-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, MKbuLjBCZD6K/Mvd2ekgZYjk5ZN36So9fTJV8J9dFaC/4scqUytA27cc5HXBFHMn 0sUrvfNNHLRCQnae7Zje2w== 0000926274-98-000270.txt : 19980910 0000926274-98-000270.hdr.sgml : 19980910 ACCESSION NUMBER: 0000926274-98-000270 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19980820 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19980908 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: FIDELITY FEDERAL BANCORP CENTRAL INDEX KEY: 0000910492 STANDARD INDUSTRIAL CLASSIFICATION: SAVINGS INSTITUTION, FEDERALLY CHARTERED [6035] IRS NUMBER: 351894432 STATE OF INCORPORATION: IN FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 000-22880 FILM NUMBER: 98705665 BUSINESS ADDRESS: STREET 1: 18 N W FOURTH ST STREET 2: P O BOX 1347 CITY: EVANSVILLE STATE: IN ZIP: 47706-1347 BUSINESS PHONE: 8124240921 MAIL ADDRESS: STREET 1: 18 NW FOURTH ST STREET 2: PO BOX 1347 CITY: EVANSVILLE STATE: IN ZIP: 47706-1347 8-K 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K Current Report Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): September 4, 1998 FIDELITY FEDERAL BANCORP ------------------------------------------------------ (Exact name of Registrant as specified in its charter) Indiana 0-22880 35-1894432 - ---------------------------- ------------------------ ------------------- (State or other jurisdiction (Commission File Number) (IRS Employer of incorporation) Identification No.) 700 South Green River Road, Suite 2000, Evansville, Indiana 47715 ----------------------------------------------------------- -------- (Address of Principal Executive Offices) Zip Code (812) 469-2100 ---------------------------------------------------- (Registrant's telephone number, including area code) ITEM 5. OTHER EVENTS On September 4, 1998, Fidelity Federal Bancorp (the "Registrant") issued the press release as set forth herein. ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS (C) EXHIBITS 99 Press release of the Registrant issued on September 4, 1998. * * * 2 SIGNATURES 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 hereunto duly authorized. FIDELITY FEDERAL BANCORP (Registrant) Date: September 4, 1998 By: /s/ M. BRIAN DAVIS ------------------ M. Brian Davis President 3 EX-99 2 EXHIBIT 99 FIDELITY FEDERAL BANCORP LETTERHEAD CONTACTS: M. BRIAN DAVIS, PRESIDENT AND CEO (812)471-8141 DONALD R. NEEL, EXEC. VP AND CFO (812)469-2100, EXT. 14 FOR IMMEDIATE RELEASE SEPTEMBER 4, 1998 FIDELITY FEDERAL BANCORP RELEASES YEAR END RESULTS AND RESTATES THIRD QUARTER EARNINGS; SUSPENDS QUARTERLY DIVIDEND (Evansville, Indiana) Fidelity Federal Bancorp (the "Company") (NASDAQ NMS:FFED), the holding company of United Fidelity Bank, fsb (the "Bank"), reported a loss for the fiscal year ending June 30, 1998 of $6.8 million or $2.30 per share on a basic and diluted basis, compared to net income the previous fiscal year of $113,000 or $0.05 per share on a basic per share basis and $0.04 on a diluted basis. The 1998 year end results reflect a restatement of the third quarter earnings for an additional $1.4 million provision for loan losses, bringing the total provision for loan losses in the third quarter to $4.3 million, and an increase in third quarter non-interest expense of $8.7 million, bringing the non-interest expense for the third quarter to $11.1 million. The third quarter charges were taken primarily in connection with the Company's Internal Revenue Code ("IRC") Section 42 tax-credit real estate development program (the "Section 42 projects") which was primarily in operation between 1993 and 1996 and followed an examination of the Bank and the Company by the Company's primary regulator, the Office of Thrift Supervision. The methodology used by the OTS to compute the allowance for loan losses and to establish reserves for letters of credit in connection with the Section 42 projects was different than those previously used by the Company and was adopted by management. The Section 42 projects continue to comply with the requirements of IRC Section 42 and have not sustained any tax-credit recapture. Net income for the fourth quarter was $411,000 or $0.13 per share on a diluted basis, compared to $314,000, or $0.12 per share on a diluted basis. Excluding charges taken in the third quarter, the Company's net income would have been approximately $1.4 million for the year or $0.46 per share on a diluted basis. Net interest income decreased $396,000 for the fourth quarter and $845,000 for the year compared to the same periods last year. Average earning assets for the fourth quarter and year decreased $51.8 million and $37.2 million, respectively, primarily the reason for the decrease in net interest income. The net interest margin increased to 2.79% for the year compared to 2.72% last year. The fourth quarter net interest margin decreased slightly to 2.92% compared to 2.96% for the same period last year. Net interest income decreased $242,000 for the third quarter, primarily due to quarterly average earning assets decreasing $44.7 million compared to last year. The net interest margin continued to increase for the third quarter to 2.73% compared to 2.64% for the same period last year. The year to date net interest margin at March 31, 1998 increased 10 basis to 2.74% compared to last year. The additional $8.7 million in non-interest expense in the third quarter reflects (i) additional specific reserves related to letters of credit issued by the Company and the Bank in the Section 42 projects of $6.8 million, (ii) a charge-off of the equity investments in the Section 42 projects by the Bank's subsidiary, Village Housing Corporation, and (iii) and the charge-off of receivables related to management fees, investment banking fees, letter of credit fees, and development fees in connection with the Section 42 projects. These charge-offs reflect the lower-than-projected occupancy rates, rent amounts and cash flows of the Section 42 projects. Current occupancy rates are significantly improved over the levels in which the charge-offs were based currently average in excess of 90%. The additional $1.4 million provision for loan losses in the third quarter reflects a charge-off of Section 42 loans classified as loss and an increase in the provision for the remaining Section 42 loans which are classified substandard or doubtful. Year to date provision for loan losses at June 30, 1998 was $4.5 million compared to $975,000 at June 30, 1997. This increase is primarily the result of the third quarter provision which is discussed above. The fourth quarter provision for loan losses was $20,000 compared to $60,000 for the same period last year. Due to the above provision, the allowance for loan losses to total loans at June 30, 1998 was 1.91% compared to 0.87% last fiscal year. Net charge-offs to average loans for the fourth quarter was 0.15% compared to 0.12% for the same period last year. On a year to date basis, net charge-offs to average loans were 1.81% and 0.12% for fiscal 1998 and 1997. Specific reserves for letters of credit to total letters of credit were 12.21%, representing specific reserves set aside for off balance sheet letters of credit. The allowance for loan losses to total loans at March 31, 1998 increased to 1.89% compared to 0.85% last year. Return on average assets for the fourth quarter was 0.84% compared to 0.51% for the same period last year. Year to date return on average assets was - -3.12% compared to 0.04% last year resulting from the third quarter charges. Return on equity for the fourth quarter was 22.75% compared to 9.46% for the fourth quarter 1997. Return on equity for the year was -50.68% compared to 0.83 % last year. The Company has ceased originating, participating, or investing in new or additional Section 42 projects. It is currently pursuing a plan to refinance its Section 42 projects which, if successful, could result in reversal of a portion of the additional charges taken to non-interest expense. The availability of such refinancing depends upon numerous factors, including, among other things, interest rates, third-party appraisals, and occupancy levels in the Section 42 projects. Capital ratios at the Bank decreased primarily due to the third quarter loss. Tangible equity to assets at June 30, 1998 was 6.31% compared to 6.93% last year. Risk-based capital was 10.79% at June 30, 1998 compared to 10.74% last year, above the "well capitalized" level. Tangible equity to assets at March 31, 1998 decreased to 6.11% from 6.63% a year ago. Risk-based capital decreased from 10.89% at March 31, 1997 to 10.61% at March 31, 1998, also above the regulatory "well capitalized" level. In conjunction with these results, the Company announced that it was suspending the payment of dividends, and that future dividends may be subject to regulatory approval. In addition, the Company is exploring entering into discussions regarding an affiliation with other financial institutions. This news release contains forward-looking statements that are based upon the Company's current expectations, but are subject to certain risks and uncertainties which may cause actual results to differ materially. Among the risks and uncertainties that could cause actual results to vary materially are economic conditions generally and in the market areas of the Company and the Bank, increased competition in the financial services industry, actions by the Federal Reserve Board and changes in interest rates, loan prepayments by, and the financial health of, the Bank's borrowers, and other factors described in the reports filed by the Company with the Securities and Exchange Commission. The Company is a unitary savings and loan holding company based in Evansville, Ind. Its savings bank subsidiary, United Fidelity Bank, fsb, maintains four locations in Evansville. Its other wholly owned subsidiary, Village Securities Corporation, is a deep discount stock and bond brokerage firm that was recently activated. The Bank participates in various real estate activities including mortgage banking and finance, as well as owning, developing, building, renting and managing housing developments through its wholly-owned subsidiaries: Village Capital Corporation, Village Community Development Corporation, Village Housing Corporation, and Village Management Corporation. The Bank also offers an array of insurance products through Village Insurance Corporation. Information on FFED is available on the Internet at http://www.ufb-ffed.com FIDELITY FEDERAL BANCORP FINANCIAL HIGHLIGHTS (DOLLARS IN THOUSANDS EXCEPT SHARE AND PER SHARE DATA)
THREE MONTHS ENDED NINE MONTHS ENDED MARCH 31 MARCH 31 OPERATIONS: 1998 1997 1998 1997 - --------------------------------------------- --------------- -------------- -------------- ------------- Interest income $ 3,993 $ 4,935 $ 13,334 $ 15,224 Interest expense 2,700 3,400 9,042 10,484 --------------- -------------- -------------- ------------- Net interest income 1,293 1,535 4,292 4,740 Provision for loan losses 4,298 60 4,523 915 Non-interest income 590 1,209 2,414 3,054 Non-interest expense 11,070 1,963 14,417 7,400 --------------- -------------- -------------- ------------- Income (loss) before income tax (13,485) 721 (12,234) (521) Income taxes (5,363) 192 (5,029) (321) --------------- -------------- -------------- ------------- Net income (loss) (8,122) 529 (7,205) (200) =============== ============== ============== ============= PER SHARE: - --------------------------------------------- Basic net income (loss) $ (2.60) $ 0.21 $ (2.49) $ (0.08) Diluted net income (loss) (2.60) 0.20 (2.49) (0.08) Cash dividends declared 0.10 0.10 0.30 0.50 Book value at period end 2.33 5.17 Market price (bid) at period end 9.38 8.25 Average common and common equivalent shares outstanding 3,127,240 2,630,667 2,899,348 2,686,040 AVERAGE BALANCES: - --------------------------------------------- Total assets $ 207,914 $ 252,743 $ 225,287 $ 256,260 Total earning assets 192,352 237,038 208,873 240,682 Total loans 172,115 210,426 186,708 216,102 Total deposits 153,973 186,048 169,766 184,549 Total stockholders' equity 15,984 13,014 15,283 13,675 Federal funds purchased 30 10 1,200 FHLB advances 18,677 30,372 19,921 35,259 Borrowings 17,240 21,653 17,831 19,358 PERFORMANCE RATIOS: - --------------------------------------------- Return on average assets -15.84% 0.85% -4.26% -0.10% Return on average equity -206.07% 16.48% -62.80% -1.95% Net interest margin 2.73% 2.64% 2.74% 2.64% LOAN QUALITY RATIOS: - --------------------------------------------- Net charge-offs to average loans 7.07% 0.22% 2.29% 0.12% Allowance for loan losses to total loans at end of period 1.89% 0.85% Non-performing loans to total loans 0.46% 0.16% Classified loans and letters of credit to total loans and letters of credit 2.65% 0.13% Specific reserves for letters of credit to total 12.20% letters of credit SAVING'S BANK CAPITAL RATIOS: - --------------------------------------------- Tangible equity to assets at end of period 6.11% 6.63% Risk-based capital ratios: Tier 1 capital 6.61% 7.75% Total capital 10.61% 10.89% AT PERIOD END: - --------------------------------------------- Total assets $ 199,684 $ 250,285 Total earning assets 183,586 235,219 Total loans 163,297 210,360 Total deposits 146,672 185,803 Total stockholders' equity 7,273 12,865 FHLB Advances 18,627 27,604 Borrowings 17,166 21,282 Common shares outstanding 3,127,210 2,490,110
FIDELITY FEDERAL BANCORP FINANCIAL HIGHLIGHTS (DOLLARS IN THOUSANDS EXCEPT SHARE AND PER SHARE DATA)
THREE MONTHS ENDED TWELVE MONTHS ENDED EXCLUDING FOURTH QUARTER ENDED JUNE 30: 1998 1997 1998 1997 CHARGES - -------------------------------------------- ----------- ------------ ------------ --------------------------- Interest income $ 3,859 $ 5,058 $ 17,192 $ 20,282 $ 17,192 Interest expense 2,544 3,347 11,586 13,831 11,586 ----------- ------------ ------------ --------------------------- Net interest income 1,315 1,711 5,606 6,451 5,606 Provision for loan losses 20 60 11,321 975 357 Non-interest income 611 803 3,025 3,856 3,025 Non-interest expense 1,660 2,074 9,298 9,474 6,585 ----------- ------------ ------------ --------------------------- Income before income tax 246 380 (11,988) (142) 1,689 Income taxes (165) 66 (5,194) (255) 241 ----------- ------------ ------------ --------------------------- Net income $ 411 $ 314 $ (6,794) $ 113 $ 1,448 =========== ============ ============ =========================== PER SHARE: - -------------------------------------------- Basic net income $ 0.13 $ 0.13 $ (2.30) $ 0.05 0.49 Diluted net income 0.13 0.12 (2.30) 0.04 0.48 Cash dividends declared 0.05 0.10 0.35 0.60 0.35 Book value at period end 2.40 5.20 5.03 Market Price (bid) at period end 6.50 8.75 Average common and common equivalent shares outstanding 3,147,007 2,583,945 2,956,157 2,655,181 AVERAGE BALANCES: - -------------------------------------------- Total assets $ 191,769 $ 247,853 $ 216,036 $ 254,130 Total earning assets 179,107 231,680 200,451 238,438 Total loans 162,810 210,221 179,748 213,793 Total deposits 143,948 181,231 163,422 183,706 Total stockholders' equity 11,810 13,297 13,406 13,596 Federal funds purchased 436 3,648 116 1,810 FHLB Advances 17,239 26,740 19,253 33,136 Borrowings 17,199 20,585 17,673 19,664 PERFORMANCE RATIOS: - -------------------------------------------- Return on average assets 0.86% 0.51% -3.15% 0.04% 0.67% Return on average equity 13.95% 9.46% -50.68% 0.83% 10.80% Net interest margin 2.93% 2.98% 2.80% 2.72% LOAN QUALITY RATIOS: - -------------------------------------------- Net charge-offs to average loans 0.15% 0.12% 3.57% 0.12% Allowance for loan losses to total loans at end of period 4.27% 0.87% Non-performing loans to total loans 0.14% SAVING'S BANK CAPITAL RATIOS: - -------------------------------------------- Tangible equity to assets at end of period 6.41% 6.93% Risk-based capital ratios: Tier 1 capital 6.79% 7.64% Total capital 10.82% 10.74% AT PERIOD END: - -------------------------------------------- Total assets $ 190,268 $ 240,001 Total earning assets 176,633 224,438 Total loans 156,594 204,964 Total deposits 148,939 181,787 Total stockholders' equity 7,514 12,936 FHLB Advances 14,783 23,337 Borrowings 17,236 19,943 Common shares outstanding 3,127,208 2,487,385
FIDELITY FEDERAL BANCORP FINANCIAL HIGHLIGHTS (DOLLARS IN THOUSANDS EXCEPT SHARE AND PER SHARE DATA)
THREE MONTHS ENDED YEAR ENDED JUNE 30 JUNE 30 OPERATIONS: 1998 1997 1998 1997 - --------------------------------------------- ------------- --------------- -------------- ------------- Interest income 3,859 5,058 17,192 20,282 Interest expense 2,544 3,347 11,586 13,831 ------------- --------------- -------------- ------------- Net interest income 1,315 1,711 5,606 6,451 Provision for loan losses 20 60 4,543 975 Non-interest income 611 803 3,025 3,856 Non-interest expense 1,660 2,074 16,076 9,474 ------------- --------------- -------------- ------------- Income (loss) before income tax 246 380 (11,988) (142) Income taxes (165) 66 (5,194) (255) ------------- --------------- -------------- ------------- Net income (loss) $ 411 $ 314 $ (6,794) $ 113 ============= =============== ============== ============= PER SHARE: - --------------------------------------------- Basic net income (loss) $ 0.13 $ 0.13 $ (2.30) $ 0.05 Diluted net income (loss) 0.13 0.12 (2.30) 0.04 Cash dividends declared 0.05 0.10 0.35 0.60 Book value at period end 2.40 5.20 Market price (bid) at period end 6.50 8.75 Average common and common equivalent shares outstanding 3,127,210 2,583,945 2,956,157 2,655,181 AVERAGE BALANCES: - --------------------------------------------- Total assets $ 196,038 $ 247,853 $ 217,726 $ 254,130 Total earning assets 179,851 231,680 201,233 238,438 Total loans 163,554 210,221 180,530 213,793 Total deposits 143,948 181,231 163,422 183,706 Total stockholders' equity 7,245 13,297 13,406 13,596 Federal funds purchased 436 3,648 116 1,810 FHLB advances 17,239 26,740 19,253 33,136 Borrowings 17,199 20,585 17,673 19,664 PERFORMANCE RATIOS: - --------------------------------------------- Return on average assets 0.84% 0.51% -3.12% 0.04% Return on average equity 22.75% 9.46% -50.68% 0.83% Net interest margin 2.92% 2.96% 2.79% 2.72% LOAN QUALITY RATIOS: - --------------------------------------------- Net charge-offs to average loans 0.15% 0.12% 1.81% 0.12% Allowance for loan losses to total loans at end of period 1.91% 0.87% Non-performing loans to total loans 0.36% 0.14% Classified loans and letters of credit to total loans and letters of credit 2.70% 0.11% Specific reserves for letters of credit to total letters of credit 12.21% SAVINGS BANK CAPITAL RATIOS: - --------------------------------------------- Tangible equity to assets at end of period 6.31% 6.93% Risk-based capital ratios: Tier 1 capital 6.78% 7.64% Total capital 10.79% 10.74% AT PERIOD END: - --------------------------------------------- Total assets $ 197,046 $ 240,001 Total earning assets 179,772 224,438 Total loans 159,732 204,964 Total deposits 148,939 181,787 Total stockholders' equity 7,514 12,936 FHLB Advances 14,783 23,337 Borrowings 17,236 19,943 Common shares outstanding 3,127,208 2,487,385
FIDELITY FEDERAL BANCORP FINANCIAL HIGHLIGHTS (DOLLARS IN THOUSANDS EXCEPT SHARE AND PER SHARE DATA)
THREE MONTHS ENDED TWELVE MONTHS ENDED EXCLUDING FOURTH QUARTER ENDED JUNE 30: 1998 1997 1998 1997 CHARGES - --------------------------------------------- ----------- ----------- ------------ --------------------------- Interest income $ 3,859 $ 5,058 $ 17,192 $ 20,282 $ 17,192 Interest expense 2,544 3,347 11,586 13,831 11,586 ----------- ----------- ------------ --------------------------- Net interest income 1,315 1,711 5,606 6,451 5,606 Provision for loan losses 20 60 11,321 975 357 Non-interest income 611 803 3,025 3,856 3,025 Non-interest expense 1,660 2,074 9,298 9,474 6,585 ----------- ----------- ------------ --------------------------- Income before income tax 246 380 (11,988) (142) 1,689 Income taxes (165) 66 (5,194) (255) 241 ----------- ----------- ------------ --------------------------- Net income $ 411 $ 314 $ (6,794) $ 113 $ 1,448 =========== =========== ============ =========================== PER SHARE: - --------------------------------------------- Basic net income $ 0.13 $ 0.13 $ (2.30) $ 0.05 0.49 Diluted net income 0.13 0.12 (2.30) 0.04 0.48 Cash dividends declared 0.05 0.10 0.35 0.60 0.35 Book value at period end 2.40 5.20 5.03 Market Price (bid) at period end 6.50 8.75 Average common and common equivalent shares outstanding 3,147,007 2,583,945 2,956,157 2,655,181 AVERAGE BALANCES: - --------------------------------------------- Total assets $ 191,769 $ 247,853 $ 216,036 $ 254,130 Total earning assets 179,107 231,680 200,451 238,438 Total loans 162,810 210,221 179,748 213,793 Total deposits 143,948 181,231 163,422 183,706 Total stockholders' equity 11,810 13,297 13,406 13,596 Federal funds purchased 436 3,648 116 1,810 FHLB Advances 17,239 26,740 19,253 33,136 Borrowings 17,199 20,585 17,673 19,664 PERFORMANCE RATIOS: - --------------------------------------------- Return on average assets 0.86% 0.51% -3.15% 0.04% 0.67% Return on average equity 13.95% 9.46% -50.68% 0.83% 10.80% Net interest margin 2.93% 2.98% 2.80% 2.72% LOAN QUALITY RATIOS: - --------------------------------------------- Net charge-offs to average loans 0.15% 0.12% 3.57% 0.12% Allowance for loan losses to total loans at end of period 4.27% 0.87% Non-performing loans to total loans 0.14% SAVING'S BANK CAPITAL RATIOS: - --------------------------------------------- Tangible equity to assets at end of period 6.41% 6.93% Risk-based capital ratios: Tier 1 capital 6.79% 7.64% Total capital 10.82% 10.74% AT PERIOD END: - --------------------------------------------- Total assets $ 190,268 $ 240,001 Total earning assets 176,633 224,438 Total loans 156,594 204,964 Total deposits 148,939 181,787 Total stockholders' equity 7,514 12,936 FHLB Advances 14,783 23,337 Borrowings 17,236 19,943 Common shares outstanding 3,127,208 2,487,385
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