Growth in Earning Assets, Higher Net Interest Margin and Sustained Credit Quality are Main Factors Driving Increased Profitability NEW YORK, July 24
NEW YORK, July 24 /PRNewswire-FirstCall/ -- Sterling Bancorp (NYSE: STL),
the parent company of New York City-based Sterling National Bank, today
reported strong results for the second quarter and six months ended June 30,
2008, highlighted by double-digit growth in net income, higher loan balances
and sound credit quality.
Net income for the 2008 second quarter rose to $4.2 million or $0.23 per
diluted share, an EPS increase of 15% compared with $3.9 million or $0.20 per
diluted share a year ago. For the first half of this year, net income was
$8.2 million or $0.45 per diluted share, versus $7.3 million or $0.39 per
share for the first six months of 2007.
Sterling attributed its strong performance, despite the challenging
financial markets, to a well-established focus on serving business customers
in the NY-Metropolitan region and beyond, prudent underwriting practices and
avoidance of high-risk asset classes.
Second Quarter Highlights:
-- Earnings Growth - Diluted EPS of $0.23 was 15% higher than the same
quarter of last year and also was up from the first quarter of 2008.
-- Sound Asset Quality - The ratio of nonperforming loans to total loans
at June 30, 2008 was 0.58%, compared with 0.50% at June 30, 2007.
-- Higher Net Interest Margin - The net interest margin, on a
tax-equivalent basis, rose by 14 basis points to 4.49%, from 4.35% a year ago.
-- Increased Loan Volume - Loans held in portfolio averaged $1,121.9
million for the recent quarter, up approximately 7% from a year ago.
-- Strong Core Deposits - Demand deposits averaged $444.7 million for the
quarter, equivalent to 31% of total deposits.
Page 1 of 15
"Our robust performance for the 2008 second quarter contrasted sharply
with the difficulties faced by many financial institutions in today's economic
climate," stated Louis J. Cappelli, Sterling's Chairman and Chief Executive
Officer. "Earnings per share not only increased 15% compared to the second
quarter a year ago, but also rose sequentially from the first quarter of 2008.
The positive trend in our business through the first half of this year is
encouraging, and reinforces our belief that Sterling is well-positioned to
meet the challenges of the current market environment."
"We are pleased that credit quality has remained strong and compares
favorably to the overall banking industry," Mr. Cappelli added. "For example,
our ratio of non-accrual loans to total loans remains well below the peer
group average. We believe that our dedication to responsible, prudent lending
standards has enabled us to avoid many of the credit quality problems that are
making headlines today. It is worth noting that our loan portfolio reflects
limited exposure to construction lending, subprime and Alt-A mortgage loans,
consumer debt, home equity lending products, credit card receivables, auto
loans or other asset classes that have recently generated losses for some
institutions. We believe our traditional emphasis on conservative lending
practices will remain a source of strength and stability in a challenging
business environment."
"We believe in Sterling's potential for continued strong performance this
year. Our time-tested business model is based on serving solid businesses in
our market while maintaining conservative credit standards and a disciplined
approach to asset and liability pricing. We believe this model is
particularly well-suited to the present turbulent economic situation and will
continue to serve us well," Mr. Cappelli noted. "Customers have responded
favorably to our combination of financial strength, sound liquidity and
commitment to service. As a result, we have grown our average loans held in
portfolio nearly 7% for the first half of 2008 and are continuing to
experience an active pipeline. While some competing institutions have had to
withdraw from providing credit due to capital constraints, insufficient
liquidity or asset-quality issues, we believe Sterling has the capacity to
take advantage of opportunities presented by the current market disruption."
Second Quarter 2008 Financial Results
Net income was $4.2 million or $0.23 per diluted share for the 2008 second
quarter, an increase of 15% in EPS compared with $3.9 million or $0.20 per
diluted share for the second quarter of 2007.
Higher net interest income was the main driver of the earnings increase,
rising 18% to $21.6 million on a tax-equivalent basis for the second quarter
of 2008. Higher average loan and investment securities balances, as well as
the Company's strategy to employ cost-effective wholesale funding in lieu of
higher-priced certificates of deposit, contributed to the growth in net
interest income and more than offset the lower yields on loans due to the
current interest rate environment.
Page 2 of 15
Reflecting the above factors, the net interest margin rose to 4.49% for
the 2008 second quarter versus 4.35% for the same period last year.
Noninterest income for the second quarter of 2008 was $8.6 million,
compared to $8.9 million in the same period last year. Excluding an OTTI
charge for one investment grade trust preferred security, noninterest income
increased $164,000. The charge, which resulted from management's regular
review of the valuation of the investment portfolio, amounted to approximately
$507,000.
Noninterest expenses for the 2008 second quarter were $21.1 million,
compared to $20.1 million for the same quarter last year. The increase was
primarily due to initiatives to support the growth of the Company's business,
particularly in the area of marketing and advertising, along with higher
personnel and occupancy costs.
The provision for income taxes was $2.5 million and $2.2 million for the
second quarter of 2008 and 2007, respectively.
First Half 2008 Financial Results
Net income was $8.2 million or $0.45 per diluted share for the first half
of 2008, an EPS increase of 15% compared with $7.3 million or $0.39 per share
for the same period of 2007.
Net interest income was $41.6 million on a tax-equivalent basis for the
first half of 2008, up 16% from the same period of 2007. The increase
primarily reflected higher average balances of loans and investment securities
coupled with lower funding costs, which more than offset lower yields on
loans. The net interest margin was 4.49% for the first six months of 2008
compared with 4.34% for the same period last year.
Noninterest income was $17.2 million for the first half of 2008, compared
to $18.1 million in the same period last year. The decrease primarily
reflected the OTTI charge taken in the 2008 second quarter.
Noninterest expenses for the 2008 first half were $41.3 million, compared
to $39.7 million for the first half of last year. The increase was primarily
due to higher personnel and occupancy costs.
The provision for income taxes was $4.9 million for the first half of
2008, compared to $4.4 million in the year-ago period.
Earning Assets and Deposits
Sterling experienced solid demand for a wide range of its lending products
and services from both existing and new customers. As a result, average loans
held in portfolio, net of unearned discounts, increased 6.6% from a year ago,
to $1,121.9 million for the quarter ended June 30, 2008. The vast majority of
the Company's loans are secured by customer assets.
Page 3 of 15
Investment securities averaged $781.2 million for the second quarter of
2008, up from $554.6 million a year ago, primarily due to the implementation
of asset/liability management strategies designed to capitalize on current
market conditions. The Company's investment securities portfolio does not
contain any common stock, preferred shares or subordinated notes of Fannie Mae
or Freddie Mac.
Demand deposits averaged $444.7 million for the 2008 second quarter,
virtually even with $444.4 million a year earlier. Demand deposits
represented 31% of total deposits at June 30, 2008, one of the highest ratios
of demand to total deposits in the industry. The Company has no brokered
certificates of deposit.
Asset Quality Highlights
The ratio of nonperforming assets to total assets was 0.43% at June 30,
2008, compared to 0.42% at June 30, 2007. Nonperforming loans represented
0.58% of total loans at June 30, 2008, compared to 0.50% a year earlier. The
allowance for loan losses as a percentage of total loans held in portfolio was
1.30% at June 30, 2008, compared to 1.39% at June 30, 2007.
The adequacy of the provision and the resulting allowance for loan losses
is determined based on management's continuing evaluation of the loan
portfolio, including an assessment of current and expected future economic
conditions, the changing mix of loans in the portfolio, and other factors.
The provision for loan losses was $2.2 million for the second quarter of
2008, compared to the $2.0 million provision recorded in the first quarter of
2008. In the 2007 second quarter, the provision was $1.1 million.
Capital Management and Dividends
The Company's capital ratios exceeded the requirements for a
well-capitalized institution for regulatory purposes. Its Tier 1
risk-weighted capital ratio was 9.47% and its Tier 1 leverage ratio was 6.51%
at June 30, 2008.
"We believe we have ample capital to execute our business plan and support
our growth," Mr. Cappelli concluded.
Sterling paid a cash dividend of $0.19 per common share on June 30, 2008,
to shareholders of record as of June 15, 2008. The Company has been
distributing cash dividends for 250 consecutive quarters over more than 62
years.
Page 4 of 15
Conference Call
Sterling Bancorp will host a teleconference call for the financial
community on July 24, 2008 at 10:00 a.m. Eastern Time to discuss the 2008
second quarter financial results. The public is invited to listen to this
conference call by dialing 800-288-8968 at least 10 minutes prior to the call.
A replay of the conference call will be available beginning at
approximately 1:00 p.m. Eastern Time on July 24, 2008 until 11:59 p.m. Eastern
Time on August 7, 2008. To access the replay by telephone, interested parties
may dial 800-475-6701 and enter the access code 954381.
About Sterling Bancorp
Sterling Bancorp (NYSE: STL) is a New York-based banking and financial
services company that serves the needs of businesses, professionals and
individuals. With assets exceeding $2.1 billion, Sterling offers a broad
array of products and services, combined with a unique high-touch approach to
customer service. The Company's principal banking subsidiary, Sterling
National Bank, with offices in New York City and Queens, Nassau and
Westchester counties, was founded in 1929.
Known for its focus on business customers, Sterling offers such services
as working capital lines, asset-based financing, factoring and accounts
receivable management, payroll funding and processing, equipment leasing and
financing, commercial and residential mortgages, international trade
financing, cash management, a wide array of deposit products, trust and estate
administration, and investment management services.
Certain statements in this press release, including but not limited to,
statements as to future liquidity, future interest rate risk and operating
expenses, statements concerning future results of operations, financial
position or dividends, and plans and objectives for future operations,
statements concerning the Company's active loan pipeline and potential for
continued strong performance this year and the Company's belief that it is
well-positioned to meet the challenges of the current market environment, that
its traditional emphasis on conservative lending practices will remain a
source of strength and stability in a challenging business environment, that
its business model is particularly well-suited to the present turbulent
economic situation and will continue to serve the Company well, that it has
the capacity to take advantage of opportunities presented by the current
market disruption and that it has ample capital to execute on its business
plan and support its growth, and other statements regarding matters that are
not historical facts, are "forward-looking statements" as defined in the
Securities Exchange Act of 1934. These statements are not historical facts but
instead are subject to numerous assumptions, risks and uncertainties, and
represent only the Company's belief regarding future events, many of which, by
their nature, are inherently uncertain and outside its control. Any forward-
looking statements the Company may make speak only as of the date on which
such statements are made. The Company's actual results and financial position
may differ materially from the anticipated results and financial condition
indicated in or implied by these forward-looking statements. For a discussion
of some of the risks and important factors that could affect the Company's
future results and financial condition, see "Risk Factors" and "Management's
Discussion and Analysis of Financial Condition and Results of Operations -
Forward-Looking Statements and Factors that Could Affect Future Results" in
the Company's Annual Report on Form 10-K for the fiscal year ended December
31, 2007.
Page 5 of 15
STERLING BANCORP
Consolidated Financial Highlights
(Unaudited)
(dollars and shares in thousands, except per share data)
Three Months EndedSix Months Ended
June 30, June 30,
2008 20072008 2007
OPERATING HIGHLIGHTS(1)
Interest income$29,713 $29,928 $59,482 $59,035
Interest expense 8,241 11,720 18,175 23,324
Provision for loan losses2,2001,078 4,1502,328
Noninterest income 8,5728,915 17,244 18,098
Noninterest expenses21,130 20,094 41,296 39,732
Income from continuing operations,
before income taxes 6,7145,951 13,105 11,749
Provision for income taxes 2,5442,160 4,9334,386
Income from continuing operations4,1703,791 8,1727,363
Income/(Loss) from discontinued
operations, net of income taxes 0 71 0 (21)
Net income 4,1703,862 8,1727,342
Net income per average common share:
Basic 0.23 0.210.46 0.40
Diluted 0.23 0.200.45 0.39
Income from continuing operations
per average common share:
Basic 0.23 0.210.46 0.40
Diluted 0.23 0.200.45 0.39
Cash dividends declared 0.19 0.190.38 0.38
Common shares outstanding:
Period end 17,989 18,018 17,989 18,018
Average Basic 17,989 18,439 17,950 18,525
Average Diluted18,122 18,857 18,239 18,995
Return on average assets(2) 0.80%0.82% 0.80%0.80%
Return on average tangible equity(3) 17.14% 14.44% 16.84% 13.95%
Return on average stated equity (4) 13.89% 11.87% 13.64% 11.48%
Net interest spread, tax-equivalent
basis3.95%3.30% 3.87%3.29%
Net interest margin, tax-equivalent
basis4.49%4.35% 4.49%4.34%
(1) Unless otherwise indicated, all amounts and ratios are presented based
on continuing operations.
(2) Calculated by dividing income from continuing operations by average
assets from continuing operations.
(3) Average tangible equity represents average shareholders' equity less
average goodwill. Calculated by dividing income from continuing
operations by average tangible equity.
(4) Average stated equity is equal to average shareholders' equity.
Calculated by dividing income from continuing operations by average
stated equity.
Page 6 of 15
STERLING BANCORP
Consolidated Financial Highlights
(Unaudited)
(dollars in thousands, except per share data)
Three Months Ended Six Months Ended
June 30, June 30,
2008 20072008 2007
BALANCE SHEET HIGHLIGHTS(1)
Period End Balances
Investment securities$767,806 $532,307$767,806 $532,307
Loans held for sale24,410 46,357 24,410 46,357
Loans held in portfolio,
net of unearned discount 1,193,983 1,121,944 1,193,983 1,121,944
Total earning assets1,989,580 1,711,785 1,989,580 1,711,785
Allowance for loan losses 15,480 15,582 15,480 15,582
Total assets from continuing
operations 2,162,140 1,885,752 2,162,140 1,885,752
Total assets2,162,140 1,886,978 2,162,140 1,886,978
Demand deposits 492,928520,433 492,928520,433
Savings, NOW and money market
deposits 486,516476,879 486,516476,879
Time deposits 459,039536,516 459,039536,516
Customer repurchase
agreements64,758 76,530 64,758 76,530
Other short-term borrowings 261,090 29,162 261,090 29,162
Long-term borrowings 185,774 35,774 185,774 35,774
Shareholders' equity(2) 119,725121,913 119,725121,913
Average Balances
Investment securities$781,249 $554,643$750,868 $566,806
Loans held for sale31,193 52,281 27,291 45,790
Loans held in portfolio,
net of unearned discount 1,121,929 1,052,427 1,101,506 1,033,359
Total earning assets1,937,202 1,690,199 1,882,812 1,686,601
Total assets from continuing
operations 2,097,198 1,852,205 2,051,618 1,847,917
Total assets2,097,198 1,853,533 2,051,618 1,849,132
Demand deposits 444,744444,369 442,800439,609
Savings, NOW and money market
deposits 471,182487,966 468,027469,080
Time deposits 508,415562,417 529,903564,572
Customer repurchase
agreements89,187 76,091 85,824 85,517
Other short-term borrowings 180,870 30,843 157,355 30,298
Long-term borrowings 181,928 37,422 148,082 41,575
Shareholders' equity(2) 120,744128,150 120,512129,293
ASSET QUALITY HIGHLIGHTS(1)
Period End
Net charge-offs$1,611 $990 $3,109 $2,481
Nonperforming loans 7,051 5,854 7,051 5,854
Other real estate owned 2,252 2,057 2,252 2,057
Nonperforming assets9,303 7,911 9,303 7,911
Nonperforming loans/loans(3) 0.58% 0.50% 0.58% 0.50%
Nonperforming assets/assets 0.43% 0.42% 0.43% 0.42%
Allowance for loan
losses/loans (4)1.30% 1.39% 1.30% 1.39%
Allowance for loan losses/
nonperforming loans 219.54%266.18% 219.54%266.18%
Capital Ratios (2)
Tier 1 risk based9.47% 10.63% 9.47% 10.63%
Total risk based10.57% 11.84% 10.57% 11.84%
Leverage 6.51% 7.45% 6.51% 7.45%
Book value per common share(2) $6.66 $6.77 $6.66 $6.77
(1) Unless otherwise indicated, all amounts and ratios are presented based
on continuing operations.
(2) Includes the effects of discontinued operations.
(3) The term "loans" includes loans held for sale and loans held in
portfolio.
(4) The term "loans" includes loans held in portfolio only.
Page 7 of 15
STERLING BANCORP
Consolidated Balance Sheets
(Unaudited)
(in thousands, except number of shares)
June 30,
2008 2007
ASSETS
Cash and due from banks $49,995 $70,030
Interest-bearing deposits with other banks881 1,177
Federal Funds Sold 2,500 10,000
Investment securities
Available for sale (at estimated market
value) 434,700 145,900
Held to maturity (at amortized cost)333,106 386,407
Total investment securities 767,806 532,307
Loans held for sale24,410 46,357
Loans held in portfolio, net of unearned
discounts 1,193,983 1,121,944
Less allowance for loan losses 15,480 15,582
Loans held in portfolio, net1,178,503 1,106,362
Customers' liability under acceptances328 34
Goodwill 22,901 22,901
Premises and equipment, net10,869 11,510
Other real estate 2,252 2,057
Accrued interest receivable 9,877 4,894
Bank owned life insurance 29,603 28,488
Other assets 62,215 50,861
$2,162,140 $1,886,978
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits
Demand $492,928$520,433
Savings, NOW and money market 486,516 476,879
Time459,039 536,516
Total deposits 1,438,483 1,533,828
Securities sold under agreements to
repurchase - customers64,758 76,530
Securities sold under agreements to
repurchase - dealers 72,833 0
Federal funds purchased70,000 0
Commercial paper 20,544 27,444
Short-term borrowings - FHLB 77,000 0
Short-term borrowings - other 20,713 1,718
Long-term borrowings - FHLB 160,000 10,000
Long-term borrowings - subordinated
debentures25,774 25,774
Acceptances outstanding 328 34
Accrued expenses and other liabilities 91,982 89,737
Total liabilities 2,042,415 1,765,065
Shareholders' equity 119,725 121,913
$2,162,140 $1,886,978
MEMORANDA
Available for sale securities -
amortized cost $443,171$151,462
Held to maturity securities -
estimated market value 331,037 375,158
Shares outstanding
Common issued 21,813,131 21,262,170
Common in treasury 3,824,161 3,244,502
Page 8 of 15
STERLING BANCORP
Consolidated Statements of Income
(Unaudited)
(dollars in thousands, except per share data)
Three Months Ended Six Months Ended
June 30, June 30,
2008 2007 2008 2007
INTEREST INCOME
Loans $20,001 $23,124 $40,821 $44,851
Investment securities - available for
sale5,6701,701 10,3823,546
Investment securities - held to
maturity4,0344,6998,2599,568
Federal funds sold 1 36811,003
Deposits with other banks7 36 19 67
Total interest income 29,713 29,928 59,482 59,035
INTEREST EXPENSE
Savings, NOW and money market deposits 1,0893,2802,6996,139
Time deposits4,0346,5819,372 13,129
Securities sold u/a/r - customers 442 8051,0881,880
Securities sold u/a/r - dealers4160 7330
Federal funds purchased217 24 579 36
Commercial paper 117 355 312 705
Short-term borrowings - FHLB 3110 5260
Short-term borrowings - other6 15 20 27
Long-term borrowings - FHLB 1,085 1361,799 361
Long-term subordinated debentures 524 5241,0471,047
Total interest expense 8,241 11,720 18,175 23,324
Net interest income 21,472 18,208 41,307 35,711
Provision for loan losses2,2001,0784,1502,328
Net interest income after provision
for loan losses19,272 17,130 37,157 33,383
NONINTEREST INCOME
Accounts receivable management/
factoring commissions and other fees3,7993,8217,3647,489
Service charges on deposit accounts 1,3311,4242,6832,906
Other customer related service charges
and fees 737 7431,4121,433
Mortgage banking income 2,7022,5445,2015,376
Trust fees 124 125 259 266
Bank owned life insurance income 294 287 563 539
Loss on sale of OREO (75)(134)(303)(180)
Securities losses (507) (2)(507) (2)
Other income 167 107 572 271
Total noninterest income8,5728,915 17,244 18,098
NONINTEREST EXPENSES
Salaries 9,4918,711 18,839 17,920
Employee benefits2,2522,4755,0884,753
Total personnel expense11,743 11,186 23,927 22,673
Occupancy and equipment expenses, net2,7742,6395,7835,347
Advertising and marketing1,3531,1221,9882,086
Professional fees1,8741,9513,2383,291
Communications 405 454 861 970
Other expenses 2,9812,7425,4995,365
Total noninterest expenses 21,130 20,094 41,296 39,732
Income from continuing operations
before income taxes 6,7145,951 13,105 11,749
Provision for income taxes 2,5442,1604,9334,386
Income from continuing operations4,1703,7918,1727,363
Discontinued operations:
Income/(Loss), net of income taxes 0 710 (21)
Net income $4,170 $3,862 $8,172 $7,342
Page 9 of 15
STERLING BANCORP
Consolidated Statements of Income
(Unaudited)
(dollars in thousands, except per share data)
(continued)
Three Months Ended Six Months Ended
June 30,June 30,
200820072008 2007
Average number of common
shares outstanding
Basic 17,988,970 18,439,318 17,950,095 18,524,871
Diluted18,122,247 18,856,903 18,238,860 18,994,625
Income from continuing operations,
per average common share
Basic $0.23$0.21 $0.46 $0.40
Diluted 0.23 0.200.450.39
Net income per average common
share
Basic0.23 0.210.460.40
Diluted 0.23 0.200.450.39
Dividends per common share 0.19 0.190.380.38
Page 10 of 15
STERLING BANCORP
Consolidated Statements of Comprehensive (Loss)/Income
(Unaudited)
(in thousands)
Three Months Ended Six Months Ended
June 30,June 30,
2008 2007 2008 2007
Net income $4,170$3,862 $8,172 $7,342
Other comprehensive (loss)/income,
net of tax:
Unrealized holding losses arising
during the period (5,159) (1,233) (3,804) (897)
Reclassification adjustment for losses
included in net income 278 1 278 1
Amortization of:
Prior service cost 914 18 27
Net actuarial losses 230 182 461365
Comprehensive (loss)/income $(472) $2,826 $5,125 $6,838
STERLING BANCORP
Consolidated Statements of Changes in Shareholders' Equity
(Unaudited)
(in thousands)
Three Months Ended Six Months Ended
June 30,June 30,
2008 2007 2008 2007
Balance, at beginning of period$123,579 $133,017 $121,070 $132,263
Net income for period 4,170 3,862 8,172 7,342
Common shares issued under stock
incentive plan and related tax
benefits 3336 6,298 776
Cash dividends-Common shares (3,415) (3,451) (6,824) (6,993)
Surrender of shares issued under
incentive compensation plan 0 0(5,218) (456)
Purchase of common shares for treasury0 (10,515)0 (10,515)
Change in net unrealized holding
losses on available for sale
securities (5,159) (1,233) (3,804) (897)
Reclassification adjustment for
losses included in net income 278 1 278 1
Adjustment to retained earnings
upon adoption of EITF Issue 06-4
effective January 1, 2008 0 0 (726)0
Amortization of:
Prior service cost 9141827
Net actuarial losses 230 182 461 365
Balance, at end of period $119,725 $121,913 $119,725 $121,913
Page 11 of 15
STERLING BANCORP
Average Balance Sheets[1]
(Unaudited)
(dollars in thousands)
Three Months Ended
June 30, 2008 June 30, 2007
AVERAGE AVERAGE AVERAGE AVERAGE
BALANCE INTEREST RATE BALANCE INTEREST RATE
Assets
Interest-bearing
deposits with
other banks $2,474 $7 1.14%$2,881 $36 5.11%
Investment
securities -
available
for sale 417,409 5,462 5.23127,616 1,510 4.73
Investment
securities -
held to
maturity 341,662 4,034 4.72407,034 4,699 4.62
Investment
securities -
tax exempt [2] 22,178 340 6.13 19,993 314 6.30
Total
investment
securities 781,249 9,836 5.04554,643 6,523 4.71
Federal
funds sold 357 1 1.79 27,967 368 5.20
Loans, net of
unearned
discount [3] 1,153,122 20,001 7.16 1,104,708 23,124 8.66
Total
Interest-Earning
Assets [2] 1,937,202 29,845 6.26% 1,690,199 30,051 7.24%
Cash and due
from banks 47,695 63,451
Allowance for
loan losses(15,948) (16,320)
Goodwill 22,901 22,875
Other 105,348 92,000
Assets -
discontinued
operations 01,328
Total Assets $2,097,198 $1,853,533
Liabilities
and Shareholders' Equity
Interest-bearing
deposits
Domestic
Savings $19,735 17 0.36% $21,149 27 0.51%
NOW 256,316 542 0.85245,682 1,572 2.57
Money market195,131 530 1.09221,135 1,681 3.05
Time507,839 4,032 3.19561,843 6,579 4.70
Foreign
Time576 2 1.09574 2 1.09
Total
Interest-Bearing
Deposits 979,597 5,123 2.10 1,050,383 9,861 3.77
Borrowings
Securities sold u/a/r -
customers 89,187 442 1.99 76,091 805 4.24
Securities sold u/a/r -
dealers 66,527 416 2.52 0 0 0.00
Federal funds purchased 39,302 217 2.19 1,758 24 5.26
Commercial paper 19,547 117 2.42 27,906 355 5.11
Short-term borrowings -
FHLB53,758 311 2.32 0 0 0.00
Short-term borrowings -
other1,736 6 3.56 1,179 15 5.34
Long-term borrowings -
FHLB 156,154 1,085 2.78 11,648 136 4.69
Long-term borrowings -
sub debt25,774 524 8.37 25,774 524 8.38
Total
Borrowings 451,985 3,118 2.77144,356 1,859 5.19
Total
Interest-Bearing
Liabilities 1,431,582 8,241 2.31% 1,194,739 11,720 3.94%
Noninterest-bearing
demand deposits 444,744 444,369
Other liabilities 100,128 86,095
Liabilities -
discontinued operations0 180
Total
Liabilities1,976,4541,725,383
Shareholders' equity 120,744 128,150
Total Liabilities
and Shareholders'
Equity$2,097,198 $1,853,533
Net interest
income/spread [2] 21,604 3.95%18,331 3.30%
Net yield on
interest-earning
assets4.49% 4.35%
Less: Tax-equivalent
adjustment 132 123
Net interest income $21,472 $18,208
[1] The average balances of assets, liabilities and shareholders' equity
are computed on the basis of daily averages. Average rates are
presented on a tax-equivalent basis. Certain reclassifications have
been made to prior period amounts to conform to current presentation.
[2] Interest and/or average rates are presented on a tax-equivalent basis.
[3] Includes loans held for sale and loans held in portfolio; all loans
are domestic. Nonaccrual loans are included in amounts outstanding and
income has been included to the extent earned.
Page 12 of 15
STERLING BANCORP
Average Balance Sheets[1]
(Unaudited)
(dollars in thousands)
Six Months Ended
June 30, 2008 June 30, 2007
AVERAGE AVERAGE AVERAGE AVERAGE
BALANCE INTEREST RATE BALANCE INTEREST RATE
Assets
Interest-bearing
deposits with
other banks $2,968 19 1.26% 2,856 67 4.76%
Investment
securities -
available for
sale 381,222 9,996 5.24131,1053,1494.80
Investment
securities -
held to maturity 348,991 8,259 4.73415,0329,5684.61
Investment
securities -
tax exempt [2] 20,655 633 6.13 20,669 6536.37
Total investment
securities 750,868 18,888 5.03566,806 13,3704.72
Federal funds
sold 179 1 1.78 37,7901,0035.28
Loans, net of
unearned
discount[3] 1,128,797 40,821 7.55 1,079,149 44,8518.74
Total Interest-
Earning
Assets [2] 1,882,812 59,729 6.50% 1,686,601 59,2917.24
Cash and due
from banks 57,594 65,493
Allowance for
loan losses (15,759)(16,596)
Goodwill22,901 22,868
Other 104,070 89,551
Assets -
discontinued
operations 0 1,215
Total Assets $2,051,618 1,849,132
Liabilities and Shareholders' Equity
Interest-bearing
deposits
Domestic
Savings $19,192 33 0.35%21,026 520.50
NOW 246,514 1,368 1.12233,9162,9702.56
Money market202,321 1,298 1.29214,1383,1172.94
Time529,327 9,369 3.56563,998 13,1264.69
Foreign
Time576 3 1.0957431.09
Total Interest-
Bearing
Deposits 997,930 12,071 2.43 1,033,652 19,2683.76
Borrowings
Securities sold
u/a/r -
customers85,824 1,088 2.55 85,5171,8804.43
Securities sold
u/a/r -
dealers 51,277 733 2.88 000.00
Federal funds
purchased 44,129 579 2.60 1,354 365.25
Commercial paper 20,349 312 3.09 27,904 7055.10
Short-term
borrowings - FHLB 39,813 526 2.65 000.00
Short-term
borrowings -
other 1,787 20 4.56 1,040 275.34
Long-term
borrowings -
FHLB 122,308 1,799 2.94 15,801 3614.57
Long-term
borrowings -
sub debt 25,774 1,047 8.38 25,7741,0478.38
Total
Borrowings 391,261 6,104 3.13157,3904,0565.21
Total
Interest-Bearing
Liabilities 1,389,191 18,175 2.63% 1,191,042 23,3243.95
Noninterest-bearing
demand deposits442,800 439,609
Other liabilities99,115 88,880
Liabilities -
discontinued
operations 0 308
Total
Liabilities 1,931,106 1,719,839
Shareholders'
equity 120,512 129,293
Total
Liabilities
and
Shareholders'
Equity $2,051,618 1,849,132
Net interest income/
spread [2] 41,554 3.87% 35,967 3.29%
Net yield on
interest-earning
assets4.49% 4.34%
Less: Tax-equivalent
adjustment 247 256
Net interest income $41,307 $35,711
[1] The average balances of assets, liabilities and shareholders' equity
are computed on the basis of daily averages. Average rates are
presented on a tax-equivalent basis. Certain reclassifications have
been made to prior period amounts to conform to current presentation.
[2] Interest and/or average rates are presented on a tax-equivalent basis.
[3] Includes loans held for sale and loans held in portfolio; all loans
are domestic. Nonaccrual loans are included in amounts outstanding
and income has been included to the extent earned.
Page 13 of 15
STERLING BANCORP
Rate/Volume Analysis [1]
(Unaudited)
(in thousands)
Increase/(Decrease)
Three Months Ended
June 30, 2008
Volume Rate Net [2]
INTEREST INCOME
Interest-bearing deposits with
other banks $(4) $(25)$(29)
Investment securities - available
for sale 3,776 1763,952
Investment securities - held to
maturity (764) 99 (665)
Investment securities - tax exempt34(8) 26
Total investment securities 3,046 2673,313
Federal funds sold (220) (147)(367)
Loans, net of unearned discounts [3] 1,038(4,161) (3,123)
TOTAL INTEREST INCOME $3,860 $(4,066) $(206)
INTEREST EXPENSE
Interest-bearing deposits
Domestic
Savings$(2) $(8)$(10)
NOW 65(1,095) (1,030)
Money market (178) (973) (1,151)
Time (587) (1,960) (2,547)
Foreign
Time 0 00
Total interest-bearing deposits (702) (4,036) (4,738)
Borrowings
Securities sold under agreements to
repurchase - customers 120 (483)(363)
Securities sold under agreements to
repurchase - dealers 416 0 416
Federal funds purchased 213 (20) 193
Commercial paper(86) (152)(238)
Short-term borrowings - FHLB311 0 311
Short-term borrowings - other 1 (10) (9)
Long-term borrowings - FHLB 1,026 (77) 949
Long-term borrowings -
subordinated debentures 0 00
Total borrowings2,001 (742) 1,259
TOTAL INTEREST EXPENSE$1,299 $(4,778) $(3,479)
NET INTEREST INCOME $2,561 $712 $3,273
[1] This table is presented on a tax-equivalent basis.
[2] Changes in interest income and interest expense due to a combination
of both volume and rate have been allocated to the change due to
volume and the change due to rate in proportion to the relationship of
change due solely to each.
[3] Includes loans held for sale and loans held in portfolio; all loans
are domestic. Nonaccrual loans are included in amounts outstanding,
and income has been included to the extent earned.
Page 14 of 15
STERLING BANCORP
Rate/Volume Analysis [1]
(Unaudited)
(in thousands)
Increase/(Decrease)
Six Months Ended
June 30, 2008
Volume RateNet [2]
INTEREST INCOME
Interest-bearing deposits with
other banks $3 $(51)$(48)
Investment securities - available
for sale 6,534 3136,847
Investment securities - held to
maturity (1,544) 235 (1,309)
Investment securities - tax exempt 1 (21) (20)
Total investment securities 4,991 5275,518
Federal funds sold (598) (404) (1,002)
Loans, net of unearned discounts [3] 2,401(6,431) (4,030)
TOTAL INTEREST INCOME $6,797 $(6,359)$438
INTEREST EXPENSE
Interest-bearing deposits
Domestic
Savings$(5) $(14)$(19)
NOW168(1,770) (1,602)
Money market (146) (1,673) (1,819)
Time (703) (3,054) (3,757)
Foreign
Time 0 00
Total interest-bearing deposits (686) (6,511) (7,197)
Borrowings
Securities sold under agreements to
repurchase - customers 17 (809)(792)
Securities sold under agreements to
repurchase - dealers 733 0 733
Federal funds purchased 570 (27) 543
Commercial paper (157) (236)(393)
Short-term borrowings - FHLB526 0 526
Short-term borrowings - other 1(8) (7)
Long-term borrowings - FHLB 1,609 (171) 1,438
Long-term borrowings -
subordinated debentures 0 00
Total borrowings3,299(1,251) 2,048
TOTAL INTEREST EXPENSE$2,613 $(7,762) $(5,149)
NET INTEREST INCOME $4,184$1,403 $5,587
[1] This table is presented on a tax-equivalent basis.
[2] Changes in interest income and interest expense due to a combination
of both volume and rate have been allocated to the change due to
volume and the change due to rate in proportion to the relationship of
change due solely to each.
[3] Includes loans held for sale and loans held in portfolio; all loans
are domestic. Nonaccrual loans are included in amounts outstanding,
and income has been included to the extent earned.
Page 15 of 15
SOURCE Sterling Bancorp
