New York Community Bancorp, Inc. Reports 4th Quarter 2007 Diluted Cash Earnings Per Share of $0.25 and Diluted GAAP and Operating Earnings Per Share of $0.21

Business Wire, Jan 29, 2008

Charge-offs totaled $431,000 in the twelve months ended December 31, 2007, including $145,000 in the fourth quarter, as compared to $420,000 in the twelve months ended December 31, 2006. The 2007 charge-offs were more than offset by transaction-related additions to the allowance for loan losses, including the addition of a $4.9 million loan loss allowance in the October 1st acquisition of Synergy. At December 31, 2007, the allowance for loan losses totaled $92.8 million, signifying a $4.8 million increase on a linked-quarter basis and a $7.4 million increase from the balance recorded at December 31, 2006. The allowance for loan losses thus represented 0.46% of total loans at December 31, 2007 and 418.14% of non-performing loans at that date.

Securities

Securities represented $5.7 billion, or 18.8%, of total assets at December 31, 2007, as compared to $5.9 billion, or 19.6%, at September 30, 2007, and $4.9 billion, or 17.3%, at December 31, 2006. While the year-over-year increase was largely due to the Company's acquisitions, the linked-quarter decline was primarily due to repayments.

Available-for-sale securities represented $1.4 billion, or 24.0%, of total securities at December 31, 2007, a $95.4 million reduction from the September 30, 2007 balance and a $559.5 million reduction from the balance recorded at year-end 2006. In contrast, held-to-maturity securities represented $4.4 billion, or 76.0%, of total securities at the close of the current fourth quarter, signifying a three-month reduction of $57.8 million and a twelve-month increase of $1.4 billion, or 46.1%. The majority of the securities added to the portfolio in the past twelve months consisted of agency-backed mortgage obligations. There are no subprime or Alt-A issues in the securities portfolio.

Funding Sources

In addition to the cash flows generated through the repayment and sale of loans and securities, the Company's funding primarily stems from deposits and borrowed funds. Depending on the availability and attractiveness of alternative funding sources, the Company has typically opted not to vie for deposits when its competitors have priced their products at higher rates of interest, as was the case in the last twelve months. In addition, a portion of the cash flows produced through the sale of loans and securities acquired in its merger transactions was used to reduce the Company's higher-cost sources of funds in 2007, as in prior periods.

The deposits acquired in connection with the PennFed, Doral branch, and Synergy transactions enabled the Company to sit out the heated competition that ensued for deposits, particularly among the major money center banks and non-traditional financial services companies, during the year. Nonetheless, deposits rose $538.3 million, or 4.3%, from the year-earlier balance to $13.2 billion at December 31, 2007, the net effect of a $968.5 million increase in certificates of deposit ("CDs") to $6.9 billion and a $430.1 million reduction in core deposits (defined as NOW and money market accounts, savings accounts, and non-interest-bearing accounts) to $6.2 billion. While NOW and money market accounts fell $700.2 million over the course of the year to $2.5 billion, the decline was partly offset by a $120.0 million increase in savings accounts to $2.5 billion and a $150.1 million increase in non-interest-bearing deposits to $1.3 billion. On a linked-quarter basis, deposits declined $410.2 million, reflecting the planned reduction of higher-cost funds.