UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K/A
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): DECEMBER 1, 2003
MAF BANCORP, INC.
(Exact name of registrant as specified in its charter)
_____________________________
DELAWARE 0-18121 36-3664868
(State or other jurisdiction of (Commission File Number) (I.R.S. Employer
Incorporation) Identification No.)
55TH STREET & HOLMES AVENUE 60514
CLARENDON HILLS, ILLINOIS (Zip Code)
(Address of principal executive
offices)
Registrant's telephone number, including area code (630) 325-7300
NOT APPLICABLE
(Former name or former address, if changed since last year)
This report amends the Current Report on Form 8-K filed by MAF Bancorp,
Inc., a Delaware corporation ("MAF"), on December 3, 2003, to report the
completion of its acquisition of St. Francis Capital Corporation, a Wisconsin
corporation. The merger transaction was effective as of November 30, 2003, for
accounting purposes. As permitted under Item 7(a)(4) and as indicated in the
earlier report, this Form 8-K/A amends Item 7(b) of the previously filed Form
8-K to provide the required pro forma financial information which was not
available at the time of the earlier filing.
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
On December 1, 2003, MAF Bancorp, Inc. ("MAF") consummated its
acquisition of St. Francis Capital Corporation ("St. Francis") pursuant to the
Agreement and Plan of Reorganization, dated as of May 20, 2003, by and among MAF
and St. Francis (the "Merger Agreement"). The merger was completed through the
merger of St. Francis with and into MAF, with MAF being the surviving
corporation in the merger. Pursuant to the terms of the Merger Agreement, each
issued and outstanding share of St. Francis common stock at the effective time
of the merger has been converted into the right to receive 0.79 shares of MAF
common stock, resulting in the issuance of approximately 7.5 million shares of
MAF common stock out of MAF's treasury shares and authorized but unissued
shares. The aggregate transaction value totaled approximately $357.7 million
based on the MAF closing stock price on December 1, 2003. A copy of the press
release issued by MAF announcing the completion of the acquisition was filed as
Exhibit 99.1 to MAF Bancorp's Current Report on Form 8-K filed on December 3,
2003 and is incorporated by reference herein.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(a) Financial statements of Business Acquired.
(The required historical financial statements of St. Francis
Capital Corporation were previously included in and are
incorporated herein by reference to MAF Bancorp's Current
Report on Form 8-K filed on December 3, 2003).
(b) Pro Forma Financial Information.
The following pro forma financial statements giving effect to
the acquisition of St. Francis Capital Corporation are
included herein:
(i) Pro Forma Condensed Combined Statement of Financial
Condition as of September 30, 2003 (unaudited);
(ii) Pro Forma Condensed Combined Statement of Operations
for the nine months ended September 30, 2003
(unaudited);
(iii) Pro Forma Condensed Combined Statement of Operations
for the twelve months ended December 31, 2002 for MAF
and September 30, 2002 for Fidelity and St. Francis
(unaudited); and
(iv) Notes to unaudited Pro Forma Condensed Combined
Financial Information.
PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION
The following unaudited pro forma financial information gives pro forma
effect to MAF Bancorp's acquisition of St. Francis Capital Corporation, which
was completed on December 1, 2003, and MAF's acquisition of Fidelity Bancorp,
Inc. which was completed on July 21, 2003, using the purchase method of
accounting. The unaudited Pro Forma Condensed Combined Statement of Financial
Condition and Pro Forma Condensed Combined Statements of Operations are based
upon the historical results of MAF for the year ended December 31, 2002, and at
and for the nine months ended September 30, 2003, and of St. Francis for its
fiscal year ended September 30, 2002, and at and for the nine months ended
September 30, 2003. The ProForma Condensed Combined Statements of Operation also
reflect the historical results of Fidelity for the fiscal year ended September
30, 2002, and for the period January 1, 2003 through July 21, 2003. The Pro
Forma Condensed Combined Statement of Financial Condition assumes that the St.
Francis merger was consummated as of September 30, 2003, and the Pro Forma
Condensed Combined Statements of Operations assume that both mergers occurred at
the beginning of the periods shown. Pro forma adjustments, and the assumptions
on which they are based, are described below and in the accompanying footnotes
to the pro forma condensed combined financial statements. These financial
statements should be read in conjunction with the historical financial
statements of MAF and the historical financial statements of St. Francis
incorporated by reference into this statement. The pro forma condensed combined
financial statements are not necessarily indicative of the results that actually
would have occurred had the companies constituted a single entity during the
respective periods, nor are they indicative of MAF's future results of
operations.
The pro forma condensed combined financial statements have been
prepared using an assumed MAF stock value of $34.83, which represents a
resulting assumed purchase price of $27.52 for each share of St. Francis common
stock. The assumed MAF stock value reflects the MAF average trading price at the
time of announcement of the St. Francis acquisition, computed in accordance with
applicable accounting standards.
The pro forma condensed combined financial statements do not take into
account the following items:
o Earnings from September 30, 2003 to the actual closing date of
the St. Francis transaction.
o Estimated net expense savings to be derived in future periods
from, among other things, the termination of certain Fidelity
and St. Francis executive officers, elimination of duplicate
backroom operations and conversion to MAF's in-house data
processing system and other changes in management personnel.
o Expected revenue enhancements from implementing MAF's retail
strategy, products and services in the Fidelity and St.
Francis branches.
PRO FORMA CONDENSED COMBINED STATEMENT OF FINANCIAL CONDITION
SEPTEMBER 30, 2003
(UNAUDITED)
HISTORICAL
MAF ST. PRO FORMA PRO FORMA
BANCORP FRANCIS ADJUSTMENTS COMBINED
----------- --------- -------------- ---------
(In thousands)
ASSETS:
Cash and due from banks $ 115,308 39,739 (19,938) (Note 2) 135,109
Interest-bearing deposits 73,030 - 73,030
Federal Funds sold 77,508 735 78,243
Investment securities available for sale, at fair value 277,934 72,956 (362) (Note 3) 350,528
Stock in Federal Home Loan Bank of Chicago, at cost 265,297 112,727 378,024
Mortgage-backed securities, at amortized cost - 64,150 (90) (Note 3) 64,060
Mortgage-backed securities available for sale, at fair value 350,844 569,140 (545) (Note 3) 919,439
Loans receivable held for sale 277,792 19,634 297,426
Loans receivable 4,924,945 1,219,434 8,750 (Note 3) 6,153,129
Less: accumulated provision for loan losses 21,372 14,107 35,479
--------- --------- ------- ---------
Net loans receivable 4,903,573 1,205,327 8,750 6,117,650
Accrued interest receivable 24,774 7,451 32,225
Foreclosed real estate 520 1,102 1,622
Real estate held for development or sale 27,475 - 27,475
Premises and equipment, net 88,321 31,165 417 (Note 3) 119,903
Intangible 21,499 14,711 4,124 (Note 3) 40,334
Other Assets 71,186 40,699 12,623 (Note 4) 124,508
Goodwill 140,260 12,891 122,111 (Note 3) 262,371
(12,891) (Note 4)
--------- --------- ------- ---------
$6,715,321 2,192,427 114,199 9,021,947
========= ========= ======= =========
LIABILITIES AND STOCKHOLDERS' EQUITY:
Liabilities:
Deposits $4,263,696 1,351,543 7,529 (Note 3) 5,622,768
Borrowed funds 1,702,323 623,769 35,034 (Note 3) 2,361,126
Advances by borrowers for taxes and insurance 21,433 8,391 29,824
Accrued expenses and other liabilities 111,697 14,680 126,377
--------- --------- ------- ---------
Total Liabilities 6,099,149 1,998,383 42,563 8,140,095
--------- --------- ------- ---------
Stockholders' equity:
Preferred stock - - - -
Common Stock 260 146 (71) (Note 5) 335
Additional paid-in capital 248,091 89,897 175,708 (Note 5) 513,696
Retained earnings, substantially restricted 386,367 177,030 (177,030) (Note 5) 386,367
Accumulated other comprehensive income
(loss), net of tax 2,109 (2,267) 2,267 (Note 5) 2,109
Treasury stock, at cost (21,627) (70,762) 70,762 (Note 5) (21,627)
Stock in gain deferral plan 972 - 972
--------- --------- ------- ---------
Total stockholders' equity 616,172 194,044 71,636 881,852
--------- --------- ------- ---------
$6,715,321 2,192,427 114,199 9,021,947
========= ========= ======= =========
See accompanying notes to unaudited Pro Forma
Condensed Combined Financial Information.
PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
NINE MONTHS ENDED SEPTEMBER 30, 2003
(UNAUDITED)
MAF FIDELITY PRO FORMA PRO FORMA ST. PRO FORMA PRO FORMA
BANCORP BANCORP* ADJUSTMENTS COMBINED FRANCIS ADJUSTMENTS COMBINED
------- -------- ----------- --------- ------- ----------- ---------
(Dollars in thousands, except per share amounts)
INTEREST INCOME:
Loans receivable $ 199,211 13,981 (1,009) (Note 3) 212,183 56,480 (2,242) (Note 3) 266,421
Mortgage-backed securities 9,415 4,720 (739) (Note 3) 13,396 12,929 (252) (Note 3) 26,073
Investment securities and other 20,485 1,727 (241) (Note 2,3) 21,971 5,680 (547) (Note 2,3) 27,104
---------- --------- ------ ---------- --------- ------- ----------
229,111 20,428 (1,989) 247,550 75,089 (3,041) 319,598
INTEREST EXPENSE:
Deposits 46,327 6,017 (1,909) (Note 3) 50,435 18,481 (4,177) (Note 3) 64,739
Borrowed funds 56,258 6,904 (1,531) (Note 3) 61,631 22,135 (10,666) (Note 3) 73,100
---------- --------- ------ ---------- --------- ------- ----------
Total interest expense 102,585 12,921 (3,440) 112,066 40,616 (14,843) 137,839
---------- --------- ------ ---------- --------- ------- ----------
Net interest income 126,526 7,507 1,451 135,484 34,473 11,802 181,759
Provision for loan losses - 125 125 281 406
---------- --------- ------ ---------- --------- ------- ----------
Net interest income after provision 126,526 7,382 1,451 135,359 34,192 11,802 181,353
NON-INTEREST INCOME:
Gain (loss) on sale of:
Loans receivable 22,940 41 22,981 14,373 37,354
Investment and MBS (946) 867 (79) 2,406 2,327
Income from real estate operations 6,332 - 6,332 2,777 9,109
Deposit account service charges 17,450 152 17,602 6,307 23,909
Loan servicing fee income (6,056) 114 (5,942) 4,252 (1,690)
Impairment of mortgage servicing rights (940) - (940) (1,025) (1,965)
Brokerage commissions 2,361 344 2,705 1,179 3,884
Other 8,870 3,363 12,233 240 12,473
---------- --------- ------ ---------- --------- ------- ----------
Total non interest income 50,011 4,881 54,892 30,509 85,401
NON INTEREST EXPENSE:
Compensation and benefits 48,426 4,793 53,219 22,593 75,812
Office occupancy and equipment 10,701 1,112 11,813 6,999 88 (Note 3) 18,900
Federal deposit insurance premiums 502 - 502 168 670
Advertising and promotion 4,798 208 5,006 542 5,548
Data processing 3,001 269 3,270 717 3,987
Amortization of intangibles 1,170 - 202 (Note 3) 1,372 34 970 (Note 3) 2,376
Other 14,230 2,588 16,818 8,028 24,846
---------- --------- ------ ---------- --------- ------- ----------
Total non interest expense 82,828 8,970 202 92,000 39,081 1,058 132,139
---------- --------- ------ ---------- --------- ------- ----------
Income before income taxes 93,709 3,293 1,249 98,251 25,620 10,744 134,615
Income taxes 34,376 564 462 35,402 7,418 3,975 46,795
---------- --------- ------ ---------- --------- ------- ----------
Net income $ 59,333 2,729 787 62,849 18,202 6,769 87,820
========== ========= ====== ========== ========= ======= ==========
EARNINGS PER SHARE (NOTE 6):
Basic $ 2.48 0.86 2.35 1.93 2.57
========== ========= ========== ========= ==========
Diluted $ 2.42 0.84 2.30 1.83 2.48
========== ========= ========== ========= ==========
WEIGHTED-AVERAGE SHARES OUTSTANDING
(NOTE 6):
Basic 23,909,848 3,155,844 26,736,119 9,429,079 34,225,162
========== ========= ========== ========= ==========
Diluted 24,511,581 3,256,369 27,346,740 9,920,519 35,409,386
========== ========= ========== ========= ==========
<FN>
- --------------
* for January 1, 2003 through July 21, 2003
</FN>
See accompanying notes to unaudited Pro Forma
Condensed Combined Financial Information.
PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
TWELVE MONTHS ENDED DECEMBER 31, 2002 FOR MAF AND
SEPTEMBER 30, 2002 FOR FIDELITY AND ST. FRANCIS
(UNAUDITED)
MAF FIDELITY PRO FORMA PRO FORMA ST. PRO FORMA PRO FORMA
BANCORP BANCORP ADJUSTMENTS COMBINED FRANCIS ADJUSTMENTS COMBINED
------- -------- ----------- --------- ------- ----------- ---------
(Dollars in thousands, except per share amounts)
INTEREST INCOME:
Loans receivable $ 288,790 31,269 (1,293) (Note 3) 318,766 87,901 (2,860) (Note 3) 403,807
Mortgage-backed securities 11,295 8,787 (958) (Note 3) 19,124 29,955 (336) (Note 3) 48,743
Investment securities and other 29,405 3,784 (321) (Note 2,3) 32,868 5,289 (730) (Note 2,3) 37,427
---------- --------- ------ ---------- --------- ------- ----------
329,490 43,840 (2,572) 370,758 123,145 (3,926) 489,977
INTEREST EXPENSE:
Deposits 90,963 13,656 (2,027) (Note 3) 102,592 36,287 (4,739) (Note 3) 134,140
Borrowed funds 80,502 8,586 (1,915) (Note 3) 87,173 31,132 (14,220) (Note 3) 104,085
---------- --------- ------ ---------- --------- ------- ----------
Total interest expense 171,465 22,242 (3,942) 189,765 67,419 (18,959) 238,225
---------- --------- ------ ---------- --------- ------- ----------
Net interest income 158,025 21,598 1,370 180,993 55,726 15,033 251,752
Provision for loan losses 300 600 900 3,289 4,189
---------- --------- ------ ---------- --------- ------- ----------
Net interest income after
provision 157,725 20,998 1,370 180,093 52,437 15,033 247,563
NON-INTEREST INCOME:
Gain (loss) on sale of:
Loans receivable 16,330 690 17,020 12,751 29,771
Investment and MBS 119 1,122 1,241 1,312 2,553
Income from real estate operations 9,717 - 9,717 3,190 12,907
Deposit account service charges 22,239 281 22,520 5,586 28,106
Loan servicing fee income (4,772) 389 (4,383) 1,182 (3,201)
Brokerage commissions 2,702 863 3,565 1,556 5,121
Other 10,028 41 10,069 819 10,888
---------- --------- ------ ---------- --------- ------- ----------
Total non interest income 56,363 3,386 59,749 26,396 86,145
NON INTEREST EXPENSE:
Compensation and benefits 59,098 6,544 65,642 27,349 92,991
Office occupancy and equipment 11,670 1,993 13,663 8,781 118 (Note 3) 22,562
Federal deposit insurance premiums 4,844 - 4,844 254 5,098
Advertising and promotion 667 550 1,217 957 2,174
Data processing 3,655 498 4,153 1,735 5,888
Amortization of intangibles 1,649 - 269 (Note 3) 1,918 - 1,292 (Note 3) 3,210
Other 17,759 2,112 19,871 9,018 28,889
---------- --------- ------ ---------- --------- ------- ----------
Total non interest expense 99,342 11,697 269 111,308 48,094 1,410 160,812
---------- --------- ------ ---------- --------- ------- ----------
Income before income taxes 114,746 12,687 1,101 128,534 30,739 13,623 172,896
Income taxes 40,775 4,684 407 45,866 8,867 5,041 59,774
---------- --------- ------ ---------- --------- ------- ----------
Net income $ 73,971 8,003 694 82,668 21,872 8,582 113,122
========== ========= ====== ========== ========= ======= ==========
EARNINGS PER SHARE (NOTE 6):
Basic $ 3.19 2.61 3.18 2.36 3.38
========== ========= ========== ========= ==========
Diluted $ 3.11 2.49 3.11 2.25 3.29
========== ========= ========== ========= ==========
WEIGHTED-AVERAGE SHARES OUTSTANDING
(NOTE 6):
Basic 23,162,422 3,069,172 25,988,693 9,262,052 33,477,736
========== ========= ========== ========= ==========
Diluted 23,748,411 3,211,814 26,583,350 9,727,091 34,374,836
========== ========= ========== ========= ==========
See accompanying notes to unaudited Pro Forma
Condensed Combined Financial Information.
NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION
Note 1: Basis of Presentation
The mergers are being accounted for by MAF using the purchase method of
accounting in accordance with Statement of Financial Accounting Standards No.
141, "Business Combinations" ("SFAS No. 141"). Under this method, the aggregate
cost of the merger will be allocated to assets acquired and liabilities assumed
based on their estimated fair values as of the closing date. The unaudited Pro
Forma Condensed Combined Statement of Financial Condition at September 30, 2003
is based on the unaudited consolidated statements of financial condition of MAF
and subsidiaries and of St. Francis and subsidiaries, adjusted for the impact of
SFAS No. 141. For purposes of pro forma presentation, St. Francis' assets and
liabilities as of September 30, 2003, adjusted to give effect to fair value
adjustments reflecting estimated fair values as of the closing date, have been
combined with the book values of MAF's assets and liabilities as of September
30, 2003.
The unaudited Pro Forma Condensed Combined Statement of Operations for
the year ended December 31, 2002, is based on the audited consolidated financial
statements of MAF and subsidiaries for the year ended December 31, 2002, and the
audited consolidated financial statements for St. Francis and subsidiaries
and of Fidelity and subsidiaries for their fiscal year ended September 30, 2002,
adjusted for the impact of SFAS No. 141, assuming the mergers occurred on
January 1, 2002. The unaudited Pro Forma Condensed Combined Statement of
Operations for the nine-month period ended September 30, 2003, is based on the
unaudited consolidated statements of operations of MAF and subsidiaries,
Fidelity and subsidiaries (through July 21, 2003, Fidelity's date of
acquisition), and St. Francis and subsidiaries, adjusted for the impact of SFAS
No. 141, assuming the mergers occurred on January 1, 2003.
Certain amounts in the historical financial statements of St. Francis
and Fidelity have been reclassified and adjusted to conform to MAF's historical
financial statement presentation.
Note 2: Cash and Due from Banks
As part of the St. Francis transaction, MAF expects to incur
approximately $11.9 million in transaction costs, primarily for professional
expenses, change in control benefits and severance payments to certain
employees, data processing contract termination, printing and other expenses. In
addition, MAF incurred $16.2 million related to the cash out of St. Francis
options that otherwise would have been converted to options to purchase 676,820
shares of MAF. As part of the Fidelity transaction, MAF expects to incur
approximately $3.7 million in transaction costs. MAF incurred $3.2 million
related to the cash-out of Fidelity options that otherwise would have been
converted to 116,876 shares of MAF.
Interest income on investment securities in the unaudited Pro Forma
Condensed Combined Statements of Operations is reduced by $598,000 for the nine
months ended September 30, 2003, and by $798,000 for the year ended December 31,
2002, to reflect the reduction in cash of $19.9 million assumed to be invested
at an average interest rate of 4.00% for the St. Francis transaction.
Interest income on investment securities in the unaudited Pro Forma
Condensed Combined Statements of Operations is reduced by $207,000 for the nine
months ended September 30, 2003, and by $276,000 for the year ended December 31,
2002, to reflect the reduction in cash of $6.9 million assumed to be invested at
an average interest rate of 4.00% for the Fidelity transaction.
NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION, CONTINUED
Note 3: Allocation of Purchase Accounting Adjustments
In accordance with SFAS No. 142, intangible assets acquired that can be
separately identified shall be assigned a portion of the total cost of the
acquired company if the fair values of those assets can be reliably determined.
Any identified intangible shall be recorded as the cost of the intangible and
amortized over its estimated life.
The following table provides a reconciliation of the excess cost of the
St. Francis merger to MAF (based on estimated value of the merger consideration
assuming an MAF common stock value of $34.83 per share) over the estimated fair
value of net assets, assumed to have been acquired from St. Francis on
September 30, 2003 (in thousands except share and option data):
MAF stock to be issued (7,489,043 shares)............... $260,837
Value of St. Francis vested carryover options converted into
346,654 MAF options, net of $729 of tax benefits..... 4,113
Cash paid to cancel St. Francis options, net of $5,616 of tax
benefits............................................. 10,539
Transaction costs, net of tax........................... 9,397
--------
284,886
--------
Less:
Stockholders' equity of St. Francis.................. 194,044
Purchase accounting adjustments, net................. (20,396)
Elimination of existing goodwill..................... (12,891)
Elimination of existing core deposit intangible...... (249)
Accumulated other income, net of tax................. 2,267
--------
Cost in excess of fair value of net assets
acquired........................................ $122,111
========
In connection with the St. Francis transaction, MAF will record fair
value adjustments based on the estimated fair values as of the closing date, for
investment securities, mortgage-backed securities, loans receivable, premises,
core deposit accounts, mortgage servicing rights, certificates of deposit and
other borrowings of St. Francis. A summary of the fair value adjustments
relating to the assets acquired and liabilities assumed of St. Francis is
presented below (in thousands):
Mortgage-backed securities.............................. $ (4,395)
Investments............................................. (163)
Loans receivable........................................ 8,750
Premises................................................ 417
Mortgage servicing rights............................... (2,375)
Core deposit intangible................................. 6,907
Certificates of deposit................................. (7,529)
Borrowings.............................................. (35,034)
Deferred tax asset...................................... 13,026
--------
Total purchase accounting adjustments, net........... $(20,396)
========
NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION, CONTINUED
In connection with the Fidelity transaction, MAF will record fair value
adjustments based on the estimated fair values as of the closing date, for
investment securities, mortgage-backed securities, loans receivable, premises,
core deposit accounts, certificates of deposit and other borrowings of Fidelity.
A summary of the fair value adjustments relating to the assets acquired and
liabilities assumed of St. Francis is presented below (in thousands):
Mortgage-backed securities.............................. $ (3,171)
Investments............................................. (56)
Loans receivable........................................ 2,320
Premises................................................ (2,702)
Core deposit intangible................................. 1,575
Certificates of deposit................................. (2,261)
Borrowings.............................................. (1,915)
Deferred tax asset...................................... 323
--------
Total purchase accounting adjustments, net........... $ (5,887)
========
Interest income on loans receivable in the unaudited Pro Forma
Condensed Combined Statements of Operations for the nine months ended September
30, 2003, and the year ended December 31, 2002, is reduced by $1.0 million and
$1.3 million, respectively, for the Fidelity acquisition and by $2.2 million and
$2.9 million, respectively, for the St. Francis acquisition. These pro forma
adjustments reflect amortization of the premiums calculated based on the
estimated fair values of loans receivable acquired using the level-yield method
over an estimated average life of five years for Fidelity and three years for
St. Francis. Interest income on mortgage-backed securities in the unaudited Pro
Forma Condensed Combined Statements of Operations for the nine months ended
September 30, 2003, and the year ended December 31, 2002, is reduced by $739,000
and $958,000, respectively, for the Fidelity acquisition and by $252,000 and
$336,000, respectively, for the St. Francis acquisition. These pro forma
adjustments reflect amortization of the premiums calculated based on the fair
values of the mortgage-backed securities acquired using the level yield method
over an estimated life of four years for Fidelity and 2.5 years for St. Francis.
Interest income on investment securities in the unaudited Pro Forma
Condensed Combined Statements of Operations for the nine months ended September
30, 2003, and the year ended December 31, 2002, is reduced by $34,000 and
$45,000, respectively, for the Fidelity acquisition and increased by $51,000 and
$68,000, respectively, for the St. Francis acquisition. These pro forma
adjustments reflect amortization of the discounts/premiums calculated based on
the fair values of the investment securities acquired using the level yield
method over an estimated life of four years for Fidelity and three years for St.
Francis.
Interest expense on deposits in the unaudited Pro Forma Condensed
Combined Statements of Operations for the nine months ended September 30, 2003,
and the year ended December 31, 2002, is reduced by $1.9 million and $2.0
million, respectively, for the Fidelity acquisition and by $4.2 million and $4.7
million, respectively, for the St. Francis acquisition. These pro forma
adjustments reflect amortization of the premiums calculated based on the
estimated fair values of certificates of deposit assumed using the level-yield
method over an estimated average life of seven months for Fidelity and 14 months
for St. Francis.
NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION, CONTINUED
Interest expense on borrowings in the unaudited Pro Forma Condensed
Combined Statements of Operations for the nine months ended September 30, 2003,
and the year ended December 31, 2002, is reduced by $1.5 million and $1.9
million, respectively, for the Fidelity acquisition, and by $10.7 million and
$14.2 million respectively, for the St. Francis acquisition. These pro forma
adjustments reflect amortization of the premiums calculated based on the
estimated fair values of borrowings assumed using the level-yield method over an
estimated average life of 12 months for Fidelity and 38 months for St. Francis.
Depreciation of office occupancy and equipment expense in the unaudited
Pro Forma Condensed Combined Statements of Operations for the nine months ended
September 30, 2003 and the year ended December 31, 2002, is increased by $88,000
and $118,000, respectively, for the St. Francis acquisition to reflect
depreciation over the remaining life of the buildings.
Amortization of core deposit intangibles expense in the unaudited Pro
Forma Condensed Combined Statements of Operations for the nine months ended
September 30, 2003 and the year ended December 31, 2002, is increased by
$202,000 and $269,000, respectively, for the Fidelity acquisition, and by
$970,000 and $1.3 million, respectively, for the St. Francis acquisition to
reflect amortization of the additional core deposit intangibles on an
accelerated basis over 10 years.
Note 4: Other Assets
The Pro Forma Combined Statement of Financial Condition as of September
30, 2003, includes adjustments to other assets as follows:
o For the St. Francis acquisition, a $12.6 million increase in
other assets for the tax impact of purchase accounting
adjustments, the reversal of SFAS No. 115 mark-to-market
entries on mortgage-backed and investment securities, and tax
benefits related to carryover options and cashed out options.
The Pro Forma Combined Statement of Financial Condition as of September
30, 2003, includes the elimination of $12.9 million and $408,000, respectively
of existing goodwill and core deposit intangibles at St. Francis.
Note 5: Stockholders' Equity
The St. Francis merger resulted in the issuance of an additional
7,489,043 shares of MAF common stock, and 346,654 shares of MAF common stock
became subject to issuance upon the exercise of 438,865 St. Francis carryover
stock options.
The following table details the adjustments to stockholders' equity as
of September 30, 2003, to reflect the issuance of 7,489,043 shares of common
stock in the St. Francis acquisition and the value of the St. Francis carryover
options, at the assumed value of $34.83 per share of MAF common stock, in the
unaudited Pro Forma Condensed Combined Statement of Financial Condition (in
thousands):
NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION, CONTINUED
ACCUMU-
LATED
OTHER
COMPRE-
COMMON PAID-IN RETAINED HENSIVE TREASURY
STOCK CAPITAL EARNINGS INCOME STOCK
------ --------- ---------- ------- --------
Elimination of St. Francis's
stockholders' equity............. $(146) $(89,897) $(177,030) $2,267 $70,762
Issuance of MAF stock............... 75 260,762 - - -
Value of St. Francis carryover
options.......................... - 4,843 - - -
----- -------- --------- ------ -------
Total pro forma adjustments...... $ (71) $175,708 $(177,030) $2,267 $70,762
===== ======== ========= ====== =======
Note 6: Earnings Per Share
Basic earnings per share in the Pro Forma Combined Condensed Statements
of Operations were computed by dividing pro forma net income by the total
average shares outstanding for the period, assuming the issuance of an aggregate
of 10,315,152 shares of MAF common stock in the two transactions, and the
elimination of the Fidelity and St. Francis average shares outstanding, as of
the beginning of the respective periods. In the Fidelity transaction, MAF issued
a total of 2,826,109 shares of common stock and 20,632 shares of MAF common
stock became subject to issuance upon exercise of Fidelity carryover options.
Diluted earnings per share in the Pro Forma Combined Condensed
Statements of Operations were computed by dividing pro forma net income by the
total average shares outstanding for the period, assuming the issuance of
10,315,152 shares of MAF common stock plus the dilutive effect of carryover
stock options and the elimination of the Fidelity and St. Francis average shares
outstanding, as of the beginning of the respective periods. The dilutive effect
of outstanding stock options was computed using the average market price of MAF
Common Stock for the period.
Note 7: Quarter Ended December 31, 2002 results for Fidelity and St. Francis
In accordance with Regulation S-X, the pro forma results detailed above
do not include the results for Fidelity and St. Francis for the three months
ended December 31, 2002 because their fiscal year ends are September 30, which
differs from the December 31 year end of MAF.
Total assets of Fidelity at December 31, 2002, were $729.9 million
including loans receivable of $401.8 million. Total deposits were $463.3
million. Net income for the three months ended December 31, 2002, was $1.9
million and basic and diluted earnings per share were $.61 and $.58,
respectively.
Total assets of St. Francis at December 31, 2002, were $2.23 billion
including loans receivable of $1.22 billion. Total deposits were $1.40 billion.
Net income for the three months ended December 31, 2002, was $6.1 million and
basic and diluted earnings per share were $.65 and $.62, respectively.
(c) Exhibits:
2.1 Agreement and Plan of Reorganization by and among MAF Bancorp,
Inc. and St. Francis Capital Corporation dated as of May 20,
2003 (Incorporated herein by reference to Exhibit 2.1 to MAF
Bancorp, Inc.'s Current Report on Form 8-K filed on May 21,
2003).
23.1 Consent of KPMG LLP (Incorporated herein by reference to
Exhibit 23.1 to MAF Bancorp, Inc.'s Current Report on Form 8-K
filed on December 3, 2003).
99.1 Press Release dated December 1, 2003 (Incorporated herein by
reference to Exhibit 99.1 to MAF Bancorp, Inc.'s Current
Report on Form 8-K filed on December 3, 2003).
SIGNATURE
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.
MAF BANCORP, INC.
By: /s/ Jerry A. Weberling
--------------------------------
Jerry A. Weberling
Executive Vice President and
Chief Financial Officer
Date: January 27, 2004
INDEX TO EXHIBITS
-----------------
Exhibit
- -------
Exhibit 2.1 Agreement and Plan of Reorganization by and among MAF Bancorp,
Inc. and St. Francis Capital Corporation dated as of May 20,
2003 (Incorporated herein by reference to Exhibit 2.1 to MAF
Bancorp, Inc.'s Current Report on Form 8-K filed on May 21,
2003).
Exhibit 23.1 Consent of KPMG LLP (Incorporated herein by reference to
Exhibit 23.1 to MAF Bancorp, Inc.'s Current Report on Form 8-K
filed on December 3, 2003).
Exhibit 99.1 Press Release dated December 1, 2003 (Incorporated herein by
reference to Exhibit 99.1 to MAF Bancorp, Inc.'s Current
Report on Form 8-K filed on December 3, 2003).