CHINO, Calif., Oct. 20, 2008 (GLOBE NEWSWIRE) -- The Board of Directors of Chino Commercial Bancorp (OTCBB: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 third quarter ended September 30, 2008 with net earnings of $72,654, a 65.3% reduction from $209,476 for the same quarter of 2007. The net earnings for the most recent quarter represents $0.10 per diluted share, as compared with $0.27 per diluted share, or a reduction of 63.0% from the same quarter last year. Earnings year-to-date was $260,530 or $0.34 per diluted share as compared with net earnings of $612,466 or $0.77 per diluted share for the same period last year.
Dann H. Bowman, President and Chief Executive Officer stated, "Despite earnings declining during the third quarter of the year due to higher provisions to Loan Loss Reserve, we are very pleased with the continued stability and earnings of the Bank overall. During a time when many organizations are suffering from credit problems, at the end of September the Bank had only two loans which were delinquent more than 60 days and only one loan on non-accrual."
Financial Condition
Total assets declined from $79.9 million to $77.5 million or 3.1% between December 31, 2007 and September 30, 2008, resulting from decreased loan balances and investment securities, offset with increased Federal funds sold which are funded with deposit balances.
The Company experienced a decrease in interest-earning assets of $4.7 million or 6.5% to $71.9 million in the first three quarters of 2008. Loan demand and Investment securities decreased $5.1 million and $2.6 million, respectively, in the first nine months of 2008. Undisbursed loan commitments decreased $1.7 million to $5.9 million at September 30, 2008. No new investment securities have been added in 2008, and the decreases were caused by maturities and principal payments from Mortgage-backed securities. Federal funds sold increased $4.6 million or 41.9% as loans demand and deposits balances stabilized during the third quarter.
Total deposits decreased from $70.4 million at December 31, 2007 to $67.8 million at September 30, 2008, or a 3.7% reduction. Total non-interest bearing deposits decreased from $42.3 million at December 31, 2007 to $34.8 million for the reporting period ended September 30, 2008, a 17.7% decrease. Interest-bearing liabilities increased $4.8 million or 17.2% to $33.0 million in the nine months ended September 30, 2008 as compared to December 31, 2007. The increase in interest-bearing deposits is the result of the Company's emphasis to attract new customers.
Earnings
The Company posted net interest income for the quarters ended September 30, 2008 and September 30, 2007 of $854,027 and $1,022,467, respectively. For the nine months ended September 30, the Company posted net interest income of $2,639,085 and $3,209,364 for 2008 and 2007, respectively. Average interest-earning assets were $66.4 million with average interest-bearing liabilities of $32.3 million yielding a net interest margin of 5.31% for the nine months ended September 30, 2008 as compared to average interest-bearing assets of $76.6 million with average interest-bearing liabilities of $30.5 million yielding a net interest margin of 5.61% for the nine months ended September 30, 2007.
Non-interest income totaled $259,509 for the three months ended September 30, 2008, or a 1.3% increase from $256,077 earned during the third quarter of 2007. Non-interest income increased 17.5% for the nine months ended September 30, 2008 totaling $819,253 as compared to $697,236 for the nine months ended September 30, 2007. Service charges on deposit accounts accounted for the majority of the increase in non-interest income.
General and administrative expenses were $889,427 and $2,674,723 for the three and nine months ended September 30, 2008 as compared to $895,791 and $2,816,860 for the three and nine months ended September 30, 2007. The largest component of general and administrative expenses was salary and benefits expense of $467,413 for the third quarter of 2008 as compared to $461,870 for the three months ended September 30, 2007. Year-to-date comparisons of salary and benefits expense reports $1,444,704 for nine months ended September 30, 2008 and $1,440,026 for the same period in 2007.
Income tax expense was $31,731 and $124,957 for the three and nine months ended September 30, 2008, as compared to $127,718 and $371,071 for the same periods of 2007. The effective income tax rate for 2008 is approximately 32.4% and 2007 is approximately 37.7%. Of the $385,487 pre-tax income for the nine months ended September 30, 2008, approximately $83,300 was tax exempt.
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 detailed in the Company's SEC filings.
CHINO COMMERCIAL BANCORP
CONSOLIDATED BALANCE SHEET
September 30, 2008 and December 31, 2007
September 30, December 31,
2008 2007
------------ ------------
(unaudited) (audited)
ASSETS:
Cash and due from banks $ 5,010,809 $ 3,487,933
Federal funds sold 10,500,000 7,440,000
------------ ------------
Cash and cash equivalents 15,510,809 10,927,933
Interest-bearing deposits in other banks 99,000 99,000
Investment securities available for sale 5,255,055 7,339,354
Investment securities held to maturity
(fair value approximates $3,333,000 at
September 30, 2008 and $3,880,000 at
December 31, 2007) 3,323,939 3,873,251
------------ ------------
Total investments 8,677,994 11,311,605
------------ ------------
Loans
Construction 605,229 2,606,750
Real estate 36,686,193 39,726,301
Commercial 10,209,252 10,062,969
Installment 575,426 790,535
------------ ------------
Gross loans 48,076,100 53,186,555
Unearned fees and discounts (67,841) (87,389)
------------ ------------
Loans net of unearned fees and discount 48,008,259 53,099,166
Allowance for loan losses (662,180) (725,211)
------------ ------------
Net loans 47,346,079 52,373,955
------------ ------------
Accrued interest receivable 258,599 326,990
Restricted stock 673,250 654,250
Fixed assets, net 1,982,540 2,085,203
Prepaid & other assets 3,017,706 2,268,909
------------ ------------
Total assets $ 77,466,977 $ 79,948,845
============ ============
LIABILITIES:
Deposits
Non-interest bearing $ 34,783,525 $ 42,270,696
Interest Bearing
NOW and money market 24,663,984 22,711,556
Savings 1,104,082 1,202,965
Time deposits less than $100,000 2,983,045 2,054,915
Time deposits of $100,000 or greater 4,223,904 2,156,778
------------ ------------
Total deposits 67,758,540 70,396,910
------------ ------------
Accrued interest payable 56,700 63,962
Accrued expenses & other payables 559,088 509,389
Subordinated debentures 3,093,000 3,093,000
------------ ------------
Total liabilities 71,467,328 74,063,261
------------ ------------
STOCKHOLDERS' EQUITY
Common stock, authorized 10,000,000
shares with no par value, issued and
outstanding 699,798 shares and 704,278
shares at September 30, 2008 and
December 31, 2007, respectively 2,539,714 2,639,462
Retained earnings 3,485,818 3,249,982
Accumulated other comprehensive loss (25,883) (3,860)
------------ ------------
Total equity 5,999,649 5,885,584
------------ ------------
Total liabilities & stockholders'
equity $ 77,466,977 $ 79,948,845
============ ============
CHINO COMMERCIAL BANCORP
CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
For the three months For the six months
ended September 30 ended September 30
2008 2007 2008 2007
---------- ---------- ---------- ----------
Interest income
Investment securities
and due from banks $ 102,966 $ 143,782 $ 341,064 $ 496,815
Interest on Federal
funds sold 35,855 120,811 66,832 380,695
Interest and fee
income on loans 948,483 1,010,948 2,932,847 3,013,734
---------- ---------- ---------- ----------
Total interest income 1,087,304 1,275,541 3,340,743 3,891,244
---------- ---------- ---------- ----------
Interest expense
Deposits 182,314 201,811 547,797 528,093
Interest on Federal
funds purchased 0 0 973 0
Other borrowings 50,963 51,263 152,888 153,787
---------- ---------- ---------- ----------
Total interest
expense 233,277 253,074 701,658 681,880
---------- ---------- ---------- ----------
Net interest income 854,027 1,022,467 2,639,085 3,209,364
---------- ---------- ---------- ----------
Provision for loan
losses 119,724 45,559 398,128 106,203
---------- ---------- ---------- ----------
Net interest income
after provision for
loan losses 734,303 976,908 2,240,957 3,103,161
---------- ---------- ---------- ----------
Non-interest income
Service charges on
deposit accounts 223,922 223,438 708,745 595,859
Other miscellaneous
fee income 9,412 9,607 27,131 26,410
Dividend income from
restricted stock 9,978 7,639 36,461 28,152
Income from bank owned
life insurance 16,197 15,393 46,916 46,815
---------- ---------- ---------- ----------
Total non-interest
income 259,509 256,077 819,253 697,236
---------- ---------- ---------- ----------
General and
administrative
expenses
Salaries and employee
benefits 467,413 461,870 1,444,704 1,440,026
Occupancy and
equipment 95,552 77,122 261,912 257,445
Data and item
processing 80,659 85,827 245,726 243,934
Advertising and
marketing 19,889 37,837 60,504 113,208
Legal and professional
fees 49,142 53,904 144,763 162,064
Regulatory Assessments 22,039 22,070 63,337 69,280
Insurance 7,898 8,141 23,894 22,686
Directors' fees and
expenses 19,417 19,382 57,718 59,633
Other expenses 127,418 129,638 372,165 448,584
---------- ---------- ---------- ----------
Total general &
administrative
expenses 889,427 895,791 2,674,723 2,816,860
---------- ---------- ---------- ----------
Income before income
tax expense 104,385 337,194 385,487 983,537
Income tax expense 31,731 127,718 124,957 371,071
---------- ---------- ---------- ----------
Total income $ 72,654 $ 209,476 $ 260,530 $ 612,466
========== ========== ========== ==========
Basic earnings per
share $ 0.10 $ 0.29 $ 0.37 $ 0.83
========== ========== ========== ==========
Diluted earnings per
share $ 0.10 $ 0.27 $ 0.34 $ 0.77
========== ========== ========== ==========
CREDIT QUALITY End of period
(unaudited) September 30, December 31,
2008 2007
------------ ------------
Non-Performing Loans $ 461,049 $ --
============ ============
Non-Performing Loans to Total Loans 0.96% n/a
Non-Performing Loans to Total Assets 0.60% n/a
Allowance for Loan Losses to Loans 1.38% 1.36%
OTHER PERIOD-END STATISTICS End of period
(unaudited) September 30, December 31,
2008 2007
------------ ------------
Shareholders Equity to Total Assets 7.74% 7.36%
Loans to Deposit 70.95% 75.55%
Non-Interest Bearing Deposits to Total
Deposits 51.33% 60.05%
For the three For the nine
months ended months ended
September 30 September 30
2008 2007 2008 2007
-------- -------- -------- --------
KEY FINANCIAL RATIOS
(unaudited)
Return on Average Equity 5.02% 15.89% 13.41% 31.61%
Return on Average Assets 0.38% 1.00% 1.04% 2.14%
Net Interest Margin 5.13% 5.51% 7.95% 5.63%
Efficiency Ratio 79.87% 70.06% 77.34% 72.11%
Net Chargeoffs to Average Loans 0.80% 0.02% 0.63% 0.02%
AVERAGE BALANCES
(thousands, unaudited)
Average Assets $ 75,750 $ 84,065 $ 75,052 $ 85,775
Average Interest-Earning
Assets $ 66,587 $ 74,795 $ 66,427 $ 76,552
Average Gross Loans $ 50,226 $ 52,182 $ 52,583 $ 51,289
Average Deposits $ 65,839 $ 74,337 $ 65,213 $ 75,692
Average Equity $ 5,786 $ 5,274 $ 5,830 $ 5,813