LAKE SUCCESS, N.Y., Aug. 29 /PRNewswire-FirstCall/ -- Astoria Financial
Corporation (NYSE: AF) ("Astoria"), the holding company for Astoria Federal
Savings & Loan Association ("Astoria Federal"), announced that it has entered
into an outsourcing agreement with Dovenmuehle Mortgage, Inc. ("DMI"), a
mortgage loan servicing company located in Schaumberg, Illinois. Pursuant to
the agreement, DMI will undertake the subservicing of Astoria Federal's loan
portfolio, effective December 2005, on a "private label" basis and will
perform on behalf of Astoria Federal. According to George L. Engelke, Jr.,
Astoria's Chairman, President & CEO, "The decision to take this action was
driven entirely by economics. Our mortgage servicing staff has consistently
performed at high levels. In fact, in my more than 43 years of association
with Astoria Federal, our loan delinquencies have never been lower and remain
among the lowest in the industry. However, in an environment of ever-
increasing competitive pressure, we must and will continue to strive to
increase operating efficiency in all aspects of our operations. Today,
despite the fact that our individual mortgage loan balances are larger, the
number of loans we service has decreased over the past several years, thereby
lowering operating efficiency. DMI currently services loans for multiple
financial institutions and is among the leading subservicers in the country.
We are confident that they will continue to provide our borrowers with the
quality service they have been accustomed to receiving from our mortgage
servicing staff."
The transaction will result in the recording of a charge of approximately
$1 million, pre-tax, in the 2005 third quarter and should result in annual
savings of approximately $2 million, pre-tax, beginning in 2006.
Core Business Growth Continues; Solid Loan Growth Expected in Second Half
of 2005
Astoria indicated that it will continue its strong focus on growing its
core businesses, retail banking and mortgage lending and that this transaction
will improve its already superior operating efficiency. The strong loan
origination platform, which includes retail, broker and correspondent networks
throughout the country, should facilitate continued growth in its loan
portfolios for the remainder of 2005. During the first half of 2005, Astoria
Federal's loan total loan portfolio grew by $487 million, or 7% annualized.
Astoria Financial Corporation, the holding company for Astoria Federal
Savings and Loan Association, with assets of $22.8 billion is the sixth
largest thrift institution in the United States. Established in 1888, Astoria
Federal is the largest thrift depository headquartered in New York with
deposits of $12.6 billion and embraces its philosophy of Putting people first
by providing the customers and local communities it serves with quality
financial products and services through 86 convenient banking office locations
and multiple delivery channels, including its enhanced website,
http://www.astoriafederal.com. Astoria Federal commands the fourth largest
deposit market share in the attractive Long Island market, which includes
Brooklyn, Queens, Nassau and Suffolk counties with a population exceeding that
of 39 individual states. Astoria Federal originates mortgage loans through
its banking offices and loan production offices in New York, an extensive
broker network in twenty-three states, primarily the East Coast and the
District of Columbia, and through correspondent relationships in forty-four
states and the District of Columbia.
Forward Looking Statements
This document contains a number of forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended. These statements may
be identified by the use of such words as "anticipate," "believe," "could,"
"estimate," "expect," "intend," "outlook," "plan," "potential," "predict,"
"project," "should," "will," "would" and similar terms and phrases, including
references to assumptions.
Forward-looking statements are based on various assumptions and analyses
made by us in light of our management's experience and its perception of
historical trends, current conditions and expected future developments, as
well as other factors we believe are appropriate under the circumstances.
These statements are not guarantees of future performance and are subject to
risks, uncertainties and other factors (many of which are beyond our control)
that could cause actual results to differ materially from future results
expressed or implied by such forward-looking statements. These factors
include, without limitation, the following: the timing and occurrence or non-
occurrence of events may be subject to circumstances beyond our control; there
may be increases in competitive pressure among financial institutions or from
non-financial institutions; changes in the interest rate environment may
reduce interest margins or affect the value of our investments; changes in
deposit flows, loan demand or real estate values may adversely affect our
business; changes in accounting principles, policies or guidelines may cause
our financial condition to be perceived differently; general economic
conditions, either nationally or locally in some or all of the areas in which
we do business, or conditions in the securities markets or the banking
industry may be less favorable than we currently anticipate; legislative or
regulatory changes may adversely affect our business; applicable technological
changes may be more difficult or expensive than we anticipate; success or
consummation of new business initiatives may be more difficult or expensive
than we anticipate; or litigation or matters before regulatory agencies,
whether currently existing or commencing in the future, may delay the
occurrence or non-occurrence of events longer than we anticipate. We assume
no obligation to update any forward-looking statements to reflect events or
circumstances after the date of this document.
SOURCE Astoria Financial Corporation
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Related links:
http://www.astoriafederal.com
http://ir.astoriafederal.com
Company News On-Call:
http://www.prnewswire.com/comp/104529.html
CONTACT:
Peter J. Cunningham, First Vice President,
Investor Relations of Astoria Financial Corporation,
+1-516-327-7877, ir@astoriafederal.com
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