Chino Commercial Bancorp Reports 33.6% Increase In Profits

CHINO, Calif., Jan. 18, 2013 /PRNewswire/ -- 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 three and twelve months ended December 31, 2012. For the full year ended December 31, 2012 the company posted a consolidated net income of $589,766, an increase of 33.6% over net income of $441,401 for the year end 2011. Net income for the quarter ended December 31, 2012 decreased 35.8% to $107,796 from $167,928 for quarter ended December 31, 2011. Net income per basic share and fully diluted share was $0.72 for the year ended December 31, 2012 a 22.0% increase over $0.59 per share for the year ended December 31, 2011. Earnings basic share and diluted share for the fourth quarter ended December 31, 2012 were $0.13, as compared to $0.22 for the fourth quarter of 2011.

Dann H. Bowman, President and Chief Executive Officer stated, "We are very pleased to report that the Company had an excellent year, with net earnings increasing 33% over last year and loan quality improving.  At year-end the Bank had only one delinquent loan; and though economic conditions have not fully recovered, we are becoming increasingly optimistic regarding the economy and the Inland Empire Region in general. Many of our borrowers are reporting higher earnings and improved business conditions.  During the year the Bank's deposits increased 4.1% and loans increased 9.1%. Though the economy is not out of the woods yet, we believe the Bank is well positioned to benefit from the improved economic and business conditions."

Financial Condition

Non-interest bearing deposits increased 3.5% to $48.8 million at December 31, 2012 from $47.2 million at December 31, 2011. Total deposits at December 31, 2012 totaled $102.2 million, an increase of 4.1% from $98.1 million at December 31, 2011. Core deposits decreased 0.8%, to $85.9 million at December 31, 2012 from $86.6 million at December 31, 2011. The Bank's core deposits to total deposits increased to a very favorable 89.8% of total deposits at December 31, 2012 from 89.6% at December 31, 2011.

At December 31, 2012, total assets were $114.6 million, an increase of $4.9 million or 4.5% from 109.7 million at December 31, 2011.

Gross loans increased to $62.0 million at December 31, 2012 from $56.8 million at December 31, 2011, or an increase of 9.1%, and total investments and Federal funds sold increased slightly to $41.4 million from $40.1 million at December 31, 2011, a 3.2% decrease.

The level of "non-performing" loans decreased during the year to $1.2 million at December 31, 2012 from $3.6 million at December 31, 2011 or a 66.3% decrease. Many of these loans have been graded as non-performing based on information contained in the borrower's income tax returns. At year-end all of the non-performing loans except one, were current on their scheduled payments. At year-end the Bank had only one loan which was more than 30 days delinquent for $517,916.

The level of net loan charge-offs increased during the year to $219,428 in 2012 from $185,909 in 2011, or an increase of $33,529. Net loan loss as a percent of gross loans was 0.35% and 0.33% for years ended December 31, 2012 and 2011, respectively. It is important to note, however, that of the charge-offs taken in 2012 of $82,744 and in 2011 of $127,035 were charge-offs against loans that were paying as agreed. In many cases these charge-offs were taken to reflect reduced real estate collateral values.

Earnings

The Company posted net interest income of $3,654,006 for the year ended December 31, 2012 as compared to $3,732,455 for the year ended December 31, 2011. Average interest-earning assets were $98.2 million with average interest-bearing liabilities of $54.7 million yielding a net interest margin of 3.72% for the year ended December 31, 2012 as compared to average interest-earning assets of $93.7 million with average interest-bearing liabilities of $56.0 million yielding a net interest margin of 3.97% for the year ended December 31, 2011.

The Bank posted net interest income of $956,008 for the three months ended December 31, 2012 as compared to $926,160 for the three months ended December 31, 2011. Average interest-earning assets were $104.6 million with average interest-bearing liabilities of $57.5 million yielding a net interest margin of 3.64% for the fourth quarter of 2012 as compared to average interest-earning assets of $93.9 million with average interest-bearing liabilities of $54.1 million yielding a net interest margin of 3.91% for the three months ended December 31, 2011.

Non-interest income totaled $1,436,537, or an increase of 6.6% from $1,347,803, earned in the year ended December 31, 2011. Service charges on deposit accounts decreased $22,064 or 1.9% to $1,151,235 in 2012 due the reversal of $21,943 of collected income from customers with loans on non-accrual status. Gain on sale of foreclosed assets increased to $93,871 in 2012 from $61,151 for the year ended December 31, 2011 due to gain on sale OREO.

Non-interest income for the quarter ended December 31, 2012 totaled $335,428 or an 8.5% increase from the fourth quarter of 2011. The increase is due to legal expenses reimbursed from fees expensed in prior years.

General and administrative expenses were $1,008,824 for the three months ended December 31, 2012 or an increase of 4.17% as compared to $969,519 for the three months ended December 31, 2011. General and administrative expenses were $4,045,169 for the year ended December 31, 2012 as compared to $4,118,282 for the year ended December 31, 2011. The largest component of general and administrative expenses was salary and benefits expense which totaled $545,229 for the three months ended December 31, 2012 as compared to $535,442 for the three months ended December 31, 2011. Salary and benefits expense were $2,178,453 for the year ended December 31, 2012 as compared to $2,182,644 for the year ended December 31, 2011.

The consolidated Company's income tax expense was $56,592 for the three months ended December 31, 2012 as compared to $97,688 for the three months ended December 31, 2011. Income tax expenses were $335,336 for the year ended December 31, 2012 as compared to $229,685 for the year ended December 31, 2011. The effective income tax rate for 2012 and 2011 was approximately 36.2% and 34.2%, 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 detailed in the Company's SEC filings.

SOURCE Chino Commercial Bancorp