EXHIBIT 99
CITIZENS FIRST SAVINGS BANK 401(k) PLAN
AUDITED FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULES
CITIZENS FIRST SAVINGS BANK
401(k) PLAN
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FINANCIAL REPORT
WITH ADDITIONAL INFORMATION
DECEMBER 31, 2002
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CITIZENS FIRST SAVINGS BANK 401(k) PLAN
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CONTENTS
REPORT LETTER 1
STATEMENT OF NET ASSETS AVAILABLE FOR PLAN BENEFITS 2
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS 3
NOTES TO FINANCIAL STATEMENTS 4-6
SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES Schedule 1
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Independent Auditor's Report
To the Board of Trustees
Citizens First Savings Bank
401(k) Plan
We have audited the accompanying statements of net assets available for Plan
benefits of the Citizens First Savings Bank 401(k) Plan (the "Plan") as of
December 31, 2002 and 2001 and the related statement of changes in net assets
available for Plan benefits for the years then ended. These financial statements
are the responsibility of the Plan's management. Our responsibility is to
express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audits to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for Plan benefits of Citizens
First Savings Bank 401(k) Plan as of December 31, 2002 and 2001 and the changes
in net assets available for Plan benefits for the years then ended, in
conformity with accounting principles generally accepted in the United States of
America.
Our audits were performed for the purpose of forming an opinion on the financial
statements taken as a whole. The supplemental schedule of assets held for
investment purposes is presented for the purpose of additional analysis and is
not a required part of the basic financial statements but is supplementary
information required by the Department of Labor's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement
Income Security Act of 1974. The supplemental schedule is the responsibility of
the Plan's management. The supplemental schedule has been subjected to the
auditing procedures applied in the audit of the basic financial statements and,
in our opinion, is fairly stated in all material respects in relation to the
basic financial statements taken as a whole.
/s/ Plante & Moran, PLLC
Auburn Hills, Michigan
September 24, 2003
CITIZENS FIRST SAVINGS BANK 401(k) PLAN
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STATEMENT OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
December 31
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2002 2001
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ASSETS
Cash $ 35,326 $ 60,776
Participant-directed investments - At fair value:
Mutual funds 1,039,020 908,163
Employer common stock 2,045,432 1,257,900
Participant loans 47,406 24,027
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Total participant-directed investments 3,131,858 2,190,090
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NET ASSETS AVAILABLE FOR PLAN BENEFITS $3,167,184 $2,250,866
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2
See Notes to Financial Statements.
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CITIZENS FIRST SAVINGS BANK 401(k) PLAN
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STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
Year Ended December 31
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2002 2001
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ADDITIONS TO NET ASSETS
Investment income (loss):
Net realized and unrealized gain (loss) from
investments in:
Mutual funds $ (72,208) $ (69,180)
Employer common stock 423,585 372,755
Interest and dividends 34,116 7,000
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Total investment income 385,493 310,575
Contributions:
Participants 405,213 288,467
Employer 102,765 79,355
Rollover 80,178 14,342
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Total contributions 588,156 382,164
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Total additions - Net of investment loss 973,649 692,739
DEDUCTIONS - Benefits paid to participants 57,331 21,520
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3
See Notes to Financial Statements.
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CITIZENS FIRST SAVINGS BANK 401(k) PLAN
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NET INCREASE IN NET ASSETS AVAILABLE FOR PLAN BENEFITS 916,318 671,219
NET ASSETS AVAILABLE FOR PLAN BENEFITS
Beginning of year 2,250,866 1,579,647
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End of year $ 167,184 $2,250,866
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4
See Notes to Financial Statements.
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CITIZENS FIRST SAVINGS BANK 401(k) PLAN
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NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2002 AND 2001
NOTE 1 - DESCRIPTION OF THE PLAN
The Citizens First Savings Bank 401(k) Plan (the "Plan") is a defined
contribution plan for eligible employees of Citizens First Savings Bank
(the "Employer"). The following brief description of the Plan is
provided for general information purposes only. Participants should
refer to Plan Document for more complete information.
PARTICIPATION AND VESTING - All employees are eligible to participate
in the Plan once they have attained the age of 18. Participant
contributions are always fully vested and nonforfeitable. Annually, the
Employer will make an Employer-matching contribution. Each participant
who has worked more than 500 hours during the calendar year or is
employed on the last day of the Plan year shall be entitled to a
portion of the Employer contributions. In addition, participants who
have retired or died during the Plan year will be entitled to a share
of the Employer contributions. The Employer's contributions vest under
the following schedule:
Years of Percentage
Service Vested
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Less than 3 years 0
3 years 100
FORFEITURES - Annually forfeitures may be used to reinstate previously
forfeited accounts, if any, correct erroneously omitted employees, if
any, or reduce Plan expenses. Any remaining amounts shall be used to
reduce Employer contributions.
EMPLOYEE CONTRIBUTIONS - Contributions to participants' accounts are
made through voluntary reductions in their compensation. Such
5
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CITIZENES FIRST SAVINGS BANK 401(k) PLAN
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NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2002 AND 2001
reductions are, in turn, paid to the Plan by the Employer. Participants
may contribute from 1 percent to 15 percent of pretax compensation,
less bonuses and overtime, to the Plan each calendar year. Annual
contributions for each participant are subject to limitations as
defined in the Internal Revenue Code.
EMPLOYER CONTRIBUTIONS - The Plan provides for an Employer-matching
contribution. The Employer match for 2002 and 2001 was 50 percent of
each participant's deferral, limited to the first 4 percent of each
participant's annual compensation.
PARTICIPANT ACCOUNTS - Each participant's account is credited with the
participant and Employer contributions and an allocation of any Plan
earnings. Contributions to the Plan are allocated to participants'
individual accounts on the date of receipt by the trustee. Allocations
are based on participant elections. The benefit to which a participant
is entitled is the amount included in each individual's vested
participant account.
NOTE 1 - DESCRIPTION OF THE PLAN (CONTINUED)
DISTRIBUTIONS - Participants or their beneficiaries may receive
distributions of their account balances upon the earlier of reaching
age 59 1/2, death, hardship, withdrawal, or termination of service, as
defined in the Plan. Such distributions are made in a lump sum.
Mandatory distributions must begin no later than April 1 following the
year in which the participant reaches the age of 70 1/2. The Plan
should be consulted for further details regarding the benefit
provisions.
LOANS - The Plan allows participants to borrow money from the Plan
limited to the lesser of $50,000 or one-half of the participants'
vested account balance. Loans must have terms no longer than five
years, with the exception of loans used to acquire, construct, or
6
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CITIZENES FIRST SAVINGS BANK 401(k) PLAN
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NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2002 AND 2001
reconstruct the participant's home, and must bear a reasonable interest
rate as determined by the Plan administrator.
PLAN TERMINATION - Although the Employer intends to continue the Plan
indefinitely, it has reserved the right to amend or terminate the Plan
at any time. If the Plan were to be terminated, the amount in each
participant's account would become fully vested as of the date of
termination of the Plan. Plan funds would be distributed to each
participant in accordance with distribution policies set forth in the
Plan.
ADMINISTRATIVE EXPENSES - Administrative expenses of the Plan are paid
by the Employer.
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES
ASSETS AND LIABILITIES - Accounting policies relative to the basis of
recording assets and liabilities conform with Department of Labor
guidelines. Assets and liabilities are presented at fair value. The
fair value of investments in mutual funds and common stock is based on
quoted market prices. The value of participant loans is the face value
of the loans outstanding, which approximates market.
CHANGES IN NET ASSETS - Income is recorded as earned. Expenses are
recorded when incurred. Since assets of the Plan are recorded at fair
value, unrealized appreciation or depreciation of Plan assets for the
year is recorded in the statement of changes in net assets available
for Plan benefits. Contributions are recorded on the accrual basis in
the Plan year to which the contribution applies. Distributions to
beneficiaries are recorded when distributed by the Plan.
7
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CITIZENES FIRST SAVINGS BANK 401(k) PLAN
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NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2002 AND 2001
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
USE OF ESTIMATES - The preparation of financial statements in
conformity with accounting principles generally accepted in the United
States of America requires Plan management to make estimates and
assumptions that affect the reported amounts of assets and liabilities
and disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of additions and
deductions during the reporting period. Actual results could differ
from those estimates.
NOTE 3 - INCOME TAX STATUS
The Plan was amended on September 26, 2002 and restated. The Internal
Revenue Service issued a determination letter dated June 16, 2003
stating that the restated Plan qualifies under Section 401(a) of the
Internal Revenue Code and that the related trust is, therefore, not
subject to tax under present income tax laws.
NOTE 4 - RELATED PARTY TRANSACTIONS
Participants have the option of investing in common stock of the
Employer.
NOTE 5 - INVESTMENTS
The Plan's investments are held by Citizens First Savings Bank. The
fair value of individual investments that exceed 5 percent of the
Plan's beginning net assets is as follows:
2002 2001
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Mutual funds:
Federated Capital Preservation Fund $228,567 $210,751
Federated Mid Cap Fund 261,610 241,429
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CITIZENS FIRST SAVINGS BANK 401(k) PLAN
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NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2002 AND 2001
Federated Total Return Bond Fund 149,806 119,203
Federated Max Cap Fund 154,023 146,585
Common stock - Citizens First Bancorp, Inc. -
Employer common stock 2,045,432 1,257,900
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CITIZENS FIRST SAVINGS BANK 401(k) PLAN
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SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
FORM 5500, SCHEDULE H, ITEM 4I
EIN 38-0421485, PLAN 001
DECEMBER 31, 2002
(a) (b) (c) (d) (e)
Identity of Issuer Description Cost Current Value
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Mutual funds:
Federated Investors, Inc. Federated Capital Preservation Fund * $ 228,567
Federated Investors, Inc. Federated Total Return Bond Fund * 149,806
Federated Investors, Inc. Federated Kaufmann Fund * 19,932
Federated Investors, Inc. Federated Max Cap Fund * 154,023
Federated Investors, Inc. Federated Managed Income Fund * 13,024
Federated Investors, Inc. Federated Managed Conservative Fund * 11,123
Federated Investors, Inc. Federated Managed Moderate Growth Fund * 31,485
Federated Investors, Inc. Federated Managed Growth Fund * 6,757
Federated Investors, Inc. Federated Mid Cap Fund * 261,610
Goldman Sachs Goldman Sachs Core U.S. Equity Fund * 23,410
Janus Janus Advisor Balanced Fund * 59,189
Janus Janus Advisor Worldwide Fund * 34,432
AIM AIM Aggressive Growth Fund * 45,662
Citizens First Bancorp, Inc. Common stock - Citizens First Bancorp, Inc. * 2,045,432
Participants Participant loans, with interest ranging from
6.25 percent to 11.5 percent - 47,406
Total investments $ 3,131,858
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* Cost information not required
* Cost information not required
Page 1
Schedule 1
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