Chino Commercial Bancorp (CCBC) 8-K Results of Operations and Financial Condition

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 OR 15(d) of
The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported)July 23, 2007

CHINO COMMERCIAL BANCORP

(Exact name of registrant as specified in its charter)

CA	000-52098	20-4797048
(State of incorporation)	(Commission File Number)	(IRS Employer
		Identification No.)
14345 Pipeline Avenue
Chino, California		91710
Address of Principal Executive Offices		Zip Code

(909) 393-8880
Registrant’s telephone number, including area code

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the follow provisions:

¨      Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨      Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨      Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨      Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Results of Operations and Financial Condition

On July 23, 2007 the Registrant issued a press release, a copy of which is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

Exhibit 99.1.

Press release dated July 23, 2007

For Release
July 23, 2007
OTC BB: “CCBC”

CHINO COMMERCIAL BANCORP REPORTS SECOND QUARTER EARNINGS

     Chino, California… The Board of Directors of Chino Commercial Bancorp, 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, man y 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
(unaudited)
		June 30, 2007			December 31, 2006
ASSETS:
Cash and due from banks	$	6,044,733		$	4,201,391
Federal funds sold		11,345,000			10,775,000
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
Total investments		13,339,059			19,164,429
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	)
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
LIABILITIES:
Deposits
Non-interest bearing	$	49,080,460		$	53,845,147
Interest Bearing		26,480,027			25,608,988
Total deposits		75,560,487			79,454,135
Accrued interest payable		57,283			61,477
Accrued expenses & other payables		431,725			412,745
Subordinated debentures		3,093,000			3,093,000
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

CHINO COMMERCIAL BANCORP
CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
		For the three months ended					For the six months ended
		June 30					June 30
		2007			2006		2007		2006
Interest income
Interest on investment scurities	$	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

SIGNATURE

     Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

July 23, 2007

By:/s/ Sandra F. Pender                               
Sandra F. Pender
Vice President and Chief Financial Officer