CHICAGO, Oct. 20 /PRNewswire/ -- Fidelity Bancorp, Inc. (Nasdaq: FBCI),
the holding company for Fidelity Federal Savings Bank, today reported record
earnings for the fiscal year ended September 30, 1997. Net income was $3.9
million, or $1.38 per fully diluted share. Compared with 1996 results, which
included a one-time, $1.6 million pre-tax charge to recapitalize the Savings
Association Insurance Fund (SAIF), net income for 1997 was up $1.8 million, or
84.2 percent from $2.1 million in 1996.
Without the SAIF special assessment recorded in the fourth quarter of
1996, the company's net income increased $700,000, or 21.9 percent, from $3.2
million. Earnings per fully diluted share, without the one-time charge,
increased $0.32, or 30.2 percent, from $1.06 in 1996.
The company also reported that its board of directors declared a quarterly
dividend of $0.08 per share, payable on November 14, 1997 to shareholders of
record as of October 31, 1997.
For the fourth quarter ended September 30, 1997, the company's reported
net income was $1.1 million and earnings per fully diluted share was $0.38,
compared with a $209,000 net loss, or ($0.07) per share for the same period in
1996.
The increase in 1997 core earnings was primarily the result of higher
interest income. Income from loans receivable was $28.5 million for the year
ended September 30, 1997, a 19.1 percent increase from $23.9 million reported
in 1996. An increase in non-interest income also contributed to 1997
earnings. Sales of annuities and insurance helped boost non-interest income
15.3 percent to $1.1 million from $957,000 in 1996. A decrease in non-
interest expense, due to a reduction in Federal deposit insurance premiums,
also contributed to higher earnings.
"It was a good year for Fidelity," said Raymond S. Stolarczyk, chairman
and chief executive. "When you look at our year, income from operations once
again demonstrates that our strategy is working. Our primary business --
mortgage lending and serving retail deposit customers -- forms the core of our
record earnings."
Loan and Deposit Growth
Both loans and deposits were up significantly for the year. Loans
receivable, net of allowance for loan losses, were $388.3 million, up $34.0
million at September 30, 1997, or 9.6 percent. During the year, $97.8 million
in new loans were closed, funded by loan repayments and deposit inflows.
Deposits increased $20.5 million, or 6.8 percent, to $323.4 million at
September 30, 1997.
"Given the highly competitive environment for loans and deposits, I'm
pleased with our growth for the year," said Thomas E. Bentel, president and
chief operating officer. "Most of the increase in our loans receivable came
from 1-4 family home purchases. However, we also closed $16.0 million of
higher-yielding, multi-family apartment loans, a specialty of ours, and $6.8
million in equity loans. Of the new deposit growth, 63.6 percent was in
lower-cost transaction accounts, a stable funding source. And despite a
relatively flat yield curve and promotional pricing on certificates of
deposits early in the year, we closed the year with our net interest margin at
3.03 percent compared to 3.23 percent in 1996."
Bennett Funding Group Leases
Under the terms of a settlement agreement reached between the bank and the
Bennett Bankruptcy Trustee in August 1997, the bank expects to recover $1.5
million, the entire carrying amount of the Bennett leases due the bank. The
bank received post-bankruptcy lease receipts totaling $1.1 million at
settlement. Repayment of the balance of $408,000 in lease receivables at
September 30, 1997, is expected from future lease payments. The settlement
also ended all outstanding litigation. According to Board policy, the
substandard classification will remain on all Bennett lease receivables.
Asset Quality
Primarily as a result of the settlement of the Bennett leases, the bank's
allowance for loan losses decreased to $460,000 at September 30, 1997, from
$810,000 in 1996. Non-performing assets fell to $2.0 million from $3.2
million in 1996. The bank's asset quality ratios showed improvement, as the
ratio of non-performing assets to total assets declined to 0.41 percent at
September 30, 1997 from 0.67 percent for the same period in 1996.
Operating Ratios
The company continued to make improvements in productivity in the fourth
quarter and for the year. For the quarter ended September 30, 1997, the ratio
of operating expenses to average assets was 1.78 percent. The ratio for the
year was 1.91 percent, compared with 2.10 percent for 1996 (without the SAIF
assessment.) Return on equity also showed continued improvement: For the
quarter ended September 30, 1997, ROE was 8.3 percent. For 1997, ROE
increased to 7.8 percent from 6.0 percent in 1996 (without the SAIF
assessment). The company's book value per share was $18.66 at September 30,
1997, compared with $17.04 in 1996, a 9.5 percent increase.
"We believe that the year's increases in book value, earnings per share
and return on equity continue to demonstrate Fidelity's commitment to
returning value to our shareholders," Stolarczyk said.
Annual Meeting Announced
The company also announced the date of its annual meeting of shareholders.
The meeting will be held at 10:00 a.m., Wednesday, January 28, 1998 at the
company's headquarters, 5455 W. Belmont Ave., Chicago.
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 INVEST Financial Corporation. Fidelity's stock is
traded on the Nasdaq National Market System under the symbol FBCI.
Fidelity Bancorp Inc.'s news releases are available through PR Newswire's
Company News On-Call fax service. For a menu of Fidelity Bancorp's news
releases, or to receive a specific release, call (800) 758-5804, ext. 107861,
or visit http://www.prnewswire.com on the Internet. The company's SEC filings are
available electronically on the Internet at http://www.sec.gov/cgi-bin/srch-
edgar?0000912219.
FIDELITY BANCORP and SUBSIDIARY
Consolidated Statements of Financial Condition
Dollars in thousands
September 30, 1997 and 1996
Assets 1997 1996
(unaudited)
Cash and due from banks $436 3,848
Interest-bearing deposits 2,314 225
Federal funds sold 100 200
Investment in dollar-denominated
mutual funds, at fair value 3,154 3,146
FHLB of Chicago stock 5,700 5,795
Mortgage-backed securities,
at amortized cost (approximate fair
value of $17,124 and $21,766 at
September, 30, 1997 and 1996) 16,875 21,673
Investment securities available
for sale, at fair value 72,525 78,104
Loans receivable, net of
allowance for loan losses of
$460 and $810
at September 30, 1997 and 1996 388,262 354,255
Accrued interest receivable 3,445 3,199
Real estate in foreclosure 215 97
Premises and equipment 3,593 3,780
Deposit base intangible 107 158
Other assets 1,136 1,382
TOTAL $497,862 475,862
Liabilities and Stockholders' Equity
Liabilities
Deposits 323,443 302,934
Borrowed fund 113,400 115,300
Advance payments by borrowers
for taxes and insurance 2,197 1,953
Other liabilities 6,657 6,847
Total liabilities 445,697 427,034
Stockholders' Equity
Preferred stock, $.01 par value;
authorized 2,500,000 shares;
none outstanding - -
Common stock, $.01 par value;
authorized 8,000,000 shares;
issued 3,782,350 and outstanding
2,794,978 and 2,866,108 shares
at September 30, 1997 and 1996,
respectively 38 38
Additional paid-in capital 37,494 37,079
Retained earnings, substantially
restricted 30,959 27,851
Treasury stock, at cost
(987,372 and 916,242 shares
at September 30, 1997 and 1996,
respectively) (13,855) (12,619)
Common stock acquired by Employee
Stock Ownership Plan (1,662) (2,078)
Common stock acquired by
Bank Recognition and
Retention Plans (471) (708)
Unrealized loss on investment securities
available for sale, less
applicable taxes (338) (735)
Total stockholders' equity 52,165 48,828
TOTALS $497,862 475,862
FIDELITY BANCORP and SUBSIDIARY
Consolidated Statements of Earnings
Dollars in thousands (except for earnings per share)
Three months Year ended
September 30, September 30,
1997 1996 1997 1996
(unaudited) (unaudited)
Interest Income:
Loans receivable $7,308 6,648 28,468 23,907
Mortgage-backed securities 312 393 1,387 1,703
Interest earning deposits 25 7 60 60
Federal funds sold 8 2 19 38
Investment securities 1,388 1,510 5,813 5,772
Investment in mutual funds 44 41 168 74
9,085 8,601 35,915 31,554
Interest Expense:
Deposits 4,109 3,476 15,929 13,941
Borrowed funds 1,400 1,579 5,541 4,188
TOTALS 5,509 5,055 21,470 18,129
Net interest income
before provision for
loan losses 3,576 3,546 14,445 13,425
Provision for loan losses 10 320 64 410
Net interest income after
provision for
loan losses 3,566 3,226 14,381 13,015
Non-Interest Income:
Fees and commissions 54 96 341 379
Insurance and
annuity commissions 218 118 700 519
Other 17 20 62 59
TOTAL 289 234 1,103 957
Non-Interest Expense:
General and administrative expenses:
Salaries and employee
benefits 1,350 1,244 5,366 4,878
Office occupancy
and equipment 300 311 1,203 1,208
Data Processing 125 113 482 449
Advertising and promotions 47 88 515 421
Federal deposit insurance
premiums 58 1,795 325 2,294
Other 312 362 1,346 1,284
Total general and
administrative expenses 2,192 3,913 9,237 10,534
Amortization of intangible 12 13 51 61
2,204 3,926 9,288 10,595
Income (loss) before
income taxes 1,651 (466) 6,196 3,377
Income tax expense (benefit) 569 (257) 2,251 1,235
Net income (loss) $1,082 (209) 3,945 2,142
Earnings per
share - primary $0.38 $(0.07) $1.40 $0.72
Earnings per
share - fully diluted $0.38 $(0.07) $1.38 $0.72
FIDELITY BANCORP and SUBSIDIARY
Selected Financial Highlights
Dollars in thousands (except for book value and earnings per share)
September 30,
1997 1996
(unaudited)
Selected Financial Highlights:
Total assets $497,862 475,862
Interest-earning assets 488,930 463,398
Loans receivable, net (1) 388,262 354,255
Deposits 323,443 302,934
Borrowed funds 113,400 115,300
Non-performing assets (2) 2,023 3,183
Non-performing loans (2) 1,808 3,086
Allowance for loan losses 460 810 (3)
Stockholders' equity 52,165 48,828
Book value per share 18.66 17.04
Shares outstanding -
actual number 2,794,978 2,866,108
Asset Quality Ratios:
Non-performing loans to
loans receivable, net (2) 0.47% 0.87%
Non-performing loans to
total assets (2) 0.36% 0.65%
Non-performing assets
to total assets (2) 0.41% 0.67%
Allowance for loan losses to
total non-performing loans (2) 25.4% 26.3%
Allowance for loan losses
to loans receivable, net (3) 0.12% 0.23% (3)
Three Months Ended
September 30, Year Ended September 30,
1997 1996 1997 1996
(unaudited) (unaudited)
(annualized) Adjusted
(4)
ACTUAL ACTUAL w/o SAIF
Selected Operating Activities:
Return on average assets 0.87% (0.18)% 0.81% 0.50% 0.74%
Return on
average equity 8.3% (1.7)% 7.8% 4.1% 6.0%
Net interest rate
spread during
period 2.33% 2.53% 2.45% 2.57% 2.57%
Net interest
margin 2.96% 3.12% 3.03% 3.23% 3.23%
Net interest income
to operating
expense 162% 90% 156% 127% 150%
Operating expenses to
average assets 1.78% 3.37% 1.91% 2.48% 2.10%
Primary earnings
per share $0.38 ($0.07) $1.40 $0.72 $1.06
Fully diluted earnings
per share $0.38 ($0.07) $1.38 $0.72 $1.06
(1) The loans receivable portfolio includes $0.4 million and $2.0
million of Bennett Funding Group commercial equipment leases at
September 30, 1997 and 1996, respectively.
(2) The non-performing loans include Bennett Funding Group commercial
equipment leases.
(3) Allowance for loan losses at September 30, 1996 includes a specific
reserve of $406,400 for Bennett Funding Group commercial equipment
leases.
(4) The adjusted annual ratios reflect the Company's results excludes the
SAIF special assessment explained earlier in this release.
SOURCE Fidelity BanCorp, Inc.
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CONTACT:
Raymond S. Stolarczyk, Chairman & CEO, or
Thomas E. Bentel, President & COO, or Jim Kinney, Sr. VP & CFO,
of Fidelity, 773-736-4414, or fax, 773-736-6471
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