MAF Bancorp to purchase St. Francis Capital Corp. for 1.77 times revenue

Weekly Corporate Growth Report, May 26, 2003

The Deal: MAF Bancorp has agreed to acquire St. Francis Capital Corporation in an all-stock deal valued at approximately $264 million. Under the terms of the agreement, each outstanding share of St. Francis will be converted into 0.79 MAF common shares. Based on recent closing prices, this conversion rate values St. Francis stock at $26.57 per share. The deal has been approved by the boards of both companies but still requires approval from the Office of Thrift Supervision, the FDIC, and the shareholders of both companies.

Discussion: St. Francis Capital is the holding company for St. Francis Bank. The bank is a thrift that serves the Milwaukee area through some two dozen branches and three loan offices. The thrift's loan portfolio consists primarily of real estate loans. Subsidiaries of St. Francis Bank develop, own, and operate affordable multifamily housing and sell life and disability insurance and annuities.

MAF Bancorp is the parent company of Mid America Bank. The bank operates about 35 branches in Chicago and its western suburbs. In addition to traditional banking services, MAF provides residential real estate development, insurance sales, and investment and brokerage services.

After the acquisition, MAF will have total assets of more than $9 billion and a market capitalization of about $1.1 billion. MAF expects the acquisition to add about 29 cents per share to its 2004 earnings.