FOR IMMEDIATE RELEASE
January 26,2004

Contact: William M. Gilfillan
Executive Vice President and Chief Financial Officer
Phone: (718) 855-3555

Atlantic Liberty Financial Corp.
Reports Earnings for Quarter and Nine Months Ended December 31, 2003,
Declares Quarterly Dividend and Initiates 5% Stock Repurchase Program.

BROOKLYN, NY  Atlantic Liberty Financial Corp,(Nasdaq:ALFC),the holding
company of Atlantic Liberty Savings, F.A.(the Bank) announced earnings
of $346,000 or $0.22 per share for the quarter ended December 31, 2003
as compared to $242,000 or $0.15 per share for the quarter ended
December 31, 2002 an increase of 43%. Earnings for the nine months ended
December 31, 2003 increased 19% to $1,071,000 or $0.67 per share from
$900,000 for the same period in 2002. Earnings per share are calculated
beginning with the date of the Banks conversion from mutual to stock form
(October 22, 2002.) No earnings per share are reported for periods prior
to the conversion.

At its January meeting, the Board of Directors declared a quarterly cash
dividend of $0.05 per share to be paid on February 13, 2004 to shareholders
of record on January 30, 2004.

The Company also announced today that it is commencing a stock repurchase
program to acquire up to 85,550 shares of the Companys Common Stock, which
represents approximately 5% of the outstanding Common Stock.

Barry M. Donohue, President and Chief Executive Officer of the Company,
stated that the Board of Directors has authorized the repurchase program
because the Board considers purchases of the Common Stock by the Company
to be an attractive long term investment. According to Mr. Donohue,
the repurchases generally would be effected through open market purchases,
although he did not rule out the possibility of unsolicited negotiated
transactions or other types of repurchases.

The increase in earnings for the quarter ended December 31, 2003 was
primarily due to increases of $ 86,000 in net interest income and
$19,000 in non-interest income, decreases of $52,000 in non interest
expense and $40,000 in the provision for loan losses, partially offset
by an increase of $93,000 in income tax expense.  The increase in net
interest income for the quarter ended December 31, 2003 compared to the
comparable period in 2002 was attributable to an $8.1 million increase
in interest earning assets.  Our net interest spread was 3.95% for both
periods.  Our net interest margin for the quarter ended December 31, 2003
compared to the same period in 2002 increased 1 basis point to 4.22%
from 4.21%.

Non interest income increased $19,000 due principally to income received
from our investment in Bank Owned Life Insurance (BOLI), as to which there
was no comparable income in the prior period. The decrease in non interest
expense for the quarter ended December 31, 2003 of $52,000 included decreases
of $55,000 in salaries and employee benefits and $45,000 in equipment expense,
partially offset by increases of $19,000 in legal expense and $21,000 in
miscellaneous expense.  There was no provision for loan losses during the
three month period ended December 31, 2003, while we established a provision
of $40,000 for the three month period ended December 31, 2002. The allowance
for loan losses was $582,000 or 0.53% of loans outstanding at December 31, 2003
as compared with $484,000 or 0.48% of loans outstanding at December 31, 2002.
The allowance for loan losses at December 31, 2003 was 481.7% of non-performing
loans and 386.4% of non-performing loans at December 31, 2002.
Non-performing loans represented 0.11% of total loans at December 31, 2003
and 0.12% of total loans at December 31, 2002.

The increase in earnings for the nine months ended December 31, 2003 was
primarily due to increases of $432,000 in net interest income and $77,000
in non interest income, as well as a decrease of $40,000 in the provision
for loan losses partially offset by increases of $177,000 in non interest
expense and $201,000 in income tax expense.  The increase in net interest
income of $432,000 for the nine months ended December 31, 2003 as compared
to the comparable period in 2002 resulted from an increase of $9.1 million
in interest earning assets together with an increase in our net interest
spread of 7 basis points to 4.14% from 4.07%. Our net interest margin for
the nine months ended December 31, 2003 increased 13 basis points to 4.41%
from 4.28% in the prior period.

Non-interest income for the nine months ended December 31, 2003 increased
$77,000 as compared to the nine months ended December 31, 2002 primarily
due to increases of $22,000 in savings and checking account fees and
$69,000 in income on our investment in BOLI for which there was no
comparable income in the prior period, partially offset by a decrease
of $13,000 in loan prepayment penalty fees.  The increase in non-interest
expense of $177,000 was primarily due to increases of $151,000 in salaries
and benefits, $13,000 in Directors compensation, $58,000 in occupancy
expenses, $72,000 in legal expense and $65,000 in miscellaneous expense
partially offset by a decrease of $181,000 in equipment expense.
There was no provision for losses during the nine month period ended
December 31, 2003 versus a provision of $40,000 for the nine month
period ended December 31, 2002.

Our assets increased $23.6 million or 17.2% to $160.8 million at
December 31, 2003 from $137.2 million at March 31, 2003.  During
the nine months ended December 31, 2003, net loans receivable
increased $9.3 million, or 9.2%, to $109.9 million from $100.7
million.  The increase resulted principally from the increased
origination of one-to-four family mortgage loans as well as $12.5
million of commercial mortgages, $5 million of which were purchased
from other financial institutions.

During the nine months ended December 31, 2003, mortgage-backed
securities increased $10.9 million, or 48.0%, to $33.6 million
from $22.7 million at March 31, 2003, reflecting new purchases
of $19.8 million partially offset by pre-payments and amortization
of $ 8.9 million. Other investment securities increased $3.0 million
to $4.0 million at December 31, 2003 from $1.0 million at March 31, 2003.

The increase in assets was primarily funded by a net increase in
advances from the FHLB of New York of $21.6 million to $23.2 million
at December 31, 2003 from $1.6 million at March 31, 2003.  In addition,
deposits of $107.6 million at December 31, 2003 increased $100,000 or
0.1% from $107.5 million at March 31, 2003. Stockholders equity
increased $1.2 million, or 4.6%, to $26.2 million at December 31, 2003
primarily the result of including net income for the nine months ended
December 31, 2003 of $1.1 million.