Market Overview

Sterling Bancorp Net Income Exceeds $5.3 Million in 2012 Third Quarter, Increasing 22% Year-Over-Year

Share:

Advancing Trends in ROA, ROE and Asset Quality

Record Levels of Loans and Deposits

NEW YORK, Nov. 2, 2012 /PRNewswire/ -- 

Strong Financial Performance

  • Net income available to common shareholders exceeded $5.3 million, more than 22% higher than a year ago.
  • Diluted earnings per common share were $0.17, up from $0.14.
  • Net interest margin increased 12 basis points to 4.02%.
  • Return on average tangible equity advanced to 10.32%.

Robust Loan and Deposit Growth

  • Loans, net of unearned discount approach $1.7 billion, rising 13%.
  • Total deposits up 9% to over $2.2 billion; demand deposits represent 37% of total deposits.

Solid Credit Metrics

  • Net charge-offs decreased to $0.9 million or 0.05% of loans.
  • Ratio of nonperforming assets to total assets decreased to 0.26%.
  • Allowance for loan losses as a percentage of loans held in portfolio was 1.36%.

Comparisons above are at or for the quarters ended September 30, 2012 vs. September 30, 2011.

Sterling Bancorp (NYSE: STL) today reported net income available to common shareholders of $5.3 million for the 2012 third quarter, an increase of 22% from $4.4 million in the 2011 third quarter. Diluted earnings per common share were $0.17 for the 2012 third quarter, up from $0.14 in the year-ago period.

For the first nine months of 2012, net income available to common shareholders rose 45% to $14.8 million, up from $10.2 million in the same period of 2011. Diluted earnings per common share were $0.48 for the first nine months of 2012, up from $0.35 in the year-ago period. Results for the 2011 nine months included dividends on preferred shares and accretion of $2.1 million related to TARP preferred shares and warrants to purchase common shares, which were redeemed in April 2011.

Selected Quarterly Financial Highlights

 



         Quarter Ended         



9/30/12

9/30/11

EARNINGS HIGHLIGHTS





Net income available to common shareholders (in millions)

$5.3

$4.4

Diluted earnings per common share

$0.17

$0.14

Return on average assets

0.82%

0.67%

Return on average tangible equity

10.32%

8.82%







BALANCE SHEET HIGHLIGHTS (in millions)



Total investment securities

$699.8

$800.2

Loans, net of unearned discount

$1,677.0

$1,486.0

Demand deposits

$831.3

$594.3

Total deposits

$2,225.4

$2,047.8

Total assets

$2,699.7

$2,657.0







ASSET QUALITY HIGHLIGHTS





Nonaccrual loans/loans

0.32%

0.38%

Nonperforming assets/assets

0.26%

0.28%

Allowance for loan losses/nonaccrual loans

407.47%

347.38%

Profitable Growth Drives Strong Performance Trends

"Sterling's financial performance has gained greater strength and momentum with each quarter of 2012," said Louis J. Cappelli, Sterling's Chairman and Chief Executive Officer.  "We have focused on growing our core banking operations, specializing in the needs of small and mid-sized businesses, while also enhancing profitability and managing expenses and asset quality. This has produced favorable trends in many areas, including record loans and deposits, continued double-digit earnings growth and higher returns on average assets and average tangible equity."

"Our growth and higher profits are being driven by a number of positive factors," Mr. Cappelli continued. "It is our belief that we are well positioned to benefit from the healthy demand for financial services in the New York City-metropolitan market and beyond, due to our emphasis on the needs of business customers, our tradition of exceptional service and our portfolio of financial solutions.  We have pursued a strategy to redeploy assets from our sizeable liquid investment portfolio into loans, which led to a 5% increase in net interest income and a 12-basis point improvement in the net interest margin compared with last year's third quarter.  The Company also has multiple channels of deposit growth, including dedicated business units that have successfully focused on core deposit sources, as well as deposit balances associated with our lending relationships. We have maintained disciplined management of operating expenses, while our sound asset quality metrics have strengthened even further."

"At a time when the prevailing low interest rate environment has pressured earnings at some banking institutions, Sterling has benefitted from strategies that have led to a growing net interest margin and strong level of noninterest income," Mr. Cappelli noted.  "Our net interest margin is in the top third among banks of our asset size, reflecting our ability to redeploy assets from the investment portfolio into loans, a disciplined approach to deposit pricing, and growth in noninterest-bearing demand deposits.  We also have built a diversified revenue base, with a relatively high level of noninterest income that provided over 28% of total revenues this quarter.  Overall, our efforts to generate a mix of net interest income and noninterest income have produced a balanced revenue base and contributed to our growing profitability."                       

"The Company continues to demonstrate forward momentum on a sequential basis, with a 5% increase in loans, 9% higher deposits and a 64-basis point rise in return on average tangible equity from the second to the third quarter this year.  We believe Sterling's performance during the remainder of 2012 and beyond should continue to benefit from several strong drivers of growth and profitability. Going forward, we expect to maintain our trend of rising loan volume, along with a balanced revenue mix, a focus on managing expenses, and stringent asset quality standards," Mr. Cappelli concluded.

Net Interest Income

Net interest income was $23.8 million for the 2012 third quarter, up 5% from $22.6 million for the 2011 third quarter.  This primarily reflected the Company's execution of its strategy to shift the asset mix toward higher loan balances and lower investment securities balances, with a resulting increase in yields, while also taking a disciplined approach to reducing funding costs.  Net interest margin increased to 4.02% for the 2012 third quarter, up 12 basis points compared to the year-ago period.  For the first nine months of 2012, net interest income increased more than 8% to $69.1 million, from $63.9 million for the 2011 period. 

Noninterest Income

Total noninterest income was $10.5 million for the 2012 third quarter, compared to $10.7 million in the 2011 third quarter.  This primarily reflected lower accounts receivable management and other related fees and reduced securities gains, which were partly offset by higher mortgage banking income.  For the first nine months of 2012, total noninterest income was $31.6 million, versus $32.1 million in the year-ago period. Noninterest income was a key contributor to Sterling's financial performance, representing between 28-29% of total revenue in both the third quarter and first nine months of 2012.

Noninterest Expenses         

Noninterest expenses were $24.5 million for the 2012 third quarter, an increase of only 3% compared with the 2011 third quarter.  For the first nine months of 2012, noninterest expenses were $71.5 million, an increase of less than 3% from the same period of 2011.

Record Loans and Deposits

Loans, net of unearned discount set a record, approaching $1.7 billion at September 30, 2012, an increase of approximately 13% from a year earlier.  The ratio of loans to deposits was more than 75% at September 30, 2012.

Total deposits were a record $2.2 billion at September 30, 2012, increasing nearly 9% from a year earlier. Noninterest-bearing demand deposits represented over 37% of total deposits, among the highest ratios of demand to total deposits in the industry. 

Asset Quality

Sterling continued to exhibit strong credit quality metrics during the 2012 third quarter.  Net charge-offs were $0.9 million for the 2012 third quarter, compared to $2.0 million a year ago. The allowance for loan losses as a percentage of nonaccrual loans was 407% at September 30, 2012, versus 347% a year earlier. Nonperforming assets were $7.0 million or 0.26% of total assets at September 30, 2012, compared to $7.6 million or 0.28% a year ago.  The allowance for loan losses as a percentage of portfolio loans was 1.36% at September 30, 2012, compared to 1.34% a year earlier.  The provision for loan losses decreased to $2.0 million from $3.0 million for the same quarter of 2011. 

Capital

The Company's capital base has continued to exceed all regulatory requirements for well-capitalized institutions.  At September 30, 2012, Sterling's Tier 1 risk-based capital ratio was 11.69% (compared to a requirement of 6.00%), total risk-based capital was 12.82% (requirement of 10.00%), and the Tier 1 leverage ratio was 9.38% (requirement of 5.00%).  The tangible common equity ratio was 7.84% at September 30, 2012.

Conference Call

Sterling Bancorp will host a teleconference call for the financial community on Friday, November 2, 2012, at 10:00 a.m. Eastern Time to discuss these financial results.  To access the conference call live, interested parties may dial 866-233-3843 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 November 2, 2012, until 11:59 p.m. Eastern Time on November 16, 2012.  To access the replay by telephone, interested parties may dial 800-475-6701 and enter the Access Code 267654.

About Sterling Bancorp

Sterling Bancorp (NYSE: STL) is a New York City-based financial corporation with assets of $2.7 billion. Since 1929, Sterling National Bank, the Company's principal banking subsidiary, has successfully served the needs of businesses, professionals and individuals in the NY metropolitan area and beyond. Sterling is well-known for its high-touch, hands-on approach to customer service and a special focus on serving the business community.

Sterling provides clients with a full range of depository and cash management services and a broad portfolio of financing solutions—including working capital lines, accounts receivable and inventory financing, factoring, trade financing, payroll funding and processing, equipment financing, commercial and residential mortgages and mortgage warehouse lines of credit.

Certain statements in this press release, including but not limited to, statements as to future events, 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, future capital, future liquidity and future growth, statements concerning the economic environment, asset quality and future levels of nonaccrual loans, charge-offs and provisions for loan losses, and our ability to continue growing our core banking operations, to specialize in the needs of small and mid-sized businesses, to enhance profitability and to manage expenses and asset quality, our position to benefit from the demand for financial services in the New York City-metropolitan market and beyond, our ability to redeploy assets from investment portfolio to loans and to produce improvements in our net interest margin from such strategy, our ability to utilize channels of deposit growth and our ability to maintain our revenue generation capacity and disciplined management of operating expenses, whether our performance during the remainder of 2012 and beyond will continue to be strong and whether our trend of rising loan volume, along with a balanced revenue mix, a focus on managing expenses and stringent asset quality standards will persist, and other statements contained herein 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, and the Company makes no commitment to update or revise forward-looking statements to reflect new information or subsequent events or changes in expectations. 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 our Annual Report on Form 10-K for the fiscal year ended December 31, 2011.

STERLING BANCORP

Consolidated Financial Highlights

(Unaudited)

(dollars in thousands, except per share data)























Three Months Ended September 30, 



Nine Months Ended September 30, 





2012



2011



2012



2011

BALANCE SHEET HIGHLIGHTS 

















Period End Balances

















   Investment securities



$699,801



$800,233



$699,801



$800,233

   Loans held for sale



51,551



22,874



51,551



22,874

   Loans held in portfolio, 

















      net of unearned discount



1,625,415



1,463,171



1,625,415



1,463,171

   Interest bearing deposits with other banks



149,592



186,632



149,592



186,632

   Total earning assets



2,533,837



2,481,412



2,533,837



2,481,412

   Allowance for loan losses



22,154



19,547



22,154



19,547

   Total assets



2,699,725



2,656,975



2,699,725



2,656,975



















   Demand deposits



831,281



594,250



831,281



594,250

   Savings, NOW and money market deposits



667,517



607,049



667,517



607,049

   Time deposits



726,556



846,496



726,556



846,496

   Customer repurchase agreements



37,314



43,503



37,314



43,503

   Advances FHLB/Long-term borrowings



127,408



148,869



127,408



148,869

   Shareholders' equity 



233,436



218,685



233,436



218,685



















Average Balances

















   Investment securities



735,101



887,971



767,828



884,415

   Loans held for sale



44,690



28,344



37,711



25,881

   Loans held in portfolio, 

















      net of unearned discount



1,588,251



1,425,685



1,492,667



1,319,054

   Interest bearing deposits with other banks



56,700



66,961



56,586



53,070

   Total earning assets



2,432,475



2,417,675



2,362,995



2,291,282

   Total assets



2,603,326



2,596,845



2,532,531



2,464,512



















   Demand deposits



755,447



582,042



760,503



558,059

   Savings, NOW and money market deposits



657,421



618,840



642,219



590,722

   Time deposits



692,399



798,705



630,789



708,919

   Customer repurchase agreements



36,307



40,340



39,399



42,096

   Advances FHLB/Long-term borrowings



133,081



153,556



143,064



157,590

   Shareholders' equity  



229,312



219,470



225,524



226,873



















ASSET QUALITY HIGHLIGHTS 

















Period End

















   Net charge-offs



$866



$1,968



$5,447



$7,666

   Nonaccrual loans



5,437



5,627



5,437



5,627

   Other real estate owned



1,595



1,929



1,595



1,929

   Nonperforming assets



7,032



7,556



7,032



7,556

   Nonaccrual loans/loans (1)



0.32%



0.38%



0.32%



0.38%

   Nonperforming assets/assets



0.26%



0.28%



0.26%



0.28%

   Allowance for loan losses/loans (2)



1.36%



1.34%



1.36%



1.34%

   Allowance for loan losses/nonaccrual loans



407.47%



347.38%



407.47%



347.38%



















CAPITAL RATIOS

















Period End

















   Tier 1 risk based



11.69%



12.13%



11.69%



12.13%

   Total risk based



12.82%



13.16%



12.82%



13.16%

   Leverage



9.38%



9.08%



9.38%



9.08%

   Equity/ assets



8.65%



8.23%



8.65%



8.23%

   Tangible common equity



7.84%



7.43%



7.84%



7.43%

   Book value per common share



$7.54



$7.07



$7.54



$7.07



















Return on average equity



9.27%



7.90%



8.78%



7.22%

Return on average tangible equity



10.32%



8.82%



9.78%



8.04%



















(1) The term "loans" includes loans held for sale and loans held in portfolio.



(2) The term "loans" includes loans held in portfolio only.

















Page 6 of 15





STERLING BANCORP

Consolidated Balance Sheets

(Unaudited)

(dollars in thousands, except number of shares)































September 30, 













2012



2011

ASSETS

















Cash and due from banks









$

33,872

$

32,418

Interest-bearing deposits with other banks











149,592



186,632



















Investment securities

















    Available for sale (at estimated fair value)











310,022



346,508

    Held to maturity (at amortized cost)











389,779



453,725

            Total investment securities











699,801



800,233



















Loans held for sale











51,551



22,874

Loans held in portfolio, net of unearned discounts











1,625,415



1,463,171

Less allowance for loan losses











22,154



19,547

            Loans held in portfolio, net











1,603,261



1,443,624

Federal Reserve Bank and Federal Home Loan Bank stock, at cost







7,478



8,502

Customers' liability under acceptances











33



122

Goodwill











22,901



22,901

Premises and equipment, net











23,154



24,163

Other real estate











1,595



1,929

Accrued interest receivable











8,474



8,779

Cash surrender value of  life insurance policies











54,144



53,000

Other assets











43,869



51,798











$

2,699,725

$

2,656,975



















LIABILITIES AND SHAREHOLDERS' EQUITY

















Deposits

















    Demand









$

831,281

$

594,250

    Savings, NOW and money market











667,517



607,049

    Time











726,556



846,496

            Total deposits











2,225,354



2,047,795



















Securities sold under agreements to repurchase - customers







37,314



43,503

Securities sold under agreements to repurchase - dealers







-



5,000

Short-term borrowings - other











12,545



17,726

Advances - FHLB











101,634



123,095

Long-term borrowings - subordinated debentures











25,774



25,774

Acceptances outstanding











33



122

Accrued interest payable











701



1,081

Due to factored clients











-



94,141

Accrued expenses and other liabilities











62,934



80,053

            Total liabilities











2,466,289



2,438,290



















Shareholders' equity











233,436



218,685











$

2,699,725

$

2,656,975

MEMORANDA

















    Available for sale securities - amortized cost









$

304,687

$

349,996

    Held to maturity securities - estimated fair value









408,472



468,614

    Shares outstanding

















        Common issued











35,263,768



35,225,110

        Common in treasury











4,307,972



4,300,278























































NOTE: Certain reclassifications have been made to prior period's financial data to conform to current financial statement presentations.



Page 7 of 15

 


STERLING BANCORP

Consolidated Statements of Income

(Unaudited)

(dollars in thousands, except per share data)























Three Months Ended September 30, 



Nine Months Ended September 30, 





2012



2011



2012



2011

INTEREST INCOME

















Loans

$

21,494

$

19,721

$

61,224

$

55,006

Investment securities - available for sale



2,206



2,742



7,226



8,120

Investment securities - held to maturity



2,710



3,351



8,584



10,230

FRB and FHLB stock



67



75



282



241

Deposits with other banks



33



35



97



92

            Total interest income



26,510



25,924



77,413



73,689



















INTEREST EXPENSE

















Savings, NOW and money market deposits



629



752



1,931



2,152

Time deposits



1,053



1,470



3,128



4,212

Securities sold u/a/r - customers



33



45



107



145

Securities sold u/a/r - dealers



-



16



31



49

Short-term borrowings - other



23



18



51



50

Advances - FHLB



457



483



1,494



1,647

Long-term subordinated debentures



523



523



1,570



1,570

            Total interest expense



2,718



3,307



8,312



9,825



















Net interest income



23,792



22,617



69,101



63,864

Provision for loan losses



2,000



3,000



7,750



9,000

Net interest income after provision for loan losses



21,792



19,617



61,351



54,864



















NONINTEREST INCOME

















Accounts receivable management/

















    factoring commissions and other fees



5,251



5,974



15,184



16,811

Service charges on deposit accounts



1,444



1,445



4,472



4,248

Trade finance income



495



607



1,462



1,735

Other customer related service charges and fees



210



287



715



708

Mortgage banking income



2,569



1,493



7,298



5,268

Income from life insurance policies



247



288



1,039



860

Securities gains



282



605



1,490



2,234

Loss on sale of OREO



(9)



(5)



(75)



-

Other income



25



20



51



259

            Total noninterest income



10,514



10,714



31,636



32,123



















NONINTEREST EXPENSES

















Salaries



11,401



11,037



33,756



32,708

Employee benefits



3,627



3,396



11,078



10,450

    Total personnel expense



15,028



14,433



44,834



43,158

Occupancy and equipment expenses, net



3,429



3,069



10,045



9,857

Advertising and marketing



774



781



2,192



2,079

Professional fees



1,083



1,741



3,494



3,448

Communications



576



430



1,508



1,314

Deposit insurance



544



374



1,668



2,204

Other expenses



3,050



2,942



7,774



7,609

            Total noninterest expenses



24,484



23,770



71,515



69,669



















Income before income taxes



7,822



6,561



21,472



17,318

Provision for income taxes 



2,481



2,191



6,656



5,060

Net income



5,341



4,370



14,816



12,258

Dividends on preferred shares and accretion



-



-



-



2,074

Net income available to 

















    common shareholders

$

5,341

$

4,370

$

14,816

$

10,184



















Page 8 of 15



 

STERLING BANCORP

Consolidated Statements of Income

(Unaudited)

(dollars in thousands, except per share data)























(continued)















































Three Months Ended September 30, 



Nine Months Ended September 30, 





2012



2011



2012



2011

Average number of common shares outstanding

















        Basic



30,844,341



30,789,539



30,818,531



29,375,816

        Diluted



30,844,341



30,789,539



30,818,531



29,375,816





































Net income available to common 

















    shareholders per average 
    common share

















        Basic

$

0.17

$

0.14

$

0.48

$

0.35

        Diluted



0.17



0.14



0.48



0.35





































Dividends per common share



0.09



0.09



0.27



0.27





































Page 9 of 15

 

STERLING BANCORP

Consolidated Statements of Comprehensive Income 

(Unaudited)      

(dollars in thousands)









































Three Months Ended September 30, 



Nine Months Ended September 30, 





2012



2011



2012



2011



















Net income

$

5,341

$

4,370

$

14,816

$

12,258



















Other comprehensive income, net of tax:

















    Unrealized holding gains  

      (losses) on securities

















       arising during the period



2,392



(2,465)



4,739



(873)



















    Reclassification adjustment 

     for securities gains included

















      in net income



(156)



(330)



(827)



(1,220)

    Amortization of:

















        Prior service cost



4



9



16



26

        Net actuarial losses



627



487



1,644



1,266



















Comprehensive income

$

8,208

$

2,071

$

20,388

$

11,457









































































STERLING BANCORP

Consolidated Statements of Changes in Shareholders' Equity

(Unaudited)

(dollars in thousands)























Three Months Ended September 30, 



Nine Months Ended September 30, 





2012



2011



2012



2011

Balance, at beginning of period

$

227,551

$

219,256

$

220,821

$

222,742

Net income for period



5,341



4,370



14,816



12,258

Common shares issued



-



-



-



36,454

Issuance of common shares for acquisitions



375



-



375



-

Stock option and restricted stock 

















   compensation expense



86



141



275



287

Preferred shares redeemed in connection with

















    the TARP Capital Purchase Program



-



-



-



(42,000)

Repurchase of warrant



-



-



-



(945)

Cash dividends - common shares



(2,784)



(2,783)



(8,348)



(8,341)

Cash dividends - preferred shares



-



-



-



(945)

Surrender of shares issued under

















    incentive compensation plan



-



-



(75)



(24)

Unrealized holding gains (losses) on

















    securities arising during the period



2,392



(2,465)



4,739



(873)

Reclassification adjustment for securities

















    gains included in net income



(156)



(330)



(827)



(1,220)

Amortization of:

















    Prior service cost



4



9



16



26

    Net actuarial losses



627



487



1,644



1,266



















Balance, at end of period

$

233,436

$

218,685

$

233,436

$

218,685



















Page 10 of 15





 STERLING BANCORP

















 Average Balance Sheets [1]

















 (Unaudited)

















 (dollars in thousands)
























































Three Months Ended















September 30, 2012





September 30, 2011







AVERAGE







AVERAGE





AVERAGE







AVERAGE







BALANCE



INTEREST



RATE





BALANCE



INTEREST



RATE



Assets





























  Interest-bearing deposits with other banks

$

56,700

$

33



0.23

%

$

66,961

$

35



0.21

%































  Investment Securities





























    Available for sale - taxable



338,556



2,037



2.40





391,920



2,509



2.56



    Held to maturity - taxable



243,021



1,319



2.17





337,634



1,978



2.34



    Tax-exempt [2]



153,524



2,400



6.25





158,417



2,471



6.24



      Total investment securities



735,101



5,756



3.13





887,971



6,958



3.13



  FRB and FHLB stock  [2]



7,733



67



3.48





8,714



75



3.44

































  Loans, net of unearned discount  [3]



1,632,941



21,494



5.26





1,454,029



19,721



5.54

































Total Interest-Earning Assets [2]



2,432,475



27,350



4.47

%



2,417,675



26,789



4.47

%































  Cash and due from banks



37,218













38,558











  Allowance for loan losses



(22,796)













(19,798)











  Goodwill



22,901













22,901











  Other



133,528













137,509











Total Assets

$

2,603,326











$

2,596,845









































Liabilities and Shareholders' Equity





























  Interest-bearing deposits





























    Domestic





























      Savings

$

22,554



1



0.01

%

$

17,497



2



0.05

%

      NOW



217,675



55



0.10





223,566



117



0.21



      Money market



417,192



573



0.55





377,777



633



0.67



      Time



692,399



1,053



0.61





798,705



1,470



0.73



Total Interest-Bearing Deposits



1,349,820



1,682



0.50





1,417,545



2,222



0.62



  Borrowings





























    Securities sold u/a/r - customers



36,307



33



0.37





40,340



45



0.44



    Securities sold u/a/r - dealers



-



-



-





5,002



16



1.30



    Federal funds purchased



22,500



13



0.23





13,912



5



0.13



    Commercial paper



13,252



10



0.29





14,521



11



0.29



    Short-term borrowings - other



-



-



-





4,195



2



0.10



    Advances - FHLB



107,307



457



1.69





127,782



483



1.50



    Long-term borrowings - sub debt



25,774



523



8.38





25,774



523



8.38



Total Borrowings



205,140



1,036



2.02





231,526



1,085



1.87

































Total Interest-Bearing Liabilities



1,554,960



2,718



0.70

%



1,649,071



3,307



0.80

%

Noninterest-bearing demand deposits



755,447













582,042











  Total including noninterest-bearing





























   demand deposits



2,310,407



2,718



0.48

%



2,231,113



3,307



0.59

%

Other liabilities



63,607













146,262









































Total Liabilities



2,374,014













2,377,375









































Shareholders' equity



229,312













219,470









































Total Liabilities and Shareholders' Equity

$

2,603,326











$

2,596,845









































Net interest income/spread [2]







24,632



3.77

%







23,482



3.67

%































Net yield on interest-earning assets [2]











4.02

%











3.90

%































Less: Tax-equivalent adjustment







840













865





































Net interest income





$

23,792











$

22,617



































































[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 11 of 15







 





 STERLING BANCORP

















 Average Balance Sheets [1]

















 (Unaudited)

















 (dollars in thousands)
























































Nine Months Ended















September 30, 2012





September 30, 2011







AVERAGE







AVERAGE





AVERAGE







AVERAGE







BALANCE



INTEREST



RATE





BALANCE



INTEREST



RATE



Assets





























  Interest-bearing deposits with other banks

$

56,586

$

97



0.23

%

$

53,070

$

92



0.23

%































  Investment Securities





























    Available for sale - taxable



354,492



6,673



2.51





393,561



7,255



2.46



    Held to maturity - taxable



257,642



4,393



2.27





333,710



6,335



2.53



    Tax-exempt [2]



155,694



7,298



6.25





157,144



7,323



6.21



      Total investment securities



767,828



18,364



3.19





884,415



20,913



3.15



  FRB and FHLB stock  [2]



8,203



284



4.61





8,862



243



3.66

































  Loans, net of unearned discount  [3]



1,530,378



61,224



5.52





1,344,935



55,006



5.72

































Total Interest-Earning Assets [2]



2,362,995



79,969



4.61

%



2,291,282



76,254



4.55

%































  Cash and due from banks



37,157













37,998











  Allowance for loan losses



(22,022)













(19,648)











  Goodwill



22,901













22,901











  Other



131,500













131,979











Total Assets

$

2,532,531











$

2,464,512









































Liabilities and Shareholders' Equity





























  Interest-bearing deposits





























    Domestic





























      Savings

$

20,784



3



0.02

%

$

18,450



7



0.05

%

      NOW



217,280



198



0.12





212,857



289



0.18



      Money market



404,155



1,730



0.57





359,415



1,856



0.69



      Time



630,789



3,128



0.66





708,919



4,212



0.79



Total Interest-Bearing Deposits



1,273,008



5,059



0.53





1,299,641



6,364



0.65



  Borrowings





























    Securities sold u/a/r - customers



39,399



107



0.36





42,096



145



0.46



    Securities sold u/a/r - dealers



3,522



31



1.16





5,249



49



1.24



    Federal funds purchased



12,226



20



0.21





14,608



14



0.13



    Commercial paper



14,375



31



0.29





14,762



33



0.30



    Short-term borrowings - other



-



-



-





3,794



3



0.08



    Advances - FHLB



117,290



1,494



1.70





131,816



1,647



1.67



    Long-term borrowings - sub debt



25,774



1,570



8.38





25,774



1,570



8.38



Total Borrowings



212,586



3,253



2.05





238,099



3,461



1.95

































Total Interest-Bearing Liabilities



1,485,594



8,312



0.75

%



1,537,740



9,825



0.85

%

Noninterest-bearing demand deposits



760,503













558,059











  Total including noninterest-bearing





























   demand deposits



2,246,097



8,312



0.51

%



2,095,799



9,825



0.63

%

Other liabilities



60,910













141,840









































Total Liabilities



2,307,007













2,237,639









































Shareholders' equity



225,524













226,873









































Total Liabilities and Shareholders' Equity

$

2,532,531











$

2,464,512









































Net interest income/spread [2]







71,657



3.86

%







66,429



3.70

%































Net yield on interest-earning assets [2]











4.12

%











3.96

%































Less: Tax-equivalent adjustment







2,556













2,565





































Net interest income





$

69,101











$

63,864



































































[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

Rate/Volume Analysis  [1]

(Unaudited)

(dollars in thousands)



























Increase/(Decrease)









Three Months Ended









September 30, 2012



























Volume



Rate



Net  [2]

INTEREST INCOME

















Interest-bearing deposits with other banks





$

(5)

$

3

$

(2)



















Investment Securities

















  Available for sale - taxable







(323)



(149)



(472)

  Held to maturity - taxable







(523)



(136)



(659)

  Tax-exempt 







(75)



4



(71)

      Total investment securities







(921)



(281)



(1,202)



















FRB and FHLB stock







(9)



1



(8)



















Loans, net of unearned discounts [3]







2,711



(938)



1,773

TOTAL INTEREST INCOME





$

1,776

$

(1,215)

$

561





































INTEREST EXPENSE