8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of report (Date of earliest event reported): October 19, 2006

ASTORIA FINANCIAL CORPORATION

(Exact name of registrant as specified in its charter)

Delaware	001-11967	11-3170868
(State or other jurisdiction of incorporation or organization)	(Commission File Number)	(IRS Employer Identification No.)

ONE ASTORIA FEDERAL PLAZA, LAKE SUCCESS, NEW YORK 11042-1085

(Address of principal executive offices, including zip code)

Registrant’s telephone number, including area code: (516) 327-3000

NOT APPLICABLE

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12(b) under the Exchange Act (17 CFR 240.14a-12(b))

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

ITEMS 1, 3 THROUGH 8  NOT APPLICABLE.

Item 2.02.          Results of Operations and Financial Condition.

          On October 19, 2006, Astoria Financial Corporation (“Astoria”) issued a press release which, among other things, highlights the Company’s financial results for the third quarter ended September 30, 2006.  A copy of the press release is included herewith as an exhibit to this report.

          The information provided pursuant hereto shall not be deemed incorporated by reference by any general statement incorporating by reference this Form 8-K into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, and shall not otherwise be deemed filed under such Acts.

Item 9.01.          Financial Statements and Exhibits.

(d)          Exhibits.

              Exhibit 99.1     Press release dated October 19, 2006.

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SIGNATURE

          Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	ASTORIA FINANCIAL CORPORATION
	By:	/s/ Peter J. Cunningham.
		Peter J. Cunningham
		First Vice President and
		Director of Investor Relations
Dated:  October 19, 2006

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EXHIBIT INDEX

Exhibit Number	Description
99.1	Press release dated October 19, 2006.

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EX-99.1

Exhibit 99.1

Astoria Financial Corporation Announces Third Quarter EPS of $0.43

Quarterly Cash Dividend of $0.24 Per Common Share Declared

          LAKE SUCCESS, N.Y., Oct. 19 /PRNewswire-FirstCall/ -- Astoria Financial Corporation (NYSE: AF) (“Astoria”), the holding company for Astoria Federal Savings and Loan Association (“Astoria Federal”), today reported net income of $41.1 million, or $0.43 diluted earnings per share (“EPS”), for the quarter ended September 30, 2006, compared to $59.2 million, or $0.57 EPS, for the 2005 third quarter.  For the 2006 third quarter, annualized returns on average equity, average tangible equity and average assets were 13.06%, 15.31% and 0.76%, respectively, compared to 17.09%, 19.73% and 1.05%, respectively, for the comparable 2005 period.

          For the nine months ended September 30, 2006, net income totaled $137.8 million, or $1.40 EPS, compared to $176.1 million, or $1.69 EPS, for the comparable 2005 period.  For the nine months ended September 30, 2006, annualized returns on average equity, average tangible equity and average assets were 14.27%, 16.67% and 0.84%, respectively, compared to 17.06%, 19.71% and 1.02%, respectively, for the comparable 2005 period.

2006 Nine Month Balance Sheet Highlights:
-- Deposits increased $367 million, or 4% annualized
-- Loan portfolio increased $354 million, or 3% annualized
	- Multifamily/Commercial Real Estate (“CRE”) loan portfolio increased $215 million, or 7% annualized
	- One-to-four family loan portfolio increased $173 million, or 2% annualized
-- Securities portfolio decreased $974 million, or 20% annualized
-- Borrowings decreased $1.1 billion, or 19% annualized
-- Repurchased 6.5 million shares

          Commenting on the 2006 third quarter results, George L. Engelke, Jr., Chairman, President and Chief Executive Officer of Astoria, noted, “The decline in U.S. Treasury bond yields during the third quarter caused a further inversion of the yield curve which continued to exert pressure on our net interest margin and earnings while limiting the opportunities for profitable balance sheet growth.  Accordingly, we continued our strategy of shrinking the balance sheet by reducing the securities portfolio and borrowings, growing loans and deposits and repurchasing our stock.” 

          Board Declares Quarterly Cash Dividend of $0.24 Per Share

          The Board of Directors of the Company, at their October 18, 2006 meeting, declared a quarterly cash dividend of $0.24 per common share.  The dividend is payable on December 1, 2006 to shareholders of record as of November 15, 2006. This is the forty-sixth consecutive quarterly cash dividend declared by the Company. 

          Eleventh Stock Repurchase Program Continues

          During the third quarter, Astoria repurchased 1.8 million shares of its common stock at an average cost of $30.41 per share.  During the nine month period ended September 30, 2006, Astoria repurchased a total of 6.5 million shares, completing its tenth stock repurchase program and commencing its eleventh stock repurchase program in the first quarter.  Under the current stock repurchase program, 3.7 million shares of the 10 million shares authorized remain available for repurchase. 

          Third Quarter and Nine Month Earnings Summary

          Net interest income for the quarter ended September 30, 2006 totaled $90.7 million compared to $101.3 million for the 2006 second quarter and $118.5 million for the third quarter a year ago.  For the nine months ended September 30, 2006, net interest income totaled $303.5 million compared to $365.1 million for the comparable 2005 nine month period.

          Astoria’s net interest margin for the quarter ended September 30, 2006 declined to 1.75% from 1.92% for the previous quarter and 2.20% for the quarter ended September 30, 2005, primarily due to the cost of interest- bearing liabilities rising more rapidly than the yield on interest-earning assets.

          Non-interest income for the quarter ended September 30, 2006 totaled $22.9 million compared to $28.4 million for the 2005 third quarter.  The decrease is primarily due to lower mortgage banking income, net, primarily due to the MSR valuation adjustments, as well as lower customer service fees.

          For the nine months ended September 30, 2006, non-interest income totaled $67.5 million compared to $75.6 million for the comparable 2005 period.  The decline was primarily due to a $5.5 million, pre-tax, charge related to the termination of interest rate swap agreements in the 2006 first quarter, a $1.3 million decrease in mortgage banking income, net, and a $0.9 million decrease in other loan fees, due primarily to the outsourcing of mortgage loan servicing effective December 1, 2005.

          The components of mortgage banking income, net, which is included in non- interest income, are detailed below:

(Dollars in millions)	3Q06			3Q05			9 Mos. 06			9 Mos. 05
Loan servicing fees	$	1.1		$	1.2		$	3.4		$	3.8
Amortization of MSR*		(0.9	)		(1.3	)		(2.8	)		(4.0	)
MSR valuation adjustments		(0.5	)		2.7			1.5			2.6
Net gain on sale of loans		0.5			1.1			1.7			2.7
Mortgage banking income, net	$	0.2		$	3.7		$	3.8		$	5.1

* Mortgage servicing rights

          General and administrative expense (“G&A”) for the quarter ended September 30, 2006 declined $4.6 million to $53.3 million from $57.9 million for the comparable 2005 period due primarily to a $3.5 million reduction in compensation and benefits expense and a reduction in other expense due to an $850,000 reimbursement for certain legal fees.  The decrease in compensation and benefits expense is primarily a result of the outsourcing of mortgage servicing and further reductions in incentive compensation accruals, partially offset by increases in stock-based compensation.

          For the nine months ended September 30, 2006, G&A declined $11.2 million to $164.8 million from $176.0 million for the comparable 2005 period.  The decrease was predominantly due to a $5.4 million decrease in compensation and benefits expense, a $5.2 million decrease in other expense due primarily to lower goodwill litigation expense, and a $1.9 million decrease in advertising expense, partially offset by a $1.4 million increase in occupancy, equipment and systems expense primarily related to the outsourcing of mortgage servicing. 

          Balance Sheet Summary

          The further inversion of the yield curve during the third quarter continued to narrow spread availability. Accordingly, we continued to reduce our balance sheet through the reduction of non-core business activities. Total securities for the quarter ended September 30, 2006 declined $272.2 million, or 19% annualized, to $5.6 billion at September 30, 2006, representing 26% of total assets.  Borrowings declined in the third quarter of 2006 by $378.3 million, or 21% annualized, to $6.8 billion at September 30, 2006, representing 32% of total assets.

          For the nine months ended September 30, 2006, total securities declined $973.8 million, or 20% annualized, and borrowings declined $1.1 billion, or 19% annualized.  Total assets declined $262.3 million from June 30, 2006 and $781.1 million from December 31, 2005 and total $21.6 billion at September 30, 2006.

          Key balance sheet highlights, reflecting the improvement in the quality of the Company’s balance sheet since December 31, 1999, follow:

(Dollars in millions)	12/31/99		12/31/01		12/31/03		12/31/05		09/30/06		% Change 12/31/99-09/30/06
Assets	$	22,700	$	22,672	$	22,462	$	22,380	$	21,599		-  5	%
Loans	$	10,286	$	12,167	$	12,687	$	14,392	$	14,746		+ 43	%
Securities	$	10,763	$	8,013	$	8,448	$	6,572	$	5,599		- 48	%
Deposits	$	9,555	$	10,904	$	11,187	$	12,810	$	13,177		+ 38	%
Borrowings	$	11,528	$	9,826	$	9,632	$	7,938	$	6,824		- 41	%

          The following table illustrates this improvement on an outstanding per share basis:

Amount per share	12/31/99		12/31/01		12/31/03		12/31/05		09/30/06		% Change			CAGR
Loans	$	66.28	$	89.36	$	107.51	$	137.11	$	148.46		124	%		13	%
Deposits	$	61.57	$	80.09	$	94.80	$	122.04	$	132.66		115	%		12	%

          Total loan production for the third quarter and nine months ended September 30, 2006 was $868.6 million and $2.4 billion, respectively, compared to $1.3 billion and $3.3 billion, respectively, for the comparable 2005 periods.  The loan pipeline at September 30, 2006 totaled $1.2 billion, an increase of $333.5 million, or 41%, over the pipeline at June 30, 2006.

          During the 2006 third quarter, the 1-4 family mortgage loan portfolio increased $107.1 million, or 4% annualized, from the previous quarter and totaled $9.9 billion at September 30, 2006.  For the quarter ended September 30, 2006, 1-4 family loan originations and purchases totaled $706.6 million compared to $983.4 million for the 2005 third quarter.  Of the 2006 third quarter production, 70% consisted of 3/1 and 5/1 adjustable rate mortgage loans.

          For the nine months ended September 30, 2006, the 1-4 family mortgage loan portfolio increased $173.3 million, or 2% annualized.  For the nine month period ended September 30, 2006, 1-4 family loan originations and purchases totaled $1.8 billion compared to $2.4 billion in the year-ago nine month period.  Of the 2006 nine month loan production, 75% consisted of 3/1 and 5/1 adjustable rate mortgage loans.

          During the 2006 third quarter, the multifamily and CRE loan portfolio increased $30.5 million, or 3% annualized, to $4.1 billion, or 28% of total loans, at September 30, 2006.  Multifamily and CRE loan originations totaled $158.2 million for the 2006 third quarter compared to $270.6 million for the comparable 2005 period.  The average loan-to-value ratio of the multifamily and CRE loan portfolio continues to be less than 65%, based on current principal balance and original appraised value, and the average loan balance is less than $1 million.

          For the nine month period ended September 30, 2006, the multifamily and CRE loan portfolio increased $215.0 million, or 7% annualized.  Multifamily and CRE loan originations totaled $559.4 million for the 2006 nine month period compared to $769.0 million in the comparable year-ago period.

          At September 30, 2006, non-performing loans totaled $55.1 million, or 0.25% of total assets, compared to $54.3 million, or 0.25% of total assets, at June 30, 2006 and $65.0 million, or 0.29% of total assets, at December 31, 2005.  Net charge-offs for the quarter and nine months ended September 30, 2006 totaled $1.1 million and $1.2 million, respectively, compared to $472,000 and $711,000, respectively, for the comparable 2005 periods.  The increase in charge-offs for the three and nine months ended September 30, 2006 was due, for the most part, to a $947,000 charge-off on a non-performing loan in foreclosure that was sold in the 2006 third quarter.  The ratio of the allowance for loan losses to non-performing loans at September 30, 2006 was 145%.

          Deposits for the 2006 third quarter increased $84.8 million to $13.2 billion at September 30, 2006.   During the 2006 third quarter, our efforts to extend deposit liabilities resulted in $1.5 billion of non-Liquid CDs issued or repriced at a weighted average rate of 5.21% with a weighted average maturity of 12 months.

          For the nine months ended September 30, 2006, deposits increased $366.6 million, or 4% annualized. During that period $4.7 billion of non-Liquid CDs were issued or repriced at a weighted average rate of 4.83% with a weighted average maturity of 12 months.

          Commenting on the bank’s retail activity, Mr. Engelke noted, “Our marketing efforts continue to produce new customers from our communities, creating relationship development opportunities for us.  For example, during the nine months ended September 30, 2006, 19% of all new and existing CD customers, and 22% of all new and existing Liquid CD customers, without checking accounts, were cross-sold new, low-cost checking accounts, the linchpin product for building long-term, profitable customer relationships.”

          Stockholders’ equity was $1.3 billion, or 5.84% of total assets at September 30, 2006.  Astoria Federal continues to maintain capital ratios in excess of regulatory requirements with core, tangible and risk-based capital ratios of 6.84%, 6.84% and 12.66%, respectively, at September 30, 2006. 

          Future Outlook

          Commenting on the outlook for the remainder of 2006 and 2007, Mr. Engelke stated, “The interest rate environment remains very challenging, characterized by a prolonged flat-to-inverted yield curve that continues to negatively impact our net interest margin and earnings and limits opportunities for profitable growth.  We anticipate continued margin compression for the fourth quarter, although the magnitude of the compression will be less than the current quarter.  Looking forward, based on our economic forecasting model which currently includes three 25 basis point reductions by the Federal Reserve in 2007 and a gradual flattening of the yield curve, we expect the margin to remain relatively stable in 2007.  We will, as a result, continue our strategy of shrinking the balance sheet through reductions in the securities portfolio and borrowings through normal cash flow, while we emphasize deposit and loan growth, all of which will continue to improve the quality of both the balance sheet and earnings. As we reduce the size of the balance sheet, we will continue to focus on the repurchase of our stock as a very desirable use of capital.  This strategy should better position us to take advantage of more profitable asset growth opportunities when the yield curve steepens.” 

          Astoria Financial Corporation, the holding company for Astoria Federal Savings and Loan Association, with assets of $21.6 billion is the fifth largest thrift institution in the United States.  Established in 1888, Astoria Federal is the largest thrift depository headquartered in New York with deposits of $13.2 billion and embraces its philosophy of Putting people first by providing the customers and local communities it serves with quality financial products and services through 86 convenient banking office locations and multiple delivery channels, including its enhanced website, www.astoriafederal.com. Astoria Federal commands the fourth largest deposit market share in the attractive Long Island market, which includes Brooklyn, Queens, Nassau, and Suffolk counties with a population exceeding that of 38 individual states.  Astoria Federal originates mortgage loans through its banking offices and loan production offices in New York, an extensive broker network covering twenty-four states, primarily the East Coast, and the District of Columbia, and through correspondent relationships covering forty- four states and the District of Columbia. 

          Earnings Conference Call October 20, 2006 at 9:00 a.m. (ET)

          The Company, as previously announced, indicated that Mr. Engelke will host an earnings conference call Friday morning October 20, 2006 at 9:00 a.m. (ET). The toll-free dial-in number is (800) 967-7140.

          A telephone replay will be available on October 20, 2006 from 12 noon (ET) through Friday, October 27, 2006 11:59 p.m. (ET).  The replay number is (888) 203-1112, passcode: 2849847.  The conference call will also be simultaneously webcast on the Company’s website www.astoriafederal.com and archived for one year. 

          Forward Looking Statements

          This document 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.  These statements may be identified by the use of such words as “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “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 its 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 of the areas in which we do business, or conditions in the securities markets or the banking industry may be less favorable than we currently anticipate; legislative or regulatory changes may adversely affect our business; applicable 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 matters before regulatory agencies, whether currently existing or commencing in the future, may delay the occurrence or non-occurrence of events longer than we anticipate.  We assume no obligation to update any forward-looking statements to reflect events or circumstances after the date of this document.

ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(In Thousands, Except Share Data)

	At September 30, 2006			At December 31, 2005
ASSETS
Cash and due from banks	$	152,735		$	169,234
Repurchase agreements		54,660			182,803
Securities available-for-sale		1,617,461			1,841,351
Securities held-to-maturity (fair value of $3,878,082 and $4,627,013, respectively)		3,981,062			4,730,953
Federal Home Loan Bank of New York stock, at cost		139,349			145,247
Loans held-for-sale, net		14,629			23,651
Loans receivable:
Mortgage loans, net		14,286,640			13,879,804
Consumer and other loans, net		459,245			512,489
		14,745,885			14,392,293
Allowance for loan losses		(79,930	)		(81,159	)
Total loans receivable, net		14,665,955			14,311,134
Mortgage servicing rights, net		16,167			16,502
Accrued interest receivable		80,341			80,318
Premises and equipment, net		146,077			151,494
Goodwill		185,151			185,151
Bank owned life insurance		381,886			382,613
Other assets		163,655			159,820
TOTAL ASSETS	$	21,599,128		$	22,380,271
LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities:
Deposits	$	13,177,006		$	12,810,455
Reverse repurchase agreements		4,780,000			5,780,000
Federal Home Loan Bank of New York advances		1,628,527			1,724,000
Other borrowings, net		415,832			433,526
Mortgage escrow funds		165,816			124,929
Accrued expenses and other liabilities		170,768			157,134
TOTAL LIABILITIES		20,337,949			21,030,044
Stockholders’ equity:
Preferred stock, $1.00 par value; (5,000,000 shares authorized; none issued and outstanding)		—			—
Common stock, $.01 par value; (200,000,000  shares authorized; 166,494,888 shares issued; and 99,326,924 and 104,967,280 shares outstanding, respectively)		1,665			1,665
Additional paid-in capital		837,567			824,102
Retained earnings		1,839,443			1,774,924
Treasury stock (67,167,964 and 61,527,608 shares, at cost, respectively)		(1,350,189	)		(1,171,604	)
Accumulated other comprehensive loss		(44,421	)		(49,536	)
Unallocated common stock held by ESOP (6,246,454 and 6,465,273 shares, respectively)		(22,886	)		(23,688	)
Deferred compensation		—			(5,636	)
TOTAL STOCKHOLDERS’ EQUITY		1,261,179			1,350,227
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	21,599,128		$	22,380,271

ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME
(In Thousands, Except Share Data)

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2006		2005		2006			2005
Interest income:
Mortgage loans:
One-to-four family	$	127,735	$	115,118	$	378,226		$	339,598
Multi-family, commercial real estate and construction		65,933		60,951		192,178			177,447
Consumer and other loans		9,099		8,199		26,918			22,455
Mortgage-backed and other securities		64,946		82,072		205,373			264,520
Repurchase agreements		1,266		1,056		5,205			3,866
Federal Home Loan Bank of New York stock		2,049		1,577		5,535			4,400
Total interest income		271,028		268,973		813,435			812,286
Interest expense:
Deposits		102,103		71,903		275,357			203,928
Borrowings		78,258		78,534		234,549			243,262
Total interest expense		180,361		150,437		509,906			447,190
Net interest income		90,667		118,536		303,529			365,096
Provision for loan losses		—		—		—			—
Net interest income after provision for loan losses		90,667		118,536		303,529			365,096
Non-interest income:
Customer service fees		16,170		17,798		49,208			49,049
Other loan fees		983		1,397		2,755			3,643
Mortgage banking income, net		181		3,703		3,810			5,067
Income from bank owned life insurance		3,957		4,070		12,063			12,435
Other		1,573		1,404		(348	)		5,446
Total non-interest income		22,864		28,372		67,488			75,640
Non-interest expense:
General and administrative:
Compensation and benefits		27,584		31,060		86,423			91,817
Occupancy, equipment and systems		16,104		15,978		49,209			47,790
Federal deposit insurance premiums		414		432		1,263			1,327
Advertising		1,839		1,765		5,668			7,540
Other		7,374		8,680		22,280			27,516
Total non-interest expense		53,315		57,915		164,843			175,990
Income before income tax expense		60,216		88,993		206,174			264,746
Income tax expense		19,122		29,814		68,383			88,692
Net income	$	41,094	$	59,179	$	137,791		$	176,054
Basic earnings per common share	$	0.44	$	0.59	$	1.44		$	1.72
Diluted earnings per common share	$	0.43	$	0.57	$	1.40		$	1.69
Basic weighted average common shares		93,944,367		101,058,022		95,563,670			102,149,797
Diluted weighted average common and common equivalent shares		96,489,271		103,088,233		98,137,080			104,069,045

ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES

SELECTED FINANCIAL RATIOS AND OTHER DATA

	For the Three Months Ended September 30,						At or For the Nine Months Ended September 30,
	2006			2005			2006			2005
Selected Returns and Financial Ratios (annualized)
Return on average stockholders’ equity		13.06	%		17.09	%		14.27	%		17.06	%
Return on average tangible stockholders’ equity (1)		15.31			19.73			16.67			19.71
Return on average assets		0.76			1.05			0.84			1.02
General and administrative expense to average assets		0.98			1.02			1.00			1.02
Efficiency ratio (2)		46.96			39.42			44.43			39.93
Net interest rate spread (3)		1.64			2.11			1.83			2.13
Net interest margin (4)		1.75			2.20			1.93			2.21
Selected Non-GAAP Returns and Financial Ratios (annualized) (5)
Non-GAAP return on average stockholders’ equity								14.65	%		17.06	%
Non-GAAP return on average tangible stockholders’ equity (1)								17.11			19.71
Non-GAAP return on average assets								0.86			1.02
Non-GAAP efficiency ratio (2)								43.79			39.93
Asset Quality Data (dollars in thousands)
Non-performing loans/total loans								0.37	%		0.27	%
Non-performing loans/total assets								0.25			0.17
Non-performing assets/total assets								0.26			0.17
Allowance for loan losses/non-performing loans								145.16			216.39
Allowance for loan losses/non-accrual loans								146.50			219.22
Allowance for loan losses/total loans								0.54			0.58
Net charge-offs to average loans outstanding (annualized)		0.03	%		0.01	%		0.01			0.01
Non-performing assets							$	55,488		$	39,213
Non-performing loans								55,063			37,916
Loans 90 days past maturity but still accruing interest								502			490
Non-accrual loans								54,561			37,426
Net charge-offs	$	1,133		$	472			1,229			711
Capital Ratios (Astoria Federal)
Tangible								6.84	%		6.20	%
Core								6.84			6.20
Risk-based								12.66			12.11
Other Data
Cash dividends paid per common share	$	0.24		$	0.20		$	0.72		$	0.60
Dividend payout ratio		55.81	%		35.09	%		51.43	%		35.50	%
Book value per share (6)							$	13.55		$	13.81
Tangible book value per share (7)								11.56			11.97
Average equity/average assets		5.81	%		6.12	%		5.86	%		5.97	%
Mortgage loans serviced for others (in thousands)							$	1,394,240		$	1,548,991
Full time equivalent employees								1,597			1,760

(1)	Average tangible stockholders’ equity represents average stockholders’ equity less average goodwill.
(2)	The efficiency ratio represents general and administrative expense divided by the sum of net interest income plus non-interest income.
(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.
(5)	The information presented for the nine months ended September 30, 2006 represents pro forma calculations which are not in conformity with U.S. generally accepted accounting principles, or GAAP.  The 2006 information excludes the $3.6 million, after tax, ($5.5 million, before tax) charge for the termination of our interest rate swap agreements recorded in the 2006 first quarter.  See page 12 for a reconciliation of GAAP net income to non-GAAP earnings for the nine months ended September 30, 2006.
(6)	Book value per share represents stockholders’ equity divided by outstanding shares, excluding unallocated Employee Stock Ownership Plan, or ESOP, shares.
(7)	Tangible book value per share represents stockholders’ equity less goodwill divided by outstanding shares, excluding unallocated ESOP shares.

ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES

AVERAGE BALANCE SHEETS
(Dollars in Thousands)

	For the Three Months Ended September 30,
	2006							2005
	Average Balance		Interest		Average Yield/ Cost (Annualized)			Average Balance		Interest		Average Yield/ Cost (Annualized)
Assets:
Interest-earning assets:
Mortgage loans (1):
One-to-four family	$	9,952,037	$	127,735		5.13	%	$	9,471,378	$	115,118		4.86	%
Multi-family, commercial real estate and construction		4,268,318		65,933		6.18			3,930,711		60,951		6.20
Consumer and other loans(1)		468,436		9,099		7.77			529,622		8,199		6.19
Total loans		14,688,791		202,767		5.52			13,931,711		184,268		5.29
Mortgage-backed and other securities(2)		5,774,554		64,946		4.50			7,378,492		82,072		4.45
Repurchase agreements		95,969		1,266		5.28			122,585		1,056		3.45
Federal Home Loan Bank stock		142,998		2,049		5.73			123,199		1,577		5.12
Total interest-earning assets		20,702,312		271,028		5.24			21,555,987		268,973		4.99
Goodwill		185,151							185,151
Other non-interest-earning assets		778,978							878,590
Total assets	$	21,666,441						$	22,619,728
Liabilities and stockholders’ equity:
Interest-bearing liabilities:
Savings	$	2,277,608		2,309		0.41		$	2,710,873		2,744		0.40
Money market		506,959		1,281		1.01			767,711		1,866		0.97
NOW and demand deposit		1,482,642		218		0.06			1,565,633		233		0.06
Liquid certificates of deposit		1,243,914		15,184		4.88			393,735		3,053		3.10
Total core deposits		5,511,123		18,992		1.38			5,437,952		7,896		0.58
Certificates of deposit		7,505,903		83,111		4.43			7,222,728		64,007		3.54
Total deposits		13,017,026		102,103		3.14			12,660,680		71,903		2.27
Borrowings		7,045,962		78,258		4.44			8,247,037		78,534		3.81
Total interest-bearing liabilities		20,062,988		180,361		3.60			20,907,717		150,437		2.88
Non-interest-bearing liabilities		344,467							326,857
Total liabilities		20,407,455							21,234,574
Stockholders’ equity		1,258,986							1,385,154
Total liabilities and stockholders’ equity	$	21,666,441						$	22,619,728
Net interest income/net interest rate spread			$	90,667		1.64	%			$	118,536		2.11	%
Net interest-earning assets/net interest margin	$	639,324				1.75	%	$	648,270				2.20	%
Ratio of interest-earning assets to interest- bearing liabilities		1.03x							1.03x

(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.

ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES

AVERAGE BALANCE SHEETS
(Dollars in Thousands)

	For the Nine Months Ended September 30,
	2006							2005
	Average Balance		Interest		Average Yield/ Cost (Annualized)			Average Balance		Interest		Average Yield/ Cost (Annualized)
Assets:
Interest-earning assets:
Mortgage loans(1):
One-to-four family	$	9,921,036	$	378,226		5.08	%	$	9,362,018	$	339,598		4.84	%
Multi-family, commercial real estate and construction		4,192,095		192,178		6.11			3,813,944		177,447		6.20
Consumer and other loans(1)		488,223		26,918		7.35			527,298		22,455		5.68
Total loans		14,601,354		597,322		5.45			13,703,260		539,500		5.25
Mortgage- backed and other securities(2)		6,098,527		205,373		4.49			7,962,719		264,520		4.43
Repurchase agreements		145,121		5,205		4.78			184,637		3,866		2.79
Federal Home Loan Bank stock		141,577		5,535		5.21			130,618		4,400		4.49
Total interest- earning assets		20,986,579		813,435		5.17			21,981,234		812,286		4.93
Goodwill		185,151							185,151
Other non- interest- earning assets		788,337							863,831
Total assets	$	21,960,067						$	23,030,216
Liabilities and stockholders’ equity:
Interest- bearing liabilities:
Savings	$	2,380,057		7,164		0.40		$	2,802,298		8,417		0.40
Money market		563,485		4,135		0.98			843,232		5,825		0.92
NOW and demand deposit		1,512,951		662		0.06			1,574,350		698		0.06
Liquid certificates of deposit		981,897		32,636		4.43			288,023		5,998		2.78
Total core deposits		5,438,390		44,597		1.09			5,507,903		20,938		0.51
Certificates of deposit		7,513,758		230,760		4.09			7,054,729		182,990		3.46
Total deposits		12,952,148		275,357		2.83			12,562,632		203,928		2.16
Borrowings		7,375,315		234,549		4.24			8,757,579		243,262		3.70
Total interest- bearing liabilities		20,327,463		509,906		3.34			21,320,211		447,190		2.80
Non-interest- bearing liabilities		345,408							334,032
Total liabilities		20,672,871							21,654,243
Stockholders’ equity		1,287,196							1,375,973
Total liabilities and stockholders’ equity	$	21,960,067						$	23,030,216
Net interest income/net interest rate spread			$	303,529		1.83	%			$	365,096		2.13	%
Net interest- earning assets/net interest margin	$	659,116				1.93	%	$	661,023				2.21	%
Ratio of interest- earning assets to interest- bearing liabilities		1.03x							1.03x

(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.

ASTORIA FINANCIAL CORPORATION AND SUBSIDIARIES

END OF PERIOD BALANCES AND RATES
(Dollars in Thousands)

	At September 30, 2006					At June 30, 2006					At September 30, 2005
			Weighted Average Balance Rate(1)					Weighted Average Balance Rate(1)					Weighted Average Balance Rate(1)
Selected interest- earning assets: Mortgage loans, gross(2):
One-to-four family	$	9,931,184		5.40	%	$	9,824,066		5.32	%	$	9,509,514		5.13	%
Multi-family, commercial real estate and construction		4,268,679		5.96			4,245,697		5.95			3,991,029		5.85
Mortgage-backed and other securities(3)		5,598,523		4.34			5,870,733		4.34			7,088,515		4.35
Interest-bearing liabilities:
Savings		2,209,535		0.40			2,352,923		0.40			2,636,201		0.40
Money market		478,932		1.00			537,602		1.01			729,552		0.97
NOW and demand deposit		1,466,725		0.06			1,535,833		0.06			1,547,769		0.06
Liquid certificates of deposit		1,402,562		5.05			1,117,478		4.54			479,372		3.29
Total core deposits		5,557,754		1.54			5,543,836		1.20			5,392,894		0.64
Certificates of deposit		7,619,252		4.54			7,548,396		4.26			7,412,756		3.58
Total deposits		13,177,006		3.27			13,092,232		2.96			12,805,650		2.34
Borrowings, net		6,824,359		4.38			7,202,662		4.29			8,099,498		3.84

(1)	Weighted average rates represent stated or coupon interest rates excluding the effect of yield adjustments for premiums, discounts and deferred loan origination fees and costs and the impact of prepayment penalties.
(2)	Mortgage loans exclude loans held-for-sale and include non-performing loans.
(3)	Securities available-for-sale are reported at fair value and securities held-to-maturity are reported at amortized cost.

RECONCILIATION OF 2006 GAAP NET INCOME TO NON-GAAP EARNINGS
(In Thousands, Except Per Share Data)

	For the Nine Months Ended September 30, 2006
	GAAP		Adjustments(4)		Non-GAAP
Net interest income after provision for loan losses	$	303,529	$	—	$	303,529
Non-interest income		67,488		5,456		72,944
Non-interest expense		164,843		—		164,843
Income before income tax expense		206,174		5,456		211,630
Income tax expense		68,383		1,810		70,193
Net income	$	137,791	$	3,646	$	141,437
Basic earnings per common share	$	1.44	$	0.04	$	1.48
Diluted earnings per common share	$	1.40	$	0.04	$	1.44

(4) Adjustments relate to the $5.5 million charge for the termination of our interest rate swap agreements and the related tax effects.

SOURCE  Astoria Financial Corporation
          -0-                                        10/19/2006
          /CONTACT:  Peter J. Cunningham, First Vice President, Investor Relations, +1-516-327-7877, ir@astoriafederal.com/
          /Company News On-Call:  http://www.prnewswire.com/comp/104529.html /
          /Web site:  http://www.astoriafederal.com
                           http://ir.astoriafederal.com /
          (AF)