SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
ANNUAL REPORT
PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934 [NO FEE REQUIRED, EFFECTIVE OCTOBER 7, 1996].
For the fiscal year ended June 30, 2007
-----------------------------------------------
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934 [NO FEE REQUIRED].
For the transition period from _______________ to ______________________
Commission File Number 000-50592
A. Full title of the plan and the address of the plan, if different from
that of the issuer named below:
Kaiser Federal Bank Employees' Savings & Profit Sharing Plan and Trust
B: Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
K-Fed Bancorp
1359 N. Grand Avenue
Covina, California 91724-1016
Kaiser Federal Bank
Employees' Savings and Profit Sharing Plan
Financial Statements
June 30, 2007 and 2006
TABLE OF CONTENTS
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM........................1
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS................................2
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS......................3
NOTES TO FINANCIAL STATEMENTS..................................................4
SCHEDULE H, LINE 4(i) - SCHEDULE OF ASSETS (HELD AT END OF YEAR)...............9
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Plan Administrator of
Kaiser Federal Bank Employees'
Savings and Profit Sharing Plan
Covina, California
We have audited the accompanying statements of net assets available for benefits
of Kaiser Federal Bank Employees' Savings and Profit Sharing Plan ("the Plan")
as of June 30, 2007 and 2006, and the related statement of changes in net assets
available for benefits for the year ended June 30, 2007. These financial
statements are the responsibility of the Plan's management. Our responsibility
is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for benefits of the Plan as of
June 30, 2007 and 2006, and the changes in net assets available for benefits for
the year ended June 30, 2007 in conformity with U.S. generally accepted
accounting principles.
Our audit was conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule of assets (held
at end of year), is presented for the purpose of additional analysis and is not
a required part of the basic financial statements but is supplementary
information required by the Department of Labor's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement Income Security Act of
1974. The supplemental schedule is the responsibility of the Plan's management.
The supplemental schedule has been subjected to the auditing procedures applied
in the audit of the basic 2007 financial statements and, in our opinion, is
fairly stated in all material respects in relation to the basic 2007 financial
statements taken as a whole.
/s/ Crowe Chizek and Company LLP
--------------------------------
Crowe Chizek and Company LLP
Oak Brook, Illinois
April 11, 2008
KAISER FEDERAL BANK
EMPLOYEES' SAVINGS AND PROFIT SHARING PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
JUNE 30, 2007 AND 2006
- ------------------------------------------------------------------------------------------------------------------
2007 2006
---------------------- -------------------
Assets:
Investments, participant directed, at fair value $ 4,134,640 $ 3,612,675
Loans receivable 91,564 84,873
---------------------- -------------------
4,226,204 3,697,548
---------------------- -------------------
Accrued income 203 120
---------------------- -------------------
Total assets 4,226,407 3,697,668
---------------------- -------------------
Liabilities:
Accrued expenses 520 1,581
---------------------- -------------------
Net Assets Available for Benefits $ 4,225,887 $ 3,696,087
====================== ===================
The accompanying notes are an integral part of these statements. 2
KAISER FEDERAL BANK
EMPLOYEES' SAVINGS AND PROFIT SHARING PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED JUNE 30, 2007
- -------------------------------------------------------------------------------------------------------------------
Additions to net assets attributable to:
Income:
Net appreciation in fair value of investments $ 368,709
Interest and dividends on investments 44,992
Interest from participant loans 5,070
---------------------
418,771
Contributions:
Employee 356,771
Employer 115,573
Rollovers 9,220
---------------------
481,564
---------------------
Total additions 900,335
Deductions to net assets attributable to:
Benefits paid to participants 331,398
Administrative expenses 35,435
Other 3,702
---------------------
Total deductions 370,535
---------------------
Net increase 529,800
Net Assets Available for Benefits:
Beginning of year 3,696,087
---------------------
End of year $ 4,225,887
=====================
The accompanying notes are an integral part of this statement. 3
KAISER FEDERAL BANK
EMPLOYEES' SAVINGS AND PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
1. DESCRIPTION OF PLAN
-------------------
The following brief description of the Kaiser Federal Bank Employees'
Savings and Profit Sharing Plan (the "Plan") is provided for general
information purposes only. Participants should refer to the Plan document
for a more complete description of the Plan's provisions. The Plan was
amended in its entirety effective January 1, 2001.
General: The Plan is a voluntary defined contribution plan for all eligible
employees of Kaiser Federal Bank (the "Bank"), who meet the minimum age
requirement specified in the Plan agreement. The Plan is subject to the
provisions of the Employee Retirement Income Security Act of 1974 (ERISA).
Contributions: The Plan allows participants to contribute up to a maximum
of 15% of their compensation, as defined in the Plan. Participants may also
contribute amounts representing distributions from other qualified defined
benefit or defined contribution plans. The Bank contributes a discretionary
matching contribution equal to 50% of the first 10% of an employee's
compensation. Additional profit sharing amounts may be contributed at the
option of the Bank's Board of Directors. The Plan did not make any profit
sharing contributions for the year ended June 30, 2007.
Participant Accounts: Each participant's account is credited with the
participant's contribution and the Bank's matching and profit sharing
contribution. Plan earnings are allocated based on participant account
balances, as defined. The benefit to which a participant is entitled is the
benefit that can be provided from the participant's vested account.
Vesting: Participants are immediately vested in their voluntary
contributions plus actual earnings thereon. Vesting in the Bank
contributions portion of their accounts plus earnings thereon is based on
years of continuous service. A participant is 100 percent vested after six
years of credited service.
Payment of Benefits: Upon termination of service due to death, disability
or retirement from the Bank, a participant may elect to receive the vested
interest of their account in the form of an annuity, a single sum cash
payment, or a combination of the above. Active participants may also take
distributions from the Plan for reasons of financial hardship or upon
attainment of the age of 59 1/2. In-service withdrawals are subject to
certain limitations.
Forfeitures: At June 30, 2007 and 2006 forfeited nonvested accounts totaled
$12,230 and $2,242, respectively. These amounts will be used to either
reduce employer-matching contributions or allocated to all eligible
employees. For the year ended June 30, 2007, employer contributions were
reduced by $2,262 from forfeited nonvested accounts.
Investment Options: Participants must direct both employee and employer
contributions to be invested amongst various investment options as made
available and determined by the plan administrator which are more fully
described in the plan literature. Participants may change their investment
options any time throughout the year via direct phone or Internet access to
Pentegra Retirement Service.
4
KAISER FEDERAL BANK
EMPLOYEES' SAVINGS AND PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
Participant Loans: Participants may borrow from their fund accounts a
minimum of $1,000 up to a maximum equal to the lesser of $50,000 or fifty
percent of their vested account balance. The loans are secured by the
balance in the participant's account and bear interest at a rate of the
Prime Rate plus 1%, which is commensurate with local prevailing rates. Loan
terms may range from one to five years or longer if used to purchase the
primary residence of the participant. Principal and interest are paid
ratably through payroll deductions.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
------------------------------------------
Accounting records: The accounting records of the Plan are maintained, with
respect to Plan administration by Pentegra Retirement Service and with
respect to investment transactions by the Bank of New York.
Basis of Accounting: The financial statements of the Plan are prepared
using the accrual method of accounting.
Adoption of New Accounting Standard: The Plan retroactively adopted
Financial Accounting Standards Board (FASB) Staff Position AAG INV-1 and
SOP 94-4-1, Reporting of Fully Benefit-Responsive Investment Contracts Held
by the Certain Investment Companies Subject to the AICPA Investment Company
Guide and Defined-Contribution Health and Welfare and Pension Plans ("the
FSP") in 2007. Pursuant to the adoption of the FSP, fully
benefit-responsive investment contracts held directly by the Plan or
included in the underlying investments of common collective trust funds in
which the Plan holds an interest are to be presented at fair value. In
addition, any material difference between the fair value of these
investments and their contract value is to be presented as a separate
adjustment line in the statement of net assets available for benefits,
because contract value remains the relevant measurement attribute for that
portion of net assets available for benefits attributable to fully
benefit-responsive investment contracts. Accordingly, the adoption of the
FSP had no impact on the net assets available for benefits as of June 30,
2007 or 2006. The net appreciation (depreciation) reported in the Plan's
statement of changes in net assets available for benefits has not been
impacted by the adoption of the FSP either, as the amount reflects the
contract value of fully benefit-responsive contracts held directly or
indirectly by the Plan.
Management has determined that the estimated fair value of the Plan's
indirect investments in fully benefit-responsive contracts as of June 30,
2007 and 2006 approximates contract value, and any difference between fair
value and contract value is immaterial. As a result, the adoption of the
FSP would have no material impact on the statements of net assets available
for benefit as of June 30, 2007 and 2006. Accordingly, management
determined that no adjustment will be made as a result of adoption of the
FSP.
Investment Valuation and Income Recognition: The Plan's investments are
stated at fair value. Investments in publicly-traded securities (Kaiser
Federal Bancorp common stock) are carried at published market values. The
fair values of the Plan's interests in common collective trust funds, other
than stable value funds, are based upon the net asset values of the funds
as reported by the fund managers. The fair values of the Plan's interests
in stable value funds are based upon the net asset values of such funds
reflecting all investments at fair value, including direct and indirect
interests in fully benefit-responsive contracts, as reported by the fund
managers. Participant loans are reported at their outstanding balances,
which approximates fair value.
5
KAISER FEDERAL BANK
EMPLOYEES' SAVINGS AND PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
Purchases and sales of securities are recorded on a trade-date basis.
Interest income is recorded on the accrual basis. Dividends are recorded on
the ex-dividend date.
Payment of Benefits: Benefits are recorded when paid.
Excess Contributions: Refunds of excess participant deferral contributions
may be required to satisfy the relevant nondiscrimination provisions of the
Plan. Such refunds are accrued as a liability and reduction in
contributions in the Plan year in which the excess deferrals were made to
the Plan.
Estimates: The preparation of financial statements in conformity with
accounting principles generally accepted in the United States of America
requires the plan administrator to make estimates and assumptions that
affect certain reported amounts and disclosures, and actual results may
differ from these estimates.
Risks and Uncertainties: The Plan invests in various investment securities.
Investment securities are exposed to various risks such as interest rate,
market and credit risks. Due to the level of risk associated with certain
investment securities, it is at least reasonably possible that changes in
the values of investment securities will occur in the near term and that
such changes could materially affect participants' account balances and the
amounts reported in the statement of net assets available for benefits.
3. INVESTMENTS
-----------
The following presents the fair values of investments that represent 5
percent or more of the Plan's net assets.
June 30
-------------------------------------------------
2007 2006
------------------------ -----------------------
K-Fed Corporation Stock $ 1,284,352 $ 934,228
State Street Global Advisors Common Collective Trust
Funds:
SSgA - Stable Value 350,165 403,729
SSgA - Moderate Strategic Balanced 292,673 237,210
SSgA - S & P 500 239,467 188,170
SSgA - Midcap Fund 460,262 515,291
SSgA - Money Market 300,904 234,437
6
KAISER FEDERAL BANK
EMPLOYEES' SAVINGS AND PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
The Plan's investments (including gains and losses on investments bought
and sold, as well as held during the year) appreciated in value as follows:
Year Ended June 30,
2007
------------------------
K-Fed Corporation Stock $ 22,816
State Street Global Advisors Common
Collective Trust Funds 345,893
------------------------
$ 368,709
========================
In addition, the Plan earned dividend and interest income of $50,062 for
the year ended June 30, 2007.
4. PARTY-IN-INTEREST TRANSACTIONS
------------------------------
Parties in interest are defined under Department of Labor regulations as
any fiduciary of the Plan, any party rendering service to the Plan, the
employer, and certain others. The Plan allows participants to invest their
account balances in shares of Kaiser Federal Bancorp. The number of shares
of Bank common stock held by the Plan at June 30, 2007 and 2006 was 81,858
shares and 64,474 shares, respectively. The fair value of these shares at
June 30, 2007 and 2006 was $1,284,352 and $934,228 respectively. An annual
cash dividend of 0.39 and 0.28 dollars per share of common stock
outstanding was paid during the year ended June 30, 2007 and 2006,
respectively. These transactions also qualify as party-in-interest
transactions.
The Plan also allows participants to take loans from their accounts in the
Plan. These investments also qualify as party-in-interest and totaled
$91,564 and $84,873 at June 30, 2007 and 2006, respectively.
Certain administrative functions are performed by officers or employees of
the Bank. No such officer or employee receives compensation from the Plan.
Some administrative expenses of the Plan are paid directly by the Bank.
5. PLAN TERMINATION
----------------
Although it has not expressed any intent to do so, the Bank has the right
under the Plan to discontinue its contributions at any time and to
terminate the Plan subject to the provisions of ERISA. In the event of plan
termination, participants will become 100% vested in their accounts.
7
KAISER FEDERAL BANK
EMPLOYEES' SAVINGS AND PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
6. TAX STATUS
----------
The Plan is a standard prototype plan provided by Pentegra Retirement
Service. Pentegra Retirement Service, the Plan's service provider, has
applied for, but not yet received, a determination letter. Although the
prototype plan has not yet received a favorable deterimination letter, the
Plan administrator believes that the Plan is designed and is currently
being operated in compliance with the applicable requirements of the IRC.
8
SUPPLEMENTAL SCHEDULE
KAISER FEDERAL BANK
EMPLOYEES' SAVINGS AND PROFIT SHARING PLAN
SCHEDULE H, LINE 4(i) - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AT END OF YEAR
JUNE 30, 2007
SPONSOR FEDERAL I.D. #95-1867697 (PLAN 002)
- -------------------------------------------------------------------------------------------------------------------
(c) (d)
(a) (b) Description of Investment, Including Maturity
Identity of Issuer, Borrower, Date, Rate of Interest, Collateral, Par, or (e)
Lessor, or Similar Party Maturity Value Cost Current Value
- ------------------------------------------------------------------------------------------------------------------------
Common Stock
------------
* K-Fed Bancorp Stock Company Stock ** $ 1,284,352
Common Collective Trust Funds
-----------------------------
State Street Global Advisors Stable Value ** 350,165
State Street Global Advisors Moderate Strategic Balanced ** 292,673
State Street Global Advisors Conservative Strategic Balanced ** 147,063
State Street Global Advisors Aggressive Strategic Balanced ** 153,101
State Street Global Advisors Russell 2000 ** 169,299
State Street Global Advisors S & P 500 ** 239,467
State Street Global Advisors S & P 500 Growth Fund ** 134,607
State Street Global Advisors S & P 500 Value Fund ** 171,137
State Street Global Advisors Midcap Fund ** 460,262
State Street Global Advisors Nasdaq 100 Fund ** 159,869
State Street Global Advisors REIT Index ** 11,493
State Street Global Advisors International Fund ** 137,646
State Street Global Advisors Money Market ** 300,904
State Street Global Advisors Long Term Treasury Fund ** 79,524
State Street Global Advisors Short Term Investment Fund ** 43,078
* Participant Loans
-----------------
Participants Loans: Interest rates of 5.00% to **
9.25%, maturing through October 2019 $ 91,564
----------------
$ 4,226,204
================
* Represents a party-in-interest
** Assets are participant-directed investments; therefore, cost information is
not required.
9
SIGNATURES
The Plan. Pursuant to the requirements of the Securities Exchange Act of
1934, the trustees (or other persons who administer the employee benefit plan)
have duly caused this annual report to be signed on its behalf by the
undersigned hereunto duly authorized.
KAISER FEDERAL BANK
EMPLOYEES' SAVINGS & PROFIT SHARING PLAN
AND TRUST
Date: April 11, 2008 By: //s Kay M. Hoveland
------------------------------
Name: Kay M. Hoveland
Title: Plan Administrator