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Sound Federal Bancorp, Inc. Announces Fourth Fiscal Quarter and Year-End Earnings.

Article Excerpt
WHITE PLAINS, N.Y., April 28 /PRNewswire-FirstCall/ -- Sound Federal Bancorp, Inc. (the "Company"), the holding company for Sound Federal Savings (the "Bank"), announced net income of $635,000 or diluted earnings per share of $0.05 for the quarter ended March 31, 2006 as compared to $1.12 million or diluted earnings per share of $0.10 for the quarter ended March 31, 2005. Net income for the quarter ended March 31, 2006 included $480,000 of merger costs related to the Company's announced merger with Hudson City Bancorp, Inc. A substantial majority of these costs are not tax deductible. Excluding merger costs, net income amounted to $1.09 million for the fourth fiscal quarter. The $480,000 decrease in net income for the quarter ended March 31, 2006 as compared to the same quarter in 2005 was primarily due to an $885,000 increase in non-interest expense, including the merger-related costs, partially offset by a $446,000 increase in net interest income. For the year ended March 31, 2006, net income amounted to $4.16 million or diluted earnings per share of $0.35, as compared to $5.47 million or diluted earnings per share of $0.46 for fiscal 2005, a decrease of $1.31 million or 23.9% in net income. Excluding merger costs totaling $541,000 incurred during fiscal year 2006, net income amounted to $4.66 million. The decrease in net income for the year ended March 31, 2006 is primarily attributable to a $2.6 million increase in non-interest expense, including the merger-related costs, partially offset by increases of $408,000 in non- interest income and $398,000 in net interest income, and a $530,000 decrease in income tax expense.

Bruno J. Gioffre, Chairman of the Board, commented, "Net income for the quarter, excluding merger costs of $480,000, was $1.09 million. The flat yield curve continues to affect our earnings. Our net interest margin decreased 34 basis points to 2.57% for fiscal year 2006. However, our ability to originate loans and increase deposits enabled us to increase net interest income by 1.5% despite the reduction in net interest margin. During fiscal 2006, we increased the size of our loan portfolio by 32.2% and our deposit balances by 20.7%."

Mr. Gioffre continued, "As we previously announced, the Company entered into a merger agreement with Hudson City Bancorp, Inc. This transaction provides our stockholders $20.75 in cash for each share of Sound Federal Bancorp, Inc. common stock they...