10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2013

OR

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from         to        

Commission file number 001-11967

ASTORIA FINANCIAL CORPORATION

(Exact name of registrant as specified in its charter)

Delaware	11-3170868
(State or other jurisdiction of	(I.R.S. Employer Identification
incorporation or organization)	Number)

One Astoria Federal Plaza, Lake Success, New York	11042-1085
(Address of principal executive offices)	(Zip Code)

(516) 327-3000

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all the reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES  x NO  o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). YES  x NO  o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company (as these items are defined in Rule 12b-2 of the Exchange Act).

Large accelerated filer x Accelerated filer o Non-accelerated filer o Smaller reporting company o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  YES  o  NO  x

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Classes of Common Stock	Number of Shares Outstanding, October 30, 2013
$0.01 Par Value	98,865,122

		Page
PART I — FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited):
	Consolidated Statements of Financial Condition at September 30, 2013 and December 31, 2012	2
	Consolidated Statements of Income for the Three and Nine Months Ended September 30, 2013 and 2012	3
	Consolidated Statements of Comprehensive Income for the Three and Nine Months Ended September 30, 2013 and 2012	4
	Consolidated Statement of Changes in Stockholders’ Equity for the Nine Months Ended September 30, 2013	5
	Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2013 and 2012	6
	Notes to Consolidated Financial Statements	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	33
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	75
Item 4.	Controls and Procedures	78
PART II — OTHER INFORMATION
Item 1.	Legal Proceedings	78
Item 1A.	Risk Factors	79
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	80
Item 3.	Defaults Upon Senior Securities	80
Item 4.	Mine Safety Disclosures	80
Item 5.	Other Information	80
Item 6.	Exhibits	80
Signatures		81

1

ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES

Consolidated Statements of Financial Condition

	(Unaudited)
(In Thousands, Except Share Data)	At September 30, 2013			At December 31, 2012
Assets:
Cash and due from banks	$	137,737		$	121,473
Available-for-sale securities:
Encumbered	108,640			79,851
Unencumbered	307,110			256,449
Total available-for-sale securities	415,750			336,300
Held-to-maturity securities, fair value of $1,896,771 and $1,725,090, respectively:
Encumbered	1,133,176			1,133,193
Unencumbered	782,285			566,948
Total held-to-maturity securities	1,915,461			1,700,141
Federal Home Loan Bank of New York stock, at cost	153,217			171,194
Loans held-for-sale, net	10,485			76,306
Loans receivable	12,541,543			13,223,972
Allowance for loan losses	(143,000		)	(145,501		)
Loans receivable, net	12,398,543			13,078,471
Mortgage servicing rights, net	10,835			6,947
Accrued interest receivable	39,650			41,688
Premises and equipment, net	113,075			115,632
Goodwill	185,151			185,151
Bank owned life insurance	421,182			418,155
Real estate owned, net	34,983			28,523
Other assets	186,020			216,661
Total assets	$	16,022,089		$	16,496,642
Liabilities:
Deposits:
Savings	$	2,562,927		$	2,802,298
Money market	1,913,607			1,586,556
NOW and demand deposit	2,133,062			2,094,733
Certificates of deposit	3,450,778			3,960,371
Total deposits	10,060,374			10,443,958
Federal funds purchased	285,000			—
Reverse repurchase agreements	1,100,000			1,100,000
Federal Home Loan Bank of New York advances	2,476,000			2,897,000
Other borrowings, net	248,028			376,496
Mortgage escrow funds	137,248			113,101
Accrued expenses and other liabilities	257,523			272,098
Total liabilities	14,564,173			15,202,653
Stockholders’ Equity:
Preferred stock, $1.00 par value; 5,000,000 shares authorized;
Series C (150,000 shares authorized; and 135,000 and -0- shares issued and outstanding, respectively)	129,796			—
Common stock, $0.01 par value (200,000,000 shares authorized; 166,494,888 shares issued; and 98,865,122 and 98,419,318 shares outstanding, respectively)	1,665			1,665
Additional paid-in capital	889,546			884,689
Retained earnings	1,915,736			1,891,022
Treasury stock (67,629,766 and 68,075,570 shares, at cost, respectively)	(1,397,543		)	(1,406,755		)
Accumulated other comprehensive loss	(80,454		)	(73,090		)
Unallocated common stock held by ESOP (226,735 and 967,013 shares, respectively)	(830		)	(3,542		)
Total stockholders’ equity	1,457,916			1,293,989
Total liabilities and stockholders’ equity	$	16,022,089		$	16,496,642

See accompanying Notes to Consolidated Financial Statements.

2

ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES

Consolidated Statements of Income (Unaudited)

	For the				For the
	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(In Thousands, Except Share Data)	2013		2012		2013		2012
Interest income:
Residential mortgage loans	$	69,158	$	91,490	$	222,994	$	286,236
Multi-family and commercial real estate mortgage loans	41,450		38,127		120,463		111,088
Consumer and other loans	2,175		2,309		6,611		6,944
Mortgage-backed and other securities	13,247		14,453		36,003		49,445
Repurchase agreements and interest-earning cash accounts	67		182		192		282
Federal Home Loan Bank of New York stock	1,498		1,773		5,147		4,928
Total interest income	127,595		148,334		391,410		458,923
Interest expense:
Deposits	15,156		22,119		48,166		78,479
Borrowings	26,235		40,217		88,107		119,581
Total interest expense	41,391		62,336		136,273		198,060
Net interest income	86,204		85,998		255,137		260,863
Provision for loan losses	2,541		9,500		16,193		29,500
Net interest income after provision for loan losses	83,663		76,498		238,944		231,363
Non-interest income:
Customer service fees	9,550		10,487		27,718		30,480
Other loan fees	598		545		1,588		1,937
Gain on sales of securities	—		—		2,057		2,477
Mortgage banking income, net	1,888		2,015		10,060		5,147
Income from bank owned life insurance	1,972		2,446		6,211		7,073
Other	1,301		1,081		4,535		4,478
Total non-interest income	15,309		16,574		52,169		51,592
Non-interest expense:
General and administrative:
Compensation and benefits	33,879		30,758		99,262		105,060
Occupancy, equipment and systems	17,022		16,758		53,669		49,992
Federal deposit insurance premiums	9,166		12,533		28,359		35,600
Advertising	2,074		1,811		6,225		5,624
Extinguishment of debt	—		1,212		4,266		1,212
Other	10,393		9,571		26,701		29,455
Total non-interest expense	72,534		72,643		218,482		226,943
Income before income tax expense	26,438		20,429		72,631		56,012
Income tax expense	9,514		7,074		26,190		19,837
Net income	16,924		13,355		46,441		36,175
Preferred stock dividends	2,194		—		5,021		—
Net income available to common shareholders	$	14,730	$	13,355	$	41,420	$	36,175
Basic earnings per common share	$	0.15	$	0.14	$	0.42	$	0.38
Diluted earnings per common share	$	0.15	$	0.14	$	0.42	$	0.38
Basic weighted average common shares outstanding	97,199,329		95,555,816		96,967,052		95,303,453
Diluted weighted average common shares outstanding	97,199,329		95,555,816		96,967,052		95,303,453

See accompanying Notes to Consolidated Financial Statements.

3

ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES

Consolidated Statements of Comprehensive Income (Unaudited)

	For the						For the
	Three Months Ended						Nine Months Ended
	September 30,						September 30,
(In Thousands)	2013			2012			2013			2012
Net income	$	16,924		$	13,355		$	46,441		$	36,175
Other comprehensive (loss) income, net of tax:
Net unrealized loss on securities available-for-sale:
Net unrealized holding loss on securities arising during the period	(1,286		)	(3,796		)	(7,889		)	(3,194		)
Reclassification adjustment for gain on sales of securities included in net income	—			—			(1,332		)	(1,604		)
Net unrealized loss on securities available-for-sale	(1,286		)	(3,796		)	(9,221		)	(4,798		)
Net actuarial loss adjustment on pension plans and other postretirement benefits:
Net actuarial loss adjustment arising during the period	—			—			—			24,286
Reclassification adjustment for net actuarial loss included in net income	585			448			1,754			3,077
Net actuarial loss adjustment on pension plans and other postretirement benefits	585			448			1,754			27,363
Prior service cost adjustment on pension plans and other postretirement benefits:
Prior service cost adjustment arising during the period	—			—			—			(3,537		)
Reclassification adjustment for prior service cost included in net income	34			32			103			67
Prior service cost adjustment on pension plans and other postretirement benefits	34			32			103			(3,470		)
Reclassification adjustment for loss on cash flow hedge included in net income	—			56			—			151
Total other comprehensive (loss) income, net of tax	(667		)	(3,260		)	(7,364		)	19,246
Comprehensive income	$	16,257		$	10,095		$	39,077		$	55,421

See accompanying Notes to Consolidated Financial Statements.

4

ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES

Consolidated Statement of Changes in Stockholders’ Equity (Unaudited)

For the Nine Months Ended September 30, 2013

											Accumulated		Unallocated
					Additional						Other		Common
			Preferred	Common	Paid-in		Retained		Treasury		Comprehensive		Stock Held
(In Thousands, Except Share Data)	Total		Stock	Stock	Capital		Earnings		Stock		Loss		by ESOP
Balance at December 31, 2012	$1,293,989		$—	$1,665	$884,689		$1,891,022		$(1,406,755	)	$(73,090	)	$(3,542	)
Net income	46,441		—	—	—		46,441		—		—		—
Other comprehensive loss, net of tax	(7,364	)	—	—	—		—		—		(7,364	)	—
Issuance of Preferred Stock, Series C (135,000 shares)	129,796		129,796	—	—		—		—		—		—
Dividends on common stock ($0.12 per share)	(11,750	)	—	—	—		(11,750	)	—		—		—
Dividends on preferred stock ($37.19 per share)	(5,021	)	—	—	—		(5,021	)	—		—		—
Restricted stock grants (536,110 shares)	—		—	—	(5,200	)	(5,878	)	11,078		—		—
Forfeitures of restricted stock (90,306 shares)	—		—	—	994		872		(1,866	)	—		—
Stock-based compensation	5,272		—	—	5,222		50		—		—		—
Net tax benefit shortfall from stock-based compensation	(1,296	)	—	—	(1,296	)	—		—		—		—
Allocation of ESOP stock	7,849		—	—	5,137		—		—		—		2,712
Balance at September 30, 2013	$1,457,916		$129,796	$1,665	$889,546		$1,915,736		$(1,397,543	)	$(80,454	)	$(830	)

See accompanying Notes to Consolidated Financial Statements.

5

ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES

Consolidated Statements of Cash Flows (Unaudited)

	For the Nine Months Ended
	September 30,
(In Thousands)	2013			2012
Cash flows from operating activities:
Net income	$	46,441		$	36,175
Adjustments to reconcile net income to net cash provided by operating activities:
Net amortization on loans	16,966			20,081
Net amortization on securities and borrowings	13,084			11,919
Net provision for loan and real estate losses	17,135			31,995
Depreciation and amortization	8,653			8,906
Net gain on sales of loans and securities	(8,595		)	(9,874		)
Net (gain) loss on dispositions of premises and equipment	(4		)	62
Other asset impairment charges	89			457
Originations of loans held-for-sale	(229,041		)	(268,766		)
Proceeds from sales and principal repayments of loans held-for-sale	295,076			264,432
Stock-based compensation and allocation of ESOP stock	13,121			10,771
Decrease in accrued interest receivable	2,038			180
Mortgage servicing rights amortization and valuation allowance adjustments, net	(512		)	3,996
Bank owned life insurance income and insurance proceeds received, net	(3,027		)	(6,152		)
Decrease in other assets	31,534			76,824
(Decrease) increase in accrued expenses and other liabilities	(13,902		)	6,743
Net cash provided by operating activities	189,056			187,749
Cash flows from investing activities:
Originations of loans receivable	(1,782,858		)	(2,741,316		)
Loan purchases through third parties	(348,550		)	(850,905		)
Principal payments on loans receivable	2,724,868			3,212,449
Proceeds from sales of delinquent and non-performing loans	18,501			21,631
Purchases of securities held-to-maturity	(828,835		)	(533,031		)
Purchases of securities available-for-sale	(221,080		)	(208,195		)
Principal payments on securities held-to-maturity	602,321			699,899
Principal payments on securities available-for-sale	86,270			166,554
Proceeds from sales of securities available-for-sale	41,640			54,318
Net redemptions (purchases) of Federal Home Loan Bank of New York stock	17,977			(50,165		)
Redemption of Astoria Capital Trust I common securities	3,866			—
Proceeds from sales of real estate owned, net	29,560			48,235
Purchases of premises and equipment	(6,142		)	(5,899		)
Proceeds from sales of premises and equipment	50			—
Net cash provided by (used in) investing activities	337,588			(186,425		)
Cash flows from financing activities:
Net decrease in deposits	(383,584		)	(706,732		)
Net increase in borrowings with original terms of three months or less	189,000			684,000
Proceeds from borrowings with original terms greater than three months	—			950,000
Repayments of borrowings with original terms greater than three months	(453,866		)	(944,000		)
Cash payments for debt issuance costs	—			(2,643		)
Net increase in mortgage escrow funds	24,147			21,236
Proceeds from issuance of preferred stock	135,000			—
Cash payments for preferred stock issuance costs	(5,204		)	—
Cash dividends paid to stockholders	(14,577		)	(20,249		)
Net tax benefit shortfall from stock-based compensation	(1,296		)	(2,067		)
Net cash used in financing activities	(510,380		)	(20,455		)
Net increase (decrease) in cash and cash equivalents	16,264			(19,131		)
Cash and cash equivalents at beginning of period	121,473			132,704
Cash and cash equivalents at end of period	$	137,737		$	113,573
Supplemental disclosures:
Interest paid	$	137,551		$	197,198
Income taxes paid	$	13,455		$	5,524
Additions to real estate owned	$	36,962		$	33,496
Loans transferred to held-for-sale	$	15,642		$	1,982

See accompanying Notes to Consolidated Financial Statements.

6

ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Unaudited)

1.Basis of Presentation

The accompanying consolidated financial statements include the accounts of Astoria Financial Corporation and its wholly-owned subsidiaries: Astoria Federal Savings and Loan Association and its subsidiaries, referred to as Astoria Federal, and AF Insurance Agency, Inc.  As used in this quarterly report, “we,” “us” and “our” refer to Astoria Financial Corporation and its consolidated subsidiaries.  All significant inter-company accounts and transactions have been eliminated in consolidation.

In addition to Astoria Federal and AF Insurance Agency, Inc., we had another subsidiary, Astoria Capital Trust I, which was not consolidated with Astoria Financial Corporation for financial reporting purposes.  On May 14, 2013, we filed a Certificate of Cancellation of Certificate of Trust of Astoria Capital Trust I with the Delaware Secretary of State.  See Note 5 for further discussion of Astoria Capital Trust I.

In our opinion, the accompanying consolidated financial statements contain all adjustments (consisting only of normal recurring adjustments) necessary for a fair presentation of our financial condition as of September 30, 2013 and December 31, 2012, our results of operations and other comprehensive income/loss for the three and nine months ended September 30, 2013 and 2012, changes in our stockholders’ equity for the nine months ended September 30, 2013 and our cash flows for the nine months ended September 30, 2013 and 2012.  In preparing the consolidated financial statements, we are required to make estimates and assumptions that affect the reported amounts of assets and liabilities for the consolidated statements of financial condition as of September 30, 2013 and December 31, 2012, and amounts of revenues, expenses and other comprehensive income/loss in the consolidated statements of income and comprehensive income for the three and nine months ended September 30, 2013 and 2012.  The results of operations and other comprehensive income/loss for the three and nine months ended September 30, 2013 are not necessarily indicative of the results of operations and other comprehensive income/loss to be expected for the remainder of the year.  Certain information and note disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles, or GAAP, have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission, or SEC.  Certain reclassifications have been made to prior year amounts to conform to the current year presentation.

These consolidated financial statements should be read in conjunction with our December 31, 2012 audited consolidated financial statements and related notes included in our 2012 Annual Report on Form 10-K.

7

2.     Securities

The following tables set forth the amortized cost and estimated fair value of securities available-for-sale and held-to-maturity at the dates indicated.

	At September 30, 2013
(In Thousands)	AmortizedCost		GrossUnrealizedGains		GrossUnrealizedLosses			EstimatedFairValue
Available-for-sale:
Residential mortgage-backed securities:
GSE (1) issuance REMICs and CMOs (2)	$	300,047	$	2,310	$	(5,391	)	$	296,966
Non-GSE issuance REMICs and CMOs	8,330		67		(1		)	8,396
GSE pass-through certificates	17,150		810		(3		)	17,957
Total residential mortgage-backed securities	325,527		3,187		(5,395		)	323,319
Obligations of GSEs	98,674		—		(6,244		)	92,430
Fannie Mae stock	15		—		(14		)	1
Total securities available-for-sale	$	424,216	$	3,187	$	(11,653	)	$	415,750
Held-to-maturity:
Residential mortgage-backed securities:
GSE issuance REMICs and CMOs	$	1,534,021	$	16,264	$	(21,336	)	$	1,528,949
Non-GSE issuance REMICs and CMOs	4,054		69		(10		)	4,113
GSE pass-through certificates	288,655		884		(8,235		)	281,304
Total residential mortgage-backed securities	1,826,730		17,217		(29,581		)	1,814,366
Obligations of GSEs	88,127		—		(6,326		)	81,801
Other	604		—		—			604
Total securities held-to-maturity	$	1,915,461	$	17,217	$	(35,907	)	$	1,896,771

(1) Government-sponsored enterprise

(2) Real estate mortgage investment conduits and collateralized mortgage obligations

	At December 31, 2012
(In Thousands)	AmortizedCost		GrossUnrealizedGains		GrossUnrealizedLosses			EstimatedFairValue
Available-for-sale:
Residential mortgage-backed securities:
GSE issuance REMICs and CMOs	$	200,152	$	5,258	$	(583	)	$	204,827
Non-GSE issuance REMICs and CMOs	11,296		9		(86		)	11,219
GSE pass-through certificates	20,348		1,029		(2		)	21,375
Total residential mortgage-backed securities	231,796		6,296		(671		)	237,421
Obligations of GSEs	98,670		214		(5		)	98,879
Fannie Mae stock	15		—		(15		)	—
Total securities available-for-sale	$	330,481	$	6,510	$	(691	)	$	336,300
Held-to-maturity:
Residential mortgage-backed securities:
GSE issuance REMICs and CMOs	$	1,693,437	$	27,787	$	(2,955	)	$	1,718,269
Non-GSE issuance REMICs and CMOs	5,791		112		—			5,903
GSE pass-through certificates	257		6		(1		)	262
Total residential mortgage-backed securities	1,699,485		27,905		(2,956		)	1,724,434
Other	656		—		—			656
Total securities held-to-maturity	$	1,700,141	$	27,905	$	(2,956	)	$	1,725,090

8

The following tables set forth the estimated fair values of securities with gross unrealized losses at the dates indicated, segregated between securities that have been in a continuous unrealized loss position for less than twelve months and those that have been in a continuous unrealized loss position for twelve months or longer at the dates indicated.

	At September 30, 2013
	Less Than Twelve Months		Twelve Months or Longer		Total
(In Thousands)	EstimatedFair Value	GrossUnrealizedLosses	EstimatedFair Value	GrossUnrealizedLosses	EstimatedFair Value	GrossUnrealizedLosses
Available-for-sale:
GSE issuance REMICs and CMOs	$ 157,497	$   (5,193)	$ 17,296	$(198)	$ 174,793	$(5,391	)
Non-GSE issuance REMICs and CMOs	—	—	140	(1)	140	(1	)
GSE pass-through certificates	292	(1)	90	(2)	382	(3	)
Obligations of GSEs	92,430	(6,244)	—	—	92,430	(6,244	)
Fannie Mae stock	—	—	1	(14)	1	(14	)
Total temporarily impaired securities available-for-sale	$ 250,219	$ (11,438)	$17,527	$(215)	$ 267,746	$(11,653	)
Held-to-maturity:
GSE issuance REMICs and CMOs	$ 647,583	$ (17,525)	$78,148	$(3,811)	$ 725,731	$(21,336	)
Non-GSE issuance REMICs and CMOs	398	(10)	—	—	398	(10	)
GSE pass-through certificates	182,209	(8,234)	31	(1)	182,240	(8,235	)
Obligations of GSEs	81,801	(6,326)	—	—	81,801	(6,326	)
Total temporarily impaired securities held-to-maturity	$ 911,991	$ (32,095)	$78,179	$(3,812)	$ 990,170	$(35,907	)

	At December 31, 2012
	Less Than Twelve Months		Twelve Months or Longer		Total
(In Thousands)	EstimatedFair Value	GrossUnrealizedLosses	EstimatedFair Value	GrossUnrealizedLosses	EstimatedFair Value	GrossUnrealizedLosses
Available-for-sale:
GSE issuance REMICs and CMOs	$   67,841	$    (583)	$       —	$     —	$  67,841	$(583	)
Non-GSE issuance REMICs and CMOs	—	—	10,709	(86)	10,709	(86	)
GSE pass-through certificates	57	(1)	47	(1)	104	(2	)
Obligations of GSEs	24,995	(5)	—	—	24,995	(5	)
Fannie Mae stock	—	—	—	(15)	—	(15	)
Total temporarily impaired securities available-for-sale	$   92,893	$    (589)	$ 10,756	$ (102)	$ 103,649	$(691	)
Held-to-maturity:
GSE issuance REMICs and CMOs	$ 413,651	$ (2,759)	$ 12,259	$ (196)	$ 425,910	$(2,955	)
GSE pass-through certificates	48	(1)	—	—	48	(1	)
Total temporarily impaired securities held-to-maturity	$ 413,699	$ (2,760)	$ 12,259	$ (196)	$ 425,958	$(2,956	)

We held 91 securities which had an unrealized loss at September 30, 2013 and 41 at December 31, 2012.  At September 30, 2013 and December 31, 2012, substantially all of the securities in an unrealized loss position had a fixed interest rate and the cause of the temporary impairment was directly related to the change in interest rates.  We generally view changes in fair value caused by changes in interest rates as temporary, which is consistent with our experience.  None of the unrealized losses are related to credit losses.  Therefore, at September 30, 2013 and December 31, 2012, the impairments were deemed temporary based on (1) the direct relationship of the decline in fair value to movements in interest rates, (2) the estimated remaining life and high credit quality of the investments and (3) the fact that we had no intention to sell these securities and it was not more likely than not that we would be required to sell these securities before their anticipated recovery of the remaining amortized cost basis and we expected to recover the entire amortized cost basis of the security.

9

During the nine months ended September 30, 2013, proceeds from sales of securities from the available-for-sale portfolio totaled $41.6 million resulting in gross realized gains totaling $2.1 million.  During the nine months ended September 30, 2012, proceeds from sales of securities from the available-for-sale portfolio totaled $54.3 million, resulting in gross realized gains totaling $2.5 million.

At September 30, 2013, available-for-sale debt securities excluding mortgage-backed securities had an amortized cost of $98.7 million, a fair value of $92.4 million and contractual maturities in 2021 and 2022.  At September 30, 2013, held-to-maturity debt securities excluding mortgage-backed securities had an amortized cost of $88.7 million, a fair value of $82.4 million and contractual maturities in 2020 through 2023.  Actual maturities may differ from contractual maturities because issuers may have the right to prepay or call obligations with or without prepayment penalties.

At September 30, 2013, we held securities with an amortized cost of $186.8 million which are callable within one year and at various times thereafter.

The balance of accrued interest receivable for securities totaled $6.2 million at September 30, 2013 and $5.7 million at December 31, 2012.

3.     Loans Held-for-Sale

Loans held-for-sale, net, includes fifteen and thirty year fixed rate one-to-four family, or residential, mortgage loans originated for sale that conform to GSE guidelines (conforming loans), as well as certain delinquent and non-performing loans.  Upon our decision to sell certain delinquent and non-performing loans held in portfolio, we reclassify them to held-for-sale at the lower of cost or fair value, less estimated selling costs.  Non-performing loans held-for-sale included in loans held-for-sale, net of valuation allowances, totaled $884,000 at September 30, 2013 and $3.9 million at December 31, 2012.  Non-performing loans held-for-sale were comprised primarily of multi-family mortgage loans at September 30, 2013.  Substantially all of the non-performing loans held-for-sale were multi-family mortgage loans at December 31, 2012.

We sold certain delinquent and non-performing mortgage loans, primarily multi-family and commercial real estate loans, totaling $18.4 million, net of charge-offs of $4.3 million, during the nine months ended September 30, 2013 and $20.4 million, net of charge-offs of $11.0 million, during the nine months ended September 30, 2012.  Net gain on sales of non-performing loans totaled $56,000 for the three months ended September 30, 2013 and $118,000 for the nine months ended September 30, 2013.  Net loss on sales of non-performing loans totaled $2,000 for the three months ended September 30, 2012 and net gain on sales of non-performing loans totaled $1.3 million for the nine months ended September 30, 2012.

We recorded net lower of cost or market write-downs on non-performing loans held-for-sale totaling $54,000 for the three months ended September 30, 2013 and $89,000 for the nine months ended September 30, 2013.  Net lower of cost or market write-downs on non-performing loans held-for-sale totaled $234,000 for the three months ended September 30, 2012 and $457,000 for the nine months ended September 30, 2012.  Lower of cost or market write-downs and recoveries on non-performing loans held-for-sale and gains and losses recognized on sales of such loans are included in other non-interest income in the consolidated statements of income.

10

4.     Loans Receivable and Allowance for Loan Losses

The following tables set forth the composition of our loans receivable portfolio, and an aging analysis by accruing and non-accrual loans, by segment and class at the dates indicated.

	At September 30, 2013
	Past Due
	30-59		60-89		90 Days		Total
(In Thousands)	Days		Days		or More		Past Due		Current		Total
Accruing loans:
Mortgage loans (gross):
Residential:
Full documentation interest-only	$	23,479	$	6,327	$	—	$	29,806	$	1,387,347	$	1,417,153
Full documentation amortizing	29,947		9,623		—		39,570		5,408,913		5,448,483
Reduced documentation interest-only	24,384		7,232		—		31,616		723,406		755,022
Reduced documentation amortizing	8,635		1,997		—		10,632		348,810		359,442
Total residential	86,445		25,179		—		111,624		7,868,476		7,980,100
Multi-family	8,961		1,448		—		10,409		3,091,944		3,102,353
Commercial real estate	—		1,024		55		1,079		811,128		812,207
Total mortgage loans	95,406		27,651		55		123,112		11,771,548		11,894,660
Consumer and other loans (gross):
Home equity lines of credit	2,573		1,350		—		3,923		196,121		200,044
Other	60		36		—		96		37,499		37,595
Total consumer and other loans	2,633		1,386		—		4,019		233,620		237,639
Total accruing loans	$	98,039	$	29,037	$	55	$	127,131	$	12,005,168	$	12,132,299
Non-accrual loans:
Mortgage loans (gross):
Residential:
Full documentation interest-only	$	1,863	$	—	$	85,019	$	86,882	$	21,802	$	108,684
Full documentation amortizing	346		1,226		42,294		43,866		8,675		52,541
Reduced documentation interest-only	3,129		492		91,089		94,710		29,814		124,524
Reduced documentation amortizing	1,532		129		26,289		27,950		4,719		32,669
Total residential	6,870		1,847		244,691		253,408		65,010		318,418
Multi-family	1,030		363		11,037		12,430		3,231		15,661
Commercial real estate	—		937		1,098		2,035		8,578		10,613
Total mortgage loans	7,900		3,147		256,826		267,873		76,819		344,692
Consumer and other loans (gross):
Home equity lines of credit	—		—		6,441		6,441		32		6,473
Other	—		—		33		33		—		33
Total consumer and other loans	—		—		6,474		6,474		32		6,506
Total non-accrual loans	$	7,900	$	3,147	$	263,300	$	274,347	$	76,851	$	351,198
Total loans:
Mortgage loans (gross):
Residential:
Full documentation interest-only	$	25,342	$	6,327	$	85,019	$	116,688	$	1,409,149	$	1,525,837
Full documentation amortizing	30,293		10,849		42,294		83,436		5,417,588		5,501,024
Reduced documentation interest-only	27,513		7,724		91,089		126,326		753,220		879,546
Reduced documentation amortizing	10,167		2,126		26,289		38,582		353,529		392,111
Total residential	93,315		27,026		244,691		365,032		7,933,486		8,298,518
Multi-family	9,991		1,811		11,037		22,839		3,095,175		3,118,014
Commercial real estate	—		1,961		1,153		3,114		819,706		822,820
Total mortgage loans	103,306		30,798		256,881		390,985		11,848,367		12,239,352
Consumer and other loans (gross):
Home equity lines of credit	2,573		1,350		6,441		10,364		196,153		206,517
Other	60		36		33		129		37,499		37,628
Total consumer and other loans	2,633		1,386		6,474		10,493		233,652		244,145
Total loans	$	105,939	$	32,184	$	263,355	$	401,478	$	12,082,019	$	12,483,497
Net unamortized premiums and deferred loan origination costs											58,046
Loans receivable											12,541,543
Allowance for loan losses											(143,000		)
Loans receivable, net											$	12,398,543

11

	At December 31, 2012
	Past Due
	30-59		60-89		90 Days		Total
(In Thousands)	Days		Days		or More		Past Due		Current		Total
Accruing loans:
Mortgage loans (gross):
Residential:
Full documentation interest-only	$	30,520	$	8,973	$	—	$	39,493	$	1,862,382	$	1,901,875
Full documentation amortizing	35,918		6,564		—		42,482		6,218,064		6,260,546
Reduced documentation interest-only	28,212		7,694		—		35,906		855,907		891,813
Reduced documentation amortizing	11,780		3,893		—		15,673		350,268		365,941
Total residential	106,430		27,124		—		133,554		9,286,621		9,420,175
Multi-family	21,743		5,382		—		27,125		2,368,895		2,396,020
Commercial real estate	13,536		3,126		328		16,990		750,385		767,375
Total mortgage loans	141,709		35,632		328		177,669		12,405,901		12,583,570
Consumer and other loans (gross):
Home equity lines of credit	3,103		1,092		—		4,195		221,266		225,461
Other	120		223		—		343		31,782		32,125
Total consumer and other loans	3,223		1,315		—		4,538		253,048		257,586
Total accruing loans	$	144,932	$	36,947	$	328	$	182,207	$	12,658,949	$	12,841,156
Non-accrual loans:
Mortgage loans (gross):
Residential:
Full documentation interest-only	$	—	$	677	$	97,907	$	98,584	$	937	$	99,521
Full documentation amortizing	363		—		43,014		43,377		949		44,326
Reduced documentation interest-only	1,042		—		107,254		108,296		5,186		113,482
Reduced documentation amortizing	445		13		32,496		32,954		768		33,722
Total residential	1,850		690		280,671		283,211		7,840		291,051
Multi-family	—		—		7,359		7,359		3,299		10,658
Commercial real estate	—		—		6,541		6,541		—		6,541
Total mortgage loans	1,850		690		294,571		297,111		11,139		308,250
Consumer and other loans (gross):
Home equity lines of credit	—		—		6,459		6,459		—		6,459
Other	—		—		49		49		—		49
Total consumer and other loans	—		—		6,508		6,508		—		6,508
Total non-accrual loans	$	1,850	$	690	$	301,079	$	303,619	$	11,139	$	314,758
Total loans:
Mortgage loans (gross):
Residential:
Full documentation interest-only	$	30,520	$	9,650	$	97,907	$	138,077	$	1,863,319	$	2,001,396
Full documentation amortizing	36,281		6,564		43,014		85,859		6,219,013		6,304,872
Reduced documentation interest-only	29,254		7,694		107,254		144,202		861,093		1,005,295
Reduced documentation amortizing	12,225		3,906		32,496		48,627		351,036		399,663
Total residential	108,280		27,814		280,671		416,765		9,294,461		9,711,226
Multi-family	21,743		5,382		7,359		34,484		2,372,194		2,406,678
Commercial real estate	13,536		3,126		6,869		23,531		750,385		773,916
Total mortgage loans	143,559		36,322		294,899		474,780		12,417,040		12,891,820
Consumer and other loans (gross):
Home equity lines of credit	3,103		1,092		6,459		10,654		221,266		231,920
Other	120		223		49		392		31,782		32,174
Total consumer and other loans	3,223		1,315		6,508		11,046		253,048		264,094
Total loans	$	146,782	$	37,637	$	301,407	$	485,826	$	12,670,088	$	13,155,914
Net unamortized premiums and deferred loan origination costs											68,058
Loans receivable											13,223,972
Allowance for loan losses											(145,501		)
Loans receivable, net											$	13,078,471

12

We segment our residential mortgage loan portfolio by interest-only and amortizing loans, full documentation and reduced documentation loans and year of origination and analyze our historical loss experience and delinquency levels and trends of these segments.  We analyze multi-family and commercial real estate loans by portfolio, geographic location and year of origination.  We analyze our consumer and other loan portfolio by home equity lines of credit, commercial loans, revolving credit lines and installment loans and perform similar historical loss analyses.

Effective in the 2013 first quarter, in addition to residential loans discharged in a Chapter 7 bankruptcy filing, or bankruptcy loans, placed on non-accrual status and reported as non-performing loans as of December 31, 2012, we also included bankruptcy loans discharged prior to 2012 regardless of the delinquency status of the loans, which resulted in an increase in non-performing loans at September 30, 2013 compared to December 31, 2012.  Non-performing loans at September 30, 2013 included $64.3 million of bankruptcy loans which were current or less than 90 days past due, including $49.9 million which were discharged prior to 2012.  Of the bankruptcy loans which were current or less than 90 days past due at September 30, 2013, $57.8 million were current, $5.9 million were 30-59 days past due and $535,000 were 60-89 days past due.  Such loans continue to generate interest income on a cash basis as payments are received.  Pursuant to regulatory guidance issued in 2012, bankruptcy loans, in addition to being placed on non-accrual status and reported as non-performing loans, are also reported as loans modified in a troubled debt restructuring, or TDR, and as impaired loans; such loans totaled $88.0 million at September 30, 2013, including bankruptcy loans discharged prior to 2012 of $66.3 million.

We analyze our historical loss experience over twelve, fifteen, eighteen and twenty-four month periods.  The loss history used in calculating our quantitative allowance coverage percentages varies based on loan type.  Also, for a particular loan type we may not have sufficient loss history to develop a reasonable estimate of loss and consider our loss experience for other, similar loan types and may evaluate those losses over a longer period than two years.  Additionally, multi-family and commercial real estate loss experience may be adjusted based on the composition of the losses (loan sales, short sales and partial charge-offs).  We update our historical loss analyses quarterly and evaluate the need to modify our quantitative allowances as a result of our updated charge-off and loss analyses.  In the 2013 third quarter, we further updated the method of determining our allowance level by (1) extending our evaluation of loss experience factors to consider trends in such factors over the prior two years for the majority of the loan portfolio, and (2) giving consideration to more detailed modeling techniques as an added factor for multi-family and commercial real estate loans originated since 2010.  We also consider qualitative factors with the purpose of assessing the adequacy of the overall allowance for loan losses as well as the allocation of the allowance for loan losses by portfolio.

Allowance adequacy calculations are adjusted quarterly, based on the results of our quantitative and qualitative analyses, to reflect our current estimates of the amount of probable losses inherent in our loan portfolio in determining our allowance for loan losses.  Beginning with the 2013 first quarter, the allowance for loan losses allocated to residential mortgage loans over 180 days delinquent with a charge-off, previously determined within our qualitative analysis, is now determined within our quantitative analysis and presented as attributable to those loans individually evaluated for impairment.  The portion of the allowance allocated to each loan category does not represent the total available to absorb losses which may occur within the loan category, since the total allowance for loan losses is available for losses applicable to the entire loan portfolio.

13

The following tables set forth the changes in our allowance for loan losses by loan receivable segment for the periods indicated.

	For the Three Months Ended September 30, 2013
	Mortgage Loans						Consumer
(In Thousands)	Residential		Multi-Family		CommercialReal Estate		and OtherLoans		Total
Balance at July 1, 2013	$	78,788	$	40,865	$	16,642	$	7,605	$	143,900
Provision charged (credited) to operations	7,659		(2,521)		(2,592)		(5)		2,541
Charge-offs	(5,560)		(99)		(293)		(544)		(6,496		)
Recoveries	2,537		—		247		271		3,055
Balance at September 30, 2013	$	83,424	$	38,245	$	14,004	$	7,327	$	143,000

	For the Nine Months Ended September 30, 2013
	Mortgage Loans						Consumer
(In Thousands)	Residential		Multi-Family		CommercialReal Estate		and OtherLoans		Total
Balance at January 1, 2013	$	89,267	$	35,514	$	14,404	$	6,316	$	145,501
Provision charged to operations	7,488		5,131		1,378		2,196		16,193
Charge-offs	(20,332)		(3,637)		(2,313)		(1,672)		(27,954		)
Recoveries	7,001		1,237		535		487		9,260
Balance at September 30, 2013	$	83,424	$	38,245	$	14,004	$	7,327	$	143,000

	For the Three Months Ended September 30, 2012
	Mortgage Loans						Consumer
(In Thousands)	Residential		Multi-Family		CommercialReal Estate		and OtherLoans		Total
Balance at July 1, 2012	$	87,394	$	48,142	$	9,109	$	3,457	$	148,102
Provision charged (credited) to operations	9,210		(6,168)		3,828		2,630		9,500
Charge-offs	(8,195)		(1,233)		(1,379)		(891)		(11,698		)
Recoveries	2,355		122		—		91		2,568
Balance at September 30, 2012	$	90,764	$	40,863	$	11,558	$	5,287	$	148,472

	For the Nine Months Ended September 30, 2012
	Mortgage Loans						Consumer
(In Thousands)	Residential		Multi-Family		CommercialReal Estate		and OtherLoans		Total
Balance at January 1, 2012	$	105,991	$	35,422	$	11,972	$	3,800	$	157,185
Provision charged to operations	16,387		8,381		1,303		3,429		29,500
Charge-offs	(37,598)		(3,139)		(1,718)		(2,367)		(44,822		)
Recoveries	5,984		199		1		425		6,609
Balance at September 30, 2012	$	90,764	$	40,863	$	11,558	$	5,287	$	148,472

The following table sets forth the balances of our residential interest-only mortgage loans at September 30, 2013 by the period in which such loans are scheduled to enter their amortization period.

(In Thousands)	Recorded Investment
Amortization scheduled to begin:
Within one year	$	229,445
More than one year to three years	1,334,544
More than three years to five years	769,974
Over five years	71,420
Total	$	2,405,383

14

The following tables set forth the balances of our residential mortgage and consumer and other loan receivable segments by class and credit quality indicator at the dates indicated.

	At September 30, 2013
	Residential Mortgage Loans								Consumer and Other Loans
	Full Documentation				Reduced Documentation				Home Equity
(In Thousands)	Interest-only		Amortizing		Interest-only		Amortizing		Lines of Credit		Other
Performing	$	1,417,153	$	5,448,483	$	755,022	$	359,442	$	200,044	$	37,595
Non-performing:
Current or past due less than 90 days	23,665		10,247		33,435		6,380		32		—
Past due 90 days or more	85,019		42,294		91,089		26,289		6,441		33
Total	$	1,525,837	$	5,501,024	$	879,546	$	392,111	$	206,517	$	37,628

	At December 31, 2012
	Residential Mortgage Loans								Consumer and Other Loans
	Full Documentation				Reduced Documentation				Home Equity
(In Thousands)	Interest-only		Amortizing		Interest-only		Amortizing		Lines of Credit		Other
Performing	$	1,901,875	$	6,260,546	$	891,813	$	365,941	$	225,461	$	32,125
Non-performing:
Current or past due less than 90 days	1,614		1,312		6,228		1,226		—		—
Past due 90 days or more	97,907		43,014		107,254		32,496		6,459		49
Total	$	2,001,396	$	6,304,872	$	1,005,295	$	399,663	$	231,920	$	32,174

The following table sets forth the balances of our multi-family and commercial real estate mortgage loan receivable segments by credit quality indicator at the dates indicated.

	At September 30, 2013				At December 31, 2012
(In Thousands)	Multi-Family		CommercialReal Estate		Multi-Family		CommercialReal Estate
Not criticized	$	3,027,701	$	774,515	$	2,271,006	$	706,334
Criticized:
Special mention	20,016		8,123		54,956		28,210
Substandard	70,297		40,182		80,716		39,372
Doubtful	—		—		—		—
Total	$	3,118,014	$	822,820	$	2,406,678	$	773,916

The following tables set forth the balances of our loans receivable and the related allowance for loan loss allocation by segment and by the impairment methodology followed in determining the allowance for loan losses at the dates indicated.

	At September 30, 2013
	Mortgage Loans						Consumer
(In Thousands)	Residential		Multi- Family		CommercialReal Estate		and OtherLoans		Total
Loans:
Individually evaluated for impairment	$	313,495	$	55,391	$	17,154	$	—	$	386,040
Collectively evaluated for impairment	7,985,023		3,062,623		805,666		244,145		12,097,457
Total loans	$	8,298,518	$	3,118,014	$	822,820	$	244,145	$	12,483,497
Allowance for loan losses:
Individually evaluated for impairment	$	22,265	$	2,179	$	322	$	—	$	24,766
Collectively evaluated for impairment	61,159		36,066		13,682		7,327		118,234
Total allowance for loan losses	$	83,424	$	38,245	$	14,004	$	7,327	$	143,000

15

	At December 31, 2012
	Mortgage Loans						Consumer
(In Thousands)	Residential		Multi-Family		CommercialReal Estate		and OtherLoans		Total
Loans:
Individually evaluated for impairment	$	272,146	$	56,116	$	18,644	$	—	$	346,906
Collectively evaluated for impairment	9,439,080		2,350,562		755,272		264,094		12,809,008
Total loans	$	9,711,226	$	2,406,678	$	773,916	$	264,094	$	13,155,914
Allowance for loan losses:
Individually evaluated for impairment	$	1,001	$	2,576	$	1,469	$	—	$	5,046
Collectively evaluated for impairment	88,266		32,938		12,935		6,316		140,455
Total allowance for loan losses	$	89,267	$	35,514	$	14,404	$	6,316	$	145,501

The following table summarizes information related to our impaired mortgage loans by segment and class at the dates indicated.

	At September 30, 2013									At December 31, 2012
(In Thousands)	UnpaidPrincipalBalance		RecordedInvestment		RelatedAllowance			NetInvestment		UnpaidPrincipalBalance		RecordedInvestment		RelatedAllowance			NetInvestment
With an allowance recorded:
Residential:
Full documentation interest-only	$	149,386	$	114,923	$	(7,797	)	$	107,126	$	10,740	$	10,740	$	(241	)	$	10,499
Full documentation amortizing	40,794		35,014		(2,550		)	32,464		6,122		6,122		(347		)	5,775
Reduced documentation interest-only	183,353		139,472		(9,564		)	129,908		12,893		12,893		(277		)	12,616
Reduced documentation amortizing	29,062		24,086		(2,354		)	21,732		3,889		3,889		(136		)	3,753
Multi-family	23,437		23,437		(2,179		)	21,258		19,704		19,704		(2,576		)	17,128
Commercial real estate	6,764		6,764		(322		)	6,442		10,835		10,835		(1,469		)	9,366
Without an allowance recorded:
Residential:
Full documentation interest-only	—		—		—			—		122,275		86,607		—			86,607
Full documentation amortizing	—		—		—			—		23,489		17,962		—			17,962
Reduced documentation interest-only	—		—		—			—		166,477		116,514		—			116,514
Reduced documentation amortizing	—		—		—			—		23,419		17,419		—			17,419
Multi-family	38,635		31,954		—			31,954		44,341		36,412		—			36,412
Commercial real estate	14,830		10,390		—			10,390		13,256		7,809		—			7,809
Total impaired loans	$	486,261	$	386,040	$	(24,766	)	$	361,274	$	457,440	$	346,906	$	(5,046	)	$	341,860

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The following tables set forth the average recorded investment, interest income recognized and cash basis interest income related to our impaired mortgage loans by segment and class for the periods indicated.

	For the Three Months Ended September 30,
	2013						2012
(In Thousands)	AverageRecordedInvestment		InterestIncomeRecognized		Cash BasisInterestIncome		AverageRecordedInvestment		InterestIncomeRecognized		Cash BasisInterestIncome
With an allowance recorded:
Residential:
Full documentation interest-only	$	107,893	$	762	$	763	$	10,254	$	79	$	77
Full documentation amortizing	31,128		218		220		4,210		40		41
Reduced documentation interest-only	144,468		1,171		1,174		10,469		130		122
Reduced documentation amortizing	24,452		158		152		2,272		27		19
Multi-family	19,557		34		169		60,560		1,146		590
Commercial real estate	7,604		56		66		11,838		229		97
Without an allowance recorded:
Residential:
Full documentation interest-only	9,075		—		—		83,722		417		411
Full documentation amortizing	2,968		—		—		16,611		117		108
Reduced documentation interest-only	—		—		—		118,021		742		728
Reduced documentation amortizing	—		—		—		18,694		79		69
Multi-family	31,464		401		416		12,517		503		227
Commercial real estate	11,252		112		131		6,623		272		99
Total impaired loans	$	389,861	$	2,912	$	3,091	$	355,791	$	3,781	$	2,588

	For the Nine Months Ended September 30,
	2013						2012
(In Thousands)	AverageRecordedInvestment		InterestIncomeRecognized		Cash BasisInterestIncome		AverageRecordedInvestment		InterestIncomeRecognized		Cash BasisInterestIncome
With an allowance recorded:
Residential:
Full documentation interest-only	$	105,931	$	2,114	$	2,229	$	10,360	$	247	$	247
Full documentation amortizing	29,465		623		639		4,071		121		122
Reduced documentation interest-only	146,773		3,053		3,205		10,967		342		345
Reduced documentation amortizing	25,424		464		493		2,084		86		78
Multi-family	18,975		659		722		55,319		2,252		1,946
Commercial real estate	8,692		253		285		13,196		430		321
Without an allowance recorded:
Residential:
Full documentation interest-only	14,433		—		—		81,638		1,069		1,136
Full documentation amortizing	4,396		—		—		17,452		221		234
Reduced documentation interest-only	2,086		—		—		115,363		1,731		1,824
Reduced documentation amortizing	—		—		—		17,293		291		303
Multi-family	33,294		1,165		1,229		9,168		921		662
Commercial real estate	10,118		286		319		4,812		541		389
Total impaired loans	$	399,587	$	8,617	$	9,121	$	341,723	$	8,252	$	7,607

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The following tables set forth information about our mortgage loans receivable by segment and class at September 30, 2013 and 2012 which were modified in a TDR during the periods indicated.

	Modifications During the Three Months Ended September 30,
	2013			2012
(Dollars In Thousands)	Number of Loans	Pre- Modification Recorded Investment	Recorded Investment at September 30, 2013	Number of Loans	Pre- Modification Recorded Investment	Recorded Investment at September 30, 2012
Residential:
Full documentation interest-only	7	$   2,128	$   2,127	2	$     355	$      354
Full documentation amortizing	1	161	161	3	805	786
Reduced documentation interest-only	10	3,107	3,096	5	2,693	2,690
Reduced documentation amortizing	2	387	386	—	—	—
Multi-family	5	3,967	3,774	—	—	—
Commercial real estate	4	6,488	5,458	3	3,437	3,325
Total	29	$ 16,238	$ 15,002	13	$  7,290	$   7,155

	Modifications During the Nine Months Ended September 30,
	2013			2012
(Dollars In Thousands)	Number of Loans	Pre- Modification Recorded Investment	Recorded Investment at September 30, 2013	Number of Loans	Pre- Modification Recorded Investment	Recorded Investment at September 30, 2012
Residential:
Full documentation interest-only	18	$   4,579	$   4,577	6	$   1,415	$   1,384
Full documentation amortizing	6	1,662	1,682	3	805	786
Reduced documentation interest-only	28	8,957	8,921	12	5,422	5,407
Reduced documentation amortizing	8	2,470	2,408	5	1,950	1,840
Multi-family	8	6,751	6,228	12	31,581	29,129
Commercial real estate	7	10,443	9,125	6	7,671	6,120
Total	75	$ 34,862	$ 32,941	44	$ 48,844	$ 44,666

The following table sets forth information about our mortgage loans receivable by segment and class at September 30, 2013 and 2012 which were modified in a TDR during the twelve months ended September 30, 2013 and 2012 and had a payment default subsequent to the modification during the periods indicated.

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2013		2012		2013		2012
(Dollars In Thousands)	Numberof Loans	RecordedInvestment atSeptember 30, 2013	Numberof Loans	RecordedInvestment atSeptember 30, 2012	Numberof Loans	RecordedInvestment atSeptember 30, 2013	Numberof Loans	RecordedInvestment atSeptember 30, 2012
Residential:
Full documentation interest-only	14	$    3,365	—	$        —	22	$    5,343	—	$        —
Full documentation amortizing	8	2,159	1	485	10	2,589	1	485
Reduced documentation interest-only	20	5,729	3	1,174	24	6,707	5	1,821
Reduced documentation amortizing	2	303	—	—	5	880	5	1,817
Multi-family	1	671	1	2,062	1	671	2	3,743
Total	45	$ 12,227	5	$  3,721	62	$  16,190	13	$    7,866

For additional information regarding our loans receivable and allowance for loan losses, see “Asset Quality” and “Critical Accounting Policies” in Part I, Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” or “MD&A.”

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5.     Borrowings

The following table summarizes our borrowings and their weighted average rates at the dates indicated.

	At September 30, 2013			At December 31, 2012
(Dollars in Thousands)	Amount		Weighted Average Rate	Amount		Weighted Average Rate
Federal funds purchased	$	285,000	0.27%	$	—	—%
Reverse repurchase agreements	1,100,000		3.87	1,100,000		4.32
FHLB-NY advances	2,476,000		1.83	2,897,000		2.07
Other borrowings, net	248,028		5.00	376,496		6.62
Total borrowings, net	$	4,109,028	2.46%	$	4,373,496	3.03%

Included in our borrowings are various obligations which, by their terms, may be called by the counterparty.  At September 30, 2013 and December 31, 2012, we had $1.95 billion of callable borrowings, all of which at December 31, 2012 were contractually callable by the counterparty within three months and on a quarterly basis thereafter.  During the nine months ended September 30, 2013, we restructured $1.35 billion of these borrowings with the counterparties, of which $500.0 million were reverse repurchase agreements and $850.0 million were Federal Home Loan Bank of New York, or FHLB-NY, advances, resulting in a reduction in the weighted average interest rate on such borrowings from 4.40% to 3.46% and an extension of terms from a weighted average remaining term at the time of the restructuring of approximately 4 years to approximately 7 years.  The restructuring also extended the contractual call dates on $950.0 million of these borrowings to 2017, on $100.0 million of these borrowings to 2016 and on $200.0 million of these borrowings to 2015.

The following table sets forth the contractual maturities of our FHLB-NY advances and our reverse repurchase agreements at September 30, 2013.

(In Thousands)	FHLB-NY Advances			Reverse Repurchase Agreements
Contractual Maturity:
Twelve months or less	$	776,000	(1)	$	—
Thirteen to twenty-four months	100,000			—
Twenty-five to thirty-six months	750,000			—
Thirty-seven to forty-eight months	—			600,000		(2)
Forty-nine to sixty months	—			200,000		(3)
Over sixty months	850,000		(4)	300,000		(5)
Total	$	2,476,000		$	1,100,000

(1)	Includes $176.0 million of borrowings due overnight, $350.0 million of borrowings due in less than 30 days, $100.0 million of borrowings due in 30-90 days and $150.0 million of borrowings due after 90 days.
(2)	Callable within the next three months and on a quarterly basis thereafter.
(3)	Callable in 2015.
(4)	Callable in 2017.
(5)	Includes $100.0 million of borrowings which are callable within the next three months and on a quarterly basis thereafter, $100.0 million of borrowings which are callable in 2016 and $100.0 million of borrowings which are callable in 2017.

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Our former finance subsidiary, Astoria Capital Trust I, was formed for the purpose of issuing $125.0 million aggregate liquidation amount of 9.75% Capital Securities due November 1, 2029, or Capital Securities, and $3.9 million of common securities (which were the only voting securities of Astoria Capital Trust I and were owned by Astoria Financial Corporation) and used the proceeds to acquire 9.75% Junior Subordinated Debentures, due November 1, 2029,  issued by Astoria Financial Corporation totaling $128.9 million.  The Junior Subordinated Debentures were the sole assets of Astoria Capital Trust I.  The Junior Subordinated Debentures were prepayable, in whole or in part, at our option at declining premiums to November 1, 2019, after which the Junior Subordinated Debentures were prepayable at par value.  The Capital Securities had the same prepayment provisions as the Junior Subordinated Debentures.  On May 10, 2013, we prepaid in whole our Junior Subordinated Debentures, which were included in other borrowings, net, pursuant to the optional prepayment provisions of the indenture at a prepayment price of 103.413% of the $128.9 million aggregate principal amount, plus accrued and unpaid interest to, but not including, the date of repayment.  As a result of the prepayment in whole of the Junior Subordinated Debentures, Astoria Capital Trust I simultaneously applied the proceeds of such prepayment to redeem its Capital Securities, as well as the common securities owned by Astoria Financial Corporation.  The prepayment of the Junior Subordinated Debentures resulted in a $4.3 million prepayment charge in the 2013 second quarter for the early extinguishment of this debt.

6.     Preferred Stock

On March 19, 2013, in a public offering, we sold 5,400,000 depositary shares, each representing a 1/40th interest in a share of our 6.50% Non-Cumulative Perpetual Preferred Stock, Series C, $1.00 par value per share, $1,000 liquidation preference per share (equivalent to $25 per depositary share), or Series C Preferred Stock.  We issued 135,000 shares of the Series C Preferred Stock in connection with the sale of the depositary shares.  The aggregate proceeds from the offering, net of underwriting discounts and other issuance costs, were approximately $129.8 million.

The Series C Preferred Stock, and corresponding depositary shares, may be redeemed at our option, in whole or in part, on April 15, 2018, or on any dividend payment date occurring thereafter, at a redemption price of $1,000 per share (equivalent to $25 per depositary share), plus any declared and unpaid dividends (without accumulation of any undeclared dividends). The Series C Preferred Stock may also be redeemed in whole, but not in part, at any time upon the occurrence of a “regulatory capital treatment event,” as defined in the certificate of designations included in the registration statement on Form 8-A filed with the SEC on March 19, 2013.  The holders of the Series C Preferred Stock, and the corresponding depositary shares, do not have the right to require the redemption or repurchase of the Series C Preferred Stock.

Beginning in July 2013, dividends are payable on the Series C Preferred Stock when, as and if declared by our Board of Directors, on a non-cumulative basis quarterly in arrears on January 15, April 15, July 15 and October 15 of each year at an annual rate of 6.50% on the liquidation preference of $1,000 per share.  No dividend shall be declared, paid, or set aside for payment on our common stock unless the full dividends for the most recently completed dividend period have been declared and paid on our Series C Preferred Stock.  On June 19, 2013, our Board of Directors declared the first quarterly cash dividend on our Series C Preferred Stock aggregating $2.8 million, or $20.94 per share, for the dividend period from the issuance date of March 19, 2013 through and including July 14, 2013, which was paid on July 15, 2013 to stockholders of

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record as of June 30, 2013.  On September 18, 2013, our Board of Directors declared the second quarterly cash dividend on our Series C Preferred Stock aggregating $2.2 million, or $16.25 per share, for the quarterly period from July 15, 2013 through and including September 14, 2013, which was paid on October 15, 2013 to stockholders of record as of September 30, 2013.

7.     Earnings Per Common Share

The following table is a reconciliation of basic and diluted earnings per common share, or EPS.

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
(In Thousands, Except Share Data)	2013		2012		2013		2012
Net income	$ 16,924		$ 13,355		$ 46,441		$ 36,175
Preferred stock dividends	(2,194	)	—		(5,021	)	—
Net income available to common shareholders	14,730		13,355		41,420		36,175
Income allocated to participating securities	(195	)	(206	)	(508	)	(250	)
Net income allocated to common shareholders	$ 14,535		$ 13,149		$ 40,912		$ 35,925
Basic weighted average common shares outstanding	97,199,329		95,555,816		96,967,052		95,303,453
Dilutive effect of stock options (1)	—		—		—		—
Diluted weighted average common shares outstanding	97,199,329		95,555,816		96,967,052		95,303,453
Basic EPS	$ 0.15		$ 0.14		$ 0.42		$ 0.38
Diluted EPS	$ 0.15		$ 0.14		$ 0.42		$ 0.38

(1) Excludes options to purchase 1,871,935 shares of common stock which were outstanding during the three months ended September 30, 2013; options to purchase 5,452,028 shares of common stock which were outstanding during the three months ended September 30, 2012; options to purchase 2,215,820 shares of common stock which were outstanding during the nine months ended September 30, 2013; and options to purchase 5,674,912 shares of common stock which were outstanding during the nine months ended September 30, 2012 because their inclusion would be anti-dilutive.

For EPS computations, unvested shares of restricted common stock represent participating securities.  In contrast, unvested restricted stock units are treated as potential common shares with the dilutive effect calculated using the treasury stock method.  However, the unvested restricted stock units are excluded from the denominator for both the basic and diluted EPS computations until the performance conditions are satisfied.  As a result, unvested restricted stock units were excluded from the EPS computation for the three and nine months ended September 30, 2013.  There were no unvested restricted stock units outstanding during the three and nine months ended September 30, 2012.  See Note 10 for additional information about the restricted stock units granted in 2013.

8.     Other Comprehensive Income/Loss

The following disclosures reflect our adoption, effective January 1, 2013, of the guidance in Accounting Standards Update, or ASU, 2013-02, “Comprehensive Income (Topic 220) Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income.” The guidance in ASU 2013-02 is effective prospectively for reporting periods beginning after December 15, 2012 and is presentation related only.  Our adoption of ASU 2013-02 did not have an impact on our financial condition or results of operations.

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The following tables set forth the components of accumulated other comprehensive loss at the dates indicated and the changes during the three and nine months ended September 30, 2013.

(In Thousands)	AtJune 30, 2013		OtherComprehensive(Loss) Income		AtSeptember 30, 2013
Net unrealized loss on securities available-for-sale	$     (484	)	$ (1,286	)	$  (1,770	)
Net actuarial loss on pension plans and other postretirement benefits	(75,946	)	585		(75,361	)
Prior service cost on pension plans and other postretirement benefits	(3,357	)	34		(3,323	)
Accumulated other comprehensive loss	$(79,787	)	$    (667	)	$(80,454	)

(In Thousands)	AtDecember 31, 2012		OtherComprehensive(Loss) Income		AtSeptember 30, 2013
Net unrealized gain (loss) on securities available-for-sale	$   7,451		$  (9,221	)	$   (1,770	)
Net actuarial loss on pension plans and other postretirement benefits	(77,115	)	1,754		(75,361	)
Prior service cost on pension plans and other postretirement benefits	(3,426	)	103		(3,323	)
Accumulated other comprehensive loss	$(73,090	)	$  (7,364	)	$ (80,454	)

The following tables set forth the components of other comprehensive loss for the periods indicated.

	For the Three Months EndedSeptember 30, 2013
(In Thousands)	Before TaxAmount		Tax Benefit(Expense)		After TaxAmount
Net unrealized holding loss on securities available-for-sale arising during the period	$   (1,984	)	$   698		$  (1,286	)
Reclassification adjustment for net actuarial loss included in net income	903		(318	)	585
Reclassification adjustment for prior service cost included in net income	53		(19	)	34
Other comprehensive loss	$   (1,028	)	$   361		$     (667	)

	For the Nine Months EndedSeptember 30, 2013
(In Thousands)	Before TaxAmount		Tax Benefit(Expense)		After TaxAmount
Net unrealized loss on securities available-for-sale:
Net unrealized holding loss on securities arising during the period	$  (12,180	)	$  4,291		$  (7,889	)
Reclassification adjustment for gain on sales of securities included in net income	(2,057	)	725		(1,332	)
Net unrealized loss on securities available-for-sale	(14,237	)	5,016		(9,221	)
Reclassification adjustment for net actuarial loss included in net income	2,708		(954	)	1,754
Reclassification adjustment for prior service cost included in net income	159		(56	)	103
Other comprehensive loss	$  (11,370	)	$  4,006		$  (7,364	)

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The following table sets forth information about amounts reclassified from accumulated other comprehensive loss to, and the affected line items in, the consolidated statements of income for the periods indicated.

(In Thousands)	For theThree Months EndedSeptember 30, 2013		For theNine Months EndedSeptember 30, 2013		Income StatementLine Item
Reclassification adjustment for gain on sales of securities	$     —		$  2,057		Gain on sales of securities
Reclassification adjustment for net actuarial loss (1)	(903	)	(2,708	)	Compensation and benefits
Reclassification adjustment for prior service cost (1)	(53	)	(159	)	Compensation and benefits
Total reclassifications, before tax	(956	)	(810	)
Income tax effect	337		285		Income tax expense
Total reclassifications, net of tax	$  (619	)	$    (525	)	Net income

(1) These other comprehensive loss components are included in the computations of net periodic cost for our defined benefit pension plans and other postretirement benefit plan.  See Note 9 for additional details.

9.     Pension Plans and Other Postretirement Benefits

The following tables set forth information regarding the components of net periodic cost for our defined benefit pension plans and other postretirement benefit plan for the periods indicated.

	Pension Benefits				Other Postretirement  Benefits
	For the Three Months Ended September 30,				For the Three Months Ended September 30,
(In Thousands)	2013		2012		2013	2012
Service cost	$       —		$        —		$      396	$    265
Interest cost	2,387		2,663		319	345
Expected return on plan assets	(3,188	)	(3,109	)	—	—
Recognized net actuarial loss	785		563		118	129
Amortization of prior service cost (credit)	53		56		—	(6	)
Net periodic cost	$       37		$      173		$      833	$    733

	Pension Benefits				Other Postretirement Benefits
	For the Nine Months Ended September 30,				For the Nine Months Ended September 30,
(In Thousands)	2013		2012		2013	2012
Service cost	$       —		$  2,025		$  1,185	$    796
Interest cost	7,162		8,327		959	1,034
Expected return on plan assets	(9,565	)	(8,837	)	—	—
Recognized net actuarial loss	2,354		4,366		354	387
Amortization of prior service cost (credit)	159		122		—	(18	)
Curtailment	—		7		—	—
Net periodic cost	$     110		$   6,010		$  2,498	$ 2,199

Effective April 30, 2012, the Astoria Federal Savings and Loan Association Employees’ Pension Plan, the Astoria Federal Savings and Loan Association Excess Benefit Plan, the Astoria Federal Savings and Loan Association Supplemental Benefit Plan and the Astoria Federal Savings and Loan Association Directors’ Retirement Plan were amended to, among other things, change the manner in which benefits were computed for service through April 30, 2012 and to suspend accrual of additional benefits for all of the aforementioned plans effective April 30, 2012.  These

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amendments resulted in a significant reduction in net periodic cost for our defined benefit pension plans for periods subsequent to April 30, 2012.

10.    Stock Incentive Plans

During the nine months ended September 30, 2013, 494,420 shares of restricted common stock were granted to select officers under the 2005 Re-designated, Amended and Restated Stock Incentive Plan for Officers and Employees of Astoria Financial Corporation, or the 2005 Employee Stock Plan, of which 467,070 shares vest one-third per year on or about December 16, beginning December 16, 2013, 1,000 shares vest on December 16, 2013, 6,000 shares vest one-third per year on or about January 7, beginning January 7, 2014, 1,500 shares vest on December 15, 2014, 2,500 shares vest on December 14, 2015 and 16,350 were forfeited as of September 30, 2013.  In the event the grantee terminates his/her employment due to death or disability, or in the event we experience a change in control, as defined and specified in the 2005 Employee Stock Plan, all restricted common stock granted pursuant to such plan immediately vests.

During the nine months ended September 30, 2013, 41,690 shares of restricted common stock were granted to directors under the Astoria Financial Corporation 2007 Non-Employee Directors Stock Plan, as amended, of which 36,020 remain outstanding at September 30, 2013 and vest 100% in January 2016, although awards immediately vest upon death, disability, mandatory retirement, involuntary termination or a change in control, as such terms are defined in the plan.

The following table summarizes restricted common stock activity in our stock incentive plans for the nine months ended September 30, 2013.

	Number ofShares		Weighted AverageGrant Date Fair Value
Nonvested at January 1, 2013	1,146,657		$  14.87
Granted	536,110		9.70
Vested	(297,305	)	(22.76	)
Forfeited	(90,306	)	(11.00	)
Nonvested at September 30, 2013	1,295,156		11.19

In addition to the activity described above, during the 2013 first quarter, 432,300 performance-based restricted stock units were granted to select officers under the 2005 Employee Stock Plan, with a grant date fair value of $9.22 per unit, of which 415,900 units remain outstanding at September 30, 2013.  Each restricted stock unit granted represents a right, under the 2005 Employee Stock Plan, to receive one share of our common stock in the future, subject to meeting certain criteria.  The restricted stock units have specified performance objectives within a specified performance measurement period and no voting or dividend rights prior to vesting and delivery of shares.  The performance measurement period for these restricted stock units is the fiscal year ending December 31, 2015 and the vest date is February 1, 2016.  Shares will be issued on the vest date at either 100%, 75%, 50% or 0% of units granted based on actual performance during the performance measurement period.  However, in the event of a change in control during the performance measurement period, the restricted stock units will vest on the change in control date and shares will be issued at 100% of units granted.  Absent a change in control, if a grantee’s employment terminates prior to December 31, 2015 all restricted stock units will be forfeited.  In the event the grantee terminates his/her employment during the period between December 31, 2015 and February 1, 2016 due to death, disability, retirement or a change in control, the grantee will remain entitled to the shares otherwise earned.

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Stock-based compensation expense is recognized on a straight-line basis over the vesting period and totaled $1.2 million, net of taxes of $636,000, for the three months ended September 30, 2013 and $3.4 million, net of taxes of $1.9 million, for the nine months ended September 30, 2013.  Stock-based compensation expense totaled $978,000, net of taxes of $533,000, for the three months ended September 30, 2012 and $2.4 million, net of taxes of $1.3 million, for the nine months ended September 30, 2012.  At September 30, 2013, pre-tax compensation cost related to all nonvested awards of restricted common stock and restricted stock units not yet recognized totaled $12.0 million and will be recognized over a weighted average period of approximately 2.0 years, which excludes $1.8 million of pre-tax compensation cost related to 65,000 shares of performance-based restricted common stock granted in 2011 and 103,975 performance-based restricted stock units granted in 2013, for which compensation cost will begin to be recognized when the achievement of the performance conditions becomes probable.

As a result of the resignation and retirement of several executive officers during the 2012 first quarter, the level of forfeitures in 2012 significantly exceeded our original estimate of restricted common stock forfeitures based on our prior experience.  As a result, we reversed stock-based compensation expense during the 2012 first quarter totaling $569,000, net of taxes of $310,000, representing stock-based compensation expense previously recognized on unvested shares of restricted common stock which will not vest as a result of forfeitures.

11.Fair Value Measurements

We use fair value measurements to record fair value adjustments to certain assets and liabilities and to determine fair value disclosures.  We group our assets and liabilities at fair value in three levels, based on the markets in which the assets are traded and the reliability of the assumptions used to determine fair value.  These levels are:

· Level 1 – Valuation is based upon quoted prices for identical instruments traded in active markets.

· Level 2 – Valuation is based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model-based valuation techniques for which all significant assumptions are observable in the market.

· Level 3 – Valuation is generated from model-based techniques that use significant assumptions not observable in the market. These unobservable assumptions reflect our own estimates of assumptions that market participants would use in pricing the asset or liability. Valuation techniques include the use of option pricing models, discounted cash flow models and similar techniques. The results cannot be determined with precision and may not be realized in an actual sale or immediate settlement of the asset or liability.

We base our fair values on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, with additional considerations when the volume and level of activity for an asset or liability have significantly decreased and on identifying circumstances that indicate a transaction is not orderly.  We maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.

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Recurring Fair Value Measurements

Our securities available-for-sale portfolio is carried at estimated fair value on a recurring basis, with any unrealized gains and losses, net of taxes, reported as accumulated other comprehensive income/loss in stockholders’ equity.  Additionally, in connection with our mortgage banking activities we have commitments to fund loans held-for-sale and commitments to sell loans, which are considered free-standing derivative instruments, the fair values of which are not material to our financial condition or results of operations.

The following tables set forth the carrying values of our assets measured at fair value on a recurring basis and the level within the fair value hierarchy in which the fair value measurements fall at the dates indicated.

	Carrying Value at September 30, 2013
(In Thousands)	Total	Level 1		Level 2
Securities available-for-sale:
Residential mortgage-backed securities:
GSE issuance REMICs and CMOs	$  296,966	$	—	$  296,966
Non-GSE issuance REMICs and CMOs	8,396	—		8,396
GSE pass-through certificates	17,957	—		17,957
Obligations of GSEs	92,430	—		92,430
Fannie Mae stock	1	1		—
Total securities available-for-sale	$  415,750	$	1	$  415,749

	Carrying Value at December 31, 2012
(In Thousands)	Total	Level 1		Level 2
Securities available-for-sale:
Residential mortgage-backed securities:
GSE issuance REMICs and CMOs	$  204,827	$	—	$  204,827
Non-GSE issuance REMICs and CMOs	11,219	—		11,219
GSE pass-through certificates	21,375	—		21,375
Obligations of GSEs	98,879	—		98,879
Fannie Mae stock	—	—		—
Total securities available-for-sale	$  336,300	$	—	$  336,300

The following is a description of valuation methodologies used for assets measured at fair value on a recurring basis.

Residential mortgage-backed securities

Residential mortgage-backed securities comprised 78% of our securities available-for-sale portfolio at September 30, 2013 and 71% at December 31, 2012.  The fair values for these securities are obtained from an independent nationally recognized pricing service.  Our pricing service uses various modeling techniques to determine pricing for our mortgage-backed securities, including option pricing and discounted cash flow models.  The inputs to these models include benchmark yields, reported trades, broker/dealer quotes, issuer spreads, benchmark securities, bids, offers, reference data, monthly payment information and collateral performance.  GSE securities, for which an active market exists for similar securities making observable inputs readily available, comprised 97% of our available-for-sale residential mortgage-backed securities portfolio at September 30, 2013 and 95% at December 31, 2012.

We review changes in the pricing service fair values from month to month taking into consideration changes in market conditions including changes in mortgage spreads, changes in treasury yields and changes in generic pricing on fifteen and thirty year securities.  Significant

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month over month price changes are analyzed further using discounted cash flow models and, on occasion, third party quotes.  Based upon our review of the prices provided by our pricing service, the estimated fair values incorporate observable market inputs commonly used by buyers and sellers of these types of securities at the measurement date in orderly transactions between market participants, and, as such, are classified as Level 2.

Obligations of GSEs

Obligations of GSEs comprised 22% of our securities available-for-sale portfolio at September 30, 2013 and 29% at December 31, 2012 and consisted of debt securities issued by GSEs.  The fair values for these securities are obtained from an independent nationally recognized pricing service.  Our pricing service gathers information from market sources and integrates relative credit information, observed market movements and sector news into their pricing applications and models.  Spread scales, representing credit risk, are created and are based on the new issue market, secondary trading and dealer quotes.  Option adjusted spread, or OAS, models are incorporated to adjust spreads of issues that have early redemption features.  Based upon our review of the prices provided by our pricing service, the estimated fair values incorporate observable market inputs commonly used by buyers and sellers of these types of securities at the measurement date in orderly transactions between market participants, and, as such, are classified as Level 2.

Fannie Mae stock

The fair value of the Fannie Mae stock in our available-for-sale securities portfolio is obtained from quoted market prices for identical instruments in active markets and, as such, is classified as Level 1.

Non-Recurring Fair Value Measurements

From time to time, we may be required to record at fair value assets or liabilities on a non-recurring basis, such as mortgage servicing rights, or MSR, loans receivable, certain assets held-for-sale and real estate owned, or REO.  These non-recurring fair value adjustments involve the application of lower of cost or market accounting or impairment write-downs of individual assets.

The following table sets forth the carrying values of those of our assets which were measured at fair value on a non-recurring basis at the dates indicated.  The fair value measurements for all of these assets fall within Level 3 of the fair value hierarchy.

	Carrying Value
(In Thousands)	At September 30, 2013	At December 31, 2012
Non-performing loans held-for-sale, net	$884	$3,881
Impaired loans	265,698	282,723
MSR, net	10,835	6,947
REO, net	20,903	20,796
Total	$ 298,320	$ 314,347

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The following table provides information regarding the losses recognized on our assets measured at fair value on a non-recurring basis for the periods indicated.

	For the Nine Months Ended September 30,
(In Thousands)	2013	2012
Non-performing loans held-for-sale, net (1)	$     567	$     696
Impaired loans (2)	16,698	31,555
MSR, net (3)	—	1,089
REO, net (4)	2,630	3,093
Total	$  19,895	$  36,433

(1)	Losses are charged against the allowance for loan losses in the case of a write-down upon the reclassification of a loan to held-for-sale. Losses subsequent to the reclassification of a loan to held-for-sale are charged to other non-interest income.
(2)	Losses are charged against the allowance for loan losses.
(3)	Losses are charged to mortgage banking income, net.
(4)	Losses are charged against the allowance for loan losses in the case of a write-down upon the transfer of a loan to REO. Losses subsequent to the transfer of a loan to REO are charged to REO expense which is a component of other non-interest expense.

The following is a description of valuation methodologies used for assets measured at fair value on a non-recurring basis.

Loans-held-for-sale, net (non-performing loans held-for-sale)

Fair values of non-performing loans held-for-sale are estimated through either preliminary bids from potential purchasers of the loans or the estimated fair value of the underlying collateral discounted for factors necessary to solicit acceptable bids, and adjusted as necessary based on management’s experience with sales of similar types of loans and, as such, are classified as Level 3.  Non-performing loans held-for-sale were comprised primarily of multi-family mortgage loans at September 30, 2013.  Substantially all of the non-performing loans held-for-sale were multi-family mortgage loans at December 31, 2012.

Loans receivable, net (impaired loans)

Loans which meet certain criteria are evaluated individually for impairment.  A loan is considered impaired when, based upon current information and events, it is probable that we will be unable to collect all amounts due, including principal and interest, according to the contractual terms of the loan agreement.  Impaired loans were comprised of 81% residential mortgage loans and 19% multi-family and commercial real estate mortgage loans at September 30, 2013 and 78% residential mortgage loans and 22% multi-family and commercial real estate mortgage loans at December 31, 2012.  Impaired loans for which a fair value adjustment was recognized were comprised of 84% residential mortgage loans and 16% multi-family and commercial real estate mortgage loans at September 30, 2013 and December 31, 2012.  Our impaired loans are generally collateral dependent and, as such, are generally carried at the estimated fair value of the collateral less estimated selling costs.

We obtain updated estimates of collateral values on residential mortgage loans at 180 days past due and earlier in certain instances, including for loans to borrowers who have filed for bankruptcy, and, to the extent the loans remain delinquent, annually thereafter.  Updated estimates of collateral value on residential loans are obtained primarily through automated valuation models.  Additionally, our loan servicer performs property inspections to monitor and manage the collateral on our residential loans when they become 45 days past due and monthly thereafter until the foreclosure process is complete.  We obtain updated estimates of collateral

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value using third party appraisals on non-performing multi-family and commercial real estate loans when the loans initially become non-performing and annually thereafter and multi-family and commercial real estate loans modified in a TDR at the time of the modification and annually thereafter.  Appraisals on multi-family and commercial real estate loans are reviewed by our internal certified appraisers.  Adjustments to final appraised values obtained from independent third party appraisers and automated valuation models are not made.  The fair values of impaired loans cannot be determined with precision and may not be realized in an actual sale or immediate settlement of the loan and, as such, are classified as Level 3.

MSR, net

The right to service loans for others is generally obtained through the sale of residential mortgage loans with servicing retained.  MSR are carried at the lower of cost or estimated fair value.  The estimated fair value of MSR is obtained through independent third party valuations through an analysis of future cash flows, incorporating estimates of assumptions market participants would use in determining fair value including market discount rates, prepayment speeds, servicing income, servicing costs, default rates and other market driven data, including the market’s perception of future interest rate movements and, as such, are classified as Level 3.  At September 30, 2013, our MSR were valued based on expected future cash flows considering a weighted average discount rate of 10.42%, a weighted average constant prepayment rate on mortgages of 14.64% and a weighted average life of 5.2 years.  At December 31, 2012, our MSR were valued based on expected future cash flows considering a weighted average discount rate of 10.95%, a weighted average constant prepayment rate on mortgages of 23.12% and a weighted average life of 3.4 years.  Management reviews the assumptions used to estimate the fair value of MSR to ensure they reflect current and anticipated market conditions.

REO, net

REO represents real estate acquired as a result of foreclosure or by deed in lieu of foreclosure, all of which were residential properties at September 30, 2013 and December 31, 2012, and is carried, net of allowances for losses, at the lower of cost or fair value less estimated selling costs.  The fair value of REO is estimated through current appraisals, in conjunction with a drive-by inspection and comparison of the REO property with similar properties in the area by either a licensed appraiser or real estate broker.  As these properties are actively marketed, estimated fair values are periodically adjusted by management to reflect current market conditions and, as such, are classified as Level 3.

Fair Value of Financial Instruments

Quoted market prices available in formal trading marketplaces are typically the best evidence of the fair value of financial instruments.  In many cases, financial instruments we hold are not bought or sold in formal trading marketplaces.  Accordingly, fair values are derived or estimated based on a variety of valuation techniques in the absence of quoted market prices.  Fair value estimates are made at a specific point in time, based on relevant market information about the financial instrument.  These estimates do not reflect any possible tax ramifications, estimated transaction costs, or any premium or discount that could result from offering for sale at one time our entire holdings of a particular financial instrument.  Because no market exists for a certain portion of our financial instruments, fair value estimates are based on judgments regarding future loss experience, current economic conditions, risk characteristics and other such factors.  These estimates are subjective in nature, involve uncertainties and, therefore, cannot be determined with precision.  Changes in assumptions could significantly affect the estimates.  For these

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reasons and others, the estimated fair value disclosures presented herein do not represent our entire underlying value.  As such, readers are cautioned in using this information for purposes of evaluating our financial condition and/or value either alone or in comparison with any other company.

The following tables set forth the carrying values and estimated fair values of our financial instruments which are carried on the consolidated statements of financial condition at either cost or at lower of cost or fair value in accordance with GAAP, and are not measured or recorded at fair value on a recurring basis, and the level within the fair value hierarchy in which the fair value measurements fall at the dates indicated.

	At September 30, 2013
	Carrying		Estimated Fair Value
(In Thousands)	Value		Total		Level 2		Level 3
Financial Assets:
Securities held-to-maturity	$	1,915,461	$	1,896,771	$	1,896,771	$	—
FHLB-NY stock	153,217		153,217		153,217		—
Loans held-for-sale, net (1)	10,485		10,866		—		10,866
Loans receivable, net (1)	12,398,543		12,630,027		—		12,630,027
MSR, net (1)	10,835		10,838		—		10,838
Financial Liabilities:
Deposits	10,060,374		10,140,390		10,140,390		—
Borrowings, net	4,109,028		4,374,578		4,374,578		—

(1)Includes assets measured at fair value on a non-recurring basis.

	At December 31, 2012
	Carrying		Estimated Fair Value
(In Thousands)	Value		Total		Level 2		Level 3
Financial Assets:
Securities held-to-maturity	$	1,700,141	$	1,725,090	$	1,725,090	$	—
FHLB-NY stock	171,194		171,194		171,194		—
Loans held-for-sale, net (1)	76,306		78,486		—		78,486
Loans receivable, net (1)	13,078,471		13,311,997		—		13,311,997
MSR, net (1)	6,947		6,948		—		6,948
Financial Liabilities:
Deposits	10,443,958		10,588,073		10,588,073		—
Borrowings, net	4,373,496		4,857,989		4,857,989		—

(1)Includes assets measured at fair value on a non-recurring basis.

The following is a description of the methods and assumptions used to estimate fair values of our financial instruments which are not measured or recorded at fair value on a recurring or non-recurring basis.

Securities held-to-maturity

The fair values for substantially all of our securities held-to-maturity are obtained from an independent nationally recognized pricing service using similar methods and assumptions as used for our securities available-for-sale which are measured at fair value on a recurring basis.

FHLB-NY stock

The fair value of FHLB-NY stock is based on redemption at par value.

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Loans held-for-sale, net

The fair values of fifteen and thirty year conforming fixed rate residential mortgage loans originated for sale are estimated using an option-based pricing methodology designed to take into account interest rate volatility, which has a significant effect on the value of the options and structural features embedded in loans.  This methodology involves generating simulated interest rates, calculating the OAS of a mortgage-backed security whose price is known, which serves as a benchmark price, and using the benchmark OAS to estimate the pricing for similar mortgage instruments whose prices are not known.

Loans receivable, net

Fair values of loans are estimated using an option-based pricing methodology designed to take into account interest rate volatility, which has a significant effect on the value of the options and structural features embedded in loans.  This pricing methodology involves generating simulated interest rates, calculating the OAS of a mortgage-backed security whose price is known, which serves as a benchmark price, and using the benchmark OAS to estimate the pricing for similar mortgage instruments whose prices are not known.

This technique of estimating fair value is extremely sensitive to the assumptions and estimates used.  While we have attempted to use assumptions and estimates which are the most reflective of the loan portfolio and the current market, a greater degree of subjectivity is inherent in determining these fair values than for fair values obtained from formal trading marketplaces.  In addition, our valuation method for loans, which is consistent with accounting guidance, does not fully incorporate an exit price approach to fair value.

Deposits

The fair values of deposits with no stated maturity, such as savings, money market and NOW and demand deposit accounts, are equal to the amount payable on demand.  The fair values of certificates of deposit are based on discounted contractual cash flows using the weighted average remaining life of the portfolio discounted by the corresponding LIBOR Swap Curve.

Borrowings, net

The fair values of borrowings are based upon third party dealers’ estimated market values which are reviewed by management quarterly using an OAS model.

Outstanding commitments

Outstanding commitments include commitments to extend credit and unadvanced lines of credit for which fair values were estimated based on an analysis of the interest rates and fees currently charged to enter into similar transactions.  The fair values of these commitments are immaterial to our financial condition.

12.Litigation

In the ordinary course of our business, we are routinely made a defendant in or a party to pending or threatened legal actions or proceedings which, in some cases, seek substantial monetary damages from or other forms of relief against us.  In our opinion, after consultation with legal counsel, we believe it unlikely that such actions or proceedings will have a material adverse effect on our financial condition, results of operations or liquidity.

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City of New York Notice of Determination

By “Notice of Determination” dated September 14, 2010 and August 26, 2011, the City of New York notified us of alleged tax deficiencies in the amount of $13.3 million, including interest and penalties, related to our 2006 through 2008 tax years.  The deficiencies relate to our operation of two subsidiaries of Astoria Federal, Fidata Service Corp., or Fidata, and Astoria Federal Mortgage Corp., or AF Mortgage.  We disagree with the assertion of the tax deficiencies.  Hearings in this matter were held before the New York City Tax Appeals Tribunal, or the NYC Tax Appeals Tribunal, in March and April 2013.  The NYC Tax Appeals Tribunal is not expected to render a decision in this matter until the 2014 third quarter.  At this time, management believes it is more likely than not that we will succeed in refuting the City of New York’s position, although defense costs may be significant.  Accordingly, no liability or reserve has been recognized in our consolidated statement of financial condition at September 30, 2013 with respect to this matter.

No assurance can be given as to whether or to what extent we will be required to pay the amount of the tax deficiencies asserted by the City of New York, whether additional tax will be assessed for years subsequent to 2008, that this matter will not be costly to oppose, that this matter will not have an impact on our financial condition or results of operations or that, ultimately, any such impact will not be material.

Automated Transactions LLC Litigation

In November 2009, an action entitled Automated Transactions LLC v. Astoria Financial Corporation and Astoria Federal Savings and Loan Association was commenced in the U.S. District Court for the Southern District of New York, or the Southern District Court, against us by Automated Transactions LLC, alleging patent infringement involving integrated banking and transaction machines, including automated teller machines, or ATMs, that we utilize.  The plaintiff sought unspecified monetary damages and an injunction preventing us from continuing to utilize the allegedly infringing machines.  In March 2011, the Southern District Court dismissed all claims against Astoria Financial Corporation but denied our motion to dismiss the claims against Astoria Federal for alleged direct patent infringement.

In July 2012, we filed a motion for summary judgment for non-infringement based on a ruling by the U.S. Court of Appeals for the Federal District affirming the decision of the U.S. District Court for the District of Delaware, or the Delaware District Court, to grant summary judgment in favor of a defendant in an action involving the same plaintiff making substantially similar allegations with respect to identical and substantially similar patents as those involved in the action against us.  In April 2013, the U.S. Judicial Panel on Multidistrict Litigation transferred this action to the Delaware District Court to be centralized with other cases involving the same plaintiff and common questions of fact.

We settled this litigation, and the case was dismissed with prejudice, pursuant to a stipulation and order of dismissal on September 19, 2013.  The settlement was not material to our financial condition or results of operations and will not result in any restrictions or alteration in the use of our ATMs.  We intend to continue to pursue our demands for indemnification from the manufacturer and from the transaction processor utilized with respect to the integrated banking machines.

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ITEM 2.Management’s Discussion and Analysis of Financial Condition and Results of Operations

This Quarterly Report on Form 10-Q contains a number of forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act.  These statements may be identified by the use of the words “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “may,” “outlook,” “plan,” “potential,” “predict,” “project,” “should,” “will,” “would” and similar terms and phrases, including references to assumptions.

Forward-looking statements are based on various assumptions and analyses made by us in light of our management’s experience and perception of historical trends, current conditions and expected future developments, as well as other factors we believe are appropriate under the circumstances.  These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors (many of which are beyond our control) that could cause actual results to differ materially from future results expressed or implied by such forward-looking statements.  These factors include, without limitation, the following:

·the timing and occurrence or non-occurrence of events may be subject to circumstances beyond our control;

·there may be increases in competitive pressure among financial institutions or from non-financial institutions;

·changes in the interest rate environment may reduce interest margins or affect the value of our investments;

·changes in deposit flows, loan demand or real estate values may adversely affect our business;

·changes in accounting principles, policies or guidelines may cause our financial condition to be perceived differently;

·general economic conditions, either nationally or locally in some or all areas in which we do business, or conditions in the real estate or securities markets or the banking industry may be less favorable than we currently anticipate;

·legislative or regulatory changes, including the implementation of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, or the Reform Act, and any actions regarding foreclosures, may adversely affect our business;

·enhanced supervision and examination by the Office of the Comptroller of the Currency, or OCC, the Board of Governors of the Federal Reserve System, or the FRB, and the Consumer Financial Protection Bureau;

·effects of changes in existing U.S. government or government-sponsored mortgage programs;

·technological changes may be more difficult or expensive than we anticipate;

·success or consummation of new business initiatives may be more difficult or expensive than we anticipate; or

·litigation or other matters before regulatory agencies, whether currently existing or commencing in the future, may be determined adverse to us or may delay the occurrence or non-occurrence of events longer than we anticipate.

We have no obligation to update any forward-looking statements to reflect events or circumstances after the date of this document.

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Executive Summary

The following overview should be read in conjunction with our MD&A in its entirety.

Astoria Financial Corporation is a Delaware corporation organized as the unitary savings and loan holding company of Astoria Federal.  As the premier Long Island community bank, our goals are to enhance shareholder value while continuing to build a solid banking franchise.  We focus on growing our core businesses of mortgage portfolio lending and retail banking while maintaining strong asset quality and controlling operating expenses.  We have been developing strategies to diversify earning assets and to increase low cost core deposits.  These strategies include a greater level of participation in the multi-family and commercial real estate mortgage lending markets and, over time, expanding our array of business banking products and services, focusing on small and mid-sized businesses with an emphasis on attracting clients from larger competitors.  We are also exploring the selective expansion of our branch network into Manhattan and additional locations on Long Island.  During the 2013 third quarter, we opened our first business banking office in midtown Manhattan and continue to look for other prime locations to open our first branch in Manhattan from which to better serve and build our business banking relationships.

We are impacted by both national and regional economic factors with residential mortgage loans from various regions of the country held in our portfolio and our multi-family and commercial real estate mortgage loan portfolio concentrated in the New York metropolitan area.  Although the U.S. economy has shown signs of modest improvement, the operating environment continues to remain challenging.  Interest rates have been at or near historic lows and we expect them to remain low for the near term.  However, long-term interest rates moved higher during the latter part of the 2013 second quarter and into the 2013 third quarter, with the ten year U.S. Treasury rate increasing from 1.63% at May 1, 2013 to 2.49% at the end of June and 2.61% at the end of September.  The national unemployment rate, while remaining high, declined to 7.2% for September 2013, compared to a peak of 10.0% for October 2009, and new job growth, while remaining slow, has continued in 2013.  Softness persists in the housing and real estate markets, although the extent of such softness varies from region to region.  However, we believe market conditions remain favorable in the New York metropolitan area with respect to our multi-family mortgage loan origination activities.

In addition to the challenging economic environment in which we compete, the regulation and oversight of our business has changed significantly in recent years.  As described in more detail in Part I, Item 1A, “Risk Factors,” in our 2012 Annual Report on Form 10-K, as supplemented by Part II, Item 1A, “Risk Factors,” in our June 30, 2013 Quarterly Report on Form 10-Q, certain aspects of the Reform Act continue to have a significant impact on us. In July 2013, the federal bank regulatory agencies, or the Agencies, approved rules that will subject many savings and loan holding companies, including Astoria Financial Corporation, to consolidated capital requirements which will be phased in with the initial provisions effective for us on January 1, 2015.  The rules also revise the quantity and quality of required minimum risk-based and leverage capital requirements applicable to Astoria Federal and Astoria Financial Corporation and revise the calculation of risk-weighted assets to enhance their risk sensitivity. We continue to review and prepare for the impact that the Reform Act, the Third Basel Accord adopted by the Basel Committee on Banking Supervision, or Basel III, capital standards and related rulemaking will have on our business, financial condition and results of operations.

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Net income available to common shareholders for the three and nine months ended September 30, 2013 increased compared to the three and nine months ended September 30, 2012, reflecting increases in net income which were offset in part by dividends declared on our preferred stock, which was issued in the 2013 first quarter.  The increase in net income for the three months ended September 30, 2013, compared to the three months ended September 30, 2012, primarily reflects a lower provision for loan losses, partially offset by a reduction in non-interest income.  The increase in net income for the nine months ended September 30, 2013, compared to the nine months ended September 30, 2012, was primarily attributable to a decline in the provision for loan losses and a reduction in non-interest expense, partially offset by lower net interest income.

Net interest income for the three months ended September 30, 2013 increased slightly compared to the three months ended September 30, 2012 due to a slightly greater reduction in interest expense than the decline in interest income.  For the nine months ended September 30, 2013, a decline in interest income exceeded a decline in interest expense, resulting in lower net interest income compared to the nine months ended September 30, 2012.  The continued low interest rate environment, coupled with the restructuring of $1.35 billion of borrowings in the 2013 second and third quarters and the prepayment of our Junior Subordinated Debentures in the 2013 second quarter, has resulted in the average cost of interest-bearing liabilities declining more than the average yield on interest-earning assets and an improvement in our net interest rate spread for the three and nine months ended September 30, 2013 compared to the three and nine months ended September 30, 2012.  The restructuring of borrowings in 2013 resulted in a 94 basis point decline in the weighted average rate on such borrowings.  For the 2013 third quarter, the decline in the average cost of interest-bearing liabilities more than offset the impact of the decline in the average balance of interest-earning assets, resulting in the slight improvement in net interest income compared to the 2012 third quarter.  This improvement in the 2013 third quarter had the impact of lessening the decline in net interest income for the nine months ended September 30, 2013 compared to the nine months ended September 30, 2012.  The net interest margin also increased for the 2013 third quarter and nine months ended September 30, 2013 compared to the 2012 third quarter and nine months ended September 30, 2012.

The provision for loan losses for the 2013 third quarter totaled $2.5 million resulting in a provision for loan losses of $16.2 million for the nine months ended September 30, 2013, compared to $9.5 million for the 2012 third quarter and $29.5 million for the nine months ended September 30, 2012.  The decline in the provision for loan losses reflects the continued improvement in net loan charge-offs and delinquent and non-performing loans during the 2013 third quarter, as well as the contraction of the overall loan portfolio.  The allowance for loan losses totaled $143.0 million at September 30, 2013, compared to $145.5 million at December 31, 2012.  While the level of loans past due 90 days or more has continued its downward trend during the first nine months of 2013, we expect the levels will remain somewhat elevated for some time, especially in certain states where judicial foreclosure proceedings are required.  Notwithstanding the decline in total delinquencies, our non-performing loans increased as of September 30, 2013 compared to December 31, 2012.  This increase was primarily attributable to the inclusion of bankruptcy loans discharged prior to 2012 which were current or less than 90 days past due, which totaled $49.9 million at September 30, 2013, as non-performing loans.  Effective in the 2013 first quarter, in addition to bankruptcy loans placed on non-accrual status and reported as non-performing loans as of December 31, 2012, we also included bankruptcy

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loans discharged prior to 2012 regardless of the delinquency status of the loans.  Such loans continue to generate interest income on a cash basis as payments are received.

Non-interest income decreased for the 2013 third quarter compared to the 2012 third quarter primarily due to decreases in customer service fees and income from bank owned life insurance.  For the nine months ended September 30, 2013, non-interest income increased slightly, in relation to the comparable 2012 period, as higher mortgage banking income, net, was substantially offset by lower customer service fees, income from bank owned life insurance, gain on sales of securities and other loan fees.

Non-interest expense for the 2013 third quarter was essentially the same as the 2012 third quarter primarily due to lower federal deposit insurance premium expense in 2013 and an extinguishment of debt expense recorded in the 2012 third quarter, the effects of which were substantially offset by increased compensation and benefits expense and other non-interest expense.  For the nine months ended September 30, 2013, non-interest expense decreased compared to the nine months ended September 30, 2012.  This decline reflects lower federal deposit insurance premium expense, compensation and benefits expense and other non-interest expense, partially offset by increases in occupancy, equipment and systems expense and extinguishment of debt expense.

Total assets declined during the nine months ended September 30, 2013, primarily reflecting a decrease in our residential mortgage loan portfolio which was partially offset by increases in our multi-family and commercial real estate mortgage loan portfolio and our securities portfolio.  At September 30, 2013, our multi-family and commercial real estate mortgage loan portfolio represented 32% of our total loan portfolio, up from 24% at December 31, 2012, reflecting our continued focus on the strategic shift in our balance sheet.  The decrease in our residential mortgage loan portfolio is the result of continued elevated levels of mortgage loan repayments which exceeded our origination and purchase volume in the first nine months of 2013.  With historic low interest rates for thirty year fixed rate conforming mortgage loans, which we generally do not retain for our portfolio, such loans continue to be a more attractive alternative for borrowers than the hybrid adjustable rate mortgage loan product that we retain for our portfolio.  Our residential mortgage loan origination and purchase volume continues to be negatively affected by this interest rate environment.

Total deposits decreased during the nine months ended September 30, 2013 as a result of a decline in certificates of deposit, partially offset by a net increase in our core deposits, reflecting increases in money market and NOW and demand deposit accounts which more than offset a decline in savings accounts.  At September 30, 2013, core deposits represented 66% of total deposits, up from 62% at December 31, 2012.  Total deposits included $689.6 million of business deposits at September 30, 2013, an increase of 41% since December 31, 2012, substantially all of which were core deposits, reflecting the expansion of our business banking operations, a component of the strategic shift in our balance sheet.  Total borrowings declined since December 31, 2012 reflecting a decline in FHLB-NY advances and the prepayment of our Junior Subordinated Debentures, partially offset by our use of short-term federal funds purchased in 2013.

Stockholders’ equity increased as of September 30, 2013 compared to December 31, 2012.  The increase was primarily attributed to the issuance of the preferred stock in the 2013 first quarter

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and net income for the first nine months of 2013, partially offset by dividends on common and preferred stock.

While the operating environment continues to remain challenging, we are encouraged by the steepening of the yield curve over the last several months which we believe will have positive effects.  We believe higher long-term interest rates should make our residential hybrid ARM loan products more attractive to borrowers and should lead to a continued slowdown of residential loan prepayments, which we have already experienced near the end of the 2013 third quarter.  We believe these factors should lead to a stabilization of our residential mortgage loan portfolio and growth in the total loan portfolio.  A sustained reduction in loan prepayments would also lead to a reduction in the premium amortization expense associated with the loans providing us with yet an additional benefit.  Our focus continues to be on the strategic shift in our balance sheet through the repositioning of assets and liabilities.  We continue to concentrate on growing our multi-family and commercial real estate mortgage loan portfolio, reducing certificates of deposit and increasing core deposits, all of which should continue to positively impact the net interest margin.  We expect to continue to add new team members to our business banking operations as well as strategically located new branches from which to service our customers over the coming months.

Available Information

Our internet website address is www.astoriafederal.com.  Our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and all amendments to those reports can be obtained free of charge from our investor relations website at http://ir.astoriafederal.com.  The above reports are available on our website as soon as reasonably practicable after we file such material with, or furnish such material to, the SEC.  Such reports are also available on the SEC’s website at www.sec.gov/edgar/searchedgar/webusers.htm.

Critical Accounting Policies

Note 1 of Notes to Consolidated Financial Statements in Part II, Item 8, “Financial Statements and Supplementary Data,” of our 2012 Annual Report on Form 10-K, as supplemented by our March 31, 2013 and June 30, 2013 Quarterly Reports on Form 10-Q and this report, contains a summary of our significant accounting policies.  Various elements of our accounting policies, by their nature, are inherently subject to estimation techniques, valuation assumptions and other subjective assessments.  Our policies with respect to the methodologies used to determine the allowance for loan losses, the valuation of MSR, judgments regarding goodwill and securities impairment and the estimates related to our pension plans and other postretirement benefits are our most critical accounting policies because they are important to the presentation of our financial condition and results of operations, involve a higher degree of complexity and require management to make difficult and subjective judgments which often require assumptions and estimates about highly uncertain matters.  Actual results may differ from our assumptions, estimates and judgments.  The use of different judgments, assumptions and estimates could result in material differences in our results of operations or financial condition.  These critical accounting policies are reviewed quarterly with the Audit Committee of our Board of Directors.  The following description of these policies should be read in conjunction with the corresponding section of our 2012 Annual Report on Form 10-K.

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Allowance for Loan Losses

We establish and maintain, through provisions for loan losses, an allowance for loan losses based on our evaluation of the probable inherent losses in our loan portfolio.  We evaluate the adequacy of our allowance on a quarterly basis.  The allowance is comprised of both valuation allowances related to individual loans and general valuation allowances, although the total allowance for loan losses is available for losses applicable to the entire loan portfolio.

In estimating specific allocations, we review loans deemed to be impaired and measure impairment losses based on either the fair value of collateral, the present value of expected future cash flows, or the loan’s observable market price.  A loan is considered impaired when, based upon current information and events, it is probable that we will be unable to collect all amounts due, including principal and interest, according to the contractual terms of the loan agreement. Factors considered by management in determining impairment include the financial condition of the borrower, payment history, delinquency status, collateral value and the probability of collecting principal and interest payments when due. When an impairment analysis indicates the need for a specific allocation on an individual loan, the amount must be sufficient to cover probable incurred losses at the evaluation date based on the facts and circumstances of the loan.  When available information confirms that specific loans, or portions thereof, are uncollectible, these amounts are promptly charged-off against the allowance for loan losses.

Loan reviews are performed by our Asset Review Department quarterly for all loans individually classified by our Asset Classification Committee and are performed annually for multi-family and commercial real estate loans modified in a TDR, residential loans with balances of $1.0 million or greater, multi-family and commercial real estate mortgage loans with balances of $5.0 million or greater and commercial loans with balances of $500,000 or greater.  Further, multi-family and commercial real estate portfolio management personnel also perform annual reviews for certain multi-family and commercial real estate mortgage loans with balances under $5.0 million and recommend further review by the Credit and Asset Review Departments as appropriate.  In addition, our Asset Review Department will review annually borrowing relationships whose combined outstanding balance is $5.0 million or greater, with such reviews covering approximately fifty percent of the outstanding principal balance of the loans to such relationships.

We obtain updated estimates of collateral values on, and individually evaluate for impairment, residential mortgage loans at 180 days past due and earlier in certain instances, including for loans to borrowers who have filed for bankruptcy, and, to the extent the loans remain delinquent, annually thereafter.  Updated estimates of collateral values on residential loans are obtained primarily through automated valuation models. Additionally, our loan servicer performs property inspections to monitor and manage the collateral on our residential loans when they become 45 days past due and monthly thereafter until the foreclosure process is complete. We obtain updated estimates of collateral value using third party appraisals on non-performing multi-family and commercial real estate mortgage loans when the loans initially become non-performing and annually thereafter and multi-family and commercial real estate loans modified in a TDR at the time of the modification and annually thereafter.  Appraisals on multi-family and commercial real estate loans are reviewed by our internal certified appraisers.  We also obtain updated estimates of collateral value for certain other loans when the Asset Classification Committee believes repayment of such loans may be dependent on the value of the underlying collateral.

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Adjustments to final appraised values obtained from independent third party appraisers and automated valuation models are not made.

Other current and anticipated economic conditions on which our individual valuation allowances rely are the impact that national and/or local economic and business conditions may have on borrowers, the impact that local real estate markets may have on collateral values, the level and direction of interest rates and their combined effect on real estate values and the ability of borrowers to service debt.  For multi-family and commercial real estate loans, additional factors specific to a borrower or the underlying collateral are considered.  These factors include, but are not limited to, the composition of tenancy, occupancy levels for the property, location of the property, cash flow estimates and, to a lesser degree, the existence of personal guarantees.  We also review all regulatory notices, bulletins and memoranda with the purpose of identifying upcoming changes in regulatory conditions which may impact our calculation of individual valuation allowances.  Our primary banking regulator periodically reviews our reserve methodology during regulatory examinations and any comments regarding changes to reserves or loan classifications are considered by management in determining valuation allowances.

Pursuant to our policy, loan losses are charged-off in the period the loans, or portions thereof, are deemed uncollectible for the portion of the recorded investment in the loan in excess of the estimated fair value of the underlying collateral less estimated selling costs or in excess of the present value of expected future cash flows.  Such charge-offs are taken primarily for residential mortgage loans at 180 days past due and annually thereafter.  These partial charge-offs on residential loans impact our credit quality metrics and trends.  The impact of updating the estimates of collateral value and recognizing any required charge-offs is to increase charge-offs and reduce the allowance for loan losses required on these loans.  We also evaluate, for potential charge-offs, loans modified in a TDR at the time of the modification and impaired multi-family and commercial real estate mortgage loans when the loans are identified as impaired.

The determination of the loans on which full collectibility is not reasonably assured, the estimates of the fair value of the underlying collateral and the assessment of economic and regulatory conditions are subject to assumptions and judgments by management.  Individual valuation allowances and charge-off amounts could differ materially as a result of changes in these assumptions and judgments.

Estimated losses for loans that are not individually deemed to be impaired are determined on a loan pool basis using our historical loss experience and various other qualitative factors and comprise our general valuation allowances.  General valuation allowances represent loss allowances that have been established to recognize the inherent risks associated with our lending activities which, unlike individual valuation allowances, have not been allocated to particular loans.  The determination of the adequacy of the general valuation allowances takes into consideration a variety of factors.  We segment our residential mortgage loan portfolio by interest-only and amortizing loans, full documentation and reduced documentation loans and year of origination and analyze our historical loss experience and delinquency levels and trends of these segments.  We analyze multi-family and commercial real estate loans by portfolio, geographic location and year of origination.  We analyze our consumer and other loan portfolio by home equity lines of credit, commercial loans, revolving credit lines and installment loans and perform similar historical loss analyses.  In our analysis of non-performing loans, we consider our aggregate historical loss experience with respect to the ultimate disposition of the underlying

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collateral along with the migration of delinquent loans based on the portfolio segments noted above.  These analyses and the resulting loss rates are used as an integral part of our judgment in developing estimated loss percentages to apply to the loan portfolio segments. We monitor credit risk on interest-only hybrid adjustable rate mortgage, or ARM, loans that were underwritten at the initial note rate, which may have been a discounted rate, in the same manner that we monitor credit risk on all interest-only hybrid ARM loans.  We monitor interest rate reset dates of our loan portfolio, in the aggregate, and the current interest rate environment and consider the impact, if any, on borrowers’ ability to continue to make timely principal and interest payments in determining our allowance for loan losses.  We also consider the size, composition, risk profile and delinquency levels of our loan portfolio, as well as our credit administration and asset management procedures.  We monitor property value trends in our market areas by reference to various industry and market reports, economic releases and surveys, and our general and specific knowledge of the real estate markets in which we lend, in order to determine what impact, if any, such trends may have on the level of our general valuation allowances.  In addition, we evaluate and consider the impact that current and anticipated economic and market conditions may have on the loan portfolio and known and inherent risks in the portfolio.  We update our analyses quarterly and continually refine our evaluations as experience provides clearer guidance, our product offerings change and as economic conditions evolve.

We analyze our historical loss experience over twelve, fifteen, eighteen and twenty-four month periods. The loss history used in calculating our quantitative allowance coverage percentages varies based on loan type.  Also, for a particular loan type we may not have sufficient loss history to develop a reasonable estimate of loss and consider our loss experience for other, similar loan types and may evaluate those losses over a longer period than two years.  Additionally, multi-family and commercial real estate loss experience may be adjusted based on the composition of the losses (loan sales, short sales and partial charge-offs).  We update our historical loss analyses quarterly and evaluate the need to modify our quantitative allowances as a result of our updated charge-off and loss analyses.

We consider qualitative factors with the purpose of assessing the adequacy of the overall allowance for loan losses as well as the allocation of the allowance for loan losses by portfolio.  The qualitative factors we consider generally include, but are not limited to, changes in (1) lending policies and procedures, (2) economic and business conditions and developments that affect collectibility of our loan portfolio, (3) the nature and volume of our loan portfolio and in the terms of loans, (4) the experience, ability and depth of lending management and other staff, (5) the volume and severity of past due, non-accrual and adversely classified loans, (6) the quality of the loan review system, (7) the value of underlying collateral, (8) the existence or effect of any credit concentrations and (9) external factors such as competition and legal or regulatory requirements.  In addition to the nine qualitative factors noted, we also review certain analytical information such as our coverage ratios and peer analysis.

We use ratio analyses as a supplemental tool for evaluating the overall reasonableness of the allowance for loan losses.  As such, we consider our asset quality ratios as well as the allowance ratios and coverage percentages set forth in both peer group and regulatory agency data.  We also consider any comments from our primary banking regulator resulting from their review of our general valuation allowance methodology during regulatory examinations.  We consider the observed trends in our asset quality ratios in combination with our primary focus on our historical loss experience and the impact of current economic conditions.  After evaluating these

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variables, we determine appropriate allowance coverage percentages for each of our portfolio segments and the appropriate level of our allowance for loan losses.  We do not determine the appropriate level of our allowance for loan losses based exclusively on a single factor or asset quality ratio.  We periodically review the actual performance and charge-off history of our loan portfolio and compare that to our previously determined allowance coverage percentages and individual valuation allowances.  In doing so, we evaluate the impact the previously mentioned variables may have had on the loan portfolio to determine which changes, if any, should be made to our assumptions and analyses.

Allowance adequacy calculations are adjusted quarterly, based on the results of our quantitative and qualitative analyses, to reflect our current estimates of the amount of probable losses inherent in our loan portfolio in determining our allowance for loan losses.  Allocations of the allowance to each loan category are adjusted quarterly to reflect probable inherent losses using the same quantitative and qualitative analyses used in connection with the overall allowance adequacy calculations.  Beginning with the 2013 first quarter, the allowance for loan losses allocated to residential mortgage loans over 180 days delinquent with a charge-off, previously determined within our qualitative analysis, is now determined within our quantitative analysis and presented as attributable to those loans individually evaluated for impairment.  The portion of the allowance allocated to each loan category does not represent the total available to absorb losses which may occur within the loan category, since the total allowance for loan losses is available for losses applicable to the entire loan portfolio.

As a result of our updated charge-off and loss analyses, we modified certain allowance coverage percentages during each quarter of 2013 to reflect our current estimates of the amount of probable inherent losses in our loan portfolio in determining our general valuation allowances.  In the 2013 third quarter, we further updated the method of determining our allowance level by (1) extending our evaluation of loss experience factors to consider trends in such factors over the prior two years for the majority of the loan portfolio, and (2) giving consideration to more detailed modeling techniques as an added factor for multi-family and commercial real estate loans originated since 2010.  Based on our evaluation of the composition and size of our loan portfolio, the levels and composition of our loan delinquencies and non-performing loans, our loss history, the housing and real estate markets and the current economic environment, we determined that an allowance for loan losses of $143.0 million was appropriate at September 30, 2013, compared to $143.9 million at June 30, 2013 and $145.5 million at December 31, 2012. The provision for loan losses totaled $16.2 million for the nine months ended September 30, 2013.

The balance of our allowance for loan losses represents management’s best estimate of the probable inherent losses in our loan portfolio at the reporting dates.  Actual results could differ from our estimates as a result of changes in economic or market conditions.  Changes in estimates could result in a material change in the allowance for loan losses.  While we believe that the allowance for loan losses has been established and maintained at levels that reflect the risks inherent in our loan portfolio, future adjustments may be necessary if portfolio performance or economic or market conditions differ substantially from the conditions that existed at the time of the initial determinations.

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For additional information regarding our allowance for loan losses, see “Provision for Loan Losses” and “Asset Quality” in this document and Part II, Item 7, “MD&A,” in our 2012 Annual Report on Form 10-K.

Valuation of MSR

The initial asset recognized for originated MSR is measured at fair value.  The fair value of MSR is estimated by reference to current market values of similar loans sold servicing released.  MSR are amortized in proportion to and over the period of estimated net servicing income.  We apply the amortization method for measurement of our MSR.  MSR are assessed for impairment based on fair value at each reporting date.  Impairment exists if the carrying value of MSR exceeds the estimated fair value. The estimated fair value of MSR is obtained through independent third party valuations.  MSR impairment, if any, is recognized in a valuation allowance through charges to earnings.  Increases in the fair value of impaired MSR are recognized only up to the amount of the previously recognized valuation allowance.

At September 30, 2013, our MSR had an estimated fair value of $10.8 million and were valued based on expected future cash flows considering a weighted average discount rate of 10.42%, a weighted average constant prepayment rate on mortgages of 14.64% and a weighted average life of 5.2 years.  At December 31, 2012, our MSR had an estimated fair value of $6.9 million and were valued based on expected future cash flows considering a weighted average discount rate of 10.95%, a weighted average constant prepayment rate on mortgages of 23.12% and a weighted average life of 3.4 years.

The fair value of MSR is highly sensitive to changes in assumptions.  Changes in prepayment speed assumptions generally have the most significant impact on the fair value of our MSR.  Generally, as interest rates decline, mortgage loan prepayments accelerate due to increased refinance activity, which results in a decrease in the fair value of MSR.  As interest rates rise, mortgage loan prepayments slow down, which results in an increase in the fair value of MSR.  Thus, any measurement of the fair value of our MSR is limited by the conditions existing and the assumptions utilized as of a particular point in time, and those assumptions may not be appropriate if they are applied at a different point in time.

Goodwill Impairment

Goodwill is presumed to have an indefinite useful life and is tested, at least annually, for impairment at the reporting unit level.  If the estimated fair value of the reporting unit exceeds its carrying amount, further evaluation is not necessary.  However, if the fair value of the reporting unit is less than its carrying amount, further evaluation is required to compare the implied fair value of the reporting unit’s goodwill to its carrying amount to determine if a write-down of goodwill is required.  Impairment exists when the carrying amount of goodwill exceeds its implied fair value.

For purposes of our goodwill impairment testing, we have identified a single reporting unit.  We consider the quoted market price of our common stock on our impairment testing date as an initial indicator of estimating the fair value of our reporting unit.  We also consider our average stock price, both before and after our impairment test date, as well as market-based control premiums in determining the estimated fair value of our reporting unit.  In addition to our internal goodwill impairment analysis, we periodically obtain a goodwill impairment analysis

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from an independent third party valuation firm.  The independent third party utilizes multiple valuation approaches including comparable transactions, control premium, public market peers and discounted cash flow.  Management reviews the assumptions and inputs used in the third party analysis for reasonableness.

At September 30, 2013, the carrying amount of our goodwill totaled $185.2 million.  As of September 30, 2013, we performed our annual goodwill impairment test internally and obtained an independent third party analysis and concluded there was no goodwill impairment.  We would test our goodwill for impairment between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of our reporting unit below its carrying amount.  The identification of additional reporting units, the use of other valuation techniques or changes to the input assumptions used in our analysis or the analysis by our third party valuation firm could result in materially different evaluations of impairment.

Securities Impairment

Our available-for-sale securities portfolio is carried at estimated fair value with any unrealized gains and losses, net of taxes, reported as accumulated other comprehensive income/loss in stockholders’ equity.  Debt securities which we have the positive intent and ability to hold to maturity are classified as held-to-maturity and are carried at amortized cost.  The fair values for our securities are obtained from an independent nationally recognized pricing service.

Our securities portfolio is comprised primarily of fixed rate mortgage-backed securities guaranteed by a GSE as issuer.  GSE issuance mortgage-backed securities comprised 92% of our securities portfolio at September 30, 2013.  Non-GSE issuance mortgage-backed securities at September 30, 2013 comprised 1% of our securities portfolio and had an amortized cost of $12.4 million, with 67% classified as available-for-sale and 33% are classified as held-to-maturity.  Substantially all of our non-GSE issuance securities are investment grade securities and have performed similarly to our GSE issuance securities.  Credit quality concerns have not significantly impacted the performance of our non-GSE securities or our ability to obtain reliable prices.  The balance of our securities portfolio is primarily comprised of debt securities issued by GSEs.

The fair value of our securities portfolio is primarily impacted by changes in interest rates.  We conduct a periodic review and evaluation of the securities portfolio to determine if a decline in the fair value of any security below its cost basis is other-than-temporary.  Our evaluation of other-than-temporary impairment, or OTTI, considers the duration and severity of the impairment, our assessments of the reason for the decline in value, the likelihood of a near-term recovery and our intent and ability to not sell the securities.  We generally view changes in fair value caused by changes in interest rates as temporary, which is consistent with our experience.  If such decline is deemed other-than-temporary, the security is written down to a new cost basis and the resulting loss is charged to earnings as a component of non-interest income, except for the amount of the total OTTI for a debt security that does not represent credit losses which is recognized in other comprehensive income/loss, net of applicable taxes.  At September 30, 2013, we held 91 securities with an estimated fair value totaling $1.26 billion which had an unrealized loss totaling $47.6 million.  Of the securities in an unrealized loss position at September 30, 2013, $95.7 million, with an unrealized loss of $4.0 million, had been in a continuous unrealized loss position for more than twelve months.  At September 30, 2013, the impairments were

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deemed temporary based on (1) the direct relationship of the decline in fair value to movements in interest rates, (2) the estimated remaining life and high credit quality of the investments and (3) the fact that we had no intention to sell these securities and it was not more likely than not that we would be required to sell these securities before their anticipated recovery of the remaining amortized cost basis and we expected to recover the entire amortized cost basis of the security.

Pension Benefits and Other Postretirement Benefit Plans

Astoria Federal has a qualified, non-contributory defined benefit pension plan covering employees meeting specified eligibility criteria.  Astoria Federal’s policy is to fund pension costs in accordance with the minimum funding requirement.  In addition, Astoria Federal has non-qualified and unfunded supplemental retirement plans covering certain officers and directors.  Effective April 30, 2012, the Astoria Federal Savings and Loan Association Employees’ Pension Plan, the Astoria Federal Savings and Loan Association Excess Benefit Plan, the Astoria Federal Savings and Loan Association Supplemental Benefit Plan and the Astoria Federal Savings and Loan Association Directors’ Retirement Plan were amended to, among other things, change the manner in which benefits were computed for service through April 30, 2012 and to suspend accrual of additional benefits for all of the aforementioned plans effective April 30, 2012.  We also sponsor a health care plan that provides for postretirement medical and dental coverage to select individuals.

We recognize the overfunded or underfunded status of our defined benefit pension plans and other postretirement benefit plan, which is measured as the difference between plan assets at fair value and the benefit obligation at the measurement date, in other assets or other liabilities in our consolidated statements of financial condition.  Changes in the funded status are recognized through other comprehensive income/loss in the period in which the changes occur.

There are several key assumptions which we provide our actuary which have a significant impact on the pension benefits and other postretirement benefit obligations as well as benefits expense.  These include the discount rate and the expected return on plan assets.  We continually review and evaluate all actuarial assumptions affecting the pension benefits and other postretirement benefit plans.  We monitor these rates in relation to the current market interest rate environment and update our actuarial analysis accordingly.

The discount rate is used to calculate the present value of the benefit obligations at the measurement date and the expense to be recorded in the following period.  A lower discount rate will result in a higher benefit obligation and expense, while a higher discount rate will result in a lower benefit obligation and expense.  Discount rate assumptions are determined by reference to the Citigroup Pension Discount Curve, adjusted for Astoria Federal benefit plan specific cash flows.  We compare these rates to other yield curves and market indices, such as the Mercer Mature Plan Index and Bloomberg AA Discount Curve, for reasonableness and make adjustments, as necessary, so the discount rates used reflect current market data and trends.

To determine the expected return on plan assets, we consider the long-term historical return information on plan assets, the mix of investments that comprise plan assets and the historical returns on indices comparable to the fund classes in which the plan invests.

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For further information on the actuarial assumptions used for our pension benefits and other postretirement benefit plans and the impact of the 2012 plan amendments, see Note 14 of Notes to Consolidated Financial Statements in Part II, Item 8, “Financial Statements and Supplementary Data” in our 2012 Annual Report on Form 10-K.

Liquidity and Capital Resources

Our primary source of funds is cash provided by principal and interest payments on loans and securities.  The most significant liquidity challenge we face is the variability in cash flows as a result of changes in mortgage refinance activity.  Principal payments on loans and securities totaled $3.41 billion for the nine months ended September 30, 2013, compared to $4.08 billion for the nine months ended September 30, 2012.  The decrease in loan and securities repayments for the nine months ended September 30, 2013, compared to the nine months ended September 30, 2012, was primarily due to a decrease in mortgage loan prepayments.  While residential mortgage loan prepayments declined during the nine months ended September 30, 2013 compared to the nine months ended September 30, 2012, they remained at elevated levels due to historic low interest rates for thirty year fixed rate conforming loans, thereby continuing to make such loans, which we generally do not retain for our portfolio, a more attractive alternative for borrowers than the hybrid ARM loan product that we retain for our portfolio.

In addition to cash provided by principal and interest payments on loans and securities, our other sources of funds include cash provided by operating activities, deposits and borrowings.  Net cash provided by operating activities totaled $189.1 million for the nine months ended September 30, 2013 and $187.7 million for the nine months ended September 30, 2012.  Deposits decreased $383.6 million during the nine months ended September 30, 2013 and decreased $706.7 million during the nine months ended September 30, 2012, due to decreases in certificates of deposit, partially offset by increases in core deposits.  During the nine months ended September 30, 2013 and 2012, we continued to allow high cost certificates of deposit to run off, while the increases in low cost core deposits appear to reflect customer preference for the liquidity these types of deposits provide.  In addition, total deposits included business deposits of $689.6 million at September 30, 2013, an increase of 41% since December 31, 2012, substantially all of which were core deposits, reflecting the expansion of our business banking operations, a component of the strategic shift in our balance sheet.  Net borrowings decreased $264.5 million during the nine months ended September 30, 2013 and increased $687.8 million during the nine months ended September 30, 2012.  The decrease in net borrowings during the nine months ended September 30, 2013 was primarily due to a decrease in FHLB-NY advances and the prepayment of our Junior Subordinated Debentures, partially offset by our use of short-term federal funds purchased in 2013.  The increase in net borrowings during the nine months ended September 30, 2012 was due to an increase in FHLB-NY advances, partially offset by a decrease in reverse repurchase agreements, and reflected our use of term borrowings to help manage interest rate risk.  The growth in core deposits and the declines in certificates of deposit and borrowings during the nine months ended September 30, 2013 reflect our efforts to reposition the liability mix of our balance sheet.  At September 30, 2013, core deposits represented 66% of total deposits, up from 62% at December 31, 2012.

Our primary use of funds is for the origination and purchase of mortgage loans and, to a lesser degree, for the purchase of securities.  Gross mortgage loans originated and purchased for portfolio during the nine months ended September 30, 2013 totaled $2.07 billion, compared to

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$3.52 billion during the nine months ended September 30, 2012.  The decline was attributable to residential loan originations and purchases which totaled $837.8 million during the nine months ended September 30, 2013, of which $492.7 million were residential loan originations and $345.1 million were purchases of individual residential mortgage loans through our third party loan origination program, compared to $2.30 billion during the nine months ended September 30, 2012, of which $1.45 billion were originations and $841.0 million were purchases.  Residential mortgage loan origination and purchase volume for portfolio has been negatively affected for an extended period of time by the historic low interest rates for thirty year fixed rate conforming mortgage loans and the expanded conforming loan limits established by the GSEs resulting in more borrowers opting for thirty year fixed rate conforming mortgage loans, which we generally do not retain for our portfolio, and a reduced demand for the hybrid ARM loan product that we retain for our portfolio.  Multi-family and commercial real estate loan originations totaled $1.23 billion during the nine months ended September 30, 2013, unchanged compared to originations during the nine months ended September 30, 2012, reflecting continued strong loan production as we concentrate on growing this portfolio.  Purchases of securities totaled $1.05 billion during the nine months ended September 30, 2013 and $741.2 million during the nine months ended September 30, 2012.

Our policies and procedures with respect to managing funding and liquidity risk are established to ensure our safe and sound operation in compliance with applicable bank regulatory requirements.  Our liquidity management process is sufficient to meet our daily funding needs and cover both expected and unexpected deviations from normal daily operations.  Processes are in place to appropriately identify, measure, monitor and control liquidity and funding risk.  The primary tools we use for measuring and managing liquidity risk include cash flow projections, diversified funding sources, stress testing, a cushion of liquid assets and contingency funding plans.

We maintain liquidity levels to meet our operational needs in the normal course of our business.  The levels of our liquid assets during any given period are dependent on our operating, investing and financing activities.  Cash and due from banks totaled $137.7 million at September 30, 2013 and $121.5 million at December 31, 2012.  At September 30, 2013, we had $1.06 billion in borrowings with a weighted average rate of 0.68% maturing over the next twelve months.  We have the flexibility to either repay or rollover these borrowings as they mature.  Included in our borrowings are various obligations which, by their terms, may be called by the counterparty.  At September 30, 2013 and December 31, 2012, we had $1.95 billion of callable borrowings, all of which at December 31, 2012 were contractually callable by the counterparty within three months and on a quarterly basis thereafter.  During the 2013 second and third quarters, we restructured $1.35 billion of these borrowings with the counterparties resulting in a reduction in the weighted average interest rate on such borrowings from 4.40% to 3.46% and an extension of terms from a weighted average remaining term at the time of the restructuring of approximately 4 years to approximately 7 years.  The restructuring also extended the contractual call dates on $950.0 million of these borrowings to 2017, on $100.0 million of these borrowings to 2016 and on $200.0 million of these borrowings to 2015.  Of the $1.95 billion of callable borrowings, $700.0 million at September 30, 2013 were contractually callable by the counterparty within three months and on a quarterly basis thereafter.  We believe the potential for these borrowings to be called does not present a liquidity concern as they have above current market coupons and, as such, are not likely to be called absent a significant increase in market interest rates.  In addition, to the extent such borrowings were to be called, we believe we could readily obtain replacement

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funding, although such funding may be at higher rates.  At September 30, 2013, FHLB-NY advances totaled $2.48 billion, or 60% of total borrowings.  We do not believe any of our borrowing counterparty concentrations represent a material risk to our liquidity.  See Note 5 of Notes to Consolidated Financial Statements, in Part I, Item 1, “Financial Statements (Unaudited),” for additional information on our borrowings.  In addition, we had $1.45 billion of certificates of deposit at September 30, 2013 with a weighted average rate of 0.92% maturing over the next twelve months.  We believe we have the ability to retain or replace a significant portion of such deposits based on our pricing and historical experience.

The following table details our borrowing and certificate of deposit maturities and their weighted average rates at September 30, 2013.

	Borrowings			Certificates of Deposit
(Dollars in Millions)	Amount		Weighted Average Rate	Amount	Weighted Average Rate
Contractual Maturity:
Twelve months or less	$ 1,061		0.68%	$ 1,453	0.92%
Thirteen to thirty-six months	850		1.11	1,749	2.08
Thirty-seven to sixty months	1,050	(1)	4.16	248	1.11
Over sixty months	1,150	(2)	3.54	1	1.57
Total	$ 4,111		2.46%	$ 3,451	1.52%

(1)	Includes $600.0 million of borrowings, with a weighted average rate of 4.19%, which are callable within the next three months and on a quarterly basis thereafter and $200.0 million of borrowings, with a weighted average rate of 3.03%, which are callable in 2015.
(2)	Includes $100.0 million of borrowings, with a rate of 4.05%, which are callable within the next three months and on a quarterly basis thereafter, $100.0 million of borrowings, with a rate of 3.66%, which are callable in 2016 and $950.0 million of borrowings, with a weighted average rate of 3.47%, which are callable in 2017.

We have filed automatic shelf registration statements on Form S-3 with the SEC, which allow us to periodically offer and sell, from time to time, in one or more offerings, individually or in any combination, common stock, preferred stock, debt securities, capital securities, guarantees, warrants to purchase common stock or preferred stock and units consisting of one or more of the foregoing.  These shelf registration statements provide us with greater capital management flexibility and enable us to more readily access the capital markets in order to pursue growth opportunities that may become available to us in the future or should there be any changes in the regulatory environment that call for increased capital requirements.  Although the shelf registration statements do not limit the amount of the foregoing items that we may offer and sell, our ability and any decision to do so is subject to market conditions and our capital needs.

On March 19, 2013, in a public offering, we sold 5,400,000 depositary shares, each representing a 1/40th interest in a share of our 6.50% Non-Cumulative Perpetual Preferred Stock, Series C, $1.00 par value per share, $1,000 liquidation preference per share (equivalent to $25 per depositary share).  We issued 135,000 shares of the Series C Preferred Stock in connection with the sale of the depositary shares.  The aggregate proceeds from the offering, net of underwriting discounts and other issuance costs, were approximately $129.8 million.

The Series C Preferred Stock, and corresponding depositary shares, may be redeemed at our option, in whole or in part, on April 15, 2018, or on any dividend payment date occurring thereafter, at a redemption price of $1,000 per share (equivalent to $25 per depositary share),

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plus any declared and unpaid dividends (without accumulation of any undeclared dividends).  The Series C Preferred Stock may also be redeemed in whole, but not in part, at any time upon the occurrence of a “regulatory capital treatment event,” as defined in the certificate of designations included in the registration statement on Form 8-A filed with the SEC on March 19, 2013.  The holders of the Series C Preferred Stock, and the corresponding depositary shares, do not have the right to require the redemption or repurchase of the Series C Preferred Stock.

Additional sources of liquidity at the holding company level have included private issuances of trust preferred securities and senior debt.  Holding company debt obligations are included in other borrowings.  Our ability to continue to access the capital markets for additional financing at favorable terms may be limited by, among other things, market conditions, interest rates, our capital levels, Astoria Federal’s ability to pay dividends to Astoria Financial Corporation, our credit profile and ratings and our business model.

Beginning in July 2013, dividends are payable on the Series C Preferred Stock when, as and if declared by our Board of Directors, on a non-cumulative basis quarterly in arrears on January 15, April 15, July 15 and October 15 of each year at an annual rate of 6.50% on the liquidation preference of $1,000 per share.  No dividend shall be declared, paid, or set aside for payment on our common stock unless the full dividends for the most recently completed dividend period have been declared and paid on our Series C Preferred Stock.

On May 10, 2013, we prepaid in whole our Junior Subordinated Debentures pursuant to the optional prepayment provisions of the indenture at a prepayment price of 103.413% of the $128.9 million aggregate principal amount, plus accrued and unpaid interest to, but not including, the date of repayment.  As a result of the prepayment in whole of the Junior Subordinated Debentures, Astoria Capital Trust I simultaneously applied the proceeds of such prepayment to redeem its $125.0 million aggregate liquidation amount of Capital Securities, as well as the $3.9 million of common securities owned by Astoria Financial Corporation.  The prepayment of the Junior Subordinated Debentures resulted in a $4.3 million prepayment charge in the 2013 second quarter for the early extinguishment of this debt.  See Note 1 and Note 5 of Notes to Consolidated Financial Statements, in Part I, Item 1, “Financial Statements (Unaudited),” for additional information regarding Astoria Capital Trust I, the Capital Securities and our Junior Subordinated Debentures.

Astoria Financial Corporation’s primary uses of funds include payment of dividends on common and preferred stock and payment of interest on its debt obligations.  During the nine months ended September 30, 2013, Astoria Financial Corporation paid dividends on common stock totaling $11.8 million.  On October 16, 2013, our Board of Directors declared a quarterly cash dividend of $0.04 per share on shares of our common stock payable on December 2, 2013 to stockholders of record as of November 15, 2013.  On June 19, 2013, our Board of Directors declared the first quarterly cash dividend on our Series C Preferred Stock aggregating $2.8 million, or $20.94 per share, for the dividend period from the issuance date of March 19, 2013 through and including July 14, 2013, which was paid on July 15, 2013 to stockholders of record as of June 30, 2013.  On September 18, 2013, our Board of Directors declared the second quarterly cash dividend on our Series C Preferred Stock aggregating $2.2 million, or $16.25 per share, for the quarterly period from July 15, 2013 through and including September 14, 2013, which was paid on October 15, 2013 to stockholders of record as of September 30, 2013.

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Our ability to pay dividends, service our debt obligations and repurchase common stock is dependent primarily upon receipt of capital distributions from Astoria Federal.  Since Astoria Federal is a federally chartered savings association, there are regulatory limits on its ability to make distributions to Astoria Financial Corporation.  See Part I, Item 1, “Regulation and Supervision,” in our 2012 Annual Report on Form 10-K for further discussion of these regulatory limits.  Astoria Federal paid dividends to Astoria Financial Corporation totaling $44.0 million during the nine months ended September 30, 2013.

See “Financial Condition” for further discussion of the changes in stockholders’ equity.

At September 30, 2013, our tangible common equity ratio, which represents common stockholders’ equity less goodwill divided by total assets less goodwill, was 7.22%.  At September 30, 2013, Astoria Federal’s capital levels exceeded all of its regulatory capital requirements with a Tangible capital ratio of 9.61%, Tier 1 leverage capital ratio of 9.61%, Total risk-based capital ratio of 16.87% and Tier 1 risk-based capital ratio of 15.61%.  As of September 30, 2013, Astoria Federal continues to be a well capitalized institution for all bank regulatory purposes.

Pursuant to the Reform Act, we will become subject to new minimum capital requirements.  In July 2013, the Agencies issued rules that will subject many savings and loan holding companies, including Astoria Financial Corporation, to consolidated capital requirements. The rules also revise the quantity and quality of required minimum risk-based and leverage capital requirements applicable to Astoria Federal and Astoria Financial Corporation, consistent with the Reform Act and the Basel III capital standards, add a new common equity Tier 1 risk-based capital ratio and add an additional common equity Tier 1 capital conservation buffer, or Conservation Buffer, of 2.50% of risk-weighted assets, to be applied to the new common equity Tier 1 risk-based capital ratio, the Tier 1 risk-based capital ratio and the total risk-based capital ratio.  The rules impose restrictions on capital distributions and certain discretionary cash bonus payments if the minimum Conservation Buffer is not met. The rules also revise the calculation of risk-weighted assets to enhance their risk sensitivity and phase out trust preferred securities and cumulative perpetual preferred stock as Tier 1 capital. The new minimum regulatory capital ratios and changes to the calculation of risk-weighted assets will be phased in to allow banking organizations to meet the new capital standards, with the initial provisions effective for Astoria Financial Corporation and Astoria Federal on January 1, 2015.  We are continuing to review and prepare for the impact that the Reform Act, Basel III capital standards and related rulemaking will have on our business, financial condition and results of operations.  For additional information, see Part II, Item 1A, “Risk Factors,” in our June 30, 2013 Quarterly Report on Form 10-Q.

Off-Balance Sheet Arrangements and Contractual Obligations

We are a party to financial instruments with off-balance sheet risk in the normal course of our business in order to meet the financing needs of our customers and in connection with our overall interest rate risk management strategy.  These instruments involve, to varying degrees, elements of credit, interest rate and liquidity risk.  In accordance with GAAP, these instruments are either not recorded in the consolidated financial statements or are recorded in amounts that differ from the notional amounts.  Such instruments primarily include lending commitments and lease commitments.

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Lending commitments include commitments to originate and purchase loans and commitments to fund unused lines of credit.  Additionally, in connection with our mortgage banking activities, we have commitments to fund loans held-for-sale and commitments to sell loans which are considered financial derivative instruments.  Commitments to sell loans totaled $27.4 million at September 30, 2013.  The fair values of our mortgage banking derivative instruments are immaterial to our financial condition and results of operations.  We also have contractual obligations related to operating lease commitments which have not changed significantly from December 31, 2012.

The following table details our contractual obligations at September 30, 2013.

	Payments due by period
(In Thousands)	Total	Less than One Year	One to Three Years	Three to Five Years	More than Five Years
On-balance sheet contractual obligations:
Borrowings with original terms greater than three months	$ 3,300,000	$  250,000	$ 850,000	$ 1,050,000	$ 1,150,000
Off-balance sheet contractual obligations:
Commitments to originate and purchase loans (1)	397,794	397,794	—	—	—
Commitments to fund unused lines of credit (2)	180,153	180,153	—	—	—
Total	$ 3,877,947	$  827,947	$ 850,000	$ 1,050,000	$ 1,150,000

(1)Includes commitments to originate loans held-for-sale of $13.7 million.

(2)Includes commitments to fund unused home equity lines of credit of $112.4 million.

In addition to the contractual obligations previously discussed, we have liabilities for gross unrecognized tax benefits and interest and penalties related to uncertain tax positions which have not changed significantly from December 31, 2012.  For further information regarding these liabilities, see Note 11 of Notes to Consolidated Financial Statements in Part II, Item 8, “Financial Statements and Supplementary Data,” in our 2012 Annual Report on Form 10-K.  We also have contingent liabilities related to assets sold with recourse and standby letters of credit which have not changed significantly from December 31, 2012.

For further information regarding our off-balance sheet arrangements and contractual obligations, see Part II, Item 7, “MD&A,” in our 2012 Annual Report on Form 10-K.

Comparison of Financial Condition as of September 30, 2013 and December 31, 2012 and Operating Results for the Three and Nine Months Ended September 30, 2013 and 2012

Financial Condition

Total assets declined $474.6 million to $16.02 billion at September 30, 2013, from $16.50 billion at December 31, 2012, primarily reflecting a decrease in our residential mortgage loan portfolio which was partially offset by increases in our multi-family and commercial real estate mortgage loan portfolio and our securities portfolio.

Loans receivable, net, decreased $679.9 million to $12.40 billion at September 30, 2013, from $13.08 billion at December 31, 2012, and represented 77% of total assets at September 30, 2013. The growth in our multi-family and commercial real estate mortgage loan portfolio was more than offset by the decline in our residential mortgage loan portfolio resulting in a net decline of $652.5 million in our total mortgage loan portfolio to $12.24 billion at September 30, 2013, compared to $12.89 billion at December 31, 2012.  While our mortgage loan portfolio continues

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to consist primarily of residential mortgage loans, at September 30, 2013 our combined multi-family and commercial real estate mortgage loan portfolio represented 32% of our total loan portfolio, up from 24% at December 31, 2012.  This reflects our continued focus on repositioning the asset mix of our balance sheet.  Gross mortgage loans originated and purchased for portfolio during the nine months ended September 30, 2013 declined to $2.07 billion, compared to $3.52 billion during the nine months ended September 30, 2012, due to a decline in residential mortgage loan originations and purchases.  Mortgage loan repayments decreased to $2.65 billion for the nine months ended September 30, 2013, compared to $3.14 billion for the nine months ended September 30, 2012.  The decreases in mortgage loan repayments for the nine months ended September 30, 2013, compared to the nine months ended September 30, 2012, was primarily due to a decline in residential mortgage loan prepayments, as well as a decline in multi-family and commercial real estate mortgage loan prepayments.

Our residential mortgage loan portfolio decreased $1.41 billion to $8.30 billion at September 30, 2013, from $9.71 billion at December 31, 2012, and represented 66% of our total loan portfolio at September 30, 2013.  Residential mortgage loan originations and purchases for portfolio totaled $837.8 million for the nine months ended September 30, 2013, of which $492.7 million were originations and $345.1 million were purchases, compared to $2.30 billion for the nine months ended September 30, 2012, of which $1.45 billion were originations and $841.0 million were purchases.  Residential mortgage loan repayments declined for the nine months ended September 30, 2013, compared to the nine months ended September 30, 2012, but remain at elevated levels and outpaced our origination and purchase volume during the nine months ended September 30, 2013, resulting in the decline in the portfolio.  During the nine months ended September 30, 2013, the loan-to-value ratio of our residential mortgage loan originations and purchases for portfolio, at the time of origination or purchase, averaged approximately 65% and the loan amount averaged approximately $720,000.

Our multi-family mortgage loan portfolio increased $711.3 million to $3.12 billion at September 30, 2013, from $2.41 billion at December 31, 2012, and represented 25% of our total loan portfolio at September 30, 2013.  Our commercial real estate mortgage loan portfolio increased $48.9 million to $822.8 million at September 30, 2013, from $773.9 million at December 31, 2012, and represented 7% of our total loan portfolio at September 30, 2013.  Multi-family and commercial real estate loan originations totaled $1.23 billion during the nine months ended September 30, 2013, unchanged compared to originations during the nine months ended September 30, 2012, reflecting continued strong loan production as we concentrate on growing these portfolios.  During the nine months ended September 30, 2013, our multi-family and commercial real estate mortgage loan originations reflected loan balances averaging approximately $2.6 million with a weighted average loan-to-value ratio, at the time of origination, of approximately 46% and a weighted average debt service coverage ratio of approximately 1.76%.

Our securities portfolio increased $294.8 million to $2.33 billion, or 15% of total assets, at September 30, 2013, compared to $2.04 billion at December 31, 2012.  This increase reflects purchases totaling $1.05 billion which were in excess of repayments of $688.6 million and sales of $39.6 million during the nine months ended September 30, 2013.  At September 30, 2013, our securities portfolio was comprised primarily of fixed rate REMIC and CMO securities which had an amortized cost of $1.84 billion, a weighted average current coupon of 3.01%, a weighted average collateral coupon of 4.43% and a weighted average life of 3.9 years.

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Deposits decreased $383.6 million to $10.06 billion at September 30, 2013, from $10.44 billion at December 31, 2012, due to a decrease of $509.6 million in certificates of deposit to $3.45 billion at September 30, 2013, partially offset by a net increase of $126.0 million in core deposits.  At September 30, 2013, core deposits totaled $6.61 billion and represented 66% of total deposits, up from 62% of total deposits at December 31, 2012.  This reflects our efforts to reposition the liability mix of our balance sheet, reducing borrowings and certificates of deposit and increasing core deposits.  Money market accounts increased $327.1 million since December 31, 2012 to $1.91 billion at September 30, 2013.  NOW and demand deposit accounts increased $38.3 million since December 31, 2012 to $2.13 billion at September 30, 2013.  Savings accounts decreased $239.4 million since December 31, 2012 to $2.56 billion at September 30, 2013.  The net increase in core deposits during the nine months ended September 30, 2013 appear to reflect customer preference for the liquidity these types of deposits provide, as well as our efforts to expand our business banking customer base.  At September 30, 2013, total deposits included $689.6 million of business deposits, substantially all of which were core deposits, an increase of 41% since December 31, 2012.

Total borrowings, net, decreased $264.5 million to $4.11 billion at September 30, 2013, from $4.37 billion at December 31, 2012.  The decrease in borrowings was primarily due to a decrease of $421.0 million in FHLB-NY advances and the prepayment of our Junior Subordinated Debentures, partially offset by our use of short-term federal funds purchased in 2013 which totaled $285.0 million at September 30, 2013.  For further information on the prepayment of our Junior Subordinated Debentures, see “Liquidity and Capital Resources.”

Stockholders’ equity increased $163.9 million to $1.46 billion at September 30, 2013, from $1.29 billion at December 31, 2012.  The increase in stockholders’ equity was primarily due to the net proceeds of $129.8 million from the issuance of the Series C Preferred Stock in the 2013 first quarter, net income of $46.4 million and stock-based compensation and the allocation of employee stock ownership plan, or ESOP, stock totaling $13.1 million, partially offset by dividends on common and preferred stock of $16.8 million and other comprehensive loss of $7.4 million.  For further information on the issuance of the Series C Preferred Stock, see “Liquidity and Capital Resources.”

Results of Operations

General

Net income available to common shareholders for the three months ended September 30, 2013 increased $1.3 million to $14.7 million, compared to $13.4 million for the three months ended September 30, 2012, reflecting an increase of $3.5 million in net income to $16.9 million for the three months ended September 30, 2013, compared to $13.4 million for the three months ended September 30, 2012, partially offset by preferred stock dividends declared in the 2013 third quarter totaling $2.2 million.  Diluted EPS was $0.15 per share for the three months ended September 30, 2013, compared to $0.14 per share for the three months ended September 30, 2012.  The increase in net income for the three months ended September 30, 2013, compared to the three months ended September 30, 2012, primarily reflects a lower provision for loan losses, partially offset by a reduction in non-interest income.

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For the nine months ended September 30, 2013, net income available to common shareholders increased $5.2 million to $41.4 million, compared to $36.2 million for the nine months ended September 30, 2012.  This increase reflects an increase of $10.2 million in net income to $46.4 million for the nine months ended September 30, 2013, compared to $36.2 million for the nine months ended September 30, 2012, partially offset by preferred stock dividends declared during the nine months ended September 30, 2013 totaling $5.0 million.  Diluted EPS increased to $0.42 per share for the nine months ended September 30, 2013, compared to $0.38 per share for the nine months ended September 30, 2012.  The increase in net income for the nine months ended September 30, 2013, compared to the nine months ended September 30, 2012, was primarily attributable to a decline in the provision for loan losses and a reduction in non-interest expense, partially offset by lower net interest income.

Return on average assets increased to 0.42% for the three months ended September 30, 2013, compared to 0.31% for the three months ended September 30, 2012, and increased to 0.38% for the nine months ended September 30, 2013, compared to 0.28% for the nine months ended September 30, 2012.  The increases in the returns on average assets for the three and nine months ended September 30, 2013 compared to the three and nine months ended September 30, 2012 were due to the increases in net income, coupled with declines in average assets.

Return on average common stockholders’ equity increased to 4.47% for the three months ended September 30, 2013, compared to 4.14% for the three months ended September 30, 2012, and increased to 4.22% for the nine months ended September 30, 2013, compared to 3.79% for the nine months ended September 30, 2012.   Return on average tangible common stockholders’ equity, which represents average common stockholders’ equity less average goodwill, increased to 5.20% for the three months ended September 30, 2013, compared to 4.84% for the three months ended September 30, 2012, and increased to 4.91% for the nine months ended September 30, 2013, compared to 4.44% for the nine months ended September 30, 2012.  The increases in these returns for the three and nine months ended September 30, 2013, compared to the three and nine months ended September 30, 2012, were due to the increases in net income available to common shareholders, partially offset by increases in average common stockholders’ equity.

Net Interest Income

Net interest income represents the difference between income on interest-earning assets and expense on interest-bearing liabilities.  Net interest income depends primarily upon the volume of interest-earning assets and interest-bearing liabilities and the corresponding interest rates earned or paid. Our net interest income is significantly impacted by changes in interest rates and market yield curves and their related impact on cash flows.  See Item 3, “Quantitative and Qualitative Disclosures About Market Risk,” for further discussion of the potential impact of changes in interest rates on our results of operations.

Net interest income increased slightly to $86.2 million for the three months ended September 30, 2013, from $86.0 million for the three months ended September 30, 2012, due to a slightly greater reduction in interest expense than the decline in interest income.  For the nine months ended September 30, 2013, a decline in interest income exceeded a decline in interest expense resulting in a decrease of $5.8 million in net interest income to $255.1 million, compared to $260.9 million for the nine months ended September 30, 2012.  The continued low interest rate environment, coupled with the restructuring of $1.35 billion of borrowings in the 2013 second

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and third quarters and the prepayment of our Junior Subordinated Debentures in the 2013 second quarter, has resulted in the average cost of interest-bearing liabilities declining more than the average yield on interest-earning assets and an improvement in our net interest rate spread for the three and nine months ended September 30, 2013 compared to the three and nine months ended September 30, 2012.  The restructuring of borrowings in 2013 resulted in a 94 basis point decline in the weighted average rate on such borrowings.  For the 2013 third quarter, the decline in the average cost of interest-bearing liabilities more than offset the impact of the decline in the average balance of interest-earning assets, resulting in the slight improvement in net interest income compared to the 2012 third quarter.  This improvement in the 2013 third quarter had the impact of lessening the decline in net interest income for the nine months ended September 30, 2013 compared to the nine months ended September 30, 2012.

The net interest rate spread increased eighteen basis points to 2.20% for the three months ended September 30, 2013, from 2.02% for the three months ended September 30, 2012, and increased eight basis points to 2.16% for the nine months ended September 30, 2013, from 2.08% for the nine months ended September 30, 2012.  The net interest margin increased nineteen basis points to 2.28% for the three months ended September 30, 2013, from 2.09% for the three months ended September 30, 2012, and increased eight basis points to 2.23% for the nine months ended September 30, 2013, from 2.15% for the nine months ended September 30, 2012.  The average balance of net interest-earning assets increased $222.2 million to $934.3 million for the three months ended September 30, 2013, from $712.1 million for the three months ended September 30, 2012, and increased $199.0 million to $884.1 million for the nine months ended September 30, 2013, from $685.1 million for the nine months ended September 30, 2012.

The changes in average interest-earning assets and interest-bearing liabilities and their related yields and costs are discussed in greater detail under “Interest Income” and “Interest Expense.”

Analysis of Net Interest Income

The following tables set forth certain information about the average balances of our assets and liabilities and their related yields and costs for the periods indicated.  Average yields are derived by dividing income by the average balance of the related assets and average costs are derived by dividing expense by the average balance of the related liabilities, for the periods shown.  Average balances are derived from average daily balances.  The yields and costs include amortization of fees, costs, premiums and discounts which are considered adjustments to interest rates.

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	For the Three Months Ended September 30,
	2013							2012
(Dollars in Thousands)	Average Balance			Interest		Average Yield/ Cost		Average Balance			Interest		Average Yield/ Cost
						(Annualized)							(Annualized)
Assets:
Interest-earning assets:
Mortgage loans (1):
Residential	$	8,499,231		$	69,158	3.25	%	$	10,495,563		$	91,490	3.49	%
Multi-family and commercial real estate	3,829,065			41,450		4.33		2,908,993			38,127		5.24
Consumer and other loans (1)	248,529			2,175		3.50		271,309			2,309		3.40
Total loans	12,576,825			112,783		3.59		13,675,865			131,926		3.86
Mortgage-backed and other securities (2)	2,320,896			13,247		2.28		2,290,702			14,453		2.52
Repurchase agreements and interest- earning cash accounts	87,258			67		0.31		277,319			182		0.26
FHLB-NY stock	150,504			1,498		3.98		181,792			1,773		3.90
Total interest-earning assets	15,135,483			127,595		3.37		16,425,678			148,334		3.61
Goodwill	185,151							185,151
Other non-interest-earning assets	738,821							806,010
Total assets	$	16,059,455						$	17,416,839
Liabilities and stockholders’ equity:
Interest-bearing liabilities:
Savings	$	2,619,798		330		0.05		$	2,843,856		710		0.10
Money market	1,864,235			1,179		0.25		1,406,949			2,234		0.64
NOW and demand deposit	2,103,436			172		0.03		1,943,448			228		0.05
Total core deposits	6,587,469			1,681		0.10		6,194,253			3,172		0.20
Certificates of deposit	3,513,212			13,475		1.53		4,428,338			18,947		1.71
Total deposits	10,100,681			15,156		0.60		10,622,591			22,119		0.83
Borrowings	4,100,528			26,235		2.56		5,090,960			40,217		3.16
Total interest-bearing liabilities	14,201,209			41,391		1.17		15,713,551			62,336		1.59
Non-interest-bearing liabilities	409,510							413,756
Total liabilities	14,610,719							16,127,307
Stockholders’ equity	1,448,736							1,289,532
Total liabilities and stockholders’ equity	$	16,059,455						$	17,416,839
Net interest income/ net interest rate spread (3)				$	86,204	2.20	%				$	85,998	2.02	%
Net interest-earning assets/ net interest margin (4)	$	934,274				2.28	%	$	712,127				2.09	%
Ratio of interest-earning assets to interest-bearing liabilities	1.07		x					1.05		x

(1)Mortgage loans and consumer and other loans include loans held-for-sale and non-performing loans and exclude the allowance for loan losses.

(2)Securities available-for-sale are included at average amortized cost.

(3)Net interest rate spread represents the difference between the average yield on average interest-earning assets and the average cost of average interest-bearing liabilities.

(4)Net interest margin represents net interest income divided by average interest-earning assets.

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	For the Nine Months Ended September 30,
	2013							2012
(Dollars in Thousands)	Average Balance			Interest		Average Yield/ Cost		Average Balance			Interest		Average Yield/ Cost
						(Annualized)							(Annualized)
Assets:
Interest-earning assets:
Mortgage loans (1):
Residential	$	9,007,869		$	222,994	3.30	%	$	10,589,227		$	286,236	3.60	%
Multi-family and commercial real estate	3,558,759			120,463		4.51		2,631,859			111,088		5.63
Consumer and other loans (1)	256,866			6,611		3.43		275,854			6,944		3.36
Total loans	12,823,494			350,068		3.64		13,496,940			404,268		3.99
Mortgage-backed and other securities (2)	2,190,480			36,003		2.19		2,381,407			49,445		2.77
Repurchase agreements and interest-earning cash accounts	93,327			192		0.27		160,272			282		0.23
FHLB-NY stock	154,942			5,147		4.43		159,774			4,928		4.11
Total interest-earning assets	15,262,243			391,410		3.42		16,198,393			458,923		3.78
Goodwill	185,151							185,151
Other non-interest-earning assets	767,235							843,811
Total assets	$	16,214,629						$	17,227,355
Liabilities and stockholders’ equity:
Interest-bearing liabilities:
Savings	$	2,705,411		1,011		0.05		$	2,825,012		4,084		0.19
Money market	1,786,764			4,409		0.33		1,259,063			6,242		0.66
NOW and demand deposit	2,095,285			518		0.03		1,907,300			814		0.06
Total core deposits	6,587,460			5,938		0.12		5,991,375			11,140		0.25
Certificates of deposit	3,677,032			42,228		1.53		4,896,215			67,339		1.83
Total deposits	10,264,492			48,166		0.63		10,887,590			78,479		0.96
Borrowings	4,113,661			88,107		2.86		4,625,679			119,581		3.45
Total interest-bearing liabilities	14,378,153			136,273		1.26		15,513,269			198,060		1.70
Non-interest-bearing liabilities	436,554							442,512
Total liabilities	14,814,707							15,955,781
Stockholders’ equity	1,399,922							1,271,574
Total liabilities and stockholders’ equity	$	16,214,629						$	17,227,355
Net interest income/ net interest rate spread (3)				$	255,137	2.16	%				$	260,863	2.08	%
Net interest-earning assets/ net interest margin (4)	$	884,090				2.23	%	$	685,124				2.15	%
Ratio of interest-earning assets to interest-bearing liabilities	1.06		x					1.04		x

(1)Mortgage loans and consumer and other loans include loans held-for-sale and non-performing loans and exclude the allowance for loan losses.

(2)Securities available-for-sale are included at average amortized cost.

(3)Net interest rate spread represents the difference between the average yield on average interest-earning assets and the average cost of average interest-bearing liabilities.

(4)Net interest margin represents net interest income divided by average interest-earning assets.

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Rate/Volume Analysis

The following table presents the extent to which changes in interest rates and changes in the volume of interest-earning assets and interest-bearing liabilities have affected our interest income and interest expense during the periods indicated.  Information is provided in each category with respect to (1) the changes attributable to changes in volume (changes in volume multiplied by prior rate), (2) the changes attributable to changes in rate (changes in rate multiplied by prior volume), and (3) the net change.  The changes attributable to the combined impact of volume and rate have been allocated proportionately to the changes due to volume and the changes due to rate.

	Increase (Decrease) for the Three Months Ended September 30, 2013 Compared to the Three Months Ended September 30, 2012									Increase (Decrease) for the Nine Months Ended September 30, 2013 Compared to the Nine Months Ended September 30, 2012
(In Thousands)	Volume			Rate			Net			Volume			Rate			Net
Interest-earning assets:
Mortgage loans:
Residential	$	(16,402	)	$	(5,930	)	$	(22,332	)	$	(40,591	)	$	(22,651	)	$	(63,242	)
Multi-family and commercial real estate	10,690			(7,367		)	3,323			34,246			(24,871		)	9,375
Consumer and other loans	(200		)	66			(134		)	(478		)	145			(333		)
Mortgage-backed and other securities	187			(1,393		)	(1,206		)	(3,722		)	(9,720		)	(13,442		)
Repurchase agreements and interest-earning cash accounts	(144		)	29			(115		)	(131		)	41			(90		)
FHLB-NY stock	(310		)	35			(275		)	(153		)	372			219
Total	(6,179		)	(14,560		)	(20,739		)	(10,829		)	(56,684		)	(67,513		)
Interest-bearing liabilities:
Savings	(52		)	(328		)	(380		)	(167		)	(2,906		)	(3,073		)
Money market	588			(1,643		)	(1,055		)	2,006			(3,839		)	(1,833		)
NOW and demand deposit	24			(80		)	(56		)	93			(389		)	(296		)
Certificates of deposit	(3,625		)	(1,847		)	(5,472		)	(15,142		)	(9,969		)	(25,111		)
Borrowings	(7,076		)	(6,906		)	(13,982		)	(12,367		)	(19,107		)	(31,474		)
Total	(10,141		)	(10,804		)	(20,945		)	(25,577		)	(36,210		)	(61,787		)
Net change in net interest income	$	3,962		$	(3,756	)	$	206		$	14,748		$	(20,474	)	$	(5,726	)

Interest Income

Interest income decreased $20.7 million to $127.6 million for the three months ended September 30, 2013, from $148.3 million for the three months ended September 30, 2012, due to a decrease in the average yield on interest-earning assets to 3.37% for the three months ended September 30, 2013, from 3.61% for the three months ended September 30, 2012, coupled with a decrease of $1.29 billion in the average balance of interest-earning assets to $15.14 billion for the three months ended September 30, 2013, from $16.43 billion for the three months ended September 30, 2012.  The decrease in the average yield on interest-earning assets was primarily due to lower average yields on mortgage loans and mortgage-backed and other securities.  The decrease in the average balance of interest-earning assets was primarily due to decreases in the average balances of residential mortgage loans and repurchase agreements and interest-earning cash accounts, partially offset by an increase in the average balance of multi-family and commercial real estate mortgage loans.

Interest income on residential mortgage loans decreased $22.3 million to $69.2 million for the three months ended September 30, 2013, from $91.5 million for the three months ended September 30, 2012, due to a decrease of $2.00 billion in the average balance of such loans, coupled with a decrease in the average yield to 3.25% for the three months ended September 30,

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2013, from 3.49% for the three months ended September 30, 2012.  The decrease in the average balance of residential mortgage loans reflects the continued elevated levels of repayments on such loans which have outpaced our originations and purchases over the past year.  The decrease in the average yield on residential mortgage loans was primarily due to new originations and purchases at lower interest rates than the rates on loans repaid over the past year and the impact of the downward repricing of our ARM loans, partially offset by a decline in amortization of net premium and deferred loan origination cost.  While remaining elevated, the levels of prepayments on residential mortgage loans declined during the 2013 third quarter compared to the 2012 third quarter and contributed to a decrease of $1.0 million in net premium and deferred loan origination cost amortization to $5.0 million for the three months ended September 30, 2013, from $6.0 million for the three months ended September 30, 2012.

Interest income on multi-family and commercial real estate mortgage loans increased $3.4 million to $41.5 million for the three months ended September 30, 2013, from $38.1 million for the three months ended September 30, 2012, due to an increase of $920.1 million in the average balance of such loans, partially offset by a decrease in the average yield to 4.33% for the three months ended September 30, 2013, from 5.24% for the three months ended September 30, 2012.  The increase in the average balance of multi-family and commercial real estate loans was attributable to strong levels of originations of such loans which have exceeded repayments over the past year.  The decrease in the average yield on multi-family and commercial real estate loans was primarily due to new originations at interest rates below the weighted average rates of the portfolios, reflecting both the lower interest rate environment and the impact of competitive pricing in our markets, coupled with a decline in prepayment penalties.  Prepayment penalties decreased $269,000 to $1.5 million for the three months ended September 30, 2013, from $1.8 million for the three months ended September 30, 2012.

Interest income on mortgage-backed and other securities decreased $1.3 million to $13.2 million for the three months ended September 30, 2013, from $14.5 million for the three months ended September 30, 2012, primarily due to a decrease in the average yield to 2.28% for the three months ended September 30, 2013, from 2.52% for the three months ended September 30, 2012.  The decrease in the average yield on mortgage-backed and other securities was primarily due to repayments on higher yielding securities and purchases of new securities with lower coupons than the weighted average coupon for the portfolio, partially offset by a decline in net premium amortization.  Net premium amortization on mortgage-backed and other securities decreased $1.2 million to $3.3 million for the three months ended September 30, 2013, from $4.5 million for the three months ended September 30, 2012.  The average balance of mortgage-backed and other securities increased slightly for the three months ended September 30, 2013, compared to the three months ended September 30, 2012.  The decrease in the net premium amortization and the increase in the average balance of mortgage-backed and other securities for the three months ended September 30, 2013, compared to the three months ended September 30, 2012, reflects a slowdown of repayment activity experienced in the 2013 third quarter due to increases in longer term interest rates beginning in the latter part of the 2013 second quarter and continuing into the 2013 third quarter.

Interest income decreased $67.5 million to $391.4 million for the nine months ended September 30, 2013, from $458.9 million for the nine months ended September 30, 2012, due to a decrease in the average yield on interest-earning assets to 3.42% for the nine months ended September 30, 2013, from 3.78% for the nine months ended September 30, 2012, coupled with a decrease of

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$936.2 million in the average balance of interest-earning assets to $15.26 billion for the nine months ended September 30, 2013, from $16.20 billion for the nine months ended September 30, 2012.  The decrease in the average balance of interest-earning assets was primarily due to decreases in the average balances of residential mortgage loans and mortgage-backed and other securities, partially offset by an increase in the average balance of multi-family and commercial real estate mortgage loans.

Interest income on residential mortgage loans decreased $63.2 million to $223.0 million for the nine months ended September 30, 2013, from $286.2 million for the nine months ended September 30, 2012, due to a decrease of $1.58 billion in the average balance of such loans, coupled with a decrease in the average yield to 3.30% for the nine months ended September 30, 2013, from 3.60% for the nine months ended September 30, 2012.  Net premium and deferred loan origination cost amortization on residential mortgage loans decreased $2.3 million to $16.2 million for the nine months ended September 30, 2013, from $18.5 million for the nine months ended September 30, 2012.

Interest income on multi-family and commercial real estate loans increased $9.4 million to $120.5 million for the nine months ended September 30, 2013, from $111.1 million for the nine months ended September 30, 2012, due to an increase of $926.9 million in the average balance of such loans, partially offset by a decrease in the average yield to 4.51% for the nine months ended September 30, 2013, from 5.63% for the nine months ended September 30, 2012.  Prepayment penalties decreased $1.7 million to $4.8 million for the nine months ended September 30, 2013, from $6.5 million for the nine months ended September 30, 2012.

Interest income on mortgage-backed and other securities decreased $13.4 million to $36.0 million for the nine months ended September 30, 2013, from $49.4 million for the nine months ended September 30, 2012.  This decrease was due to a decrease in the average yield to 2.19% for the nine months ended September 30, 2013, from 2.77% for the nine months ended September 30, 2012, coupled with a decrease of $190.9 million in the average balance of the portfolio.  Net premium amortization on mortgage-backed and other securities increased $1.5 million to $12.7 million for the nine months ended September 30, 2013, from $11.2 million for the nine months ended September 30, 2012, contributing to the decline in the average yield on mortgage-backed and other securities for the nine months ended September 30, 2013, compared to the nine months ended September 30, 2012.  The increase in net premium amortization primarily reflects the greater proportion of securities within our portfolio during 2013, compared to 2012, which were purchased at a premium.  Although securities purchases have kept pace with the levels of securities repayments and sales over the past twelve months, during 2012 our securities repayments and sales were in excess of purchases resulting in a declining portfolio balance throughout 2012, which resulted in a lower average balance of the securities portfolio for 2013.

Except as otherwise noted, the principal reasons for the changes in the average yields and average balances of the various assets noted above for the nine months ended September 30, 2013 are consistent with the principal reasons for the changes noted for the three months ended September 30, 2013.

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Interest Expense

Interest expense decreased $20.9 million to $41.4 million for the three months ended September 30, 2013, from $62.3 million for the three months ended September 30, 2012, due to decreases in both the average cost and average balance of interest-bearing liabilities.  The average cost of interest-bearing liabilities decreased to 1.17% for the three months ended September 30, 2013, from 1.59% for the three months ended September 30, 2012, primarily due to a decrease in the average cost of borrowings, although the average costs of all deposit liability categories also declined.  The average balance of interest-bearing liabilities decreased $1.51 billion to $14.20 billion for the three months ended September 30, 2013, from $15.71 billion for the three months ended September 30, 2012, reflecting decreases in the average balances of borrowings and certificates of deposit, partially offset by an increase in the average balance of core deposits.

Interest expense on total deposits decreased $6.9 million to $15.2 million for the three months ended September 30, 2013, from $22.1 million for the three months ended September 30, 2012, due to a decrease in the average cost to 0.60% for the three months ended September 30, 2013, from 0.83% for the three months ended September 30, 2012, coupled with a decrease of $521.9 million in the average balance of total deposits to $10.10 billion for the three months ended September 30, 2013, from $10.62 billion for the three months ended September 30, 2012.  The decrease in the average cost of total deposits reflects decreases in the average costs of all deposit liability categories.  The decrease in the average balance of total deposits was due to a decrease in the average balance of certificates of deposit, partially offset by a net increase in the average balance of core deposits.

Interest expense on core deposits decreased $1.5 million to $1.7 million for the three months ended September 30, 2013, from $3.2 million for the three months ended September 30, 2012, due to a decrease in the average cost to 0.10% for the three months ended September 30, 2013, from 0.20% for the three months ended September 30, 2012, partially offset by an increase of $393.2 million in the average balance of such deposits.  The decrease in the average cost and increase in the average balance of core deposits was primarily due to money market accounts.  Interest expense on money market accounts decreased $1.1 million for the three months ended September 30, 2013 compared to the three months ended September 30, 2012 due to a decrease in the average cost to 0.25% for the three months ended September 30, 2013, compared to 0.64% for the three months ended September 30, 2012, partially offset by an increase of $457.3 million in the average balance.

Interest expense on certificates of deposit decreased $5.4 million to $13.5 million for the three months ended September 30, 2013, from $18.9 million for the three months ended September 30, 2012, due to a decrease of $915.1 million in the average balance, coupled with a decrease in the average cost to 1.53% for the three months ended September 30, 2013, from 1.71% for the three months ended September 30, 2012.  The decrease in the average balance of certificates of deposit was primarily the result of our reduced focus on certificates of deposits reflecting our efforts to reposition the liability mix of our balance sheet to increase our core deposits and reduce certificates of deposit.  The decrease in the average cost of certificates of deposit reflects the impact of certificates of deposit at higher rates maturing and being replaced at lower interest rates.  During the three months ended September 30, 2013, $453.6 million of certificates of deposit, with a weighted average rate of 0.67% and a weighted average maturity at inception of fifteen months, matured and $303.8 million of certificates of deposit were issued or repriced,

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with a weighted average rate of 0.09% and a weighted average maturity at inception of seven months.

Interest expense on borrowings decreased $14.0 million to $26.2 million for the three months ended September 30, 2013, from $40.2 million for the three months ended September 30, 2012, due to declines in both the average balance and average cost of borrowings.  The average balance of borrowings decreased $990.4 million to $4.10 billion for the three months ended September 30, 2013, from $5.09 billion for the three months ended September 30, 2012.  The decline in the average balance of borrowings primarily reflects the reduction in total average assets, coupled with the prepayment of our Junior Subordinated Debentures in the 2013 second quarter.  The average cost of borrowings decreased to 2.56% for the three months ended September 30, 2013, from 3.16% for the three months ended September 30, 2012.  The decline in the average cost of borrowings is due in large part to the restructuring of $1.35 billion of borrowings in the 2013 second and third quarters, which resulted in a reduction of the weighted average rate on such borrowings from 4.40% to 3.46%, and the prepayment of our Junior Subordinated Debentures.  The decline in the average balance and average cost of borrowings for the three months ended September 30, 2013, compared to the three months ended September 30, 2012, also reflects the prepayment in September 2012 of our previously outstanding 5.75% senior unsecured notes with the proceeds from the issuance in June 2012 of our 5.00% senior unsecured notes.

Interest expense decreased $61.8 million to $136.3 million for the nine months ended September 30, 2013, from $198.1 million for the nine months ended September 30, 2012, due to a decrease in the average cost of interest-bearing liabilities to 1.26% for the nine months ended September 30, 2013, from 1.70% for the nine months ended September 30, 2012, coupled with a decrease of $1.13 billion in the average balance of interest-bearing liabilities to $14.38 billion for the nine months ended September 30, 2013, from $15.51 billion for the nine months ended September 30, 2012.

Interest expense on total deposits decreased $30.3 million to $48.2 million for the nine months ended September 30, 2013, from $78.5 million for the nine months ended September 30, 2012, due to a decrease in the average cost to 0.63% for the nine months ended September 30, 2013, from 0.96% for the nine months ended September 30, 2012, coupled with a decrease of $623.1 million in the average balance of total deposits to $10.26 billion for the nine months ended September 30, 2013, from $10.89 billion for the nine months ended September 30, 2012.

Interest expense on core deposits decreased $5.2 million to $5.9 million for the nine months ended September 30, 2013, from $11.1 million for the nine months ended September 30, 2012, due to a decrease in the average cost to 0.12% for the nine months ended September 30, 2013, from 0.25% for the nine months ended September 30, 2012, partially offset by an increase of $596.1 million in the average balance of such deposits.  The decrease in the average cost of core deposits was primarily due to declines in the average costs of money market and savings accounts.  The increase in the average balance of core deposits was due to increases in the average balances of money market and NOW and demand deposit accounts, partially offset by a decline in the average balance of savings accounts.  Interest expense on savings accounts decreased $3.1 million for the nine months ended September 30, 2013 compared to the nine months ended September 30, 2012 primarily due to a decrease in the average cost to 0.05% for the nine months ended September 30, 2013, compared to 0.19% for the nine months ended September 30, 2012.  Interest expense on money market accounts decreased $1.8 million for the

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nine months ended September 30, 2013 compared to the nine months ended September 30, 2012 due to a decrease in the average cost to 0.33% for the nine months ended September 30, 2013, compared to 0.66% for the nine months ended September 30, 2012, partially offset by an increase of $527.7 million in the average balance of such accounts.

Interest expense on certificates of deposit decreased $25.1 million to $42.2 million for the nine months ended September 30, 2013, from $67.3 million for the nine months ended September 30, 2012, due to a decrease of $1.22 billion in the average balance, coupled with a decrease in the average cost to 1.53% for the nine months ended September 30, 2013, from 1.83% for the nine months ended September 30, 2012.  During the nine months ended September 30, 2013, $1.68 billion of certificates of deposit matured, with a weighted average rate of 0.58% and a weighted average maturity at inception of fourteen months, and $1.13 billion of certificates of deposit were issued or repriced, with a weighted average rate of 0.10% and a weighted average maturity at inception of eight months.

Interest expense on borrowings decreased $31.5 million to $88.1 million for the nine months ended September 30, 2013, from $119.6 million for the nine months ended September 30, 2012, due to a decrease in the average cost to 2.86% for the nine months ended September 30, 2013, from 3.45% for the nine months ended September 30, 2012, coupled with a decrease of $512.0 million in the average balance of borrowings to $4.11 billion for the nine months ended September 30, 2013, from $4.63 billion for the nine months ended September 30, 2012.

Except as otherwise noted, the principal reasons for the changes in the average costs and average balances of the various liabilities noted above for the nine months ended September 30, 2013 are consistent with the principal reasons for the changes noted for the three months ended September 30, 2013.

Provision for Loan Losses

We review our allowance for loan losses on a quarterly basis.  Material factors considered during our quarterly review are the composition and size of our loan portfolio, the levels and composition of loan delinquencies and non-performing loans, our loss history and our evaluation of the housing and real estate markets and the current economic environment.  We continue to closely monitor the local and national real estate markets and other factors related to risks inherent in our loan portfolio.  We are impacted by both national and regional economic factors with residential mortgage loans from various regions of the country held in our portfolio and our multi-family and commercial real estate mortgage loan portfolio concentrated in the New York metropolitan area, which includes New York, New Jersey and Connecticut.  Although the U.S. economy has shown signs of modest improvement, the operating environment continues to remain challenging.  Interest rates have been at or near historic lows and we expect them to remain low for the near term.  However, long-term rates moved higher during the latter part of the 2013 second quarter and into the 2013 third quarter, with the ten year U.S. Treasury rate increasing from 1.63% at May 1, 2013 to 2.49% at the end of June and 2.61% at the end of September.  The national unemployment rate, while remaining high, declined to 7.2% for September 2013, compared to a peak of 10.0% for October 2009 and new job growth, while remaining slow, has continued in 2013.  Softness persists in the housing and real estate markets, although the extent of such softness varies from region to region.  However, we believe market

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conditions remain favorable in the New York metropolitan area with respect to our multi-family mortgage loan origination activities.

The provision for loan losses totaled $2.5 million for the three months ended September 30, 2013, resulting in a provision for loan losses of $16.2 million for the nine months ended September 30, 2013, compared to $9.5 million for the three months ended September 30, 2012 and $29.5 million for the nine months ended September 30, 2012.  The decline in the provision for loan losses for the three and nine months ended September 30, 2013, compared to the three and nine months ended September 30, 2012, reflects the continued improvement in net loan charge-offs and delinquent and non-performing loans during the 2013 third quarter, as well as the contraction of the overall loan portfolio.  Net loan charge-offs declined to $3.4 million, or eleven basis points of average loans outstanding, annualized, for the three months ended September 30, 2013, compared to $9.1 million, or twenty-seven basis points of average loans outstanding, annualized, for the three months ended September 30, 2012, reflecting decreases of $2.8 million in net charge-offs on residential mortgage loans and $2.3 million in net charge-offs on multi-family and commercial real estate mortgage loans.  For the nine months ended September 30, 2013, net loan charge-offs declined to $18.7 million, or nineteen basis points of average loans outstanding, annualized, compared to $38.2 million, or thirty-eight basis points of average loans outstanding, annualized, for the nine months ended September 30, 2012, primarily due to a decline of $18.3 million in net charge-offs on residential mortgage loans.  Loans past due 30-89 days and accruing interest decreased $15.3 million since June 30, 2013 and decreased $54.8 million since December 31, 2012 to $127.1 million at September 30, 2013.  Non-performing loans, which are comprised primarily of mortgage loans, totaled $351.3 million, or 2.80% of total loans, at September 30, 2013, compared to $356.9 million, or 2.82% of total loans, at June 30, 2013 and $315.1 million, or 2.38% of total loans, at December 31, 2012.  Effective in the 2013 first quarter, in addition to bankruptcy loans placed on non-accrual status and reported as non-performing loans as of December 31, 2012, we also included bankruptcy loans discharged prior to 2012 regardless of the delinquency status of the loans which resulted in the increase in non-performing loans at September 30, 2013 compared to December 31, 2012, even as loans past due 90 days or more continued to decline to $263.4 million at September 30, 2013, compared to $278.1 million at June 30, 2013 and $301.4 million at December 31, 2012.  Non-performing loans at September 30, 2013 included $64.3 million of bankruptcy loans which were current or less than 90 days past due, including $49.9 million which were discharged prior to 2012.

The allowance for loan losses totaled $143.0 million at September 30, 2013, compared to $143.9 million at June 30, 2013 and $145.5 million at December 31, 2012.  The allowance for loan losses as a percentage of total loans was 1.14% at September 30, 2013 and at June 30, 2013, compared to 1.10% at December 31, 2012.  The allowance for loan losses as a percentage of non-performing loans was 40.71% at September 30, 2013, compared to 40.32% at June 30, 2013 and 46.18% at December 31, 2012.  The decrease in the allowance for loan losses as a percentage of non-performing loans at September 30, 2013 compared to December 31, 2012 was primarily due to the increase in non-performing loans which reflects the addition of the bankruptcy loans discharged prior to 2012 that are current or less than 90 days past due discussed above.  The changes in non-performing loans during any period are taken into account when determining the allowance for loan losses because the allowance coverage percentages we apply to our non-performing loans are generally higher than the allowance coverage percentages applied to our performing loans.  In evaluating our allowance coverage percentages for non-

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performing loans, we consider our aggregate historical loss experience with respect to the ultimate disposition of the underlying collateral.

When analyzing our asset quality trends and coverage ratios, consideration is given to the accounting for non-performing loans, particularly when reviewing our allowance for loan losses to non-performing loans ratio.  Included in our non-performing loans are residential mortgage loans which are 180 days or more past due for which we update our estimates of collateral values annually.  If the estimated fair value of the loan collateral less estimated selling costs is less than the recorded investment in the loan, a charge-off of the difference is recorded to reduce the loan to its estimated fair value less estimated selling costs.  Therefore, certain losses inherent in our non-performing residential mortgage loans are being recognized through a charge-off at 180 days of delinquency and annually thereafter.  The impact of updating these estimates of collateral value and recognizing any required charge-offs is to increase charge-offs and reduce the allowance for loan losses required on these loans.  Therefore, when reviewing the adequacy of the allowance for loan losses as a percentage of non-performing loans, the impact of these charge-offs is considered.  Non-performing loans included residential mortgage loans which were 180 days or more past due totaling $213.6 million, net of $66.7 million in charge-offs related to such loans, at September 30, 2013 and $242.0 million, net of $79.4 million in charge-offs related to such loans, at December 31, 2012.

While ratio analyses are used as a supplemental tool for evaluating the overall reasonableness of the allowance for loan losses, the adequacy of the allowance for loan losses is ultimately determined by the actual losses and charges recognized in the portfolio.  We update our loss analyses quarterly to ensure that our allowance coverage percentages are adequate and the overall allowance for loan losses is our best estimate of loss as of a particular point in time.  Our 2013 third quarter analysis of loss severity on residential mortgage loans, defined as the ratio of net write-downs taken through disposition of the asset (typically the sale of REO or a short sale) to the loan’s original principal balance, for the twelve months ended June 30, 2013, indicated an average loss severity of approximately 30%, compared to approximately 32% in our 2013 second quarter analysis and 33% in our 2013 first quarter and 2012 fourth quarter analyses.  Our analysis in the 2013 third quarter reviewed residential REO sales and short sales which occurred during the twelve months ended June 30, 2013 and included both full documentation and reduced documentation loans in a variety of states with varying years of origination.  Our 2013 third quarter analysis of charge-offs on multi-family and commercial real estate mortgage loans, generally related to sales of certain delinquent and non-performing loans transferred to held-for-sale and loans modified in a TDR, during the twelve months ended June 30, 2013 indicated an average loss severity of approximately 19%, unchanged from our 2013 second quarter analysis and a decline compared to 22% in our 2013 first quarter analysis and 31% in our 2012 fourth quarter analysis.  We consider our average loss severity experience as a gauge in evaluating the overall adequacy of our allowance for loan losses.  However, the uniqueness of each multi-family and commercial real estate loan, particularly multi-family loans within New York City, many of which are rent stabilized, is also factored into our analyses.  The ratio of the allowance for loan losses to non-performing loans was approximately 41% at September 30, 2013, which exceeds our average loss severity experience for our mortgage loan portfolios, supporting our determination that our allowance for loan losses is adequate to cover potential losses.

We obtain updated estimates of collateral values on residential mortgage loans at 180 days past due and earlier in certain instances and, to the extent the loans remain delinquent, annually

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thereafter.  Updated estimates of collateral values on residential loans are obtained primarily through automated valuation models. Additionally, our loan servicer performs property inspections to monitor and manage the collateral on our residential loans when they become 45 days past due and monthly thereafter until the foreclosure process is complete. We obtain updated estimates of collateral value using third party appraisals on non-performing multi-family and commercial real estate mortgage loans when the loans initially become non-performing and annually thereafter and multi-family and commercial real estate loans modified in a TDR at the time of the modification and annually thereafter.  Appraisals on multi-family and commercial real estate loans are reviewed by our internal certified appraisers.  We also obtain updated estimates of collateral value for certain other loans when the Asset Classification Committee believes repayment of such loans may be dependent on the value of the underlying collateral. Adjustments to final appraised values obtained from independent third party appraisers and automated valuation models are not made.

During the 2013 first quarter, total delinquencies decreased $14.7 million since December 31, 2012 and net loan charge-offs decreased compared to the 2012 fourth quarter.  The national unemployment rate was 7.6% for March 2013 and there were job gains for the quarter totaling 504,000 at the time of our analysis.  We continued to update our charge-off and loss analysis during the 2013 first quarter and modified our allowance coverage percentages accordingly.  As a result of these factors, our allowance for loan losses decreased slightly compared to December 31, 2012 and totaled $144.3 million at March 31, 2013 which resulted in a provision for loan losses of $9.1 million for the 2013 first quarter.  During the 2013 second quarter, total delinquencies decreased $39.1 million since March 31, 2013, net loan charge-offs decreased compared to the 2013 first quarter, the national unemployment rate remained flat and job gains totaled 589,000 at the time of our analysis.  We continued to update our charge-off and loss analysis during the 2013 second quarter and modified our allowance coverage percentages accordingly.  As a result of these factors, our allowance for loan losses decreased slightly compared to March 31, 2013 and totaled $143.9 million at June 30, 2013 which resulted in a provision for loan losses of $4.5 million for the 2013 second quarter and $13.7 million for the six months ended June 30, 2013.  During the 2013 third quarter, total delinquencies decreased $30.6 million since June 30, 2013.  The national unemployment rate decreased to 7.2% for September 2013 and there were job gains for the quarter totaling 430,000 at the time of our analysis.  Net loan charge-offs decreased for the 2013 third quarter compared to the 2013 second quarter.  We continued to update our charge-off and loss analysis during the 2013 third quarter and modified our allowance coverage percentages accordingly.  As a result of these factors, our allowance for loan losses decreased slightly compared to June 30, 2013 and totaled $143.0 million at September 30, 2013 which resulted in a provision for loan losses of $2.5 million for the three months ended September 30, 2013 and $16.2 million for the nine months ended September 30, 2013.

There are no material assumptions relied on by management which have not been made apparent in our disclosures or reflected in our asset quality ratios and activity in the allowance for loan losses.  We believe our allowance for loan losses has been established and maintained at levels that reflect the risks inherent in our loan portfolio, giving consideration to the composition and size of our loan portfolio, the levels and composition of loan delinquencies and non-performing loans, our loss history and our evaluation of the housing and real estate markets and the current economic environment.  The balance of our allowance for loan losses represents management’s

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best estimate of the probable inherent losses in our loan portfolio at September 30, 2013 and December 31, 2012.

For further discussion of the methodology used to determine the allowance for loan losses, see “Critical Accounting Policies-Allowance for Loan Losses” and for further discussion of our loan portfolio composition and non-performing loans, see “Asset Quality” and Note 4 of Notes to Consolidated Financial Statements in Part I, Item 1, “Financial Statements (Unaudited).”

Non-Interest Income

Non-interest income decreased $1.3 million to $15.3 million for the three months ended September 30, 2013, from $16.6 million for the three months ended September 30, 2012, primarily due to decreases in customer service fees and income from bank owned life insurance.  For the nine months ended September 30, 2013, non-interest income increased slightly to $52.2 million, compared to $51.6 million for the nine months ended September 30, 2012, as higher mortgage banking income, net, was substantially offset by lower customer fees, income from bank owned life insurance, gain on sale of securities and other loan fees.

Customer service fees decreased $937,000 to $9.6 million for the three months ended September 30, 2013, from $10.5 million for the three months ended September 30, 2012, and decreased $2.8 million to $27.7 million for the nine months ended September 30, 2013, from $30.5 million for the nine months ended September 30, 2012.  The lower levels of customer service fees in 2013 compared to 2012 primarily reflect declines in overdraft fees related to transaction accounts, coupled with declines in various other customer service fee revenues such as ATM fees, other checking charges, minimum balance fees and commissions on sales of insurance products.

Mortgage banking income, net, which includes loan servicing fees, net gain on sales of loans, amortization of MSR and valuation allowance adjustments for the impairment of MSR, increased $5.0 million to $10.1 million for the nine months ended September 30, 2013, from $5.1 million for the nine months ended September 30, 2012, primarily due to recoveries recorded in the valuation allowance for the impairment of MSR for the nine months ended September 30, 2013, compared to provisions recorded for the nine months ended September 30, 2012.  The recoveries recorded in 2013 were primarily the result of a significant decrease in the estimated weighted average constant prepayment rate on mortgages and a corresponding increase in the estimated weighted average life of the servicing portfolio at September 30, 2013 compared to December 31, 2012 reflecting the increase in U.S. Treasury rates beginning in the latter part of the 2013 second quarter and continuing into the 2013 third quarter.

Income from bank owned life insurance decreased $474,000 to $2.0 million for the three months ended September 30, 2013, compared to $2.4 million for the three months ended September 30, 2012, and decreased $862,000 to $6.2 million for the nine months ended September 30, 2013, from $7.1 million for the nine months ended September 30, 2012, primarily due to a decrease in the crediting rate paid on our investment.  For the nine months ended September 30, 2013, compared to the nine months ended September 30, 2012, the decline in gain on sales of securities reflects a reduction in the volume of securities sold and the decline in other loan fees was primarily due to a decline in late payment charges related to our residential mortgage loan portfolio.

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Non-Interest Expense

Non-interest expense decreased slightly to $72.5 million for the three months ended September 30, 2013, compared to $72.6 million for the three months ended September 30, 2012, primarily due to lower federal deposit insurance premium expense in 2013 and an extinguishment of debt expense recorded in the 2012 third quarter, the effects of which were substantially offset by increased compensation and benefits expense and other non-interest expense.  For the nine months ended September 30, 2013, non-interest expense decreased $8.4 million to $218.5 million, from $226.9 million for the nine months ended September 30, 2012.  This decline reflects lower federal deposit insurance premium expense, compensation and benefits expense and other non-interest expense, partially offset by increases in occupancy, equipment and systems expense and extinguishment of debt expense.  Our percentage of general and administrative expense to average assets, annualized, increased to 1.81% for the three months ended September 30, 2013, from 1.67% for the three months ended September 30, 2012, and increased to 1.80% for the nine months ended September 30, 2013, from 1.76% for the nine months ended September 30, 2012.  The increases in these ratios for the three and nine months ended September 30, 2013, compared to the three and nine months ended September 30, 2012, primarily reflect the declines in average assets for the respective periods, partially offset by the decline in general administrative expenses for the nine months ended September 30, 2013 compared to the nine months ended September 30, 2012.

Compensation and benefits expense increased $3.1 million to $33.9 million for the three months ended September 30, 2013, from $30.8 million for the three months ended September 30, 2012, primarily due to increases in salaries and officer incentive accruals, ESOP expense and the employer matching contribution for the 401(k) incentive savings plan which began in 2013.  For the nine months ended September 30, 2013, compensation and benefits expense decreased $5.8 million to $99.3 million, from $105.1 million for the nine months ended September 30, 2012.  This reduction in compensation and benefits expense largely relates to the impact of the cost control initiatives implemented in the 2012 first quarter.  Compensation and benefits expense for the nine months ended September 30, 2012 included one-time net charges totaling $3.4 million associated with these initiatives.  As a result of plan amendments which were approved by our Board of Directors in the 2012 first quarter in conjunction with our overall cost control initiatives, the net periodic cost for our defined benefit pension plans decreased to $110,000 for the nine months ended September 30, 2013, compared to $6.0 million for the nine months ended September 30, 2012.  Also contributing to the decrease in compensation and benefits expense for the nine months ended September 30, 2013 was a $3.1 million reduction in the 2013 first quarter resulting from a revision in the accrual for compensated absences related to changes in certain compensation policies which became effective January 1, 2013.  Increases in salaries and officer incentive accruals and the employer matching 401(k) contribution in 2013 partially offset the aforementioned declines in compensation and benefits expense for the nine months ended September 30, 2013 compared to the nine months ended September 30, 2012.

Occupancy, equipment and systems expense increased $3.7 million to $53.7 million for the nine months ended September 30, 2013, compared to $50.0 million for the nine months ended September 30, 2012, primarily due to a one-time charge of $2.5 million recorded in the 2013 first quarter to conform to a straight-line basis the rental expense on operating leases for certain branch locations, coupled with increases in equipment expenses, data processing charges and real estate taxes.

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Federal deposit insurance premium expense decreased $3.3 million to $9.2 million for the three months ended September 30, 2013, compared to $12.5 million for the three months ended September 30, 2012, and decreased $7.2 million to $28.4 million for the nine months ended September 30, 2013, compared to $35.6 million for the nine months ended September 30, 2012, reflecting a reduction in both our assessment base and assessment rate.

Extinguishment of debt expense totaled $4.3 million for the nine months ended September 30, 2013 and $1.2 million for the nine months ended September 30, 2012.  The charge in 2013 was the result of the prepayment in whole of our Junior Subordinated Debentures in May 2013 using the proceeds from the issuance in March 2013 of our Series C Preferred Stock.  The charge in 2012 was the result of the prepayment of our 5.75% senior unsecured notes in September 2012 using the proceeds from the issuance in June 2012 of our 5.00% senior unsecured notes.

Other non-interest expense increased to $10.4 million for the three months ended September 30, 2013, compared to $9.6 million for the three months ended September 30, 2012, primarily due to an increase in REO related expenses, partially offset by declines in OCC assessments and other loan related expenses.  For the nine months ended September 30, 2013, other non-interest expense decreased $2.8 million to $26.7 million, compared to $29.5 million for the nine months ended September 30, 2012, primarily due to reductions in REO related expenses, OCC assessments and other loan related expenses.  REO related expenses increased to $3.4 million for the three months ended September 30, 2013, compared to $1.7 million for the three months ended September 30, 2012, primarily due to an increase in foreclosure related costs.  For the nine months ended September 30, 2013, REO related expenses declined to $5.5 million, compared to $6.4 million for the nine months ended September 30, 2012.

Income Tax Expense

For the three months ended September 30, 2013, income tax expense totaled $9.5 million, representing an effective tax rate of 36.0%, compared to $7.1 million for the three months ended September 30, 2012, representing an effective tax rate of 34.6%.  For the nine months ended September 30, 2013, income tax expense totaled $26.2 million, representing an effective tax rate of 36.1%, compared to $19.8 million for the nine months ended September 30, 2012, representing an effective tax rate of 35.4%.

Asset Quality

One of our key operating objectives has been and continues to be to maintain a high level of asset quality.  We continue to employ sound underwriting standards for new loan originations.  Through a variety of strategies, including, but not limited to, collection efforts and the marketing of delinquent and non-performing loans and foreclosed properties, we have been proactive in addressing problem and non-performing assets which, in turn, has helped to maintain the strength of our financial condition.

The composition of our loan portfolio by property type has remained relatively consistent over the last several years.  However, as a result of our continuing efforts to reposition the asset mix of our balance sheet, our multi-family mortgage loans increased to represent 25% of our total loan portfolio at September 30, 2013, compared to 18% at December 31, 2012, and our

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commercial real estate loans increased to represent 7% of our total loan portfolio, compared to 6% at December 31, 2012.  In contrast, our residential mortgage loan portfolio decreased to represent 66% of our total loan portfolio at September 30, 2013, compared to 74% at December 31, 2012.  At September 30, 2013 and December 31, 2012, the remaining 2% of our total loan portfolio was comprised of consumer and other loans.

We continue to adhere to prudent underwriting standards.  We underwrite our residential mortgage loans primarily based upon our evaluation of the borrower’s ability to pay.  We do not originate negative amortization loans, payment option loans or other loans with short-term interest-only periods.  Additionally, we do not originate one-year ARM loans.  The ARM loans in our portfolio which currently reprice annually represent hybrid ARM loans (interest-only and amortizing) which have passed their initial fixed rate period.  In 2006, we began underwriting our residential interest-only hybrid ARM loans based on a fully amortizing loan (in effect, underwriting interest-only hybrid ARM loans as if they were amortizing hybrid ARM loans).  Prior to 2007, we would underwrite our residential interest-only hybrid ARM loans using the initial note rate, which may have been a discounted rate.  In 2007, we began underwriting our residential interest-only hybrid ARM loans at the higher of the fully indexed rate or the initial note rate.  In 2009, we began underwriting our residential interest-only and amortizing hybrid ARM loans at the higher of the fully indexed rate, the initial note rate or 6.00%.  During the 2010 second quarter, we reduced the underwriting interest rate floor from 6.00% to 5.00% to reflect the interest rate environment.  During the 2010 third quarter, we stopped offering interest-only loans.  Our reduced documentation loans are comprised primarily of SIFA (stated income, full asset) loans.  To a lesser extent, reduced documentation loans in our portfolio also include SISA (stated income, stated asset) loans.  During the 2007 fourth quarter, we stopped offering reduced documentation loans.

Full documentation loans comprised 90% of our total mortgage loan portfolio at September 30, 2013, compared to 89% at December 31, 2012, and comprised 85% of our residential mortgage loan portfolio at September 30, 2013, compared to 86% at December 31, 2012.  The following table provides further details on the composition of our residential mortgage loan portfolio in dollar amounts and percentages of the portfolio at the dates indicated.

	At September 30, 2013			At December 31, 2012
(Dollars in Thousands)	Amount		Percent  of Total	Amount		Percent  of Total
Residential mortgage loans:
Full documentation interest-only (1)	$	1,525,837	18.39%	$	2,001,396	20.61%
Full documentation amortizing	5,501,024		66.28	6,304,872		64.92
Reduced documentation interest-only (1)(2)	879,546		10.60	1,005,295		10.35
Reduced documentation amortizing (2)	392,111		4.73	399,663		4.12
Total residential mortgage loans	$	8,298,518	100.00%	$	9,711,226	100.00%

(1)Interest-only loans require the borrower to pay interest only during the first ten years of the loan term.  After the tenth anniversary of the loan, principal and interest payments are required to amortize the loan over the remaining loan term.  Includes interest-only hybrid ARM loans originated prior to 2007 which were underwritten at the initial note rate, which may have been a discounted rate, totaling $1.78 billion at September 30, 2013 and $2.18 billion at December 31, 2012.

(2)Includes SISA loans totaling $201.0 million at September 30, 2013 and $222.7 million at December 31, 2012.

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The market does not apply a uniform definition of what constitutes “subprime” lending.  Our reference to subprime lending relies upon the “Statement on Subprime Mortgage Lending” issued by the Agencies in June 2007, which further references the “Expanded Guidance for Subprime Lending Programs,” or the Expanded Guidance, issued by the Agencies by press release in January 2001.  In the Expanded Guidance, the Agencies indicated that subprime lending does not refer to individual subprime loans originated and managed, in the ordinary course of business, as exceptions to prime risk selection standards.  The Agencies recognize that many prime loan portfolios will contain such accounts.  The Agencies also excluded prime loans that develop credit problems after acquisition and community development loans from the subprime arena.  According to the Expanded Guidance, subprime loans are other loans to borrowers which display one or more characteristics of reduced payment capacity.  Five specific criteria, which are not intended to be exhaustive and are not meant to define specific parameters for all subprime borrowers and may not match all markets or institutions’ specific subprime definitions, are set forth, including having a credit (FICO) score of 660 or below.  However, we do not associate a particular FICO score with our definition of subprime loans.  Consistent with the guidance provided by the Agencies, we consider subprime loans to be loans to borrowers with a credit history containing one or more of the following at the time of origination: (1) bankruptcy within the last four years; (2) foreclosure within the last two years; or (3) two 30 day mortgage delinquencies in the last twelve months.  In addition, subprime loans generally display the risk layering of the following features: high debt-to-income ratio; low or no cash reserves; loan-to-value ratios over 90%; short-term interest-only periods or negative amortization loan products; or reduced or no documentation loans.  Our current underwriting standards would generally preclude us from originating loans to borrowers with a credit history containing a bankruptcy or a foreclosure within the last five years or two 30 day mortgage delinquencies in the last twelve months.  Based upon the definition and exclusions described above, we are a prime lender.  Within our portfolio of residential mortgage loans, we have loans to borrowers who had FICO scores of 660 or below at the time of origination. However, as a portfolio lender we underwrite our loans considering all credit criteria, as well as collateral value, and do not base our underwriting decisions solely on FICO scores.  Based on our underwriting criteria, particularly the average loan-to-value ratios at origination, we consider our loans to borrowers with FICO scores of 660 or below at origination to be prime loans.

At September 30, 2013, our residential mortgage loan portfolio totaled $8.30 billion, of which $860.1 million, or 10%, represented loans to borrowers with FICO scores of 660 or below.  Interest-only loans comprised 64% of the loans to borrowers with FICO scores of 660 or below and 36% were amortizing loans.  In addition, 59% of our loans to borrowers with FICO scores of 660 or below were full documentation loans and 41% were reduced documentation loans.  We believe the aforementioned loans, when originated, were amply collateralized and otherwise conformed to our prime lending standards and do not present a greater risk of loss or other asset quality risk relative to comparable loans in our portfolio to other borrowers with higher credit scores.

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Non-Performing Assets

The following table sets forth information regarding non-performing assets at the dates indicated.

(Dollars in Thousands)	At September 30, 2013		At December 31, 2012
Non-performing loans (1):
Mortgage loans:
Residential	$	318,418	$	291,051
Multi-family	15,661		10,658
Commercial real estate (2)	10,668		6,869
Consumer and other loans	6,506		6,508
Total non-performing loans	351,253		315,086
REO, net (3)	34,983		28,523
Total non-performing assets	$	386,236	$	343,609
Non-performing loans to total loans	2.80%		2.38%
Non-performing loans to total assets	2.19		1.91
Non-performing assets to total assets	2.41		2.08
Allowance for loan losses to non-performing loans	40.71		46.18
Allowance for loan losses to total loans	1.14		1.10

(1)	Non-performing loans are comprised primarily of non-accrual loans. Non-performing loans at September 30, 2013 included loans modified in a TDR totaling $117.1 million, of which $84.0 million were less than 90 days past due including $74.6 million which were current. At December 31, 2012, non-performing loans included loans modified in a TDR totaling $32.8 million, of which $13.7 million were less than 90 days past due including $11.1 million which were current. Non-performing loans exclude loans which have been modified in a TDR and are accruing and performing in accordance with the restructured terms for a satisfactory period of time, generally six months. Restructured accruing loans totaled $90.7 million at September 30, 2013 and $98.7 million at December 31, 2012.
(2)	Includes mortgage loans delinquent 90 days or more as to their maturity date but not their interest due and still accruing interest totaling $55,000 at September 30, 2013 and $328,000 at December 31, 2012.
(3)	REO, all of which are residential properties, is net of a valuation allowance which totaled $477,000 at September 30, 2013 and $1.6 million at December 31, 2012.

Total non-performing assets increased $42.6 million to $386.2 million at September 30, 2013, from $343.6 million at December 31, 2012, reflecting an increase in non-performing loans, coupled with an increase in REO, net.  The ratio of non-performing assets to total assets was 2.41% at September 30, 2013, compared to 2.08% at December 31, 2012.  The ratio of non-performing loans to total loans was 2.80% at September 30, 2013, compared to 2.38% at December 31, 2012.  The increases in these ratios primarily reflect the change in non-performing loans, the most significant component of non-performing assets, which increased $36.2 million to $351.3 million at September 30, 2013, from $315.1 million at December 31, 2012.  Effective in the 2013 first quarter, in addition to bankruptcy loans placed on non-accrual status and reported as non-performing loans and as loans modified in a TDR as of December 31, 2012, we also included bankruptcy loans discharged prior to 2012 regardless of the delinquency status of the loans, as discussed further below, which resulted in an increase in non-performing loans at September 30, 2013 compared to December 31, 2012, even as loans 90 days or more past due continued to decline.  The increase in REO, net, at September 30, 2013 compared to December 31, 2012 primarily reflects an increase in the number of loans that shifted from non-performing delinquent loans to REO during the 2013 third quarter.

We may agree, in certain instances, to modify the contractual terms of a borrower’s loan.  In cases where such modifications represent a concession to a borrower experiencing financial difficulty, the modification is considered a TDR.  Bankruptcy loans are also reported as loans

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modified in a TDR, as relief granted by a court is also viewed as a concession to the borrower in the loan agreement.  Loans modified in a TDR are initially placed on non-accrual status regardless of their delinquency status.  Loans modified in a TDR which are included in non-accrual loans totaled $117.1 million at September 30, 2013 and $32.8 million at December 31, 2012, of which $84.0 million at September 30, 2013 and $13.7 million at December 31, 2012 were current or less than 90 days past due.  The increase in restructured non-accrual loans is primarily related to the aforementioned inclusion of bankruptcy loans discharged prior to 2012 effective in the 2013 first quarter.  Bankruptcy loans totaled $88.0 million at September 30, 2013, including $66.3 million which were discharged prior to 2012, and totaled $12.5 million at December 31, 2012.  Of the total bankruptcy loans, $64.3 million were current or less than 90 days past due at September 30, 2013, including $49.9 million which were discharged prior to 2012, and $5.7 million were current or less than 90 days past due at December 31, 2012.  Such loans which are current or less than 90 days past due continue to generate interest income on a cash basis as payments are received.  Loans modified in a TDR, other than bankruptcy loans, remain in non-accrual status until we determine that future collection of principal and interest is reasonably assured, which requires that the borrower demonstrate performance according to the restructured terms generally for a period of six months.  When such loans have complied with the terms of their restructure agreement for a satisfactory period of time, they are excluded from non-performing assets.  Restructured accruing loans totaled $90.7 million at September 30, 2013 and $98.7 million at December 31, 2012.  The decline in restructured accruing loans was primarily attributable to multi-family and commercial real estate loans that were repaid during 2013 and loans that were transferred to held-for-sale and sold during the 2013 first quarter.

We discontinue accruing interest on loans when they become 90 days delinquent as to their payment due date, at the time of restructure if the loan is deemed a TDR and certain other loans because of deterioration in financial or other conditions of the borrower.  In addition, we reverse all previously accrued and uncollected interest through a charge to interest income.  While loans are in non-accrual status, interest due is monitored and, presuming we deem the remaining recorded investment in the loan to be fully collectible, income is recognized only to the extent cash is received until a return to accrual status is warranted.  If all non-accrual loans at September 30, 2013 and 2012 had been performing in accordance with their original terms, we would have recorded interest income, with respect to such loans, of $12.5 million for the nine months ended September 30, 2013 and $13.1 million for the nine months ended September 30, 2012.  This compares to actual payments recorded as interest income, with respect to such loans, of $4.9 million for the nine months ended September 30, 2013 and $2.7 million for the nine months ended September 30, 2012.

We proactively manage our non-performing assets, in part, through the sale of certain delinquent and non-performing loans.  Included in loans held-for-sale, net, are delinquent and non-performing mortgage loans totaling $884,000 at September 30, 2013 and $3.9 million at December 31, 2012.  Such loans are excluded from non-performing loans, non-performing assets and related ratios.

In addition to non-performing loans, we had $171.0 million of potential problem loans at September 30, 2013, compared to $191.5 million at December 31, 2012.  Such loans include loans past due 60-89 days and accruing interest and certain other internally adversely classified loans.

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Non-performing residential mortgage loans continue to include a greater concentration of reduced documentation loans as compared to the entire residential mortgage loan portfolio.  Reduced documentation loans represented only 15% of the residential mortgage loan portfolio, yet represented 49% of non-performing residential mortgage loans at September 30, 2013.  The following table provides further details on the composition of our non-performing residential mortgage loans in dollar amounts and percentages of the portfolio, at the dates indicated.

	At September 30, 2013			At December 31, 2012
(Dollars in Thousands)	Amount		Percent of Total	Amount		Percent of Total
Non-performing residential mortgage loans:
Full documentation interest-only	$	108,684	34.13%	$	99,521	34.19%
Full documentation amortizing	52,541		16.50	44,326		15.23
Reduced documentation interest-only	124,524		39.11	113,482		38.99
Reduced documentation amortizing	32,669		10.26	33,722		11.59
Total non-performing residential mortgage loans (1)	$	318,418	100.00%	$	291,051	100.00%

(1)Includes $73.7 million of loans less than 90 days past due at September 30, 2013, of which $65.0 million were current, and includes $10.4 million of loans less than 90 days past due at December 31, 2012, of which $7.8 million were current.

The following table provides details on the geographic composition of both our total and non-performing residential mortgage loans at September 30, 2013.

	Residential Mortgage Loans
	At September 30, 2013
(Dollars in Millions)	Total Loans		Percent of Total Loans	Total Non-Performing Loans (1)		Percent of Total Non-Performing Loans	Non-Performing Loans as Percent of State Totals
State:
New York	$	2,455.5	29.6%	$	51.7	16.2%	2.11%
Connecticut	860.0		10.4	36.0		11.3	4.19
Illinois	778.1		9.4	37.9		11.9	4.87
Massachusetts	690.6		8.3	13.1		4.1	1.90
New Jersey	600.1		7.2	60.2		18.9	10.03
Virginia	561.8		6.8	15.2		4.8	2.71
Maryland	506.8		6.1	40.6		12.8	8.01
California	501.6		6.0	26.6		8.4	5.30
Washington	227.3		2.7	3.2		1.0	1.41
Texas	207.7		2.5	—		—	—
All other states (2) (3)	909.0		11.0	33.9		10.6	3.73
Total	$	8,298.5	100.0%	$	318.4	100.0%	3.84%

(1)Includes loans which were current or less than 90 days past due totaling $73.7 million.

(2)Includes 25 states and Washington, D.C.

(3)Includes Florida with $152.8 million total loans, of which $14.2 million were non-performing loans.

At September 30, 2013, the geographic composition of our multi-family and commercial real estate mortgage loan portfolio was 98% in the New York metropolitan area and 2% in various other states and the geographic composition of non-performing multi-family and commercial real estate mortgage loans was 93% in the New York metropolitan area, 6% in Pennsylvania and 1% in Massachusetts.

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Delinquent Loans

The following table shows a comparison of delinquent loans at the dates indicated.  Delinquent loans are reported based on the number of days the loan payments are past due.

	30-59 Days Past Due			60-89 Days Past Due			90 Days or More Past Due
(Dollars in Thousands)	Number of Loans	Amount		Number of Loans	Amount		Number of Loans	Amount
At September 30, 2013:
Mortgage loans:
Residential	326	$	93,315	80	$	27,026	808	$	244,691
Multi-family	23	9,991		7	1,811		17	11,037
Commercial real estate	—	—		4	1,961		3	1,153
Consumer and other loans	57	2,633		24	1,386		52	6,474
Total delinquent loans	406	$	105,939	115	$	32,184	880	$	263,355
Delinquent loans to total loans		0.84%			0.26%			2.10%
At December 31, 2012:
Mortgage loans:
Residential	352	$	108,280	101	$	27,814	946	$	280,671
Multi-family	39	21,743		14	5,382		13	7,359
Commercial real estate	10	13,536		6	3,126		6	6,869
Consumer and other loans	82	3,223		33	1,315		56	6,508
Total delinquent loans	483	$	146,782	154	$	37,637	1,021	$	301,407
Delinquent loans to total loans		1.11%			0.28%			2.28%

Allowance for Loan Losses

The following table summarizes activity in the allowance for loan losses.

(In Thousands)	For the Nine Months Ended September 30, 2013
Balance at January 1, 2013	$	145,501
Provision charged to operations	16,193
Charge-offs:
Residential	(20,332)
Multi-family	(3,637)
Commercial real estate	(2,313)
Consumer and other loans	(1,672)
Total charge-offs	(27,954)
Recoveries:
Residential	7,001
Multi-family	1,237
Commercial real estate	535
Consumer and other loans	487
Total recoveries	9,260
Net charge-offs (1)	(18,694)
Balance at September 30, 2013	$	143,000

(1)Includes net charge-offs of $4.3 million related to reduced documentation residential mortgage loans and $3.8 million related to certain delinquent and non-performing loans transferred to held-for-sale.

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ITEM 3.Quantitative and Qualitative Disclosures about Market Risk

As a financial institution, the primary component of our market risk is interest rate risk.  The objective of our interest rate risk management policy is to maintain an appropriate mix and level of assets, liabilities and off-balance sheet items to enable us to meet our earnings and/or growth objectives, while maintaining specified minimum capital levels as required by our primary banking regulator, in the case of Astoria Federal, and as established by our Board of Directors.  We use a variety of analyses to monitor, control and adjust our asset and liability positions, primarily interest rate sensitivity gap analysis, or gap analysis, and net interest income sensitivity analysis.  Additional interest rate risk modeling is done by Astoria Federal in conformity with regulatory requirements.

Gap Analysis

Gap analysis measures the difference between the amount of interest-earning assets anticipated to mature or reprice within specific time periods and the amount of interest-bearing liabilities anticipated to mature or reprice within the same time periods.  Gap analysis does not indicate the impact of general interest rate movements on our net interest income because the actual repricing dates of various assets and liabilities will differ from our estimates and it does not give consideration to the yields and costs of the assets and liabilities or the projected yields and costs to replace or retain those assets and liabilities.  Callable features of certain assets and liabilities, in addition to the foregoing, may also cause actual experience to vary from the analysis.

The following table, referred to as the Gap Table, sets forth the amount of interest-earning assets and interest-bearing liabilities outstanding at September 30, 2013 that we anticipate will reprice or mature in each of the future time periods shown using certain assumptions based on our historical experience and other market-based data available to us.  The Gap Table includes $700.0 million of borrowings which are callable within one year and on a quarterly basis thereafter and $200.0 million of borrowings which are callable in 2015, all classified according to their maturity dates primarily in the more than three years to five years category; and $1.05 billion of borrowings which are callable in 2016 and 2017 classified according to their maturity dates in the more than five years category.  In addition, the Gap Table includes callable securities with an amortized cost of $186.8 million which are callable within one year and at various times thereafter classified according to their maturity dates in the more than five years category.  The classification of callable borrowings and securities according to their maturity dates is based on our experience with, and expectations of, the behavior of these types of instruments in the current interest rate environment.  As indicated in the Gap Table, our one-year interest rate sensitivity gap at September 30, 2013 was positive 5.53% compared to positive 13.23% at December 31, 2012.  The change in our one-year cumulative gap is primarily due to a decrease in the balances of mortgage loans and securities projected to mature or reprice within one year at September 30, 2013, compared to December 31, 2012, and reflects the decline in the levels of prepayments on our mortgage loan and mortgage-backed securities portfolios that is expected to result from the increase in long-term interest rates, the effects of which we began to experience near the end of the 2013 third quarter.

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	At September 30, 2013
(Dollars in Thousands)	One Year or Less			More than One Year to Three Years			More than Three Years to Five Years			More than Five Years			Total
Interest-earning assets:
Mortgage loans (1)	$	4,219,762		$	2,927,420		$	3,728,360		$	1,103,275		$	11,978,817
Consumer and other loans (1)	205,989			16,485			14,476			689			237,639
Interest-earning cash accounts	110,120			—			—			—			110,120
Securities available-for-sale	73,279			70,967			91,683			183,182			419,111
Securities held-to-maturity	349,018			430,242			464,054			639,275			1,882,589
FHLB-NY stock	—			—			—			153,217			153,217
Total interest-earning assets	4,958,168			3,445,114			4,298,573			2,079,638			14,781,493
Net unamortized purchase premiums and deferred costs (2)	27,997			22,258			26,953			18,815			96,023
Net interest-earning assets (3)	4,986,165			3,467,372			4,325,526			2,098,453			14,877,516
Interest-bearing liabilities:
Savings	353,558			400,025			400,025			1,409,319			2,562,927
Money market	1,123,100			379,617			379,617			31,273			1,913,607
NOW and demand deposit	109,484			219,016			219,016			1,585,546			2,133,062
Certificates of deposit	1,453,690			1,749,253			247,835			—			3,450,778
Borrowings, net	1,060,472			848,944			1,049,612			1,150,000			4,109,028
Total interest-bearing liabilities	4,100,304			3,596,855			2,296,105			4,176,138			14,169,402
Interest rate sensitivity gap	885,861			(129,483		)	2,029,421			(2,077,685		)	$	708,114
Cumulative interest rate sensitivity gap	$	885,861		$	756,378		$	2,785,799		$	708,114
Cumulative interest rate sensitivity gap as a percentage of total assets	5.53		%	4.72		%	17.39		%	4.42		%
Cumulative net interest-earning assets as a percentage of interest- bearing liabilities	121.60		%	109.83		%	127.88		%	105.00		%

(1)Mortgage loans and consumer and other loans include loans held-for-sale and exclude non-performing loans, except non-performing residential loans which are current or less than 90 days past due, and the allowance for loan losses.

(2)Net unamortized purchase premiums and deferred costs are prorated.

(3)Includes securities available-for-sale at amortized cost.

Net Interest Income Sensitivity Analysis

In managing interest rate risk, we also use an internal income simulation model for our net interest income sensitivity analyses.  These analyses measure changes in projected net interest income over various time periods resulting from hypothetical changes in interest rates.  The interest rate scenarios most commonly analyzed reflect gradual and reasonable changes over a specified time period, which is typically one year.  The base net interest income projection utilizes similar assumptions as those reflected in the Gap Table, assumes that cash flows are reinvested in similar assets and liabilities and that interest rates as of the reporting date remain constant over the projection period.  For each alternative interest rate scenario, corresponding changes in the cash flow and repricing assumptions of each financial instrument are made to determine the impact on net interest income.

We perform analyses of interest rate increases and decreases of up to 400 basis points (when reasonably practical) over various time horizons although changes in interest rates of 200 basis points over a one year horizon is a more common and reasonable scenario for analytical purposes.  Assuming the entire yield curve was to increase 200 basis points, through quarterly

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parallel increments of 50 basis points, our projected net interest income for the twelve month period beginning October 1, 2013 would decrease by approximately 2.32% from the base projection. At December 31, 2012, in the up 200 basis point scenario, our projected net interest income for the twelve month period beginning January 1, 2013 would have increased by approximately 6.16% from the base projection.  The current low interest rate environment prevents us from performing an income simulation for a decline in interest rates of the same magnitude and timing as our rising interest rate simulation, since certain asset yields, liability costs and related indices are below 2.00%.  However, assuming the entire yield curve was to decrease 100 basis points, through quarterly parallel decrements of 25 basis points, our projected net interest income for the twelve month period beginning October 1, 2013 would decrease by approximately 3.11% from the base projection.  At December 31, 2012, in the down 100 basis point scenario, our projected net interest income for the twelve month period beginning January 1, 2013 would have decreased by approximately 5.27% from the base projection.  The down 100 basis point scenarios include some limitations as well since certain indices, yields and costs are already below 1.00%.

Various shortcomings are inherent in both gap analyses and net interest income sensitivity analyses.  Certain assumptions may not reflect the manner in which actual yields and costs respond to market changes.  Similarly, prepayment estimates and similar assumptions are subjective in nature, involve uncertainties and, therefore, cannot be determined with precision.  Changes in interest rates may also affect our operating environment and operating strategies as well as those of our competitors.  In addition, certain adjustable rate assets have limitations on the magnitude of rate changes over specified periods of time.  Accordingly, although our net interest income sensitivity analyses may provide an indication of our interest rate risk exposure, such analyses are not intended to and do not provide a precise forecast of the effect of changes in market interest rates on our net interest income and our actual results will differ.  Additionally, certain assets, liabilities and items of income and expense which may be affected by changes in interest rates, albeit to a much lesser degree, and which do not affect net interest income, are excluded from this analysis.  These include income from bank owned life insurance and changes in the fair value of MSR.  With respect to these items alone, and assuming the entire yield curve was to increase 200 basis points, through quarterly parallel increments of 50 basis points, our projected net income for the twelve month period beginning October 1, 2013 would increase by approximately $3.5 million.  Conversely, assuming the entire yield curve was to decrease 100 basis points, through quarterly parallel decrements of 25 basis points, our projected net income for the twelve month period beginning October 1, 2013 would decrease by approximately $2.6 million with respect to these items alone.

For further information regarding our market risk and the limitations of our gap analysis and net interest income sensitivity analysis, see Part II, Item 7A, “Quantitative and Qualitative Disclosures about Market Risk,” included in our 2012 Annual Report on Form 10-K.

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ITEM 4.Controls and Procedures

Monte N. Redman, our President and Chief Executive Officer, and Frank E. Fusco, our Senior Executive Vice President and Chief Financial Officer, conducted an evaluation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, as of September 30, 2013.  Based upon their evaluation, they each found that our disclosure controls and procedures were effective to ensure that information required to be disclosed in the reports we file and submit under the Exchange Act is recorded, processed, summarized and reported as and when required and that such information is accumulated and communicated to our management as appropriate to allow timely decisions regarding required disclosure.

There were no changes in our internal controls over financial reporting that occurred during the three months ended September 30, 2013 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II - OTHER INFORMATION

ITEM 1.  Legal Proceedings

In the ordinary course of our business, we are routinely made a defendant in or a party to pending or threatened legal actions or proceedings which, in some cases, seek substantial monetary damages from or other forms of relief against us.  In our opinion, after consultation with legal counsel, we believe it unlikely that such actions or proceedings will have a material adverse effect on our financial condition, results of operations or liquidity.

City of New York Notice of Determination

By “Notice of Determination” dated September 14, 2010 and August 26, 2011, the City of New York notified us of alleged tax deficiencies in the amount of $13.3 million, including interest and penalties, related to our 2006 through 2008 tax years.  The deficiencies relate to our operation of two subsidiaries of Astoria Federal, Fidata and AF Mortgage.  We disagree with the assertion of the tax deficiencies.  Hearings in this matter were held before the NYC Tax Appeals Tribunal in March and April 2013.  The NYC Tax Appeals Tribunal is not expected to render a decision in this matter until the 2014 third quarter.  At this time, management believes it is more likely than not that we will succeed in refuting the City of New York’s position, although defense costs may be significant.  Accordingly, no liability or reserve has been recognized in our consolidated statement of financial condition at September 30, 2013 with respect to this matter.

No assurance can be given as to whether or to what extent we will be required to pay the amount of the tax deficiencies asserted by the City of New York, whether additional tax will be assessed for years subsequent to 2008, that this matter will not be costly to oppose, that this matter will not have an impact on our financial condition or results of operations or that, ultimately, any such impact will not be material.

Automated Transactions LLC Litigation

In November 2009, an action entitled Automated Transactions LLC v. Astoria Financial Corporation and Astoria Federal Savings and Loan Association was commenced in the Southern District Court against us by Automated Transactions LLC, alleging patent infringement involving integrated banking and transaction machines, including ATMs that we utilize.  The plaintiff sought unspecified monetary damages and an injunction preventing us from continuing

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to utilize the allegedly infringing machines.  In March 2011, the Southern District Court dismissed all claims against Astoria Financial Corporation but denied our motion to dismiss the claims against Astoria Federal for alleged direct patent infringement.

In July 2012, we filed a motion for summary judgment for non-infringement based on a ruling by the U.S. Court of Appeals for the Federal District affirming the decision of the Delaware District Court to grant summary judgment in favor of a defendant in an action involving the same plaintiff making substantially similar allegations with respect to identical and substantially similar patents as those involved in the action against us.  In April 2013, the U.S. Judicial Panel on Multidistrict Litigation transferred this action to the Delaware District Court to be centralized with other cases involving the same plaintiff and common questions of fact.

We settled this litigation, and the case was dismissed with prejudice, pursuant to a stipulation and order of dismissal on September 19, 2013.  The settlement was not material to our financial condition or results of operations and will not result in any restrictions or alteration in the use of our ATMs.  We intend to continue to pursue our demands for indemnification from the manufacturer and from the transaction processor utilized with respect to the integrated banking machines.

ITEM 1A.Risk Factors

For a summary of risk factors relevant to our operations, see Part I, Item 1A, “Risk Factors,” in our 2012 Annual Report on Form 10-K and Part II, Item 1A, “Risk Factors,” in our June 30, 2013 Quarterly Report on Form 10-Q.  There were no material changes in risk factors relevant to our operations since June 30, 2013.

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ITEM 2.Unregistered Sales of Equity Securities and Use of Proceeds

Our twelfth stock repurchase plan, approved by our Board of Directors on April 18, 2007, authorized the purchase of 10,000,000 shares, or approximately 10% of our common stock then outstanding, in open-market or privately negotiated transactions.  At September 30, 2013, a maximum of 8,107,300 shares may yet be purchased under this plan.  However, we are not currently repurchasing additional shares of our common stock and have not since the 2008 third quarter.

ITEM 3.Defaults Upon Senior Securities

Not applicable.

ITEM 4.Mine Safety Disclosures

Not applicable.

ITEM 5.Other Information

Not applicable.

ITEM 6.Exhibits

See Index of Exhibits on page 82.

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SIGNATURES

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, thereunto duly authorized.

				Astoria Financial Corporation
Dated:	November 6, 2013	By:	/s/	Monte N. Redman
				Monte N. Redman
				President and Chief Executive Officer
Dated:	November 6, 2013	By:	/s/	Frank E. Fusco
				Frank E. Fusco
				Senior Executive Vice President and
				Chief Financial Officer
				(Principal Accounting Officer)
Dated:	November 6, 2013	By:	/s/	John F. Kennedy
				John F. Kennedy
				Senior Vice President and
				Chief Accounting Officer

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ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES

INDEX OF EXHIBITS

Exhibit No.	Identification of Exhibit
31.1	Certifications of Chief Executive Officer. (*)
31.2	Certifications of Chief Financial Officer. (*)
32.1	Written Statement of Chief Executive Officer and Chief Financial Officer furnished pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. Pursuant to SEC rules, this exhibit will not be deemed filed for purposes of Section 18 of the Exchange Act or otherwise subject to the liability of that section. (*)
101.INS	XBRL Instance Document (**)
101.SCH	XBRL Taxonomy Extension Schema Document (**)
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document (**)
101.LAB	XBRL Taxonomy Extension Labels Linkbase Document (**)
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document (**)
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document (**)

(*)Filed herewith.

(**)Filed herewith electronically.

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EX-31.1

Exhibit 31.1

CERTIFICATIONS

I, Monte N. Redman, certify that:

1.	I have reviewed this Quarterly Report on Form 10-Q of Astoria Financial Corporation;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
	(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	(b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
	(c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
	(d)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.	The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
	(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
	(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:  November 6, 2013

/s/  Monte N. Redman

Monte N. Redman

President and Chief Executive Officer

Astoria Financial Corporation

EX-31.2

Exhibit 31.2

CERTIFICATIONS

I, Frank E. Fusco, certify that:

1.	I have reviewed this Quarterly Report on Form 10-Q of Astoria Financial Corporation;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
	(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	(b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
	(c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
	(d)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.	The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
	(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
	(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:  November 6, 2013

/s/ Frank E. Fusco

Frank E. Fusco

Senior Executive Vice President and Chief Financial Officer

Astoria Financial Corporation

EX-32.1

Exhibit 32.1

STATEMENT FURNISHED PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

This statement is being furnished in connection with the filing by Astoria Financial Corporation (the “Company”) of the Company’s Quarterly Report on Form 10-Q for the period ended September 30, 2013 (the “Report”).

By execution of this statement, the undersigned, Monte N. Redman, as President and Chief Executive Officer of the Company, and Frank E. Fusco, as Senior Executive Vice President and Chief Financial Officer of the Company, each hereby certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(A)the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m(a) or 78o(d)) and

(B)the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of the dates and for the periods covered by the Report.

November 6, 2013	/s/	Monte N. Redman
Dated		Monte N. Redman
		President and Chief Executive Officer
November 6, 2013	/s/	Frank E. Fusco
Dated		Frank E. Fusco
		Senior Executive Vice President and
		Chief Financial Officer

XML

Pension Plans and Other Postretirement Benefits

9 Months Ended

Sep. 30, 2013

Pension Plans and Other Postretirement Benefits

Pension Plans and Other Postretirement Benefits

9.     Pension Plans and Other Postretirement Benefits

The following tables set forth information regarding the components of net periodic cost for our defined benefit pension plans and other postretirement benefit plan for the periods indicated.

	Pension Benefits				Other Postretirement  Benefits
	For the Three Months Ended September 30,				For the Three Months Ended September 30,
(In Thousands)	2013		2012		2013	2012
Service cost	$       —		$        —		$      396	$    265
Interest cost	2,387		2,663		319	345
Expected return on plan assets	(3,188	)	(3,109	)	—	—
Recognized net actuarial loss	785		563		118	129
Amortization of prior service cost (credit)	53		56		—	(6	)
Net periodic cost	$       37		$      173		$      833	$    733

	Pension Benefits				Other Postretirement Benefits
	For the Nine Months Ended September 30,				For the Nine Months Ended September 30,
(In Thousands)	2013		2012		2013	2012
Service cost	$       —		$  2,025		$  1,185	$    796
Interest cost	7,162		8,327		959	1,034
Expected return on plan assets	(9,565	)	(8,837	)	—	—
Recognized net actuarial loss	2,354		4,366		354	387
Amortization of prior service cost (credit)	159		122		—	(18	)
Curtailment	—		7		—	—
Net periodic cost	$     110		$   6,010		$  2,498	$ 2,199

Effective April 30, 2012, the Astoria Federal Savings and Loan Association Employees’ Pension Plan, the Astoria Federal Savings and Loan Association Excess Benefit Plan, the Astoria Federal Savings and Loan Association Supplemental Benefit Plan and the Astoria Federal Savings and Loan Association Directors’ Retirement Plan were amended to, among other things, change the manner in which benefits were computed for service through April 30, 2012 and to suspend accrual of additional benefits for all of the aforementioned plans effective April 30, 2012.  These amendments resulted in a significant reduction in net periodic cost for our defined benefit pension plans for periods subsequent to April 30, 2012.

XML

Other Comprehensive Income/Loss (Details 3) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Amounts reclassified from accumulated other comprehensive loss to the consolidated statements of income
Reclassification adjustment for gain on sales of securities			$ (2,057)
Reclassification adjustment for net actuarial loss	903		2,708
Reclassification adjustment for prior service cost	53		159
Income before income tax expense	26,438	20,429	72,631	56,012
Income tax effect	(9,514)	(7,074)	(26,190)	(19,837)
Net income	16,924	13,355	46,441	36,175
Amount Reclassified from Accumulated Other Comprehensive Income
Amounts reclassified from accumulated other comprehensive loss to the consolidated statements of income
Income before income tax expense	(956)		(810)
Income tax effect	337		285
Net income	(619)		(525)
Gain on sales of securities | Amount Reclassified from Accumulated Other Comprehensive Income
Amounts reclassified from accumulated other comprehensive loss to the consolidated statements of income
Reclassification adjustment for gain on sales of securities			2,057
Compensation and benefits | Amount Reclassified from Accumulated Other Comprehensive Income
Amounts reclassified from accumulated other comprehensive loss to the consolidated statements of income
Reclassification adjustment for net actuarial loss	(903)		(2,708)
Reclassification adjustment for prior service cost	$ (53)		$ (159)

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Consolidated Statements of Income (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Interest income:
Residential mortgage loans	$ 69,158	$ 91,490	$ 222,994	$ 286,236
Multi-family and commercial real estate mortgage loans	41,450	38,127	120,463	111,088
Consumer and other loans	2,175	2,309	6,611	6,944
Mortgage-backed and other securities	13,247	14,453	36,003	49,445
Repurchase agreements and interest-earning cash accounts	67	182	192	282
Federal Home Loan Bank of New York stock	1,498	1,773	5,147	4,928
Total interest income	127,595	148,334	391,410	458,923
Interest expense:
Deposits	15,156	22,119	48,166	78,479
Borrowings	26,235	40,217	88,107	119,581
Total interest expense	41,391	62,336	136,273	198,060
Net interest income	86,204	85,998	255,137	260,863
Provision for loan losses	2,541	9,500	16,193	29,500
Net interest income after provision for loan losses	83,663	76,498	238,944	231,363
Non-interest income:
Customer service fees	9,550	10,487	27,718	30,480
Other loan fees	598	545	1,588	1,937
Gain on sales of securities			2,057	2,477
Mortgage banking income, net	1,888	2,015	10,060	5,147
Income from bank owned life insurance	1,972	2,446	6,211	7,073
Other	1,301	1,081	4,535	4,478
Total non-interest income	15,309	16,574	52,169	51,592
General and administrative:
Compensation and benefits	33,879	30,758	99,262	105,060
Occupancy, equipment and systems	17,022	16,758	53,669	49,992
Federal deposit insurance premiums	9,166	12,533	28,359	35,600
Advertising	2,074	1,811	6,225	5,624
Extinguishment of debt		1,212	4,266	1,212
Other	10,393	9,571	26,701	29,455
Total non-interest expense	72,534	72,643	218,482	226,943
Income before income tax expense	26,438	20,429	72,631	56,012
Income tax expense	9,514	7,074	26,190	19,837
Net income	16,924	13,355	46,441	36,175
Preferred stock dividends	2,194		5,021
Net income available to common shareholders	$ 14,730	$ 13,355	$ 41,420	$ 36,175
Basic earnings per common share (in dollars per share)	$ 0.15	$ 0.14	$ 0.42	$ 0.38
Diluted earnings per common share (in dollars per share)	$ 0.15	$ 0.14	$ 0.42	$ 0.38
Basic weighted average common shares outstanding (in shares)	97,199,329	95,555,816	96,967,052	95,303,453
Diluted weighted average common shares outstanding (in shares)	97,199,329	95,555,816	96,967,052	95,303,453

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Securities

9 Months Ended

Sep. 30, 2013

Securities

Securities

2.     Securities

The following tables set forth the amortized cost and estimated fair value of securities available-for-sale and held-to-maturity at the dates indicated.

	At September 30, 2013
(In Thousands)	AmortizedCost		GrossUnrealizedGains		GrossUnrealizedLosses			EstimatedFairValue
Available-for-sale:
Residential mortgage-backed securities:
GSE (1) issuance REMICs and CMOs (2)	$	300,047	$	2,310	$	(5,391	)	$	296,966
Non-GSE issuance REMICs and CMOs	8,330		67		(1		)	8,396
GSE pass-through certificates	17,150		810		(3		)	17,957
Total residential mortgage-backed securities	325,527		3,187		(5,395		)	323,319
Obligations of GSEs	98,674		—		(6,244		)	92,430
Fannie Mae stock	15		—		(14		)	1
Total securities available-for-sale	$	424,216	$	3,187	$	(11,653	)	$	415,750
Held-to-maturity:
Residential mortgage-backed securities:
GSE issuance REMICs and CMOs	$	1,534,021	$	16,264	$	(21,336	)	$	1,528,949
Non-GSE issuance REMICs and CMOs	4,054		69		(10		)	4,113
GSE pass-through certificates	288,655		884		(8,235		)	281,304
Total residential mortgage-backed securities	1,826,730		17,217		(29,581		)	1,814,366
Obligations of GSEs	88,127		—		(6,326		)	81,801
Other	604		—		—			604
Total securities held-to-maturity	$	1,915,461	$	17,217	$	(35,907	)	$	1,896,771

(1) Government-sponsored enterprise

(2) Real estate mortgage investment conduits and collateralized mortgage obligations

	At December 31, 2012
(In Thousands)	AmortizedCost		GrossUnrealizedGains		GrossUnrealizedLosses			EstimatedFairValue
Available-for-sale:
Residential mortgage-backed securities:
GSE issuance REMICs and CMOs	$	200,152	$	5,258	$	(583	)	$	204,827
Non-GSE issuance REMICs and CMOs	11,296		9		(86		)	11,219
GSE pass-through certificates	20,348		1,029		(2		)	21,375
Total residential mortgage-backed securities	231,796		6,296		(671		)	237,421
Obligations of GSEs	98,670		214		(5		)	98,879
Fannie Mae stock	15		—		(15		)	—
Total securities available-for-sale	$	330,481	$	6,510	$	(691	)	$	336,300
Held-to-maturity:
Residential mortgage-backed securities:
GSE issuance REMICs and CMOs	$	1,693,437	$	27,787	$	(2,955	)	$	1,718,269
Non-GSE issuance REMICs and CMOs	5,791		112		—			5,903
GSE pass-through certificates	257		6		(1		)	262
Total residential mortgage-backed securities	1,699,485		27,905		(2,956		)	1,724,434
Other	656		—		—			656
Total securities held-to-maturity	$	1,700,141	$	27,905	$	(2,956	)	$	1,725,090

The following tables set forth the estimated fair values of securities with gross unrealized losses at the dates indicated, segregated between securities that have been in a continuous unrealized loss position for less than twelve months and those that have been in a continuous unrealized loss position for twelve months or longer at the dates indicated.

	At September 30, 2013
	Less Than Twelve Months		Twelve Months or Longer		Total
(In Thousands)	EstimatedFair Value	GrossUnrealizedLosses	EstimatedFair Value	GrossUnrealizedLosses	EstimatedFair Value	GrossUnrealizedLosses
Available-for-sale:
GSE issuance REMICs and CMOs	$ 157,497	$   (5,193)	$ 17,296	$    (198)	$ 174,793	$   (5,391	)
Non-GSE issuance REMICs and CMOs	—	—	140	(1)	140	(1	)
GSE pass-through certificates	292	(1)	90	(2)	382	(3	)
Obligations of GSEs	92,430	(6,244)	—	—	92,430	(6,244	)
Fannie Mae stock	—	—	1	(14)	1	(14	)
Total temporarily impaired securities available-for-sale	$ 250,219	$ (11,438)	$ 17,527	$    (215)	$ 267,746	$ (11,653	)
Held-to-maturity:
GSE issuance REMICs and CMOs	$ 647,583	$ (17,525)	$ 78,148	$ (3,811)	$ 725,731	$ (21,336	)
Non-GSE issuance REMICs and CMOs	398	(10)	—	—	398	(10	)
GSE pass-through certificates	182,209	(8,234)	31	(1)	182,240	(8,235	)
Obligations of GSEs	81,801	(6,326)	—	—	81,801	(6,326	)
Total temporarily impaired securities held-to-maturity	$ 911,991	$ (32,095)	$ 78,179	$ (3,812)	$ 990,170	$ (35,907	)

	At December 31, 2012
	Less Than Twelve Months		Twelve Months or Longer		Total
(In Thousands)	EstimatedFair Value	GrossUnrealizedLosses	EstimatedFair Value	GrossUnrealizedLosses	EstimatedFair Value	GrossUnrealizedLosses
Available-for-sale:
GSE issuance REMICs and CMOs	$   67,841	$    (583)	$       —	$     —	$  67,841	$    (583	)
Non-GSE issuance REMICs and CMOs	—	—	10,709	(86)	10,709	(86	)
GSE pass-through certificates	57	(1)	47	(1)	104	(2	)
Obligations of GSEs	24,995	(5)	—	—	24,995	(5	)
Fannie Mae stock	—	—	—	(15)	—	(15	)
Total temporarily impaired securities available-for-sale	$   92,893	$    (589)	$ 10,756	$ (102)	$ 103,649	$    (691	)
Held-to-maturity:
GSE issuance REMICs and CMOs	$ 413,651	$ (2,759)	$ 12,259	$ (196)	$ 425,910	$ (2,955	)
GSE pass-through certificates	48	(1)	—	—	48	(1	)
Total temporarily impaired securities held-to-maturity	$ 413,699	$ (2,760)	$ 12,259	$ (196)	$ 425,958	$ (2,956	)

We held 91 securities which had an unrealized loss at September 30, 2013 and 41 at December 31, 2012.  At September 30, 2013 and December 31, 2012, substantially all of the securities in an unrealized loss position had a fixed interest rate and the cause of the temporary impairment was directly related to the change in interest rates.  We generally view changes in fair value caused by changes in interest rates as temporary, which is consistent with our experience.  None of the unrealized losses are related to credit losses.  Therefore, at September 30, 2013 and December 31, 2012, the impairments were deemed temporary based on (1) the direct relationship of the decline in fair value to movements in interest rates, (2) the estimated remaining life and high credit quality of the investments and (3) the fact that we had no intention to sell these securities and it was not more likely than not that we would be required to sell these securities before their anticipated recovery of the remaining amortized cost basis and we expected to recover the entire amortized cost basis of the security.

During the nine months ended September 30, 2013, proceeds from sales of securities from the available-for-sale portfolio totaled $41.6 million resulting in gross realized gains totaling $2.1 million.  During the nine months ended September 30, 2012, proceeds from sales of securities from the available-for-sale portfolio totaled $54.3 million, resulting in gross realized gains totaling $2.5 million.

At September 30, 2013, available-for-sale debt securities excluding mortgage-backed securities had an amortized cost of $98.7 million, a fair value of $92.4 million and contractual maturities in 2021 and 2022.  At September 30, 2013, held-to-maturity debt securities excluding mortgage-backed securities had an amortized cost of $88.7 million, a fair value of $82.4 million and contractual maturities in 2020 through 2023.  Actual maturities may differ from contractual maturities because issuers may have the right to prepay or call obligations with or without prepayment penalties.

At September 30, 2013, we held securities with an amortized cost of $186.8 million which are callable within one year and at various times thereafter.

The balance of accrued interest receivable for securities totaled $6.2 million at September 30, 2013 and $5.7 million at December 31, 2012.

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Earnings Per Common Share (Tables)

9 Months Ended

Sep. 30, 2013

Earnings Per Common Share

Reconciliation of basic and diluted earnings per common share

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
(In Thousands, Except Share Data)	2013		2012		2013		2012
Net income	$ 16,924		$ 13,355		$ 46,441		$ 36,175
Preferred stock dividends	(2,194	)	—		(5,021	)	—
Net income available to common shareholders	14,730		13,355		41,420		36,175
Income allocated to participating securities	(195	)	(206	)	(508	)	(250	)
Net income allocated to common shareholders	$ 14,535		$ 13,149		$ 40,912		$ 35,925
Basic weighted average common shares outstanding	97,199,329		95,555,816		96,967,052		95,303,453
Dilutive effect of stock options (1)	—		—		—		—
Diluted weighted average common shares outstanding	97,199,329		95,555,816		96,967,052		95,303,453
Basic EPS	$ 0.15		$ 0.14		$ 0.42		$ 0.38
Diluted EPS	$ 0.15		$ 0.14		$ 0.42		$ 0.38

(1) Excludes options to purchase 1,871,935 shares of common stock which were outstanding during the three months ended September 30, 2013; options to purchase 5,452,028 shares of common stock which were outstanding during the three months ended September 30, 2012; options to purchase 2,215,820 shares of common stock which were outstanding during the nine months ended September 30, 2013; and options to purchase 5,674,912 shares of common stock which were outstanding during the nine months ended September 30, 2012 because their inclusion would be anti-dilutive.

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Stock Incentive Plans (Details 2) (USD $)	9 Months Ended
	Sep. 30, 2013
Number of Shares
Nonvested at the beginning of the period (in shares)	1,146,657
Granted (in shares)	536,110
Vested (in shares)	(297,305)
Forfeited (in shares)	(90,306)
Nonvested at the end of the period (in shares)	1,295,156
Weighted-Average Grant Date Fair Value
Nonvested at the beginning of the period (in dollars per share)	$ 14.87
Granted (in dollars per share)	$ 9.70
Vested (in dollars per share)	$ (22.76)
Forfeited (in dollars per share)	$ (11.00)
Nonvested at the end of the period (in dollars per share)	$ 11.19

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Stock Incentive Plans

9 Months Ended

Sep. 30, 2013

Stock Incentive Plans

Stock Incentive Plans

10.    Stock Incentive Plans

During the nine months ended September 30, 2013, 494,420 shares of restricted common stock were granted to select officers under the 2005 Re-designated, Amended and Restated Stock Incentive Plan for Officers and Employees of Astoria Financial Corporation, or the 2005 Employee Stock Plan, of which 467,070 shares vest one-third per year on or about December 16, beginning December 16, 2013, 1,000 shares vest on December 16, 2013, 6,000 shares vest one-third per year on or about January 7, beginning January 7, 2014, 1,500 shares vest on December 15, 2014, 2,500 shares vest on December 14, 2015 and 16,350 were forfeited as of September 30, 2013.  In the event the grantee terminates his/her employment due to death or disability, or in the event we experience a change in control, as defined and specified in the 2005 Employee Stock Plan, all restricted common stock granted pursuant to such plan immediately vests.

During the nine months ended September 30, 2013, 41,690 shares of restricted common stock were granted to directors under the Astoria Financial Corporation 2007 Non-Employee Directors Stock Plan, as amended, of which 36,020 remain outstanding at September 30, 2013 and vest 100% in January 2016, although awards immediately vest upon death, disability, mandatory retirement, involuntary termination or a change in control, as such terms are defined in the plan.

The following table summarizes restricted common stock activity in our stock incentive plans for the nine months ended September 30, 2013.

	Number of Shares		Weighted Average Grant Date Fair Value
Nonvested at January 1, 2013	1,146,657		$  14.87
Granted	536,110		9.70
Vested	(297,305	)	(22.76	)
Forfeited	(90,306	)	(11.00	)
Nonvested at September 30, 2013	1,295,156		11.19

In addition to the activity described above, during the 2013 first quarter, 432,300 performance-based restricted stock units were granted to select officers under the 2005 Employee Stock Plan, with a grant date fair value of $9.22 per unit, of which 415,900 units remain outstanding at September 30, 2013.  Each restricted stock unit granted represents a right, under the 2005 Employee Stock Plan, to receive one share of our common stock in the future, subject to meeting certain criteria.  The restricted stock units have specified performance objectives within a specified performance measurement period and no voting or dividend rights prior to vesting and delivery of shares.  The performance measurement period for these restricted stock units is the fiscal year ending December 31, 2015 and the vest date is February 1, 2016.  Shares will be issued on the vest date at either 100%, 75%, 50% or 0% of units granted based on actual performance during the performance measurement period.  However, in the event of a change in control during the performance measurement period, the restricted stock units will vest on the change in control date and shares will be issued at 100% of units granted.  Absent a change in control, if a grantee’s employment terminates prior to December 31, 2015 all restricted stock units will be forfeited.  In the event the grantee terminates his/her employment during the period between December 31, 2015 and February 1, 2016 due to death, disability, retirement or a change in control, the grantee will remain entitled to the shares otherwise earned.

Stock-based compensation expense is recognized on a straight-line basis over the vesting period and totaled $1.2 million, net of taxes of $636,000, for the three months ended September 30, 2013 and $3.4 million, net of taxes of $1.9 million, for the nine months ended September 30, 2013.  Stock-based compensation expense totaled $978,000, net of taxes of $533,000, for the three months ended September 30, 2012 and $2.4 million, net of taxes of $1.3 million, for the nine months ended September 30, 2012.  At September 30, 2013, pre-tax compensation cost related to all nonvested awards of restricted common stock and restricted stock units not yet recognized totaled $12.0 million and will be recognized over a weighted average period of approximately 2.0 years, which excludes $1.8 million of pre-tax compensation cost related to 65,000 shares of performance-based restricted common stock granted in 2011 and 103,975 performance-based restricted stock units granted in 2013, for which compensation cost will begin to be recognized when the achievement of the performance conditions becomes probable.

As a result of the resignation and retirement of several executive officers during the 2012 first quarter, the level of forfeitures in 2012 significantly exceeded our original estimate of restricted common stock forfeitures based on our prior experience.  As a result, we reversed stock-based compensation expense during the 2012 first quarter totaling $569,000, net of taxes of $310,000, representing stock-based compensation expense previously recognized on unvested shares of restricted common stock which will not vest as a result of forfeitures.

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Borrowings (Details 4) (USD $) In Millions, unless otherwise specified	0 Months Ended	3 Months Ended
	May 10, 2013	Jun. 30, 2013
Junior Subordinated Debentures
Borrowings
Debt instrument, interest rate (as a percent)	9.75%
Aggregate principal amount	$ 128.9
Prepayment price for Junior Subordinated Debentures as a percentage of liquidation amount	103.413%
Debt prepayment, aggregate principal amount	128.9
Prepayment charge		4.3
Astoria Capital Trust I
Borrowings
Capital Securities, aggregate liquidation amount	125.0
Debt instrument, interest rate (as a percent)	9.75%
Common securities	$ 3.9

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Fair Value Measurements (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2013	Dec. 31, 2012
Fair Value of Financial Instruments
Total securities available-for-sale	$ 415,750	$ 336,300
Recurring basis
Fair Value of Financial Instruments
Total securities available-for-sale	415,750	336,300
Residential mortgage-backed securities
Fair Value of Financial Instruments
Total securities available-for-sale	323,319	237,421
Residential mortgage-backed securities | Recurring basis
Fair Value of Financial Instruments
Percentage of debt securities comprising available-for-sale portfolio	78.00%	71.00%
Available-for-sale residential mortgage-backed securities portfolio which are GSE securities (as a percent)	97.00%	95.00%
GSE issuance REMICs and CMOs
Fair Value of Financial Instruments
Total securities available-for-sale	296,966	204,827
GSE issuance REMICs and CMOs | Recurring basis
Fair Value of Financial Instruments
Total securities available-for-sale	296,966	204,827
Non-GSE issuance REMICs and CMOs
Fair Value of Financial Instruments
Total securities available-for-sale	8,396	11,219
Non-GSE issuance REMICs and CMOs | Recurring basis
Fair Value of Financial Instruments
Total securities available-for-sale	8,396	11,219
GSE pass-through certificates
Fair Value of Financial Instruments
Total securities available-for-sale	17,957	21,375
GSE pass-through certificates | Recurring basis
Fair Value of Financial Instruments
Total securities available-for-sale	17,957	21,375
Obligations of GSEs
Fair Value of Financial Instruments
Total securities available-for-sale	92,430	98,879
Obligations of GSEs | Recurring basis
Fair Value of Financial Instruments
Total securities available-for-sale	92,430	98,879
Percentage of debt securities comprising available-for-sale portfolio	22.00%	29.00%
Fannie Mae stock
Fair Value of Financial Instruments
Total securities available-for-sale	1
Fannie Mae stock | Recurring basis
Fair Value of Financial Instruments
Total securities available-for-sale	1
Level 1 | Recurring basis
Fair Value of Financial Instruments
Total securities available-for-sale	1
Level 1 | Fannie Mae stock | Recurring basis
Fair Value of Financial Instruments
Total securities available-for-sale	1
Level 2 | Recurring basis
Fair Value of Financial Instruments
Total securities available-for-sale	415,749	336,300
Level 2 | GSE issuance REMICs and CMOs | Recurring basis
Fair Value of Financial Instruments
Total securities available-for-sale	296,966	204,827
Level 2 | Non-GSE issuance REMICs and CMOs | Recurring basis
Fair Value of Financial Instruments
Total securities available-for-sale	8,396	11,219
Level 2 | GSE pass-through certificates | Recurring basis
Fair Value of Financial Instruments
Total securities available-for-sale	17,957	21,375
Level 2 | Obligations of GSEs | Recurring basis
Fair Value of Financial Instruments
Total securities available-for-sale	$ 92,430	$ 98,879

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Loans Receivable and Allowance for Loan Losses (Details 6) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2013	Dec. 31, 2012
Recorded Investment
Total	$ 12,483,497	$ 13,155,914
Past due 90 days or more	263,355	301,407
Mortgage Loans (Gross)
Recorded Investment
Total	12,239,352	12,891,820
Past due 90 days or more	256,881	294,899
Mortgage Loans (Gross) | Residential Mortgage Loans
Recorded Investment
Total	8,298,518	9,711,226
Past due 90 days or more	244,691	280,671
Mortgage Loans (Gross) | Residential Mortgage Loans | Full Documentation Interest-only Loans
Recorded Investment
Total	1,525,837	2,001,396
Past due 90 days or more	85,019	97,907
Mortgage Loans (Gross) | Residential Mortgage Loans | Full Documentation Amortizing Loans
Recorded Investment
Total	5,501,024	6,304,872
Past due 90 days or more	42,294	43,014
Mortgage Loans (Gross) | Residential Mortgage Loans | Reduced Documentation Interest-only Loans
Recorded Investment
Total	879,546	1,005,295
Past due 90 days or more	91,089	107,254
Mortgage Loans (Gross) | Residential Mortgage Loans | Reduced Documentation Amortizing Loans
Recorded Investment
Total	392,111	399,663
Past due 90 days or more	26,289	32,496
Consumer and Other Loans
Recorded Investment
Total	244,145	264,094
Past due 90 days or more	6,474	6,508
Consumer and Other Loans | Home equity lines of credit
Recorded Investment
Total	206,517	231,920
Past due 90 days or more	6,441	6,459
Consumer and Other Loans | Other Loans
Recorded Investment
Total	37,628	32,174
Past due 90 days or more	33	49
Performing | Mortgage Loans (Gross) | Residential Mortgage Loans | Full Documentation Interest-only Loans
Recorded Investment
Total	1,417,153	1,901,875
Performing | Mortgage Loans (Gross) | Residential Mortgage Loans | Full Documentation Amortizing Loans
Recorded Investment
Total	5,448,483	6,260,546
Performing | Mortgage Loans (Gross) | Residential Mortgage Loans | Reduced Documentation Interest-only Loans
Recorded Investment
Total	755,022	891,813
Performing | Mortgage Loans (Gross) | Residential Mortgage Loans | Reduced Documentation Amortizing Loans
Recorded Investment
Total	359,442	365,941
Performing | Consumer and Other Loans | Home equity lines of credit
Recorded Investment
Total	200,044	225,461
Performing | Consumer and Other Loans | Other Loans
Recorded Investment
Total	37,595	32,125
Non-performing | Mortgage Loans (Gross) | Residential Mortgage Loans | Full Documentation Interest-only Loans
Recorded Investment
Current or past due less than 90 days	23,665	1,614
Past due 90 days or more	85,019	97,907
Non-performing | Mortgage Loans (Gross) | Residential Mortgage Loans | Full Documentation Amortizing Loans
Recorded Investment
Current or past due less than 90 days	10,247	1,312
Past due 90 days or more	42,294	43,014
Non-performing | Mortgage Loans (Gross) | Residential Mortgage Loans | Reduced Documentation Interest-only Loans
Recorded Investment
Current or past due less than 90 days	33,435	6,228
Past due 90 days or more	91,089	107,254
Non-performing | Mortgage Loans (Gross) | Residential Mortgage Loans | Reduced Documentation Amortizing Loans
Recorded Investment
Current or past due less than 90 days	6,380	1,226
Past due 90 days or more	26,289	32,496
Non-performing | Consumer and Other Loans | Home equity lines of credit
Recorded Investment
Current or past due less than 90 days	32
Past due 90 days or more	6,441	6,459
Non-performing | Consumer and Other Loans | Other Loans
Recorded Investment
Past due 90 days or more	$ 33	$ 49

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Stock Incentive Plans (Tables)

9 Months Ended

Sep. 30, 2013

Stock Incentive Plans

Restricted Common Stock Activity in Stock Incentive Plans

	Number of Shares		Weighted Average Grant Date Fair Value
Nonvested at January 1, 2013	1,146,657		$  14.87
Granted	536,110		9.70
Vested	(297,305	)	(22.76	)
Forfeited	(90,306	)	(11.00	)
Nonvested at September 30, 2013	1,295,156		11.19

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Pension Plans and Other Postretirement Benefits (Tables)

9 Months Ended

Sep. 30, 2013

Pension Plans and Other Postretirement Benefits

Schedule of net periodic cost for defined benefit pension plans and other postretirement benefit plan

	Pension Benefits				Other Postretirement  Benefits
	For the Three Months Ended September 30,				For the Three Months Ended September 30,
(In Thousands)	2013		2012		2013	2012
Service cost	$       —		$        —		$      396	$    265
Interest cost	2,387		2,663		319	345
Expected return on plan assets	(3,188	)	(3,109	)	—	—
Recognized net actuarial loss	785		563		118	129
Amortization of prior service cost (credit)	53		56		—	(6	)
Net periodic cost	$       37		$      173		$      833	$    733

	Pension Benefits				Other Postretirement Benefits
	For the Nine Months Ended September 30,				For the Nine Months Ended September 30,
(In Thousands)	2013		2012		2013	2012
Service cost	$       —		$  2,025		$  1,185	$    796
Interest cost	7,162		8,327		959	1,034
Expected return on plan assets	(9,565	)	(8,837	)	—	—
Recognized net actuarial loss	2,354		4,366		354	387
Amortization of prior service cost (credit)	159		122		—	(18	)
Curtailment	—		7		—	—
Net periodic cost	$     110		$   6,010		$  2,498	$ 2,199

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Borrowings (Details 2) (USD $)	9 Months Ended
	Sep. 30, 2013	Dec. 31, 2012
Borrowings
Weighted Average Rate (as a percent)	2.46%	3.03%
Callable borrowings	$ 1,950,000,000	$ 1,950,000,000
Reverse repurchase agreements
Borrowings
Weighted Average Rate (as a percent)	3.87%	4.32%
Borrowings restructured with the counterparties	500,000,000
FHLB-NY advances | FHLB-NY
Borrowings
Weighted Average Rate (as a percent)	1.83%	2.07%
Borrowings restructured with the counterparties	850,000,000
Restructured Borrowings
Borrowings
Weighted Average Rate (as a percent)	3.46%
Borrowings restructured with the counterparties	1,350,000,000
Weighted average rate before restructuring of borrowings (as a percent)	4.40%
Weighted average remaining term before restructuring of borrowings	4 years
Weighted average remaining term	7 years
Restructured borrowings of which contractual call dates extended to 2017	950,000,000
Restructured borrowings of which contractual call dates extended to 2016	100,000,000
Restructured borrowings of which contractual call dates extended to 2015	$ 200,000,000

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Loans Receivable and Allowance for Loan Losses (Details 2) (USD $)	Sep. 30, 2013	Dec. 31, 2012
Loans receivable and allowance for loan losses disclosures
30-59 Days Past Due	$ 105,939,000	$ 146,782,000
60-89 Days Past Due	32,184,000	37,637,000
Current	12,082,019,000	12,670,088,000
Impaired loans	386,040,000	346,906,000
Bankruptcy loans | Non-performing
Loans receivable and allowance for loan losses disclosures
Loans which were current or less than 90 days past due	64,300,000
30-59 Days Past Due	5,900,000
60-89 Days Past Due	535,000
Current	57,800,000
Loans discharged prior to 2012 included in loans which are less than 90 days past due	49,900,000
Impaired loans	88,000,000
Loans discharged prior to 2012 included in impaired loans	$ 66,300,000

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Loans Receivable and Allowance for Loan Losses (Details 8) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2013	Jun. 30, 2013	Dec. 31, 2012	Sep. 30, 2012	Jun. 30, 2012	Dec. 31, 2011
Balances of our loans receivable and the related allowance for loan loss allocation by segment and by the impairment methodology followed in determining the allowance for loan losses
Loans individually evaluated for impairment	$ 386,040		$ 346,906
Loans collectively evaluated for impairment	12,097,457		12,809,008
Total loans	12,483,497		13,155,914
Loans individually evaluated for impairment, allowance for loan losses	24,766		5,046
Loans collectively evaluated for impairment, allowance for loan losses	118,234		140,455
Total allowance for loan losses	143,000	143,900	145,501	148,472	148,102	157,185
Mortgage Loans (Gross)
Balances of our loans receivable and the related allowance for loan loss allocation by segment and by the impairment methodology followed in determining the allowance for loan losses
Total loans	12,239,352		12,891,820
Mortgage Loans (Gross) | Residential
Balances of our loans receivable and the related allowance for loan loss allocation by segment and by the impairment methodology followed in determining the allowance for loan losses
Loans individually evaluated for impairment	313,495		272,146
Loans collectively evaluated for impairment	7,985,023		9,439,080
Total loans	8,298,518		9,711,226
Loans individually evaluated for impairment, allowance for loan losses	22,265		1,001
Loans collectively evaluated for impairment, allowance for loan losses	61,159		88,266
Total allowance for loan losses	83,424	78,788	89,267	90,764	87,394	105,991
Mortgage Loans (Gross) | Multi-Family
Balances of our loans receivable and the related allowance for loan loss allocation by segment and by the impairment methodology followed in determining the allowance for loan losses
Loans individually evaluated for impairment	55,391		56,116
Loans collectively evaluated for impairment	3,062,623		2,350,562
Total loans	3,118,014		2,406,678
Loans individually evaluated for impairment, allowance for loan losses	2,179		2,576
Loans collectively evaluated for impairment, allowance for loan losses	36,066		32,938
Total allowance for loan losses	38,245	40,865	35,514	40,863	48,142	35,422
Mortgage Loans (Gross) | Commercial Real Estate
Balances of our loans receivable and the related allowance for loan loss allocation by segment and by the impairment methodology followed in determining the allowance for loan losses
Loans individually evaluated for impairment	17,154		18,644
Loans collectively evaluated for impairment	805,666		755,272
Total loans	822,820		773,916
Loans individually evaluated for impairment, allowance for loan losses	322		1,469
Loans collectively evaluated for impairment, allowance for loan losses	13,682		12,935
Total allowance for loan losses	14,004	16,642	14,404	11,558	9,109	11,972
Consumer and Other Loans
Balances of our loans receivable and the related allowance for loan loss allocation by segment and by the impairment methodology followed in determining the allowance for loan losses
Loans collectively evaluated for impairment	244,145		264,094
Total loans	244,145		264,094
Loans collectively evaluated for impairment, allowance for loan losses	7,327		6,316
Total allowance for loan losses	$ 7,327	$ 7,605	$ 6,316	$ 5,287	$ 3,457	$ 3,800

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Preferred Stock (Details) (USD $) In Thousands, except Share data, unless otherwise specified	9 Months Ended		0 Months Ended
	Sep. 30, 2013	Dec. 31, 2012	Sep. 18, 2013 Series C Preferred Stock	Jun. 19, 2013 Series C Preferred Stock	Mar. 19, 2013 Series C Preferred Stock	Mar. 19, 2013 Depositary share
Preferred Stock
Shares issued (in shares)					135,000	5,400,000
Per share interest in Non-Cumulative Perpetual Preferred Stock, Series C						0.025
Dividend rate (as a percent)					6.50%
Par value (in dollars per share)	$ 1.00	$ 1.00
Liquidation preference (in dollars per share)					$ 1,000	$ 25
Aggregate proceeds from the offering, net of underwriting discounts and other issuance costs	$ 129,796				$ 129,800
Redemption price (in dollars per share)					$ 1,000	$ 25
Dividends on preferred stock	$ 5,021		$ 2,200	$ 2,800
Dividends declared on preferred stock (in dollars per share)	$ 37.19		$ 16.25	$ 20.94

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Securities (Details 3) (USD $)	9 Months Ended
	Sep. 30, 2013 item	Sep. 30, 2012	Dec. 31, 2012 item
Securities
Number of securities held with unrealized loss	91		41
Proceeds from sales of securities available-for-sale	$ 41,640,000	$ 54,318,000
Gross realized gains from sale of available for sale securities	2,057,000	2,477,000
Total available-for-sale securities	415,750,000		336,300,000
Held-to-maturity, amortized cost	1,915,461,000		1,700,141,000
Held-to-maturity, Estimated fair value	1,896,771,000		1,725,090,000
Callable securities, amortized cost	186,800,000
Accrued interest receivable for securities	6,200,000		5,700,000
Held-to-maturity debt securities, excluding mortgage-backed securities
Securities
Held-to-maturity, amortized cost	88,700,000
Held-to-maturity, Estimated fair value	82,400,000
Available-for-sale debt securities, excluding mortgage-backed securities
Securities
Available-for-sale debt securities, amortized cost	98,700,000
Total available-for-sale securities	$ 92,400,000

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Loans Receivable and Allowance for Loan Losses (Details 11) (Mortgage Loans (Gross), USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013 item	Sep. 30, 2012 item	Sep. 30, 2013 item	Sep. 30, 2012 item
Information about mortgage loans receivable by segment and class modified in troubled debt restructuring
Number of Loans	29	13	75	44
Pre-Modification Recorded Investment	$ 16,238	$ 7,290	$ 34,862	$ 48,844
Recorded Investment	15,002	7,155	32,941	44,666
Residential Mortgage Loans | Full documentation interest-only loans
Information about mortgage loans receivable by segment and class modified in troubled debt restructuring
Number of Loans	7	2	18	6
Pre-Modification Recorded Investment	2,128	355	4,579	1,415
Recorded Investment	2,127	354	4,577	1,384
Residential Mortgage Loans | Full documentation amortizing loans
Information about mortgage loans receivable by segment and class modified in troubled debt restructuring
Number of Loans	1	3	6	3
Pre-Modification Recorded Investment	161	805	1,662	805
Recorded Investment	161	786	1,682	786
Residential Mortgage Loans | Reduced documentation interest-only loans
Information about mortgage loans receivable by segment and class modified in troubled debt restructuring
Number of Loans	10	5	28	12
Pre-Modification Recorded Investment	3,107	2,693	8,957	5,422
Recorded Investment	3,096	2,690	8,921	5,407
Residential Mortgage Loans | Reduced documentation amortizing loans
Information about mortgage loans receivable by segment and class modified in troubled debt restructuring
Number of Loans	2		8	5
Pre-Modification Recorded Investment	387		2,470	1,950
Recorded Investment	386		2,408	1,840
Multi-Family
Information about mortgage loans receivable by segment and class modified in troubled debt restructuring
Number of Loans	5		8	12
Pre-Modification Recorded Investment	3,967		6,751	31,581
Recorded Investment	3,774		6,228	29,129
Commercial Real Estate
Information about mortgage loans receivable by segment and class modified in troubled debt restructuring
Number of Loans	4	3	7	6
Pre-Modification Recorded Investment	6,488	3,437	10,443	7,671
Recorded Investment	$ 5,458	$ 3,325	$ 9,125	$ 6,120

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Other Comprehensive Income/Loss (Tables)

9 Months Ended

Sep. 30, 2013

Other Comprehensive Income/Loss

Components of and Changes in Accumulated Other Comprehensive Loss

(In Thousands)	At June 30, 2013		Other Comprehensive (Loss) Income		At September 30, 2013
Net unrealized loss on securities available-for-sale	$     (484	)	$ (1,286	)	$  (1,770	)
Net actuarial loss on pension plans and other postretirement benefits	(75,946	)	585		(75,361	)
Prior service cost on pension plans and other postretirement benefits	(3,357	)	34		(3,323	)
Accumulated other comprehensive loss	$(79,787	)	$    (667	)	$(80,454	)

(In Thousands)	At December 31, 2012		Other Comprehensive (Loss) Income		At September 30, 2013
Net unrealized gain (loss) on securities available-for-sale	$   7,451		$  (9,221	)	$   (1,770	)
Net actuarial loss on pension plans and other postretirement benefits	(77,115	)	1,754		(75,361	)
Prior service cost on pension plans and other postretirement benefits	(3,426	)	103		(3,323	)
Accumulated other comprehensive loss	$(73,090	)	$  (7,364	)	$ (80,454	)

Schedule of components of other comprehensive loss

	For the Three Months Ended September 30, 2013
(In Thousands)	Before Tax Amount		Tax Benefit (Expense)		After Tax Amount
Net unrealized holding loss on securities available-for-sale arising during the period	$   (1,984	)	$   698		$  (1,286	)
Reclassification adjustment for net actuarial loss included in net income	903		(318	)	585
Reclassification adjustment for prior service cost included in net income	53		(19	)	34
Other comprehensive loss	$   (1,028	)	$   361		$     (667	)

	For the Nine Months Ended September 30, 2013
(In Thousands)	Before Tax Amount		Tax Benefit (Expense)		After Tax Amount
Net unrealized loss on securities available-for-sale:
Net unrealized holding loss on securities arising during the period	$  (12,180	)	$  4,291		$  (7,889	)
Reclassification adjustment for gain on sales of securities included in net income	(2,057	)	725		(1,332	)
Net unrealized loss on securities available-for-sale	(14,237	)	5,016		(9,221	)
Reclassification adjustment for net actuarial loss included in net income	2,708		(954	)	1,754
Reclassification adjustment for prior service cost included in net income	159		(56	)	103
Other comprehensive loss	$  (11,370	)	$  4,006		$  (7,364	)

Information about amounts reclassified from accumulated other comprehensive loss to the consolidated statements of income

(In Thousands)	For the Three Months Ended September 30, 2013		For the Nine Months Ended September 30, 2013		Income Statement Line Item
Reclassification adjustment for gain on sales of securities	$     —		$  2,057		Gain on sales of securities
Reclassification adjustment for net actuarial loss (1)	(903	)	(2,708	)	Compensation and benefits
Reclassification adjustment for prior service cost (1)	(53	)	(159	)	Compensation and benefits
Total reclassifications, before tax	(956	)	(810	)
Income tax effect	337		285		Income tax expense
Total reclassifications, net of tax	$  (619	)	$    (525	)	Net income

(1) These other comprehensive loss components are included in the computations of net periodic cost for our defined benefit pension plans and other postretirement benefit plan.  See Note 9 for additional details.

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Consolidated Statement of Changes in Stockholders' Equity (USD $) In Thousands, unless otherwise specified	Total	Preferred Stock	Common Stock	Additional Paid-in Capital	Retained Earnings	Treasury Stock	Accumulated Other Comprehensive Loss	Unallocated Common Stock Held by ESOP
Balance at Dec. 31, 2012	$ 1,293,989		$ 1,665	$ 884,689	$ 1,891,022	$ (1,406,755)	$ (73,090)	$ (3,542)
Increase (Decrease) in Stockholders' Equity
Net income	46,441				46,441
Other comprehensive loss, net of tax	(7,364)						(7,364)
Issuance of Preferred Stock, Series C (135,000 shares)	129,796	129,796
Dividends on common stock ($0.12 per share)	(11,750)				(11,750)
Dividends on preferred stock ($37.19 per share)	(5,021)				(5,021)
Restricted stock grants (536,110 shares)				(5,200)	(5,878)	11,078
Forfeitures of restricted stock (90,306 shares)				994	872	(1,866)
Stock-based compensation	5,272			5,222	50
Net tax benefit shortfall from stock-based compensation	(1,296)			(1,296)
Allocation of ESOP stock	7,849			5,137				2,712
Balance at Sep. 30, 2013	$ 1,457,916	$ 129,796	$ 1,665	$ 889,546	$ 1,915,736	$ (1,397,543)	$ (80,454)	$ (830)

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Consolidated Statements of Cash Flows (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012
Cash flows from operating activities:
Net income	$ 46,441	$ 36,175
Adjustments to reconcile net income to net cash provided by operating activities:
Net amortization on loans	16,966	20,081
Net amortization on securities and borrowings	13,084	11,919
Net provision for loan and real estate losses	17,135	31,995
Depreciation and amortization	8,653	8,906
Net gain on sales of loans and securities	(8,595)	(9,874)
Net (gain) loss on dispositions of premises and equipment	(4)	62
Other asset impairment charges	89	457
Originations of loans held-for-sale	(229,041)	(268,766)
Proceeds from sales and principal repayments of loans held-for-sale	295,076	264,432
Stock-based compensation and allocation of ESOP stock	13,121	10,771
Decrease in accrued interest receivable	2,038	180
Mortgage servicing rights amortization and valuation allowance adjustments, net	(512)	3,996
Bank owned life insurance income and insurance proceeds received, net	(3,027)	(6,152)
Decrease in other assets	31,534	76,824
(Decrease) increase in accrued expenses and other liabilities	(13,902)	6,743
Net cash provided by operating activities	189,056	187,749
Cash flows from investing activities:
Originations of loans receivable	(1,782,858)	(2,741,316)
Loan purchases through third parties	(348,550)	(850,905)
Principal payments on loans receivable	2,724,868	3,212,449
Proceeds from sales of delinquent and non-performing loans	18,501	21,631
Purchases of securities held-to-maturity	(828,835)	(533,031)
Purchases of securities available-for-sale	(221,080)	(208,195)
Principal payments on securities held-to-maturity	602,321	699,899
Principal payments on securities available-for-sale	86,270	166,554
Proceeds from sales of securities available-for-sale	41,640	54,318
Net redemptions (purchases) of Federal Home Loan Bank of New York stock	17,977	(50,165)
Redemption of Astoria Capital Trust I common securities	3,866
Proceeds from sales of real estate owned, net	29,560	48,235
Purchases of premises and equipment	(6,142)	(5,899)
Proceeds from sales of premises and equipment	50
Net cash provided by (used in) investing activities	337,588	(186,425)
Cash flows from financing activities:
Net decrease in deposits	(383,584)	(706,732)
Net increase in borrowings with original terms of three months or less	189,000	684,000
Proceeds from borrowings with original terms greater than three months		950,000
Repayments of borrowings with original terms greater than three months	(453,866)	(944,000)
Cash payments for debt issuance costs		(2,643)
Net increase in mortgage escrow funds	24,147	21,236
Proceeds from issuance of preferred stock	135,000
Cash payments for preferred stock issuance costs	(5,204)
Cash dividends paid to stockholders	(14,577)	(20,249)
Net tax benefit shortfall from stock-based compensation	(1,296)	(2,067)
Net cash used in financing activities	(510,380)	(20,455)
Net increase (decrease) in cash and cash equivalents	16,264	(19,131)
Cash and cash equivalents at beginning of period	121,473	132,704
Cash and cash equivalents at end of period	137,737	113,573
Supplemental disclosures:
Interest paid	137,551	197,198
Income taxes paid	13,455	5,524
Additions to real estate owned	36,962	33,496
Loans transferred to held-for-sale	$ 15,642	$ 1,982

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Loans Held-for-Sale

9 Months Ended

Sep. 30, 2013

Loans Held-for-Sale

Loans Held-for-Sale

3.     Loans Held-for-Sale

Loans held-for-sale, net, includes fifteen and thirty year fixed rate one-to-four family, or residential, mortgage loans originated for sale that conform to GSE guidelines (conforming loans), as well as certain delinquent and non-performing loans.  Upon our decision to sell certain delinquent and non-performing loans held in portfolio, we reclassify them to held-for-sale at the lower of cost or fair value, less estimated selling costs.  Non-performing loans held-for-sale included in loans held-for-sale, net of valuation allowances, totaled $884,000 at September 30, 2013 and $3.9 million at December 31, 2012.  Non-performing loans held-for-sale were comprised primarily of multi-family mortgage loans at September 30, 2013.  Substantially all of the non-performing loans held-for-sale were multi-family mortgage loans at December 31, 2012.

We sold certain delinquent and non-performing mortgage loans, primarily multi-family and commercial real estate loans, totaling $18.4 million, net of charge-offs of $4.3 million, during the nine months ended September 30, 2013 and $20.4 million, net of charge-offs of $11.0 million, during the nine months ended September 30, 2012.  Net gain on sales of non-performing loans totaled $56,000 for the three months ended September 30, 2013 and $118,000 for the nine months ended September 30, 2013.  Net loss on sales of non-performing loans totaled $2,000 for the three months ended September 30, 2012 and net gain on sales of non-performing loans totaled $1.3 million for the nine months ended September 30, 2012.

We recorded net lower of cost or market write-downs on non-performing loans held-for-sale totaling $54,000 for the three months ended September 30, 2013 and $89,000 for the nine months ended September 30, 2013.  Net lower of cost or market write-downs on non-performing loans held-for-sale totaled $234,000 for the three months ended September 30, 2012 and $457,000 for the nine months ended September 30, 2012.  Lower of cost or market write-downs and recoveries on non-performing loans held-for-sale and gains and losses recognized on sales of such loans are included in other non-interest income in the consolidated statements of income.

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Basis of Presentation

9 Months Ended

Sep. 30, 2013

Basis of Presentation

Basis of Presentation

1. Basis of Presentation

The accompanying consolidated financial statements include the accounts of Astoria Financial Corporation and its wholly-owned subsidiaries: Astoria Federal Savings and Loan Association and its subsidiaries, referred to as Astoria Federal, and AF Insurance Agency, Inc.  As used in this quarterly report, “we,” “us” and “our” refer to Astoria Financial Corporation and its consolidated subsidiaries.  All significant inter-company accounts and transactions have been eliminated in consolidation.

In addition to Astoria Federal and AF Insurance Agency, Inc., we had another subsidiary, Astoria Capital Trust I, which was not consolidated with Astoria Financial Corporation for financial reporting purposes.  On May 14, 2013, we filed a Certificate of Cancellation of Certificate of Trust of Astoria Capital Trust I with the Delaware Secretary of State.  See Note 5 for further discussion of Astoria Capital Trust I.

In our opinion, the accompanying consolidated financial statements contain all adjustments (consisting only of normal recurring adjustments) necessary for a fair presentation of our financial condition as of September 30, 2013 and December 31, 2012, our results of operations and other comprehensive income/loss for the three and nine months ended September 30, 2013 and 2012, changes in our stockholders’ equity for the nine months ended September 30, 2013 and our cash flows for the nine months ended September 30, 2013 and 2012.  In preparing the consolidated financial statements, we are required to make estimates and assumptions that affect the reported amounts of assets and liabilities for the consolidated statements of financial condition as of September 30, 2013 and December 31, 2012, and amounts of revenues, expenses and other comprehensive income/loss in the consolidated statements of income and comprehensive income for the three and nine months ended September 30, 2013 and 2012.  The results of operations and other comprehensive income/loss for the three and nine months ended September 30, 2013 are not necessarily indicative of the results of operations and other comprehensive income/loss to be expected for the remainder of the year.  Certain information and note disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles, or GAAP, have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission, or SEC.  Certain reclassifications have been made to prior year amounts to conform to the current year presentation.

These consolidated financial statements should be read in conjunction with our December 31, 2012 audited consolidated financial statements and related notes included in our 2012 Annual Report on Form 10-K.

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Loans Receivable and Allowance for Loan Losses (Details 9) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2013	Dec. 31, 2012
Financing Receivable, Impaired
Unpaid Principal Balance	$ 486,261	$ 457,440
Recorded Investment	386,040	346,906
Related Allowance	(24,766)	(5,046)
Net Investment	361,274	341,860
Residential | Full documentation interest-only loans
Financing Receivable, Impaired
Unpaid Principal Balance, Loans with an allowance recorded	149,386	10,740
Unpaid Principal Balance, Loans without an allowance recorded		122,275
Recorded Investment, Loans with an allowance recorded	114,923	10,740
Recorded Investment, Loans without an allowance recorded		86,607
Related Allowance	(7,797)	(241)
Net Investment, Loans with an allowance recorded	107,126	10,499
Net Investment, Loans without an allowance recorded		86,607
Residential | Full documentation amortizing loans
Financing Receivable, Impaired
Unpaid Principal Balance, Loans with an allowance recorded	40,794	6,122
Unpaid Principal Balance, Loans without an allowance recorded		23,489
Recorded Investment, Loans with an allowance recorded	35,014	6,122
Recorded Investment, Loans without an allowance recorded		17,962
Related Allowance	(2,550)	(347)
Net Investment, Loans with an allowance recorded	32,464	5,775
Net Investment, Loans without an allowance recorded		17,962
Residential | Reduced documentation interest-only loans
Financing Receivable, Impaired
Unpaid Principal Balance, Loans with an allowance recorded	183,353	12,893
Unpaid Principal Balance, Loans without an allowance recorded		166,477
Recorded Investment, Loans with an allowance recorded	139,472	12,893
Recorded Investment, Loans without an allowance recorded		116,514
Related Allowance	(9,564)	(277)
Net Investment, Loans with an allowance recorded	129,908	12,616
Net Investment, Loans without an allowance recorded		116,514
Residential | Reduced documentation amortizing loans
Financing Receivable, Impaired
Unpaid Principal Balance, Loans with an allowance recorded	29,062	3,889
Unpaid Principal Balance, Loans without an allowance recorded		23,419
Recorded Investment, Loans with an allowance recorded	24,086	3,889
Recorded Investment, Loans without an allowance recorded		17,419
Related Allowance	(2,354)	(136)
Net Investment, Loans with an allowance recorded	21,732	3,753
Net Investment, Loans without an allowance recorded		17,419
Multi-Family
Financing Receivable, Impaired
Unpaid Principal Balance, Loans with an allowance recorded	23,437	19,704
Unpaid Principal Balance, Loans without an allowance recorded	38,635	44,341
Recorded Investment, Loans with an allowance recorded	23,437	19,704
Recorded Investment, Loans without an allowance recorded	31,954	36,412
Related Allowance	(2,179)	(2,576)
Net Investment, Loans with an allowance recorded	21,258	17,128
Net Investment, Loans without an allowance recorded	31,954	36,412
Commercial Real Estate
Financing Receivable, Impaired
Unpaid Principal Balance, Loans with an allowance recorded	6,764	10,835
Unpaid Principal Balance, Loans without an allowance recorded	14,830	13,256
Recorded Investment, Loans with an allowance recorded	6,764	10,835
Recorded Investment, Loans without an allowance recorded	10,390	7,809
Related Allowance	(322)	(1,469)
Net Investment, Loans with an allowance recorded	6,442	9,366
Net Investment, Loans without an allowance recorded	$ 10,390	$ 7,809

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Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2013

Fair Value Measurements

Schedule of carrying values of assets measured at fair value on recurring basis and level within the fair value hierarchy

	Carrying Value at September 30, 2013
(In Thousands)	Total	Level 1		Level 2
Securities available-for-sale:
Residential mortgage-backed securities:
GSE issuance REMICs and CMOs	$  296,966	$	—	$  296,966
Non-GSE issuance REMICs and CMOs	8,396	—		8,396
GSE pass-through certificates	17,957	—		17,957
Obligations of GSEs	92,430	—		92,430
Fannie Mae stock	1	1		—
Total securities available-for-sale	$  415,750	$	1	$  415,749

	Carrying Value at December 31, 2012
(In Thousands)	Total	Level 1		Level 2
Securities available-for-sale:
Residential mortgage-backed securities:
GSE issuance REMICs and CMOs	$  204,827	$	—	$  204,827
Non-GSE issuance REMICs and CMOs	11,219	—		11,219
GSE pass-through certificates	21,375	—		21,375
Obligations of GSEs	98,879	—		98,879
Fannie Mae stock	—	—		—
Total securities available-for-sale	$  336,300	$	—	$  336,300

Schedule of carrying values of assets measured at fair value on non-recurring basis which fall within Level 3 of the fair value hierarchy

	Carrying Value
(In Thousands)	At September 30, 2013	At December 31, 2012
Non-performing loans held-for-sale, net	$        884	$     3,881
Impaired loans	265,698	282,723
MSR, net	10,835	6,947
REO, net	20,903	20,796
Total	$ 298,320	$ 314,347

Schedule of losses recognized on assets measured at fair value on non-recurring basis

	For the Nine Months Ended September 30,
(In Thousands)	2013	2012
Non-performing loans held-for-sale, net (1)	$     567	$     696
Impaired loans (2)	16,698	31,555
MSR, net (3)	—	1,089
REO, net (4)	2,630	3,093
Total	$  19,895	$  36,433

(1)	Losses are charged against the allowance for loan losses in the case of a write-down upon the reclassification of a loan to held-for-sale. Losses subsequent to the reclassification of a loan to held-for-sale are charged to other non-interest income.
(2)	Losses are charged against the allowance for loan losses.
(3)	Losses are charged to mortgage banking income, net.
(4)	Losses are charged against the allowance for loan losses in the case of a write-down upon the transfer of a loan to REO. Losses subsequent to the transfer of a loan to REO are charged to REO expense which is a component of other non-interest expense.

Schedule of carrying values and estimated fair values of financial instruments

	At September 30, 2013
	Carrying		Estimated Fair Value
(In Thousands)	Value		Total		Level 2		Level 3
Financial Assets:
Securities held-to-maturity	$	1,915,461	$	1,896,771	$	1,896,771	$	—
FHLB-NY stock	153,217		153,217		153,217		—
Loans held-for-sale, net (1)	10,485		10,866		—		10,866
Loans receivable, net (1)	12,398,543		12,630,027		—		12,630,027
MSR, net (1)	10,835		10,838		—		10,838
Financial Liabilities:
Deposits	10,060,374		10,140,390		10,140,390		—
Borrowings, net	4,109,028		4,374,578		4,374,578		—

(1) Includes assets measured at fair value on a non-recurring basis.

	At December 31, 2012
	Carrying		Estimated Fair Value
(In Thousands)	Value		Total		Level 2		Level 3
Financial Assets:
Securities held-to-maturity	$	1,700,141	$	1,725,090	$	1,725,090	$	—
FHLB-NY stock	171,194		171,194		171,194		—
Loans held-for-sale, net (1)	76,306		78,486		—		78,486
Loans receivable, net (1)	13,078,471		13,311,997		—		13,311,997
MSR, net (1)	6,947		6,948		—		6,948
Financial Liabilities:
Deposits	10,443,958		10,588,073		10,588,073		—
Borrowings, net	4,373,496		4,857,989		4,857,989		—

(1) Includes assets measured at fair value on a non-recurring basis.

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Loans Held-for-Sale (Details) (USD $)	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012	Dec. 31, 2012
Loans held-for-sale, net	$ 10,485,000		$ 10,485,000		$ 76,306,000
Net lower of cost or market write-downs			89,000	457,000
Mortgage loans held-for-sale | Low end of the range
Mortgage loan, original term			15 years
Mortgage loans held-for-sale | High end of the range
Mortgage loan, original term			30 years
Non-performing loans held-for-sale, net
Loans held-for-sale, net	884,000		884,000		3,900,000
Sale of delinquent and non-performing mortgage loans, net of charge-offs, amount			18,400,000	20,400,000
Charge-offs on delinquent and non-performing mortgage loans sold			4,300,000	11,000,000
Net gain (loss) on sales of loans	56,000	(2,000)	118,000	1,300,000
Net lower of cost or market write-downs	$ 54,000	$ 234,000	$ 89,000	$ 457,000

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Loans Receivable and Allowance for Loan Losses (Details 5) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2013	Dec. 31, 2012
Recorded Investment
Total loans	$ 12,483,497	$ 13,155,914
Residential Mortgage Loans | Interest-only loans
Recorded Investment
Within one year	229,445
More than one year to three years	1,334,544
More than three years to five years	769,974
Over five years	71,420
Total loans	$ 2,405,383

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Stock Incentive Plans (Details) (USD $)	9 Months Ended		3 Months Ended			9 Months Ended														12 Months Ended	3 Months Ended	9 Months Ended
	Sep. 30, 2013	Dec. 31, 2012	Sep. 30, 2013 Restricted common stock	Sep. 30, 2012 Restricted common stock	Mar. 31, 2012 Restricted common stock	Sep. 30, 2013 Restricted common stock	Sep. 30, 2012 Restricted common stock	Sep. 30, 2013 Performance-based restricted stock awards or units Officers Vest on February 1, 2016, performance level one	Sep. 30, 2013 Performance-based restricted stock awards or units Officers Vest on February 1, 2016, performance level one Change in control	Sep. 30, 2013 Performance-based restricted stock awards or units Officers Vest on February 1, 2016, performance level two	Sep. 30, 2013 Performance-based restricted stock awards or units Officers Vest on February 1, 2016, performance level three	Sep. 30, 2013 Performance-based restricted stock awards or units Officers Vest on February 1, 2016, performance level four	Sep. 30, 2013 Employee Stock Plan, 2005 Plan Vesting in December 2013	Sep. 30, 2013 Employee Stock Plan, 2005 Plan Vesting in December 2014	Sep. 30, 2013 Employee Stock Plan, 2005 Plan Vesting in December 2015	Sep. 30, 2013 Employee Stock Plan, 2005 Plan Restricted common stock	Sep. 30, 2013 Employee Stock Plan, 2005 Plan Restricted common stock Shares vesting one-third per year beginning in December 2013	Sep. 30, 2013 Employee Stock Plan, 2005 Plan Restricted common stock Shares vesting one-third per year beginning in January 2014	Sep. 30, 2013 Employee Stock Plan, 2005 Plan Performance-based restricted stock awards or units	Dec. 31, 2011 Employee Stock Plan, 2005 Plan Performance-based restricted stock awards or units	Mar. 31, 2013 Employee Stock Plan, 2005 Plan Performance-based restricted stock awards or units Officers	Sep. 30, 2013 Employee Stock Plan, 2005 Plan Performance-based restricted stock awards or units Officers	Sep. 30, 2013 Directors Stock Plan, 2007 Plan Restricted common stock	Sep. 30, 2013 Directors Stock Plan, 2007 Plan Restricted common stock Vesting in January 2016
Stock Incentive Plans
Restricted common stock granted (in shares)	536,110												1,000	1,500	2,500	494,420	467,070	6,000	103,975	65,000	432,300		41,690
Vesting percentage																	33.00%	33.00%						100.00%
Stock-based compensation expense, net of taxes			$ 1,200,000	$ 978,000		$ 3,400,000	$ 2,400,000
Stock-based compensation expense, taxes			636,000	533,000		1,900,000	1,300,000
Pre-tax compensation cost related to non-vested restricted stock awards not yet recognized			12,000,000			12,000,000
Pre-tax compensation cost related to non-vested performance-based stock awards and units			1,800,000			1,800,000
Pre-tax compensation cost related to restricted stock awards, weighted average recognition period						2 years
Restricted stock, shares forfeited	90,306															16,350
Awards outstanding (in shares)	1,295,156	1,146,657																				415,900	36,020
Granted (in dollars per share)	$ 9.70																				$ 9.22
Share of common stock to be paid for each restricted stock unit																						1
Shares to be issued on vest date as percentage of units granted based on actual performance								100.00%		75.00%	50.00%	0.00%
Shares to be issued on vesting date as a percentage of units granted in the event of change in control									100.00%
Stock-based compensation expense reversed					569,000
Stock-based compensation expense, taxes reversed					$ 310,000

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Earnings Per Common Share (Details) (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Earnings Per Common Share
Net income	$ 16,924	$ 13,355	$ 46,441	$ 36,175
Preferred stock dividends	(2,194)		(5,021)
Net income available to common shareholders	14,730	13,355	41,420	36,175
Income allocated to participating securities	(195)	(206)	(508)	(250)
Net income allocated to common shareholders	$ 14,535	$ 13,149	$ 40,912	$ 35,925
Basic weighted average common shares outstanding	97,199,329	95,555,816	96,967,052	95,303,453
Diluted weighted average common shares outstanding	97,199,329	95,555,816	96,967,052	95,303,453
Basic EPS (in dollars per share)	$ 0.15	$ 0.14	$ 0.42	$ 0.38
Diluted EPS (in dollars per share)	$ 0.15	$ 0.14	$ 0.42	$ 0.38
Stock options excluded from computation of earnings per share (in shares)	1,871,935	5,452,028	2,215,820	5,674,912

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Borrowings (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2013	Dec. 31, 2012
Borrowings
Total borrowings, net	$ 4,109,028	$ 4,373,496
Weighted Average Rate (as a percent)	2.46%	3.03%
Federal funds purchased
Borrowings
Total borrowings, net	285,000
Weighted Average Rate (as a percent)	0.27%
Reverse repurchase agreements
Borrowings
Total borrowings, net	1,100,000	1,100,000
Weighted Average Rate (as a percent)	3.87%	4.32%
FHLB-NY advances | FHLB-NY
Borrowings
Total borrowings, net	2,476,000	2,897,000
Weighted Average Rate (as a percent)	1.83%	2.07%
Other borrowings, net
Borrowings
Total borrowings, net	$ 248,028	$ 376,496
Weighted Average Rate (as a percent)	5.00%	6.62%

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Consolidated Statements of Financial Condition (Parenthetical) (USD $) In Thousands, except Share data, unless otherwise specified	Sep. 30, 2013	Dec. 31, 2012
Held-to-maturity securities, fair value (in dollars)	$ 1,896,771	$ 1,725,090
Preferred stock, par value (in dollars per share)	$ 1.00	$ 1.00
Preferred stock, shares authorized	5,000,000	5,000,000
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized	200,000,000	200,000,000
Common stock, shares issued	166,494,888	166,494,888
Common stock, shares outstanding	98,865,122	98,419,318
Treasury stock, shares	67,629,766	68,075,570
Unallocated common stock held by ESOP, shares	226,735	967,013
Series C Preferred Stock
Preferred stock, shares authorized	150,000
Preferred stock, shares issued	135,000	0
Preferred stock, shares outstanding	135,000	0

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Preferred Stock

9 Months Ended

Sep. 30, 2013

Preferred Stock

Preferred Stock

6.     Preferred Stock

On March 19, 2013, in a public offering, we sold 5,400,000 depositary shares, each representing a 1/40th interest in a share of our 6.50% Non-Cumulative Perpetual Preferred Stock, Series C, $1.00 par value per share, $1,000 liquidation preference per share (equivalent to $25 per depositary share), or Series C Preferred Stock.  We issued 135,000 shares of the Series C Preferred Stock in connection with the sale of the depositary shares.  The aggregate proceeds from the offering, net of underwriting discounts and other issuance costs, were approximately $129.8 million.

The Series C Preferred Stock, and corresponding depositary shares, may be redeemed at our option, in whole or in part, on April 15, 2018, or on any dividend payment date occurring thereafter, at a redemption price of $1,000 per share (equivalent to $25 per depositary share), plus any declared and unpaid dividends (without accumulation of any undeclared dividends). The Series C Preferred Stock may also be redeemed in whole, but not in part, at any time upon the occurrence of a “regulatory capital treatment event,” as defined in the certificate of designations included in the registration statement on Form 8-A filed with the SEC on March 19, 2013.  The holders of the Series C Preferred Stock, and the corresponding depositary shares, do not have the right to require the redemption or repurchase of the Series C Preferred Stock.

Beginning in July 2013, dividends are payable on the Series C Preferred Stock when, as and if declared by our Board of Directors, on a non-cumulative basis quarterly in arrears on January 15, April 15, July 15 and October 15 of each year at an annual rate of 6.50% on the liquidation preference of $1,000 per share.  No dividend shall be declared, paid, or set aside for payment on our common stock unless the full dividends for the most recently completed dividend period have been declared and paid on our Series C Preferred Stock.  On June 19, 2013, our Board of Directors declared the first quarterly cash dividend on our Series C Preferred Stock aggregating $2.8 million, or $20.94 per share, for the dividend period from the issuance date of March 19, 2013 through and including July 14, 2013, which was paid on July 15, 2013 to stockholders of record as of June 30, 2013.  On September 18, 2013, our Board of Directors declared the second quarterly cash dividend on our Series C Preferred Stock aggregating $2.2 million, or $16.25 per share, for the quarterly period from July 15, 2013 through and including September 14, 2013, which was paid on October 15, 2013 to stockholders of record as of September 30, 2013.

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Consolidated Statements of Comprehensive Income (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Consolidated Statements of Comprehensive Income
Net income	$ 16,924	$ 13,355	$ 46,441	$ 36,175
Net unrealized loss on securities available-for-sale:
Net unrealized holding loss on securities arising during the period	(1,286)	(3,796)	(7,889)	(3,194)
Reclassification adjustment for gain on sales of securities included in net income			(1,332)	(1,604)
Net unrealized loss on securities available-for-sale	(1,286)	(3,796)	(9,221)	(4,798)
Net actuarial loss adjustment on pension plans and other postretirement benefits:
Net actuarial loss adjustment arising during the period				24,286
Reclassification adjustment for net actuarial loss included in net income	585	448	1,754	3,077
Net actuarial loss adjustment on pension plans and other postretirement benefits	585	448	1,754	27,363
Prior service cost adjustment on pension plans and other postretirement benefits:
Prior service cost adjustment arising during the period				(3,537)
Reclassification adjustment for prior service cost included in net income	34	32	103	67
Prior service cost adjustment on pension plans and other postretirement benefits	34	32	103	(3,470)
Reclassification adjustment for loss on cash flow hedge included in net income		56		151
Total other comprehensive (loss) income, net of tax	(667)	(3,260)	(7,364)	19,246
Comprehensive income	$ 16,257	$ 10,095	$ 39,077	$ 55,421

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Fair Value Measurements (Details 2) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2013	Dec. 31, 2012
Carrying value of assets
Impaired loans	$ 386,040	$ 346,906
MSR, net	10,835	6,947
REO, net	34,983	28,523
Carrying Value
Carrying value of assets
Loans held-for-sale, net	10,485	76,306
MSR, net	10,835	6,947
Level 3
Carrying value of assets
Loans held-for-sale, net	10,866	78,486
MSR, net	10,838	6,948
Measured on a non-recurring basis | Level 3 | Carrying Value
Carrying value of assets
Impaired loans	265,698	282,723
MSR, net	10,835	6,947
REO, net	20,903	20,796
Total	298,320	314,347
Measured on a non-recurring basis | Level 3 | Carrying Value | Non-performing loans held-for-sale, net
Carrying value of assets
Loans held-for-sale, net	$ 884	$ 3,881

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Consolidated Statements of Financial Condition (USD $) In Thousands, unless otherwise specified	Sep. 30, 2013	Dec. 31, 2012
Assets:
Cash and due from banks	$ 137,737	$ 121,473
Available-for-sale securities:
Encumbered	108,640	79,851
Unencumbered	307,110	256,449
Total available-for-sale securities	415,750	336,300
Held-to-maturity securities, fair value of $1,896,771 and $1,725,090, respectively:
Encumbered	1,133,176	1,133,193
Unencumbered	782,285	566,948
Total held-to-maturity securities	1,915,461	1,700,141
Federal Home Loan Bank of New York stock, at cost	153,217	171,194
Loans held-for-sale, net	10,485	76,306
Loans receivable	12,541,543	13,223,972
Allowance for loan losses	(143,000)	(145,501)
Loans receivable, net	12,398,543	13,078,471
Mortgage servicing rights, net	10,835	6,947
Accrued interest receivable	39,650	41,688
Premises and equipment, net	113,075	115,632
Goodwill	185,151	185,151
Bank owned life insurance	421,182	418,155
Real estate owned, net	34,983	28,523
Other assets	186,020	216,661
Total assets	16,022,089	16,496,642
Deposits:
Savings	2,562,927	2,802,298
Money market	1,913,607	1,586,556
NOW and demand deposit	2,133,062	2,094,733
Certificates of deposit	3,450,778	3,960,371
Total deposits	10,060,374	10,443,958
Federal funds purchased	285,000
Reverse repurchase agreements	1,100,000	1,100,000
Federal Home Loan Bank of New York advances	2,476,000	2,897,000
Other borrowings, net	248,028	376,496
Mortgage escrow funds	137,248	113,101
Accrued expenses and other liabilities	257,523	272,098
Total liabilities	14,564,173	15,202,653
Stockholders' Equity:
Preferred stock, $1.00 par value; 5,000,000 shares authorized; Series C (150,000 shares authorized; and 135,000 and -0- shares issued and outstanding, respectively)	129,796
Common stock, $0.01 par value (200,000,000 shares authorized; 166,494,888 shares issued; and 98,865,122 and 98,419,318 shares outstanding, respectively)	1,665	1,665
Additional paid-in capital	889,546	884,689
Retained earnings	1,915,736	1,891,022
Treasury stock (67,629,766 and 68,075,570 shares, at cost, respectively)	(1,397,543)	(1,406,755)
Accumulated other comprehensive loss	(80,454)	(73,090)
Unallocated common stock held by ESOP (226,735 and 967,013 shares, respectively)	(830)	(3,542)
Total stockholders' equity	1,457,916	1,293,989
Total liabilities and stockholders' equity	$ 16,022,089	$ 16,496,642

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Other Comprehensive Income/Loss (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Changes in accumulated other comprehensive loss components
Balance at the beginning of the period	$ (79,787)		$ (73,090)
Other comprehensive (loss) income, net of tax	(667)	(3,260)	(7,364)	19,246
Balance at the end of the period	(80,454)		(80,454)
Net unrealized gain (loss) on securities available-for-sale
Changes in accumulated other comprehensive loss components
Balance at the beginning of the period	(484)		7,451
Other comprehensive (loss) income, net of tax	(1,286)		(9,221)
Balance at the end of the period	(1,770)		(1,770)
Net actuarial loss on pension plans and other postretirement benefits
Changes in accumulated other comprehensive loss components
Balance at the beginning of the period	(75,946)		(77,115)
Other comprehensive (loss) income, net of tax	585		1,754
Balance at the end of the period	(75,361)		(75,361)
Prior service cost on pension plans and other postretirement benefits
Changes in accumulated other comprehensive loss components
Balance at the beginning of the period	(3,357)		(3,426)
Other comprehensive (loss) income, net of tax	34		103
Balance at the end of the period	$ (3,323)		$ (3,323)

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Securities (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2013	Dec. 31, 2012
Securities
Available-for-sale, amortized cost	$ 424,216	$ 330,481
Available-for-sale, Gross Unrealized Gains	3,187	6,510
Available-for-sale, Gross Unrealized Losses	(11,653)	(691)
Total available-for-sale securities	415,750	336,300
Held-to-maturity, amortized cost	1,915,461	1,700,141
Held-to-maturity, Gross Unrealized Gains	17,217	27,905
Held-to-maturity, Gross Unrealized Losses	(35,907)	(2,956)
Held-to-maturity, estimated fair value	1,896,771	1,725,090
Residential mortgage-backed securities
Securities
Available-for-sale, amortized cost	325,527	231,796
Available-for-sale, Gross Unrealized Gains	3,187	6,296
Available-for-sale, Gross Unrealized Losses	(5,395)	(671)
Total available-for-sale securities	323,319	237,421
Held-to-maturity, amortized cost	1,826,730	1,699,485
Held-to-maturity, Gross Unrealized Gains	17,217	27,905
Held-to-maturity, Gross Unrealized Losses	(29,581)	(2,956)
Held-to-maturity, estimated fair value	1,814,366	1,724,434
GSE issuance REMICs and CMOs
Securities
Available-for-sale, amortized cost	300,047	200,152
Available-for-sale, Gross Unrealized Gains	2,310	5,258
Available-for-sale, Gross Unrealized Losses	(5,391)	(583)
Total available-for-sale securities	296,966	204,827
Held-to-maturity, amortized cost	1,534,021	1,693,437
Held-to-maturity, Gross Unrealized Gains	16,264	27,787
Held-to-maturity, Gross Unrealized Losses	(21,336)	(2,955)
Held-to-maturity, estimated fair value	1,528,949	1,718,269
Non-GSE issuance REMICs and CMOs
Securities
Available-for-sale, amortized cost	8,330	11,296
Available-for-sale, Gross Unrealized Gains	67	9
Available-for-sale, Gross Unrealized Losses	(1)	(86)
Total available-for-sale securities	8,396	11,219
Held-to-maturity, amortized cost	4,054	5,791
Held-to-maturity, Gross Unrealized Gains	69	112
Held-to-maturity, Gross Unrealized Losses	(10)
Held-to-maturity, estimated fair value	4,113	5,903
GSE pass-through certificates
Securities
Available-for-sale, amortized cost	17,150	20,348
Available-for-sale, Gross Unrealized Gains	810	1,029
Available-for-sale, Gross Unrealized Losses	(3)	(2)
Total available-for-sale securities	17,957	21,375
Held-to-maturity, amortized cost	288,655	257
Held-to-maturity, Gross Unrealized Gains	884	6
Held-to-maturity, Gross Unrealized Losses	(8,235)	(1)
Held-to-maturity, estimated fair value	281,304	262
Obligations of GSEs
Securities
Available-for-sale, amortized cost	98,674	98,670
Available-for-sale, Gross Unrealized Gains		214
Available-for-sale, Gross Unrealized Losses	(6,244)	(5)
Total available-for-sale securities	92,430	98,879
Held-to-maturity, amortized cost	88,127
Held-to-maturity, Gross Unrealized Losses	(6,326)
Held-to-maturity, estimated fair value	81,801
Fannie Mae stock
Securities
Available-for-sale, amortized cost	15	15
Available-for-sale, Gross Unrealized Losses	(14)	(15)
Total available-for-sale securities	1
Other
Securities
Held-to-maturity, amortized cost	604	656
Held-to-maturity, estimated fair value	$ 604	$ 656

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Borrowings (Tables)

9 Months Ended

Sep. 30, 2013

Borrowings

Summary of borrowings and their weighted average rates

	At September 30, 2013			At December 31, 2012
(Dollars in Thousands)	Amount		Weighted Average Rate	Amount		Weighted Average Rate
Federal funds purchased	$	285,000	0.27%	$	—	—%
Reverse repurchase agreements	1,100,000		3.87	1,100,000		4.32
FHLB-NY advances	2,476,000		1.83	2,897,000		2.07
Other borrowings, net	248,028		5.00	376,496		6.62
Total borrowings, net	$	4,109,028	2.46%	$	4,373,496	3.03%

Schedule of contractual maturities of FHLB-NY advances and reverse repurchase agreements

(In Thousands)	FHLB-NY Advances			Reverse Repurchase Agreements
Contractual Maturity:
Twelve months or less	$	776,000	(1)	$	—
Thirteen to twenty-four months	100,000			—
Twenty-five to thirty-six months	750,000			—
Thirty-seven to forty-eight months	—			600,000		(2)
Forty-nine to sixty months	—			200,000		(3)
Over sixty months	850,000		(4)	300,000		(5)
Total	$	2,476,000		$	1,100,000

(1)	Includes $176.0 million of borrowings due overnight, $350.0 million of borrowings due in less than 30 days, $100.0 million of borrowings due in 30-90 days and $150.0 million of borrowings due after 90 days.
(2)	Callable within the next three months and on a quarterly basis thereafter.
(3)	Callable in 2015.
(4)	Callable in 2017.
(5)	Includes $100.0 million of borrowings which are callable within the next three months and on a quarterly basis thereafter, $100.0 million of borrowings which are callable in 2016 and $100.0 million of borrowings which are callable in 2017.

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Loans Receivable and Allowance for Loan Losses (Details 12) (Mortgage Loans (Gross), USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013 item	Sep. 30, 2012 item	Sep. 30, 2013 item	Sep. 30, 2012 item
Information about loans receivable by segment and class modified in troubled debt restructuring
Number of Loans	45	5	62	13
Recorded Investment	$ 12,227	$ 3,721	$ 16,190	$ 7,866
Residential Mortgage Loans | Full documentation interest-only loans
Information about loans receivable by segment and class modified in troubled debt restructuring
Number of Loans	14		22
Recorded Investment	3,365		5,343
Residential Mortgage Loans | Full documentation amortizing loans
Information about loans receivable by segment and class modified in troubled debt restructuring
Number of Loans	8	1	10	1
Recorded Investment	2,159	485	2,589	485
Residential Mortgage Loans | Reduced documentation interest-only loans
Information about loans receivable by segment and class modified in troubled debt restructuring
Number of Loans	20	3	24	5
Recorded Investment	5,729	1,174	6,707	1,821
Residential Mortgage Loans | Reduced documentation amortizing loans
Information about loans receivable by segment and class modified in troubled debt restructuring
Number of Loans	2		5	5
Recorded Investment	303		880	1,817
Multi-Family
Information about loans receivable by segment and class modified in troubled debt restructuring
Number of Loans	1	1	1	2
Recorded Investment	$ 671	$ 2,062	$ 671	$ 3,743

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Pension Plans and Other Postretirement Benefits (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Pension Benefits
Pension plans and other postretirement benefits
Service cost				$ 2,025
Interest cost	2,387	2,663	7,162	8,327
Expected return on plan assets	(3,188)	(3,109)	(9,565)	(8,837)
Recognized net actuarial loss	785	563	2,354	4,366
Amortization of prior service cost (credit)	53	56	159	122
Curtailment				7
Net periodic cost	37	173	110	6,010
Other Postretirement Benefits
Pension plans and other postretirement benefits
Service cost	396	265	1,185	796
Interest cost	319	345	959	1,034
Recognized net actuarial loss	118	129	354	387
Amortization of prior service cost (credit)		(6)		(18)
Net periodic cost	$ 833	$ 733	$ 2,498	$ 2,199

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Loans Receivable and Allowance for Loan Losses (Details 7) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2013	Dec. 31, 2012
Balances of multi-family and commercial real estate mortgage loan receivable segments by credit quality indicator
Total	$ 12,483,497	$ 13,155,914
Mortgage Loans (Gross)
Balances of multi-family and commercial real estate mortgage loan receivable segments by credit quality indicator
Total	12,239,352	12,891,820
Mortgage Loans (Gross) | Multi-Family
Balances of multi-family and commercial real estate mortgage loan receivable segments by credit quality indicator
Total	3,118,014	2,406,678
Mortgage Loans (Gross) | Multi-Family | Not criticized
Balances of multi-family and commercial real estate mortgage loan receivable segments by credit quality indicator
Total	3,027,701	2,271,006
Mortgage Loans (Gross) | Multi-Family | Special mention
Balances of multi-family and commercial real estate mortgage loan receivable segments by credit quality indicator
Total	20,016	54,956
Mortgage Loans (Gross) | Multi-Family | Substandard
Balances of multi-family and commercial real estate mortgage loan receivable segments by credit quality indicator
Total	70,297	80,716
Mortgage Loans (Gross) | Commercial Real Estate
Balances of multi-family and commercial real estate mortgage loan receivable segments by credit quality indicator
Total	822,820	773,916
Mortgage Loans (Gross) | Commercial Real Estate | Not criticized
Balances of multi-family and commercial real estate mortgage loan receivable segments by credit quality indicator
Total	774,515	706,334
Mortgage Loans (Gross) | Commercial Real Estate | Special mention
Balances of multi-family and commercial real estate mortgage loan receivable segments by credit quality indicator
Total	8,123	28,210
Mortgage Loans (Gross) | Commercial Real Estate | Substandard
Balances of multi-family and commercial real estate mortgage loan receivable segments by credit quality indicator
Total	$ 40,182	$ 39,372

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Loans Receivable and Allowance for Loan Losses (Details 3)	9 Months Ended
	Sep. 30, 2013
Loans receivable and allowance for loan losses
Historical loss experience analysis period of time, one	12 months
Historical loss experience analysis period of time, two	15 months
Historical loss experience analysis period of time, three	18 months
Historical loss experience analysis period of time, four	24 months
Historical loss experience analysis period of time, five	2 years
Extended prior period over which loss experience factors are evaluated to consider trends for the majority of loan portfolio	2 years
Residential
Loans receivable and allowance for loan losses
Period after which loans are individually evaluated for impairment	180 days

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Loans Receivable and Allowance for Loan Losses (Details 4) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Loans receivable and allowance for loan losses
Balance at the beginning of the period	$ 143,900	$ 148,102	$ 145,501	$ 157,185
Provision charged (credited) to operations	2,541	9,500	16,193	29,500
Charge-offs	(6,496)	(11,698)	(27,954)	(44,822)
Recoveries	3,055	2,568	9,260	6,609
Balance at the end of the period	143,000	148,472	143,000	148,472
Mortgage Loans (Gross) | Residential
Loans receivable and allowance for loan losses
Balance at the beginning of the period	78,788	87,394	89,267	105,991
Provision charged (credited) to operations	7,659	9,210	7,488	16,387
Charge-offs	(5,560)	(8,195)	(20,332)	(37,598)
Recoveries	2,537	2,355	7,001	5,984
Balance at the end of the period	83,424	90,764	83,424	90,764
Mortgage Loans (Gross) | Multi-Family
Loans receivable and allowance for loan losses
Balance at the beginning of the period	40,865	48,142	35,514	35,422
Provision charged (credited) to operations	(2,521)	(6,168)	5,131	8,381
Charge-offs	(99)	(1,233)	(3,637)	(3,139)
Recoveries		122	1,237	199
Balance at the end of the period	38,245	40,863	38,245	40,863
Mortgage Loans (Gross) | Commercial Real Estate
Loans receivable and allowance for loan losses
Balance at the beginning of the period	16,642	9,109	14,404	11,972
Provision charged (credited) to operations	(2,592)	3,828	1,378	1,303
Charge-offs	(293)	(1,379)	(2,313)	(1,718)
Recoveries	247		535	1
Balance at the end of the period	14,004	11,558	14,004	11,558
Consumer and Other Loans
Loans receivable and allowance for loan losses
Balance at the beginning of the period	7,605	3,457	6,316	3,800
Provision charged (credited) to operations	(5)	2,630	2,196	3,429
Charge-offs	(544)	(891)	(1,672)	(2,367)
Recoveries	271	91	487	425
Balance at the end of the period	$ 7,327	$ 5,287	$ 7,327	$ 5,287

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Borrowings

9 Months Ended

Sep. 30, 2013

Borrowings

Borrowings

5.     Borrowings

The following table summarizes our borrowings and their weighted average rates at the dates indicated.

	At September 30, 2013			At December 31, 2012
(Dollars in Thousands)	Amount		Weighted Average Rate	Amount		Weighted Average Rate
Federal funds purchased	$	285,000	0.27%	$	—	—%
Reverse repurchase agreements	1,100,000		3.87	1,100,000		4.32
FHLB-NY advances	2,476,000		1.83	2,897,000		2.07
Other borrowings, net	248,028		5.00	376,496		6.62
Total borrowings, net	$	4,109,028	2.46%	$	4,373,496	3.03%

Included in our borrowings are various obligations which, by their terms, may be called by the counterparty.  At September 30, 2013 and December 31, 2012, we had $1.95 billion of callable borrowings, all of which at December 31, 2012 were contractually callable by the counterparty within three months and on a quarterly basis thereafter.  During the nine months ended September 30, 2013, we restructured $1.35 billion of these borrowings with the counterparties, of which $500.0 million were reverse repurchase agreements and $850.0 million were Federal Home Loan Bank of New York, or FHLB-NY, advances, resulting in a reduction in the weighted average interest rate on such borrowings from 4.40% to 3.46% and an extension of terms from a weighted average remaining term at the time of the restructuring of approximately 4 years to approximately 7 years.  The restructuring also extended the contractual call dates on $950.0 million of these borrowings to 2017, on $100.0 million of these borrowings to 2016 and on $200.0 million of these borrowings to 2015.

The following table sets forth the contractual maturities of our FHLB-NY advances and our reverse repurchase agreements at September 30, 2013.

(In Thousands)	FHLB-NY Advances			Reverse Repurchase Agreements
Contractual Maturity:
Twelve months or less	$	776,000	(1)	$	—
Thirteen to twenty-four months	100,000			—
Twenty-five to thirty-six months	750,000			—
Thirty-seven to forty-eight months	—			600,000		(2)
Forty-nine to sixty months	—			200,000		(3)
Over sixty months	850,000		(4)	300,000		(5)
Total	$	2,476,000		$	1,100,000

(1)	Includes $176.0 million of borrowings due overnight, $350.0 million of borrowings due in less than 30 days, $100.0 million of borrowings due in 30-90 days and $150.0 million of borrowings due after 90 days.
(2)	Callable within the next three months and on a quarterly basis thereafter.
(3)	Callable in 2015.
(4)	Callable in 2017.
(5)	Includes $100.0 million of borrowings which are callable within the next three months and on a quarterly basis thereafter, $100.0 million of borrowings which are callable in 2016 and $100.0 million of borrowings which are callable in 2017.

Our former finance subsidiary, Astoria Capital Trust I, was formed for the purpose of issuing $125.0 million aggregate liquidation amount of 9.75% Capital Securities due November 1, 2029, or Capital Securities, and $3.9 million of common securities (which were the only voting securities of Astoria Capital Trust I and were owned by Astoria Financial Corporation) and used the proceeds to acquire 9.75% Junior Subordinated Debentures, due November 1, 2029,  issued by Astoria Financial Corporation totaling $128.9 million.  The Junior Subordinated Debentures were the sole assets of Astoria Capital Trust I.  The Junior Subordinated Debentures were prepayable, in whole or in part, at our option at declining premiums to November 1, 2019, after which the Junior Subordinated Debentures were prepayable at par value.  The Capital Securities had the same prepayment provisions as the Junior Subordinated Debentures.  On May 10, 2013, we prepaid in whole our Junior Subordinated Debentures, which were included in other borrowings, net, pursuant to the optional prepayment provisions of the indenture at a prepayment price of 103.413% of the $128.9 million aggregate principal amount, plus accrued and unpaid interest to, but not including, the date of repayment.  As a result of the prepayment in whole of the Junior Subordinated Debentures, Astoria Capital Trust I simultaneously applied the proceeds of such prepayment to redeem its Capital Securities, as well as the common securities owned by Astoria Financial Corporation.  The prepayment of the Junior Subordinated Debentures resulted in a $4.3 million prepayment charge in the 2013 second quarter for the early extinguishment of this debt.

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Litigation (Details) (USD $) In Millions, unless otherwise specified	9 Months Ended
	Sep. 30, 2013 item
Litigation
Alleged tax deficiency including interest and penalties related to 2006 through 2008 tax years	$ 13.3
Number of subsidiaries to which alleged tax deficiencies are related	2
Liability or reserve recorded related to alleged tax deficiencies	$ 0

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Securities (Details 2) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2013	Dec. 31, 2012
Securities
Available-for-sale, Less Than Twelve Months, Estimated Fair Value	$ 250,219	$ 92,893
Available-for-sale, Less Than Twelve Months, Gross Unrealized Losses	(11,438)	(589)
Available-for-sale, Twelve Months or Longer, Estimated Fair Value	17,527	10,756
Available-for-sale, Twelve Months or Longer, Gross Unrealized Losses	(215)	(102)
Available-for-sale, Total, Estimated Fair Value	267,746	103,649
Available-for-sale, Total, Gross Unrealized Losses	(11,653)	(691)
Held-to-maturity, Less Than Twelve Months, Estimated Fair Value	911,991	413,699
Held-to-maturity, Less Than Twelve Months, Gross Unrealized Losses	(32,095)	(2,760)
Held-to-maturity, Twelve Months or Longer, Estimated Fair Value	78,179	12,259
Held-to-maturity, Twelve Months or Longer, Gross Unrealized Losses	(3,812)	(196)
Held-to-maturity, Total, Estimated Fair Value	990,170	425,958
Held-to-maturity, Total, Gross Unrealized Losses	(35,907)	(2,956)
Residential mortgage-backed securities
Securities
Available-for-sale, Total, Gross Unrealized Losses	(5,395)	(671)
Held-to-maturity, Total, Gross Unrealized Losses	(29,581)	(2,956)
GSE issuance REMICs and CMOs
Securities
Available-for-sale, Less Than Twelve Months, Estimated Fair Value	157,497	67,841
Available-for-sale, Less Than Twelve Months, Gross Unrealized Losses	(5,193)	(583)
Available-for-sale, Twelve Months or Longer, Estimated Fair Value	17,296
Available-for-sale, Twelve Months or Longer, Gross Unrealized Losses	(198)
Available-for-sale, Total, Estimated Fair Value	174,793	67,841
Available-for-sale, Total, Gross Unrealized Losses	(5,391)	(583)
Held-to-maturity, Less Than Twelve Months, Estimated Fair Value	647,583	413,651
Held-to-maturity, Less Than Twelve Months, Gross Unrealized Losses	(17,525)	(2,759)
Held-to-maturity, Twelve Months or Longer, Estimated Fair Value	78,148	12,259
Held-to-maturity, Twelve Months or Longer, Gross Unrealized Losses	(3,811)	(196)
Held-to-maturity, Total, Estimated Fair Value	725,731	425,910
Held-to-maturity, Total, Gross Unrealized Losses	(21,336)	(2,955)
Non-GSE issuance REMICs and CMOs
Securities
Available-for-sale, Twelve Months or Longer, Estimated Fair Value	140	10,709
Available-for-sale, Twelve Months or Longer, Gross Unrealized Losses	(1)	(86)
Available-for-sale, Total, Estimated Fair Value	140	10,709
Available-for-sale, Total, Gross Unrealized Losses	(1)	(86)
Held-to-maturity, Less Than Twelve Months, Estimated Fair Value	398
Held-to-maturity, Less Than Twelve Months, Gross Unrealized Losses	(10)
Held-to-maturity, Total, Estimated Fair Value	398
Held-to-maturity, Total, Gross Unrealized Losses	(10)
GSE pass-through certificates
Securities
Available-for-sale, Less Than Twelve Months, Estimated Fair Value	292	57
Available-for-sale, Less Than Twelve Months, Gross Unrealized Losses	(1)	(1)
Available-for-sale, Twelve Months or Longer, Estimated Fair Value	90	47
Available-for-sale, Twelve Months or Longer, Gross Unrealized Losses	(2)	(1)
Available-for-sale, Total, Estimated Fair Value	382	104
Available-for-sale, Total, Gross Unrealized Losses	(3)	(2)
Held-to-maturity, Less Than Twelve Months, Estimated Fair Value	182,209	48
Held-to-maturity, Less Than Twelve Months, Gross Unrealized Losses	(8,234)	(1)
Held-to-maturity, Twelve Months or Longer, Estimated Fair Value	31
Held-to-maturity, Twelve Months or Longer, Gross Unrealized Losses	(1)
Held-to-maturity, Total, Estimated Fair Value	182,240	48
Held-to-maturity, Total, Gross Unrealized Losses	(8,235)	(1)
Obligations of GSEs
Securities
Available-for-sale, Less Than Twelve Months, Estimated Fair Value	92,430	24,995
Available-for-sale, Less Than Twelve Months, Gross Unrealized Losses	(6,244)	(5)
Available-for-sale, Total, Estimated Fair Value	92,430	24,995
Available-for-sale, Total, Gross Unrealized Losses	(6,244)	(5)
Held-to-maturity, Less Than Twelve Months, Estimated Fair Value	81,801
Held-to-maturity, Less Than Twelve Months, Gross Unrealized Losses	(6,326)
Held-to-maturity, Total, Estimated Fair Value	81,801
Held-to-maturity, Total, Gross Unrealized Losses	(6,326)
Fannie Mae stock
Securities
Available-for-sale, Twelve Months or Longer, Estimated Fair Value	1
Available-for-sale, Twelve Months or Longer, Gross Unrealized Losses	(14)	(15)
Available-for-sale, Total, Estimated Fair Value	1
Available-for-sale, Total, Gross Unrealized Losses	$ (14)	$ (15)

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Loans Receivable and Allowance for Loan Losses (Details 10) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Average recorded investment, interest income recognized and cash basis interest income related to impaired mortgage loans by segment and class
Average Recorded Investment	$ 389,861	$ 355,791	$ 399,587	$ 341,723
Interest Income Recognized	2,912	3,781	8,617	8,252
Cash Basis Interest Income	3,091	2,588	9,121	7,607
Residential | Full documentation interest-only loans
Average recorded investment, interest income recognized and cash basis interest income related to impaired mortgage loans by segment and class
Average Recorded Investment, Loans with an allowance recorded	107,893	10,254	105,931	10,360
Average Recorded Investment, Loans without an allowance recorded	9,075	83,722	14,433	81,638
Interest Income Recognized, Loans with an allowance recorded	762	79	2,114	247
Interest Income Recognized, Loans without an allowance recorded		417		1,069
Cash Basis Interest Income, Loans with an allowance recorded	763	77	2,229	247
Cash Basis Interest Income, Loans without an allowance recorded		411		1,136
Residential | Full documentation amortizing loans
Average recorded investment, interest income recognized and cash basis interest income related to impaired mortgage loans by segment and class
Average Recorded Investment, Loans with an allowance recorded	31,128	4,210	29,465	4,071
Average Recorded Investment, Loans without an allowance recorded	2,968	16,611	4,396	17,452
Interest Income Recognized, Loans with an allowance recorded	218	40	623	121
Interest Income Recognized, Loans without an allowance recorded		117		221
Cash Basis Interest Income, Loans with an allowance recorded	220	41	639	122
Cash Basis Interest Income, Loans without an allowance recorded		108		234
Residential | Reduced documentation interest-only loans
Average recorded investment, interest income recognized and cash basis interest income related to impaired mortgage loans by segment and class
Average Recorded Investment, Loans with an allowance recorded	144,468	10,469	146,773	10,967
Average Recorded Investment, Loans without an allowance recorded		118,021	2,086	115,363
Interest Income Recognized, Loans with an allowance recorded	1,171	130	3,053	342
Interest Income Recognized, Loans without an allowance recorded		742		1,731
Cash Basis Interest Income, Loans with an allowance recorded	1,174	122	3,205	345
Cash Basis Interest Income, Loans without an allowance recorded		728		1,824
Residential | Reduced documentation amortizing loans
Average recorded investment, interest income recognized and cash basis interest income related to impaired mortgage loans by segment and class
Average Recorded Investment, Loans with an allowance recorded	24,452	2,272	25,424	2,084
Average Recorded Investment, Loans without an allowance recorded		18,694		17,293
Interest Income Recognized, Loans with an allowance recorded	158	27	464	86
Interest Income Recognized, Loans without an allowance recorded		79		291
Cash Basis Interest Income, Loans with an allowance recorded	152	19	493	78
Cash Basis Interest Income, Loans without an allowance recorded		69		303
Multi-Family
Average recorded investment, interest income recognized and cash basis interest income related to impaired mortgage loans by segment and class
Average Recorded Investment, Loans with an allowance recorded	19,557	60,560	18,975	55,319
Average Recorded Investment, Loans without an allowance recorded	31,464	12,517	33,294	9,168
Interest Income Recognized, Loans with an allowance recorded	34	1,146	659	2,252
Interest Income Recognized, Loans without an allowance recorded	401	503	1,165	921
Cash Basis Interest Income, Loans with an allowance recorded	169	590	722	1,946
Cash Basis Interest Income, Loans without an allowance recorded	416	227	1,229	662
Commercial Real Estate
Average recorded investment, interest income recognized and cash basis interest income related to impaired mortgage loans by segment and class
Average Recorded Investment, Loans with an allowance recorded	7,604	11,838	8,692	13,196
Average Recorded Investment, Loans without an allowance recorded	11,252	6,623	10,118	4,812
Interest Income Recognized, Loans with an allowance recorded	56	229	253	430
Interest Income Recognized, Loans without an allowance recorded	112	272	286	541
Cash Basis Interest Income, Loans with an allowance recorded	66	97	285	321
Cash Basis Interest Income, Loans without an allowance recorded	$ 131	$ 99	$ 319	$ 389

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Other Comprehensive Income/Loss

9 Months Ended

Sep. 30, 2013

Other Comprehensive Income/Loss

Other Comprehensive Income/Loss

8.     Other Comprehensive Income/Loss

The following disclosures reflect our adoption, effective January 1, 2013, of the guidance in Accounting Standards Update, or ASU, 2013-02, “Comprehensive Income (Topic 220) Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income.” The guidance in ASU 2013-02 is effective prospectively for reporting periods beginning after December 15, 2012 and is presentation related only.  Our adoption of ASU 2013-02 did not have an impact on our financial condition or results of operations.

The following tables set forth the components of accumulated other comprehensive loss at the dates indicated and the changes during the three and nine months ended September 30, 2013.

(In Thousands)	At June 30, 2013		Other Comprehensive (Loss) Income		At September 30, 2013
Net unrealized loss on securities available-for-sale	$     (484	)	$ (1,286	)	$  (1,770	)
Net actuarial loss on pension plans and other postretirement benefits	(75,946	)	585		(75,361	)
Prior service cost on pension plans and other postretirement benefits	(3,357	)	34		(3,323	)
Accumulated other comprehensive loss	$(79,787	)	$    (667	)	$(80,454	)

(In Thousands)	At December 31, 2012		Other Comprehensive (Loss) Income		At September 30, 2013
Net unrealized gain (loss) on securities available-for-sale	$   7,451		$  (9,221	)	$   (1,770	)
Net actuarial loss on pension plans and other postretirement benefits	(77,115	)	1,754		(75,361	)
Prior service cost on pension plans and other postretirement benefits	(3,426	)	103		(3,323	)
Accumulated other comprehensive loss	$(73,090	)	$  (7,364	)	$ (80,454	)

The following tables set forth the components of other comprehensive loss for the periods indicated.

	For the Three Months Ended September 30, 2013
(In Thousands)	Before Tax Amount		Tax Benefit (Expense)		After Tax Amount
Net unrealized holding loss on securities available-for-sale arising during the period	$   (1,984	)	$   698		$  (1,286	)
Reclassification adjustment for net actuarial loss included in net income	903		(318	)	585
Reclassification adjustment for prior service cost included in net income	53		(19	)	34
Other comprehensive loss	$   (1,028	)	$   361		$     (667	)

	For the Nine Months Ended September 30, 2013
(In Thousands)	Before Tax Amount		Tax Benefit (Expense)		After Tax Amount
Net unrealized loss on securities available-for-sale:
Net unrealized holding loss on securities arising during the period	$  (12,180	)	$  4,291		$  (7,889	)
Reclassification adjustment for gain on sales of securities included in net income	(2,057	)	725		(1,332	)
Net unrealized loss on securities available-for-sale	(14,237	)	5,016		(9,221	)
Reclassification adjustment for net actuarial loss included in net income	2,708		(954	)	1,754
Reclassification adjustment for prior service cost included in net income	159		(56	)	103
Other comprehensive loss	$  (11,370	)	$  4,006		$  (7,364	)

The following table sets forth information about amounts reclassified from accumulated other comprehensive loss to, and the affected line items in, the consolidated statements of income for the periods indicated.

(In Thousands)	For the Three Months Ended September 30, 2013		For the Nine Months Ended September 30, 2013		Income Statement Line Item
Reclassification adjustment for gain on sales of securities	$     —		$  2,057		Gain on sales of securities
Reclassification adjustment for net actuarial loss (1)	(903	)	(2,708	)	Compensation and benefits
Reclassification adjustment for prior service cost (1)	(53	)	(159	)	Compensation and benefits
Total reclassifications, before tax	(956	)	(810	)
Income tax effect	337		285		Income tax expense
Total reclassifications, net of tax	$  (619	)	$    (525	)	Net income

(1) These other comprehensive loss components are included in the computations of net periodic cost for our defined benefit pension plans and other postretirement benefit plan.  See Note 9 for additional details.

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Loans Receivable and Allowance for Loan Losses

9 Months Ended

Sep. 30, 2013

Loans Receivable and Allowance for Loan Losses

Loans Receivable and Allowance for Loan Losses

4.     Loans Receivable and Allowance for Loan Losses

The following tables set forth the composition of our loans receivable portfolio, and an aging analysis by accruing and non-accrual loans, by segment and class at the dates indicated.

	At September 30, 2013
	Past Due
	30-59		60-89		90 Days		Total
(In Thousands)	Days		Days		or More		Past Due		Current		Total
Accruing loans:
Mortgage loans (gross):
Residential:
Full documentation interest-only	$	23,479	$	6,327	$	—	$	29,806	$	1,387,347	$	1,417,153
Full documentation amortizing	29,947		9,623		—		39,570		5,408,913		5,448,483
Reduced documentation interest-only	24,384		7,232		—		31,616		723,406		755,022
Reduced documentation amortizing	8,635		1,997		—		10,632		348,810		359,442
Total residential	86,445		25,179		—		111,624		7,868,476		7,980,100
Multi-family	8,961		1,448		—		10,409		3,091,944		3,102,353
Commercial real estate	—		1,024		55		1,079		811,128		812,207
Total mortgage loans	95,406		27,651		55		123,112		11,771,548		11,894,660
Consumer and other loans (gross):
Home equity lines of credit	2,573		1,350		—		3,923		196,121		200,044
Other	60		36		—		96		37,499		37,595
Total consumer and other loans	2,633		1,386		—		4,019		233,620		237,639
Total accruing loans	$	98,039	$	29,037	$	55	$	127,131	$	12,005,168	$	12,132,299
Non-accrual loans:
Mortgage loans (gross):
Residential:
Full documentation interest-only	$	1,863	$	—	$	85,019	$	86,882	$	21,802	$	108,684
Full documentation amortizing	346		1,226		42,294		43,866		8,675		52,541
Reduced documentation interest-only	3,129		492		91,089		94,710		29,814		124,524
Reduced documentation amortizing	1,532		129		26,289		27,950		4,719		32,669
Total residential	6,870		1,847		244,691		253,408		65,010		318,418
Multi-family	1,030		363		11,037		12,430		3,231		15,661
Commercial real estate	—		937		1,098		2,035		8,578		10,613
Total mortgage loans	7,900		3,147		256,826		267,873		76,819		344,692
Consumer and other loans (gross):
Home equity lines of credit	—		—		6,441		6,441		32		6,473
Other	—		—		33		33		—		33
Total consumer and other loans	—		—		6,474		6,474		32		6,506
Total non-accrual loans	$	7,900	$	3,147	$	263,300	$	274,347	$	76,851	$	351,198
Total loans:
Mortgage loans (gross):
Residential:
Full documentation interest-only	$	25,342	$	6,327	$	85,019	$	116,688	$	1,409,149	$	1,525,837
Full documentation amortizing	30,293		10,849		42,294		83,436		5,417,588		5,501,024
Reduced documentation interest-only	27,513		7,724		91,089		126,326		753,220		879,546
Reduced documentation amortizing	10,167		2,126		26,289		38,582		353,529		392,111
Total residential	93,315		27,026		244,691		365,032		7,933,486		8,298,518
Multi-family	9,991		1,811		11,037		22,839		3,095,175		3,118,014
Commercial real estate	—		1,961		1,153		3,114		819,706		822,820
Total mortgage loans	103,306		30,798		256,881		390,985		11,848,367		12,239,352
Consumer and other loans (gross):
Home equity lines of credit	2,573		1,350		6,441		10,364		196,153		206,517
Other	60		36		33		129		37,499		37,628
Total consumer and other loans	2,633		1,386		6,474		10,493		233,652		244,145
Total loans	$	105,939	$	32,184	$	263,355	$	401,478	$	12,082,019	$	12,483,497
Net unamortized premiums and deferred loan origination costs											58,046
Loans receivable											12,541,543
Allowance for loan losses											(143,000		)
Loans receivable, net											$	12,398,543

	At December 31, 2012
	Past Due
	30-59		60-89		90 Days		Total
(In Thousands)	Days		Days		or More		Past Due		Current		Total
Accruing loans:
Mortgage loans (gross):
Residential:
Full documentation interest-only	$	30,520	$	8,973	$	—	$	39,493	$	1,862,382	$	1,901,875
Full documentation amortizing	35,918		6,564		—		42,482		6,218,064		6,260,546
Reduced documentation interest-only	28,212		7,694		—		35,906		855,907		891,813
Reduced documentation amortizing	11,780		3,893		—		15,673		350,268		365,941
Total residential	106,430		27,124		—		133,554		9,286,621		9,420,175
Multi-family	21,743		5,382		—		27,125		2,368,895		2,396,020
Commercial real estate	13,536		3,126		328		16,990		750,385		767,375
Total mortgage loans	141,709		35,632		328		177,669		12,405,901		12,583,570
Consumer and other loans (gross):
Home equity lines of credit	3,103		1,092		—		4,195		221,266		225,461
Other	120		223		—		343		31,782		32,125
Total consumer and other loans	3,223		1,315		—		4,538		253,048		257,586
Total accruing loans	$	144,932	$	36,947	$	328	$	182,207	$	12,658,949	$	12,841,156
Non-accrual loans:
Mortgage loans (gross):
Residential:
Full documentation interest-only	$	—	$	677	$	97,907	$	98,584	$	937	$	99,521
Full documentation amortizing	363		—		43,014		43,377		949		44,326
Reduced documentation interest-only	1,042		—		107,254		108,296		5,186		113,482
Reduced documentation amortizing	445		13		32,496		32,954		768		33,722
Total residential	1,850		690		280,671		283,211		7,840		291,051
Multi-family	—		—		7,359		7,359		3,299		10,658
Commercial real estate	—		—		6,541		6,541		—		6,541
Total mortgage loans	1,850		690		294,571		297,111		11,139		308,250
Consumer and other loans (gross):
Home equity lines of credit	—		—		6,459		6,459		—		6,459
Other	—		—		49		49		—		49
Total consumer and other loans	—		—		6,508		6,508		—		6,508
Total non-accrual loans	$	1,850	$	690	$	301,079	$	303,619	$	11,139	$	314,758
Total loans:
Mortgage loans (gross):
Residential:
Full documentation interest-only	$	30,520	$	9,650	$	97,907	$	138,077	$	1,863,319	$	2,001,396
Full documentation amortizing	36,281		6,564		43,014		85,859		6,219,013		6,304,872
Reduced documentation interest-only	29,254		7,694		107,254		144,202		861,093		1,005,295
Reduced documentation amortizing	12,225		3,906		32,496		48,627		351,036		399,663
Total residential	108,280		27,814		280,671		416,765		9,294,461		9,711,226
Multi-family	21,743		5,382		7,359		34,484		2,372,194		2,406,678
Commercial real estate	13,536		3,126		6,869		23,531		750,385		773,916
Total mortgage loans	143,559		36,322		294,899		474,780		12,417,040		12,891,820
Consumer and other loans (gross):
Home equity lines of credit	3,103		1,092		6,459		10,654		221,266		231,920
Other	120		223		49		392		31,782		32,174
Total consumer and other loans	3,223		1,315		6,508		11,046		253,048		264,094
Total loans	$	146,782	$	37,637	$	301,407	$	485,826	$	12,670,088	$	13,155,914
Net unamortized premiums and deferred loan origination costs											68,058
Loans receivable											13,223,972
Allowance for loan losses											(145,501		)
Loans receivable, net											$	13,078,471

We segment our residential mortgage loan portfolio by interest-only and amortizing loans, full documentation and reduced documentation loans and year of origination and analyze our historical loss experience and delinquency levels and trends of these segments.  We analyze multi-family and commercial real estate loans by portfolio, geographic location and year of origination.  We analyze our consumer and other loan portfolio by home equity lines of credit, commercial loans, revolving credit lines and installment loans and perform similar historical loss analyses.

Effective in the 2013 first quarter, in addition to residential loans discharged in a Chapter 7 bankruptcy filing, or bankruptcy loans, placed on non-accrual status and reported as non-performing loans as of December 31, 2012, we also included bankruptcy loans discharged prior to 2012 regardless of the delinquency status of the loans, which resulted in an increase in non-performing loans at September 30, 2013 compared to December 31, 2012.  Non-performing loans at September 30, 2013 included $64.3 million of bankruptcy loans which were current or less than 90 days past due, including $49.9 million which were discharged prior to 2012.  Of the bankruptcy loans which were current or less than 90 days past due at September 30, 2013, $57.8 million were current, $5.9 million were 30-59 days past due and $535,000 were 60-89 days past due.  Such loans continue to generate interest income on a cash basis as payments are received.  Pursuant to regulatory guidance issued in 2012, bankruptcy loans, in addition to being placed on non-accrual status and reported as non-performing loans, are also reported as loans modified in a troubled debt restructuring, or TDR, and as impaired loans; such loans totaled $88.0 million at September 30, 2013, including bankruptcy loans discharged prior to 2012 of $66.3 million.

We analyze our historical loss experience over twelve, fifteen, eighteen and twenty-four month periods.  The loss history used in calculating our quantitative allowance coverage percentages varies based on loan type.  Also, for a particular loan type we may not have sufficient loss history to develop a reasonable estimate of loss and consider our loss experience for other, similar loan types and may evaluate those losses over a longer period than two years.  Additionally, multi-family and commercial real estate loss experience may be adjusted based on the composition of the losses (loan sales, short sales and partial charge-offs).  We update our historical loss analyses quarterly and evaluate the need to modify our quantitative allowances as a result of our updated charge-off and loss analyses.  In the 2013 third quarter, we further updated the method of determining our allowance level by (1) extending our evaluation of loss experience factors to consider trends in such factors over the prior two years for the majority of the loan portfolio, and (2) giving consideration to more detailed modeling techniques as an added factor for multi-family and commercial real estate loans originated since 2010.  We also consider qualitative factors with the purpose of assessing the adequacy of the overall allowance for loan losses as well as the allocation of the allowance for loan losses by portfolio.

Allowance adequacy calculations are adjusted quarterly, based on the results of our quantitative and qualitative analyses, to reflect our current estimates of the amount of probable losses inherent in our loan portfolio in determining our allowance for loan losses.  Beginning with the 2013 first quarter, the allowance for loan losses allocated to residential mortgage loans over 180 days delinquent with a charge-off, previously determined within our qualitative analysis, is now determined within our quantitative analysis and presented as attributable to those loans individually evaluated for impairment.  The portion of the allowance allocated to each loan category does not represent the total available to absorb losses which may occur within the loan category, since the total allowance for loan losses is available for losses applicable to the entire loan portfolio.

The following tables set forth the changes in our allowance for loan losses by loan receivable segment for the periods indicated.

	For the Three Months Ended September 30, 2013
	Mortgage Loans						Consumer
(In Thousands)	Residential		Multi-Family		CommercialReal Estate		and OtherLoans		Total
Balance at July 1, 2013	$	78,788	$	40,865	$	16,642	$	7,605	$	143,900
Provision charged (credited) to operations	7,659		(2,521)		(2,592)		(5)		2,541
Charge-offs	(5,560)		(99)		(293)		(544)		(6,496		)
Recoveries	2,537		—		247		271		3,055
Balance at September 30, 2013	$	83,424	$	38,245	$	14,004	$	7,327	$	143,000

	For the Nine Months Ended September 30, 2013
	Mortgage Loans						Consumer
(In Thousands)	Residential		Multi-Family		CommercialReal Estate		and OtherLoans		Total
Balance at January 1, 2013	$	89,267	$	35,514	$	14,404	$	6,316	$	145,501
Provision charged to operations	7,488		5,131		1,378		2,196		16,193
Charge-offs	(20,332)		(3,637)		(2,313)		(1,672)		(27,954		)
Recoveries	7,001		1,237		535		487		9,260
Balance at September 30, 2013	$	83,424	$	38,245	$	14,004	$	7,327	$	143,000

	For the Three Months Ended September 30, 2012
	Mortgage Loans						Consumer
(In Thousands)	Residential		Multi-Family		CommercialReal Estate		and OtherLoans		Total
Balance at July 1, 2012	$	87,394	$	48,142	$	9,109	$	3,457	$	148,102
Provision charged (credited) to operations	9,210		(6,168)		3,828		2,630		9,500
Charge-offs	(8,195)		(1,233)		(1,379)		(891)		(11,698		)
Recoveries	2,355		122		—		91		2,568
Balance at September 30, 2012	$	90,764	$	40,863	$	11,558	$	5,287	$	148,472

	For the Nine Months Ended September 30, 2012
	Mortgage Loans						Consumer
(In Thousands)	Residential		Multi-Family		CommercialReal Estate		and OtherLoans		Total
Balance at January 1, 2012	$	105,991	$	35,422	$	11,972	$	3,800	$	157,185
Provision charged to operations	16,387		8,381		1,303		3,429		29,500
Charge-offs	(37,598)		(3,139)		(1,718)		(2,367)		(44,822		)
Recoveries	5,984		199		1		425		6,609
Balance at September 30, 2012	$	90,764	$	40,863	$	11,558	$	5,287	$	148,472

The following table sets forth the balances of our residential interest-only mortgage loans at September 30, 2013 by the period in which such loans are scheduled to enter their amortization period.

(In Thousands)	Recorded Investment
Amortization scheduled to begin:
Within one year	$	229,445
More than one year to three years	1,334,544
More than three years to five years	769,974
Over five years	71,420
Total	$	2,405,383

The following tables set forth the balances of our residential mortgage and consumer and other loan receivable segments by class and credit quality indicator at the dates indicated.

	At September 30, 2013
	Residential Mortgage Loans								Consumer and Other Loans
	Full Documentation				Reduced Documentation				Home Equity
(In Thousands)	Interest-only		Amortizing		Interest-only		Amortizing		Lines of Credit		Other
Performing	$	1,417,153	$	5,448,483	$	755,022	$	359,442	$	200,044	$	37,595
Non-performing:
Current or past due less than 90 days	23,665		10,247		33,435		6,380		32		—
Past due 90 days or more	85,019		42,294		91,089		26,289		6,441		33
Total	$	1,525,837	$	5,501,024	$	879,546	$	392,111	$	206,517	$	37,628

	At December 31, 2012
	Residential Mortgage Loans								Consumer and Other Loans
	Full Documentation				Reduced Documentation				Home Equity
(In Thousands)	Interest-only		Amortizing		Interest-only		Amortizing		Lines of Credit		Other
Performing	$	1,901,875	$	6,260,546	$	891,813	$	365,941	$	225,461	$	32,125
Non-performing:
Current or past due less than 90 days	1,614		1,312		6,228		1,226		—		—
Past due 90 days or more	97,907		43,014		107,254		32,496		6,459		49
Total	$	2,001,396	$	6,304,872	$	1,005,295	$	399,663	$	231,920	$	32,174

The following table sets forth the balances of our multi-family and commercial real estate mortgage loan receivable segments by credit quality indicator at the dates indicated.

	At September 30, 2013				At December 31, 2012
(In Thousands)	Multi-Family		Commercial Real Estate		Multi-Family		Commercial Real Estate
Not criticized	$	3,027,701	$	774,515	$	2,271,006	$	706,334
Criticized:
Special mention	20,016		8,123		54,956		28,210
Substandard	70,297		40,182		80,716		39,372
Doubtful	—		—		—		—
Total	$	3,118,014	$	822,820	$	2,406,678	$	773,916

The following tables set forth the balances of our loans receivable and the related allowance for loan loss allocation by segment and by the impairment methodology followed in determining the allowance for loan losses at the dates indicated.

	At September 30, 2013
	Mortgage Loans						Consumer
(In Thousands)	Residential		Multi- Family		CommercialReal Estate		and OtherLoans		Total
Loans:
Individually evaluated for impairment	$	313,495	$	55,391	$	17,154	$	—	$	386,040
Collectively evaluated for impairment	7,985,023		3,062,623		805,666		244,145		12,097,457
Total loans	$	8,298,518	$	3,118,014	$	822,820	$	244,145	$	12,483,497
Allowance for loan losses:
Individually evaluated for impairment	$	22,265	$	2,179	$	322	$	—	$	24,766
Collectively evaluated for impairment	61,159		36,066		13,682		7,327		118,234
Total allowance for loan losses	$	83,424	$	38,245	$	14,004	$	7,327	$	143,000

	At December 31, 2012
	Mortgage Loans						Consumer
(In Thousands)	Residential		Multi-Family		CommercialReal Estate		and OtherLoans		Total
Loans:
Individually evaluated for impairment	$	272,146	$	56,116	$	18,644	$	—	$	346,906
Collectively evaluated for impairment	9,439,080		2,350,562		755,272		264,094		12,809,008
Total loans	$	9,711,226	$	2,406,678	$	773,916	$	264,094	$	13,155,914
Allowance for loan losses:
Individually evaluated for impairment	$	1,001	$	2,576	$	1,469	$	—	$	5,046
Collectively evaluated for impairment	88,266		32,938		12,935		6,316		140,455
Total allowance for loan losses	$	89,267	$	35,514	$	14,404	$	6,316	$	145,501

The following table summarizes information related to our impaired mortgage loans by segment and class at the dates indicated.

	At September 30, 2013									At December 31, 2012
(In Thousands)	UnpaidPrincipalBalance		RecordedInvestment		RelatedAllowance			Net Investment		UnpaidPrincipalBalance		RecordedInvestment		RelatedAllowance			Net Investment
With an allowance recorded:
Residential:
Full documentation interest-only	$	149,386	$	114,923	$	(7,797	)	$	107,126	$	10,740	$	10,740	$	(241	)	$	10,499
Full documentation amortizing	40,794		35,014		(2,550		)	32,464		6,122		6,122		(347		)	5,775
Reduced documentation interest-only	183,353		139,472		(9,564		)	129,908		12,893		12,893		(277		)	12,616
Reduced documentation amortizing	29,062		24,086		(2,354		)	21,732		3,889		3,889		(136		)	3,753
Multi-family	23,437		23,437		(2,179		)	21,258		19,704		19,704		(2,576		)	17,128
Commercial real estate	6,764		6,764		(322		)	6,442		10,835		10,835		(1,469		)	9,366
Without an allowance recorded:
Residential:
Full documentation interest-only	—		—		—			—		122,275		86,607		—			86,607
Full documentation amortizing	—		—		—			—		23,489		17,962		—			17,962
Reduced documentation interest-only	—		—		—			—		166,477		116,514		—			116,514
Reduced documentation amortizing	—		—		—			—		23,419		17,419		—			17,419
Multi-family	38,635		31,954		—			31,954		44,341		36,412		—			36,412
Commercial real estate	14,830		10,390		—			10,390		13,256		7,809		—			7,809
Total impaired loans	$	486,261	$	386,040	$	(24,766	)	$	361,274	$	457,440	$	346,906	$	(5,046	)	$	341,860

The following tables set forth the average recorded investment, interest income recognized and cash basis interest income related to our impaired mortgage loans by segment and class for the periods indicated.

	For the Three Months Ended September 30,
	2013						2012
(In Thousands)	Average Recorded Investment		Interest Income Recognized		Cash Basis Interest Income		Average Recorded Investment		Interest Income Recognized		Cash Basis Interest Income
With an allowance recorded:
Residential:
Full documentation interest-only	$	107,893	$	762	$	763	$	10,254	$	79	$	77
Full documentation amortizing	31,128		218		220		4,210		40		41
Reduced documentation interest-only	144,468		1,171		1,174		10,469		130		122
Reduced documentation amortizing	24,452		158		152		2,272		27		19
Multi-family	19,557		34		169		60,560		1,146		590
Commercial real estate	7,604		56		66		11,838		229		97
Without an allowance recorded:
Residential:
Full documentation interest-only	9,075		—		—		83,722		417		411
Full documentation amortizing	2,968		—		—		16,611		117		108
Reduced documentation interest-only	—		—		—		118,021		742		728
Reduced documentation amortizing	—		—		—		18,694		79		69
Multi-family	31,464		401		416		12,517		503		227
Commercial real estate	11,252		112		131		6,623		272		99
Total impaired loans	$	389,861	$	2,912	$	3,091	$	355,791	$	3,781	$	2,588

	For the Nine Months Ended September 30,
	2013						2012
(In Thousands)	Average Recorded Investment		Interest Income Recognized		Cash Basis Interest Income		Average Recorded Investment		Interest Income Recognized		Cash Basis Interest Income
With an allowance recorded:
Residential:
Full documentation interest-only	$	105,931	$	2,114	$	2,229	$	10,360	$	247	$	247
Full documentation amortizing	29,465		623		639		4,071		121		122
Reduced documentation interest-only	146,773		3,053		3,205		10,967		342		345
Reduced documentation amortizing	25,424		464		493		2,084		86		78
Multi-family	18,975		659		722		55,319		2,252		1,946
Commercial real estate	8,692		253		285		13,196		430		321
Without an allowance recorded:
Residential:
Full documentation interest-only	14,433		—		—		81,638		1,069		1,136
Full documentation amortizing	4,396		—		—		17,452		221		234
Reduced documentation interest-only	2,086		—		—		115,363		1,731		1,824
Reduced documentation amortizing	—		—		—		17,293		291		303
Multi-family	33,294		1,165		1,229		9,168		921		662
Commercial real estate	10,118		286		319		4,812		541		389
Total impaired loans	$	399,587	$	8,617	$	9,121	$	341,723	$	8,252	$	7,607

The following tables set forth information about our mortgage loans receivable by segment and class at September 30, 2013 and 2012 which were modified in a TDR during the periods indicated.

	Modifications During the Three Months Ended September 30,
	2013			2012
(Dollars In Thousands)	Number of Loans	Pre- Modification Recorded Investment	Recorded Investment at September 30, 2013	Number of Loans	Pre- Modification Recorded Investment	Recorded Investment at September 30, 2012
Residential:
Full documentation interest-only	7	$   2,128	$   2,127	2	$     355	$      354
Full documentation amortizing	1	161	161	3	805	786
Reduced documentation interest-only	10	3,107	3,096	5	2,693	2,690
Reduced documentation amortizing	2	387	386	—	—	—
Multi-family	5	3,967	3,774	—	—	—
Commercial real estate	4	6,488	5,458	3	3,437	3,325
Total	29	$ 16,238	$ 15,002	13	$  7,290	$   7,155

	Modifications During the Nine Months Ended September 30,
	2013			2012
(Dollars In Thousands)	Number of Loans	Pre- Modification Recorded Investment	Recorded Investment at September 30, 2013	Number of Loans	Pre- Modification Recorded Investment	Recorded Investment at September 30, 2012
Residential:
Full documentation interest-only	18	$   4,579	$   4,577	6	$   1,415	$   1,384
Full documentation amortizing	6	1,662	1,682	3	805	786
Reduced documentation interest-only	28	8,957	8,921	12	5,422	5,407
Reduced documentation amortizing	8	2,470	2,408	5	1,950	1,840
Multi-family	8	6,751	6,228	12	31,581	29,129
Commercial real estate	7	10,443	9,125	6	7,671	6,120
Total	75	$ 34,862	$ 32,941	44	$ 48,844	$ 44,666

The following table sets forth information about our mortgage loans receivable by segment and class at September 30, 2013 and 2012 which were modified in a TDR during the twelve months ended September 30, 2013 and 2012 and had a payment default subsequent to the modification during the periods indicated.

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2013		2012		2013		2012
(Dollars In Thousands)	Number of Loans	Recorded Investment at September 30, 2013	Number of Loans	Recorded Investment at September 30, 2012	Number of Loans	Recorded Investment at September 30, 2013	Number of Loans	Recorded Investment at September 30, 2012
Residential:
Full documentation interest-only	14	$    3,365	—	$        —	22	$    5,343	—	$        —
Full documentation amortizing	8	2,159	1	485	10	2,589	1	485
Reduced documentation interest-only	20	5,729	3	1,174	24	6,707	5	1,821
Reduced documentation amortizing	2	303	—	—	5	880	5	1,817
Multi-family	1	671	1	2,062	1	671	2	3,743
Total	45	$ 12,227	5	$  3,721	62	$  16,190	13	$    7,866

For additional information regarding our loans receivable and allowance for loan losses, see “Asset Quality” and “Critical Accounting Policies” in Part I, Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” or “MD&A.”

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Consolidated Statement of Changes in Stockholders' Equity (Parenthetical) (USD $)	9 Months Ended
	Sep. 30, 2013
Dividends on common stock (in dollars per share)	$ 0.12
Dividends on preferred stock (in dollars per share)	$ 37.19
Restricted stock grants, shares	536,110
Forfeitures of restricted stock, shares	90,306
Preferred Stock
Issuance of Preferred stock, Series C, shares	135,000

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Other Comprehensive Income/Loss (Details 2) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Net unrealized loss on securities available-for-sale before tax amount:
Net unrealized holding loss on securities available-for-sale arising during the period	$ (1,984)		$ (12,180)
Reclassification adjustment for gain on sales of securities included in net income			(2,057)
Net unrealized loss on securities available-for-sale			(14,237)
Net unrealized loss on securities available-for-sale, tax benefit (expense):
Net unrealized holding loss on securities available-for-sale arising during the period	698		4,291
Reclassification adjustment for gain on sales of securities included in net income			725
Net unrealized loss on securities available-for-sale			5,016
Net unrealized loss on securities available-for-sale:
Net unrealized holding loss on securities available-for-sale arising during the period	(1,286)	(3,796)	(7,889)	(3,194)
Reclassification adjustment for gain on sales of securities included in net income			(1,332)	(1,604)
Net unrealized loss on securities available-for-sale	(1,286)	(3,796)	(9,221)	(4,798)
Reclassification adjustment for net actuarial loss included in net income, Before Tax Amount	903		2,708
Reclassification adjustment for net actuarial loss included in net income, Tax Benefit (Expense)	(318)		(954)
Reclassification adjustment for net actuarial loss included in net income, After Tax Amount	585	448	1,754	3,077
Reclassification adjustment for prior service cost included in net income, Before Tax Amount	53		159
Reclassification adjustment for prior service cost included in net income, Tax Benefit (Expense)	(19)		(56)
Reclassification adjustment for prior service cost included in net income, After Tax Amount	34	32	103	67
Other Comprehensive loss, Before Tax Amount	(1,028)		(11,370)
Other Comprehensive loss, Tax Benefit (Expense)	361		4,006
Total other comprehensive (loss) income, net of tax	$ (667)	$ (3,260)	$ (7,364)	$ 19,246

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Borrowings (Details 3) (USD $)	Sep. 30, 2013	Dec. 31, 2012
Contractual maturities
Total borrowings, net	$ 4,109,028,000	$ 4,373,496,000
FHLB Advances | FHLB-NY
Contractual maturities
Twelve months or less	776,000,000
Thirteen to twenty-four months	100,000,000
Twenty-five to thirty-six months	750,000,000
Over sixty months	850,000,000
Total borrowings, net	2,476,000,000	2,897,000,000
Due overnight	176,000,000
Due in less than 30 days	350,000,000
Due in 30-90 days	100,000,000
Due after 90 days	150,000,000
Reverse repurchase agreements
Contractual maturities
Thirty-seven to forty-eight months	600,000,000
Forty-nine to sixty months	200,000,000
Over sixty months	300,000,000
Total borrowings, net	1,100,000,000	1,100,000,000
Callable within the next three months	100,000,000
Callable in 2016	100,000,000
Callable in 2017	$ 100,000,000

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Loans Receivable and Allowance for Loan Losses (Details) (USD $)	Sep. 30, 2013	Jun. 30, 2013	Dec. 31, 2012	Sep. 30, 2012	Jun. 30, 2012	Dec. 31, 2011
Loans receivable and allowance for loan losses
30-59 Days Past Due	$ 105,939,000		$ 146,782,000
60-89 Days Past Due	32,184,000		37,637,000
90 Days or More	263,355,000		301,407,000
Total Past Due	401,478,000		485,826,000
Current	12,082,019,000		12,670,088,000
Total loans	12,483,497,000		13,155,914,000
Net unamortized premiums and deferred loan origination costs	58,046,000		68,058,000
Loans receivable	12,541,543,000		13,223,972,000
Allowance for loan losses	(143,000,000)	(143,900,000)	(145,501,000)	(148,472,000)	(148,102,000)	(157,185,000)
Loans receivable, net	12,398,543,000		13,078,471,000
Accruing loans
Loans receivable and allowance for loan losses
30-59 Days Past Due	98,039,000		144,932,000
60-89 Days Past Due	29,037,000		36,947,000
90 Days or More	55,000		328,000
Total Past Due	127,131,000		182,207,000
Current	12,005,168,000		12,658,949,000
Total loans	12,132,299,000		12,841,156,000
Non-accrual loans
Loans receivable and allowance for loan losses
30-59 Days Past Due	7,900,000		1,850,000
60-89 Days Past Due	3,147,000		690,000
90 Days or More	263,300,000		301,079,000
Total Past Due	274,347,000		303,619,000
Current	76,851,000		11,139,000
Total loans	351,198,000		314,758,000
Mortgage Loans (Gross)
Loans receivable and allowance for loan losses
30-59 Days Past Due	103,306,000		143,559,000
60-89 Days Past Due	30,798,000		36,322,000
90 Days or More	256,881,000		294,899,000
Total Past Due	390,985,000		474,780,000
Current	11,848,367,000		12,417,040,000
Total loans	12,239,352,000		12,891,820,000
Mortgage Loans (Gross) | Accruing loans
Loans receivable and allowance for loan losses
30-59 Days Past Due	95,406,000		141,709,000
60-89 Days Past Due	27,651,000		35,632,000
90 Days or More	55,000		328,000
Total Past Due	123,112,000		177,669,000
Current	11,771,548,000		12,405,901,000
Total loans	11,894,660,000		12,583,570,000
Mortgage Loans (Gross) | Non-accrual loans
Loans receivable and allowance for loan losses
30-59 Days Past Due	7,900,000		1,850,000
60-89 Days Past Due	3,147,000		690,000
90 Days or More	256,826,000		294,571,000
Total Past Due	267,873,000		297,111,000
Current	76,819,000		11,139,000
Total loans	344,692,000		308,250,000
Mortgage Loans (Gross) | Residential
Loans receivable and allowance for loan losses
30-59 Days Past Due	93,315,000		108,280,000
60-89 Days Past Due	27,026,000		27,814,000
90 Days or More	244,691,000		280,671,000
Total Past Due	365,032,000		416,765,000
Current	7,933,486,000		9,294,461,000
Total loans	8,298,518,000		9,711,226,000
Allowance for loan losses	(83,424,000)	(78,788,000)	(89,267,000)	(90,764,000)	(87,394,000)	(105,991,000)
Mortgage Loans (Gross) | Residential | Accruing loans
Loans receivable and allowance for loan losses
30-59 Days Past Due	86,445,000		106,430,000
60-89 Days Past Due	25,179,000		27,124,000
Total Past Due	111,624,000		133,554,000
Current	7,868,476,000		9,286,621,000
Total loans	7,980,100,000		9,420,175,000
Mortgage Loans (Gross) | Residential | Non-accrual loans
Loans receivable and allowance for loan losses
30-59 Days Past Due	6,870,000		1,850,000
60-89 Days Past Due	1,847,000		690,000
90 Days or More	244,691,000		280,671,000
Total Past Due	253,408,000		283,211,000
Current	65,010,000		7,840,000
Total loans	318,418,000		291,051,000
Mortgage Loans (Gross) | Residential | Full documentation interest-only loans
Loans receivable and allowance for loan losses
30-59 Days Past Due	25,342,000		30,520,000
60-89 Days Past Due	6,327,000		9,650,000
90 Days or More	85,019,000		97,907,000
Total Past Due	116,688,000		138,077,000
Current	1,409,149,000		1,863,319,000
Total loans	1,525,837,000		2,001,396,000
Mortgage Loans (Gross) | Residential | Full documentation interest-only loans | Accruing loans
Loans receivable and allowance for loan losses
30-59 Days Past Due	23,479,000		30,520,000
60-89 Days Past Due	6,327,000		8,973,000
Total Past Due	29,806,000		39,493,000
Current	1,387,347,000		1,862,382,000
Total loans	1,417,153,000		1,901,875,000
Mortgage Loans (Gross) | Residential | Full documentation interest-only loans | Non-accrual loans
Loans receivable and allowance for loan losses
30-59 Days Past Due	1,863,000
60-89 Days Past Due			677,000
90 Days or More	85,019,000		97,907,000
Total Past Due	86,882,000		98,584,000
Current	21,802,000		937,000
Total loans	108,684,000		99,521,000
Mortgage Loans (Gross) | Residential | Full documentation amortizing loans
Loans receivable and allowance for loan losses
30-59 Days Past Due	30,293,000		36,281,000
60-89 Days Past Due	10,849,000		6,564,000
90 Days or More	42,294,000		43,014,000
Total Past Due	83,436,000		85,859,000
Current	5,417,588,000		6,219,013,000
Total loans	5,501,024,000		6,304,872,000
Mortgage Loans (Gross) | Residential | Full documentation amortizing loans | Accruing loans
Loans receivable and allowance for loan losses
30-59 Days Past Due	29,947,000		35,918,000
60-89 Days Past Due	9,623,000		6,564,000
Total Past Due	39,570,000		42,482,000
Current	5,408,913,000		6,218,064,000
Total loans	5,448,483,000		6,260,546,000
Mortgage Loans (Gross) | Residential | Full documentation amortizing loans | Non-accrual loans
Loans receivable and allowance for loan losses
30-59 Days Past Due	346,000		363,000
60-89 Days Past Due	1,226,000
90 Days or More	42,294,000		43,014,000
Total Past Due	43,866,000		43,377,000
Current	8,675,000		949,000
Total loans	52,541,000		44,326,000
Mortgage Loans (Gross) | Residential | Reduced documentation interest-only loans
Loans receivable and allowance for loan losses
30-59 Days Past Due	27,513,000		29,254,000
60-89 Days Past Due	7,724,000		7,694,000
90 Days or More	91,089,000		107,254,000
Total Past Due	126,326,000		144,202,000
Current	753,220,000		861,093,000
Total loans	879,546,000		1,005,295,000
Mortgage Loans (Gross) | Residential | Reduced documentation interest-only loans | Accruing loans
Loans receivable and allowance for loan losses
30-59 Days Past Due	24,384,000		28,212,000
60-89 Days Past Due	7,232,000		7,694,000
Total Past Due	31,616,000		35,906,000
Current	723,406,000		855,907,000
Total loans	755,022,000		891,813,000
Mortgage Loans (Gross) | Residential | Reduced documentation interest-only loans | Non-accrual loans
Loans receivable and allowance for loan losses
30-59 Days Past Due	3,129,000		1,042,000
60-89 Days Past Due	492,000
90 Days or More	91,089,000		107,254,000
Total Past Due	94,710,000		108,296,000
Current	29,814,000		5,186,000
Total loans	124,524,000		113,482,000
Mortgage Loans (Gross) | Residential | Reduced documentation amortizing loans
Loans receivable and allowance for loan losses
30-59 Days Past Due	10,167,000		12,225,000
60-89 Days Past Due	2,126,000		3,906,000
90 Days or More	26,289,000		32,496,000
Total Past Due	38,582,000		48,627,000
Current	353,529,000		351,036,000
Total loans	392,111,000		399,663,000
Mortgage Loans (Gross) | Residential | Reduced documentation amortizing loans | Accruing loans
Loans receivable and allowance for loan losses
30-59 Days Past Due	8,635,000		11,780,000
60-89 Days Past Due	1,997,000		3,893,000
Total Past Due	10,632,000		15,673,000
Current	348,810,000		350,268,000
Total loans	359,442,000		365,941,000
Mortgage Loans (Gross) | Residential | Reduced documentation amortizing loans | Non-accrual loans
Loans receivable and allowance for loan losses
30-59 Days Past Due	1,532,000		445,000
60-89 Days Past Due	129,000		13,000
90 Days or More	26,289,000		32,496,000
Total Past Due	27,950,000		32,954,000
Current	4,719,000		768,000
Total loans	32,669,000		33,722,000
Mortgage Loans (Gross) | Multi-Family
Loans receivable and allowance for loan losses
30-59 Days Past Due	9,991,000		21,743,000
60-89 Days Past Due	1,811,000		5,382,000
90 Days or More	11,037,000		7,359,000
Total Past Due	22,839,000		34,484,000
Current	3,095,175,000		2,372,194,000
Total loans	3,118,014,000		2,406,678,000
Allowance for loan losses	(38,245,000)	(40,865,000)	(35,514,000)	(40,863,000)	(48,142,000)	(35,422,000)
Mortgage Loans (Gross) | Multi-Family | Accruing loans
Loans receivable and allowance for loan losses
30-59 Days Past Due	8,961,000		21,743,000
60-89 Days Past Due	1,448,000		5,382,000
Total Past Due	10,409,000		27,125,000
Current	3,091,944,000		2,368,895,000
Total loans	3,102,353,000		2,396,020,000
Mortgage Loans (Gross) | Multi-Family | Non-accrual loans
Loans receivable and allowance for loan losses
30-59 Days Past Due	1,030,000
60-89 Days Past Due	363,000
90 Days or More	11,037,000		7,359,000
Total Past Due	12,430,000		7,359,000
Current	3,231,000		3,299,000
Total loans	15,661,000		10,658,000
Mortgage Loans (Gross) | Commercial Real Estate
Loans receivable and allowance for loan losses
30-59 Days Past Due			13,536,000
60-89 Days Past Due	1,961,000		3,126,000
90 Days or More	1,153,000		6,869,000
Total Past Due	3,114,000		23,531,000
Current	819,706,000		750,385,000
Total loans	822,820,000		773,916,000
Allowance for loan losses	(14,004,000)	(16,642,000)	(14,404,000)	(11,558,000)	(9,109,000)	(11,972,000)
Mortgage Loans (Gross) | Commercial Real Estate | Accruing loans
Loans receivable and allowance for loan losses
30-59 Days Past Due			13,536,000
60-89 Days Past Due	1,024,000		3,126,000
90 Days or More	55,000		328,000
Total Past Due	1,079,000		16,990,000
Current	811,128,000		750,385,000
Total loans	812,207,000		767,375,000
Mortgage Loans (Gross) | Commercial Real Estate | Non-accrual loans
Loans receivable and allowance for loan losses
60-89 Days Past Due	937,000
90 Days or More	1,098,000		6,541,000
Total Past Due	2,035,000		6,541,000
Current	8,578,000
Total loans	10,613,000		6,541,000
Consumer and Other Loans
Loans receivable and allowance for loan losses
30-59 Days Past Due	2,633,000		3,223,000
60-89 Days Past Due	1,386,000		1,315,000
90 Days or More	6,474,000		6,508,000
Total Past Due	10,493,000		11,046,000
Current	233,652,000		253,048,000
Total loans	244,145,000		264,094,000
Allowance for loan losses	(7,327,000)	(7,605,000)	(6,316,000)	(5,287,000)	(3,457,000)	(3,800,000)
Consumer and Other Loans | Accruing loans
Loans receivable and allowance for loan losses
30-59 Days Past Due	2,633,000		3,223,000
60-89 Days Past Due	1,386,000		1,315,000
Total Past Due	4,019,000		4,538,000
Current	233,620,000		253,048,000
Total loans	237,639,000		257,586,000
Consumer and Other Loans | Non-accrual loans
Loans receivable and allowance for loan losses
90 Days or More	6,474,000		6,508,000
Total Past Due	6,474,000		6,508,000
Current	32,000
Total loans	6,506,000		6,508,000
Consumer and Other Loans | Home equity lines of credit
Loans receivable and allowance for loan losses
30-59 Days Past Due	2,573,000		3,103,000
60-89 Days Past Due	1,350,000		1,092,000
90 Days or More	6,441,000		6,459,000
Total Past Due	10,364,000		10,654,000
Current	196,153,000		221,266,000
Total loans	206,517,000		231,920,000
Consumer and Other Loans | Home equity lines of credit | Accruing loans
Loans receivable and allowance for loan losses
30-59 Days Past Due	2,573,000		3,103,000
60-89 Days Past Due	1,350,000		1,092,000
Total Past Due	3,923,000		4,195,000
Current	196,121,000		221,266,000
Total loans	200,044,000		225,461,000
Consumer and Other Loans | Home equity lines of credit | Non-accrual loans
Loans receivable and allowance for loan losses
90 Days or More	6,441,000		6,459,000
Total Past Due	6,441,000		6,459,000
Current	32,000
Total loans	6,473,000		6,459,000
Consumer and Other Loans | Other Loans
Loans receivable and allowance for loan losses
30-59 Days Past Due	60,000		120,000
60-89 Days Past Due	36,000		223,000
90 Days or More	33,000		49,000
Total Past Due	129,000		392,000
Current	37,499,000		31,782,000
Total loans	37,628,000		32,174,000
Consumer and Other Loans | Other Loans | Accruing loans
Loans receivable and allowance for loan losses
30-59 Days Past Due	60,000		120,000
60-89 Days Past Due	36,000		223,000
Total Past Due	96,000		343,000
Current	37,499,000		31,782,000
Total loans	37,595,000		32,125,000
Consumer and Other Loans | Other Loans | Non-accrual loans
Loans receivable and allowance for loan losses
90 Days or More	33,000		49,000
Total Past Due	33,000		49,000
Total loans	$ 33,000		$ 49,000

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Fair Value Measurements (Details 3) (Measured on a non-recurring basis, USD $) In Thousands, unless otherwise specified	9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012
Fair Value of Financial Instruments
Losses recognized on assets measured at fair value on a non-recurring basis	$ 19,895	$ 36,433
Non-performing loans held-for-sale, net
Fair Value of Financial Instruments
Losses recognized on assets measured at fair value on a non-recurring basis	567	696
Impaired loans
Fair Value of Financial Instruments
Losses recognized on assets measured at fair value on a non-recurring basis	16,698	31,555
MSR, net
Fair Value of Financial Instruments
Losses recognized on assets measured at fair value on a non-recurring basis		1,089
REO, net
Fair Value of Financial Instruments
Losses recognized on assets measured at fair value on a non-recurring basis	$ 2,630	$ 3,093

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Fair Value Measurements

9 Months Ended

Sep. 30, 2013

Fair Value Measurements

Fair Value Measurements

11. Fair Value Measurements

We use fair value measurements to record fair value adjustments to certain assets and liabilities and to determine fair value disclosures.  We group our assets and liabilities at fair value in three levels, based on the markets in which the assets are traded and the reliability of the assumptions used to determine fair value.  These levels are:

· Level 1 – Valuation is based upon quoted prices for identical instruments traded in active markets.

· Level 2 – Valuation is based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model-based valuation techniques for which all significant assumptions are observable in the market.

· Level 3 – Valuation is generated from model-based techniques that use significant assumptions not observable in the market. These unobservable assumptions reflect our own estimates of assumptions that market participants would use in pricing the asset or liability. Valuation techniques include the use of option pricing models, discounted cash flow models and similar techniques. The results cannot be determined with precision and may not be realized in an actual sale or immediate settlement of the asset or liability.

We base our fair values on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, with additional considerations when the volume and level of activity for an asset or liability have significantly decreased and on identifying circumstances that indicate a transaction is not orderly.  We maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.

Recurring Fair Value Measurements

Our securities available-for-sale portfolio is carried at estimated fair value on a recurring basis, with any unrealized gains and losses, net of taxes, reported as accumulated other comprehensive income/loss in stockholders’ equity.  Additionally, in connection with our mortgage banking activities we have commitments to fund loans held-for-sale and commitments to sell loans, which are considered free-standing derivative instruments, the fair values of which are not material to our financial condition or results of operations.

The following tables set forth the carrying values of our assets measured at fair value on a recurring basis and the level within the fair value hierarchy in which the fair value measurements fall at the dates indicated.

	Carrying Value at September 30, 2013
(In Thousands)	Total	Level 1		Level 2
Securities available-for-sale:
Residential mortgage-backed securities:
GSE issuance REMICs and CMOs	$  296,966	$	—	$  296,966
Non-GSE issuance REMICs and CMOs	8,396	—		8,396
GSE pass-through certificates	17,957	—		17,957
Obligations of GSEs	92,430	—		92,430
Fannie Mae stock	1	1		—
Total securities available-for-sale	$  415,750	$	1	$  415,749

	Carrying Value at December 31, 2012
(In Thousands)	Total	Level 1		Level 2
Securities available-for-sale:
Residential mortgage-backed securities:
GSE issuance REMICs and CMOs	$  204,827	$	—	$  204,827
Non-GSE issuance REMICs and CMOs	11,219	—		11,219
GSE pass-through certificates	21,375	—		21,375
Obligations of GSEs	98,879	—		98,879
Fannie Mae stock	—	—		—
Total securities available-for-sale	$  336,300	$	—	$  336,300

The following is a description of valuation methodologies used for assets measured at fair value on a recurring basis.

Residential mortgage-backed securities

Residential mortgage-backed securities comprised 78% of our securities available-for-sale portfolio at September 30, 2013 and 71% at December 31, 2012.  The fair values for these securities are obtained from an independent nationally recognized pricing service.  Our pricing service uses various modeling techniques to determine pricing for our mortgage-backed securities, including option pricing and discounted cash flow models.  The inputs to these models include benchmark yields, reported trades, broker/dealer quotes, issuer spreads, benchmark securities, bids, offers, reference data, monthly payment information and collateral performance.  GSE securities, for which an active market exists for similar securities making observable inputs readily available, comprised 97% of our available-for-sale residential mortgage-backed securities portfolio at September 30, 2013 and 95% at December 31, 2012.

We review changes in the pricing service fair values from month to month taking into consideration changes in market conditions including changes in mortgage spreads, changes in treasury yields and changes in generic pricing on fifteen and thirty year securities.  Significant month over month price changes are analyzed further using discounted cash flow models and, on occasion, third party quotes.  Based upon our review of the prices provided by our pricing service, the estimated fair values incorporate observable market inputs commonly used by buyers and sellers of these types of securities at the measurement date in orderly transactions between market participants, and, as such, are classified as Level 2.

Obligations of GSEs

Obligations of GSEs comprised 22% of our securities available-for-sale portfolio at September 30, 2013 and 29% at December 31, 2012 and consisted of debt securities issued by GSEs.  The fair values for these securities are obtained from an independent nationally recognized pricing service.  Our pricing service gathers information from market sources and integrates relative credit information, observed market movements and sector news into their pricing applications and models.  Spread scales, representing credit risk, are created and are based on the new issue market, secondary trading and dealer quotes.  Option adjusted spread, or OAS, models are incorporated to adjust spreads of issues that have early redemption features.  Based upon our review of the prices provided by our pricing service, the estimated fair values incorporate observable market inputs commonly used by buyers and sellers of these types of securities at the measurement date in orderly transactions between market participants, and, as such, are classified as Level 2.

Fannie Mae stock

The fair value of the Fannie Mae stock in our available-for-sale securities portfolio is obtained from quoted market prices for identical instruments in active markets and, as such, is classified as Level 1.

Non-Recurring Fair Value Measurements

From time to time, we may be required to record at fair value assets or liabilities on a non-recurring basis, such as mortgage servicing rights, or MSR, loans receivable, certain assets held-for-sale and real estate owned, or REO.  These non-recurring fair value adjustments involve the application of lower of cost or market accounting or impairment write-downs of individual assets.

The following table sets forth the carrying values of those of our assets which were measured at fair value on a non-recurring basis at the dates indicated.  The fair value measurements for all of these assets fall within Level 3 of the fair value hierarchy.

	Carrying Value
(In Thousands)	At September 30, 2013	At December 31, 2012
Non-performing loans held-for-sale, net	$        884	$     3,881
Impaired loans	265,698	282,723
MSR, net	10,835	6,947
REO, net	20,903	20,796
Total	$ 298,320	$ 314,347

The following table provides information regarding the losses recognized on our assets measured at fair value on a non-recurring basis for the periods indicated.

	For the Nine Months Ended September 30,
(In Thousands)	2013	2012
Non-performing loans held-for-sale, net (1)	$     567	$     696
Impaired loans (2)	16,698	31,555
MSR, net (3)	—	1,089
REO, net (4)	2,630	3,093
Total	$  19,895	$  36,433

(1)	Losses are charged against the allowance for loan losses in the case of a write-down upon the reclassification of a loan to held-for-sale. Losses subsequent to the reclassification of a loan to held-for-sale are charged to other non-interest income.
(2)	Losses are charged against the allowance for loan losses.
(3)	Losses are charged to mortgage banking income, net.
(4)	Losses are charged against the allowance for loan losses in the case of a write-down upon the transfer of a loan to REO. Losses subsequent to the transfer of a loan to REO are charged to REO expense which is a component of other non-interest expense.

The following is a description of valuation methodologies used for assets measured at fair value on a non-recurring basis.

Loans-held-for-sale, net (non-performing loans held-for-sale)

Fair values of non-performing loans held-for-sale are estimated through either preliminary bids from potential purchasers of the loans or the estimated fair value of the underlying collateral discounted for factors necessary to solicit acceptable bids, and adjusted as necessary based on management’s experience with sales of similar types of loans and, as such, are classified as Level 3.  Non-performing loans held-for-sale were comprised primarily of multi-family mortgage loans at September 30, 2013.  Substantially all of the non-performing loans held-for-sale were multi-family mortgage loans at December 31, 2012.

Loans receivable, net (impaired loans)

Loans which meet certain criteria are evaluated individually for impairment.  A loan is considered impaired when, based upon current information and events, it is probable that we will be unable to collect all amounts due, including principal and interest, according to the contractual terms of the loan agreement.  Impaired loans were comprised of 81% residential mortgage loans and 19% multi-family and commercial real estate mortgage loans at September 30, 2013 and 78% residential mortgage loans and 22% multi-family and commercial real estate mortgage loans at December 31, 2012.  Impaired loans for which a fair value adjustment was recognized were comprised of 84% residential mortgage loans and 16% multi-family and commercial real estate mortgage loans at September 30, 2013 and December 31, 2012.  Our impaired loans are generally collateral dependent and, as such, are generally carried at the estimated fair value of the collateral less estimated selling costs.

We obtain updated estimates of collateral values on residential mortgage loans at 180 days past due and earlier in certain instances, including for loans to borrowers who have filed for bankruptcy, and, to the extent the loans remain delinquent, annually thereafter.  Updated estimates of collateral value on residential loans are obtained primarily through automated valuation models.  Additionally, our loan servicer performs property inspections to monitor and manage the collateral on our residential loans when they become 45 days past due and monthly thereafter until the foreclosure process is complete.  We obtain updated estimates of collateral value using third party appraisals on non-performing multi-family and commercial real estate loans when the loans initially become non-performing and annually thereafter and multi-family and commercial real estate loans modified in a TDR at the time of the modification and annually thereafter.  Appraisals on multi-family and commercial real estate loans are reviewed by our internal certified appraisers.  Adjustments to final appraised values obtained from independent third party appraisers and automated valuation models are not made.  The fair values of impaired loans cannot be determined with precision and may not be realized in an actual sale or immediate settlement of the loan and, as such, are classified as Level 3.

MSR, net

The right to service loans for others is generally obtained through the sale of residential mortgage loans with servicing retained.  MSR are carried at the lower of cost or estimated fair value.  The estimated fair value of MSR is obtained through independent third party valuations through an analysis of future cash flows, incorporating estimates of assumptions market participants would use in determining fair value including market discount rates, prepayment speeds, servicing income, servicing costs, default rates and other market driven data, including the market’s perception of future interest rate movements and, as such, are classified as Level 3.  At September 30, 2013, our MSR were valued based on expected future cash flows considering a weighted average discount rate of 10.42%, a weighted average constant prepayment rate on mortgages of 14.64% and a weighted average life of 5.2 years.  At December 31, 2012, our MSR were valued based on expected future cash flows considering a weighted average discount rate of 10.95%, a weighted average constant prepayment rate on mortgages of 23.12% and a weighted average life of 3.4 years.  Management reviews the assumptions used to estimate the fair value of MSR to ensure they reflect current and anticipated market conditions.

REO, net

REO represents real estate acquired as a result of foreclosure or by deed in lieu of foreclosure, all of which were residential properties at September 30, 2013 and December 31, 2012, and is carried, net of allowances for losses, at the lower of cost or fair value less estimated selling costs.  The fair value of REO is estimated through current appraisals, in conjunction with a drive-by inspection and comparison of the REO property with similar properties in the area by either a licensed appraiser or real estate broker.  As these properties are actively marketed, estimated fair values are periodically adjusted by management to reflect current market conditions and, as such, are classified as Level 3.

Fair Value of Financial Instruments

Quoted market prices available in formal trading marketplaces are typically the best evidence of the fair value of financial instruments.  In many cases, financial instruments we hold are not bought or sold in formal trading marketplaces.  Accordingly, fair values are derived or estimated based on a variety of valuation techniques in the absence of quoted market prices.  Fair value estimates are made at a specific point in time, based on relevant market information about the financial instrument.  These estimates do not reflect any possible tax ramifications, estimated transaction costs, or any premium or discount that could result from offering for sale at one time our entire holdings of a particular financial instrument.  Because no market exists for a certain portion of our financial instruments, fair value estimates are based on judgments regarding future loss experience, current economic conditions, risk characteristics and other such factors.  These estimates are subjective in nature, involve uncertainties and, therefore, cannot be determined with precision.  Changes in assumptions could significantly affect the estimates.  For these reasons and others, the estimated fair value disclosures presented herein do not represent our entire underlying value.  As such, readers are cautioned in using this information for purposes of evaluating our financial condition and/or value either alone or in comparison with any other company.

The following tables set forth the carrying values and estimated fair values of our financial instruments which are carried on the consolidated statements of financial condition at either cost or at lower of cost or fair value in accordance with GAAP, and are not measured or recorded at fair value on a recurring basis, and the level within the fair value hierarchy in which the fair value measurements fall at the dates indicated.

	At September 30, 2013
	Carrying		Estimated Fair Value
(In Thousands)	Value		Total		Level 2		Level 3
Financial Assets:
Securities held-to-maturity	$	1,915,461	$	1,896,771	$	1,896,771	$	—
FHLB-NY stock	153,217		153,217		153,217		—
Loans held-for-sale, net (1)	10,485		10,866		—		10,866
Loans receivable, net (1)	12,398,543		12,630,027		—		12,630,027
MSR, net (1)	10,835		10,838		—		10,838
Financial Liabilities:
Deposits	10,060,374		10,140,390		10,140,390		—
Borrowings, net	4,109,028		4,374,578		4,374,578		—

(1) Includes assets measured at fair value on a non-recurring basis.

	At December 31, 2012
	Carrying		Estimated Fair Value
(In Thousands)	Value		Total		Level 2		Level 3
Financial Assets:
Securities held-to-maturity	$	1,700,141	$	1,725,090	$	1,725,090	$	—
FHLB-NY stock	171,194		171,194		171,194		—
Loans held-for-sale, net (1)	76,306		78,486		—		78,486
Loans receivable, net (1)	13,078,471		13,311,997		—		13,311,997
MSR, net (1)	6,947		6,948		—		6,948
Financial Liabilities:
Deposits	10,443,958		10,588,073		10,588,073		—
Borrowings, net	4,373,496		4,857,989		4,857,989		—

(1) Includes assets measured at fair value on a non-recurring basis.

The following is a description of the methods and assumptions used to estimate fair values of our financial instruments which are not measured or recorded at fair value on a recurring or non-recurring basis.

Securities held-to-maturity

The fair values for substantially all of our securities held-to-maturity are obtained from an independent nationally recognized pricing service using similar methods and assumptions as used for our securities available-for-sale which are measured at fair value on a recurring basis.

FHLB-NY stock

The fair value of FHLB-NY stock is based on redemption at par value.

Loans held-for-sale, net

The fair values of fifteen and thirty year conforming fixed rate residential mortgage loans originated for sale are estimated using an option-based pricing methodology designed to take into account interest rate volatility, which has a significant effect on the value of the options and structural features embedded in loans.  This methodology involves generating simulated interest rates, calculating the OAS of a mortgage-backed security whose price is known, which serves as a benchmark price, and using the benchmark OAS to estimate the pricing for similar mortgage instruments whose prices are not known.

Loans receivable, net

Fair values of loans are estimated using an option-based pricing methodology designed to take into account interest rate volatility, which has a significant effect on the value of the options and structural features embedded in loans.  This pricing methodology involves generating simulated interest rates, calculating the OAS of a mortgage-backed security whose price is known, which serves as a benchmark price, and using the benchmark OAS to estimate the pricing for similar mortgage instruments whose prices are not known.

This technique of estimating fair value is extremely sensitive to the assumptions and estimates used.  While we have attempted to use assumptions and estimates which are the most reflective of the loan portfolio and the current market, a greater degree of subjectivity is inherent in determining these fair values than for fair values obtained from formal trading marketplaces.  In addition, our valuation method for loans, which is consistent with accounting guidance, does not fully incorporate an exit price approach to fair value.

Deposits

The fair values of deposits with no stated maturity, such as savings, money market and NOW and demand deposit accounts, are equal to the amount payable on demand.  The fair values of certificates of deposit are based on discounted contractual cash flows using the weighted average remaining life of the portfolio discounted by the corresponding LIBOR Swap Curve.

Borrowings, net

The fair values of borrowings are based upon third party dealers’ estimated market values which are reviewed by management quarterly using an OAS model.

Outstanding commitments

Outstanding commitments include commitments to extend credit and unadvanced lines of credit for which fair values were estimated based on an analysis of the interest rates and fees currently charged to enter into similar transactions.  The fair values of these commitments are immaterial to our financial condition.

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Earnings Per Common Share

9 Months Ended

Sep. 30, 2013

Earnings Per Common Share

Earnings Per Common Share

7.     Earnings Per Common Share

The following table is a reconciliation of basic and diluted earnings per common share, or EPS.

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
(In Thousands, Except Share Data)	2013		2012		2013		2012
Net income	$ 16,924		$ 13,355		$ 46,441		$ 36,175
Preferred stock dividends	(2,194	)	—		(5,021	)	—
Net income available to common shareholders	14,730		13,355		41,420		36,175
Income allocated to participating securities	(195	)	(206	)	(508	)	(250	)
Net income allocated to common shareholders	$ 14,535		$ 13,149		$ 40,912		$ 35,925
Basic weighted average common shares outstanding	97,199,329		95,555,816		96,967,052		95,303,453
Dilutive effect of stock options (1)	—		—		—		—
Diluted weighted average common shares outstanding	97,199,329		95,555,816		96,967,052		95,303,453
Basic EPS	$ 0.15		$ 0.14		$ 0.42		$ 0.38
Diluted EPS	$ 0.15		$ 0.14		$ 0.42		$ 0.38

(1) Excludes options to purchase 1,871,935 shares of common stock which were outstanding during the three months ended September 30, 2013; options to purchase 5,452,028 shares of common stock which were outstanding during the three months ended September 30, 2012; options to purchase 2,215,820 shares of common stock which were outstanding during the nine months ended September 30, 2013; and options to purchase 5,674,912 shares of common stock which were outstanding during the nine months ended September 30, 2012 because their inclusion would be anti-dilutive.

For EPS computations, unvested shares of restricted common stock represent participating securities.  In contrast, unvested restricted stock units are treated as potential common shares with the dilutive effect calculated using the treasury stock method.  However, the unvested restricted stock units are excluded from the denominator for both the basic and diluted EPS computations until the performance conditions are satisfied.  As a result, unvested restricted stock units were excluded from the EPS computation for the three and nine months ended September 30, 2013.  There were no unvested restricted stock units outstanding during the three and nine months ended September 30, 2012.  See Note 10 for additional information about the restricted stock units granted in 2013.

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Loans Receivable and Allowance for Loan Losses (Tables)

9 Months Ended

Sep. 30, 2013

Loans Receivable and Allowance for Loan Losses

Schedule of composition of loans receivable portfolio and an aging analysis by accruing and non-accrual loans and by segment and class

	At September 30, 2013
	Past Due
	30-59		60-89		90 Days		Total
(In Thousands)	Days		Days		or More		Past Due		Current		Total
Accruing loans:
Mortgage loans (gross):
Residential:
Full documentation interest-only	$	23,479	$	6,327	$	—	$	29,806	$	1,387,347	$	1,417,153
Full documentation amortizing	29,947		9,623		—		39,570		5,408,913		5,448,483
Reduced documentation interest-only	24,384		7,232		—		31,616		723,406		755,022
Reduced documentation amortizing	8,635		1,997		—		10,632		348,810		359,442
Total residential	86,445		25,179		—		111,624		7,868,476		7,980,100
Multi-family	8,961		1,448		—		10,409		3,091,944		3,102,353
Commercial real estate	—		1,024		55		1,079		811,128		812,207
Total mortgage loans	95,406		27,651		55		123,112		11,771,548		11,894,660
Consumer and other loans (gross):
Home equity lines of credit	2,573		1,350		—		3,923		196,121		200,044
Other	60		36		—		96		37,499		37,595
Total consumer and other loans	2,633		1,386		—		4,019		233,620		237,639
Total accruing loans	$	98,039	$	29,037	$	55	$	127,131	$	12,005,168	$	12,132,299
Non-accrual loans:
Mortgage loans (gross):
Residential:
Full documentation interest-only	$	1,863	$	—	$	85,019	$	86,882	$	21,802	$	108,684
Full documentation amortizing	346		1,226		42,294		43,866		8,675		52,541
Reduced documentation interest-only	3,129		492		91,089		94,710		29,814		124,524
Reduced documentation amortizing	1,532		129		26,289		27,950		4,719		32,669
Total residential	6,870		1,847		244,691		253,408		65,010		318,418
Multi-family	1,030		363		11,037		12,430		3,231		15,661
Commercial real estate	—		937		1,098		2,035		8,578		10,613
Total mortgage loans	7,900		3,147		256,826		267,873		76,819		344,692
Consumer and other loans (gross):
Home equity lines of credit	—		—		6,441		6,441		32		6,473
Other	—		—		33		33		—		33
Total consumer and other loans	—		—		6,474		6,474		32		6,506
Total non-accrual loans	$	7,900	$	3,147	$	263,300	$	274,347	$	76,851	$	351,198
Total loans:
Mortgage loans (gross):
Residential:
Full documentation interest-only	$	25,342	$	6,327	$	85,019	$	116,688	$	1,409,149	$	1,525,837
Full documentation amortizing	30,293		10,849		42,294		83,436		5,417,588		5,501,024
Reduced documentation interest-only	27,513		7,724		91,089		126,326		753,220		879,546
Reduced documentation amortizing	10,167		2,126		26,289		38,582		353,529		392,111
Total residential	93,315		27,026		244,691		365,032		7,933,486		8,298,518
Multi-family	9,991		1,811		11,037		22,839		3,095,175		3,118,014
Commercial real estate	—		1,961		1,153		3,114		819,706		822,820
Total mortgage loans	103,306		30,798		256,881		390,985		11,848,367		12,239,352
Consumer and other loans (gross):
Home equity lines of credit	2,573		1,350		6,441		10,364		196,153		206,517
Other	60		36		33		129		37,499		37,628
Total consumer and other loans	2,633		1,386		6,474		10,493		233,652		244,145
Total loans	$	105,939	$	32,184	$	263,355	$	401,478	$	12,082,019	$	12,483,497
Net unamortized premiums and deferred loan origination costs											58,046
Loans receivable											12,541,543
Allowance for loan losses											(143,000		)
Loans receivable, net											$	12,398,543

	At December 31, 2012
	Past Due
	30-59		60-89		90 Days		Total
(In Thousands)	Days		Days		or More		Past Due		Current		Total
Accruing loans:
Mortgage loans (gross):
Residential:
Full documentation interest-only	$	30,520	$	8,973	$	—	$	39,493	$	1,862,382	$	1,901,875
Full documentation amortizing	35,918		6,564		—		42,482		6,218,064		6,260,546
Reduced documentation interest-only	28,212		7,694		—		35,906		855,907		891,813
Reduced documentation amortizing	11,780		3,893		—		15,673		350,268		365,941
Total residential	106,430		27,124		—		133,554		9,286,621		9,420,175
Multi-family	21,743		5,382		—		27,125		2,368,895		2,396,020
Commercial real estate	13,536		3,126		328		16,990		750,385		767,375
Total mortgage loans	141,709		35,632		328		177,669		12,405,901		12,583,570
Consumer and other loans (gross):
Home equity lines of credit	3,103		1,092		—		4,195		221,266		225,461
Other	120		223		—		343		31,782		32,125
Total consumer and other loans	3,223		1,315		—		4,538		253,048		257,586
Total accruing loans	$	144,932	$	36,947	$	328	$	182,207	$	12,658,949	$	12,841,156
Non-accrual loans:
Mortgage loans (gross):
Residential:
Full documentation interest-only	$	—	$	677	$	97,907	$	98,584	$	937	$	99,521
Full documentation amortizing	363		—		43,014		43,377		949		44,326
Reduced documentation interest-only	1,042		—		107,254		108,296		5,186		113,482
Reduced documentation amortizing	445		13		32,496		32,954		768		33,722
Total residential	1,850		690		280,671		283,211		7,840		291,051
Multi-family	—		—		7,359		7,359		3,299		10,658
Commercial real estate	—		—		6,541		6,541		—		6,541
Total mortgage loans	1,850		690		294,571		297,111		11,139		308,250
Consumer and other loans (gross):
Home equity lines of credit	—		—		6,459		6,459		—		6,459
Other	—		—		49		49		—		49
Total consumer and other loans	—		—		6,508		6,508		—		6,508
Total non-accrual loans	$	1,850	$	690	$	301,079	$	303,619	$	11,139	$	314,758
Total loans:
Mortgage loans (gross):
Residential:
Full documentation interest-only	$	30,520	$	9,650	$	97,907	$	138,077	$	1,863,319	$	2,001,396
Full documentation amortizing	36,281		6,564		43,014		85,859		6,219,013		6,304,872
Reduced documentation interest-only	29,254		7,694		107,254		144,202		861,093		1,005,295
Reduced documentation amortizing	12,225		3,906		32,496		48,627		351,036		399,663
Total residential	108,280		27,814		280,671		416,765		9,294,461		9,711,226
Multi-family	21,743		5,382		7,359		34,484		2,372,194		2,406,678
Commercial real estate	13,536		3,126		6,869		23,531		750,385		773,916
Total mortgage loans	143,559		36,322		294,899		474,780		12,417,040		12,891,820
Consumer and other loans (gross):
Home equity lines of credit	3,103		1,092		6,459		10,654		221,266		231,920
Other	120		223		49		392		31,782		32,174
Total consumer and other loans	3,223		1,315		6,508		11,046		253,048		264,094
Total loans	$	146,782	$	37,637	$	301,407	$	485,826	$	12,670,088	$	13,155,914
Net unamortized premiums and deferred loan origination costs											68,058
Loans receivable											13,223,972
Allowance for loan losses											(145,501		)
Loans receivable, net											$	13,078,471

Schedule of changes in allowance for loan losses by loan receivable segment

	For the Three Months Ended September 30, 2013
	Mortgage Loans						Consumer
(In Thousands)	Residential		Multi-Family		CommercialReal Estate		and OtherLoans		Total
Balance at July 1, 2013	$	78,788	$	40,865	$	16,642	$	7,605	$	143,900
Provision charged (credited) to operations	7,659		(2,521)		(2,592)		(5)		2,541
Charge-offs	(5,560)		(99)		(293)		(544)		(6,496		)
Recoveries	2,537		—		247		271		3,055
Balance at September 30, 2013	$	83,424	$	38,245	$	14,004	$	7,327	$	143,000

	For the Nine Months Ended September 30, 2013
	Mortgage Loans						Consumer
(In Thousands)	Residential		Multi-Family		CommercialReal Estate		and OtherLoans		Total
Balance at January 1, 2013	$	89,267	$	35,514	$	14,404	$	6,316	$	145,501
Provision charged to operations	7,488		5,131		1,378		2,196		16,193
Charge-offs	(20,332)		(3,637)		(2,313)		(1,672)		(27,954		)
Recoveries	7,001		1,237		535		487		9,260
Balance at September 30, 2013	$	83,424	$	38,245	$	14,004	$	7,327	$	143,000

	For the Three Months Ended September 30, 2012
	Mortgage Loans						Consumer
(In Thousands)	Residential		Multi-Family		CommercialReal Estate		and OtherLoans		Total
Balance at July 1, 2012	$	87,394	$	48,142	$	9,109	$	3,457	$	148,102
Provision charged (credited) to operations	9,210		(6,168)		3,828		2,630		9,500
Charge-offs	(8,195)		(1,233)		(1,379)		(891)		(11,698		)
Recoveries	2,355		122		—		91		2,568
Balance at September 30, 2012	$	90,764	$	40,863	$	11,558	$	5,287	$	148,472

	For the Nine Months Ended September 30, 2012
	Mortgage Loans						Consumer
(In Thousands)	Residential		Multi-Family		CommercialReal Estate		and OtherLoans		Total
Balance at January 1, 2012	$	105,991	$	35,422	$	11,972	$	3,800	$	157,185
Provision charged to operations	16,387		8,381		1,303		3,429		29,500
Charge-offs	(37,598)		(3,139)		(1,718)		(2,367)		(44,822		)
Recoveries	5,984		199		1		425		6,609
Balance at September 30, 2012	$	90,764	$	40,863	$	11,558	$	5,287	$	148,472

Schedule of balances of residential interest-only mortgage loans by scheduled amortization period

(In Thousands)	Recorded Investment
Amortization scheduled to begin:
Within one year	$	229,445
More than one year to three years	1,334,544
More than three years to five years	769,974
Over five years	71,420
Total	$	2,405,383

Schedule of balances of loans receivable and the related allowance for loan loss allocation by segment and by the impairment methodology followed

	At September 30, 2013
	Mortgage Loans						Consumer
(In Thousands)	Residential		Multi- Family		CommercialReal Estate		and OtherLoans		Total
Loans:
Individually evaluated for impairment	$	313,495	$	55,391	$	17,154	$	—	$	386,040
Collectively evaluated for impairment	7,985,023		3,062,623		805,666		244,145		12,097,457
Total loans	$	8,298,518	$	3,118,014	$	822,820	$	244,145	$	12,483,497
Allowance for loan losses:
Individually evaluated for impairment	$	22,265	$	2,179	$	322	$	—	$	24,766
Collectively evaluated for impairment	61,159		36,066		13,682		7,327		118,234
Total allowance for loan losses	$	83,424	$	38,245	$	14,004	$	7,327	$	143,000

	At December 31, 2012
	Mortgage Loans						Consumer
(In Thousands)	Residential		Multi-Family		CommercialReal Estate		and OtherLoans		Total
Loans:
Individually evaluated for impairment	$	272,146	$	56,116	$	18,644	$	—	$	346,906
Collectively evaluated for impairment	9,439,080		2,350,562		755,272		264,094		12,809,008
Total loans	$	9,711,226	$	2,406,678	$	773,916	$	264,094	$	13,155,914
Allowance for loan losses:
Individually evaluated for impairment	$	1,001	$	2,576	$	1,469	$	—	$	5,046
Collectively evaluated for impairment	88,266		32,938		12,935		6,316		140,455
Total allowance for loan losses	$	89,267	$	35,514	$	14,404	$	6,316	$	145,501

Summary of information related to impaired mortgage loans by segment and class

	At September 30, 2013									At December 31, 2012
(In Thousands)	UnpaidPrincipalBalance		RecordedInvestment		RelatedAllowance			Net Investment		UnpaidPrincipalBalance		RecordedInvestment		RelatedAllowance			Net Investment
With an allowance recorded:
Residential:
Full documentation interest-only	$	149,386	$	114,923	$	(7,797	)	$	107,126	$	10,740	$	10,740	$	(241	)	$	10,499
Full documentation amortizing	40,794		35,014		(2,550		)	32,464		6,122		6,122		(347		)	5,775
Reduced documentation interest-only	183,353		139,472		(9,564		)	129,908		12,893		12,893		(277		)	12,616
Reduced documentation amortizing	29,062		24,086		(2,354		)	21,732		3,889		3,889		(136		)	3,753
Multi-family	23,437		23,437		(2,179		)	21,258		19,704		19,704		(2,576		)	17,128
Commercial real estate	6,764		6,764		(322		)	6,442		10,835		10,835		(1,469		)	9,366
Without an allowance recorded:
Residential:
Full documentation interest-only	—		—		—			—		122,275		86,607		—			86,607
Full documentation amortizing	—		—		—			—		23,489		17,962		—			17,962
Reduced documentation interest-only	—		—		—			—		166,477		116,514		—			116,514
Reduced documentation amortizing	—		—		—			—		23,419		17,419		—			17,419
Multi-family	38,635		31,954		—			31,954		44,341		36,412		—			36,412
Commercial real estate	14,830		10,390		—			10,390		13,256		7,809		—			7,809
Total impaired loans	$	486,261	$	386,040	$	(24,766	)	$	361,274	$	457,440	$	346,906	$	(5,046	)	$	341,860

Schedule of information related to average recorded investment, interest income recognized and cash basis interest income related to impaired mortgage loans

	For the Three Months Ended September 30,
	2013						2012
(In Thousands)	Average Recorded Investment		Interest Income Recognized		Cash Basis Interest Income		Average Recorded Investment		Interest Income Recognized		Cash Basis Interest Income
With an allowance recorded:
Residential:
Full documentation interest-only	$	107,893	$	762	$	763	$	10,254	$	79	$	77
Full documentation amortizing	31,128		218		220		4,210		40		41
Reduced documentation interest-only	144,468		1,171		1,174		10,469		130		122
Reduced documentation amortizing	24,452		158		152		2,272		27		19
Multi-family	19,557		34		169		60,560		1,146		590
Commercial real estate	7,604		56		66		11,838		229		97
Without an allowance recorded:
Residential:
Full documentation interest-only	9,075		—		—		83,722		417		411
Full documentation amortizing	2,968		—		—		16,611		117		108
Reduced documentation interest-only	—		—		—		118,021		742		728
Reduced documentation amortizing	—		—		—		18,694		79		69
Multi-family	31,464		401		416		12,517		503		227
Commercial real estate	11,252		112		131		6,623		272		99
Total impaired loans	$	389,861	$	2,912	$	3,091	$	355,791	$	3,781	$	2,588

	For the Nine Months Ended September 30,
	2013						2012
(In Thousands)	Average Recorded Investment		Interest Income Recognized		Cash Basis Interest Income		Average Recorded Investment		Interest Income Recognized		Cash Basis Interest Income
With an allowance recorded:
Residential:
Full documentation interest-only	$	105,931	$	2,114	$	2,229	$	10,360	$	247	$	247
Full documentation amortizing	29,465		623		639		4,071		121		122
Reduced documentation interest-only	146,773		3,053		3,205		10,967		342		345
Reduced documentation amortizing	25,424		464		493		2,084		86		78
Multi-family	18,975		659		722		55,319		2,252		1,946
Commercial real estate	8,692		253		285		13,196		430		321
Without an allowance recorded:
Residential:
Full documentation interest-only	14,433		—		—		81,638		1,069		1,136
Full documentation amortizing	4,396		—		—		17,452		221		234
Reduced documentation interest-only	2,086		—		—		115,363		1,731		1,824
Reduced documentation amortizing	—		—		—		17,293		291		303
Multi-family	33,294		1,165		1,229		9,168		921		662
Commercial real estate	10,118		286		319		4,812		541		389
Total impaired loans	$	399,587	$	8,617	$	9,121	$	341,723	$	8,252	$	7,607

Restructured Loans

Loans receivable and allowance for loan losses disclosures

Schedule of information about mortgage loans receivable by segment and class modified in TDR

	Modifications During the Three Months Ended September 30,
	2013			2012
(Dollars In Thousands)	Number of Loans	Pre- Modification Recorded Investment	Recorded Investment at September 30, 2013	Number of Loans	Pre- Modification Recorded Investment	Recorded Investment at September 30, 2012
Residential:
Full documentation interest-only	7	$   2,128	$   2,127	2	$     355	$      354
Full documentation amortizing	1	161	161	3	805	786
Reduced documentation interest-only	10	3,107	3,096	5	2,693	2,690
Reduced documentation amortizing	2	387	386	—	—	—
Multi-family	5	3,967	3,774	—	—	—
Commercial real estate	4	6,488	5,458	3	3,437	3,325
Total	29	$ 16,238	$ 15,002	13	$  7,290	$   7,155

	Modifications During the Nine Months Ended September 30,
	2013			2012
(Dollars In Thousands)	Number of Loans	Pre- Modification Recorded Investment	Recorded Investment at September 30, 2013	Number of Loans	Pre- Modification Recorded Investment	Recorded Investment at September 30, 2012
Residential:
Full documentation interest-only	18	$   4,579	$   4,577	6	$   1,415	$   1,384
Full documentation amortizing	6	1,662	1,682	3	805	786
Reduced documentation interest-only	28	8,957	8,921	12	5,422	5,407
Reduced documentation amortizing	8	2,470	2,408	5	1,950	1,840
Multi-family	8	6,751	6,228	12	31,581	29,129
Commercial real estate	7	10,443	9,125	6	7,671	6,120
Total	75	$ 34,862	$ 32,941	44	$ 48,844	$ 44,666

Defaulted Loans

Loans receivable and allowance for loan losses disclosures

Schedule of information about mortgage loans receivable by segment and class modified in TDR

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2013		2012		2013		2012
(Dollars In Thousands)	Number of Loans	Recorded Investment at September 30, 2013	Number of Loans	Recorded Investment at September 30, 2012	Number of Loans	Recorded Investment at September 30, 2013	Number of Loans	Recorded Investment at September 30, 2012
Residential:
Full documentation interest-only	14	$    3,365	—	$        —	22	$    5,343	—	$        —
Full documentation amortizing	8	2,159	1	485	10	2,589	1	485
Reduced documentation interest-only	20	5,729	3	1,174	24	6,707	5	1,821
Reduced documentation amortizing	2	303	—	—	5	880	5	1,817
Multi-family	1	671	1	2,062	1	671	2	3,743
Total	45	$ 12,227	5	$  3,721	62	$  16,190	13	$    7,866

Performing, non-performing credit quality indicator

Loans receivable and allowance for loan losses disclosures

Schedule of loan receivable segments by class and credit quality indicator

	At September 30, 2013
	Residential Mortgage Loans								Consumer and Other Loans
	Full Documentation				Reduced Documentation				Home Equity
(In Thousands)	Interest-only		Amortizing		Interest-only		Amortizing		Lines of Credit		Other
Performing	$	1,417,153	$	5,448,483	$	755,022	$	359,442	$	200,044	$	37,595
Non-performing:
Current or past due less than 90 days	23,665		10,247		33,435		6,380		32		—
Past due 90 days or more	85,019		42,294		91,089		26,289		6,441		33
Total	$	1,525,837	$	5,501,024	$	879,546	$	392,111	$	206,517	$	37,628

	At December 31, 2012
	Residential Mortgage Loans								Consumer and Other Loans
	Full Documentation				Reduced Documentation				Home Equity
(In Thousands)	Interest-only		Amortizing		Interest-only		Amortizing		Lines of Credit		Other
Performing	$	1,901,875	$	6,260,546	$	891,813	$	365,941	$	225,461	$	32,125
Non-performing:
Current or past due less than 90 days	1,614		1,312		6,228		1,226		—		—
Past due 90 days or more	97,907		43,014		107,254		32,496		6,459		49
Total	$	2,001,396	$	6,304,872	$	1,005,295	$	399,663	$	231,920	$	32,174

Criticized, Not Criticized

Loans receivable and allowance for loan losses disclosures

Schedule of loan receivable segments by class and credit quality indicator

	At September 30, 2013				At December 31, 2012
(In Thousands)	Multi-Family		Commercial Real Estate		Multi-Family		Commercial Real Estate
Not criticized	$	3,027,701	$	774,515	$	2,271,006	$	706,334
Criticized:
Special mention	20,016		8,123		54,956		28,210
Substandard	70,297		40,182		80,716		39,372
Doubtful	—		—		—		—
Total	$	3,118,014	$	822,820	$	2,406,678	$	773,916

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Litigation

9 Months Ended

Sep. 30, 2013

Litigation

Litigation

12. Litigation

In the ordinary course of our business, we are routinely made a defendant in or a party to pending or threatened legal actions or proceedings which, in some cases, seek substantial monetary damages from or other forms of relief against us.  In our opinion, after consultation with legal counsel, we believe it unlikely that such actions or proceedings will have a material adverse effect on our financial condition, results of operations or liquidity.

City of New York Notice of Determination

By “Notice of Determination” dated September 14, 2010 and August 26, 2011, the City of New York notified us of alleged tax deficiencies in the amount of $13.3 million, including interest and penalties, related to our 2006 through 2008 tax years.  The deficiencies relate to our operation of two subsidiaries of Astoria Federal, Fidata Service Corp., or Fidata, and Astoria Federal Mortgage Corp., or AF Mortgage.  We disagree with the assertion of the tax deficiencies.  Hearings in this matter were held before the New York City Tax Appeals Tribunal, or the NYC Tax Appeals Tribunal, in March and April 2013.  The NYC Tax Appeals Tribunal is not expected to render a decision in this matter until the 2014 third quarter.  At this time, management believes it is more likely than not that we will succeed in refuting the City of New York’s position, although defense costs may be significant.  Accordingly, no liability or reserve has been recognized in our consolidated statement of financial condition at September 30, 2013 with respect to this matter.

No assurance can be given as to whether or to what extent we will be required to pay the amount of the tax deficiencies asserted by the City of New York, whether additional tax will be assessed for years subsequent to 2008, that this matter will not be costly to oppose, that this matter will not have an impact on our financial condition or results of operations or that, ultimately, any such impact will not be material.

Automated Transactions LLC Litigation

In November 2009, an action entitled Automated Transactions LLC v. Astoria Financial Corporation and Astoria Federal Savings and Loan Association was commenced in the U.S. District Court for the Southern District of New York, or the Southern District Court, against us by Automated Transactions LLC, alleging patent infringement involving integrated banking and transaction machines, including automated teller machines, or ATMs, that we utilize.  The plaintiff sought unspecified monetary damages and an injunction preventing us from continuing to utilize the allegedly infringing machines.  In March 2011, the Southern District Court dismissed all claims against Astoria Financial Corporation but denied our motion to dismiss the claims against Astoria Federal for alleged direct patent infringement.

In July 2012, we filed a motion for summary judgment for non-infringement based on a ruling by the U.S. Court of Appeals for the Federal District affirming the decision of the U.S. District Court for the District of Delaware, or the Delaware District Court, to grant summary judgment in favor of a defendant in an action involving the same plaintiff making substantially similar allegations with respect to identical and substantially similar patents as those involved in the action against us.  In April 2013, the U.S. Judicial Panel on Multidistrict Litigation transferred this action to the Delaware District Court to be centralized with other cases involving the same plaintiff and common questions of fact.

We settled this litigation, and the case was dismissed with prejudice, pursuant to a stipulation and order of dismissal on September 19, 2013.  The settlement was not material to our financial condition or results of operations and will not result in any restrictions or alteration in the use of our ATMs.  We intend to continue to pursue our demands for indemnification from the manufacturer and from the transaction processor utilized with respect to the integrated banking machines.

XML

Document and Entity Information	9 Months Ended
	Sep. 30, 2013	Oct. 30, 2013
Document and Entity Information
Entity Registrant Name	ASTORIA FINANCIAL CORP
Entity Central Index Key	0000910322
Trading Symbol	AF
Document Type	10-Q
Document Period End Date	Sep. 30, 2013
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		98,865,122
Document Fiscal Year Focus	2013
Document Fiscal Period Focus	Q3

XML

Securities (Tables)

9 Months Ended

Sep. 30, 2013

Securities

Schedule of amortized cost and estimated fair value of securities available-for-sale and held-to-maturity

	At September 30, 2013
(In Thousands)	AmortizedCost		GrossUnrealizedGains		GrossUnrealizedLosses			EstimatedFairValue
Available-for-sale:
Residential mortgage-backed securities:
GSE (1) issuance REMICs and CMOs (2)	$	300,047	$	2,310	$	(5,391	)	$	296,966
Non-GSE issuance REMICs and CMOs	8,330		67		(1		)	8,396
GSE pass-through certificates	17,150		810		(3		)	17,957
Total residential mortgage-backed securities	325,527		3,187		(5,395		)	323,319
Obligations of GSEs	98,674		—		(6,244		)	92,430
Fannie Mae stock	15		—		(14		)	1
Total securities available-for-sale	$	424,216	$	3,187	$	(11,653	)	$	415,750
Held-to-maturity:
Residential mortgage-backed securities:
GSE issuance REMICs and CMOs	$	1,534,021	$	16,264	$	(21,336	)	$	1,528,949
Non-GSE issuance REMICs and CMOs	4,054		69		(10		)	4,113
GSE pass-through certificates	288,655		884		(8,235		)	281,304
Total residential mortgage-backed securities	1,826,730		17,217		(29,581		)	1,814,366
Obligations of GSEs	88,127		—		(6,326		)	81,801
Other	604		—		—			604
Total securities held-to-maturity	$	1,915,461	$	17,217	$	(35,907	)	$	1,896,771

(1) Government-sponsored enterprise

(2) Real estate mortgage investment conduits and collateralized mortgage obligations

	At December 31, 2012
(In Thousands)	AmortizedCost		GrossUnrealizedGains		GrossUnrealizedLosses			EstimatedFairValue
Available-for-sale:
Residential mortgage-backed securities:
GSE issuance REMICs and CMOs	$	200,152	$	5,258	$	(583	)	$	204,827
Non-GSE issuance REMICs and CMOs	11,296		9		(86		)	11,219
GSE pass-through certificates	20,348		1,029		(2		)	21,375
Total residential mortgage-backed securities	231,796		6,296		(671		)	237,421
Obligations of GSEs	98,670		214		(5		)	98,879
Fannie Mae stock	15		—		(15		)	—
Total securities available-for-sale	$	330,481	$	6,510	$	(691	)	$	336,300
Held-to-maturity:
Residential mortgage-backed securities:
GSE issuance REMICs and CMOs	$	1,693,437	$	27,787	$	(2,955	)	$	1,718,269
Non-GSE issuance REMICs and CMOs	5,791		112		—			5,903
GSE pass-through certificates	257		6		(1		)	262
Total residential mortgage-backed securities	1,699,485		27,905		(2,956		)	1,724,434
Other	656		—		—			656
Total securities held-to-maturity	$	1,700,141	$	27,905	$	(2,956	)	$	1,725,090

Schedule of estimated fair values of securities with gross unrealized losses in continuous unrealized loss position for less than twelve months and for twelve months or longer

	At September 30, 2013
	Less Than Twelve Months		Twelve Months or Longer		Total
(In Thousands)	EstimatedFair Value	GrossUnrealizedLosses	EstimatedFair Value	GrossUnrealizedLosses	EstimatedFair Value	GrossUnrealizedLosses
Available-for-sale:
GSE issuance REMICs and CMOs	$ 157,497	$   (5,193)	$ 17,296	$    (198)	$ 174,793	$   (5,391	)
Non-GSE issuance REMICs and CMOs	—	—	140	(1)	140	(1	)
GSE pass-through certificates	292	(1)	90	(2)	382	(3	)
Obligations of GSEs	92,430	(6,244)	—	—	92,430	(6,244	)
Fannie Mae stock	—	—	1	(14)	1	(14	)
Total temporarily impaired securities available-for-sale	$ 250,219	$ (11,438)	$ 17,527	$    (215)	$ 267,746	$ (11,653	)
Held-to-maturity:
GSE issuance REMICs and CMOs	$ 647,583	$ (17,525)	$ 78,148	$ (3,811)	$ 725,731	$ (21,336	)
Non-GSE issuance REMICs and CMOs	398	(10)	—	—	398	(10	)
GSE pass-through certificates	182,209	(8,234)	31	(1)	182,240	(8,235	)
Obligations of GSEs	81,801	(6,326)	—	—	81,801	(6,326	)
Total temporarily impaired securities held-to-maturity	$ 911,991	$ (32,095)	$ 78,179	$ (3,812)	$ 990,170	$ (35,907	)

	At December 31, 2012
	Less Than Twelve Months		Twelve Months or Longer		Total
(In Thousands)	EstimatedFair Value	GrossUnrealizedLosses	EstimatedFair Value	GrossUnrealizedLosses	EstimatedFair Value	GrossUnrealizedLosses
Available-for-sale:
GSE issuance REMICs and CMOs	$   67,841	$    (583)	$       —	$     —	$  67,841	$    (583	)
Non-GSE issuance REMICs and CMOs	—	—	10,709	(86)	10,709	(86	)
GSE pass-through certificates	57	(1)	47	(1)	104	(2	)
Obligations of GSEs	24,995	(5)	—	—	24,995	(5	)
Fannie Mae stock	—	—	—	(15)	—	(15	)
Total temporarily impaired securities available-for-sale	$   92,893	$    (589)	$ 10,756	$ (102)	$ 103,649	$    (691	)
Held-to-maturity:
GSE issuance REMICs and CMOs	$ 413,651	$ (2,759)	$ 12,259	$ (196)	$ 425,910	$ (2,955	)
GSE pass-through certificates	48	(1)	—	—	48	(1	)
Total temporarily impaired securities held-to-maturity	$ 413,699	$ (2,760)	$ 12,259	$ (196)	$ 425,958	$ (2,956	)

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Fair Value Measurements (Details 5) (USD $) In Thousands, unless otherwise specified			9 Months Ended
	Sep. 30, 2013	Dec. 31, 2012	Sep. 30, 2013 Mortgage loans held-for-sale Minimum	Sep. 30, 2013 Mortgage loans held-for-sale Maximum	Sep. 30, 2013 Total Fair Value	Dec. 31, 2012 Total Fair Value	Sep. 30, 2013 Level 2 Fair Value	Dec. 31, 2012 Level 2 Fair Value	Sep. 30, 2013 Level 3 Fair Value	Dec. 31, 2012 Level 3 Fair Value	Sep. 30, 2013 Carrying Value	Dec. 31, 2012 Carrying Value
Financial Assets:
Securities held-to-maturity	$ 1,915,461	$ 1,700,141			$ 1,896,771	$ 1,725,090	$ 1,896,771	$ 1,725,090			$ 1,915,461	$ 1,700,141
FHLB-NY stock	153,217	171,194			153,217	171,194	153,217	171,194			153,217	171,194
Loans held-for-sale, net					10,866	78,486			10,866	78,486	10,485	76,306
Loans receivable, net					12,630,027	13,311,997			12,630,027	13,311,997	12,398,543	13,078,471
MSR, net	10,835	6,947			10,838	6,948			10,838	6,948	10,835	6,947
Mortgage loan, original term			15 years	30 years
Financial Liabilities:
Deposits					10,140,390	10,588,073	10,140,390	10,588,073			10,060,374	10,443,958
Borrowings, net					$ 4,374,578	$ 4,857,989	$ 4,374,578	$ 4,857,989			$ 4,109,028	$ 4,373,496

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Fair Value Measurements (Details 4)	9 Months Ended	12 Months Ended
	Sep. 30, 2013	Dec. 31, 2012
Valuation methodologies used for assets measured at fair value
Impaired loans comprising residential mortgage loans (as a percent)	81.00%	78.00%
Impaired loans comprising multi-family and commercial real estate loans (as a percent)	19.00%	22.00%
Impaired loans for which fair value adjustment is recognized comprising residential mortgage loans (as a percent)	84.00%	84.00%
Impaired loans for which fair value adjustment is recognized comprising multi-family and commercial real estate loans (as a percent)	16.00%	16.00%
Weighted average
Valuation methodologies used for assets measured at fair value
Assumption to estimate fair value of servicing asset, weighted average discount rate (as a percent)	10.42%	10.95%
Assumption to estimate fair value of servicing asset, weighted average constant prepayment rate (as a percent)	14.64%	23.12%
Assumption to estimate fair value of servicing asset, weighted average life	5 years 2 months 12 days	3 years 4 months 24 days
Residential
Valuation methodologies used for assets measured at fair value
Period past due when loan servicer performs property inspections	45 days
Period after which loans are individually evaluated for impairment	180 days