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Astoria Financial Corporation Reports Fourth Quarter Earnings And Full Year Earnings Per Share Of $0.17 And $0.55, Respectively

Quarterly Cash Dividend of $0.04 Per Share Declared; Sets Annual Shareholder Meeting Date

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LAKE SUCCESS, N.Y., Jan. 23, 2013 /PRNewswire/ -- Astoria Financial Corporation (NYSE: AF) ("Astoria," the "Company"), the holding company for Astoria Federal Savings and Loan Association ("Astoria Federal"), today reported net income of $16.9 million, or $0.17 diluted earnings per share ("diluted EPS"), for the quarter ended December 31, 2012, compared to net income of $11.8 million, or $0.12 diluted EPS, for the quarter ended December 31, 2011.  For the year ended December 31, 2012, net income totaled $53.1 million, or $0.55 diluted EPS, compared to net income of $67.2 million, or $0.70 diluted EPS, for the year ended December 31, 2011. 

Included in the 2012 fourth quarter net income is a $6.0 million ($3.9 million, or $0.04 per share, after tax) gain resulting from the sale of the Company's entire holdings of Freddie Mac preferred stock and a $2.2 million ($1.4 million, or $0.02 per share, after-tax) charge related to the previously announced settlement of employment agreements associated with executive retirements in the 2012 first quarter.  Also included in the 2012 full year net income are net charges totaling $3.4 million, ($2.2 million, or $0.02 per share, after-tax), representing severance related expenses associated with cost control initiatives implemented in the 2012 first quarter and a $1.2 million expense ($785,000, or $0.01 per share, after-tax) related to the early extinguishment of debt in the 2012 third quarter. 

Financial Highlights

  • Loan Portfolio Shift Continues: Higher-yielding multi-family/commercial real estate loans ("MF/CRE") continue to become a larger percentage of the loan portfolio; increased to 24% of total loans from 18% a year ago.
  • Greater Core Deposit Concentration: Lower cost core deposits continue to become a larger percentage of deposit liabilities; increased to 62% of total deposits from 51% a year ago; business deposits increased 12% from a year ago to $489.3 million.
  • Cost Control Initiatives Continue to Benefit Operating Efficiency.
  • Delinquent Loans, Non-performing Loans and REO Continue to Decline.

Commenting on the 2012 fourth quarter results, Monte N. Redman, President and Chief Executive Officer of Astoria, stated, "I am pleased to report continued improvements in the asset and liability mix which reflect our success in repositioning the balance sheet from lower yielding residential mortgage loans to higher yielding MF/CRE loans and from higher cost CD accounts to lower cost core deposits.  These efforts had a positive benefit on the net interest margin.  Additionally, our focus on controlling operating expenses and continued improvement in asset quality provides a positive contribution to earnings."

Board Declares Quarterly Cash Dividend of $0.04 Per Share; Sets Annual Shareholder Meeting Date
The Board of Directors of the Company, at its January 23, 2013 meeting, declared a quarterly cash dividend of $0.04 per common share.  The dividend is payable on March 1, 2013 to shareholders of record as of February 15, 2013.  This is the seventy-first consecutive quarterly cash dividend declared by the Company. The Board also established May 15, 2013 as the date for the Annual Meeting of Shareholders, with a voting record date of March 25, 2013.

Fourth Quarter and Full Year Earnings Summary
Net interest income for the quarter ended December 31, 2012 totaled $87.4 million compared to $86.0 million for the previous quarter and $87.5 million for the 2011 fourth quarter.  For the year ended December 31, 2012, net interest income totaled $348.3 million compared to $375.4 million for the year ended December 31, 2011.  The net interest margin for the quarter ended December 31, 2012 was 2.21% compared to 2.09% for the previous quarter and 2.20% for the 2011 fourth quarter.  The margin for the previous quarter was negatively impacted by approximately nine basis points due to the additional short-term carrying cost of an additional $250 million of senior notes whose proceeds were used to repay the Company's 5.75% senior notes in September.  For the year ended December 31, 2012, the net interest margin was 2.16% compared to 2.30% for the year ended December 31, 2011. 

For the quarter ended December 31, 2012, a $10.9 million provision for loan losses was recorded, which compares to $9.5 million for the previous quarter and $10.0 million for the comparable 2011 quarter.  For the year ended December 31, 2012, the provision for loan losses totaled $40.4 million compared to $37.0 million for the year ended December 31, 2011.   

Non-interest income totaled $21.6 million for the quarter ended December 31, 2012 compared to $16.6 million for the previous quarter and $17.3 million for the 2011 fourth quarter.  For the year ended December 31, 2012, non-interest income totaled $73.2 million compared to $68.9 million for the year ended December 31, 2011.  The 2012 fourth quarter and full year non-interest income includes a $6.0 million gain on sale of securities resulting from the sale of the Company's Freddie Mac preferred stock in the 2012 fourth quarter.  The sale of the stock, which had been written off in prior years as an impaired asset for book purposes, had the effect of reducing the Company's net deferred tax asset ("DTA") and eliminated the potential risk for the exclusion of the DTA related to the Freddie Mac stock from regulatory capital in future periods.

General and administrative ("G&A") expense for the quarter ended December 31, 2012 totaled $73.2 million compared to $72.6 million for the previous quarter and $77.2 million for the 2011 fourth quarter.   For the year ended December 31, 2012, G&A expense totaled $300.1 million compared to $301.4 million for the year ended December 31, 2011.   The fourth quarter G&A expense includes a $2.2 million settlement charge associated with previously announced executive retirements.  The full year 2012 expense includes net charges totaling $5.6 million representing severance related expenses associated with cost control initiatives implemented in the 2012 first quarter, including the 2012 fourth quarter settlement charge, and a $1.2 million expense related to the early extinguishment of debt in the 2012 third quarter.

Impact from Hurricane Sandy
Repair and recovery costs as a result of Hurricane Sandy reflected in non-interest expense totaled $855,000.  In addition, in support of the communities we serve, the Company contributed relief donations of $154,000 and waived banking fees of approximately $328,000 for customers impacted by the storm.  From a credit standpoint, we have not currently experienced any notable increase in missed loan payments.

Balance Sheet Summary
Total assets decreased $525.4 million from December 31, 2011 to $16.5 billion at December 31, 2012.  The decline is primarily attributable to a decrease in the securities portfolio.  The net decline in the loan portfolio, down $50.6 million year-over-year, reflects the changing mix in the loan composition, with multi-family loans increasing and residential loans decreasing as a percentage of the total loan portfolio.

The residential (one-to-four family) loan portfolio decreased $528.2 million from September 30, 2012 and $850.3 million from December 31, 2011 to $9.7 billion at December 31, 2012.  The decline was due to the pace of residential loan prepayments exceeding the pace of residential loan originations due to historic low interest rates for 30-year fixed rate conforming loans, thereby making the hybrid ARM product less attractive to borrowers.  For the quarter and year ended December 31, 2012, residential loan originations for portfolio totaled $220.4 million and $2.5 billion, respectively, compared to $1.1 billion and $3.5 billion, respectively, for the comparable 2011 periods.  The loan-to-value ratio of the residential loan production for portfolio for the 2012 fourth quarter and full year averaged approximately 59% and 60%, respectively, at origination and the loan amount averaged approximately $782,000 and $738,000, respectively.  Residential loan prepayments for the quarter and year ended December 31, 2012 totaled $633.7 million and $2.9 billion, respectively, compared to $996.0 million and $3.3 billion, respectively, for the comparable 2011 periods.  "We expect the level of residential loan prepayments to continue to remain elevated and residential ARM loan production to remain tepid as 30-year fixed rate mortgage interest rates are expected to remain at historic lows for some time," Mr. Redman noted.

The combined MF/CRE portfolios increased $203.4 million, or 7%, from September 30, 2012 and $827.0 million, or 35%, from December 31, 2011 to $3.2 billion at December 31, 2012, and represents 24% of the total loan portfolio.  For the quarter and year ended December 31, 2012, MF/CRE loan originations totaled $383.4 million and $1.6 billion, respectively, compared to $202.9 million and $204.0 million, respectively, for the comparable 2011 periods.  The $1.6 billion of MF/CRE loans originated during 2012 have loan to value ratios averaging approximately 53% at origination and balances averaging approximately $3.1 million with a weighted average coupon of 3.63%.  Commenting on the loan volume, Mr. Redman noted, "I am very pleased that our 2012 MF/CRE loan production exceeded our expectations, which demonstrates the success achieved since re-entering this business in late 2011.  We remain confident that our continued focus on MF/CRE lending will further enhance our franchise and benefit the net interest margin and future profitability."  MF/CRE loan prepayments for the quarter and year ended December 31, 2012 totaled $150.6 million and $694.8 million, respectively, compared to $182.4 million and $684.9 million for the comparable 2011 periods. 

The securities portfolio declined $242.4 million, or 11%, from September 30, 2012 and $438.6 million, or 18%, from December 31, 2011 and totaled $2.0 billion at December 31, 2012 representing 12% of total assets at December 31, 2012.  

Deposits decreased $94.9 million from September 30, 2012 and $801.7 million from December 31, 2011 and totaled $10.4 billion at December 31, 2012.   These declines are due to decreases of $363.9 million and $1.6 billion, respectively, in high cost CDs, offset by increases of $269.0 million and $757.0 million, respectively, in low cost core deposits.  Core deposits, which totaled $6.5 billion, or 62% of total deposits, at December 31, 2012, had an average cost of 20 basis points for the 2012 fourth quarter.  The growth in core deposits is a result of our efforts to reposition the mix of both assets and liabilities.  Business core deposits for the year 2012 increased 12% and totaled $489.3 million at December 31, 2012.  Mr. Redman, commenting on the growth in business banking, stated, "Our business banking expansion initiatives helped facilitate the growth in our core deposits and are generating new core relationships within the community and deepening our existing relationships."  

Borrowings decreased $435.9 million from September 30, 2012 and increased $251.9 million from December 31, 2011 to $4.4 billion at December 31, 2012.  During the full year 2012, we extended $700.0 million of borrowings with a weighted average rate of 1.05% and a weighted average term of 46 months,  excluding the 5.00% Senior Notes issued in June 2012, the proceeds of which were used to redeem our 5.75% Senior Notes in September 2012.  In addition, notwithstanding the decline in CDs, during the full year of 2012, we extended $672.2 million of CDs for terms of two years or more.  These transactions were initiated in an effort to help limit our exposure to future increases in interest rates.  At December 31, 2012, our one year interest rate sensitivity gap was positive 13.23%.

Stockholders' equity totaled $1.3 billion, or 7.84% of total assets, at December 31, 2012.  Astoria Federal continues to be well-capitalized with leverage, tangible, total risk-based and Tier 1 risk-based capital ratios of 9.24%, 9.24%, 16.49% and 15.23%, respectively, at December 31, 2012.

Asset Quality
Non-performing loans ("NPLs"), including troubled debt restructurings ("TDRs") of $32.8 million, totaled $315.1 million, or 1.91% of total assets, at December 31, 2012, a decrease of $7.1 million from the previous quarter and $17.8 million from December 31, 2011.  As a result of the implementation of regulatory guidance, the Company has reflected $12.5 million of residential loans in Chapter 7 bankruptcy as TDRs, of which $5.7 million were newly included in NPLs, even though less than 90 days delinquent, as of year-end 2012.  At December 31, 2012, residential NPLs totaled $291.1 million, MF/CRE NPLs totaled $17.5 million and consumer and other NPLs totaled $6.5 million, compared to $294.7 million, $21.4 million and $6.1 million, respectively, at September 30, 2012.  Of the $291.1 million of residential NPLs, $242.0 million, or 83%, represent residential loans which, at 180 days delinquent and annually thereafter, were reviewed and charged-off, as needed, to the estimated fair value of the underlying collateral at such time, less estimated selling costs.

The following table illustrates a two-year migration for loan delinquencies:

($ in millions)

30-59 Days

Past Due

60-89 Days

Past Due

Combined

30-89 Days

Past Due

90 + Days

Past Due

(NPLs)

Total 30+

 Days Past Due

At Dec. 31, 2010

$165.8

$  54.3

$220.1

$390.7

$610.8

At Dec. 31, 2011

$166.7

$  48.8

$215.5

$332.9

$548.4

At Dec. 31, 2012

$145.0

$  36.9

$181.9

$315.1

$497.0

The table below details, as of December 31, 2012, the ten largest concentrations by state of residential loans and the respective non-performing loan totals in those states. 



 ($ in millions)

State

Residential

Loans

% of Total

Residential Loan

Portfolio

Total

Residential

NPLs

Residential

NPLs as %

of State Total

New York

$2,790.8

28.7%

$43.0

1.54%

Illinois

$1,036.2

10.7%

$40.7

3.93%

Connecticut

$1,031.5

10.6%

$30.2

2.93%

Massachusetts

$  797.0

8.2%

$  7.8

0.98%

New Jersey

$  717.1

7.4%

$58.3

8.13%

Virginia

$  591.2

6.1%

$11.5

1.95%

California

$  582.5

6.0%

$26.2

4.50%

Maryland

$  567.0

5.8%

$33.0

5.82%

Washington

$  269.1

2.8%

$ 3.7

1.37%

Texas

$  253.0

2.6%

$ 0.1

0.04%

Top 10 States

$ 8,635.4

88.9%

$254.5

2.95%

All other states (1,2)

$ 1,075.8

11.1%

$  36.6

3.40%

Total Portfolio

$ 9,711.2

100.0%

$291.1

3.00%

(1) Includes 25 states and Washington, D.C.

(2) Includes Florida with $172.7 million total loans, of which $18.1 million are non-performing loans.



Selected Asset Quality Metrics

(at or for the three months ended December 31, 2012, except as noted)

($ in millions)

Residential

Multi-

family

CRE

Consumer

 & Other

Total

Loan portfolio balance

$ 9,711.2

$ 2,406.7

$ 773.9

    $  264.1(1)

$13,224.0 (2)

Non-performing loans

 $    291.1 (3)(4)

$     10.7(5)

$    6.9

$     6.5

$     315.1(6)

NPLs/total loans

2.20%

0.08%

0.05%

0.05%

2.38%

Net charge-offs  4Q12

$       9.8

$       3.1

$  0.9

$     0.1

$       13.9

Net charge-offs YTD

$     41.4

$       6.1

$  2.6

$     2.0

$       52.1

(1) Includes home equity loans of $231.9 million

(2) Includes $68.1 million of net unamortized premiums and deferred loan costs

(3) Includes $242.0 million of NPLs reviewed, and charged-off as needed, at 180 days delinquent and annually thereafter

(4) Includes $26.5 million of TDRs

(5) Includes $5.8 million of TDRs

(6) Does not foot due to rounding

Included in the 2012 fourth quarter residential net loan charge-offs are $8.0 million of charge-offs on $50.5 million of NPLs which, at 180 days delinquent and annually thereafter, were reviewed in the 2012 fourth quarter and charged-off, as needed, to the estimated fair value of the underlying collateral less estimated selling costs.  "While the trend of lower NPLs is continuing, we expect NPL levels will remain somewhat elevated for some time, especially in those states requiring judicial foreclosure.  It is important to note that the loss potential remaining has been greatly reduced as a result of our having already reviewed, marked down, and charged-off as necessary, 83% of the residential NPLs to their adjusted fair value less estimated selling costs," Mr. Redman noted.

Future Outlook 
Commenting on the outlook for 2013, Mr. Redman stated, "With the yield curve remaining flat and interest rates expected to remain at historic lows for the near term, the operating environment for financial institutions remains challenging.  We will, therefore, continue to concentrate on growing the MF/CRE loan portfolio and increasing low-cost core deposits, particularly through the expansion of our business banking platform in 2013.  This will include the addition of seasoned business relationship managers to accelerate business deposit growth, coupled with the opening of several branches in select communities that offer increased opportunities to extend our business banking footprint.  While these initiatives are expected to result in higher G&A expenses this year, we expect that they will further enhance the value of our franchise and improve future profitability. In addition, the positive effect of the balance sheet repositioning should help mitigate the negative impact of the low interest rate environment and allow us to maintain a net interest margin for 2013 at, or slightly higher than, the margin for the 2012 full year."

Earnings Conference Call January 24, 2013 at 10:00 a.m. (ET)
The Company, as previously announced, indicated that Monte N. Redman, President & CEO will host an earnings conference call Thursday morning, January 24, 2013 at 10:00 a.m. (ET).   The toll-free dial-in number is (877) 709-8150.  A telephone replay will be available on January 24, 2013 from 1:00 p.m. (ET) through midnight, Saturday, February 2, 2013.  The replay number is (877) 660-6853, ID# 405678.  The conference call will also be simultaneously webcast on the Company's website www.astoriafederal.com and archived for one year.

Astoria Financial Corporation, with assets of $16.5 billion, is the holding company for Astoria Federal Savings and Loan Association.  Established in 1888, Astoria Federal, with deposits in New York totaling $10.4 billion, is the largest thrift depository in New York and embraces its philosophy of "Putting people first" by providing the customers and local communities it serves with quality financial products and services through 85 convenient banking office locations and multiple delivery channels, including its enhanced website, 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 residential mortgage loans through its banking and loan production offices in New York, a broker network in four states, primarily along the East Coast, and through correspondent relationships covering nine states and the District of Columbia.  Astoria Federal also originates multi-family and commercial real estate loans, primarily on rent controlled and rent stabilized apartment buildings, located in New York City and the metropolitan area.

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," "may," "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 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 areas in which we do business, or conditions in the real estate or securities markets or the banking industry may be less favorable than we currently anticipate; legislative or regulatory changes, including the implementation of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, and any actions regarding foreclosures may adversely affect our business; transition of our regulatory supervisor from the Office of Thrift Supervision to the Office of the Comptroller of the Currency and the Board of Governors of the Federal Reserve Board, or FRB; effects of changes in existing U.S. government or government-sponsored mortgage programs; 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 other matters before regulatory agencies, whether currently existing or commencing in the future, may be determined adverse to us or may delay the occurrence or non-occurrence of events longer than we anticipate. We have no obligation to update any forward-looking statements to reflect events or circumstances after the date of this document.

Tables Follow

 

ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES













CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION





(In Thousands, Except Share Data)










At


At






December 31,


December 31,






2012


2011

ASSETS






Cash and due from banks

$

121,473

$

132,704

Securities available-for-sale


336,300


344,187

Securities held-to-maturity





     (fair value of $1,725,090 and $2,176,925, respectively)


1,700,141


2,130,804

Federal Home Loan Bank of New York stock, at cost


171,194


131,667

Loans held-for-sale, net


76,306


32,394

Loans receivable:





     Mortgage loans, net


12,958,999


12,990,600

     Consumer and other loans, net


264,973


284,004






13,223,972


13,274,604

     Allowance for loan losses


(145,501)


(157,185)

Total loans receivable, net





13,078,471


13,117,419

Mortgage servicing rights, net


6,947


8,136

Accrued interest receivable


41,688


46,528

Premises and equipment, net


115,632


119,946

Goodwill



185,151


185,151

Bank owned life insurance


418,155


409,637

Real estate owned, net


28,523


48,059

Other assets


216,661


315,423









TOTAL ASSETS

$

16,496,642

$

17,022,055









LIABILITIES





Deposits




$

10,443,958

$

11,245,614

Reverse repurchase agreements




1,100,000


1,700,000

Federal Home Loan Bank of New York advances




2,897,000


2,043,000

Other borrowings, net




376,496


378,573

Mortgage escrow funds




113,101


110,841

Accrued expenses and other liabilities




272,098


292,829









TOTAL LIABILITIES


15,202,653


15,770,857









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 98,419,318 and 98,537,715 shares





     outstanding, respectively)




1,665


1,665

Additional paid-in capital




884,689


875,395

Retained earnings 




1,891,022


1,861,592

Treasury stock (68,075,570 and 67,957,173 shares, at cost, respectively)


(1,406,755)


(1,404,311)

Accumulated other comprehensive loss




(73,090)


(75,661)

Unallocated common stock held by ESOP 







     (967,013 and 2,042,367 shares, respectively)




(3,542)


(7,482)









TOTAL STOCKHOLDERS' EQUITY


1,293,989


1,251,198









TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$

16,496,642

$

17,022,055

 












ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES

















CONSOLIDATED STATEMENTS OF INCOME









(In Thousands, Except Share Data)
























For the Three Months Ended


For the Twelve Months Ended





December 31,


December 31,





2012


2011


2012


2011

Interest income:










Residential mortgage loans

$

86,242

$

101,637

$

372,478

$

433,951


Multi-family and commercial real estate mortgage loans


38,606


37,518


149,694


162,433


Consumer and other loans


2,314


2,412


9,258


9,889


Mortgage-backed and other securities


12,312


18,623


61,757


82,055


Repurchase agreements and interest-earning cash accounts


56


16


338


237


Federal Home Loan Bank of New York stock


2,056


1,297


6,984


6,683

Total interest income


141,586


161,503


600,509


695,248

Interest expense:










Deposits


19,542


31,893


98,021


138,049


Borrowings


34,638


42,079


154,219


181,773

Total interest expense


54,180


73,972


252,240


319,822











Net interest income


87,406


87,531


348,269


375,426

Provision for loan losses


10,900


10,000


40,400


37,000

Net interest income after provision for loan losses


76,506


77,531


307,869


338,426

Non-interest income:










Customer service fees


9,040


10,439


39,520


46,135


Other loan fees


703


786


2,640


3,160


Gain on sales of securities 


6,000


-


8,477


-


Mortgage banking income, net


1,673


1,570


6,820


4,413


Income from bank owned life insurance


2,366


2,655


9,439


10,257


Other


1,861


1,840


6,339


4,950

Total non-interest income


21,643


17,290


73,235


68,915

Non-interest expense:










General and administrative:











Compensation and benefits


34,080


37,952


139,140


151,149



Occupancy, equipment and systems


17,414


16,515


67,406


65,182



Federal deposit insurance premiums


11,763


10,554


47,363


38,083



Advertising


768


1,486


6,392


7,842



Other


9,165


10,741


39,832


39,161

Total non-interest expense


73,190


77,248


300,133


301,417












Income before income tax expense


24,959


17,573


80,971


105,924

Income tax expense


8,043


5,809


27,880


38,715












Net income 

$

16,916

$

11,764

$

53,091

$

67,209























Basic earnings per common share

$

0.17

$

0.12

$

0.55

$

0.70























Diluted earnings per common share

$

0.17

$

0.12

$

0.55

$

0.70












Basic weighted average common shares

95,907,718

93,979,192

95,455,344

93,253,928

Diluted weighted average common and common 










equivalent shares 

95,907,718

93,979,192

95,455,344

92,253,928

 

ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES































AVERAGE BALANCE SHEETS
















(Dollars in Thousands)





























































For the Three Months Ended December 31,









2012







2011














Average







Average








Average 




Yield/



Average 




Yield/








Balance


Interest


Cost



Balance


Interest


Cost












(Annualized)







(Annualized)



Assets:

















     Interest-earning assets:
















          Mortgage loans (1):
















               Residential

$

10,091,712

$

86,242


3.42

%

$

10,647,279

$

101,637


3.82

%


               Multi-family and commercial real estate 


3,058,470


38,606


5.05



2,355,391


37,518


6.37



          Consumer and other loans (1)


268,109


2,314


3.45



288,171


2,412


3.35



          Total loans


13,418,291


127,162


3.79



13,290,841


141,567


4.26



          Mortgage-backed and other securities (2)


2,106,362


12,312


2.34



2,415,348


18,623


3.08



          Interest-earning cash accounts


90,548


56


0.25



54,464


16


0.12



          Federal Home Loan Bank stock 


179,397


2,056


4.58



127,078


1,297


4.08



     Total interest-earning assets



15,794,598


141,586


3.59



15,887,731


161,503


4.07



     Goodwill




185,151







185,151







     Other non-interest-earning assets



768,114







956,675







Total assets



$

16,747,863






$

17,029,557


























Liabilities and stockholders' equity:


















     Interest-bearing liabilities:


















          Savings

$

2,798,866


353


0.05


$

2,737,029


1,750


0.26



          Money market


1,497,279


2,702


0.72



1,031,489


2,181


0.85



          NOW and demand deposit


2,010,158


164


0.03



1,830,974


303


0.07



          Total savings, money market and 
















                 NOW and demand deposit


6,306,303


3,219


0.20



5,599,492


4,234


0.30



          Certificates of deposit


4,126,333


16,323


1.58



5,675,628


27,659


1.95



          Total deposits


10,432,636


19,542


0.75



11,275,120


31,893


1.13



          Borrowings


4,622,347


34,638


3.00



4,024,787


42,079


4.18



     Total interest-bearing liabilities




15,054,983


54,180


1.44



15,299,907


73,972


1.93



     Non-interest-bearing liabilities




394,591







456,406







Total liabilities 




15,449,574







15,756,313







Stockholders' equity




1,298,289







1,273,244







Total liabilities and stockholders' equity



$

16,747,863






$

17,029,557


























Net interest income/



















net interest rate spread (3)





$

87,406


2.15

%



$

87,531


2.14

%


Net interest-earning assets/



















net interest margin (4)



$

739,615




2.21

%

$

587,824




2.20

%


Ratio of interest-earning assets to



















interest-bearing liabilities




1.05x







1.04x































































(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.







(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.








 

 

ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES
































AVERAGE BALANCE SHEETS














(Dollars in Thousands)



























































For the Twelve Months Ended December 31,









2012







2011














Average







Average








Average 




Yield/



Average 




Yield/








Balance


Interest


Cost



Balance


Interest


Cost






















Assets:


















Interest-earning assets:


















Mortgage loans (1):



















Residential

$

10,464,169

$

372,478


3.56

%

$

10,687,593

$

433,951


4.06

%





Multi-family and commercial real estate 


2,739,095


149,694


5.47



2,608,792


162,433


6.23





Consumer and other loans (1)


273,907


9,258


3.38



297,394


9,889


3.33





Total loans


13,477,171


531,430


3.94



13,593,779


606,273


4.46





Mortgage-backed and other securities (2)


2,312,270


61,757


2.67



2,435,028


82,055


3.37





Repurchase agreements and


















       interest-earning cash accounts


142,745


338


0.24



128,396


237


0.18





Federal Home Loan Bank stock 


164,707


6,984


4.24



132,666


6,683


5.04




Total interest-earning assets


16,096,893


600,509


3.73



16,289,869


695,248


4.27




Goodwill


185,151







185,151








Other non-interest-earning assets


824,481







919,617







Total assets

$

17,106,525






$

17,394,637


























Liabilities and stockholders' equity:

















Interest-bearing liabilities:


















Savings

$

2,818,440


4,437


0.16


$

2,762,155


9,562


0.35





Money market


1,318,943


8,944


0.68



616,048


4,551


0.74





NOW and demand deposit


1,933,156


978


0.05



1,798,719


1,175


0.07





Total savings, money market and 


















       NOW and demand deposit


6,070,539


14,359


0.24



5,176,922


15,288


0.30





Certificates of deposit


4,702,693


83,662


1.78



6,156,148


122,761


1.99





Total deposits


10,773,232


98,021


0.91



11,333,070


138,049


1.22





Borrowings


4,624,841


154,219


3.33



4,368,659


181,773


4.16




Total interest-bearing liabilities


15,398,073


252,240


1.64



15,701,729


319,822


2.04




Non-interest-bearing liabilities


430,466







427,225







Total liabilities 


15,828,539







16,128,954







Stockholders' equity


1,277,986







1,265,683







Total liabilities and stockholders' equity

$

17,106,525






$

17,394,637


























Net interest income/

















net interest rate spread (3)



$

348,269


2.09

%



$

375,426


2.23

%


Net interest-earning assets/

















net interest margin (4)

$

698,820




2.16

%

$

588,140




2.30

%


Ratio of interest-earning assets to

















interest-bearing liabilities


1.05x







1.04x































































(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.











(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.









 


ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES
























SELECTED FINANCIAL RATIOS AND OTHER DATA






























For the



At or For the






Three Months Ended



Twelve Months Ended






December 31, 



December 31, 






2012



2011



2012


2011






(Annualized)








Selected Returns and Financial Ratios 













Return on average stockholders' equity 


5.21

%


3.70

%


4.15

%


5.31

%


Return on average tangible stockholders' equity (1)


6.08



4.32



4.86



6.22



Return on average assets 


0.40



0.28



0.31



0.39



General and administrative expense to average assets


1.75



1.81



1.75



1.73



Efficiency ratio (2)


67.12



73.70



71.21



67.83



Net interest rate spread


2.15



2.14



2.09



2.23



Net interest margin


2.21



2.20



2.16



2.30


















Asset Quality Data (dollars in thousands)
















Non-performing assets (3)









$

343,609


$

380,916



Non-performing loans (3)










315,086



332,857



Loans 60-89 days delinquent










36,947



48,815



Loans 30-59 days delinquent










144,932



166,740



Net charge-offs 



$

13,871


$

31,166



52,084



81,314



















Non-performing loans/total loans










2.38

%


2.51

%


Non-performing loans/total assets










1.91



1.96



Non-performing assets/total assets










2.08



2.24



Allowance for loan losses/non-performing loans








46.18



47.22



Allowance for loan losses/total loans










1.10



1.18



Net charge-offs to average loans outstanding 




0.41

%


0.94

%


0.39



0.60


















Capital Ratios (Astoria Federal) 
















Tangible










9.24

%


8.70

%


Leverage










9.24



8.70



Total risk-based










16.49



16.08



Tier 1 risk-based










15.23



14.80


















Other Data 
















Cash dividends paid per common share



$

0.04


$

0.13


$

0.25


$

0.52



Book value per share (4)










13.28



12.97



Tangible book value per share (5)










11.38



11.05



Tangible common stockholders' equity/tangible assets (1) (6)








6.80

%


6.33

%


Mortgage loans serviced for others (in thousands)







$

1,443,672


$

1,446,646



Full time equivalent employees








1,530



1,636



















(1)

Tangible stockholders' equity represents stockholders' equity less goodwill. 



(2)

Efficiency ratio represents general and administrative expense divided by the sum of net interest income plus non-interest income.



(3)

Non-performing assets and non-performing loans include, but are not limited to, residential mortgage loans which at 180 days past due and annually thereafter we obtained an estimate of collateral value and charged-off any portion of the loan in excess of the estimated collateral value less estimated selling costs.


(4)

Book value per share represents stockholders' equity divided by outstanding shares, excluding unallocated Employee Stock Ownership Plan, or ESOP, shares.


(5)

Tangible book value per share represents stockholders' equity less goodwill divided by outstanding shares, excluding unallocated ESOP shares.


(6)

Tangible assets represent assets less goodwill.




 

 

ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES
























END OF PERIOD BALANCES AND RATES












(Dollars in Thousands)
















































At December 31, 2012



At September 30, 2012



At December 31, 2011






Weighted




Weighted




Weighted





Average




Average




Average



  Balance


Rate (1)


  Balance


Rate (1)


  Balance


Rate (1)

Selected interest-earning assets:
















Mortgage loans, gross (2):
















Residential

$

9,420,175


3.73

%

$

9,944,659


3.80

%

$

10,243,672


4.16

%

Multi-family and commercial real estate


3,163,067


4.65



2,955,786


4.90



2,344,655


5.88


Mortgage-backed and other securities (3)


2,036,441


3.26



2,278,796


3.33



2,474,991


3.57


















Interest-bearing liabilities:
















Savings


2,802,298


0.05



2,811,647


0.05



2,750,715


0.25


Money market


1,586,556


0.74



1,438,287


0.53



1,114,404


0.71


NOW and demand deposit


2,094,733


0.03



1,964,636


0.03



1,861,488


0.06


Total savings, money market and
















       NOW and demand deposit


6,483,587


0.21



6,214,570


0.15



5,726,607


0.28


Certificates of deposit


3,960,371


1.55



4,324,312


1.66



5,519,007


1.93


Total deposits


10,443,958


0.72



10,538,882


0.77



11,245,614


1.09


Borrowings, net 


4,373,496


3.03



4,809,366


2.94



4,121,573


3.98


















































(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 non-performing loans.







(3)     Securities available-for-sale are reported at fair value and securities held-to-maturity are reported at amortized cost.

SOURCE Astoria Financial Corporation



RELATED LINKS
http://www.astoriafederal.com

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