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ASTORIA FEDERAL SAVINGS AND LOAN ASSOCIATION REPORTS THIRD QUARTER AND NINE-MONTH RESULTS

 LAKE SUCCESS, N.Y., Nov. 16 /PRNewswire/ -- Astoria Financial Corporation (NASDAQ: ASFC), the newly formed holding company for Astoria Federal Savings and Loan Association, today reported financial results for Astoria Federal's 1993 third quarter and nine months ended September 30, 1993.
 Astoria Financial Corporation was formed for the purpose of acquiring all of the common stock of Astoria Federal concurrent with its conversion from a mutual to a stock form of organization. A registration statement related to the conversion and the initial public offering of Astoria Financial Corporation was filed with the Securities and Exchange Commission on August 5, 1993 and, as amended, was declared effective on October 1, 1993.
 George L. Engelke, Jr., President and Chief Executive Officer of both Astoria Financial Corporation and Astoria Federal Savings and Loan Association, commented, "The depositors of Astoria Federal voted to approve the conversion from a mutual to a stock charter on November 10, 1993. We expect to complete the conversion shortly, after which trading in Astoria Financial Corporation stock will commence on NASDAQ."
 Astoria Federal reported net income increased 144 percent to $8.8 million for the 1993 third quarter, compared to $3.6 million in the year-ago quarter. The increase in net income was primarily attributable to increases in both net interest income and non-interest income and a significant decrease in non-interest expense.
 For the nine months ended September 30, 1993, Astoria Federal reported $14.7 million in net income, compared to $12.4 million for the comparable period of 1992. Nine-month results for 1993 reflect several generally non-recurring items including an $8.3 million restructuring provision related to the decision to outsource all major data processing operations, a penalty on prepayment of FHLB-NY advances of $3.5 million, net of taxes, and an offsetting $2.9 million net benefit resulting from the cumulative effect of accounting changes.
 Net interest income after provision for losses on loans and investments rose 12 percent to $30.5 million for the third quarter of 1993, compared to $27.4 million for the 1992 third quarter. Astoria Federal's net interest spread was 3.36 percent for the quarter ended September 30, 1993, compared to 3.60 percent for the September 1992 quarter. The reduction primarily reflects increased prepayments on the mortgage-backed and mortgage-related securities portfolio including the acceleration of premium amortization on certain of those securities. Astoria Federal's net interest spread at September 30, 1993 was 3.58 percent.
 For the nine months ended September 30, 1993, net interest income after provision for losses on loans and investments totaled $86.5 million, an increase of 13 percent compared to $76.5 million for the comparable period of 1992. The 1993 nine-month net interest spread was 3.47 percent, compared to 3.28 percent for the 1992 period.
 Non-interest income totaled $1.7 million in the third quarter, an increase of 23 percent from the $1.4 million recorded in the 1992 third quarter. For the nine months ended September 30, 1993 non-interest income increased 12 percent to $4.7 million, up from $4.2 million in the year-ago period. The growth in non-interest income in both the three- and nine-month periods ended September 30, 1993 primarily reflected increases in customer-related fees.
 For the three months ended September 30, 1993, non-interest expense totaled $16.4 million, a decline of 15 percent from $19.2 million in the year-ago quarter. Driving the decrease in non-interest expense in the quarter was a reduction in expenses related to Astoria Federal's real estate operations and a relatively stable level of general and administrative expenses. Non-interest expense equaled $62.7 million for the nine months ended September 30, 1993 compared to $54.0 million in the 1992 period. The increase primarily reflected the $8.3 million restructuring provision previously noted.
 Non-performing assets totaled $133.4 million at September 30, 1993, or 3.5 percent of total assets as compared to 3.8 percent of total assets at June 30, 1993 and 4.6 percent at December 31, 1992. The provision for losses on loans and investments for the third quarter of 1993 totaled $612,000 compared to $1.9 million for the quarter ended September 30, 1992.
 For the nine-month period of 1993 the provision for losses on loans and investments equaled $6.2 million compared to $3.6 million in the year-ago period. The increase in the provision reflected management's conservative assessment of its commercial and multi- family real estate portfolio in conjunction with an analysis of metropolitan New York real estate market conditions.
 At September 30, 1993, Astoria Federal's capital levels were in excess of all regulatory requirements. Tangible and core ratios were 6.58 percent and 6.70 percent, respectively, exceeding the requirements of 1.50 percent and 3.00 percent, respectively. The risk-based capital ratio of 18.24 percent is well in excess of the required 8.00 percent.
 Astoria Federal Savings & Loan Association, with $3.8 billion in assets, is one of the largest thrifts in the state of New York. Astoria Federal, which specializes in single-family residential mortgage lending, operates 28 banking offices, located in the New York City metropolitan areas of Queens, Nassau, Suffolk and Westchester counties, and the upstate New York counties of Chenango and Otsego.
 ASTORIA FEDERAL SAVINGS AND LOAN ASSOCIATION
 AND SUBSIDIARIES
 Unaudited
 CONSOLIDATED STATEMENTS OF INCOME
 (In thousands)
 Three Months Ended Nine Months Ended
 9/30/93 9/30/92 9/30/93 9/30/92
 Interest income:
 Loans receivable $ 35,282 $ 41,331 $109,772 $128,304
 Mortgage-backed and mortgage-
 related-securities 22,776 18,052 67,853 50,957
 Federal funds sold and
 repurchase agreements 2,565 1,512 6,078 6,280
 Investment securities 4,721 5,442 14,946 14,638
 Total interest income 65,344 66,337 198,649 200,179
 Interest expense:
 Deposits 28,660 33,237 89,637 107,850
 Borrowed funds 5,585 3,801 16,302 12,256
 Total interest expense 34,245 37,038 105,939 120,106
 Net interest income before pro-
 vision for losses on loans and
 investments 31,099 29,299 92,710 80,073
 Provision for losses on loans
 and investments 612 1,947 6,167 3,578
 Net interest income after pro-
 vision for losses on loans and
 investments 30,487 27,352 86,543 76,495
 Non-interest income:
 Loan fees 357 374 1,184 1,219
 Customer service charges 802 549 2,082 1,388
 Other 575 485 1,466 1,631
 Total non-interest income 1,734 1,408 4,732 4,238
 Non-interest expense:
 General and
 administrative 14,833 15,059 45,981 43,901
 Real estate
 operations, net 1,031 3,880 6,751 8,341
 Amortization of
 intangibles 563 295 1,688 1,743
 Provision for
 restructuring --- --- 8,325 ---
 Total non-interest expense 16,427 19,234 62,745 53,985
 Income before income taxes,
 extraordinary item and cumu-
 lative effect of accounting
 changes 15,794 9,526 28,530 26,748
 Income tax expense 6,950 5,919 13,218 14,340
 Extraordinary item (a) --- --- (3,499) ---
 Cumulative effect of account-
 ing changes (b) --- --- 2,881 ---
 NET INCOME $ 8,844 $ 3,607 $ 14,694 $ 12,408


(a) Penalty on prepayment of FHLB-NY advances net of income tax benefit of $3,305,000. (b) Net effect of changes required by SFAS 109, "Accounting for Income
 Taxes," and SFAS 106, "Employers' Accounting for Post-retirement
 Benefits Other Than Pensions."
 ASTORIA FEDERAL SAVINGS AND LOAN ASSOCIATION
 AND SUBSIDIARIES
 Unaudited
 CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
 (In thousands)
 September December
 1993 1992
 ASSETS
 Cash and due from banks $ 4,166 $ 19,217
 Federal funds sold 282,000 150,000
 Investment securities 313,739 304,501
 Mortgage-backed and mortgage-
 related securities 1,498,700 1,124,551
 Loans receivable:
 First mortgage loans 1,466,634 1,575,430
 Consumer and commercial loans 63,676 70,708
 Total 1,530,310 1,646,138
 Less allowance for loan losses 11,004 8,697
 Loans receivable, net 1,519,306 1,637,441
 Real estate owned, net 61,223 76,760
 Investments in real estate, net 10,795 15,166
 Accrued interest receivable, net 15,902 15,256
 Premises and equipment, net 56,771 61,936
 Core deposit and other intangibles 7,287 8,975
 Other assets 5,980 6,035
 TOTAL ASSETS $3,775,869 $3,419,838
 LIABILITIES AND RETAINED EARNINGS
 Liabilities:
 Deposits $2,927,595 $2,877,843
 Borrowed funds 552,849 265,500
 Mortgage escrow funds 15,074 13,987
 Accrued expenses and other
 liabilities 23,438 20,289
 TOTAL LIABILITIES 3,518,956 3,177,619
 Retained earnings 256,913 242,219
 TOTAL LIABILITIES AND RETAINED
 EARNINGS $3,775,869 $3,419,838
 ASTORIA FEDERAL SAVINGS AND LOAN ASSOCIATION
 AND SUBSIDIARIES
 Unaudited
 SELECTED FINANCIAL RATIOS AND OTHER DATA
 At or For the At or For the
 Three Months Ended Nine Months Ended
 9/30/93 9/30/92 9/30/93 9/30/92
 Performance Ratios (annualized)
 Return on average assets 0.96 pct 0.43 pct 0.55 pct 0.50 pct
 Return on average retained
 earnings 14.02 6.14 7.85 7.18
 Net interest spread 3.36 3.60 3.47 3.28
 Net interest margin 3.52 3.73 3.61 3.43
 General and administrative
 expenses to average assets 1.61 1.80 1.71 1.77
 Total non-interest expense to
 average assets 1.78 2.31 2.33 2.18
 Capital Ratios
 Tangible 6.58 pct 6.51 pct
 Core 6.70 6.84
 Risk-based 18.24 15.07
 Other Data
 Average retained earnings/average
 assets 6.83 pct 7.04 pct 6.95 pct 6.97 pct


Average interest-earning
 assets (in millions) $3,537 $3,145 $3,421 $3,112


Average interest-bearing
 liabilities (in millions) $3,399 $3,059 $3,297 $3,030


Non-performing
 loans (in millions) $61 $58
 Non-performing assets (in millions) $133 $160
 At At
 9/30/93 12/31/92
 Asset Quality Ratios
 Non-performing loans/total loans 3.98 pct 3.94 pct
 Non-performing assets/total assets 3.53 4.60


Allowance for loan losses/non-
 performing loans 17.94 13.33
 -0- 11/16/93
 /CONTACT: Mary Crane, Assistant Vice President-Investor Relations of Astoria Federal, 516-327-3000, Michele Katz or Jeff Majtyka of Morgen-Walke Associates, 212-850-5600/
 (ASFC)


CO: Astoria Federal Savings and Loan Association ST: New York IN: FIN SU: ERN

LG -- NY013 -- 4890 11/16/93 08:35 EST
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