Document and Entity Information
Document and Entity Information | ||
3 Months Ended
Mar. 31, 2010 | May. 03, 2010
| |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | 2010-03-31 | |
Document Fiscal Year Focus | 2,010 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | NYB | |
Entity Registrant Name | NEW YORK COMMUNITY BANCORP INC | |
Entity Central Index Key | 0000910073 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 435,452,463 |
CONSOLIDATED STATEMENTS OF COND
CONSOLIDATED STATEMENTS OF CONDITION (USD $) | ||
In Thousands | Mar. 31, 2010
| Dec. 31, 2009
|
Assets: | ||
Cash and cash equivalents | $2,547,889 | $2,670,857 |
Securities available for sale: | ||
Mortgage-related ($609,519 and $602,233 pledged, respectively) | 679,912 | 774,205 |
Other securities ($316,411 and $302,022 pledged, respectively) | 424,384 | 744,441 |
Total available-for-sale securities | 1,104,296 | 1,518,646 |
Securities held to maturity: | ||
Mortgage-related ($2,181,431 and $2,459,161 pledged, respectively) (fair value of $2,268,566 and $2,551,608, respectively) | 2,187,537 | 2,465,956 |
Other securities ($1,770,266 and $1,564,585 pledged, respectively) (fair value of $2,242,142 and $1,698,054, respectively) | 2,257,643 | 1,757,641 |
Total held-to-maturity securities | 4,445,180 | 4,223,597 |
Total securities | 5,549,476 | 5,742,243 |
Loans held for sale | 764,358 | |
Non-covered loans held for investment, net of deferred loan fees and costs | 23,417,756 | 23,376,599 |
Less: Allowance for loan losses | (137,443) | (127,491) |
Non-covered loans held for investment, net | 23,280,313 | 23,249,108 |
Covered loans (includes $351.3 million of loans held for sale at December 31, 2009) | 4,759,139 | 5,016,100 |
Total loans, net | 28,803,810 | 28,265,208 |
Federal Home Loan Bank ("FHLB") stock, at cost | 444,118 | 496,742 |
Premises and equipment, net | 202,514 | 205,165 |
FDIC loss share receivable | 796,841 | 743,276 |
Goodwill | 2,436,401 | 2,436,401 |
Core deposit intangibles, net | 101,108 | 105,764 |
Bank-owned life insurance | 722,171 | 715,962 |
Other assets (includes $44.6 million of other real estate owned ("OREO") covered by FDIC loss sharing agreements at March 31, 2010) | 826,409 | 772,251 |
Total assets | 42,430,737 | 42,153,869 |
Deposits: | ||
NOW and money market accounts | 7,966,846 | 7,706,288 |
Savings accounts | 3,873,954 | 3,788,294 |
Certificates of deposit | 9,185,762 | 9,053,891 |
Non-interest-bearing accounts | 1,704,659 | 1,767,938 |
Total deposits | 22,731,221 | 22,316,411 |
Borrowed funds: | ||
FHLB advances | 8,670,024 | 8,955,769 |
Repurchase agreements | 4,125,000 | 4,125,000 |
Total wholesale borrowings | 12,795,024 | 13,080,769 |
Junior subordinated debentures | 427,251 | 427,371 |
Other borrowings | 653,575 | 656,546 |
Total borrowed funds | 13,875,850 | 14,164,686 |
Other liabilities | 410,205 | 305,870 |
Total liabilities | 37,017,276 | 36,786,967 |
Stockholders' equity: | ||
Preferred stock at par $0.01 (5,000,000 shares authorized; none issued) | ||
Common stock at par $0.01 (600,000,000 shares authorized; 435,441,094 and 433,197,332 shares issued, respectively; 435,441,094 and 433,197,332 shares outstanding, respectively) | 4,354 | 4,332 |
Paid-in capital in excess of par | 5,272,490 | 5,238,231 |
Retained earnings | 191,185 | 175,193 |
Unallocated common stock held by Employee Stock Ownership Plan ("ESOP") | (716) | (951) |
Accumulated other comprehensive loss, net of tax: | ||
Net unrealized loss on available-for-sale securities and the non-credit portion of other-than-temporary impairment ("OTTI") losses, net of tax | (11,232) | (6,274) |
Net unrealized loss on securities transferred from available for sale to held to maturity, net of tax | (3,752) | (3,927) |
Net unrealized loss on pension and post-retirement obligations, net of tax | (38,868) | (39,702) |
Total accumulated other comprehensive loss, net of tax | (53,852) | (49,903) |
Total stockholders' equity | 5,413,461 | 5,366,902 |
Total liabilities and stockholders' equity | $42,430,737 | $42,153,869 |
1_CONSOLIDATED STATEMENTS OF CO
CONSOLIDATED STATEMENTS OF CONDITION (Parenthetical) (USD $) | ||
Mar. 31, 2010
| Dec. 31, 2009
| |
Mortgage-related, pledged | $609,519,000 | $602,233,000 |
Other securities, pledged | 316,411,000 | 302,022,000 |
Mortgage-related, pledged | 2,181,431,000 | 2,459,161,000 |
Mortgage-related, fair value | 2,268,566,000 | 2,551,608,000 |
Other securities, pledged | 1,770,266,000 | 1,564,585,000 |
Other securities, fair value | 2,242,142,000 | 1,698,054,000 |
Covered loans, loans held for sale | 351,300 | |
Other assets, other real estate owned ("OREO") covered by FDIC loss sharing agreements | $44,600 | |
Preferred stock, par | 0.01 | 0.01 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, issued | 0 | 0 |
Common stock, par | 0.01 | 0.01 |
Common stock, shares authorized | 600,000,000 | 600,000,000 |
Common stock, shares issued | 435,441,094 | 433,197,332 |
Common stock, shares outstanding | 435,441,094 | 433,197,332 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (USD $) | ||
In Thousands, except Per Share data | 3 Months Ended
Mar. 31, 2010 | 3 Months Ended
Mar. 31, 2009 |
Interest Income: | ||
Mortgage and other loans | $413,675 | $321,717 |
Securities and money market investments | 68,703 | 78,389 |
Total interest income | 482,378 | 400,106 |
Interest Expense: | ||
NOW and money market accounts | 16,431 | 7,563 |
Savings accounts | 5,745 | 4,216 |
Certificates of deposit | 37,553 | 52,723 |
Borrowed funds | 128,065 | 128,689 |
Total interest expense | 187,794 | 193,191 |
Net interest income | 294,584 | 206,915 |
Provision for loan losses | 20,000 | 6,000 |
Net interest income after provision for loan losses | 274,584 | 200,915 |
Non-Interest Income: | ||
Total loss on OTTI of securities | (13,185) | |
Less: Non-credit portion of OTTI recorded in other comprehensive income (before taxes) | 12,462 | |
Net loss on OTTI recognized in earnings | (723) | |
Fee income | 13,965 | 9,291 |
Bank-owned life insurance | 7,401 | 6,840 |
Net loss on sale of securities | (8) | |
Gain on debt repurchase | 293 | |
Other | 34,116 | 6,045 |
Total non-interest income | 55,044 | 22,176 |
Operating expenses: | ||
Compensation and benefits | 66,900 | 42,422 |
Occupancy and equipment | 21,665 | 18,736 |
General and administrative | 40,290 | 22,753 |
Total operating expenses | 128,855 | 83,911 |
Amortization of core deposit intangibles | 7,892 | 5,687 |
Total non-interest expense | 136,747 | 89,598 |
Income before income taxes | 192,881 | 133,493 |
Income tax expense | 68,732 | 44,804 |
Net Income | 124,149 | 88,689 |
Other comprehensive income, net of tax: | ||
Change in net unrealized (loss) gain on securities and non-credit portion of OTTI for the period | (4,783) | 8,030 |
Change in pension and post-retirement obligations | 834 | 1,203 |
Total comprehensive income, net of tax | $120,200 | $97,922 |
Basic earnings per share | 0.29 | 0.26 |
Diluted earnings per share | 0.29 | 0.26 |
CONSOLIDATED STATEMENT OF CHANG
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (USD $) | |||||||
In Thousands | Common Stock (Par Value
| Paid-in Capital in Excess of Par
| Retained Earnings
| Treasury Stock
| Unallocated Common Stock Held by ESOP
| Accumulated Other Comprehensive Loss, net of tax
| Total
|
Balance at beginning of year at Dec. 31, 2009 | $4,332 | $5,238,231 | $175,193 | ($951) | ($49,903) | $5,366,902 | |
Allocation of ESOP stock | 920 | ||||||
Change in net unrealized gain on securities available for sale, net of tax of $1,408 | 2,219 | ||||||
Purchase of common stock (116,066 shares) | (1,706) | ||||||
Net income | 124,149 | 124,149 | |||||
Earned portion of ESOP | 235 | ||||||
Non-credit portion of OTTI losses recognized in other comprehensive income, net of tax of $4,838 | (7,624) | ||||||
Dividends paid on common stock ($0.25 per share) | (108,157) | ||||||
Compensation expense related to restricted stock awards | 2,902 | ||||||
Amortization of net unrealized loss on securities transferred from available for sale to held to maturity, net of tax of $111 | 175 | ||||||
Change in pension and post-retirement obligations, net of tax of $529 | 834 | ||||||
Exercise of stock options | 1 | 1,528 | 1,044 | ||||
Shares issued for restricted stock awards (353,944 shares) | 4 | (666) | 662 | ||||
Reclassification adjustment for loss on sale and OTTI of securities, net of tax of $284 | 447 | ||||||
Tax effect of stock plans | 657 | ||||||
Shares issued in connection with the direct stock purchase feature of the Dividend Reinvestment and Stock Purchase Plan ("DRP") (1,766,482 shares) | 17 | 28,918 | |||||
Balance at end of period at Mar. 31, 2010 | $4,354 | $5,272,490 | $191,185 | ($716) | ($53,852) | $5,413,461 |
2_CONSOLIDATED STATEMENT OF CHA
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (Parenthetical) (USD $) | |
In Thousands, except Share data | 3 Months Ended
Mar. 31, 2010 Common Stock (Par Value |
Common Stock (Par Value: $0.01): | |
Exercise of stock options, shares | 123,336 |
Shares issued for restricted stock awards, shares | 353,944 |
Shares issued in connection with the direct stock purchase feature of the Dividend Reinvestment and Stock Purchase Plan (DRP), shares | 1,766,482 |
Retained Earnings: | |
Dividends paid on common stock, per share | 0.25 |
Treasury Stock: | |
Purchase of common stock, shares | 116,066 |
Exercise of stock options, shares | 70,510 |
Shares issued for restricted stock awards, shares | 45,556 |
Accumulated Other Comprehensive Loss, net of tax: | |
Change in net unrealized gain on securities available for sale, tax | $1,408 |
Non-credit portion of OTTI losses recognized in other comprehensive income, tax | 4,838 |
Amortization of net unrealized loss on securities transferred from available for sale to held to maturity, tax | 111 |
Change in pension and post-retirement obligations, tax | 529 |
Reclassification adjustment for loss on sale and OTTI of securities, tax | $284 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | ||
In Thousands | 3 Months Ended
Mar. 31, 2010 | 3 Months Ended
Mar. 31, 2009 |
Cash Flows from Operating Activities: | ||
Net income | $124,149 | $88,689 |
Adjustments to reconcile net income to net cash used in operating activities: | ||
Provision for loan losses | 20,000 | 6,000 |
Depreciation and amortization | 4,935 | 5,024 |
Amortization of premiums (accretion of discounts), net | 1,881 | (532) |
Net change in net deferred loan origination costs and fees | 1,846 | (322) |
Amortization of core deposit intangibles | 7,892 | 5,687 |
Net loss on sale of securities | 8 | |
Net gain on sale of loans | (7,558) | (108) |
Stock plan-related compensation | 4,057 | 3,485 |
Loss on OTTI of securities recognized in earnings | 723 | |
Changes in assets and liabilities: | ||
Decrease (increase) in deferred tax asset, net | 1,235 | (2,879) |
Increase in other assets | (22,767) | (15,602) |
Increase (decrease) in other liabilities | 98,575 | (165,410) |
Origination of loans held for sale | (1,349,160) | (17,661) |
Proceeds from sale of loans originated for sale | 911,038 | 15,446 |
Net cash used in operating activities | (203,146) | (78,183) |
Cash Flows from Investing Activities: | ||
Proceeds from repayment of securities held to maturity | 332,077 | 929,929 |
Proceeds from repayment of securities available for sale | 420,315 | 52,966 |
Proceeds from sale of securities available for sale | 660 | |
Purchase of securities held to maturity | (565,524) | (822,245) |
Net redemption (purchase) of FHLB stock | 56,211 | (15,745) |
Net decrease (increase) in loans | 84,698 | (103,622) |
Purchase of premises and equipment, net | (2,284) | (657) |
Net cash acquired in business combinations | 140,895 | |
Net cash provided by investing activities | 467,048 | 40,626 |
Cash Flows from Financing Activities: | ||
Net increase (decrease) in deposits | 24,168 | (123,384) |
Net increase in short-term borrowed funds | 159,900 | |
Net (decrease) increase in long-term borrowed funds | (333,340) | 49,897 |
Tax effect of stock plans | 657 | 1,887 |
Cash dividends paid on common stock | (108,157) | (86,079) |
Treasury stock purchases | (1,706) | (624) |
Net cash received from stock option exercises | 2,573 | 25 |
Proceeds from issuance of common stock, net | 28,935 | |
Net cash (used in) provided by financing activities | (386,870) | 1,622 |
Net decrease in cash and cash equivalents | (122,968) | (35,935) |
Cash and cash equivalents at beginning of period | 2,670,857 | 203,216 |
Cash and cash equivalents at end of period | 2,547,889 | 167,281 |
Supplemental information: | ||
Cash paid for interest | 203,198 | 190,489 |
Cash paid for income taxes | 18,819 | 66,053 |
Non-cash investing and financing activities: | ||
Transfers to other real estate owned from loans | $1,634 | $561 |
Basis of Presentation
Basis of Presentation | |
3 Months Ended
Mar. 31, 2010 | |
Basis of Presentation | Note 1. Basis of Presentation The accompanying unaudited consolidated financial statements include the accounts of New York Community Bancorp, Inc. and subsidiaries (the Company), including its two bank subsidiaries, New York Community Bank (the Community Bank) and New York Commercial Bank (the Commercial Bank). The unaudited consolidated financial statements reflect all normal recurring adjustments that, in the opinion of management, are necessary to present a fair statement of the results for the periods presented. There are no other adjustments reflected in the accompanying consolidated financial statements. The results of operations for the three months ended March31, 2010 are not necessarily indicative of the results of operations that may be expected for all of 2010. Certain information and note disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles (GAAP) have been condensed or omitted, pursuant to the rules and regulations of the Securities and Exchange Commission (the SEC). The unaudited consolidated financial statements include the accounts of the Company and other entities in which the Company has a controlling financial interest. All inter-company balances and transactions have been eliminated. These unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Companys 2009 Annual Report on Form 10-K. Certain reclassifications have been made to the prior-period consolidated financial statements to conform to the current-period presentation. |
Business Combinations
Business Combinations | |
3 Months Ended
Mar. 31, 2010 | |
Business Combinations | Note 2: Business Combinations AmTrust Bank On December4, 2009, the Community Bank acquired certain assets and assumed certain liabilities of AmTrust Bank (AmTrust) from the FDIC in an FDIC-assisted transaction (the AmTrust acquisition). Headquartered in Cleveland, Ohio, AmTrust was a savings bank that operated 29 branches in Ohio, 25 branches in Florida, and 12 branches in Arizona. The purpose of the AmTrust acquisition was to expand the Companys footprint into new markets, and to enhance its funding mix with the acquisition of low-cost core deposits. As part of the Purchase and Assumption Agreement entered into by the Community Bank with the FDIC, the Community Bank entered into loss sharing agreements, in accordance with which the FDIC will cover a substantial portion of any future losses on the acquired loans. The acquired loans that are subject to the loss sharing agreements are collectively referred to as covered loans.Under the terms of the loss sharing agreements, the FDIC is obligated to reimburse the Community Bank for 80% of losses up to $907.0 million and 95% of losses in excess of $907.0 million with respect to the covered loans. In addition, the Community Bank will reimburse the FDIC for 80% of recoveries with respect to losses for which the FDIC paid the Community Bank 80% reimbursement, and for 95% of recoveries with respect to losses for which the FDIC paid the Community Bank 95% reimbursement under the loss sharing agreements. The expected net reimbursements under the loss sharing agreements were recorded as an indemnification asset (an FDIC loss share receivable) at an estimated fair value of $740.0 million on the acquisition date. The loss sharing agreements are subject to the Company following certain servicing procedures, as specified in the loss sharing agreements with the FDIC. Furthermore, the Community Bank has agreed to pay to the FDIC, on January18, 2020 (the True-Up Measurement Date), half of the amount, if positive, calculated as (1)$181,400,000 minus (2)the sum of (a)25% of the asset discount bid made in connection with the AmTrust acquisition; (b)25% of the Cumulative Shared-Loss Payments (as defined below); and (c)the sum of the period servicing amounts for every consecutive twelve-month period prior to, and ending on, the True-Up Measurement Date in respect of each of the shared loss agreements during which the applicable shared loss agreement is in effect (with such period servicing amounts to equal, for any twelve-month period with respect to which each of the shared loss agreements during which such shared loss agreement is in effect, the product of the simple average of the principal amount of shared loss loans and shared loss assets at the beginning and end of such period and 1%). For the purposes of the above calculation, Cumulative Shared-Loss Payments means (i)the aggregate of all of the payments made or payable to the Community Bank under the shared-loss agreements minus (ii)the aggregate of all of the payments made or payable to the FDIC under the shared-loss agreements. These reimbursable losses and recoveries are based on the book value of the relevant loans as determined by |
Stock-Based Compensation
Stock-Based Compensation | |
3 Months Ended
Mar. 31, 2010 | |
Stock-Based Compensation | Note 3. Stock-Based Compensation At March31, 2010, the Company had 4,653,558 shares available for grant as options, restricted stock, or other forms of related rights under the New York Community Bancorp, Inc. 2006 Stock Incentive Plan (the 2006 Stock Incentive Plan). Under the 2006 Stock Incentive Plan, the Company granted 399,500 shares of restricted stock in the three months ended March31, 2010, with an average fair value of $16.29 per share on the date of grant and a vesting period of five years. Compensation and benefits expense related to restricted stock grants is recognized on a straight-line basis over the vesting period, and totaled $2.9 million and $2.5 million, respectively, in the three months ended March31, 2010 and 2009. A summary of activity with regard to restricted stock awards during the three months ended March31, 2010 is presented in the following table: FortheThreeMonths Ended March31, 2010 NumberofShares WeightedAverage Grant Date Fair Value Unvested at January 1, 2010 3,000,824 $13.95 Granted 399,500 16.29 Vested (156,700 ) 15.00 Forfeited Unvested at March 31, 2010 3,243,624 14.19 As of March31, 2010, unrecognized compensation costs relating to unvested restricted stock totaled $39.8 million. This amount will be recognized over a remaining weighted average period of 3.9 years. In addition, the Company had eleven stock option plans at March31, 2010: the 1993 and 1997 New York Community Bancorp, Inc. Stock Option Plans; the 1993 and 1996 Haven Bancorp, Inc. Stock Option Plans; the 1998 Richmond County Financial Corp. Stock Compensation Plan; the T R Financial Corp. 1993 Incentive Stock Option Plan; the Roslyn Bancorp, Inc. 1997 and 2001 Stock-based Incentive Plans; the 1998 Long Island Financial Corp. Stock Option Plan; and the 2003 and 2004 Synergy Financial Group, Inc. Stock Option Plans (all eleven plans collectively referred to as the Stock Option Plans). All stock options granted under the Stock Option Plans expire ten years from the date of grant. Using the modified prospective approach, the Company recognizes compensation costs related to share-based payments at fair value on the date of grant, and recognizes such costs in the financial statements over the vesting period during which the employee provides service in exchange for the award. However, as there were no unvested options at any time during the three months ended March31, 2010 or the year ended December31, 2009, the Company did not record any compensation and benefits expense relating to stock options during these periods. Generally, the Company issues new shares of common stock to satisfy the exercise of options. The Company may also use common stock held in Treasury to satisfy the exercise of options. In such event, the difference between the average cost of Treasury shares and the exercise price is recorded as an adjustment to retained earnings or paid-in capital on the date of exercise. At March31, 2010, there were 12,838,385 stock options outstanding. The number of shares available for future issuance under the Stock Option Plans wa |
Securities
Securities | |
3 Months Ended
Mar. 31, 2010 | |
Securities | Note 4. Securities The following tables summarize the Companys portfolio of securities available for sale at March31, 2010 and December31, 2009: March31,2010 (in thousands) Amortized Cost Gross Unrealized Gain Gross Unrealized Loss Fair Value Mortgage-Related Securities: GSE certificates(1) $ 243,712 $ 7,307 $ 433 $ 250,586 GSE CMOs(2) 336,961 13,993 350,954 Private label CMOs 82,325 3,953 78,372 Total mortgage-related securities $ 662,998 $ 21,300 $ 4,386 $ 679,912 Other Securities: U.S. Treasury obligations $ 292,580 $ 51 $ 210 $ 292,421 GSE debentures 19,700 15 19,715 Corporate bonds 5,810 8 802 5,016 State, county, and municipal 6,403 33 214 6,222 Capital trust notes 38,754 7,482 5,321 40,915 Preferred stock 31,400 951 10,978 21,373 Common stock 43,477 1,703 6,458 38,722 Total other securities $ 438,124 $ 10,243 $ 23,983 $ 424,384 Total securities available for sale(3) $ 1,101,122 $ 31,543 $ 28,369 $ 1,104,296 (1) Government-sponsored enterprises (2) Collateralized mortgage obligations (3) As of March31, 2010, the non-credit portion of OTTI recorded in accumulated other comprehensive loss, net of tax (AOCL) was $512,000 (before taxes). December31, 2009 (in thousands) Amortized Cost Gross Unrealized Gain Gross Unrealized Loss Fair Value Mortgage-Related Securities: GSE certificates $ 264,769 $ 7,741 $ 702 $ 271,808 GSE CMOs 400,770 16,013 416,783 Private label CMOs 91,612 5,998 85,614 Total mortgage-related securities $ 757,151 $ 23,754 $ 6,700 $ 774,205 Other Securities: U.S. Treasury obligations $ 607,022 $ 21 $ 592 $ 606,451 GSE debentures 30,179 11 30,190 Corporate bonds 5,811 9 919 4,901 State, county, and municipal 6,402 38 281 6,159 Capital trust notes 39,151 5,125 5,438 38,838 Preferred stock 31,400 1,117 11,283 21,234 Common stock 42,693 1,606 7,631 36,668 Total other securities $ 762,658 $ 7,927 $ 26,144 $ 744,441 Total securities available for sale $ 1,519,809 $ 31,681 $ 32,844 $ 1,518,646 The following tables summarize the Companys portfolio of securities held to maturity at March31, 2010 and December31, 2009: March 31, 2010 (in thousands) Amortized Cost Carrying Amount(1) Gross Unrealized Gain Gross Unrealized Loss Fair Value Mortgage-Related Securities: |
Loans, net
Loans, net | |
3 Months Ended
Mar. 31, 2010 | |
Loans, net | Note 5. Loans, net The following table provides a summary of the Companys loan portfolio at the dates indicated: March31, 2010 December31, 2009 (dollars in thousands) Amount Percent of Non-Covered Loans Amount Percent of Non-Covered Loans Non-Covered Loans: Mortgage Loans: Multi-family $ 16,777,137 69.36 % $ 16,737,721 71.59 % Commercial real estate 5,066,793 20.95 4,988,649 21.34 Acquisition, development, and construction 648,068 2.68 666,440 2.85 One- to four-family 200,940 0.83 216,078 0.92 Loans held for sale 764,358 3.16 Total mortgage loans $ 23,457,296 96.98 $ 22,608,888 96.70 Other Loans: Commercial and industrial 623,556 2.58 653,159 2.79 Other loans 107,001 0.44 118,445 0.51 Total other loans 730,557 3.02 771,604 3.30 Total non-covered loans $ 24,187,853 100.00 % $ 23,380,492 100.00 % Net deferred loan origination fees (5,739 ) (3,893 ) Allowance for loan losses (137,443 ) (127,491 ) Total non-covered loans, net 24,044,671 23,249,108 Total Covered Loans 4,759,139 5,016,100 Loans, net $ 28,803,810 $ 28,265,208 Covered loans refer to the loans acquired from the FDIC in the AmTrust and Desert Hills acquisitions, all of which are subject to the previously mentioned loss sharing agreements. At December31, 2009, the balance of covered loans included loans held for sale of $351.3 million. Non-covered loans refer to all loans in the Companys loan portfolio excluding covered loans. Non-Covered Loans Loans Originated for Portfolio The Company is primarily a multi-family mortgage lender, with a significant portion of its loan portfolio collateralized by non-luxury apartment buildings in New York City that are largely rent-controlled and/or rent-stabilized. The Company also originates the following types of loans for portfolio: commercial real estate (CRE) loans, primarily in New York City, Long Island, and New Jersey; and, to a lesser extent, acquisition, development, and construction (ADC) loans and commercial and industrial (CI) loans. ADC loans are primarily originated for multi-family and residential tract projects in New York City and Long Island, while CI loans are made to small and mid-size businesses in New York City, Long Island, New Jersey, and Arizona on both a secured and unsecured basis for working capital, business expansion, and the purchase of machinery and equipment. Payments on multi-family and CRE loans generally depend on the income produced by the underlying properties which, in turn, depends on their successful operation and management. Accordingly, the abi |
Mortgage Servicing Rights
Mortgage Servicing Rights | |
3 Months Ended
Mar. 31, 2010 | |
Mortgage Servicing Rights | Note 6. Mortgage Servicing Rights The Company had mortgage servicing rights (MSRs) of $19.8 million and $10.6 million at March31, 2010 and December31, 2009, respectively. MSRs are included in other assets in the Consolidated Statements of Condition. The Company has two classes of MSRs for which it separately manages the economic risk: residential MSRs and securitized MSRs. Residential MSRs are carried at fair value, with changes in fair value recorded as a component of non-interest income in each period. The Company uses various derivative instruments to mitigate the income statement-effect of changes in fair value due to changes in valuation inputs and assumptions of its residential MSRs. MSRs do not trade in an active, open market with readily observable prices. Accordingly, the Company utilizes a valuation model that calculates the present value of estimated future cash flows. The model incorporates various assumptions, including estimates of prepayment speeds, discount rates, refinance rates, servicing costs, and ancillary income. The Company reassesses and periodically adjusts the underlying inputs and assumptions in the model to reflect market conditions and assumptions that a market participant would consider in valuing the MSR asset. The value of MSRs is significantly affected by mortgage interest rates available in the marketplace, which influence mortgage loan prepayment speeds. In general, during periods of declining interest rates, the value of MSRs declines due to increasing prepayments attributable to increased mortgage refinancing activity. Conversely, during periods of rising interest rates, the value of MSRs generally increases due to reduced mortgage refinancing activity. Securitized MSRs are carried at the lower of the initial carrying value, adjusted for amortization, or fair value and are amortized in proportion to, and over the period of, estimated net servicing income. Such MSRs are periodically evaluated for impairment based on the difference between the carrying amount and current fair value. If it is determined that impairment exists, the resultant loss is charged against earnings. The following table sets forth the changes in residential and securitized MSRs for the three months March31, 2010 and the year ended December31, 2009: For the Three Months Ended March31, 2010 For the Year Ended December31, 2009 (in thousands) Residential Securitized Residential Securitized Carrying value, beginning of year $ 8,617 $ 1,965 $ $ 3,568 Additions 9,353 Increase in fair value 41 Amortization (193 ) (1,603 ) Additions recorded at fair value in the AmTrust acquisition 8,617 Carrying value, end of period $ 18,011 $ 1,772 $ 8,617 $ 1,965 |
Borrowed Funds
Borrowed Funds | |
3 Months Ended
Mar. 31, 2010 | |
Borrowed Funds | Note 7. Borrowed Funds The following table provides a summary of the Companys borrowed funds at the dates indicated: (in thousands) March31, 2010 December31, 2009 Wholesale borrowings: FHLB advances $ 8,670,024 $ 8,955,769 Repurchase agreements 4,125,000 4,125,000 Total wholesale borrowings 12,795,024 13,080,769 Junior subordinated debentures 427,251 427,371 Senior debt 601,775 601,746 Preferred stock of subsidiaries 51,800 54,800 Total borrowed funds $ 13,875,850 $ 14,164,686 At March31, 2010, the Company had $427.3 million of outstanding junior subordinated deferrable interest debentures (junior subordinated debentures) held by nine statutory business trusts (the Trusts) that issued guaranteed capital securities. The capital securities qualified as Tier 1 capital of the Company at that date. The Trusts are accounted for as unconsolidated subsidiaries in accordance with GAAP. The proceeds of each issuance were invested in a series of junior subordinated debentures of the Company and the underlying assets of each statutory business trust are the relevant debentures. The Company has fully and unconditionally guaranteed the obligations under each trusts capital securities to the extent set forth in a guarantee by the Company to each trust. The Trusts capital securities are each subject to mandatory redemption, in whole or in part, upon repayment of the debentures at their stated maturity or earlier redemption. The following table provides a summary of the outstanding capital securities issued by each trust and the carrying amounts of the junior subordinated debentures issued by the Company to each trust as of March31, 2010: Issuer InterestRateof CapitalSecurities and Debentures(1) Junior Subordinated Debenture Carrying Amount Capital Securities Amount Outstanding Date of Original Issue Stated Maturity FirstOptional RedemptionDate (dollars in thousands) Haven Capital Trust II 10.250 % $ 23,333 $ 22,550 May26,1999 June30,2029 June30, 2009(2) Queens County Capital Trust I 11.045 10,309 10,000 July 26, 2000 July 19, 2030 July 19, 2010 QueensStatutoryTrustI 10.600 15,464 15,000 September7,2000 September7,2030 September7,2010 New York Community Capital Trust V 6.000 143,504 137,153 November 4, 2002 November 1, 2051 November4, 2007(3) New York Community Capital Trust X 1.857 123,712 120,000 December14,2006 December15,2036 December15,2011 LIF Statutory Trust I 10.600 7,732 7,500 September 7, 2000 September 7, 2030 September 7, 2010 PennFed Capital Trust II 10.180 12,983 12,611 March 28, 2001 June 8, 2031 June 8, 2011 PennFed Capital Trust III 3.507 30,928 30,000 June 2, 2003 June 15, 2033 June 15, 2008(2) New York Community Capital Trust XI 1.939 59,286 57,500 April 16, 2007 June 30, 2037 June 30, 2012 |
Pension and Other Post-Retireme
Pension and Other Post-Retirement Benefits | |
3 Months Ended
Mar. 31, 2010 | |
Pension and Other Post-Retirement Benefits | Note 8. Pension and Other Post-Retirement Benefits The following table sets forth certain disclosures for the Companys pension and post-retirement plans for the periods indicated: For the Three Months Ended March31, 2010 2009 (in thousands) Pension Benefits Post-Retirement Benefits Pension Benefits Post-Retirement Benefits Components of net periodic (credit) expense: Interest cost $ 1,515 $ 198 $ 1,611 $ 228 Service cost 1 Expected return on plan assets (2,866 ) (2,576 ) Unrecognized past service liability 49 (62 ) 50 (62 ) Amortization of unrecognized loss 1,286 78 1,746 76 Net periodic (credit) expense $ (16 ) $ 215 $ 831 $ 242 As discussed in the notes to the consolidated financial statements presented in the Companys 2009 Annual Report on Form 10-K, the Company expects to contribute $1.7 million to its post-retirement plan to pay premiums and claims for the fiscal year ending December31, 2010. The Company does not expect to contribute to its pension plan in 2010. |
Computation of Earnings per Sha
Computation of Earnings per Share | |
3 Months Ended
Mar. 31, 2010 | |
Computation of Earnings per Share | Note 9. Computation of Earnings per Share The following table presents the Companys computation of basic and diluted earnings per share for the periods indicated: Three Months Ended March31, (in thousands, except share and per share data) 2010 2009 Net income $ 124,149 $ 88,689 Less: Dividends paid on and earnings allocated to participating securities (748 ) (482 ) Earnings applicable to common stock $ 123,401 $ 88,207 Weighted average common shares outstanding 432,131,304 343,323,162 Basic earnings per common share $0.29 $0.26 Earnings applicable to common stock $ 123,401 $ 88,207 Weighted average common shares outstanding 432,131,304 343,323,162 Potential dilutive common shares(1) 315,370 77,847 Total shares for diluted earnings per share computation 432,446,674 343,401,009 Diluted earnings per common share and common share equivalents $0.29 $0.26 (1) Options to purchase 5,310,729 shares and 13,127,433 shares of the Companys common stock that were outstanding as of March31, 2010 and 2009, at respective weighted average exercise prices of $17.72 and $15.73, were not included in the respective computations of diluted earnings per share because their inclusion would have had an antidilutive effect. |
Fair Value Measurement
Fair Value Measurement | |
3 Months Ended
Mar. 31, 2010 | |
Fair Value Measurement | Note 10. Fair Value Measurement In 2008, the FASB issued a standard that, among other things, defined fair value, established a consistent framework for measuring fair value, and expanded disclosure for each major asset and liability category measured at fair value on either a recurring or non-recurring basis. The standard clarified that fair value is an exit price, representing the amount that would be received when selling an asset, or paid when transferring a liability, in an orderly transaction between market participants. Fair value is thus a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, the standard established a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: Level 1 Inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 2 Inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. Level 3 Inputs to the valuation methodology are significant unobservable inputs that reflect a companys own assumptions about the assumptions that market participants use in pricing an asset or liability. A financial instruments categorization within this valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The following tables present assets and liabilities that were measured at fair value on a recurring basis as of March31, 2010 and December31, 2009, and that were included in the Companys Consolidated Statement of Condition at those dates: Fair Value Measurements at March31, 2010 Using (in thousands) QuotedPrices in Active Markets for IdenticalAssets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Netting Adjustments(1 ) Total Fair Value Mortgage-Related Securities Available for Sale: GSE certificates $ $ 350,954 $ $ $ 350,954 GSE CMOs 250,586 250,586 Private label CMOs 78,372 78,372 Total mortgage-related securities $ $ 679,912 $ $ $ 679,912 Other Securities Available for Sale: GSE debentures $ $ 19,715 $ $ $ 19,715 Corporate bonds 5,016 5,016 U. S. Treasury obligations 292,421 292,421 State, county, and municipal 6,222 6,222 Capital trust notes 15,418 25,497 40,915 Preferred stock 13,401 7,972 21,373 Common stock 38,722 38,722 |
Derivative Financial Instrument
Derivative Financial Instruments | |
3 Months Ended
Mar. 31, 2010 | |
Derivative Financial Instruments | Note 11: Derivative Financial Instruments The Companys derivative financial instruments consist of financial forward and futures contracts, interest rate lock commitments, swaps, and options. These derivatives relate to mortgage banking operations, MSRs, and other risk management activities, and seek to mitigate or reduce the Companys exposure to losses from adverse changes in interest rates.These activities will vary in scope based on the level and volatility of interest rates, the type of assets held, and other changing market conditions. The Company held derivatives not designated as hedges with a notional amount of $2.4 billion at March31, 2010. Changes in the fair value of these derivatives are reflected in current-period earnings. The following table sets forth information concerning the Companys derivative financial instruments at March31, 2010: March31, 2010 (in thousands) Notional Amount Fair Value(1) Gain Loss Derivatives Not Designated as Hedges: Mortgage banking: Treasury options $ 55,000 $ 215 $ Eurodollar futures 300,000 433 Forward commitments to sell loans/mortgage-backed securities 1,257,000 5,045 Forward commitments to buy loans/mortgage-backed securities 50,000 344 Interest rate lock commitments 751,913 1,596 Total derivatives $ 2,413,913 $ 6,856 $ 777 (1) Derivatives in a net gain position are recorded as other assets and derivatives in a net loss position are recorded as other liabilities in the Consolidated Statements of Condition. The Company uses various financial instruments, including derivatives, in connection with its strategies to reduce price risk resulting from changes in interest rates. Derivative instruments may include interest rate lock commitments entered into with borrowers or correspondents/brokers to acquire conforming fixed and adjustable rate residential mortgage loans that will be held for sale. Other derivative instruments include Treasury options and Eurodollar futures. Gains or losses due to changes in the fair value of derivatives are recognized currently in earnings. The Company enters into forward contracts to sell fixed rate mortgage-backed securities to protect against changes in the prices of conforming fixed rate loans held for sale. Forward contracts are entered into with securities dealers in an amount related to the portion of interest rate lock commitments that are expected to close. The value of these forward sales contracts moves inversely with the value of the loans in response to changes in interest rates. To manage the price risk associated with fixed rate non-conforming mortgage loans, the Company generally enters into forward contracts on mortgage-backed securities or forward commitments to sell loans to approved investors. Short positions in Eurodollar futures contracts are used to manage price risk on adjustable rate mortgage loans held for sale. The Company also purchases put and call options to manage the risk associated with variations in the amount |
Impact of Recent Accounting Pro
Impact of Recent Accounting Pronouncements | |
3 Months Ended
Mar. 31, 2010 | |
Impact of Recent Accounting Pronouncements | Note 12. Impact of Recent Accounting Pronouncements In January 2010, the FASB issued a standard that requires more robust disclosures about (1)the different classes of assets and liabilities measured at fair value, (2)the valuation techniques and inputs used, (3)the activity in Level 3 fair value measurements, and (4)the transfers between Levels 1, 2, and 3. The new disclosures and clarifications of existing disclosures are effective for interim and annual reporting periods beginning after December15, 2009, except for the disclosures about purchases, sales, issuances, and settlements in the roll-forward of activity in Level 3 fair value measurements. Those disclosures are effective for fiscal years beginning after December15, 2010, and for interim periods within those fiscal years. In July 2009, the FASB released the Codification as the single source of authoritative non-governmental GAAP. The Codification is effective for interim and annual periods ended after September15, 2009. All previously existing accounting standards documents are superseded. All other accounting literature not included in the Codification is non-authoritative. Rules and interpretive releases of the SEC under authority of federal securities laws are also sources of authoritative GAAP for SEC registrants. The Codification supersedes all existing non-SEC accounting and reporting standards. All other non-grandfathered, non-SEC accounting literature not included in the Codification has become non-authoritative. Following the Codification, the FASB will not issue new standards in the form of Statements of Financial Accounting Standards, FASB Staff Positions, Emerging Issues Task Force Abstracts, or other types of pronouncements previously used. Instead, it will issue Accounting Standards Updates (ASUs), which will serve to update the Codification, provide background information about the guidance, and provide the basis for conclusions on changes to the Codification. GAAP is not intended to be changed as a result of the Codification, but the Codification will change the way the guidance is organized and presented. As a result, these changes will have a significant impact on how companies reference GAAP in their financial statements and in their accounting policies for financial statements issued for interim and annual periods ended after September15, 2009. In April 2009, the FASB issued new requirements regarding disclosure of fair value measurements and accounting for the impairment of securities. The requirements address fair value measurements in inactive markets consistent with the principles presented in previously issued standards; increase the frequency of fair value disclosures; and establish new principles with respect to accounting for, and presenting, impairment losses on securities. These requirements address the determination of fair values when there is no active market or where the price inputs being used represent distressed sales, and reaffirm that the objective of fair value measurement, as set forth in previously issued guidance, is to reflect how much an asset would be sold for in an orderly transaction (the exit price, as opposed |