Diluted Earnings per Share of 17 Cents
-- Real estate loan originations were $164.9 million at an average rate of 6.56%, compared to $111.0 million at an average interest rate of 6.59% during the quarter ended June 30, 2007. -- Real estate loans in the pipeline approximated $148.6 million at quarter-end, including commitments for sale to Fannie Mae of $15.1 million. -- The annualized loan amortization rate was 11%, compared to 10% during the previous quarter. Prepayment fee income was $727,000, compared to $934,000 in the June 2007 quarter and $1.3 million in the September 2006 quarter. -- Linked quarter average cost of deposits declined from 3.62% to 3.52%. -- Net interest margin was 2.28%, up slightly from 2.27% sequentially. -- The Company repurchased 742,640 shares of its common stock, compared to 819,526 shares repurchased in the June 2007 quarter. The consolidated tangible stockholders' equity ratio declined to 6.75% at September 30, 2007 from 7.06% at June 30, 2007. Year-to-date through September 30, 2007, the Company has repurchased 2.0 million shares, or 5.5% of its beginning shares outstanding, at an average price of $12.85 per share. -- Quarterly non-interest expense increased 5% sequentially due primarily to additional payroll expense.OPERATING RESULTS For the quarter ended September 30, 2007, the Company's pre-tax income, excluding gains and losses on the sale of assets, was $8.7 million, compared to $10.4 million in the same quarter of the previous year. The $1.7 million decrease was due to a decline of $1.3 million in net interest income, and an increase of $1.1 million in non-interest expense experienced primarily in salary, benefits and other compensation, which was partially offset by an increase of $696,000 in non-interest income due primarily to the non-recurring $546,000 BOLI settlement, and an increase of $164,000 in loan administration income. Pre-tax income, excluding gains and losses on the sale of assets, was $8.6 million during the June 2007 quarter. The $79,000 increase from the June 2007 quarter to the September 2007 quarter was primarily due to an increase of $888,000 in non-interest income (excluding gains or losses on the sale of assets), reflecting both the non-recurring BOLI settlement and an increase of $291,000 in loan administration fees. Partially offsetting this increase was a decline in net interest income of $291,000 that resulted principally from a decrease of $63.1 million in average interest earning assets during the period, and an increase of $518,000 in non-interest expense, due primarily to higher salary expense. The net interest margin contracted 25 basis points to 2.28% during the September 2007 quarter, from 2.53% during the September 2006 quarter, due primarily to an increase of 42 basis points in the average cost of deposits that reflected growth in deposit balances from successful promotional activities from October 2006 through June 2007. Excluding the effects of prepayment and late fee income, net interest income would have decreased $47,000 and the net interest margin would have increased 4 basis points during the quarter ended September 30, 2007 compared to the quarter ended June 30, 2007. During the three months ended September 30, 2007, management elected to utilize a portion of its liquid assets to fund operational needs and treasury stock repurchases. As a result, average interest earning assets declined $63.1 million from the June 2007 quarter to the September 2007 quarter, which led to a slight decline in interest income during the period despite higher average yields. The average yield on portfolio real estate loans, excluding the effects of prepayment and late fee income, was 5.84% during the quarter ended September 30, 2007 and 5.77% during the quarter ended June 30, 2007. Interest rates on newly originated real estate loans averaged 6.56% during the third quarter of 2007, compared to a weighted average rate on loans repaid of 6.00% during the period. Non-interest income, excluding gains or losses on the sale of assets, totaled $3.1 million during the quarter ended September 30, 2007, up $888,000 from the June 2007 quarter and $696,000 from the September 2006 quarter, due primarily to the aforementioned BOLI settlement and a loan administration fee that is collected in the third quarter of each year. The Company sold loans to Fannie Mae totaling $10.1 million, $17.0 million and $92.3 million, recording gains of $79,000, $223,000 and $779,000 during the quarters ended September 30, 2007, June 30, 2007 and September 30, 2006, respectively. Each of the loans sold during these periods was designated for sale upon origination. The loans sold during the quarter ended September 30, 2007 had a weighted average term to the earlier of maturity or next repricing of 9.0 years. Non-interest expense totaled $11.7 million during the quarter ended September 30, 2007, up $1.1 million from the September 2006 quarter and $518,000 from the June 2007 quarter. The growth in non-interest expense from the September 2006 quarter resulted primarily from an increase of $420,000 in salary and benefits, an additional $270,000 of compensation expense from the grant of equity awards to certain officers and outside directors in May 2007, and a combined increase of $240,000 in expenses related to advertising and regulatory compliance. The increase in non-interest expense from the June 2007 quarter resulted primarily from additional payroll expense during the September 2007 quarter. Non-interest expense to average assets was 1.45% in the September 2007 quarter, compared to 1.37% for the quarters ended both September 30, 2006 and June 30, 2007. The effective tax rate was 36.5% for the quarter ended September 30, 2007, 35.9% for the quarter ended September 30, 2006, and 35.8% for the quarter ended June 30, 2007. The increase in the effective tax rate resulted from an adjustment to the reserve for uncertain tax positions in accordance with Financial Accounting Standards Board Interpretation Number 48. The effective tax rate is expected to approximate 36.0% for the year ending December 31, 2007. REAL ESTATE LENDING AND CREDIT QUALITY Real estate loan originations totaled $164.9 million during the quarter ended September 30, 2007. The average rate on real estate loan originations during the quarter was 6.56%, compared to 6.58% during the quarter ended September 30, 2006 and 6.59% during the quarter ended June 30, 2007. Offering rates on multifamily loans closed during the quarter ended September 30, 2007 remained relatively constant while the benchmark treasury rates declined during the period, temporarily resulting in wider origination spreads. Those spreads narrowed in recent weeks as some of the pricing leaders appear to be reducing offering rates on certain multifamily residential loan products. Real estate loan prepayments and amortization during the September 2007 quarter approximated 11% of the real estate loan portfolio on an annualized basis, compared to 15% during the September 2006 quarter and 10% during the June 2007 quarter. Non-performing loans were $1.8 million at September 30, 2007, representing only 0.06% of total loans, down from 0.11% at June 30, 2007. DEPOSITS Deposits decreased $121.7 million from June 30, 2007 to September 30, 2007. Core (non-certificate) deposits declined $62.1 million and certificates of deposit declined by $59.7 million. The market price for consumer deposits experienced significant volatility during the third quarter of 2007, driven by the recent liquidity crisis. Dime used its liquidity on hand and FHLBNY Advances to maintain price discipline during this period, managing to reduce deposit cost of funds by 10 basis points as compared to the previous quarter. This pricing discipline resulted in a net decrease of $121.7 million in deposits during the third quarter of 2007. Several categories of deposit accounts, including Checking, Money Market, and Certificates, experienced year-to-date annualized growth rates in non-promotional balances of 7.7%, 27.8%, and 18.0%, respectively, during the first nine months of 2007 as a result of successful retention efforts. Mr. Palagiano commented, "The goal of our rebranding initiative and the launch of Prime Dime Banking is to enable us to migrate promotional deposits, upon completion of the promotional period, into non-promotional, relationship-based retail accounts. Dime plans to continue to use promotional deposit pricing as a cost-efficient way to attract new households to the Bank." Average deposits per branch approximated $99 million at September 30, 2007, up from $92 million at September 30, 2006, and down from $105 million at June 30, 2007. Core deposits comprised 51% of total deposits at September 30, 2007, relatively unchanged from June 30, 2007 and up from 47% at September 30, 2006 (reflecting growth of $160.9 million in money market accounts during the twelve months ended September 30, 2007). The loan-to-deposit ratio was 137% at September 30, 2007, compared to 137% at September 30, 2006 and 126% at June 30, 2007. STOCKHOLDERS' EQUITY AND SHARE REPURCHASE PROGRAM The Company's total stockholders' equity at September 30, 2007 was $270.0 million, or 8.18% of total assets, compared to $275.2 million, or 8.47% of total assets, at June 30, 2007. The decline in stockholders' equity as a percentage of assets resulted from an increase of $51.1 million in period-end assets coupled with $9.0 million in treasury stock repurchases during the period . During the third quarter of 2007, the Company repurchased into treasury 742,640 shares, or 2.1%, of its common stock outstanding at June 30, 2007. As of September 30, 2007, the Company had an additional 1,486,651 shares remaining eligible for repurchase under its twelfth stock repurchase program, approved in June 2007. After outlays for dividends paid to shareholders and share repurchases, by the end of the third quarter of 2007 the Company's tangible stockholders' equity had declined to $219.9 million, compared to $226.4 million at June 30, 2007. The quarterly cash dividend paid in August 2007 represented a payout ratio of 82.0% of third quarter 2007 earnings. At September 30, 2007, tangible stockholders' equity was 6.75% of tangible assets and the tangible book value per share was $6.43. For the quarter ended September 30, 2007, the return on average stockholders' equity was 8.20%, the return on average tangible equity was 10.04%, and the cash return on average tangible equity was 10.98%. OUTLOOK At present, the overall yield on the Company's interest-earning assets is rising. The average yield on interest-earning assets, excluding the effects of prepayment and late fee income, rose on a linked quarter basis, from 5.69% to 5.78%. This trend appears likely to continue, as $390 million in portfolio mortgage loans with a below current market weighted average coupon of 5.37% contractually reprice or mature between October 1, 2007 and December 31, 2008. During the year ending December 31, 2009, an additional $366 million in mortgage loans with a weighted average coupon of 5.38% are scheduled to reprice. These loan repricings and maturities provide a potentially significant boost to overall portfolio yields. The average cost of deposits declined from 3.62% during the June 30, 2007 quarter to 3.52% during the September 2007 quarter. During the remainder of 2007, average deposit costs are expected to remain relatively stable, as maturing accounts that are anticipated to re-price at lower rates are expected to be offset by new promotional accounts. Prepayment and amortization rates, which approximated 10.5% during the first nine months of 2007, are expected to remain in the 10% to 12% range during the remainder of 2007. At September 30, 2007, the real estate loan commitment pipeline approximated $148.6 million, including $15.1 million of loan commitments intended for sale to Fannie Mae. The real estate loan pipeline had a weighted average interest rate approximating 6.2% at September 30, 2007, lower than the loan origination rate of 6.56% experienced during the third quarter. We would need to see more steepness in the yield curve, mainly represented by a reduction in short-term rates, before we would see a significant increase in the net interest margin, and there remains a great deal of uncertainty about Federal Open Market Committee ("FOMC") moves in the near term. Since the Bank's interest bearing liabilities traditionally reprice faster than its interest earning assets, further reductions in short-term interest rates would have a meaningful positive impact on earnings. Operating expenses are expected to approximate $11.5 million in the fourth quarter of 2007. The Company is positioned to be opportunistic in the purchase of its own shares should conditions warrant. Based on an outlook of little or no change in FOMC monetary policy over the next quarter, the Company expects fourth quarter 2007 earnings per diluted share to again be in the range of $0.15 to $0.17. ABOUT DIME COMMUNITY BANCSHARES The Company (
DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (In thousands except share amounts) September 30, 2007 December 31, (Unaudited) 2006 ------------- ------------- ASSETS: Cash and due from banks $ 35,739 $ 26,264 Investment securities held to maturity 160 235 Investment securities available for sale 34,591 29,548 Mortgage-backed securities available for sale 169,908 154,437 Federal funds sold and other short-term investments 35,224 78,752 Real Estate Loans: One-to-four family and cooperative apartment 148,145 153,847 Multifamily and underlying cooperative 1,927,307 1,855,106 Commercial real estate 711,574 666,927 Construction and land acquisition 47,261 23,340 Unearned discounts and net deferred loan fees 1,536 1,048 ------------- ------------- Total real estate loans 2,835,823 2,700,268 ------------- ------------- Other loans 2,096 2,205 Allowance for loan losses (15,374) (15,514) ------------- ------------- Total loans, net 2,822,545 2,686,959 ------------- ------------- Loans held for sale - 1,200 Premises and fixed assets, net 23,625 22,886 Federal Home Loan Bank of New York capital stock 33,629 31,295 Goodwill 55,638 55,638 Other assets 90,413 86,163 ------------- ------------- TOTAL ASSETS $ 3,301,472 $ 3,173,377 ============= ============= LIABILITIES AND STOCKHOLDERS' EQUITY: Deposits: Non-interest bearing checking $ 90,720 $ 95,215 NOW, Super NOW and Interest Bearing Checking 47,642 35,519 Savings 277,650 298,522 Money Market 631,478 514,607 ------------- ------------- Sub-total $ 1,047,490 $ 943,863 ------------- ------------- Certificates of deposit 1,026,530 1,064,669 ------------- ------------- Total Due to Depositors 2,074,020 2,008,532 ------------- ------------- Escrow and other deposits 72,572 46,373 Securities sold under agreements to repurchase 155,160 120,235 Federal Home Loan Bank of New York advances 586,500 571,500 Subordinated Notes Sold 25,000 25,000 Trust Preferred Notes Payable 72,165 72,165 Other liabilities 46,007 38,941 ------------- ------------- TOTAL LIABILITIES 3,031,424 2,882,746 ------------- ------------- STOCKHOLDERS' EQUITY: Common stock ($0.01 par, 125,000,000 shares authorized, 50,904,028 shares and 50,862,867 shares issued at September 30, 2007 and December 31, 2006, respectively, and 34,218,754 shares and 36,456,354 shares outstanding at September 30, 2007 and December 31, 2006, respectively) 509 509 Additional paid-in capital 207,896 206,601 Retained earnings 287,253 285,420 Unallocated common stock of Employee Stock Ownership Plan (4,222) (4,395) Unearned common stock of Recognition and Retention Plan (741) (3,452) Common stock held by the Benefit Maintenance Plan (7,941) (7,941) Treasury stock (16,685,274 shares and 14,406,513 shares at September 30, 2007 and December 31, 2006, respectively) (207,005) (179,011) Accumulated other comprehensive loss, net (5,701) (7,100) ------------- ------------- TOTAL STOCKHOLDERS' EQUITY 270,048 290,631 ------------- ------------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 3,301,472 $ 3,173,377 ============= ============= DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS (Dollars In thousands except per share amounts) For the Three Months Ended September June September 30, 30, 30, ---------- ---------- ---------- 2007 2007 2006 ---------- ---------- ---------- Interest income: Loans secured by real estate $ 41,420 $ 40,697 $ 39,122 Other loans 45 42 47 Mortgage-backed securities 1,588 1,435 1,666 Investment securities 374 377 454 Federal funds sold and other short-term investments 1,474 2,793 1,384 ---------- ---------- ---------- Total interest income 44,901 45,344 42,673 ---------- ---------- ---------- Interest expense: Deposits and escrow 18,919 19,576 15,019 Borrowed funds 8,604 8,099 8,948 ---------- ---------- ---------- Total interest expense 27,523 27,675 23,967 ---------- ---------- ---------- Net interest income 17,378 17,669 18,706 Provision for loan losses 60 60 60 ---------- ---------- ---------- Net interest income after provision for loan losses 17,318 17,609 18,646 ---------- ---------- ---------- Non-interest income: Service charges and other fees 1,609 1,282 1,507 Net gain on sales and redemptions of assets 79 223 779 Other 1,443 882 849 ---------- ---------- ---------- Total non-interest income 3,131 2,387 3,135 ---------- ---------- ---------- Non-interest expense: Compensation and benefits 6,667 6,198 6,006 Occupancy and equipment 1,566 1,512 1,504 Other 3,484 3,489 3,110 ---------- ---------- ---------- Total non-interest expense 11,717 11,199 10,620 ---------- ---------- ---------- Income before taxes 8,732 8,797 11,161 Income tax expense 3,188 3,152 4,002 ---------- ---------- ---------- Net Income $ 5,544 $ 5,645 $ 7,159 ========== ========== ========== Earnings per Share: Basic $ 0.17 $ 0.17 $ 0.21 ========== ========== ========== Diluted $ 0.17 $ 0.17 $ 0.20 ========== ========== ========== Average common shares outstanding for Diluted EPS 33,106,224 34,123,887 35,028,903 For the Nine Months Ended September September 30, 30, ---------- ---------- 2007 2006 ---------- ---------- Interest income: Loans secured by real estate $ 122,367 $ 116,805 Other loans 132 141 Mortgage-backed securities 4,535 5,264 Investment securities 1,194 1,405 Federal funds sold and other short-term investments 6,736 4,062 ---------- ---------- Total interest income 134,964 127,677 ---------- ---------- Interest expense: Deposits and escrow 56,657 40,069 Borrowed funds 25,375 27,610 ---------- ---------- Total interest expense 82,032 67,679 ---------- ---------- Net interest income 52,932 59,998 Provision for loan losses 180 180 ---------- ---------- Net interest income after provision for loan losses 52,752 59,818 ---------- ---------- Non-interest income: Service charges and other fees 4,247 4,461 Net gain on sales and redemptions of assets 546 2,973 Other 3,216 2,554 ---------- ---------- Total non-interest income 8,009 9,988 ---------- ---------- Non-interest expense: Compensation and benefits 19,316 17,678 Occupancy and equipment 4,572 4,295 Other 10,276 9,623 ---------- ---------- Total non-interest expense 34,164 31,596 ---------- ---------- Income before taxes 26,597 38,210 Income tax expense 9,591 13,583 ---------- ---------- Net Income $ 17,006 $ 24,627 ========== ========== Earnings per Share: Basic $ 0.50 $ 0.70 ========== ========== Diluted $ 0.50 $ 0.70 ========== ========== Average common shares outstanding for Diluted EPS 33,946,319 35,200,367 DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES Core Earnings and Core Cash Earnings Reconciliations (Dollars In thousands except per share amounts) Core earnings and related data are "Non-GAAP Disclosures." These disclosures present information which management considers useful to the readers of this report since they present a measure of the results of the Company's ongoing operations (exclusive of significant non-recurring items such as gains or losses on sales of investment or mortgage-backed securities) during the period. Core cash earnings and related data are also "Non-GAAP Disclosures." These disclosures present information which management considers useful to the readers of this report since they present a measure of the tangible equity generated from operations during each period presented. Tangible stockholders' equity is derived from stockholders' equity, with various adjustment items that are based upon standards of the Company's primary regulator, the Office of Thrift Supervision. Tangible stockholders' equity generation is a significant financial measure since banks are subject to regulatory requirements involving the maintenance of minimum tangible capital levels. A reconciliation between GAAP and tangible stockholders' equity can be found in the Company's audited financial statements for the year ended December 31, 2006. The following tables present a reconciliation of GAAP net income and both core earnings and core cash earnings, as well as financial performance ratios determined based upon core earnings and core cash earnings, for each of the periods presented: For the Three Months Ended ------------------------------------- September June September 30, 30, 30, 2007 2007 2006 ----------- ----------- ----------- Net income as reported $ 5,544 $ 5,645 $ 7,159 Pre-tax net (gain) loss on sale of securities and other assets - - Pre-tax income from life insurance contract settlement (546) Pre-tax income from borrowings restructuring - - (764) Tax effect of adjustments - - 271 ----------- ----------- ----------- Core Earnings $ 4,998 $ 5,645 $ 6,666 ----------- ----------- ----------- Cash Earnings Additions : Non-cash stock benefit plan expense 519 466 342 ----------- ----------- ----------- Core Cash Earnings $ 5,517 $ 6,111 $ 7,008 ----------- ----------- ----------- Performance Ratios (Based upon Core Cash Earnings): Core Cash EPS (Diluted) $ 0.17 $ 0.18 $ 0.20 Core Cash Return on Average Assets 0.68% 0.75% 0.90% Core Cash Return on Average Tangible Stockholders' Equity 9.99% 10.58% 11.55% For the Nine Months Ended ------------------------- September September 30, 30, 2007 2006 ----------- ----------- Net income as reported $ 17,006 $ 24,627 Pre-tax net (gain) loss on sale of securities and other assets - (1,542) Pre-tax income from life insurance contract settlement (546) Pre-tax income from borrowings restructuring - (807) Tax effect of adjustments - 839 ----------- ----------- Core Earnings $ 16,460 $ 23,117 ----------- ----------- Cash Earnings Additions : Non-cash stock benefit plan expense 1,314 1,067 ----------- ----------- Core Cash Earnings $ 17,774 $ 24,184 ----------- ----------- Performance Ratios (Based upon Core Cash Earnings): Core Cash EPS (Diluted) $ 0.52 $ 0.69 Core Cash Return on Average Assets 0.73% 1.03% Core Cash Return on Average Tangible Stockholders' Equity 10.30% 13.38% DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES UNAUDITED SELECTED FINANCIAL HIGHLIGHTS (Dollars In thousands except per share amounts) For the Three Months Ended ------------------------------------- September 30, June 30, September 30, 2007 2007 2006 ----------- ----------- ----------- Performance Ratios (Based upon Reported Earnings): Reported EPS (Diluted) $ 0.17 $ 0.17 $ 0.20 Return on Average Assets 0.69% 0.69% 0.92% Return on Average Stockholders' Equity 8.20% 8.06% 9.73% Return on Average Tangible Stockholders' Equity 10.04% 9.77% 11.80% Net Interest Spread 1.92% 1.81% 2.16% Net Interest Margin 2.28% 2.27% 2.53% Non-interest Expense to Average Assets 1.45% 1.37% 1.37% Efficiency Ratio 57.35% 56.47% 50.42% Effective Tax Rate 36.51% 35.83% 35.86% Performance Ratios (Based upon Core Earnings): Core EPS (Diluted) $ 0.15 $ 0.17 $ 0.19 Core Return on Average Assets 0.62% 0.69% 0.86% Core Return on Average Stockholders' Equity 7.39% 8.06% 9.06% Core Return on Average Tangible Stockholders' Equity 9.05% 9.77% 10.99% Book Value and Tangible Book Value Per Share: Stated Book Value Per Share $ 7.89 $ 7.81 $ 8.07 Tangible Book Value Per Share 6.43 6.42 6.64 Average Balance Data: Average Assets $ 3,224,578 $ 3,267,736 $ 3,107,482 Average Interest Earning Assets 3,054,499 3,117,578 2,960,468 Average Stockholders' Equity 270,350 280,282 294,305 Average Tangible Stockholders' Equity 220,915 231,127 242,658 Average Loans 2,786,862 2,752,200 2,656,014 Average Deposits 2,130,472 2,166,907 1,920,069 Asset Quality Summary: Net charge-offs (recoveries) $ 7 $ (1) $ 0 Nonperforming Loans 1,792 2,937 2,889 Nonperforming Loans/Total Loans 0.06% 0.11% 0.11% Nonperforming Assets/Total Assets 0.05% 0.09% 0.09% Allowance for Loan Loss/Total Loans 0.54% 0.56% 0.60% Allowance for Loan Loss/Nonperforming Loans 857.92% 524.51% 552.30% Regulatory Capital Ratios: Consolidated Tangible Stockholders' Equity to Tangible Assets at period end 6.75% 7.06% 7.88% Tangible Capital Ratio (Bank Only) 8.75% 9.13% 9.64% Leverage Capital Ratio (Bank Only) 8.75% 9.13% 9.64% Risk Based Capital Ratio (Bank Only) 12.65% 12.83% 13.61% For the Nine Months Ended -------------------------- September 30, September 30, 2007 2006 ----------- ----------- Performance Ratios (Based upon Reported Earnings): Reported EPS (Diluted) $ 0.50 $ 0.70 Return on Average Assets 0.70% 1.05% Return on Average Stockholders' Equity 8.13% 11.21% Return on Average Tangible Stockholders' Equity 9.86% 13.63% Net Interest Spread 1.86% 2.29% Net Interest Margin 2.29% 2.69% Non-interest Expense to Average Assets 1.41% 1.35% Efficiency Ratio 56.57% 47.15% Effective Tax Rate 36.06% 35.55% Performance Ratios (Based upon Core Earnings): Core EPS (Diluted) $ 0.48 $ 0.66 Core Return on Average Assets 0.68% 0.99% Core Return on Average Stockholders' Equity 7.87% 10.53% Core Return on Average Tangible Stockholders' Equity 9.54% 12.79% Book Value and Tangible Book Value Per Share: Stated Book Value Per Share $ 7.89 $ 8.07 Tangible Book Value Per Share 6.43 6.64 Average Balance Data: Average Assets $ 3,235,546 $ 3,120,371 Average Interest Earning Assets 3,080,412 2,973,272 Average Stockholders' Equity 279,014 292,805 Average Tangible Stockholders' Equity 230,057 240,967 Average Loans 2,749,274 2,647,969 Average Deposits 2,126,957 1,920,958 Asset Quality Summary: Net charge-offs (recoveries) $ 4 $ 19 Nonperforming Loans 1,792 2,889 Nonperforming Loans/Total Loans 0.06% 0.11% Nonperforming Assets/Total Assets 0.05% 0.09% Allowance for Loan Loss/Total Loans 0.54% 0.60% Allowance for Loan Loss/Nonperforming Loans 857.92% 552.30% Regulatory Capital Ratios: Consolidated Tangible Stockholders' Equity to Tangible Assets at period end 6.75% 7.88% Tangible Capital Ratio (Bank Only) 8.75% 9.64% Leverage Capital Ratio (Bank Only) 8.75% 9.64% Risk Based Capital Ratio (Bank Only) 12.65% 13.61% DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES AVERAGE BALANCES AND NET INTEREST INCOME (Dollars In thousands) For the Three Months Ended ----------------------------------- September 30, 2007 ---------------------------------- Average Average Yield/ Balance Interest Cost ---------------------------------- (Dollars In Thousands) Assets: Interest-earning assets: Real estate loans $ 2,785,057 $ 41,420 5.95% Other loans 1,805 45 9.97 Mortgage-backed securities 153,738 1,588 4.13 Investment securities 22,921 374 6.53 Other short-term investments 90,978 1,474 6.48 ----------- ---------- ---------- Total interest earning assets 3,054,499 $ 44,901 5.88% ----------- ---------- Non-interest earning assets 170,079 ----------- Total assets $ 3,224,578 =========== Liabilities and Stockholders' Equity: Interest-bearing liabilities: NOW, Super NOW and Interest Bearing Checking $ 45,609 $ 220 1.91% Money Market accounts 654,192 6,348 3.85 Savings accounts 284,366 388 0.54 Certificates of deposit 1,053,972 11,963 4.50 ----------- ---------- ---------- Total interest bearing deposits 2,038,139 18,919 3.68 Borrowed Funds 717,926 8,604 4.75 ----------- ---------- ---------- Total interest-bearing liabilities 2,756,065 27,523 3.96% ----------- ---------- Non-interest bearing checking accounts 92,333 Other non-interest-bearing liabilities 105,830 ----------- Total liabilities 2,954,228 Stockholders' equity 270,350 ----------- Total liabilities and stockholders' equity $ 3,224,578 =========== Net interest income $ 17,378 ========== Net interest spread 1.92% ========== Net interest-earning assets $ 298,434 =========== Net interest margin 2.28% ========== Ratio of interest-earning assets to interest-bearing liabilities 110.83% ========== Deposits (including non-interest bearing checking accounts) $ 2,130,472 $ 18,919 3.52% Interest earning assets (excluding prepayment fees and late charges) 5.78% For the Three Months Ended ----------------------------------- June 30, 2007 ---------------------------------- Average Average Yield/ Balance Interest Cost ---------------------------------- (Dollars In Thousands) Assets: Interest-earning assets: Real estate loans $ 2,750,429 $ 40,697 5.92% Other loans 1,771 42 9.49 Mortgage-backed securities 146,181 1,435 3.93 Investment securities 25,534 377 5.91 Other short-term investments 193,663 2,793 5.77 ----------- ---------- ---------- Total interest earning assets 3,117,578 $ 45,344 5.82% ----------- ---------- Non-interest earning assets 150,158 ----------- Total assets $ 3,267,736 =========== Liabilities and Stockholders' Equity: Interest-bearing liabilities: NOW, Super NOW and Interest Bearing Checking $ 42,705 $ 186 1.75% Money Market accounts 636,893 6,103 3.84 Savings accounts 293,759 449 0.61 Certificates of deposit 1,097,137 12,838 4.69 ----------- ---------- ---------- Total interest bearing deposits 2,070,494 19,576 3.79 Borrowed Funds 698,765 8,099 4.65 ----------- ---------- ---------- Total interest-bearing liabilities 2,769,259 27,675 4.01% ----------- ---------- Non-interest bearing checking accounts 96,413 Other non-interest-bearing liabilities 121,782 ----------- Total liabilities 2,987,454 Stockholders' equity 280,282 ----------- Total liabilities and stockholders' equity $ 3,267,736 =========== Net interest income $ 17,669 ========== Net interest spread 1.81% ========== Net interest-earning assets $ 348,319 =========== Net interest margin 2.27% ========== Ratio of interest-earning assets to interest-bearing liabilities 112.58% ========== Deposits (including non-interest bearing checking accounts) $ 2,166,907 $ 19,576 3.62% Interest earning assets (excluding prepayment fees and late charges) 5.69% For the Three Months Ended ----------------------------------- September 30, 2006 ---------------------------------- Average Average Yield/ Balance Interest Cost ---------------------------------- (Dollars In Thousands) Assets: Interest-earning assets: Real estate loans $ 2,654,055 $ 39,122 5.90% Other loans 1,959 47 9.60 Mortgage-backed securities 172,116 1,666 3.87 Investment securities 31,406 454 5.78 Other short-term investments 100,932 1,384 5.48 ----------- ---------- ---------- Total interest earning assets 2,960,468 $ 42,673 5.77% ----------- ---------- Non-interest earning assets 147,014 ----------- Total assets $ 3,107,482 =========== Liabilities and Stockholders' Equity: Interest-bearing liabilities: NOW, Super NOW and Interest Bearing Checking $ 33,814 $ 85 1.00% Money Market accounts 455,629 3,228 2.81 Savings accounts 312,891 493 0.63 Certificates of deposit 1,023,738 11,213 4.35 ----------- ---------- ---------- Total interest bearing deposits 1,826,072 15,019 3.26 Borrowed Funds 808,278 8,948 4.39 ----------- ---------- ---------- Total interest-bearing liabilities 2,634,350 23,967 3.61% ----------- ---------- Non-interest bearing checking accounts 93,989 Other non-interest-bearing liabilities 84,838 ----------- Total liabilities 2,813,177 Stockholders' equity 294,305 ----------- Total liabilities and stockholders' equity $ 3,107,482 =========== Net interest income $ 18,706 ========== Net interest spread 2.16% ========== Net interest-earning assets $ 326,118 =========== Net interest margin 2.53% ========== Ratio of interest-earning assets to interest-bearing liabilities 112.38% ========== Deposits (including non-interest bearing checking accounts) $ 1,920,061 $ 15,019 3.10% Interest earning assets (excluding prepayment fees and late charges) 5.60%
Contact Information: Contact: Kenneth Ceonzo Director of Investor Relations 718-782-6200 extension 8279