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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
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| x Soliciting Material Pursuant to §240.14a-12 |
St. Francis Capital Corporation
(Name of Registrant as Specified In Its Charter)
St. Francis Capital Corporation
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
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| To Our Shareholders, |
The big news of our recently completed third quarter was, of course, the announcement of our upcoming strategic alliance with Mid America Bank, the banking subsidiary of MAF Bancorp, Inc.
First, I’d like to review our financial results for the latest quarter, which ended on June 30th. Our net income for the quarter grew by $1.4 million to $6.5 million, compared with $5.1 million for the same quarter last year. Diluted earnings per share also increased to $0.66, a $0.14 rise over the third quarter of 2002.
Based on these results, your Board of Directors declared a cash dividend in the amount of $0.20 per share, payable on August 20, 2003 to shareholders of record as of August 11, 2003.
During the past quarter, we saw a continuation of many of the trends begun in other recent quarters. The interest rate environment again played a dominant role in our results. Driven by interest rates that were the lowest they’ve been since the late 1950s, our loan originations were again very high. This gave us more loans to sell into the secondary market, resulting in total gains on the sale of mortgage loans of $5.9 million (more than double our $2.3 million in similar gains in the same period last year).
Our deposit fee income was also higher for the quarter, totaling $2.3 million, and continues to be a significant source of income. In addition, our credit quality — always a top priority — continues to be strong.
I’d like to make special note of the opening of our 23rd branch office, Oak Creek, scheduled for early September. This will expand our franchise into a new market area.
With respect to the partnership between St. Francis and Mid America Bank, this alliance is a natural fit that brings together two teams of talented and dedicated professionals, all committed to community banking and personalized customer service. As a growing institution, MAF, with 65 offices in the Chicago and Milwaukee markets, will bring more services — including Internet services — to the Milwaukee market. Our combined institution will receive a broader following by the investment community and its shares will provide increased liquidity to shareholders.
We are also confident our customers will find that Mid America Bank shares our commitment to the residents of the communities it serves, working to boost home ownership and development through community lending and involvement. To underscore that commitment, Mid America Bank has announced a new five-year community lending program designed to provide $500 million in loans to Milwaukee-area minority neighborhoods and to low- to moderate-income areas and families. This initiative is aimed at helping individuals and families achieve their dream of home ownership — and it meshes perfectly with our own belief in the importance of community lending.
This is truly an exciting time for everyone associated with St. Francis. We appreciate your continued trust, support and confidence as we enter this new era in our ongoing history of success.
Sincerely,
Thomas R. Perz
President and Chief Executive Officer
Corporate Headquarters
St. Francis Capital Corporation
13400 Bishops Lane, Suite 350
Brookfield, WI 53005
Shareholder Inquiries
Jon D. Sorenson or Susan M. Hullin: (262) 787-8700 or
E-mail: susanhullin@stfrancisbank.com
Stock Listing
St. Francis Capital Corporation common stock is traded on the NASDAQ National Market System under the symbol STFR. The Company’s stock quotes appear in The Wall Street Journal and other publications usually under St. FrancisCap or St. Francis.
| 23 Full Service Branch Locations | ||
| St. Francis | Muskego | |
| 3545 S. Kinnickinnic Avenue | S74 W17100 Janesville Road | |
| Milwaukee, Wisconsin 53235 | Muskego, Wisconsin 53150 | |
| Cudahy | National | |
| 6042 S. Packard Avenue | 10725 W. National Avenue | |
| Cudahy, Wisconsin 53110 | West Allis, Wisconsin 53227 | |
| Downtown | New Berlin | |
| 275 W. Wisconsin Avenue | 3670 S. Moorland Road | |
| Ste. 1390 | New Berlin, Wisconsin 53151 | |
| Milwaukee, Wisconsin 53203 | ||
| Oak Creek | ||
| Elmbrook | (Opening September 2003) | |
| 2360 N. 124th Street | 125 E. Puetz Rd. | |
| Wauwatosa, Wisconsin 53226 | Oak Creek, Wisconsin 53154 | |
| Germantown | Oklahoma | |
| N112 W18741 Mequon Road | 7501 W. Oklahoma Avenue | |
| Germantown, Wisconsin 53022 | Milwaukee, Wisconsin 53219 | |
| Greendale | Thiensville | |
| 5499 S. 76th Street | 153 N. Main Street | |
| Greendale, Wisconsin 53129 | Thiensville, Wisconsin 53092 | |
| Hartford | Waukesha Moreland | |
| 709 Grand Avenue | 2116 E. Moreland Blvd. | |
| Hartford, Wisconsin 53027 | Waukesha, Wisconsin 53186 | |
| Kewaskum | Waukesha Sunset | |
| 1225 Fond du Lac Avenue | 201 E. Sunset Drive | |
| Kewaskum, Wisconsin 53040 | Waukesha, Wisconsin 53186 | |
| Lake Geneva | Wauwatosa Village | |
| 401 Broad Street | 6810 W. State Street | |
| Lake Geneva, Wisconsin 53147 | Wauwatosa, Wisconsin 53213 | |
| Lisbon | West Allis | |
| 6055 W. Lisbon Avenue | 9330 W. Greenfield Avenue | |
| Milwaukee, Wisconsin | 53210 West Allis, Wisconsin 53214 | |
| Menomonee Falls | West Bend | |
| N88 W16586 Appleton Avenue | 2356 W. Washington Street | |
| Menomonee Falls, Wisconsin 53051 | West Bend, Wisconsin 53095 | |
| Morgan | ||
| 3470 S. 27th Street | ||
| Milwaukee, Wisconsin 53215 |
Our commitment
to you
Third
Quarter
Report
for the nine months ended June 30, 2003
St. Francis Capital Corporation
and Subsidiary
| Third Quarter Report for the three and nine months ended June 30, 2003 |
| (unaudited) |
| Nine months ended June 30, | Three months ended June 30, | |||||||||||||||
| Income Statement | 2003 | 2002 | 2003 | 2002 | ||||||||||||
| Interest income | $ | 79,271 | $ | 93,323 | $ | 25,196 | $ | 30,636 | ||||||||
| Interest expense | 42,600 | 51,654 | 13,435 | 16,249 | ||||||||||||
| Net interest income before provision for loan losses | 36,671 | 41,669 | 11,761 | 14,387 | ||||||||||||
| Provision for loan losses | 637 | 2,733 | 84 | 913 | ||||||||||||
| Net interest income | 36,034 | 38,936 | 11,677 | 13,474 | ||||||||||||
| Other operating income | 29,914 | 19,028 | 11,059 | 5,285 | ||||||||||||
| General and administrative expenses | 39,248 | 35,822 | 13,337 | 11,912 | ||||||||||||
| Income before income tax expense | 26,700 | 22,142 | 9,399 | 6,847 | ||||||||||||
| Income tax expense | 7,809 | 6,157 | 2,878 | 1,783 | ||||||||||||
| Net income | $ | 18,891 | $ | 15,985 | $ | 6,521 | $ | 5,064 | ||||||||
Financial Highlights | ||||||||||||||||
| Basic earnings per share | $ | 2.01 | $ | 1.73 | $ | 0.69 | $ | 0.55 | ||||||||
| Diluted earnings per share | 1.92 | 1.65 | 0.66 | 0.52 | ||||||||||||
| Return on average equity | 13.55 | % | 12.73 | % | 13.68 | % | 11.86 | % | ||||||||
| Return on average assets | 1.13 | % | 0.97 | % | 1.17 | % | 0.91 | % | ||||||||
| Net interest margin | 2.32 | % | 2.69 | % | 2.24 | % | 2.75 | % | ||||||||
| Net interest spread | 2.09 | % | 2.46 | % | 2.00 | % | 2.52 | % | ||||||||
| Other operating income to average assets | 1.79 | % | 1.16 | % | 1.99 | % | 0.95 | % | ||||||||
| G&A expenses to average assets | 2.34 | % | 2.18 | % | 2.40 | % | 2.14 | % | ||||||||
Stock Price | ||||||||||||||||
| High | $ | 29.61 | $ | 25.20 | $ | 29.61 | $ | 25.20 | ||||||||
| Low | $ | 20.88 | $ | 20.25 | $ | 22.70 | $ | 22.12 | ||||||||
| Close | $ | 29.07 | $ | 24.79 | $ | 29.07 | $ | 24.79 | ||||||||
| (Dollars in thousands, except per share data) | |||||||||||||
| June 30, | September 30, | ||||||||||||
| Financial Condition | 2003 | 2002 | |||||||||||
Assets | |||||||||||||
| Cash and cash equivalents | $ | 44,167 | $ | 45,835 | |||||||||
| Investment securities | 64,797 | 16,596 | |||||||||||
| Mortgage-backed and related securities | 629,170 | 708,826 | |||||||||||
| Loans receivable | 1,298,402 | 1,322,472 | |||||||||||
| Federal Home Loan Bank stock | 110,943 | 90,784 | |||||||||||
| Real estate held for investment | 31,650 | 32,803 | |||||||||||
| Foreclosed properties | 847 | 1,908 | |||||||||||
| Goodwill | 12,891 | 12,891 | |||||||||||
| Other assets | 61,474 | 107,002 | |||||||||||
Total Assets | $ | 2,254,341 | $ | 2,339,117 | |||||||||
Liabilities and Shareholders’ Equity | |||||||||||||
| Deposits | $ | 1,357,524 | $ | 1,416,979 | |||||||||
| Advances and other borrowings | 667,767 | 642,063 | |||||||||||
| Other liabilities | 35,072 | 100,994 | |||||||||||
| Total Liabilities | 2,060,363 | 2,160,036 | |||||||||||
| Shareholders’ equity | 193,978 | 179,081 | |||||||||||
Total Liabilities and Shareholders’ Equity | $ | 2,254,341 | $ | 2,339,117 | |||||||||
| Shareholders’ equity to total assets | 8.60 | % | 7.66 | % | |||||||||
| Book value per share | $ | 19.33 | $ | 18.31 | |||||||||
Asset Quality Information | |||||||||||||
| Non-performing loans | $ | 3,349 | $ | 2,209 | |||||||||
| Foreclosed properties | 847 | 1,908 | |||||||||||
| Non-performing assets | $ | 4,196 | $ | 4,117 | |||||||||
| Performing troubled debt restructurings | $ | 1,044 | $ | 2,440 | |||||||||
| Allowance for loan losses | $ | 14,172 | $ | 14,212 | |||||||||
| Non-performing loans to gross loans | 0.25 | % | 0.16 | % | |||||||||
| Non-performing assets to total assets | 0.19 | % | 0.18 | % | |||||||||
| Allowance for loan losses to gross loans | 1.04 | % | 1.03 | % | |||||||||
| Allowance for loan losses to non-performing loans | 423.17 | % | 643.37 | % | |||||||||