Exhibit 99.1
New York Community Bancorp, Inc. Reports A 23% Increase In
2nd Quarter 2003 Diluted EPS To $0.53
And A 38% Increase In Diluted Cash EPS To $0.62
WESTBURY, N.Y.--(BUSINESS WIRE)--July 16, 2003--New York Community
Bancorp, Inc:
2003 Diluted GAAP EPS Estimates Raised to a Range of $2.04 - $2.10
Second Quarter 2003 Highlights
-- Earnings rose 23% year-over-year to $72 million, generating an
ROA of 2.36% and an ROTE of 43.16%
-- Cash earnings rose 37% year-over-year to $85 million,
generating an ROA of 2.78% and an ROE of 25.30% (1)
-- Net interest income rose 14% year-over-year to $108 million
-- Other operating income rose 20% year-over-year to $34 million
-- The efficiency ratio improved 311 basis points year-over-year
to 23.89%
-- Mortgage originations exceeded $767 million, boosting
year-to-date production past the $1.5 billion mark
New York Community Bancorp, Inc. (NYSE: NYB) today reported second
quarter 2003 net income of $71.8 million, up 23.4% from $58.1 million
in the second quarter of 2002. The 2003 amount provided a 21.45%
return on average stockholders' equity ("ROE") and a 2.36% return on
average assets ("ROA"), and was equivalent to a 23.3% increase in
diluted earnings per share to $0.53 from $0.43. (2)
For the six months ended June 30, 2003, the Company reported net
income of $139.1 million, representing a 33.2% increase from $104.5
million for the first six months of 2002. The 2003 amount generated an
ROE of 20.83% and an ROA of 2.30%, and was equivalent to a 30.7% rise
in diluted earnings per share to $1.01 from $0.77. (2)
The Company also reported cash earnings of $84.6 million, or $0.62
per diluted share, for the current second quarter and $156.9 million,
or $1.14 per diluted share, for the current six-month period. The
Company's cash earnings thus added $12.9 million, or 17.9%, more to
Tier 1 regulatory capital than its GAAP earnings for the current
second quarter and $17.8 million, or 12.8%, more than its GAAP
earnings for the first six months of 2003. The significant difference
between the Company's cash and GAAP earnings in the second quarter of
2003 partly reflects the substantial appreciation in the value of
shares held in the Company's stock-related benefit plan, which is
charged against earnings for purposes of GAAP accounting but added
back when calculating the Company's cash earnings for the same period.
(1) In the three months ended June 30, 2003, the value of the
Company's shares rose 30.2%, which resulted in higher stock-based
compensation and benefits expense for the quarter, while also having a
dilutive effect under the Treasury method of accounting for stock
options on the Company's earnings per share.
Commenting on the Company's second quarter 2003 performance,
President and Chief Executive Officer Joseph R. Ficalora stated, "Our
second quarter performance underscores four of the strengths of this
institution: our capacity to originate multi-family mortgage loans;
the consistent quality of our assets during a time of economic
uncertainty; the significant efficiency of our operations at a time
when we are enhancing our franchise; and the success of our leveraged
growth strategy."
Speaking further to each of these points, Mr. Ficalora noted, "Our
second quarter mortgage originations exceeded $767 million, and with a
current pipeline of $723.3 million, it is evident that our lending
capacity continues to be very strong. The quality of our assets
reflects the ongoing strength of our credit standards: This was our
35th consecutive quarter without any net charge-offs, and our second
consecutive quarter featuring a reduction in non-performing assets and
loans. At quarter's end, non-performing assets were a mere $13.4
million, representing 0.11% of total assets, including non-performing
loans of $13.3 million, representing 0.23% of loans, net.
"Despite the growth of our balance sheet and extensive
enhancements to our branch network, we realized further improvements
in our efficiency ratio," Mr. Ficalora continued. "In the second
quarter of 2003, our efficiency ratio was 23.89%, representing a
311-basis point improvement, reflecting our ability to hold the line
on expenses--and to increase revenues. Total revenues rose 15%
year-over-year, despite the pressure placed on our margin by the
accelerated rate of prepayments, the replenishment of our asset mix
with lower-yielding loans and investments, and our decision to
allocate $70.5 million toward the repurchase of Company shares over
the past three months."
"The second quarter was further highlighted by three events that
illustrate the strength of our performance, as well as our commitment
to providing our shareholders with a meaningful return," Mr. Ficalora
said. "The first of these was the issuance of a 33-1/3% stock dividend
in connection with a 4-for-3 stock split on May 21st. At the same time
as we announced the split, we also announced a 12% increase in our
quarterly cash dividend payment. As a result, the dividend has
increased 40% since the start of the year.
"The third event--and the one that we believe represents the
greatest potential return to our investors--was the signing of a
definitive merger agreement, on June 27th, with Roslyn Bancorp, Inc.
The $1.6 billion transaction is currently expected to be 10% accretive
to 2004 earnings and to result in our becoming the New York metro
region's largest community bank, with a current pro forma market cap
of $6.4 billion, based on yesterday's close," Mr. Ficalora said.
"In connection with the signing of the merger agreement with
Roslyn," Mr. Ficalora noted, "we also announced that our Board had
increased our current share repurchase authorization, enabling us to
repurchase up to five million additional shares of Company stock. In
addition, both institutions have the ability, under the terms of the
agreement, to purchase their own and each other's shares.
"The fundamental strengths revealed by our second quarter
performance augur well for the proposed merger, which we look forward
to completing in the fourth quarter of 2003," Mr. Ficalora added. "We
are currently in the process of preparing the necessary applications
and filings, which is the first step toward receiving the regulatory
and shareholder approvals we need for the merger to take place.
"Based on our second quarter results--and excluding any impact of
the pending Roslyn merger--we are currently projecting 2003 diluted
GAAP earnings per share of $2.04 to $2.10. Our current projection for
2004 is $2.53--reflecting the proposed merger with Roslyn Bancorp, the
projected repurchase of five million shares over the next four
quarters, and the projected downsizing of the pro forma balance sheet
by $3.5 billion," Mr. Ficalora said.
Earnings Summary for the Three Months Ended June 30, 2003
Interest Income
The Company recorded second quarter 2003 interest income of $162.3
million, up $10.0 million, or 6.6%, from the year-earlier amount. The
increase was fueled by a $2.3 billion, or 26.4%, rise in average
interest-earning assets to $10.8 billion, which was tempered by a
112-basis point decline in the average yield to 6.03%. The higher
average balance partly reflects second quarter 2003 mortgage
originations of $767.8 million and the leveraged growth of the
Company's asset mix at lower yields during a time of accelerated
prepayments and historically low market interest rates.
Mortgage and other loans generated interest income of $105.7
million in the current and year-earlier second quarters, representing
65.1% and 69.4% of total interest income in the respective periods. In
the second quarter of 2003, the average balance of mortgage and other
loans totaled $5.7 billion, signifying a $156.9 million increase, and
generated an average yield of 7.45%, down 21 basis points.
Mortgage-backed securities generated interest income of $33.4
million in the current second quarter, down $3.6 million, despite a
$1.1 billion rise in the average balance to $3.5 billion. The
year-over-year increase in average mortgage-backed securities was
partly offset by a 228-basis point reduction in the average yield on
such assets to 3.82%, reflecting the replenishment of the portfolio at
historically low market rates.
The interest income generated by investment securities rose $13.4
million year-over-year to $22.9 million. The increase was fueled by a
$1.0 billion rise in the average balance to $1.6 billion and tempered
by a 98-basis point decline in the average yield to 5.92%.
Interest Expense
The Company recorded interest expense of $54.0 million in the
current second quarter, down $2.9 million, or 5.1%, from the
year-earlier amount. The reduction was the net effect of a $1.8
billion rise in the average balance of interest-bearing liabilities to
$9.7 billion and a 64-basis point decline in the average cost of funds
to 2.22%. The Company has pursued a strategy of leveraged growth over
the past eight quarters, capitalizing on a yield curve that has grown
increasingly steep. While the higher average balance of
interest-bearing liabilities corresponds to the leveraged growth of
the balance sheet, the significant cost-of-funds reduction is
indicative of the steady decline in market interest rates over the
past twelve months.
Borrowings contributed $39.8 million to total interest expense in
the second quarter of 2003, signifying an $8.0 million year-over-year
increase, the net effect of a $1.9 billion rise in the average balance
to $5.0 billion and an 86-basis point decline in the average cost to
3.19%. The leveraged growth of the balance sheet has been largely
funded through Federal Home Loan Bank ("FHLB") advances and reverse
repurchase agreements featuring attractive rates.
Certificates of deposit ("CDs") generated second quarter 2003
interest expense of $9.0 million, down $6.1 million from the
year-earlier amount. The reduction stemmed from a $236.3 million
decline in the average balance to $1.8 billion and from a 98-basis
point decline in the average cost to 2.04%. The concentration of CDs
has declined steadily over the past four quarters, as the Company has
placed an emphasis on attracting core deposits with a lower cost of
funds.
The interest expense generated by core deposits fell $4.8 million
year-over-year to $5.1 million, the net effect of a $136.6 million
rise in the average balance to $3.4 billion and a 62-basis point
decline in the average cost to 0.61%. Non-interest-bearing deposits
accounted for $490.2 million of the average balance in the current
second quarter, up $9.5 million from the average balance in the second
quarter of 2002.
Net Interest Income
The Company recorded net interest income of $108.4 million in the
current second quarter, up $12.9 million from the level recorded in
the second quarter of 2002. The 13.5% increase largely reflects the
aforementioned growth in the Company's interest-earning assets, which
was funded by an increasingly low-cost mix of funds.
Reflecting the steady reduction in market interest rates and the
replenishment of the Company's asset mix with lower-yielding loans and
investments, the Company's net interest margin equaled 4.02% in the
current second quarter, as compared to 4.48% in the year-earlier three
months.
Provision for Loan Losses
The provision for loan losses was suspended for the 32nd
consecutive quarter, based on management's assessment of the loan loss
allowance and the Company's current and historic record of asset
quality.
Other Operating Income
Other operating income rose $5.7 million, or 20.4%, year-over-year
to $33.7 million, fueled by higher fee income and net securities
gains. Other operating income represented 23.7% of total revenues in
the current second quarter, up from 22.7% in the year-earlier three
months.
Non-interest Expense
The Company recorded total non-interest expense of $35.4 million
in the current second quarter, up $611,000 from $34.8 million in the
year-earlier three months. The amortization of the core deposit
intangible ("CDI") accounted for $1.5 million of the respective totals
and stemmed from the Company's merger of equals with Richmond County
Financial Corp. in the third quarter of 2001.
Operating expenses totaled $33.9 million and $33.3 million in the
respective second quarters, equivalent to 1.12% and 1.34% of average
assets in the corresponding periods. The modest increase in second
quarter 2003 operating expenses stemmed from a $976,000 rise in
compensation and benefits expense to $20.1 million and from a $263,000
increase in general and administrative ("G&A") expense to $7.3
million. These increases were partly offset by a $132,000 decline in
occupancy and equipment expense to $5.4 million and by a $496,000
decline in other expenses to $1.1 million. While the higher level of
G&A expense stemmed from several components, the higher level of
compensation and benefits expense was primarily due to the
year-over-year appreciation of shares held in the Company's
stock-related benefit plan.
The $18.6 million increase in total revenues served to offset the
$611,000 increase in operating expenses, resulting in a 311-basis
point improvement in the second quarter 2003 efficiency ratio to
23.89%.
Income Tax Expense
The Company recorded income tax expense of $34.8 million in the
current second quarter, up $4.4 million from the amount recorded in
the second quarter of 2002. The increase reflects an $18.0 million
rise in pre-tax income to $106.6 million and an effective tax rate of
32.7%, down from the year-earlier quarter's 34.4%.
Earnings Summary for the Six Months Ended June 30, 2003
Interest Income
The Company recorded interest income of $328.9 million in the
first six months of 2003, up $35.5 million, or 12.1%, from the level
recorded in the first six months of 2002. The increase was fueled by a
$2.4 billion rise in the average balance of interest-earning assets to
$10.7 billion and tempered by a 92-basis point decline in the average
yield to 6.20%. As discussed in the analysis of second quarter 2003
interest income, the higher average balance reflects a solid level of
mortgage loan production and the investment of borrowed funds into
mortgage-backed and investment securities at attractive spreads. The
lower yield is indicative of the prevailing rate environment, with
market interest rates having dropped to historic lows over the past
twelve months.
Mortgage and other loans generated $209.0 million, or 63.5%, of
year-to-date interest income, as compared to $206.1 million, or 70.2%,
in the first six months of 2002. The increase was fueled by a $145.2
million rise in the average balance of loans to $5.6 billion, which
was offset by a 10-basis point decline in the average yield to 7.50%.
Mortgage-backed securities generated interest income of $77.8
million in the current six-month period, up $8.5 million from the
level generated in the first six months of 2002. While the average
balance of mortgage-backed securities rose $1.4 billion year-over-year
to $3.7 billion, the increase was tempered by a 179-basis point
decline in the average yield to 4.28%. The interest income generated
by investment securities rose $23.8 million year-over-year to $41.5
million, as an $848.3 million rise in the average balance to $1.4
billion was tempered by an 82-basis point decline in the average yield
to 6.16%.
Interest Expense
The Company recorded total interest expense of $112.2 million in
the first six months of 2003, down $2.7 million from the total
recorded in the first six months of 2002. The reduction was the net
effect of a $1.8 billion rise in the average balance of
interest-bearing liabilities to $9.6 billion and a 61-basis point
decline in the average cost of funds to 2.36%. The higher average
balance is consistent with the leveraged growth strategy mentioned in
the second quarter discussion; the lower cost reflects the
aforementioned year-over-year decline in market interest rates. In
addition, the Company continued to see a transition of customers'
funds into lower-cost core deposits and away from comparatively
higher-cost CDs.
Borrowings produced interest expense of $79.4 million in the
current six-month period, up $18.5 million from the level produced in
the first six months of 2002. The increase was the net effect of a
$1.9 billion rise in the average balance to $4.8 billion and a
94-basis point decline in the average cost to 3.30%.
CDs generated six-month 2003 interest expense of $19.8 million,
down $14.9 million from the amount generated in the year-earlier six
months. The reduction was the combined result of a $311.2 million
decline in the average balance to $1.8 billion and a 108-basis point
drop in the average cost to 2.17%.
At the same time, core deposits generated interest expense of
$13.1 million, down $6.2 million from the level recorded in the first
six months of 2002. The reduction was the net effect of a $176.4
million rise in the average balance to $3.3 billion and a 44-basis
point decline in the average cost to 0.79%. Non-interest-bearing
deposits represented $480.3 million of the current six-month average
balance, having risen $16.4 million year-over-year.
Net Interest Income
The Company recorded net interest income of $216.7 million in the
current six-month period, up $38.2 million, or 21.4%, from the level
recorded in the first six months of 2002. The increase is partly
indicative of the Company's negative gap position: In a declining rate
environment, the Company's interest-earning assets have been repricing
downward at a slower pace than its various sources of funds. In
addition, the Company's net interest income has been fueled by the
leveraged growth of its interest-earning assets: The Company has
increasingly utilized borrowings in the form of FHLB advances and
reverse repurchase agreements to fund the origination of multi-family
and other mortgage loans and investments in mortgage-backed and other
securities.
The Company's net interest margin was 4.09% in the current
six-month period, down 24 basis points from the margin recorded in the
first six months of 2002. In addition to the factors cited in the
second quarter discussion of net interest margin, the reduction in the
six-month measure reflects the magnitude of the Company's share
repurchase program, with $103.8 million having been allocated toward
the repurchase of 4,184,437 shares in the first half of 2003.
Other Operating Income
Reflecting higher fee income and net securities gains, other
operating income rose $12.3 million, or 25.8%, year-over-year to $60.1
million in the first six months of 2003. Other operating income
represented 21.7% of total revenues in the current six-month period,
as compared to 21.1% in the year-earlier six months.
Non-interest Expense
The Company recorded total non-interest expense of $70.9 million
in the current six-month period, as compared to $70.0 million in the
first six months of 2002. The 2003 amount included total operating
expenses of $67.9 million, representing 1.12% of average assets; the
2002 amount included total operating expenses of $67.0 million,
representing 1.40% of average assets. In addition, the amortization of
CDI amounted to $3.0 million in each of the six-month periods.
The modest increase in operating expenses was the net effect of a
$3.2 million rise in compensation and benefits expense to $38.9
million, and a $2.3 million reduction in the remaining three
components of operating expenses, combined. Occupancy and equipment
expense declined $149,000 year-over-year to $11.5 million, while G&A
expense and other expenses fell $1.7 million and $510,000,
respectively, to $14.9 million and $2.6 million in the current
six-month period.
The net effect of the $50.5 million increase in total revenues and
the $888,000 rise in operating expenses was a 508-basis point
improvement in the current six-month efficiency ratio to 24.52%.
Income Tax Expense
In the first six months of 2003, the Company recorded income tax
expense of $66.8 million, up from $51.8 million in the first six
months of 2002. The increase reflects a $49.6 million rise in pre-tax
income to $205.9 million and an effective tax rate of 32.4%, as
compared to 33.2% in the year-earlier six months.
Balance Sheet Summary
Assets
The Company recorded total assets of $12.4 billion at June 30,
2003, up $1.1 billion, or 9.5%, from the balance recorded at December
31, 2002.
Mortgage and Other Loans
Mortgage and other loans totaled $5.9 billion at June 30, 2003,
signifying a $365.5 million, or 6.7%, increase from the balance
recorded at year-end 2002. In the first six months of the year, the
Company originated mortgage loans of $1.5 billion, including $767.8
million in the second quarter. Of the loans produced to date in 2003,
$1.2 billion were secured by multi-family buildings, including $590.2
million in the second quarter of the year. Reflecting the volume of
loans produced and the offsetting impact of prepayments, the portfolio
of multi-family mortgage loans grew $445.6 million, or 9.9%, from the
year-end 2002 level to $4.9 billion at June 30, 2003. Multi-family
loans thus represented 85.4% of total mortgage loans at the close of
the second quarter and 80.9% of total mortgage originations
year-to-date. The average multi-family loan had a principal balance of
$2.1 million and a loan-to-value ratio of 57.1% at June 30, 2003.
Asset Quality
The quality of the Company's loans continued to be solid, as the
balance of non-performing loans declined on a linked-quarter basis and
in comparison with the level recorded at year-end 2002. Non-performing
loans totaled $13.3 million at June 30, 2003, as compared to $14.9
million and $16.3 million at March 31, 2003 and December 31, 2002,
respectively, and represented 0.23% of loans, net, as compared to
0.26% and 0.30%, respectively, at the corresponding dates. Included in
non-performing loans at June 30, 2003 were mortgage loans in
foreclosure totaling $10.7 million and loans 90 days or more
delinquent totaling $2.6 million.
The improvement in non-performing loans occurred in tandem with a
linked-quarter and six-month reduction in the balance of foreclosed
real estate. At June 30, 2003, foreclosed real estate declined to
$66,000 from $121,000 and $175,000, respectively, at March 31, 2003
and December 31, 2002. As a result, non-performing assets improved to
$13.4 million, representing 0.11% of total assets, at the close of the
second quarter from $15.0 million, representing 0.12% of total assets,
and from $16.5 million, representing 0.15% of total assets, at the
corresponding period-ends.
The quality of the Company's loan portfolio was further reflected
in the absence of any net charge-offs in the current second quarter,
making it the 35th consecutive quarter without any net charge-offs
being recorded by the Company. In the absence of any net charge-offs
or provisions for loan losses, the allowance for loan losses was
maintained at $40.5 million, representing 304.15% of non-performing
loans and 0.70% of loans, net, at June 30, 2003.
Securities and Mortgage-backed Securities
The leveraged growth of the balance sheet is substantially
reflected in the growth of the Company's portfolios of securities held
to maturity and available for sale. Securities held to maturity rose
$344.8 million from the balance at year-end 2002 to $1.0 billion at
the close of the second quarter, while the available-for-sale
portfolio rose $324.5 million to $4.3 billion during the same time.
Mortgage-backed securities represented $3.5 billion, or 82.8%, of
available-for-sale securities, with the remainder of the portfolio
consisting primarily of capital trust notes and U.S. Government and
agency obligations.
Mortgage-backed securities held to maturity totaled $24.5 million
at June 30, 2003, down $12.5 million from the balance at year-end
2002. The reduction reflects repayments and the tendency of the
Company to classify new investments in mortgage-backed securities as
available for sale.
Funding Sources
The Company recorded core deposits of $3.4 billion at the close of
the second quarter, representing 66.0% of total deposits at June 30,
2003. By comparison, core deposits totaled $3.3 billion, representing
62.9% of total deposits, at December 31, 2002. The increase was the
net effect of a $79.0 million rise in savings and non-interest-bearing
accounts, combined, to $2.2 billion, and a $19.1 million decline in
NOW and money market accounts to $1.2 billion. The rise in core
deposits since year-end reflects the Company's focus on lower-cost
deposits and a parallel decline in higher-cost depository accounts.
CDs declined $216.1 million to $1.7 billion, representing 34.0% of
total deposits, from the balance recorded at year-end 2002, which
represented 37.1%. The decline in CDs reflects the Company's
aforementioned focus on core deposits and the growing reluctance of
customers to commit their funds long-term during a time of
historically low market interest rates.
Consistent with its leveraged growth strategy, the Company
recorded total borrowings of $5.9 billion at the close of the second
quarter, up $1.3 billion from the balance recorded at December 31,
2002. The increase primarily stemmed from a $173.6 million rise in
FHLB-New York advances to $2.4 billion and a $1.0 billion rise in
reverse repurchase agreements to $3.0 billion. The balance of
borrowings also reflects preferred securities of $429.3 million,
including the trust-preferred securities issued in connection with the
Company's BONUSES(SM) Units and REIT-preferred securities sold by a
Company subsidiary through a private placement in the first quarter of
2003.
Stockholders' Equity
At June 30, 2003, the Company recorded stockholders' equity of
$1.3 billion, up $2.5 million from the balance recorded at December
31, 2002. The 2003 amount was equivalent to 10.70% of total assets and
a book value of $9.89 per share, based on 134,028,072 shares. The
increase in stockholders' equity reflects six-month cash earnings of
$153.9 million, offset by dividend distributions totaling $53.9
million and the allocation of $103.8 million toward the repurchase of
4,184,437 shares during the first six months of the year, including
2,653,933 shares in the second quarter. (1) In connection with the
signing of the merger agreement with Roslyn Bancorp, Inc. on June 27,
2003, the Board of Directors increased its existing share repurchase
authorization, enabling the Company to repurchase up to 5.0 million
shares, which was the number of shares available for repurchase at
June 30, 2003.
Post-earnings Conference Call
The Company will host a conference call on July 16, 2003 at 9:30
a.m. (ET) to discuss highlights of its second quarter 2003 earnings,
its 2003 diluted GAAP EPS projections, and the proposed merger with
Roslyn Bancorp, Inc. The conference call may be accessed by phoning
1-800-238-9007 (domestic) or 1-719-457-2622 (international) and
providing the following access code: 533864. Alternatively, the
conference call may be accessed by visiting the Company's web site,
www.myNYCB.com, clicking on "Investor Relations" and following the
prompts. The web cast will be archived at the Company's web site two
hours following completion of the call through 5:00 p.m. on July 25,
2003; the telephone replay will be available through midnight on July
23rd. To access the replay, please call 1-888-203-1112 (domestic) or
1-719-457-0820 (international) and provide the aforementioned access
code.
New York Community Bancorp, Inc. is the $12.4 billion holding
company for New York Community Bank and the fifth largest thrift in
the nation, based on current market capitalization. The Bank serves
its customers through a network of 110 banking offices in New York
City, Long Island, Westchester County (New York), and New Jersey, and
currently operates through six divisions: Queens County Savings Bank,
Richmond County Savings Bank, CFS Bank, First Savings Bank of New
Jersey, Ironbound Bank, and South Jersey Bank. In addition to
operating the largest supermarket banking franchise in the New York
metro region, with 54 in-store branches, the Bank is one of the
leading producers of multi-family mortgage loans in New York City.
Additional information about the Company and its financial performance
is available at www.myNYCB.com.
New York Community Bancorp, Inc. and Roslyn Bancorp, Inc. will be
filing a joint proxy statement/prospectus and other relevant documents
concerning the merger with the United States Securities and Exchange
Commission (the "SEC"). WE URGE INVESTORS TO READ THE JOINT PROXY
STATEMENT/PROSPECTUS AND ANY OTHER RELEVANT DOCUMENTS TO BE FILED WITH
THE SEC, BECAUSE THEY CONTAIN IMPORTANT INFORMATION.
Investors will be able to obtain these documents free of charge at
the SEC's web site (www.sec.gov). In addition, documents filed with
the SEC by New York Community Bancorp will be available free of charge
from the Investor Relations Department at New York Community Bancorp,
Inc., 615 Merrick Avenue, Westbury, NY 11590. Documents filed with the
SEC by Roslyn Bancorp will be available free of charge from the
Investor Relations Department at Roslyn Bancorp, Inc., One Jericho
Plaza, Jericho, NY 11753.
The directors, executive officers, and certain other members of
management of New York Community Bancorp, Inc. and Roslyn Bancorp,
Inc. may be soliciting proxies in favor of the merger from the
companies' respective shareholders. For information about these
directors, executive officers, and members of management, shareholders
are asked to refer to the most recent proxy statements issued by the
respective companies, which are available on their web sites and at
the addresses provided in the preceding paragraph.
Forward-looking Statements and Associated Risk Factors
This release, the associated post-earnings conference call and web
cast, and other written materials and oral statements made by
management may contain certain forward-looking statements regarding
the Company's prospective performance and strategies 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. The
Company intends such forward-looking statements to be covered by the
safe harbor provisions for forward-looking statements contained in the
Private Securities Litigation Reform Act of 1995, and is including
this statement for purposes of said safe harbor provisions.
Forward-looking statements, which are based on certain assumptions
and describe future plans, strategies, and expectations of the
Company, are generally identified by use of the words "plan,"
"believe," "expect," "intend," "anticipate," "estimate," "project," or
other similar expressions. The Company's ability to predict results or
the actual effects of its plans and strategies, including the proposed
merger with Roslyn Bancorp, Inc., is inherently uncertain.
Accordingly, actual results may differ materially from anticipated
results.
Factors that could have a material adverse effect on the
operations of the Company and its subsidiaries include, but are not
limited to, changes in market interest rates, general economic
conditions, legislation, and regulation; changes in the monetary and
fiscal policies of the U.S. Government, including policies of the U.S.
Treasury and the Federal Reserve Board; changes in the quality or
composition of the loan or investment portfolios; changes in deposit
flows, competition, and demand for financial services, loan, deposit,
and investment products in the Company's local markets; changes in
accounting principles and guidelines; war or terrorist activities; and
other economic, competitive, governmental, regulatory, geopolitical,
and technological factors affecting the Company's operations, pricing,
and services.
The following factors, among others, could cause the actual
results of the proposed merger with Roslyn Bancorp, Inc. to differ
materially from the expectations stated in this release and the
associated conference call and web cast: the ability of the two
companies to obtain the required shareholder or regulatory approvals
of the merger; the ability to effect the proposed restructuring; the
ability of the companies to consummate the merger; the ability to
successfully integrate the companies following the merger; a
materially adverse change in the financial condition of either
company; the ability to fully realize the expected cost savings and
revenues; and the ability to realize the expected cost savings and
revenues on a timely basis.
Specific factors that could cause future results to vary from
current management expectations are detailed from time to time in the
Company's SEC filings, which are available at its web site,
www.myNYCB.com.
Readers are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date of this
release and the associated conference call and web cast. Except as
required by applicable law or regulation, the Company undertakes no
obligation to update these forward-looking statements to reflect
events or circumstances that occur after the date on which such
statements were made.
(1) Please see the reconciliation of cash earnings to GAAP
earnings on page 18 of this release.
(2) Per-share amounts for 2002 have been adjusted to reflect a
4-for-3 stock split on May 21, 2003.
Financial Statements and Highlights Follow
NEW YORK COMMUNITY BANCORP, INC.
CONSOLIDATED STATEMENTS OF CONDITION
(in thousands, except share data)
June 30, December 31,
2003 2002
(unaudited)
------------- -------------
Assets
Cash and due from banks $ 114,093 $ 96,497
Money market investments 1,000 1,148
Securities held to maturity (estimated
market value of $1,086,761 and
$717,564, respectively) 1,044,259 699,445
Mortgage-backed securities held to
maturity (estimated market value
of $25,531 and $38,489, respectively) 24,481 36,947
Securities available for sale 4,276,612 3,952,130
Mortgage loans:
Multi-family 4,939,911 4,494,332
Commercial real estate 535,975 533,327
1-4 family 201,511 265,724
Construction 104,620 117,013
------------- -------------
Total mortgage loans 5,782,017 5,410,396
Other loans 72,704 78,787
Less: Unearned loan fees (3,355) (5,111)
Allowance for loan losses (40,500) (40,500)
------------- -------------
Loans, net 5,810,866 5,443,572
Premises and equipment, net 73,313 74,531
Goodwill 624,518 624,518
Core deposit intangible 48,500 51,500
Deferred tax asset, net 9,855 9,508
Other assets 362,562 323,296
------------- -------------
Total assets $12,390,059 $11,313,092
============= =============
Liabilities and Stockholders' Equity
Deposits:
NOW and money market accounts $ 1,178,931 $ 1,198,068
Savings accounts 1,692,704 1,643,696
Certificates of deposit 1,733,074 1,949,138
Non-interest-bearing accounts 495,138 465,140
------------- -------------
Total deposits 5,099,847 5,256,042
------------- -------------
Official checks outstanding 29,977 11,544
Borrowings 5,861,433 4,592,069
Mortgagors' escrow 19,506 13,749
Other liabilities 53,324 116,176
------------- -------------
Total liabilities 11,064,087 9,989,580
------------- -------------
Stockholders' equity:
Preferred stock at par $0.01 (5,000,000
shares authorized; none issued) -- --
Common stock at par $0.01 (300,000,000
shares authorized; 144,299,233 shares
issued; 138,679,193 and 140,885,952
shares outstanding at June 30, 2003 and
December 31, 2002, respectively) (1) 1,443 1,082
Paid-in capital in excess of par 1,116,482 1,104,899
Retained earnings (substantially
restricted) 337,215 275,097
Less: Treasury stock (5,620,041 and
3,413,281 shares, respectively) (1) (129,088) (69,095)
Unallocated common stock held by ESOP (19,513) (20,169)
Common stock held by SERP (3,113) (3,113)
Unearned common stock held by RRPs (41) (41)
Accumulated other comprehensive income,
net of tax effect 22,587 34,852
------------- -------------
Total stockholders' equity 1,325,972 1,323,512
------------- -------------
Total liabilities and stockholders' equity $12,390,059 $11,313,092
============= =============
(1) Share amounts for 2002 have been adjusted to reflect a 4-for-3
stock split on May 21, 2003.
NEW YORK COMMUNITY BANCORP, INC.
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share data)
(unaudited)
For the For the
Three Months Ended Six Months Ended
June 30, June 30,
---------------------- ----------------------
2003 2002 2003 2002
---------- ---------- ---------- -----------
Interest Income:
Mortgage and other loans $105,710 $105,677 $208,966 $206,130
Securities 22,904 9,469 41,514 17,711
Mortgage-backed securities 33,386 37,004 77,811 69,317
Money market investments 310 153 593 276
---------- ---------- ---------- -----------
Total interest income 162,310 152,303 328,884 293,434
---------- ---------- ---------- -----------
Interest Expense:
NOW and money market
accounts 2,208 4,063 5,994 7,591
Savings accounts 2,889 5,865 7,064 11,692
Certificates of deposit 9,011 15,116 19,787 34,728
Borrowings 39,847 31,819 79,382 60,915
Mortgagors' escrow -- 5 -- 10
---------- ---------- ---------- -----------
Total interest expense 53,955 56,868 112,227 114,936
---------- ---------- ---------- -----------
Net interest income 108,355 95,435 216,657 178,498
Provision for loan losses -- -- -- --
---------- ---------- ---------- -----------
Net interest income
after provision for
loan losses 108,355 95,435 216,657 178,498
---------- ---------- ---------- -----------
Other Operating Income:
Fee income 14,723 10,822 26,362 21,983
Net securities gains 10,581 6,253 17,066 7,783
Other 8,375 10,906 16,692 18,009
---------- ---------- ---------- -----------
Total other operating
income 33,679 27,981 60,120 47,775
---------- ---------- ---------- -----------
Non-interest Expense:
Operating expenses:
Compensation and
benefits 20,142 19,166 38,868 35,653
Occupancy and equipment 5,443 5,575 11,519 11,668
General and
administrative 7,276 7,013 14,906 16,574
Other 1,074 1,570 2,581 3,091
---------- ---------- ---------- -----------
Total operating expenses 33,935 33,324 67,874 66,986
Amortization of core
deposit intangible 1,500 1,500 3,000 3,000
---------- ---------- ---------- -----------
Total non-interest expense 35,435 34,824 70,874 69,986
---------- ---------- ---------- -----------
Income before income taxes 106,599 88,592 205,903 156,287
Income tax expense 34,847 30,463 66,783 51,837
---------- ---------- ---------- -----------
Net income $ 71,752 $ 58,129 $139,120 $104,450
========== ========== ========== ===========
Basic earnings per
share(1) $0.54 $0.43 $1.03 $0.78
Diluted earnings per
share(1) $0.53 $0.43 $1.01 $0.77
========== ========== ========== ===========
(1) Per share amounts for the three and six months ended June 30, 2002
have been adjusted to reflect a 4-for-3 stock split on May 21, 2003.
NEW YORK COMMUNITY BANCORP, INC.
NET INTEREST INCOME ANALYSIS
(dollars in thousands)
(unaudited)
Three Months Ended June 30,
---------------------------------
2003
---------------------------------
Average
Average Yield/
Balance Interest Cost
----------- ---------- ----------
Assets:
Interest-earning assets:
Mortgage and other loans, net $ 5,692,559 $105,710 7.45 %
Securities 1,550,720 22,904 5.92
Mortgage-backed securities 3,505,411 33,386 3.82
Money market investments 55,799 310 2.23
----------- ---------- ----------
Total interest-earning assets 10,804,489 162,310 6.03
Non-interest-earning assets 1,365,065
-----------
Total assets $12,169,554
===========
Liabilities and Stockholders' Equity:
Interest-bearing liabilities:
NOW and money market accounts $ 1,186,501 $ 2,208 0.75 %
Savings accounts 1,694,859 2,889 0.68
Certificates of deposit 1,773,848 9,011 2.04
Mortgagors' escrow 61,686 -- --
----------- ---------- ----------
Total interest-bearing deposits 4,716,894 14,108 1.20
Borrowings 5,010,725 39,847 3.19
----------- ---------- ----------
Total interest-bearing liabilities 9,727,619 53,955 2.22
Non-interest-bearing deposits 490,222
Other liabilities 613,727
-----------
Total liabilities 10,831,568
Stockholders' equity 1,337,986
-----------
Total liabilities and stockholders'
equity $12,169,554
===========
Net interest income/interest rate
spread $108,355 3.81 %
========= =========
Net interest-earning assets/net
interest margin $ 1,076,870 4.02 %
=========== =========
Ratio of interest-earning assets to
interest-bearing liabilities 1.11 x
=========
Three Months Ended June 30,
---------------------------------
2002
---------------------------------
Average
Average Yield/
Balance Interest Cost
----------- ---------- ----------
Assets:
Interest-earning assets:
Mortgage and other loans, net $5,535,656 $105,677 7.66 %
Securities 550,168 9,469 6.90
Mortgage-backed securities 2,433,053 37,004 6.10
Money market investments 28,992 153 2.12
----------- ---------- ----------
Total interest-earning assets 8,547,869 152,303 7.15
Non-interest-earning assets 1,401,646
-----------
Total assets $9,949,515
===========
Liabilities and Stockholders' Equity:
Interest-bearing liabilities:
NOW and money market accounts $1,071,799 $ 4,063 1.52 %
Savings accounts 1,682,433 5,865 1.40
Certificates of deposit 2,010,147 15,116 3.02
Mortgagors' escrow 61,223 5 0.03
----------- ---------- ----------
Total interest-bearing deposits 4,825,602 25,049 2.08
Borrowings 3,150,866 31,819 4.05
----------- ---------- ----------
Total interest-bearing liabilities 7,976,468 56,868 2.86
Non-interest-bearing deposits 480,720
Other liabilities 367,666
-----------
Total liabilities 8,824,854
Stockholders' equity 1,124,661
-----------
Total liabilities and stockholders'
equity $9,949,515
===========
Net interest income/interest rate
spread $ 95,435 4.29 %
======== ==========
Net interest-earning assets/net
interest margin $ 571,401 4.48 %
=========== ==========
Ratio of interest-earning assets to
interest-bearing liabilities 1.07 x
==========
NEW YORK COMMUNITY BANCORP, INC.
NET INTEREST INCOME ANALYSIS
(dollars in thousands)
(unaudited)
Six Months Ended June 30,
---------------------------------
2003
---------------------------------
Average
Average Yield/
Balance Interest Cost
------------ --------- --------
Assets:
Interest-earning assets:
Mortgage and other loans, net $ 5,616,473 $208,966 7.50 %
Securities 1,360,044 41,514 6.16
Mortgage-backed securities 3,663,462 77,811 4.28
Money market investments 48,809 593 2.46
------------ --------- --------
Total interest-earning assets 10,688,788 328,884 6.20
Non-interest-earning assets 1,410,172
------------
Total assets $12,098,960
============
Liabilities and Stockholders' Equity:
Interest-bearing liabilities:
NOW and money market accounts $ 1,190,670 $ 5,994 1.02 %
Savings accounts 1,674,465 7,064 0.85
Certificates of deposit 1,841,243 19,787 2.17
Mortgagors' escrow 47,442 -- --
------------ --------- --------
Total interest-bearing deposits 4,753,820 32,845 1.39
Borrowings 4,847,227 79,382 3.30
------------ --------- --------
Total interest-bearing liabilities 9,601,047 112,227 2.36
Non-interest-bearing deposits 480,259
Other liabilities 682,174
------------
Total liabilities 10,763,480
Stockholders' equity 1,335,480
------------
Total liabilities and stockholders'
equity $12,098,960
============
Net interest income/interest rate
spread $216,657 3.84 %
========= ========
Net interest-earning assets/net
interest margin $ 1,087,741 4.09 %
============ ========
Ratio of interest-earning assets to
interest-bearing liabilities 1.11 x
========
Six Months Ended June 30,
2002
-------------------------------
Average
Average Yield/
Balance Interest Cost
----------- --------- ---------
Assets:
Interest-earning assets:
Mortgage and other loans, net $5,471,297 $206,130 7.60%
Securities 511,720 17,711 6.98
Mortgage-backed securities 2,304,244 69,317 6.07
Money market investments 29,062 276 1.92
----------- --------- ---------
Total interest-earning assets 8,316,323 293,434 7.12
Non-interest-earning assets 1,285,908
-----------
Total assets $9,602,231
===========
Liabilities and Stockholders'
Equity:
Interest-bearing liabilities:
NOW and money market accounts $1,033,429 $ 7,591 1.48%
Savings accounts 1,671,789 11,692 1.41
Certificates of deposit 2,152,471 34,728 3.25
Mortgagors' escrow 49,234 10 0.04
----------- --------- ---------
Total interest-bearing deposits 4,906,923 54,021 2.22
Borrowings 2,900,325 60,915 4.24
----------- --------- ---------
Total interest-bearing liabilities 7,807,248 114,936 2.97
Non-interest-bearing deposits 463,810
Other liabilities 277,741
-----------
Total liabilities 8,548,799
Stockholders' equity 1,053,432
-----------
Total liabilities and
stockholders' equity $9,602,231
===========
Net interest income/interest rate
spread $178,498 4.15%
========= =========
Net interest-earning assets/net
interest margin $ 509,075 4.33%
=========== =========
Ratio of interest-earning assets
to interest-bearing liabilities 1.07x
=========
NEW YORK COMMUNITY BANCORP, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS
(dollars in thousands, except share data)
(unaudited)
For the For the
Three Months Ended Six Months Ended
June 30, June 30,
-------------------------- --------------------------
2003 2002 2003 2002
------------- ------------ ------------- ------------
GAAP EARNINGS
DATA:
Net income $71,752 $58,129 $139,120 $104,450
Basic earnings
per share (1) 0.54 0.43 1.03 0.78
Diluted
earnings per
share (1) 0.53 0.43 1.01 0.77
Return on
average assets 2.36% 2.34% 2.30% 2.18%
Return on average
stockholders'
equity 21.45 20.67 20.83 19.83
Return on average
tangible
stockholders'
equity 43.16 52.16 42.00 55.78
Operating
expenses to
average assets 1.12 1.34 1.12 1.40
Interest rate
spread 3.81 4.29 3.84 4.15
Net interest
margin 4.02 4.48 4.09 4.33
Efficiency ratio 23.89 27.00 24.52 29.60
Shares used
for basic EPS
computation(1) 132,341,080 135,424,712 134,552,472 133,464,604
Shares used for
diluted EPS
computation(1) 135,541,527 136,981,908 137,090,145 134,901,285
RECONCILIATION OF
CASH EARNINGS TO
GAAP EARNINGS:
Net income $71,752 $58,129 $139,120 $104,450
Additional
contributions to
tangible
stockholders'
equity:
Amortization and
appreciation of
shares held in
stock-related
benefit plan 2,110 1,559 3,821 2,988
Associated tax
benefits 8,250 -- 9,057 14,728
Dividends on
unallocated ESOP
shares 1,010 661 1,911 1,190
Amortization of
core deposit
intangible 1,500 1,500 3,000 3,000
------------ ------------ ------------ ------------
Total additional
contributions to
tangible
stockholders'
equity 12,870 3,720 17,789 21,906
------------ ------------ ------------ ------------
Cash earnings $84,622 $61,849 $156,909 $126,356
============ ============ ============ ============
Basic cash
earnings per
share (1) $0.64 $0.46 $1.17 $0.95
Diluted cash
earnings per
share (1) 0.62 0.45 1.14 0.94
============ ============ ============ ============
CASH EARNINGS
DATA:
Cash return on
average assets 2.78% 2.49% 2.59% 2.63%
Cash return on
average
stockholders'
equity 25.30 22.00 23.50 23.99
Cash efficiency
ratio 22.41 25.74 23.14 28.28
============ ============ ============ ============
At At
June 30, December 31,
------------ ------------
2003 2002
------------ ------------
BALANCE SHEET DATA:
Book value per share (1) $9.89 $9.73
Stockholders' equity to total
assets 10.70% 11.70%
Shares used for book value
computation (1) 134,028,072 136,078,457
Total shares issued and
outstanding (1) 138,679,193 140,885,952
ASSET QUALITY RATIOS:
Non-performing loans to loans,
net 0.23% 0.30%
Non-performing assets to total
assets 0.11 0.15
Allowance for loan losses to
non-performing loans 304.15 247.83
Allowance for loan losses to
loans, net 0.70 0.74
(1) 2002 amounts have been adjusted to reflect a 4-for-3 stock split
on May 21, 2003.
CONTACT: New York Community Bancorp, Inc.
Ilene A. Angarola, 516-683-4420