United States Securities and Exchange Commission
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PUSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended December 31, 2004
-----------------
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from to
-------------------- --------------------
Commission file number 0-22288
-------
Fidelity Bancorp, Inc.
----------------------
(Exact name of registrant as specified in its charter)
Pennsylvania 25-1705405
------------ ----------
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization
1009 Perry Highway, Pittsburgh, Pennsylvania, 15237
---------------------------------------------------
(Address of principal executive offices)
412-367-3300
------------
(Registrant's telephone number, including area code)
Not Applicable
- --------------------------------------------------------------------------------
(Former name, former address and former fiscal year, if
changed since last report)
Indicate by check mark whether the issuer: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No
----- -----
Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act). Yes No X
----- -----
APPLICABLE ONLY TO CORPORATE ISSUERS
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date: 2,650,039 shares, par value
---------------------------
$0.01, at January 31, 2005
- --------------------------
FIDELITY BANCORP, INC. AND SUBSIDIARIES
Index
Part I - Financial Information Page
- ------------------------------ ----
Item 1. Financial Statements (Unaudited)
Consolidated Statements of Financial Condition as of 1
December 31, 2004 and September 30, 2004
Consolidated Statements of Income for the Three Months 2
Ended December 31, 2004 and 2003
Consolidated Statements of Cash Flows for the Three Months 3-4
Ended December 31, 2004 and 2003
Consolidated Statements of Changes in Stockholders' 5
Equity for the Three Months Ended December 31, 2004 and 2003
Notes to Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of Financial Condition 13
and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk 20
Item 4. Controls and Procedures 21
Part II - Other Information
- ---------------------------
Item l. Legal Proceedings 21
Item 2. Unregistered Sales of Equity Securities, Use of Proceeds 22
and Issuer Purchases of Equity Securities
Item 3. Defaults Upon Senior Securities 22
Item 4. Submission of Matters to a Vote of Security Holders 22
Item 5. Other Information 22
Item 6. Exhibits 23-24
Signatures 25
Item 1. Financial Statements
FIDELITY BANCORP, INC. AND SUBSIDIARIES
Consolidated Statements of Financial Condition (Unaudited)
----------------------------------------------------------
(in thousands except share data)
December 31, September 30,
Assets 2004 2004
------ ---- ----
Cash and due from banks $ 8,125 $ 8,212
Interest-bearing demand deposits with other institutions 320 619
--------- ---------
Cash and Cash Equivalents 8,445 8,831
Securities available-for-sale 190,152 186,112
(book value of $188,775 and $184,301)
Securities held-to-maturity 117,012 109,334
(fair value of $117,807 and $110,413)
Loans held for sale -- 116
Loans receivable, net of allowance $2,548 and $2,609 297,766 290,389
Foreclosed real estate, net 1,267 1,517
Restricted investments in bank stock, at cost 11,942 11,156
Office premises and equipment, net 5,123 5,210
Accrued interest receivable 3,192 3,081
Other assets 11,785 11,981
--------- ---------
Total Assets $ 646,684 $ 627,727
========= =========
Liabilities and Stockholders' Equity
------------------------------------
Liabilities:
Deposits:
Non-interest bearing $ 29,799 $ 30,106
Interest bearing 328,675 329,666
--------- ---------
Total Deposits 358,474 359,772
Short-term borrowings 78,657 64,106
Subordinated Debt 10,310 10,310
Securities sold under agreement to repurchase 5,569 5,118
Advance payments by borrowers for taxes and insurance 2,225 1,129
Other liabilities 2,692 2,908
Long-term debt 147,206 142,307
--------- ---------
Total Liabilities 605,133 585,650
--------- ---------
Stockholders' equity:
Common stock, $0.01 par value per share,
10,000,000 shares authorized; 3,177,660
and 3,153,617 shares issued, respectively 32 32
Paid-in capital 36,140 35,798
Retained earnings 14,279 13,595
Accumulated other comprehensive income 908 1,195
Treasury stock, at cost - 534,505 and 480,295 shares (9,808) (8,543)
--------- ---------
Total Stockholders' Equity 41,551 42,077
--------- ---------
Total Liabilities and Stockholders' Equity $ 646,684 $ 627,727
========= =========
See accompanying notes to unaudited consolidated financial statements.
-1-
FIDELITY BANCORP, INC. AND SUBSIDIARIES
Consolidated Statements of Income (Unaudited)
---------------------------------------------
(in thousands, except per share data)
Three Months Ended
December 31,
------------
2004 2003
---- ----
Interest income:
Loans $4,442 $4,331
Mortgage-backed securities 1,351 926
Investment securities - taxable 1,340 1,310
Investment securities - tax-exempt 474 613
Other 1 1
------ ------
Total interest income 7,608 7,181
------ ------
Interest expense:
Deposits 1,843 2,041
Short-term borrowings 420 158
Long-term debt 1,744 1,820
Subordinated debt 145 122
------ ------
Total interest expense 4,152 4,141
------ ------
Net interest income 3,456 3,040
Provision for loan losses 175 50
------ ------
Net interest income after provision for loan losses 3,281 2,990
------ ------
Other income:
Loan service charges and fees 97 97
Realized gain on sales of securities, net 82 89
Gain on sales of loans 5 17
Deposit service charges and fees 356 355
Other 301 311
------ ------
Total other income 841 869
------ ------
Operating expenses:
Compensation and benefits 1,823 1,765
Office occupancy and equipment expense 257 233
Depreciation and amortization 186 197
Net loss on foreclosed real estate 19 2
Amortization of intangible assets 13 14
Other 578 576
------ ------
Total operating expenses 2,876 2,787
------ ------
Income before income tax provision 1,246 1,072
Income tax provision 241 220
------ ------
Net income $1,005 $ 852
====== ======
Basic earnings per common share $ .38 $ .32
====== ======
Diluted earnings per common share $ .36 $ .30
====== ======
Dividends per common share $ .12 $ .109
====== ======
See accompanying notes to unaudited consolidated financial statements
-2-
FIDELITY BANCORP, INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows (Unaudited)
-------------------------------------------------
(in thousands)
Three Months Ended December 31,
2004 2003
---- ----
Operating Activities:
Net income $ 1,005 $ 852
Adjustments to reconcile net income to net cash provided by
operating activities:
Provision for loan losses 175 50
Loss on foreclosed real estate 19 2
Provision for depreciation and amortization 186 197
Deferred loan fee amortization (52) (55)
Amortization of investment and mortgage-backed securities
discounts/premiums, net 208 533
Amortization of intangibles 13 14
Net gain on sale of securities (82) (89)
Net gain on sale of loans (5) (17)
Origination of loans held-for-sale (191) (190)
Proceeds from sale of loans held-for-sale 312 423
(Increase)/Decrease in interest receivable (111) 13
Decrease in prepaid income taxes 183 24
Decrease in interest payable (20) (226)
Increase in cash surrender value of life insurance policies (51) (49)
Contribution to ESOP (235) (103)
Other changes, net 160 809
------- -------
Net cash provided by operating activities 1,514 2,188
------- -------
Investing Activities:
Proceeds from sales of securities available-for-sale 441 1,628
Proceeds from maturities and principal repayments of
securities available-for-sale 11,877 13,251
Purchases of securities available-for-sale (16,697) (14,342)
Purchases of securities held-to-maturity (12,040) (10,023)
Proceeds from maturities and principal repayments of
securities held-to-maturity 4,232 7,854
Net increase in loans (7,500) (6,290)
Proceeds from sale of foreclosed real estate 274 9
Net purchases of FHLB stock (786) (122)
Proceeds from sale of office premises and equipment -- 30
Additions to office premises and equipment (98) (47)
------- -------
Net cash used in investing activities (20,297) (8,052)
------- -------
Continued on page 4.
-3-
FIDELITY BANCORP, INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows (Unaudited) (Cont'd.)
-----------------------------------------------------------
(in thousands)
Three Months Ended December 31,
2004 2003
---- ----
Financing Activities:
Net (decrease)/increase in deposits (1,298) 1,012
Increase/(decrease) in reverse repurchase agreements 451 (908)
Net increase in short-term borrowings 14,551 18,282
Proceeds from long-term borrowings 10,000 --
Repayments of long-term borrowings (5,101) (10,100)
Increase in advance payments by borrowers for taxes and insurance 1,096 1,203
Cash dividends paid (321) (291)
Stock options exercised 247 140
Proceeds from sale of stock through Dividend Reinvestment Plan 37 32
Contribution of stock to Employee Stock Ownership Plan -- 117
Purchase of treasury stock (1,265) (246)
-------- --------
Net cash provided by financing activities 18,397 9,241
-------- --------
(Decrease) increase in cash and cash equivalents (386) 3,377
Cash and cash equivalents at beginning of period 8,831 7,992
-------- --------
Cash and cash equivalents at end of period
$ 8,445 $ 11,369
======== ========
Supplemental Disclosure of Cash Flow Information
Cash paid during the period for:
Interest on deposits and other borrowings $ 4,172 $ 4,356
Income taxes $ -- $ --
-------- --------
Supplemental Schedule of Noncash Investing and Financing Activities
Transfer of loans to foreclosed real estate $ -- $ 15
-------- --------
See accompanying notes to unaudited consolidated financial statements.
-4-
FIDELITY BANCORP, INC. AND SUBSIDIARIES
Consolidated Statements of Changes in Stockholders' Equity (Unaudited)
(in thousands, except share data)
Accumulated
Other
Additional Comprehensive
Common Paid-in Treasury Retained Income
Stock Capital Stock Earnings Net of Tax Total
===============================================================================================================================
Balance at September 30, 2003 $ 28 $ 28,960 $ (7,192) $ 16,388 $ 2,011 $ 40,195
Comprehensive income:
Net income 852 852
Other comprehensive income,
net of tax of ($18) (35) (35)
Reclassification adjustment,
net of tax of ($30) (59) (59)
------ -------- --------- -------- ------- --------
Total comprehensive income -- -- -- 852 (94) 758
Cash dividends declared (291) (291)
Treasury stock purchased -
10,000 shares (246) (246)
Contribution of stock to ESOP
(5,000 shares) (6) 123 117
Sale of stock through Dividend
Reinvestment Plan 32 32
Stock options exercised -- 140 140
------ -------- --------- -------- ------- --------
Balance at December 31, 2003 $ 28 $ 29,126 $ (7,315) $ 16,949 $ 1,917 $ 40,705
====== ======== ========= ======== ======= ========
Balance at September 30, 2004 $ 32 $ 35,798 $ (8,543) $ 13,595 $ 1,195 $ 42,077
Comprehensive income:
Net income 1,005 1,005
Other comprehensive income,
net of tax of ($121) (233) (233)
Reclassification adjustment,
net of tax of ($28) (54) (54)
------ -------- --------- -------- ------- --------
Total comprehensive income -- -- -- 1,005 (287) 718
Cash dividends declared (321) (321)
Tax benefit realized on stock options
exercised 58 58
Treasury stock purchased -
54,210 shares (1,265) (1,265)
Sale of stock through Dividend
Reinvestment Plan 37 37
Stock options exercised 247 247
------ -------- --------- -------- ------- --------
Balance at December 31, 2004 $ 32 $ 36,140 $ (9,808) $ 14,279 $ 908 $ 41,551
====== ======== ========= ======== ======= ========
See accompanying notes to unaudited consolidated financial statements.
-5-
FIDELITY BANCORP, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements - (Unaudited)
December 31, 2004
(1) Consolidation
-------------
The consolidated financial statements contained herein for Fidelity Bancorp,
Inc. (the "Company") include the accounts of Fidelity Bancorp, Inc. and its
wholly-owned subsidiary, Fidelity Bank, PaSB (the "Bank"). All inter-company
balances and transactions have been eliminated.
(2) Basis of Presentation
---------------------
The accompanying consolidated financial statements were prepared in accordance
with instructions to Form 10-Q, and therefore, do not include information or
footnotes necessary for a complete presentation of financial position, results
of operations and cash flows in conformity with generally accepted accounting
principles in the United States. However, all normal recurring adjustments,
which, in the opinion of management, are necessary for a fair presentation of
the financial statements, have been included. These financial statements should
be read in conjunction with the audited financial statements and the
accompanying notes thereto included in the Company's Annual Report for the
fiscal year ended September 30, 2004. The results for the three month period
ended December 31, 2004 are not necessarily indicative of the results that may
be expected for the fiscal year ending September 30, 2005 or any future interim
period.
(3) New Accounting Standards
------------------------
In January 2003, the Financial Accounting Standards Board (FASB) issued FASB
Interpretation No. 46, "Consolidation of Variable Interest Entities, an
Interpretation of ARB No. 51". FIN 46 was revised in December 2003. This
interpretation provides new guidance for the consolidation of variable interest
entities (VIEs) and requires such entities to be consolidated by their primary
beneficiaries if the entities do not effectively disperse risk among parties
involved. The interpretation also adds disclosure requirements for investors
that are involved with unconsolidated VIEs. The disclosure requirements apply to
all financial statements issued after December 31, 2003. The consolidation
requirements apply to companies that have interests in special-purpose entities
for periods ending after December 15, 2003.
FIN 46 required Fidelity Bancorp, Inc. to deconsolidate its investment in FB
Statutory Trust II (the Trust) on the March 15, 2004, effective date. As a
result, the Company's Consolidated Statements of Financial Condition include
junior subordinated debt ("Subordinated Debt") and the related interest expense
is included as a component of interest expense on Fidelity's Consolidated
Statements of Income. Prior to the adoption of FIN 46, the Company's
Consolidated Statements of Financial Condition reported the "Guaranteed
Preferred Beneficial Interest in Company's Debentures" in its Statement of
Condition, which represented the trust preferred securities issued by the Trust.
The deconsolidation of subsidiary trusts of bank holding companies formed in
connection with the issuance of trust preferred securities, like the Trust,
appears to be an unintended consequence of FIN 46. It is currently unknown if,
or when, the FASB will address this issue. In July 2003, the Board of Governors
of the Federal Reserve System issued a supervisory letter instructing bank
holding companies to continue to include the trust preferred securities in their
Tier 1 capital for regulatory capital purposes until notice is given to the
contrary. The Federal Reserve has proposed regulations that would allow bank
holding companies such as the Company to continue to count trust preferred
securities up to 25% of Tier 1 capital. The Company will continue to meet its
regulatory capital requirements if the proposal is adopted in its current form.
-6-
In December 2003, the Accounting Standards Executive Committee issued Statement
of Position 03-3 (SOP 03-3), "Accounting for Certain Loans or Debt Securities
Acquired in a Transfer." SOP 03-3 addresses accounting for differeneces between
contractual cash flows and cash flows expected to be collected from an
investor's initial investment in loans or debt securities acquired in a
transfer, including business combinations, if those differences are
attributable, at least in part, to dredit quality. SOP 03-3 is effective for
loans for debt securities acquired in fiscal years beginning after December 15,
2004. the Company intends to adopt the provisions of SOP 03-3 effective October
1, 2005, and does not expect the initial implementation to have a material
effect on the Company's consolidated financial statements.
In March 2004, the FASB's Emerging Issues Task Force (EITF) reached a consensus
on EITF Issue No., 03-1, "The Meaning of Other-Than-Temporary Impairment and Its
Application to Certain Investments" (EITF 03-1). EITF 03-1 provides guidance
regarding the meaning of other-than-temporary impairment and its application to
investments classified as either available-for-sale or held-to-maturity under
FASB Statement No. 115, "Accounting for Certain Investments in Debt and Equity
Securities," and to equity securities accounted for under the cost method.
Included in EITF 03-1 is guidance on how to account for impairments that are
solely due to interest rate changes, including changes resulting from increases
in sector credit spreads. This guidance was to become effective for reporting
periods beginning after June 15, 2004. However, on September 30, 2004, the FASB
issued a Staff Position that delays the effective date for the recognition and
measurement guidance of EITF 03-1 until additional clarifying guidance is
issued. We are not able to assess the impact of the adoption of EITF 03-1 until
final guidance is issued.
In March 2004, the SEC released Staff Accounting Bulletin (SAB) No. 105,
"Application of Accounting Principles to Loan Commitments." SAB 105 provides
guidance about the measurements of loan commitments recognized at fair value
under FASB Statement No. 133, "Accounting for Derivative Instruments and Hedging
Activities." SAB 105 also requires companies to disclose their accounting policy
for those loan commitments including methods and assumptions used to estimate
fair value and associated hedging strategies. SAB 105 is effective for all loan
commitments accounted for as derivatives that are entered into after March 31,
2004. The adoption of SAB 105 did not have a material effect on our consolidated
financial statements.
In December 2004, the FASB issued Statement No. 123R, "Share-Based Payment."
Statement No. 123R revised Statement No. 123, "Accounting for Stock-Based
Compensation," and supersedes APB Opinion No. 25, "Accounting for Stock Issued
to Employees," and its related implementation guidance. Statement No. 123R will
require compensation costs related to share-based payment transactions ot be
recognized in the financial statement (with limited exceptions). The amount of
compensation cost will be measured based on the grant-date fair value of the
equity or liability instruments issued. Compensation cost will be recognized
over the period that an employee provides service in exchange for the award.
This statement is effective as of the beginning of the first interim or annual
reporting period that begins after June 15, 2005. The Company is currently
evaluating the impact from this standard on its results of operations and
financial position.
-7-
(4) Stock Based Compensation
------------------------
At December 31, 2004, the Company had several stock-based employee and director
compensation plans, which are described in Note 13 in the Company's 2004 Annual
Report. All options granted under these plans have an exercise price equal to
the market value of the underlying common stock on the date of grant. The
Company applies APB Opinion No. 25, "Accounting for Stock Issued to Employees,"
and related interpretations. Accordingly, no compensation expense has been
recognized for its stock option plans. However, as required to be disclosed by
SFAS No. 148, the following table illustrates the pro forma effect on net income
and earnings per share if the fair value based method had been applied to the
Company's stock option plans (amounts in thousands, except per share data).
For the three months
ended December 31,
--------------------
2004 2003
-------- --------
Net income, as reported $ 1,005 $ 852
Add: Stock-based compensation expense included in
reported net income, net of tax -- --
Deduct: Compensation expense from stock options,
determined under fair value based method, net of tax (13) (9)
-------- --------
Pro forma net income $ 992 $ 843
======== ========
Earnings per share:
Basic - as reported $ .38 $ .32
Basic - pro forma $ .37 $ .32
Diluted - as reported $ .36 $ .30
Diluted - pro forma $ .35 $ .30
The Black-Scholes option pricing model requires the use of subjective
assumptions which can materially affect fair value estimates. Therefore, this
model does not necessarily provide a reliable single measure of the fair value
of the Company's stock options.
-8-
(5) Earnings Per Share
------------------
Basic earnings per share (EPS) excludes dilution and is computed by dividing
income available to common stockholders by the weighted average number of common
shares outstanding for the period. Diluted EPS reflects the potential dilution
that could occur if securities or other contracts to issue common stock were
exercised or converted into common stock or resulted in the issuance of common
stock that then shared in the earnings of the Company. All weighted average
share and per share amounts reflect the 10% stock dividends distributed on May
26, 2004 and May 28, 2003. The following table sets forth the computation of
basic and diluted earnings per share (amounts in thousands, except per share
data):
Three Months Ended
December 31,
2004 2003
------------------
Numerator:
Net Income $1,005 $ 852
------ ------
Denominator:
Denominator for basic earnings per
share - weighted average shares 2,666 2,670
Effect of dilutive securities:
Employee stock options 131 139
------ ------
Denominator for diluted earnings per share
- - weighted average
Shares and assumed conversions 2,797 2,809
------ ------
Basic earnings per share $ .38 $ .32
------ ------
Diluted earnings per share $ .36 $ .30
------ ------
(6) Securities
----------
The Company accounts for investments in debt and equity securities in accordance
with SFAS No. 115, which requires that investments be classified as either: (1)
Securities Held-to-Maturity - reported at amortized cost, (2) Trading Securities
- - reported at fair value, or (3) Securities Available-for-Sale - reported at
fair value. Unrealized gains and losses on securities available-for-sale are
reported as accumulated other comprehensive income (loss) in stockholders'
equity. Unrealized gains of $908,000, net of tax, on investments classified as
available-for-sale are recorded at December 31, 2004. The Company had no
securities classified as trading as of December 31, 2004 and September 30, 2004.
-9-
(7) Loans Receivable
----------------
Loans receivable are comprised of the following (dollar amounts in
thousands):
December 31, September 30,
2004 2004
------------ ------------
First mortgage loans:
Conventional:
1-4 family dwellings $ 119,220 $ 109,991
Multi-family dwellings 10,243 12,191
Commercial 51,367 50,334
Construction:
Residential 26,226 29,220
Commercial 7,189 7,211
--------- ---------
214,245 208,947
--------- ---------
Less:
Loans in process (18,938) (23,409)
Unearned discounts and fees (639) (612)
--------- ---------
194,668 184,926
--------- ---------
Installment loans:
Home equity 70,118 71,547
Consumer loans 1,717 1,749
Other 2,561 2,694
--------- ---------
74,396 75,990
--------- ---------
Commercial business loans and leases:
Commercial business loans 30,340 30,872
Commercial leases 910 1,210
--------- ---------
31,250 32,082
--------- ---------
Less: Allowance for loan losses (2,548) (2,609)
--------- ---------
Loans receivable, net $ 297,766 $ 290,389
--------- ---------
-10-
(8) Allowance for Loan Losses
-------------------------
Changes in the allowance for loan losses for the three months ended December 31,
2004 and the fiscal year ended September 30, 2004 are as follows (dollar amounts
in thousands):
December 31, September 30,
2004 2004
----------- ------------
Balance at beginning of period $ 2,609 $ 3,091
Provision for loan losses 175 275
Charge-offs (245) (819)
Recoveries 9 62
------- -------
Balance at end of period $ 2,548 $ 2,609
------- -------
The provision for loan losses charged to expense is based upon past loan loss
experience and an evaluation of probable losses in the current loan portfolio,
including the evaluation of impaired loans under SFAS Nos. 114 and 118. A loan
is considered to be impaired when, based upon current information and events, it
is probable that the Bank will be unable to collect all amounts due according to
the contractual terms of the loan. An insignificant shortfall in payments does
not necessarily result in a loan being identified as impaired. For this purpose,
delays less than 90 days are considered to be insignificant.
Impairment losses are included in the provision for loan losses. SFAS Nos. 114
and 118 do not apply to large groups of smaller balance, homogeneous loans that
are collectively evaluated for impairment, except for those loans restructured
under a troubled debt restructuring. Loans collectively evaluated for impairment
include consumer loans and residential real estate loans, and are not included
in the following data.
At December 31, 2004, the recorded investment in loans that are considered to be
impaired under SFAS No. 114 was $2.4 million compared to $2.4 million at
December 31, 2003. Included in the current amount is $316,000 of impaired loans
for which the related allowance for loan losses is $56,000, and $2.1 million of
impaired loans that as a result of applying impairment tests prescribed under
SFAS No. 114, do not have an allowance for loan losses. The average recorded
investment in impaired loans during the three months ended December 31, 2004 was
$2.4 million compared to $2.2 million for the same period in the prior year. For
the three months ended December 31, 2004, the Company recognized $14,000 of
interest income on impaired loans using the cash basis of income recognition.
The Company recognized $9,000 of interest income on impaired loans during the
three month period ended December 31, 2003.
(9) Comprehensive Income
--------------------
Total comprehensive income amounted to the following for the three months ended
December 31 (dollar amounts in thousands):
Three Months Ended
December 31,
2004 2003
-------------------
Net Income $ 1,005 $ 852
Unrealized holding gains (losses) on investment
securities and mortgage-backed securities available for
sale, net of tax $ (233) $ (35)
Reclassification adjustment for (gains) losses included
in net income $ (54) $ (59)
Comprehensive income $ 718 $ 758
======= =======
-11-
(10) Goodwill and Other Intangible Assets
------------------------------------
The Company performed its annual goodwill impairment test during the quarter
ended March 31, 2004 and it was determined that no adjustments were required.
(11) Guarantees
----------
The Company does not issue any guarantees that would require liability
recognition or disclosure, other than its standby letters of credit. Standby
letters of credit written are conditional commitments issued by the Company to
guarantee the performance of a customer to a third party. Generally, all letters
of credit, when issued have expiration dates within one year. The credit risk
involved in issuing letters of credit is essentially the same as that involved
in extending other loan commitments. The Bank requires collateral supporting
these letters of credit as deemed necessary. Management believes that the
proceeds obtained through a liquidation of such collateral would be sufficient
to cover the maximum potential amount of future payments required under the
corresponding guarantees. The current amount of liability as of December 31,
2004 and 2003for guarantees under standby letters of credit issued is not
material.
-12-
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
FIDELITY BANCORP, INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
The Private Securities Litigation Reform Act of 1995 contains safe harbor
provisions regarding forward-looking statements. When used in this discussion,
the words "believes," "anticipates," "contemplates," "expects," and similar
expressions are intended to identify forward-looking statements. Such statements
are subject to certain risks and uncertainties which could cause actual results
to differ materially from those projected. Those risks and uncertainties include
changes in interest rates, risks associated with the effect of integrating newly
acquired businesses, the ability to control costs and expenses, and general
economic conditions.
Fidelity Bancorp, Inc.'s ("Fidelity" or the "Company") business is conducted
principally through Fidelity Bank (the "Bank"). All references to the Company
refer collectively to the Company and the Bank, unless the context indicates
otherwise.
Critical Accounting Policies
- ----------------------------
Note 1 on pages 10 through 17 of the Company's 2004 Annual Report to
Shareholders lists significant accounting policies used in the development and
presentation of its financial statements. This discussion and analysis, the
significant accounting policies, and other financial statement disclosures
identify and address key variables and other qualitative and quantitative
factors that are necessary for an understanding and evaluation of the Company
and its results of operations.
The most significant estimates in the preparation of the Company's financial
statements are for the allowance for loan losses and accounting for stock
options. Please refer to the discussion of the allowance for loan losses in note
8 "Allowance for Loan Losses" on page 10 above. In addition, further discussion
of the estimates used in determining the allowance for loan losses is contained
in the discussion on "Provision for Loan Losses" on page 16 herein and page 49
of the Company's 2004 Annual Report to Shareholders. The Company accounts for
its stock option plans under the recognition and measurement principles of APB
Opinion No. 25, "Accounting for Stock Issued to Employees," and related
Interpretations. No stock-based employee compensation is reflected in net
income, as all options granted had an exercise price equal to the market value
of the underlying common stock on the grant date. Refer also to note 13 "Stock
Option Plans" on page 32 of the Company's 2004 Annual Report to Shareholders and
Note 3 "New Accounting Standards" on page 6 above
Comparison of Financial Condition
- ---------------------------------
Total assets of the Company increased $19.0 million, or 3.0%, to $646.7 million
at December 31, 2004 from $627.7 million at September 30, 2004. Significant
changes in individual categories include an increase in securities
held-to-maturity of $7.7 million, an increase in net loans of $7.4 million, and
an increase in securities available-for-sale of $4.0 million.
Total liabilities of the Company increased $19.5 million, or 3.3%, to $605.1
million at December 31, 2004 from $585.7 million at September 30, 2004.
Significant changes include an increase in short-term borrowings of $14.6
million, an increase in long-term debt of $4.9 million, and an increase in
advance payments by borrowers for taxes and insurance of $1.1 million. These
increases offset a $1.3 million decline in total deposits.
-13-
Stockholders' equity decreased $526,000, or 1.3% to $41.6 million at December
31, 2004, compared to $42.1 million at September 30, 2004. This result reflects
net income for the three-month period ended December 31, 2004 of $1.0 million,
stock options exercised of $247,000, and stock issued under the Dividend
Reinvestment Plan of $37,000. Offsetting these increases were common stock cash
dividends paid of $321,000, treasury stock purchased of $1.3 million, and a
decrease of accumulated other comprehensive income of $287,000. Accumulated
other comprehensive income decreased from September 30, 2004 as a result of
changes in the net unrealized gains on the available-for-sale securities due to
the fluctuations in interest rates during the current period. Management does
not consider the unrealized losses at December 31, 2004, to be other than
temporary. Because of interest rate volatility, the Company's accumulated other
comprehensive income could materially fluctuate for each interim and year-end
period. Approximately $3.4 million of the balances in retained earnings as of
December 31, 2004 and September 30, 2004 represent base year bad debt deductions
for tax purposes only, as they are considered restricted accumulated earnings.
Non-Performing Assets
- ---------------------
The following table sets forth information regarding non-accrual loans and
foreclosed real estate by the Company at the dates indicated. The Company did
not have any loans which were classified as troubled debt restructuring at the
dates presented (dollar amounts in thousands).
December 31, September 30,
2004 2004
---- ----
Non-accrual residential real estate loans
(one-to-four family) $ 896 $ 777
Non-accrual construction, multi family
residential and commercial real estate loans 269 269
Non-accrual installment loans 503 530
Non-accrual commercial business loans 2,124 2,071
------ ------
Total non-performing loans $3,792 $3,647
====== ======
Total non-performing loans as a percent of
net loans receivable 1.27% 1.26%
====== ======
Total foreclosed real estate $1,267 $1,517
====== ======
Total non-performing loans and foreclosed real estate as a
percent of total assets .78% .82%
====== ======
Included in non-performing loans at December 31, 2004 are 12 single-family
residential real estate loans totaling $896,000, 3 commercial real estate loans
totaling $269,000, 30 home equity and installment loans totaling $503,000, and
15 commercial business loans totaling $2.1 million.
-14-
At December 31, 2004, the Company had an allowance for loan losses of $2.5
million or .86% of net loans receivable, as compared to an allowance of $2.6
million or .90% of net loans receivable at September 30, 2004. The allowance for
loan losses equals 67.2% of non-performing loans at December 31, 2004 compared
to 71.5% at September 30, 2004. While the allowance for loan losses has
decreased, management believes the balance is adequate based on its analysis of
quantitative and qualitative factors as of December 31, 2004. Management has
evaluated its entire loan portfolio, including these non-performing loans, and
the overall allowance for loan losses and is satisfied that the allowance for
losses on loans at December 31, 2004 is reasonable. See also "Provision for Loan
Losses." However, there can be no assurance that the allowance for loan losses
is sufficient to cover possible future loan losses.
The Company recognizes that it must maintain an Allowance for Loan and Lease
Losses ("ALLL") at a level that is adequate to absorb estimated credit losses
associated with the loan and lease portfolio. The Company's Board of Directors
has adopted an ALLL policy designed to provide management with a systematic
methodology for determining and documenting the ALLL each reporting period. This
methodology was developed to provide a consistent process and review procedure
to ensure that the ALLL is in conformity with the Company's policies and
procedures and other supervisory and regulatory guidelines.
The Company's ALLL methodology incorporates management's current judgments about
the credit quality of the loan portfolio. The following factors are considered
when analyzing the appropriateness of the allowance: historical loss experience;
volume; type of lending conducted by the Bank; industry standards; the level and
status of past due and non-performing loans; the general economic conditions in
the Bank's lending area; and other factors affecting the collectibility of the
loans in its portfolio. The primary elements of the Bank's methodology include
portfolio segmentation and impairment measurement. Management acknowledges that
this is a dynamic process and consists of factors, many of which are external
and out of management's control, that can change often, rapidly and
substantially. The adequacy of the ALLL is based upon estimates considering all
the aforementioned factors as well as current and known circumstances and
events. There is no assurance that actual portfolio losses will not be
substantially different than those that were estimated.
-15-
Comparison of Results of Operations
-----------------------------------
for the Three Months Ended December 31, 2004 and 2003
-----------------------------------------------------
Net Income
- ----------
Net income for the three months ended December 31, 2004 was $1.0 million ($.36
per diluted share) compared to $852,000 ($.30 per diluted share) for the same
period in 2003, an increase of $153,000 or 18.0%. The increase reflects an
increase in net interest income of $416,000 or 13.7%, partially offset by an
increase in the provision for loan losses of $125,000, a decrease in other
income of $28,000, or 3.2%, an increase in other operating expenses of $89,000
or 3.2%, and an increase in the provision for income taxes of $21,000 or 9.6%.
Interest Rate Spread
- --------------------
The Company's interest rate spread, the difference between yields calculated on
a tax-equivalent basis on interest-earning assets and the cost of funds,
increased to 2.34% in the three months ended December 31, 2004 from 2.18% in the
same period in 2003 as a result of the average yield on total interest earning
assets increasing and the average rate paid on interest-bearing liabilities
decreasing. The following table shows the average yields earned on the Bank's
interest-earning assets and the average rates paid on its interest-bearing
liabilities for the periods indicated, the resulting interest rate spreads, and
the net yields on interest-earning assets.
Three Months Ended
December 31,
2004 2003
---- ----
Average yield on:
Mortgage loans 6.01% 6.54%
Mortgage-backed securities 3.89 3.00
Installment loans 5.84 6.16
Commercial business loans and leases 6.28 6.14
Interest -earning deposits with other institutions,
investment securities, and FHLB stock (1) 4.55 4.42
---- ----
Total interest-earning assets 5.10 5.02
---- ----
Average rates paid on:
Savings deposits 2.04 2.21
Borrowed funds 3.76 3.96
---- ----
Total interest-bearing liabilities 2.76 2.84
---- ----
Average interest rate spread 2.34% 2.18%
===== =====
Net yield on interest-earning assets 2.39% 2.24%
===== =====
(1) Interest income on tax-free investments has been adjusted for federal
income tax purposes using a rate of 34%.
Interest Income
- ---------------
Interest on loans increased $111,000 or 2.6% to $4.4 million for the three
months ended December 31, 2004, compared to the same period in 2003. The
increase reflects an increase in the average loan balance outstanding during
2004, partially offset by a decrease in the average yield earned on the loan
portfolio.
Interest on mortgage-backed securities increased $425,000 or 45.9% to $1.4
million for the three-month period ended December 31, 2004, as compared to the
same period in 2003. The increase reflects an increase in the average yield
earned on the portfolio, as well as an increase in the average balance of
mortgage-backed securities owned in the period.
-16-
Interest on interest-bearing demand deposits with other institutions and
investment securities decreased $109,000 or 5.7%, for the three months ended
December 31, 2004, as compared to the same period in 2003. The decrease reflects
a decrease in the average balance in the portfolio partially offset by an
increase in the yield earned on these investments.
Interest Expense
- ----------------
Interest on deposits decreased $198,000 or 9.7% to $1.8 million for the
three-month period ended December 31, 2004, as compared to the same period in
2003. The decrease reflects a decrease in the average cost of the deposits, as
well as a decrease in the average balance of deposits.
Interest on subordinated debt increased $23,000 for the three months ended
December 31, 2004, as compared to the same period in 2003. The increase reflects
an increase in the rate paid on the subordinated debt.
Interest on short-term borrowings, including Federal Home Loan Bank ("FHLB")
"RepoPlus" advances, securities sold under agreement to repurchase, and
treasury, tax and loan notes, increased $262,000 to $420,000 for the three-month
period ended December 31, 2004, as compared to the same period in fiscal 2003.
The increase reflects an increase in the average balance of these borrowings, as
well as an increase in the average cost of these borrowings.
Interest on long-term debt, including FHLB fixed rate advances and "Convertible
Select" advances, decreased $76,000, or 4.2%, to $1.7 million for the three
months ended December 31, 2004 as compared to the same period in fiscal 2003.
The decrease reflects a decrease in the average balance of the debt, as well as
a decrease in the average cost of the debt.
The Company continues to rely on FHLB advances as cost effective wholesale
funding sources.
Net Interest Income
- -------------------
The Company's net interest income increased $416,000 or 13.7% to $3.5 million,
for the three month period ended December 31, 2004, as compared to the same
period in 2003. The increase in the current fiscal period is attributable to an
increased interest rate spread, as well as an increase in net interest-earning
assets. The interest rate spread increased to 2.34% for the three-month period
ended December 31, 2004, compared to 2.18% for the same period in 2003. Average
net interest-earning assets increased $353,000, or 10.6%, for the three-month
period ended December 31, 2004, as compared to the same period in 2003.
Provision for Loan Losses
- -------------------------
The provision for loan losses increased to $175,000 for the three-month period
ended December 31, 2004, as compared to $50,000 for the same period in 2003. The
increase primarily results from the write-off of commercial business loans of
approximately $172,000 during the current quarter. Similar losses were not
incurred in the prior year period. At December 31, 2004, the allowance for loan
losses decreased $61,000 to $2.55 million from $2.61 million at September 30,
2004. Net loan charge-offs were $236,000 and $27,000 for the three months ended
December 31, 2004 and 2003, respectively.
-17-
The provision for loan losses is charged to operations to bring the total
allowance for loan losses to a level that represents management's best estimates
of the losses inherent in the portfolio based on a monthly review by management
of factors such as historical experience, volume, type of lending conducted by
the Bank, industry standards, the level and status of past due and
non-performing loans, the general economic conditions in the Bank's lending
area, and other factors affecting the collectibility of the loans in its
portfolio.
The allowance for loan losses is maintained at a level that represents
management's best estimates of losses in the loan portfolio at the balance sheet
date. However, there can be no assurance that the allowance for losses will be
adequate to cover losses which may be realized in the future and that additional
provisions for losses will not be required.
Other Income
- ------------
Total non-interest or other income decreased $28,000 or 3.2% to $841,000, for
the three-month period ended December 31, 2004, as compared to the same period
in 2003. Decreases in other income primarily relate to decreased gains on the
sale of securities, decreased gains on the sale of loans, and decreased other
operating income.
Net gains on the sales of securities were $82,000 for the three month period
ended December 31, 2004, as compared to a gain of $89,000 in the same period in
2003. Such sales were made from the available-for-sale portfolio as part of
management's asset/liability management strategies.
Gain on the sale of loans was $5,000 for the three-month period ended December
31, 2004, as compared to a gain of $17,000 for the same period in 2003. The
three-month period ended December 31, 2004 results include the sale of
approximately $307,000 of fixed rate, single-family mortgage loans, compared to
$406,000 of similar loan sales during the prior fiscal period.
Other operating income was $301,000 for the three-month period ended December
31, 2004, as compared to $311,000 for the same period in 2003. The decrease is
due primarily to a decrease in the gain on the sale of premises and equipment
and other non-operating income partially offset by increase in ATM fees and fees
on retail investment sales.
Operating Expenses
- ------------------
Total operating expenses for the three-month period ended December 31, 2004
totaled $2.9 million compared to $2.8 million for the same period in 2003. The
increase is due primarily to an increase in compensation and benefits expense,
office occupancy and equipment, and increased net loss on foreclosed real
estate.
Compensation and benefits expense was $1.82 million for the three-month period
ended December 31, 2004, as compared to $1.77 million for the same period in
2003. The increase is due primarily to normal salary increases for employees and
increases in the cost of health insurance.
Office occupancy and equipment expense was $257,000 for the three-month period
ended December 31, 2004, as compared to $233,000 for the same period in 2003.
The increase primarily reflects an increase in rent expense and increased office
repairs and maintenance expense.
Net loss on foreclosed real estate was $19,000 for the three-month period ended
December 31, 2004, as compared to $2,000 for the same period in 2003. The
results reflect the costs associated with the holding and disposition of
properties during the periods. At December 31 ,2004, the Bank had eighteen
single-family residential properties, seventeen of which were owned by the same
borrower as investment properties, and two commercial real estate properties
classified as foreclosed real estate.
-18-
Income Taxes
- ------------
Total income tax expense for the three-month period ended December 31, 2004 was
$241,000 compared to $220,000 for the same 2003 period. The effective tax rates
for the three-month periods ended December 31, 2004 and 2003 were approximately
19.3% and 20.5%, respectively. Tax-exempt income includes income earned on
certain municipal investments that qualify for state and/or federal income tax
exemption; income earned by the Bank's Delaware subsidiary which is not subject
to state income tax, and earnings on Bank-owned life insurance policies which
are exempt from federal taxation. State and federal tax-exempt income for the
three-month period ended December 31, 2004 was $1.9 million and $429,000,
respectively, compared to $1.9 million and $540,000, respectively, for the
three-month period ended December 31, 2003.
Capital Requirements
- --------------------
The Federal Reserve Board measures capital adequacy for bank holding companies
on the basis of a risk-based capital framework and a leverage ratio. The
guidelines include the concept of Tier 1 capital and total capital. Tier 1
capital is essentially common equity, excluding net unrealized gain (loss) on
securities available-for-sale and goodwill, plus certain types of preferred
stock, including the Preferred Securities issued by FB Statutory Trust II in
2003. The Preferred Securities may comprise up to 25% of the Company's Tier 1
capital. Total capital includes Tier 1 capital and other forms of capital such
as the allowance for loan losses, subject to limitations, and subordinated debt.
The guidelines establish a minimum standard risk-based target ratio of 8%, of
which at least 4% must be in the form of Tier 1 capital. At December 31, 2004,
the Company had Tier 1 capital as a percentage of risk-weighted assets of 13.06%
and total risk-based capital as a percentage of risk-weighted assets of 13.86%.
In addition, the Federal Reserve Board has established minimum leverage ratio
guidelines for bank holding companies. These guidelines currently provide for a
minimum ratio of Tier 1 capital as a percentage of average total assets (the
"Leverage Ratio") of 3% for bank holding companies that meet certain criteria,
including that they maintain the highest regulatory rating. All other bank
holding companies are required to maintain a Leverage Ratio of at least 4% or be
subject to prompt corrective action by the Federal Reserve. At December 31,
2004, the Company had a Leverage Ratio of 7.47%.
The FDIC has issued regulations that require insured institutions, such as the
Bank, to maintain minimum levels of capital. In general, current regulations
require a leverage ratio of Tier 1 capital to average total assets of not less
than 3% for the most highly rated institutions and an additional 1% to 2% for
all other institutions. At December 31, 2004, the Bank complied with the minimum
leverage ratio having Tier 1 capital of 7.70% of average total assets, as
defined.
The Bank is also required to maintain a ratio of qualifying total capital to
risk-weighted assets and off-balance sheet items of a minimum of 8%. At December
31, 2004, the Bank's total capital to risk-weighted assets ratio calculated
under the FDIC capital requirement was 12.90%.
Liquidity
- ---------
The Company's primary sources of funds have historically consisted of deposits,
amortization and prepayments of outstanding loans, borrowings from the FHLB of
Pittsburgh and other sources, including sales of securities and, to a limited
extent, loans. At December 31, 2004, the total of approved loan commitments
amounted to $2.2 million. In addition, the Company had $18.9 million of
undisbursed loan funds at that date. The amount of savings certificates which
mature during the next twelve months totals approximately $84.0 million, a
substantial portion of which management believes, on the basis of prior
experience as well as its competitive pricing strategy, will remain in the
Company.
-19-
Off Balance Sheet Commitments
- -----------------------------
The Bank is party to financial instruments with off-balance sheet risk in the
normal course of business to meet the financing needs of its customers. These
financial instruments include commitments to extend credit and letters of
credit. Those instruments involve, to varying degrees, elements of credit and
interest rate risk in excess of the amount recognized in the balance sheet.
The Bank's exposure to credit loss in the event of nonperformance by the other
party to the financial instrument for commitments to extend credit and letters
of credit is represented by the contractual amount of those instruments. The
Bank uses the same credit policies in making commitments and conditional
obligations as it does for on-balance sheet instruments.
A summary of the contractual amount of the Company's financial instrument
commitments is as follows:
December 31, September 30,
2004 2004
---- ----
(in thousands)
Commitments to grant loans $ 2,217 $13,133
Unfunded commitments under lines of credit 39,828 36,092
Financial and performance standby letters of credit 295 175
The Company does not issue any guarantees that would require liability
recognition or disclosure, other than its standby letters of credit. Standby
letters of credit written are conditional commitments issued by the Company to
guarantee the performance of a customer to a third party. Generally, all letters
of credit, when issued have expiration dates within one year. The credit risk
involved in issuing letters of credit is essentially the same as that involved
in extending other loan commitments. The Bank requires collateral supporting
these letters of credit as deemed necessary. Management believes that the
proceeds obtained through a liquidation of such collateral would be sufficient
to cover the maximum potential amount of future payments required under the
corresponding guarantees. The current amount of liability as of December 31,
2004 for guarantees under standby letters of credit issued is not material.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
There have been no material changes in information regarding
quantitative and qualitative disclosures about market risk at December
31, 2004 from the information presented under the caption,
Management's Discussion and Analysis of Financial Condition and
Results of Operations - Asset and Liability Management, filed as
Exhibit 13 to the Form 10-K for September 30, 2004.
-20-
Item 4. Controls and Procedures
The Company's management evaluated, with the participation of the
Company's Chief Executive Officer and Chief Financial Officer, the
effectiveness of the Company's disclosure controls and procedures, as
of the end of the period covered by this report. Based on that
evaluation, the Chief Executive Officer and Chief Financial Officer
concluded that the Company's disclosure controls and procedures are
effective to ensure that information required to be disclosed by the
Company in the reports that it files or submits under the Securities
Exchange Act of 1934 is recorded, processed, summarized and reported
within the time periods specified in the Securities and Exchange
Commission's rules and forms.
There were no changes in the Company's internal control over financial
reporting that occurred during the Company's last fiscal quarter that
have materially affected, or are reasonably likely to materially
affect, the Company's internal control over financial reporting.
Part II - Other Information
- ---------------------------
Item 1. Legal Proceedings
The Bank is not involved in any pending legal proceedings other than
non-material legal proceedings undertaken in the ordinary course of
business.
-21-
Item 2. Unregistered Sales of Equity Securities, Use of Proceeds and Issuer
Purchases of Equity Securities
ISSUER PURCHASES OF EQUITY SECURITIES
Total Number of Shares
Total Number Average Price (or Units) Purchased as Maximum Number (or Approximate
of Shares Paid per Part of Publicly Dollar Value) of Shares (or
(or Units) Share (or Announced Plans or Units) that May Yet Be Purchased
Period Purchased Unit) Programs * Under the Plans or Programs
------ ----------- ----------- --------------------- -------------------------------
October - $- - 72,958
1-31, 2004
November 1-30, 12,000 $22.55 12,000 60,958
2004
December 42,210 $23.55 42,210 18,748
1-31, 2004
Total 54,210 $23.33 54,210 18,748
* On October 23, 2003, the Registrant announced a stock repurchase plan for up
to 5% of shares outstanding, or 133,000 shares.
Item 3. Defaults Upon Senior Securities
Not Applicable
Item 4. Submission of Matters to a Vote of Security Holders
None
Item 5. Other Information
(a) On February 8, 2005, the Company's stockholders approved the 2005
Stock-Based Incentive Plan which became effective on such date. The
2005 Stock-Based Incentive Plan provides for the granting of stock
options and restricted stock awards to directors, officers and
employees of the Company and its affiliates. A total of 150,000 shares
of the Company's common stock are reserved for issuance under the 2005
Stock-Based Incentive Plan. Effective on stockholder approval, each
non-employee director was granted options for 2,000 shares of the
Common Stock with an exercise price equal to the fair market value of
the underlying Common Stock.
(b) Not applicable.
-22-
Item 6. Exhibits
The following exhibits are filed as part of this Report.
3.1 Articles of Incorporation (1)
3.2 Amended Bylaws (2)
4.1 Rights Agreement dated June 30, 2003 between Fidelity Bancorp, Inc. and Registrar and Transfer Company (3)
4.3 * Indenture, dated as of September 26, 2002, between Fidelity Bancorp, Inc. and State Street Bank and Trust
Company of Connecticut, National Association
4.4 * Amended and Restated Declaration of Trust, dated as of September 26, 2002, by and among State Street Bank
and Trust Company, National Association, as Institutional Trustee, Fidelity Bancorp, Inc., as Sponsor and
William L. Windisch, Richard G. Spencer and Lisa L. Griffith, as Administrators.
4.5 * Guarantee Agreement, as dated as of September 26, 2002, by and between Fidelity Bancorp, Inc. and State
Street Bank and Trust Company of Connecticut, National Association.
10.1 Employee Stock Ownership Plan, as amended (1)
10.2 1988 Employee Stock Compensation Program (1)
10.3 1993 Employee Stock Compensation Program (4)
10.4 1997 Employee Stock Compensation Program (5)
10.5 1993 Directors' Stock Option Plan (4)
10.6 1998 Group Term Replacement Plan (6)
10.7 1998 Salary Continuation Plan Agreement by and between W.L. Windisch, the Company and the Bank (6)
10.8 1998 Salary Continuation Plan Agreement by and between R.G. Spencer, the Company and the Bank (6)
10.9 1998 Salary Continuation Plan Agreement by and between M.A. Mooney, the Company and the Bank (6)
10.10 Salary Continuation Plan Agreement with Lisa L. Griffith
10.11 1998 Stock Compensation Plan (7)
10.12 2000 Stock Compensation Plan (8)
10.13 2001 Stock Compensation Plan (9)
10.14 2002 Stock Compensation Plan (10)
20.1 Dividend Reinvestment Plan (11)
31.1 Section 302 Certification of Chief Executive Officer
31.2 Section 302 Certification of Chief Financial Officer
32 Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002
-23-
(1) Incorporated by reference from the exhibits attached to the Prospectus and
Proxy Statement of the Company included in its Registration Statement on
Form S-4 (registration No. 33-55384) filed with the SEC on December 3, 1992
(the "Registration Statement").
(2) Incorporated by reference to an identically numbered exhibit in Form 10-Q
filed with the SEC on August 14, 2002.
(3) Incorporated by reference from Form 8-A filed June 30, 2003.
(4) Incorporated by reference from an exhibit in Form S-8 filed with the SEC on
May 2, 1997.
(5) Incorporated by reference from an exhibit in Form S-8 filed with the SEC on
March 12, 1998.
(6) Incorporated by reference to an identically numbered exhibit in Form 10-K
filed with the SEC on December 29, 1998.
(7) Incorporated by reference from an exhibit in Form S-8 filed with the SEC on
January 25, 1999.
(8) Incorporated by reference to Exhibit 4.1 to the Form S-8 filed with the SEC
on January 19, 2001.
(9) Incorporated by reference from an exhibit in Form S-8 filed with the SEC on
January 29, 2002.
(10) Incorporated by reference from an exhibit in Form S-8 filed with the SEC on
February 26, 2003.
(11) Incorporated by reference to an identically numbered exhibit in Form 10-Q
filed with the SEC on February 14, 2000.
-24-
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
FIDELITY BANCORP, INC.
Date: February 14, 2005 By: /s/ Richard G. Spencer
----------------------------------------------
Richard G. Spencer
President and Chief Executive Officer
Date: February 14, 2005 By: /s/ Lisa L. Griffith
----------------------------------------------
Lisa L. Griffith
Sr. Vice President and Chief Financial Officer
-25-