U.S. Securities and Exchange Commission


                             WASHINGTON, D.C. 20549

                                  FORM 10QSB/A
                                Amendment No. 1

              [X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                  For the quarterly period ended March 31, 1998

[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

   For the transition period from ____________________ to ____________________ 

                         Commission file number 0-22288

                             Fidelity Bancorp, Inc.
                             ---------------------- 
        (Exact name of small business issuer as specified in its charter)

  Pennsylvania                                          25-1705405  
  ------------                                          ---------- 
 (State  or  other  jurisdiction  of          (IRS Employer Identification No.)
 incorporation  or organization
 
               1009 Perry Highway, Pittsburgh, Pennsylvania 15237
              --------------------------------------------------- 
              (Address of principal executive offices) (Zip code)

                                  412-367-3300
                                  ------------ 
                           (Issuer's telephone number) 

--------------------------------------------------------------------------------
Former name, former address and former fiscal year, if changed since last report

Check  whether the issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the  Exchange  Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports),  and (2) has been
subject to such filing requirements for the past 90 days. Yes [ X ]  No [   ]

                APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
                   PROCEEDINGS DURING THE PRECEDING FIVE YEARS


Check whether the  registrant  filed all  documents  and reports  required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the  distribution  of
securities under a plan confirmed by a court. Yes [ X ]  No [   ]

                      APPLICABLE ONLY TO CORPORATE ISSUERS

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date: 1,968,002 shares, par value $0.01, at
April 30, 1998

Transitional Small Business Disclosure Format (Check one): Yes [ ] No [ X ]
<PAGE>
                     FIDELITY BANCORP, INC. AND SUBSIDIARIES

                                      Index


Part I - Financial Information
 

Item 1.  Financial Statements

          Statements of Financial Condition as of September 30, 1997
               and March 31, 1998 (Unaudited)                                   

          Statements of Income (Unaudited) for the Three and Six Month Periods
               Ended March 31, 1997 and 1998                                    

          Statements of Cash Flows (Unaudited) for the Six Months Ended
               March 31, 1997 and 1998
        
          Statement of Changes in Stockholders' Equity (Unaudited) for the Six
               Months Ended March 31, 1997 and 1998                             

          Notes to Financial Statements                                         

Item 2.  Management's Discussion and Analysis of Financial Condition and
             Results of Operations


Part II - Other Information

Item 1.  Legal Proceedings                                                      

Item 2.  Changes in Securities                                                  

Item 3.  Defaults Upon Senior Securities                                        

Item 4.  Submission of Matters to a Vote of Security Holders                    

Item 5.  Other Information                                                      

Item 6.  Exhibits and Reports on Form 8-K                                       

Signatures
<PAGE>
Part I - Financial Information
<TABLE>
<CAPTION>
                     FIDELITY BANCORP, INC. AND SUBSIDIARIES
                        Statements of Financial Condition

                                 (in thousands)

                                                           March 31,  September 30,
                                                             1998         1997
                                                           --------     --------
                                                          (Unaudited)
                    Assets
<S>                                                        <C>          <C>
Cash and amounts due from
   depository institutions ...........................     $  4,054     $  3,731
Interest-earning demand deposits with
   other institutions ................................          232          243
Investment securities held-to-maturity ...............       11,411        8,541
Investment securities available-for-sale .............       46,605       44,573
Loans receivable, net  (Notes 6 and 7) ...............      199,028      182,869
Mortgage-backed securities, held-to-maturity .........       28,122       34,065
Mortgage-backed securities available-for-sale ........       96,259       93,851
Real estate owned, net ...............................           21         --
Federal Home Loan Bank stock - at cost ...............        4,925        4,885
Accrued interest receivable, net:
   Loans .............................................        1,021          932
   Mortgage-backed securities ........................          747          759
   Investments .......................................          783          724
Office premises and equipment, net ...................        3,394        3,467
Deferred tax asset ...................................        1,032          852
Prepaid expenses and sundry assets ...................        5,285        1,472
                                                           --------     --------
       Total Assets ..................................     $402,919     $380,964
                                                           ========     ========

                   Liabilities and Net worth
Liabilities:
   Savings deposits ..................................     $263,006     $244,192
   Federal Home Loan Bank advances ...................       96,100       96,700
   Reverse repurchase agreements .....................        1,758        1,183
   Advance deposits by borrowers for
      taxes and insurance ............................        2,112        1,097
   Accrued interest on savings and
      other deposits .................................           53          159
   Accrued interest on trust preferred securities ....          211          211
   Accrued income taxes payable ......................          520          204
   Other accrued expenses and sundry liabilities .....        1,356        1,087
   Guaranteed preferred beneficial interest in
       Company's debentures (Note 8) .................       10,250       10,250
                                                           --------     --------
       Total Liabilities .............................      375,366      355,083
                                                           --------     --------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
                     FIDELITY BANCORP, INC. AND SUBSIDIARIES
                    Statements of Financial Condition (Cont'd)

                                 (in thousands)    

                                                           March 31,  September 30,
                                                             1998         1997
                                                           --------     --------
                                                          (Unaudited)
                     
<S>                                                        <C>          <C>
Stockholders' equity (Notes 4 and 5):
   Common Stock, $0.01 par value per share,
      10,000,000 shares authorized; 1,966,015
      and 1,943,469 shares issued and outstanding,
      respectively ...................................           20           15
   Additional paid-in capital ........................       13,965       13,811
   Retained earnings - substantially restricted ......       12,869       11,822
   Unrealized gain (loss) on securities
      available-for-sale .............................          699          233
                                                           --------     --------
       Total Stockholders' Equity ....................       27,553       25,881
                                                           --------     --------
       Total Liabilities and Stockholders' Equity ....     $402,919     $380,964
                                                           ========     ========
</TABLE>
See accompanying notes to financial statements.
<PAGE>
<TABLE>
<CAPTION>
                            FIDELITY BANCORP, INC. AND SUBSIDIARIES
                                Statements of Income (Unaudited)

                                        (in thousands)



                                                   Three Months Ended         Six Months Ended
                                                         March 31,                March 31,
                                                 ---------------------     -------------------                      
                                                     1998         1997        1998        1997
                                                  -------      -------     -------     -------
<S>                                               <C>          <C>         <C>         <C> 
Interest income:
   Loans ....................................     $ 3,960      $ 3,211     $ 7,944     $ 6,397
   Mortgage-backed securities ...............       1,952        1,612       4,037       3,167
   Investment securities:
       Taxable ..............................         636          609       1,311       1,200
       Tax-exempt ...........................         278          246         528         514
   Deposits with other institutions .........          29            2          33           5
                                                  -------      -------     -------     -------
      Total interest income .................       6,855        5,680      13,852      11,283
                                                  -------      -------     -------     -------
                                                                                        
Interest expense:
   Savings deposits .........................       2,724        2,310       5,395       4,673
   Guaranteed preferred beneficial interest
      in subordinated debt (Note 8) .........         256         --           512        --
   Borrowed funds ...........................       1,321          884       2,706       1,673
                                                  -------      -------     -------     -------
      Total interest expense ................       4,301        3,194       8,613       6,346
                                                  -------      -------     -------     -------

Net interest income before provision
   for loan losses ..........................       2,554        2,486       5,239       4,937
Provision for loan losses ...................         110          120         225         235
                                                  -------      -------     -------     -------

Net interest income after provision
   for loan losses ..........................       2,444        2,366       5,014       4,702
                                                  -------      -------     -------     -------

Other income:
   Service fee income .......................          30           17          64          36
   Gain (loss) on sale of investment
      and mortgage-backed
      securities, net .......................          (1)          22           8          20
   Gain on sale of loans ....................           7            3           9           5
   Other operating income ...................         271          182         444         347
                                                  -------      -------     -------     -------
      Total other income ....................         307          224         525         408
                                                  -------      -------     -------     -------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
                            FIDELITY BANCORP, INC. AND SUBSIDIARIES
                            Statements of Income (Unaudited) (Cont'd)

                                       (in thousands)

                                           
                                                   Three Months Ended         Six Months Ended
                                                         March 31,                March 31,
                                                 ---------------------     -------------------                      
                                                     1998         1997        1998        1997
                                                  -------      -------     -------     -------
<S>                                               <C>          <C>         <C>         <C>                                 
Operating expenses:
   Compensation and employee benefits .......       1,003          853       2,047       1,763
   Occupancy and equipment expense ..........         161          144         299         289
   Depreciation and amortization ............         127          123         250         235
   Federal insurance premiums ...............          38           38          76          38
   Loss on real estate owned, net ...........           1           26          10          33
   Amortization of intangibles ..............        --           --          --            44
   Other operating expenses .................         421          383         830         755
                                                  -------      -------     -------     -------
      Total operating expenses ..............       1,751        1,567       3,512       3,157
                                                  -------      -------     -------     -------

Income before income tax provision ..........       1,000        1,023       2,027       1,953

Income tax provision ........................         335          385         694         693
                                                  -------      -------     -------     -------

Net income ..................................     $   665      $   638     $ 1,333     $ 1,260
                                                  =======      =======     =======     =======

Basic earnings per common share (Notes 3&4) .     $  0.34      $  0.33     $  0.68     $  0.66
                                                  =======      =======     =======     =======

Diluted earnings per common share (Notes 3&4)     $  0.33      $  0.32     $  0.65     $  0.64
                                                  =======      =======     =======     =======

Dividends per common share (Note 4) .........     $  .072      $ 0.066     $  .144     $  .124
                                                  =======      =======     =======     =======

</TABLE>
See accompanying notes to financial statements.
<PAGE>
<TABLE>
<CAPTION>
                                   FIDELITY BANCORP, INC. AND SUBSIDIARIES
                                     Statements of Cash Flows (Unaudited)

                                             (in thousands)

                                                                                Six Months Ended March 31,
                                                                              ------------------------------
                                                                                   1998              1997
                                                                              ------------      ------------
<S>                                                                           <C>               <C>
Operating Activities:
     Net income .........................................................     $  1,333      $  1,260 
     Adjustments to reconcile net income to net
     cash provided by operating activities:
         Provision for loan losses ......................................          225           235 
         Loss on real estate owned ......................................           10            33
         Depreciation and amortization ..................................          250           235 
         Deferred loan fee amortization .................................          (66)          (97)
         Amortization of investment and mortgage-backed securities
          discounts/premiums, net .......................................          205           159
         Amortization of intangibles ....................................           --            44 
         Net (gain) loss on sale of investment securities ...............           (6)          (10)
         Net (gain) loss on sale of mortgage-backed securities ..........           (3)          (10)
         Net (gain) loss  on sale of loans ..............................           (9)           (5)
         Origination of loans held-for-sale .............................          (68)         (320)
         Proceeds from sale of loans held-for-sale ......................           68           324 
         (Increase) decrease in interest receivable .....................         (136)           44
         (Increase) decrease in deferred tax asset ......................         (180)         (275)
         Increase (decrease) in accrued income taxes ....................          316           662
         Increase (decrease) in interest payable ........................         (107)         (109)
         SAIF assessment ................................................           --        (1,530)
         Other changes, net .............................................         (946)         (356)
                                                                              --------      -------- 

        Net cash provided (used) by operating activities ................          886           284 
                                                                             
Investing Activities:
     Proceeds from sales of investment securities available-for-sale ....        8,001         7,774
     Proceeds from maturities and principal repayments of
        investment securities available-for-sale ........................        2,005         2,000 
     Purchases of investment securities available-for-sale ..............      (11,764)       (4,251)
     Proceeds from sales of mortgage-backed securities available-for-sale       14,042         4,158
     Proceeds from maturities and principal repayments of  mortgage-
        backed securities available-for-sale ............................        8,066         3,358 
     Purchases of mortgage-backed securities available-for-sale .........      (24,192)      (19,684)
     Proceeds from maturities and principal repayments of investment
        securities held-to-maturity .....................................        5,129         1,242 
     Purchases of investment securities held-to-maturity ................       (7,997)       (1,000)
     Purchases of mortgage-backed securities held-to-maturity ...........           --        (2,008)
     Proceeds from principal repayments of mortgage-backed
       securities held-to-maturity ......................................        5,845         2,808 
     Principal repayments on first mortgage loans .......................        8,528         8,098 
     Principal repayments on other loans ................................       14,168         8,879
     First mortgage loans originated and disbursed ......................      (22,087)      (10,405)
     Other loans originated .............................................      (20,035)      (11,676)
     Proceeds from sale of other loans ..................................          269           197 
     Additions to office premises and equipment .........................         (195)         (381)
  Net purchases of FHLB Stock ...........................................          (40)         (529)
                                                                              --------      -------- 

  Net cash provided (used) by investing activities ......................      (20,257)      (11,420)
                                                                              --------      -------- 
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
                                   FIDELITY BANCORP, INC. AND SUBSIDIARIES
                                Statements of Cash Flows (Unaudited) (Cont'd)

                                              (in thousands)



                                                                             Six Months Ended March 31,

                                                                                1998              1997
                                                                              --------         --------- 
<S>                                                                           <C>               <C>
Financing Activities:
Net increase (decrease) in savings deposits .............................       18,814              386
Increase in advance payments by borrowers for taxes and insurance........        1,015              622 
Increase (decrease) in reverse repurchase agreements ....................          575              138
FHLB advance repayments .................................................     (515,030)        (840,800)
FHLB advances ...........................................................      514,430          850,575
Cash dividends paid .....................................................         (281)            (236)
Stock options exercised .................................................          114              202
Proceeds from sale of stock .............................................           45               32
                                                                              --------         --------- 

Net cash provided (used) by financing activities ........................       19,682           10,919 
                                                                              --------         -------- 

Increase (decrease) in cash and cash equivalents ........................          311             (217)

Cash and cash equivalents at beginning of period ........................        3,975            4,762 
                                                                              --------         --------- 

Cash and cash equivalents at end of period ..............................     $  4,286         $  4,545
                                                                              ========         ======== 

Supplemental Disclosure of Cash Flow Information

Cash paid during the period for:
  Interest on deposits and other borrowings .............................     $   8,575       $   6,316
  Income taxes ..........................................................     $     785       $      28
                                                                              ---------       --------- 
Transfer of investment and mortgage-backed securities from
  investment to available-for-sale ......................................     $       0      $        0
                                                                              ---------      ---------- 

</TABLE>
See accompanying notes to financial statements.
<PAGE>
<TABLE>
<CAPTION>
                                               FIDELITY BANCORP, INC. AND SUBSIDIARIES
                                            Statement of Changes in Stockholders' Equity

                                                           (in thousands)




                                                                   Additional                      Unrealized Gain/
                                                Common              Paid-in          Retained    (Loss) on Securities
                                                 Stock              Capital          Earnings     Available-for-Sale       Total
                                              ------------       ------------      ------------     ------------      ------------
<S>                                           <C>                <C>               <C>              <C>                <C>     
Balance at September 30, 1996 ...........     $        14         $    10,437      $ 12,523         $ (1,196)           $21,778
    Net income ..........................                                             1,260                               1,260
    Cash dividends paid at
    $.08 per share ......................                                              (236)                               (236)
    Net change in unrealized gain
          (loss) on securities available-
          for-sale, net of taxes ........                                                               (213)              (213)
     Sale of stock ......................                                  32                                                32
     Stock options exercised ............                                 202                                               202
                                              -----------         -----------      --------         --------            -------
Balance at March 31, 1997 ...............     $        14            $ 10,671      $ 13,547         $ (1,409)          $ 22,823
                                              -----------         -----------      --------         --------            -------


Balance at September 30, 1997 ...........     $        16           $  13,810      $ 11,822         $     233          $ 25,881
    Net income ..........................                                             1,332                               1,332
    Cash dividends paid at
    $.09 per share ......................                                              (281)                               (281)
    5/4 Stock Split .....................               4               (4)                                                   0
    Cash paid on stock split in lieu of
          fractional shares .............                                                (4)                                 (4)
    Net change in unrealized gain
          (loss) on securities available-
          for-sale, net of taxes ........                                                                 466               466
     Sale of stock ......................                              114                                                  114
     Stock options exercised ............                               45                                                   45
                                              -----------         -----------      --------         --------            -------
Balance at March 31, 1998 ...............     $        20      $    13,965          $ 12,869            $ 699           $27,553 
                                              -----------         -----------      --------         --------            -------


</TABLE>
<PAGE>
                     FIDELITY BANCORP, INC. AND SUBSIDIARIES

                          Notes to Financial Statements
                                   (Unaudited)

                      September 30, 1997 and March 31, 1998


(1) Consolidation

The audited and unaudited consolidated financial statements contained herein for
Fidelity Bancorp, Inc. (the "Company") include the accounts of Fidelity Bancorp,
Inc. and its wholly-owned subsidiaries,  Fidelity Bank, PaSB (the "Bank") and FB
Capital  Trust  (the  "Trust").  All  significant   inter-company  balances  and
transactions have been eliminated.

(2) Basis of Presentation

The accompanying  consolidated  financial statements were prepared in accordance
with instructions to Form 10-QSB, and therefore,  do not include  information or
footnotes necessary for a complete  presentation of financial position,  results
of operations and cash flows in conformity  with generally  accepted  accounting
principles.  However, all normal recurring  adjustments which, in the opinion of
management,  are necessary for a fair presentation of the financial  statements,
have been included.  These  financial  statements  should be read in conjunction
with  the  audited  financial  statements  and the  accompanying  notes  thereto
included in the Company's Annual Report for the period ended September 30, 1997.
The  results  for the three and six month  periods  ended March 31, 1998 are not
necessarily  indicative  of the results that may be expected for the fiscal year
ending September 30, 1998.

(3) Earnings Per Share

In February 1997, the Financial  Accounting  Standards Board ("FASB") issued FAS
No. 128, "Earnings per Share". FAS No. 128 provides revised reporting  standards
for earnings per share ("EPS") and is effective for financial  statement periods
ending after December 15, 1997. FAS No. 128 eliminates primary and fully diluted
EPS  disclosures  and adds new  disclosures  of basic and diluted EPS. Basic EPS
excludes  dilution  and is  computed  by  dividing  income  available  to common
stockholders by the weighted average number of common shares outstanding for the
period.  Diluted  EPS  reflects  the  potential  dilution  that  could  occur if
securities or other  contracts to issue common stock were exercised or converted
into common  stock or resulted in the  issuance of common stock that then shared
in the earnings of the Company.  The Company  adopted FAS No. 128 as of December
31, 1997 and all prior period per share amounts have been restated.
<PAGE>
The following table sets forth the computation of basic and diluted earnings per
share (amounts in thousands, except per share data):
<TABLE>
<CAPTION>

                                         Three Months Ended      Six Months Ended
                                              March 31,              March 31,
Numerator:                                 1998       1997       1998       1997
                                         ------     ------     ------     ------
<S>                                      <C>        <C>        <C>        <C>
Net income .........................     $  665     $  638     $1,333     $1,260
                                         ------     ------     ------     ------

   Numerator for basic and
    diluted earnings per share .....     $  665     $  638     $1,333     $1,260
                                         ------     ------     ------     ------

Denominator:

Denominator for basic earnings
   per share - weighted average
   shares ..........................      1,959      1,912      1,953      1,903

Effect of dilutive securities:
   Employee stock options ..........         86         61         86         61
                                         ------     ------     ------     ------

Denominator for diluted earnings
   per share - weighted average
   shares and assumed conversions ..      2,045      1,973      2,039      1,964
                                         ======     ======     ======     ======

Basic earnings per share ...........     $  .34     $  .33     $  .68     $  .66
                                         ======     ======     ======     ======

Diluted earnings per share .........     $  .32     $  .32     $  .65     $  .64
                                         ======     ======     ======     ======

</TABLE>

(4) Per share amounts have been restated to give  retroactive  effect to the 10%
common stock dividend  declared by the Company's  Board of Directors and paid on
May 28, 1997, and the five for four stock split paid on March 31, 1998.

(5) Securities

The Company accounts for investments in debt and equity securities in accordance
with FAS No. 115, which requires that  investments be classified as either:  (1)
Securities   Held-to-  Maturity  -  reported  at  amortized  cost,  (2)  Trading
Securities  - reported at fair value,  or (3)  Securities  Available-for-Sale  -
reported at fair value.  Unrealized gains and losses for trading  securities are
reported  in  earnings  while   unrealized   gains  and  losses  for  securities
available-for-sale  are reported as a separate  component of equity.  Unrealized
gains of $699,000,  net of tax, on investments  classified as available-for-sale
are recorded as a separate component of equity at March 31, 1998.
<PAGE>
(6) Loans Receivable

         Loans  receivable  are  comprised of the following  (dollar  amounts in
thousands):
<TABLE>
<CAPTION>
                                                       March 31,      September 30,
                                                         1998             1997
                                                       ---------      ---------
<S>                                                    <C>            <C>
       First mortgage loans:
                Conventional:
                         1-4 family dwellings ....     $ 106,309      $  97,698
                         Multi-family dwellings ..         4,123          4,165
                Commercial .......................        23,093         19,976
                Construction .....................         9,856          7,614
                                                       ---------      ---------
                                                         143,381        129,453
                                                       ---------      ---------
       Less:
                Loans in process .................        (6,365)        (3,695)
                Unearned discounts and fees ......        (1,003)          (912)
                                                       ---------      ---------
                                                         136,013        124,846
                                                       ---------      ---------
       Installment loans:
                Home equity ......................        39,552         37,271
                Mobile home loans ................            41             68
                Consumer loans ...................         2,383          2,579
                Other ............................         4,056          3,163
                                                       ---------      ---------
                                                          46,032         43,081
                                                       ---------      ---------
Commercial loans:

                Commercial business loans ........        17,336         16,325
                Lease loans ......................         1,761            548
                                                       ---------      ---------
                                                          19,097         16,873
                                                       ---------      ---------
       Less: Allowance for possible loan losses ..        (2,114)        (1,931)
                                                       ---------      ---------

                Loans receivable, net ............     $ 199,028      $ 182,869
                                                       =========      =========
</TABLE>
<PAGE>
(7) Changes in the  allowance for loan losses for the six months ended March 31,
1998 and 1997 are as follows (dollar amounts in thousands):
<TABLE>
<CAPTION>
                                                          1998            1997
                                                        -------         -------
<S>                                                     <C>             <C>
Balance at beginning of the fiscal year ........        $ 1,931         $ 1,530
Provision for loan losses ......................            225             235
Charge-offs ....................................            (46)           (105)
Recoveries .....................................              4              17
                                                        -------         -------

Balance at March 31, ...........................        $ 2,114         $ 1,677
                                                        =======         =======
</TABLE>

The  provision  for loan  losses  charged to expense is based upon past loan and
loss  experience  and an  evaluation  of  potential  losses in the current  loan
portfolio,  including the  evaluation  of impaired  loans under FAS Nos. 114 and
118. A loan is considered to be impaired  when,  based upon current  information
and events,  it is probable  that the Bank will be unable to collect all amounts
due according to the contractual  terms of the loan. An insignificant  shortfall
in payments does not necessarily  result in a loan being identified as impaired.
For this purpose, delays less than 90 days are considered to be insignificant.

Impairment  losses are included in the provision  for loan losses.  FAS Nos. 114
and 118 do not apply to large groups of smaller balance,  homogeneous loans that
are collectively  evaluated for impairment,  except for those loans restructured
under a troubled debt restructuring. Loans collectively evaluated for impairment
include  consumer loans and residential  real estate loans, and are not included
in the following data.

At March 31, 1998,  there are no loans that are  considered to be impaired under
FAS No. 114. The average  recorded  investment in impaired  loans during the six
months ended March 31, 1998,  was zero. For the six months ended March 31, 1998,
the Company  recognized no interest  income on those impaired  loans,  using the
cash basis of income recognition.

(8) On May 13,  1997,  the Trust,  a  statutory  business  trust  created  under
Delaware law that is a subsidiary of the Company,  issued $10.25 million,  9.75%
Preferred   Securities   ("Preferred   Securities")  with  a  stated  value  and
liquidation  preference  of $10 per share.  The  Trust's  obligations  under the
Preferred  Securities  issued are fully and  unconditionally  guaranteed  by the
Company.  The proceeds  from the sale of the  Preferred  Securities of the Trust
were  utilized  by the  Trust to  invest  in  $10.25  million  of  9.75%  Junior
Subordinated  Debentures (the  "Debentures") of the Company.  The Debentures are
unsecured  and  rank   subordinate  and  junior  in  right  of  payment  to  all
indebtedness,  liabilities  and  obligations  of  the  Company.  The  Debentures
represent the sole assets of the Trust.  Interest on the Preferred Securities is
cumulative  and  payable  quarterly  in  arrears.  The  Company has the right to
optionally redeem the Debentures prior to the maturity date of July 15, 2027, on
or after July 15, 2002, at 100% of the stated liquidation  amount,  plus accrued
and unpaid  distributions,  if any, to the redemption date. Under the occurrence
of  certain  events,  the  Company  may  redeem in whole,  but not in part,  the
Debentures  prior  to  July  15,  2002.  Proceeds  from  any  redemption  of the
Debentures  would cause a mandatory  redemption of the Preferred  Securities and
the  common  securities  having an  aggregate  liquidation  amount  equal to the
principal amount of the Debentures redeemed.
<PAGE>
On July 17, 1997, on behalf of the Trust, the Company  requested relief from the
Office of Chief Counsel of the Division of Corporation Finance of the Securities
and Exchange Commission,  exempting the Trust from the reporting requirements of
the Securities  Exchange Act of 1934. The Trust is a wholly-owned  subsidiary of
the Company, has no independent  operations and issued securities that contained
a full and unconditional  guarantee of its parent,  the Company.  On January 29,
1998, the Company received  notification  from the Division  exempting the Trust
from the reporting requirements.

(9) The Company has adopted a plan to address Year 2000 data processing  issues.
The plan  includes the  assessment  of all internal  systems,  programs and data
processing  applications as well as those provided to the Company by third-party
vendors.  In  addition,  a program to  ascertain  the  readiness of key customer
systems has been undertaken. The Company is utilizing both internal and external
resources  for  this  project.  A  significant  portion  of the  Company's  data
processing  software is provided by  third-party  vendors from which the Company
has received confirmation that they expect to be compliant with Year 2000 issues
on a timely  basis.  The Company is  coordinating  with  third-party  vendors to
perform testing of all significant applications.  This testing is expected to be
completed  by December 31, 1998.  The Company is also  developing a  contingency
plan that would be  implemented  should any  applications  or systems fail to be
Year 2000 compliant. However, based on representations from third-party vendors,
the Company believes all significant applications will be compliant. The Company
has not incurred  significant  expense to date and does not yet have an estimate
of the cost to address  Year 2000 issues;  however,  the Company does not expect
the costs to be material to future operations.
<PAGE>
                     FIDELITY BANCORP, INC. AND SUBSIDIARIES

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                       CONDITION AND RESULTS OF OPERATIONS

Comparison of Financial Condition at September 30, 1997 and March 31, 1998

Total assets of the Company increased $22.0 million or 5.8% to $402.9 million at
March 31, 1998 from $381.0 million at September 30, 1997. Significant changes in
individual  categories  were  increases in loans  receivable  of $16.2  million,
investment  securities  held-to-maturity of $2.0 million,  investment securities
available-for-sale     of    $2.6    million,     mortgage-backed     securities
available-for-sale of $2.4 million, and a decrease in mortgage-backed securities
held-to-maturity of $5.9 million.

Total  liabilities  of the Bank  increased  by $20.3  million  or 5.7% to $375.4
million  at March 31,  1998 from  $355.1  million at  September  30,  1997.  The
increase  primarily reflects an $18.8 million increase in savings deposits and a
$1.0 million increase in advance payments by borrowers for taxes and insurance.

Stockholders'  equity  increased  $1.7 million or 6.5% to $27.6 million at March
31, 1998,  compared to September 30, 1997. The increase  reflects net income for
the six month  period  ended  March 31,  1998 of $1.3  million,  an  increase in
unrealized  holding gains on securities  available-for-sale  of $466,000,  stock
options  exercised of $45,000 and stock  issued under the Dividend  Reinvestment
Plan of $114,000.  Partially  offsetting  these increases were common stock cash
dividends paid of $281,000.

Non-Performing Assets

The following table sets forth information  regarding non-accrual loans and real
estate  owned  by the  Bank at the  dates  indicated.  The Bank did not have any
accruing  loans  which  were 90 days or more  overdue  or any loans  which  were
classified as troubled debt restructuring during the periods presented.  (Dollar
amounts in thousands):
<TABLE>
<CAPTION>
                                                          March 31,   September 30,
                                                            1998          1997
                                                           ------        ------
<S>                                                        <C>           <C>
Non-accrual residential real
  estate loans (one-to-four-family) ................       $  124        $   94
Non-accrual construction, multi-family
  residential and commercial real estate loans .....          119           751
Non-accrual installment and
  commercial business loans ........................           57           271
                                                           ------        ------

Total non-performing loans .........................       $  300        $1,116
                                                           ======        ======
Total non-performing loans as
  a percent of net loans receivable ................          .15%          .61%
                                                           ======        ======
Total real estate owned,
  net of related reserves ..........................       $   21        $ --
                                                           ======        ======
Total non-performing loans and real estate
  owned as a percent of total assets ...............          .08%          .29%
                                                           ======        ======
</TABLE>
<PAGE>
Included  in  non-performing  loans  at  March  31,  1998  are  5  single-family
residential  real estate loans totaling  $124,000,  two  commercial  real estate
loans  totaling  $119,000,  23  installment  loans  totaling  $46,000,  and  one
commercial business loan totaling $11,000. Of the 5 non-performing single-family
residential  real  estate  loans,  the largest  amounted to $61,000.  Of the two
commercial  real estate  loans,  the largest is an $84,000  loan on a commercial
office building and the other is a $35,000 loan to a local community development
group.

The 23  installment  loans  total  $46,000  and  consist of various  secured and
unsecured consumer loans and credit card loans. The largest loan is for $7,000.

The commercial business loan for $11,000 is represents a bankruptcy situation.

At March 31, 1998,  the Bank had an allowance  for possible  loan losses of $2.1
million or 1.06% of net loans  receivable,  as compared to an  allowance of $1.9
million or 1.06% of net loans  receivable at September  30, 1997.  The allowance
for possible loan losses equals 704% of non-performing loans at March 31, 1998.

Management has evaluated these  non-performing  loans and the overall  allowance
for possible loan losses and is satisfied that the allowance for possible losses
on loans at March 31, 1998 is adequate. In that regard,  consideration was given
to the increase in the level of the allowance  from  September 30, 1997 to March
31, 1998, as well as the coverage of non-performing loans the allowance provides
at March 31, 1998.

Real estate owned at March 31, 1998  consists of one  single-family  residential
property located in Pittsburgh,  Pennsylvania  totaling $21,000. The property is
currently  for sale and  management  believes  that  the  carrying  value of the
property  at  March  31,  1998  approximates  the net  realizable  value  of the
property.  However, while management uses the best information available to make
such determinations, future adjustments may become necessary.


                       Comparison of Results of Operations
           for the Three and Six Months Ended March 31, 1998 and 1997

Net Income

Net income for the three months  ended March 31, 1998 was  $665,000  compared to
$638,000  for the same  period in 1997,  an  increase  of $27,000  or 4.2%.  The
increase  reflects  an increase in net  interest  income of $68,000 or 2.7%,  an
increase in other income of $83,000 or 36.9%,  a decrease in the  provision  for
loan losses of $10,000 or 8.3%, and a decrease in the provision for income taxes
of $50,000 or 13.1%. Partially offsetting these factors was an increase in other
operating expenses of $184,000 or 11.8%.
<PAGE>
Net income for the six months ended March 31, 1998 was $1.33 million compared to
$1.26 million for the same period in 1997,  an increase of $72,000 or 5.7%.  The
increase  reflects an increase in net  interest  income of $303,000 or 6.1%,  an
increase in other  income of  $117,000 or 28.5% and a decrease in the  provision
for loan losses of $10,000 or 4.3%.  Partially  offsetting  these factors was an
increase in other operating expenses of $356,000 or 11.3%.

Interest Rate Spread

The  Bank's   interest   rate  spread,   the   difference   between   yields  on
interest-earning  assets and the cost of funds,  decreased to 2.56% in the three
months ended March 31, 1998 from 3.08% in the same period in 1997. The following
table shows the average yields earned on the Bank's  interest-earning assets and
the  average  rates paid on its  interest-bearing  liabilities  for the  periods
indicated,   the  resulting  interest  rate  spreads,  and  the  net  yields  on
interest-earning assets.
<TABLE>
<CAPTION>
                                                            Three Months Ended March 31,
                                                                  1998        1997
                                                                  ----       -----
<S>                                                               <C>        <C>
Average yield on:
   Mortgage loans .......................................         7.74%       8.04%
   Mortgage-backed securities ...........................         6.38        6.32
   Installment loans ....................................         8.21        8.11
   Commercial business loans ............................         9.62       10.17
   Interest-earning deposits with other institutions,
     investment securities, and FHLB stock (1) ..........         6.91        7.09
                                                                  ----       -----
   Total interest-earning assets ........................         7.32        7.40
                                                                  ----       -----
Average rates paid on:
   Savings deposits .....................................         4.26        4.02
   Borrowed funds .......................................         5.94        5.41
                                                                  ----       -----
   Total interest-bearing liabilities ...................         4.76        4.32
                                                                  ----       -----
Average interest rate spread ............................         2.56%       3.08%
                                                                  ====       =====
Net yield on interest-earning assets ....................         2.80%       3.32%
                                                                  ====       =====
</TABLE>
(1) Interest income on tax free investments has been adjusted for federal income
tax purposes using a rate of 34%.
<PAGE>
The Bank's interest rate spread decreased to 2.68% in the six months ended March
31, 1998 from 3.13% in the same period in fiscal 1997. The following table shows
the average yields earned on the Bank's  interest-earning assets and the average
rates paid on its  interest-bearing  liabilities for the periods indicated,  the
resulting interest rate spreads, and the net yields on interest-earning assets.
<TABLE>
<CAPTION>
                                                               Six Months Ended March 31,
                                                                   1998       1997
                                                                  -----      -----
<S>                                                               <C>        <C>
Average yield on:
   Mortgage loans ........................................         8.00%      8.06%
   Mortgage-backed securities ............................         6.44       6.31
   Installment loans .....................................         8.32       8.23
   Commercial business loans .............................        10.12      10.15
   Interest-earning deposits with other institutions,
     investment securities, and FHLB stock (1) ...........         6.95       7.08
                                                                  -----      -----
   Total interest-earning assets .........................         7.45       7.42
                                                                  -----      -----
Average rates paid on:
   Savings deposits ......................................         4.25       4.01
   Borrowed funds ........................................         5.99       5.31
                                                                  -----      -----
   Total interest-bearing liabilities ....................         4.77       4.29
                                                                  -----      -----
Average interest rate spread .............................         2.68%      3.13%
                                                                  =====      =====
Net yield on interest-earning assets .....................         2.89%      3.33%
                                                                  =====      =====
</TABLE>


(1) Interest income on tax free investments has been adjusted for federal income
tax purposes using a rate of 34%.

Interest Income

Interest  on loans  increased  $749,000  or 23.3% to $4.0  million for the three
months ended March 31, 1998,  compared to the same period in 1997.  The increase
is  attributable to an increase in the average loan balance  outstanding  during
the 1997  period,  partially  offset by a decrease in the yield  earned on these
assets in the 1998 period as  compared  to the same period in 1997.  Interest on
loans increased $1.6 million or 24.4% to $8.0 for the six months ended March 31,
1998,  compared to the same period in fiscal 1997. The increase is  attributable
to an increase in the average loan balance  outstanding  during the 1998 period,
partially offset by a decrease in the yield earned on these assets in the fiscal
1998 period as compared to the same period in fiscal  1997.  The increase in the
average  balance of the loan  portfolio  in the  fiscal  1998  periods  reflects
management's  continued  strategy of emphasizing and increasing loans. The lower
yield  earned on the  portfolio  reflects  the lower  long  term  interest  rate
environment  that  has  existed  for much of  fiscal  1998,  as both  new  loans
originated are at lower rates and more existing  borrowers  refinance into lower
rate loans.
<PAGE>
Interest  on  mortgage-backed  securities  increased  $340,000  or 21.1% to $2.0
million and $854,000 or 27.0% to $4.0 million for the three and six months ended
March 31,  1998,  respectively,  as  compared to the same  periods in 1997.  The
increase for both the three and six month periods ended March 31, 1998, reflects
both an increase in the average balance of  mortgage-backed  securities owned in
the fiscal 1998  periods,  as compared  to fiscal  1997,  and an increase in the
average yield earned on the portfolio.

Interest on  interest-earning  deposits with other  institutions  and investment
securities  increased  $86,000 or 10.0% to $943,000  for the three month  period
ended March 31,  1998,  as compared  to the same  period in 1997.  The  increase
reflects an increase in the average balance in the portfolio,  partially  offset
by a decrease in the yield earned on these investments. For the six month period
ended  March  31,  1998,  interest  on  interest-earning   deposits  with  other
institutions  and  investment  securities  increased  $151,000  or  8.8% to $1.9
million, as compared to the same period in the prior year. The increase reflects
an increase in the average  balance of such  securities and deposits,  partially
offset by a decrease in the yield earned on these investments.

Interest Expense

Interest on savings  deposits  increased  $415,000 or 17.9% to $2.7  million and
$722,000  or 15.5% to $5.4  million  for the three and six month  periods  ended
March 31,  1998,  respectively,  as compared to the same periods in fiscal 1997.
The increase for both the three and six month periods in fiscal 1998 as compared
to fiscal 1997 reflects an increase in the average cost of deposits,  as well as
an  increase  in the  average  balance of savings  deposits  for the fiscal 1997
periods.  The  increase  in the  average  balance of savings  deposits  reflects
management's  decision to more aggressively price and pursue retail deposits and
the potential additional customer relationships that could ensue.  Additionally,
short term interest rates have remained relatively high in fiscal 1998, compared
to long term rates, thus deposit costs have increased.

Interest on borrowed funds increased  $436,000 or 49.3% to $1.3 million and $1.0
million or 61.6% to $2.7 million for the three and six month periods ended March
31, 1998,  respectively,  as compared to the same  periods in fiscal  1997.  The
increases  for both  periods in fiscal 1998 as  compared to fiscal 1997  reflect
both an increase in the average cost of borrowing  during the 1998  periods,  as
compared to 1997,  as well as an increase in the Federal Home Loan Bank ("FHLB")
advances and reverse  repurchase  agreements  outstanding during the fiscal 1998
periods. The Bank continues to rely on these wholesale funding sources in fiscal
1998 as an additional way to fund growth.

Interest on guaranteed  preferred  beneficial  interest in subordinated debt was
$256,000 and $512,000 for the three and six month  periods ended March 31, 1998.
As discussed more fully in Note 8, the Preferred  Securities  were issued in May
1997.

Net Interest Income Before Provision for Loan Losses

The Bank's net  interest  income  before  provision  for loan  losses  increased
$68,000 or 2.7% to $2.6  million,  and  $303,000 or 6.1% to $5.2 million for the
three and six month periods ended March 31, 1998,  respectively,  as compared to
the same periods in fiscal 1997.  The increase for both periods is  attributable
to an increase in earning assets partially offset by a decrease in interest rate
spread.
<PAGE>
Provision for Loan Losses

The provision for loan losses decreased  $10,000 or 8.3% to $110,000 and $10,000
or 4.3% to $225,000  for the three and six month  periods  ended March 31, 1998,
respectively,  as compared to the same periods in fiscal 1997. The provision for
both years  reflects  management's  evaluation  of the loan  portfolio,  current
economic  conditions,  and other factors as described  below.  The allowance for
possible loan losses has  increased  from $1.7 million at March 31, 1997 to $2.1
million at March 31, 1998.

A monthly  review is conducted by management to determine that the allowance for
possible loan losses is adequate to absorb estimated loan losses. In determining
the level of  allowances  for possible  loan losses,  consideration  is given to
general  economic  conditions,   the  diversification  of  the  loan  portfolio,
historical loss experience,  identified credit problems,  delinquency levels and
the  adequacy  of  collateral.  Although  management  believes  that the current
allowance  for loan losses is adequate,  future  additions to the reserve may be
necessary due to changes in economic conditions. In addition, various regulatory
agencies  review the adequacy of the  allowance for loan losses as part of their
examination  process and may require  additions to the allowance  based on their
judgment.

Other Income

Total  non-interest or other income  increased  $83,000 or 36.9% to $307,000 and
$117,000 or 28.5% to $525,000  for the three and six month  periods  ended March
31, 1998, respectively, as compared to the same periods in fiscal 1997.

Service  fee income,  which  includes  late  charges on loans and fees for loans
serviced for others,  increased  $13,000 or 79.0% to $30,000 for the three month
period ended March 31,  1998,  as compared to the same period in the prior year.
The  increase  is  primarily  attributable  to an  increase  in late  charges on
mortgages,  as well as the  imposition  of a late  charge  fee on credit  cards.
Service  fee income  increased  $28,000  or 78.6% to  $64,000  for the six month
period ended March 31, 1998, as compared to the same period in fiscal 1997.  The
increase is primarily  attributable to an increase in late charges on all loans,
the  imposition  of a late charge on credit cards,  and the  collection of a fee
related to a program  whereby  customers  could skip their  regular loan payment
over the Christmas holidays.

Loss on the sale of investment and mortgage-backed securities was $1,000 for the
three month period ended March 31, 1998, as compared to a gain of $22,000 in the
same period in 1997.  For the six month  period  ended March 31, 1998, a gain of
$8,000 was  recorded,  as  compared  to a gain of $20,000 for the same period in
fiscal 1997.  All sales were made from the  available-for-sale  portfolio in the
periods and were done to reflect current economic conditions and asset/liability
management strategies, as well as changing market conditions.

Gain on sale of loans was $7,000 and $9,000 for the three and six month  periods
ended March 31, 1998, respectively, as compared to gains of $3,000 and $5,000 in
the  comparable  periods in fiscal 1997. The Bank sells  education  loans to the
Student Loan Marketing Association ("SLMA"). Such sales generally result in some
gain or loss being realized and are being done to reduce the Bank's  position in
these loans,  which are  generally  lower  yielding and subject to extensive and
costly government  regulation.  The Bank does not intend to originate additional
student  loans for its  portfolio,  except  those that will be serviced by SLMA.
Results generally reflect the timing of such sales.
<PAGE>
Other operating  income includes  miscellaneous  sources of income which consist
primarily of various fees  related to checking  accounts,  fees from the sale of
cashiers  checks and money  orders,  and safe deposit box rental  income.  Other
operating income increased $89,000 or 48.9% to $271,000 and increased $97,000 or
27.9% to $444,000 for the three and six month  periods  ended March 31, 1998, as
compared to the same periods in fiscal 1997. The increase for both the three and
six month  periods is primarily  due to increases  in checking  account  service
charges, fees related to debit cards, increased fees on the sale of accident and
health insurance on loans, and profit on the sale of some used equipment.

Other Expenses

Total operating expenses increased $184,000 or 9.8% to $1.8 million and $356,000
or 11.3% to $3.5  million  for the three and six month  periods  ended March 31,
1998, respectively, as compared to the same period in fiscal 1997.

Compensation,  payroll  taxes and fringe  benefits,  the  largest  component  of
operating expenses,  increased $150,000 or 17.6% to $1.0 million and $284,000 or
16.1% to $2.0 million for the three and six month  periods ended March 31, 1998,
respectively,  compared to the same periods in fiscal 1997. Factors contributing
to the increase were normal salary  increases,  higher bonuses awarded in fiscal
1998,  an  increase  in the number of  employees  on the  payroll,  particularly
professionals  employed in the lending area,  and an increase in retirement  and
health care expenses.

Office occupancy and equipment  expense  increased  $17,000 or 12.0% to $161,000
and $11,000 or 3.8% to $299,000 for the three and six month  periods ended March
31, 1998, respectively, compared to the same periods in fiscal 1997. In both the
three and six month periods, increases in rent expense on the Company's new loan
center were partially offset by decreased equipment maintenance costs.

Depreciation and  amortization  increased $4,000 or 3.0% to $127,000 and $14,000
or 6.1% to $250,000  for the three and six month  periods  ended March 31, 1998,
respectively,  compared to the same periods in fiscal 1997. The results  reflect
the purchase of new computer equipment,  primarily for back room operations,  as
well as an automatic teller machine for the Washington Road branch.

Federal  insurance  premiums  were $38,000 in both the three month periods ended
March 31,  1998 and 1997.  For the six  months  ended  March 31,  1998,  federal
deposit insurance  premiums were $76,000,  compared to $38,000 in the comparable
period in fiscal 1997.  As a result of the Deposit  Insurance  Funds Act of 1996
and the resulting payment of a one-time special  assessment in 1996, the Savings
Association  Insurance Fund was fully  capitalized to the level required by law.
The FDIC then  determined  that,  for the quarter  ended  December 31, 1996,  no
deposit insurance  premiums would be due from many  institutions,  including the
Bank.  Thus there was no deposit  insurance  expense for the three  months ended
December 31, 1996. For subsequent periods, the amount of the premium is based on
the average amount of deposits  outstanding and is currently  approximately 6.22
basis points.

Net loss on real estate  owned was $1,000 for the three  months  ended March 31,
1998,  as compared to a net loss of $26,000 in the  comparable  period in fiscal
1997.  Net loss on real  estate  owned was $10,000 and $33,000 for the six month
periods  ended  March 31, 1998 and 1997,  respectively.  Results for the periods
reflect the sale of property held as real estate owned.  At March 31, 1998,  the
Bank has one single family property valued at $21,000  classified as real estate
owned.
<PAGE>
Amortization of intangibles was zero for the three month periods ended March 31,
1998 and 1997.  Amortization  of  intangibles  was zero and  $44,000 for the six
month  periods  ended March 31,  1998 and 1997,  respectively.  The  intangibles
generated by the three branch  acquisitions  that occurred in November 1991 were
being amortized on a straight-line basis over five years. These intangibles were
fully amortized in November 1996.

Other operating expenses,  which consists of check processing costs,  consulting
fees, legal and audit fees,  advertising,  bank charges and other administrative
expenses,  increased $38,000 or 9.8% to $421,000 and $75,000 or 9.9% to $830,000
for the three and six month  periods  ended  March 31,  1998,  respectively,  as
compared to the same periods in fiscal 1997. Significant variations between both
the three and six month  periods in fiscal  1998,  as compared  to fiscal  1997,
include increases in advertising,  stationary and supplies, consulting fees, and
costs  related to the  introduction  of a new  credit  card  program.  Partially
offsetting  these  increases were decreases in automatic  teller machine network
expenses and insurance premiums.

Income Taxes

Income taxes decreased  $50,000 or 13.1% to $335,000 and increased $1,000 or .1%
to  $694,000  for  the  three  and six  month  periods  ended  March  31,  1998,
respectively, compared to the same periods in fiscal 1997. The decrease in taxes
for the three month  period  ended March 31, 1998,  reflects  decreased  taxable
income in the 1998 period,  as well as a decrease in the  effective  tax rate to
33.5%,  as compared to 37.7% for the  comparable  period in the prior year.  The
increase  in taxes for the six month  period  ended  March  31,  1998,  reflects
increased taxable income in the 1998 period,  substantially offset by a decrease
in the  effective  tax rate to 34.25%,  as compared to 35.5% for the  comparable
period in the prior year.  The decreased  effective tax rate  primarily  results
from the Bank's increased purchases of tax-free investments.

Capital Requirements

The Federal Reserve Board measures capital  adequacy for bank holding  companies
on the basis of a risk-based capital framework and a leverage ratio. The minimum
ratio of total risk-based  capital to risk-weighted  assets is 8%. At least half
of the total capital must be common  stockholders'  equity (not inclusive of net
unrealized  gains and losses on  available-for-sale  securities)  and  perpetual
preferred stock, less goodwill and other nonqualifying  intangible assets ("Tier
1 capital").  The remainder (i.e. , the "Tier 2 risk-based capital") may consist
of hybrid capital  instruments,  perpetual debt, term  subordinated  debt, other
preferred stock and a limited amount of the allowance for loan losses.  At March
31, 1998, the Company had Tier 1 capital as a percentage of risk-weighted assets
of 16.9% and total risk-based capital as a percentage of risk-weighted assets of
18.5%.

In addition,  the Federal Reserve Board has established  minimum  leverage ratio
guidelines for bank holding companies.  These guidelines currently provide for a
minimum  ratio or Tier 1 capital as a  percentage  of average  total assets (the
"Leverage  Ratio") of 3% for bank holding  companies that meet certain criteria,
including  that they  maintain  the highest  regulatory  rating.  All other bank
holding  companies are required to maintain a Leverage  Ratio of at least 100 to
200 basis  points  above the  minimum.  At March 31,  1998,  the  Company  had a
Leverage Ratio of 9.0%.
<PAGE>
The FDIC has issued regulations that require insured  institutions,  such as the
Bank, to maintain  minimum levels of capital.  In general,  current  regulations
require a leverage  ratio of Tier 1 capital to average  total assets of not less
than 3% for the most highly rated  institutions  and an  additional 1% to 2% for
all other  institutions.  At March 31, 1998,  the Bank complied with the minimum
leverage  ratio  having  Tier 1 capital of 6.32% of  average  total  assets,  as
defined.

The Bank is also  required to maintain a ratio of  qualifying  total  capital to
risk-weighted  assets and  off-balance  sheet items of a minimum of 8%. At March
31, 1998,  the Bank's total  capital to  risk-weighted  assets ratio  calculated
under the FDIC capital requirement was 12.9%.

A reconciliation of Stockholders' Equity to Regulatory Capital is as follows:
<TABLE>
<CAPTION>

<S>                                                                  <C>
Stockholder's equity at March 31, 1998 (1)                           $25,149,804
Unrealized securities gains                                              516,474
                                                                     ----------- 
Tier 1 Capital at March 31, 1998                                      24,633,330
Plus: Qualifying loan loss allowance                                   2,113,644
                                                                     ----------- 
Total capital at March 31, 1998                                      $26,746,974
                                                                     ===========
</TABLE>

(1) Represents  equity  capital  of the  Bank as  reported  to the  FDIC and the
    Pennsylvania Department of Banking on Form 033.

Liquidity

The Bank's  primary  sources of funds have  historically  consisted of deposits,
amortization and prepayments of outstanding  loans,  borrowings from the FHLB of
Pittsburgh and other sources,  including  sales of securities  and, to a limited
extent,  loans.  At March 31,  1998,  the  total of  approved  loan  commitments
amounted to $4.5 million. In addition,  the Bank had $6.4 million of undisbursed
loan funds at that date. The amount of savings  certificates which mature during
the next twelve  months  totals  approximately  $113.1  million,  a  substantial
portion of which management  believes,  on the basis of prior  experience,  will
remain in the Bank.
<PAGE>


Part II - Other Information

Item. 1  Legal Proceedings
          The Bank is not involved in any pending legal  proceedings  other than
          non-material  legal  proceedings  undertaken in the ordinary course of
          business.

Item 2.  Changes in Securities
             None

Item 3.  Defaults Upon Senior Securities
             Not Applicable
   
Item 4.  Submission of Matters to a Vote of Security Holders

          A.   The Annual Meeting of Stockholders was held on February 3, 1998.

          B.   The following  item, in addition to the election of directors and
               ratification  of  auditors,  was  submitted  for  approval to the
               stockholders of Fidelity  Bancorp,  Inc. and was approved thereby
               by the requisite vote required:

          (1)       To consider  and act upon a proposal  to adopt the  Fidelity
                    Bancorp, Inc. 1997 Employee Stock Compensation Program.

          The stockholders voted as follows for Proposal (1)

                    For:         1,042,068  
                    Against:       100,536 
                    Abstain:        29,514    
                    Non-voted:     387,330                     
    
Item 5.  Other Information
             None

Item 6.  Exhibits and Reports on Form 8-K
          None


<PAGE>

                                   SIGNATURES

Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
Registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned, thereunto duly authorized.




                                                         FIDELITY BANK          
                                          
                                            
                                              
Date:  June 3, 1998                                  By: /s/ William L. Windisch
                                                         -----------------------
                                                         William L. Windisch    
                                                         President and          
                                                         Chief Executive Officer
                                                                                
                                                                                
Date:  June 3, 1998                                  By: /s/ Richard G. Spencer 
                                                         ---------------------- 
                                                         Richard G. Spencer     
                                                         Vice President and     
                                                         Chief Financial Officer