2 LI banks report drop in earnings

Westbury-based New York Community Bancorp said Wednesday that its first-quarter earnings fell by almost 4 percent from a year earlier on lower loan interest rates.

And Astoria Financial Corp., parent of Astoria Federal Savings and Loan Association, reported a 63 percent decline in earnings, citing employee severance expenses as it tried to cut costs. The Lake Sucess-based bank did report growth in its loan portfolio for a change.

Bank earnings usually reflect the health of the local economy, especially the housing sector, as well as the national interest rate environment.

New York Community said net income was $118.2 million, or 27 cents per share, compared with $123.1 million, or 28 cents a share in the same quarter last year.

It said net outstanding loans rose by $385.5 million from a year earlier, to $30.5 billion as of March 31 of this year. But it said interest income produced by loans fell $16.1 million to $398.2 million.

Mortgage banking activity generated income of $35.2 million in the quarter, up by 76.4 percent from a year earlier, the bank said.

President and chief executive officer Joseph Ficalora said in a conference call with analysts, "The impact of the modest decline in our margin on our first-quarter earnings was largely offset by the volume of loans we produced over the course of the quarter and by the increase in income from mortgage banking activity."

New York Community Bancorp has two bank subsidiaries -- New York Community Bank, with 242 branches in New York, New Jersey, Ohio, Florida and Arizona; and New York Commercial Bank, with 34 branches in Manhattan, Queens, Brooklyn, Long Island and Westchester County. New York Community Bank's local divisions include Roslyn Savings Bank on Long Island.

New York Community's shares closed Wednesday at $13.33, down 32 cents, on the New York Stock Exchange.

Astoria Financial Corp. said net income in the quarter was $10 million, or 11 cents a share, down from $27.4 million or 29 cents a year earlier, on pretax charges this year of $3.4 million for severance-related expenses associated with cost control measures. The company said it eliminated 142 positions in February -- it had 1,541 employees at the end of last year, according to Bloomberg News -- as part of its cost-cutting efforts.

Monte N. Redman, president and chief executive, said in a statement that what he called "robust" multi-family and commercial real estate lending in the quarter fueled growth in the bank's loan portfolio, the first such growth in several years.

Astoria's shares closed down 10 cents at $9.11.