Quarterly Cash Dividend of $0.24 Per Common Share Declared
LAKE SUCCESS, N.Y., Oct. 19 /PRNewswire-FirstCall/ -- Astoria Financial
Corporation (NYSE: AF) ("Astoria"), the holding company for Astoria Federal
Savings and Loan Association ("Astoria Federal"), today reported net income
of $41.1 million, or $0.43 diluted earnings per share ("EPS"), for the
quarter ended September 30, 2006, compared to $59.2 million, or $0.57 EPS,
for the 2005 third quarter. For the 2006 third quarter, annualized returns
on average equity, average tangible equity and average assets were 13.06%,
15.31% and 0.76%, respectively, compared to 17.09%, 19.73% and 1.05%,
respectively, for the comparable 2005 period.
For the nine months ended September 30, 2006, net income totaled $137.8
million, or $1.40 EPS, compared to $176.1 million, or $1.69 EPS, for the
comparable 2005 period. For the nine months ended September 30, 2006,
annualized returns on average equity, average tangible equity and average
assets were 14.27%, 16.67% and 0.84%, respectively, compared to 17.06%,
19.71% and 1.02%, respectively, for the comparable 2005 period.
2006 Nine Month Balance Sheet Highlights:
-- Deposits increased $367 million, or 4% annualized
-- Loan portfolio increased $354 million, or 3% annualized
- Multifamily/Commercial Real Estate ("CRE") loan portfolio increased
$215 million, or 7% annualized
- One-to-four family loan portfolio increased $173 million, or 2%
annualized
-- Securities portfolio decreased $974 million, or 20% annualized
-- Borrowings decreased $1.1 billion, or 19% annualized
-- Repurchased 6.5 million shares
Commenting on the 2006 third quarter results, George L. Engelke, Jr.,
Chairman, President and Chief Executive Officer of Astoria, noted, "The
decline in U.S. Treasury bond yields during the third quarter caused a
further inversion of the yield curve which continued to exert pressure on
our net interest margin and earnings while limiting the opportunities for
profitable balance sheet growth. Accordingly, we continued our strategy of
shrinking the balance sheet by reducing the securities portfolio and
borrowings, growing loans and deposits and repurchasing our stock."
Board Declares Quarterly Cash Dividend of $0.24 Per Share
The Board of Directors of the Company, at their October 18, 2006
meeting, declared a quarterly cash dividend of $0.24 per common share. The
dividend is payable on December 1, 2006 to shareholders of record as of
November 15, 2006. This is the forty-sixth consecutive quarterly cash
dividend declared by the Company.
Eleventh Stock Repurchase Program Continues
During the third quarter, Astoria repurchased 1.8 million shares of its
common stock at an average cost of $30.41 per share. During the nine month
period ended September 30, 2006, Astoria repurchased a total of 6.5 million
shares, completing its tenth stock repurchase program and commencing its
eleventh stock repurchase program in the first quarter. Under the current
stock repurchase program, 3.7 million shares of the 10 million shares
authorized remain available for repurchase.
Third Quarter and Nine Month Earnings Summary
Net interest income for the quarter ended September 30, 2006 totaled
$90.7 million compared to $101.3 million for the 2006 second quarter and
$118.5 million for the third quarter a year ago. For the nine months ended
September 30, 2006, net interest income totaled $303.5 million compared to
$365.1 million for the comparable 2005 nine month period.
Astoria's net interest margin for the quarter ended September 30, 2006
declined to 1.75% from 1.92% for the previous quarter and 2.20% for the
quarter ended September 30, 2005, primarily due to the cost of interest-
bearing liabilities rising more rapidly than the yield on interest-earning
assets.
Non-interest income for the quarter ended September 30, 2006 totaled
$22.9 million compared to $28.4 million for the 2005 third quarter. The
decrease is primarily due to lower mortgage banking income, net, primarily
due to the MSR valuation adjustments, as well as lower customer service
fees.
For the nine months ended September 30, 2006, non-interest income
totaled $67.5 million compared to $75.6 million for the comparable 2005
period. The decline was primarily due to a $5.5 million, pre-tax, charge
related to the termination of interest rate swap agreements in the 2006
first quarter, a $1.3 million decrease in mortgage banking income, net, and
a $0.9 million decrease in other loan fees, due primarily to the
outsourcing of mortgage loan servicing effective December 1, 2005.
The components of mortgage banking income, net, which is included in
non- interest income, are detailed below:
(Dollars in millions) 3Q06 3Q05 9 Mos. 06 9 Mos. 05
Loan servicing fees $ 1.1 $ 1.2 $ 3.4 $ 3.8
Amortization of MSR* (0.9) (1.3) (2.8) (4.0)
MSR valuation adjustments (0.5) 2.7 1.5 2.6
Net gain on sale of loans 0.5 1.1 1.7 2.7
Mortgage banking income, net $ 0.2 $ 3.7 $3.8 $ 5.1
* Mortgage servicing rights
General and administrative expense ("G&A") for the quarter ended
September 30, 2006 declined $4.6 million to $53.3 million from $57.9
million for the comparable 2005 period due primarily to a $3.5 million
reduction in compensation and benefits expense and a reduction in other
expense due to an $850,000 reimbursement for certain legal fees. The
decrease in compensation and benefits expense is primarily a result of the
outsourcing of mortgage servicing and further reductions in incentive
compensation accruals, partially offset by increases in stock-based
compensation.
For the nine months ended September 30, 2006, G&A declined $11.2
million to $164.8 million from $176.0 million for the comparable 2005
period. The decrease was predominantly due to a $5.4 million decrease in
compensation and benefits expense, a $5.2 million decrease in other expense
due primarily to lower goodwill litigation expense, and a $1.9 million
decrease in advertising expense, partially offset by a $1.4 million
increase in occupancy, equipment and systems expense primarily related to
the outsourcing of mortgage servicing.
Balance Sheet Summary
The further inversion of the yield curve during the third quarter
continued to narrow spread availability. Accordingly, we continued to
reduce our balance sheet through the reduction of non-core business
activities. Total securities for the quarter ended September 30, 2006
declined $272.2 million, or 19% annualized, to $5.6 billion at September
30, 2006, representing 26% of total assets. Borrowings declined in the
third quarter of 2006 by $378.3 million, or 21% annualized, to $6.8 billion
at September 30, 2006, representing 32% of total assets.
For the nine months ended September 30, 2006, total securities declined
$973.8 million, or 20% annualized, and borrowings declined $1.1 billion, or
19% annualized. Total assets declined $262.3 million from June 30, 2006 and
$781.1 million from December 31, 2005 and total $21.6 billion at September
30, 2006.
Key balance sheet highlights, reflecting the improvement in the quality
of the Company's balance sheet since December 31, 1999, follow:
% Change
(Dollars in 12/31/99-
millions) 12/31/99 12/31/01 12/31/03 12/31/05 09/30/06 09/30/06
Assets $22,700 $22,672 $22,462 $22,380 $21,599 - 5%
Loans $10,286 $12,167 $12,687 $14,392 $14,746 + 43%
Securities $10,763 $8,013 $8,448 $6,572 $5,599 - 48%
Deposits $9,555 $10,904 $11,187 $12,810 $13,177 + 38%
Borrowings $11,528 $9,826 $9,632 $7,938 $6,824 - 41%
The following table illustrates this improvement on an outstanding per
share basis:
Amount
per
share 12/31/99 12/31/01 12/31/03 12/31/05 09/30/06 % Change CAGR
Loans $66.28 $89.36 $107.51 $137.11 $148.46 124% 13%
Deposits $61.57 $80.09 $ 94.80 $122.04 $132.66 115% 12%
Total loan production for the third quarter and nine months ended
September 30, 2006 was $868.6 million and $2.4 billion, respectively,
compared to $1.3 billion and $3.3 billion, respectively, for the comparable
2005 periods. The loan pipeline at September 30, 2006 totaled $1.2 billion,
an increase of $333.5 million, or 41%, over the pipeline at June 30, 2006.
During the 2006 third quarter, the 1-4 family mortgage loan portfolio
increased $107.1 million, or 4% annualized, from the previous quarter and
totaled $9.9 billion at September 30, 2006. For the quarter ended September
30, 2006, 1-4 family loan originations and purchases totaled $706.6 million
compared to $983.4 million for the 2005 third quarter. Of the 2006 third
quarter production, 70% consisted of 3/1 and 5/1 adjustable rate mortgage
loans.
For the nine months ended September 30, 2006, the 1-4 family mortgage
loan portfolio increased $173.3 million, or 2% annualized. For the nine
month period ended September 30, 2006, 1-4 family loan originations and
purchases totaled $1.8 billion compared to $2.4 billion in the year-ago
nine month period. Of the 2006 nine month loan production, 75% consisted of
3/1 and 5/1 adjustable rate mortgage loans.
During the 2006 third quarter, the multifamily and CRE loan portfolio
increased $30.5 million, or 3% annualized, to $4.1 billion, or 28% of total
loans, at September 30, 2006. Multifamily and CRE loan originations totaled
$158.2 million for the 2006 third quarter compared to $270.6 million for
the comparable 2005 period. The average loan-to-value ratio of the
multifamily and CRE loan portfolio continues to be less than 65%, based on
current principal balance and original appraised value, and the average
loan balance is less than $1 million.
For the nine month period ended September 30, 2006, the multifamily and
CRE loan portfolio increased $215.0 million, or 7% annualized. Multifamily
and CRE loan originations totaled $559.4 million for the 2006 nine month
period compared to $769.0 million in the comparable year-ago period.
At September 30, 2006, non-performing loans totaled $55.1 million, or
0.25% of total assets, compared to $54.3 million, or 0.25% of total assets,
at June 30, 2006 and $65.0 million, or 0.29% of total assets, at December
31, 2005. Net charge-offs for the quarter and nine months ended September
30, 2006 totaled $1.1 million and $1.2 million, respectively, compared to
$472,000 and $711,000, respectively, for the comparable 2005 periods. The
increase in charge-offs for the three and nine months ended September 30,
2006 was due, for the most part, to a $947,000 charge-off on a
non-performing loan in foreclosure that was sold in the 2006 third quarter.
The ratio of the allowance for loan losses to non-performing loans at
September 30, 2006 was 145%.
Deposits for the 2006 third quarter increased $84.8 million to $13.2
billion at September 30, 2006. During the 2006 third quarter, our efforts
to extend deposit liabilities resulted in $1.5 billion of non-Liquid CDs
issued or repriced at a weighted average rate of 5.21% with a weighted
average maturity of 12 months.
For the nine months ended September 30, 2006, deposits increased $366.6
million, or 4% annualized.
During that period $4.7 billion of non-Liquid CDs were issued or
repriced at a weighted average rate of 4.83% with a weighted average
maturity of 12 months.
Commenting on the bank's retail activity, Mr. Engelke noted, "Our
marketing efforts continue to produce new customers from our communities,
creating relationship development opportunities for us. For example, during
the nine months ended September 30, 2006, 19% of all new and existing CD
customers, and 22% of all new and existing Liquid CD customers, without
checking accounts, were cross-sold new, low-cost checking accounts, the
linchpin product for building long-term, profitable customer
relationships."
Stockholders' equity was $1.3 billion, or 5.84% of total assets at
September 30, 2006. Astoria Federal continues to maintain capital ratios in
excess of regulatory requirements with core, tangible and risk-based
capital ratios of 6.84%, 6.84% and 12.66%, respectively, at September 30,
2006.
Future Outlook
Commenting on the outlook for the remainder of 2006 and 2007, Mr.
Engelke stated, "The interest rate environment remains very challenging,
characterized by a prolonged flat-to-inverted yield curve that continues to
negatively impact our net interest margin and earnings and limits
opportunities for profitable growth. We anticipate continued margin
compression for the fourth quarter, although the magnitude of the
compression will be less than the current quarter. Looking forward, based
on our economic forecasting model which currently includes three 25 basis
point reductions by the Federal Reserve in 2007 and a gradual flattening of
the yield curve, we expect the margin to remain relatively stable in 2007.
We will, as a result, continue our strategy of shrinking the balance sheet
through reductions in the securities portfolio and borrowings through
normal cash flow, while we emphasize deposit and loan growth, all of which
will continue to improve the quality of both the balance sheet and
earnings. As we reduce the size of the balance sheet, we will continue to
focus on the repurchase of our stock as a very desirable use of capital.
This strategy should better position us to take advantage of more
profitable asset growth opportunities when the yield curve steepens."
Astoria Financial Corporation, the holding company for Astoria Federal
Savings and Loan Association, with assets of $21.6 billion is the fifth
largest thrift institution in the United States. Established in 1888,
Astoria Federal is the largest thrift depository headquartered in New York
with deposits of $13.2 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 38 individual states. Astoria Federal originates mortgage
loans through its banking offices and loan production offices in New York,
an extensive broker network covering twenty-four states, primarily the East
Coast, and the District of Columbia, and through correspondent
relationships covering forty- four states and the District of Columbia.
Earnings Conference Call October 20, 2006 at 9:00 a.m. (ET)
The Company, as previously announced, indicated that Mr. Engelke will
host an earnings conference call Friday morning October 20, 2006 at 9:00
a.m. (ET). The toll-free dial-in number is (800) 967-7140.
A telephone replay will be available on October 20, 2006 from 12 noon
(ET) through Friday, October 27, 2006 11:59 p.m. (ET). The replay number is
(888) 203-1112, passcode: 2849847. The conference call will also be
simultaneously webcast on the Company's website http://www.astoriafederal.com and
archived for one year.
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.
ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(In Thousands, Except Share Data)
At At
September 30, December 31,
2006 2005
ASSETS
Cash and due from banks $152,735 $169,234
Repurchase agreements 54,660 182,803
Securities available-for-sale 1,617,461 1,841,351
Securities held-to-maturity
(fair value of $3,878,082 and
$4,627,013, respectively) 3,981,062 4,730,953
Federal Home Loan Bank of New York
stock, at cost 139,349 145,247
Loans held-for-sale, net 14,629 23,651
Loans receivable:
Mortgage loans, net 14,286,640 13,879,804
Consumer and other loans, net 459,245 512,489
14,745,885 14,392,293
Allowance for loan losses (79,930) (81,159)
Total loans receivable, net 14,665,955 14,311,134
Mortgage servicing rights, net 16,167 16,502
Accrued interest receivable 80,341 80,318
Premises and equipment, net 146,077 151,494
Goodwill 185,151 185,151
Bank owned life insurance 381,886 382,613
Other assets 163,655 159,820
TOTAL ASSETS $21,599,128 $22,380,271
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Deposits $13,177,006 $12,810,455
Reverse repurchase agreements 4,780,000 5,780,000
Federal Home Loan Bank of New York
advances 1,628,527 1,724,000
Other borrowings, net 415,832 433,526
Mortgage escrow funds 165,816 124,929
Accrued expenses and other
liabilities 170,768 157,134
TOTAL LIABILITIES 20,337,949 21,030,044
Stockholders' equity:
Preferred stock, $1.00 par value;
(5,000,000 shares authorized;
none issued and outstanding) - -
Common stock, $.01 par value;
(200,000,000 shares authorized;
166,494,888 shares issued; and
99,326,924 and 104,967,280
shares
outstanding, respectively) 1,665 1,665
Additional paid-in capital 837,567 824,102
Retained earnings 1,839,443 1,774,924
Treasury stock (67,167,964 and
61,527,608 shares, at cost,
respectively) (1,350,189) (1,171,604)
Accumulated other comprehensive
loss (44,421) (49,536)
Unallocated common stock held by
ESOP
(6,246,454 and 6,465,273 shares,
respectively) (22,886) (23,688)
Deferred compensation - (5,636)
TOTAL STOCKHOLDERS' EQUITY 1,261,179 1,350,227
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY $21,599,128 $22,380,271
ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(In Thousands, Except Share Data)
For the For the
Three Months Ended Nine Months Ended
September 30, September 30,
2006 2005 2006 2005
Interest income:
Mortgage loans:
One-to-four family $127,735 $115,118 $378,226 $339,598
Multi-family,
commercial real
estate and
construction 65,933 60,951 192,178 177,447
Consumer and other
loans 9,099 8,199 26,918 22,455
Mortgage-backed and
other securities 64,946 82,072 205,373 264,520
Repurchase
agreements 1,266 1,056 5,205 3,866
Federal Home Loan
Bank of New York
stock 2,049 1,577 5,535 4,400
Total interest income 271,028 268,973 813,435 812,286
Interest expense:
Deposits 102,103 71,903 275,357 203,928
Borrowings 78,258 78,534 234,549 243,262
Total interest expense 180,361 150,437 509,906 447,190
Net interest income 90,667 118,536 303,529 365,096
Provision for loan
losses - - - -
Net interest income
after provision for
loan losses 90,667 118,536 303,529 365,096
Non-interest income:
Customer service fees 16,170 17,798 49,208 49,049
Other loan fees 983 1,397 2,755 3,643
Mortgage banking
income, net 181 3,703 3,810 5,067
Income from bank
owned life insurance 3,957 4,070 12,063 12,435
Other 1,573 1,404 (348) 5,446
Total non-interest income 22,864 28,372 67,488 75,640
Non-interest expense:
General and
administrative:
Compensation and
benefits 27,584 31,060 86,423 91,817
Occupancy,
equipment and
systems 16,104 15,978 49,209 47,790
Federal deposit
insurance premiums 414 432 1,263 1,327
Advertising 1,839 1,765 5,668 7,540
Other 7,374 8,680 22,280 27,516
Total non-interest
expense 53,315 57,915 164,843 175,990
Income before income
tax expense 60,216 88,993 206,174 264,746
Income tax expense 19,122 29,814 68,383 88,692
Net income $41,094 $59,179 $137,791 $176,054
Basic earnings per
common share $0.44 $0.59 $1.44 $1.72
Diluted earnings per
common share $0.43 $0.57 $1.40 $1.69
Basic weighted average
common shares 93,944,367 101,058,022 95,563,670 102,149,797
Diluted weighted
average common
and common
equivalent shares 96,489,271 103,088,233 98,137,080 104,069,045
ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES
SELECTED FINANCIAL RATIOS AND OTHER DATA
For the At or For the
Three Months Ended Nine Months Ended
September 30, September 30,
2006 2005 2006 2005
Selected Returns and
Financial Ratios
(annualized)
Return on average
stockholders' equity 13.06% 17.09% 14.27% 17.06%
Return on average
tangible stockholders'
equity (1) 15.31 19.73 16.67 19.71
Return on average assets 0.76 1.05 0.84 1.02
General and
administrative expense
to average assets 0.98 1.02 1.00 1.02
Efficiency ratio (2) 46.96 39.42 44.43 39.93
Net interest rate
spread (3) 1.64 2.11 1.83 2.13
Net interest margin (4) 1.75 2.20 1.93 2.21
Selected Non-GAAP Returns
and Financial Ratios
(annualized) (5)
Non-GAAP return on
average stockholders'
equity 14.65% 17.06%
Non-GAAP return on
average tangible
stockholders' equity (1) 17.11 19.71
Non-GAAP return on
average assets 0.86 1.02
Non-GAAP efficiency
ratio (2) 43.79 39.93
Asset Quality Data (dollars
in thousands)
Non-performing
loans/total loans 0.37% 0.27%
Non-performing
loans/total assets 0.25 0.17
Non-performing
assets/total assets 0.26 0.17
Allowance for loan
losses/non-performing
loans 145.16 216.39
Allowance for loan
losses/non-accrual loans 146.50 219.22
Allowance for loan
losses/total loans 0.54 0.58
Net charge-offs to
average loans
outstanding (annualized) 0.03% 0.01% 0.01 0.01
Non-performing assets $55,488 $39,213
Non-performing loans 55,063 37,916
Loans 90 days past
maturity but still
accruing interest 502 490
Non-accrual loans 54,561 37,426
Net charge-offs $1,133 $472 1,229 711
Capital Ratios (Astoria
Federal)
Tangible 6.84% 6.20%
Core 6.84 6.20
Risk-based 12.66 12.11
Other Data
Cash dividends paid per
common share $0.24 $0.20 $0.72 $0.60
Dividend payout ratio 55.81% 35.09% 51.43% 35.50%
Book value per share (6) $13.55 $13.81
Tangible book value per
share (7) 11.56 11.97
Average equity/average
assets 5.81% 6.12% 5.86% 5.97%
Mortgage loans serviced
for others (in
thousands) $1,394,240 $1,548,991
Full time equivalent
employees 1,597 1,760
(1) Average tangible stockholders' equity represents average stockholders'
equity less average goodwill.
(2) The efficiency ratio represents general and administrative expense
divided by the sum of net interest income plus non-interest income.
(3) Net interest rate spread represents the difference between the average
yield on average interest-earning assets and the average cost of
average interest-bearing liabilities.
(4) Net interest margin represents net interest income divided by average
interest-earning assets.
(5) The information presented for the nine months ended September 30, 2006
represents pro forma calculations which are not in conformity with
U.S. generally accepted accounting principles, or GAAP. The 2006
information excludes the $3.6 million, after tax, ($5.5 million,
before tax) charge for the termination of our interest rate swap
agreements recorded in the 2006 first quarter. See page 12 for a
reconciliation of GAAP net income to non-GAAP earnings for the nine
months ended September 30, 2006.
(6) Book value per share represents stockholders' equity divided by
outstanding shares, excluding unallocated Employee Stock Ownership
Plan, or ESOP, shares.
(7) Tangible book value per share represents stockholders' equity less
goodwill divided by outstanding shares, excluding unallocated ESOP
shares.
ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES
AVERAGE BALANCE SHEETS
(Dollars in Thousands)
For the Three Months Ended September 30,
2006 2005
Average Average
Average Yield/ Average Yield/
Balance Interest Cost Balance Interest Cost
(Annual- (Annual-
ized) ized)
Assets:
Interest-earning
assets:
Mortgage
loans (1):
One-to-four
family $9,952,037 $127,735 5.13% $9,471,378 $115,118 4.86%
Multi-family,
commercial
real estate
and
construction 4,268,318 65,933 6.18 3,930,711 60,951 6.20
Consumer and
other
loans(1) 468,436 9,099 7.77 529,622 8,199 6.19
Total loans 14,688,791 202,767 5.52 13,931,711 184,268 5.29
Mortgage-
backed
and other
securities(2) 5,774,554 64,946 4.50 7,378,492 82,072 4.45
Repurchase
agreements 95,969 1,266 5.28 122,585 1,056 3.45
Federal Home
Loan Bank
stock 142,998 2,049 5.73 123,199 1,577 5.12
Total interest-
earning
assets 20,702,312 271,028 5.24 21,555,987 268,973 4.99
Goodwill 185,151 185,151
Other non-
interest-
earning
assets 778,978 878,590
Total assets $21,666,441 $22,619,728
Liabilities and
stockholders'
equity:
Interest-
bearing
liabilities:
Savings $2,277,608 2,309 0.41 $2,710,873 2,744 0.40
Money market 506,959 1,281 1.01 767,711 1,866 0.97
NOW and demand
deposit 1,482,642 218 0.06 1,565,633 233 0.06
Liquid
certificates
of deposit 1,243,914 15,184 4.88 393,735 3,053 3.10
Total core
deposits 5,511,123 18,992 1.38 5,437,952 7,896 0.58
Certificates
of deposit 7,505,903 83,111 4.43 7,222,728 64,007 3.54
Total deposits 13,017,026 102,103 3.14 12,660,680 71,903 2.27
Borrowings 7,045,962 78,258 4.44 8,247,037 78,534 3.81
Total interest-
bearing
liabilities 20,062,988 180,361 3.60 20,907,717 150,437 2.88
Non-interest-
bearing
liabilities 344,467 326,857
Total
liabilities 20,407,455 21,234,574
Stockholders'
equity 1,258,986 1,385,154
Total
liabilities
and
stockholders'
equity $21,666,441 $22,619,728
Net interest
income/net
interest
rate spread $90,667 1.64% $118,536 2.11%
Net interest-
earning
assets/net
interest margin $639,324 1.75% $648,270 2.20%
Ratio of interest-
earning assets
to interest-
bearing
liabilities 1.03x 1.03x
(1) Mortgage loans and consumer and other loans include loans held-for-
sale and non-performing loans and exclude the allowance for loan
losses.
(2) Securities available-for-sale are included at average amortized cost.
ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES
AVERAGE BALANCE SHEETS
(Dollars in Thousands)
For the Nine Months Ended September 30,
2006 2005
Average Average
Average Yield/ Average Yield/
Balance Interest Cost Balance Interest Cost
(Annual- (Annual-
ized) ized)
Assets:
Interest-earning
assets:
Mortgage
loans(1):
One-to-four
family $9,921,036 $378,226 5.08% $9,362,018 $339,598 4.84%
Multi-family,
commercial
real estate
and
construction 4,192,095 192,178 6.11 3,813,944 177,447 6.20
Consumer
and other
loans(1) 488,223 26,918 7.35 527,298 22,455 5.68
Total loans 14,601,354 597,322 5.45 13,703,260 539,500 5.25
Mortgage-
backed and
other
secur-
ities(2) 6,098,527 205,373 4.49 7,962,719 264,520 4.43
Repurchase
agreements 145,121 5,205 4.78 184,637 3,866 2.79
Federal Home
Loan Bank
stock 141,577 5,535 5.21 130,618 4,400 4.49
Total interest-
earning
assets 20,986,579 813,435 5.17 21,981,234 812,286 4.93
Goodwill 185,151 185,151
Other non-
interest-
earning
assets 788,337 863,831
Total assets $21,960,067 $23,030,216
Liabilities and
stockholders'
equity:
Interest-
bearing
liabilities:
Savings $2,380,057 7,164 0.40 $2,802,298 8,417 0.40
Money market 563,485 4,135 0.98 843,232 5,825 0.92
NOW and demand
deposit 1,512,951 662 0.06 1,574,350 698 0.06
Liquid
certificates
of deposit 981,897 32,636 4.43 288,023 5,998 2.78
Total core
deposits 5,438,390 44,597 1.09 5,507,903 20,938 0.51
Certificates
of deposit 7,513,758 230,760 4.09 7,054,729 182,990 3.46
Total
deposits 12,952,148 275,357 2.83 12,562,632 203,928 2.16
Borrowings 7,375,315 234,549 4.24 8,757,579 243,262 3.70
Total
interest-
bearing
liabilities 20,327,463 509,906 3.34 21,320,211 447,190 2.80
Non-interest-
bearing
liabilities 345,408 334,032
Total
liabilities 20,672,871 21,654,243
Stockholders'
equity 1,287,196 1,375,973
Total liabilities
and stockholders'
equity $21,960,067 $23,030,216
Net interest
income/net
interest
rate spread $303,529 1.83% $365,096 2.13%
Net interest-
earning
assets/net
interest
margin $659,116 1.93% $661,023 2.21%
Ratio of interest-
earning assets
to interest-
bearing liabilities 1.03x 1.03x
(1) Mortgage loans and consumer and other loans include loans held-for-
sale and non-performing loans and exclude the allowance for loan
losses.
(2) Securities available-for-sale are included at average amortized cost.
ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES
END OF PERIOD BALANCES AND RATES
(Dollars in Thousands)
At September At June At September
30, 2006 30, 2006 30, 2005
Weighted Weighted Weighted
Average Average Average
Balance Balance Balance
Rate(1)
Rate(1) Rate(1)
Selected interest-
earning assets:
Mortgage loans,
gross(2):
One-to-four
family $9,931,184 5.40% $9,824,066 5.32% $9,509,514 5.13%
Multi-family,
commercial real
estate and
construction 4,268,679 5.96 4,245,697 5.95 3,991,029 5.85
Mortgage-backed
and other
securities(3) 5,598,523 4.34 5,870,733 4.34 7,088,515 4.35
Interest-bearing
liabilities:
Savings 2,209,535 0.40 2,352,923 0.40 2,636,201 0.40
Money market 478,932 1.00 537,602 1.01 729,552 0.97
NOW and demand
deposit 1,466,725 0.06 1,535,833 0.06 1,547,769 0.06
Liquid
certificates
of deposit 1,402,562 5.05 1,117,478 4.54 479,372 3.29
Total core
deposits 5,557,754 1.54 5,543,836 1.20 5,392,894 0.64
Certificates of
deposit 7,619,252 4.54 7,548,396 4.26 7,412,756 3.58
Total deposits 13,177,006 3.27 13,092,232 2.96 12,805,650 2.34
Borrowings, net 6,824,359 4.38 7,202,662 4.29 8,099,498 3.84
(1) Weighted average rates represent stated or coupon interest rates
excluding the effect of yield adjustments for premiums, discounts and
deferred loan origination fees and costs and the impact of prepayment
penalties.
(2) Mortgage loans exclude loans held-for-sale and include non-performing
loans.
(3) Securities available-for-sale are reported at fair value and
securities held-to-maturity are reported at amortized cost.
RECONCILIATION OF 2006 GAAP NET INCOME TO NON-GAAP EARNINGS
(In Thousands, Except Per Share Data)
For the Nine Months Ended
September 30, 2006
GAAP Adjustments(4) Non-GAAP
Net interest income after
provision for loan losses $303,529 $ - $303,529
Non-interest income 67,488 5,456 72,944
Non-interest expense 164,843 - 164,843
Income before income tax
expense 206,174 5,456 211,630
Income tax expense 68,383 1,810 70,193
Net income $137,791 $3,646 $141,437
Basic earnings per
common share $1.44 $0.04 $1.48
Diluted earnings per
common share $1.40 $0.04 $1.44
(4) Adjustments relate to the $5.5 million charge for the termination of
our interest rate swap agreements and the related tax effects.
SOURCE Astoria Financial Corporation
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http://ir.astoriafederal.com
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CONTACT:
Peter J. Cunningham, First Vice President,
Investor Relations, +1-516-327-7877, ir@astoriafederal.com
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