ASTORIA FINANCIAL CORP 
By LAKE SUCCESS, N.Y., Jan. 25, 2012 /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 $11.8 million, or $0.12 diluted earnings per share ("diluted EPS"), for the quarter ended December 31, 2011 compared to net income of $23.8 million, or $0.25 diluted EPS, for the quarter ended December 31, 2010. For the year ended December 31, 2011, net income totaled $67.2 million, or $0.70 diluted EPS compared to net income of $73.7 million, or $0.78 diluted EPS, for the year ended December 31, 2010. The year ended December 31, 2010 includes net charges totaling $3.2 million ($2.1 million, or $0.02 per share, after-tax), which are not routine to our core operations. For further details, please refer to the "Reconciliation of GAAP Measures to Non-GAAP Measures" table included in this release.
Commenting on the 2011 fourth quarter and full year results, Monte N. Redman, President and Chief Executive Officer of Astoria, stated, "The declines in fourth quarter and full year earnings were due to significant decreases in average interest-earning assets from the comparable 2010 periods, primarily due to declines in both our one-to-four family ("residential") and multi-family and commercial real estate ("CRE") loan portfolios. The decline in the residential loan portfolio was due primarily to the effect of continued elevated levels of mortgage prepayment activity resulting from government programs designed to keep 30-year fixed-rate conforming loan interest rates at historic low levels. The decline in the multi-family/CRE loan portfolio was due to the absence of lending in this market during much of 2011. The resumption of multi-family/CRE lending, which began in the 2011 third quarter and is demonstrating solid growth as evidenced by the fourth quarter originations and year-end pipeline, should help to mitigate the negative impact of U.S. government programs that impede our ability to grow the residential loan portfolio profitably. Accordingly, we anticipate average interest-earning assets to begin increasing modestly in the 2012 first quarter and more robustly as the year progresses."
Full Year Financial Highlights
-- Low cost savings, money market and checking account deposits increased
$910.7 million, or 19%, to $5.7 billion, or 51% of total deposits.
-- Total non-performing loans decreased $57.8 million, or 15%, to $332.9
million.
-- The Company's tangible common equity ratio increased 43 basis points to
6.33%.
-- Astoria Federal's leverage and tangible capital ratios increased 76
basis points to 8.70%.
-- Astoria Federal's Tier 1 risk-based capital ratio increased 147 basis
points to 14.80%.
-- Residential loan originations for portfolio totaled $3.5 billion,
multi-family/CRE loan originations totaled $204.0 million
Board Declares Quarterly Cash Dividend of $0.13 Per Share; Sets Annual Shareholder Meeting Date
The Board of Directors of the Company, at their January 25, 2012 meeting, declared a quarterly cash dividend of $0.13 per common share. The dividend is payable on March 1, 2012 to shareholders of record as of February 15, 2012. This is the sixty-seventh consecutive quarterly cash dividend declared by the Company. The Board also established May 16, 2012 as the date for the Annual Meeting of Shareholders, with a voting record date of March 26, 2012.
Fourth Quarter and Full Year Earnings Summary
Net interest income for the quarter ended December 31, 2011 totaled $87.5 million compared to $90.6 million for the previous quarter and $101.2 million for the 2010 fourth quarter. For the year ended December 31, 2011, net interest income totaled $375.4 million compared to $433.6 million for the year ended December 31, 2010. The decreases in net interest income for the year over year quarter and full year periods are due primarily to a decline in average interest-earning assets of $1.6 billion and $2.1 billion, respectively.
The net interest margin for the quarter ended December 31, 2011 was 2.20% compared to 2.27% for the previous quarter and 2.32% for the 2010 fourth quarter. For the year ended December 31, 2011, the net interest margin was 2.30% compared to 2.35% for the year ended December 31, 2010.
For the quarter ended December 31, 2011, a $10.0 million provision for loan losses was recorded, which was equal to the provision for the previous quarter and 33% lower than the $15.0 million provision recorded for the 2010 fourth quarter. For the year ended December 31, 2011, the provision for loan losses totaled $37.0 million, 68% lower than the $115.0 million provision for the year ended December 31, 2010.
Non-interest income for the quarter ended December 31, 2011 totaled $17.3 million compared to $16.5 million for the previous quarter and $20.7 million for the 2010 fourth quarter. Non-interest income for the year ended December 31, 2011 totaled $68.9 million compared to $81.2 million for the year ended December 31, 2010. The decrease for the year ended December 31, 2011 is primarily due to a $6.2 million gain relating to a litigation settlement recorded in 2010, a decrease of $5.1 million in customer service fees and net gains of $2.1 million on sales of non-performing loans held-for-sale recorded in 2010, partially offset by a $1.5 million impairment write-down of premises and equipment recorded in 2010.
General and administrative ("G&A") expense for the quarter ended December 31, 2011 totaled $77.2 million, a $1.3 million decline from the previous quarter and a $7.3 million increase from the 2010 fourth quarter. The linked quarter decrease is due primarily to decreases in compensation and benefits expense and advertising expense, partially offset by an increase in other expense. The quarterly year over year increase is primarily due to a $4.5 million increase in FDIC deposit insurance expense and a $2.3 million increase in compensation and benefits expense, including a $1.1 million increase in non-cash ESOP expense.
For the year ended December 31, 2011, G&A expense totaled $301.4 million compared to $284.9 million for the year ended December 31, 2010. The increase is due primarily to a $12.4 million increase in FDIC deposit insurance expense and a $9.6 million increase in compensation and benefits expense, primarily ESOP and pension expense, partially offset by a $7.9 million litigation settlement expense recorded in 2010.
Expense Control Initiatives
Commenting on plans to restrain future expense growth, Mr. Redman stated, "In an effort to control the growth in G&A expense, due primarily to the impact of higher FDIC deposit insurance expense, increased regulatory compliance expense, pension expense and the additional expenses associated with the resumption of multi-family lending, the Company has initiated several steps that will significantly slow the growth of G&A in 2012 and beyond. Specifically, the Company has instituted a salary freeze, including the exclusion of a corporate incentive bonus and equity compensation awards, for executive and senior officers. Further, the Company has commenced a corporate-wide review of all components of compensation, including retirement plans and staffing levels. These initiatives are expected to essentially keep core G&A expense (excluding any one-time charges associated with these initiatives) similar to the total G&A expense recorded in 2011, despite the higher costs stated above and the projected balance sheet growth."
Balance Sheet Summary
Total assets increased $45.4 million from September 30, 2011 and declined $1.1 billion from December 31, 2010 and totaled $17.0 billion at December 31, 2011. The year over year decrease is primarily due to a decrease in the loan portfolio. "We are pleased to report a slight increase in the balance sheet in the 2011 fourth quarter, primarily from the multi-family/CRE loan closings in December, the first balance sheet increase in more than two years. As previously stated, our expectation for more significant growth in 2012 is predicated on the growth of the multi-family/CRE loan portfolio more than offsetting any decline in the residential loan portfolio. At December 31, 2011, the residential loan pipeline was $1.1 billion and the multi-family/CRE loan pipeline was $396.5 million, and is continuing to grow due to the robust multi-family lending we are now experiencing," Mr. Redman noted.
The residential loan portfolio remained essentially unchanged from September 30, 2011 and totaled $10.6 billion at December 31, 2011 compared to $10.9 billion at December 31, 2010. For the quarter and year ended December 31, 2011, residential loan originations for portfolio totaled $1.1 billion and $3.5 billion, respectively, compared to $643.6 million, and $2.9 billion, respectively, for the comparable 2010 periods. The loan-to-value ratio of the residential loan production for portfolio for the 2011 fourth quarter and full year averaged approximately 60% at origination and the loan amount averaged approximately $765,000. Residential loan prepayments for the quarter and year ended December 31, 2011 totaled $996.0 million and $3.3 billion, respectively, compared to $1.0 billion and $3.4 billion, respectively, for the comparable 2010 periods.
The combined multi-family/CRE portfolio remained essentially unchanged from September 30, 2011 and totaled $2.3 billion at December 31, 2011 compared to $3.0 billion at December 31, 2010. For the quarter and year ended December 31, 2011, multi-family/CRE loan originations totaled $202.9 million and $204.0 million, respectively. There were no multi-family/CRE loans originated in 2010. Multi-family/CRE loan prepayments for the quarter and year ended December 31, 2011 totaled $182.3 million and $684.8 million, respectively, compared to $112.5 million and $299.0 million for the comparable 2010 periods.
The securities portfolio remained essentially unchanged from September 30, 2011 and totaled $2.5 billion at December 31, 2011 compared to $2.6 billion at December 31, 2010. We expect to maintain the securities portfolio at, or slightly higher than, current levels throughout 2012.
Deposits remained essentially unchanged from September 30, 2011 and totaled $11.2 billion at December 31, 2011 compared to $11.6 billion at December 31, 2010. Importantly, low-cost savings, money market and checking account deposits increased $291.8 million, or 21% annualized, from September 30, 2011 and $910.7 million, or 19%, from December 31, 2010 to $5.7 billion, or 51% of total deposits as compared to 42% at December 31, 2010. Certificate of deposit ("CD") accounts (including Liquid CDs) decreased $313.3 million from September 30, 2011 and $1.3 billion from December 31, 2010. Notwithstanding the decline in CDs, during the year ended December 31, 2011, we extended $635.4 million of CDs for terms of two years or more in an effort to help limit our exposure to future increases in interest rates. At December 31, 2011, our one-year interest rate sensitivity gap was positive 1.5%. Borrowings increased slightly from September 30, 2011 and decreased $747.6 million from December 31, 2010 to $4.1 billion at December 31, 2011.
On a linked quarter basis, stockholders' equity declined $33.3 million, primarily due to a $36.0 million other comprehensive loss adjustment to reflect a decrease in the funded status of our defined benefit pension plans at December 31, 2011 compared to December 31, 2010. For the full year, stockholders' equity increased $9.4 million to $1.3 billion, or 7.35% of total assets, at December 31, 2011. Astoria Federal continues to be designated as well-capitalized with leverage, tangible, risk-based and Tier 1 risk-based capital ratios of 8.70%, 8.70%, 16.08% and 14.80%, respectively, at December 31, 2011.
Asset Quality
Non-performing loans ("NPLs"), including troubled debt restructurings of $18.8 million, totaled $332.9 million, or 1.96% of total assets, at December 31, 2011, a decrease of $47.1 million from the previous quarter. During the 2011 fourth quarter, $36.5 million of NPLs were either sold or classified as held-for-sale. Residential NPLs totaled $317.9 million, multi-family/CRE/construction NPLs totaled $8.9 million and consumer and other NPLs totaled $6.1 million, compared to $324.9 million, $49.6 million and $5.5 million, respectively, at September 30, 2011. Of the $317.9 million of residential NPLs, $256.4 million, or 81%, represent residential loans which, at 180 days delinquent and annually thereafter, were reviewed and charged-off, as needed, to the estimated fair value of the underlying collateral at such time, less estimated selling costs.
The following table illustrates loan migration trends from 30 days delinquent to 90+ days delinquent:
30-59
Days 60-89 Days Combined Change from 90 + Days Total 30-90+
($ in millions) Past Due Past Due 30-89 Days Previous Past Due Days Past Due
-------- -------- Past Due Quarter (NPLs) -------------
-------- ------- ------
At Dec. 31, 2010 $165.8 $54.3 $220.1 $(31.9) $390.7 $610.8
At March 31, 2011 $155.0 $62.2 $217.2 $(2.9) $373.8 $591.0
At June 30, 2011 $162.8 $44.4 $207.2 $(10.0) $376.3 $583.5
At Sept. 30, 2011 $143.8 $44.7 $188.5 $(18.7) $380.0 $568.5
At Dec. 31, 2011 $166.7 $48.8 $215.5 $27.0 $332.9 $548.4
The table below details, as of December 31, 2011, the ten largest concentrations by state of one-to-four family loans and the respective non-performing loan totals in those states. More comprehensive state details are included in the "One-to-Four Family Residential Loan Portfolio-Geographic Analysis" table included in this release.
($ in Total % of NPLs
millions) Residential Total Total as %
of
State Loans Residential Residential State
Loan
----- ----- Portfolio NPLs Total
---- ----
New York $3,000.7 28.4% $42.6 1.42%
Illinois $1,246.1 11.8% $46.2 3.71%
Connecticut $1,099.3 10.4% $33.0 3.00%
Massachusetts $776.0 7.3% $10.7 1.38%
New Jersey $763.4 7.2% $54.7 7.17%
California $691.2 6.5% $33.8 4.89%
Virginia $634.8 6.0% $12.4 1.95%
Maryland $613.9 5.8% $40.4 6.58%
Washington $308.4 2.9% $3.4 1.10%
Texas $250.9 2.4% $0.0 0.0%
------ ----
Top 10
States $9,384.7 88.7% $277.2 2.95%
All other
states
(1,2) $1,176.8 11.3% $40.7 3.46%
-------- -----
Total
Residential
Portfolio $10,561.5 100% $317.9 3.01%
========= === ======
(1) Includes 26 states and Washington,
D.C.
(2) Includes Florida with $195.9 million
total loans, of which $22.6 million are
non-performing loans.
Net loan charge-offs for the quarter and year ended December 31, 2011 totaled $31.2 million and $81.3 million, respectively, compared to $19.7 million and $107.6 million, respectively, for the comparable 2010 periods. Included in the $31.2 million net loan charge-offs are $13.6 million of loan charge-offs related to loans transferred to held-for-sale and specific valuation allowances charged-off in accordance with OCC regulatory guidelines. Included in the 2011 fourth quarter residential net loan charge-offs are $10.8 million of charge-offs on $60.7 million of NPLs which, at 180 days delinquent and annually thereafter, were reviewed in the 2011 fourth quarter and charged-off, as needed, to the estimated fair value of the underlying collateral less estimated selling costs. "While we expect NPL levels will remain elevated for some time, especially in those states requiring judicial foreclosure, it is important to note that we believe the loss potential remaining has been greatly reduced as a result of our having already reviewed, marked down, and charged-off as necessary, 81% of the residential NPLs to their adjusted fair value less estimated selling costs," Mr. Redman noted.
Selected Asset Quality Metrics
(at or for the three months ended December 31, 2011, except as noted)
($ in millions) Residential Multi- CRE Construction Consumer Total
----------- family --- ------------ & Other -----
Loan portfolio
balance $10,561.5 $1,686.3 $659.7 $7.6 $282.4 (1) $13,274.6 (2)
Non-performing
loans $317.9 (3) $8.0 $0.9 $0.0 $6.1 $332.9
NPLs/total loans 2.39% 0.06% 0.01% N/A 0.05% 2.51%
Net charge-offs
4Q11 $12.2 $13.4 $3.4 $1.6 $0.6 $31.2
Net charge-offs
2011 $54.0 $20.1 $4.1 $1.6 $1.5 $81.3
(1) Includes home equity loans of $259.0 million.
(2) Includes $77.0 million of net unamortized
premiums and deferred loan costs.
(3) Includes $256.4 million, or 81%, of NPLs
reviewed and charged-off, as needed, at 180 days
delinquent and annually thereafter.
Future Outlook
Commenting on the outlook for 2012, Mr. Redman stated, "We continue to face several headwinds as we enter 2012. Economic growth remains weak, unemployment remains stubbornly elevated and home values continue to remain soft. In addition, the implementation of "Operation Twist" by the Federal Reserve has contributed to a flattening of the U.S. Treasury yield curve, putting further downward pressure on long term interest rates and current mortgage product offerings, as well as keeping mortgage loan prepayments at elevated levels. However, we are optimistic that the increase in the multi-family/CRE loan pipeline should facilitate modest loan and balance sheet growth in the first quarter and more robust growth as the year progresses. For 2012, we expect multi-family/CRE loan originations of approximately $1.5 billion and residential loan originations for portfolio of approximately $3.5 billion, assuming market conditions remain stable throughout 2012. With respect to the net interest margin, we expect core deposits will continue to increase in 2012 and that, in the current low interest rate environment, residential loan prepayment activity will remain elevated. Accordingly, we anticipate the margin for 2012 will be relatively similar to the margin for the 2011 fourth quarter."
Earnings Conference Call January 26, 2012 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 26, 2012 at 10:00 a.m. (ET). The toll-free dial-in number is (877) 709-8150. A telephone replay will be available on January 26, 2012 from 1:00 p.m. (ET) through midnight February 4, 2012 (ET). The toll-free replay number is (877) 660-6853, account # 399, ID# 386402. 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 $17.0 billion, is the holding company for Astoria Federal Savings and Loan Association. Established in 1888, Astoria Federal, with deposits in New York totaling $11.2 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 mortgage loans through its banking and loan production offices in New York, an extensive broker network covering fourteen states, primarily along the East Coast, and the District of Columbia, and through correspondent relationships covering fifteen 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," "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, 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.
ASTORIA FINANCIAL CORPORATION AND
SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL
CONDITION
------------------------------------
(In Thousands, Except Share Data)
At At
December December
31, 31,
2011 2010
---- ----
ASSETS
------
Cash and due from banks $132,704 $67,476
Repurchase agreements - 51,540
Securities available-for-sale 344,187 561,953
Securities held-to-maturity
(fair value of $2,176,925 and $2,042,110,
respectively) 2,130,804 2,003,784
Federal Home Loan Bank of New York stock, at
cost 131,667 149,174
Loans held-for-sale, net 32,394 44,870
Loans receivable:
Mortgage loans, net 12,990,600 13,911,200
Consumer and other loans, net 284,004 311,847
------- -------
13,274,604 14,223,047
Allowance for loan losses (157,185) (201,499)
-------- --------
Total loans receivable, net 13,117,419 14,021,548
Mortgage servicing rights, net 8,136 9,204
Accrued interest receivable 46,528 55,492
Premises and equipment, net 119,946 133,362
Goodwill 185,151 185,151
Bank owned life insurance 409,637 410,418
Real estate owned, net 48,059 63,782
Other assets 315,423 331,515
------- -------
TOTAL ASSETS $17,022,055 $18,089,269
=========== ===========
LIABILITIES
-----------
Deposits $11,245,614 $11,599,000
Reverse repurchase agreements 1,700,000 2,100,000
Federal Home Loan Bank of New York advances 2,043,000 2,391,000
Other borrowings, net 378,573 378,204
Mortgage escrow funds 110,841 109,374
Accrued expenses and other liabilities 292,829 269,911
TOTAL LIABILITIES 15,770,857 16,847,489
---------- ----------
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 98,537,715 and
97,877,469 shares
outstanding, respectively) 1,665 1,665
Additional paid-in capital 875,395 864,744
Retained earnings 1,861,592 1,848,095
Treasury stock (67,957,173 and 68,617,419
shares, at cost, respectively) (1,404,311) (1,417,956)
Accumulated other comprehensive loss (75,661) (42,161)
Unallocated common stock held by ESOP
(2,042,367 and 3,441,130 shares,
respectively) (7,482) (12,607)
TOTAL STOCKHOLDERS' EQUITY 1,251,198 1,241,780
--------- ---------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $17,022,055 $18,089,269
=========== ===========
ASTORIA FINANCIAL
CORPORATION AND
SUBSIDIARIES
CONSOLIDATED
STATEMENTS OF
INCOME
--------------
(In Thousands,
Except Share
Data)
For the Three For the Twelve
Months Ended Months Ended
December 31, December 31,
------------ ------------
2011 2010 2011 2010
---- ---- ---- ----
Interest income:
One-to-four
family mortgage
loans $101,637 $120,679 $433,951 $529,319
Multi-family,
commercial real
estate and
construction
mortgage loans 37,518 47,372 162,433 196,541
Consumer and other
loans 2,412 2,597 9,889 10,572
Mortgage-backed
and other
securities 18,623 22,887 82,055 109,206
Repurchase
agreements and
interest-earning
cash accounts 16 133 237 390
Federal Home Loan
Bank of New York
stock 1,297 2,855 6,683 9,271
----- ----- ----- -----
Total interest
income 161,503 196,523 695,248 855,299
Interest expense:
Deposits 31,893 41,833 138,049 191,015
Borrowings 42,079 53,449 181,773 230,717
------ ------ ------- -------
Total interest
expense 73,972 95,282 319,822 421,732
------ ------ ------- -------
Net interest
income 87,531 101,241 375,426 433,567
Provision for loan
losses 10,000 15,000 37,000 115,000
Net interest
income after
provision for
loan losses 77,531 86,241 338,426 318,567
Non-interest
income:
Customer service
fees 10,439 12,101 46,135 51,229
Other loan fees 786 906 3,160 3,452
Mortgage banking
income, net 1,570 3,434 4,413 6,222
Income from bank
owned life
insurance 2,655 1,948 10,257 8,683
Other 1,840 2,323 4,950 11,602
----- ----- ----- ------
Total non-
interest income 17,290 20,712 68,915 81,188
Non-interest
expense:
General and
administrative:
Compensation and
benefits 37,952 35,655 151,149 141,539
Occupancy,
equipment and
systems 16,515 15,906 65,182 65,498
Federal deposit
insurance
premiums 10,554 6,006 38,083 25,728
Advertising 1,486 1,909 7,842 6,466
Other 10,741 10,451 39,161 45,687
------ ------ ------ ------
Total non-
interest expense 77,248 69,927 301,417 284,918
------ ------ ------- -------
Income before
income tax
expense 17,573 37,026 105,924 114,837
Income tax expense 5,809 13,215 38,715 41,103
----- ------ ------ ------
Net income $11,764 $23,811 $67,209 $73,734
======= ======= ======= =======
Basic earnings per
common share $0.12 $0.25 $0.70 $0.78
===== ===== ===== =====
Diluted earnings
per common share $0.12 $0.25 $0.70 $0.78
===== ===== ===== =====
Basic weighted
average common
shares 93,979,192 92,153,490 93,253,928 91,776,907
Diluted weighted
average common
and common
equivalent shares 93,979,192 92,153,490 93,253,928 91,776,941
ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES
AVERAGE BALANCE SHEETS
----------------------
(Dollars in Thousands)
For the Three Months Ended December 31,
---------------------------------------
2011 2010
Average Average
Average Yield/ Average Yield/
Balance Interest Cost Balance Interest Cost
(Annualized) (Annualized)
Assets:
Interest-earning assets:
Mortgage loans (1):
One-to-four family $10,647,279 $101,637 3.82% $11,214,431 $120,679 4.30%
Multi-family, commercial real
estate and construction 2,355,391 37,518 6.37 3,079,728 47,372 6.15
Consumer and other loans (1) 288,171 2,412 3.35 317,612 2,597 3.27
------- ----- ------- -----
Total loans 13,290,841 141,567 4.26 14,611,771 170,648 4.67
Mortgage-backed and other securities
(2) 2,415,348 18,623 3.08 2,470,933 22,887 3.70
Repurchase agreements and
interest-earning cash accounts 54,464 16 0.12 245,709 133 0.22
Federal Home Loan Bank stock 127,078 1,297 4.08 158,462 2,855 7.21
------- ----- ------- -----
Total interest-earning assets 15,887,731 161,503 4.07 17,486,875 196,523 4.50
Goodwill 185,151 185,151
Other non-interest-earning assets 956,675 973,942
Total assets $17,029,557 $18,645,968
Liabilities and stockholders' equity:
Interest-bearing liabilities:
Savings $2,737,029 1,750 0.26 $2,561,779 2,605 0.41
Money market 1,031,489 2,181 0.85 366,292 416 0.45
NOW and demand deposit 1,830,974 303 0.07 1,715,423 285 0.07
Liquid certificates of deposit 281,083 88 0.13 503,905 356 0.28
------- --- ------- ---
Total core deposits 5,880,575 4,322 0.29 5,147,399 3,662 0.28
Certificates of deposit 5,394,545 27,571 2.04 6,680,904 38,171 2.29
--------- ------ --------- ------
Total deposits 11,275,120 31,893 1.13 11,828,303 41,833 1.41
Borrowings 4,024,787 42,079 4.18 5,088,098 53,449 4.20
--------- ------ --------- ------
Total interest-bearing liabilities 15,299,907 73,972 1.93 16,916,401 95,282 2.25
Non-interest-bearing liabilities 456,406 487,265
Total liabilities 15,756,313 17,403,666
Stockholders' equity 1,273,244 1,242,302
--------- ---------
Total liabilities and stockholders' equity $17,029,557 $18,645,968
Net interest income/net interest
rate spread (3) $87,531 2.14% $101,241 2.25%
Net interest-earning assets/net
interest margin (4) $587,824 2.20% $570,474 2.32%
Ratio of interest-earning assets
to interest-bearing liabilities 1.04x 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.
(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,
----------------------------------------
2011 2010
Average Average
Average Yield/ Average Yield/
Balance Interest Cost Balance Interest Cost
Assets:
Interest-earning assets:
Mortgage loans (1):
One-to-four family $10,687,593 $433,951 4.06% $11,694,736 $529,319 4.53%
Multi-family, commercial real
estate and construction 2,608,792 162,433 6.23 3,258,928 196,541 6.03
Consumer and other loans (1) 297,394 9,889 3.33 325,579 10,572 3.25
------- ----- ------- ------
Total loans 13,593,779 606,273 4.46 15,279,243 736,432 4.82
Mortgage-backed and other securities
(2) 2,435,028 82,055 3.37 2,790,097 109,206 3.91
Repurchase agreements and
interest-earning cash accounts 128,396 237 0.18 197,584 390 0.20
Federal Home Loan Bank stock 132,666 6,683 5.04 172,511 9,271 5.37
------- ----- ------- -----
Total interest-earning assets 16,289,869 695,248 4.27 18,439,435 855,299 4.64
Goodwill 185,151 185,151
Other non-interest-earning assets 919,617 902,804
Total assets $17,394,637 $19,527,390
Liabilities and stockholders' equity:
Interest-bearing liabilities:
Savings $2,762,155 9,562 0.35 $2,384,477 9,628 0.40
Money market 616,048 4,551 0.74 343,996 1,533 0.45
NOW and demand deposit 1,798,719 1,175 0.07 1,675,680 1,092 0.07
Liquid certificates of deposit 358,253 787 0.22 595,693 2,637 0.44
------- --- ------- -----
Total core deposits 5,535,175 16,075 0.29 4,999,846 14,890 0.30
Certificates of deposit 5,797,895 121,974 2.10 7,298,999 176,125 2.41
--------- ------- --------- -------
Total deposits 11,333,070 138,049 1.22 12,298,845 191,015 1.55
Borrowings 4,368,659 181,773 4.16 5,568,740 230,717 4.14
--------- ------- --------- -------
Total interest-bearing liabilities 15,701,729 319,822 2.04 17,867,585 421,732 2.36
Non-interest-bearing liabilities 427,225 434,347
Total liabilities 16,128,954 18,301,932
Stockholders' equity 1,265,683 1,225,458
--------- ---------
Total liabilities and stockholders' equity $17,394,637 $19,527,390
Net interest income/net interest
rate spread (3) $375,426 2.23% $433,567 2.28%
Net interest-earning assets/net
interest margin (4) $588,140 2.30% $571,850 2.35%
Ratio of interest-earning assets
to interest-bearing liabilities 1.04x 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.
(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,
------------ ------------
2011 2010 2011 2010
---- ---- ---- ----
(Annualized)
Selected Returns and Financial
Ratios
------------------------------
Return on average
stockholders' equity 3.70% 7.67% 5.31% 6.02%
Return on average tangible
stockholders' equity (1) 4.32 9.01 6.22 7.09
Return on average assets 0.28 0.51 0.39 0.38
General and administrative
expense to average assets 1.81 1.50 1.73 1.46
Efficiency ratio (2) 73.70 57.34 67.83 55.35
Net interest rate spread 2.14 2.25 2.23 2.28
Net interest margin 2.20 2.32 2.30 2.35
Selected Non-GAAP Returns and
Financial Ratios (3)
-----------------------------
Non-GAAP return on average
stockholders' equity 5.31% 6.19%
Non-GAAP return on average
tangible stockholders' equity
(1) 6.22 7.29
Non-GAAP return on average
assets 0.39 0.39
Non-GAAP general and
administrative expense to
average assets 1.73 1.42
Non-GAAP efficiency ratio (2) 67.83 54.31
Asset Quality Data (dollars in
thousands)
------------------------------
Non-performing assets (4) $380,916 $454,492
Non-performing loans (4) 332,857 390,710
Loans delinquent 90 days or
more and still accruing
interest 162 845
Non-accrual loans 332,695 389,865
Loans 60-89 days delinquent 48,815 54,339
Loans 30-59 days delinquent 166,740 165,810
Net charge-offs $31,166 $19,732 81,314 107,550
Non-performing loans/total
loans 2.51% 2.75%
Non-performing loans/total
assets 1.96 2.16
Non-performing assets/total
assets 2.24 2.51
Allowance for loan losses/
non-performing loans 47.22 51.57
Allowance for loan losses/
non-accrual loans 47.25 51.68
Allowance for loan losses/
total loans 1.18 1.42
Net charge-offs to average
loans outstanding 0.94% 0.54% 0.60 0.70
Capital Ratios (Astoria
Federal)
-----------------------
Tangible 8.70% 7.94%
Leverage 8.70 7.94
Risk-based 16.08 14.60
Tier 1 risk-based 14.80 13.33
Other Data
----------
Cash dividends paid per common
share $0.13 $0.13 $0.52 $0.52
Book value per share (5) 12.97 13.15
Tangible book value per share
(6) 11.05 11.19
Tangible common stockholders'
equity/tangible assets (1)
(7) 6.33% 5.90%
Mortgage loans serviced for
others (in thousands) $1,446,646 $1,443,709
Full time equivalent employees 1,636 1,565
(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) See the "Reconciliation of GAAP Measures to Non-GAAP Measures" table
included in this release for a reconciliation of GAAP measures to non-GAAP
measures for the twelve months ended December 31, 2010.
(4) Non-performing assets and non-performing loans include, but are not limited
to, one-to-four family 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.
(5) Book value per share represents stockholders' equity divided by outstanding
shares, excluding unallocated Employee Stock Ownership Plan, or ESOP, shares.
(6) Tangible book value per share represents stockholders' equity less goodwill
divided by outstanding shares, excluding unallocated ESOP shares.
(7) Tangible assets represent assets less goodwill.
ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES
END OF PERIOD BALANCES AND
RATES
--------------------------
(Dollars in Thousands)
At December At September At December
31, 2011 30, 2011 31, 2010
------------- ------------- -------------
Weighted Weighted Weighted
Average Average Average
Rate Rate Rate
Balance (1) Balance (1) Balance (1)
------- ----- ------- ----- ------- -----
Selected interest-earning
assets:
Mortgage loans, gross (2):
One-to-four family $10,243,672 4.16% $10,237,483 4.34% $10,512,746 4.73%
Multi-family, commercial
real estate
and construction 2,344,655 5.88 2,341,280 6.05 2,931,847 6.03
Mortgage-backed and other
securities (3) 2,474,991 3.57 2,477,052 3.65 2,565,737 3.83
Interest-bearing
liabilities:
Savings 2,750,715 0.25 2,760,922 0.25 2,664,859 0.40
Money market 1,114,404 0.71 864,253 0.94 376,302 0.45
NOW and demand deposit 1,861,488 0.06 1,809,662 0.06 1,774,790 0.06
Liquid certificates of
deposit 263,809 0.10 301,221 0.19 468,730 0.25
------- ------- -------
Total core deposits 5,990,416 0.27 5,736,058 0.29 5,284,681 0.28
Certificates of deposit 5,255,198 2.03 5,531,089 2.05 6,314,319 2.20
--------- --------- ---------
Total deposits 11,245,614 1.09 11,267,147 1.15 11,599,000 1.33
Borrowings, net 4,121,573 3.98 4,022,481 4.14 4,869,204 4.14
(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.
ASTORIA
FINANCIAL
CORPORATION
AND
SUBSIDIARIES
RECONCILIATION
OF GAAP
MEASURES TO
NON-GAAP
MEASURES
--------------
(In Thousands,
Except Per
Share Data)
Income and expense and related financial ratios
determined in accordance with GAAP (GAAP measures)
excluding the adjustments detailed in the
following table (non-GAAP measures) provide a
meaningful comparison for effectively evaluating
Astoria's operating results.
For the Twelve Months Ended
December 31, 2010
-----------------
Non-
GAAP Adjustments (1) GAAP
---- --------------- -----
Net interest
income $433,567 $- $433,567
Provision for
loan losses 115,000 - 115,000
------- --- -------
Net interest
income after
provision for
loan losses 318,567 - 318,567
Non-interest
income 81,188 (4,635) 76,553
Non-interest
expense
(general and
administrative
expense) 284,918 (7,850) 277,068
------- ------ -------
Income before
income tax
expense 114,837 3,215 118,052
Income tax
expense 41,103 1,133 42,236
------ ----- ------
Net income $73,734 $2,082 $75,816
------- ------ -------
Basic earnings
per common
share $0.78 $0.02 $0.81 (2)
----- ----- ----- ---
Diluted
earnings per
common share $0.78 $0.02 $0.81 (2)
----- ----- ----- ---
Non-GAAP returns are calculated substituting non-
GAAP net income for net income in the
corresponding ratio calculation, while the non-
GAAP general and administrative expense to average
assets ratio substitutes non-GAAP general and
administrative expense (non-GAAP non-interest
expense) for general and administrative expense
(non-interest expense) in the corresponding ratio
calculation. Similarly, the non-GAAP efficiency
ratio substitutes non-GAAP non-interest income
and non-GAAP general and administrative expense
for non-interest income and general and
administrative expense in the corresponding ratio
calculation.
(1) Non-interest income adjustment relates to
the $6.2 million goodwill litigation settlement,
partially offset by the $1.5 million impairment
write-down of premises and equipment, recorded in
the 2010 second quarter. Non-interest expense
adjustment relates to the McAnaney litigation
settlement recorded in the 2010 second quarter.
(2) Figures do not cross foot due to rounding.
ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES
One-to-Four Family Residential Loan Portfolio - Geographic
Analysis
----------------------------------------------------------
(Dollars in
millions)
At December 31, 2011
--------------------
Non-performing
loans
Total Non-performing as % of total
State loans loans loans
----- ------ --------------- --------------
New York
Full Income $2,736.1 $20.0 0.73%
Alt A < 70% LTV $205.7 $12.4 6.03%
Alt A 70%-80%
LTV $58.9 $10.2 17.32%
----- -----
State Total $3,000.7 $42.6 1.42%
Illinois
Full Income $1,037.7 $18.4 1.77%
Alt A < 70% LTV $107.7 $11.7 10.86%
Alt A 70%-80%
LTV $100.7 $16.1 15.99%
------ -----
State Total $1,246.1 $46.2 3.71%
Connecticut
Full Income $952.4 $14.0 1.47%
Alt A < 70% LTV $102.2 $12.1 11.84%
Alt A 70%-80%
LTV $44.7 $6.9 15.44%
----- ----
State Total $1,099.3 $33.0 3.00%
Massachusetts
Full Income $690.1 $6.4 0.93%
Alt A < 70% LTV $61.8 $2.8 4.53%
Alt A 70%-80%
LTV $24.1 $1.5 6.22%
----- ----
State Total $776.0 $10.7 1.38%
New Jersey
Full Income $606.7 $26.3 4.33%
Alt A < 70% LTV $78.4 $9.1 11.61%
Alt A 70%-80%
LTV $78.3 $19.3 24.65%
----- -----
State Total $763.4 $54.7 7.17%
California
Full Income $443.3 $15.4 3.47%
Alt A < 70% LTV $130.4 $8.3 6.37%
Alt A 70%-80%
LTV $117.5 $10.1 8.60%
------ -----
State Total $691.2 $33.8 4.89%
Virginia
Full Income $493.1 $5.3 1.07%
Alt A < 70% LTV $63.9 $2.5 3.91%
Alt A 70%-80%
LTV $77.8 $4.6 5.91%
----- ----
State Total $634.8 $12.4 1.95%
Maryland
Full Income $477.6 $18.8 3.94%
Alt A < 70% LTV $65.4 $6.4 9.79%
Alt A 70%-80%
LTV $70.9 $15.2 21.44%
----- -----
State Total $613.9 $40.4 6.58%
Washington
Full Income $303.3 $3.0 0.99%
Alt A < 70% LTV $3.4 $0.0 0.00%
Alt A 70%-80%
LTV $1.7 $0.4 23.53%
---- ----
State Total $308.4 $3.4 1.10%
Texas
Full Income $250.8 $0.0 0.00%
Alt A < 70% LTV $0.1 $0.0 0.00%
Alt A 70%-80%
LTV $0.0 $0.0 0.00%
---- ----
State Total $250.9 $0.0 0.00%
Other States*
Full Income $1,012.8 $23.9 2.36%
Alt A < 70% LTV $99.6 $8.9 8.94%
Alt A 70%-80%
LTV $64.4 $7.9 12.27%
----- ----
Other States
Total $1,176.8 $40.7 3.46%
Total all states
Full Income $9,003.9 $151.5 1.68%
Alt A < 70% LTV $918.6 $74.2 8.08%
Alt A 70%-80%
LTV $639.0 $92.2 14.43%
------ -----
Grand total $10,561.5 $317.9 3.01%
========= ======
* Includes Florida with $195.9 million total loans, of which
$22.6 million are non
Note: LTVs are based on current principal balances and original
appraised values.
SOURCE Astoria Financial Corporation
