State tax law changes and higher net interest income helped boost net income at Astoria Financial Corp. by 112 percent in the first quarter compared to a year earlier.
Astoria is the holding company for the 85-branch Astoria Federal Savings and Loan Association.
Net income available to common shareholders was $29.4 million in the three months ended March 31 -- $31.5 million with preferred stock dividends included. Earning per share were 30 cents, compared with 14 cents a share a year earlier.
Astoria said state tax changes accounted for $11.5 million, or 12 cents per share, of the increase. The state tax reduction results from legislation signed in connection with the state's 2014-2015 budget. It affects the calculation of income taxes imposed on banks and thrifts operating in the state, Astoria said.
Astoria's total assets slipped by 4 percent to $15.7 billion, mostly from a decrease in residential one- to four-family mortgage loans.
Net interest income, the difference between the revenue generated from a bank's assets and the expenses associated with liabilities, rose by 5 percent to $87.9 million, although noninterest income fell by 25 percent to $13.7 million.
Net interest margin, a measure of the difference between the interest a bank earns on its assets such as loans, and the interest it pays out to depositors, rose from 2.19 percent to 2.36 percent from last year's first quarter. The 2014 first quarter included a large prepayment penalty on a group of loans to a single borrower which added about 2 basis points.
The bank's provision for loan losses was $1.6 million for the quarter ended March 31, down from $3.4 million, which president and chief executive Monte N. Redman termed "appropriate given the continued improvement in our asset quality metrics as well as the high quality of our loan originations."