Accrued Expenses & Other Payables               438,495      412,745
 Subordinated Debentures                       3,093,000    3,093,000
                                             -----------  -----------
    Total Liabilities                         86,945,611   83,021,357
                                             -----------  -----------
 STOCKHOLDERS' EQUITY
  Common Stock, authorized 10,000,000 shares
   with no par value, issued and outstanding
   722,468 shares and 808,214 shares at
   March 31, 2007 and December 31, 2006,
   respectively                                3,122,637    5,022,984
  Retained earnings                            2,685,156    2,507,373
  Accumulated other comprehensive loss           (54,635)     (76,916)
                                             -----------  -----------
   Total Equity                                5,753,158    7,453,441
                                             -----------  -----------
    Total Liabilities & Equity               $92,698,769  $90,474,798
                                             ===========  ===========

                        CHINO COMMERCIAL BANCORP
                        STATEMENTS OF OPERATIONS
                              (unaudited)

                                                For the Quarter Ended
                                                March 31,   March 31, 
                                                  2007        2006
                                               ----------  ----------
 Interest Income
  Interest Income - Securities                 $  191,235  $  286,680
  Interest Income - Fed Funds                     116,830      77,874
  Interest and fee income on Loans                977,172     811,179
                                               ----------  ----------
    Total Interest Income                       1,285,237   1,175,733
                                               ----------  ----------
 Interest Expense

  Interest Expense - Deposits                     159,696      79,906
  Interest Expense - Other Borrowings              51,263         300
                                               ----------  ----------
    Total Interest Expense                        210,959      80,206
                                               ----------  ----------
   Net interest income                          1,074,278   1,095,527
                                               ----------  ----------
 Provision for loan losses                         65,893       8,750
                                               ----------  ----------
   Net interest income after provision for
    loan losses                                 1,008,385   1,086,777
                                               ----------  ----------
 Non-interest income

  Service Charges on Deposit Accounts             177,682     128,948
  Other miscellaneous fee income                    9,110       3,128
  Dividend Income from Restricted Stock             8,875       6,194
  Income from Bank Owned Life Insurance            16,203      14,681
                                               ----------  ----------
    Total Non-interest income                     211,870     152,951
                                               ----------  ----------
 General & Administrative Expenses

  Salaries & Benefits                             481,853     409,178
  Occupancy & Equipment                            93,241     104,639
  Data & Item Processing                           66,590      63,050
  Advertising & Marketing                          39,526      14,449
  Audit & Professional fees                        70,353      43,822
  Insurance                                         6,358       6,144
  Directors' fees and expenses                     20,451      22,071
  Other expenses                                  159,308     139,885
                                               ----------  ----------
    Total general & administrative expenses       937,680     803,238
                                               ----------  ----------
 Income before income tax expense                 282,575     436,490
 Income tax expense                               104,791     171,959
                                               ----------  ----------
    Total income                               $  177,784  $  264,531
                                               ==========  ==========
 Basic Earnings per share                      $     0.23  $     0.32
                                               ==========  ==========
 Diluted Earnings per share                    $     0.21  $     0.30
                                               ==========  ==========

                            CHINO COMMERCIAL BANCORP
                          Selected Financial Highlights

                                               For the Quarter Ended
                                              March 31,    March 31, 
                                                2007         2006
                                             -----------  -----------
 Selected Operating Data:                    (unaudited)

   Net interest income                       $ 1,074,278  $ 1,081,927
   Provision for loan losses                      65,893        8,750
   Non-interest income                           211,870      146,757
   Non-interest expense                          937,680      803,238
   Net income                                    177,784      264,531
  Share Data:
   Basic income per share                    $       .23  $      0.32
   Diluted Income per share                  $       .21  $      0.30
   Weighted average common shares
    outstanding
     Basic                                       722,468      818,453
     Diluted                                     834,495      883,992

 Performance Ratios:

   Return on average assets                         0.82%        1.22%
   Return on average equity                        10.53%       15.38%
   Equity to total assets at the end of the
    period                                          6.21%        7.33%
   Net interest spread                              2.54%        4.56%
   Net interest margin                              5.27%        5.61%
   Average interest-earning assets to
    average-bearing liabilities                   281.51%      354.51%
   Core efficiency ratio                           72.91%       64.29%
   Non-interest expense to average assets           4.32%        3.69%


 Selected Balance Sheet Data:                 March 31,   December 31,
                                                2007         2006
                                             -----------  -----------

   Total assets                              $92,698,769  $90,474,798
   Investment securities held to maturity      4,567,602    4,784,277
   Investment securities available for 
    sale                                      10,002,655   11,839,152
   Loan receivable, net                       51,608,516   51,021,235
   Deposits                                   83,348,837   79,454,135
   Non-interest bearing deposits              56,268,332   53,845,147
   Stockholders' equity                        5,753,158    7,453,441

 Regulatory capital ratios:

   Average equity to average assets                 7.77%        8.16%
   Leverage capital                                10.47%       11.05%
   Tier I risk based                               14.23%       15.89%
   Risk-based capital                              16.14%       16.92%

 Asset Quality Ratios:
   Allowance for loan losses as a percent
    of gross loans receivable                       1.32%        1.24%
   Net charge-offs to average loans                  n/a          n/a
   Non-performing loans to total loans               n/a          n/a

 Number of full-service customer facilities            2            2


            

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