Exhibit 99.1
[STERLING BANCORP LOGO] [NEWS IMMEDIATE RELEASE LOGO] 650 FIFTH AVENUE
www.sterlingbancorp.com NEW YORK, NY 10019-6108
John Tietjen Kimberly Storin
Chief Financial Officer Investor Relations/Media Relations
Sterling Bancorp MWW Group
john.tietjen@sterlingbancorp.com kstorin@mww.com
212.757.8035 212.827.3752
STERLING BANCORP REPORTS 14.7% INCREASE IN NET INCOME FOR SECOND QUARTER 2004
Track Record of Double-digit Earnings Growth Extended to 44 Consecutive Quarters
New York, NY, July 20, 2004 - Sterling Bancorp (NYSE: STL), a financial holding
company and the parent company of Sterling National Bank, today reported its
financial results for the second quarter and six months ended June 30, 2004.
Second Quarter 2004 Highlights:
- Net income increased 14.7% to $6.7 million
- Diluted earnings per share grew to $0.42 from $0.37 in the second
quarter 2003
- 298,200 shares of common stock were repurchased by the Company
- Average demand deposits rose 13.8% to $408.5 million
- Average earning assets increased 13.0% to $1.6 billion
- Noninterest income grew to 27.0% of gross revenues
"Sterling's track record of double-digit net income and earnings per share
growth remained strong for the 44th consecutive quarter," said Louis J.
Cappelli, Chairman and Chief Executive Officer. "Maintaining our solid financial
results in a challenging and rapidly changing economic environment validates the
merits of our balanced business model."
"The Sterling franchise continued to exhibit solid organic growth across the
majority of business segments, most notably in the mortgage sector," continued
Chairman Cappelli. "During 2004, we have experienced modest declines in the
volume of residential mortgage loans sold to investors. The business model of
our mortgage company was not heavily dependent on the refinancing boom of 2001
through 2003. The continued execution of our business plan produced
substantially increased volume of higher margin residential real estate loans
sold to investors during 2004."
Chairman Cappelli concluded, "We believe that Sterling's broad customer base and
diversified loan portfolio position us to capitalize on the growth opportunities
presented to us in our markets. As we move forward into the second half of 2004,
we believe we are poised to benefit from a rising interest rate environment due
to Sterling's high levels of noninterest-bearing deposits and floating rate
loans."
Page 1
SECOND QUARTER AND FIRST SIX MONTHS 2004 FINANCIAL RESULTS
NET INCOME
Net income for the second quarter 2004 was $6.7 million, a 14.7% increase from
$5.9 million in the second quarter 2003. Diluted earnings per share rose 13.5%
to $0.42 from $0.37 in the second quarter of last year (adjusted to reflect the
five-for-four stock split effected in September 2003).
For the six months ended June 30, 2004, net income grew 12.6% to $13.2 million
from $11.7 million in the first half of 2003. Diluted earnings per share
increased to $0.82 from $0.74 in the similar period of 2003 (adjusted to reflect
the five-for-four stock split effected in September 2003).
The year-over-year increase in net income was a result of continued growth in
net interest income and noninterest income, which in conjunction with a lower
provision for taxes, more than offset increases in the provision for loan losses
and noninterest expenses.
NET INTEREST INCOME
In the second quarter 2004, net interest income, on a tax equivalent basis,
increased to $19.2 million from $18.8 million in the second quarter 2003.
For the six months ended June 30, 2004, net interest income, on a tax equivalent
basis, rose to $38.5 million from $37.3 million in the first half of 2003.
On December 31, 2003, the Company adopted Financial Accounting Standards Board
Interpretation No. 46R ("FIN 46R") "Consolidation of Variable Interest
Entities," which clarified certain provisions of a previous interpretation.
Under the provisions of FIN 46R, Sterling deconsolidated the issuer trust and
accounts for its investment in the trust as an asset, its junior subordinated
debentures as long-term debt and the interest paid on those debentures as
interest expense. As a result of the adoption of FIN 46R, Sterling's prior
period presentations have been restated to conform to the current presentation.
Net interest margin, on a tax equivalent basis, for the second quarter 2004 was
4.75%, compared to 5.31% for the second quarter 2003 (adjusted to reflect the
adoption of FIN 46R).
For the six-month period ended June 30, 2004, net interest margin, on a tax
equivalent basis, was 4.87%, compared to 5.43% for the similar period of 2003
(adjusted to reflect the adoption of FIN 46R).
The decreases for both periods were primarily due to the lower interest rate
environment in 2004 and the effect of the mix of earning assets (including
principal prepayments in the investment portfolio), partially offset by the
impact of increases in average investment securities and loans outstanding.
Page 2
LOANS
Average loans held in portfolio for the second quarter 2004 grew 13.4%
year-over-year to $856.7 million.
For the six-month period ended June 30, 2004, average loans held in portfolio
rose 11.7% to $837.8 million.
DEMAND DEPOSITS
Demand deposits, on average, for the second quarter 2004, increased to $408.5
million from $358.9 million in the similar period of 2003.
Demand deposits, on average, grew by 15.1% to $405.3 million in the six-month
period ended June 30, 2004.
Demand deposits were 35.4% of total deposits as of June 30, 2004.
COST OF FUNDS
The average rate paid on interest-bearing funds was 1.61% for the second quarter
2004, compared to 1.83% for the second quarter 2003 (adjusted to reflect the
adoption of FIN 46R), reflecting management's ongoing discipline in controlling
funding costs. In the second quarter 2004, total interest expense remained
virtually unchanged from the same period of 2003 at $4.5 million.
For the six-month period ended June 30, 2004, the average rate paid on
interest-bearing funds was 1.64%, compared to 1.84% for the similar period of
2003 (adjusted to reflect the adoption of FIN 46R). For the six months ended
June 30, 2004, total interest expense was $9.1 million compared to $8.9 million
in the similar period of 2003.
Average interest-bearing deposits for the second quarter 2004 grew to $798.7
million from $676.2 million. Average interest-bearing deposits for the six
months ended June 30, 2004 grew 19.6% to $796.2 million. The increases in both
periods were a result of business development and growth in Sterling's two new
branches in Long Island City, Queens and Yonkers, New York.
NONINTEREST INCOME AND NONINTEREST EXPENSES
For the second quarter 2004, noninterest income was $8.7 million, compared to
$8.1 million in the second quarter 2003. This increase was the result of
increased income primarily from mortgage and factoring business units (combined
income grew 11%), partially offset by lower income from trade finance and
service charges on deposit accounts.
Noninterest income for the six-month period ended June 30, 2004 increased to
$16.9 million from $15.6 million in the corresponding period of last year. This
increase was the result of increased income primarily from mortgage and
factoring business units (combined income grew 11%), as well as securities
gains, partially offset by lower income from trade finance and service charges
on deposit accounts.
Page 3
Noninterest expenses for the quarter ended June 30, 2004 were $16.1 million,
compared to $15.0 million in the corresponding period of 2003. The increase was
due to investments in the Sterling franchise, including the new branches in Long
Island City and Yonkers, with higher expenses primarily related to salaries and
employee benefits and professional fees.
For the six-month period ended June 30, 2004, noninterest expenses were $30.8
million, compared to $29.4 million in the similar period of 2003. The increase
was primarily due to higher expenses related to salaries and employee benefits,
advertising and marketing and professional fees, partially offset by a first
quarter reduction in employee benefit costs.
PROVISION FOR INCOME TAXES
During the second quarter 2004, certain open tax issues for the years 1999
through 2001 were resolved with state tax representatives. As a result,
management conducted a review with outside professionals and reduced the
provision for income taxes for the second quarter by approximately $1.5 million.
ASSET QUALITY
As of June 30, 2004, nonperforming assets were $3.8 million, representing 0.21%
of total assets.
The provision for loan losses for the second quarter 2004 increased to $2.5
million from $2.2 million in the second quarter 2003.
For the six months ended June 30, 2004, the provision for loan losses increased
to $4.9 million from $4.0 million in the similar period of 2003.
The allowance for loan losses was $15.0 million, or 1.66% of loans held in
portfolio, as of June 30, 2004.
CAPITAL MANAGEMENT
During the first six months of 2004, Sterling repurchased 298,200 shares of
common stock as part of its authorized share repurchase plan. All of these
shares were repurchased in the second quarter.
Return on average tangible equity, on an annualized basis, was 22.37% for the
second quarter 2004.
For the six-month period ended June 30, 2004, return on average tangible equity,
on an annualized basis, was 21.77%.
Page 4
DIVIDEND
On June 30, 2004, Sterling paid a cash dividend of $0.19 per common share to
shareholders of record as of June 15, 2004. The Company has been distributing
quarterly cash dividends for more than 58 years.
CONFERENCE CALL
Sterling Bancorp will host a teleconference call for the financial community on
Tuesday, July 20, 2004 at 10:00 a.m. Eastern Daylight Time to discuss the second
quarter 2004 financial results. The public is invited to listen to this
conference call by dialing 888-792-1079 at least 10 minutes prior to the call
and entering passcode 515539.
A replay of the conference call will be available at 1:00 pm Eastern Daylight
Time on Tuesday, July 20, 2004 until 11:59 p.m. Eastern Daylight Time on
Tuesday, July 27, 2004. The public is invited to listen to this conference call
by dialing 888-266-2081 and entering passcode 515539.
ABOUT STERLING BANCORP
Sterling Bancorp (NYSE: STL) is a financial holding company with assets of $1.8
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, trade financing, equipment leasing, corporate
and consumer deposit services, trust and estate administration, and investment
management services. The Company has operations in New York, Virginia and North
Carolina and conducts business throughout the U.S.
This press release may contain statements, including but not limited to,
statements concerning future results of operations or financial position,
borrowing capacity and future liquidity, future investment results, future
credit exposure, future loan losses and plans and objectives for future
operations, and other statements regarding matters that are not historical
facts, that are "forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. 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 of its control. Any
forward-looking statements the Company may make speak only as of the date on
which such statements are made. It is possible that the Company's actual results
and financial position may differ, possibly 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, see "Business -- Cautionary Statement
Regarding Forward-looking Statements" in the Company's Annual Report on Form
10-K for the fiscal year ended December 31, 2003.
Page 5
STERLING BANCORP
CONSOLIDATED FINANCIAL HIGHLIGHTS
(DOLLARS AND SHARES IN THOUSANDS, EXCEPT PER SHARE DATA)
THREE MONTHS ENDED JUNE 30, SIX MONTHS ENDED JUNE 30,
--------------------------- ---------------------------
2004 2003 2004 2003
------- ------- ------- -------
OPERATING HIGHLIGHTS
Interest income $23,552 $23,096 $47,087 $45,729
Interest expense 4,519 4,520 9,058 8,896
Provision for loan losses 2,470 2,173 4,897 3,964
Noninterest income 8,725 8,116 16,949 15,570
Noninterest expenses 16,065 15,020 30,758 29,413
Net income 6,719 5,860 13,180 11,706
Earnings per common share:(1)
Basic 0.44 0.39 0.87 0.78
Diluted 0.42 0.37 0.82 0.74
Cash dividends declared (1) 0.19 0.15 0.38 0.30
Common shares outstanding:(1)
Period end 15,176 14,883 15,176 14,883
Average Basic 15,333 14,850 15,235 14,846
Average Diluted 16,035 15,683 16,017 15,665
Return on average assets 1.54% 1.50% 1.52% 1.54%
Return on average tangible equity (2) 22.37% 20.95% 21.77% 21.31%
Return on average stated equity (3) 19.04% 17.63% 18.55% 17.90%
Net interest spread, tax equivalent basis 4.30% 4.79% 4.40% 4.92%
Net interest margin, tax equivalent basis 4.75% 5.31% 4.87% 5.43%
ASSET QUALITY HIGHLIGHTS
PERIOD END
Net charge-offs $ 2,205 $ 1,807 $ 4,328 $ 3,329
Nonperforming loans 2,756 2,522 2,756 2,522
Other real estate owned 1,033 965 1,033 965
Nonperforming assets 3,789 3,487 3,789 3,487
Nonperforming loans/loans (4) 0.29% 0.29% 0.29% 0.29%
Nonperforming assets/assets 0.21% 0.22% 0.21% 0.22%
Allowance for loan losses/loans (5) 1.66% 1.77% 1.66% 1.77%
Allowance for loan losses/
nonperforming loans 545.28% 562.41% 545.28% 562.41%
(1) The prior period has been restated to reflect the five- for- four stock
split effected in September 2003.
(2) Average tangible equity represents average shareholders' equity less
average excess cost over equity in net assets of the bank.
(3) Average stated equity is equal to average shareholders' equity.
(4) The term "loans" includes loans held for sale and loans held in portfolio.
(5) The term "loans" includes loans held in portfolio only.
PAGE 6
STERLING BANCORP
CONSOLIDATED FINANCIAL HIGHLIGHTS
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
THREE MONTHS ENDED JUNE 30, SIX MONTHS ENDED JUNE 30,
------------------------------- -------------------------------
2004 2003 2004 2003
---------- ---------- ---------- ----------
BALANCE SHEET HIGHLIGHTS
PERIOD END BALANCES
Security investments $ 696,062 $ 583,601 $ 696,062 $ 583,601
Loans held for sale 44,458 69,811 44,458 69,811
Loans held in portfolio,
net of unearned discount 903,136 800,979 903,136 800,979
Total earning assets 1,645,817 1,456,679 1,645,817 1,456,679
Allowance for loan losses 15,028 14,184 15,028 14,184
Total assets 1,798,619 1,580,697 1,798,619 1,580,697
Noninterest-bearing deposits 444,343 385,144 444,343 385,144
Interest-bearing deposits 811,443 679,900 811,443 679,900
Customer repurchase agreements 80,681 82,006 80,681 82,006
Shareholders' equity 139,252 136,900 139,252 136,900
AVERAGE BALANCES
Security investments $ 717,169 $ 593,682 $ 706,153 $ 580,916
Loans held for sale 44,429 78,924 44,122 68,637
Loans held in portfolio,
net of unearned discount 856,727 755,236 837,756 749,927
Total earning assets 1,623,695 1,436,808 1,602,884 1,409,429
Allowance for loan losses 15,597 14,481 15,460 14,363
Total assets 1,760,091 1,565,602 1,741,300 1,535,972
Noninterest-bearing deposits 408,520 358,902 405,315 352,237
Interest-bearing deposits 798,716 676,208 796,157 665,835
Customer repurchase agreements 78,753 71,449 77,061 64,522
Shareholders' equity 141,961 133,354 142,894 131,907
CAPITAL RATIOS
Tier 1 risk based 13.47% 14.45% 13.47% 14.45%
Total risk based 14.72% 15.71% 14.72% 15.71%
Leverage 8.53% 9.06% 8.53% 9.06%
Book value per common share (1) $ 9.18 $ 9.06 $ 9.18 $ 9.06
(1) The prior period has been restated to reflect the five- for- four stock
split effected in September 2003.
PAGE 7
STERLING BANCORP
BALANCE SHEETS
(IN THOUSANDS, EXCEPT NUMBER OF SHARES)
JUNE 30,
--------------------------------
2004 2003
----------- -----------
ASSETS
Cash and due from banks $ 74,605 $ 58,168
Interest-bearing deposits with other banks 2,161 2,288
Investment securities
Available for sale (at estimated market value) 300,452 194,477
Held to maturity (at cost) 395,610 389,124
----------- -----------
Total investment securities 696,062 583,601
----------- -----------
Loans held for sale 44,458 69,811
----------- -----------
Loans held in portfolio, net of unearned discounts 903,136 800,979
Less allowance for loan losses 15,028 14,184
----------- -----------
Loans, net 888,108 786,795
----------- -----------
Customers' liability under acceptances 1,067 2,360
Excess cost over equity in net assets of the banking subsidiary 21,158 21,158
Premises and equipment, net 10,285 9,312
Other real estate 1,033 965
Accrued interest receivable 5,256 4,989
Bank owned life insurance 22,349 21,369
Other assets 32,077 19,881
----------- -----------
$ 1,798,619 $ 1,580,697
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits
Noninterest-bearing $ 444,343 $ 385,144
Interest-bearing 811,443 679,900
----------- -----------
Total deposits 1,255,786 1,065,044
Securities sold under agreements to repurchase - customers 80,681 82,006
Securities sold under agreements to repurchase - dealers 58,616 26,717
Federal funds purchased 0 10,000
Commercial paper 36,201 17,348
Other short-term borrowings 15,525 31,610
Acceptances outstanding 1,067 2,360
Accrued expenses and other liabilities 75,717 67,938
Long-term debt 135,774 140,774
----------- -----------
Total liabilities 1,659,367 1,443,797
----------- -----------
Shareholders' equity 139,252 136,900
----------- -----------
$ 1,798,619 $ 1,580,697
=========== ===========
MEMORANDA
Available for sale securities - amortized cost $ 303,868 $ 188,776
Held to maturity securities - estimated market value 391,756 399,575
Shares outstanding
Preferred - Series D 0 228,369
Common issued (1) 16,794,483 16,186,435
Common in treasury 1,618,903 1,303,422
(1) The prior period has been restated to reflect the five- for- four stock
split effected in September 2003.
PAGE 8
STERLING BANCORP
STATEMENTS OF INCOME
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
THREE MONTHS ENDED JUNE 30, SIX MONTHS ENDED JUNE 30,
------------------------------ ------------------------------
2004 2003 2004 2003
----------- ----------- ----------- -----------
INTEREST INCOME
Loans $ 15,412 $ 15,381 $ 30,494 $ 30,141
Investment securities - available for sale 3,454 2,395 7,146 4,907
Investment securities - held to maturity 4,676 5,298 9,383 10,629
Federal funds sold 7 18 57 40
Deposits with other banks 3 4 7 12
----------- ----------- ----------- -----------
Total interest income 23,552 23,096 47,087 45,729
----------- ----------- ----------- -----------
INTEREST EXPENSE
Deposits 2,374 2,309 4,847 4,511
Securities sold under agreements to repurchase 365 384 681 683
Federal funds purchased 47 25 63 36
Commercial paper 78 56 141 126
Other short-term borrowings 94 141 206 331
Long-term debt 1,561 1,605 3,120 3,209
----------- ----------- ----------- -----------
Total interest expense 4,519 4,520 9,058 8,896
----------- ----------- ----------- -----------
Net interest income 19,033 18,576 38,029 36,833
Provision for loan losses 2,470 2,173 4,897 3,964
----------- ----------- ----------- -----------
Net interest income after provision
for loan losses 16,563 16,403 33,132 32,869
----------- ----------- ----------- -----------
NONINTEREST INCOME
Factoring income 1,767 1,411 3,194 2,763
Mortgage banking income 3,915 3,691 7,546 6,934
Service charges on deposit accounts 1,159 1,270 2,222 2,502
Trade finance income 518 589 1,011 1,162
Trust fees 166 165 348 330
Other service charges and fees 481 532 955 967
Bank owned life insurance income 243 277 477 538
Securities gains 149 100 685 196
Other income 327 81 511 178
----------- ----------- ----------- -----------
Total noninterest income 8,725 8,116 16,949 15,570
----------- ----------- ----------- -----------
NONINTEREST EXPENSES
Salaries and employee benefits 9,735 8,562 18,087 17,046
Occupancy expenses, net 1,085 1,234 2,311 2,530
Equipment expenses 658 720 1,414 1,366
Advertising and marketing 925 859 2,018 1,650
Professional fees 1,074 899 1,988 1,626
Data processing fees 301 260 588 525
Stationery and printing 195 237 461 445
Communications 391 406 798 849
Mortgage tax expense 201 257 363 435
Other expenses 1,500 1,586 2,730 2,941
----------- ----------- ----------- -----------
Total noninterest expenses 16,065 15,020 30,758 29,413
----------- ----------- ----------- -----------
Income before income taxes 9,223 9,499 19,323 19,026
Provision for income taxes 2,504 3,639 6,143 7,320
----------- ----------- ----------- -----------
NET INCOME $ 6,719 $ 5,860 $ 13,180 $ 11,706
=========== =========== =========== ===========
Average number of common
shares outstanding (1)
Basic 15,332,631 14,850,210 15,234,781 14,846,243
Diluted 16,034,529 15,683,465 16,017,106 15,664,707
Earnings per average common share (1)
Basic $ 0.44 $ 0.39 $ 0.87 $ 0.78
Diluted 0.42 0.37 0.82 0.74
Dividends per common share (1) 0.19 0.15 0.38 0.30
(1) The prior period has been restated to reflect the five- for- four stock
split effected in September 2003.
PAGE 9
STERLING BANCORP
STATEMENTS OF COMPREHENSIVE INCOME
(IN THOUSANDS)
THREE MONTHS ENDED JUNE 30, SIX MONTHS ENDED JUNE 30,
--------------------------- ---------------------------
2004 2003 2004 2003
-------- -------- -------- --------
NET INCOME $ 6,719 $ 5,860 $ 13,180 $ 11,706
Other comprehensive income, net of tax:
Unrealized holding (losses)/gains arising
during the period (4,981) 108 (3,554) (411)
Less:
Reclassification adjustment for
gains included in net income (80) (54) (370) (106)
Minimum pension liability adjustment 0 0 (364) 0
-------- -------- -------- --------
COMPREHENSIVE INCOME $ 1,658 $ 5,914 $ 8,892 $ 11,189
======== ======== ======== ========
STERLING BANCORP
STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
(IN THOUSANDS)
THREE MONTHS ENDED JUNE 30, SIX MONTHS ENDED JUNE 30,
----------------------------- -----------------------------
2004 2003 2004 2003
--------- --------- --------- ---------
BALANCE, AT BEGINNING OF PERIOD $ 148,374 $ 132,550 $ 143,185 $ 129,780
Net income for period 6,719 5,860 13,180 11,706
Options exercised 217 663 1,156 847
Purchase of common shares for treasury (8,310) (138) (8,310) (256)
Cash dividends
Common shares (2,872) (2,243) (5,791) (4,474)
Preferred shares 0 (31) 0 (63)
Surrender of shares issued under
incentive compensation plan 0 0 (251) (494)
Amortization of unearned compensation 185 185 371 371
Change in net unrealized holding (losses)/gains
on available for sale securities (4,981) 108 (3,554) (411)
Reclassification adjustment for (gains)
included in net income (80) (54) (370) (106)
Minimum pension liability adjustment 0 0 (364) 0
--------- --------- --------- ---------
BALANCE, AT END OF PERIOD $ 139,252 $ 136,900 $ 139,252 $ 136,900
========= ========= ========= =========
PAGE 10
STERLING BANCORP
AVERAGE BALANCE SHEETS [1]
(dollars in thousands)
THREE MONTHS ENDED
-----------------------------------------------------------------------
JUNE 30, 2004 JUNE 30, 2003
---------------------------------- ----------------------------------
AVERAGE AVERAGE AVERAGE AVERAGE
BALANCE INTEREST RATE BALANCE INTEREST RATE
----------- ---------- ------- ----------- ---------- --------
ASSETS
Interest-bearing deposits with other banks $ 2,952 $ 3 0.58% $ 3,087 $ 4 0.73%
Investment securities - available for sale 291,038 3,126 4.30 159,581 2,039 5.11
Investment securities - held to maturity 395,637 4,676 4.73 401,479 5,298 5.28
Investment securities - tax exempt [2] 30,494 516 6.81 32,622 605 7.44
Federal funds sold 2,418 7 0.95 5,879 18 1.21
Loans, net of unearned discount [3] 901,156 15,412 7.02 834,160 15,381 7.64
----------- ---------- ----------- ----------
TOTAL INTEREST-EARNING ASSETS 1,623,695 23,740 5.91% 1,436,808 23,345 6.62%
---------- ==== ---------- ====
Cash and due from banks 58,365 57,931
Allowance for loan losses (15,597) (14,481)
Excess cost over equity in
net assets of the bank 21,158 21,158
Other 72,470 64,186
----------- -----------
TOTAL ASSETS $ 1,760,091 $ 1,565,602
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Interest-bearing deposits
Domestic
Savings $ 32,636 33 0.41% $ 27,407 23 0.34%
NOW 135,345 147 0.44 116,406 160 0.55
Money market 203,133 191 0.38 161,943 200 0.50
Time 424,602 1,995 1.89 367,452 1,916 2.09
Foreign
Time 3,000 8 1.10 3,000 10 1.29
----------- ---------- ----------- ----------
TOTAL DEPOSITS 798,716 2,374 1.20 676,208 2,309 1.37
----------- ---------- ----------- ----------
Borrowings
Securities sold under agreements to
repurchase - customers 78,753 219 1.12 71,449 224 1.26
Securities sold under agreements to
repurchase - dealers 50,730 146 1.16 49,032 160 1.31
Federal funds purchased 17,399 47 1.10 7,528 25 1.29
Commercial paper 28,323 78 1.12 19,981 56 1.11
Other short-term debt 18,886 94 1.99 30,410 141 1.97
Long-term debt 135,774 1,561 4.59 140,774 1,605 4.56
----------- ---------- ----------- ----------
TOTAL BORROWINGS 329,865 2,145 2.60 319,174 2,211 2.78
----------- ---------- ----------- ----------
TOTAL INTEREST-BEARING LIABILITIES 1,128,581 4,519 1.61% 995,382 4,520 1.83%
----------- ---------- ==== ----------- ---------- ====
Noninterest-bearing demand deposits 408,520 358,902
Other liabilities 81,029 77,964
----------- -----------
Total Liabilities 1,618,130 1,432,248
Shareholders' equity 141,961 133,354
----------- -----------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 1,760,091 $ 1,565,602
=========== ===========
Net interest income/spread 19,221 4.30% 18,825 4.79%
==== ====
Net yield on interest-earning assets 4.75% 5.31%
==== ====
Less: Tax equivalent adjustment 188 249
---------- ----------
Net interest income $ 19,033 $ 18,576
========== ==========
[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 2003
amounts to conform to current presentation.
[2] Interest on tax-exempt securities is 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 11
STERLING BANCORP
AVERAGE BALANCE SHEETS [1]
(dollars in thousands)
SIX MONTHS ENDED
-----------------------------------------------------------------------
JUNE 30, 2004 JUNE 30, 2003
---------------------------------- ----------------------------------
AVERAGE AVERAGE AVERAGE AVERAGE
BALANCE INTEREST RATE BALANCE INTEREST RATE
----------- ---------- ------- ----------- ---------- --------
ASSETS
Interest-bearing deposits with other banks $ 3,150 $ 7 0.82% $ 3,391 $ 12 0.84%
Investment securities - available for sale 290,568 6,479 4.42 157,505 4,194 5.33
Investment securities - held to maturity 384,888 9,384 4.88 390,773 10,629 5.44
Investment securities - tax exempt [2] 30,697 1,091 7.15 32,638 1,211 7.48
Federal funds sold 11,703 56 0.95 6,558 40 1.21
Loans, net of unearned discount [3] 881,878 30,494 7.22 818,564 30,141 7.77
----------- ---------- ----------- ----------
TOTAL INTEREST-EARNING ASSETS 1,602,884 47,511 6.04% 1,409,429 46,227 6.76%
---------- ==== ---------- ====
Cash and due from banks 62,511 55,899
Allowance for loan losses (15,460) (14,363)
Excess cost over equity in
net assets of the bank 21,158 21,158
Other 70,207 63,849
----------- -----------
TOTAL ASSETS $ 1,741,300 $ 1,535,972
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Interest-bearing deposits
Domestic
Savings $ 32,791 65 0.40% $ 26,812 49 0.37%
NOW 134,683 301 0.45 115,571 297 0.52
Money market 206,540 561 0.55 156,573 375 0.48
Time 419,143 3,904 1.87 363,879 3,768 2.09
Foreign
Time 3,000 16 1.08 3,000 22 1.48
----------- ---------- ----------- ----------
TOTAL DEPOSITS 796,157 4,847 1.22 665,835 4,511 1.37
----------- ---------- ----------- ----------
Borrowings
Securities sold under agreements to
repurchase - customers 77,061 430 1.12 64,522 404 1.26
Securities sold under agreements to
repurchase - dealers 43,677 251 1.16 42,704 279 1.32
Federal funds purchased 11,653 63 1.08 5,608 36 1.27
Commercial paper 25,871 141 1.10 21,982 126 1.16
Other short-term debt 21,816 206 1.89 30,881 331 2.21
Long-term debt 135,774 3,120 4.59 140,774 3,209 4.56
----------- ---------- ----------- ----------
TOTAL BORROWINGS 315,852 4,211 2.67 306,471 4,385 2.87
----------- ---------- ----------- ----------
TOTAL INTEREST-BEARING LIABILITIES 1,112,009 9,058 1.64% 972,306 8,896 1.84%
----------- ---------- ==== ----------- ---------- ====
Noninterest-bearing demand deposits 405,315 352,237
Other liabilities 81,082 79,522
----------- -----------
Total Liabilities 1,598,406 1,404,065
Shareholders' equity 142,894 131,907
----------- -----------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 1,741,300 $ 1,535,972
=========== ===========
Net interest income/spread 38,453 4.40% 37,331 4.92%
==== ====
Net yield on interest-earning assets 4.87% 5.43%
==== ====
Less: Tax equivalent adjustment 424 498
---------- ----------
Net interest income $ 38,029 $ 36,833
========== ==========
[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 2003
amounts to conform to current presentation.
[2] Interest on tax-exempt securities is 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
STERLING BANCORP
RATE/VOLUME ANALYSIS [1]
(IN THOUSANDS)
INCREASE/(DECREASE)
THREE MONTHS ENDED
JUNE 30, 2004
---------------------------------
VOLUME RATE NET [2]
------- ------- -------
INTEREST INCOME
Interest-bearing deposits with other banks $ 0 $ (1) $ (1)
------- ------- -------
Investment securities - available for sale 1,452 (365) 1,087
Investment securities - held to maturity (76) (546) (622)
Investment securities - tax exempt (39) (50) (89)
------- ------- -------
Total investment securities 1,337 (961) 376
------- ------- -------
Federal funds sold (8) (3) (11)
Loans, net of unearned discounts [3] 1,298 (1,267) 31
------- ------- -------
TOTAL INTEREST INCOME $ 2,627 $(2,232) $ 395
======= ======= =======
INTEREST EXPENSE
Interest-bearing deposits
Domestic
Savings $ 4 $ 6 $ 10
NOW 23 (36) (13)
Money market 45 (54) (9)
Time 276 (197) 79
Foreign
Time 0 (2) (2)
------- ------- -------
Total interest-bearing deposits 348 (283) 65
------- ------- -------
Borrowings
Securities sold under agreements to repurchase - customers 22 (27) (5)
Securities sold under agreements to repurchase - dealers 6 (20) (14)
Federal funds purchased 27 (5) 22
Commercial paper 22 0 22
Other short-term debt (49) 2 (47)
Long-term debt - FHLB (55) 11 (44)
------- ------- -------
Total borrowings (27) (39) (66)
------- ------- -------
TOTAL INTEREST EXPENSE $ 321 $ (322) $ (1)
======= ======= =======
NET INTEREST INCOME $ 2,306 $(1,910) $ 396
======= ======= =======
[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. The effect of the extra day in 2004 has been included in
the change in volume.
[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
STERLING BANCORP
RATE/VOLUME ANALYSIS [1]
(IN THOUSANDS)
INCREASE/(DECREASE)
SIX MONTHS ENDED
JUNE 30, 2004
---------------------------------
VOLUME RATE NET [2]
------- ------- -------
INTEREST INCOME
Interest-bearing deposits with other banks $ (5) $ 0 $ (5)
------- ------- -------
Investment securities - available for sale 3,094 (809) 2,285
Investment securities - held to maturity (110) (1,135) (1,245)
Investment securities - tax exempt (68) (52) (120)
------- ------- -------
Total investment securities 2,916 (1,996) 920
------- ------- -------
Federal funds sold 26 (10) 16
Loans, net of unearned discounts [3] 2,608 (2,255) 353
------- ------- -------
TOTAL INTEREST INCOME $ 5,545 $(4,261) $ 1,284
======= ======= =======
INTEREST EXPENSE
Interest-bearing deposits
Domestic
Savings $ 12 $ 4 $ 16
NOW 47 (43) 4
Money market 128 58 186
Time 560 (424) 136
Foreign
Time 0 (6) (6)
------- ------- -------
Total interest-bearing deposits 747 (411) 336
------- ------- -------
Borrowings
Securities sold under agreements to repurchase - customers 75 (49) 26
Securities sold under agreements to repurchase - dealers 8 (36) (28)
Federal funds purchased 33 (6) 27
Commercial paper 22 (7) 15
Other short-term debt (83) (42) (125)
Long-term debt (108) 19 (89)
------- ------- -------
Total borrowings (53) (121) (174)
------- ------- -------
TOTAL INTEREST EXPENSE $ 694 $ (532) $ 162
======= ======= =======
NET INTEREST INCOME $ 4,851 $(3,729) $ 1,122
======= ======= =======
[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. The effect of the extra day in 2004 has been included in
the change in volume.
[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