Astoria Financial Corporation Announces First Quarter EPS Of $0.32

LAKE SUCCESS, N.Y., April 16 /PRNewswire-FirstCall/ -- Astoria Financial Corporation ("Astoria", the "Company"), the holding company for Astoria Federal Savings and Loan Association ("Astoria Federal"), today reported net income of $28.9 million, or $0.32 diluted earnings per share ("EPS"), for the quarter ended March 31, 2008, compared to $35.8 million, or $0.38 EPS, for the 2007 first quarter.

Commenting on the first quarter results, George L. Engelke, Jr., Chairman and Chief Executive Officer of Astoria, noted, "While the operating environment has improved during the first quarter, our results were tempered by accelerated loan premium amortization due to significantly elevated residential mortgage loan prepayments, which negatively impacted earnings per share by $0.04 and the net interest margin by ten basis points versus the trailing quarter results. We also experienced a modest decline in the loan portfolio and balance sheet. We expect loan growth will resume in the second quarter due to the 95% increase in the mortgage loan pipeline during the first quarter to $2.2 billion at March 31, 2008."

Board Declares Quarterly Cash Dividend of $0.26 Per Share

The Board of Directors of the Company, at their April 16, 2008 meeting, declared a quarterly cash dividend of $0.26 per common share. The dividend is payable on June 2, 2008 to shareholders of record as of May 15, 2008. This is the fifty-second consecutive quarterly cash dividend declared by the Company.

Twelfth Stock Repurchase Program Continues

During the 2008 first quarter, Astoria repurchased 290,000 shares of its common stock at an average cost of $25.55 per share. Under the current stock repurchase program, 8.6 million shares remain available for repurchase as of March 31, 2008.

First Quarter 2008 Earnings Summary

Net interest income for the quarter ended March 31, 2008 totaled $80.8 million compared to $81.9 million for the 2007 fourth quarter and $87.5 million for the 2007 first quarter.

Astoria's net interest margin for the quarter ended March 31, 2008 was 1.57%, unchanged from the 2007 fourth quarter and down from 1.71% for the 2007 first quarter. As previously mentioned, the 2008 first quarter margin was negatively impacted by the increase in loan premium amortization as a result of accelerated loan prepayments. "We expect that the net interest margin will expand in the second quarter, as we increasingly realize the repricing benefit of deposit and borrowing liabilities with rates that are considerably above current market rates. CDs and Liquid CDs totaling $7.6 billion, with a weighted average rate of 4.32%, and borrowings totaling $2.2 billion, with a weighted average rate of 4.91%, are scheduled to mature over the next twelve months," Mr. Engelke noted.

For the quarter ended March 31, 2008, a $4.0 million provision for loan losses was recorded compared to $2.0 million for the previous quarter and no provision for the 2007 first quarter. Non-interest income for the quarter ended March 31, 2008 totaled $22.4 million compared to $22.6 million for the 2007 first quarter.

General and administrative expense for the quarter ended March 31, 2008 totaled $58.2 million compared to $58.9 million for the 2007 fourth quarter and $57.1 million for the 2007 first quarter.

Balance Sheet Summary

In the 2008 first quarter, the loan portfolio decreased $453.5 million from the previous quarter end to $15.7 billion at March 31, 2008. Total loan production for the 2008 first quarter was $740.8 million compared to $896.0 million for the comparable 2007 period and $882.1 million for the 2007 fourth quarter. The loan pipeline at March 31, 2008 totaled $2.2 billion, an increase of $1.1 billion from December 31, 2007.

The one-to-four family mortgage loan portfolio decreased $352.7 million in the 2008 first quarter from the previous quarter end to $11.3 billion at March 31, 2008. One-to-four family loan originations and purchases totaled $673.5 million for the 2008 first quarter compared to $760.0 million for the 2007 first quarter and $816.1 million for the 2007 fourth quarter. One-to-four family loan prepayments for the quarter ended March 31, 2008 totaled $892.6 million compared to $475.0 million for the 2007 first quarter and $427.7 million for the 2007 fourth quarter.

The loan-to-value ratio of the first quarter 2008 one-to-four family loan production for portfolio averaged 58% and the loan amount averaged approximately $640,000. Of the 2008 first quarter production for portfolio, 68% consisted of 3/1 and 5/1 hybrid adjustable rate mortgage loans.

Commenting on the decline in both the loan origination volume and the one-to-four family loan portfolio in the first quarter, Mr. Engelke stated, "In addition to accelerated prepayments, we experienced considerable fallout from the pipeline reported at year-end 2007, due primarily to the effect of the tightening of our underwriting standards in late 2007 and early 2008 and the rapid decline in market interest rates during the first quarter, including a decline in jumbo hybrid ARM loan rates by lenders participating in that market. The loan pipeline at the end of the first quarter includes loan applications submitted under our more stringent underwriting standards and with interest rates at or near current market rates. We believe this should lead to a reduction in pipeline fallout and a resumption of growth in the loan portfolio."

In the 2008 first quarter, the multi-family and CRE loan portfolio decreased $71.9 million from the prior quarter end and totaled $3.9 billion at March 31, 2008. Multi-family/CRE loan originations totaled $67.2 million for the 2008 first quarter compared to $134.0 million for the comparable 2007 period and $66.0 million for the 2007 fourth quarter. The loan-to-value ratio of the 2008 first quarter multi-family/CRE loan production averaged 62% and the loan amount averaged approximately $1.5 million.

Asset Quality

Effective January 1, 2008, the presentation of non-performing mortgage loans was changed to report mortgage loans which have missed three or more payments as non-performing in order to improve the transparency of the migration of delinquent loans in our portfolio and improve comparability of our non-performing loan disclosures with other institutions. Previously, our practice was to report mortgage loans that have missed two or more payments as non-performing.

Applying the new presentation to both March 31, 2008 and December 31, 2007, non-performing loans ("NPL") for the quarter ended March 31, 2008 increased $38.5 million from the previous quarter to $106.6 million, or 0.50% of total assets, primarily due to an increase in one-to-four family non-performing loans. At March 31, 2008, one-to-four family non-performing loans totaled $88.4 million and multi-family/CRE non-performing loans totaled $14.9 million.

The comparative table below illustrates the migration from 60-89 days delinquent to 90+ days delinquent under both the previous and revised presentation:

(In millions) 60-89 Days 90 + Days Total 60 + Days Past Due Past Due (NPL) Past Due At 12/31/07(Previously reported) $0.8 $106.4 $107.2 At 12/31/07(As revised) $39.1 $68.1 $107.2 At 03/31/08 $48.8 $106.6 $155.4

The table below details, as of March 31, 2008, the states with a total of 1% or more of our one-to four-family loan portfolio and the respective non-performing loan totals in those states:

Total 1-4 % of 1-4 Total 1-4 NPLs as % (In millions) Family Family Loan Family of State State Loans Portfolio NPLs Total New York Metro* $4,720.6 42% $35.5 0.75% California $1,443.9 13% $ 5.6 0.39% Illinois $1,164.4 10% $ 8.4 0.72% Virginia $956.6 8% $10.0 1.05% Maryland $816.7 7% $11.0 1.35% Massachusetts $734.7 7% $ 4.3 0.59% Florida $349.1 3% $ 6.3 1.80% Georgia $176.4 2% $ 1.9 1.08% Pennsylvania $129.6 1% $ 1.6 1.23% Washington D.C. $119.4 1% $ 0.3 0.25% Washington $120.2 1% $ 0.0 0.00% Total States 1% or More $10,731.6 95% $84.9 * NY, NJ, CT

Commenting on asset quality, Mr. Engelke noted, "Although we have never actively participated in high-risk sub-prime residential lending, as a geographically diversified residential lender, we are not immune to some negative consequences arising from overall economic weakness and, in particular, a sharp downturn in the housing industry nationally. We anticipate our asset quality will remain strong as we maintain our consistently conservative underwriting standards. However, our non-performing loans and credit costs could increase somewhat during the remainder of 2008." Net loan charge-offs for the quarter ended March 31, 2008 totaled $2.9 million compared to $1.3 million for the previous quarter and net recoveries of $155,000 for the 2007 first quarter.

For the quarter March 31, 2008, securities decreased $114.6 million, to $4.3 billion or 20% of total assets at March 31, 2008.

Deposits at March 31, 2008 were relatively unchanged from December 31, 2007 and totaled $13.0 billion. For the quarter ended March 31, 2008, borrowings decreased $332.8 million, to $6.9 billion or 32% of total assets at March 31, 2008. Total assets decreased $265.2 million from the previous quarter to $21.5 billion at March 31, 2008.

Key balance sheet highlights, reflecting the improvement in the quality of the Company's balance sheet since December 31, 1999, follow:

($ in millions) 12/31/ 12/31/ 12/31/ 12/31/ 12/31/ 3/31/ Cumulative 99 01 03 05 07 08 % Change Assets $22,700 $22,672 $22,462 $22,380 $21,719 $21,454 ( 5%) Loans $10,286 $12,167 $12,687 $14,392 $16,155 $15,702 +53% Securities $10,763 $8,013 $8,448 $6,572 $ 4,371 $4,256 (60%) Deposits $9,555 $10,904 $11,187 $12,810 $13,049 $13,004 +36% Borrowings $11,528 $9,826 $9,632 $7,938 $7,185 $ 6,852 (41%)

The following table illustrates the above improvement on an outstanding per share basis:

Amount per share 12/31/ 12/31/ 12/31/ 12/31/ 12/31/ 3/31/ % 99 01 03 05 07 08 Change CAGR Loans $66.28 $89.36 $107.51 $137.11 $168.76 $163.73 147% 12% Deposits $61.57 $80.09 $94.80 $122.04 $136.32 $135.60 120% 10%

Stockholders' equity was $1.2 billion, or 5.74% of total assets, at March 31, 2008. Astoria Federal continues to maintain capital ratios in excess of regulatory requirements with core, tangible and risk-based capital ratios of 6.72%, 6.72% and 12.38%, respectively, at March 31, 2008.

Future Outlook

Commenting on the outlook for 2008, Mr. Engelke stated, "We anticipate the yield curve will remain positively sloped in 2008 providing opportunities for earnings growth and an expansion of our net interest margin. Loan growth should resume as evidenced by the significant increase in the mortgage loan pipeline at March 31, 2008. Deposit growth will remain a focus; however, in the near term, if competitive pricing continues, we will fund some of our loan growth with lower cost borrowings. The Company's tangible capital ratio target remains between 4.50% and 4.75%."

Astoria Financial Corporation, with assets of $21.5 billion, is the holding company for Astoria Federal Savings and Loan Association. Established in 1888, Astoria Federal, with deposits in New York totaling $13.0 billion, is the largest thrift depository headquartered 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 86 convenient banking office locations and multiple delivery channels, including its enhanced website, http://www.astoriafederal.com/. Astoria Federal commands the fourth largest deposit market share in the attractive Long Island market, which includes Brooklyn, Queens, Nassau, and Suffolk counties with a population exceeding that of 38 individual states. Astoria Federal originates mortgage loans through its banking and loan production offices in New York, an extensive broker network covering twenty-two states, primarily the East Coast, and the District of Columbia, and through correspondent relationships covering twenty-nine states and the District of Columbia.

Earnings Conference Call April 17, 2008 at 10:00 a.m. (ET)

The Company, as previously announced, indicated that Mr. Engelke will host an earnings conference call Thursday morning, April 17, 2008 at 10:00 a.m. (ET). The toll-free dial-in number is (888) 562-3356.

A telephone replay will be available on April 17, 2008 from 1:00 p.m. (ET) through April 25, 2008, 11:59 p.m. (ET). The replay number is (800) 642-1687, passcode: 39948071. The conference call will also be simultaneously webcast on the Company's website http://www.astoriafederal.com/ and archived for one year.

Forward Looking Statements

This document contains a number of forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements may be identified by the use of such words as "anticipate," "believe," "could," "estimate," "expect," "intend," "outlook," "plan," "potential," "predict," "project," "should," "will," "would," and similar terms and phrases, including references to assumptions.

Forward-looking statements are based on various assumptions and analyses made by us in light of our management's experience and its perception of historical trends, current conditions and expected future developments, as well as other factors we believe are appropriate under the circumstances. These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors (many of which are beyond our control) that could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. These factors include, without limitation, the following: the timing and occurrence or non-occurrence of events may be subject to circumstances beyond our control; there may be increases in competitive pressure among financial institutions or from non-financial institutions; changes in the interest rate environment may reduce interest margins or affect the value of our investments; changes in deposit flows, loan demand or real estate values may adversely affect our business; changes in accounting principles, policies or guidelines may cause our financial condition to be perceived differently; general economic conditions, either nationally or locally in some or all of the areas in which we do business, or conditions in the real estate or securities markets or the banking industry may be less favorable than we currently anticipate; legislative or regulatory changes may adversely affect our business; applicable technological changes may be more difficult or expensive than we anticipate; success or consummation of new business initiatives may be more difficult or expensive than we anticipate; or litigation or matters before regulatory agencies, whether currently existing or commencing in the future, may be determined adverse to us or may delay the occurrence or non-occurrence of events longer than we anticipate. We assume no obligation to update any forward-looking statements to reflect events or circumstances after the date of this document.

ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (In Thousands, Except Share Data) At At March 31, December 31, 2008 2007 ASSETS Cash and due from banks $75,080 $93,972 Federal funds sold and repurchase agreements 335,160 24,218 Securities available-for-sale 1,345,240 1,313,306 Securities held-to-maturity (fair value of $2,914,315, and $3,013,014, respectively) 2,910,990 3,057,544 Federal Home Loan Bank of New York stock, at cost 191,219 201,490 Loans held-for-sale, net 12,546 6,306 Loans receivable: Mortgage loans, net 15,353,750 15,791,962 Consumer and other loans, net 347,799 363,052 15,701,549 16,155,014 Allowance for loan losses (80,083) (78,946) Total loans receivable, net 15,621,466 16,076,068 Mortgage servicing rights, net 12,273 12,910 Accrued interest receivable 79,174 79,132 Premises and equipment, net 141,317 139,563 Goodwill 185,151 185,151 Bank owned life insurance 402,669 398,280 Other assets 141,893 131,428 TOTAL ASSETS $21,454,178 $21,719,368 LIABILITIES AND STOCKHOLDERS' EQUITY Liabilities: Deposits $13,003,542 $13,049,438 Reverse repurchase agreements 3,630,000 3,730,000 Federal Home Loan Bank of New York advances 2,825,000 3,058,000 Other borrowings, net 396,816 396,658 Mortgage escrow funds 167,423 129,412 Accrued expenses and other liabilities 200,930 144,516 TOTAL LIABILITIES 20,223,711 20,508,024 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 95,899,839, and 95,728,562 shares outstanding, respectively) 1,665 1,665 Additional paid-in capital 840,584 846,227 Retained earnings 1,890,678 1,883,902 Treasury stock (70,595,049 and 70,766,326 shares, at cost, respectively) (1,457,755) (1,459,865) Accumulated other comprehensive loss (23,946) (39,476) Unallocated common stock held by ESOP (5,665,905 and 5,761,391 shares, respectively) (20,759) (21,109) TOTAL STOCKHOLDERS' EQUITY 1,230,467 1,211,344 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $21,454,178 $21,719,368 ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (In Thousands, Except Share Data) For the Three Months Ended March 31, 2008 2007 Interest income: Mortgage loans: One-to-four family $153,598 $136,516 Multi-family, commercial real estate and construction 60,315 64,670 Consumer and other loans 5,432 8,194 Mortgage-backed and other securities 47,893 59,015 Federal funds sold and repurchase agreements 636 976 Federal Home Loan Bank of New York stock 4,222 2,598 Total interest income 272,096 271,969 Interest expense: Deposits 110,203 110,358 Borrowings 81,107 74,084 Total interest expense 191,310 184,442 Net interest income 80,786 87,527 Provision for loan losses 4,000 - Net interest income after provision for loan losses 76,786 87,527 Non-interest income: Customer service fees 15,134 15,169 Other loan fees 1,039 1,218 Mortgage banking income, net 450 616 Income from bank owned life insurance 4,389 4,203 Other 1,425 1,391 Total non-interest income 22,437 22,597 Non-interest expense: General and administrative: Compensation and benefits 31,991 31,124 Occupancy, equipment and systems 16,904 16,521 Federal deposit insurance premiums 571 407 Advertising 1,073 1,915 Other 7,690 7,153 Total non-interest expense 58,229 57,120 Income before income tax expense 40,994 53,004 Income tax expense 12,091 17,227 Net income $28,903 $35,777 Basic earnings per common share $0.32 $0.39 Diluted earnings per common share $0.32 $0.38 Basic weighted average common shares 89,472,902 91,423,546 Diluted weighted average common and common equivalent shares 90,969,684 93,565,256 ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES SELECTED FINANCIAL RATIOS AND OTHER DATA At or For the Three Months Ended March 31, 2008 2007 Selected Returns and Financial Ratios (annualized) Return on average stockholders' equity 9.46 % 11.81 % Return on average tangible stockholders' equity (1) 11.15 13.93 Return on average assets 0.54 0.67 General and administrative expense to average assets 1.08 1.07 Efficiency ratio (2) 56.41 51.87 Net interest rate spread (3) 1.46 1.60 Net interest margin (4) 1.57 1.71 Asset Quality Data (dollars in thousands) (5) Non-performing assets $121,037 $51,343 Non-performing loans 106,604 50,885 Loans 90 days past maturity but still accruing interest 498 473 Non-accrual loans 106,106 50,412 Loans 60-89 days delinquent 48,753 17,878 Net charge-offs (recoveries) 2,863 (155) Non-performing loans/total loans 0.68 % 0.34 % Non-performing loans/total assets 0.50 0.24 Non-performing assets/total assets 0.56 0.24 Allowance for loan losses/non-performing loans 75.12 157.41 Allowance for loan losses/non-accrual loans 75.47 158.88 Allowance for loan losses/total loans 0.51 0.53 Net charge-offs to average loans outstanding (annualized) 0.07 0.00 Capital Ratios (Astoria Federal) Tangible 6.72 % 6.88 % Core 6.72 6.88 Risk-based 12.38 12.66 Other Data Cash dividends paid per common share $0.26 $0.26 Dividend payout ratio 81.25 % 68.42 % Book value per share (6) $13.64 $13.32 Tangible book value per share (7) $11.58 $11.30 Tangible stockholders' equity/tangible assets (1) (8) 4.91 % 4.87 % Mortgage loans serviced for others (in thousands) $1,253,565 $1,334,523 Full time equivalent employees 1,597 1,612 (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) Net interest rate spread represents the difference between the average yield on average interest-earning assets and the average cost of average interest-bearing liabilities. (4) Net interest margin represents net interest income divided by average interest-earning assets. (5) Loans totaling $17.1 million have been reclassified from non-accrual to 60-89 days delinquent as of March 31, 2007 to conform the March 31, 2007 information to the current year presentation. The related March 31, 2007 asset quality ratios have been revised as necessary. (6) Book value per share represents stockholders' equity divided by outstanding shares, excluding unallocated Employee Stock Ownership Plan, or ESOP, shares. (7) Tangible book value per share represents stockholders' equity less goodwill divided by outstanding shares, excluding unallocated ESOP shares. (8) Tangible assets represent assets less goodwill. ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES AVERAGE BALANCE SHEETS (Dollars in Thousands) For the Three Months Ended March 31, 2008 Average Average Yield/ Balance Interest Cost (Annual- ized) Assets: Interest-earning assets: Mortgage loans (1): One-to-four family $11,621,739 $153,598 5.29 % Multi-family, commercial real estate and construction 4,005,674 60,315 6.02 Consumer and other loans (1) 356,057 5,432 6.10 Total loans 15,983,470 219,345 5.49 Mortgage-backed and other securities (2) 4,296,912 47,893 4.46 Federal funds sold and repurchase agreements 94,168 636 2.70 Federal Home Loan Bank stock 196,115 4,222 8.61 Total interest-earning assets 20,570,665 272,096 5.29 Goodwill 185,151 Other non-interest-earning assets 784,963 Total assets $21,540,779 Liabilities and stockholders' equity: Interest-bearing liabilities: Savings $1,874,158 1,888 0.40 Money market 323,951 804 0.99 NOW and demand deposit 1,446,491 312 0.09 Liquid certificates of deposit 1,424,505 14,493 4.07 Total core deposits 5,069,105 17,497 1.38 Certificates of deposit 7,892,672 92,706 4.70 Total deposits 12,961,777 110,203 3.40 Borrowings 7,007,827 81,107 4.63 Total interest-bearing liabilities 19,969,604 191,310 3.83 Non-interest-bearing liabilities 348,711 Total liabilities 20,318,315 Stockholders' equity 1,222,464 Total liabilities and stockholders' equity $21,540,779 Net interest income/net interest rate spread $80,786 1.46 % Net interest-earning assets/net interest margin $601,061 1.57 % Ratio of interest-earning assets to interest-bearing liabilities 1.03x For the Three Months Ended March 31, 2007 Average Average Yield/ Balance Interest Cost (Annual- ized) Assets: Interest-earning assets: Mortgage loans (1): One-to-four family $10,386,038 $136,516 5.26 % Multi-family, commercial real estate and construction 4,228,924 64,670 6.12 Consumer and other loans (1) 430,961 8,194 7.61 Total loans 15,045,923 209,380 5.57 Mortgage-backed and other securities (2) 5,230,750 59,015 4.51 Federal funds sold and repurchase agreements 74,480 976 5.24 Federal Home Loan Bank stock 148,670 2,598 6.99 Total interest-earning assets 20,499,823 271,969 5.31 Goodwill 185,151 Other non-interest-earning assets 759,771 Total assets $21,444,745 Liabilities and stockholders' equity: Interest-bearing liabilities: Savings $2,099,668 2,087 0.40 Money market 421,912 1,037 0.98 NOW and demand deposit 1,464,753 211 0.06 Liquid certificates of deposit 1,524,410 18,536 4.86 Total core deposits 5,510,743 21,871 1.59 Certificates of deposit 7,699,828 88,487 4.60 Total deposits 13,210,571 110,358 3.34 Borrowings 6,685,759 74,084 4.43 Total interest-bearing liabilities 19,896,330 184,442 3.71 Non-interest-bearing liabilities 336,204 Total liabilities 20,232,534 Stockholders' equity 1,212,211 Total liabilities and stockholders' equity $21,444,745 Net interest income/net interest rate spread $87,527 1.60 % Net interest-earning assets/net interest margin $603,493 1.71 % Ratio of interest-earning assets to interest-bearing liabilities 1.03x (1) Mortgage loans and consumer and other loans include loans held-for-sale and non-performing loans and exclude the allowance for loan losses. (2) Securities available-for-sale are included at average amortized cost. ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES END OF PERIOD BALANCES AND RATES (Dollars in Thousands) At March 31, 2008 At December 31, 2007 Weighted Weighted Average Average Balance Rate (1) Balance Rate (1) Selected interest-earning assets: Mortgage loans, gross (2): One-to-four family $11,275,550 5.69 % $11,628,270 5.70 % Multi-family, commercial real estate and construction 3,973,315 5.89 4,055,081 5.92 Mortgage-backed and other securities (3) 4,256,230 4.32 4,370,850 4.33 Interest-bearing liabilities: Savings 1,878,444 0.40 1,891,618 0.40 Money market 321,039 1.00 333,914 0.98 NOW and demand deposit 1,495,023 0.06 1,478,362 0.06 Liquid certificates of deposit 1,390,368 3.42 1,447,341 4.40 Total core deposits 5,084,874 1.16 5,151,235 1.46 Certificates of deposit 7,918,668 4.58 7,898,203 4.79 Total deposits 13,003,542 3.24 13,049,438 3.48 Borrowings, net 6,851,816 4.55 7,184,658 4.66 At March 31, 2007 Weighted Average Balance Rate (1) Selected interest-earning assets: Mortgage loans, gross (2): One-to-four family $10,370,347 5.51 % Multi-family, commercial real estate and construction 4,216,228 5.94 Mortgage-backed and other securities (3) 5,087,727 4.34 Interest-bearing liabilities: Savings 2,084,922 0.40 Money market 411,337 1.00 NOW and demand deposit 1,527,864 0.06 Liquid certificates of deposit 1,624,660 4.93 Total core deposits 5,648,783 1.65 Certificates of deposit 7,773,223 4.71 Total deposits 13,422,006 3.42 Borrowings, net 6,396,172 4.47 (1) Weighted average rates represent stated or coupon interest rates excluding the effect of yield adjustments for premiums, discounts and deferred loan origination fees and costs and the impact of prepayment penalties. (2) Mortgage loans exclude loans held-for-sale and include non-performing loans. (3) Securities available-for-sale are reported at fair value and securities held-to-maturity are reported at amortized cost.