Astoria Financial Corporation Announces Second Quarter EPS of $0.37

LAKE SUCCESS, N.Y., July 18 /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 $34.1 million, or $0.37 diluted earnings per share ("EPS"), for the quarter ended June 30, 2007, compared to $47.8 million, or $0.49 EPS, for the 2006 second quarter. For the 2007 second quarter, annualized returns on average equity, average tangible equity and average assets were 11.35%, 13.42% and 0.63%, respectively, compared to 14.94%, 17.48% and 0.87%, respectively, for the comparable 2006 period.

For the six months ended June 30, 2007, net income totaled $69.8 million, or $0.75 EPS, compared to $96.7 million, or $0.98 EPS, for the comparable 2006 period. For the six months ended June 30, 2007, annualized returns on average equity, average tangible equity and average assets were 11.59%, 13.70% and 0.65%, respectively, compared to 14.87%, 17.34% and 0.87%, respectively, for the comparable 2006 period.

First Half 2007 Balance Sheet Highlights: -- Loan portfolio increased $611 million, or 8% annualized -- One-to-four family loan portfolio increased $695 million, or 14% annualized -- Deposits increased $224 million, or 3% annualized -- Securities portfolio decreased $552 million, or 21% annualized -- Borrowings decreased $138 million, or 4% annualized -- Repurchased 1.8 million shares

Commenting on the 2007 second quarter results, George L. Engelke, Jr., Chairman, President and Chief Executive Officer of Astoria, noted, "The inverted yield curve, which has persisted for over a year, has recently become slightly positively sloped. While the recent increase in long-term interest rates is positive, there is a lag in the benefit to Astoria, as our interest- bearing liabilities continue to reprice somewhat faster than our interest- earning assets. During this challenging environment, I am pleased to report that we have continued to increase both loans and deposits during the second quarter, while controlling operating expenses and maintaining excellent asset quality."

Board Declares Quarterly Cash Dividend of $0.26 Per Share

The Board of Directors of the Company, at their July 18, 2007 meeting, declared a quarterly cash dividend of $0.26 per common share. The dividend is payable on September 4, 2007 to shareholders of record as of August 15, 2007. This is the forty-ninth consecutive quarterly cash dividend declared by the Company.

Eleventh Stock Repurchase Program Continues; Twelfth Stock Repurchase Program In Place

During the 2007 second quarter, Astoria repurchased 750,000 shares of its common stock at an average cost of $26.65 per share. Under the eleventh stock repurchase program, 117,300 shares remain available for repurchase as of June 30, 2007. During the six month period ended June 30, 2007 Astoria repurchased a total of 1.8 million shares. The Company, as previously announced, has in place its twelfth stock repurchase program which authorizes the repurchase of ten million shares of its common stock. The twelfth stock repurchase program will commence immediately upon completion of the eleventh stock repurchase program.

Second Quarter and Six Month Earnings Summary

Net interest income for the quarter ended June 30, 2007 totaled $82.9 million compared to $87.5 million for the 2007 first quarter and $101.3 million for the second quarter a year ago. For the six months ended June 30, 2007, net interest income totaled $170.4 million compared to $212.9 million for the comparable 2006 six month period.

Astoria's net interest margin for the quarter ended June 30, 2007 was 1.62% compared to 1.71% for the 2007 first quarter and 1.92% for the quarter ended June 30, 2006. On a linked quarter basis, in addition to the impact of the cost of interest-bearing liabilities rising more rapidly than the yield on interest-earning assets, approximately four basis points of the nine basis point decline is due to one extra day of interest expense in the second quarter. The year over year decrease in the net interest margin is also due to the cost of interest-bearing liabilities rising more rapidly than the yield on interest-earning assets.

Non-interest income for the quarter ended June 30, 2007 increased to $26.3 million from $25.7 million for the 2006 second quarter. The increase is primarily due to a $2.0 million gain related to an insurance payment received in the 2007 second quarter, partially offset by lower mortgage banking income, net.

For the six months ended June 30, 2007, non-interest income totaled $48.9 million compared to $44.6 million for the comparable 2006 period. Non- interest income for the 2007 six month period reflected a decrease of $1.8 million in mortgage banking income, net, while the 2006 six month period included a $5.5 million, pre-tax, charge related to the termination of interest rate swap agreements in the 2006 first quarter.

The components of mortgage banking income, net, which is included in non- interest income, are detailed below:

(Dollars in millions) 2Q07 2Q06 1H07 1H06 Loan servicing fees $ 1.0 $ 1.1 $ 2.0 $ 2.3 Amortization of MSR* (0.9) (0.9) (1.9) (1.9) MSR* valuation adjustments 0.5 1.3 0.7 2.0 Net gain on sale of loans 0.6 0.6 1.0 1.2 Mortgage banking income, net $ 1.2 $ 2.1 $ 1.8 $ 3.6 * Mortgage servicing rights

General and administrative expense ("G&A") for the quarter ended June 30, 2007 increased to $58.7 million from $57.1 million for the 2007 first quarter and $55.2 million for the comparable 2006 period. The linked quarter increase is primarily due to a $2.3 million increase in goodwill litigation expense, offset primarily by lower compensation and benefits expense. The year over year increase is due primarily to increases in goodwill litigation expense and compensation and benefits expense.

For the six months ended June 30, 2007, G&A increased $4.3 million to $115.8 million from $111.5 million for the comparable 2006 period. The increase was primarily due to a $2.8 million increase in goodwill litigation expense and a $2.3 million increase in compensation and benefits expense.

Balance Sheet Summary

For the 2007 second quarter, the total loan portfolio increased $486.6 million to $15.6 billion at June 30, 2007 due to loan originations and purchases totaling $1.4 billion compared to $744.7 million for the comparable 2006 period.

For the six month period ended June 30, 2007, the total loan portfolio increased $610.6 million, or 8% annualized, due to loan originations and purchases totaling $2.3 billion compared to $1.5 billion for the comparable 2006 period. The loan pipeline at June 30, 2007 totaled $1.0 billion, a decrease of $344.6 million from March 31, 2007.

For the 2007 second quarter, the 1-4 family mortgage loan portfolio increased $539.2 million and totaled $10.9 billion at June 30, 2007. 1-4 family loan originations and purchases totaled $1.3 billion for the 2007 second quarter compared to $554.3 million in the 2006 second quarter. Of the 2007 second quarter 1-4 family loan production, 78% consisted of 3/1 and 5/1 hybrid adjustable rate mortgage loans.

For the six months ended June 30, 2007, the 1-4 family mortgage loan portfolio increased $695.4 million due to 1-4 family loan originations and purchases totaling $2.0 billion compared to $1.1 billion in the 2006 six month period. Of the 2007 six month 1-4 family loan production, 76% consisted of 3/1 and 5/1 hybrid adjustable rate mortgage loans.

For the 2007 second quarter, the multi-family and commercial real estate ("CRE") loan portfolio decreased $27.3 million primarily due to lower loan originations which totaled $119.9 million compared to $183.7 million for the comparable 2006 period. At June 30, 2007, the combined multi-family and CRE loan portfolio totaled $4.1 billion, or 26% of total loans.

For the six months ended June 30, 2007, the multi-family and CRE loan portfolio decreased $21.9 million primarily due to lower loan originations which totaled $253.9 million compared to $401.1 million in the 2006 six month period. The average loan-to-value ratio of the combined multi-family and CRE loan portfolio continues to be less than 65%, based on current principal balance and original appraised value, and the average loan balance is less than $1 million.

For the quarter ended June 30, 2007, non-performing loans decreased $3.9 million, or 6%, and totaled $64.0 million, or 0.30% of total assets, from $67.9 million, or 0.32% of total assets, at March 31, 2007. As of June 30, 2007, 1-4 family non-performing loans totaled $53.5 million and multi-family and CRE non-performing loans totaled $8.8 million. The ratio of the allowance for loan losses to non-performing loans at June 30, 2007 was 124%.

Net loan charge-offs for the quarter ended June 30, 2007 totaled $698,000 compared to net loan recoveries of $155,000 for the 2007 first quarter. For the six months ended June 30, 2007, net loan charge-offs totaled $543,000 compared to $96,000 for the 2006 six month period, or less than one basis point of average loans outstanding, annualized, for each period.

Deposits increased $25.9 million during the 2007 second quarter and totaled $13.4 billion at June 30, 2007. For the six months ended June 30, 2007, deposits increased $223.8 million, or 3% annualized.

For the quarter ended June 30, 2007, securities declined $300.1 million to $4.8 billion at June 30, 2007, representing 22% of total assets. For the six months ended June 30, 2007, securities declined $552.0 million, or 21% annualized. Borrowings increased $302.2 million in the 2007 second quarter, to $6.7 billion at June 30, 2007, representing 31% of total assets. For the six months ended June 30, 2007, borrowings declined $137.7 million, or 4% annualized. Total assets increased slightly from December 31, 2006 to $21.6 billion at June 30, 2007.

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

($ in millions) 12/31/99 12/31/01 12/31/03 12/31/05 Assets $22,700 $22,672 $22,462 $22,380 Loans $10,286 $12,167 $12,687 $14,392 Securities $10,763 $8,013 $8,448 $6,572 Deposits $9,555 $10,904 $11,187 $12,810 Borrowings $11,528 $9,826 $9,632 $7,938 ($ in millions) Cumulative 12/31/06 06/30/07 % Change Assets $21,555 $21,650 ( 5%) Loans $14,972 $15,582 + 51% Securities $5,340 $4,788 (56%) Deposits $13,224 $13,448 + 41% Borrowings $6,836 $6,698 (42%)

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

Amount per share 12/31/99 12/31/01 12/31/03 12/31/05 Loans $ 66.28 $ 89.36 $107.51 $137.11 Deposits $ 61.57 $ 80.09 $ 94.80 $122.04 Amount per share 12/31/06 06/30/07 % Change CAGR Loans $152.44 $160.89 143% 13% Deposits $134.65 $138.85 126% 11%

Stockholders' equity was $1.2 billion, or 5.52% of total assets at June 30, 2007. Astoria Federal continues to maintain capital ratios in excess of regulatory requirements with core, tangible and risk-based capital ratios of 6.65%, 6.65% and 12.19%, respectively, at June 30, 2007.

Future Outlook

Commenting on the outlook for the second half of 2007, Mr. Engelke stated, "The operating environment has improved slightly in the last several months, but remains challenging. The yield curve, which has recently become positively sloped, still remains relatively flat, limiting profitable growth opportunities. We expect the yield curve to remain relatively flat for the remainder of 2007 and into 2008 which will result in a relatively stable net interest margin for 2007, similar to the 2007 second quarter margin. We will, therefore, maintain our strategy of reducing the securities portfolio while we emphasize deposit and loan growth, all of which will continue to improve the quality of both the balance sheet and earnings. We will also focus on the repurchase of our stock as a very desirable use of capital, maintaining the Company's tangible capital levels between 4.50% and 4.75%."

Astoria Financial Corporation, the holding company for Astoria Federal Savings and Loan Association, with assets of $21.6 billion is the sixth largest thrift institution in the United States. Established in 1888, Astoria Federal is the largest thrift depository headquartered in New York with deposits of $13.4 billion and embraces its philosophy of "Putting people first" by providing the customers and local communities it serves with quality financial products and services through 86 convenient banking office locations and multiple delivery channels, including its enhanced website, http://www.astoriafederal.com/. Astoria Federal commands the fourth largest deposit market share in the attractive Long Island market, which includes Brooklyn, Queens, Nassau, and Suffolk counties with a population exceeding that of 38 individual states. Astoria Federal originates mortgage loans through its banking offices and loan production offices in New York, an extensive broker network covering twenty-six states, primarily the East Coast, and the District of Columbia, and through correspondent relationships covering forty-three states and the District of Columbia.

Earnings Conference Call July 19, 2007 at 9:30 a.m. (ET)

The Company, as previously announced, indicated that Mr. Engelke will host an earnings conference call Thursday morning, July 19, 2007 at 9:30 a.m. (ET). The toll-free dial-in number is (888) 562-3356, conference ID # 8921889. A telephone replay will be available on July 19, 2007 from 1:00 p.m. (ET) through Friday, July 27, 2007, 11:59 p.m. (ET). The replay number is (877) 519-4471, ID # 8921889. 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 June 30, December 31, 2007 2006 ASSETS Cash and due from banks $162,409 $134,016 Repurchase agreements 44,482 71,694 Securities available-for-sale 1,396,922 1,560,325 Securities held-to-maturity (fair value of $3,274,832 and $3,681,514, respectively) 3,390,713 3,779,356 Federal Home Loan Bank of New York stock, at cost 155,601 153,640 Loans held-for-sale, net 20,772 16,542 Loans receivable: Mortgage loans, net 15,188,465 14,532,503 Consumer and other loans, net 393,840 439,188 15,582,305 14,971,691 Allowance for loan losses (79,399) (79,942) Total loans receivable, net 15,502,906 14,891,749 Mortgage servicing rights, net 15,354 15,944 Accrued interest receivable 78,161 78,761 Premises and equipment, net 142,977 145,231 Goodwill 185,151 185,151 Bank owned life insurance 393,933 385,952 Other assets 160,490 136,158 TOTAL ASSETS $21,649,871 $21,554,519 LIABILITIES AND STOCKHOLDERS' EQUITY Liabilities: Deposits $13,447,856 $13,224,024 Reverse repurchase agreements 4,280,000 4,480,000 Federal Home Loan Bank of New York advances 2,002,000 1,940,000 Other borrowings, net 416,342 416,002 Mortgage escrow funds 151,733 132,080 Accrued expenses and other liabilities 156,908 146,659 TOTAL LIABILITIES 20,454,839 20,338,765 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 96,851,570 and 98,211,827 shares outstanding, respectively) 1,665 1,665 Additional paid-in capital 838,791 828,940 Retained earnings 1,877,237 1,856,528 Treasury stock (69,643,318 and 68,283,061 shares, at cost, respectively) (1,430,864) (1,390,495) Accumulated other comprehensive loss (69,947) (58,330) Unallocated common stock held by ESOP (5,963,755 and 6,155,918 shares, respectively) (21,850) (22,554) TOTAL STOCKHOLDERS' EQUITY 1,195,032 1,215,754 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $21,649,871 $21,554,519 ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (In Thousands, Except Share Data) For the Three Months For the Six Months Ended Ended June 30, June 30, 2007 2006 2007 2006 Interest income: Mortgage loans: One-to-four family $141,568 $125,606 $278,084 $250,491 Multi-family, commercial real estate and construction 64,438 63,986 129,108 126,245 Consumer and other loans 7,812 8,972 16,006 17,819 Mortgage-backed and other securities 55,885 68,532 114,900 140,427 Federal funds sold and repurchase agreements 499 2,296 1,475 3,939 Federal Home Loan Bank of New York stock 2,749 1,797 5,347 3,486 Total interest income 272,951 271,189 544,920 542,407 Interest expense: Deposits 114,096 90,549 224,454 173,254 Borrowings 75,964 79,324 150,048 156,291 Total interest expense 190,060 169,873 374,502 329,545 Net interest income 82,891 101,316 170,418 212,862 Provision for loan losses - - - - Net interest income after provision for loan losses 82,891 101,316 170,418 212,862 Non-interest income: Customer service fees 16,159 16,440 31,328 33,038 Other loan fees 1,110 962 2,328 1,772 Mortgage banking income, net 1,224 2,147 1,840 3,629 Income from bank owned life insurance 4,287 4,031 8,490 8,106 Other 3,500 2,147 4,891 (1,921) Total non-interest income 26,280 25,727 48,877 44,624 Non-interest expense: General and administrative: Compensation and benefits 30,046 28,528 61,170 58,839 Occupancy, equipment and systems 16,494 16,297 33,015 33,105 Federal deposit insurance premiums 407 415 814 849 Advertising 1,977 1,902 3,892 3,829 Other 9,783 8,077 16,936 14,906 Total non-interest expense 58,707 55,219 115,827 111,528 Income before income tax expense 50,464 71,824 103,468 145,958 Income tax expense 16,400 24,061 33,627 49,261 Net income $34,064 $47,763 $69,841 $96,697 Basic earnings per common share $0.38 $0.50 $0.77 $1.00 Diluted earnings per common share $0.37 $0.49 $0.75 $0.98 Basic weighted average common shares 90,704,749 95,477,528 91,062,161 96,386,742 Diluted weighted average common and common equivalent shares 92,166,978 98,059,723 92,864,131 98,974,405 ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES SELECTED FINANCIAL RATIOS AND OTHER DATA For the At or For the Three Months Ended Six Months Ended June 30, June 30, 2007 2006 2007 2006 Selected Returns and Financial Ratios (annualized) Return on average stockholders' equity 11.35 % 14.94 % 11.59 % 14.87 % Return on average tangible stockholders' equity (1) 13.42 17.48 13.70 17.34 Return on average assets 0.63 0.87 0.65 0.87 General and administrative expense to average assets 1.09 1.00 1.08 1.01 Efficiency ratio (2) 53.78 43.46 52.82 43.31 Net interest rate spread (3) 1.50 1.82 1.55 1.91 Net interest margin (4) 1.62 1.92 1.66 2.01 Selected Non-GAAP Returns and Financial Ratios (annualized) (5) Non-GAAP return on average stockholders' equity 11.59 % 15.43 % Non-GAAP return on average tangible stockholders' equity (1) 13.70 17.99 Non-GAAP return on average assets 0.65 0.91 Non-GAAP efficiency ratio (2) 52.82 42.42 Asset Quality Data (dollars in thousands) Non-performing loans/total loans 0.41 % 0.37 % Non-performing loans/total assets 0.30 0.25 Non-performing assets/total assets 0.30 0.25 Allowance for loan losses/non- performing loans 124.07 149.31 Allowance for loan losses/non-accrual loans 125.29 150.81 Allowance for loan losses/total loans 0.51 0.55 Net charge-offs to average loans outstanding (annualized) 0.02 % 0.00 % 0.01 0.00 Non-performing assets $65,921 $55,361 Non-performing loans 63,996 54,290 Loans 90 days past maturity but still accruing interest 625 537 Non-accrual loans 63,371 53,753 Net charge-offs $698 $80 543 96 Capital Ratios (Astoria Federal) Tangible 6.65 % 6.53 % Core 6.65 6.53 Risk-based 12.19 12.22 Other Data Cash dividends paid per common share $0.26 $0.24 $0.52 $0.48 Dividend payout ratio 70.27 % 48.98 % 69.33 % 48.98 % Book value per share (6) $13.15 $13.38 Tangible book value per share (7) $11.11 $11.43 Tangible stockholders' equity/tangible assets (1) (8) 4.70 % 5.00 % Mortgage loans serviced for others (in thousands) $1,305,916 $1,430,746 Full time equivalent employees 1,628 1,635 (1) Tangible stockholders' equity represents stockholders' equity less goodwill. (2) The efficiency ratio represents general and administrative expense divided by the sum of net interest income plus non-interest income. Net interest rate spread represents the difference between the average (3) yield on average interest-earning assets and the average cost of average interest-bearing liabilities. (4) Net interest margin represents net interest income divided by average interest-earning assets. (5) The information presented for the six months ended June 30, 2006 represents pro forma calculations which are not in conformity with U.S. generally accepted accounting principles, or GAAP. The 2006 information excludes the $3.6 million, after tax, ($5.5 million, before tax) charge for the termination of our interest rate swap agreements recorded in the 2006 first quarter. See page 12 for a reconciliation of GAAP net income to non-GAAP earnings for the six months ended June 30, 2006. (6) Book value per share represents stockholders' equity divided by outstanding shares, excluding unallocated Employee Stock Ownership Plan, or ESOP, shares. (7) Tangible book value per share represents stockholders' equity less goodwill divided by outstanding shares, excluding unallocated ESOP shares. (8) Tangible assets represent assets less goodwill. ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES AVERAGE BALANCE SHEETS (Dollars in Thousands) For the Three Months Ended June 30, 2007 Average Average Yield/ Balance Interest Cost (Annualized) Assets: Interest-earning assets: Mortgage loans (1): One-to-four family $10,749,335 $141,568 5.27 % Multi-family, commercial real estate and construction 4,200,044 64,438 6.14 Consumer and other loans (1) 406,437 7,812 7.69 Total loans 15,355,816 213,818 5.57 Mortgage-backed and other securities (2) 4,964,564 55,885 4.50 Federal funds sold and repurchase agreements 37,742 499 5.29 Federal Home Loan Bank stock 155,056 2,749 7.09 Total interest-earning assets 20,513,178 272,951 5.32 Goodwill 185,151 Other non-interest-earning assets 763,554 Total assets $21,461,883 Liabilities and stockholders' equity: Interest-bearing liabilities: Savings $2,061,648 2,074 0.40 Money market 391,139 970 0.99 NOW and demand deposit 1,495,582 214 0.06 Liquid certificates of deposit 1,659,796 20,241 4.88 Total core deposits 5,608,165 23,499 1.68 Certificates of deposit 7,724,775 90,597 4.69 Total deposits 13,332,940 114,096 3.42 Borrowings 6,562,399 75,964 4.63 Total interest-bearing liabilities 19,895,339 190,060 3.82 Non-interest-bearing liabilities 365,877 Total liabilities 20,261,216 Stockholders' equity 1,200,667 Total liabilities and stockholders' equity $21,461,883 Net interest income/net interest rate spread $82,891 1.50 % Net interest-earning assets/net interest margin $617,839 1.62 % Ratio of interest-earning assets to interest-bearing liabilities 1.03x For the Three Months Ended June 30, 2006 Average Average Yield/ Balance Interest Cost (Annualized) Assets: Interest-earning assets: Mortgage loans (1): One-to-four family $9,920,003 $125,606 5.06 % Multi-family, commercial real estate and construction 4,214,459 63,986 6.07 Consumer and other loans (1) 490,463 8,972 7.32 Total loans 14,624,925 198,564 5.43 Mortgage-backed and other securities (2) 6,099,829 68,532 4.49 Federal funds sold and repurchase agreements 189,049 2,296 4.86 Federal Home Loan Bank stock 142,884 1,797 5.03 Total interest-earning assets 21,056,687 271,189 5.15 Goodwill 185,151 Other non-interest-earning assets 778,676 Total assets $22,020,514 Liabilities and stockholders' equity: Interest-bearing liabilities: Savings $2,396,537 2,405 0.40 Money market 563,782 1,381 0.98 NOW and demand deposit 1,540,556 224 0.06 Liquid certificates of deposit 966,457 10,397 4.30 Total core deposits 5,467,332 14,407 1.05 Certificates of deposit 7,485,159 76,142 4.07 Total deposits 12,952,491 90,549 2.80 Borrowings 7,433,642 79,324 4.27 Total interest-bearing liabilities 20,386,133 169,873 3.33 Non-interest-bearing liabilities 355,948 Total liabilities 20,742,081 Stockholders' equity 1,278,433 Total liabilities and stockholders' equity $22,020,514 Net interest income/net interest rate spread $101,316 1.82 % Net interest-earning assets/net interest margin $670,554 1.92 % 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 AVERAGE BALANCE SHEETS (Dollars in Thousands) For the Six Months Ended June 30, 2007 Average Average Yield/ Balance Interest Cost (Annualized) Assets: Interest-earning assets: Mortgage loans (1): One-to-four family $10,568,690 $278,084 5.26 % Multi-family, commercial real estate and construction 4,214,404 129,108 6.13 Consumer and other loans (1) 418,631 16,006 7.65 Total loans 15,201,725 423,198 5.57 Mortgage-backed and other securities (2) 5,096,922 114,900 4.51 Federal funds sold and repurchase agreements 56,009 1,475 5.27 Federal Home Loan Bank stock 151,880 5,347 7.04 Total interest-earning assets 20,506,536 544,920 5.31 Goodwill 185,151 Other non-interest-earning assets 760,102 Total assets $21,451,789 Liabilities and stockholders' equity: Interest-bearing liabilities: Savings $2,080,553 4,161 0.40 Money market 406,441 2,007 0.99 NOW and demand deposit 1,480,253 425 0.06 Liquid certificates of deposit 1,592,477 38,777 4.87 Total core deposits 5,559,724 45,370 1.63 Certificates of deposit 7,712,371 179,084 4.64 Total deposits 13,272,095 224,454 3.38 Borrowings 6,623,738 150,048 4.53 Total interest-bearing liabilities 19,895,833 374,502 3.76 Non-interest-bearing liabilities 351,122 Total liabilities 20,246,955 Stockholders' equity 1,204,834 Total liabilities and stockholders' equity $21,451,789 Net interest income/net interest rate spread $170,418 1.55 % Net interest-earning assets/net interest margin $610,703 1.66 % Ratio of interest-earning assets to interest-bearing liabilities 1.03x For the Six Months Ended June 30, 2006 Average Average Yield/ Balance Interest Cost (Annualized) Assets: Interest-earning assets: Mortgage loans (1): One-to-four family $9,905,279 $250,491 5.06 % Multi-family, commercial real estate and construction 4,153,353 126,245 6.08 Consumer and other loans (1) 498,280 17,819 7.15 Total loans 14,556,912 394,555 5.42 Mortgage-backed and other securities (2) 6,263,198 140,427 4.48 Federal funds sold and repurchase agreements 170,104 3,939 4.63 Federal Home Loan Bank stock 140,855 3,486 4.95 Total interest-earning assets 21,131,069 542,407 5.13 Goodwill 185,151 Other non-interest-earning assets 792,174 Total assets $22,108,394 Liabilities and stockholders' equity: Interest-bearing liabilities: Savings $2,432,131 4,855 0.40 Money market 592,217 2,854 0.96 NOW and demand deposit 1,528,357 444 0.06 Liquid certificates of deposit 848,717 17,452 4.11 Total core deposits 5,401,422 25,605 0.95 Certificates of deposit 7,517,750 147,649 3.93 Total deposits 12,919,172 173,254 2.68 Borrowings 7,542,721 156,291 4.14 Total interest-bearing liabilities 20,461,893 329,545 3.22 Non-interest-bearing liabilities 345,909 Total liabilities 20,807,802 Stockholders' equity 1,300,592 Total liabilities and stockholders' equity $22,108,394 Net interest income/net interest rate spread $212,862 1.91 % Net interest-earning assets/net interest margin $669,176 2.01 % 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 June 30, 2007 At March 31, 2007 Weighted Weighted Average Average Balance Rate (1) Balance Rate (1) Selected interest-earning assets: Mortgage loans, gross (2): One-to-four family $10,909,568 5.58% $10,370,347 5.51% Multi-family, commercial real estate and construction 4,179,772 5.94 4,216,228 5.94 Mortgage-backed and other securities (3) 4,787,635 4.34 5,087,727 4.34 Interest-bearing liabilities: Savings 2,025,132 0.40 2,084,922 0.40 Money market 377,455 1.00 411,337 1.00 NOW and demand deposit 1,489,624 0.06 1,527,864 0.06 Liquid certificates of deposit 1,664,176 4.83 1,624,660 4.93 Total core deposits 5,556,387 1.68 5,648,783 1.65 Certificates of deposit 7,891,469 4.76 7,773,223 4.71 Total deposits 13,447,856 3.49 13,422,006 3.42 Borrowings, net 6,698,342 4.62 6,396,172 4.47 At June 30, 2006 Weighted Average Balance Rate (1) Selected interest-earning assets: Mortgage loans, gross (2): One-to-four family $ 9,824,066 5.32% Multi-family, commercial real estate and construction 4,245,697 5.95 Mortgage-backed and other securities (3) 5,870,733 4.34 Interest-bearing liabilities: Savings 2,352,923 0.40 Money market 537,602 1.01 NOW and demand deposit 1,535,833 0.06 Liquid certificates of deposit 1,117,478 4.54 Total core deposits 5,543,836 1.20 Certificates of deposit 7,548,396 4.26 Total deposits 13,092,232 2.96 Borrowings, net 7,202,662 4.29 (1) Weighted average rates represent stated or coupon interest rates excluding the effect of yield adjustments for premiums, discounts and deferred loan origination fees and costs and the impact of prepayment penalties. (2) Mortgage loans exclude loans held-for-sale and include non-performing loans. (3) Securities available-for-sale are reported at fair value and securities held-to-maturity are reported at amortized cost. RECONCILIATION OF 2006 GAAP NET INCOME TO NON-GAAP EARNINGS (In Thousands, Except Per Share Data) For the Six Months Ended June 30, 2006 GAAP Adjustments (4) Non-GAAP Net interest income after provision for loan losses $ 212,862 $ - $ 212,862 Non-interest income 44,624 5,456 50,080 Non-interest expense 111,528 - 111,528 Income before income tax expense 145,958 5,456 151,414 Income tax expense 49,261 1,841 51,102 Net income $96,697 $ 3,615 $ 100,312 Basic earnings per common share $1.00 $0.04 $1.04 Diluted earnings per common share $0.98 $0.04 $1.01 (5) (4) Adjustments relate to the $5.5 million charge for the termination of our interest rate swap agreements and the related tax effects. (5) Figures do not cross foot due to rounding.