Signature Bank
Apr 27, 2007

Signature Bank Reports 2007 First Quarter Results

NEW YORK ... April 27, 2007 ... Signature Bank (Nasdaq: SBNY), a New York-based full-service commercial bank, today announced results for its 2007 first quarter ended March 31, 2007.

Net income for the quarter reached $9.3 million or $0.31 diluted earnings per share, an increase of 17.1 percent when compared with $8.0 million or $0.27 diluted earnings per share reported in the first quarter last year. The increase in net income is primarily attributable to expanding net interest margins resulting from an increase in loans as a percentage of total assets and contained deposit costs.

Net interest income totaled $33.7 million for the quarter, an increase of $4.6 million or 15.8 percent, compared to the same period last year. Total assets increased $691.2 million, or 15.4 percent, to $5.19 billion at the end of the first quarter compared with $4.49 billion at the end of the 2006 first quarter.

Deposits for the first quarter decreased $244.0 million and totaled $3.97 billion at March 31, 2007. Excluding short-term escrow deposits of approximately $550 million at December 31, 2006 and about $122 million at the end of the 2007 first quarter, deposits increased approximately $184 million, or 5.0 percent for the quarter. The overall deposit growth represents an increase of $643.0 million, or 19.3 percent, when compared with deposits at March 31, 2006.

"During the first quarter, we again demonstrated our ability to achieve solid growth in our core deposits as well as in our loan portfolio, which increased by nearly $90 million. This is a testament to the single-minded focus on our clients that we tackle from every level, including senior management, support staff and the bankers," said Joseph J. DePaolo, President and Chief Executive Officer.

"The footprint of the Bank continues to expand. We appointed two new teams, one of which spurred the opening of a new office in Great Neck, marking our fifth office on Long Island and 19th in total across metro-N.Y. We also added several professionals to other established teams during the quarter. The market offers many prospects for the recruitment of new teams as well as the addition of professionals to existing groups. We continue to seize every opportunity to identify bankers and lenders who complement our growing network, which, at quarter-end was at 49 private client banking teams headed by 63 Group directors," DePaolo remarked.

Scott A. Shay, Chairman of the Board, added: "Our continued, prudent management of the balance sheet allowed us to again expand margins during a tough interest rate environment. Our ability to grow loans as a percentage of total assets and our relationship-based deposit pricing provide the foundation to successfully compete in today's highly competitive banking arena. Soon, the Bank will mark its six-year anniversary, and the growth we have realized in such a short time is evidence of our ongoing success in identifying, attracting and retaining the right bankers who can meet the needs of our clients."

Net Interest Income

Net interest income for the first quarter 2007 was $33.7 million, an increase of $4.6 million, or 15.8 percent, from the same quarter last year. Average interest earning assets for the first quarter of 2007 increased by $636.4 million, which reflects a 15.2 percent increase from the first quarter 2006. Asset yields for the first quarter of 2007 grew 63 basis points to 5.86 percent, versus the first quarter of 2006, as a result of higher short-term rates, more favorable market conditions and an increase in loans as a percentage of average interest earning assets. During the first quarter of 2007, the average cost of funds and deposits increased by 63 and 58 basis points to 3.13 and 2.67 percent, respectively, when compared with the 2006 first quarter. The increase in the cost of funds and deposits is reflective of the competitive marketplace. The net interest margin for the first quarter of 2007 increased one basis point to 2.83 percent, versus the same period last year. On a linked quarter basis, net interest margin grew three basis points predominantly due to the increase in loans as a percentage of total assets and contained deposit costs.

The net interest margin continues to be impacted by the prolonged difficult interest rate environment of the flat to inverted yield curve and a competitive deposit market. Net interest margin expansion in future periods will remain dependent upon continued core deposit and loan growth. Additionally, large movements in short-term escrow deposits can result in considerable changes in margins in any given quarter.

Non-Interest Income and Non-Interest Expense

Non-interest income for the first quarter of 2007 was $6.8 million, an increase of $2.0 million or 41.3 percent, versus $4.8 million reported in the comparable period a year ago. This was largely the result of commissions associated with large off-balance sheet escrow deposits.

Non-interest expense for the 2007 first quarter was $23.3 million, compared with $19.5 million in the same period last year. This increase was primarily due to the addition of new private client banking teams and locations as well as increased growth in client activity.

The Bank's efficiency ratio remained relatively flat at 57.5 percent for first quarter 2007, versus 57.3 percent for the 2006 first quarter primarily due to the growth in salaries and benefits from the addition of new private client teams.

Loans

For the 2007 first quarter, loans, excluding loans held for sale, increased $87.6 million or 5.6 percent to $1.67 billion at March 31, 2007, compared with $1.58 billion at December 31, 2006. At March 31, 2007, loans to total assets were at 32.1 percent, versus 29.2 percent at December 31, 2006. Average loans, excluding loans held for sale, for the 2007 first quarter increased $148.9 million, or 10.2 percent, to $1.6 billion.

Loans held for sale were $152.7 million as of March 31, 2007, an increase of $26.7 million or 21.2 percent from December 31, 2006. The periodic fluctuation in loans held for sale is predominantly due to the timing of SBA loan purchases and subsequent pool sales. At March 31, 2007, non-performing loans decreased to $5.7 million from $8.8 million at December 31, 2006, representing 0.34 percent of total loans. A recently reported non-performing loan was paid off in January 2007, and represents a $3.7 million reduction in non-performing loans and a charge-off of approximately $800,000 for the quarter.

Capital

Signature Bank's capital ratios remain strong. The Bank's tier 1 risk-based, total risk-based and leverage capital ratios were approximately 16.74 percent, 17.31 percent and 8.20 percent, respectively, as of March 31, 2007, well in excess of regulatory requirements. The ratios reflect the relatively low risk profile of the balance sheet.

DePaolo, reflecting on the Bank's quarterly performance and also looking ahead to the future, noted: "While the rapidly consolidating industry landscape remains fiercely competitive and the interest rate environment extremely challenging, we thrive by following our philosophy -- to recruit highly talented banking teams that consistently drive core deposit and loan growth. This quarter was no exception in our ability to execute our plan and take advantage of the many market opportunities. This is undoubtedly our top priority."

Conference Call

Signature Bank's management will host a conference call to review results of the 2007 first quarter on Friday, April 27, 2007, at 10:00 AM ET. Participants should dial 800-218-8862 at least ten minutes prior to the start of the call. International callers should dial 303-262-2139.

To hear a live web simulcast or to listen to the archived web cast following completion of the call, please visit the Bank's web site at www.signatureny.com, click on the "Investor Relations" tab, then select "Company News," followed by "Conference Calls," to access the link to the call. To listen to a telephone replay of the conference call, please dial 303-590-3000 and enter reservation identification number 11088617. The replay will be available from approximately 1:00 PM ET on Friday, April 27, 2007, through 11:59 PM ET on Wednesday, May 2, 2007.

About Signature Bank

Signature Bank, member FDIC, is a New York-based full-service commercial bank with 19 private client offices located in the New York metropolitan area, serving the needs of privately owned businesses, their owners and senior managers through dozens of private client groups. The Bank offers a wide variety of business and personal banking products and services as well as investment, brokerage, asset management and insurance products and services through its subsidiary, Signature Securities Group Corporation, a licensed broker-dealer, investment adviser and member NASD/SIPC.

Signature Bank's 19 offices are located throughout the metropolitan New York area. In Manhattan – 261 Madison Avenue; 300 Park Avenue; 71 Broadway; 565 Fifth Avenue; 950 Third Avenue; 200 Park Avenue South and 1020 Madison Avenue. Brooklyn - 26 Court Street and 84 Broadway. Westchester – 1C Quaker Ridge Road, New Rochelle and 360 Hamilton Avenue, White Plains. Long Island – 1225 Franklin Avenue, Garden City; 279 Sunrise Highway, Rockville Centre; 58 South Service Road, Melville; 923 Broadway, Woodmere and 40 Cuttermill Road in Great Neck. Queens – 36-36 33rd Street, Long Island City and 78-27 37th Avenue, Jackson Heights. Bronx – 421 Hunts Point Avenue, Bronx.

For more information, please visit www.signatureny.com.

This press release and oral statements made from time to time by our representatives contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 that are subject to risks and uncertainties. Forward-looking statements include information concerning our future results, interest rates, loan and deposit growth, operations, new private client team hires, new office openings and business strategy. These statements often include words such as "may," "believe," "expect," "anticipate," "intend," "plan," "estimate" or other similar expressions. As you consider forward-looking statements, you should understand that these statements are not guarantees of performance or results. They involve risks, uncertainties and assumptions that could cause actual results to differ materially from those in the forward-looking statements. These factors include but are not limited to: (i) prevailing economic conditions; (ii) changes in interest rates, loan demand, real estate values, and competition, which can materially affect origination levels and gain on sale results in our business, as well as other aspects of our financial performance; (iii) the level of defaults, losses and prepayments on loans made by us, whether held in portfolio or sold in the whole loan secondary markets, which can materially affect charge-off levels and required credit loss reserve levels; and (iv) competition for qualified personnel and desirable office locations. Additional risks are described in our quarterly and annual reports filed with the FDIC. You should keep in mind that any forward-looking statements made by Signature Bank speak only as of the date on which they were made. New risks and uncertainties come up from time to time, and we cannot predict these events or how they may affect the Bank. Signature Bank has no duty to, and does not intend to, update or revise the forward-looking statements after the date on which they are made. In light of these risks and uncertainties, you should keep in mind that any forward-looking statement made in this release or elsewhere might not reflect actual results.

For Further Information:
Investor Contact:
Eric R. Howell, Chief Financial Officer
646-822-1402, ehowell@signatureny.com

Media Contact:
Susan J. Lewis, 646-822-1825, slewis@signatureny.com