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SE Financial Corp.
CONVERSION
VALUATION
APPRAISAL
Date of Market Prices: January 20, 2004
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Table of Contents
SE Financial Corp.
Philadelphia, Pennsylvania
Table of Contents I
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Introduction 1
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1. Overview and Financial Analysis 4
GENERAL OVERVIEW 4
HISTORY 5
BALANCE SHEET TRENDS 6
LOAN PORTFOLIO 9
INVESTMENTS 12
INVESTMENTS AND MORTGAGE-BACKED SECURITIES 13
ASSET QUALITY 14
FUNDING COMPOSITION 17
ASSET/LIABILITY MANAGEMENT 19
NET WORTH AND CAPITAL 20
SPREAD & MARGIN 21
LEGAL PROCEEDINGS 25
SUBSIDIARIES 25
2. Market Area Analysis 26
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MARKET AREA DEMOGRAPHICS 27
MARKET AREA DEPOSIT CHARACTERISTICS 29
3. Comparisons With Publicly Traded Thrifts 31
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INTRODUCTION 31
SELECTION CRITERIA 31
OVERVIEW OF THE COMPARABLES 37
4. Market Value Determination 40
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COMPARABLE GROUP ADJUSTMENTS 40
FINANCIAL CONDITION 41
BALANCE SHEET GROWTH 45
EARNINGS QUALITY, PREDICTABILITY AND GROWTH 47
MARKET AREA 52
CASH DIVIDENDS 54
LIQUIDITY OF THE ISSUE 56
RECENT REGULATORY MATTERS 58
MANAGEMENT 59
SUBSCRIPTION INTEREST 60
VALUATION ADJUSTMENTS 63
5. Valuation 64
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DISCUSSION OF WEIGHT GIVEN TO VALUATION MULTIPLES 64
OFFERING VALUE IN RELATION TO COMPARABLES 66
VALUATION CONCLUSION 68
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List of Figures
SE Financial Corp.
Philadelphia, Pennsylvania
FIGURE 1 - CURRENT FACILITIES LIST 4
Figure 2 - Asset and Retained Earnings Chart 6
Figure 3 - Key Balance Sheet Data 7
Figure 4 - Key Ratios 8
Figure 5 - Net Loans Receivable Chart 9
Figure 6 - Loan Mix as of October 31, 2003 Chart 10
Figure 7 - Loan Mix 11
Figure 8 - Securities Chart 12
Figure 9 - Investment Mix 13
Figure 10 - Asset Quality Chart 14
Figure 11 - Nonperforming Loans 15
Figure 12 - Allowance for Possible Loan and Lease Losses Chart 16
Figure 13 - Deposit and Borrowing Trend Chart 17
Figure 14 - Deposit Mix 18
Figure 15 - Net Portfolio Value 19
Figure 16 - Capital analysis 20
Figure 17 - Average Yields and Costs 21
Figure 18 - Spread and Margin Chart 22
Figure 19 - Income Statement Trends 23
Figure 20 - Profitability Trend chart 24
Figure 21 - Market Area Maps 26
Figure 22 - Population Demographics for 19148, Philadelphia 27
Figure 23 - Population Demographics for 08080, Sewell 28
Figure 24 - 19148, Philadelphia Market Share 29
Figure 25 - 08080, Sewell Market Share 30
Figure 26 - Size Discount 33
Figure 27 - Northeast Thrifts < $500M 34
Figure 28 - Comparable Group 36
Figure 29 - Key Financial Indicators 39
Figure 30 - Key Balance Sheet Data 41
Figure 31 - Capital Data 42
Figure 32 - Asset Quality Table 43
Figure 33 - Balance Sheet Growth Data 45
Figure 34 - Net Income Chart 48
Figure 35 - Profitability Data 49
Figure 36 - Income Statement Data 50
Figure 37 - Market Area Data 52
Figure 38 - Dividend Data 54
Figure 39 - Market Capitalization Data 56
Figure 40 - Pink Sheet Trading Discount 57
Figure 41 - Standard Conversion Pro Forma Pricing Multiples 61
Figure 42 - After Market Performance 62
Figure 43 - Value Range - Full Offering 66
Figure 44 - Value Range Pricing Multiples 66
Figure 45 - Comparable Pricing Multiples to the Bank's Pro Forma Midpoint 67
Figure 46 - Comparable Pricing Multiples to the Bank's Pro Forma Super maximum 67
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List of Exhibits
SE Financial Corp.
Philadelphia, Pennsylvania
Exhibit
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1. Profile of FinPro, Inc.
2. Consolidated Balance Sheet
3. Consolidated Income Statement
4. Consolidated Statement of Changes in Retained Earnings
5. Consolidated Statement of Cash Flows
6. Selected Financial Data
7. Industry Multiples
8. List of Fully Converted Thrifts Located in the Mid Atlantic
Region
9. Standard Conversions 2001 to Date
10. Appraisal Pro Forma October 31, 2003 - Full Offering 12 Months
11. Offering Circular Pro Forma October 31, 2003 - Full Offering 12
Months
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Conversion Valuation Appraisal Report Page: 1
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Introduction
This report represents FinPro, Inc.'s ("FinPro") updated independent appraisal
of the estimated pro forma market value of the common stock (the "Common Stock")
of SE Financial Corp. (the "Company") in connection with the Plan of Conversion
(the "Conversion") of St. Edmond's Federal Savings Bank, (the "Bank" or "St.
Edmond's") from a federally-chartered mutual savings bank to a stock savings
bank. As part of the Conversion, the Bank will become a wholly owned subsidiary
of SE Financial Corp.
In compiling the pro forma financials, FinPro relied upon the assumptions
provided by the Bank and its agents. The pro forma assumptions are as follows:
o 100% of the stock will be offered to the public,
o the stock will be issued at $10.00 per share,
o the conversion expenses will be $461 thousand at the midpoint,
o there will be an 8% ESOP funded internally, amortized over 10
years straight-line,
o there will be a 4% MRP, amortized over 5 years straight-line,
o the pro forma income is adjusted for the Incentive Retirement
Plan that was implemented by the Bank effective January 1, 2004
which provides for the award of units with a value of up to 10%
of the Bank's earnings.
o the tax rate is assumed at 38.00%, and
o the net proceeds will be invested at the three-year treasury rate
of 2.33%, pre-tax.
It is our understanding that the Company will offer its stock in a subscription
and community offering to Eligible Account Holders, to the tax qualified
Employee Plans, to Supplemental Eligible Account Holders, and to Other Members.
This appraisal has been prepared in accordance with the "Guidelines for
Appraisal Reports for the Valuation of Savings and Loan Associations Converting
from Mutual to Stock Form of Organization" of the Office of Thrift Supervision
("OTS") which have been adopted in practice by the Federal Deposit Insurance
Corporation ("FDIC"), including the most recent revisions as of October 21,
1994, and applicable regulatory interpretations thereof.
Conversion Valuation Appraisal Report Page: 2
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In the course of preparing our report, we reviewed the financial statements of
the Bank's operations for the year ended October 31, 2003, and the Bank's
audited financials for the year ended October 31, 2002. We also reviewed the
Bank's Application for Approval of Conversion including the Proxy Statement and
the Company's Form SB-2 registration statement as filed with the Securities and
Exchange Commission ("SEC"). We have conducted due diligence analysis of the
Bank and the Company (hereinafter, collectively referred to as "the Bank") and
held due diligence related discussions with the Bank's management and board,
S.R. Snodgrass, A.C. (the Bank's independent auditor), Sandler O'Neill &
Partners, L.P. (the Bank's underwriter), and Malizia, Spidi & Fisch, P.C. (the
Bank's special counsel). The valuation parameters set forth in the appraisal
were predicated on these discussions but all conclusions related to the
valuation were reached and made independent of such discussions.
Where appropriate, we considered information based upon other publicly available
sources, which we believe to be reliable; however, we cannot guarantee the
accuracy or completeness of such information. We visited the Bank's primary
market area and reviewed the market area economic condition. We also reviewed
the competitive environment in which the Bank operates and its relative
strengths and weaknesses. We compared the Bank's performance with selected
publicly traded thrift institutions. We reviewed conditions in the securities
markets in general and in the market for savings institutions in particular. Our
analysis included a review of the estimated effects of the Conversion of the
Bank on the operations and expected financial performance as they related to the
Bank's estimated pro forma value.
In preparing our valuation, we relied upon and assumed the accuracy and
completeness of financial and other information provided to us by the Bank and
its independent accountants. We did not independently verify the financial
statements and other information provided by the Bank and its independent
accountants, nor did we independently value any of the Bank's assets or
liabilities. This estimated valuation considers the Bank only as a going concern
and should not be considered as an indication of its liquidation value.
Our valuation is not intended, and must not be construed, to be a recommendation
of any kind as the advisability of purchasing shares of Common Stock in the
stock issuance. Moreover, because such valuation is necessarily based upon
estimates and projections of a number of matters, all of which are subject to
change from time to time, no assurance can be given that persons who purchase
shares of Common Stock in the stock issuance will thereafter be able to sell
such shares at prices related to the foregoing valuation of the pro forma market
value thereof. FinPro is not a seller of securities within the meaning of any
federal or state securities laws and any report prepared by FinPro shall not be
used as an offer or solicitation with respect to the purchase or sale of any
securities.
Conversion Valuation Appraisal Report Page: 3
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The estimated valuation herein will be updated as appropriate. These updates
will consider, among other factors, any developments or changes in the Bank's
financial condition, operating performance, management policies and procedures
and current conditions in the securities market for thrift institution common
stock. Should any such developments or changes, in our opinion, be material to
the estimated pro forma market value of the Bank, appropriate adjustments to the
estimated pro forma market value will be made. The reasons for any such
adjustments will be explained at that time.
Conversion Valuation Appraisal Report Page: 4
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1. Overview and Financial Analysis
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GENERAL OVERVIEW
------------------------------------
The Bank, after the Conversion, will be a federally-chartered stock savings
bank. As of October 31, 2003, the Bank had $87.4 million in total assets, $72.3
million in deposits, $50.7 million in net loans and $7.7 million in equity.
The following table shows the Bank's facilities as of October 31, 2003.
FIGURE 1 - CURRENT FACILITIES LIST
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Net Book
Year Leased or Value at
Location Opened Owned Oct 31, 2003
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Main Office 1991 Owned $ 1,057,500
1901-03 E. Passyunk Avenue
Philadelphia, PA 19148
Washingtown Township Branch 1996 Owned $ 91,500
438 Ganttown Road
Suite 1-A
Sewell, NJ 08080
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Source: Offering Prospectus
Conversion Valuation Appraisal Report Page: 5
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HISTORY
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St. Edmond's Federal Savings Bank was originally chartered and began operations
in 1912 as St. Edmond's Building and Loan Association. It became a
federally-chartered savings bank in 1995. The Bank's deposits are federally
insured by the Savings Association Insurance Fund as administered by the Federal
Deposit Insurance Corporation (the "FDIC'). The Bank is regulated by the OTS and
the FDIC.
The Bank is a community-oriented savings organization, providing traditional
retail banking services, one- to four-family residential mortgage loans,
multi-family mortgage loans, commercial mortgage loans, construction loans, home
equity loans, savings account loans and other consumer loans, including auto
loans and personal loans. The Bank conducts its operations through its main
office located in Philadelphia, Pennsylvania and a branch office located in
Sewell, New Jersey.
Conversion Valuation Appraisal Report Page: 6
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BALANCE SHEET TRENDS
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The Bank's balance sheet increased by $2.1 million, or 2.47%, from $85.3 million
at October 31, 2002 to $87.4 million at October 31, 2003.
Equity has increased $285 thousand, or 3.86%, from $7.4 million at October 31,
2002 to $7.7 million at October 31, 2003. The equity to assets ratio is
currently 8.78%.
FIGURE 2 - ASSET AND RETAINED EARNINGS CHART
[GRAPHIC OMITTED]
Source: Offering Prospectus
Conversion Valuation Appraisal Report Page: 7
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The following tables set forth certain information concerning the financial
position of the Bank at the dates indicated.
FIGURE 3 - KEY BALANCE SHEET DATA
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At October 31,
2003 2002
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($ in thousands)
Balance Sheet Data:
Assets $ 87,367 $ 85,261
Loans receivable, net 50,730 51,689
Investment securities 27,337 23,492
Cash and cash equivalents 6,304 7,301
Deposits 72,273 70,015
FHLB advances 6,637 6,694
Total equity 7,672 7,387
----------------------------------------------------
Source: Offering Prospectus
Conversion Valuation Appraisal Report Page: 8
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FIGURE 4 - KEY RATIOS
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At or For the
Year Ended October 31,
----------------------
2003 2002
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Performance ratios:
Return on average assets (net income divided by average
total assets 0.64% 0.63%
Return on average equity (net income divided by average
equity) 7.23% 7.48%
Net interest rate spread 2.95% 3.18%
Net interest margin on average interest-earnings assets 3.26% 3.54%
Average interest-earning assets to average interest-bearing
liabilities 110.36% 109.56%
Efficiency ratio (noninterest expense divided by the sum of
net interest and noninterest income) 71.24% 71.34%
Asset Quality Ratios:
Nonperforming loans to total loans, net 0.75% 1.06%
Nonperforming assets to total assets 0.48% 0.65%
Net charge-offs to average loans outstanding 0.07% 0.33%
Allowance for loan losses to total loans 0.51% 0.51%
Capital Ratios:
Average equity to average assets 8.89% 8.40%
Equity to assets at period end 8.78% 8.66%
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Source: Offering Prospectus
Conversion Valuation Appraisal Report Page: 9
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LOAN PORTFOLIO
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The Bank's loan portfolio has decreased by $959 thousand from October 31, 2002
to October 31, 2003, and as a percent of assets, the loan portfolio has
decreased from 60.62% to 58.07%.
FIGURE 5 - NET LOANS RECEIVABLE CHART
[GRAPHIC OMITTED]
Source: Offering Prospectus
Conversion Valuation Appraisal Report Page: 10
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The Bank is primarily a 1-4 family mortgage and home equity lender.
FIGURE 6 - LOAN MIX AS OF OCTOBER 31, 2003 CHART
[GRAPHIC OMITTED]
Source: Offering Prospectus
Conversion Valuation Appraisal Report Page: 11
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The Bank's loan mix remains primarily real estate-oriented in its composition.
FIGURE 7 - LOAN MIX
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At October 31,
2003 2002
Amount Percent Amount Percent
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(Dollars in Thousands)
Type of Loans:
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Real estate mortgage:
Mortgage loans:
One-to-four family $ 36,151 74.51% $ 39,753 76.23%
Multi-family and commercial 466 2.94% 1,289 2.47%
Commercial 4,006 7.84% 4,334 8.31%
Construction 1,416 0.75% 151 0.29%
Home equity loans 8,409 12.73% 5,851 11.22%
Loans on savings accounts 473 0.93% 425 0.82%
Other 151 0.30% 343 0.66%
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Total loans 51,072 100.00% 52,146 100.00%
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Less:
Net deferred loan fees and
unamortized premiums 79 190
Allowance for loan losses 263 267
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Total loans, net $ 50,730 $ 51,689
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Source: Offering Prospectus
Conversion Valuation Appraisal Report Page: 12
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INVESTMENTS
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The Bank increased its portfolio from $23.5 million at October 31, 2002, to
$27.3 million at October 31, 2003.
FIGURE 8 - SECURITIES CHART
[GRAPHIC OMITTED]
Source: Offering Prospectus
Note: Values graphed are the fair value of investments.
Conversion Valuation Appraisal Report Page: 13
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INVESTMENTS AND MORTGAGE-BACKED SECURITIES
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The following table illustrates the Bank's investment portfolio.
FIGURE 9 - INVESTMENT MIX
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At October 31,
2003 2002
---- ----
($ in thousands)
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Securities Available for Sale (at fair value):
Mortgage-backed securities $ 10,933 $ 17,523
U.S. government agency securities 13,482 4,779
Municipal securities 2,741 1,012
Mutual funds 181 178
------------------
Total securities available for sale $ 27,337 $ 23,492
==================
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Source: Offering Prospectus
Conversion Valuation Appraisal Report Page: 14
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ASSET QUALITY
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The Bank's level of nonperforming loans has decreased from $550 thousand at
October 31, 2002 to $382 thousand at October 31, 2003. The nonperforming loans
as a percentage of loans also decreased.
FIGURE 10 - ASSET QUALITY CHART
[GRAPHIC OMITTED]
Source: Offering Prospectus
Conversion Valuation Appraisal Report Page: 15
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At October 31, 2003, the Bank's nonperforming loans to loan ratio was 0.75% and
the nonperforming assets to total assets ratio was 0.48%.
FIGURE 11 - NONPERFORMING LOANS
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At October 31,
2003 2002
(Dollars in thousands)
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Loans accounted for on a non-accrual basis:
Mortgage loans:
One-to-four family $ 311 $ 499
Multi-family 59 -
Commercial real estate - 18
Home equity loans - 26
----- -----
Total $ 370 $ 543
===== =====
Accruing loans which are contractually past due 90 days or more:
Loans on savings accounts 12 1
Other - 6
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Total $ 12 $ 7
===== =====
Total non-performing loans $ 382 $ 550
===== =====
Real estate owned $ 39 $ 25
===== =====
Other nonperforming assets $ - $ -
===== =====
Total nonperforming assets $ 421 $ 575
===== =====
Total nonperforming loans to net loans 0.75% 1.06%
===== =====
Total nonperforming loans to total assets 0.44% 0.65%
===== =====
Total nonperforming assets to total assets 0.48% 0.67%
===== =====
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Source: Offering Prospectus
Conversion Valuation Appraisal Report Page: 16
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The ALLL decline $4 thousand between October 31, 2002 and October 31, 2003. The
Bank's ALLL to loans ratio was 0.51% at October 31, 2003.
FIGURE 12 - ALLOWANCE FOR POSSIBLE LOAN AND LEASE LOSSES CHART
[GRAPHIC OMITTED]
Source: Offering Prospectus
Conversion Valuation Appraisal Report Page: 17
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FUNDING COMPOSITION
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Deposits have increased from $70.0 million at October 31, 2002 to $72.3 million
at October 31, 2003. The Bank has $6.6 million in outstanding borrowings as of
October 31, 2003.
FIGURE 13 - DEPOSIT AND BORROWING TREND CHART
[GRAPHIC OMITTED]
Source: Offering Prospectus
Conversion Valuation Appraisal Report Page: 18
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The Bank's deposit mix as of October 31, 2003 is heavily weighted in time
deposits.
FIGURE 14 - DEPOSIT MIX
[GRAPHIC OMITTED]
Source: Offering Prospectus
Conversion Valuation Appraisal Report Page: 19
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ASSET/LIABILITY MANAGEMENT
------------------------------------------
The following chart depicts the Bank's Net Portfolio Value ("NPV") at September
30, 2003 under all rate shocks.
FIGURE 15 - NET PORTFOLIO VALUE
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Net Portfolio Value ("NPV") NPV as % of Present Value of Assets
----------------------------------------- -----------------------------------
Percentage
Changes in Rates Amount of of NPV NPV Ratio Change
(basis points) Estimated NPV ($) Change Change (%) (basis points)
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+300 bp $ 7,435 $ (3,193) -30% 8.70% (289)
+200 bp 8,716 (1,912) -18% 9.94% (165)
+100 bp 9,812 (816) -8% 10.93% (67)
0 bp 10,628 -- -- 11.59% -
- -100 bp 10,500 (128) -1% 11.32% (27)
- -200 - - -% -% -
- -300 - - -% -% -
- ---------------------------------------------------------------------------------------------------
Source: Offering Prospectus
Conversion Valuation Appraisal Report Page: 20
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NET WORTH AND CAPITAL
------------------------------------------
At October 31, 2003, the Bank had capital in excess of the minimum requirements
for all capital ratios.
FIGURE 16 - CAPITAL ANALYSIS
-----------------------------------------------------------------
Historical at October 31, 2003
---------------------------------
Regulatory Capital Position Percentage of
Amount Assets
-----------------------------------------------------------------
GAAP Capital $ 7,672 8.78%
Tier 1 (Core) Capital
Capital Level $ 7,756 8.86%
Requirement 3,500 4.00%
-----------------------------------------------------------------
Excess $ 4,256 4.86%
Total Risk-Based Capital
Capital Level $ 8,018 21.03%
Requirement 3,050 8.00%
-----------------------------------------------------------------
Excess $ 4,968 13.03%
-----------------------------------------------------------------
Source: Offering Prospectus
Conversion Valuation Appraisal Report Page: 21
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SPREAD & MARGIN
------------------------------------------
The net interest spread and margin decreased between the years ended October 31,
2002 and October 31, 2003.
FIGURE 17 - AVERAGE YIELDS AND COSTS
- ---------------------------------------------------------------------------------------------------------------------------------
For the Year Ended October 31,
-----------------------------------------------------------------------------
2003 2002
Average Average
Average Yield/ Average Yield/
Balance Interest Cost Balance Interest Cost
- ---------------------------------------------------------------------------------------------------------------------------------
(Dollars in thousands)
Interest-earning assets:
Loans receivable net $ 49,785 $ 3,934 7.90% $ 55,382 $ 4,650 8.40%
Investment Securities 27,839 1,111 4.13% 20,972 1,094 5.26%
Other interest-earning assets 5,487 75 1.37% 4,117 93 2.26%
Total interest-earning assets 83,111 $ 5,120 6.21% 80,471 $ 5,837 7.27%
------- -------
Non-interest-earning assets 3,375 3,659
-------- --------
Total assets $ 86,486 $ 84,130
======== ========
Interest-bearing liabilities:
Interest-bearing demand deposits $ 2,968 $ 36 1.21% $ 2,865 $ 39 1.36%
Money market deposits 4,108 80 1.95% 3,528 97 2.75%
Savings accounts 9,081 146 1.61% 8,657 178 2.06%
Certificates of deposit 52,490 1,966 3.75% 51,038 2,391 4.68%
FHLB borrowings 6,664 222 3.33% 7,359 294 4.00%
------------------------------- --------------------------------
Total interest-bearing liabilities 75,311 $ 2,450 3.24% 73,447 $ 2,999 4.09%
------- -------
Non-interest bearing liabilities 3,486 3,614
-------- --------
Total liabilities 78,797 77,061
Retained earnings 7,689 7,069
-------- --------
Total liabilities and retained earnings $ 86,486 $ 84,130
======== ========
Net interest income $ 2,670 $ 2,838
------- -------
Interest rate spread 2.95% 3.18%
Net yield on interest-earning assets 3.26% 3.54%
Ratio of average interest-earning assets to
average interest-bearing liabilities 110.36% 109.56%
- ---------------------------------------------------------------------------------------------------------------------------------
Source: Offering Prospectus
Conversion Valuation Appraisal Report Page: 22
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Between the twelve months ended October 31, 2002 and the twelve months ended
October 31, 2003, the Bank's spread and margin decreased, as the decline in
yield was only partially offset by the decline in cost of funds.
FIGURE 18 - SPREAD AND MARGIN CHART
[GRAPHIC OMITTED]
Source: Offering Prospectus
Conversion Valuation Appraisal Report Page: 23
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The Bank posted net income of $556 thousand for the year ended October 31, 2003,
compared with $529 thousand for the year ended October 31, 2002. The increase is
primarily attributable to lower noninterest expense and higher noninterest
income.
FIGURE 19 - INCOME STATEMENT TRENDS
- --------------------------------------------------------------------------------
At or For the
Year Ended Ended October 31,
2003 2002
---- ----
(In thousands)
Summary of Operations:
Interest and dividend income $5,120 $5,837
Interest expense 2,450 2,999
Net interest income 2,670 2,838
Provision for loan losses 33 25
Net interest income after provision for loan losses 2,637 2,813
Noninterest income 386 365
Noninterest expense 2,177 2,285
Income before income taxes 846 893
Income taxes 290 364
------ ------
Net income $ 556 $ 529
====== ======
- --------------------------------------------------------------------------------
Source: Offering Prospectus
Conversion Valuation Appraisal Report Page: 24
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The ROAA, consistent with net income, increased for the year ended October 31,
2003 relative to the year ended October 31, 2002.
FIGURE 20 - PROFITABILITY TREND CHART
[GRAPHIC OMITTED]
Source: Offering Prospectus
Conversion Valuation Appraisal Report Page: 25
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------------------------------------------
LEGAL PROCEEDINGS
------------------------------------------
The Bank, from time to time, is a party to routine litigation, which arises in
the normal course of business, such as claims to enforce liens, condemnation
proceedings on properties in which the Bank holds security interests, claims
involving the making and servicing of real property loans, and other issues
incident to the business of the Bank. There were no lawsuits pending or known to
be contemplated against the Bank at October 31, 2003 that would have a material
effect on operations or income.
------------------------------------------
SUBSIDIARIES
------------------------------------------
The Bank is permitted to invest its assets in the capital stock of, or originate
secured or unsecured loans to, subsidiary corporations. The Bank has one
inactive service corporation.
Conversion Valuation Appraisal Report Page: 26
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2. Market Area Analysis
The following maps delineate the market area for each of the Bank's branches
based upon zip code.
FIGURE 21 - MARKET AREA MAPS
[GRAPHIC OMITTED]
Conversion Valuation Appraisal Report Page: 27
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MARKET AREA DEMOGRAPHICS
------------------------------------------
The following tables summarize the demographics for the Bank's markets.
FIGURE 22 - POPULATION DEMOGRAPHICS FOR 19148, PHILADELPHIA
[GRAPHIC OMITTED]
Source: Claritas
Conversion Valuation Appraisal Report Page: 28
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FIGURE 23 - POPULATION DEMOGRAPHICS FOR 08080, SEWELL
[GRAPHIC OMITTED]
Source: Claritas
Conversion Valuation Appraisal Report Page: 29
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------------------------------------------
MARKET AREA DEPOSIT
CHARACTERISTICS
------------------------------------------
Due to the nature of the Bank's service area, the competition was defined as all
branches within the zip code defined in the Market Area Demographics section.
FIGURE 24 - 19148, PHILADELPHIA MARKET SHARE
[GRAPHIC OMITTED]
Source: SNL Securities data, FinPro calculations.
Conversion Valuation Appraisal Report Page: 30
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FIGURE 25 - 08080, SEWELL MARKET SHARE
[GRAPHIC OMITTED]
Source: SNL Securities data, FinPro calculations.
Conversion Valuation Appraisal Report Page: 31
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3. Comparisons With Publicly Traded Thrifts
------------------------------------------
INTRODUCTION
------------------------------------------
This section presents an analysis of the Bank's operations against a selected
group ("Comparable Group") of publicly traded thrifts. The Comparable Group was
selected based upon the similarity of characteristics to the Bank. The
Comparable Group multiples provide the basis for the valuation of the Bank.
Factors that influence the Bank's value such as balance sheet structure and
size, profitability, income and expense trends, capital levels, credit risk, and
recent operating results can be measured against the Comparable Group. The
Comparable Group's current market pricing, coupled with the appropriate
adjustments for differences between the Bank and the Comparable Group, will then
be utilized as the basis for the pro forma valuation of the Bank's to-be-issued
common stock.
There are two primary areas of concern to appraisers today. The first is the
lack of overall publicly traded thrifts available for comparative purposes with
only 174 total fully converted thrifts left in the entire country. The second is
a byproduct of the first. There are simply not enough good institutions left to
allow for highly accurate geographic and size comparisons. As such, comparable
groups are becoming more difficult to establish and the result will be more
premiums and discounts that need to be applied.
------------------------------------------
SELECTION CRITERIA
------------------------------------------
The goal of the selection criteria process is to find those institutions with
characteristics that most closely match those of the Bank. In an ideal world,
all of the Comparable Group would contain the exact characteristics of the Bank.
However, none of the Comparables selected will be exact clones of the Bank. As
stated above, establishing Comparable Groups that very closely match a given
institution is becoming more and more difficult. This is particularly true for
this institution.
Based upon our experience, FinPro has determined that fully converted thrifts
trade differently than MHCs trade due to the unique ownership structure of an
MHC, namely that all MHCs contain some level of minority discount. As such all
MHCs were eliminated as potential Comparables.
Conversion Valuation Appraisal Report Page: 32
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Ideally, FinPro would utilize only liquidly traded fully converted thrifts as
Comparables. As will be discussed later, in this case that means either
selecting substantially larger similar geographical public thrifts, or similar
size but different geographic based institutions. FinPro analyzed both and has
discussed both in this appraisal document. Ultimately, FinPro concluded that the
similar size, national geography based Comparable Group provides the best
comparisons and as such, used it in this appraisal.
As of the date of this appraisal, there were a total of 174 fully converted
thrifts that traded on the NYSE, NASDAQ or AMEX. FinPro limited the Comparable
Group to institutions whose common stock is listed on a major exchange, since
these companies trade regularly. FinPro believes that thrifts that trade
over-the-counter or as pink sheets contain liquidity discounts along with wider
bid-ask ranges relative to liquidly traded thrifts. This may skew the trading
value and make trading multiples less reliable as an indicator of value. If
these institutions are utilized, a liquidity discount must be calculated and
used.
Due to the differences in regional pricing, FinPro would like to utilize
institutions located in the Mid Atlantic Region in the Comparable Group. There
are currently 39 fully converted thrifts in the Mid Atlantic Region. Of these
39, none are less than or equal to $150 million in size and as such none are of
similar size to St. Edmonds, which has only $87.4 million in assets.
If however, fully converted Mid Atlantic thrifts were utilized as the Comparable
Group, the following screening process would be utilized to select the
Comparable Group:
[GRAPHIC OMITTED]
Conversion Valuation Appraisal Report Page: 33
================================================================================
Utilizing these criteria, no thrifts met the criteria. The reason is that there
are no regional publicly traded institutions less than or equal to $150 million
in asset size as stated earlier. See Exhibit 8 for the list of the Mid Atlantic
publicly traded thrifts arrayed by size.
Therefore, FinPro expanded the asset size to less than or equal to $500 million
in assets and the region to include New England. In so doing, FinPro recognizes
that there will need to be a discount applied directly to this group for size.
As shown below, the discount for size on a tangible book basis is 7.08%.
FIGURE 26 - SIZE DISCOUNT
-------------------------------------------------------------------------------------
Current Price in Relation to
Total Current -----------------------------------------------------------------------------------
Assets Market Tangible
MRQ Value Earnings Core EPS LTM EPS LTM Core EPS Book Value Book Value Assets
($000's) ($M) (x) (x) (x) (x) (%) (%) (%)
- ------------------------------------------------------------------------------------------------------------------------------
<$150M Median 121,375 18.41 23.01 21.86 19.46 18.48 127.51 127.51 16.34
- ------------------------------------------------------------------------------------------------------------------------------
$150M - $500M Median 288,652 37.65 16.98 17.47 16.92 17.62 131.73 137.23 13.71
- ------------------------------------------------------------------------------------------------------------------------------
Premium/Discount 35.48% 25.10% 15.01% 4.88% -3.20% -7.08% 19.18%
- ------------------------------------------------------------------------------------------------------------------------------
The size discount was computed by looking at nationwide public thrifts under
$150 million in assets and comparing their multiples to the multiples of
nationwide public thrifts between $150 million in assets and $500 million in
assets.
The screens utilized for this round of comparable selection include:
[GRAPHIC OMITTED]
Conversion Valuation Appraisal Report Page: 34
================================================================================
The screens resulted in fourteen fully converted Northeast thrifts with assets
less than $500 million. Of the fourteen selected fully converted Northeast
thrifts with assets less than $500 million, two were merger targets (Falmouth
and Alliance) and therefore were eliminated from the Comparable Group.
Additionally, Independence Federal Savings Bank is currently unprofitable and
was eliminated from the Comparable Group. The resulting Comparable Group ranged
in size from $159.1 million to $478.4 million in total assets with a median of
$388.9 million. The Bank's asset size was $87.4 million as of October 31, 2003
and is projected to be $102.3 million on a pro forma basis at the midpoint of
the estimated valuation range. Clearly, these are substantially not comparable
from a size perspective.
If these screens were utilized, the resulting group is:
FIGURE 27 - NORTHEAST THRIFTS < $500M
Corporate
---------------------------------------------------------------------
Number
of IPO Conversion
Ticker Short Name Exchange City State Offices Date Type
- -------------------------------------------------------------------------------------------------------------------------------
Comparable Thrift Data
ALFC Atlantic Liberty Financial Corp NASDAQ Brooklyn NY 2 10/23/2002 Standard
CEBK Central Bancorp, Inc. NASDAQ Somerville MA 10 10/24/1986 Standard
ESBK Elmira Savings Bank, FSB NASDAQ Elmira NY 6 03/01/1985 Standard
HIFS Hingham Institution for Savings NASDAQ Hingham MA 7 12/20/1988 Standard
LARL Laurel Capital Group, Inc. NASDAQ Allison Park PA 8 02/20/1987 Standard
LSBX LSB Corporation NASDAQ North Andover MA 6 05/02/1986 Standard
MFLR Mayflower Co-operative Bank NASDAQ Middleboro MA 5 12/23/1987 Standard
MYST Mystic Financial, Inc. NASDAQ Medford MA 6 01/09/1998 Standard
NBN Northeast Bancorp AMEX Auburn ME 12 08/19/1987 Standard
PHSB PHSB Financial Corp. NASDAQ Beaver Falls PA 10 12/21/2001 Second-Stage
WVFC WVS Financial Corp. NASDAQ Pittsburgh PA 6 11/29/1993 Standard
- --------------------------------------------------- ---------------------------------------------------------------------
This Comparable Group would have resulted in a price to tangible book multiple
of 152.61% and a price to core earnings of 18.07 times. These multiples must be
adjusted directly for size however. After application of the 7.08% discount for
size and the premium of 25.10% for core earnings, the adjusted price to tangible
book multiple would be 141.81% and the price to core earnings would be 22.61
times.
As a result of the substantial difference in size, FinPro does not believe that
this group should be utilized.
Conversion Valuation Appraisal Report Page: 35
================================================================================
FinPro then selected a Comparable Group based on similar size. The screens
utilized for the selected Comparable Group included all nationwide publicly
traded thrifts with the following criteria used to focus the Comparable Group:
[GRAPHIC OMITTED]
These screens resulted in 12 institutions, but none were located in the Mid
Atlantic region. Similar to the discussion on size, FinPro was uncomfortable
having no Comparables in the same region. To add some institutions in the Mid
Atlantic region into the Comparable Group, FinPro added all Mid Atlantic
institutions under $300 million in assets. There were three institutions under
$300 million located in the Mid Atlantic region: Atlantic Liberty, Elmira
Savings Bank and Independence Federal Savings Bank. Independence Federal Savings
Bank was eliminated since it had negative earnings.
Conversion Valuation Appraisal Report Page: 36
================================================================================
As such, the Comparable Group selected includes:
FIGURE 28 - COMPARABLE GROUP
Corporate
---------------------------------------------------------------------
Number
of IPO Conversion
Ticker Short Name Exchange City State Offices Date Type
- ------------------------------------------------------------------------------------------------------------------------------------
Comparable Thrift Data
ALFC Atlantic Liberty Financial Corp NASDAQ Brooklyn NY 2 10/23/2002 Standard
AMFC AMB Financial Corp. NASDAQ Munster IN 3 04/01/1996 Standard
CIBI Community Investors Bancorp, Inc. NASDAQ Bucyrus OH 3 02/07/1995 Standard
CKFB CKF Bancorp, Inc. NASDAQ Danville KY 3 01/04/1995 Standard
ESBK Elmira Savings Bank, FSB NASDAQ Elmira NY 6 03/01/1985 Standard
FFDF FFD Financial Corporation NASDAQ Dover OH 3 04/03/1996 Standard
FKKY Frankfort First Bancorp, Inc. NASDAQ Frankfort KY 3 07/10/1995 Standard
FNFI First Niles Financial, Inc. NASDAQ Niles OH 1 10/27/1998 Standard
HWEN Home Financial Bancorp NASDAQ Spencer IN 2 07/02/1996 Standard
NBSI North Bancshares, Inc. NASDAQ Chicago IL 2 12/21/1993 Standard
PBNC PFS Bancorp, Inc. NASDAQ Aurora IN 3 10/12/2001 Standard
PSFC Peoples-Sidney Financial Corporation NASDAQ Sidney OH 4 04/28/1997 Standard
SZB SouthFirst Bancshares, Inc. AMEX Sylacauga AL 3 02/14/1995 Standard
UTBI United Tennessee Bankshares, Inc. NASDAQ Newport TN 3 01/05/1998 Standard
- --------------------------------------------------- ---------------------------------------------------------------------
The two Comparables located in the Mid Atlantic region trade at similar
multiples to the rest of the Comparable Group located outside of the region.
This is concrete evidence that no adjustment need be made for geography within
this Comparable Group and supports FinPro's decision to utilize similar size
rather than similar geography in selection of the Comparable Group.
All 14 of the Comparables have been public for more than one year. FinPro would
ordinarily exclude institutions that have recently converted, as the earnings of
newly converted institutions do not reflect a full years benefit from the
reinvestment of proceeds, and thus the price/earnings multiples and return on
equity measures for these institutions tend to be skewed upward and downward
respectively.
It is FinPro's opinion that this Comparable Group is reflective of St. Edmonds,
as the following analyses will indicate.
Conversion Valuation Appraisal Report Page: 37
================================================================================
------------------------------------------
OVERVIEW OF THE COMPARABLES
------------------------------------------
The members of the Comparable Group were reviewed against the Bank to ensure
comparability based upon the following criteria:
1. Asset size
2. Profitability
3. Capital Level
4. Balance Sheet Mix
5. Operating Strategy
6. Date of conversion
1. Asset Size The Comparable Group should have a similar asset size to the Bank,
however, this is not possible due to the Bank's small asset base and the
requirement of being listed on a major exchange. The Comparable Group ranged in
size from $61.8 million to $291.3 million in total assets with a median of
$135.1 million. The Bank's asset size was $87.4 million as of October 31, 2003
and is projected to be $102.3 million on a pro forma basis at the midpoint of
the estimated valuation range.
2. Profitability The Comparable Group had a median ROAA of 0.82% and a median
ROAE of 5.94% for the last twelve months. The Comparable Group profitability
measures had a dispersion about the mean for the ROAA measure ranging from a low
of 0.08% to a high of 1.52% while the ROAE measure ranged from a low of 0.91% to
a high of 11.46%. The Bank had a ROAA of 0.64% and ROAE of 7.23% for the twelve
months ended October 31, 2003. On a pro forma basis, the ROAA is projected at
0.58% and the ROAE is projected at 2.64% at the midpoint of the range.
3. Capital Level The median equity to assets ratio for the Comparable Group was
11.71% with a high of 22.61% and a low of 7.45%. At October 31, 2003, the Bank
had an equity to assets ratio of 8.78%. On a pro forma basis, at the midpoint,
the Bank would have an equity to assets ratio of 22.10%.
Conversion Valuation Appraisal Report Page: 38
================================================================================
4. Balance Sheet Mix At October 31, 2003, the Bank had a net loan to asset ratio
of 58.07%. The median loan to asset ratio for the Comparables was 78.06%,
ranging from a low of 39.46% to a high of 90.31%. On the liability side, the
Bank's deposit to asset ratio was 82.72% at October 31, 2003 while the
Comparable median was 70.70%, ranging from 54.90% to 84.25%. Additionally, the
Bank's borrowing to assets ratio was 7.60% at October 31, 2003 and the
Comparable median borrowings to assets ratio was 15.76% with a range of 30.77%
to 0.00%.
5. Operating strategy An institution's operating characteristics are important
because they determine future performance. They also affect expected rates of
return and investor's general perception of the quality, risk and attractiveness
of a given company. Specific operating characteristics include profitability,
balance sheet growth, asset quality, capitalization, and non-financial factors
such as management strategies and lines of business.
6. Date of conversion Recent conversions, those completed on or after October
31, 2002, were excluded since the earnings of a newly converted institution do
not reflect a full year's benefits of reinvestment of conversion proceeds.
Additionally, new issues tend to trade at a discount to the market averages.
Conversion Valuation Appraisal Report Page: 39
================================================================================
All Comparable Group data presented in Figure 29 is from SNL Securities. All
data for the Bank is from the offering circular.
FIGURE 29 - KEY FINANCIAL INDICATORS
- --------------------------------------------------------------------------------
Comparable
Group
The Bank Median
- --------------------------------------------------------------------------------
Balance Sheet Data
- --------------------------------------------------------------------------------
Gross Loans to Deposits 73.84% 105.26%
- --------------------------------------------------------------------------------
Total Net Loans to Assets 58.07% 78.06%
- --------------------------------------------------------------------------------
Securities to Assets 31.29% 10.69%
- --------------------------------------------------------------------------------
Deposits to Assets 82.72% 70.70%
- --------------------------------------------------------------------------------
Borrowed Funds to Assets 7.60% 15.76%
- --------------------------------------------------------------------------------
Interest Earning Assets to Interest Bearing Liabilities 110.36% 114.04%
- --------------------------------------------------------------------------------
Balance Sheet Growth - LTM
- --------------------------------------------------------------------------------
Asset Growth Rate 2.47% 0.32%
- --------------------------------------------------------------------------------
Loan Growth Rate -1.86% -2.06%
- --------------------------------------------------------------------------------
Deposit Growth Rate 3.23% 0.52%
- --------------------------------------------------------------------------------
Capital
- --------------------------------------------------------------------------------
Equity to Assets 8.78% 11.71%
- --------------------------------------------------------------------------------
Tangible Equity to Assets 8.78% 11.71%
- --------------------------------------------------------------------------------
Intangible Assets to Equity 0.00% 0.00%
- --------------------------------------------------------------------------------
Regulatory Core Capital to Assets 8.86% 11.25%
- --------------------------------------------------------------------------------
Equity + Reserves to Assets 9.08% 12.25%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Asset Quality
- --------------------------------------------------------------------------------
Non-Performing Loans to Loans 0.75% 1.04%
- --------------------------------------------------------------------------------
Reserves to Non-Performing Loans 68.85% 67.84%
- --------------------------------------------------------------------------------
Non-Performing Assets to Assets 0.48% 0.76%
- --------------------------------------------------------------------------------
Non-Performing Assets to Equity 5.49% 7.07%
- --------------------------------------------------------------------------------
Reserves to Net Loans 0.51% 0.71%
- --------------------------------------------------------------------------------
Reserves to Non-Performing Assets + 90 Days Del. 62.47% 63.54%
- --------------------------------------------------------------------------------
Profitability
- --------------------------------------------------------------------------------
Return on Average Assets 0.64% 0.82%
- --------------------------------------------------------------------------------
Return on Average Equity 7.23% 5.94%
- --------------------------------------------------------------------------------
Income Statement
- --------------------------------------------------------------------------------
Yield on Average Earning Assets 6.21% 6.01%
- --------------------------------------------------------------------------------
Cost of Interest Bearing Liabilities 3.25% 2.94%
- --------------------------------------------------------------------------------
Net Interest Spread 2.95% 2.87%
- --------------------------------------------------------------------------------
Net Interest Margin 3.26% 3.20%
- --------------------------------------------------------------------------------
Noninterest Income to Average Assets 0.45% 0.36%
- --------------------------------------------------------------------------------
Noninterest Expense to Average Assets 2.52% 2.38%
- --------------------------------------------------------------------------------
Efficiency Ratio 71.24% 64.96%
- --------------------------------------------------------------------------------
Overhead Ratio 67.08% 57.95%
- --------------------------------------------------------------------------------
Source: The Bank Offering Circular, FinPro calculations and SNL Securities
Note: All of the Bank data is at or for the twelve months ended October 31,
2003.
Note: All of the Comparable data is for the last twelve months.
Conversion Valuation Appraisal Report Page: 40
================================================================================
4. Market Value Determination
------------------------------------------
COMPARABLE GROUP ADJUSTMENTS
------------------------------------------
The estimated pro forma market value of the Bank, along with certain adjustments
to its value relative to market values for the Comparable Group are delineated
in this section. The adjustments are made from potential investors' viewpoint
and are adjustments necessary when comparing the Bank to the Comparable Group.
Potential investors include depositors holding subscription rights and unrelated
parties who may purchase stock in the community offering and who are assumed to
be aware of all relevant and necessary facts as they pertain to the value of the
Bank relative to other publicly traded thrift institutions and relative to
alternative investment opportunities.
There are numerous criteria on which the market value adjustments are based. The
major criteria utilized for purposes of this report include:
Adjustments Relative to the Comparable Group:
- ---------------------------------------------
o Financial Condition
o Balance Sheet Growth
o Earnings Quality, Predictability and Growth
o Market Area
o Cash Dividends
o Liquidity of the Issue
o Recent Regulatory Matters
Adjustments for Other Factors:
- ------------------------------
o Management
o Subscription Interest
To ascertain the market value of the Bank, the median trading multiple values
for the Comparable Group are utilized as the starting point. Adjustments, up or
down, to the Comparable Group median multiple values are made based on the
comparison of the Bank to the Comparable Group.
Conversion Valuation Appraisal Report Page: 41
================================================================================
------------------------------------------
FINANCIAL CONDITION
------------------------------------------
The financial condition of an institution is an important market value
determinant, as the investment community considers such factors as bank
liquidity, capitalization, asset composition, funding mix and intangible levels
in assessing the attractiveness of investing in the common stock of a thrift.
The following tables summarize the key financial elements of the Bank measured
against the Comparable Group.
FIGURE 30 - KEY BALANCE SHEET DATA
Key Financial Data for the Most Recent Quarter
--------------------------------------------------------------------------------------------------------------------------
Total Loans/ Loans/ Securities Deposits/ Borrowings/ IEA/
Assets Deposits Assets Assets Assets Assets IBL
Ticker Short Name ($000) (%) (%) (%) (%) (%) (%)
- -----------------------------------------------------------------------------------------------------------------------------------
Comp
ALFC Atlantic Liberty Financial Corp 159,080 97.74 67.19 25.19 68.74 13.33 118.61
AMFC AMB Financial Corp. 148,499 106.27 79.71 6.83 75.00 14.11 102.30
CIBI Community Investors Bancorp, Inc. 121,375 110.13 78.62 10.51 71.40 17.41 109.88
CKFB CKF Bancorp, Inc. 144,984 103.36 86.75 8.27 83.93 4.76 108.40
ESBK Elmira Savings Bank, FSB 291,292 80.82 64.99 30.07 80.41 11.00 115.55
FFDF FFD Financial Corporation 136,469 112.09 84.88 3.55 75.73 11.28 113.10
FKKY Frankfort First Bancorp, Inc. 138,611 164.50 90.31 4.63 54.90 30.77 114.98
FNFI First Niles Financial, Inc. 98,956 63.53 39.46 53.88 62.12 20.72 121.33
HWEN Home Financial Bancorp 61,828 124.13 77.50 5.77 62.44 25.88 104.88
NBSI North Bancshares, Inc. 129,981 104.24 69.20 22.36 66.38 21.16 115.93
PBNC PFS Bancorp, Inc. 117,625 108.49 82.86 10.86 76.38 - 129.13
PSFC Peoples-Sidney Financial Corporation 140,667 128.88 83.62 6.38 64.88 22.51 112.54
SZB SouthFirst Bancshares, Inc. 133,654 91.47 64.03 25.23 70.00 20.20 100.98
UTBI United Tennessee Bankshares, Inc. 117,681 80.01 67.41 26.24 84.25 - 115.63
- -----------------------------------------------------------------------------------------------------------------------------------
Average 138,622 105.40 74.04 17.13 71.18 15.22 113.09
Median 135,062 105.26 78.06 10.69 70.70 15.76 114.04
Maximum 291,292 164.50 90.31 53.88 84.25 30.77 129.13
Minimum 61,828 63.53 39.46 3.55 54.90 - 100.98
TBD SE Financial Corp. 87,367 73.84 58.07 31.29 82.72 7.60 110.36
Variance to the Comparable Median (47,695) (31.41) (19.99) 20.60 12.02 (8.16) (3.68)
- -----------------------------------------------------------------------------------------------------------------------------------
Sources: SNL and Offering Circular Data, FinPro Computations
Asset Composition - The Bank's net loan to asset ratio of 58.07% is
------------------
below the Comparable Group median of 78.06%.
Funding Mix - The Bank is funded primarily through deposits, 82.72% of
-----------
assets, and borrowings, 7.60% of assets. The Comparable Group has a
deposits to assets ratio of 70.70% and a borrowings to assets ratio of
15.76%.
Liquidity - The liquidity of the Bank and the Comparable Group appear
---------
adequate.
Conversion Valuation Appraisal Report Page: 42
================================================================================
FIGURE 31 - CAPITAL DATA
Capital for the Most Recent Quarter
-------------------------------------------------------------
Tangible Intangible Core Capital/ Equity +
Equity/ Equity/ Assets/ Tangible Reserves/
Assets Tang Assets Equity Assets Assets
Ticker Short Name (%) (%) (%) (%) (%)
- --------------------------------------------------------------------------------------------------------------------
Comparable Thrift Data
ALFC Atlantic Liberty Financial Corp 16.26 16.26 - 11.39 16.63
AMFC AMB Financial Corp. 8.21 8.21 - 8.40 8.88
CIBI Community Investors Bancorp, Inc. 10.67 10.67 - 10.44 11.13
CKFB CKF Bancorp, Inc. 10.39 9.71 7.30 NA 10.82
ESBK Elmira Savings Bank, FSB 7.45 7.26 2.72 7.34 8.25
FFDF FFD Financial Corporation 12.44 12.44 - 11.66 13.03
FKKY Frankfort First Bancorp, Inc. 12.90 12.90 - 11.25 12.96
FNFI First Niles Financial, Inc. 16.22 16.22 - 14.60 16.99
HWEN Home Financial Bancorp 11.02 11.02 - 9.10 11.57
NBSI North Bancshares, Inc. 10.47 10.47 - 10.07 10.72
PBNC PFS Bancorp, Inc. 22.61 22.61 - 17.95 23.24
PSFC Peoples-Sidney Financial Corporation 12.39 12.39 - 11.30 12.93
SZB SouthFirst Bancshares, Inc. 8.74 8.36 4.66 9.99 9.63
UTBI United Tennessee Bankshares, Inc. 13.92 13.32 4.96 11.32 14.68
- --------------------------------------------------------------------------------------------------------------------
Average 12.41 12.27 1.40 11.14 12.96
Median 11.71 11.71 - 11.25 12.25
Maximum 22.61 22.61 7.30 17.95 23.24
Minimum 7.45 7.26 - 7.34 8.25
TBD SE Financial Corp. 8.78 8.78 - 8.86 9.08
Variance to the Comparable Median (2.93) (2.93) - (2.39) (3.17)
Sources: SNL and Offering Circular Data, FinPro Computations
Capitalization - The Comparable Group's median equity to assets ratio
--------------
of 11.71% is higher than the Bank's ratio of 8.78%. The Bank's pro
forma equity to assets ratio is projected to be 22.10% at the midpoint
of the valuation range.
Intangible Levels - One factor influencing market values is the level
-----------------
of intangibles that an institution carries on its books. Thrifts trade
more on tangible book than on book. The Bank does not have any
intangibles. Four of the Comparables have a modest level of
intangibles.
Conversion Valuation Appraisal Report Page: 43
================================================================================
The asset quality of an institution is an important determinant of market value.
The investment community considers levels of nonperforming loans, Real Estate
Owned ("REO") and levels of Allowance for Loan and Lease Losses ("ALLL") in
assessing the attractiveness of investing in the common stock of an institution.
FIGURE 32 - ASSET QUALITY TABLE
- ---------------------------------------------------------------------------------------------------------------------------------
Asset Quality for the Most Recent Quarter
--------------------------------------------------------------------------
NPLs/ Reserves/ NPAs/ NPAs/ Reserves/ Reserves/
Loans NPLs Assets Equity Loans NPAs + 90
Ticker Short Name (%) (%) (%) (%) (%) (%)
- ---------------------------------------------------------------------------------------------------------------------------------
Comp
ALFC Atlantic Liberty Financial Corp 0.27 198.63 0.23 1.43 0.54 156.87
AMFC AMB Financial Corp. 1.09 77.52 0.97 11.79 0.84 69.59
CIBI Community Investors Bancorp, Inc. 0.97 59.40 0.76 7.15 0.58 59.40
CKFB CKF Bancorp, Inc. NA NA NA NA 0.49 NA
ESBK Elmira Savings Bank, FSB 1.09 113.53 0.75 10.01 1.23 106.77
FFDF FFD Financial Corporation 1.04 67.67 0.88 7.07 0.70 67.67
FKKY Frankfort First Bancorp, Inc. - NM - - 0.07 9.70
FNFI First Niles Financial, Inc. 1.94 100.79 0.76 4.71 1.95 72.64
HWEN Home Financial Bancorp 1.35 52.55 2.27 20.61 0.71 24.22
NBSI North Bancshares, Inc. - NM - - 0.36 NM
PBNC PFS Bancorp, Inc. 1.13 68.00 1.08 4.77 0.77 58.94
PSFC Peoples-Sidney Financial Corporation 1.01 63.34 0.92 7.42 0.64 36.51
SZB SouthFirst Bancshares, Inc. 2.51 55.42 1.66 18.99 1.39 53.72
UTBI United Tennessee Bankshares, Inc. - NM 0.04 0.29 1.12 218.38
- ---------------------------------------------------------------------------------------------------------------------------------
Average 0.95 85.69 0.79 7.25 0.81 77.87
Median 1.04 67.84 0.76 7.07 0.71 63.54
Maximum 2.51 198.63 2.27 20.61 1.95 218.38
Minimum - 52.55 - - 0.07 9.70
TBD SE Financial Corp. 0.75 68.85 0.48 5.49 0.51 62.47
Variance to the Comparable Median (0.29) 1.01 (0.28) (1.58) (0.20) (1.06)
Sources: SNL and Offering Circular Data, FinPro Computations
The Bank's level of nonperforming loans ("NPL") to total loans, at 0.75% is
below the Comparable Group median at 1.04%. The Bank had a nonperforming assets
to assets ratio of 0.48%, is below the Comparable median of 0.76%. The Bank's
reserve level, 0.51% of total loans, is below the Comparable median of 0.71% of
loans. The Bank's level of reserves to NPLs is in-line with that of the
Comparable Group, due to the Bank's lower level of reserves and lower level of
NPLs.
Conversion Valuation Appraisal Report Page: 44
================================================================================
- ------------------------------ --------------- ---------------------------------
Positive Neutral Negative
- ------------------------------ --------------- ---------------------------------
Higher Deposits to Assets Capital Levels Lower Assets
Lower NPAs Lower Loan levels
Lower ALLL to Loans
The Bank has a less favorable asset mix relative to the Comparable Group.
Partially offsetting this factor, the Bank has a more favorable funding mix
relative to the Comparable Group. The Bank's current capital levels are below
the Comparable Group, but will be substantially higher after the conversion. The
Bank's ability to leverage the newly raised capital will be discussed in the
profitability section. The Bank has lower nonperforming loans, but lower
reserves. Taken collectively a slight downward adjustment is warranted.
Conversion Valuation Appraisal Report Page: 45
================================================================================
------------------------------------------
BALANCE SHEET GROWTH
------------------------------------------
The Bank's loan runoff is in-line with the Comparable median. Relative to the
Comparable median, the Bank is experiencing more deposit growth than the
Comparables.
FIGURE 33 - BALANCE SHEET GROWTH DATA
- --------------------------------------------------------------------------------------------
Balance Sheet Growth
-------------------------------------
Asset Loan Deposit
Growth Growth Growth
Rate Rate Rate
Ticker Short Name (%) (%) (%)
- --------------------------------------------------------------------------------------------
Comparable Thrift Data
ALFC Atlantic Liberty Financial Corp (4.63) 10.19 (28.71)
AMFC AMB Financial Corp. 1.32 2.28 5.51
CIBI Community Investors Bancorp, Inc. 0.04 (1.85) (0.15)
CKFB CKF Bancorp, Inc. 1.85 5.09 1.19
ESBK Elmira Savings Bank, FSB 2.61 (10.90) 1.64
FFDF FFD Financial Corporation 0.60 9.35 2.50
FKKY Frankfort First Bancorp, Inc. (0.62) (2.97) 1.31
FNFI First Niles Financial, Inc. 1.05 (4.45) 3.85
HWEN Home Financial Bancorp (9.57) (8.20) (12.39)
NBSI North Bancshares, Inc. (6.87) (3.18) (3.61)
PBNC PFS Bancorp, Inc. (3.06) 2.81 (3.35)
PSFC Peoples-Sidney Financial Corporation 5.46 (2.27) (1.62)
SZB SouthFirst Bancshares, Inc. (5.62) (8.81) (3.03)
UTBI United Tennessee Bankshares, Inc. 7.82 (0.53) 8.10
- --------------------------------------------------------------------------------------------
Average (0.69) (0.96) (2.05)
Median 0.32 (2.06) 0.52
Maximum 7.82 10.19 8.10
Minimum (9.57) (10.90) (28.71)
TBD SE Financial Corp. 2.47 (1.86) 3.23
Variance to the Comparable Median 2.15 0.20 2.71
- --------------------------------------------------------------------------------------------
Sources: SNL and Offering Circular Data, FinPro Computations
Conversion Valuation Appraisal Report Page: 46
================================================================================
- ------------------------------ ---------------------- --------------------------
Positive Neutral Negative
- ------------------------------ ---------------------- --------------------------
Higher Asset Growth Similar Loan Decline None
Higher Deposit Growth
A slight upward adjustment is warranted for this factor.
Conversion Valuation Appraisal Report Page: 47
================================================================================
-------------------------------------------
EARNINGS QUALITY, PREDICTABILITY AND GROWTH
-------------------------------------------
The earnings quality, predictability and growth are critical components in the
establishment of market values for thrifts. Thrift earnings are primarily a
function of:
o net interest income
o loan loss provision
o non-interest income
o non-interest expense
The quality and predictability of earnings is dependent on both internal and
external factors. Some internal factors include the mix of the balance sheet,
the interest rate sensitivity of the balance sheet, the asset quality, and the
infrastructure in place to deliver the assets and liabilities to the public.
External factors include the competitive market for both assets and liabilities,
the global interest rate scenario, local economic factors and regulatory issues.
Investors are focusing on earnings sustainability as interest rate volatility
has caused a wide variation in income levels. With the intense competition for
both assets and deposits, banks cannot easily replace lost spread and margin
with balance sheet growth.
Each of these factors can influence the earnings of an institution, and each of
these factors is volatile. Investors prefer stability and consistency. As such,
solid, consistent earnings are preferred to high but risky earnings. Investors
also prefer earnings to be diversified and not entirely dependent on interest
income.
Conversion Valuation Appraisal Report Page: 48
================================================================================
The Bank posted net income of $556 thousand for the year ended October 31, 2003,
compared with $529 thousand for the year ended October 31, 2002. The increase is
primarily attributable to lower noninterest expense and higher noninterest
income.
FIGURE 34 - NET INCOME CHART
[GRAPHIC OMITTED]
Source: Offering Prospectus
Conversion Valuation Appraisal Report Page: 49
================================================================================
The Bank's ROAA is below the Comparable Group median, but the Bank's ROAE is
above the Comparable Group median due to lower capital levels. The Bank's higher
capitalization following the offering is expected to reduce return on equity for
the near term. On a pro forma basis, the Bank's ROAA and ROAE are 0.58% and
2.64%, respectively.
FIGURE 35 - PROFITABILITY DATA
- --------------------------------------------------------------------------------
Profitability for the LTM
-------------------------
Return on Return on
Avg Assets Avg Equity
Ticker Short Name (%) (%)
- --------------------------------------------------------------------------------
Comparable Thrift Data
ALFC Atlantic Liberty Financial Corp 0.88 5.21
AMFC AMB Financial Corp. 0.78 9.66
CIBI Community Investors Bancorp, Inc. 0.87 8.27
CKFB CKF Bancorp, Inc. 1.03 10.21
ESBK Elmira Savings Bank, FSB 0.86 11.46
FFDF FFD Financial Corporation 0.73 5.87
FKKY Frankfort First Bancorp, Inc. 0.86 6.58
FNFI First Niles Financial, Inc. 1.06 6.00
HWEN Home Financial Bancorp 0.54 5.12
NBSI North Bancshares, Inc. 0.31 3.03
PBNC PFS Bancorp, Inc. 0.69 3.05
PSFC Peoples-Sidney Financial Corporation 0.62 5.03
SZB SouthFirst Bancshares, Inc. 0.08 0.91
UTBI United Tennessee Bankshares, Inc. 1.52 10.72
- -------------------------------------------------------------------------------
Average 0.77 6.51
Median 0.82 5.94
Maximum 1.52 11.46
Minimum 0.08 0.91
TBD SE Financial Corp. 0.64 7.23
Variance to the Comparable Median (0.18) 1.30
- -------------------------------------------------------------------------------
Sources: SNL and Offering Circular Data, FinPro Computations
Conversion Valuation Appraisal Report Page: 50
================================================================================
FIGURE 36 - INCOME STATEMENT DATA
Income Statement for the LTM
---------------------------------------------------------------------------------------
Yield on Net Net Noninterest Noninterest
Ave Earn Cost of Interest Interest Income/ Expense/ Efficiency Overhead
Assets Funds Spread Margin Avg Assets Avg Assets Ratio Ratio
Ticker Short Name (%) (%) (%) (%) (%) (%) (%) (%)
- ------------------------------------------------------------------------------------------------------------------------------------
Comparable Thrift Data
ALFC Atlantic Liberty Financial Corp 6.02 1.85 4.17 4.46 0.27 2.91 64.32 62.02
AMFC AMB Financial Corp. 6.29 3.04 3.25 3.31 1.05 2.81 68.70 57.91
CIBI Community Investors Bancorp, Inc. 5.81 2.94 2.87 3.13 0.43 2.13 60.91 55.48
CKFB CKF Bancorp, Inc. 5.88 3.01 2.87 3.10 0.14 1.55 49.33 46.98
ESBK Elmira Savings Bank, FSB 5.99 2.67 3.32 3.68 0.76 2.81 65.57 57.99
FFDF FFD Financial Corporation 4.98 2.39 2.59 2.87 0.74 2.37 66.45 57.72
FKKY Frankfort First Bancorp, Inc. 6.06 4.08 1.98 2.52 0.05 1.23 48.72 47.78
FNFI First Niles Financial, Inc. 5.46 2.74 2.72 3.20 0.05 1.85 58.08 57.41
HWEN Home Financial Bancorp 8.31 3.33 4.98 5.13 0.54 3.97 72.98 69.98
NBSI North Bancshares, Inc. 5.46 3.35 2.11 2.57 0.34 2.38 84.01 81.82
PBNC PFS Bancorp, Inc. 5.08 2.36 2.72 3.25 0.33 2.30 64.35 60.72
PSFC Peoples-Sidney Financial Corporation 6.19 3.41 2.78 3.16 0.10 2.18 68.12 67.12
SZB SouthFirst Bancshares, Inc. 6.09 2.93 3.16 3.19 2.57 5.01 92.38 85.38
UTBI United Tennessee Bankshares, Inc. 6.38 1.89 4.49 4.75 0.38 2.46 47.51 43.21
- ------------------------------------------------------------------------------------------------------------------------------------
Average 6.00 2.86 3.14 3.45 0.55 2.57 65.10 60.82
Median 6.01 2.94 2.87 3.20 0.36 2.38 64.96 57.95
Maximum 8.31 4.08 4.98 5.13 2.57 5.01 92.38 85.38
Minimum 4.98 1.85 1.98 2.52 0.05 1.23 47.51 43.21
TBD SE Financial Corp. 6.21 3.25 2.95 3.26 0.45 2.52 71.24 67.08
Variance to the Comparable Median 0.21 0.32 0.08 0.06 0.09 0.14 6.28 9.13
Sources: SNL and Offering Circular Data, FinPro Computations
Relative to the Comparable Group median, the Bank's yield on average earnings
assets was 21 basis points higher and the cost of funds was 32 basis points
higher. The Bank's net interest margin is 6 basis points above the Comparable
Group median. The Bank's noninterest income is 9 basis points higher and the
Bank's noninterest expense is 14 basis points higher.
The Bank's efficiency ratio of 71.24% is higher than the Comparable median of
64.96%.
On a forward looking basis, after the conversion the Bank's operating expenses
are expected to rise as a result of the stock benefit plans and additional costs
of being a public company. At the same time, the Bank will have additional
capital to deploy and leverage.
Conversion Valuation Appraisal Report Page: 51
================================================================================
- ----------------------------- ------------------- ------------------------------
Positive Neutral Negative
- ----------------------------- ------------------- ------------------------------
Higher ROAE None Lower ROAA
Higher Yield on Assets Higher Cost of Funds
Higher Net Margin Higher Noninterest Expense
Higher Noninterest Income Higher Efficiency Ratio
Higher Overhead Ratio
The Bank is less profitable than the Comparables. The Bank has slight advantages
in noninterest income and net interest margin, but also has a disadvantage in
noninterest expense. The Bank's efficiency ratio is above the Comparable Group.
Even after the conversion, the Bank is projected to have lower profitability
ratios relative to the Comparable Group. Taken collectively, a slight downward
adjustment is warranted for this factor.
Conversion Valuation Appraisal Report Page: 52
================================================================================
-------------------------------------------
MARKET AREA
-------------------------------------------
The market area that an institution serves has a significant impact on value, as
future success is interrelated with the economic, demographic and competitive
aspects of the market. The location of an institution will have an impact on the
trading value of an institution, as many analysts compare the pricing of
institutions relative to a state or regional multiples in investor
presentations.
Specifics on the Bank's markets were delineated in Section 2 - Market Area
Analysis. The following figure compares the demographic and competitive data for
the counties serviced by the Bank, to the county data of the Comparable Group
members.
FIGURE 37 - MARKET AREA DATA
Pop. Pop. Pop. Pop. Unemp. Per Market
Per Branch Growth Growth Density Rate Capita Income Share
2003 2000-2002 2002-2007 2002 Oct. 2003 2002 2003
Institution NaCounty County (actual) (%) (%) (per sq. mile) (%) ($) (%)
- ----------------------------------------------------------------------------------------------------------------------
Atlantic Liberty Financial Kings 7,269 0.55% 1.75% 35,108 9.20% $19,170 0.38%
- ----------------------------------------------------------------------------------------------------------------------
Deposit Weighted Market Data 7,269 0.55% 1.75% 35,108 9.20% $19,170
AMB Financial Corp. Lake 2,132 -0.58% -0.97% 969 5.80% $20,952 1.63%
- ----------------------------------------------------------------------------------------------------------------------
Deposit Weighted Market Data 2,132 -0.58% -0.97% 969 5.80% $20,952
CKF Bancorp Inc. Boyle 1,116 0.74% 2.03% 153 6.70% $21,679 17.26%
CKF Bancorp Inc. Garrard 2,179 3.10% 8.14% 66 5.70% $14,242 23.03%
- ----------------------------------------------------------------------------------------------------------------------
Deposit Weighted Market Data 1,412 1.40% 3.73% 129 6.42% $19,608
Community Investors Bancorp Crawford 1,789 -0.96% -2.13% 116 7.80% $18,226 12.33%
- ----------------------------------------------------------------------------------------------------------------------
Deposit Weighted Market Data 1,789 -0.96% -2.13% 116 7.80% $18,226
Elmira Savings Bank Chemung 2,492 -1.49% -3.56% 220 6.20% $19,726 17.41%
Elmira Savings Bank Tioga 1,806 0.38% 0.83% 37 4.10% $16,540 2.67%
- ----------------------------------------------------------------------------------------------------------------------
Deposit Weighted Market Data 2,452 -1.38% -3.30% 209 6.08% $19,538
FFD Financial Corp. Tuscarawas 1,952 0.93% 2.58% 162 5.60% $18,337 8.06%
- ----------------------------------------------------------------------------------------------------------------------
Deposit Weighted Market Data 1,952 0.93% 2.58% 162 5.60% $18,337
First Niles Financial Inc. Trumbell 2,145 -0.89% -1.99% 362 5.50% $19,860 1.87%
- ----------------------------------------------------------------------------------------------------------------------
Deposit Weighted Market Data 2,145 -0.89% -1.99% 362 5.50% $19,860
Frankfort First
Bancorp, Inc. Franklin 1,778 0.68% 2.09% 228 3.20% $25,926 5.79%
- ----------------------------------------------------------------------------------------------------------------------
Deposit Weighted Market Data 1,778 0.68% 2.09% 228 3.20% $25,926
Home Financial Bancorp Owen 3,755 3.42% 8.55% 58 5.00% $16,377 21.38%
Home Financial Bancorp Putnam 2,460 2.44% 6.26% 77 4.10% $18,945 1.09%
- ----------------------------------------------------------------------------------------------------------------------
Deposit Weighted Market Data 3,609 3.31% 8.29% 60 4.90% $16,667
North Bancshares, Inc. Cook 3,161 0.12% 0.75% 5,693 6.80% $27,774 0.06%
- ----------------------------------------------------------------------------------------------------------------------
Deposit Weighted Market Data 3,161 0.12% 0.75% 5,693 6.80% $27,774
Peoples-Sidney
Financial Corp. Shelby 1,721 0.61% 1.86% 118 4.20% $23,041 13.98%
- ----------------------------------------------------------------------------------------------------------------------
Deposit Weighted Market Data 1,721 0.61% 1.86% 118 4.20% $23,041
PFS Bancorp Inc. Dearborn 3,595 2.03% 5.55% 154 4.50% $21,960 9.18%
PFS Bancorp Inc. Ohio 18,531 0.12% 0.83% 65 4.00% $22,310 16.30%
PFS Bancorp Inc. Switzerland 7,178 2.34% 6.03% 42 5.50% $16,296 11.58%
- ----------------------------------------------------------------------------------------------------------------------
Deposit Weighted Market Data 5,489 1.91% 5.19% 129 4.60% $21,144
SouthFirst Bancshares Chilton 2,922 3.32% 7.65% 59 4.30% $17,908 6.37%
SouthFirst Bancsharse Talladega 3,213 0.01% 0.62% 109 9.80% $15,736 10.47%
- ----------------------------------------------------------------------------------------------------------------------
Deposit Weighted Market Data 3,100 1.30% 3.36% 90 7.66% $16,581
United Tennessee
Bancshares Cocke 2,622 1.56% 3.76% 78 6.10% $15,887 26.70%
- ----------------------------------------------------------------------------------------------------------------------
Deposit Weighted Market Data 2,622 1.56% 3.76% 78 6.10% $15,887
Comparable Median 2,298 0.64% 1.97% 146 5.94% $19,573
- ----------------------------------------------------------------------------------------------------------------------
St. Edmond's FSB Philadelphia 2,793 -1.36% -3.27% 11,081 7.80% $18,946 0.21%
St. Edmond's FSB Gloucester 2,396 1.60% 4.06% 797 5.10% $24,667 0.13%
- ----------------------------------------------------------------------------------------------------------------------
Deposit Weighted Market Data 2,768 -1.18% -2.82% 10,451 7.63% $19,297
Sources: SNL Securities, Claritas and US Bureau of Labor Statistics
Conversion Valuation Appraisal Report Page: 53
================================================================================
- ------------------------- ------------------------------- ----------------------
Positive Neutral Negative
- ------------------------- ------------------------------- ----------------------
Population Density Declining Population
Higher Unemployment
Lower Income Levels
The Bank's market area is experiencing and is projected to continue to
experience population decline, versus population growth for the Comparable
Group. The Bank's markets have substantially higher population density.
Unemployment levels are higher in the Bank's markets, indicating weaker economic
conditions. Per capita income levels are lower in the Bank's markets. Based upon
these factors, a slight downward adjustment is warranted for market area.
Conversion Valuation Appraisal Report Page: 54
================================================================================
-------------------------------------------
CASH DIVIDENDS
-------------------------------------------
The last few years have seen yet another shift away from dividend policies
concurrent with conversion. Recent issues have been fully or oversubscribing
without the need for the additional enticement of dividends. After the
conversion is another issue, however. Pressures on ROAE and on internal rate of
returns to investors prompted the industry toward cash dividends. This trend is
exacerbated by the lack of growth potential. Typically, when institutions are in
a growth mode, they issue stock dividends or do not declare a dividend. When
growth is stunted, these institutions shift toward reducing equity levels and
thus utilize cash dividends as a tool in managing equity. Recent tax code
changes have made cash dividends more attractive to investors.
FIGURE 38 - DIVIDEND DATA
Dividends
----------------------------
Current LTM Dividend
Dividend Payout
Yield Ratio
Ticker Short Name ($) (%)
- -------------------------------------------------------------------------------
Comparable Thrift Data
ALFC Atlantic Liberty Financial Corp 1.05 NA
AMFC AMB Financial Corp. 1.37 17.02
CIBI Community Investors Bancorp, Inc. 2.07 33.85
CKFB CKF Bancorp, Inc. 2.98 40.74
ESBK Elmira Savings Bank, FSB 2.45 30.00
FFDF FFD Financial Corporation 2.77 48.78
FKKY Frankfort First Bancorp, Inc. 5.04 121.74
FNFI First Niles Financial, Inc. 3.38 71.79
HWEN Home Financial Bancorp 1.93 46.15
NBSI North Bancshares, Inc. 2.21 110.81
PBNC PFS Bancorp, Inc. 1.49 46.61
PSFC Peoples-Sidney Financial Corporation 3.46 81.54
SZB SouthFirst Bancshares, Inc. 3.58 400.00
UTBI United Tennessee Bankshares, Inc. 1.69 25.00
- -------------------------------------------------------------------------------
Average 2.53 82.62
Median 2.33 46.61
Maximum 5.04 400.00
Minimum 1.05 17.02
TBD SE Financial Corp. NA NA
Variance to the Comparable Median NA NA
Sources: SNL and Offering Circular Data, FinPro Computations
Conversion Valuation Appraisal Report Page: 55
================================================================================
All Comparable institutions had declared cash dividends. The median dividend
payout ratio for the Comparable Group was 46.61%, ranging from a high of 400.00%
to a low of 17.02%. The Bank, on a pro forma basis (at the mid point of the
value range) will have an equity to assets ratio of 22.10%. The Bank will have
adequate capital and profits to pay cash dividends. As such, no adjustment is
indicated for this factor.
Conversion Valuation Appraisal Report Page: 56
================================================================================
-------------------------------------------
LIQUIDITY OF THE ISSUE
-------------------------------------------
The Comparable Group is by definition composed only of companies that trade in
the public markets with all of the Comparables trading on NASDAQ or AMEX.
Typically, the number of shares outstanding and the market capitalization
provide an indication of how much liquidity there will be in a given stock. The
actual liquidity can be measured by volume traded over a given period of time.
FIGURE 39 - MARKET CAPITALIZATION DATA
Market Data
-----------------------------------------------------------------------------
Publicly Tangible
Market Price Price Price Reported Publicly Rep
Value Per Share High Low Book Value Book Value
Ticker Short Name ($) ($) ($) ($) ($) ($)
- ---------------------------------------------------------------------------------------------------------------------------------
Comparable Thrift Data
ALFC Atlantic Liberty Financial Corp 32.47 18.98 20.28 18.01 15.12 15.12
AMFC AMB Financial Corp. 13.84 14.58 16.50 13.12 12.83 12.83
CIBI Community Investors Bancorp, Inc. 17.79 16.42 16.42 13.13 12.06 12.06
CKFB CKF Bancorp, Inc. 23.69 16.10 18.04 13.13 10.24 9.49
ESBK Elmira Savings Bank, FSB 32.20 31.01 31.50 28.70 20.89 20.32
FFDF FFD Financial Corporation 18.41 15.15 15.15 14.59 13.99 13.99
FKKY Frankfort First Bancorp, Inc. 28.02 22.21 22.37 19.79 14.23 14.23
FNFI First Niles Financial, Inc. 24.65 17.75 17.90 16.43 11.56 11.56
HWEN Home Financial Bancorp 8.42 6.21 6.40 5.46 5.02 5.02
NBSI North Bancshares, Inc. 16.60 14.50 15.00 12.75 11.81 11.81
PBNC PFS Bancorp, Inc. 29.61 20.09 20.80 17.89 18.04 18.04
PSFC Peoples-Sidney Financial Corporation 23.32 16.20 16.20 13.25 12.11 12.11
SZB SouthFirst Bancshares, Inc. 12.12 16.75 17.75 15.85 16.13 15.38
UTBI United Tennessee Bankshares, Inc. 24.22 19.50 19.50 15.09 13.19 12.54
- ---------------------------------------------------------------------------------------------------------------------------------
Average 21.81 17.53 18.13 15.51 13.37 13.18
Median 23.51 16.59 17.83 14.84 13.01 12.69
Maximum 32.47 31.01 31.50 28.70 20.89 20.32
Minimum 8.42 6.21 6.40 5.46 5.02 5.02
TBD SE Financial Corp. 17.50 NA NA NA NA NA
Variance to the Comparable Median (6.01) NA NA NA NA NA
Sources: SNL and Offering Circular Data, FinPro Computations
The market capitalization values of the Comparable Group range from a low of
$8.4 million to a high of $32.5 million with a median market capitalization of
$23.5 million. The Bank expects to have $17.5 million of market capital at the
midpoint on a pro forma basis.
The Bank will trade over-the-counter rather than on a major exchange and is
expected to have slightly lower trading liquidity.
Conversion Valuation Appraisal Report Page: 57
================================================================================
FIGURE 40 - PINK SHEET TRADING DISCOUNT
- --------------------------------------------------------------------------------------------------
Price to Price to
LTM Core Earnings Tangible Book
National
National Liquidly Traded Fully Converted 17.45 158.77%
National Pink Sheet Fully Converted 14.71 110.89%
-------------------------------------------------------------------------------
Premium/(Discount) -15.70% -30.16%
A downward adjustment is warranted for this factor.
Conversion Valuation Appraisal Report Page: 58
================================================================================
-------------------------------------------
RECENT REGULATORY MATTERS
-------------------------------------------
Regulatory matters influence the market for thrift conversions. Recently, the
OTS has issued revised rules on conversions. The major emphasis of the revised
rules is to make MHCs more attractive.
The OTS allows for dividend waivers without any dilution to the minority
shareholders. The OTS relaxed its repurchase restrictions after the first year,
and now allows for additional benefits to insiders when the minority issuance is
less than 49.00%. Offsetting these factors is the OTS prohibition of mergers
within three years of conversion. None of these factors will impact fully
converted institutions.
Taken collectively, no adjustment for this factor is warranted as both the Bank
and the Comparables will operate in the same ownership structure and will be
supervised in the same regulatory environment.
Conversion Valuation Appraisal Report Page: 59
================================================================================
-------------------------------------------
MANAGEMENT
-------------------------------------------
The Bank has recently had a regulatory agreement lifted due to past problems.
There is a new management team and four new directors appointed since January
2000.
The Bank's ROAA is below the Comparable Group's ratio, which would indicate
slightly weaker management of the Bank's asset base.
The Bank's organizational chart is reasonable for an institution of its size and
complexity. The Board is active and oversees and advises on all key strategic
and policy decisions.
As such, a modest downward adjustment appears to be warranted for this factor.
Conversion Valuation Appraisal Report Page: 60
================================================================================
-------------------------------------------
SUBSCRIPTION INTEREST
-------------------------------------------
The appreciation of both thrift stocks and the U.S. equity market in general,
through the first half of 1998, shifted a significant level of attention to the
market for initial public offerings ("IPOs"). Thrift IPOs received a greater
amount of attention due to the price "pops" of standard conversions. With the
market downturn of latter 1998, the number of thrift conversions and subsequent
interest in thrift conversions declined through 2000.
This drop in interest created a corresponding drop in conversion pricing in
order to entice interest in the thrift IPOs. During 1996, rates increased
slightly and then remained stable, fueling the rise in the conversion prices.
1997 saw a continuation of this trend, with the median IPO pricing at 71.1%,
71.4%, 73.0%, and 77.2% of book value for the first, second, third, and fourth
quarters of 1997, respectively. Pricing peaked during 1998 with 78.4%, 76.0%,
77.8%, and 63.4% of book value in the first, second, third, and fourth quarters
of that year, respectively. The pro forma price to book multiples started to
decline during 1999 and the first, second, and fourth quarters of 1999 were
69.58%, 62.45%, and 56.46%, respectively (there were no institutions that began
trading in the third quarter). Pricing multiples also fell through the second
quarter in 2000. Multiples began to rise in the third quarter of 2000 and
continued to rise through 2002. The median pro forma price to book multiples for
the first, second, third and fourth quarters of 2002 were 62.46%, 66.30%, 71.22%
and 72.04%, respectively. The multiples for 2003 were off slightly, however,
there have been only six completed standard conversions.
Conversion Valuation Appraisal Report Page: 61
================================================================================
FIGURE 41 - STANDARD CONVERSION PRO FORMA PRICING MULTIPLES
-------------------------------------------------
Price to Pro Forma
-------------------------------------------------
Pro Forma Pro Forma Pro Forma Adjusted
IPO Book Value Tang. Book Earnings Assets
Ticker Short Name Date (%) (%) (x) (%)
- -----------------------------------------------------------------------------------------------------------------------
KNBT KNBT Bancorp, Inc. 11/03/2003 53.92 53.92 14.90 16.4
RPFG Rainier Pacific Financial Group, Inc. 10/21/2003 71.97 72.14 30.90 13.0
---------------------------------------------------------------------------------------------------------
Q3`03 Average 62.95 63.03 22.90 14.70
Median 62.95 63.03 22.90 14.70
---------------------------------------------------------------------------------------------------------
CFBC Community First Bancorp, Inc. 06/27/2003 67.24 67.24 NA 8.5
RFBK Rantoul First Bank, SB 04/02/2003 58.46 58.46 NA 5.9
---------------------------------------------------------------------------------------------------------
Q2`03 Average 62.85 62.85 NA 7.20
Median 62.85 62.85 NA 7.20
---------------------------------------------------------------------------------------------------------
PFS Provident Financial Services, Inc. 01/16/2003 72.14 74.17 17.50 16.3
CCFC CCSB Financial Corp. 01/09/2003 67.17 67.17 94.20 11.2
---------------------------------------------------------------------------------------------------------
Q1`03 Average 69.66 70.67 55.85 13.75
Median 69.66 70.67 55.85 13.75
---------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------
2003 YTD Average 65.15 65.52 39.38 11.88
Median 67.21 67.21 24.20 12.10
---------------------------------------------------------------------------------------------------------
ALFC Atlantic Liberty Financial Corp 10/23/2002 74.08 74.08 14.60 12.1
TONE TierOne Corporation 10/02/2002 70.00 70.00 12.70 12.5
---------------------------------------------------------------------------------------------------------
Q4`02 Average 72.04 72.04 13.65 12.30
Median 72.04 72.04 13.65 12.30
---------------------------------------------------------------------------------------------------------
MCBF Monarch Community Bancorp, Inc. 08/30/2002 66.18 66.18 41.50 11.8
FPTB First PacTrust Bancorp, Inc. 08/23/2002 76.25 76.25 28.20 15.4
---------------------------------------------------------------------------------------------------------
Q3`02 Average 71.22 71.22 34.85 13.60
Median 71.22 71.22 34.85 13.60
---------------------------------------------------------------------------------------------------------
RSVB Reserve Bancorp, Inc. 04/08/2002 66.30 66.30 17.30 14.4
---------------------------------------------------------------------------------------------------------
Q2`02 Average 66.30 66.30 17.30 14.40
Median 66.30 66.30 17.30 14.40
---------------------------------------------------------------------------------------------------------
HRGB Heritage Bancshares, Inc. 02/26/2002 62.46 62.46 11.60 10.9
---------------------------------------------------------------------------------------------------------
Q1`02 Average 62.46 62.46 11.60 10.90
Median 62.46 62.46 11.60 10.90
---------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------
2002 Average 69.21 69.21 20.98 12.85
Median 68.15 68.15 15.95 12.30
---------------------------------------------------------------------------------------------------------
AFBA Allied First Bancorp, Inc. 12/31/2001 63.98 63.98 7.50 6.9
CSFC City Savings Financial Corp. 12/28/2001 58.37 58.37 9.10 7.7
PBNC PFS Bancorp, Inc. 10/12/2001 57.45 57.45 16.20 11.8
---------------------------------------------------------------------------------------------------------
Q4`01 Average 59.93 59.93 10.93 8.80
Median 58.37 58.37 9.10 7.70
---------------------------------------------------------------------------------------------------------
GLBP Globe Bancorp, Inc. 07/10/2001 54.08 54.08 26.60 10.9
---------------------------------------------------------------------------------------------------------
Q3`01 Average 54.08 54.08 26.60 10.90
Median 54.08 54.08 26.60 10.90
---------------------------------------------------------------------------------------------------------
BAFI BancAffiliated, Inc. 06/01/2001 59.91 59.91 11.30 8.6
CFSL Chesterfield Financial Corp. 05/02/2001 59.90 60.47 11.00 12.4
FBTC First BancTrust Corporation 04/19/2001 59.41 59.41 10.40 8.2
---------------------------------------------------------------------------------------------------------
Q2`01 Average 59.74 59.93 10.90 9.73
Median 59.90 59.91 11.00 8.60
---------------------------------------------------------------------------------------------------------
BUCS BUCS Financial Corp 03/15/2001 45.30 45.30 13.40 5.4
CTZN Citizens First Bancorp, Inc. 03/07/2001 64.22 64.22 9.60 10.6
---------------------------------------------------------------------------------------------------------
Q1`01 Average 54.76 54.76 11.50 8.00
Median 54.76 54.76 11.50 8.00
---------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------
2001 Average 58.07 58.13 12.79 9.17
Median 59.41 59.41 11.00 8.60
---------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------
1/1/2001 to Average 63.28 63.41 20.97 11.00
1/20/04 Median 63.98 63.98 14.60 11.20
---------------------------------------------------------------------------------------------------------
Source: SNL Securities and FinPro calculations
Conversion Valuation Appraisal Report Page: 62
================================================================================
Despite the rise in multiples between 2001 and 2003, the first day pop rose over
that time period.
FIGURE 42 - AFTER MARKET PERFORMANCE
-------------------------------------------------------------
Percent Change from IPO
-------------------------------------------------------------
After After After After
IPO 1 Day 1 Week 1 Month 3 Months To date
Ticker Short Name Date (%) (%) (%) (%) (%)
- -----------------------------------------------------------------------------------------------------------------------------------
KNBT KNBT Bancorp, Inc. 11/03/2003 68.80 68.20 69.70 NA 75.50
RPFG Rainier Pacific Financial Group, Inc. 10/21/2003 69.90 65.20 61.00 NA 60.90
---------------------------------------------------------------------------------------------------------------------
Q3`03 Average 69.35 66.70 65.35 NA 68.20
Median 69.35 66.70 65.35 NA 68.20
---------------------------------------------------------------------------------------------------------------------
CFBC Community First Bancorp, Inc. 06/27/2003 20.00 20.30 20.50 22.00 58.70
RFBK Rantoul First Bank, SB 04/02/2003 15.10 20.00 23.50 28.00 100.00
---------------------------------------------------------------------------------------------------------------------
Q2`03 Average 17.55 20.15 22.00 25.00 79.35
Median 17.55 20.15 22.00 25.00 79.35
---------------------------------------------------------------------------------------------------------------------
PFS Provident Financial Services, Inc. 01/16/2003 55.00 55.20 51.50 61.10 85.60
CCFC CCSB Financial Corp. 01/09/2003 20.00 23.10 25.00 25.00 60.50
---------------------------------------------------------------------------------------------------------------------
Q1`03 Average 37.50 39.15 38.25 43.05 73.05
Median 37.50 39.15 38.25 43.05 73.05
---------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------
2003 YTD Average 41.47 42.00 41.87 34.03 73.53
Median 37.50 39.15 38.25 26.50 68.20
---------------------------------------------------------------------------------------------------------------------
ALFC Atlantic Liberty Financial Corp 10/23/2002 30.20 31.60 33.30 40.00 89.80
TONE TierOne Corporation 10/02/2002 40.00 37.00 39.20 51.60 134.80
---------------------------------------------------------------------------------------------------------------------
Q4`02 Average 35.10 34.30 36.25 45.80 112.30
Median 35.10 34.30 36.25 45.80 112.30
---------------------------------------------------------------------------------------------------------------------
MCBF Monarch Community Bancorp, Inc. 08/30/2002 16.80 14.00 1.10 14.10 60.20
FPTB First PacTrust Bancorp, Inc. 08/23/2002 18.58 21.50 18.75 28.33 84.17
---------------------------------------------------------------------------------------------------------------------
Q3`02 Average 17.69 17.75 9.93 21.22 72.18
Median 17.69 17.75 9.93 21.22 72.18
---------------------------------------------------------------------------------------------------------------------
RSVB Reserve Bancorp, Inc. 04/08/2002 25.00 28.00 29.00 29.00 97.50
---------------------------------------------------------------------------------------------------------------------
Q2`02 Average 25.00 28.00 29.00 29.00 97.50
Median 25.00 28.00 29.00 29.00 97.50
---------------------------------------------------------------------------------------------------------------------
HRGB Heritage Bancshares, Inc. 02/26/2002 20.50 17.50 15.10 22.00 153.50
---------------------------------------------------------------------------------------------------------------------
Q1`02 Average 20.50 17.50 15.10 22.00 153.50
Median 20.50 17.50 15.10 22.00 153.50
---------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------
2002 Average 25.18 24.93 22.74 30.84 103.33
Median 22.75 24.75 23.88 28.67 93.65
---------------------------------------------------------------------------------------------------------------------
AFBA Allied First Bancorp, Inc. 12/31/2001 19.00 18.50 19.20 21.00 60.00
CSFC City Savings Financial Corp. 12/28/2001 22.00 22.50 27.50 40.00 177.40
PBNC PFS Bancorp, Inc. 10/12/2001 21.50 24.50 24.50 36.10 100.90
---------------------------------------------------------------------------------------------------------------------
Q4`01 Average 20.83 21.83 23.73 32.37 112.77
Median 21.50 22.50 24.50 36.10 100.90
---------------------------------------------------------------------------------------------------------------------
GLBP Globe Bancorp, Inc. 07/10/2001 13.12 10.60 11.00 8.50 85.00
---------------------------------------------------------------------------------------------------------------------
Q3`01 Average 13.12 10.60 11.00 8.50 85.00
Median 13.12 10.60 11.00 8.50 85.00
---------------------------------------------------------------------------------------------------------------------
BAFI BancAffiliated, Inc. 06/01/2001 0.00 0.00 7.50 7.50 120.00
CFSL Chesterfield Financial Corp. 05/02/2001 36.50 39.90 43.50 57.00 153.10
FBTC First BancTrust Corporation 04/19/2001 13.20 12.90 21.10 31.00 139.99
---------------------------------------------------------------------------------------------------------------------
Q2`01 Average 16.57 17.60 24.03 31.83 137.70
Median 13.20 12.90 21.10 31.00 139.99
---------------------------------------------------------------------------------------------------------------------
BUCS BUCS Financial Corp 03/15/2001 30.00 36.25 36.87 52.50 145.00
CTZN Citizens First Bancorp, Inc. 03/07/2001 38.13 35.00 32.50 50.60 128.90
---------------------------------------------------------------------------------------------------------------------
Q1`01 Average 34.07 35.63 34.69 51.55 136.95
Median 34.07 35.63 34.69 51.55 136.95
---------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------
2001 Average 21.49 22.24 24.85 33.80 123.37
Median 21.50 22.50 24.50 36.10 128.90
---------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------
1/1/2001 to Average 28.25 28.65 29.11 32.91 103.40
1/20/04 Median 21.50 23.10 25.00 29.00 97.50
---------------------------------------------------------------------------------------------------------------------
Source: SNL Securities and FinPro calculations
Based on the above, a substantial upward adjustment for subscription interest is
warranted at this time.
Conversion Valuation Appraisal Report Page: 63
================================================================================
-------------------------------------------
VALUATION ADJUSTMENTS
-------------------------------------------
Relative to the Comparables, the following adjustments need to be made to the
Bank's pro forma market value.
Valuation Factor Valuation Adjustment
- -------------------------------------------------------- -----------------------
Financial Condition Slight Downward
Balance Sheet Growth Slight Upward
Earnings Quality, Predictability and Growth Slight Downward
Market Area Slight Downward
Dividends No Adjustment
Liquidity of the Issue Downward
Recent Regulatory Matters No Adjustment
Additionally, the following adjustment should be made to the Bank's market
value.
Valuation Factor Valuation Adjustment
- -------------------------------------------------------- -----------------------
Management Modest Downward
Subscription Interest Substantial Upward
Conversion Valuation Appraisal Report Page: 64
================================================================================
5. Valuation
In applying the accepted valuation methodology promulgated by the regulators,
i.e., the pro forma market value approach, four key pricing multiples were
considered. The three multiples include:
Price to earnings ("P/E")
Price to book value ("P/B")
Price to assets ("P/A")
All of the approaches were calculated on a pro forma basis including the effects
of the conversion proceeds. All of the assumptions utilized are presented in
Exhibit 10.
-------------------------------------------
DISCUSSION OF WEIGHT GIVEN TO
VALUATION MULTIPLES
-------------------------------------------
To ascertain the pro forma estimated market value of the Bank, the market
multiples for the Comparable Group were utilized. As a secondary check, all
Pennsylvania public thrifts, all publicly traded thrifts and the recent (2001 to
date) and historical standard conversions were assessed. The multiples for the
Comparable Group, all publicly traded thrifts, and Pennsylvania publicly traded
thrifts are shown in Exhibit 7.
Price to Earnings - According to the OTS Appraisal Guidelines: "When
-----------------
both the converting institution and the comparable companies are
recording "normal" earnings. A P/E approach may be the simplest and
most direct method of valuation. When earnings are low or negative,
however, this approach may not be appropriate and the greater
consideration should be given to the P/BV approach." In this particular
case, the Bank's earnings are "normal". As a basis for comparison, the
price to core earnings was utilized for both the Bank and the
Comparable Group to eliminate any nonrecurring items. As such, this
approach is applicable, meaningful and appropriate in this appraisal.
Conversion Valuation Appraisal Report Page: 65
================================================================================
Price to Book/Price to Tangible Book - According to the OTS Appraisal
--------------------------------------
Guidelines: "The P/BV approach works best when the converting
institution and the Comparables have a normal amount of book value. The
P/BV approach could seriously understate the value of an institution
that has almost no book value but has an outstanding future earnings
potential. For converting institutions with high net worth, the
appraiser may have difficulty in arriving at a pro forma market value
because of pressure placed on the P/E multiple as higher P/BV levels
are required to reflect a similar P/BV ratio as the peer group average.
The P/BV approach also suffers from the use of historical cost
accounting data."
Since thrift earnings in general have had a high degree of volatility
over the past decade, the P/B is utilized frequently as the benchmark
for market value. A better approach is the P/TB approach. In general,
investors tend to price financial institutions on a tangible book
basis, because it incorporates the P/B approach adjusted for
intangibles. Initially following conversion, FinPro feels that thrifts
often trade on a price to tangible book basis. Currently, the Bank and
the Comparable Group have normal levels of capital, however, after the
conversion the Bank is expected to have a substantial excess level of
capital.
Price to Assets - According to the OTS Appraisal Guidelines: "This
---------------
approach remedies the problems of a small base that can occur with the
P/BV approach, but the approach has many of the other limitations of
the latter approach (the P/BV approach)." FinPro places little weight
on this valuation approach due to the lack of consideration of asset
and funding mixes and the resulting earnings impact.
In conclusion, in estimating the market value for the Bank, the most weight was
placed on the P/TB approach followed closely by the P/E approach. The P/B was
given much less weight and the P/A ratio was not given much weight at all.
Conversion Valuation Appraisal Report Page: 66
================================================================================
-------------------------------------------
OFFERING VALUE IN RELATION TO COMPARABLES
-------------------------------------------
Based upon the premiums and discounts defined in the section above, the Bank
pricing at the midpoint for a full standard conversion is estimated to be
$17,500,000. Based upon a range below and above the midpoint value, the relative
values are $14,875,000 at the minimum and $20,125,000 at the maximum,
respectively. At the super maximum of the estimated value range, the offering
value would be $23,143,750.
At the various levels of the estimated value range, the full offering would
result in the following offering data:
FIGURE 43 - VALUE RANGE - FULL OFFERING
- ----------------------------------------------------------------------------
Total Shares Price Total
Conclusion Shares Per Share Value
- ---------- ------ --------- -----
- ----------------------------------------------------------------------------
Appraised Value - Midpoint 1,750,000 $ 10.00 $ 17,500,000
Range:
- Minimum 1,487,500 10.00 14,875,000
- Maximum 2,012,500 10.00 20,125,000
- Super Maximum 2,314,375 10.00 23,143,750
Source: FinPro Inc. Pro Forma Model
This equates to the following multiples:
FIGURE 44 - VALUE RANGE PRICING MULTIPLES
-----------------------------------------------------------------------------------
Bank Comparables State National
-----------------------------------------------------------------------------------
Mean Median Mean Median Mean Median
Min 25.64
Price-Core Earnings Ratio P/E Mid 30.30 22.42 18.48 20.88 20.82 19.95 17.45
- ----------------------------- Max 33.33
Smax 38.46
Min 73.15%
Price-to-Book Ratio P/B Mid 77.40% 131.59% 129.65% 183.35% 171.98% 170.83% 154.27%
- ----------------------- Max 80.84%
Smax 84.10%
Min 73.15%
Price-to-Tangible Book Ratio P/TB Mid 77.40% 133.68% 129.65% 194.14% 180.61% 180.85% 158.77%
- --------------------------------- Max 80.84%
Smax 84.10%
Min 14.87%
Price-to-Assets Ratio P/A Mid 17.11% 16.29% 15.44% 13.38% 12.37% 15.88% 14.91%
- ------------------------- Max 19.24%
Smax 21.59%
Source: FinPro Inc. Pro Forma Model
Conversion Valuation Appraisal Report Page: 67
================================================================================
FIGURE 45 - COMPARABLE PRICING MULTIPLES TO THE BANK'S PRO FORMA MIDPOINT
--------------------------------------------------------------
Price Relative to
--------------------------------------------------------------
Earnings Core Earnings Book Tangible Book Assets
--------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
The Bank (at midpoint) Full Conversion 27.03 30.30 77.40% 77.40% 17.11%
- ----------------------------------------------------------------------------------------------------------
Comparable Group Median 20.62 18.48 129.65% 129.65% 15.44%
- ----------------------------------------------------------------------------------------------------------
(Discount)/Premium for Other Factors 31.09% 63.96% -40.30% -40.30% 10.85%
- ----------------------------------------------------------------------------------------------------------
Source: FinPro Calculations
Figure 45 illustrates that at the midpoint of the estimated valuation range the
Bank is priced at a 63.96% premium to the Comparable median price to core
earnings multiple. On a tangible book basis, the Bank is priced at a 40.30%
discount.
FIGURE 46 - COMPARABLE PRICING MULTIPLES TO THE BANK'S PRO FORMA SUPER MAXIMUM
-------------------------------------------------------------------
Price Relative to
-------------------------------------------------------------------
Earnings Core Earnings Book Tangible Book Assets
- --------------------------------------------------------------------------------------------------------------------
The Bank (at the supermax) Full Conversion 34.48 38.46 84.10% 84.10% 21.59%
- --------------------------------------------------------------------------------------------------------------------
Comparable Group Median 20.62 18.48 129.65% 129.65% 15.44%
- --------------------------------------------------------------------------------------------------------------------
(Discount)/Premium for Other Factors 67.22% 108.12% -35.13% -35.13% 39.88%
- --------------------------------------------------------------------------------------------------------------------
Source: FinPro Calculations
Figure 46 illustrates that at the super maximum of the estimated valuation range
the Bank is priced at a 108.12% premium to the Comparable median price to core
earnings multiple. On a tangible book basis, the Bank is priced at a 35.13%
discount.
Conversion Valuation Appraisal Report Page: 68
================================================================================
-------------------------------------------
VALUATION CONCLUSION
-------------------------------------------
Based on the pricing of the Bank relative to the Comparable Group on an earnings
and book basis, a comparison to other current standard conversions, and a
comparison to other high tangible equity full conversions, FinPro believes that
the valuation range recommended is appropriate.
It is, therefore, our opinion that as of January 20, 2004, the estimated pro
forma market value of the Bank, in a full offering, is $17,500,000 at the
midpoint of a range, with a minimum of $14,875,000 to a maximum of $20,125,000
at 15% below and 15% above the midpoint of the range respectively. Assuming an
adjusted maximum value of 15% above the maximum value, the adjusted maximum
value, or super maximum value, in a full offering is $23,143,750. The stock will
be issued at $10.00 per share.
Pro forma comparisons of the Bank's value range with the Comparable Group, all
public thrifts, and Pennsylvania public thrifts are shown in Exhibits 10 and 11.
The document represents an initial valuation for the Bank. Due to the duration
of time that passes between the time this document is compiled and the time the
offering closes, numerous factors could lead FinPro to update or revised the
appraised value of the Bank. Some factors that could lead FinPro to adjust the
appraised value include: (1) changes in the Bank's operations and financial
condition; (2) changes in the market valuation or financial condition of the
Comparable Group; (3) changes in the broader market; and (4) changes in the
market for thrift conversions. Should there be material changes to any of these
factors, FinPro will prepare an appraisal update to appropriately adjust the
value of the Bank. At the time of closing, FinPro will prepare a final appraisal
to determine if the valuation range is still appropriate and determine the exact
valuation amount appropriate for the Bank.
- --------------------------------------------------------------------------------
EXHIBIT 1
ABOUT THE FIRM
- --------------------------------------------------------------------------------
[GRAPHIC OMITTED]
Donald J. Musso
President
Donald founded FinPro, Inc. in 1987 as a consulting and investment banking firm
located in New Jersey that specializes in providing advisory services to the
financial institutions industry.
Mr. Musso has a broad background in capital markets, bank valuations, enhancing
franchise value, corporate finance, mergers and acquisitions, asset/liability
management, strategic planning, market feasibility and differentiation, branch
acquisition and sales, branch profitability, financial modeling and analysis,
balance sheet restructuring, product and segment profitability, business
development and project management. Besides his consulting experience, he has
solid industry experience, having worked for two multi billion asset, east coast
financial institutions.
Mr. Musso has provided expert testimony on financial institutions matters for
the Federal Bankruptcy Court, the Office of Thrift Supervision and the United
States Attorney's Office.
He is a frequent speaker on Financial Institution related topics and has
assisted trade groups in various activities. Mr. Musso is also on the faculty of
Stonier Graduate School of Banking, teaching Strategic Planning and Mergers and
Acquisitions.
Prior to establishing FinPro, Donald had direct industry experience having
managed the Corporate Planning and Mergers and Acquisitions departments for
Meritor Financial Group, a $20 billion institution in Philadelphia. Before that,
he had responsibility for the banking, thrift and real estate consulting
practice in the State of New Jersey for Deloitte Haskins & Sells. Donald began
his career with Goldome Savings Bank.
Donald has a B.S. in Finance from Villanova University and a M.B.A. in Finance
from Fairleigh Dickinson University.
- --------------------------------------------------------------------------------
[GRAPHIC OMITTED] P.O. Box 323 o Liberty Corner o NJ o 07938
Phone: 908 / 604-9336
Fax: 908 / 604-5951
e-mail: finpro@finpronj.com
Website: finpronj.com
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
EXHIBIT 1
ABOUT THE FIRM
- --------------------------------------------------------------------------------
[GRAPHIC OMITTED]
Dennis E. Gibney, CFA
Managing Director
Dennis joined FinPro in June of 1996.
Dennis manages all of the firm's capital markets engagements including mergers
and acquisitions, stock valuations and fairness opinions. In 2003, Dennis taught
the American Bankers Association's Merger and Acquisition Course. Dennis has
worked on the appraisal of over $2.0 billion in thrift conversion IPOs, the most
notable being that of Roslyn Bancorp, Inc. He has also prepared expert witness
testimony for litigation involving corporate appraisal methodology.
Dennis' areas of expertise include financial modeling, merger accounting,
security valuation, interest rate risk analysis, portfolio management and
competitive analysis.
Prior to joining the firm, Dennis received broad-based experience in the
securities industry. He worked as an Allocations Specialist for Merrill Lynch &
Company, supporting their mortgage-backed securities trading desk in New York
and for Sandler O'Neill & Partners, where he provided sales and trade support.
Dennis earned a B.S. from Babson College with a triple-major in Finance,
Investments and Economics.
- --------------------------------------------------------------------------------
[GRAPHIC OMITTED] P.O. Box 323 o Liberty Corner o NJ o 07938
Phone: 908 / 604-9336
Fax: 908 / 604-5951
e-mail: finpro@finpronj.com
Website: finpronj.com
- --------------------------------------------------------------------------------
EXHIBIT 2.
CONSOLIDATED BALANCE SHEET
October 31,
2003 2002
----------------- -----------------
ASSETS
Cash and due from banks $ 675,001 $ 4,343,329
Interest-bearing deposits with other institutions 5,628,890 2,957,378
----------------- -----------------
Cash and cash equivalents 6,303,891 7,300,707
Certificates of deposit in other financial institutions 183,483 178,744
Investment securities available for sale 27,337,238 23,491,988
Loans receivable (net of allowance for loan losses
of $262,561 and $266,700) 50,729,660 51,689,179
Accrued interest receivable 482,538 495,369
Federal Home Loan Bank stock 735,000 642,100
Real estate owned 38,881 25,000
Premises and equipment, net 1,148,993 1,124,397
Other assets 407,622 313,669
----------------- -----------------
TOTAL ASSETS $ 87,367,306 $ 85,261,153
================= =================
LIABILITIES AND RETAINED EARNINGS
Deposits $ 72,272,834 $ 70,015,110
Federal Home Loan Bank borrowings 6,637,204 6,694,342
Advances by borrowers for taxes and insurance 477,386 565,950
Accrued interest payable 49,703 74,126
Other liabilities 258,521 524,734
----------------- -----------------
TOTAL LIABILITIES 79,695,648 77,874,262
----------------- -----------------
Commitments and contingencies (Note 9)
Retained earnings - substantially restricted 7,755,558 7,199,733
Accumulated other comprehensive income (loss) (83,900) 187,158
----------------- -----------------
TOTAL RETAINED EARNINGS 7,671,658 7,386,891
----------------- -----------------
TOTAL LIABILITIES AND RETAINED EARNINGS $ 87,367,306 $ 85,261,153
================= =================
See accompanying notes to the consolidated financial statements.
2
Exhibit 3.
CONSOLIDATED STATEMENT OF INCOME
Year Ended October 31,
2003 2002
-------------- -------------
INTEREST AND DIVIDEND INCOME
Loans receivable $ 3,934,009 $ 4,649,646
Investment securities:
Taxable 1,034,380 1,075,990
Exempt from federal income tax
76,690 18,502
Interest-bearing deposits with other institutions
57,321 67,672
Other dividend income
17,589 25,678
-------------- -------------
Total interest and dividend income 5,119,989 5,837,488
-------------- -------------
INTEREST EXPENSE
Deposits 2,227,809 2,705,330
Federal Home Loan Bank borrowings 221,872 294,229
-------------- -------------
Total interest expense 2,449,681 2,999,559
-------------- -------------
NET INTEREST INCOME 2,670,308 2,837,929
Provision for loan losses
33,000 25,000
-------------- -------------
NET INTEREST INCOME AFTER PROVISION
FOR LOAN LOSSES 2,637,308 2,812,929
-------------- -------------
NONINTEREST INCOME
Service fees on deposit accounts 319,052 302,872
Other
66,780 62,479
-------------- -------------
Total noninterest income 385,832 365,351
-------------- -------------
NONINTEREST EXPENSE
Compensation and employee benefits 1,094,923 1,164,884
Occupancy and equipment 271,647 387,215
Real estate operations, net
15,377 (59,119)
Federal deposit insurance premiums
44,859 74,234
Data processing expense 296,342 289,646
Professional fees
96,465 76,934
Other 357,717 351,703
-------------- -------------
Total noninterest expense 2,177,330 2,285,497
-------------- -------------
Income before income taxes 845,810 892,783
Income taxes 289,985 363,999
-------------- -------------
NET INCOME $ 555,825 $ 528,784
============== =============
See accompanying notes to the consolidated financial statements.
3
EXHIBIT 4.
CONSOLIDATED STATEMENT OF CHANGES IN RETAINED EARNINGS
Retained Accumulated
Earnings Other Total
Substantially Comprehensive Retained Comprehensive
Restricted Income (Loss) Earnings Income
--------------- -------------- -------------- -------------
Balance, October 31, 2001 $ 6,670,949 $ 185,310 $ 6,856,259
Net income 528,784 528,784 $ 528,784
Other comprehensive income:
Unrealized gain on available
for sale securities
net of taxes of $1,267 1,848 1,848 1,848
----------
Comprehensive income $ 530,632
---------- ---------- ------------ ==========
Balance, October 31, 2002 7,199,733 187,158 7,386,891
Net income 55,825 555,825 555,825
Other comprehensive income:
Unrealized loss on available
for sale securities
net of tax benefit of $163,887 (271,058) (271,058) (271,058)
----------
Comprehensive income $ 284,767
---------- ---------- ------------ ==========
Balance, October 31, 2003 $ 7,755,558 $ (83,900) $ 7,671,658
========== ========== ============
See accompanying notes to the consolidated financial statements.
4
EXHIBIT 5.
CONSOLIDATED STATEMENT OF CASH FLOWS
Year Ended October 31,
2003 2002
------------ ------------
OPERATING ACTIVITIES
Net income $ 555,825 $ 528,784
Adjustments to reconcile net income to net cash provided
by operating activities:
Provision for loan losses 33,000 25,000
Depreciation, amortization, and accretion 167,784 172,683
Deferred federal income taxes 77,339 25,571
Decrease in accrued interest receivable 12,831 24,069
Decrease in accrued interest payable (24,423) (43,296)
Other, net (218,021) (200,475)
------------ -------------
Net cash provided by operating activities 604,335 532,336
------------ -------------
INVESTING ACTIVITIES
Investment securities available for sale:
Proceeds from principal repayments and maturities 15,076,499 8,751,548
Purchases (19,541,205) (15,372,142)
Decrease in loans receivable, net 746,406 7,303,725
Proceeds from sales of real estate acquired through
foreclosure 260,235 953,097
Redemption (purchase) of Federal Home Loan Bank stock (92,900) 58,700
Purchase of premises and equipment (162,208) (46,393)
------------ -------------
Net cash provided by (used for) investing activities (3,713,173) 1,648,535
------------ -------------
FINANCING ACTIVITIES
Increase in deposits, net 2,257,724 1,098,726
Repayment of Federal Home Loan Bank borrowings (57,138) (1,151,020)
Decrease in advances by borrowers
for taxes and insurance, net (88,564) (152,038)
------------ -------------
Net cash provided by (used for) financing activities 2,112,022 (204,332)
------------ -------------
Increase (decrease) in cash and cash equivalents (996,816) 1,976,539
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR 7,300,707 5,324,168
------------ -------------
CASH AND CASH EQUIVALENTS AT END OF YEAR $ 6,303,891 $ 7,300,707
============ =============
SUPPLEMENTAL CASH FLOW DISCLOSURES
Cash paid:
Interest $ 2,474,104 $ 3,042,855
Income taxes 317,717 405,160
Noncash transactions:
Transfers from loans to real estate acquired through foreclosure 312,813 660,169
See accompanying notes to the consolidated financial statements.
7
Exhibit 6 Page 1 of 5
Selected Financial Data
Corporate Key Financial Data for the Most Recent Quarter
------------------------------------------- ------------------------------------------------------
Securi- Borrow-
Number Conver- Total Loans/ Loans/ ties Deposits/ ings/ /IEA/
of IPO sion Assets Deposits Assets Assets Assets Assets IBL
Ticker Short Name Exchange City State Offices Date Type ($000) (%) (%) (%) (%) (%) (%)
- ---------------------------------------------------------------------------- ------------------------------------------------------
Comparable Thrift Data
ALFC Atlantic
Liberty
Financial
Corp NASDAQ Brooklyn NY 2 10/23/2002 Standard 159,080 97.74 67.19 25.19 68.74 13.33 118.61
AMFC AMB Financial
Corp. NASDAQ Munster IN 3 04/01/1996 Standard 148,499 106.27 79.71 6.83 75.00 14.11 102.30
CIBI Community
Investors
Bancorp,
Inc. NASDAQ Bucyrus OH 3 02/07/1995 Standard 121,375 110.13 78.62 10.51 71.40 17.41 109.88
CKFB CKF Bancorp,
Inc. NASDAQ Danville KY 3 01/04/1995 Standard 144,984 103.36 86.75 8.27 83.93 4.76 108.40
ESBK Elmira
Savings
Bank, FSB NASDAQ Elmira NY 6 03/01/1985 Standard 291,292 80.82 64.99 30.07 80.41 11.00 115.55
FFDF FFD Financial
Corporation NASDAQ Dover OH 3 04/03/1996 Standard 136,469 112.09 84.88 3.55 75.73 11.28 113.10
FKKY Frankfort
First
Bancorp,
Inc. NASDAQ Frankfort KY 3 07/10/1995 Standard 138,611 164.50 90.31 4.63 54.90 30.77 114.98
FNFI First Niles
Financial,
Inc. NASDAQ Niles OH 1 10/27/1998 Standard 98,956 63.53 39.46 53.88 62.12 20.72 121.33
HWEN Home
Financial
Bancorp NASDAQ Spencer IN 2 07/02/1996 Standard 61,828 124.13 77.50 5.77 62.44 25.88 104.88
NBSI North
Bancshares,
Inc. NASDAQ Chicago IL 2 12/21/1993 Standard 129,981 104.24 69.20 22.36 66.38 21.16 115.93
PBNC PFS Bancorp,
Inc. NASDAQ Aurora IN 3 10/12/2001 Standard 117,625 108.49 82.86 10.86 76.38 - 129.13
PSFC Peoples-
Sidney
Financial
Corporation NASDAQ Sidney OH 4 04/28/1997 Standard 140,667 128.88 83.62 6.38 64.88 22.51 112.54
SZB SouthFirst
Bancshares,
Inc. AMEX Sylacauga AL 3 02/14/1995 Standard 133,654 91.47 64.03 25.23 70.00 20.20 100.98
UTBI United
Tennessee
Bankshares
Inc. NASDAQ Newport TN 3 01/05/1998 Standard 117,681 80.01 67.41 26.24 84.25 - 115.63
- ---------------------------------------------------------------------------- -------------------------------------------------------
Average 138,622 105.40 74.04 17.13 71.18 15.22 113.09
Median 135,062 105.26 78.06 10.69 70.70 15.76 114.04
Maximum 291,292 164.50 90.31 53.88 84.25 30.77 129.13
Minimum 61,828 63.53 39.46 3.55 54.90 - 100.98
TBD SE
Financial
Corp. OTC Philadelp PA 2 TBD Standard 87,367 73.84 58.07 31.29 82.72 7.60 110.36
Variance to the Comparable Median (47,695) (31.41)(19.99) 20.60 12.02 (8.16) (3.68)
Exhibit 6 Page 2 of 5
Selected Financial Data
Asset Quality for the Profitability
Capital for the Most Recent Quarter Most Recent Quarter for the LTM
------------------------------------------------ ---------------------------------------------- --------------
Core
Tangible Intangible Capital Equity + Reser- Reser- Reser- Return Return
Equity/ Equity/ Assets/ Tangible Reserves/ NPLs/ ves/ NPAs/ NPAs/ ves/ ves/ on Ave on Ave
Assets Tang Assets Equity Assets Assets Loans NPLs Assets Equity Loans NPAs +90 Assets Equity
Ticker Short Name (%) (%) (%) (%) (%) (%) (%) (%) (%) (%) (%) (%) (%)
- ------------------------------- --------------------------------------------- --------------------------------------------------
Comparable Thrift Data
ALFC Atlantic
Liberty
Financial
Corp. 16.26 16.26 - 11.39 16.63 0.27 198.63 0.23 1.43 0.54 156.87 0.88 5.21
AMFC AMB Financial
Corp. 8.21 8.21 - 8.40 8.88 1.09 77.52 0.97 11.79 0.84 69.59 0.78 9.66
CIBI Community
Investors
Bancorp, Inc. 10.67 10.67 - 10.44 11.13 0.97 59.40 0.76 7.15 0.58 59.40 0.87 8.27
CKFB CKF Bancorp, Inc. 10.39 9.71 7.30 NA 10.82 NA NA NA NA 0.49 NA 1.03 10.21
ESBK Elmira Savings
Bank, FSB 7.45 7.26 2.72 7.34 8.25 1.09 113.53 0.75 10.01 1.23 106.77 0.86 11.46
FFDF FFD Financial
Corporation 12.44 12.44 - 11.66 13.03 1.04 67.67 0.88 7.07 0.70 67.67 0.73 5.87
FKKY Frankfort
First Bancorp,
Inc. 12.90 12.90 - 11.25 12.96 - NM - - 0.07 9.70 0.86 6.58
FNFI First Niles
Financial, Inc. 16.22 16.22 - 14.60 16.99 1.94 100.79 0.76 4.71 1.95 72.64 1.06 6.00
HWEN Home Financial
Bancorp 11.02 11.02 - 9.10 11.57 1.35 52.55 2.27 20.61 0.71 24.22 0.54 5.12
NBSI North
Bancshares, Inc. 10.47 10.47 - 10.07 10.72 - NM - - 0.36 NM 0.31 3.03
PBNC PFS Bancorp, Inc. 22.61 22.61 - 17.95 23.24 1.13 68.00 1.08 4.77 0.77 58.94 0.69 3.05
PSFC Peoples-Sidney
Financial
Corporation 12.39 12.39 - 11.30 12.93 1.01 63.34 0.92 7.42 0.64 36.51 0.62 5.03
SZB SouthFirst
Bancshares, Inc. 8.74 8.36 4.66 9.99 9.63 2.51 55.42 1.66 18.99 1.39 53.72 0.08 0.91
UTBI United Tennessee
Bankshares, Inc. 13.92 13.32 4.96 11.32 14.68 - NM 0.04 0.29 1.12 218.38 1.52 10.72
- ------------------------------------------------------------------------------------------------------------------------------------
Average 12.41 12.27 1.40 11.14 12.96 0.95 85.69 0.79 7.25 0.81 77.87 0.77 6.51
Median 11.71 11.71 - 11.25 12.25 1.04 67.84 0.76 7.07 0.71 63.54 0.82 5.94
Maximum 22.61 22.61 7.30 17.95 23.24 2.51 198.63 2.27 20.61 1.95 218.38 1.52 11.46
Minimum 7.45 7.26 - 7.34 8.25 - 52.55 - - 0.07 9.70 0.08 0.91
TBD SE Financial Corp. 8.78 8.78 - 8.86 9.08 0.75 68.85 0.48 5.49 0.51 62.47 0.64 7.23
Variance to the
Comparable
Median (2.93) (2.93) - (2.39) (3.17) (0.29) 1.01 (0.28) (1.58) (0.20) (1.06) (0.18) 1.30
Exhibit 6 Page 3 of 5
Selected Financial Data
Income Statement for the LTM Balance Sheet Growth
---------------------------------------------------------------- -----------------------
Non- Non-
Yield interest interest
on Ave Net Net Income/ Expense/ Effic- Over- Asset Loan Deposit
Earn Cost of Interest Interest Avg Ave iency head Growth Growth Growth
Assets Funds Spread Margin Assets Assets Ratio Ratio Rate Rate Rate
Ticker Short Name (%) (%) (%) (%) (%) (%) (%) (%) (%) (%) (%)
- ------------------------------------------------------------------------------------------------------------------------------------
Comparable Thrift Data
ALFC Atlantic Liberty Financial Corp 6.02 1.85 4.17 4.46 0.27 2.91 64.32 62.02 (4.63) 10.19 (28.71)
AMFC AMB Financial Corp. 6.29 3.04 3.25 3.31 1.05 2.81 68.70 57.91 1.32 2.28 5.51
CIBI Community Investors Bancorp, Inc. 5.81 2.94 2.87 3.13 0.43 2.13 60.91 55.48 0.04 (1.85) (0.15)
CKFB CKF Bancorp, Inc. 5.88 3.01 2.87 3.10 0.14 1.55 49.33 46.98 1.85 5.09 1.19
ESBK Elmira Savings Bank, FSB 5.99 2.67 3.32 3.68 0.76 2.81 65.57 57.99 2.61 (10.90) 1.64
FFDF FFD Financial Corporation 4.98 2.39 2.59 2.87 0.74 2.37 66.45 57.72 0.60 9.35 2.50
FKKY Frankfort First Bancorp, Inc. 6.06 4.08 1.98 2.52 0.05 1.23 48.72 47.78 (0.62) (2.97) 1.31
FNFI First Niles Financial, Inc. 5.46 2.74 2.72 3.20 0.05 1.85 58.08 57.41 1.05 (4.45) 3.85
HWEN Home Financial Bancorp 8.31 3.33 4.98 5.13 0.54 3.97 72.98 69.98 (9.57) (8.20) (12.39)
NBSI North Bancshares, Inc. 5.46 3.35 2.11 2.57 0.34 2.38 84.01 81.82 (6.87) (3.18) (3.61)
PBNC PFS Bancorp, Inc. 5.08 2.36 2.72 3.25 0.33 2.30 64.35 60.72 (3.06) 2.81 (3.35)
PSFC Peoples-Sidney Financial
Corporation 6.19 3.41 2.78 3.16 0.10 2.18 68.12 67.12 5.46 (2.27) (1.62)
SZB SouthFirst Bancshares, Inc. 6.09 2.93 3.16 3.19 2.57 5.01 92.38 85.38 (5.62) (8.81) (3.03)
UTBI United Tennessee
Bankshares, Inc. 6.38 1.89 4.49 4.75 0.38 2.46 47.51 43.21 7.82 (0.53) 8.10
- ------------------------------------------------------------------------------------------------------------------------------------
Average 6.00 2.86 3.14 3.45 0.55 2.57 65.10 60.82 (0.69) (0.96) (2.05)
Median 6.01 2.94 2.87 3.20 0.36 2.38 64.96 57.95 0.32 (2.06) 0.52
Maximum 8.31 4.08 4.98 5.13 2.57 5.01 92.38 85.38 7.82 10.19 8.10
Minimum 4.98 1.85 1.98 2.52 0.05 1.23 47.51 43.21 (9.57) (10.90) (28.71)
TBD SE Financial Corp. 6.21 3.25 2.95 3.26 0.45 2.52 71.24 67.08 2.47 (1.86) 3.23
Variance to the Comparable Median 0.21 0.32 0.08 0.06 0.09 0.14 6.28 9.13 2.15 0.20 2.71
Exhibit 6 Page 3 of 5
Selected Financial Data Continued
Market Data
----------------------------------------------------------
Publicly Tangible
Market Price Price Price Reported Publicly Rep
Value Per Share High Low Book Value Book Value
Ticker Short Name ($) ($) ($) ($) ($) ($)
- -----------------------------------------------------------------------------------------------------------------
Comparable Thrift Data
ALFC Atlantic Liberty Financial Corp 32.47 18.98 20.28 18.01 15.12 15.12
AMFC AMB Financial Corp. 13.84 14.58 16.50 13.12 12.83 12.83
CIBI Community Investors Bancorp, Inc. 17.79 16.42 16.42 13.13 12.06 12.06
CKFB CKF Bancorp, Inc. 23.69 16.10 18.04 13.13 10.24 9.49
ESBK Elmira Savings Bank, FSB 32.20 31.01 31.50 28.70 20.89 20.32
FFDF FFD Financial Corporation 18.41 15.15 15.15 14.59 13.99 13.99
FKKY Frankfort First Bancorp, Inc. 28.02 22.21 22.37 19.79 14.23 14.23
FNFI First Niles Financial, Inc. 24.65 17.75 17.90 16.43 11.56 11.56
HWEN Home Financial Bancorp 8.42 6.21 6.40 5.46 5.02 5.02
NBSI North Bancshares, Inc. 16.60 14.50 15.00 12.75 11.81 11.81
PBNC PFS Bancorp, Inc. 29.61 20.09 20.80 17.89 18.04 18.04
PSFC Peoples-Sidney Financial Corporation 23.32 16.20 16.20 13.25 12.11 12.11
SZB SouthFirst Bancshares, Inc. 12.12 16.75 17.75 15.85 16.13 15.38
UTBI United Tennessee Bankshares, Inc. 24.22 19.50 19.50 15.09 13.19 12.54
- ---------------------------------------------- ----------------------------------------------------------------
Average 21.81 17.53 18.13 15.51 13.37 13.18
Median 23.51 16.59 17.83 14.84 13.01 12.69
Maximum 32.47 31.01 31.50 28.70 20.89 20.32
Minimum 8.42 6.21 6.40 5.46 5.02 5.02
TBD SE Financial Corp. 17.50 NA NA NA NA NA
Variance to the Comparable Median (6.01) NA NA NA NA NA
Exhibit 6 Page 4 of 5
Selected Financial Data
Dividends Current Prcing Date as of 1/24/04
--------------------- -----------------------------------------------------------------
Price Price
Publicly Tamg
Current LTM Dividend Price/ Price/ Rep Publicly
Dividend Payout Price/ Core Price/ LTM Book Rep Price/
Yield Ratio Earnings Earnings LTM EPS Core EPS Value Book Value Assets
Ticker Short Name ($) (%) (x) (x) (x) (x) (%) (%) (%)
- ------------------------------------------------------------------ -----------------------------------------------------------------
Comparable Thrift Data
ALFC Atlantic Liberty Financial Corp 1.05 NA 21.57 21.57 NA NA 125.53 125.53 20.41
AMFC AMB Financial Corp. 1.37 17.02 13.02 11.76 12.79 11.76 113.64 113.64 9.32
CIBI Community Investors Bancorp, Inc. 2.07 33.85 18.66 18.66 17.10 17.10 136.15 136.15 14.53
CKFB CKF Bancorp, Inc. 2.98 40.74 13.88 NA 14.91 NA 157.23 169.65 16.34
ESBK Elmira Savings Bank, FSB 2.45 30.00 13.60 13.60 13.31 14.49 148.44 152.61 11.05
FFDF FFD Financial Corporation 2.77 48.78 25.25 25.25 18.48 18.48 108.29 108.29 13.47
FKKY Frankfort First Bancorp, Inc. 5.04 121.74 32.66 29.22 NA 24.14 156.08 156.08 20.13
FNFI First Niles Financial, Inc. 3.38 71.79 22.19 26.10 22.76 25.72 153.55 153.55 24.91
HWEN Home Financial Bancorp 1.93 46.15 19.41 19.41 23.88 17.74 123.71 123.71 13.62
NBSI North Bancshares, Inc. 2.21 110.81 30.21 45.31 45.31 43.94 122.78 122.78 12.85
PBNC PFS Bancorp, Inc. 1.49 46.61 33.48 33.48 34.05 33.48 111.36 111.36 25.17
PSFC Peoples-Sidney Financial Corporation 3.46 81.54 23.82 22.50 24.18 24.92 133.77 133.77 16.58
SZB SouthFirst Bancshares, Inc. 3.58 400.00 NM NM 111.67 NM 103.84 108.91 9.07
UTBI United Tennessee Bankshares, Inc. 1.69 25.00 14.34 14.34 14.77 14.89 147.84 155.50 20.58
- ------------------------------------------------------------------------------------------------------------------------------------
Average 2.53 82.62 21.70 23.43 29.43 22.42 131.59 133.68 16.29
Median 2.33 46.61 21.57 22.04 20.62 18.48 129.65 129.65 15.44
Maximum 5.04 400.00 33.48 45.31 111.67 43.94 157.23 169.65 25.17
Minimum 1.05 17.02 13.02 11.76 12.79 11.76 103.84 108.29 9.07
TBD SE Financial Corp. NA NA NA NA NA NA NA NA NA
Variance to the Comparable Median NA NA NA NA NM NM NA NA NA
Exhibit 6 Page 4 of 5
Selected Financial Data Continued
Productivity
-----------
Full Time
Equivalent
Employees
Ticker Short Name LTM
- --------------------------------------------------------------------
Comparable Thrift Data
ALFC Atlantic Liberty Financial Corp 24
AMFC AMB Financial Corp. 30
CIBI Community Investors Bancorp, Inc. 35
CKFB CKF Bancorp, Inc. NA
ESBK Elmira Savings Bank, FSB 108
FFDF FFD Financial Corporation 41
FKKY Frankfort First Bancorp, Inc. 26
FNFI First Niles Financial, Inc. 12
HWEN Home Financial Bancorp 25
NBSI North Bancshares, Inc. 33
PBNC PFS Bancorp, Inc. 35
PSFC Peoples-Sidney Financial Corporation 31
SZB SouthFirst Bancshares, Inc. 82
UTBI United Tennessee Bankshares, Inc. 28
- ---------------------------------------------- -------------------
Average 39
Median 31
Maximum 108
Minimum 12
TBD SE Financial Corp. 23
Variance to the Comparable Median (8)
Exhibit 6 Page 5 of 5
Selected Financial Data
Income
---------------------------------------------------------
Net Core Core Net Core Core
Income Income EPS EPS Income Income EPS EPS
Ticker Short Name MRQ MRQ MRQ MRQ LTM LTM LTM LTM
- -----------------------------------------------------------------------------------------------------------
Comparable Thrift Data
ALFC Atlantic Liberty Financial Corp 356 356 0.22 0.22 1,254 1,254 NA NA
AMFC AMB Financial Corp. 285 314 0.28 0.31 1,146 1,242 1.14 1.24
CIBI Community Investors Bancorp, Inc. 237 237 0.22 0.22 1,059 1,059 0.96 0.96
CKFB CKF Bancorp, Inc. 404 NA 0.29 NA 1,480 NA 1.08 NA
ESBK Elmira Savings Bank, FSB 601 601 0.57 0.57 2,443 2,239 2.33 2.14
FFDF FFD Financial Corporation 176 176 0.15 0.15 988 988 0.82 0.82
FKKY Frankfort First Bancorp, Inc. 251 251 0.19 0.19 1,192 1,192 0.92 0.92
FNFI First Niles Financial, Inc. 261 225 0.20 0.17 1,056 935 0.78 0.69
HWEN Home Financial Bancorp 100 99 0.08 0.08 341 456 0.26 0.35
NBSI North Bancshares, Inc. 93 95 0.08 0.08 417 380 0.37 0.33
PBNC PFS Bancorp, Inc. 204 204 0.15 0.15 819 837 0.59 0.60
PSFC Peoples-Sidney Financial Corporation 249 249 0.18 0.18 872 872 0.65 0.65
SZB SouthFirst Bancshares, Inc. -87 -88 (0.12) (0.12) 116 -39 0.15 (0.05)
UTBI United Tennessee Bankshares, Inc. 437 437 0.34 0.34 1,716 1,708 1.32 1.31
- ---------------------------------------------- -----------------------------------------------------------
Average 255 243 0.20 0.20 1,064 1,009 0.87 0.83
Median 250 237 0.20 0.18 1,058 988 0.82 0.76
Maximum 601 601 0.57 0.57 2,443 2,239 2.33 2.14
Minimum -87 -88 (0.12 )(0.12) 116 -39 0.15 (0.05)
TBD SE Financial Corp. NA NA NA NA 556 556 NA NA
Variance to the Comparable Median NM NM NM NM (502) (432) NM NM
Exhibit 7
Industry Multiples
Pricing Data as of January 20, 2004
--------------------------------------------------------
Current Price in Relation to
-------------------------------------------------------- LTM
Current Current Tangible Current Dividend
Stock Market LTM LTM Book Book Dividend Payout
Price Value Earnings Core EPS EPS Core EPS Value Value Assets Yield Ratio
Ticker Short Name ($) ($M) (x) (x) (x) (x) (%) (%) (%) (%) (%)
- ------------------------------------------------------------------------------------------------------------------------------------
AABC Access Anytime Bancorp, Inc. 13.31 17.99 11.88 11.88 12.10 12.10 118.84 132.97 8.91 0.00 0.00
ABBK Abington Bancorp, Inc. 40.52 158.96 112.56 168.83 47.12 53.32 278.68 337.67 19.24 1.09 51.16
ABCW Anchor BanCorp Wisconsin Inc. 25.81 597.26 13.44 13.44 11.89 12.12 203.87 220.03 16.31 1.70 18.43
AF Astoria Financial Corporation 35.90 2,850.34 16.93 18.32 13.86 14.71 188.55 216.66 12.96 2.45 32.43
AFBC Advance Financial Bancorp 18.00 25.17 9.38 9.38 12.00 12.00 122.53 177.51 7.70 2.22 24.00
ALFC Atlantic Liberty Financial Corp 18.98 32.47 21.57 21.57 NA NA 125.53 125.53 20.41 1.05 NA
AMFC AMB Financial Corp. 14.58 13.84 13.02 11.76 12.79 11.76 113.64 113.64 9.32 1.37 17.02
ANE Alliance Bancorp of New England,
Inc. 40.15 108.26 NM 45.63 45.63 32.64 360.09 360.74 25.38 0.75 34.09
ASBI Ameriana Bancorp 16.19 50.97 13.49 NM NM NM 130.67 133.14 12.67 3.95 NM
ASBP ASB Financial Corp. 25.00 41.39 21.55 23.15 19.69 21.01 253.04 253.04 27.06 2.24 121.26
BBX BankAtlantic Bancorp, Inc. 15.52 839.78 12.93 12.93 14.11 13.38 177.98 215.26 17.60 0.85 11.45
BFD BostonFed Bancorp, Inc. 35.31 158.12 28.48 28.48 63.05 63.05 169.52 191.80 9.64 1.81 114.29
BHL Berkshire Hills Bancorp, Inc. 37.90 222.81 22.03 24.29 114.85 NM 185.24 202.57 19.08 1.27 145.45
BKUNA BankUnited Financial Corporation 26.00 762.08 18.57 18.57 19.12 20.63 174.73 186.65 10.80 0.00 0.00
BRBI Blue River Bancshares, Inc. 6.35 15.28 79.38 NM NM NM 127.51 127.51 13.84 0.00 NM
BYFC Broadway Financial Corporation 13.91 25.47 18.30 18.30 19.05 19.05 155.77 155.77 11.49 1.08 23.97
CAFI Camco Financial Corporation 17.38 128.27 20.69 27.16 15.11 16.09 136.74 141.19 12.27 3.34 48.70
CASH First Midwest Financial, Inc. 21.99 54.84 18.33 18.33 16.17 17.45 127.48 138.40 7.10 2.36 38.24
CBSA Coastal Bancorp, Inc. 41.21 215.75 17.17 NA 18.56 NA 166.30 198.03 8.04 1.46 24.32
CCBI Commercial Capital Bancorp Inc. 26.85 602.40 29.18 30.51 NA NA 625.87 723.72 41.48 0.00 NA
CEBK Central Bancorp, Inc. 36.00 59.94 16.98 18.00 21.56 21.69 140.73 148.51 12.52 1.33 28.74
CFB Commercial Federal Corporation 27.90 1,176.36 13.68 7.19 13.22 18.00 155.35 203.80 9.46 1.79 18.01
CFCP Coastal Financial Corporation 17.34 224.74 20.64 19.70 20.89 21.41 304.21 304.21 18.97 1.27 24.16
CFF Centrue Financial Corporation 27.97 72.65 15.89 14.88 35.86 42.38 166.09 190.01 10.24 1.07 38.46
CFFC Community Financial Corporation 20.00 41.50 12.82 12.82 13.16 13.79 150.94 151.17 13.44 2.00 24.34
CFSB Citizens First Financial Corp. 25.92 38.74 20.90 20.90 19.79 19.79 116.86 116.86 11.02 1.54 30.53
CFSL Chesterfield Financial Corp. 25.31 98.19 42.18 42.18 35.65 35.65 133.35 134.20 26.63 1.26 35.21
CIBI Community Investors Bancorp, Inc. 16.42 17.79 18.66 18.66 17.10 17.10 136.15 136.15 14.53 2.07 33.85
CITZ CFS Bancorp, Inc. 14.99 182.44 46.84 62.46 42.83 55.52 118.31 118.31 12.32 2.94 122.86
CKFB CKF Bancorp, Inc. 16.10 23.69 13.88 NA 14.91 NA 157.23 169.65 16.34 2.98 40.74
CNY Carver Bancorp, Inc. 25.98 59.35 11.81 12.03 14.68 14.76 148.80 149.05 11.37 0.77 8.47
CTZN Citizens First Bancorp, Inc. 22.89 195.00 15.06 NA 14.13 NA 125.98 125.98 18.32 1.57 20.37
DCOM Dime Community Bancshares, Inc. 30.63 784.28 12.55 12.55 14.12 13.99 274.46 343.39 25.14 2.22 26.27
DFBS DutchFork Bancshares, Inc. 38.10 42.97 10.82 158.75 12.17 38.10 131.97 131.97 18.28 0.00 0.00
DSL Downey Financial Corp. 49.21 1,374.37 14.47 NA 13.52 NA 149.89 150.40 11.80 0.73 9.89
EFC EFC Bancorp, Inc. 25.48 116.77 15.54 17.22 16.23 17.57 152.39 152.39 13.23 2.32 35.99
ESBF ESB Financial Corporation 15.75 169.92 19.69 23.16 20.19 23.51 174.61 189.53 12.51 2.54 47.00
ESBK Elmira Savings Bank, FSB 31.01 32.20 13.60 13.60 13.31 14.49 148.44 152.61 11.05 2.45 30.00
EVRT EverTrust Financial Group, Inc. 19.11 137.10 22.75 28.10 21.23 21.47 147.34 147.34 18.88 2.30 38.26
FAB FIRSTFED AMERICA BANCORP, INC. 26.70 459.93 19.63 20.86 18.16 21.36 228.99 311.55 18.31 1.95 26.87
FBC Flagstar Bancorp, Inc. 23.20 1,402.52 10.18 NA 5.81 NA 215.01 215.01 13.32 2.59 11.28
FBEI First Bancorp of Indiana, Inc. 20.27 32.61 23.03 NA 22.27 NA NA NA NA 2.66 NA
FBNW FirstBank NW Corp. 30.50 86.26 14.95 14.95 13.74 13.74 126.03 126.03 12.36 1.97 27.03
FBSI First Bancshares, Inc. 20.66 34.09 13.96 13.96 15.08 15.19 126.28 128.80 12.55 0.77 11.68
FBTC First BancTrust Corporation 24.00 30.25 13.33 15.79 14.46 15.09 117.53 117.53 13.47 1.67 18.07
FBTX Franklin Bank Corp. 18.50 333.80 NA NA NA NM NA NA NA 0.00 NM
FCB Falmouth Bancorp, Inc. 36.50 33.39 39.67 39.67 57.03 28.97 187.85 187.85 20.08 1.42 81.25
FCFL First Community Bank Corporation
of America 15.50 30.89 21.53 21.53 NA NA 156.09 159.63 17.81 0.00 NA
FDT Federal Trust Corporation 7.80 51.41 17.73 17.73 19.50 21.67 196.47 196.47 11.70 1.03 7.50
FED FirstFed Financial Corp. 41.25 701.78 9.92 9.92 11.24 11.24 166.94 170.10 15.54 0.00 0.00
FESX First Essex Bancorp, Inc. 58.96 493.61 43.35 22.68 26.68 22.76 301.74 332.92 26.33 1.63 38.25
Page 1 of 7
--------------------------------------------------------
Current Price in Relation to
-------------------------------------------------------- LTM
Current Current Tangible Current Dividend
Stock Market LTM LTM Book Book Dividend Payout
Price Value Earnings Core EPS EPS Core EPS Value Value Assets Yield Ratio
Ticker Short Name ($) ($M) (x) (x) (x) (x) (%) (%) (%) (%) (%)
- ------------------------------------------------------------------------------------------------------------------------------------
FFBH First Federal Bancshares of
Arkansas Inc. 20.06 106.88 14.33 14.33 13.84 13.84 145.26 145.26 15.36 1.79 22.07
FFBI First Federal Bancshares, Inc. 33.31 61.63 17.35 32.03 22.97 32.98 151.68 158.77 19.71 1.32 26.21
FFBZ First Federal Bancorp, Inc. 9.00 29.35 15.00 15.00 16.67 15.00 136.57 136.57 12.51 2.67 40.74
FFCH First Financial Holdings, Inc. 29.45 370.33 17.96 NA 14.87 NA 224.98 NA 15.21 2.99 39.90
FFDF FFD Financial Corporation 15.15 18.41 25.25 25.25 18.48 18.48 108.29 108.29 13.47 2.77 48.78
FFED Fidelity Federal Bancorp 1.73 16.64 NM NA NM NA 124.46 124.46 10.61 0.00 NA
FFHH FSF Financial Corp. 30.20 71.92 15.73 16.06 13.07 11.84 135.43 149.73 13.09 3.97 47.06
FFHS First Franklin Corporation 18.61 30.53 20.23 23.26 16.32 21.15 128.26 128.26 11.11 1.72 26.75
FFIC Flushing Financial Corporation 18.50 353.84 14.92 14.92 15.68 15.68 252.04 259.10 19.13 1.58 22.60
FFLC FFLC Bancorp, Inc. 29.85 161.11 19.13 NA 17.87 NA 208.30 208.30 17.00 1.74 27.54
FFWC FFW Corporation 22.15 28.62 12.31 12.31 12.59 12.66 125.50 131.14 11.96 2.89 34.66
FKAN First Kansas Financial Corporation18.70 16.98 NM NM NM NM 104.76 104.76 11.14 1.07 NM
FKFS First Keystone Financial, Inc. 27.30 51.51 23.53 37.92 20.22 23.53 162.31 162.31 9.41 1.61 29.63
FKKY Frankfort First Bancorp, Inc. 22.21 28.02 32.66 29.22 NA 24.14 156.08 156.08 20.13 5.04 121.74
FMCO FMS Financial Corporation 18.50 119.99 33.04 35.58 21.26 21.76 197.44 201.31 10.04 0.65 13.79
FMSB First Mutual Bancshares, Inc. 24.22 114.28 13.16 13.76 14.42 15.43 233.56 233.56 13.64 1.16 15.90
FNFI First Niles Financial, Inc. 17.75 24.65 22.19 26.10 22.76 25.72 153.55 153.55 24.91 3.38 71.79
FPFC First Place Financial Corp. 19.49 259.00 14.33 NA 13.73 NA 138.23 157.43 15.50 2.87 37.32
FPTB First PacTrust Bancorp, Inc. 22.10 115.88 27.63 27.63 29.47 28.70 122.23 122.23 18.89 1.45 24.00
FSBI Fidelity Bancorp, Inc. 26.78 65.21 14.55 15.57 17.85 19.84 161.52 174.12 10.51 1.79 30.55
FSFF First SecurityFed Financial, Inc. 34.81 137.60 14.50 14.50 15.61 15.61 154.99 155.12 28.03 1.95 26.46
FTFC First Federal Capital Corp 23.48 525.64 11.51 11.51 12.69 12.69 205.78 254.66 15.54 2.39 29.19
GAF GA Financial, Inc. 34.78 174.77 24.15 28.98 24.15 27.82 182.67 182.76 19.57 2.30 54.17
GAFC Greater Atlantic Financial Corp. 8.20 24.70 7.88 7.88 13.67 13.90 107.61 114.05 4.95 0.00 0.00
GCFC Central Federal Corporation 14.25 28.64 NM NM NM NM 136.36 136.36 26.73 2.53 NM
GDW Golden West Financial Corporation 98.65 4,987.61 13.48 14.34 14.38 15.13 265.90 265.90 19.68 0.41 4.96
GPT GreenPoint Financial Corp. 37.19 4,959.32 11.34 11.48 9.71 9.89 245.15 312.00 21.86 2.58 21.50
GSLA GS Financial Corp. 19.54 25.50 37.58 NM 39.88 NM 86.96 86.96 12.19 2.05 79.59
GTPS Great American Bancorp, Inc. 35.50 26.84 18.88 NA 17.57 NA 152.16 156.46 16.83 1.24 21.78
GUPB GFSB Bancorp, Inc. 22.90 26.25 20.45 20.45 17.62 17.62 147.36 147.36 10.86 2.18 41.54
HARL Harleysville Savings Financial
Corporation 30.50 69.14 15.25 17.73 15.40 15.89 169.35 169.35 10.58 2.62 33.33
HCBB HCB Bancshares, Inc. 18.18 26.37 56.81 56.81 60.60 39.52 97.32 97.32 10.87 1.98 120.00
HCBC High Country Bancorp, Inc. 32.35 28.94 17.21 17.21 15.19 15.19 159.60 159.60 15.07 1.55 35.21
HCFC Home City Financial Corporation 16.97 13.31 21.21 21.21 20.44 20.95 113.89 117.11 8.87 2.59 53.01
HFBC HopFed Bancorp, Inc. 17.50 63.53 15.09 16.83 18.23 21.08 134.82 153.78 12.18 2.74 47.92
HFFB Harrodsburg First Financial
Bancorp, Inc. 23.42 28.64 16.73 16.73 22.30 23.90 137.93 142.11 16.50 2.56 57.14
HFFC HF Financial Corp. 16.82 60.32 11.68 11.68 12.94 12.94 119.46 132.44 7.69 2.54 32.33
HIFS Hingham Institution for Savings 43.55 90.46 14.91 14.91 16.19 18.07 224.60 224.60 19.02 1.65 32.71
HLFC Home Loan Financial Corporation 18.94 31.70 15.27 15.27 15.15 15.27 144.25 144.25 20.90 3.91 60.00
HMLK Hemlock Federal Financial Corp. 28.82 28.05 18.01 30.02 16.01 22.17 119.33 127.01 8.75 2.36 35.00
HMNF HMN Financial, Inc. 24.27 109.11 7.98 8.79 12.71 14.28 136.89 144.64 13.48 3.30 38.74
HRBT Hudson River Bancorp, Inc. 20.90 633.51 19.35 NA 19.53 NA 213.70 287.88 24.56 1.53 26.17
HRZB Horizon Financial Corp. 19.20 201.12 15.48 15.48 15.87 15.87 186.41 187.32 24.61 2.60 38.84
HTHR Hawthorne Financial Corporation 29.50 340.87 12.94 NA 13.85 NA 192.68 222.81 13.29 0.00 0.00
HWEN Home Financial Bancorp 6.21 8.42 19.41 19.41 23.88 17.74 123.71 123.71 13.62 1.93 46.15
HWFG Harrington West Financial Group,
Inc. 16.75 72.67 9.52 9.10 NA NA 156.98 176.69 8.07 2.39 NA
ICBC Independence Community Bank Corp. 35.20 1,917.55 12.75 NA 13.54 NA 193.51 238.00 20.09 2.27 26.15
IFSB Independence Federal Savings Bank 24.25 37.65 NM NM NM NM 172.60 172.60 17.31 0.00 NM
KNBT KNBT Bancorp, Inc. 17.55 532.87 NA NA NA NA NA NA NA 0.00 NA
LARL Laurel Capital Group, Inc. 25.50 47.86 26.56 26.56 21.79 21.79 174.78 204.16 15.65 3.14 65.81
LNCB Lincoln Bancorp 20.07 88.54 25.09 25.09 22.81 21.35 112.87 116.14 15.30 2.59 52.75
Page 2 of 7
--------------------------------------------------------
Current Price in Relation to
-------------------------------------------------------- LTM
Current Current Tangible Current Dividend
Stock Market LTM LTM Book Book Dividend Payout
Price Value Earnings Core EPS EPS Core EPS Value Value Assets Yield Ratio
Ticker Short Name ($) ($M) (x) (x) (x) (x) (%) (%) (%) (%) (%)
- ------------------------------------------------------------------------------------------------------------------------------------
LOGN Logansport Financial Corp. 21.00 18.43 14.58 14.19 11.86 13.73 114.50 114.50 12.14 2.67 31.64
LSBI LSB Financial Corp. 25.40 34.45 9.34 9.34 11.76 11.76 123.78 123.78 10.98 1.97 22.45
LSBX LSB Corporation 16.88 71.47 8.12 NA 17.96 NA 129.95 129.95 15.33 2.84 51.06
MAFB MAF Bancorp, Inc. 44.19 1,458.00 13.98 13.64 13.51 13.11 182.75 240.42 16.77 1.63 21.10
MASB MASSBANK Corp. 42.53 186.77 22.15 23.63 23.50 23.76 169.04 170.73 18.37 2.16 50.28
MCBF Monarch Community Bancorp, Inc. 16.02 38.50 33.38 33.38 NA NA 103.42 103.42 18.46 1.25 NA
MFBC MFB Corp. 33.00 42.94 9.94 9.94 18.33 18.54 124.06 124.06 9.91 1.33 24.17
MFLR Mayflower Co-operative Bank 15.60 31.88 17.73 18.57 16.77 15.76 182.24 183.31 14.92 2.56 43.01
MFSF MutualFirst Financial, Inc. 25.13 132.33 16.11 NA 14.87 NA 137.32 138.61 16.26 1.75 24.26
MSBF MSB Financial, Inc. 18.51 24.19 42.07 18.51 17.63 14.35 156.73 176.96 24.67 2.49 35.27
MTXC Matrix Bancorp, Inc. 9.15 59.46 NM 14.30 NM 22.32 87.06 87.06 3.71 0.00 NM
MYST Mystic Financial, Inc. 32.50 50.14 28.02 30.09 28.51 30.09 177.50 177.50 11.45 1.23 31.32
NASB NASB Financial, Inc. 43.25 365.70 14.81 14.81 15.23 15.34 286.61 294.22 32.98 1.57 23.24
NBN Northeast Bancorp 18.45 46.44 13.18 13.57 12.72 14.64 128.84 132.16 10.10 1.95 22.07
NBSI North Bancshares, Inc. 14.50 16.60 30.21 45.31 45.31 43.94 122.78 122.78 12.85 2.21 110.81
NDE IndyMac Bancorp Inc. 30.53 1,697.79 8.77 9.66 10.56 10.86 176.78 183.25 14.06 2.62 12.11
NEIB Northeast Indiana Bancorp, Inc. 20.10 29.61 17.95 18.61 14.46 14.57 109.19 109.19 13.37 2.79 37.41
NEPF Northeast Pennsylvania Financial
Cororaiton 19.29 80.56 NM NM NM NM 144.06 180.61 8.98 2.49 NM
NHTB New Hampshire Thrift Bancshares, I34.98 69.75 10.05 10.05 12.36 12.77 183.72 270.74 13.45 2.57 24.74
NMIL NewMil Bancorp, Inc. 29.21 119.38 16.23 16.23 17.81 17.81 230.91 277.93 17.51 2.05 35.06
NTBK NetBank, Inc. 13.01 619.08 10.16 10.16 12.05 13.99 145.53 162.83 12.28 0.61 5.56
NYB New York Community Bancorp, Inc. 40.10 7,720.07 18.92 20.05 19.75 21.22 411.70 NM 42.86 2.49 38.30
OCFC OceanFirst Financial Corp. 26.48 354.92 16.15 16.15 16.76 16.97 267.47 270.48 20.25 3.02 48.10
PBCI Pamrapo Bancorp, Inc. 25.15 125.10 16.99 16.99 17.84 17.84 249.75 249.75 19.47 3.18 55.85
PBNC PFS Bancorp, Inc. 20.09 29.61 33.48 33.48 34.05 33.48 111.36 111.36 25.17 1.49 46.61
PCBI Peoples Community Bancorp, Inc. 23.02 58.06 14.76 16.44 15.55 17.57 124.30 140.97 7.86 0.00 0.00
PEDE Great Pee Dee Bancorp, Inc. 17.45 31.03 25.66 22.96 25.66 21.02 117.59 123.15 20.10 3.55 68.29
PFB PFF Bancorp, Inc. 38.75 653.71 14.68 NA 16.42 NA 208.45 209.35 18.89 1.65 19.61
PFDC Peoples Bancorp 24.00 81.55 15.00 15.00 14.46 14.55 128.48 134.68 16.33 2.83 39.16
PFED Park Bancorp, Inc. 29.14 33.66 12.35 13.25 16.10 17.35 106.78 106.78 12.90 2.06 33.15
PFNC Progress Financial Corporation 31.25 230.25 23.67 NA 26.26 NA 333.87 NA 19.69 1.66 27.24
PFS Provident Financial Services, Inc.18.56 1,141.03 33.14 35.69 NA NA 136.87 140.82 27.35 1.08 NA
PFSB PennFed Financial Services, Inc. 34.65 238.32 18.43 18.43 19.25 17.95 196.32 200.87 13.39 1.15 22.22
PPBI Pacific Premier Bancorp, Inc. 12.81 67.32 11.44 11.44 42.70 67.42 243.54 243.54 6.64 0.00 0.00
PROV Provident Financial Holdings, Inc.35.00 166.99 11.82 11.82 10.39 10.57 163.02 163.32 14.37 1.71 7.42
PSFC Peoples-Sidney Financial
Corporation 16.20 23.32 23.82 22.50 24.18 24.92 133.77 133.77 16.58 3.46 81.54
PVFC PVF Capital Corp. 15.75 100.48 18.75 8.75 12.12 10.94 164.23 164.23 14.61 1.88 19.16
PVSA Parkvale Financial Corporation 27.63 153.03 16.06 18.18 15.44 17.06 152.57 172.26 9.53 2.61 40.22
QCBC Quaker City Bancorp, Inc. 45.56 285.50 13.56 13.56 13.21 13.21 203.67 204.21 17.52 1.76 5.80
RIVR River Valley Bancorp 27.39 44.89 15.22 15.22 17.12 17.23 202.13 202.43 18.33 2.48 34.38
RPFG Rainier Pacific Financial Group,
Inc. 16.09 135.85 NA NA NA NA NA NA NA 0.00 NA
SBMC Connecticut Bancshares, Inc. 51.75 569.11 16.38 20.54 18.09 19.90 221.63 248.68 22.13 1.39 24.48
SCFS Seacoast Financial Services
Corporation 29.57 761.09 19.45 19.45 24.64 23.47 198.72 291.04 17.00 1.76 40.00
SFFC StateFed Financial Corporation 13.15 17.22 82.19 82.19 NM NA 122.90 122.90 17.97 3.04 NA
SIB Staten Island Bancorp, Inc. 22.18 1,303.67 32.62 32.62 14.99 14.69 207.87 227.72 17.25 2.52 35.81
SMBC Southern Missouri Bancorp, Inc. 13.82 31.91 11.91 11.91 11.91 11.91 123.84 140.59 11.00 2.60 25.86
SOBI Sobieski Bancorp, Inc. 11.03 7.47 NM NM NM NM 91.84 91.84 6.30 0.00 NM
SOV Sovereign Bancorp, Inc. 23.43 6,956.37 15.41 NA 16.98 NA 210.70 349.70 15.99 0.43 7.25
SSFC South Street Financial Corp. 10.52 32.40 26.30 26.30 19.48 19.48 128.45 128.45 14.78 3.80 74.07
STBI Sturgis Bancorp, Inc. 14.34 40.27 14.34 14.34 14.34 14.34 139.63 170.51 13.95 2.51 33.00
STSA Sterling Financial Corporation 37.66 557.81 16.52 15.96 16.30 17.52 224.17 277.73 13.69 0.00 0.00
Page 3 of 7
--------------------------------------------------------
Current Price in Relation to
-------------------------------------------------------- LTM
Current Current Tangible Current Dividend
Stock Market LTM LTM Book Book Dividend Payout
Price Value Earnings Core EPS EPS Core EPS Value Value Assets Yield Ratio
Ticker Short Name ($) ($M) (x) (x) (x) (x) (%) (%) (%) (%) (%)
- ------------------------------------------------------------------------------------------------------------------------------------
SVBI Severn Bancorp, Inc. 32.30 134.34 12.42 11.06 12.10 12.19 287.37 289.43 25.27 1.11 13.96
SZB SouthFirst Bancshares, Inc. 16.75 12.12 NM NM 111.67 NM 103.84 108.91 9.07 3.58 400.00
THRD TF Financial Corporation 34.22 96.14 NM NM NM NM 177.12 194.10 15.87 1.75 NM
TONE TierOne Corporation 23.48 522.96 19.57 19.57 24.46 24.46 155.19 155.19 25.26 0.00 0.00
TRST TrustCo Bank Corp NY 14.00 1,035.24 21.88 NA 20.00 NA 456.03 457.52 37.19 4.29 85.71
TSBK Timberland Bancorp, Inc. 22.97 97.74 15.95 14.01 13.84 13.28 125.86 125.86 21.72 2.44 30.12
TSH Teche Holding Co. 36.00 81.68 15.79 16.07 14.12 14.17 141.96 141.96 15.07 2.00 22.75
UCBC Union Community Bancorp 17.92 37.63 13.18 13.18 15.06 15.06 106.54 115.76 14.06 3.35 50.42
UCFC United Community Financial Corp. 11.70 399.74 17.21 17.21 16.25 17.21 144.09 166.67 20.30 2.56 41.67
UPFC United PanAm Financial Corp. 15.10 240.15 94.38 94.38 21.88 23.59 245.13 245.13 15.90 0.00 0.00
UTBI United Tennessee Bankshares, Inc. 19.50 24.22 14.34 14.34 14.77 14.89 147.84 155.50 20.58 1.69 25.00
WBS Webster Financial Corporation 47.17 2,151.75 13.25 14.21 13.55 14.97 194.76 272.82 14.71 1.78 22.99
WEFC Wells Financial Corp. 30.80 34.97 7.86 7.86 9.06 9.06 127.38 127.38 15.69 2.60 22.94
WES Westcorp 37.20 1,891.73 14.53 NA 14.70 NA 196.51 196.62 11.86 1.40 20.16
WFI Winton Financial Corporation 13.30 59.61 15.83 15.83 10.81 11.27 136.97 137.25 11.13 3.38 33.33
WFSL Washington Federal, Inc. 27.16 1,936.02 14.76 NA 13.51 NA 180.95 191.67 25.66 3.24 43.28
WM Washington Mutual, Inc. 42.26 6,976.91 11.36 NA 10.04 NA 187.32 278.21 13.44 3.88 33.25
WOFC Western Ohio Financial
Corporation 32.05 56.55 21.09 21.66 22.10 23.57 128.87 128.87 14.90 3.12 68.49
WRO Woronoco Bancorp, Inc. 36.75 132.87 24.83 28.71 21.75 33.41 171.81 176.01 16.70 1.88 35.50
WSB Washington Savings Bank, F.S.B.
(The) 8.85 61.76 8.85 8.85 8.94 9.73 148.74 148.74 15.18 2.26 14.48
WSBI Warwick Community Bancorp, Inc. 34.21 154.48 25.92 25.92 22.07 23.11 206.33 213.28 20.11 1.75 35.48
WSFS WSFS Financial Corporation 44.69 327.18 13.30 NA 5.84 NA 174.03 174.03 14.82 0.45 2.61
WVFC WVS Financial Corp. 18.50 47.58 33.04 33.04 17.62 17.62 156.65 156.65 12.23 3.46 60.95
Page 4 of 7
--------------------------------------------------------
Current Price in Relation to
-------------------------------------------------------- LTM
Current Current Tangible Current Dividend
Stock Market LTM LTM Book Book Dividend Payout
Price Value Earnings Core EPS EPS Core EPS Value Value Assets Yield Ratio
Ticker Short Name ($) ($M) (x) (x) (x) (x) (%) (%) (%) (%) (%)
- ------------------------------------------------------------------------------------------------------------------------------------
All Fully Converted Average 25.19 662.00 20.27 22.63 20.00 19.95 170.83 180.85 15.88 1.88 37.40
All Fully Converted Median 23.43 81.06 16.15 17.21 16.23 17.45 154.27 158.77 14.91 1.94 31.32
All Mutual Holding Companies
ALLB Greater Delaware Valley Savings
Bancorp (MHC) 34.91 120.14 54.55 54.55 87.28 87.28 344.63 344.63 31.89 1.03 90.00
BCSB BCSB Bankcorp, Inc. (MHC) 18.51 108.94 NM NM 84.14 97.42 243.23 258.88 16.30 2.70 227.27
CFFN Capitol Federal Financial (MHC) 38.29 2,809.76 239.31 239.31 53.18 53.18 278.47 278.47 32.71 5.22 294.44
CHEV Cheviot Financial Corp. (MHC) 13.18 57.84 NA NA NA NA NA NA NA 0.00 NA
CHFN Charter Financial Corp. (MHC) 40.27 788.07 100.68 143.82 NM NM 340.12 349.57 78.77 1.99 375.00
GCBC Greene County Bancorp Inc. (MHC) 34.00 69.44 25.76 25.76 30.91 31.19 235.46 235.46 26.76 2.12 63.64
GOV Gouverneur Bancorp Inc. (MHC) 13.15 29.95 46.96 46.96 50.58 54.79 170.56 170.56 33.30 1.98 100.00
HCBK Hudson City Bancorp, Inc. (MHC) 36.34 6,933.46 33.65 37.85 33.04 35.63 489.76 489.76 43.71 1.65 42.73
JXSB Jacksonville Bancorp, Inc. (MHC) 17.39 33.77 72.46 72.46 40.44 69.56 169.82 201.27 12.66 1.73 55.56
NWSB Northwest Bancorp, Inc. (MHC) 20.95 999.80 20.14 23.81 23.81 25.24 209.71 304.95 16.56 1.91 38.64
ONFC Oneida Financial Corp. (MHC) 21.65 106.92 36.08 38.66 30.93 33.31 219.13 292.96 25.95 2.59 78.57
PBCT People's Bank (MHC) 36.65 2,272.30 32.72 NA 35.58 NA 226.79 255.76 19.47 4.26 148.54
PBHC Pathfinder Bancorp, Inc. (MHC) 19.51 47.47 34.84 34.84 38.25 39.82 221.96 285.23 16.51 2.05 54.90
PRTR Partners Trust Financial Group,
Inc. (MHC) 37.38 530.56 40.63 NA 36.65 NA 302.67 384.96 41.29 1.07 33.33
ROME Rome Bancorp, Inc. (MHC) 31.26 133.48 NM 78.15 67.96 54.84 366.90 366.90 49.93 0.94 60.85
SKBO Skibo Financial Corp. (MHC) 16.93 53.39 38.48 38.48 105.81 105.81 226.64 226.64 34.07 0.00 556.25
WCFB Webster City Federal Bancorp (MHC)17.00 64.13 53.13 53.13 53.13 53.13 283.33 284.76 60.39 4.00 156.25
WFD Westfield Financial Inc. (MHC) 24.65 259.33 61.63 61.63 91.30 77.03 197.99 197.99 31.77 0.81 55.56
All MHC's Average 26.22 856.60 59.40 67.82 53.94 58.45 266.30 289.93 33.65 2.00 143.03
All MHC's Median 23.15 114.54 40.63 50.05 45.51 53.99 235.46 284.76 31.89 1.95 78.57
All Second Step Conversions
BKMU Bank Mutual Corporation 11.49 904.35 35.91 35.91 35.91 35.91 278.21 337.94 32.41 1.22 34.09
BRKL Brookline Bancorp, Inc. 15.69 922.97 65.38 NA 62.76 NA 152.18 152.18 60.56 2.17 216.00
CSBC Citizens South Banking Corporation13.70 118.76 NM NM 33.41 34.25 131.48 143.76 24.63 1.75 56.10
FCAP First Capital, Inc. 22.00 62.17 17.19 17.19 16.92 17.05 143.32 166.41 15.59 2.73 41.54
FDEF First Defiance Financial Corp. 28.11 177.29 12.12 12.12 15.45 15.53 143.71 172.45 17.13 2.85 32.97
FFBK FloridaFirst Bancorp, Inc. 30.81 165.58 24.85 33.49 27.27 33.13 162.76 180.49 20.28 0.91 23.89
FFFD North Central Bancshares, Inc. 35.33 56.82 9.81 9.81 9.90 9.90 140.09 159.65 13.34 2.38 22.69
FFFL Fidelity Bankshares, Inc. 34.60 519.85 37.61 NA 28.36 NA 281.53 284.77 17.06 1.16 32.79
FFSX First Federal Bankshares, Inc. 24.49 92.38 16.11 14.58 16.01 16.55 132.38 181.14 14.39 1.47 20.92
FNFG First Niagara Financial Group, Inc15.56 1,101.86 25.93 NA 29.36 NA 141.71 168.22 30.70 1.54 41.51
FSLA First Sentinel Bancorp, Inc. 21.29 588.70 23.14 24.19 22.89 24.47 270.87 275.78 26.22 1.97 44.09
HARB Harbor Florida Bancshares, Inc. 28.97 690.27 17.66 NA 17.56 NA 256.83 NA 28.59 2.21 33.33
HFWA Heritage Financial Corporation 21.71 137.69 14.67 14.67 16.32 16.32 214.31 239.10 22.26 2.76 41.35
JFBI Jefferson Bancshares, Inc. 13.64 114.38 NA 28.42 NA 30.31 119.34 119.34 35.88 1.17 124.86
PBCPD Provident Bancorp, Inc. 11.45 453.53 40.89 40.89 35.78 39.48 341.79 390.78 34.34 1.18 40.19
PFSL Pocahontas Bancorp, Inc. 16.34 74.34 9.73 27.23 13.62 19.22 140.26 205.02 9.74 1.96 26.67
PHSB PHSB Financial Corp. 22.42 65.14 26.69 56.05 26.38 36.75 137.88 137.88 19.21 3.57 45.88
PULB Pulaski Financial Corp. 20.22 109.67 21.06 21.06 20.02 20.22 301.79 301.79 27.35 1.19 20.79
RVSB Riverview Bancorp, Inc. 21.35 100.94 13.02 13.02 18.57 NA 159.57 190.29 18.93 2.62 NA
SFFS Sound Federal Bancorp, Inc. 15.63 200.35 30.06 30.06 26.05 26.05 149.43 166.28 24.19 1.54 30.42
WAYN Wayne Savings Bancshares, Inc. 17.14 66.97 26.78 26.78 22.55 22.55 152.76 152.76 17.98 2.80 60.33
WGBC Willow Grove Bancorp, Inc. 17.95 183.65 28.05 34.52 26.01 32.64 165.74 167.29 22.12 2.01 46.38
Page 5 of 7
--------------------------------------------------------
Current Price in Relation to
-------------------------------------------------------- LTM
Current Current Tangible Current Dividend
Stock Market LTM LTM Book Book Dividend Payout
Price Value Earnings Core EPS EPS Core EPS Value Value Assets Yield Ratio
Ticker Short Name ($) ($M) (x) (x) (x) (x) (%) (%) (%) (%) (%)
- ------------------------------------------------------------------------------------------------------------------------------------
WYPT Waypoint Financial Corp. 22.99 773.98 19.16 20.53 18.25 20.35 187.06 196.83 14.25 2.09 33.71
All Second Steps Average 20.99 333.98 24.56 25.58 24.52 25.04 187.17 204.10 23.79 1.97 48.66
All Second Steps Median 21.29 165.58 23.14 25.49 22.72 23.51 152.76 176.47 22.12 1.97 37.14
Pennsylvania
ESBF ESB Financial Corporation 15.75 169.92 19.69 23.16 20.19 23.51 174.61 189.53 12.51 2.54 47.00
FSBI Fidelity Bancorp, Inc. 26.78 65.21 14.55 15.57 17.85 19.84 161.52 174.12 10.51 1.79 30.55
FKFS First Keystone Financial, Inc. 27.30 51.51 23.53 37.92 20.22 23.53 162.31 162.31 9.41 1.61 29.63
GAF GA Financial, Inc. 34.78 174.77 24.15 28.98 24.15 27.82 182.67 182.76 19.57 2.30 54.17
HARL Harleysville Savings Financial
Corporation 30.50 69.14 15.25 17.73 15.40 15.89 169.35 169.35 10.58 2.62 33.33
KNBT KNBT Bancorp, Inc. 17.55 532.87 NA NA NA NA NA NA NA 0.00 NA
LARL Laurel Capital Group, Inc. 25.50 47.86 26.56 26.56 21.79 21.79 174.78 204.16 15.65 3.14 65.81
NEPF Northeast Pennsylvania Financial
Corp 19.29 80.56 NM NM NM NM 144.06 180.61 8.98 2.49 NM
PVSA Parkvale Financial Corporation 27.63 153.03 16.06 18.18 15.44 17.06 152.57 172.26 9.53 2.61 40.22
PFNC Progress Financial Corporation 31.25 230.25 23.67 NA 26.26 NA 333.87 NA 19.69 1.66 27.24
SOV Sovereign Bancorp, Inc. 23.43 6,956.37 15.41 NA 16.98 NA 210.70 349.70 15.99 0.43 7.25
THRD TF Financial Corporation 34.22 96.14 NM NM NM NM 177.12 194.10 15.87 1.75 NM
WVFC WVS Financial Corp. 18.50 47.58 33.04 33.04 17.62 17.62 156.65 156.65 12.23 3.46 60.95
Pennsylvania Fully Converted Average 667.32 21.19 25.14 19.59 20.88 183.35 194.14 13.38 2.03 39.62
Pennsylvania Fully Converted Median 96.14 21.61 24.86 19.02 20.82 171.98 180.61 12.37 2.30 36.78
Pennsylvania MHC's
ALLB Greater Delaware Valley (MHC) 34.91 120.14 54.55 54.55 87.28 87.28 344.63 344.63 31.89 1.03 90.00
NWSB Northwest Bancorp, Inc. (MHC) 20.95 999.80 20.14 23.81 23.81 25.24 209.71 304.95 16.56 1.91 38.64
SKBO Skibo Financial Corp. (MHC) 16.93 53.39 38.48 38.48 105.81 105.81 226.64 226.64 34.07 0.00 556.25
Pennsylvania MHC's Average 391.11 37.72 38.95 72.30 72.78 260.33 292.07 27.51 0.98 228.30
Pennsylvania MHC's Median 120.14 38.48 38.48 87.28 87.28 226.64 304.95 31.89 1.03 90.00
Pennsylvania Second Steps
PHSB PHSB Financial Corp. 22.42 65.14 26.69 56.05 26.38 36.75 137.88 137.88 19.21 3.57 45.88
WYPT Waypoint Financial Corp. 22.99 773.98 19.16 20.53 18.25 20.35 187.06 196.83 14.25 2.09 33.71
WGBC Willow Grove Bancorp, Inc. 17.95 183.65 28.05 34.52 26.01 32.64 165.74 167.29 22.12 2.01 46.38
Pennsylvania Second Steps Average 340.92 24.63 37.03 23.55 29.91 163.56 167.33 18.53 2.56 41.99
Pennsylvania Second Steps Median 183.65 26.69 34.52 26.01 32.64 165.74 167.29 19.21 2.09 45.88
Comparable Group
ALFC Atlantic Liberty Financial Corp 18.98 32.47 21.57 21.57 NA NA 125.53 125.53 20.41 1.05 NA
AMFC AMB Financial Corp. 14.58 13.84 13.02 11.76 12.79 11.76 113.64 113.64 9.32 1.37 17.02
CKFB CKF Bancorp, Inc. 16.10 23.69 13.88 NA 14.91 NA 157.23 169.65 16.34 2.98 40.74
CIBI Community Investors Bancorp, Inc. 16.42 17.79 18.66 18.66 17.10 17.10 136.15 136.15 14.53 2.07 33.85
ESBK Elmira Savings Bank, FSB 31.01 32.20 13.60 13.60 13.31 14.49 148.44 152.61 11.05 2.45 30.00
FFDF FFD Financial Corporation 15.15 18.41 25.25 25.25 18.48 18.48 108.29 108.29 13.47 2.77 48.78
FNFI First Niles Financial, Inc. 17.75 24.65 22.19 26.10 22.76 25.72 153.55 153.55 24.91 3.38 71.79
Page 6 of 7
--------------------------------------------------------
Current Price in Relation to
-------------------------------------------------------- LTM
Current Current Tangible Current Dividend
Stock Market LTM LTM Book Book Dividend Payout
Price Value Earnings Core EPS EPS Core EPS Value Value Assets Yield Ratio
Ticker Short Name ($) ($M) (x) (x) (x) (x) (%) (%) (%) (%) (%)
- ------------------------------------------------------------------------------------------------------------------------------------
FKKY Frankfort First Bancorp, Inc. 22.21 28.02 32.66 29.22 NA 24.14 156.08 156.08 20.13 5.04 121.74
HWEN Home Financial Bancorp 6.21 8.42 19.41 19.41 23.88 17.74 123.71 123.71 13.62 1.93 46.15
NBSI North Bancshares, Inc. 14.50 16.60 30.21 45.31 45.31 43.94 122.78 122.78 12.85 2.21 110.81
PSFC Peoples-Sidney Financial Corporati16.20 23.32 23.82 22.50 24.18 24.92 133.77 133.77 16.58 3.46 81.54
PBNC PFS Bancorp, Inc. 20.09 29.61 33.48 33.48 34.05 33.48 111.36 111.36 25.17 1.49 46.61
SZB SouthFirst Bancshares, Inc. 16.75 12.12 NM NM 111.67 NM 103.84 108.91 9.07 3.58 400.00
UTBI United Tennessee Bankshares, Inc. 19.50 24.22 14.34 14.34 14.77 14.89 147.84 155.50 20.58 1.69 25.00
Comparable Average 21.81 21.70 23.43 29.43 22.42 131.59 133.68 16.29 2.53 82.62
Comparable Median 23.51 21.57 22.04 20.62 18.48 129.65 129.65 15.44 2.33 46.61
All Fully Converted Average 662.00 20.27 22.63 20.00 19.95 170.83 180.85 15.88 1.88 37.40
All Fully Converted Median 81.06 16.15 17.21 16.23 17.45 154.27 158.77 14.91 1.94 31.32
All Second Steps Average 333.98 24.56 25.58 24.52 25.04 187.17 204.10 23.79 1.97 48.66
All Second Steps Median 165.58 23.14 25.49 22.72 23.51 152.76 176.47 22.12 1.97 37.14
All MHC's Average 856.60 59.40 67.82 53.94 58.45 266.30 289.93 33.65 2.00 143.03
All MHC's Median 114.54 40.63 50.05 45.51 53.99 235.46 284.76 31.89 1.95 78.57
Pennsylvania Fully Converted Average 667.32 21.19 25.14 19.59 20.88 183.35 194.14 13.38 2.03 39.62
Pennsylvania Fully Converted Median 96.14 21.61 24.86 19.02 20.82 171.98 180.61 12.37 2.30 36.78
Pennsylvania MHC's Average 391.11 37.72 38.95 72.30 72.78 260.33 292.07 27.51 0.98 228.30
Pennsylvania MHC's Median 120.14 38.48 38.48 87.28 87.28 226.64 304.95 31.89 1.03 90.00
Pennsylvania Second Steps Average 340.92 24.63 37.03 23.55 29.91 163.56 167.33 18.53 2.56 41.99
Pennsylvania Second Steps Median 183.65 26.69 34.52 26.01 32.64 165.74 167.29 19.21 2.09 45.88
Page 7 of 7
Exhibit 8.
List of Fully Converted Thrifts Located in the Mid Atlantic Region
Total Assets
MstRctQtr
Company Name Ticker State Region ($000)
- --------------------------------------------------------------------------------
Atlantic Liberty Financial Corp ALFC NY MA 159,080
Independence Federal Savings Bank IFSB DC MA 217,492
Elmira Savings Bank, FSB ESBK NY MA 291,292
Laurel Capital Group, Inc. LARL PA MA 307,278
PHSB Financial Corp. PHSB PA MA 339,284
WVS Financial Corp. WVFC PA MA 388,872
Carver Bancorp, Inc. CNY NY MA 521,928
First Keystone Financial, Inc. FKFS PA MA 558,667
TF Financial Corporation THRD PA MA 604,682
Fidelity Bancorp, Inc. FSBI PA MA 617,468
Pamrapo Bancorp, Inc. PBCI NJ MA 642,482
Harleysville Savings Financial CorporatiHARL PA MA 653,288
Warwick Community Bancorp, Inc. WSBI NY MA 771,754
Willow Grove Bancorp, Inc. WGBC PA MA 830,361
Sound Federal Bancorp, Inc. SFFS NY MA 850,988
GA Financial, Inc. GAF PA MA 882,962
Northeast Pennsylvania Financial Corp. NEPF PA MA 896,295
Progress Financial Corporation PFNC PA MA 1,169,573
Provident Bancorp, Inc. PBCPD NY MA 1,174,305
FMS Financial Corporation FMCO NJ MA 1,195,458
Total Assets
MstRctQtr
Company Name Ticker State Region ($000)
- --------------------------------------------------------------------------------
ESB Financial Corporation ESBF PA MA 1,357,795
KNBT Bancorp, Inc. KNBT PA MA 1,368,045
Parkvale Financial Corporation PVSA PA MA 1,605,320
OceanFirst Financial Corp. OCFC NJ MA 1,754,594
PennFed Financial Services, Inc. PFSB NJ MA 1,778,169
Flushing Financial Corporation FFIC NY MA 1,849,097
WSFS Financial Corporation WSFS DE MA 2,207,077
First Sentinel Bancorp, Inc. FSLA NJ MA 2,245,130
Hudson River Bancorp, Inc. HRBT NY MA 2,579,259
Dime Community Bancshares, Inc. DCOM NY MA 3,085,131
First Niagara Financial Group, Inc. FNFG NY MA 3,589,507
Provident Financial Services, Inc. PFS NJ MA 4,171,198
Waypoint Financial Corp. WYPT PA MA 5,429,818
Staten Island Bancorp, Inc. SIB NY MA 7,554,089
Independence Community Bank Corp. ICBC NY MA 9,546,607
New York Community Bancorp, Inc. NYB NY MA 12,878,020
Astoria Financial Corporation AF NY MA 22,069,088
GreenPoint Financial Corp. GPT NY MA 22,866,000
Sovereign Bancorp, Inc. SOV PA MA 43,505,329
Exhibit 9
Standard Conversion 2001 to Date
Selected Market Data
Market Data as of 1/20/2004
Pro Forma
IPO Gross Conversion Total
IPO Price Proceeds Assets Equity
Ticker Short Name Date ($) ($000) ($000) ($000)
- -----------------------------------------------------------------------------------------------
KNBT KNBT Bancorp, Inc. 11/03/2003 10.0000 204,596 1,039,659 379,473
RPFG Rainier Pacific Financial Group, 10/21/2003 10.0000 79,350 530,935 110,259
------------------------------------------------------------------------------------
Q3`03 Average
Median
------------------------------------------------------------------------------------
CFBC Community First Bancorp, Inc. 06/27/2003 10.0000 2,777 29,968 4,130
RFBK Rantoul First Bank, SB 04/02/2003 10.0000 1,910 30,563 3,267
------------------------------------------------------------------------------------
Q2`03 Average
Median
------------------------------------------------------------------------------------
PFS Provident Financial Services, Inc01/16/2003 10.0000 596,183 3,066,277 826,469
CCFC CCSB Financial Corp. 01/09/2003 10.0000 9,787 77,872 14,570
------------------------------------------------------------------------------------
Q1`03 Average
Median
------------------------------------------------------------------------------------
------------------------------------------------------------------------------------
2003 YTD Average
Median
------------------------------------------------------------------------------------
ALFC Atlantic Liberty Financial Corp 10/23/2002 10.0000 17,110 124,044 23,096
TONE TierOne Corporation 10/02/2002 10.0000 220,751 1,543,512 315,372
------------------------------------------------------------------------------------
Q4`02 Average
Median
------------------------------------------------------------------------------------
MCBF Monarch Community Bancorp, Inc. 08/30/2002 10.0000 23,144 172,688 34,972
FPTB First PacTrust Bancorp, Inc. 08/23/2002 12.0000 63,480 349,349 83,253
------------------------------------------------------------------------------------
Q3`02 Average
Median
------------------------------------------------------------------------------------
RSVB Reserve Bancorp, Inc. 04/08/2002 10.0000 7,575 44,855 11,426
------------------------------------------------------------------------------------
Q2`02 Average
Median
------------------------------------------------------------------------------------
HRGB Heritage Bancshares, Inc. 02/26/2002 10.0000 4,915 40,351 7,869
------------------------------------------------------------------------------------
Q1`02 Average
Median
------------------------------------------------------------------------------------
------------------------------------------------------------------------------------
2002 Average
Median
------------------------------------------------------------------------------------
AFBA Allied First Bancorp, Inc. 12/31/2001 10.0000 6,094 82,195 9,525
CSFC City Savings Financial Corp. 12/28/2001 10.0000 5,555 66,253 9,517
PBNC PFS Bancorp, Inc. 10/12/2001 10.0000 15,209 113,387 26,475
------------------------------------------------------------------------------------
Q4`01 Average
Median
------------------------------------------------------------------------------------
GLBP Globe Bancorp, Inc. 07/10/2001 10.0000 3,042 24,797 5,625
------------------------------------------------------------------------------------
Q3`01 Average
Median
------------------------------------------------------------------------------------
BAFI BancAffiliated, Inc. 06/01/2001 10.0000 2,645 28,031 4,415
CFSL Chesterfield Financial Corp. 05/02/2001 10.0000 43,047 305,480 71,863
FBTC First BancTrust Corporation 04/19/2001 10.0000 15,209 170,466 25,599
------------------------------------------------------------------------------------
Q2`01 Average
Median
------------------------------------------------------------------------------------
BUCS BUCS Financial Corp 03/15/2001 9.0910 4,051 70,370 8,942
CTZN Citizens First Bancorp, Inc. 03/07/2001 10.0000 88,211 741,570 137,363
------------------------------------------------------------------------------------
Q1`01 Average
Median
------------------------------------------------------------------------------------
------------------------------------------------------------------------------------
2001 Average
Median
------------------------------------------------------------------------------------
------------------------------------------------------------------------------------
1/1/2001 toAverage
1/20/04 Median
------------------------------------------------------------------------------------
Pro Forma Pro Forma Pro FormaAdjusted
Book Value Tang. Book Earnings Assets
Ticker Short Name (%) (%) (x) (%)
- -------------------------------------------------------------------------------------
KNBT KNBT Bancorp, Inc. 53.92 53.92 14.90 16.4
RPFG Rainier Pacific Financial Group, Inc. 71.97 72.14 30.90 13.0
--------------------------------------------------------------------------
Q3`03 Average 62.95 63.03 22.90 14.70
Median 62.95 63.03 22.90 14.70
--------------------------------------------------------------------------
CFBC Community First Bancorp, Inc. 67.24 67.24 NA 8.5
RFBK Rantoul First Bank, SB 58.46 58.46 NA 5.9
--------------------------------------------------------------------------
Q2`03 Average 62.85 62.85 NA 7.20
Median 62.85 62.85 NA 7.20
--------------------------------------------------------------------------
PFS Provident Financial Services, Inc. 72.14 74.17 17.50 16.3
CCFC CCSB Financial Corp. 67.17 67.17 94.20 11.2
--------------------------------------------------------------------------
Q1`03 Average 69.66 70.67 55.85 13.75
Median 69.66 70.67 55.85 13.75
--------------------------------------------------------------------------
--------------------------------------------------------------------------
2003 YTD Average 65.15 65.52 39.38 11.88
Median 67.21 67.21 24.20 12.10
--------------------------------------------------------------------------
ALFC Atlantic Liberty Financial Corp 74.08 74.08 14.60 12.1
TONE TierOne Corporation 70.00 70.00 12.70 12.5
--------------------------------------------------------------------------
Q4`02 Average 72.04 72.04 13.65 12.30
Median 72.04 72.04 13.65 12.30
--------------------------------------------------------------------------
MCBF Monarch Community Bancorp, Inc. 66.18 66.18 41.50 11.8
FPTB First PacTrust Bancorp, Inc. 76.25 76.25 28.20 15.4
--------------------------------------------------------------------------
Q3`02 Average 71.22 71.22 34.85 13.60
Median 71.22 71.22 34.85 13.60
--------------------------------------------------------------------------
RSVB Reserve Bancorp, Inc. 66.30 66.30 17.30 14.4
--------------------------------------------------------------------------
Q2`02 Average 66.30 66.30 17.30 14.40
Median 66.30 66.30 17.30 14.40
--------------------------------------------------------------------------
HRGB Heritage Bancshares, Inc. 62.46 62.46 11.60 10.9
--------------------------------------------------------------------------
Q1`02 Average 62.46 62.46 11.60 10.90
Median 62.46 62.46 11.60 10.90
--------------------------------------------------------------------------
--------------------------------------------------------------------------
2002 Average 69.21 69.21 20.98 12.85
Median 68.15 68.15 15.95 12.30
--------------------------------------------------------------------------
AFBA Allied First Bancorp, Inc. 63.98 63.98 7.50 6.9
CSFC City Savings Financial Corp. 58.37 58.37 9.10 7.7
PBNC PFS Bancorp, Inc. 57.45 57.45 16.20 11.8
--------------------------------------------------------------------------
Q4`01 Average 59.93 59.93 10.93 8.80
Median 58.37 58.37 9.10 7.70
--------------------------------------------------------------------------
GLBP Globe Bancorp, Inc. 54.08 54.08 26.60 10.9
--------------------------------------------------------------------------
Q3`01 Average 54.08 54.08 26.60 10.90
Median 54.08 54.08 26.60 10.90
--------------------------------------------------------------------------
BAFI BancAffiliated, Inc. 59.91 59.91 11.30 8.6
CFSL Chesterfield Financial Corp. 59.90 60.47 11.00 12.4
FBTC First BancTrust Corporation 59.41 59.41 10.40 8.2
--------------------------------------------------------------------------
Q2`01 Average 59.74 59.93 10.90 9.73
Median 59.90 59.91 11.00 8.60
--------------------------------------------------------------------------
BUCS BUCS Financial Corp 45.30 45.30 13.40 5.4
CTZN Citizens First Bancorp, Inc. 64.22 64.22 9.60 10.6
--------------------------------------------------------------------------
Q1`01 Average 54.76 54.76 11.50 8.00
Median 54.76 54.76 11.50 8.00
--------------------------------------------------------------------------
--------------------------------------------------------------------------
2001 Average 58.07 58.13 12.79 9.17
Median 59.41 59.41 11.00 8.60
--------------------------------------------------------------------------
--------------------------------------------------------------------------
1/1/2001 toAverage 63.28 63.41 20.97 11.00
1/20/04 Median 63.98 63.98 14.60 11.20
--------------------------------------------------------------------------
---------------------------------------
Percent Change from IPO
---------------------------------------
After After After After
1 Day 1 Week 1 Month3 MonthTo date
Ticker Short Name (%) (%) (%) (%) (%)
- -------------------------------------------------------------------------------------
KNBT KNBT Bancorp, Inc. 68.80 68.20 69.70 NA 75.50
RPFG Rainier Pacific Financial Group, Inc. 69.90 65.20 61.00 NA 60.90
--------------------------------------------------------------------------
Q3`03 Average 69.35 66.70 65.35 NA 68.20
Median 69.35 66.70 65.35 NA 68.20
--------------------------------------------------------------------------
CFBC Community First Bancorp, Inc. 20.00 20.30 20.50 22.00 58.70
RFBK Rantoul First Bank, SB 15.10 20.00 23.50 28.00 100.00
--------------------------------------------------------------------------
Q2`03 Average 17.55 20.15 22.00 25.00 79.35
Median 17.55 20.15 22.00 25.00 79.35
--------------------------------------------------------------------------
PFS Provident Financial Services, Inc. 55.00 55.20 51.50 61.10 85.60
CCFC CCSB Financial Corp. 20.00 23.10 25.00 25.00 60.50
--------------------------------------------------------------------------
Q1`03 Average 37.50 39.15 38.25 43.05 73.05
Median 37.50 39.15 38.25 43.05 73.05
--------------------------------------------------------------------------
--------------------------------------------------------------------------
2003 YTD Average 41.47 42.00 41.87 34.03 73.53
Median 37.50 39.15 38.25 26.50 68.20
--------------------------------------------------------------------------
ALFC Atlantic Liberty Financial Corp 30.20 31.60 33.30 40.00 89.80
TONE TierOne Corporation 40.00 37.00 39.20 51.60 134.80
--------------------------------------------------------------------------
Q4`02 Average 35.10 34.30 36.25 45.80 112.30
Median 35.10 34.30 36.25 45.80 112.30
--------------------------------------------------------------------------
MCBF Monarch Community Bancorp, Inc. 16.80 14.00 1.10 14.10 60.20
FPTB First PacTrust Bancorp, Inc. 18.58 21.50 18.75 28.33 84.17
--------------------------------------------------------------------------
Q3`02 Average 17.69 17.75 9.93 21.22 72.18
Median 17.69 17.75 9.93 21.22 72.18
--------------------------------------------------------------------------
RSVB Reserve Bancorp, Inc. 25.00 28.00 29.00 29.00 97.50
--------------------------------------------------------------------------
Q2`02 Average 25.00 28.00 29.00 29.00 97.50
Median 25.00 28.00 29.00 29.00 97.50
--------------------------------------------------------------------------
HRGB Heritage Bancshares, Inc. 20.50 17.50 15.10 22.00 153.50
--------------------------------------------------------------------------
Q1`02 Average 20.50 17.50 15.10 22.00 153.50
Median 20.50 17.50 15.10 22.00 153.50
--------------------------------------------------------------------------
--------------------------------------------------------------------------
2002 Average 25.18 24.93 22.74 30.84 103.33
Median 22.75 24.75 23.88 28.67 93.65
--------------------------------------------------------------------------
AFBA Allied First Bancorp, Inc. 19.00 18.50 19.20 21.00 60.00
CSFC City Savings Financial Corp. 22.00 22.50 27.50 40.00 177.40
PBNC PFS Bancorp, Inc. 21.50 24.50 24.50 36.10 100.90
--------------------------------------------------------------------------
Q4`01 Average 20.83 21.83 23.73 32.37 112.77
Median 21.50 22.50 24.50 36.10 100.90
--------------------------------------------------------------------------
GLBP Globe Bancorp, Inc. 13.12 10.60 11.00 8.50 85.00
--------------------------------------------------------------------------
Q3`01 Average 13.12 10.60 11.00 8.50 85.00
Median 13.12 10.60 11.00 8.50 85.00
--------------------------------------------------------------------------
BAFI BancAffiliated, Inc. 0.00 0.00 7.50 7.50 120.00
CFSL Chesterfield Financial Corp. 36.50 39.90 43.50 57.00 153.10
FBTC First BancTrust Corporation 13.20 12.90 21.10 31.00 139.99
--------------------------------------------------------------------------
Q2`01 Average 16.57 17.60 24.03 31.83 137.70
Median 13.20 12.90 21.10 31.00 139.99
--------------------------------------------------------------------------
BUCS BUCS Financial Corp 30.00 36.25 36.87 52.50 145.00
CTZN Citizens First Bancorp, Inc. 38.13 35.00 32.50 50.60 128.90
--------------------------------------------------------------------------
Q1`01 Average 34.07 35.63 34.69 51.55 136.95
Median 34.07 35.63 34.69 51.55 136.95
--------------------------------------------------------------------------
--------------------------------------------------------------------------
2001 Average 21.49 22.24 24.85 33.80 123.37
Median 21.50 22.50 24.50 36.10 128.90
--------------------------------------------------------------------------
--------------------------------------------------------------------------
1/1/2001 toAverage 28.25 28.65 29.11 32.91 103.40
1/20/04 Median 21.50 23.10 25.00 29.00 97.50
--------------------------------------------------------------------------
-------------------------------------------------------------
Current Price to
-------------------------------------------------------------
Current Book Tangible LTM Core LTM
Stock Price Value Book Earnings Earnings EPS EPS Assets
Ticker Short Name 1/20/04 (%) (%) (X) (X) (X) (X) (%)
- ---------------------------------------------------------------------------------------------------------------------
KNBT KNBT Bancorp, Inc. 17.55 NA NA NA NA NA NA NA
RPFG Rainier Pacific Financial Group, Inc. 16.09 NA NA NA NA NA NA NA
----------------------------------------------------------------------------------------------------------
Q3`03 Average 16.82 NA NA NA NA NA NA NA
Median 16.82 NA NA NA NA NA NA NA
----------------------------------------------------------------------------------------------------------
CFBC Community First Bancorp, Inc. 15.87 101.60 101.60 NA 99.19 99.19 NA 11.32
RFBK Rantoul First Bank, SB 20.00 134.59 134.59 NA NM NM NA 12.05
----------------------------------------------------------------------------------------------------------
Q2`03 Average 17.94 118.10 118.10 NA NA NA NA 11.69
Median 17.94 118.10 118.10 NA NA NA NA 11.69
----------------------------------------------------------------------------------------------------------
PFS Provident Financial Services, Inc. 18.56 136.87 140.82 NA 33.14 35.69 NA 27.35
CCFC CCSB Financial Corp. 16.05 104.42 104.42 NA 133.75 133.75 NA 18.38
----------------------------------------------------------------------------------------------------------
Q1`03 Average 17.31 120.65 122.62 NA 83.45 84.72 NA 22.87
Median 17.31 120.65 122.62 NA 83.45 84.72 NA 22.87
----------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------
2003 YTD Average 17.35 119.37 120.36 NA 88.69 89.54 NA 17.28
Median 16.82 119.51 119.51 NA 99.19 99.19 NA 15.22
----------------------------------------------------------------------------------------------------------
ALFC Atlantic Liberty Financial Corp 18.98 125.53 125.53 NA 21.57 21.57 NA 20.41
TONE TierOne Corporation 23.48 155.19 155.19 24.46 19.57 19.57 24.46 25.26
----------------------------------------------------------------------------------------------------------
Q4`02 Average 21.23 140.36 140.36 24.46 20.57 20.57 24.46 22.84
Median 21.23 140.36 140.36 24.46 20.57 20.57 24.46 22.84
----------------------------------------------------------------------------------------------------------
MCBF Monarch Community Bancorp, Inc. 16.02 103.42 103.42 NA 33.38 33.38 NA 18.46
FPTB First PacTrust Bancorp, Inc. 22.10 122.23 122.23 29.47 27.63 27.63 28.70 18.89
----------------------------------------------------------------------------------------------------------
Q3`02 Average 19.06 112.83 112.83 NA 30.51 30.51 NA 18.68
Median 19.06 112.83 112.83 NA 30.51 30.51 NA 18.68
----------------------------------------------------------------------------------------------------------
RSVB Reserve Bancorp, Inc. 19.75 115.56 115.56 18.99 17.03 16.46 19.36 20.23
----------------------------------------------------------------------------------------------------------
Q2`02 Average 19.75 115.56 115.56 18.99 17.03 16.46 19.36 20.23
Median 19.75 115.56 115.56 18.99 17.03 16.46 19.36 20.23
----------------------------------------------------------------------------------------------------------
HRGB Heritage Bancshares, Inc. 25.35 152.07 152.07 NM NM NM NA 22.68
----------------------------------------------------------------------------------------------------------
Q1`02 Average 25.35 152.07 152.07 NA NA NA NA 22.68
Median 25.35 152.07 152.07 NA NA NA NA 22.68
----------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------
2002 Average 20.95 129.00 129.00 24.31 23.84 23.72 24.17 20.99
Median 20.93 123.88 123.88 24.46 21.57 21.57 24.46 20.32
----------------------------------------------------------------------------------------------------------
AFBA Allied First Bancorp, Inc. 16.00 90.24 90.24 23.88 28.57 30.77 24.24 6.89
CSFC City Savings Financial Corp. 27.74 134.73 134.73 8.75 7.22 7.62 10.71 10.45
PBNC PFS Bancorp, Inc. 20.09 111.36 111.36 34.05 33.48 33.48 33.48 25.17
----------------------------------------------------------------------------------------------------------
Q4`01 Average 21.28 112.11 112.11 22.23 23.09 23.96 22.81 14.17
Median 20.09 111.36 111.36 23.88 28.57 30.77 24.24 10.45
----------------------------------------------------------------------------------------------------------
GLBP Globe Bancorp, Inc. 18.50 91.77 91.77 29.37 38.54 38.54 29.37 15.54
----------------------------------------------------------------------------------------------------------
Q3`01 Average 18.50 91.77 91.77 29.37 38.54 38.54 29.37 15.54
Median 18.50 91.77 91.77 29.37 38.54 38.54 29.37 15.54
----------------------------------------------------------------------------------------------------------
BAFI BancAffiliated, Inc. 22.0000 108.32 108.32 10.78 9.48 9.48 10.78 7.21
CFSL Chesterfield Financial Corp. 25.3100 133.35 134.20 35.65 42.18 42.18 35.65 26.63
FBTC First BancTrust Corporation 23.9990 117.53 117.53 14.46 13.33 15.79 15.09 13.47
----------------------------------------------------------------------------------------------------------
Q2`01 Average 23.77 119.73 120.02 20.30 21.66 22.48 20.51 15.77
Median 24.00 117.53 117.53 14.46 13.33 15.79 15.09 13.47
----------------------------------------------------------------------------------------------------------
BUCS BUCS Financial Corp 22.27 91.32 94.94 17.54 17.96 17.96 17.96 7.61
CTZN Citizens First Bancorp, Inc. 22.89 125.98 125.98 14.13 15.06 NA NA 18.32
----------------------------------------------------------------------------------------------------------
Q1`01 Average 22.58 108.65 110.46 15.84 16.51 17.96 17.96 12.97
Median 22.58 108.65 110.46 15.84 16.51 17.96 17.96 12.97
----------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------
2001 Average 22.09 111.62 112.12 20.96 22.87 24.48 22.16 14.59
Median 22.27 111.36 111.36 17.54 17.96 24.37 21.10 13.47
----------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------
1/1/2001 toAverage 20.41 118.74 119.18 21.79 34.77 36.44 22.71 17.17
1/20/04 Median 20.00 117.53 117.53 21.44 27.63 29.20 24.24 18.38
----------------------------------------------------------------------------------------------------------
Exhibit 10. Appraisal Pro Forma October 31, 2003
SE Financial Corp.
Pro Forma Analysis Sheet - Twelve Months Ended
October 31, 2003
Includes SOP 93-6
------------------------------------------------------------------------------
Bank Comparables State National
------------------------------------------------------------------------------
Mean Median Mean Median Mean Median
Min 25.64
Price-Core Earnings Ratio P/E Mid 30.30 22.42 18.48 20.88 20.82 19.95 17.45
- ----------------------------- Max 33.33
Smax 38.46
Min 73.15%
Price-to-Book Ratio P/B Mid 77.40% 131.59% 129.65% 183.35% 171.98% 170.83% 154.27%
- ----------------------- Max 80.84%
Smax 84.10%
Min 73.15%
Price-to-Tangible Book Ratio P/TB Mid 77.40% 133.68% 129.65% 194.14% 180.61% 180.85% 158.77%
- --------------------------------- Max 80.84%
Smax 84.10%
Min 14.87%
Price-to-Assets Ratio P/A Mid 17.11% 16.29% 15.44% 13.38% 12.37% 15.88% 14.91%
- ------------------------- Max 19.24%
Smax 21.59%
Page 1
Exhibit 10. Appraisal Pro Forma October 31, 2003
Valuation Parameters
- ----------------------------------------------------------------------------
Prior Twelve Mos. Earning Base Y
Period Ended October 31, 2003 $ 556 (1)
- ----------------------------------------------------------------------------
Pre-Conversion Book Value B
As of October 31, 2003 $ 7,672
- ----------------------------------------------------------------------------
Pre-Conversion Assets A
As of October 31, 2003 $ 87,367
- ----------------------------------------------------------------------------
Return on Money R 1.44% (2)
- ----------------------------------------------------------------------------
Conversion Expenses $ 461
X 2.63% (3)
- ----------------------------------------------------------------------------
Proceeds Not Invested $ 2,100 (4)
- ----------------------------------------------------------------------------
Estimated ESOP Borrowings $ 1,400
ESOP Purchases E 8.00% (5)
Cost of ESOP Borrowings $ 140 (5)
Cost of ESOP Borrowings S 0.00% (5)
Amort of ESOP Borrowings T 10 Years
- ----------------------------------------------------------------------------
Amort of MRP Amount N 5 Years
Estimated MRP Amount $ 700 (6)
MRP Purchases M 4.00%
MRP Expense $ 140
- ----------------------------------------------------------------------------
Foundation Amount $ - (7)
Foundation Amount F 0.00% 0.00%
Foundation Opportunity Cost $ -
Tax Benefit Z $ - (8)
- ----------------------------------------------------------------------------
Tax Rate TAX 38.00%
- ----------------------------------------------------------------------------
Percentage Sold PCT 100.00%
- ----------------------------------------------------------------------------
Amount to be issued to Public $ 17,500 (9)
- ----------------------------------------------------------------------------
Earnings Multiple 12
- ----------------------------------------------------------------------------
(1) Net income for the twelve months ended October 31, 2003.
(2) Net Return assumes a reinvestment rate of 2.33 percent (the 1 year Treasury
at October 31, 2003), and a tax rate of 38%.
(3) Conversion expenses reflect estimated expenses as presented in the offering
document.
(4) Includes Stock from ESOP and MRP.
(5) Assumes ESOP is amortized straight line over 10 years.
(6) Assumes MRP is amortized straight line over 5 years.
(7) Not applicable.
(8) Not Applicable.
(9) The amount to be offered to public.
Page 2
Exhibit 10. Appraisal Pro Forma October 31, 2003
Pro Forma Calculation
Calculation of Estimated Value (V) at Midpoint Value
3. V= P/E*Y = $17,500,000
-----
1-P/E*PCT*((1-X-E-M-F)*R-(1-TAX)*E/T-(1-TAX)*M/N)
2. V= P/B*(B+Z) = $17,500,000
---------
1-P/B*PCT*(1-X-E-M-F)
1. V= P/A*A = $17,500,000
-----
1-P/A*PCT*(1-X-E-M-F)
The appraisal was performed on a market basis and not on the above formulas.
- -------------------------------------------------------------------------------
Total Shares Price Total
Conclusion Shares Per Share Value
- -------------------------------------------------------------------------------
Appraised Value - Midpoint 1,750,000 $ 10.00 $ 17,500,000
Range:
- Minimum 1,487,500 10.00 14,875,000
- Maximum 2,012,500 10.00 20,125,000
- Super Maximum 2,314,375 10.00 23,143,750
Pre Foundation
-------------------------------------------------------
Appraised Value
-------------------------------------------------------
Conclusion Minimum Midpoint Maximum SuperMaximum*
-------------------------------------------------------
Total Shares 1,487,500 1,750,000 2,012,500 2,314,375
Price per Share $ 10 $ 10 $ 10 $ 10
Full Conversion Value $14,875,000 $ 17,500,000 $ 20,125,000 $ 23,143,750
Exchange Shares 0 0 0 0
Exchange Percent 0.00% 0.00% 0.00% 0.00%
Conversion Shares 1,487,500 1,750,000 2,012,500 2,314,375
Conversion Percent 100.00% 100.00% 100.00% 100.00%
Gross Proceeds $14,875,000 $ 17,500,000 $ 20,125,000 $ 23,143,750
Exchange Value $ - $ - $ - $ -
Exchange Ratio 0.0000 0.0000 0.0000 0.0000
-------------------------------------------------------
* SuperMaximum is an overallotment option that is 15% above the maximum amount.
Page 3
Exhibit 10. Appraisal Pro Forma October 31, 2003
Pro Forma Effect of Conversion Proceeds
As of October 31, 2003
(Dollars in Thousands)
- --------------------------------------------- ----------------------------------------------------
Conversion Proceeds Minimum Midpoint Maximum SuperMax
- --------------------------------------------- ----------------------------------------------------
Total Shares Offered 1,487,500 1,750,000 2,012,500 2,314,375
Conversion Shares Offered 1,487,500 1,750,000 2,012,500 2,314,375
Price Per Share $ 10 $ 10 $ 10 $ 10
----------------------------------------------------
Gross Proceeds $ 14,875 $ 17,500 $ 20,125 $ 23,144
Plus: Value issued to Foundation (9) - - - -
----------------------------------------------------
Pro Forma Market Capitalization 14,875 17,500 20,125 23,144
====================================================
Gross Proceeds 14,875 17,500 20,125 23,144
Less: Est. Conversion Expenses 437 461 485 513
Cash issued to foundation - - - -
----------------------------------------------------
Net Proceeds $ 14,438 $ 17,039 $ 19,640 $ 22,631
====================================================
- ---------------------------------------------
Estimated Income from Proceeds
- ---------------------------------------------
Net Conversion Proceeds $ 14,438 $ 17,039 $ 19,640 $ 22,631
Less: ESOP Adjustment (3) 1,190 1,400 1,610 1,852
Less: MRP Adjustment (3) 595 700 805 926
----------------------------------------------------
Net Proceeds Reinvested $ 12,653 $ 14,939 $ 17,225 $ 19,853
Estimated Incremental Rate of Return 1.44% 1.44% 1.44% 1.44%
----------------------------------------------------
Estimated Incremental Return $ 182 $ 215 $ 248 $ 286
Less: Cost of ESOP (4) - - - -
Less: Amortization of ESOP (7) 74 87 100 115
Less: MRP Adjustment (7) 74 87 100 115
----------------------------------------------------
Pro-forma Net Income 34 41 48 56
Earnings Before Conversion 556 556 556 556
----------------------------------------------------
Earnings Excluding Adjustment 590 597 604 612
Earnings Adjustment (6) (59) (60) (60) (61)
----------------------------------------------------
Earnings After Conversion $ 531 $ 537 $ 544 $ 551
----------------------------------------------------
Page 4
Exhibit 10. Appraisal Pro Forma October 31, 2003
Pro Forma Effect of Conversion Proceeds
As of October 31, 2003
(Dollars in Thousands)
---------------------------------------------------
Minimum Midpoint Maximum SuperMax
---------------------------------------------------
- ---------------------------------------------
Pro-forma Net Worth
- ---------------------------------------------
Net Worth at October 31, 2003 $ 7,672 $ 7,672 $ 7,672 $ 7,672
Net Conversion Proceeds 14,438 17,039 19,640 22,631
Plus: MHC Adjustment (7) - - - -
Plus: Value issued to Foundation - - - -
Less: After Tax Expense of Foundation - - - -
Less: ESOP Adjustment (1) (1,190) (1,400) (1,610) (1,852)
Less: MRP Adjustment (2) (595) (700) (805) (926)
---------------------------------------------------
Pro-forma Net Worth $ 20,325 $ 22,611 $ 24,897 $ 27,525
- ---------------------------------------------
Pro-forma Tangible Net Worth
- ---------------------------------------------
Pro-forma Net Worth $ 20,325 $ 22,611 $ 24,897 $ 27,525
Less: Intangible (5) - - - -
---------------------------------------------------
Pro-forma Tangible Net Worth $ 20,325 $ 22,611 $ 24,897 $ 27,525
- ---------------------------------------------
Pro-forma Assets
- ---------------------------------------------
Total Assets at October 31, 2003 $ 87,367 $ 87,367 $ 87,367 $ 87,367
Net Conversion Proceeds 14,438 17,039 19,640 22,631
Plus: MHC Adjustment (7) - - - -
Plus: Value issued to Foundation - - - -
Less: After Tax Expense of Foundation - - - -
Less: ESOP Adjustment (1) (1,190) (1,400) (1,610) (1,852)
Less: MRP Adjustment (2) (595) (700) (805) (926)
---------------------------------------------------
Pro-forma Assets Excluding Adjustment 100,020 102,306 104,592 107,220
Plus: Adjustment (6) - - - -
---------------------------------------------------
Pro-forma Total Assets $ 100,020 $ 102,306 $ 104,592 $ 107,220
---------------------------------------------------
- ---------------------------------------------
Stockholder's Equity Per Share
- ---------------------------------------------
Net Worth at October 31, 2003 $ 5.16 $ 4.38 $ 3.81 $ 3.31
Estimated Net Proceeds 9.71 9.74 9.76 9.78
Plus: MHC Adjustment - - - -
Plus: Value issued to Foundation - - - -
Less: After Tax Expense of Foundation - - - -
Less: ESOP Stock (0.80) (0.80) (0.80) (0.80)
Less: MRP Stock (0.40) (0.40) (0.40) (0.40)
---------------------------------------------------
Pro-forma Net Worth Per Share 13.67 12.92 12.37 11.89
Less: Intangible - - - -
---------------------------------------------------
Pro-forma Tangible Net Worth Per Share $ 13.67 $ 12.92 $ 12.37 $ 11.89
---------------------------------------------------
Page 5
Exhibit 10. Appraisal Pro Forma October 31, 2003
Pro Forma Effect of Conversion Proceeds
As of October 31, 2003
(Dollars in Thousands)
-----------------------------------------------------
Minimum Midpoint Maximum SuperMax
-----------------------------------------------------
- ---------------------------------------------
Net Earnings Per Share
- ---------------------------------------------
Historical Earnings Per Share (8) $ 0.40 $ 0.34 $ 0.30 $ 0.26
Incremental return Per Share (8) 0.13 0.13 0.13 0.13
ESOP Adjustment Per Share (8) (0.05) (0.05) (0.05) (0.05)
MRP Adjustment Per Share (8) (0.05) (0.05) (0.05) (0.05)
Normalizing Adjustment Per Share (0.04) (0.04) (0.03) (0.03)
-----------------------------------------------------
Pro Forma Earnings Per Share (8) $ 0.39 $ 0.33 $ 0.30 $ 0.26
=====================================================
- ---------------------------------------------
Shares Utilized
- ---------------------------------------------
Shares Utilized 1,381 1,624 1,868 2,148
-----------------------------------------------------
- ---------------------------------------------
Pro-forma Ratios
- ---------------------------------------------
Price/EPS without Adjustment 23.26 27.03 30.30 34.48
Price/EPS with Adjustment 25.64 30.30 33.33 38.46
Price/Book Value per Share 73.15% 77.40% 80.84% 84.10%
Price/Tangible Book Value 73.15% 77.40% 80.84% 84.10%
Market Value/Assets 14.87% 17.11% 19.24% 21.59%
-----------------------------------------------------
(1) ESOP Borrowings are deducted from net worth and assets, and amortized over
10 years.
(2) MRP Borrowings are omitted from net worth and assets, and amortized over 5
years.
(3) Consists of ESOP and MRP amortization.
(4) The ESOP loan is from the Holding Company and therefore, there are no
costs.
(5) Not applicable.
(6) 10% of Earnings tax impacted at 38%.
(7) ESOP and MRP are amortized over 10 and 5 years respectively, and tax
impacted at 38%.
(8) All EPS computations are done in accordance with SOP 93-6.
(9) Not applicable.
Page 6
Exhibit 10. Appraisal Pro Forma October 31, 2003
- ---------------------------------------------
Expense Calculations
- ---------------------------------------------
Total Shares Offered 1,488 1,750 2,013 2,314
Price Per Share $ 10 $ 10 $ 10 $ 10
----------------------------------------------------------
Gross Proceeds $ 14,875 $ 17,500 $ 20,125 $ 23,144
Estimated Insider Purchases - - - -
ESOP Purchases (1,190) (1,400) (1,610) (1,852)
----------------------------------------------------------
Proceeds to Base Fee On $ 13,685 $ 16,100 $ 18,515 $ 21,292
Underwriters Percentage 1.00% 1.00% 1.00% 1.00%
----------------------------------------------------------
Underwriters Fee $ 137 $ 161 $ 185 $ 213
Advisory Fee - - - -
----------------------------------------------------------
Total Underwriters Fee 137 161 185 213
All Other Expenses 300 300 300 300
----------------------------------------------------------
Total Expense $ 437 $ 461 $ 485 $ 513
- ---------------------------------------------
Shares Calculations
- ---------------------------------------------
Shares Outstanding (used for BV/Sh) 1,488 1,750 2,013 2,314
Less: New ESOP Adjustment 119 140 161 185
Less: Old ESOP Adjustment (1) 0 0 0 0
Plus: New SOP 93-6 ESOP Shares (2) 12 14 16 19
Plus: Old SOP 93-6 ESOP Shares (2) 0 0 0 0
----------------------------------------------------------
Shares for all EPS Calculations 1,381 1,624 1,868 2,148
==========================================================
Actual number of shares for EPS 1,380,400 1,624,000 1,867,600 2,147,740
Actual foundation shares 0 0 0 0
Post Foundation
----------------------------------------------------------------
Appraised Value
------------------------------------------------------------
Conclusion Minimum Midpoint Maximum SuperMaximum
------------------------------------------------------------
Shares Issued and Exchanged 1,487,500 1,750,000 2,012,500 2,314,375
Price per Share $ 10 $ 10 $ 10 $ 10
Shares Issued to Foundation - - - -
Total Shares 1,487,500 1,750,000 2,012,500 2,314,375
Exchange Shares - - - -
Conversion Shares 1,487,500 1,750,000 2,012,500 2,314,375
Implied Exhange Ratio - - - -
Gross Proceeds $14,875,000 $ 17,500,000 $ 20,125,000 $ 23,143,750
Exchange Value $ - $ - $ - $ -
------------------------------------------------------------
Page 7
Exhibit 10. Appraisal Pro Forma October 31, 2003
- ---------------------------------------------
MRP Dilution
- ---------------------------------------------
Shares Outstanding 1,487,500 1,750,000 2,012,500 2,314,375
Less: New ESOP Adjustment 119,000 140,000 161,000 185,150
Less: Old ESOP Adjustment 0 0 0 0
Plus: New MRP issued (1) 59,500 70,000 80,500 92,575
Plus: New SOP 93-6 ESOP Shares (2) 11,900 14,000 16,100 18,515
Plus: Old SOP 93-6 ESOP Shares 0 0 0 0
(2)
Shares for all EPS Calculations 1,439,900 1,694,000 1,948,100 2,240,315
EPS $ 0.37 $ 0.32 $ 0.29 $ 0.25
BV/Share $ 13.14 $ 12.42 $ 11.90 $ 11.44
Voting Dilution 4.30% 4.31% 4.32% 4.28%
- ------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------
Option Dilution
- ---------------------------------------------
Shares Outstanding 1,487,500 1,750,000 2,012,500 2,314,375
Less: New ESOP Adjustment 119,000 140,000 161,000 185,150
Less: Old ESOP Adjustment 0 0 0 0
Plus: Options (1) 148,750 175,000 201,250 231,438
Plus: New SOP 93-6 ESOP Shares (2) 11,900 14,000 16,100 18,515
Plus: Old SOP 93-6 ESOP Shares 0 0 0 0
(2)
Shares for all EPS Calculations 1,529,150 1,799,000 2,068,850 2,379,178
EPS $ 0.35 $ 0.30 $ 0.26 $ 0.23
BV/Share $ 13.33 $ 12.66 $ 12.16 $ 11.72
Voting Dilution 10.77% 10.78% 10.78% 10.74%
- ------------------------------------------------------------------------------------------------------------------
Page 8
Exhibit 11. Offering Circular Pro Forma October 31, 2003
SE Financial Corp.
Pro Forma Analysis Sheet - Twelve Months Ended
October 31, 2003
Includes SOP 93-6
---------------------------------------------------------------------------------------
Bank Comparables State National
---------------------------------------------------------------------------------------
Mean Median Mean Median Mean Median
---- ------ ---- ------ ---- ------
Min 23.26
Price-Core Earnings Ratio P/E Mid 27.03 22.42 18.48 20.88 20.82 19.95 17.45
Max 30.30
Smax 34.48
Min 73.15%
Price-to-Book Ratio P/B Mid 77.40% 131.59% 129.65% 183.35% 171.98% 170.83% 154.27%
Max 80.84%
Smax 84.10%
Min 73.15%
Price-to-Tangible Book Ratio P/TB Mid 77.40% 133.68% 129.65% 194.14% 180.61% 180.85% 158.77%
Max 80.84%
Smax 84.10%
Min 14.87%
Price-to-Assets Ratio P/A Mid 17.11% 16.29% 15.44% 13.38% 12.37% 15.88% 14.91%
Max 19.24%
Smax 21.59%
Page 1
Exhibit 11. Offering Circular Pro Forma October 31, 2003
Valuation Parameters
- -------------------------------------------------------------------------------
Prior Twelve Mos. Earning Base Y
Period Ended October 31, 2003 $ 556 (1)
- -------------------------------------------------------------------------------
Pre-Conversion Book Value B
As of October 31, 2003 $ 7,672
- -------------------------------------------------------------------------------
Pre-Conversion Assets A
As of October 31, 2003 $ 87,367
- -------------------------------------------------------------------------------
Return on Money R 1.44% (2)
- -------------------------------------------------------------------------------
Conversion Expenses $ 461
X 2.63% (3)
- -------------------------------------------------------------------------------
Proceeds Not Invested $ 2,100 (4)
- -------------------------------------------------------------------------------
Estimated ESOP Borrowings $ 1,400
ESOP Purchases E 8.00% (5)
Cost of ESOP Borrowings $ 140 (5)
Cost of ESOP Borrowings S 0.00% (5)
Amort of ESOP Borrowings T 10 Years
- -------------------------------------------------------------------------------
Amort of MRP Amount N 5 Years
Estimated MRP Amount $ 700 (6)
MRP Purchases M 4.00%
MRP Expense $ 140
- -------------------------------------------------------------------------------
Foundation Amount $ - (7)
Foundation Amount F 0.00% 0.00%
Foundation Opportunity Cost $ -
Tax Benefit Z $ - (8)
- -------------------------------------------------------------------------------
Tax Rate TAX 38.00%
- -------------------------------------------------------------------------------
Percentage Sold PCT 100.00%
- -------------------------------------------------------------------------------
Amount to be issued to Public $ 17,500 (9)
- -------------------------------------------------------------------------------
Earnings Multiple 12
- -------------------------------------------------------------------------------
(1) Net income for the twelve months ended October 31, 2003.
(2) Net Return assumes a reinvestment rate of 2.33 percent (the 1 year Treasury
at October 31, 2003), and a tax rate of 38%.
(3) Conversion expenses reflect estimated expenses as presented in the offering
document.
(4) Includes Stock from ESOP and MRP.
(5) Assumes ESOP is amortized straight line over 10 years.
(6) Assumes MRP is amortized straight line over 5 years.
(7) Not applicable.
(8) Not Applicable.
(9) The amount to be offered to public.
Page 2
Exhibit 11. Offering Circular Pro Forma October 31, 2003
Pro Forma Calculation
Calculation of Estimated Value (V) at Midpoint Value
3. V= P/E*Y = $17,500,000
1-P/E*PCT*((1-X-E-M-F)*R-(1-TAX)*E/T-(1-TAX)*M/N)
2. V= P/B*(B+Z) = $17,500,000
1-P/B*PCT*(1-X-E-M-F)
1. V= P/A*A = $17,500,000
1-P/A*PCT*(1-X-E-M-F)
The appraisal was performed on a market basis and not on the above formulas.
Total Shares Price Total
Conclusion Shares Per Share Value
Appraised Value - Midpoint 1,750,000 $ 10 $17,500,000
Range:
- Minimum 1,487,500 $ 10 14,875,000
- Maximum 2,012,500 10 20,125,000
- Super Maximum 2,314,375 10 23,143,750
Pre Foundation
--------------------------------------------------------------------------------
Appraised Value
--------------------------------------------------------------------------------
Conclusion Minimum Midpoint Maximum SuperMaximum *
--------------------------------------------------------------------------------
Total Shares 1,487,500 1,750,000 2,012,500 2,314,375
Price per Share $ 10 $ 10 $ 10 $ 10
Full Conversion Value $14,875,000 $17,500,000 $20,125,000 $ 23,143,750
Exchange Shares 0 0 0 0
Exchange Percent 0.00% 0.00% 0.00% 0.00%
Conversion Shares 1,487,500 1,750,000 2,012,500 2,314,375
Conversion Percent 100.00% 100.00% 100.00% 100.00%
Gross Proceeds $14,875,000 $17,500,000 $20,125,000 $ 23,143,750
Exchange Value $ - $ - $ - $ -
Exchange Ratio 0.0000 0.0000 0.0000 0.0000
--------------------------------------------------------------------------------
* SuperMaximum is an overallotment option that is 15% above the maximum amount.
Page 3
Exhibit 11. Offering Circular Pro Forma October 31, 2003
Pro Forma Effect of Conversion Proceeds
As of October 31, 2003
(Dollars in Thousands)
- --------------------------------------------- -------------------------------------------------------------------
Conversion Proceeds Minimum Midpoint Maximum SuperMax
- --------------------------------------------- -------------------------------------------------------------------
Total Shares Offered 1,487,500 1,750,000 2,012,500 2,314,375
Conversion Shares Offered 1,487,500 1,750,000 2,012,500 2,314,375
Price Per Share $ 10 $ 10 $ 10 $ 10
-------------------------------------------------------------------
Gross Proceeds $ 14,875 $ 17,500 $ 20,125 $ 23,144
Plus: Value issued to Foundation (9) - - - -
-------------------------------------------------------------------
Pro Forma Market Capitalization 14,875 17,500 20,125 23,144
===================================================================
Gross Proceeds 14,875 17,500 20,125 23,144
Less: Est. Conversion Expenses 437 461 485 513
Less: Cash issued to the Foundation - - - -
-------------------------------------------------------------------
Net Proceeds $ 14,438 $ 17,039 $ 19,640 $ 22,631
===================================================================
- ---------------------------------------------
Estimated Income from Proceeds
- ---------------------------------------------
Net Conversion Proceeds $ 14,438 $ 17,039 $ 19,640 $ 22,631
Less: ESOP Adjustment (3) 1,190 1,400 1,610 1,852
Less: MRP Adjustment (3) 595 700 805 926
-------------------------------------------------------------------
Net Proceeds Reinvested $ 12,653 $ 14,939 $ 17,225 $ 19,853
Estimated Incremental Rate of Return 1.44% 1.44% 1.44% 1.44%
-------------------------------------------------------------------
Estimated Incremental Return $ 182 $ 215 $ 248 $ 286
Less: Cost of ESOP (4) - - - -
Less: Amortization of ESOP (7) 74 87 100 115
Less: MRP Adjustment (7) 74 87 100 115
-------------------------------------------------------------------
Pro Forma Net Income 34 41 48 56
Earnings Before Conversion 556 556 556 556
-------------------------------------------------------------------
Earnings Excluding Adjustment 590 597 604 612
Earnings Adjustment (6) - - - -
-------------------------------------------------------------------
Earnings After Conversion $ 590 $ 597 $ 604 $ 612
-------------------------------------------------------------------
Page 4
Exhibit 11. Offering Circular Pro Forma October 31, 2003
Pro Forma Effect of Conversion Proceeds
As of October 31, 2003
(Dollars in Thousands)
----------------------------------------------------------------
Minimum Midpoint Maximum SuperMax
----------------------------------------------------------------
- ---------------------------------------------
Pro Forma Net Worth
- ---------------------------------------------
Net Worth at October 31, 2003 $ 7,672 $ 7,672 $ 7,672 $ 7,672
Net Conversion Proceeds 14,438 17,039 19,640 22,631
Plus: MHC Adjustment (7) - - - -
Plus: Value issued to Foundation - - - -
Less: After Tax Expense of Foundation - - - -
Less: ESOP Adjustment (1) (1,190) (1,400) (1,610) (1,852)
Less: MRP Adjustment (2) (595) (700) (805) (926)
----------------------------------------------------------------
Pro Forma Net Worth $ 20,325 $ 22,611 $ 24,897 $ 27,525
- ---------------------------------------------
Pro Forma Tangible Net Worth
- ---------------------------------------------
Pro Forma Net Worth $ 20,325 $ 22,611 $ 24,897 $ 27,525
Less: Intangible (5) - - - -
----------------------------------------------------------------
Pro Forma Tangible Net Worth $ 20,325 $ 22,611 $ 24,897 $ 27,525
- ---------------------------------------------
Pro Forma Assets
- ---------------------------------------------
Total Assets at October 31, 2003 $ 87,367 $ 87,367 $ 87,367 $ 87,367
Net Conversion Proceeds 14,438 17,039 19,640 22,631
Plus: MHC Adjustment (7) - - - -
Plus: Value issued to Foundation - - - -
Less: After Tax Expense of Foundation - - - -
Less: ESOP Adjustment (1) (1,190) (1,400) (1,610) (1,852)
Less: MRP Adjustment (2) (595) (700) (805) (926)
----------------------------------------------------------------
Pro Forma Assets Excluding Adjustment 100,020 102,306 104,592 107,220
Plus: Adjustment (6) - - - -
----------------------------------------------------------------
Pro Forma Total Assets $ 100,020 $ 102,306 $ 104,592 $ 107,220
----------------------------------------------------------------
- ---------------------------------------------
Stockholder's Equity Per Share
- ---------------------------------------------
Net Worth at October 31, 2003 $ 5.16 $ 4.38 $ 3.81 $ 3.31
Estimated Net Proceeds 9.71 9.74 9.76 9.78
Plus: MHC Adjustment - - - -
Plus: Value issued to Foundation - - - -
Less: After Tax Expense of Foundation - - - -
Less: ESOP Stock (0.80) (0.80) (0.80) (0.80)
Less: MRP Stock (0.40) (0.40) (0.40) (0.40)
----------------------------------------------------------------
Pro Forma Net Worth Per Share 13.67 12.92 12.37 11.89
Less: Intangible - - - -
----------------------------------------------------------------
Pro Forma Tangible Net Worth Per Share $ 13.67 $ 12.92 $ 12.37 $ 11.89
----------------------------------------------------------------
Page 5
Exhibit 11. Offering Circular Pro Forma October 31, 2003
Pro Forma Effect of Conversion Proceeds
As of October 31, 2003
(Dollars in Thousands)
----------------------------------------------------
Minimum Midpoint Maximum SuperMax
----------------------------------------------------
- ---------------------------------------------
Net Earnings Per Share
- ---------------------------------------------
Historical Earnings Per Share (8) $ 0.40 $ 0.34 $ 0.30 $ 0.26
Incremental return Per Share (8) 0.13 0.13 0.13 0.13
ESOP Adjustment Per Share (8) (0.05) (0.05) (0.05) (0.05)
MRP Adjustment Per Share (8) (0.05) (0.05) (0.05) (0.05)
Normalizing Adjustment Per Share - - - -
----------------------------------------------------
Pro Forma Earnings Per Share (8) $ 0.43 $ 0.37 $ 0.33 $ 0.29
- ---------------------------------------------
Shares Utilized
- ---------------------------------------------
Shares Utilized 1,381 1,624 1,868 2,148
- ---------------------------------------------
Pro Forma Ratios
- ---------------------------------------------
Price/EPS without Adjustment 23.26 27.03 30.30 34.48
Price/EPS with Adjustment 23.26 27.03 30.30 34.48
Price/Book Value per Share 73.15% 77.40% 80.84% 84.10%
Price/Tangible Book Value 73.15% 77.40% 80.84% 84.10%
Market Value/Assets 14.87% 17.11% 19.24% 21.59%
----------------------------------------------------
(1) ESOP Borrowings are deducted from net worth and assets, and amortized over
10 years.
(2) MRP Borrowings are omitted from net worth and assets, and amortized over 5
years.
(3) Consists of ESOP and MRP amortization.
(4) The ESOP loan is from the Holding Company and therefore, there are no
costs.
(5) Not applicable.
(6) Not applicable.
(7) ESOP and MRP are amortized over 10 and 5 years respectively, and tax
impacted at 38%.
(8) All EPS computations are done in accordance with SOP 93-6.
(9) Not applicable.
Page 6
Exhibit 11. Offering Circular Pro Forma October 31, 2003
- ---------------------------------------------
Expense Calculations
- ---------------------------------------------
Total Shares Offered 1,488 1,750 2,013 2,314
Price Per Share $ 10 $ 10 $ 10 $ 10
------------------------------------------------------------
Gross Proceeds $ 14,875 $ 17,500 $ 20,125 $ 23,144
Estimated Insider Purchases - - - -
ESOP Purchases (1,190) (1,400) (1,610) (1,852)
------------------------------------------------------------
Proceeds to Base Fee On $ 13,685 $ 16,100 $ 18,515 $ 21,292
Underwriters Percentage 1.00% 1.00% 1.00% 1.00%
------------------------------------------------------------
Underwriters Fee $ 137 $ 161 $ 185 $ 213
Advisory Fee - - - -
------------------------------------------------------------
Total Underwriters Fee 137 161 185 213
All Other Expenses 300 300 300 300
------------------------------------------------------------
Total Expense $ 437 $ 461 $ 485 $ 513
- ---------------------------------------------
Shares Calculations
- ---------------------------------------------
Shares Outstanding 1,488 1,750 2,013 2,314
Less: New ESOP Adjustment 119 140 161 185
Less: Old ESOP Adjustment (1) 0 0 0 0
Plus: New SOP 93-6 ESOP Shares (2) 12 14 16 19
Plus: Old SOP 93-6 ESOP Shares (2) 0 0 0 0
------------------------------------------------------------
Shares for all EPS Calculations 1,381 1,624 1,868 2,148
============================================================
Actual number of shares for EPS 1,380,400 1,624,000 1,867,600 2,147,740
Actual foundation shares 0 0 0 0
Post Foundation
------------------------------------------------------------------
Appraised Value
-------------------------------------------------------------
Conclusion Minimum Midpoint Maximum SuperMaximum
-------------------------------------------------------------
Shares Issued and Exchanged 1,487,500 1,750,000 2,012,500 2,314,375
Price per Share $ 10 $ 10 $ 10 $ 10
Shares Issued to Foundation - - - -
Total Shares 1,487,500 1,750,000 2,012,500 2,314,375
Exchange Shares - - - -
Conversion Shares 1,487,500 1,750,000 2,012,500 2,314,375
Implied Exhange Ratio - - - -
Gross Proceeds $14,875,000 $17,500,000 $20,125,000 $ 23,143,750
Exchange Value $ - $ - $ - $ -
-------------------------------------------------------------
Page 7
Exhibit 11. Offering Circular Pro Forma October 31, 2003
- ---------------------------------------------
MRP Dilution
- ---------------------------------------------
Shares Outstanding 1,487,500 1,750,000 2,012,500 2,314,375
Less: New ESOP Adjustment 119,000 140,000 161,000 185,150
Less: Old ESOP Adjustment 0 0 0 0
Plus: New MRP issued (1) 59,500 70,000 80,500 92,575
Plus: New SOP 93-6 ESOP Shares (2) 11,900 14,000 16,100 18,515
Plus: Old SOP 93-6 ESOP Shares 0 0 0 0
(2)
Shares for all EPS Calculations 1,439,900 1,694,000 1,948,100 2,240,315
EPS $ 0.42 $ 0.36 $ 0.32 $ 0.28
BV/Share $ 13.14 $ 12.42 $ 11.90 $ 11.44
Voting Dilution 4.30% 4.31% 4.32% 4.28%
- --------------------------------------------------------------------------------------------------------------
- ---------------------------------------------
Option Dilution
- ---------------------------------------------
Shares Outstanding 1,487,500 1,750,000 2,012,500 2,314,375
Less: New ESOP Adjustment 119,000 140,000 161,000 185,150
Less: Old ESOP Adjustment 0 0 0 0
Plus: Options (1) 148,750 175,000 201,250 231,438
Plus: New SOP 93-6 ESOP Shares (2) 11,900 14,000 16,100 18,515
Plus: Old SOP 93-6 ESOP Shares 0 0 0 0
(2)
Shares for all EPS Calculations 1,529,150 1,799,000 2,068,850 2,379,178
EPS $ 0.39 $ 0.33 $ 0.29 $ 0.26
BV/Share $ 13.33 $ 12.66 $ 12.16 $ 11.72
Voting Dilution 10.77% 10.78% 10.78% 10.74%
- --------------------------------------------------------------------------------------------------------------
Page 8