Dime Community Bancshares, Inc. Reports Earnings

BROOKLYN, NY--(Marketwired - Apr 24, 2014) - Dime Community Bancshares, Inc. (NASDAQ: DCOM) (the "Company" or "Dime"), the parent company of The Dime Savings Bank of Williamsburgh (the "Bank"), today reported financial results for the quarter ended March 31, 2014. Consolidated net income for the quarter ended March 31, 2014 was $10.0 million, or $0.28 per diluted share, compared to $10.3 million, or $0.29 per diluted share, for the quarter ended December 31, 2013, and $10.6 million, or $0.30 per diluted share, for the quarter ended March 31, 2013.

Vincent F. Palagiano, Chairman and Chief Executive Officer of Dime, commented, "We are pleased to report another solid quarter of earnings, despite compressing margins and a highly competitive lending environment." Mr. Palagiano continued, "During the most recent quarter, we capitalized on a unique opportunity to repurchase a large portfolio of performing loans from a third party investor. The repurchase was appealing to us due to the relatively short duration of the assets being acquired, as well as our familiarity with their underwriting and credit quality, and puts us well on our way to achieving our growth target for the year."

During the quarter ended March 31, 2014, as previously mentioned, the Company repurchased from a third-party investor approximately $200 million of fully performing multifamily loans that were originated by Dime between 2002 and 2009. There was no transfer of servicing rights in connection with the repurchase since Dime was servicing the loans. This acquisition helped generate asset growth of 6.3% during the first quarter of 2014, putting Dime solidly on its path toward meeting its 8% to 10% balance sheet growth target for 2014. Credit quality remains excellent, with non-performing loans approximating 32 basis points of total loans, and delinquencies between 30 and 89 days approximating only 1 basis point of total loans.

"And on another note," continued Mr. Palagiano, "I want to add how proud the employees and directors of Dime are to be affiliated with this Bank as it reached a significant milestone on April 19th, 2014, the 150th anniversary of the date of incorporation of The Dime Savings Bank of Williamsburgh. In 1864, local community leaders formed a mutual savings bank in Williamsburg primarily to encourage thrift among people of modest means. Today that bank, now shareholder-owned, is the largest bank still headquartered in Brooklyn, continuing to deliver what customers want most: personal service, trust, and stability. Thank you for being part of the story with us."

Management's Discussion of Quarterly Operating Results

• Net Interest Margin

As previously forecasted, net interest margin ("NIM") continues to contract, resulting from the wave of refinancing activity that began in late 2012 and continues today, albeit at a declining rate. Reported NIM was 3.06% during the quarter ended March 31, 2014 compared to 3.24% during the December 2013 quarter. The "core" NIM, which excludes the effect of loan prepayment fee income, decreased from 2.90% during the December 2013 quarter to 2.79% during the March 2014 quarter, caused primarily by a reduction of 16 basis points in the average yield on real estate loans. Both loan amortization activity and prepayment fee income moderated somewhat during the quarter ended March 31, 2014, compared to their historically high levels during 2013, consistent with the forecast provided in the Outlook section of the Company's January 27, 2014 earnings release.

Competition for multifamily loans in the New York metropolitan market continued to keep new loan rates low during the quarter, even as the benchmark Treasury rates moved slightly higher. During the most recent quarter, prime, low loan-to-value multifamily offering rates ranged from 3.25% to 3.75% for a 5 or 7-year repricing term. Generally, borrowers expressed a preference for a 7-year repricing term, despite the higher interest rate and debt service compared to the 5-year repricing term.

Partially offsetting the lower asset yields was a reduction of 4 basis points in the average overall cost of funds. A 46 basis point decrease in the average cost of borrowings drove this decline, as Dime continued to avail itself of favorable wholesale borrowing rates. The cost of deposits rose slightly, reflecting new deposit volumes at the start of the promotional deposit season.

• Net Interest Income

Net interest income was $30.3 million in the quarter ended March 31, 2014, down $512,000 from $30.8 million reported in the December 2013 quarter, and down $2.0 million from $32.3 million reported in the March 2013 quarter. Prepayment fee income on loans totaled $2.7 million during the March 2014 quarter, compared to $3.2 million recognized in the December 2013 quarter accounting for the linked quarter $512,000 decline in net interest income.

• Provision/Allowance For Loan Losses

The Company experienced net charge-offs of $6,000 during the quarter ended March 31, 2014, and recorded a provision of $281,000 to the allowance for loan losses, resulting in a net addition of $276,000 to the allowance for loan losses from December 31, 2013 to March 31, 2014. The $281,000 provision recorded during the most recent quarter reflected the growth in the Bank's loan portfolio during the period.

As a result of the growth in the loan portfolio, the allowance for loan losses as a percentage of total loans declined from 0.54% at December 31, 2013 to 0.52% at March 31, 2014.

• Non-Interest Income

Non-interest income was $3.1 million for the quarter ended March 31, 2014, an increase of $1.2 million from the previous quarter.

The loans repurchased during the quarter ended March 31, 2014 had been subject to a "First Loss Position" recourse provision. As a result of the repurchase, the liability for the first loss position approximating $1.0 million that had previously been recorded was reversed. This reversal was recognized as mortgage banking income (a component non-interest income) during the March 2014 quarter.

During the quarter ended March 31, 2014, Dime also recognized a non-recurring gain of $649,000 on the sale of a real estate property.

Partially offsetting these items were reductions of approximately $150,000 in mortgage banking servicing fee income during the quarter ended March 31, 2014, reflecting the reduction in the serviced loan portfolio during the period.

• Non-Interest Expense

Non-interest expense was $15.8 million in the quarter ended March 31, 2014, exceeding the forecasted level of $15.5 million as a result of higher seasonal marketing costs.

Non-interest expense was 1.53% of average assets during the most recent quarter. The efficiency ratio approximated 48.5% during the same period.

• Income Tax Expense

The effective tax rate approximated 41.7% during the most recent quarter, generally in line with the 41.0% forecasted level.

Management's Discussion of the 1^st Quarter 2014 Balance Sheet

Total assets were $4.28 billion at March 31, 2014, up $252.2 million, or 6.3%, from December 31, 2013.

The total real estate loan portfolio grew by approximately $246.1 million, due primarily to the repurchase of approximately $200 million of loans during the period.

New real estate portfolio originations were $216.3 million during the most recent quarter (excluding the previously discussed whole loan repurchase transaction), compared to $213.8 million experienced during the 4^th quarter of 2013. For further comparative and trending purposes, real estate loan originations in the 2^nd and 3^rd quarters of 2013 were $325.6 million and $289.6 million, respectively, although amortizations and satisfactions were also higher during those periods.

Federal Home Loan Bank of New York ("FHLBNY") advances increased by $123.2 million during the quarter ended March 31, 2014, providing the largest single component of funding for the loan growth experienced during the period. Deposits also grew by $79.8 million during the most recent quarter, driven by successful promotional certificate of deposit ("CD") and money market programs. Mortgagor escrow deposit growth of $40.7 million during the quarter ended March 31, 2014 provided another recurring source of funding.

• Real Estate Loans

As previously discussed, real estate loans increased $246.1 million during the quarter ended March 31, 2014. Real estate loan originations were $216.3 million during the March 2014 quarter, at a weighted average interest rate of 3.68%. Of this amount, $75.0 million represented loan refinances from the existing portfolio.

Also during the quarter, loan amortization and satisfactions, including the $75.0 million of refinances of existing loans, totaled $178.4 million, or 18.7% (annualized) of the quarterly average portfolio balance, at an average rate of 5.11%. Total loan commitments stood at $117.0 million at March 31, 2014, with a weighted average rate of 3.81%. The average yield on the loan portfolio (excluding prepayment fee income) during the quarter ended March 31, 2014 was 4.00%, compared to 4.16% during the December 2013 quarter and 4.65% during the March 2013 quarter.

• Credit Summary

Non-performing loans were $12.8 million, or 0.32% of total loans, at March 31, 2014, compared to $12.5 million, or 0.34% of total loans, at December 31, 2013. The increase in dollar amount resulted primarily from the addition of one non-performing loan during the period. Accruing loans delinquent between 30 and 89 days decreased to $470,000, or approximately 0.01% of total loans, at March 31, 2014, compared to $1.6 million, or 0.04% of total loans, at December 31, 2013. All of the loans included in the $200 million loan repurchase during the most recent quarter remained current as of March 31, 2014.

At March 31, 2014, non-performing assets represented 4.0% of the sum of tangible capital plus the allowance for loan losses (this statistic is otherwise known as the "Texas Ratio") (see table on page 11). This number compares very favorably to both industry and regional averages.

• Deposits and Borrowed Funds

Retail deposits increased $79.8 million from December 31, 2013 to March 31, 2014, reflecting net growth of $38.8 million in money market deposits and $40.0 million in CDs (primarily 5-year CDs) during the period. The Bank continued to gather money markets and CDs utilizing promotional activities tied to non-interest bearing checking relationships. At March 31, 2014, bank-wide average deposit balances approximated $103.5 million per branch.

On a net basis, FHLBNY advances grew by $123.2 million during the quarter ended March 31, 2014. As a component of total borrowing activities during the March 2014 quarter, the Bank added $208.2 million of new fixed-rate, long-term FHLBNY advances, with a weighted average life approximating 4.0 years and a weighted average cost of 1.49%. The Bank intends to continue the use of longer-term FHLBNY advances to supplement deposit funding and to help mitigate its interest rate risk profile against stressed rate conditions. Some residual borrowing activity during the quarter was short-term in nature in order to manage near-term cash flows.

• Capital

While tangible capital grew during the quarter ended March 31, 2014, the Company's consolidated Tier 1 core leverage ratio (tangible common equity) declined during the period as a result of the $252.2 million growth in assets. Consolidated tangible capital was 9.25% of tangible assets at March 31, 2014, a reduction of 43 basis points from December 31, 2013.

The Bank's tangible (leverage) capital ratio was 9.22% at March 31, 2014, down from 9.52% at December 31, 2013, also due to asset growth during the March 2014 quarter. The Bank's Total Risk-Based Capital Ratio was 13.13% at March 31, 2014, compared to 13.36% at December 31, 2013.

Reported diluted EPS exceeded the quarterly cash dividend rate per share by 100% during the quarter ended March 31, 2014, equating to a 50% payout ratio. Additions to capital from earnings during the most recent quarterly period enabled tangible book value per share to increase $0.17 sequentially during the most recent quarter, to $10.64 at March 31, 2014.

OUTLOOK FOR THE QUARTER ENDING JUNE 30, 2014

At March 31, 2014, Dime had outstanding loan commitments totaling $117.0 million, all of which are likely to close during the quarter ending June 30, 2014, at an average interest rate approximating 3.81%. Absent the recognition of significant prepayment income, the average yield on the $200 million of repurchased loans should approximate 3.5%.

Balance sheet growth remains targeted to approximate 8.0% - 10.0% for the year ending December 31, 2014. This target remains subject to change to reflect market conditions. Loan prepayments and amortization are currently projected to run in the 15% - 20% range throughout the year.

On the funding side of the balance sheet, deposit funding costs are expected to remain near current historically low levels through the second quarter of 2014. The Bank has $141.6 million of CDs maturing at an average cost of 1.13% during the quarter ending June 30, 2014. Offering rates on 12-month term CDs currently approximate 50 basis points. The Company has $15.0 million in short-term borrowings due to mature during the quarter ending June 30, 2014. In the coming quarter, management expects to utilize a combination of FHLBNY advances and retail deposits to fund growth. Advances are anticipated to be a combination of both short-term and longer duration (3 to 5 year fixed terms) to meet various funding strategies.

The Bank anticipates continuing promotional deposit campaigns throughout the second quarter of 2014, the success of which will determine the direction and degree of both deposit and borrowings funding, as well as the overall cost of funds for the June 2014 quarter.

Loan loss provisioning will likely continue to be a function of annualized loan portfolio growth, incurred and anticipated losses, and the overall credit quality of the loan portfolio.

Absent any unforeseen items, non-interest expense is expected to approximate $15.8 million during the June 2014 quarter. The Company projects that the consolidated effective tax rate will approximate 41.0% in the June 2014 quarter.

ABOUT DIME COMMUNITY BANCSHARES, INC.

The Company (NASDAQ: DCOM) had $4.28 billion in consolidated assets as of March 31, 2014, and is the parent company of the Bank. The Bank was founded in 1864, is headquartered in Brooklyn, New York, and currently has twenty-five branches located throughout Brooklyn, Queens, the Bronx and Nassau County, New York. More information on the Company and Dime can be found on the Dime's Internet website at www.dime.com.

This News Release 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 (the "Exchange Act"). These statements may be identified by use of words such as "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 upon various assumptions and analyses made by the Company in light of management's experience and its perception of historical trends, current conditions and expected future developments, as well as other factors it believes 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 the Company's 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 the Company's 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; changes in deposit flows, loan demand or real estate values may adversely affect the business of Dime; changes in accounting principles, policies or guidelines may cause the Company's financial condition to be perceived differently; changes in corporate and/or individual income tax laws may adversely affect the Company's financial condition or results of operations; general economic conditions, either nationally or locally in some or all areas in which the Company conducts business, or conditions in the securities markets or the banking industry may be less favorable than the Company currently anticipates; legislation or regulatory changes may adversely affect the Company's business; technological changes may be more difficult or expensive than the Company anticipates; success or consummation of new business initiatives may be more difficult or expensive than the Company anticipates; or litigation or other matters before regulatory agencies, whether currently existing or commencing in the future, may delay the occurrence or non-occurrence of events longer than the Company anticipates.

DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(In thousands except share amounts)
			March 31,				December 31,
			2014				2013
ASSETS:
Cash and due from banks			$	66,120			$	45,777
Investment securities held to maturity				5,324				5,341
Investment securities available for sale				3,654				18,649
Trading securities				6,948				6,822
Mortgage-backed securities available for sale				30,652				31,543
Real Estate Loans:
	One-to-four family and cooperative/condomnium apartment			76,772				73,956
	Multifamily and loans underlying cooperatives (1)			3,170,747				2,917,380
	Commercial real estate			690,398				700,606
	Construction and land acquisition			222				268
	Unearned discounts and net deferred loan fees			5,382				5,170
	Total real estate loans			3,943,521				3,697,380
	Other loans			1,873				2,139
	Allowance for loan losses			(20,429	)			(20,153	)
Total loans, net				3,924,965				3,679,366
Premises and fixed assets, net				26,067				29,701
Federal Home Loan Bank of New York capital stock				53,593				48,051
Other Real Estate Owned				18				18
Goodwill				55,638				55,638
Other assets				107,390				107,284
TOTAL ASSETS			$	4,280,369			$	4,028,190
LIABILITIES AND STOCKHOLDERS' EQUITY:
Deposits:
Non-interest bearing checking			$	176,636			$	174,457
Interest Bearing Checking				83,928				87,301
Savings				379,118				376,900
Money Market				1,078,841				1,040,079
	Sub-total			1,718,523				1,678,737
Certificates of deposit				868,451				828,409
Total Due to Depositors				2,586,974				2,507,146
Escrow and other deposits				110,062				69,404
Federal Home Loan Bank of New York advances				1,033,150				910,000
Trust Preferred Notes Payable				70,680				70,680
Other liabilities				37,868				35,454
TOTAL LIABILITIES				3,838,734				3,592,684
STOCKHOLDERS' EQUITY:
Common stock ($0.01 par, 125,000,000 shares authorized, 52,862,963 shares and 52,854,483 shares issued at March 31, 2014 and December 31, 2013, respectively, and 36,720,170 shares and 35,712,951 shares outstanding at March 31, 2014 and December 31, 2013, respectively)				528				528
Additional paid-in capital				252,680				252,253
Retained earnings				408,009				402,986
Accumulated other comprehensive loss, net of deferred taxes				(4,637	)			(4,759	)
Unallocated common stock of Employee Stock Ownership Plan				(2,718	)			(2,776	)
Unearned Restricted Stock Award common stock				(2,680	)			(3,193	)
Common stock held by the Benefit Maintenance Plan				(9,012	)			(9,013	)
Treasury stock (16,142,793 shares and 16,141,532 shares at March 31, 2014 and December 31, 2013, respectively)				(200,535	)			(200,520	)
TOTAL STOCKHOLDERS' EQUITY				441,635				435,506
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY			$	4,280,369			$	4,028,190

(1)	While the loans within this category are often considered "commercial real estate" in nature, multifamily and loans underlying cooperatives are here reported separately from commercial real estate loans in order to emphasize the residential nature of the collateral underlying this significant component of the total loan portfolio.

DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars In thousands except share and per share amounts)
					For the Three Months Ended
					March 31,			December 31,				March 31,
					2014			2013				2013
Interest income:
	Loans secured by real estate				$	40,861		$	41,303			$	43,148
	Other loans					25			26				25
	Mortgage-backed securities					248			290				459
	Investment securities					70			188				129
	Federal funds sold and other short-term investments					522			422				544
		Total interest income				41,726			42,229				44,305
Interest expense:
	Deposits and escrow					4,621			4,687				5,201
	Borrowed funds					6,850			6,775				6,790
		Total interest expense				11,471			11,462				11,991
			Net interest income			30,255			30,767				32,314
Provision for (recapture of) loan losses						281			(56	)			157
Net interest income after provision for loan losses						29,974			30,823				32,157
Non-interest income:
	Service charges and other fees					655			905				712
	Mortgage banking income, net					999			123				161
	Gain on sale of securities and other assets					649			-				110
	Gain on trading securities					14			78				100
	Other					743			731				815
		Total non-interest income				3,060			1,837				1,898
Non-interest expense:
	Compensation and benefits					9,508			9,578				9,951
	Occupancy and equipment					2,750			2,716				2,532
	Federal deposit insurance premiums					505			480				511
	Other					3,060			2,687				3,315
		Total non-interest expense				15,823			15,461				16,309
		Income before taxes				17,211			17,199				17,746
Income tax expense						7,177			6,891				7,176
Net Income					$	10,034		$	10,308			$	10,570
Earnings per Share ("EPS"):
	Basic				$	0.28		$	0.29			$	0.30
	Diluted				$	0.28		$	0.29			$	0.30
Average common shares outstanding for Diluted EPS						35,889,584			35,717,449				34,879,239

DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED SELECTED FINANCIAL HIGHLIGHTS
(Dollars In thousands except per share amounts)
		For the Three Months Ended
		March 31,				December 31,				March 31,
		2014				2013				2013
Performance Ratios (Based upon Reported Earnings):
Reported EPS (Diluted)		$	0.28			$	0.29			$	0.30
Return on Average Assets			0.97	%			1.03	%			1.07	%
Return on Average Stockholders' Equity			9.12	%			9.62	%			10.63	%
Return on Average Tangible Stockholders' Equity			10.36	%			10.84	%			12.07	%
Net Interest Spread			2.87	%			3.04	%			3.21	%
Net Interest Margin			3.06	%			3.24	%			3.44	%
Non-interest Expense to Average Assets			1.53	%			1.55	%			1.65	%
Efficiency Ratio			48.46	%			47.53	%			47.96	%
Effective Tax Rate			41.70	%			40.07	%			40.44	%
Book Value and Tangible Book Value Per Share:
Stated Book Value Per Share		$	12.03			$	11.86			$	11.16
Tangible Book Value Per Share			10.64				10.47				9.87
Average Balance Data:
Average Assets		$	4,142,607			$	3,997,842			$	3,945,321
Average Interest Earning Assets			3,949,297				3,803,406				3,759,778
Average Stockholders' Equity			440,287				428,396				397,594
Average Tangible Stockholders' Equity			387,595				380,417				350,277
Average Loans			3,821,190				3,667,231				3,507,830
Average Deposits			2,530,509				2,547,115				2,571,771
Asset Quality Summary:
Net charge-offs		$	6			$	331			$	177
Non-performing Loans (excluding loans held for sale)			12,776				12,549				8,172
Non-performing Loans/ Total Loans			0.32	%			0.34	%			0.23	%
Nonperforming Assets (1)		$	13,694			$	13,465			$	9,651
Nonperforming Assets/Total Assets			0.32	%			0.33	%			0.24	%
Allowance for Loan Loss/Total Loans			0.52	%			0.54	%			0.58	%
Allowance for Loan Loss/Non-performing Loans			159.90	%			160.59	%			251.22	%
Loans Delinquent 30 to 89 Days at period end		$	470			$	1,603			$	1,985
Consolidated Tangible Stockholders' Equity to Tangible Assets at period end			9.25	%			9.68	%			9.02	%
Regulatory Capital Ratios (Bank Only):
Tier One Core Leverage Ratio (Tangible Common Equity)			9.22	%			9.52	%			9.97	%
Tier One Risk Based Capital Ratio			12.47	%			12.64	%			13.02	%
Total Risk Based Capital Ratio			13.13	%			13.36	%			13.76	%

(1)	Amount comprised of total non-accrual loans and the recorded balance of pooled bank trust preferred security investments for which the Bank had not received any contractual payments of interest or principal in over 90 days.

DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES

UNAUDITED AVERAGE BALANCES AND NET INTEREST INCOME

(Dollars In thousands)

					For the Three Months Ended
					March 31, 2014						December 31, 2013						March 31, 2013
									Average						Average						Average
					Average				Yield/		Average				Yield/		Average				Yield/
					Balance		Interest		Cost		Balance		Interest		Cost		Balance		Interest		Cost
Assets:
	Interest-earning assets:
		Real estate loans			$3,819,210		$40,861		4.28%		$3,665,008		$41,303		4.51%		$3,505,646		$43,148		4.92%
		Other loans			1,980		25		5.05		2,223		26		4.68		2,184		25		4.58
		Mortgage-backed securities			29,475		248		3.37		31,631		290		3.67		45,477		459		4.04
		Investment securities			29,597		70		0.95		29,048		188		2.59		42,807		129		1.21
		Other short-term investments			69,035		522		3.02		75,496		422		2.24		163,664		544		1.33
			Total interest earning assets		3,949,297		$41,726		4.23%		3,803,406		$42,229		4.44%		3,759,778		$44,305		4.71%
	Non-interest earning assets				193,310						194,436						185,543
Total assets					$4,142,607						$3,997,842						$3,945,321
Liabilities and Stockholders' Equity:
	Interest-bearing liabilities:
		Interest Bearing Checking accounts			$84,965		$59		0.28%		$89,293		$47		0.21%		$93,219		$70		0.30%
		Money Market accounts			1,052,680		1,315		0.51		1,063,748		1,343		0.50		1,059,236		1,490		0.57
		Savings accounts			377,705		46		0.05		376,965		47		0.05		375,374		101		0.11
		Certificates of deposit			842,130		3,201		1.54		842,099		3,250		1.53		881,883		3,540		1.63
			Total interest bearing deposits		2,357,480		4,621		0.79		2,372,105		4,687		0.78		2,409,712		5,201		0.88
		Borrowed Funds			1,051,784		6,850		2.64		867,438		6,775		3.10		837,402		6,790		3.29
			Total interest-bearing liabilities		3,409,264		$11,471		1.36%		3,239,543		$11,462		1.40%		3,247,114		$11,991		1.50%
	Non-interest bearing checking accounts				173,029						175,010						162,059
	Other non-interest-bearing liabilities				120,027						154,893						138,554
			Total liabilities		3,702,320						3,569,446						3,547,727
	Stockholders' equity				440,287						428,396						397,594
Total liabilities and stockholders' equity					$4,142,607						$3,997,842						$3,945,321
Net interest income							$30,255						$30,767						$32,314
Net interest spread									2.87%						3.04%						3.21%
Net interest-earning assets					$540,033						$563,863						$512,664
Net interest margin									3.06%						3.24%						3.44%
Ratio of interest-earning assets to interest-bearing liabilities							115.84%						117.41%						115.79%
Deposits (including non-interest bearing checking accounts)					$2,530,509		$4,621		0.74%		$2,547,115		$4,687		0.73%		$2,571,771		$5,201		0.82%
SUPPLEMENTAL INFORMATION
Loan prepayment and late payment fee income							$2,675						$3,216						$2,360
Real estate loans (excluding prepayment and late payment fees)									4.00%						4.16%						4.65%
Interest earning assets (excluding prepayment and late payment fees)									3.96%						4.10%						4.46%
Net Interest income (excluding loan prepayment and late payment fees)							$ 27,580						$ 27,551						$ 29,954
Net Interest margin (excluding loan prepayment and late payment fees)									2.79%						2.90%						3.19%

DIME COMMUNITY BANCSHARES, INC. AND SUBSIDIARIES
UNAUDITED SCHEDULE OF NON-PERFORMING ASSETS AND TROUBLED DEBT RESTRUCTURINGS ("TDRs")
(Dollars In thousands)
			At March 31,			At December 31,			At March 31,
Non-Performing Loans			2014			2013			2013
	One- to four-family and cooperative/condominium apartment		$	1,382		$	1,242		$	697
	Multifamily residential and mixed use residential real estate (1)(2)			1,271			1,197			809
	Mixed use commercial real estate (2)			4,400			4,400			1,159
	Commercial real estate			5,707			5,707			5,500
	Other			16			3			7
Total Non-Performing Loans (3)			$	12,776		$	12,549		$	8,172
Other Non-Performing Assets
	Other real estate owned			18			18			585
	Pooled bank trust preferred securities (4)			900			898			894
Total Non-Performing Assets			$	13,694		$	13,465		$	9,651
TDRs not included in non-performing loans (3)
	One- to four-family and cooperative apartment			930			934			944
	Multifamily residential and mixed use residential real estate (1)(2)			1,137			1,148			1,538
	Mixed use commercial real estate (2)			-			-			724
	Commercial real estate			16,458			16,538			38,238
Total Performing TDRs			$	18,525		$	18,620		$	41,444

(1)	Includes loans underlying cooperatives.
(2)	While the loans within these categories are often considered "commercial real estate" in nature, they are classified separately in the table above to provide further emphasis of the discrete composition of their underlying real estate collateral.
(3)	Total non-performing loans include some loans that were modified in a manner that met the criteria for a TDR. These non-accruing TDRs, which totaled $5,707 at March 31, 2014, $5,707 at December 31, 2013 and $5,895 at March 31, 2013, are included in the non-performing loan table, but excluded from the TDR amount shown above.
(4)	These assets were deemed non-performing since the Company had, as of the dates indicated, not received any payments of principal or interest on them for a period of at least 90 days.

PROBLEM ASSETS AS A PERCENTAGE OF TANGIBLE CAPITAL AND RESERVES
			At March 31,				At December 31,				At March 31,
			2014				2013				2013
Total Non-Performing Assets			$	13,694			$	13,465			$	9,651
Loans 90 days or more past due on accrual status (5)				2,699				1,031				186
	TOTAL PROBLEM ASSETS		$	16,393			$	14,496			$	9,837
Tier One Capital - The Dime Savings Bank of Williamsburgh			$	388,341			$	376,717			$	390,129
Allowance for loan losses				20,429				20,153				20,530
	TANGIBLE CAPITAL PLUS RESERVES		$	408,770			$	396,870			$	410,659
PROBLEM ASSETS AS A PERCENTAGE OF TANGIBLE CAPITAL AND RESERVES				4.0	%			3.7	%			2.4	%

(5)	These loans were, as of the respective dates indicated, expected to be either satisfied, made current or re-financed within the following twelve months, and were not expected to result in any loss of contractual principal or interest. These loans are not included in non-performing loans.