CHINO, Calif., July 23, 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 second quarter ended June 30, 2007 with net earnings of $225,207 as compared with net earnings of $277,642 for the same quarter of 2006. The net earnings for the most recent quarter represent $0.29 per diluted share, as compared with $0.31 per diluted share, or reduction of 6.45% from the same quarter last year. Earnings year-to-date were $402,990 or $0.50 per diluted share as compared with net earnings of $542,173 or $0.61 per diluted share for the same period last year.
The reduction in net income for the second quarter was caused in part by an FDIC assessment of $20,519 and interest expense on trust preferred securities of $50,962 which were not present during the same quarter last year. The year-to-date earnings were also impacted by a provision for loan loss reserves during the first quarter of $77,174 coupled with the FDIC assessment in the second quarter as well as $101,925 in interest expense on trust preferred securities. These combined expenses, which were not experienced in 2006, lowered pre-tax earnings by roughly $122,400 in the second quarter, and $154,400 year-to-date.
Dann H. Bowman, President and Chief Executive Officer stated, "The formation of the Bank holding company last year, and certain regulatory expenses year-to-date make a direct comparison with last year's operations difficult; however, we are very pleased with the fundamentals of the Bank. At the end of the quarter the Bank had no delinquent or non-performing loans, no loans on non-accrual and no credit losses year-to-date."
Net earnings for the six months ended June 30, 2007 represent a return on average equity of 12.82% and a return on average assets of 0.93% compared to net earnings for the six months ended June 30, 2006 which represented a return on average equity of 15.46% and return on average assets of 1.22%.
Financial Condition
At June 30, 2007, total assets were $84.9 million, a decline of $5.6 million or 6.2% from December 31, 2006.
Loans decreased $2.2 million during the first half of 2007 from $51.8 million at December 31, 2006, to an outstanding balance of $49.6 million at June 30, 2007. This represents a 4.2% decrease. Although the outstanding balances decreased, the committed but undisbursed portion of loans increased $3.3 million.
Total deposits declined by 4.9% to $75.6 million at June 30, 2007, a decrease from $79.5 million at December 31, 2006. The Company's core deposits represent 96.9% of the total deposits.
Earnings
The Company posted net interest income for quarters ended June 30, 2007 and June 30, 2006 of $1,112,620 and $1,162,162, respectively. For six months ended June 30, the Company posted net interest income of $2,186,896 and $2,263,883 for 2007 and 2006, respectively. Average interest-earning assets were $76.7 million with average interest-bearing liabilities of $29.9 million, yielding a net interest margin of 5.69% for the six months ended June 30, 2007 as compared to average interest-bearing assets of $80.5 million with average interest-bearing liabilities of $23.6 million, yielding a net interest margin of 5.62% for the six months ended June 30, 2006.
Non-interest income totaled $229,289 for the three months ended June 30, 2007, or a 46.1% increase from $156,963 earned during the second quarter of 2006. Non-interest income increased 45.3% for the six months ended June 30, 2007, totaling $441,159 as compared to $303,720 for the six ended June 30, 2006. Service charges on deposit accounts accounted for the majority of the increase in non-interest income.
General and administrative expenses were $983,390 and $1,921,069 for the three and six months ended June 30, 2007, as compared to $844,139 and $1,647,377 for the three and six months ended June 30, 2006. The largest component of general and administrative expenses was salary and benefits expense of $496,303 for the second quarter of 2007 as compared to $433,195 for the three months ended June 30, 2006. Year-to-date comparisons of salary and benefits expense reports $978,155 for six months ended June 2007 and $842,343 for the same period in 2006. The increase in salaries and benefits expenses was reflective of staff increases, salary increases, incentive compensation, and the increase in retirement plan accruals.
Income tax expense was $138,561 and $243,352 for the three and six months June 30, 2007, as compared to $177,844 and $349,803 for the same periods of 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.
CHINO COMMERCIAL BANCORP
CONSOLIDATED BALANCE SHEET
June 30, 2007 and December 31, 2006
June 30, December 31,
2007 2006
------------ ------------
(unaudited)
ASSETS:
Cash and due from banks $ 6,044,733 $ 4,201,391
Federal funds sold 11,345,000 10,775,000
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Cash and cash equivalents 17,389,733 14,976,391
Interest-bearing deposits in other banks 496,000 2,541,000
Investment securities available for sale 8,470,207 11,839,152
Investment securities held to maturity
(fair value approximates $4,264,000 at
March 31, 2007 and $4,696,000 at
December 31, 2006) 4,372,852 4,784,277
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Total investments 13,339,059 19,164,429
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Loans
Construction 1,720,521 1,925,067
Real estate 36,445,989 37,521,967
Commercial 10,599,833 11,655,290
Installment 823,157 670,765
Unearned fees and discounts (113,495) (136,046)
Allowance for loan losses (676,452) (615,808)
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Total loans 48,799,553 51,021,235
------------ ------------
Restricted stock 643,250 627,500
Accrued interest receivable 294,285 385,764
Fixed assets, net 2,172,077 2,222,503
Prepaid & other assets 2,216,604 2,076,976
------------ ------------
Total assets $ 84,854,561 $ 90,474,798
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LIABILITIES:
Deposits
Non-interest bearing $ 49,080,460 $ 53,845,147
Interest Bearing 26,480,027 25,608,988
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Total deposits 75,560,487 79,454,135
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Accrued interest payable 57,283 61,477
Accrued expenses & other payables 431,725 412,745
Subordinated debentures 3,093,000 3,093,000
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Total liabilities 79,142,495 83,021,357
------------ ------------
STOCKHOLDERS' EQUITY
Common stock, authorized 10,000,000
shares with no par value, issued and
outstanding 714,732 shares and 808,214
shares at June 30, 2007 and December
31, 2006, respectively
2,868,257 5,022,984
Retained earnings 2,910,363 2,507,373
Accumulated other comprehensive loss (66,554) (76,916)
------------ ------------
Total equity 5,712,066 7,453,441
------------ ------------
Total liabilities & equity $ 84,854,561 $ 90,474,798
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CHINO COMMERCIAL BANCORP
CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
For the three For the six
months ended months ended
June 30 June 30
2007 2006 2007 2006
---------- ---------- ---------- ----------
Interest income
Interest on
investment
securities $ 149,129 $ 304,404 $ 314,051 $ 597,278
Interest on Federal
funds and Due From
Banks Time 155,723 108,702 298,866 186,576
Interest and fee
income on loans 1,025,614 865,034 2,002,785 1,676,213
---------- ---------- ---------- ----------
Total interest
income 1,330,466 1,278,140 2,615,702 2,460,067
---------- ---------- ---------- ----------
Interest expense
Deposits 166,584 115,678 326,281 195,584
Other borrowings 51,262 300 102,525 600
---------- ---------- ---------- ----------
Total interest
expense 217,846 115,978 428,806 196,184
---------- ---------- ---------- ----------
Net interest income 1,112,620 1,162,162 2,186,896 2,263,883
---------- ---------- ---------- ----------
Provision for loan
losses (5,249) 19,500 60,644 28,250
---------- ---------- ---------- ----------
Net interest income
after provision
for loan losses 1,117,869 1,142,662 2,126,252 2,235,633
---------- ---------- ---------- ----------
Non-interest income
Service charges on
deposit accounts 194,739 134,926 372,421 263,874
Other miscellaneous
fee income 7,693 4,793 16,803 7,921
Dividend income from
restricted stock 11,638 1,740 20,513 1,740
Income from bank
owned life
insurance 15,219 15,504 31,422 30,185
---------- ---------- ---------- ----------
Total non-
interest income 229,289 156,963 441,159 303,720
---------- ---------- ---------- ----------
General and
administrative
expenses
Salaries and
employee benefits 496,303 433,195 978,155 842,373
Occupancy and
equipment 87,083 97,314 180,323 201,953
Data and item
processing 78,768 61,753 145,358 122,711
Advertising and
marketing 35,845 25,529 75,371 39,978
Legal and
professional fees 85,018 45,541 155,369 89,363
Insurance 8,187 6,196 14,545 12,340
Directors' fees and
expenses 19,800 22,285 40,250 44,356
Other expenses 172,386 152,326 331,698 294,303
---------- ---------- ---------- ----------
Total general &
administrative
expenses 983,390 844,139 1,921,069 1,647,377
---------- ---------- ---------- ----------
Income before income
tax expense 363,768 455,486 646,342 891,976
Income tax expense 138,561 177,844 243,352 349,803
---------- ---------- ---------- ----------
Total income $ 225,207 $ 277,642 $ 402,990 $ 542,173
========== ========== ========== ==========
Basic earnings per
share $ 0.31 $ 0.34 $ 0.54 $ 0.66
========== ========== ========== ==========
Diluted earnings per
share $ 0.29 $ 0.31 $ 0.50 $ 0.61
========== ========== ========== ==========