10/22/2018: 30% INCREASE IN NET EARNINGS

30% INCREASE IN NET EARNINGS

Chino, California, October 19, 2018 – The Board of Directors of Chino Commercial Bancorp (OTC: 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, 2018, with net earnings of $595.3 thousand, or an increase of 29.8%, compared with net income of $458.5 thousand for the same quarter last year. Net income per basic and diluted share was $0.32 for the third quarter of 2018 and $0.23 for the same quarter last year.

Dann H. Bowman, President and Chief Executive Officer, stated, “The fundamentals of the Bank remain very strong. During the third quarter, not only did the Bank achieve new record levels for Deposits, Loans, Revenue and Earnings, but loan quality also remains very strong, and capital levels are high. In terms of business expansion, the Upland branch opened on October 1st, and we are pleased and excited about the business prospects in this region, as well as the Inland Empire overall.”

Financial Condition

At September 30, 2018, total assets were $202.2 million, an increase of $9.4 million or 4.9% over $192.8 million at December 31, 2017. Total deposits increased by 17.3% or $25.7 million during the third quarter to $174.9 million, compared to $149.1 million as of December 31, 2017. At September 30, 2018, the Company’s core deposits represent 97.5% of the total deposits.

Gross loans increased by 6.8% or $8.3 million as of September 30, 2018 to $130.9 million, as compared with $122.6 million as of December 31, 2017. The Bank had one non-performing loan for the quarter ended September 30, 2018, and no non-performing loans at December 31, 2017, respectively. OREO properties remained at zero as of September 30, 2018 and December 31, 2017, respectively.

Earnings

The Company posted net interest income of $1.8 million and $1.6 million for the three months ended September 30, 2018 and 2017, respectively, or an increase of $225 thousand or 13.8%. Average interest-earning assets were $180.8 million with average interest-bearing liabilities of $95.0 million, yielding a net interest margin of 4.06% for the third quarter of 2018, as compared to the average interest-earning assets of $176.7 million with average interest-bearing liabilities of $101.2 million, yielding a net interest margin of 3.65% for the third quarter of 2017.

Non-interest income totaled $380.6 thousand for the third quarter of 2018, or a decrease of 2.2% as compared with $389 thousand earned during the same quarter last year. Service charges on deposit accounts increased by $5 thousand or 1.6% to $314.2 thousand, primarily due to an increase in income from returned items, overdraft charges, and analysis fees. Dividend income from restricted stock decreased to $16 thousand for the third quarter of 2018, compared to $36.4 thousand for the same quarter in 2017, due to the Federal Home Loan Bank change in dividend payout percentage policy. Income from Bank-owned life insurance remained consistent at about $25 thousand in the third quarter of 2018 and 2017, respectively.

General and administrative expenses were $1.4 million for the three months ended September 30, 2018, and 1.2 million for the same period last year. The largest component of general and administrative expenses was salary and benefits expense of $863 thousand for the third quarter of 2018, as compared to $732 thousand for the same quarter last year. Advertising and marketing expenses remained consistent at about $25 thousand in the third quarter of 2018 and 2017, respectively.

Income tax expense was $239 thousand which represents a decrease of $61 thousand or 20.2% for the three months ended September 30, 2018 as compared to $299.5 thousand for the three months ended September 30, 2017. The effective income tax rate for the third quarter of 2018 and 2017 is approximately 28.6% and 39.5%, respectively. The decrease in the income tax expense, as well as the effective tax rate, are entirely attributed to the new Tax Reform Act signed into law in December 2017.

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 therefrom, and changes in interest rates, loan portfolio performance, and other factors.

Contact: Dann H. Bowman, President and CEO or Melinda M. Milincu, Vice President and CFO, Chino Commercial Bancorp and Chino Commercial Bank, N.A., 14245 Pipeline Avenue, Chino, Ca. 91710, (909) 393- 8880.