<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities and Exchange Act of 1934
Date of Report (Date of earliest event reported)
April 27, 1998
Long Island Bancorp, Inc.
(Exact Name of Registrant as Specified in its Charter)
Delaware 0-23526 11-3198508
(State or Other Jurisdiction (Commission File (I.R.S. Employer
of Incorporation) Number) Identification No.)
201 Old Country Road
Melville, New York 11747-2724
(Address of Principal (Zip Code)
Executive Offices)
Registrant's telephone number, including area code (516) 547-2000
Not Applicable
(Former Name of Former Address, if Changed Since Last Report)
<PAGE>
Item 1. Changes in Control Registrant
Not Applicable
Item 2. Acquisition or Disposition of Assets
Not Applicable
Item 3. Bankruptcy or Receivership
Not Applicable
Item 4. Changes in Registrant's Certifying Accountant
Not Applicable
Item 5. Other Events
Press Release of Long Island Bancorp, Inc.
dated April 27, 1998
Item 6. Resignations of Registrant's Directors
Not Applicable
Item 7. Financial Statements and Exhibits
(a) Not Applicable
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
LONG ISLAND BANCORP, INC.
By: /s/ Mark Fuster
Name: Mark Fuster
Title: Chief Financial Officer
(principal financial and
accounting officer)
Date: April 27, 1998
<PAGE>
LONG ISLAND BANCORP NEWS RELEASE
201 Old Country Road
Melville, New York 11747
Contact:
Mary M. Feder
Vice President, Investor Relations
516-547-2607
LONG ISLAND BANCORP, INC. REPORTS SECOND QUARTER EARNINGS
Melville, New York, April 28, 1998 - Long Island Bancorp, Inc. (NASDAQ:
LISB), the holding company for The Long Island Savings Bank, FSB today reported
net income of $13.9 million or diluted earnings per share of $0.60 for the
quarter ended March 31, 1998, representing the eighth consecutive quarter of
increased earnings (excluding one-time charges). Net income for the same period
in 1997 was $12.1 million, or $0.52 per diluted share. For the six months ended
March 31, 1998, net income totaled $27.1 million, an increase of $3.0 million,
or 12.8%, from $24.1 million earned in fiscal 1997. Diluted earnings per share
for the six month period in 1998 and 1997 were $1.17 and $1.03, respectively.
Basic earnings per share for the three and six month periods in 1998 were $0.63
and $1.22, respectively, compared with $0.54 and $1.06 for the same period in
1997.
Commenting on the first quarter earnings, John J. Conefry, Jr.,
Chairman of the Board and Chief Executive Officer stated, "We are proud to
report record earnings and a strong financial performance. Earnings growth of
15.0% for the current quarter, supported by a managed decline in general and
administrative expense, has resulted in the eighth consecutive quarter of
improved earnings. Return on average assets and stockholders' equity ratios also
improved substantially in the current quarter."
Earnings Summary for the Quarter Ended March 31, 1998
- -----------------------------------------------------
Net interest income increased by $0.3 million to $40.4 million during
the quarter ended March 31, 1998 from $40.1 million in the same quarter of 1997.
The increase in net interest income is attributable to the growth of the average
real estate loan portfolio to $3.5 billion for the 1998 quarter from $3.3
billion for the 1997 quarter and the growth in average debt and equity
securities to $358.2 million for the 1998 quarter from $211.5 million for the
1997 quarter. This growth was funded by a $242.4 million increase in average
borrowed funds and an $82.6 million increase in average deposits. On a
consecutive quarter basis the net interest margin increased to 2.73% for the
1998 quarter from 2.67% for the quarter ended December 31,1997 and reflects the
Company's efforts to reduce deposit interest costs. In comparison to the
March 31, 1997 quarter,the net interest margin declined from 2.90% primarily
due to the higher funding costs related to borrowed funds and an 11 basis
point decline in the average yield on real estate loans.
The provision for possible loan losses remained constant at $1.5
million for the quarters ended March 31, 1998 and 1997 as asset quality remained
stable.
Total non-interest income increased by $0.6 million, or 7.0%, to $9.3
million for the quarter ended March 31, 1998 compared with the same period in
1997. This increase is attributable to increases in net gains on asset sales of
$1.8 million, an increase of $0.1 million in income from insurance and
securities commissions and a decline of $0.3 million in net losses on
investments in real estate and premises. These improvements were partially
offset by decreases of $1.3 million in loan servicing fee income and $0.2
million in other income. The increased gains on asset sales is primarily due to
a $0.5 million improvement in the Company's mortgage banking activities, greater
profits of $1.3 million from the sale of MBS's and debt and equity securities.
The decline in loan service fee income is due to a $1.8 million increase in the
amortization of mortgage servicing rights as a result of increased mortgage
refinancing activity. Partially offsetting the rise in amortization was greater
fee income stemming from a net increase of $300.0 million in the mortgage
servicing portfolio and the reversal of previous provisions for market
fluctuations.
Total G&A expense decreased by $1.4 million, or 5.4%, to $25.2 million
for the quarter ended March 31, 1998 compared with the same period in fiscal
1997. This decrease represents the third consecutive quarter of declining G&A
expense. Contributing to this decrease were reductions in compensation and
benefit costs of $1.7 million, advertising expense of $0.5 million and office
occupancy and equipment expense of $0.2 million. These decreases were partially
offset by an increase in other G&A expense of $0.9 million. Compensation and
benefit costs decreased due to greater net deferred costs resulting from
increased loan production, the outsourcing of computer processing operations and
the previous downsizing of loan production offices. Advertising costs have
declined as a result of the deferral of marketing initiatives. Other G&A expense
rose due to an increase in other professional services resulting from the
outsourcing of computer processing operations and an increase in legal costs.
Income tax expense increased to $8.8 million for the quarter ended
March 31, 1998 from $8.2 million for the 1997 quarter, primarily reflecting
higher pre-tax income partially offset by a 149 basis point decline in the
effective tax rate as a result of tax planning initiatives that began in October
1997.
Earnings Summary for the Six Months Ended March 31, 1998
- --------------------------------------------------------
Net interest income decreased by $1.0 million, or 1.3%, to $79.4
million during the six months ended March 31, 1998 compared with the same period
in 1997. This decrease is attributable to a flat yield curve coupled with an
increase in average borrowed funds. These factors contributed to a decline in
the net interest margin to 2.70% in the 1998 period from 2.99% in the 1997
period.
Total non-interest income increased by $2.1 million, or 11.7%, for the
six months ended March 31, 1998 compared with the 1997 period. This increase is
primarily due to increases in net gains on asset sales of $3.9 million, an
increase of $0.3 million in income from insurance and securities commission and
a decline of $0.4 million in net loss on investment in real estate and premises.
These improvements were partially offset by decreases in loan servicing fees of
$2.1 million and loan fees and service charges of $0.2 million. The increased
gains on asset sales is primarily due to an improvement of $1.4 million in the
Company's mortgage banking activities, greater profits of $2.5 million from the
sale of MBS's and debt and equity securities. The decline in loan service fee
income is due to additional mortgage servicing right amortization of $3.1
million, as a result of increased mortgage refinance activity, which was
partially offset by the expansion of the mortgage servicing portfolio. Net loss
on investment in real estate and premises declined to a loss of $0.7 million for
the 1998 period from a loss of $1.1 million for the 1997 period primarily
reflecting improvement in REO dispositions.
Total G&A expense decreased by $3.0 million, or 5.6%, to $50.7 million
for the six months ended March 31, 1998 compared with the same period in fiscal
1997. Contributing to this decrease were reductions in compensation and benefits
costs of $1.5 million for the reasons described earlier. Federal insurance
premiums declined by $1.1 million as a result of the 1996 enactment of the
BIF/SAIF legislation and advertising expense declined by $1.1 million as
described above. The effect of these decreases were partially offset by the $0.8
million increase in other G & A expense resulting from an increase in other
professional services due to the outsourcing of computer processing operations
and an increase in legal costs.
Income tax expense increased to $17.2 million for the six months
ended March 31, 1998 primarily reflecting higher pre-tax income partially
offset by a 172 basis point decline in the effective tax rate as previously
described.
Balance Sheet Summary
- ---------------------
Total assets at March 31, 1998 were $6.3 billion, an increase of $365.1
million since September 30, 1997. The growth in assets is attributable to
increases of $149.4 million in investment in debt and equity securities, $96.9
million in MBS's, $81.3 million in total net loans held for investment and sale,
and $38.1 million in cash and cash equivalents. Loan volume for the six months
ended March 31, 1998 was $1.4 billion, of which $6.1 million represents bulk
purchases of loans as compared with $1.4 billion and $193.7 million,
respectively, for the six months ended March 31, 1997.
Total liabilities at March 31, 1998 were $5.7 billion, an increase of
$347.7 million since September 30, 1997. The increase in total liabilities
primarily reflects an increase in borrowed funds of $286.2 million to $1.8
billion and an increase in deposit liabilities of $31.6 million to $3.8 billion
at March 31, 1998.
Stockholders' equity increased by $17.4 million to $563.7 million since
September 30, 1997. The increase consists of earnings of $27.1 million and $3.0
million related to the Company's stock benefit plans. These increases were
offset by a decline of $0.5 million in unrealized gains on securities classified
as available-for-sale, net of tax, the net purchase of treasury stock of $5.6
million, and the declaration of $6.6 million in dividends. At March 31, 1998
book value per share amounted to $23.55.
Long Island Bancorp's Pending Merger with Astoria Financial Corporation;
Termination of Fourth Stock Repurchase Program
The Company announced on April 3, 1998, that it had entered into a definitive
agreement pursuant to which Astoria Financial Corporation will acquire Long
Island Bancorp,Inc. The transaction, which is subject to regulatory and
shareholder approvals and will be accounted for as a pooling of interests, is
anticipated to close during the third calendar quarter. In connection with
the merger, both the Company and Astoria announced that their respective
stock repurchase programs have been terminated.
At March 31, 1998, Astoria had $10.9 billion in assets, $6.2 billion in
deposits and operates sixty-one banking offices and provides retail banking,
mortgage and consumer loan services to over 375,000 customers.
Certain reclassifications have been made to prior year amounts to
conform to the current year presentation. Long Island Bancorp, Inc. is the
holding company for The Long Island Savings Bank, FSB. The Long Island
Savings Bank, FSB is a federally chartered FDIC-insured institution which
serves its customers through 35 full service branch offices throughout Queens,
Nassau and Suffolk counties. The Bank also operates mortgage loan offices
across Long Island and in New Jersey, Pennsylvania, Maryland, Virginia,
North Carolina, and Georgia and has an Internet home pages at the addresses:
www.lisb.com. and www. entrustmortgage.com
(Financial tables attached)
This document may contain forward looking statements based on current
management expectations. The Company's actual results could differ materially
from those management expectations. Factors that could cause future results to
vary from current management expectations include, but are not limited to,
general economic conditions, changes in interest rates, deposit flows, the cost
of funds, cost of federal deposit insurance premiums, cost of stock-based
benefit plans, demand for loan products, demand for financial services,
competition, changes in the quality or composition of the Company's loan and
investment portfolios, changes in accounting principles, policies or guidelines,
and other economic, competitive, governmental, regulatory and technological
factors affecting the Company's operations, products, services and prices.
Additional factors are described in the Company's public reports filed with the
Securities and Exchange Commission.
<PAGE>
<TABLE>
<CAPTION>
LONG ISLAND BANCORP, INC.
AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(In thousands, except share data)
March 31, September 30,
1998 1997
--------------------------------------
<S>
ASSETS <C> <C>
Cash and cash equivalents (including interest-earning assets of $41,338 and
$9,735, respectively) $ 81,850 $ 43,705
Investment in debt and equity securities, net:
Available-for-sale 287,966 138,578
Mortgage-backed securities, net:
Held-to-maturity (estimated fair value of
$19,525 and $20,188, respectively) 21,462 22,223
Available-for-sale 1,906,134 1,808,471
Stock in Federal Home Loan Bank of New York, at cost 50,548 48,724
Loans held for sale 262,294 157,617
Loans receivable held for investment, net:
Real estate loans, net 3,300,790 3,333,185
Commercial loans, net 8,392 6,465
Other loans, net 185,571 178,325
--------------------------------------
Loans, net 3,494,753 3,517,975
Less allowance for possible loan losses (34,041) (33,881)
--------------------------------------
Total loans receivable held for investment, net 3,460,712 3,484,094
Mortgage servicing rights, net 45,641 41,789
Office properties and equipment, net 86,086 88,466
Accrued interest receivable, net 35,953 35,334
Investment in real estate, net 9,403 9,103
Deferred taxes 18,680 16,547
Excess of cost over fair value of assets acquired 4,864 5,069
Prepaid expenses and other assets 24,275 31,064
--------------------------------------
Total assets $ 6,295,868 $ 5,930,784
======================================
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Deposits $ 3,762,115 $ 3,730,503
Official checks outstanding 25,066 26,840
Borrowed funds,net 1,787,629 1,501,456
Mortgagors' escrow payments 82,654 69,353
Accrued expenses and other liabilities 74,660 56,257
--------------------------------------
Total liabilities 5,732,124 5,384,409
Stockholders' equity:
Preferred stock ($0.01 par value, 5,000,000 shares authorized;
none issued)
--- ---
Common stock ($0.01 par value, 130,000,000 and 45,000,000 shares
authorized, respectively; 26,816,464 shares issued, 23,934,414 and
24,022,924 outstanding, respectively) 268 268
Additional paid-in capital 311,907 309,372
Unallocated Employee Stock Ownership Plan (17,727) (18,079)
Unearned Management Recognition & Retention Plan (2,980) (3,816)
Unrealized gain on securities available-for-sale, net of tax 12,468 12,947
Retained income-partially restricted 339,427 319,756
Treasury stock, at cost (2,882,050 and 2,793,540 shares, (79,619) (74,073)
respectively)
--------------------------------------
Total stockholders' equity 563,744 546,375
--------------------------------------
Total liabilities and stockholders' equity $ 6,295,868 $ 5,930,784
======================================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
LONG ISLAND BANCORP, INC.
AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
FOR THE THREE MONTHS ENDED FOR THE SIX MONTHS ENDED
MARCH 31, MARCH 31, MARCH 31, MARCH 31,
-------------------------------------------------------------------
1998 1997 1998 1997
------------- ------------- ------------- --------------
<S> <C> <C> <C> <C>
Interest income:
Real estate loans $ 63,997 $ 61,906 $ 129,336 $ 121,064
Commercial loans 192 152 343 330
Other loans 4,322 3,758 8,618 7,663
Mortgage-backed securities 30,085 29,509 58,664 58,508
Debt and equity securities 6,399 3,942 12,551 7,672
------------- ------------- -----------------------------
Total interest income 104,995 99,267 209,512 195,237
------------- ------------- -----------------------------
Interest expense:
Deposits 39,539 38,839 80,981 78,276
Borrowed funds 25,065 20,298 49,173 36,575
------------- ------------- -----------------------------
Total interest expense 64,604 59,137 130,154 114,851
------------- ------------- -----------------------------
Net interest income 40,391 40,130 79,358 80,386
Provision for possible loan losses 1,500 1,500 3,000 3,000
------------- ------------- -----------------------------
Net interest income after provision for possible 38,891 38,630 76,358 77,386
loan losses
------------- ------------- -----------------------------
Non-interest income:
Fees and other income:
Loan fees and service charges 859 890 1,696 1,895
Loan servicing fees 1,786 3,108 4,369 6,490
Income from insurance and securities commissions 698 590 1,388 1,098
Deposit service fees 1,393 1,413 2,847 2,941
------------- ------------- -----------------------------
Total fee income 4,736 6,001 10,300 12,424
Other income 824 997 1,817 1,859
------------- ------------- -----------------------------
Total fees and other income 5,560 6,998 12,117 14,283
------------- ------------- -----------------------------
Net gains on sale activity:
Net gains on loans and mortgage-backed securities 3,313 2,263 7,272 4,238
Net gain (loss) on investment in debt and equity
securities 706 ---- 925 98
------------- ------------- -----------------------------
Total net gains on sale activity 4,019 2,263 8,197 4,336
Net gain (loss) on investment in real estate and premises (280) (570) (724) (1,085)
------------- ------------- -----------------------------
Total non-interest income 9,299 8,691 19,590 17,534
Non-interest expense:
General and administrative expense:
Compensation, payroll taxes and fringe benefits 13,156 14,832 27,467 28,960
Advertising 637 1,089 1,244 2,344
Office occupancy and equipment 5,377 5,567 10,866 10,963
Federal insurance premiums 801 777 1,597 2,682
Other general and administrative expense 5,253 4,396 9,524 8,744
------------- ------------- -----------------------------
Total general and administrative expense 25,224 26,661 50,698 53,693
Litigation expense - goodwill lawsuit 116 275 710 551
Amortization of excess of cost over fair value of assets
acquired 97 109 205 218
------------- ------------- -----------------------------
Total non-interest expense 25,437 27,045 51,613 54,462
------------- ------------- -----------------------------
Income before income taxes 22,753 20,276 44,335 40,458
Provision for income taxes 8,816 8,159 17,216 16,407
------------- ------------- -----------------------------
Net income $ 13,937 $ 12,117 $ 27,119 $ 24,051
============= ============= =============================
Basic earnings per common share $ 0.63 $ 0.54 $ 1.22 $ 1.06
============= ============= =============================
Diluted earnings per common share $ 0.60 $ 0.52 $ 1.17 $ 1.03
============= ============= =============================
</TABLE>
(a) The Company adopted Statement of Financial Accounting Standards ("SFAS")
No. 128, "Earning per Share" as of December 31, 1997. SFAS No.128 replaces
primary earnings per share ("EPS") with basic EPS and fully diluted EPS with
diluted EPS. Basic EPS is computed by dividing income available to common
stockholders by the weighted average number of common shares outstanding for the
period. Diluted EPS reflects the potential dilution of options, warrants and
convertible securities. Net income per common share amounts for the 1997
periods have been restated to reflect the adoption of SFAS No. 128.
<PAGE>
<TABLE>
<CAPTION>
LONG ISLAND BANCORP, INC.
AND SUBSIDIARY
AVERAGE BALANCE SHEET
FOR THE THREE MONTHS ENDED MARCH 31,
------------------------------------------------------------------------------
1998 1997
------------------------------------- --------------------------------------
AVERAGE AVERAGE
AVERAGE YIELD\ AVERAGE YIELD\
BALANCE INTEREST COST BALANCE INTEREST COST
-------------- ------------ -------------- -------------- ------------- ---------------
<S> <C> <C> <C> <C> <C> <C>
(DOLLARS IN THOUSANDS)
INTEREST-EARNING ASSETS
Interest-earning cash
equivalents $ 75,596 $ 902 4.84 % $ 73,621 $ 954 5.26 %
Debt and equity securities
and FHLB-NY stock, net (1) 358,166 5,497 6.14 211,489 2,988 5.65
Mortgage-backed securities, 1,797,360 30,085 6.70 1,768,061 29,509 6.68
net (1)
Real estate loans, net (2) 3,499,885 63,997 7.31 3,336,978 61,906 7.42
Commercial and other loans, 177,064 4,514 10.20 145,666 3,910 10.74
net (2)
-------------- ------------ ------------ -------------- ------------- ------------
Total interest-earning assets 5,908,071 104,995 7.11 5,535,815 99,267 7.17
Other non-interest-earning 247,016 264,919
assets
-------------- ------------ -------------- -------------
Total assets $ 6,155,087 $ 104,995 $ 5,800,734 $ 99,267
============== ============ ============== =============
INTEREST BEARING LIABILITIES
Deposits, net $ 3,789,811 $ 39,539 4.23 % $ 3,707,228 $ 38,839 4.25 %
Borrowed funds 1,685,030 25,065 6.03 1,442,630 20,298 5.71
-------------- ------------ ------------ -------------- ------------- ------------
Total interest-bearing 5,474,841 64,604 4.79 5,149,858 59,137 4.66
liabilities
Non-interest-bearing 118,321 125,123
liabilities
-------------- --------------
Total liabilities 5,593,162 5,274,981
Total stockholders' equity 561,925 525,753
-------------- ------------ ------------ -------------- ------------- ------------
Total liabilities and
stockholders'
equity $ 6,155,087 $ 64,604 $ 5,800,734 $ 59,137
============== ------------ ============== -------------
Net interest income/spread (3) $ 40,391 2.32 % $ 40,130 2.51 %
============ ============ ============= ============
Net interest margin as %
of interest-earning assets 2.73 % 2.90 %
(4)
============ ============
Ratio of interest-earning
assets to
interest-bearing 107.91 % 107.49 %
liabilities
============ ============
</TABLE>
(1) Debt and equity and mortgage-backed securities are shown including the
average market value appreciation of $21.5 million and $15.0 million for the
three months ended March 31, 1998 and 1997, respectively.
(2) Net of unearned discounts, premiums, deferred loan fees, purchase accounting
discounts and premiums and allowance for possible loan losses, and including
non-performing loans and loans held for sale.
(3) Interest rate spread represents the difference between the average rate
on interest-earning assets and the average cost of interest-bearing liabilities.
(4) Net interest margin represents net interest income divided by average
interest-earning assets.
<PAGE>
<TABLE>
<CAPTION>
LONG ISLAND BANCORP, INC.
AND SUBSIDIARY
AVERAGE BALANCE SHEET
FOR THE SIX MONTHS ENDED MARCH 31,
------------------------------------------------------------------------------
1998 1997
------------------------------------- --------------------------------------
AVERAGE AVERAGE
AVERAGE YIELD\ AVERAGE YIELD\
BALANCE INTEREST COST BALANCE INTEREST COST
------------ ----------- ------------ ----------- ---------- -------------
<S> <C> <C> <C> <C> <C> <C>
(DOLLARS IN THOUSANDS)
INTEREST-EARNING ASSETS
Interest-earning cash
equivalents $ 71,303 $ 1,822 5.12 % $ 65,921 $ 1,720 5.23 %
Debt and equity securities
and FHLB-NY stock, net 343,309 10,729 6.25 212,253 5,952 5.61
(1)
Mortgage-backed 1,779,508 58,664 6.59 1,730,596 58,508 6.76
securities, net (1)
Real estate loans, net 3,501,565 129,336 7.39 3,219,987 121,064 7.52
(2)
Commercial and other 174,818 8,961 10.25 142,910 7,993 11.19
loans, net (2)
------------ ----------- ---------- ----------- ---------- -----------
Total interest-earning 5,870,503 209,512 7.14 5,371,667 195,237 7.27
assets
Other 241,692 282,765
non-interest-earning
assets
------------ ----------- ----------- ----------
Total assets $ 6,112,195 $ 209,512 $5,654,432 $ 195,237
============ =========== =========== ==========
INTEREST BEARING
LIABILITIES
Deposits, net $ 3,792,630 $ 80,981 4.28 % $3,707,927 $ 78,276 4.23 %
Borrowed funds 1,661,125 49,173 5.94 1,286,370 36,575 5.70
------------ ----------- ---------- ----------- ---------- -----------
Total interest-bearing 5,453,755 130,154 4.79 4,994,297 114,851 4.61
liabilities
Non-interest-bearing 102,589 135,013
liabilities
------------ -----------
Total liabilities 5,556,344 5,129,310
Total stockholders' 555,851 525,122
equity
------------ ----------- ---------- ----------- ---------- -----------
Total liabilities and
stockholders'
equity $ 6,112,195 $ 130,154 $5,654,432 $ 114,851
============ ----------- =========== ----------
Net interest $ 79,358 2.35 % $ 80,386 2.66 %
income/spread (3)
=========== ========== ========== ===========
Net interest margin as %
of interest-earning 2.70 % 2.99 %
assets (4)
========== ===========
Ratio of interest-earning
assets to
interest-bearing 107.64 % 107.56 %
liabilities
========== ===========
</TABLE>
(1) Debt and equity and mortgage-backed securities are shown including the
average market value appreciation of $21.8 million and $15.5 million for the
six months ended March 31, 1998 and 1997, respectively.
(2) Net of unearned discounts, premiums, deferred loan fees, purchase accounting
discounts and premiums and allowance for possible loan losses, and including
non- performing loans and loans held for sale.
(3) Interest rate spread represents the difference between the average rate
on interest-earning assets and the average cost of interest-bearing
liabilities.
(4) Net interest margin represents net interest income divided by average
interest-earning assets.
<PAGE>
<TABLE>
<CAPTION>
LONG ISLAND BANCORP, INC.
AND SUBSIDIARY
FINANCIAL HIGHLIGHTS
At or for the Three Months At or for the Six Months
Ended March 31, Ended March 31,
---------------------------------- ----------------------------------
1998 1997 1998 1997
-------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C>
Selected Financial Ratios: (a)
Return on average assets ...................... 0.91% 0.84% 0.89% 0.85%
Return on average stockholders' equity ........ 9.92 9.22 9.76 9.16
Average stockholders' equity to average assets. 9.13 9.06 9.09 9.29
Stockholders' equity to total assets .......... 8.95 9.01 8.95 9.01
Interest rate spread during period............. 2.32 2.51 2.35 2.66
Net interest margin............................ 2.73 2.90 2.70 2.99
Operating expenses to average assets........... 1.64 1.84 1.66 1.90
Efficiency ratio............................... 54.89 56.57 55.42 56.72
Average interest-earning assets to average
interest-......................................bearing 107.91 107.49 107.64 107.56
liabilities....................................
Net interest income to operating expenses ..... 1.60x 1.51x 1.57x 1.50x
Selected Data:
Basic earnings per share....................... $0.63 $0.54 $1.22 $1.06
Weighted average number of shares outstanding
for basic earnings per share computation (b) 22,291,755 22,531,924 22,293,451 22,614,621
Diluted earnings per share..................... $0.60 $0.52 $1.17 $1.03
Weighted average number of shares outstanding
for diluted earnings per share computation 23,226,468 23,393,522 23,208,293 23,437,029
(b)
Book value per share........................... $23.55 $21.62 $23.55 $21.62
Number of shares outstanding for book value per
share computation........................... 23,934,414 24,228,267 23,934,414 24,228,267
Cash dividends declared per share.............. $0.15 $0.15 $0.30 $0.30
Dividend payout ratio.......................... 25.00% 28.85% 25.64% 29.13%
At March 31,
----------------------------
1998 1997
------------ -----------
Asset Quality Ratios:
Non-performing loans to total gross loans.................... 1.26% 1.44%
Non-performing assets to total assets........................ 0.86 1.04
Allowance for possible loan losses to non-performing loans... 71.90 66.07
Regulatory Capital at March 31, 1998 for The Long Island Savings Bank, FSB:
..
Regulatory Regulatory Excess
Capital Capital Capital
Requirement Level Level
Amount Percent Amount Percent Amount Percent
(Dollars in thousands)
Tangible capital........................... $93,219 1.50 % $457,854 7.37 % $364,635 5.87%
Core capital................ 186,438 3.00 457,854 7.37 271,416 4.37
Risk-based capital......................... 252,414 8.00 491,895 15.59 239,481 7.59
</TABLE>
(a) Ratios for the three months ended March 31, 1998 and 1997 were calculated on
an annualized basis.
(b) The weighted average common shares outstanding for periods prior to
March 31, 1998, have been restated to reflect the adoption of SFAS No. 128.
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LONG ISLAND BANCORP, INC.
AND SUBSIDIARY
SUPPLEMENTAL INFORMATION
SELECTED FINANCIAL DATA - CASH EARNINGS
Three Months Ended March 31, Six Months Ended
March 31,
------------------------------- ----------------------------------
1998 1997 1998 1997
-------------- --------------- ------------- --------------
(In thousands, except per share data)
<S> <C> <C> <C> <C>
Net income $ 13,937 $ 12,117 $ 27,119 $ 24,051
Add back selected non-cash items:
Amortization of excess of cost over fair value
of assets acquired 97 109 205 218
Management Recognition & Retention Plan and
Employee Stock Ownership Plan expense 1,481 1,506 2,729 3,644
-------------- --------------- -------------- --------------
Cash earnings $ 15,515 $ 13,732 $ 30,053 $ 27,913
============== =============== ============== ==============
Cash EPS(a) $ 0.70 $ 0.61 $ 1.35 $ 1.23
============== =============== ============== ==============
At or for the Three Months At or for the Six Months
Ended March 31, Ended March 31,
--------------------------------- --------------------------------
1998 1997 1998 1997
-------------- -------------- -------------- ---------------
Selected Financial Ratios Based Upon Cash Earnings (b):
Cash return on average assets................................. 1.01% 0.95% 0.98% 0.99%
Cash return on average stockholders' equity................... 11.04 10.45 10.81 10.63
Cash return on average tangible stockholders' equity.......... 11.14 10.55 10.91 10.73
Cash operating expenses to average assets..................... 1.54 1.73 1.56 1.73
Cash efficiency ratio......................................... 51.46 53.14 52.22 52.64
Net interest income to cash operating expenses................ 1.71x 1.60x 1.66x 1.61x
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(a) Cash EPS was calculated based on the weighted average number of shares
outstanding for basic EPS computation. (b) Ratios for the three months ended
March 31, 1998 and 1997 were calculated on an annualized basis.
