Sterling Bancorp 8-K Sterling Bancorp Reports Results for Third Quarter 2006

Exhibit 99.1

650 FIFTH AVENUE
NEW YORK, NY 10019-6108

John Tietjen	Rich Tauberman
Chief Financial Officer	Investor Relations/Media Relations
Sterling Bancorp	MWW Group
john.tietjen@sterlingbancorp.com	rtauberman@mww.com
212.757.8035	201.964.2408

Sterling Bancorp Reports Results for Third Quarter 2006

Gross Revenue and Loan Growth Remained Strong

New York, NY, November 3, 2006 – Sterling Bancorp (NYSE: STL), a financial holding company and the parent company of Sterling National Bank, today reported its financial results for the quarter ended September 30, 2006.

Third Quarter 2006 Highlights – Continuing Operations:

§	Gross revenue (interest income plus noninterest income) rose 9.5% year over year to $39.0 million
§	Period-end loans held in portfolio increased 13.1% from September 30, 2005
§	Demand deposits were 35.3% of total deposits
§	Net interest margin was 4.49%

“The banking industry continues to face a challenging operating environment and is being adversely impacted by higher funding costs and an inverted yield curve. Despite these difficult operating conditions, Sterling reported strong gross revenue and loan growth year over year and continued to maintain a net interest margin among the highest in the industry,” said Louis J. Cappelli, Chairman and Chief Executive Officer.

“Driven by the Company’s loan growth and the higher interest-rate environment, interest income from loans for the third quarter of 2006 rose 22.9% compared to the corresponding period of 2005. Cash flows and sales from Sterling’s investment portfolios have been utilized to fund loan growth and reduce wholesale funding, thereby reducing interest-rate risk and decreasing the Company’s assets by 4.6% year over year.”

“On the deposit side, the Company has continued to exercise deposit pricing discipline. Due to the fact that a large segment of Sterling’s deposit base is comprised of more price-sensitive CDs, the Company’s cost of deposits increased year over year.”

“We are taking aggressive steps to address a demanding, increasingly competitive operating environment. During the quarter, we divested the business conducted by Sterling Financial Services. This strategic initiative, which generated proceeds of more than $100 million, has enabled us to increase liquidity and redeploy resources into

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businesses with greater opportunities for growth; it will also lower cost of funds and reduce operating expenses. We believe that this divesture will have a positive impact on earnings going forward.”

Third Quarter and First Nine Months 2006 Financial Results

Income from Continuing Operations

Income from continuing operations, after income taxes, for the third quarter of 2006 was $5.0 million compared to $6.0 million for the third quarter of 2005. Diluted income per share from continuing operations, after income taxes, for the quarter ended September 30, 2006, was $0.27 compared to $0.30 for the third quarter of 2005.

Income from continuing operations, after income taxes, for the nine months ended September 30, 2006, was $16.9 million compared to $17.1 million for the nine months ended September 30, 2005. Diluted income per share from continuing operations, after income taxes, for the nine months ended September 30, 2006, was $0.88 compared to $0.86 for the nine months ended September 30, 2005.

Net Loss/Income

Sterling previously announced that it had entered into agreements to sell for cash the business conducted by Sterling Financial Services, which included a loan portfolio of approximately $132 million. The Company had expected to record a loss on sale of approximately $8.5 million relating to the transaction against income in the third quarter of 2006. The net after-tax effect of the loss on sale actually amounted to approximately $9.6 million, because the Company could not fully utilize the tax benefit afforded by its real estate investment trust (REIT). The charge was only partially offset by Sterling’s after-tax income from continuing operations, thereby resulting in a net loss for the third quarter of 2006.

The loss from discontinued operations, net of tax, was $0.4 million for the first nine months of 2006, representing $0.02 per share, calculated on a diluted basis, compared to income of $1.0 million, or $0.05 per share, calculated on a diluted basis, for the corresponding period of 2005. The decrease was primarily due to lower net interest income, coupled with a higher provision for loan losses, in the first nine months of 2006 compared to the corresponding period of 2005.

The net loss for the third quarter of 2006 was $4.4 million compared to net income of $6.3 million for the third quarter of 2005. Net loss per share, calculated on a diluted basis, was $0.23 for the quarter ended September 30, 2006, compared to diluted earnings per share of $0.31 for the quarter ended September 30, 2005.

For the nine months ended September 30, 2006, net income was $6.9 million compared to $18.1 million for the corresponding period of 2005. Diluted earnings per share were $0.36 for the nine months ended September 30, 2006, compared to $0.91 for the corresponding period of 2005.

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Net Interest Income

In the third quarter of 2006, net interest income, on a tax-equivalent basis, was $18.6 million compared to $19.3 million in the third quarter of 2005.

For the nine months ended September 30, 2006, net interest income, on a tax-equivalent basis, was $56.6 million, virtually unchanged from the corresponding period of 2005.

Net interest margin for the third quarter of 2006, on a tax-equivalent basis, was 4.49%, compared to 4.55% for the third quarter of 2005.

For the nine-month period ended September 30, 2006, net interest margin, on a tax-equivalent basis, was 4.60% compared to 4.69% for the corresponding period of 2005.

Loans

Period-end loans held in portfolio, net of unearned discount, grew 13.1% to $1,122.2 million from $992.4 million at September 30, 2005.

Demand Deposits

As of September 30, 2006, demand deposits were $507.4 million — 35.3% of total deposits — continuing Sterling’s history of maintaining one of the highest ratios of demand to total deposits in the industry.

Cost of Funds

In the third quarter of 2006, total interest expense from continuing operations was $11.3 million compared to $7.2 million in the third quarter of 2005. The increase was driven primarily by the higher interest-rate environment in 2006. The average rate paid on interest-bearing funds was 3.22% for the third quarter of 2006 compared to 2.46% for the third quarter of 2005.

For the nine months ended September 30, 2006, total interest expense from continuing operations was $30.3 million, compared to $18.6 million for the corresponding period of 2005. For the nine-month period ended September 30, 2006, the average rate paid on interest-bearing funds was 2.92% compared to 2.26% for the corresponding period of 2005.

Noninterest Income and Noninterest Expenses

For the third quarter of 2006, noninterest income from continuing operations was $9.3 million, virtually unchanged from the third quarter of 2005. Higher customer-related service charges and fees were primarily due to revenues attributable to the acquisition of Sterling Resource Funding Corp. Partially offsetting that increase was a decrease in mortgage-banking income principally due to the lower volume of loans sold and the continued yield compression in the secondary market for loans, which is impacting the entire industry.

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Noninterest income from continuing operations for the nine-month period ended September 30, 2006 was $24.0 million compared to $26.2 million for the corresponding period of last year.

Noninterest expenses from continuing operations for the quarter ended September 30, 2006, were $19.5 million compared to $17.2 million for the corresponding period of 2005. The increase was primarily due to investments in the Sterling franchise, including the new branches and the acquisition of Sterling Resource Funding Corp., with higher expenses related to salaries, equipment and occupancy costs. During the third quarter of 2005, noninterest expenses were reduced by $1.0 million due to the recovery of litigation costs originally charged to noninterest expenses in 2001.

For the nine-month period ended September 30, 2006, noninterest expenses from continuing operations were $56.8 million compared to $50.6 million for the first nine months of 2005.

Provision for Income Taxes

The provision for income taxes, based on continuing operations, was $1.8 million for the third quarter of 2006 compared to $3.6 million for the corresponding period of 2005. The decrease was primarily due to the lower level of pre-tax income and to a $0.6 million reversal of state and local taxes, net of federal tax effect, in the 2006 period as a result of the closure of certain years for local tax purposes.

The provision for income taxes, based on continuing operations, for the first nine months of 2006 was $3.1 million, a decrease of $7.1 million from the corresponding period of last year. The decrease was primarily due to a $3.7 million reversal of the reserve for state and local taxes, net of federal tax effect, resulting from the resolution of certain state tax issues in the first quarter of 2006; a $0.6 million reversal of state and local taxes, net of federal tax effect, resulting from of the closure of certain years for local tax purposes in the third quarter of 2006; and the lower level of pre-tax income for the first nine months of 2006.

Asset Quality

The allowance for loan losses as of September 30, 2006, was $16.6 million, or 1.48% of loans held in portfolio, compared to $15.6 million, or 1.57% of loans held in portfolio, as of September 30, 2005.

As of September 30, 2006, nonperforming assets were $6.6 million, representing 0.34% of total assets.

Dividend

On September 30, 2006, Sterling paid a cash dividend of $0.19 per common share to shareholders of record as of September 15, 2006. The Company has distributed cash dividends for over 60 years, 243 consecutive quarters.

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Conference Call

Sterling Bancorp will host a teleconference call for the financial community on Friday, November 3, 2006 at 10:00 a.m. Eastern Time to discuss the third quarter 2006 financial results. The public is invited to listen to this conference call by dialing 866-837-9781 at least 10 minutes prior to the call and entering passcode 993543.

A replay of the conference call will be available at 1:00 p.m. Eastern Time on Friday, November 3, 2006 until 11:59 p.m. Eastern Time on Friday, November 17, 2006. The public is invited to listen to this conference call by dialing 888-266-2081 and entering passcode 993543.

About Sterling Bancorp

Sterling Bancorp (NYSE: STL) is a financial holding company with assets of $1.9 billion, offering a broad array of banking and financial services products. Its principal banking subsidiary is Sterling National Bank, founded in 1929. Sterling provides a wide range of products and services, including business and consumer loans, commercial and residential mortgage lending and brokerage, asset-based financing, factoring and accounts receivable management, trade financing, equipment leasing, corporate and consumer deposit services, trust and estate administration, and investment management services. The Company has operations in New York, New Jersey, Virginia and North Carolina and conducts business throughout the U.S.

Certain statements in this press release, including but not limited to, statements as to future liquidity, redeployment of resources into businesses with greater opportunities for growth, cost of funds and operating expenses and the Company’s belief as to the positive impact of the divestiture of Sterling Financial Services Company, Inc. on the Company’s earnings going forward, statements concerning future results of operations or financial position, and plans and objectives for future operations, and other statements regarding matters that are not historical facts, are “forward-looking statements” as defined in the Securities Exchange Act of 1934. These statements are not historical facts but instead are subject to numerous assumptions, risks and uncertainties, and represent only the Company’s belief regarding future events, many of which, by their nature, are inherently uncertain and outside its control. Any forward-looking statements the Company may make speak only as of the date on which such statements are made. The Company’s actual results and financial position may differ materially from the anticipated results and financial condition indicated in or implied by these forward-looking statements. For a discussion of some of the risks and important factors that could affect the Company’s future results and financial condition, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Forward-Looking Statements and Factors that Could Affect Future Results” in the Company’s Annual Report onForm 10-K for the fiscal year ended December 31, 2005.

- tables to follow-

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STERLING BANCORP
Consolidated Financial Highlights
(Unaudited)
(dollars and shares in thousands, except per share data)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2006			2005			2006			2005
OPERATING HIGHLIGHTS (1)
Interest income	$	29,768		$	26,404		$	86,337		$	74,639
Interest expense		11,276			7,220			30,321			18,635
Provision for loan losses		1,511			1,508			3,253			4,212
Noninterest income		9,252			9,230			24,043			26,239
Noninterest expenses		19,464			17,230			56,792			50,618
Income from continuing operations, after income taxes		5,003			6,029			16,866			17,142
(Loss)/income from discontinued operations, after income taxes		(9,420	)		245			(9,978	)		955
Net (loss)/income		(4,417	)		6,274			6,888			18,097
Income from continuing operations, after income taxes, per common share:
Basic		0.27			0.31			0.90			0.89
Diluted		0.27			0.30			0.88			0.86
Net (loss)/income per common share:
Basic		(0.23	)		0.32			0.37			0.94
Diluted		(0.23	)(2)		0.31			0.36			0.91
Cash dividends declared		0.19			0.18			0.57			0.54
Common shares outstanding:
Period end		18,712			19,210			18,712			19,210
Average Basic		18,712			19,230			18,752			19,210
Average Diluted		19,231			19,852			19,275			19,807
Return on average assets (3)		1.08	%		1.29	%		1.22	%		1.27	%
Return on average tangible equity (4)		16.23	%		18.16	%		18.46	%		17.75	%
Return on average stated equity (5)		13.66	%		15.65	%		15.57	%		15.25	%
Net interest spread, tax-equivalent basis		4.02	%		3.84	%		4.18	%		3.99	%
Net interest margin, tax-equivalent basis		4.49	%		4.55	%		4.60	%		4.69	%
ASSET QUALITY HIGHLIGHTS (1)
Period End
Net charge-offs	$	2,147		$	1,121		$	3,884		$	3,070
Nonperforming loans		4,539			3,337			4,539			3,337
Other real estate owned		2,053			327			2,053			327
Nonperforming assets		6,592			3,664			6,592			3,664
Nonperforming loans/loans (6)		0.39	%		0.32	%		0.39	%		0.32	%
Nonperforming assets/assets		0.34	%		0.19	%		0.34	%		0.19	%
Allowance for loan losses/loans (7)		1.48	%		1.57	%		1.48	%		1.57	%
Allowance for loan losses/ nonperforming loans		365.37	%		466.86	%		365.37	%		466.86	%

(1)	Unless otherwise indicated, all amounts and ratios are presented based on continuing operations.
(2)	Due to a loss for the period, zero incremental shares are included because the effect would be antidilutive.
(3)	Calculated by dividing income from continuing operations by average assets from continuing operations.
(4)	Average tangible equity represents average shareholders’ equity less average goodwill. Calculated by dividing income from continuing operations by average tangible equity.
(5)	Average stated equity is equal to average shareholders’ equity. Calculated by dividing income from continuing operations by average stated equity.
(6)	The term “loans” includes loans held for sale and loans held in portfolio.
(7)	The term “loans” includes loans held in portfolio only.

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STERLING BANCORP
Consolidated Financial Highlights
(Unaudited)
(dollars in thousands, except per share data)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2006			2005			2006			2005
BALANCE SHEET HIGHLIGHTS
Period End Balances (1)
Security investments	$	606,428		$	707,011		$	606,428		$	707,011
Loans held for sale		30,048			50,137			30,048			50,137
Loans held in portfolio, net of unearned discount		1,122,197			992,445			1,122,197			992,445
Total earning assets		1,760,021			1,752,679			1,760,021			1,752,679
Allowance for loan losses		16,584			15,579			16,584			15,579
Total assets from continuing operations		1,934,652			1,926,047			1,934,652			1,926,047
Total assets		1,941,215			2,035,131			1,941,215			2,035,131
Demand deposits		507,367			540,030			507,367			540,030
Savings, NOW and money market deposits		404,954			411,801			404,954			411,801
Time deposits		523,122			525,661			523,122			525,661
Customer repurchase agreements		59,092			57,920			59,092			57,920
Shareholders’ equity (2)		141,028			153,451			141,028			153,451
Average Balances (1)
Security investments	$	629,303		$	719,760		$	666,249		$	715,482
Loans held for sale		34,664			68,492			41,885			53,142
Loans held in portfolio, net of unearned discount		1,016,837			909,647			976,991			869,991
Total earning assets		1,684,128			1,708,289			1,689,969			1,655,425
Total assets from continuing operations		1,840,319			1,854,974			1,847,810			1,801,579
Total assets		1,948,800			1,964,117			1,959,486			1,911,881
Demand deposits		424,834			461,418			436,006			448,038
Savings, NOW and money market deposits		434,198			418,862			429,711			405,128
Time deposits		499,334			534,250			510,759			519,283
Customer repurchase agreements		89,672			87,049			83,760			86,540
Shareholders’ equity (2)		145,260			152,843			144,855			150,303
Capital Ratios (2)
Tier 1 risk based		11.38	%		12.55	%		11.38	%		12.55	%
Total risk based		12.63	%		13.80	%		12.63	%		13.80	%
Leverage		7.71	%		8.31	%		7.71	%		8.31	%
Book value per common share (2)	$	6.66		$	7.99		$	6.66		$	7.99

(1)	Unless otherwise indicated, all amounts and ratios are presented based on continuing operations.
(2)	Includes the effects of discontinued operations.

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STERLING BANCORP
Consolidated Balance Sheets
(Unaudited)
(in thousands, except number of shares)

	September 30,
	2006		2005
ASSETS
Cash and due from banks	$	67,736	$	82,453
Interest-bearing deposits with other banks		1,348		3,086
Investment securities
Available for sale (at estimated market value)		155,997		210,903
Held to maturity (at cost)		450,431		496,108
Total investment securities		606,428		707,011
Loans held for sale		30,048		50,137
Loans held in portfolio, net of unearned discounts		1,122,197		992,445
Less allowance for loan losses		16,584		15,579
Loans, net		1,105,613		976,866
Customers’ liability under acceptances		1,725		1,935
Goodwill		22,843		21,158
Premises and equipment, net		10,956		11,139
Other real estate		2,053		328
Accrued interest receivable		5,504		5,774
Bank owned life insurance		27,677		26,706
Other assets		52,721		39,454
Total assets from continuing operations		1,934,652		1,926,047
Assets — discontinued operations		6,563		109,084
	$	1,941,215	$	2,035,131
LIABILITIES AND SHAREHOLDERS’ EQUITY
Deposits
Demand	$	507,367	$	540,030
Savings, NOW and money market		404,954		411,801
Time		523,122		525,661
Total deposits		1,435,443		1,477,492
Securities sold under agreements to repurchase — customers		59,092		57,920
Securities sold under agreements to repurchase — dealers		58,385		59,894
Federal funds purchased		20,000		29,100
Commercial paper		44,366		39,402
Short-term borrowings — FHLB		30,000		20,000
Short-term borrowings — other		1,110		1,169
Long-term borrowings — FHLB		20,000		80,000
Long-term borrowings — subordinated debentures		25,774		25,774
Acceptances outstanding		1,725		1,935
Accrued expenses and other liabilities		103,278		87,724
Liabilities — discontinued operations		1,014		1,270
Total liabilities		1,800,187		1,881,680
Shareholders’ equity		141,028		153,451
	$	1,941,215	$	2,035,131
MEMORANDA
Available for sale securities — amortized cost	$	159,972	$	213,867
Held to maturity securities — estimated market value		439,928		490,104
Shares outstanding
Common issued		21,177,084		21,048,125
Common in treasury		2,465,012		1,866,042

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STERLING BANCORP
Consolidated Statements of Operations
(Unaudited)
(dollars in thousands, except per share data)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2006			2005			2006			2005
INTEREST INCOME
Loans	$	22,600		$	18,392		$	63,569		$	50,471
Investment securities — available for sale		1,901			2,309			6,081			7,278
Investment securities — held to maturity		5,231			5,626			16,526			16,569
Federal funds sold		13			61			88			283
Deposits with other banks		23			16			73			38
Total interest income		29,768			26,404			86,337			74,639
INTEREST EXPENSE
Savings, NOW and money market deposits		2,407			1,182			5,862			2,578
Time deposits		5,170			3,771			14,346			9,913
Securities sold u/a/r — customers		975			548			2,437			1,302
Securities sold u/a/r — dealers		1,114			518			3,442			1,187
Federal funds purchased		305			209			691			387
Commercial paper		610			238			1,553			620
Short-term borrowings — FHLB		726			51			1,561			107
Short-term borrowings — other		5			7			23			17
Long-term borrowings — FHLB		297			834			1,344			2,642
Long-term subordinated debentures		523			523			1,570			1,570
Total interest expense		12,132			7,881			32,829			20,323
Interest expense allocated to discontinued operations		(856	)		(661	)		(2,508	)		(1,688	)
Total interest expense-continuing operations		11,276			7,220			30,321			18,635
Net interest income		18,492			19,184			56,016			56,004
Provision for loan losses		1,511			1,508			3,253			4,212
Net interest income after provision for loan losses		16,981			17,676			52,763			51,792
NONINTEREST INCOME
Customer related service charges and fees		6,340			3,933			15,872			10,957
Mortgage banking income		2,331			4,601			7,115			13,035
Trust fees		147			149			437			473
Bank owned life insurance income		225			460			713			1,147
Securities (losses)/gains		0			0			(445	)		197
Other income		209			87			351			430
Total noninterest income		9,252			9,230			24,043			26,239
NONINTEREST EXPENSES
Salaries		8,699			7,864			25,573			23,032
Employee benefits		2,394			2,426			8,066			6,350
Total personnel expense		11,093			10,290			33,639			29,382
Occupancy and equipment expenses, net		2,551			2,314			7,333			6,530
Advertising and marketing		973			909			2,779			2,960
Professional fees		1,620			702			4,136			3,567
Communications		486			360			1,332			1,146
Other expenses		2,741			2,655			7,573			7,033
Total noninterest expenses		19,464			17,230			56,792			50,618
Income from continuing operations before income taxes		6,769			9,676			20,014			27,413
Provision for income taxes		1,766			3,647			3,148			10,271
Income from continuing operations		5,003			6,029			16,866			17,142
Income/(loss) from discontinued operations, net of tax		184			245			(374	)		955
Loss on sale of discontinued operations, net of tax		(9,604	)		0			(9,604	)		0
Net (loss)/income	$	(4,417	)	$	6,274		$	6,888		$	18,097

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STERLING BANCORP
Consolidated Statements of Operations
(Unaudited)
(dollars in thousands, except per share data)

(continued)

	Three Months Ended September 30,					Nine Months Ended September 30,
	2006			2005		2006		2005
Average number of common shares outstanding
Basic		18,712,072			19,229,677		18,752,107		19,209,914
Diluted		19,230,823			19,851,580		19,274,858		19,806,957
Net (loss)/income per average common share
Basic	$	(0.23	)	$	0.32	$	0.37	$	0.94
Diluted		(0.23	)(1)		0.31		0.36		0.91
Income from continuing operations, per average common share
Basic		0.27			0.31		0.90		0.89
Diluted		0.27			0.30		0.88		0.86
Dividends per common share		0.19			0.18		0.57		0.54

(1) Due to a loss for the period, zero incremental shares are included because the effect would be antidilutive.

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STERLING BANCORP
Consolidated Statements of Comprehensive (Loss)/Income
(Unaudited)
(in thousands)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2006			2005			2006			2005
Net (loss)/income	$	(4,417	)	$	6,274		$	6,888		$	18,097
Other comprehensive (loss)/ income, net of tax:
Unrealized holding gains/(losses)arising during the period		1,872			(1,212	)		(348	)		(2,119	)
Less:
Reclassification adjustment for losses/ (gains) included in net income		0			0			244			(107	)
Comprehensive (loss)/income	$	(2,545	)	$	5,062		$	6,784		$	15,871

STERLING BANCORP
Consolidated Statements of Changes in Shareholders’ Equity
(Unaudited)
(in thousands)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2006			2005			2006			2005
Balance, at beginning of period	$	147,115		$	154,806		$	147,588		$	148,704
Net (loss)/income for period		(4,417	)		6,274			6,888			18,097
Common shares issued under stock incentive plan and related tax benefits		11			935			1,735			4,046
Purchase of common shares for treasury		0			(2,776	)		(3,810	)		(3,323	)
Cash dividends-Common shares		(3,553	)		(3,481	)		(10,677	)		(10,444	)
Surrender of shares issued under incentive compensation plan		0			(1,161	)		(614	)		(1,606	)
Amortization of unearned compensation		0			66			22			203
Change in net unrealized holding gains/(losses) on available for sale securities		1,872			(1,212	)		(348	)		(2,119	)
Reclassification adjustment for losses/(gains) included in net income		0			0			244			(107	)
Balance, at end of period	$	141,028		$	153,451		$	141,028		$	153,451

Page 11 of 15

STERLING BANCORP
Average Balance Sheets[1]
(Unaudited)
(dollars in thousands)

	Three Months Ended
	September 30, 2006									September 30, 2005
	AVERAGE						AVERAGE			AVERAGE						AVERAGE
	BALANCE			INTEREST			RATE			BALANCE			INTEREST			RATE
Assets
Interest-bearing deposits with other banks	$	2,346		$	23			3.80	%	$	3,455		$	16			1.45	%
Investment securities — available for sale		140,167			1,660			4.74			190,371			2,055			4.32
Investment securities — held to maturity		464,408			5,231			4.51			504,688			5,626			4.46
Investment securities — tax exempt [2]		24,728			396			6.35			24,701			416			6.68
Total investment securities		629,303			7,287			4.63			719,760			8,097			4.50
Federal funds sold		978			13			5.15			6,935			61			3.43
Loans, net of unearned discount [3]		1,051,501			22,600			8.94			978,139			18,392			7.76
Total Interest-Earning Assets [2]		1,684,128			29,923			7.24	%		1,708,289			26,566			6.30	%
Cash and due from banks		59,133									60,457
Allowance for loan losses		(18,516	)								(17,100	)
Goodwill		22,958									21,158
Other		92,616									82,170
Assets — discontinued operations		108,481									109,143
Total Assets	$	1,948,800								$	1,964,117
Liabilities and Shareholders’ Equity
Interest-bearing deposits
Domestic
Savings	$	22,559			25			0.44	%	$	28,148			31			0.44	%
NOW		210,116			1,097			2.07			143,101			278			0.77
Money market		201,523			1,285			2.53			247,613			873			1.40
Time		496,304			5,162			4.13			531,234			3,763			2.81
Foreign
Time		3,030			8			0.99			3,016			8			1.42
Total Interest-Bearing Deposits		933,532			7,577			3.22			953,112			4,953			2.06
Borrowings
Securities sold u/a/r — customers		89,672			975			4.31			87,049			548			2.50
Securities sold u/a/r — dealers		81,701			1,114			5.41			57,755			518			3.56
Federal funds purchased		22,568			305			5.29			23,438			209			3.55
Commercial paper		50,076			610			4.84			34,341			238			2.74
Short-term borrowings — FHLB		52,953			726			5.43			5,435			51			3.77
Short-term borrowings — other		395			5			5.35			674			7			3.58
Long-term borrowings — FHLB		25,543			297			4.65			80,000			834			4.17
Long-term borrowings — sub debt		25,774			523			8.38			25,774			523			8.38
Total Borrowings		348,682			4,555			5.20			314,466			2,928			3.71
Interest-bearing liabilities allocated to discontinued operations		(99,377	)		(856	)		3.74			(97,137	)		(661	)		2.66
Total Interest-Bearing Liabilities		1,182,837			11,276			3.22	%		1,170,441			7,220			2.46	%
Noninterest-bearing demand deposits		424,834									461,418
Other liabilities		96,492									82,278
Liabilities — discontinued operations		99,377									97,137
Total Liabilities		1,803,540									1,811,274
Shareholders’ equity		145,260									152,843
Total Liabilities and Shareholders’ Equity	$	1,948,800								$	1,964,117
Net interest income/spread [2]					18,647			4.02	%					19,346			3.84	%
Net yield on interest-earning assets								4.49	%								4.55	%
Less: Tax-equivalent adjustment					155									162
Net interest income				$	18,492								$	19,184

[1]	The average balances of assets, liabilities and shareholders’ equity are computed on the basis of daily averages. Average rates are presented on a tax-equivalent basis. Certain reclassifications have been made to prior period amounts to conform to current presentation.
[2]	Interest and/or average rates are presented on a tax-equivalent basis.
[3]	Includes loans held for sale and loans held in portfolio; all loans are domestic. Nonaccrual loans are included in amounts outstanding and income has been included to the extent earned.

Page 12 of 15

STERLING BANCORP
Average Balance Sheets[1]
(Unaudited)
(dollars in thousands)

	Nine Months Ended
	September 30, 2006									September 30, 2005
	AVERAGE						AVERAGE			AVERAGE						AVERAGE
	BALANCE			INTEREST			RATE			BALANCE			INTEREST			RATE
Assets
Interest-bearing deposits with other banks	$	2,390		$	73			4.41	%	$	3,000		$	38			1.71	%
Investment securities — available for sale		151,265			5,231			4.61			197,229			6,454			4.36
Investment securities — held to maturity		486,263			16,526			4.53			492,838			16,569			4.48
Investment securities — tax exempt [2]		28,721			1,400			6.52			25,415			1,350			7.10
Total investment securities		666,249			23,157			4.63			715,482			24,373			4.54
Federal funds sold		2,454			88			4.71			13,810			283			2.71
Loans, net of unearned discount [3]		1,018,876			63,569			8.84			923,133			50,471			7.75
Total Interest-Earning Assets [2]		1,689,969			86,887			7.10	%		1,655,425			75,165			6.25	%
Cash and due from banks		62,442									61,895
Allowance for loan losses		(17,711	)								(17,332	)
Goodwill		22,671									21,158
Other		90,439									80,433
Assets — discontinued operations		111,676									110,302
Total Assets	$	1,959,486								$	1,911,881
Liabilities and Shareholders’ Equity
Interest-bearing deposits
Domestic
Savings	$	23,956			76			0.42	%	$	28,583			85			0.40	%
NOW		189,741			2,522			1.78			146,845			740			0.67
Money market		216,014			3,264			2.02			229,700			1,753			1.02
Time		507,732			14,323			3.77			516,273			9,888			2.56
Foreign
Time		3,027			23			1.03			3,010			25			1.09
Total Interest-Bearing Deposits		940,470			20,208			2.87			924,411			12,491			1.81
Borrowings
Securities sold u/a/r — customers		83,760			2,437			3.89			86,540			1,302			2.01
Securities sold u/a/r — dealers		91,634			3,442			5.02			50,237			1,187			3.16
Federal funds purchased		18,291			691			4.98			15,739			387			3.25
Commercial paper		47,225			1,553			4.40			35,714			620			2.32
Short-term borrowings — FHLB		40,264			1,561			5.18			4,180			107			3.44
Short-term borrowings — other		628			23			4.92			721			17			3.07
Long-term borrowings — FHLB		38,938			1,344			4.60			86,300			2,642			4.08
Long-term borrowings — sub debt		25,774			1,570			8.38			25,774			1,570			8.38
Total Borrowings		346,514			12,621			4.87			305,205			7,832			3.42
Interest-bearing liabilities allocated to discontinued operations		(101,790	)		(2,508	)		3.36			(99,601	)		(1,688	)		2.23
Total Interest-Bearing Liabilities		1,185,194			30,321			2.92	%		1,130,015			18,635			2.26	%
Noninterest-bearing demand deposits		436,006									448,038
Other liabilities		91,641									83,924
Liabilities — discontinued operations		101,790									99,601
Total Liabilities		1,814,631									1,761,578
Shareholders’ equity		144,855									150,303
Total Liabilities and Shareholders’ Equity	$	1,959,486								$	1,911,881
Net interest income/spread [2]					56,566			4.18	%					56,530			3.99	%
Net yield on interest-earning assets								4.60	%								4.69	%
Less: Tax-equivalent adjustment					550									526
Net interest income				$	56,016								$	56,004

[1]	The average balances of assets, liabilities and shareholders’ equity are computed on the basis of daily averages. Average rates are presented on a tax-equivalent basis. Certain reclassifications have been made to prior period amounts to conform to current presentation.
[2]	Interest and/or average rates are presented on a tax-equivalent basis.
[3]	Includes loans held for sale and loans held in portfolio; all loans are domestic. Nonaccrual loans are included in amounts outstanding and income has been included to the extent earned.

Page 13 of 15

STERLING BANCORP
Rate/Volume Analysis [1]
(Unaudited)
(in thousands)

	Increase/(Decrease)
	Three Months Ended
	September 30, 2006
	Volume			Rate			Net [2]
INTEREST INCOME
Interest-bearing deposits with other banks	$	(6	)	$	13		$	7
Investment securities — available for sale		(584	)		189			(395	)
Investment securities — held to maturity		(458	)		63			(395	)
Investment securities — tax exempt		0			(20	)		(20	)
Total investment securities		(1,042	)		232			(810	)
Federal funds sold		(68	)		20			(48	)
Loans, net of unearned discounts [3]		1,390			2,818			4,208
TOTAL INTEREST INCOME	$	274		$	3,083		$	3,357
INTEREST EXPENSE
Interest-bearing deposits
Domestic
Savings	$	(6	)	$	0		$	(6	)
NOW		178			641			819
Money market		(187	)		599			412
Time		(262	)		1,661			1,399
Foreign
Time		0			0			0
Total interest-bearing deposits		(277	)		2,901			2,624
Borrowings
Securities sold under agreements to repurchase — customers		18			409			427
Securities sold under agreements to repurchase — dealers		265			331			596
Federal funds purchased		(8	)		104			96
Commercial paper		139			233			372
Short-term borrowings — FHLB		642			33			675
Short-term borrowings — other		(4	)		2			(2	)
Long-term borrowings — FHLB		(625	)		88			(537	)
Long-term borrowings — subordinated debentures		0			0			0
Total borrowings		427			1,200			1,627
Less: interest-bearing liabilities allocated to discontinued operations		(10	)		(185	)		(195	)
TOTAL INTEREST EXPENSE	$	140		$	3,916		$	4,056
NET INTEREST INCOME	$	134		$	(833	)	$	(699	)

[1]	This table is presented on a tax-equivalent basis.
[2]	Changes in interest income and interest expense due to a combination of both volume and rate have been allocated to the change due to volume and the change due to rate in proportion to the relationship of change due solely to each.
[3]	Includes loans held for sale and loans held in portfolio; all loans are domestic. Nonaccrual loans are included in amounts outstanding, and income has been included to the extent earned.

Page 14 of 15

STERLING BANCORP
Rate/Volume Analysis [1]
(Unaudited)
(in thousands)

	Increase/(Decrease)
	Nine Months Ended
	September 30, 2006
	Volume			Rate			Net [2]
INTEREST INCOME
Interest-bearing deposits with other banks	$	(10	)	$	45		$	35
Investment securities — available for sale		(1,574	)		351			(1,223	)
Investment securities — held to maturity		(224	)		181			(43	)
Investment securities — tax exempt		76			(26	)		50
Total investment securities		(1,722	)		506			(1,216	)
Federal funds sold		(321	)		126			(195	)
Loans, net of unearned discounts [3]		5,559			7,539			13,098
TOTAL INTEREST INCOME	$	3,506		$	8,216		$	11,722
INTEREST EXPENSE
Interest-bearing deposits
Domestic
Savings	$	(13	)	$	4		$	(9	)
NOW		267			1,515			1,782
Money market		(110	)		1,621			1,511
Time		(166	)		4,601			4,435
Foreign
Time		0			(2	)		(2	)
Total interest-bearing deposits		(22	)		7,739			7,717
Borrowings
Securities sold under agreements to repurchase — customers		(43	)		1,178			1,135
Securities sold under agreements to repurchase — dealers		1,315			940			2,255
Federal funds purchased		71			233			304
Commercial paper		247			686			933
Short-term borrowings — FHLB		1,374			80			1,454
Short-term borrowings — other		(2	)		8			6
Long-term borrowings — FHLB		(1,598	)		300			(1,298	)
Long-term borrowings — subordinated debentures		0			0			0
Total borrowings		1,364			3,425			4,789
Less: interest-bearing liabilities allocated to discontinued operations		(35	)		(785	)		(820	)
TOTAL INTEREST EXPENSE	$	1,307		$	10,379		$	11,686
NET INTEREST INCOME	$	2,199		$	(2,163	)	$	36

[1]	This table is presented on a tax-equivalent basis.
[2]	Changes in interest income and interest expense due to a combination of both volume and rate have been allocated to the change due to volume and the change due to rate in proportion to the relationship of change due solely to each.
[3]	Includes loans held for sale and loans held in portfolio; all loans are domestic. Nonaccrual loans are included in amounts outstanding, and income has been included to the extent earned.

Page 15 of 15