Carver Bancorp, Inc. Announces Second Quarter 2008 Results

Reports Second Quarter Net Income of $0.8 Million and Diluted EPS of $0.30


NEW YORK, Nov. 20, 2007 (PRIME NEWSWIRE) -- Carver Bancorp, Inc. (the "Company") (Nasdaq:CARV), the holding company for Carver Federal Savings Bank, today announced its results of operations for the three- and six-month periods ended September 30, 2007, the second quarter of the fiscal year ending March 31, 2008 ("fiscal 2008").

The Company reported net income of $0.8 million and diluted earnings per share of $0.30 for the second quarter of fiscal 2008, compared to a net loss of $0.9 million and diluted loss per share of $0.36 for the second quarter of fiscal 2007. For the six month period ended September 30, 2007, the Company reported net income of $1.9 million, or $0.74 per diluted share, compared to a net loss of $0.1 million, or $0.04 per diluted share, for the prior year period last year. Excluding special charges in the three- and six-month periods ended September 30, 2006, on a non-GAAP basis the Company's adjusted net income was $0.7 million and $1.5 million, or $0.23 per diluted share and $0.59 per diluted share, respectively.

Deborah C. Wright, the Company's Chairman and CEO, stated: "Carver's earnings and other key metrics were stable in the second quarter, during an obviously challenging period for the banking industry. Net income was up modestly, on an ongoing basis year over year, as net interest margin increased 24% and fee income from our lending and retail businesses increased 41%. I'm pleased to note that credit quality remains solid. In addition, Carver's New Markets Tax Credit ("NMTC") award continues to provide a net income tax benefit. Nevertheless, expenses rose sharply as results include absorption of Community Capital Bank's ("CCB") operations, investments in new talent, costs in preparation for implementation of Sarbanes-Oxley Act Section 404 at the end of this fiscal year, and other consulting assistance. In coming months we will announce specific measures to improve our cost structure."

Ms. Wright also announced that on November 19, 2007, the Company's Board of Directors declared a cash dividend on its common stock of ten cents ($0.10) per share for the quarter ended September 30, 2007. Ms. Wright said: "The dividend reflects the Board of Directors' continued confidence in Carver's long-term growth and earnings outlook." The dividend will be payable on December 17, 2007 to stockholders of record at the close of business on December 3, 2007.

Income Statement Highlights

Second Quarter Results

The Company reported net income for the quarter ended September 30, 2007 of $0.8 million compared to a net loss of $0.9 million for the prior year period, an increase of $1.7 million. These results primarily reflect an increase in net interest income of $1.3 million and an increase in non-interest income of $1.8 million, offset by increases in non-interest expense of $1.0 million and a decline in income tax benefit of $0.4 million. The prior year period included special charges of $1.3 million in transaction costs to acquire CCB and $1.3 million to accelerate the Company's balance sheet repositioning.

Interest income increased by $2.7 million, or 28.9%, to $12.1 million for the quarter ended September 30, 2007, compared to $9.4 million in the prior year period. Interest income increased primarily as a result of an increase in average loan balances and yields this fiscal period compared to the prior year period. The average loan balance increased $131.8 million, or 26%, to $639.3 million in the quarter ended September 30, 2007 compared to $507.5 million for the prior year period, due to balances acquired from CCB and originations. The increase in interest income also benefited from the mix of loan originations offset by a decline in the average balance of mortgage-backed securities, though yields increased. Overall, the annualized average yield on total interest-earning assets increased 67 basis points to 6.85% for the quarter ended September 30, 2007 compared to 6.18% for the prior year period, reflecting increases in yields on loans and total securities of 44 basis points and 127 basis points, respectively.

Interest expense increased by $1.4 million, or 34.9%, to $5.6 million for the three months ended September 30, 2007, compared to $4.2 million for the prior year period. The higher interest expense resulted primarily from a 49 basis point increase in the annualized average cost of interest-bearing liabilities to 3.47% for the three months ended September 30, 2007, compared to 2.98% for the prior year period. Additionally, the average balance of interest-bearing liabilities increased $94.0 million, or 16.9%, to $649.5 million, compared to $555.5 million for the prior year period. The increase in interest expense was primarily the result of interest paid on deposits due to an increase of $101.6 million, or 21.8%, in the average balance of interest-bearing deposits to $567.5 million for the three months ended September 30, 2007, compared to $465.9 million for the prior year period. In addition, a 65 basis point increase in the rate paid on deposits to 3.23% compared to 2.58% for the prior year period contributed to the increase.

The Company did not provide for additional loan reserves for the three months ended September 30, 2007, as it considers the overall allowance for loan losses to be adequate.

Total non-interest income for the quarter ended September 30, 2007 increased $1.8 million to $1.5 million, compared to a loss of $0.3 million for the prior year period. The increase in non-interest income resulted mainly from an increase of $0.3 million in loan fees and service charges to $0.5 million compared to $0.2 million for the prior year period. In addition, the prior year period included a $1.3 million charge associated with the balance sheet repositioning initiative implemented to improve margins.

Non-interest expense for the quarter ended September 30, 2007 increased $1.0 million, or 15.3%, to $7.2 million compared to $6.2 million for the prior year period. The increase in non-interest expense reflects absorption of CCB's operations and was primarily due to an increase of $0.8 million in employee compensation and benefits to $3.1 million compared to $2.3 million, $0.3 million in net occupancy expense to $0.9 million compared to $0.6 million, and $1.1 million in other non-interest expense to $2.6 million compared to $1.5 million, respectively, for the prior year period. Other non-interest expense includes investments in new talent, costs in preparation for implementation of Sarbanes-Oxley Act Section 404 at the end of this fiscal year, and other consulting assistance. The increase in other non-interest expense was offset by a decrease of $1.3 million in merger related expenses compared to the prior year period.

For the quarter ended September 30, 2007, income tax benefit decreased $0.4 million, or 90.5%, resulting in a tax benefit of $44,000 compared to a tax benefit of $0.5 million for the prior year period. The reduction in tax benefit reflects taxable income of $0.7 million for the quarter ended September 30, 2007 compared to a loss of $1.4 million for the prior year period. The current period income tax expense of $0.3 million was offset by the benefit of the NMTC award totaling $0.4 million for the quarter ended September 30, 2007. As previously disclosed, the Company is expected to receive benefits from the NMTC award over approximately seven years.

Six-Month Results

Net income for the six months ended September 30, 2007 was $1.9 million compared to a net loss of $0.1 million for the prior year period, an increase of $2.0 million. These results primarily reflect an increase in net interest income of $2.9 million and an increase in non-interest income of $2.0 million, offset by increases in non-interest expense of $2.7 million, and income tax expense of $0.1 million compared to a prior year period benefit of $19,000.

Interest income for the six month period ending September 30, 2007, increased $5.5 million, or 30.0%, to $24.0 million, compared to $18.5 million for the prior year period. The increase in interest income was primarily due to higher yields and average balances of interest-earning assets of 83 basis points and $88.0 million, respectively. These results were primarily driven by increases in average loan balances of $128.2 million and yields on loans of 58 basis points, offset by lower income from total securities and federal funds sold of $0.8 million and $0.1 million, respectively, driven by lower average balances.

Interest expense for the six month period ended September 30, 2007, increased $2.6 million, or 32.4%, to $10.9 million, compared to $8.3 million for the prior year period. The increase in interest expense resulted primarily from a 48 basis point increase in the annualized average cost of interest-bearing liabilities to 3.43%, compared to 2.95% for the prior year period. In addition, the increase in interest expense is due to growth in the average balance of interest-bearing liabilities of $80.9 million, or 14.5%, to $638.6 million, compared to $557.7 million for the prior year period.

The Company did not provide for additional loan reserves for the six months ended September 30, 2007, as it considers the overall allowance for loan losses to be adequate.

Non-interest income for the six month period ended September 30, 2007, increased $2.0 million to $2.6 million compared to $0.6 million for the prior year period, which included a $1.3 million charge related to the Company's balance sheet repositioning. Additionally for the six month period, there was a $0.4 million increase in loan fees and service charges to $0.9 million compared to $0.5 million for the prior year period.

Non-interest expense for the six month period ended September 30, 2007, increased $2.7 million, or 24.8%, to $13.7 million compared to $11.0 million for the prior year period. The increase in non-interest expense was primarily due to increases of $1.7 million in employee compensation and benefits to $6.3 million compared to $4.6 million, $0.6 million in net occupancy expense to $1.8 million compared to $1.2 million, and $1.6 million in other expenses to $4.5 million compared to $2.9 million, respectively, for the prior year period, offset by a decrease of $1.3 million in merger related expenses in the prior year period.

Income taxes increased $0.1 million for the six month period ended September 30, 2007, resulting in a tax expense of $0.1 million compared to a tax benefit of $19,000 for the prior year period. The reduction in tax benefit reflects the taxable income of $2.0 million for the six month period ended September 30, 2007 compared to a loss of $0.1 million for the prior year period. The income tax expense of $0.8 million for the six month period ended September 30, 2007 was offset by the benefit of the NMTC award totaling $0.7 million.

Financial Condition Highlights

At September 30, 2007, total assets increased $25.0 million, or 3.4%, to $765.0 million compared to $740.0 million at March 31, 2007. The increase in total assets was primarily the result of an increase in loans receivable and loans held-for-sale of $27.9 million and an increase in cash and cash equivalents of $3.8 million partially offset by a decrease in investment securities of $8.7 million. Total loans receivable, including loans held-for-sale, increased $27.9 million, or 4.6%, to $637.1 million at September 30, 2007 compared to $609.2 million at March 31, 2007. The increase resulted primarily from an increase in construction loans of $27.4 million. The increase in cash and cash equivalents was primarily a result of a $5.3 million increase in cash and due from banks which was partially offset by a $1.3 million decrease in Federal funds sold. Total securities decreased $8.7 million, or 12.9%, to $58.4 million at September 30, 2007 compared to $67.1 million at March 31, 2007 due to collection of normal principal repayments and maturities.

At September 30, 2007, total liabilities increased by $24.2 million, or 3.5%, to $712.5 million compared to $688.3 million at March 31, 2007. The increase in total liabilities was primarily the result of a net increase of $20.5 million in advances and borrowed money and $5.9 million of additional customer deposits, offset by a reduction of $2.2 million in other liabilities. The increase in advances and borrowed money was primarily the result of repurchase obligations of $30.0 million at September 30, 2007 compared to zero repurchase obligations at March 31, 2007, offset by a $9.5 million reduction in FHLB advances. Deposits increased as a result of an increase in certificates of deposits of $20.5 million, offset by decreases of $7.7 million in savings, $4.0 million in checking and $2.9 million in money market deposit accounts.

At September 30, 2007, total stockholders' equity increased $1.0 million, or 1.8%, to $52.6 million at September 30, 2007 compared to $51.6 million at March 31, 2007. The increase in total stockholders' equity was primarily attributable to net income for the six months ended September 30, 2007 totaling $1.9 million, partially offset by dividends paid of $0.5 million, the repurchase of common stock totaling $0.4 million and a decrease of $0.2 million in accumulated other comprehensive income following mark-to-market of Carver's available-for-sale securities.

Stock Repurchase Program

During the quarter ended September 30, 2007, the Company purchased an additional 29,400 shares of its common stock under its stock repurchase program. To date, the Company has purchased a total of 146,174 shares of the total 231,635 approved under the program, at an average price per share of $16.54. The number of shares yet to be repurchased is 85,461 shares.

Asset Quality

At September 30, 2007, non-performing assets totaled $3.7 million, or 0.58% of total loans receivable compared to $4.5 million, or 0.74% of total loans receivable at March 31, 2007. At September 30, 2007 the ratio of the allowance for loan losses to non-performing loans was 146.2%, compared to 119.9% at March 31, 2007. At September 30, 2007 the ratio of the allowance for loan losses to total loans receivable was 0.84%, compared to 0.89% at March 31, 2007.

About Carver Bancorp, Inc.

Carver Bancorp, Inc. is the holding company for Carver Federal Savings Bank, a federally chartered stock savings bank. Carver Federal Savings Bank, the largest African- and Caribbean-American run bank in the United States, operates ten full-service branches in the New York City boroughs of Brooklyn, Queens and Manhattan. For further information, please visit the Company's website at www.carverbank.com.

Certain statements in this press release are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act. These statements are based on management's current expectations and are subject to uncertainty and changes in circumstances. Actual results may differ materially from those included in these statements due to a variety of factors, risks and uncertainties. More information about these factors, risks and uncertainties is contained in our filings with the Securities and Exchange Commission.



                CARVER BANCORP, INC. AND SUBSIDIARIES
           CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
                (In thousands, except per share data)

                                                Sept. 30,    March 31,
                                                  2007         2007
                                                ---------    ---------
                                               (Unaudited)
 ASSETS
 Cash and cash equivalents:
   Cash and due from banks                      $  19,937    $  14,619
   Federal funds sold                                  --        1,300
   Interest earning deposits                        1,284        1,431
                                                ---------    ---------
      Total cash and cash equivalents              21,221       17,350
 Securities:
   Available-for-sale, at fair value
    (including pledged as collateral
    of $40,366 and $34,649 at September
    30 and March 31, 2007, respectively)           40,572       47,980
   Held-to-maturity, at amortized cost
    (including pledged as collateral
    of $17,286 and $18,581 at September
    30 and March 31, 2007,
    respectively; fair value of
    $17,624 and $19,005 at September
    30 and March 31, 2007, respectively)           17,868       19,137
                                                ---------    ---------
        Total securities                           58,440       67,117

 Loans held-for-sale                               25,901       23,226

 Gross loans receivable:
    Real estate mortgage loans                    555,096      533,667
    Consumer and commercial loans                  56,083       52,293
     Allowance for loan losses                     (5,338)      (5,409)
                                                ---------    ---------
      Total loans receivable, net                 605,841      580,551

 Office properties and equipment, net              15,181       14,626
 Federal Home Loan Bank of New York
  stock, at cost                                    2,660        3,239
 Bank owned life insurance                          8,955        8,795
 Accrued interest receivable                        4,460        4,335
 Goodwill                                           6,370        5,716
 Core deposit intangibles, net                        608          684
 Other assets                                      15,385       14,313
                                                ---------    ---------
      Total assets                              $ 765,022    $ 739,952
                                                =========    =========

 LIABILITIES AND STOCKHOLDERS' EQUITY
 Liabilities:
   Deposits                                     $ 620,950     $615,122
   Advances from the FHLB-NY and other
    borrowed money                                 81,609       61,093
   Other liabilities                                9,907       12,110
                                                ---------    ---------
      Total liabilities                           712,466      688,325
 Stockholders' equity:
   Common stock (par value $0.01 per
    share: 10,000,000 shares;
    authorized; 2,524,691 shares
    issued; 2,480,722 and 2,507,985
    shares outstanding at September 30
    and March 31, 2007, respectively                   25           25
   Additional paid-in capital                      24,062       23,996
   Retained earnings                               28,919       27,436
   Unamortized awards of common stock
    under ESOP and MRP                                 (4)          (4)
   Treasury stock, at cost (43,969 and
    16,706 shares at September 30 and
    March 31, 2007, respectively)                    (694)        (277)
   Accumulated other comprehensive
    income                                            248          451
                                                ---------    ---------
      Total stockholders' equity                   52,556       51,627
                                                ---------    ---------
   Total liabilities and stockholders'
    equity                                      $ 765,022    $ 739,952
                                                =========    =========


                 CARVER BANCORP, INC. AND SUBSIDIARIES
                   CONSOLIDATED STATEMENTS OF INCOME
                 (In thousands, except per share data)
                              (Unaudited)

                                      Three Months       Six Months
                                         Ended             Ended
                                      September 30,     September 30,
                                      2007    2006      2007     2006
                                    -------  -------  -------  -------
 Interest Income:
  Loans                             $11,184  $ 8,317  $22,177  $16,208
  Mortgage-backed securities            474      842      976    1,775
  Investment securities                 401      168      855      349
  Federal funds sold                     29       53       41      169
                                    -------  -------  -------  -------
    Total interest income            12,088    9,380   24,049   18,501

 Interest expense:
  Deposits                            4,570    3,026    8,901    6,021
  Advances and other borrowed
   money                              1,055    1,143    2,030    2,233
                                    -------  -------  -------  -------
    Total interest expense            5,625    4,169   10,931    8,254

    Net interest income
     before provision for
     loan losses                      6,463    5,211   13,118   10,247

 Provision for loan losses               --       --       --       --
                                    -------  -------  -------  -------
    Net interest income after
     provision for loan
     losses                           6,463    5,211   13,118   10,247

 Non-interest income:
  Depository fees and charges           686      601    1,315    1,210
  Loan fees and service
   charges                              512      245      890      490
  Write-down of loans held
   for sale                              --     (702)      --     (702)
  Gain (loss) on sale of
   securities                            79     (645)      79     (645)
  Gain (loss) on sale of
   loans                                (19)      76       28       88
  Gain on sale of fixed
   assets                                 1        3        1        3
  Other                                 194       85      276      163
                                    -------  -------  -------  -------
     Total non-interest
      income (loss)                   1,453     (337)   2,589      607

 Non-interest expense:
  Employee compensation and
   benefits                           3,145    2,326    6,317    4,611
  Net occupancy expense                 928      610    1,765    1,194
  Equipment, net                        513      514    1,105      991
  Merger related expenses                --    1,256       --    1,258
  Other                               2,610    1,536    4,514    2,921
                                    -------  -------  -------  -------
     Total non-interest
      expense                         7,196    6,242   13,701   10,975

     Income (loss) before
      income taxes                      720   (1,368)   2,006     (121)
 Income tax (benefit) expense           (44)    (464)      99      (19)
                                    -------  -------  -------  -------
     Net income (loss)              $   764  $  (904) $ 1,907  $  (102)
                                    =======  =======  =======  =======

 Earnings (loss) per common
  share:
     Basic                          $  0.31  $ (0.36) $  0.76  $ (0.04)
                                    =======  =======  =======  =======
     Diluted                        $  0.30  $ (0.36) $  0.74  $ (0.04)
                                    =======  =======  =======  =======


                  CARVER BANCORP, INC. AND SUBSIDIARIES
                     CONSOLIDATED SELECTED KEY RATIOS
                               (Unaudited)

                         Three Months Ended       Six Months Ended
                            September 30,           September 30,
                       ----------------------  ----------------------
 Selected Statistical 
 Data:                    2007        2006        2007        2006
                       ----------  ----------  ----------  ----------

 Return on average
  assets (1)                 0.40%      -0.56%       0.51%      -0.03%
 Return on average
  equity (2)                 6.03%      -7.46%       7.62%      -0.42%
 Net interest
  margin (3)                 3.66%       3.46%       3.76%       3.37%
 Interest rate
  spread (4)                 3.38%       3.20%       3.46%       3.12%
 Efficiency ratio (5)       90.90%     128.07%      87.23%     101.11%
 Operating expenses to
  average assets (6)         3.78%       3.87%       3.64%       3.40%
 Average equity to
  average assets (7)         6.59%       7.98%       6.63%       7.45%

 Average interest-
  earning assets to
  average interest-
  bearing liabilities        1.09x       1.09x       1.09x       1.09x

 Net income per share
  - basic              $     0.31  $    (0.36) $     0.76  $    (0.04)
 Net income per share
  - diluted            $     0.30  $    (0.36) $     0.74  $    (0.04)

 Average shares
  outstanding
  - basic               2,490,045   2,509,088   2,497,666   2,507,466

 Average shares
  outstanding - 
  diluted               2,559,507   2,570,002   2,569,770   2,568,969
 Cash dividends        $     0.10  $     0.08  $     0.19  $     0.17
 Dividend payout
  ratio (8)                 32.46%        n/a       24.80%        n/a

 Capital Ratios:
 ---------------
   Tier I leverage
    capital ratio (9)        7.89%       7.24%       7.89%       7.24%
   Tier I risk-based
    capital ratio (9)        7.90%       8.96%       7.90%       8.96%
   Total risk-based
    capital ratio (9)       10.00%       9.79%      10.00%       9.79%

                            September 30,             March 31,
                       ----------------------  ----------------------
                          2007        2006        2007        2006
                       ----------  ----------  ----------  ----------
 Asset Quality Ratios:
 ---------------------
   Non performing assets 
    to total assets (10)     0.48%       0.50%       0.61%       0.42%
   Non performing loans 
    to total loans 
    receivable (10)          0.58%       0.57%       0.74%       0.55%
   Allowance for loan 
    losses to total 
    loans receivable         0.84%       0.88%       0.89%       0.81%
   Allowance for loan 
    losses to non-
    performing loans       146.21%     154.90%     119.93%     147.10%



 (1)   Net income, annualized, divided by average total assets.
 (2)   Net income, annualized, divided by average total equity.
 (3)   Net interest income, annualized, divided by average interest-
       earning assets.
 (4)   Combined weighted average interest rate earned less combined 
       weighted average interest rate cost.
 (5)   Operating expenses divided by sum of net interest income plus 
       non-interest income.
 (6)   Non-interest expenses, annualized, divided by average total 
       assets.
 (7)   Average equity divided by average assets for the period ended.
 (8)   Dividends paid on common stock during the period divided by 
       net income for the period.
 (9)   These ratios reflect consolidated bank only.
 (10)  Non performing assets consist of non-accrual loans, loans 
       accruing 90 days or more past due and real estate owned.


                         CARVER BANCORP, INC. AND SUBSIDIARIES
                             CONSOLIDATED AVERAGE BALANCES
                                    (In thousands)
                                     (Unaudited)

                       For the Three Months Ended September 30,
               -------------------------------------------------------
                           2007                        2006
               -------------------------    --------------------------
                                  Average                      Average
               Average             Yield/    Average            Yield/
               Balance   Interest   Cost     Balance  Interest   Cost
               --------  --------  -----    --------  --------  -----

 Interest
  Earning
  Assets:
 Loans (1)     $639,264  $ 11,184   7.00%   $507,492  $  8,317   6.56%
 Investment
  securities
  (2)            28,475       401   5.63%     16,086       168   4.18%
 Mortgage-
  backed
  securities     35,838       474   5.29%     79,578       842   4.23%
 Fed funds
  sold            2,171        29   5.36%      3,927        53   5.35%
               --------  --------  -----    --------  --------  -----
  Total
   interest-
   earning
   assets       705,748    12,088   6.85%    607,083     9,380   6.18%


 Non-interest
  -earning
  assets         55,964                       37,927
               --------                     --------
  Total
   assets      $761,712                     $645,010
               ========                     ========

 Interest
  Bearing
  Liabilities:
 Deposits:
  Now demand   $ 24,933  $     24   0.39%   $ 23,198  $     16   0.27%
  Savings
   and clubs    132,991       265   0.80%    135,629       220   0.64%
  Money market   45,529       258   2.27%     38,584       235   2.42%
  Certificates
   of deposit   361,231     4,014   4.46%    266,942     2,549   3.79%

  Mortgagors
   deposits       2,793         9   1.29%      1,571         6   1.52%
               --------  --------  -----    --------  --------  -----
  Total
   deposits     567,477     4,570   3.23%    465,924     3,026   2.58%

 Borrowed
  money          82,027     1,055   5.16%     89,531     1,143   5.06%
               --------  --------  -----    --------  --------  -----
  Total
   interest-
   bearing
   liabilities  649,504     5,625   3.47%    555,455     4,169   2.98%
                
 Non-interest
  -bearing
  liabilities:
  Demand         53,028                       31,977

  Other
   liabilities    9,006                        9,116
               --------                     --------
   Total
    liabil-
    ities       711,538                      596,548

 Stockholders'
  equity         50,174                       48,462
               --------                     --------
  Total
   liabilities
   &  
   stock-
   holders'
   equity      $761,712                     $645,010
               ========  --------           ========  --------
 Net interest
  income                 $  6,463                     $  5,211
                         ========                     ========

 Average
  interest
  rate spread                       3.38%                        3.20%
                                   =====                        =====

 Net interest
  margin                            3.66%                        3.46%
                                   =====                        =====

 (1) Includes non-accrual loans
 (2) Includes FHLB-NY stock



                 CARVER BANCORP, INC. AND SUBSIDIARIES
                    CONSOLIDATED AVERAGE BALANCES
                            (In thousands)
                              (Unaudited)

                           For the Six Months Ended September 30,
                     --------------------------------------------------
                               2007                     2006
                     -----------------------   ------------------------
                                       Average                  Average
                     Average           Yield/  Average           Yield/
                     Balance  Interest  Cost   Balance Interest  Cost
                     -------  -------- ------- ------- -------- -------
 Interest Earning
  Assets:
 Loans(1)            $628,677  $22,177  7.06%  $500,515  $16,208  6.48%
 Investment
  securities(2)        29,831      855  5.73%    16,887      349  4.13%
 Mortgage-backed
  securities           37,464      976  5.21%    85,723    1,775  4.14%
 Fed funds sold         1,555       41  5.29%     6,821      169  4.94%
                     --------  -------  -----  --------  -------  -----
   Total interest-
    earning assets    697,527   24,049  6.90%   609,946   18,501  6.07%
 Non-interest-earning
  assets               55,231                    37,673
                     --------                  --------
   Total assets      $752,758                  $647,619
                     ========                  ========

 Interest Bearing
  Liabilities:
 Deposits:
  Now demand         $ 24,951  $    58  0.47%  $ 24,943  $    39  0.31%
  Savings and clubs   135,120      530  0.79%   137,542      443  0.64%
  Money market         46,193      501  2.18%    39,164      477  2.43%
  Certificates of
   deposit            350,817    7,792  4.45%   264,516    5,048  3.81%
  Mortgagors deposits   2,807       20  1.43%     1,870       14  1.49%
                     --------  -------  -----  --------  -------  -----
   Total deposits     559,888    8,901  3.19%   468,035    6,021  2.57%
 Borrowed money        78,683    2,030  5.17%    89,708    2,233  4.96%
                     --------  -------  -----  --------  -------  -----
   Total interest-
    bearing
    liabilities       638,571   10,931  3.43%   557,743    8,254  2.95%
 Non-interest-bearing
  liabilities:
  Demand               53,809                    31,562
  Other liabilities    10,447                    10,075
                     --------                  --------
   Total liabilities  702,827                   599,380
 Stockholders' equity  49,931                    48,239
                     --------                  --------
   Total liabilities
    & stockholders'
    equity           $752,758                  $647,619
                     ========  -------         ========  -------
 Net interest income           $13,118                   $10,247
                               =======                   =======
 Average interest
  rate spread                           3.46%                     3.12%
                                        =====                     =====
 Net interest margin                    3.76%                     3.37%
                                        =====                     =====

 (1) Includes non-accrual loans
 (2) Includes FHLB-NY stock


            

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