FOR IMMEDIATE RELEASE
Contact: | Peter J. Cunningham |
| | First Vice President, Investor Relations |
| | (516) 327-7877 |
| | ir@astoriafederal.com |
ASTORIA FINANCIAL CORPORATION ANNOUNCES SECOND QUARTER EPS OF $0.37
Margin Increases 24 Basis Points from First Quarter
Quarterly Cash Dividend of $0.26 Per Share Declared
Lake Success, New York, July 16, 2008 -- Astoria Financial Corporation (NYSE: AF) (“Astoria,” the “Company”), the holding company for Astoria Federal Savings and Loan Association (“Astoria Federal”), today reported net income of $33.5 million, or $0.37 diluted earnings per share (“EPS”), for the quarter ended June 30, 2008, compared to $34.1 million, or $0.37 EPS, for the 2007 second quarter. For the six months ended June 30, 2008, net income totaled $62.4 million, or $0.69 EPS, compared to $69.8 million, or $0.75 EPS, for the comparable 2007 period.
Second Quarter 2008 Financial Highlights:
| ● | Diluted earnings per share of $0.37, up 16% from the 2008 first quarter |
| ● | Margin increased 24 basis points from the linked quarter to 1.81% |
| ● | Deposits increased $86 million, or 3% annualized |
| ● | Loan portfolio increased $479 million, or 12% annualized |
| m | One-to-four family loan portfolio increased $550 million, or 20% annualized |
| ● | Mortgage loan production increased $892 million from the 2008 first quarter and totaled $1.6 billion |
| m | One-to-four family loan production increased $833 million from the 2008 first quarter and totaled $1.5 billion |
Commenting on the 2008 second quarter results, George L. Engelke, Jr., Chairman and Chief Executive Officer of Astoria, noted, “We are pleased to report solid second quarter results which reflect double-digit increases in both earnings and earnings per share over the 2008 first quarter. As anticipated, these very positive results were achieved due to a significant improvement in the net interest margin, resulting primarily from lower liability costs, solid loan and deposit growth and lower premium amortization expense. We expect continued expansion in the net interest margin, as well as loan and deposit growth.”
Board Declares Quarterly Cash Dividend of $0.26 Per Share
The Board of Directors of the Company, at their July 16, 2008 meeting, declared a quarterly cash dividend of $0.26 per common share. The dividend is payable on September 2, 2008 to shareholders of record as of August 15, 2008. This is the fifty-third consecutive quarterly cash dividend declared by the Company.
Second Quarter and Six Month Earnings Summary
Net interest income for the quarter ended June 30, 2008 increased $11.8 million, or 15%, from the 2008 first quarter and $9.7 million, or 12%, from the 2007 second quarter to $92.6 million. For the six months ended June 30, 2008, net interest income increased $2.9 million, compared to the six months ended June 30, 2007, to $173.4 million.
Astoria’s net interest margin for the quarter ended June 30, 2008 increased 24 basis points from the 2008 first quarter and 19 basis points from the 2007 second quarter to 1.81%. The increases were primarily due to a decrease in the cost of interest bearing-liabilities. “We expect that the net interest margin will continue to expand this year, as we realize the repricing benefit of deposit and borrowing liabilities which have rates that are considerably above current market rates. Over the next six months, CDs (excluding Liquid CDs) totaling $3.7 billion, with a weighted average rate of 4.29%, and medium and long-term borrowings totaling $1.3 billion, with a weighted average rate of 4.95%, are scheduled to mature,” Mr. Engelke noted.
For the quarter ended June 30, 2008, a $7.0 million provision for loan losses was recorded compared to $4.0 million for the previous quarter. For the six months ended June 30, 2008, provision for loan losses totaled $11.0 million. No provision for loan losses was recorded in the comparable 2007 periods. Quarterly provisions for the remainder of 2008 are expected to remain at or increase somewhat from the second quarter level.
General and administrative expense (“G&A”) for the quarter ended June 30, 2008 increased $1.8 million, to $60.0 million, from the 2008 first quarter and $1.3 million from the 2007 second quarter. The linked quarter increase is primarily due to increases in advertising and goodwill litigation expense. The year over year increase is due primarily to increases in compensation and benefits and real estate owned (REO) expense, partially offset by lower goodwill litigation expense.
For the six months ended June 30, 2008, G&A expense increased $2.4 million, compared to the six months ended June 30, 2007, to $118.2 million. The increase was primarily due to an increase in compensation and benefits expense, partially offset by a decrease in advertising expense.
Balance Sheet Summary
For the quarter and six months ended June 30, 2008, the total loan portfolio increased $478.8 million and $25.4 million, respectively, to $16.2 billion. The loan growth was funded primarily with excess liquidity and, to a lesser extent, retail deposits and wholesale borrowings. Total loan production for the quarter and six months ended June 30, 2008 increased to $1.6 billion and $2.4 billion, respectively, from $1.4 billion and $2.3 billion, respectively, for the comparable 2007 periods.
For the quarter and six months ended June 30, 2008, the one-to-four family mortgage loan portfolio increased $550.4 million and $197.7 million, respectively, to $11.8 billion. One-to-four family loan originations and purchases for the quarter and six months ended June 30, 2008 increased to $1.5 billion and $2.2 billion, respectively, from $1.3 billion and $2.0 billion, respectively, for the comparable 2007 periods. One-to-four family loan prepayments for the quarter and six months ended June 30, 2008 totaled $821.3 million and $1.7 billion, respectively, compared to $583.1 million and $1.1 billion, respectively, for the comparable 2007 periods.
Indicative of Astoria’s conservative underwriting standards, the loan-to-value (“LTV”) ratio of the 2008 second quarter and six month one-to-four family loan production for portfolio averaged approximately 57% for each period and the loan amounts averaged approximately $690,000 and $675,000, respectively. “It is important to note that the double-digit linked quarter loan growth attained in the second quarter has been achieved without sacrificing asset quality, as reflected in the very low average LTV ratio on second quarter loan production,” Mr. Engelke noted.
For the quarter and six months ended June 30, 2008, the multi-family and commercial real estate (“CRE”) loan portfolio decreased $60.1 million and $132.0 million, respectively. Multi-family/CRE loan originations totaled $126.6 million and $193.8 million, for the respective three and six month periods ended June 30, 2008. At June 30, 2008, the combined multi-family and CRE loan portfolio totaled $3.8 billion, or 24% of total loans. The loan-to-value ratio of the 2008 second quarter and six-month multi-family/CRE loan production averaged approximately 62% for each period and the loan amounts averaged approximately $2.0 million and $1.8 million, respectively.
Asset Quality
Asset quality continued to remain strong during the 2008 second quarter. Non-performing loans (“NPL”) totaled $128.6 million at June 30, 2008, an increase of $22.0 million from the previous quarter, and represent just 0.59% of total assets. At June 30, 2008, one-to-four family non-performing loans totaled $101.0 million and multi-family/CRE non-performing loans totaled $24.5 million, compared to $88.4 million and $14.9 million, respectively, at March 31, 2008.
The comparative table below illustrates loan migration from 30 days delinquent to 90+ days delinquent:
(In millions) | 30-59 Days Past Due | 60-89 Days Past Due | 90 + Days Past Due (NPL) | Total 30 + Days Past Due |
| At December 31, 2007 | $144.4 | $39.1 | $ 68.1 | $251.6 |
| At March 31, 2008 | $136.3 | $48.8 | $106.6 | $291.7 |
| At June 30, 2008 | $134.5 | $51.0 | $128.6 | $314.1 |
The table below details, as of June 30, 2008, the states with a total of 1% or more of our one-to four-family loan portfolio and the respective non-performing loan totals in those states:
(In millions) State | Total 1-4 Family Loans | % of 1-4 Family Loan Portfolio | Total 1-4 Family NPLs | NPLs as % of State Total |
| New York Metro* | $ 4,947.8 | 42% | $33.3 | 0.67% |
| California | $ 1,420.8 | 12% | $ 8.9 | 0.63% |
| Illinois | $ 1,248.2 | 11% | $10.3 | 0.83% |
| Virginia | $ 955.3 | 8% | $13.4 | 1.40% |
| Maryland | $ 859.4 | 7% | $13.2 | 1.54% |
| Massachusetts | $ 798.9 | 7% | $ 4.7 | 0.59% |
| Florida | $ 333.9 | 3% | $ 8.5 | 2.55% |
| Washington | $ 208.7 | 2% | $ 0.0 | 0.00% |
| Georgia | $ 170.1 | 1% | $ 0.6 | 0.35% |
| Washington D.C. | $ 129.4 | 1% | $ 2.5 | 1.93% |
| Pennsylvania | $ 129.3 | 1% | $ 1.5 | 1.16% |
Total States 1% or More | $11,201.8 | 95% | $96.9 | 0.87% |
| Other States | 624.2 | 5% | $ 4.1 | 0.66% |
Total 1-4 Family Portfolio | $11,826.0 | 100% | $101.0 | 0.85% |
| * NY, NJ, CT | | | | |
Net loan charge-offs for the quarter and six months ended June 30, 2008 totaled $5.2 million and $8.1 million, respectively, compared to net loan charge-offs of $698,000 and $543,000, respectively, for the 2007 comparable periods. For the quarter and six months ended June 30, 2008, one-to-four family net loan charge-offs totaled $3.7 million and $4.9 million, respectively.
Commenting on asset quality, Mr. Engelke noted, “Although we have never actively participated in high-risk sub-prime residential lending, as a geographically diversified residential lender, we are not immune to the negative consequences arising from overall economic weakness and, in particular, a sharp downturn in the housing industry nationally. As expected, non-performing loans and charge-offs increased somewhat in the second quarter. However, the growth in non-performing loans has slowed from the previous quarter and importantly the trend in 30-59 day loan delinquencies has been relatively stable and down slightly over the past two quarters, as reflected in the delinquency chart on the previous page. Our overall asset quality remains strong, with non-performing loans representing just 59 basis points of total assets.”
Balance Sheet Summary (Continued)
Deposits increased $85.5 and $39.6 million for the quarter and six months ended June 30, 2008 and totaled $13.1 billion. Total assets increased $165.9 million from the previous quarter to $21.6 billion at June 30, 2008.
Key balance sheet highlights, reflecting the improvement in the quality of the Company’s balance sheet since December 31, 1999, follow:
| ($ in millions) | 12/31/99 | 12/31/01 | 12/31/03 | 12/31/05 | 12/31/07 | 6/30/08 | Cumulative % Change |
Assets | $22,700 | $22,672 | $22,462 | $22,380 | $21,719 | $21,620 | ( 5%) |
Loans | $10,286 | $12,167 | $12,687 | $14,392 | $16,155 | $16,180 | + 57% |
Securities | $10,763 | $ 8,013 | $ 8,448 | $ 6,572 | $ 4,371 | $ 4,204 | (61%) |
Deposits | $ 9,555 | $10,904 | $11,187 | $12,810 | $13,049 | $13,089 | + 37% |
Borrowings | $11,528 | $ 9,826 | $ 9,632 | $ 7,938 | $ 7,185 | $ 6,938 | (40%) |
The following table illustrates the above improvement on an outstanding per share basis:
Amount per share | 12/31/99 | 12/31/01 | 12/31/03 | 12/31/05 | 12/31/07 | 6/30/08 | % Change | CAGR |
Loans | $ 66.28 | $ 89.36 | $107.51 | $137.11 | $168.76 | $168.66 | 154% | 12% |
Deposits | $ 61.57 | $ 80.09 | $ 94.80 | $122.04 | $136.32 | $136.44 | 122% | 10% |
Twelfth Stock Repurchase Program Continues
During the 2008 second quarter, Astoria repurchased 300,000 shares of its common stock at an average cost of $23.96 per share. During the six month period ended June 30, 2008, Astoria repurchased a total of 590,000 shares at an average cost of $24.74. Under the current stock repurchase program, 8.3 million shares remain available for repurchase as of June 30, 2008.
Stockholders’ equity was $1.2 billion, or 5.66% of total assets at June 30, 2008. Astoria Federal continues to maintain capital ratios in excess of regulatory requirements with core, tangible and risk-based capital ratios of 6.63%, 6.63% and 12.17%, respectively, at June 30, 2008.
Future Outlook
Commenting on the outlook for the remainder of 2008, Mr. Engelke stated, “We continue to anticipate a positively sloped yield curve throughout the year which will provide opportunities for significant earnings growth and the continued expansion of our net interest margin. In addition, we expect both loan and deposit growth will continue, particularly since we are experiencing more rational deposit pricing in our market. Although we expect our credit costs will continue to trend somewhat higher, such increases will be more than offset by margin expansion. The Company’s tangible capital ratio target remains between 4.50% and 4.75%.”
Astoria Financial Corporation, with assets of $21.6 billion, is the holding company for Astoria Federal Savings and Loan Association. Established in 1888, Astoria Federal, with deposits in New York totaling $13.1 billion, is the largest thrift depository headquartered in New York and embraces its philosophy of “Putting people first” by providing the customers and local communities it serves with quality financial products and services through 86 convenient banking office locations and multiple delivery channels, including its enhanced website, www.astoriafederal.com. Astoria Federal commands the fourth largest deposit market share in the attractive Long Island market, which includes Brooklyn, Queens, Nassau, and Suffolk counties with a population exceeding that of 38 individual states. Astoria Federal originates mortgage loans through its banking and loan production offices in New York, an extensive broker network covering twenty-two states, primarily the East Coast, and the District of Columbia, and through correspondent relationships covering twenty-nine states and the District of Columbia.
Earnings Conference Call July 17, 2008 at 10:00 a.m. (ET)
The Company, as previously announced, indicated that Mr. Engelke will host an earnings conference call Thursday morning, July 17, 2008 at 10:00 a.m. (ET). The toll-free dial-in number is (888) 562-3356, conference ID # 50458495. A telephone replay will be available on July 17, 2008 from 1:00 p.m. (ET) through Friday, July 25, 2008, 11:59 p.m. (ET). The replay number is (800) 642-1687, ID # 50458495. The conference call will also be simultaneously webcast on the Company’s website www.astoriafederal.com and archived for one year.
Forward Looking Statements
This document contains a number of forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements may be identified by the use of such words as “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “outlook,” “plan,” “potential,” “predict,” “project,” “should,” “will,” “would,” and similar terms and phrases, including references to assumptions.
Forward-looking statements are based on various assumptions and analyses made by us in light of our management’s experience and its perception of historical trends, current conditions and expected future developments, as well as other factors we believe are appropriate under the circumstances. These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors (many of which are beyond our control) that could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. These factors include, without limitation, the following: the timing and occurrence or non-occurrence of events may be subject to circumstances beyond our control; there may be increases in competitive pressure among financial institutions or from non-financial institutions; changes in the interest rate environment may reduce interest margins or affect the value of our investments; changes in deposit flows, loan demand or real estate values may adversely affect our business; changes in accounting principles, policies or guidelines may cause our financial condition to be perceived differently; general economic conditions, either nationally or locally in some or all of the areas in which we do business, or conditions in the real estate or securities markets or the banking industry may be less favorable than we currently anticipate; legislative or regulatory changes may adversely affect our business; applicable technological changes may be more difficult or expensive than we anticipate; success or consummation of new business initiatives may be more difficult or expensive than we anticipate; or litigation or matters before regulatory agencies, whether currently existing or commencing in the future, may be determined adverse to us or may delay the occurrence or non-occurrence of events longer than we anticipate. We assume no obligation to update any forward-looking statements to reflect events or circumstances after the date of this document.
ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES |
| | | | | | | | |
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION |
| (In Thousands, Except Share Data) |
| | | At | | At | |
| | June 30, | | December 31, | |
| | 2008 | | 2007 | |
ASSETS | | | | | |
| Cash and due from banks | | $ | 82,224 | | $ | 93,972 | |
| Repurchase agreements | | | 42,130 | | | 24,218 | |
| Securities available-for-sale | | | 1,305,274 | | | 1,313,306 | |
| Securities held-to-maturity | | | | | | | |
| (fair value of $2,861,882, and $3,013,014, respectively) | | | 2,898,255 | | | 3,057,544 | |
| Federal Home Loan Bank of New York stock, at cost | | | 200,260 | | | 201,490 | |
| Loans held-for-sale, net | | | 10,465 | | | 6,306 | |
| Loans receivable: | | | | | | | |
| Mortgage loans, net | | | 15,840,358 | | | 15,791,962 | |
| Consumer and other loans, net | | | 340,018 | | | 363,052 | |
| | | | 16,180,376 | | | 16,155,014 | |
| Allowance for loan losses | | | (81,843 | ) | | (78,946 | ) |
| Total loans receivable, net | | | 16,098,533 | | | 16,076,068 | |
| Mortgage servicing rights, net | | | 12,816 | | | 12,910 | |
| Accrued interest receivable | | | 78,651 | | | 79,132 | |
| Premises and equipment, net | | | 140,161 | | | 139,563 | |
| Goodwill | | | 185,151 | | | 185,151 | |
| Bank owned life insurance | | | 397,170 | | | 398,280 | |
| Other assets | | | 168,981 | | | 131,428 | |
| | | | | | | | |
TOTAL ASSETS | | $ | 21,620,071 | | $ | 21,719,368 | |
| | | | | | | | |
LIABILITIES AND STOCKHOLDERS' EQUITY | | | | | | | |
| Liabilities: | | | | | | | |
| Deposits | | $ | 13,089,046 | | $ | 13,049,438 | |
| Reverse repurchase agreements | | | 3,450,000 | | | 3,730,000 | |
| Federal Home Loan Bank of New York advances | | | 3,091,000 | | | 3,058,000 | |
| Other borrowings, net | | | 396,975 | | | 396,658 | |
| Mortgage escrow funds | | | 141,566 | | | 129,412 | |
| Accrued expenses and other liabilities | | | 227,636 | | | 144,516 | |
| | | | | | | | |
TOTAL LIABILITIES | | | 20,396,223 | | | 20,508,024 | |
| | | | | | | | |
| Stockholders' equity: | | | | | | | |
| Preferred stock, $1.00 par value; (5,000,000 shares authorized; | | | | | | | |
| none issued and outstanding) | | | - | | | - | |
| Common stock, $.01 par value; (200,000,000 shares authorized; | | | | | | | |
| 166,494,888 shares issued; and 95,935,535, and 95,728,562 shares | | | | | | | |
| outstanding, respectively) | | | 1,665 | | | 1,665 | |
| Additional paid-in capital | | | 846,343 | | | 846,227 | |
| Retained earnings | | | 1,898,799 | | | 1,883,902 | |
| Treasury stock (70,559,353 and 70,766,326 shares, at cost, respectively) | | | (1,458,008 | ) | | (1,459,865 | ) |
| Accumulated other comprehensive loss | | | (44,683 | ) | | (39,476 | ) |
| Unallocated common stock held by ESOP | | | | | | | |
| (5,531,986 and 5,761,391 shares, respectively) | | | (20,268 | ) | | (21,109 | ) |
| | | | | | | | |
TOTAL STOCKHOLDERS' EQUITY | | | 1,223,848 | | | 1,211,344 | |
| | | | | | | | |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | | $ | 21,620,071 | | $ | 21,719,368 | |
| | | | | | | | |
ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES |
| | | | | | | | | | | |
CONSOLIDATED STATEMENTS OF INCOME |
| (In Thousands, Except Share Data) |
| | | | | | | | | | | |
| | | | | For the Three Months Ended | | For the Six Months Ended | |
| | | | | June 30, | | June 30, | |
| | | | | 2008 | | 2007 | | 2008 | | 2007 | |
| Interest income: | | | | | | | | | | | |
| Mortgage loans: | | | | | | | | | | | |
| One-to-four family | | | | | | | | $ | | | $ | | | $ | | |
Multi-family, commercial real estate and construction | | | | | | 58,686 | | | 64,438 | | | 119,001 | | | 129,108 | |
| Consumer and other loans | | | | | | 4,177 | | | 7,812 | | | 9,609 | | | 16,006 | |
| Mortgage-backed and other securities | | | | | | 46,708 | | | 55,885 | | | 94,601 | | | 114,900 | |
| Federal funds sold and repurchase agreements | | | | | | 1,018 | | | 499 | | | 1,654 | | | 1,475 | |
| Federal Home Loan Bank of New York stock | | | | | | 3,803 | | | 2,749 | | | 8,025 | | | 5,347 | |
| Total interest income | | | | | | 266,639 | | | 272,951 | | | 538,735 | | | 544,920 | |
| Interest expense: | | | | | | | | | | | | | | | | |
| Deposits | | | | | | 97,851 | | | 114,096 | | | 208,054 | | | 224,454 | |
| Borrowings | | | | | | 76,208 | | | 75,964 | | | 157,315 | | | 150,048 | |
| Total interest expense | | | | | | 174,059 | | | 190,060 | | | 365,369 | | | 374,502 | |
| | | | | | | | | | | | | | | | | |
| Net interest income | | | | | | 92,580 | | | 82,891 | | | 173,366 | | | 170,418 | |
| Provision for loan losses | | | | | | 7,000 | | | - | | | 11,000 | | | - | |
| Net interest income after provision for loan losses | | | | | | 85,580 | | | 82,891 | | | 162,366 | | | 170,418 | |
| Non-interest income: | | | | | | | | | | | | | | | | |
| Customer service fees | | | | | | 16,775 | | | 16,159 | | | 31,909 | | | 31,328 | |
| Other loan fees | | | | | | 1,090 | | | 1,110 | | | 2,129 | | | 2,328 | |
| Mortgage banking income, net | | | | | | 1,575 | | | 1,224 | | | 2,025 | | | 1,840 | |
| Income from bank owned life insurance | | | | | | 4,008 | | | 4,287 | | | 8,397 | | | 8,490 | |
| Other | | | | | | 1,385 | | | 3,500 | | | 2,810 | | | 4,891 | |
| Total non-interest income | | | | | | 24,833 | | | 26,280 | | | 47,270 | | | 48,877 | |
| Non-interest expense: | | | | | | | | | | | | | | | | |
| General and administrative: | | | | | | | | | | | | | | | | |
| Compensation and benefits | | | | | | 32,375 | | | 30,046 | | | 64,366 | | | 61,170 | |
| Occupancy, equipment and systems | | | | | | 16,847 | | | 16,494 | | | 33,751 | | | 33,015 | |
| Federal deposit insurance premiums | | | | | | 548 | | | 407 | | | 1,119 | | | 814 | |
| Advertising | | | | | | 1,550 | | | 1,977 | | | 2,623 | | | 3,892 | |
| Other | | | | | | 8,662 | | | 9,783 | | | 16,352 | | | 16,936 | |
| Total non-interest expense | | | | | | 59,982 | | | 58,707 | | | 118,211 | | | 115,827 | |
| | | | | | | | | | | | | | | | | |
| Income before income tax expense | | | | | | 50,431 | | | 50,464 | | | 91,425 | | | 103,468 | |
| Income tax expense | | | | | | 16,981 | | | 16,400 | | | 29,072 | | | 33,627 | |
| | | | | | | | | | | | | | | | | |
| Net income | | | | | $ | | | $ | | | $ | | | $ | | |
| | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
| Basic earnings per common share | | | | | $ | | | $ | | | $ | | | $ | | |
| | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
| Diluted earnings per common share | | | | | $ | | | $ | | | $ | | | $ | | |
| | | | | | | | | | | | | | | | | |
| Basic weighted average common shares | | | | | | | | | 90,704,749 | | | 89,511,918 | | | 91,062,161 | |
| | | | | | | | | | | | | | | | | |
Diluted weighted average common and common equivalent shares | | | | | | | | | 92,166,978 | | | 90,914,571 | | | 92,864,131 | |
ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES |
| |
SELECTED FINANCIAL RATIOS AND OTHER DATA |
| | | For the | | At or For the | |
| | | Three Months Ended | | Six Months Ended | |
| | | June 30, | | June 30, | |
| | | 2008 | | 2007 | | 2008 | | 2007 | |
| | | | | | | | |
Selected Returns and Financial Ratios (annualized) | | | | | | | | | |
| Return on average stockholders' equity | | | 10.96 | % | | 11.35 | % | | 10.22 | % | | 11.59 | % |
| Return on average tangible stockholders' equity (1) | | | 12.92 | | | 13.42 | | | 12.05 | | | 13.70 | |
| Return on average assets | | | 0.62 | | | 0.63 | | | 0.58 | | | 0.65 | |
| General and administrative expense to average assets | | | 1.12 | | | 1.09 | | | 1.10 | | | 1.08 | |
| Efficiency ratio (2) | | | 51.09 | | | 53.78 | | | 53.58 | | | 52.82 | |
| Net interest rate spread (3) | | | 1.70 | | | 1.50 | | | 1.58 | | | 1.55 | |
| Net interest margin (4) | | | 1.81 | | | 1.62 | | | 1.69 | | | 1.66 | |
| | | | | | | | | | | | | | |
Asset Quality Data (dollars in thousands) (5) | | | | | | | | | | | | | |
| Non-performing assets | | | | | | | | $ | 146,852 | | $ | 51,178 | |
| Non-performing loans | | | | | | | | | 128,603 | | | 49,253 | |
| Loans delinquent 90 days or more and still accruing interest | | | | | | | | | 122 | | | 625 | |
| Non-accrual loans | | | | | | | | | 128,481 | | | 48,628 | |
| Loans 60-89 days delinquent | | | | | | | | | 51,035 | | | 15,669 | |
| Loans 30-59 days delinquent | | | | | | | | | 134,493 | | | 109,395 | |
| Net charge-offs | | $ | 5,240 | | $ | 698 | | | 8,103 | | | 543 | |
| | | | | | | | | | | | | | |
| Non-performing loans/total loans | | | | | | | | | 0.79 | % | | 0.32 | % |
| Non-performing loans/total assets | | | | | | | | | 0.59 | | | 0.23 | |
| Non-performing assets/total assets | | | | | | | | | 0.68 | | | 0.24 | |
| Allowance for loan losses/non-performing loans | | | | | | | | | 63.64 | | | 161.21 | |
| Allowance for loan losses/non-accrual loans | | | | | | | | | 63.70 | | | 163.28 | |
| Allowance for loan losses/total loans | | | | | | | | | 0.51 | | | 0.51 | |
| Net charge-offs to average loans outstanding (annualized) | | | 0.13 | % | | 0.02 | % | | 0.10 | | | 0.01 | |
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Capital Ratios (Astoria Federal) | | | | | | | | | | | | | |
| Tangible | | | | | | | | | 6.63 | % | | 6.65 | % |
| Core | | | | | | | | | 6.63 | | | 6.65 | |
| Risk-based | | | | | | | | | 12.17 | | | 12.19 | |
| | | | | | | | | | | | | | |
Other Data | | | | | | | | | | | | | |
| Cash dividends paid per common share | | $ | 0.26 | | $ | 0.26 | | $ | 0.52 | | $ | 0.52 | |
| Dividend payout ratio | | | 70.27 | % | | 70.27 | % | | 75.36 | % | | 69.33 | % |
| Book value per share (6) | | | | | | | | $ | 13.54 | | $ | 13.15 | |
| Tangible book value per share (7) | | | | | | | | $ | 11.49 | | $ | 11.11 | |
| Tangible stockholders' equity/tangible assets (1) (8) | | | | | | | | | 4.85 | % | | 4.70 | % |
| Mortgage loans serviced for others (in thousands) | | | | | | | | $ | 1,239,745 | | $ | 1,305,916 | |
| Full time equivalent employees | | | | | | | | | 1,643 | | | 1,628 | |
| | | | | | | | | | | | | | |
| | (1) | Tangible stockholders' equity represents stockholders' equity less goodwill. |
| | (2) | Efficiency ratio represents general and administrative expense divided by the sum of net interest income plus non-interest income. |
| | (3) | Net interest rate spread represents the difference between the average yield on average interest-earning assets and the average cost of average interest-bearing liabilities. |
| | (4) | Net interest margin represents net interest income divided by average interest-earning assets. |
| | (5) | Loans totaling $14.7 million have been reclassified from non-accrual to 60-89 days delinquent as of June 30, 2007 to conform the June 30, 2007 information to the current year presentation. The related June 30, 2007 asset quality ratios have been revised as necessary. |
| | (6) | Book value per share represents stockholders' equity divided by outstanding shares, excluding unallocated Employee Stock Ownership Plan, or ESOP, shares. |
| | (7) | Tangible book value per share represents stockholders' equity less goodwill divided by outstanding shares, excluding unallocated ESOP shares. |
| | (8) | Tangible assets represent assets less goodwill. |
ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES |
| |
AVERAGE BALANCE SHEETS |
| (Dollars in Thousands) |
| | | | For the Three Months Ended June 30, | |
| | | | 2008 | | | 2007 | |
| | | | | | | | | | Average | | | | | | | | | Average | |
| | | | Average | | | | | | Yield/ | | | Average | | | | | | Yield/ | |
| | | | Balance | | | Interest | | | Cost | | | Balance | | | Interest | | | Cost | |
| | | | | | | | | | (Annualized) | | | | | | | | | (Annualized) | |
| | | | | | | | | | | | | | | | | | | | |
| Assets: | | | | | | | | | | | | | | | | | | | |
| Interest-earning assets: | | | | | | | | | | | | | | | | | | | |
| Mortgage loans (1): | | | | | | | | | | | | | | | | | | | |
| One-to-four family | | $ | 11,558,547 | | $ | 152,247 | | | 5.27 | % | $ | 10,749,335 | | $ | 141,568 | | | 5.27 | % |
Multi-family, commercial real estate and construction | | | 3,941,587 | | | 58,686 | | | 5.96 | | | 4,200,044 | | | 64,438 | | | 6.14 | |
| Consumer and other loans (1) | | | 345,242 | | | 4,177 | | | 4.84 | | | 406,437 | | | 7,812 | | | 7.69 | |
| Total loans | | | 15,845,376 | | | 215,110 | | | 5.43 | | | 15,355,816 | | | 213,818 | | | 5.57 | |
| Mortgage-backed and other securities (2) | | | 4,234,398 | | | 46,708 | | | 4.41 | | | 4,964,564 | | | 55,885 | | | 4.50 | |
| Federal funds sold and repurchase agreements | | | 183,413 | | | 1,018 | | | 2.22 | | | 37,742 | | | 499 | | | 5.29 | |
| Federal Home Loan Bank stock | | | 194,783 | | | 3,803 | | | 7.81 | | | 155,056 | | | 2,749 | | | 7.09 | |
| Total interest-earning assets | | | 20,457,970 | | | 266,639 | | | 5.21 | | | 20,513,178 | | | 272,951 | | | 5.32 | |
| Goodwill | | | 185,151 | | | | | | | | | 185,151 | | | | | | | |
| Other non-interest-earning assets | | | 844,802 | | | | | | | | | 763,554 | | | | | | | |
| Total assets | | $ | 21,487,923 | | | | | | | | $ | 21,461,883 | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
| Liabilities and stockholders' equity: | | | | | | | | | | | | | | | | | | | |
| Interest-bearing liabilities: | | | | | | | | | | | | | | | | | | | |
| Savings | | $ | 1,884,583 | | | 1,899 | | | 0.40 | | $ | 2,061,648 | | | 2,074 | | | 0.40 | |
| Money market | | | 317,185 | | | 799 | | | 1.01 | | | 391,139 | | | 970 | | | 0.99 | |
| NOW and demand deposit | | | 1,508,664 | | | 319 | | | 0.08 | | | 1,495,582 | | | 214 | | | 0.06 | |
| Liquid certificates of deposit | | | 1,302,494 | | | 8,894 | | | 2.73 | | | 1,659,796 | | | 20,241 | | | 4.88 | |
| Total core deposits | | | 5,012,926 | | | 11,911 | | | 0.95 | | | 5,608,165 | | | 23,499 | | | 1.68 | |
| Certificates of deposit | | | 8,008,650 | | | 85,940 | | | 4.29 | | | 7,724,775 | | | 90,597 | | | 4.69 | |
| Total deposits | | | 13,021,576 | | | 97,851 | | | 3.01 | | | 13,332,940 | | | 114,096 | | | 3.42 | |
| Borrowings | | | 6,802,152 | | | 76,208 | | | 4.48 | | | 6,562,399 | | | 75,964 | | | 4.63 | |
| Total interest-bearing liabilities | | | 19,823,728 | | | 174,059 | | | 3.51 | | | 19,895,339 | | | 190,060 | | | 3.82 | |
| Non-interest-bearing liabilities | | | 443,235 | | | | | | | | | 365,877 | | | | | | | |
| Total liabilities | | | 20,266,963 | | | | | | | | | 20,261,216 | | | | | | | |
| Stockholders' equity | | | 1,220,960 | | | | | | | | | 1,200,667 | | | | | | | |
| Total liabilities and stockholders' equity | | $ | 21,487,923 | | | | | | | | $ | 21,461,883 | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
| Net interest income/net interest | | | | | | | | | | | | | | | | | | | |
| rate spread | | | | | $ | 92,580 | | | 1.70 | % | | | | $ | 82,891 | | | 1.50 | % |
| Net interest-earning assets/net | | | | | | | | | | | | | | | | | | | |
| interest margin$ | | | 634,242 | | | | | | 1.81 | % | $ | 617,839 | | | | | | 1.62 | % |
| | | | | | | | | | | | | | | | | | | | |
Ratio of interest-earning assets to interest-bearing liabilities | | | 1.03x | | | | | | | | | 1.03x | | | | | | | |
| (1) | Mortgage loans and consumer and other loans include loans held-for-sale and non-performing loans and exclude the allowance for loan losses. |
| (2) | Securities available-for-sale are included at average amortized cost. |
ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES
AVERAGE BALANCE SHEETS
(Dollars in Thousands)
| | | For the Six Months Ended June 30, | |
| | | 2008 | | 2007 | |
| | | | | | | Average | | | | | | Average | |
| | | Average | | | | Yield/ | | Average | | | | Yield/ | |
| | | Balance | | Interest | | Cost | | Balance | | Interest | | Cost | |
| | | | | | | (Annualized) | | | | | | (Annualized) | |
| Assets: | | | | | | | | | | | | | | | | | | | |
| Interest-earning assets: | | | | | | | | | | | | | | | | | | | |
| Mortgage loans (1): | | | | | | | | | | | | | | | | | | | |
| One-to-four family | | $ | 11,590,151 | | $ | 305,845 | | | 5.28 | % | $ | 10,568,690 | | $ | 278,084 | | | 5.26 | % |
| Multi-family, commercial real estate and construction | | | 3,973,630 | | | 119,001 | | | 5.99 | | | 4,214,404 | | | 129,108 | | | 6.13 | |
| Consumer and other loans (1) | | | 350,650 | | | 9,609 | | | 5.48 | | | 418,631 | | | 16,006 | | | 7.65 | |
| Total loans | | | 15,914,431 | | | 434,455 | | | 5.46 | | | 15,201,725 | | | 423,198 | | | 5.57 | |
| Mortgage-backed and other securities (2) | | | 4,265,655 | | | 94,601 | | | 4.44 | | | 5,096,922 | | | 114,900 | | | 4.51 | |
| Federal funds sold and repurchase agreements | | | 138,790 | | | 1,654 | | | 2.38 | | | 56,009 | | | 1,475 | | | 5.27 | |
| Federal Home Loan Bank stock | | | 195,449 | | | 8,025 | | | 8.21 | | | 151,880 | | | 5,347 | | | 7.04 | |
| Total interest-earning assets | | | 20,514,325 | | | 538,735 | | | 5.25 | | | 20,506,536 | | | 544,920 | | | 5.31 | |
| Goodwill | | | 185,151 | | | | | | | | | 185,151 | | | | | | | |
| Other non-interest-earning assets | | | 813,624 | | | | | | | | | 760,102 | | | | | | | |
| Total assets | | $ | 21,513,100 | | | | | | | | $ | 21,451,789 | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
| Liabilities and stockholders' equity: | | | | | | | | | | | | | | | | | | | |
| Interest-bearing liabilities: | | | | | | | | | | | | | | | | | | | |
| Savings | | $ | 1,879,370 | | | 3,787 | | | 0.40 | | $ | 2,080,553 | | | 4,161 | | | 0.40 | |
| Money market | | | 320,568 | | | 1,603 | | | 1.00 | | | 406,441 | | | 2,007 | | | 0.99 | |
| NOW and demand deposit | | | 1,477,578 | | | 631 | | | 0.09 | | | 1,480,253 | | | 425 | | | 0.06 | |
| Liquid certificates of deposit | | | 1,363,500 | | | 23,387 | | | 3.43 | | | 1,592,477 | | | 38,777 | | | 4.87 | |
| Total core deposits | | | 5,041,016 | | | 29,408 | | | 1.17 | | | 5,559,724 | | | 45,370 | | | 1.63 | |
| Certificates of deposit | | | 7,950,661 | | | 178,646 | | | 4.49 | | | 7,712,371 | | | 179,084 | | | 4.64 | |
| Total deposits | | | 12,991,677 | | | 208,054 | | | 3.20 | | | 13,272,095 | | | 224,454 | | | 3.38 | |
| Borrowings | | | 6,904,989 | | | 157,315 | | | 4.56 | | | 6,623,738 | | | 150,048 | | | 4.53 | |
| Total interest-bearing liabilities | | | 19,896,666 | | | 365,369 | | | 3.67 | | | 19,895,833 | | | 374,502 | | | 3.76 | |
| Non-interest-bearing liabilities | | | 395,973 | | | | | | | | | 351,122 | | | | | | | |
| Total liabilities | | | 20,292,639 | | | | | | | | | 20,246,955 | | | | | | | |
| Stockholders' equity | | | 1,220,461 | | | | | | | | | 1,204,834 | | | | | | | |
| Total liabilities and stockholders' equity | | $ | 21,513,100 | | | | | | | | $ | 21,451,789 | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
| Net interest income/net interest rate spread | | | | | $ | 173,366 | | | 1.58 | % | | | | $ | 170,418 | | | 1.55 | % |
| Net interest-earning assets/net interest margin | | $ | 617,659 | | | | | | 1.69 | % | $ | 610,703 | | | | | | 1.66 | % |
| Ratio of interest-earning assets to interest-bearing liabilities | | | 1.03x | | | | | | | | | 1.03x | | | | | | | |
| (1) | Mortgage loans and consumer and other loans include loans held-for-sale and non-performing loans and exclude the allowance for loan losses. |
| (2) | Securities available-for-sale are included at average amortized cost. |
ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES
END OF PERIOD BALANCES AND RATES
(Dollars in Thousands)
| | | At June 30, 2008 | | At March 31, 2008 | | At June 30, 2007 | |
| | | | | Weighted | | | | Weighted | | | | Weighted | |
| | | | | Average | | | | Average | | | | Average | |
| | | Balance | | Rate (1) | | Balance | | Rate (1) | | Balance | | Rate (1) | |
| Selected interest-earning assets: | | | | | | | | | | | | | | | | | | | |
| Mortgage loans, gross (2): | | | | | | | | | | | | | | | | | | | |
| One-to-four family | | $ | 11,825,962 | | | 5.64 | % | $ | 11,275,550 | | | 5.69 | % | $ | 10,909,568 | | | 5.58 | % |
| | | | | | | | | | | | | | | | | | | | |
| Multi-family, commercial real estate and construction | | | 3,905,610 | | | 5.90 | | | 3,973,315 | | | 5.89 | | | 4,179,772 | | | 5.94 | |
| Mortgage-backed and other securities (3) | | | 4,203,529 | | | 4.32 | | | 4,256,230 | | | 4.32 | | | 4,787,635 | | | 4.34 | |
| | | | | | | | | | | | | | | | | | | | |
| Interest-bearing liabilities: | | | | | | | | | | | | | | | | | | | |
| Savings | | | 1,886,470 | | | 0.40 | | | 1,878,444 | | | 0.40 | | | 2,025,132 | | | 0.40 | |
| Money market | | | 316,607 | | | 1.02 | | | 321,039 | | | 1.00 | | | 377,455 | | | 1.00 | |
| NOW and demand deposit | | | 1,506,549 | | | 0.06 | | | 1,495,023 | | | 0.06 | | | 1,489,624 | | | 0.06 | |
| Liquid certificates of deposit | | | 1,246,359 | | | 2.47 | | | 1,390,368 | | | 3.42 | | | 1,664,176 | | | 4.83 | |
| Total core deposits | | | 4,955,985 | | | 0.86 | | | 5,084,874 | | | 1.16 | | | 5,556,387 | | | 1.68 | |
| Certificates of deposit | | | 8,133,061 | | | 4.10 | | | 7,918,668 | | | 4.58 | | | 7,891,469 | | | 4.76 | |
| Total deposits | | | 13,089,046 | | | 2.87 | | | 13,003,542 | | | 3.24 | | | 13,447,856 | | | 3.49 | |
| Borrowings, net | | | 6,937,975 | | | 4.28 | | | 6,851,816 | | | 4.55 | | | 6,698,342 | | | 4.62 | |
| (1) | Weighted average rates represent stated or coupon interest rates excluding the effect of yield adjustments for premiums, discounts and deferred loan origination fees and costs and the impact of prepayment penalties. |
| (2) | Mortgage loans exclude loans held-for-sale and include non-performing loans. |
| (3) | Securities available-for-sale are reported at fair value and securities held-to-maturity are reported at amortized cost. |
