Fidelity Financial of Ohio Inc. makes announcement.

CINCINNATI--(BUSINESS WIRE))--April 29, 1996--Fidelity Financial of Ohio Inc. (Nasdaq National Market:FFOH) and Circle Financial Corp. (Nasdaq National Market:CRCL) announced today the execution of a definitive agreement pursuant to which Circle Financial will merge with and into Fidelity (the "merger").

In connection with the merger, each shareholder of Circle Financial will receive either cash or shares of Fidelity common stock at an expected value of $38.00 in exchange for each share of his or her Circle Financial common stock, subject to the pricing and other provisions set forth in the agreement.

It is intended that the transaction constitute a tax-free reorganization under the Internal Revenue Code, so that shareholders of Circle Financial who receive soley Fidelity common stock will not recognize gain or loss in connection with the exchange. Shareholders of Circle Financial who receive both Fidelity common stock and cash will be subject to tax on the cash received to the extent of the gain on the exchange, but will not be subject to tax on the Fidelity common stock received.

The amount of cash and the number of shares of Fidelity common stock that will be exchanged for each share of Circle Financial common stock will be determined by applying a formula, set forth in the definitive agreement, which is based on the average market price of the Fidelity common stock over a 20 trading day period ending on the date Fidelity and Circle Financial receive all requisite regulatory approvals and satisfy all applicable waiting periods related to the merger.

If, over the pricing period, the average market price of Fidelity common stock is equal to or greater than $9.00 but equal to or less than $11.00, Circle Financial shareholders electing to receive stock will receive for each share of Circle Financial common stock that number of shares of Fidelity common stock equal to the ratio determined by dividing $38.00 by the average market price of Fidelity common stock. If the average market price is greater than $11.00, Circle Financial shareholders will receive 3.45 shares of Fidelity common stock for each share of Circle Financial common stock while if the average market price is less than $9.00, they will receive 4.22 shares for each such share. Those shareholders of Circle Financial electing to receive cash will receive $38.00 for each share of Circle Financial common stock owned thereby. Under the terms of the definitive agreement, the aggregate amount of cash consideration paid to Circle Financial shareholders is expected to amount to 45 percent of the total consideration paid for the Circle Financial common stock by Fidelity.

In the event that the average market price of Fidelity common stock is less than $8.00, Circle Financial has the right to terminate the agreement, provided, however, that during the five-day period following receipt of notice of termination from Circle Financial, Fidelity has the option to increase the exchange ratio to 4.75 shares of Fidelity common stock for each share of Circle Financial common stock. If Fidelity so elects, the agreement will not be terminated.

Donald H. Rolf Jr., chairman and president of Circle Financial, commented as follows: "We are very excited about our proposed affiliation with Fidelity. This merger will allow us to better serve consumers and businesses in our market area by broadening the products and services we offer to our customers. Moreover, Fidelity shares our commitment to community involvement and quality customer service."

John R. Reusing, president and chief executive officer of Fidelity, stated as follows: "This acquisition is consistent with our ongoing efforts to increase both earnings per share and the rate of return that we generate on our shareholders' equity. We estimate that the transaction will close in the fourth quarter of 1996 and that it will be immediately accretive to earnings per share and increase our return on equity during 1997. We have analyzed this transaction using cost savings estimates of approximately 16 percent of Circle Financial's non-interest expenses. We are confident that we will meet or exceed our cost savings goal and that we will generate additional revenues by providing a full range of banking products to existing Circle Financial customers.

Reusing further stated: "While we believe that this is a good acquisition from a financial standpoint, we are also excited about the benefits to our franchise. This merger will greatly improve our existing branch network in the greater Cincinnati market and, as a result, Fidelity will represent the largest public savings institution within the Cincinnati market area." Reusing also noted that "Fidelity's capital levels and loan loss reserve coverage will remain strong."

Consummation of the merger is subject to the approval of the shareholders of both Fidelity and Circle Financial and the receipt of all required regulatory approvals.

In connection with the agreement, Circle Financial granted Fidelity an option to acquire up to 19.9 percent of the outstanding Circle Financial common stock upon the occurrence of certain events. Concurrently, Fidelity granted Circle Financial an option to acquire up to 9.9 percent of the outstanding Fidelity common stock upon the occurrence of certain events, which events are essentially the same as those set forth in the Circle Financial option.

Circle Financial is the holding company of People's Savings Association. People's Savings Association operates seven banking offices in the greater Cincinnati area. At March 31, 1996, Circle Financial had consolidated assets of $229.4 million and total stockholders' equity of $24.4 million.

Fidelity is the holding company for Fidelity Federal Savings Bank. Fidelity Federal Savings Bank operates three banking offices in the greater Cincinnati area. At March 31, 1996, Fidelity had consolidated assets of $249.4 million and total stockholders' equity of $50.8 million.

CONTACT: Fidelity Financial of Ohio Inc., Cincinnati

John R. Reusing, 513/351-6666

or

Circle Financial Corp., Sharonville 

Donald A. Rolf Jr., 513/563-4169