Astorial Financial (AF) in Lake Success, N.Y., reported higher quarterly profits because of improved credit quality.
The $15.8 billion-asset company's earnings rose 7% from a year earlier, to $18 million. At 18 cents, earnings per share were 3 cents higher than the average estimate of analysts polled by Bloomberg.
Astoria's net interest income fell less than 1% from a year earlier, to $86.8 million. Declines in income from residential mortgages were partially offset by lower funding costs and an uptick in revenue from multi-family and commercial real estate mortgage. The net interest margin widened by 10 basis points from a year earlier, to 2.21%.
Noninterest income plummeted 19% from a year, to $17.4 million. Astoria said the decline was because of a decrease in securities gains. An increase in mortgage banking income, including a $2.3 million partial recovery of the mortgage-servicing rights valuation allowance, helped counter the downturn in noninterest income.
General and administrative expenses for the quarter fell 6% from a year earlier, to $69 million. The lower expenses were because of a decline in Federal Deposit Insurance Corp. premium expense and decreased advertising costs.
Astoria's loan-loss provision fell by 68% from a year earlier, to $3.4 million, and net loan chargeoffs fell 47%, to $7.4 million.