CHICAGO, Oct. 21 /PRNewswire/ -- Fidelity Bancorp, Inc.
(Nasdaq-NNM: FBCI), the holding company for Fidelity Federal Savings Bank,
today reported that net income, excluding a one-time charge related to the
bank's deposit insurance premium, was $3.2 million, or $1.06 per fully diluted
share. This compares with $3.1 million, or $0.93 per fully diluted share for
the prior year, a 14.0 percent increase in earnings per share. Including a
one-time special assessment charge, earnings for the year ended September 30,
1996 were $2.1 million, or $0.72 per fully diluted share.
The one-time special assessment charge is the result of legislation passed
on September 30, 1996, regarding the Savings Association Insurance Fund
(SAIF). To cover the special assessment called for by the legislation, the
bank recorded a pre-tax charge of $1.6 million. The company also reported
that its board of directors declared a quarterly dividend of $0.06 per share,
payable on November 15, 1996 to shareholders of record as of October 31, 1996.
For the fourth quarter of the fiscal year, the company reported a net loss
of $209,000, or $0.07 per fully diluted share, compared with net income of
$682,000 or $0.21 per fully diluted share for the same period one year ago.
The decline in earnings for the fourth quarter is also attributed to the
insurance fund special charge taken in the quarter.
Interest income for the year ended September 30, 1996 was $31.6 million,
compared with $26.2 million the prior year. The 20.6 percent increase in
interest income was due primarily to an increase in loans receivable,
including a larger number of multi-family residential loans. Interest expense
for the year was $18.1 million, compared with $13.8 million in 1995, the
result of deposit growth and an increase in borrowed funds. Net interest
income before provision for loan losses was $13.4 million, an increase of
$1.0 million, or 8.1 percent.
"Fidelity had a very strong year, despite the impact of the special
assessment. In terms of recurring items, we've shown good growth and
increased income," said Raymond S. Stolarczyk, chairman and chief executive
officer. "We're pleased to have the issue of the special assessment behind us
and we will benefit in the future from a reduction in the insurance premium."
Effective January 1, 1997, the SAIF insurance premium charges paid by the
bank are expected to drop from the present level of 0.23 percent to
0.0645 percent of insured deposits.
Growth in Loans and Deposits
Fidelity's asset growth continued at a strong pace. At September 30, 1996
total assets were $475.9 million, compared with $393.7 million in 1995. The
growth in assets was primarily the result of increased loan originations,
which totaled $139.6 million, up 79.2 percent from the prior year. The
increase in loan originations was due to the expansion of the bank's third
party originator (TPO) network. The TPO network gives Fidelity the ability to
keep overhead expenses in check without constraining the bank's ability to
grow loan volumes.
Deposits also grew, exceeding the $300 million mark for the first time.
Deposits totaled $302.9 million at September 30, 1996, up 9.8 percent from the
previous year. Growth in deposits for the year was achieved as the result of
new household acquisition at all offices. A successful third quarter campaign
aimed at retaining maturing certificates of deposit was also an important
factor in deposit growth.
Asset Quality
The loan and asset portfolios, exclusive of the commercial equipment
leases described below, continue to exhibit very low delinquency statistics.
Specifically, non-performing mortgages and consumer loans amounted to
$1.1 million or 0.22 percent of total assets, compared to $617,000 at
September 30, 1995. Total non-performing assets, including commercial leases,
were $3.2 million or 0.67 percent of total assets at September 30, 1996.
The bank's $2.0 million of commercial equipment leases originated by the
Bennett Funding Group continue to be non-performing as reported last quarter.
Litigation is continuing in which the bank is asserting its claimed security
interest in the leases, which claim is contested by the Bankruptcy Trustee.
The opinion of the bank's bankruptcy counsel is that the bank's position
should ultimately prevail, although there can be no assurance of a favorable
result. The bankruptcy judge is expected to rule on the matter before the end
of this calendar year.
Based on a review of the estimated realizable value of the leases the bank
has added $305,000 to its valuation allowance this quarter, bringing the total
valuation allowance for the leases to $406,000. At this allowance level the
leases are carried on the books at 80 cents on the dollar. Any recovery by
the bank of less than 80 cents on the dollar will cause additional losses.
Stock Repurchase
On August 8, 1996, the company received regulatory approval from the
Office of Thrift Supervision to begin its sixth stock repurchase program,
commencing August 14, 1996. This program allows for the repurchase of up to
5 percent, or 146,530, of the company's outstanding shares. As of
September 30, 1996, the company purchased 64,500 shares at an average price of
$16.996. The company's repurchase strategy is consistent with its commitment
to enhancing shareholder value.
"The stock repurchase program, an increase in the company's book value
from $16.41 to $17.04 and our dividend program have enabled us to deliver real
value to our investors," 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 29, 1997 at the
company's headquarters at 5455 W. Belmont Avenue in 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 under the symbol FBCI.
FIDELITY BANCORP and SUBSIDIARY
Consolidated Statements of Financial Condition
(Dollars in thousands)
September 30, 1996 and 1995
Assets 1996 1995
(unaudited)
Cash and due from banks $3,848 2,649
Interest-bearing deposits 225 1,266
Federal funds sold 200 200
Investment in mutual funds, at fair value 3,146 227
FHLB of Chicago stock 5,795 3,000
Mortgage-backed securities, at amortized cost
(approximate market value of $21,766 and
$26,769 at September, 30, 1996 and 1995) 21,673 26,484
Investment securities available for sale,
at fair value 78,104 84,579
Loans receivable, net of allowance for
loan losses of $810 and $403 at
September 30, 1996 and 1995 354,255 266,735
Accrued interest receivable 3,199 2,910
Real estate in foreclosure 97 --
Premises and equipment 3,780 3,988
Deposit base intangible 158 219
Other assets 1,382 1,407
Total $475,862 393,664
Liabilities and Stockholders' Equity
Liabilities
Deposits 302,934 275,993
Borrowed funds 115,300 54,032
Advanced payments by borrowers for taxes
and insurance 1,953 4,908
Other liabilities 6,847 4,939
Total liabilities 427,034 339,872
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 2,866,108 and
3,278,894 shares at September 30, 1996
and 1995, respectively 38 38
Additional paid-in capital 37,079 36,795
Retained earnings, substantially restricted 27,851 26,449
Treasury stock, at cost (916,242 and
503,456 shares at September 30, 1996 and
1995, respectively) (12,619) (5,978)
Common stock acquired by Employee Stock
Ownership Plan (2,078) (2,494)
Common stock acquired by Bank Recognition
and Retention Plans (708) (963)
Unrealized loss on investment securities
available for sale, less applicable taxes (735) (55)
Total stockholders' equity 48,828 53,792
Total Liabilities and Stockholders' Equity $475,862 393,664
FIDELITY BANCORP and SUBSIDIARY
Consolidated Statements of Earnings
(Dollars in thousands)
Three months Year ended
ended September 30, September 30,
1996 1995 1996 1995
(unaudited) (unaudited)
Interest Income:
Loans receivable $6,648 5,182 23,907 19,329
Mortgage-backed securities 393 473 1,703 2,302
Interest earning deposits 7 10 60 54
Federal funds sold 2 3 38 24
Investment securities 1,510 1,429 5,772 4,240
Investment in mutual funds 41 4 74 220
Total 8,601 7,101 31,554 26,169
Interest Expense:
Deposits 3,476 3,251 13,941 10,966
Borrowed funds 1,579 811 4,188 2,786
Total 5,055 4,062 18,129 13,752
Net interest income before
provision for loan losses 3,546 3,039 13,425 12,417
Provision for loan losses 320 -- 410 192
Net interest income after
provision for loan losses 3,226 3,039 13,015 12,225
Non-Interest Income:
Gain on sale of assets available
for sale -- -- -- 274
Fees and commissions 96 103 379 398
Insurance and annuity commissions 118 102 519 519
Other 20 11 59 38
Total 234 216 957 1,229
Non-Interest Expense:
General and administrative expenses:
Salaries and employee benefits 1,244 1,185 4,878 4,570
Office occupancy and equipment 311 318 1,208 1,220
Data Processing 113 104 449 407
Advertising and promotions 88 84 421 476
Federal deposit insurance
premiums 1,795 140 2,294 564
Other 362 291 1,294 1,028
Total general and administrative
expenses 3,913 2,122 10,544 8,265
Amortization of intangible 13 18 61 72
Recapture of credit enhancement
losses -- -- (10) --
Total 3,926 2,140 10,595 8,337
Income (loss) before income taxes (466) 1,115 3,377 5,117
Income tax expense (benefit) (257) 433 1,235 2,033
Net income (loss) $(209) $682 2,142 3,084
Earnings per share - primary $(0.07) $0.21 $0.72 $0.94
Earnings per share - fully
diluted $(0.07) $0.21 $0.72 $0.93
FIDELITY BANCORP and SUBSIDIARY
Selected Financial Highlights
(Dollars in thousands, except for book value and earnings per share)
September 30,
1996 1995
(unaudited)
Selected Financial Highlights:
Total assets $475,862 393,664
Interest-earning assets 463,398 382,491
Loans receivable, net (B) 354,255 266,735
Deposits 302,934 275,993
Borrowed funds 115,300 54,032
Non-performing assets 3,183(C) 617(A)
Non-performing loans 3,086(C) 617(A)
Allowance for loan losses 810 403
Stockholders' equity 48,828 53,792
Book value per share 17.04 16.41
Shares outstanding - actual number 2,866,108 3,278,894
Asset Quality Ratios:
Non-performing loans to loans
receivable, net 0.87%(C) 0.23%
Non-performing loans to total assets 0.65%(C) 0.16%
Non-performing assets to total assets 0.67%(C) 0.16%
Allowance for loan losses to total
non-performing loans 26.3%(C) 65.3%
Allowance for loan losses to loans
receivable, net 0.23% 0.15%
Three Months Ended
September 30, Year Ended September 30,
1996 1995 1996 1995
(unaudited) (unaudited)
Adjusted
(D)
(annualized) ACTUAL w/o SAIF ACTUAL
Selected Operating Activities:
Return on average assets (0.18)% 0.70% 0.50% 0.74% 0.85%
Return on average equity (1.7)% 5.0% 4.1% 6.0% 5.6%
Net interest rate spread
during period 2.53% 2.42% 2.57% 2.57% 2.80%
Net interest margin 3.12% 3.20% 3.23% 3.23% 3.52%
Net interest income to
operating expense 90% 142% 127% 150% 149%
Operating expenses to
average assets 3.37% 2.20% 2.48% 2.10% 2.30%
Primary earnings per share ($0.07) $0.21 $0.72 $1.06 $0.94
Fully diluted earnings
per share ($0.07) $0.21 $0.72 $1.06 $0.93
(A) September 30, 1995 non-performing loans have been restated to conform
with industry practices. These figures include all loans 90 days or more
delinquent.
(B) The loans receivable portfolio includes $2.0 million and $2.4 million
of Bennett Funding Group commercial equipment leases at September 30, 1996 and
1995, respectively.
(C) The non-performing loans include $2.0 million of Bennett Funding
Group commercial equipment leases.
(D) 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 Bancorp, 773-736-4414
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