CHICAGO, July 15 /PRNewswire-FirstCall/ --
Fidelity Bancorp, Inc. (Nasdaq: FBCI), the parent company of Fidelity Federal
Savings Bank, today reported fiscal third quarter earnings of $0.69 per
diluted share for the period ended June 30, 2002. The company also announced
its board of directors declared a quarterly dividend of $0.09 per share,
payable August 15, 2002 to stockholders of record as of July 31, 2002. All
figures reported for earnings per share and dividends have been adjusted to
reflect the company's three-for-two stock split, which occurred February 28,
2002.
Earnings per diluted share for the quarter ended June 30, 2002 were up
$0.35 per share, from $0.34 per share for the same period in 2001. Net income
for the quarter ended June 30, 2002 was $2.2 million, compared with
$1.1 million for the same quarter in 2001. Earnings per share and net income
for the quarter were up from the previous year's results primarily due to an
improved net interest margin and increased non-interest income.
For the first nine months of the fiscal year, earnings per diluted share
were $1.89, up $0.94 per share from $0.95 per share for the nine month period
in 2001. Net income for the first nine months of 2002 was $6.0 million,
compared with $3.0 million in 2001.
"Our net interest margin continues to improve, which was the primary
contributor to our excellent results this quarter," said Raymond S.
Stolarczyk, chairman and chief executive officer. "Interest expense has
declined to our benefit, but we've also been able to maintain steady levels of
income from earning assets. Our goal now is to manage that net interest
margin in a more stable interest rate environment."
The bank's net interest margin increased to 3.28% for the nine months
ended June 30, 2002, from 2.27% in 2001. Net interest income was
$16.0 million, compared with $10.6 million in the prior nine-month period, up
$5.4 million or 52%.
Total interest expense for the nine months ended June 30, 2002 was
$17.4 million, down $6.8 million or 28% from $24.2 million for the same period
in 2001. Interest expense on borrowed funds declined 29% to $6.7 million for
the nine months ended June 30, 2002, compared with $9.5 million in 2001. The
decline was due to maturing borrowed funds being replaced with funds borrowed
at lower rates.
For the nine months ended June 30, 2002, interest expense on deposits was
$10.6 million, down $4.1 million or 28% from $14.7 million in 2001. Deposit
interest expense declined as the result of lower interest rates and a greater
number of transaction accounts in the deposit mix.
"During the quarter, $12 million in higher-rate certificates of deposit
matured, which provided the bank the opportunity to reduce interest costs
while retaining the majority of the funds," said Thomas E. Bentel, president
and chief operating officer. "In addition, we're encouraging customers to
extend their maturities beyond one year, which will help stabilize our
interest rate sensitivity into the future."
Total deposits were $435.7 million for the nine months ended June 30,
2002, up 9% from $399.6 million at September 30, 2001. Transaction account
growth remains the company's focus as a means to both build deposits and
further reduce interest expense.
The company was successful in preserving total interest income in the
third quarter, in spite of the low interest rate environment and continued
high loan turnover. Total interest income was $33.4 million for the nine
months ended June 30, 2002, down just $1.4 million or 4% from $34.8 million in
2001. Interest income from loans receivable was $23.7 million for the nine
months ended June 30, 2002, compared with $29.8 million in 2001. Income from
loans receivable fell primarily as a result of a decline in the average
balance of loans outstanding due to the sales of loans during previous
quarters. Offsetting the decline in interest income from loans receivable was
income from mortgage-backed securities, which totaled $6.7 million for the
nine months ended June 30, 2002, compared with $357,000 in 2001.
Net loans receivable at June 30, 2002 were $427.9 million, compared with
$423.0 million at September 30, 2001. While loan demand has remained steady,
the low interest rate environment has produced increased repayments. New loans
closed, including multi-family and commercial mortgages and loans secured by
commercial leases, totaled $131.6 million for the nine months ended June 30,
2002. Loan repayments totaled $129.6 for the nine months ended June 30, 2002,
compared with $112.2 for the same period in 2001.
Non-interest income was up $1.1 million to $2.4 million for the nine-month
period ended June 30, 2002 from $1.3 million in 2001. During the first nine
months of fiscal 2002, the sale of loans and investments produced a
$1.2 million pre-tax gain, compared with a $308,000 pre-tax gain in 2001.
Insurance and annuity commissions contributed $638,000 for the nine months, up
slightly from $625,000 in 2001. Without the gain on the sale of loans and
investments, non-interest income for the nine-month period in 2002 was
essentially unchanged from 2001.
Non-interest expense increased to $8.4 million for the nine months ended
June 30, 2002, compared with $7.1 million in the same period in 2001, up 19%.
Employee benefits, including higher group health insurance premiums,
accelerated depreciation for obsolescence in the company's computer hardware
and software and increased advertising expenses contributed to the increase.
The company's asset quality remained excellent, although the weakened
economy was reflected in an increase in the company's ratio of non-performing
assets to total assets. At June 30, 2002, the ratio of non-performing assets
to total assets was 0.22%, compared with 0.10% at September 30, 2001.
"There was no change in the company's non-performing assets ratio from the
second to the third quarter, a good indication that our underwriting standards
are withstanding any economic softness," said Bentel.
Book value per share at June 30, 2002 was $17.35, compared with $16.30 at
September 30, 2001. The increase in book value per share was due to earnings
retained, offset by a decrease in the unrealized loss, net of tax, of
securities available for sale.
The company saw a significant improvement in return on equity, as well as
certain other measures. The company's return on average equity increased to
15.85% for the nine months ended June 30, 2002, compared with 8.87% for the
period ended June 30, 2001. The company's operating efficiency also improved,
as reflected in its efficiency ratio, which improved to 45.49% for the nine
months ended June 30, 2002, from 59.19% for the nine months ended June 30,
2001.
The company will host a telephone conference call to discuss the quarter's
results on Tuesday, July 16, 2002 at 2:30 p.m. (CT). To participate in the
call, dial 1 (800) 388-8975 and reference I.D # R539362.
Fidelity Bancorp, Inc. is the holding company for Fidelity Federal Savings
Bank, which provides retail banking services through five full-service
locations in Chicago, Franklin Park and Schaumburg. Established in 1906 and
headquartered in northwest Chicago, the bank is primarily in the business of
attracting retail deposits from the general public and investing those funds
in mortgages and consumer loans. The bank also provides investments that are
not FDIC insured through its insurance agency and Invest Financial
Corporation. Fidelity's common stock is traded on The Nasdaq Stock Market
under the symbol "FBCI."
Fidelity Bancorp Inc.'s news releases are available by mail or fax by
contacting the company. News releases are also available on the Internet by
visiting http://www.prnewswire.com and clicking on "Today's News" and then "Company
News" from the pull down menu. The company's SEC filings are available
electronically on the Internet at http://www.sec.gov/cgi-bin/srch-edgar?0000912219 .
This document (including information incorporated by reference) contains,
and future oral and written statements of the Company and its management may
contain, forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995 with respect to the financial
condition, results of operations, plans, objectives, future performance and
business of the Company. Forward-looking statements, which may be based upon
beliefs, expectations and assumptions of the Company's management and on
information currently available to management, are generally identifiable by
the use of words such as "believe," "expect," "anticipate," "plan," "intend,"
"estimate," "may," "will," "would," "could," "should" or other similar
expressions. Additionally, all statements in this document, including
forward-looking statements, speak only as of the date they are made, and the
Company undertakes no obligation to update any statement in light of new
information or future events.
A number of factors, many of which are beyond the ability of the Company
to control or predict, could cause actual results to differ materially from
those in its forward-looking statements. These factors include, among others,
the following: (i) the strength of the local and national economy; (ii) the
economic impact of September 11th; (iii) changes in state and federal laws,
regulations and governmental policies concerning the Company's general
business; (iv) changes in interest rates and prepayment rates of the Company's
assets; (v) increased competition in the financial services sector and the
inability to attract new customers; (vi) changes in technology and the ability
to develop and maintain secure and reliable electronic systems; (vii) the loss
of key executives or employees; (viii) changes in consumer spending; (ix)
unexpected results of acquisitions; (x) unexpected outcomes of existing or new
litigation involving the Company; and (xi) changes in accounting policies and
practices. These risks and uncertainties should be considered in evaluating
forward-looking statements and undue reliance should not be placed on such
statements. Additional information concerning the Company and its business,
including additional factors that could materially affect the Company's
financial results, is included in the Company's filings with the Securities
and Exchange Commission.
FIDELITY BANCORP and SUBSIDIARY
Consolidated Statements of Financial Condition
Dollars in thousands (except per share data)
Assets June 30, September 30,
2002 2001
Cash and due from banks $6,707 $7,107
Interest-earning deposits 3,021 1,397
Federal funds sold 100 100
Cash and cash equivalents 9,828 8,604
FHLB of Chicago stock, at cost 31,665 18,055
Mortgage-backed securities available for sale 179,264 127,685
Securities available for sale 35,856 42,006
Loans receivable, net of allowance for loan
losses of $1,678 at June 30, 2001 and $1,236
at September 30, 2000 427,857 422,980
Loans held for sale 83 41,219
Accrued interest receivable 3,581 3,650
Premises and equipment 3,634 3,850
Other assets 1,211 657
$692,979 668,706
Liabilities and Stockholders' Equity
Liabilities
Deposits 435,739 399,619
Borrowed funds 157,220 187,345
Advance payments by borrowers for taxes and
insurance 4,292 7,193
Due to broker 35,374 14,918
Other liabilities 6,896 10,247
Total liabilities 639,521 619,322
Stockholders' Equity
Preferred stock - -
Common stock 57 38
Additional paid-in capital 38,450 38,636
Retained earnings, substantially restricted 46,185 40,926
Treasury stock, at cost (30,932) (31,540)
Common stock acquired by Bank Recognition
and Retention Plans (159) (178)
Accumulated other comprehensive income (loss) (143) 1,502
Total stockholders' equity 53,458 49,384
$692,979 668,706
FIDELITY BANCORP and SUBSIDIARY
Consolidated Statements of Earnings
Dollars in thousands (except for earnings per share)
Three Months Ended Nine Months Ended
June 30, June 30,
2002 2001 2002 2001
Interest Income:
Loans receivable $7,665 9,532 23,729 29,825
Securities 995 1,385 2,999 4,544
Mortgage-backed
securities 2,524 251 6,669 357
Other interest income 8 17 26 48
11,192 11,185 33,423 34,774
Interest Expense:
Deposits 3,283 4,760 10,642 14,737
Borrowed funds 2,091 2,808 6,736 9,467
5,374 7,568 17,378 24,204
Net interest income
before provision for
loan losses 5,818 3,617 16,045 10,570
Provision for loan
losses 200 70 450 180
Net interest income
after provision for
loan losses 5,618 3,547 15,595 10,390
Non-interest Income:
Fees and commissions 195 118 495 351
Insurance and annuity
commissions 208 222 638 625
Gain on sale of
investment securities 239 77 534 202
Gain on sale of loans 10 - 676 -
Other 11 27 31 163
663 444 2,374 1,341
Non-interest Expense:
General and
administrative expenses:
Salaries and employee
benefits 1,569 1,299 4,844 4,103
Office occupancy and
equipment 527 392 1,403 1,145
Data processing 109 98 371 375
Advertising and
promotions 135 123 449 327
Other 456 345 1,312 1,100
2,796 2,257 8,379 7,050
Income before income
taxes 3,485 1,734 9,590 4,681
Income tax expense 1,262 647 3,544 1,682
Net income $2,223 1,087 6,046 2,999
Earnings per share -
basic $0.72 0.36 1.97 0.99
Earnings per share -
diluted $0.69 0.34 1.89 0.95
FIDELITY BANCORP and SUBSIDIARY
Financial Highlights (unaudited)
Dollars in thousands (except for book value and earnings per share)
June 30, September 30,
2002 2001
Selected Financial Highlights:
Total assets $692,979 668,706
Interest-earning assets 677,846 653,442
Loans receivable, net 427,857 422,980
Deposits 435,739 399,619
Borrowed funds 157,220 187,345
Non-performing assets 1,405 677
Non-performing loans 961 677
Allowance for loan losses 1,678 1,236
Stockholders' equity 53,458 49,384
Book value per share (A) 17.35 16.30
Shares outstanding - actual number (A) 3,081,490 3,030,490
Asset Quality Ratios:
Non-performing loans to loans receivable, net 0.22% 0.16%
Non-performing loans to total assets 0.14% 0.10%
Non-performing assets to total assets 0.20% 0.10%
Allowance for loan losses to total
non-performing loans 174.61% 182.57%
Allowance for loan losses to loans receivable,
net 0.39% 0.29%
Three Months ended Nine Months ended
June 30, June 30,
2002 2001 2002 2001
Selected Financial
Ratios & Other Data
(annualized):
Return on average
assets 1.32% 0.70% 1.21% 0.63%
Return on average
equity 17.23% 9.73% 15.85% 8.87%
Net interest rate
spread during period 3.19% 1.89% 2.90% 1.80%
Net interest margin 3.52% 2.37% 3.28% 2.27%
Net interest income
to non-interest
expense 208.08% 160.26% 191.49% 149.93%
Operating expenses
to average assets 1.66% 1.45% 1.67% 1.49%
Efficiency ratio 43.14% 55.58% 45.49% 59.19%
Basic earnings per
share (A) $0.72 $0.36 $1.97 $0.99
Diluted earnings
per share (A) $0.69 $0.34 $1.89 $0.95
(A) Adjusted for the February 28, 2002 3 for 2 stock split which was
effected in the form of a stock dividend.
SOURCE Fidelity Bancorp, Inc.
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CONTACT:
Raymond S. Stolarczyk, Chairman & CEO, Thomas
E. Bentel, President & COO, or Elizabeth A. Doolan, Sr. Vice
President & CFO, all of Fidelity Bancorp, Inc., +1-773-736-4414
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