U.S. Securities and Exchange Commission


                             WASHINGTON, D.C. 20549

                                   FORM 10-Q 

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

                  For the quarterly period ended December 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 [ ] 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:  1,984,485 shares,  par value
$0.01, at February 1, 1999
<PAGE>
                     FIDELITY BANCORP, INC. AND SUBSIDIARIES

                                      Index


Part I - Financial Information

Item 1.  Financial Statements

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

          Statements of Income (Unaudited) for the Three Months Ended
               December 31, 1997 and 1998                                       

          Statements of Cash Flows (Unaudited) for the Three Months Ended
               December 31, 1997 and 1998                                       

          Statement of Changes in Stockholders' Equity (Unaudited) for the Three
               Months Ended December 31, 1997 and 1998                          

          Notes to Financial Statements                                         

Item 2.  Management's Discussion and Analysis of Financial Condition and
             Results of Operations
 
Item 3.  Quantitative and Qualitative Disclosures About Market Risk 


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)

                                                          December 31,      September 30,
              Assets                                         1998                1998     
              ------                                       --------            --------   
                                                         (Unaudited) 
<S>                                                        <C>                 <C>                            
Cash and amounts due from                                                                 
   depository institutions ...........................     $  5,609            $  2,539   
Interest-earning demand deposits with                                                     
   other institutions ................................        1,352                 613   
Investment securities held-to-maturity ...............        6,625               6,625   
Investment securities available-for-sale .............       64,975              57,590   
Loans receivable, net (Notes 5 and 6) ................      229,692             218,892   
Mortgage-backed securities, held-to-maturity .........       17,531              19,913   
Mortgage-backed securities available-for-sale ........       94,043              82,957   
Real estate owned, net ...............................           49                  21   
Federal Home Loan Bank stock - at cost ...............        6,183               5,050   
Accrued interest receivable, net .....................        2,769               2,573   
Office premises and equipment, net ...................        3,781               3,446   
Deferred tax asset ...................................          831                 700   
Prepaid expenses and sundry assets ...................        4,742               5,125   
                                                            --------           --------   
       Total Assets ..................................      $438,182           $406,044   
                                                            ========           ========   
                                                                                          
     Liabilities and Stockholders' Equity                                                            
Liabilities:                                                                              
   Savings deposits ..................................     $272,876            $261,735   
   Federal Home Loan Bank advances ...................      118,550             100,200   
   Reverse repurchase agreements .....................        2,357               1,870   
   Advance deposits by borrowers for                                                      
      taxes and insurance ............................        2,347               1,126   
   Accrued interest on savings and other deposits ....           17                  92   
   Accrued income taxes payable ......................          393                 171   
   Other accrued expenses and sundry liabilities .....        2,081               1,579   
   Guaranteed preferred beneficial interest in                                            
       Company's debentures ..........................       10,250              10,250   
                                                            --------           --------   
       Total Liabilities .............................      408,871             377,023   
                                                            --------           --------   
</TABLE>
<PAGE>
<TABLE>
<CAPTION>

                         FIDELITY BANCORP, INC. AND SUBSIDIARIES
                            Statements of Financial Condition
                                     (in thousands)
                                      (continued)

                                                          December 31,      September 30,
                                                            1998                1998     
                                                           --------            --------   
                                                         (Unaudited) 
<S>                                                        <C>                 <C> 
Stockholders' equity (Notes 3 and 4):                                                    
   Common Stock, $0.01 par value per share,                                              
   10,000,000 shares authorized; 1,980,590                                               
    and 1,978,543 shares issued and outstanding,                                         
    respectively .....................................           20                  20  
   Additional paid-in capital ........................       14,199              14,168  
   Retained earnings - substantially restricted ......       14,631              14,106  
   Accumulated Other Comprehensive                                                      
      Income, Net of Tax .............................          461                 727  
                                                            --------           --------  
       Total Stockholders' Equity ....................       29,311              29,021  
                                                            --------           --------  
       Total Liabilities and Stockholders' Equity ....     $438,182            $406,044  
                                                           ========            ========  
</TABLE>                                                                      
See accompanying notes to financial statements.
<PAGE>
<TABLE>
<CAPTION>
                         FIDELITY BANCORP, INC. AND SUBSIDIARIES
                            Statements of Income (Unaudited)
                                     (in thousands)

                                                                   Three Months Ended
                                                                       December 31,
                                                                 -----------------------
                                                                   1998            1997
                                                                 -------         -------
<S>                                                              <C>             <C>    
Interest income:
   Loans ................................................        $ 4,679         $ 4,000
   Mortgage-backed securities ...........................          1,641           2,068
   Investment securities:
       Taxable ..........................................            647             673
       Tax-exempt .......................................            416             250
   Deposits with other institutions .....................             13               5
                                                                 -------         -------
      Total interest income .............................          7,396           6,996
                                                                 -------         -------

Interest expense:
   Savings deposits .....................................          2,827           2,671
   Guaranteed preferred beneficial interest
      in subordinated debt ..............................            256             256
   Borrowed funds .......................................          1,543           1,384
                                                                 -------         -------
      Total interest expense ............................          4,626           4,311
                                                                 -------         -------
Net interest income before provision
   for loan losses ......................................          2,770           2,685
Provision for loan losses ...............................            105             115
                                                                 -------         -------
Net interest income after provision
   for loan losses ......................................          2,665           2,570
                                                                 -------         -------
Other income:
   Service fee income ...................................             45              34
   Gain (loss) on sale of investment
      and mortgage-backed securities, net ...............           --                 9
   Gain (loss) on sale of loans .........................              4               2
   Other operating income ...............................            276             173
                                                                 -------         -------
      Total other income ................................            325             218
                                                                 -------         -------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
                         FIDELITY BANCORP, INC. AND SUBSIDIARIES
                            Statements of Income (Unaudited)
                                     (in thousands)
                                        (Cont'd)

                                                                   Three Months Ended
                                                                       December 31,
                                                                 -----------------------
                                                                   1998            1997
                                                                 -------         -------
<S>                                                              <C>             <C>    
Operating expenses:
   Compensation and employee benefits ...................          1,192           1,044
   Occupancy and equipment expense ......................            210             138
   Depreciation and amortization ........................            147             123
   Federal insurance premiums ...........................             38              38
   (Gain) loss on real estate owned, net ................            (45)              8
   Other operating expenses .............................            445             410
                                                                 -------         -------
      Total operating expenses ..........................          1,987           1,761
                                                                 -------         -------

Income before income tax provision ......................          1,003           1,027
Income tax provision ....................................            301             359
                                                                 -------         -------
Net income ..............................................        $   702         $   668
                                                                 =======         =======

Basic earnings per common share (Note 3) ................        $  0.35         $  0.34
                                                                 =======         =======
Diluted earnings per common share (Note 3) ..............        $  0.35         $  0.33
                                                                 =======         =======
Dividends per common share (Note 3) .....................        $   .09         $  .072
                                                                 =======         =======
</TABLE>
See accompanying notes to financial statements.
<PAGE>
<TABLE>
<CAPTION>
                                    FIDELITY BANCORP, INC. AND SUBSIDIARIES
                                      Statements of Cash Flows (Unaudited)
                                                 (in thousands)

                                                                               Three Months Ended December 31,
                                                                               -------------------------------
                                                                                        1998         1997
                                                                                     --------      --------
<S>                                                                                  <C>           <C>     
Operating Activities:
     Net income ................................................................     $    702      $    668
     Adjustments  to  reconcile  net income to net cash  provided  by  operating
     activities:
         Provision for loan losses .............................................          105           115
         (Gain) Loss on real estate owned ......................................          (45)            8
         Depreciation of premises and equipment ................................          147           123
         Deferred loan fee amortization ........................................          (91)          (31)
         Amortization of investment and mortgage-backed securities
          discounts/premiums, net ..............................................          104            95
         Net (gain) loss on sale of investment securities ......................         --              (4)
         Net (gain) loss on sale of mortgage-backed securities .................         --              (5)
         Net (gain) loss  on sale of loans .....................................           (4)           (2)
          Origination of loans held-for-sale ...................................         (477)         --
          Proceeds from sale of loans held-for-sale ............................          479          --
         (Increase) decrease in interest receivable ............................         (197)         (142)
         (Increase) decrease in deferred tax asset .............................         (131)         (176)
         Increase (decrease) in accrued income taxes ...........................          221           526
         Increase (decrease) in interest payable ...............................          (76)         (143)
         Other changes, net ....................................................        1,088        (3,044)
                                                                                     --------      --------

        Net cash provided (used) by operating activities .......................        1,825        (2,012)
                                                                                     --------      --------
Investing Activities:

     Proceeds from sales of investment securities available-for-sale ...........         --           2,999
     Proceeds from maturities and principal repayments of
        investment securities available-for-sale ...............................        4,508             5
     Purchases of investment securities available-for-sale .....................      (11,832)       (5,430)
     Proceeds from sales of mortgage-backed securities available-for-sale ......         --           9,984
     Proceeds from maturities and principal repayments of  mortgage-
        backed securities available-for-sale ...................................        7,387         3,497
     Purchases of mortgage-backed securities available-for-sale ................      (19,023)      (11,856)
     Proceeds from maturities and principal repayments of investment
        securities held-to-maturity ............................................         --           1,072
     Proceeds from principal repayments of mortgage-backed
       securities held-to-maturity .............................................        2,356         1,415
     Net (increase) decrease in loans ..........................................      (10,991)       (8,803)
     Proceeds from sale of other loans .........................................          141           150
     Additions to office premises and equipment ................................         (483)         (114)
     Net purchases of FHLB Stock ...............................................       (1,133)          (27)
                                                                                     --------      --------

  Net cash provided (used) by investing activities .............................      (29,070)       (7,108)
                                                                                     --------      --------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
                        FIDELITY BANCORP, INC. AND SUBSIDIARIES
                     Statements of Cash Flows (Unaudited) (Cont'd.)
                                     (in thousands)

                                                       Three Months Ended December 31,
                                                       -------------------------------
                                                            1998           1997
                                                         --------      --------
<S>                                                        <C>            <C>  
Financing Activities:
Net increase (decrease) in savings deposits ........       11,141         8,676
Increase (decrease) in reverse repurchase agreements          488           304
Net increase (decrease) in FHLB advances ...........       18,350           350
Increase in Advance Payments by Borrowers for
  Taxes and Insurance ..............................        1,221         1,082
Cash dividends paid ................................         (177)         (140)
Stock options exercised ............................            6            50
Proceeds from sale of stock ........................           25            27
                                                         --------      --------

Net cash provided (used) by financing activities ...       31,054        10,349
                                                         --------      --------

Increase (decrease) in cash and cash equivalents ...        3,809         1,229

Cash and cash equivalents at beginning of period ...        3,152         3,975
                                                         --------      --------

Cash and cash equivalents at end of period .........     $  6,961      $  5,204
                                                         ========      ========


Supplemental Disclosure of Cash Flow Information

Cash paid during the period for:
  Interest on deposits and other borrowings ........     $  4,624      $  4,150
  Income taxes .....................................     $     65      $    215
                                                         --------      --------

Transfer of loan to REO ............................     $     28      $     21
                                                         --------      --------

</TABLE>

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



                                                      Additional                Accumulated Other
                                         Common        Paid-in     Retained       Comprehensive
                                          Stock        Capital      Earnings    Income Net of Tax         Total
                                        --------      --------      --------        --------             --------  
<S>                                     <C>           <C>           <C>             <C>                  <C>        
Balance at September 30, 1997 .....     $     16      $ 13,810      $ 11,822        $    233             $ 25,881   
                                                                                                                   
Net income ........................                                      668                                  668  
                                                                                                                   
  Cash dividends paid (Note 3) ....                                     (140)                                (140) 
                                                                                                                   
  Net change in unrealized gain                                                                                    
    (loss) on securities available-                                                                                
    for-sale, net of taxes ........                                                      395                  395  
                                                                                                                   
  Sale of stock through Dividend                                                                                   
    Reinvestment Plan .............                         50                                                 50  
                                                                                                                   
  Stock options exercised .........                         27                                                 27  
                                        --------      --------      --------        --------             --------  
                                                                                                                   
Balance at December 31, 1997 ......     $     16      $ 13,887      $ 12,350        $    628             $ 26,881  
                                        ========      ========      ========        ========             ========  
                                                                                                                   
                                                                                                                   
                                                                                                                   
Balance at September 30, 1998 .....     $     20      $ 14,168      $ 14,106        $    727             $ 29,021  
                                                                                                                   
Net income ........................                                      702                                  702  
                                                                                                                   
  Cash dividends paid (Note 3) ....                                     (177)                                (177) 
                                                                                                                   
  Net change in unrealized gain                                                                                    
    (loss) on securities available-                                                                                
    for-sale, net of taxes ........                                                     (266)                (266) 
                                                                                                                   
  Sale of stock through Dividend                                                                                   
    Reinvestment Plan .............                         25                                                 25  
                                                                                                                   
  Stock options exercised .........                          6                                                  6  
                                        --------      --------      --------        --------             --------  
                                                                                                                   
Balance at December 31, 1998 ......     $     20      $ 14,199      $ 14,631        $    461             $ 29,311  
                                        ========      ========      ========        ========             ========  
                                                                                                    
</TABLE>
<PAGE>
                     FIDELITY BANCORP, INC. AND SUBSIDIARIES
                   Notes to Financial Statements - (Unaudited)
                    September 30, 1998 and December 31, 1998

(1) Consolidation
The 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-Q, 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, 1998.
The  results  for the  three  month  period  ended  December  31,  1998  are not
necessarily  indicative  of the results that may be expected for the fiscal year
ending September 30, 1999.

(3) Earnings Per Share
In February 1997, the Financial  Accounting Standards Board ("FASB") issued SFAS
No. 128, "Earnings per Share". SFAS No. 128 provides revised reporting standards
for earnings per share ("EPS") and is effective for financial  statement periods
ending  after  December  15,  1997.  SFAS 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 SFAS No. 128 as of December
31, 1997.  The following  table sets forth the  computation of basic and diluted
earnings per share (amounts in thousands, except per share data):
<PAGE>
<TABLE>
<CAPTION>
                                                        Three Months Ended
                                                           December 31,
                                                       1998           1997
                                                      ------         ------ 
<S>                                                   <C>            <C>      
Numerator:
Net income ......................................     $  702         $  668   
                                                      ------         ------   
   Numerator for basic and                                                    
    diluted earnings per share ..................     $  702         $  668   
                                                      ------         ------   
Denominator:                                                                  
Denominator for basic earnings                                                
   per share - weighted average shares ..........      1,980          1,947   
Effect of dilutive securities:                                                
   Employee stock options .......................         51             69   
                                                      ------         ------   
Denominator for diluted earnings                                              
   per share - weighted average                                               
   shares and assumed conversions ...............      2,031          2,016   
                                                      ======         ======   
Basic earnings per share ........................     $  .35         $  .34   
                                                      ======         ======   
Diluted earnings per share ......................     $  .35         $  .33   
                                                      ======         ======  
</TABLE>

Per share  amounts  have been  restated  to give  retroactive  effect to the 25%
common stock split  declared by the  Company's  Board of  Directors  and paid on
March 31, 1998.

(4) Securities
The Company accounts for investments in debt and equity securities in accordance
with SFAS 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  securities  available-for-sale  are
reported as other comprehensive income in stockholder's equity. Unrealized gains
of $461,000,  net of tax, on investments  classified as  available-for-sale  are
recorded at December 31, 1998.
<PAGE>
(5) Loans Receivable

         Loans  receivable  are  comprised of the following  (dollar  amounts in
thousands):

<TABLE>
<CAPTION>

                                                     December 31,   September 30,
                                                        1998              1998
                                                     ---------        ---------
<S>                                                  <C>              <C>      
First mortgage loans:
         Conventional:
                  1-4 family dwellings .......       $ 117,520        $ 115,559
                  Multi-family dwellings .....           3,661            4,262
         Commercial ..........................          26,925           21,881
         Construction ........................          20,382           21,212
                                                     ---------        ---------
                                                       168,488          162,914
                                                     ---------        ---------
Less:
         Loans in process ....................         (12,223)         (12,916)
         Unearned discounts and fees .........          (1,147)          (1,142)
                                                     ---------        ---------
                                                       155,118          148,856
                                                     ---------        ---------
Installment loans:
         Home equity .........................          43,633           42,290
         Mobile home loans ...................               7               13
         Consumer loans ......................           2,199            2,359
         Other ...............................           4,859            4,460
                                                     ---------        ---------
                                                        50,698           49,122
                                                     ---------        ---------

Commercial business loans and leases:
         Commercial business loans ...........          21,815           19,509
         Commercial leases ...................           4,351            3,648
                                                     ---------        ---------
                                                        26,166           23,157
                                                     ---------        ---------

Less: Allowance for possible loan losses .....          (2,290)          (2,243)
                                                     ---------        ---------

         Loans receivable, net ...............       $ 229,692        $ 218,892
                                                     =========        =========

</TABLE>
 
(6)  Allowance for Loan Losses
Changes in the allowance for loan losses for the three months ended December 31,
1998 and 1997 are as follows (dollar amounts in thousands):
<PAGE>
<TABLE>
<CAPTION>
                                                          1998            1997
                                                        -------         -------
<S>                                                     <C>             <C>    
Balance at beginning of the fiscal year ........        $ 2,243         $ 1,931
Provision for loan losses ......................            105             115
Charge-offs ....................................            (59)            (27)
Recoveries .....................................              1               1
                                                        -------         -------

Balance at December 31, ........................        $ 2,290         $ 2,020
                                                        =======         =======
</TABLE>
The  provision  for loan losses  charged to expense is based upon past loan loss
experience and an evaluation of losses in the current loan portfolio,  including
the  evaluation  of  impaired  loans  under  SFAS  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.  SFAS 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 December 31, 1998, the recorded investment in loans that are considered to be
impaired  under SFAS No. 114 was $221,000.  The average  recorded  investment in
impaired loans during the three months ended December 31, 1998 was $248,000. For
the three months ended  December 31, 1998,  the Company  recognized  no interest
income on those impaired loans, using the cash basis of income recognition.

(7)  Comprehensive Income
In June 1997, the FASB issued SFAS No. 130, "Reporting  Comprehensive  Income ."
SFAS No. 130  establishes  standards for reporting and display of  comprehensive
income and its components (revenue,  expenses,  gains, and losses) in a full set
of general purpose  financial  statements.  SFAS No. 130 requires that all items
that are required to be recognized under  accounting  standards as components of
comprehensive  income be  reported  in an  annual  financial  statement  that is
displayed with the same prominence as other financial  statements.  SFAS No. 130
requires that an enterprise (a) classify items of other comprehensive  income by
their nature in a financial statement and (b) display the accumulated balance of
other  comprehensive  income  separately  from retained  earnings and additional
paid-in capital in the equity section of a statement of financial position.  For
the  three  months  ended  December  31,  1998 and  1997,  the  Company's  total
comprehensive  income  was  $436,000  and  $1.1  million,  respectively.   Total
comprehensive  income is  comprised  of net income of $702,000  and $668,000 and
other comprehensive income of ($266,000) and $395,000, net of tax, respectively.
Other comprehensive income consists of unrealized gains and losses on investment
securities and mortgage-backed securities available-for-sale.
 
(8)  Branch Opening
 On October 1, 1998,  the Bank opened its ninth full  service  branch  office at
2034 Penn  Avenue in  Pittsburgh's  Strip  District.  The  building in which the
branch is located is leased from an independent third party.
<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, 1998 and December 31, 1998

Total assets of the Bank  increased  $32.2 million or 7.9% to $438.2  million at
December 31, 1998 from $406.0 million at September 30, 1998. Significant changes
in individual  categories  were increases in loans  receivable of $10.8 million,
investment  securities  available-for-sale  of $7.4 million, and mortgage-backed
securities available-for-sale of $11.1 million and a decrease in mortgage-backed
securities held-to-maturity of $2.4 million.

Total  liabilities  of the Bank  increased  by $31.9  million  or 8.5% to $408.9
million at December  31, 1998 from $377.0  million at September  30,  1998.  The
increase  primarily  reflects a $11.1 million increase in savings  deposits,  an
increase in borrowings  of $18.8 million and a $1.2 million  increase in advance
payments by borrowers for taxes and insurance.

Stockholders' equity increased $290,000 or 1.0% to $29.3 million at December 31,
1998,  compared to September 30, 1998. The increase  reflects net income for the
three month period ended December 31, 1998 of $702,000,  stock options exercised
of $6,000 and stock  issued  under the  Dividend  Reinvestment  Plan of $25,000.
Partially  offsetting  these  increases were common stock cash dividends paid of
$177,000   and  a  decrease   in   unrealized   holding   gains  on   securities
available-for-sale of $266,000.

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 restructurings during the periods presented.
<TABLE>
<CAPTION>
                                                             September 30, 1998   December 31, 1998
                                                             ------------------   -----------------
                                                                          (in thousands)
<S>                                                                  <C>                 <C>       
Non-accrual residential real                                                                       
  estate loans (one-to-four-family) ....................             $224                $265      
Non-accrual construction, multi-family                                                             
  residential and commercial real estate loans .........              199                 199      
Non-accrual installment and                                                                        
  commercial business loans ............................              129                 210      
                                                                     ----                ----                                
Total non-performing loans .............................             $552                $674      
                                                                     ====                ==== 
Total non-performing loans as                                                                      
  a percent of net loans receivable ....................              .25%                .29%     
                                                                     ====                ====  
Total real estate owned,                                                                           
  net of related reserves ..............................             $ 21                $ 49                      
                                                                     ====                ==== 
Total non-performing loans and real estate                                                         
  owned as a percent of total assets ...................              .14%                .16%     
                                                                     ====                ====
</TABLE>
<PAGE>
Included  in  non-performing  loans at  December  31,  1998 are 4  single-family
residential real estate loans totaling $265,000, one commercial real estate loan
totaling  $199,000,  10 installment  loans totaling  $52,000,  three  commercial
business loans totaling  $101,000 and three commercial  business leases totaling
$57,000.  The  commercial  real  estate  loan is on a  retail  building  that is
currently leased. The Bank has begun foreclosure proceedings on the loan.

The 10  installment  loans  total  $52,000  and  consist of various  secured and
unsecured consumer loans and credit card loans. The largest loan is for $14,000.

Of the  three  commercial  loans,  two  were  to  entities  that  have  declared
bankruptcy;  however,  one of the loans is SBA guaranteed.  The three commercial
business leases were for leased equipment to three different borrowers.

At December 31, 1998, the Bank had an allowance for possible loan losses of $2.3
million or 1.00% of net loans  receivable,  as compared to an  allowance of $2.2
million or 1.02% of net loans  receivable at September  30, 1998.  The allowance
for possible  loan losses  equals 317% of  non-performing  loans at December 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 December 31, 1998 is appropriate.

Real estate owned at December 31, 1998 consists of two single-family residential
properties located in Pittsburgh,  Pennsylvania totaling $49,000. The properties
are currently for sale and  management  believes that the carrying  value of the
properties at December 31, 1998  approximates  the net  realizable  value of the
properties.  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 Months Ended December 31, 1998 and 1997

Net Income

Net income for the three months ended December 31, 1998 was $702,000 compared to
$668,000  for the same  period in 1997,  an  increase  of $34,000  or 5.2%.  The
increase  reflects  an  increase in net  interest  income of $85,000 or 3.2%,  a
decrease in the  provision  for loan  losses of $10,000 or 8.7%,  an increase in
other  income of  $107,000 or 48.8% and an  increase  in  operating  expenses of
$226,000  or 12.8%.  Additionally,  there was a decrease  in the  provision  for
income taxes of $58,000 or 16.2%.

Interest Rate Spread

The Bank's interest rate spread,  the difference  between yields calculated on a
tax-equivalent basis on interest-earning assets and the cost of funds, decreased
to 2.70% in the three  months  ended  December  31,  1998 from 2.81% in the same
period in 1997.  The  following  table shows the average  tax-equivalent  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.
<PAGE>
<TABLE>
<CAPTION>
                                                          Three Months Ended December 31,
                                                               1998           1997
                                                               ----          -----
<S>                                                            <C>            <C>  
Average yield on:
   Mortgage loans .................................            8.08%          8.25%
   Mortgage-backed securities .....................            6.06           6.51
   Installment loans ..............................            8.34           8.41
   Commercial business loans ......................            9.26          10.59
   Interest-earning deposits with other
     institutions, investment securities,
     and FHLB stock (1) ...........................            6.63           7.02
                                                               ----          -----
   Total interest-earning assets ..................            7.38           7.59
                                                               ----          -----

Average rates paid on:
   Savings deposits ...............................            4.19           4.25
   Borrowed funds .................................            5.74           5.99
                                                               ----          -----
   Total interest-bearing liabilities .............            4.68           4.78
                                                               ----          -----

Average interest rate spread ......................            2.70%          2.81%
                                                               ====          =====
Net yield on interest-earning assets ..............            2.87%          2.98%
                                                               ====          =====
</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  $679,000  or 17.0% to $4.7  million for the three
months  ended  December  31,  1998,  compared  to the same  period in 1997.  The
increase is  attributable  to an increase in the average loan portfolio  balance
outstanding  during  the 1998  period,  partially  offset by a  decrease  in the
average yield earned on these assets in the 1998 period, as compared to the same
period in 1997.  The  increase  in the  average  balance  of the loan  portfolio
reflects  management's  continued  strategy of emphasizing  and increasing  loan
originations.

Interest  on  mortgage-backed  securities  decreased  $427,000  or 20.6% to $1.6
million for the three  months ended  December 31, 1998,  as compared to the same
period in 1997.  The  decrease  is  attributable  to a decrease  in the  average
portfolio balance  outstanding  during the 1998 period, as well as a decrease in
the average yield earned on these assets in the 1998 period,  as compared to the
same period in 1997.

Interest on investment  securities  increased  $140,000 or 15.2% to $1.1 million
for the three months ended  December 31, 1998, as compared to the same period in
1997.  The  increase is  attributable  to an increase in the average  balance of
investments  securities  held  during the 1998  period,  as compared to the same
period in 1997, partially offset by a decrease in yield.
<PAGE>
Interest Expense

Interest on savings deposits  increased $156,000 or 5.9% to $2.8 million for the
three month  period ended  December 31, 1998,  as compared to the same period in
1997.  The  increase  reflects an  increase  in the  average  balance of savings
deposits for the 1998 period compared to 1997, partially offset by a decrease in
the average cost of deposits.

Interest on borrowed funds  increased  $159,000 or 11.5% to $1.5 million for the
three month  period ended  December 31, 1998,  as compared to the same period in
1997. The increase reflects  primarily an increase in the Federal Home Loan Bank
("FHLB")  advances  outstanding  during the 1998 period,  partially  offset by a
decrease in the average cost of borrowing during the 1998 period, as compared to
1997. The Bank continued to rely on these  wholesale  funding sources in 1998 to
fund growth.

Interest on guaranteed  preferred  beneficial  interest in subordinated debt was
$256,000  for the three month  periods  ended  December  31, 1998 and 1997.  The
Company's debentures 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
$85,000 or 3.2% to $2.8 million for the three months ended December 31, 1998, as
compared  to the same  period  in 1997.  This  increase  is  attributable  to an
increase in net interest  earning assets,  partially offset by a decrease in the
interest rate spread,  from 2.81% for the three month period ended  December 31,
1997, to 2.70% for the same period in 1998.

Provision for Loan Losses

The  provision  for loan losses  decreased  $10,000 or 8.7% to $105,000  for the
three month  period ended  December 31, 1998,  as compared to the same period in
the prior year. The provision for both periods reflects management's  evaluation
of economic  conditions  and other factors  described  below.  The allowance for
possible  loan losses has  increased  from $2.0  million at December 31, 1997 to
$2.3 million at December 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 size of the loan portfolio, 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  $107,000 or 48.8% to $325,000 for
the three  months ended  December  31,  1998,  as compared to the same period in
1997.
<PAGE>
Service  fee income,  which  includes  late  charges on loans and fees for loans
serviced for others,  increased $11,000 or 31.4% to $45,000 for the period ended
December 31, 1998, as compared to the same period in 1997. The results primarily
reflect an increase in late charges on loans.

Gain on the sale of investment and  mortgage-backed  securities was zero for the
period ended  December  31,  1998,  as compared to a gain of $9,000 for the same
period in 1997.  There were no sales of  securities  in the fiscal 1998  period.
Sales in the 1997  period  were made from the  available-for-sale  category  and
represented a partial  repositioning  of the portfolio based upon current market
conditions.

Gain on sale of loans was $4,000 and $2,000 for the three  month  periods  ended
December 31, 1998 and 1997, respectively.  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
loans for its portfolio, except those that will be sold to and serviced by SLMA.
Sales to SLMA  increased  slightly in the period ended  December  31,  1998,  as
compared to 1997.

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  $103,000 or 59.7% to $276,000  for the three month
period ended  December 31, 1998,  as compared to the same period in fiscal 1997.
The  increase is  primarily  due to  increased  non-sufficient  funds fees,  the
imposition  of a surcharge  beginning on April 1, 1998 on nonbank  customers for
the use of the  Bank's  automated  teller  machines  and  earnings  on the  cash
surrender value of life insurance  policies on certain  executive  officers.  In
addition,  in July  1998 the  Bank  introduced  a  program  to sell  non-insured
investment  products such as mutual funds and annuities to both Bank and nonbank
customers. Fiscal 1998 results include fees earned on this activity.

Other Expenses

Total  operating  expenses  increased  $226,000 or 12.8% to $2.0 million for the
three months ended December 31, 1998, compared to the same period in 1997.

Compensation,  payroll  taxes and fringe  benefits,  the  largest  component  of
operating  expenses,  increased  $148,000 or 14.2% to $1.2 million for the three
month  period  ended  December  31,  1998,  compared to the same period in 1997.
Factors  contributing  to the  increase  were normal  salary  increases,  higher
bonuses  awarded in the 1998  period,  an increase in the number of employees on
the  payroll,  and an  increase in  retirement  and health  care  expenses.  The
increase in the number of  employees  reflects  staffing  additions  for the new
branch office opened in Pittsburgh's  Strip District in October 1998, as well as
staffing for the Bank's new brokerage services program.

Office occupancy and equipment  expense  increased  $72,000 or 51.6% to $210,000
for the three  months ended  December  31, 1998,  compared to the same period in
1997. The increase  partially  reflects  costs  associated  with  renovating and
opening the Bank's new Strip District branch in October 1998,  which is a leased
facility.  Additionally,  the increase reflects increased equipment  maintenance
costs, a portion of which was incurred dealing with the Year 2000 problem.
<PAGE>
Depreciation  and  amortization  increased  $24,000 or 19.3% to $147,000 for the
1998 period as compared to 1997. The increase reflects  additional  depreciation
on  equipment  added or updated  during the last year,  as well as  depreciation
incurred on renovations  completed at the Bank's data processing and back office
location.

Federal insurance premiums were $38,000 for both the 1998 and 1997 periods.

Net gain on real estate owned was $45,000 in the 1998  period,  as compared to a
net loss of $8,000 for the three months ended December 31, 1997. The gain in the
1998 period  reflected  the sale of a  residential  building  lot  obtained in a
foreclosure  that had  previously  been  written off due to an  inability to get
required  building  permits from the local  municipality.  Once the  appropriate
permits were issued,  the lot was sold.  There were no individually  significant
transactions included in the 1997 results.

Other operating expenses,  which consists of check processing costs,  consulting
fees, legal and audit fees,  advertising,  bank charges and other administrative
expenses,  amounted to $445,000 and $410,000 for the three month  periods  ended
December  31,  1998 and 1997,  respectively,  an  increase  of  $35,000 or 8.4%.
Significant  variations  between periods include  increases in consulting  fees,
telephone expenses, and expenses relating to credit cards issue by the Bank.

Income Taxes

Income taxes  decreased  $58,000 or 16.2% to $301,000 for the three month period
ended  December 31, 1998,  compared to the same period in 1997.  The decrease in
taxes results from a decrease in taxable income.  The decrease in taxable income
is primarily  attributable to an increase in tax-exempt  investments  generating
non-taxable  income. The effective tax rate decreased to approximately  30.0% in
1998 from approximately 35.0% in the same period in 1997.

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
guidelines  include  the  concept of Tier 1 capital  and total  capital.  Tier 1
capital is essentially  common equity,  excluding net unrealized  gain (loss) on
securities  available-for-sale  and  goodwill,  plus certain  types of preferred
stock,  including  the  Preferred  Securities  issued by the Trust in 1997.  The
Preferred  Securities  may comprise up to 25% of the  Company's  Tier 1 capital.
Total  capital  includes  Tier 1 capital and other forms of capital  such as the
allowance for loan losses,  subject to limitations,  and subordinated  debt. The
guidelines  establish a minimum standard risk-based target ratio of 8%, of which
at least 4% must be in the form of Tier 1 capital.  At December  31,  1998,  the
Company had Tier 1 capital as a percentage of risk-weighted assets of 15.43% and
total risk-based capital as a percentage of risk-weighted assets of 16.60%.

In addition,  the Federal Reserve Board has established  minimum  leverage ratio
guidelines for bank holding companies.  These guidelines currently provide for a
minimum  ratio of 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 December  31, 1998,  the Company had a
Leverage Ratio of 9.09%.
<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 December 31, 1998, the Bank complied with the minimum
leverage  ratio  having  Tier 1 capital of 6.79% 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 December
31, 1998,  the Bank's total  capital to  risk-weighted  assets ratio  calculated
under the FDIC capital requirement was 12.42%.

A reconciliation of Stockholders'  Equity for the Bank to Regulatory  Capital is
as follows:

Stockholder's equity at December 31, 1998 (1)                       $28,489,206
 Less: Unrealized securities gains                                      439,332
                                                                    ----------- 
Tier 1 Capital at December 31, 1998                                  28,049,874
Plus: Qualifying loan loss allowance                                  2,289,557
                                                                    ----------- 
Total capital at December 31, 1998                                  $30,339,431
                                                                    ===========


(1) Represents  equity  capital  of the  Bank as  reported  to the  FDIC and the
    Pennsylvania Department of Banking on Form 032.

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 December 31, 1998,  the total of approved  loan  commitments
amounted to $2.8 million. In addition, the Bank had $12.2 million of undisbursed
loan funds at that date. The amount of savings  certificates which mature during
the next twelve  months  totals  approximately  $117.4  million,  a  substantial
portion of which management  believes,  on the basis of prior  experience,  will
remain in the Bank.

Year 2000

The Year 2000 problem exists because many computer systems use only the last two
digits  to  refer  to  a  year.  This  convention  could  affect  date-sensitive
calculations  that treat "00" as the year 1900,  rather than 2000. An additional
issue is that 1900 was not a leap  year,  whereas  the year 2000 is.  Therefore,
some programs may not properly provide for February 29, 2000. This anomaly could
result in miscalculations  when processing critical  date-sensitive  information
after December 31, 1999.

The following  discussion of the  implications  of the Year 2000 problem for the
Company  contains  numerous  forward  looking  statements  based  on  inherently
uncertain information. The cost of the project and the date on which the Company
plans to  complete  Year  2000  modifications  are  based on  management's  best
estimates,  which are derived utilizing a number of assumptions of future events
<PAGE>
including the continued  availability of internal and external resources,  third
party modifications and other factors.  However,  there can be no guarantee that
these  statements  will be achieved and actual  results could differ.  Moreover,
although management believes it will be able to make the necessary modifications
in advance,  there can be no guarantee  that failure to modify the systems would
not have a material adverse impact on the Company.

In May 1997 the  Company  established  a Year  2000  Compliance  Committee  (the
"Committee")  and  subsequently  developed  a Year  2000  Compliance  Plan  (the
"Plan"). The objectives of the Plan and the Committee are to prepare the Company
for the new millennium.  The Plan encompasses the following  phases:  Awareness,
Assessment, Renovation, Validation and Implementation.  These phases will enable
the Company to identify risks,  develop an action plan, perform adequate testing
and complete  affirmation  that its processing  systems will be Year 2000 ready.
Execution of the Plan is currently on target. The Company is currently in Phases
3 and 4, Renovation and Validation, which involves replacement and/or testing of
changes to hardware  and software  accompanied  by  monitoring  and testing with
vendors. Concurrently, the Company is also addressing some issues related to the
Implementation Phase.  Prioritization of the most critical software applications
and hardware configurations have been addressed, along with contract and service
agreements.  A significant  portion of the Company's data processing software is
provided by third party vendors. The Company has maintained ongoing contact with
these vendors so that  modification of the software for Year 2000 readiness is a
top priority. The Company, in coordination with these vendors, has substantially
completed testing all significant applications,  and is expected to complete the
remaining  portion of the testing,  though there is no  assurance,  by March 31,
1999. In addition, all significant hardware that required replacement or upgrade
has been purchased or the upgrade completed.  Testing of this equipment has been
substantially  completed  and  installation  of the  equipment is expected to be
completed,  though there is no  assurance,  by March 31,  1999.  The Company has
contacted all other  material  vendors and suppliers  regarding  their Year 2000
state of readiness.  Each of these third parties has delivered written assurance
to the  Company  that they  expect to be Year 2000  compliant  prior to the Year
2000.  The  Company  has  completed   contacting  all  material   customers  and
non-information  technology suppliers (i.e., utility systems,  telephone systems
and  security  systems)  regarding  their  Year  2000  state of  readiness.  The
Validation   phase  is  targeted  for   completion   by  March  31,  1999.   The
Implementation  Phase is to certify that systems are Year 2000 ready, along with
assurances  that any new systems are  compliant on a  going-forward  basis.  The
Implementation Phase is targeted for completion by June 30, 1999.

Monitoring  and managing the Year 2000 project will result in additional  direct
and indirect  costs to the Company.  Direct costs include  potential  charges by
third party  software  vendors  for product  enhancements,  the  replacement  of
computer  hardware  and  related  equipment  that was not Year 2000  ready  with
equipment that is, costs involved in testing software and hardware  products for
Year 2000  compliance,  and any resulting costs for developing and  implementing
contingency  plans for critical  software and  hardware  products  which are not
enhanced.  Indirect  costs  will  principally  consist  of the time  devoted  by
existing  employees in managing vendor progress,  testing enhanced  software and
hardware products and implementing any necessary contingency plans. Total direct
costs are estimated not to exceed $500,000,  but are not expected to be material
to the Company's  results of operations in any one quarter or fiscal year.  This
estimate  includes the cost, and resulting  depreciation,  of  accelerating  the
replacement of computer equipment that is currently fully depreciated,  or would
have been by the Year 2000,  and that would have been  replaced in the  ordinary
course of business over the next two years.  Year 2000 remediation costs are not
<PAGE>
expected  to  have a  material  adverse  impact  on  the  long-term  results  of
operations,  liquidity or consolidated  financial  position of the Company.  The
company does not separately  track the internal costs incurred for the Year 2000
project;   such  costs  are  principally  the  related  payroll  costs  for  its
information systems group and other employees involved in the project.

The Company is developing remediation  contingency plans and business resumption
plans  specific  to the Year 2000.  Remediation  contingency  plans  address the
actions to be taken if the current  approach to  remediating a system is falling
behind  schedule or otherwise  appears to be in jeopardy of failing to deliver a
year 2000 ready  system  when  needed.  Business  resumption  contingency  plans
address the actions that would be taken if critical business functions cannot be
carried out in the normal manner upon entering the next century due to system or
supplier failure.

Despite the best efforts of management to address this issue, the vast number of
external entities that have direct and indirect business  relationships with the
Company,  such  as  customers,  vendors,  payment  system  providers  and  other
financial  institutions  makes it  impossible  to assure that failure to achieve
compliance  by one or more of these  entities  would not have  material  adverse
impact on the operations of the Company.
 

Item 3.  Quantitative and Qualitative Disclosures About Market Risk

         There  have  been  no  material   changes  in   information   regarding
         quantitative  and  qualitative  disclosures  about market risk from the
         information  presented as of September 30, 1998 (in the Company's  Form
         10-K) to December 31, 1998.
<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

         None


Item 5.  Other Information

         None


Item 6.  Exhibits and Reports on Form 8-K

         None

<PAGE>



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 BANCORP, INC.



Date:   February 11, 1999                 By:      /s/ William L. Windisch
                                                   --------------
                                                   William L. Windisch
                                                   President and Chief Executive
                                                   Officer


Date:   February 11, 1999                 By:      /s/ Richard G. Spencer
                                                   --------------

                                                   Richard G. Spencer
                                                   Vice President and Chief
                                                   Financial Officer