##### Table of Contents



SECURITIES
AND EXCHANGE COMMISSION
 450 Fifth Street, N.W.
Washington, D.C. 20549
 Form 10-K
 o
    
    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the Six Months Ended December 31, 2009
 or
 þ
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from July 1, 2009 to December 31, 2009
 Commission File No. 000-51557
 Investors Bancorp, Inc.
 (Exact name of registrant as specified in its charter)
 Delaware(State or other jurisdiction of 
incorporation or organization)
    
    22-3493930(I.R.S. Employer
Identification Number)101 JFK Parkway, Short Hills, New Jersey(Address of Principal Executive Offices)
    
    07078Zip Code
 (973) 924-5100  (Registrants telephone number)  Securities Registered Pursuant to Section 12(b) of the Act:
 Common Stock, par value $0.01 per share
    
    The NASDAQ Stock Market LLC(Title of Class)
    
    (Name of each exchange on which registered)
 Securities Registered Pursuant to Section 12(g) of the Act:
None
 o þ
 o þ
 þ o
 o o
 o
  Large accelerated filer þ
    
    Accelerated filer o
    
    Non-accelerated filer o
(Do not check if a smaller reporting company)
    
    Smaller reporting company o
 o þ
   DOCUMENTS INCORPORATED BY REFERENCE




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##### 



INVESTORS BANCORP, INC.
 2009 ANNUAL REPORT ON FORM 10-K
 TABLE OF CONTENTS
 PagePart IItem 1.
    
    Business
    
    4Item 1A.
    
    Risk Factors
    
    38Item 1B.
    
    Unresolved Staff Comments
    
    41Item 2.
    
    Properties
    
    41Item 3.
    
    Legal Proceedings
    
    41Part IIItem 4.
    
    Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
    
    42Item 5.
    
    Selected Financial Data
    
    44Item 6.
    
    Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    45Item 6A.
    
    Quantitative and Qualitative Disclosures about Market Risk
    
    62Item 7.
    
    Financial Statements and Supplementary Data
    
    62Item 8.
    
    Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
    
    62Item 8A.
    
    Controls and Procedures
    
    62Item 8B.
    
    Other Information
    
    63Part IIIItem 9.
    
    Directors, Executive and Corporate Governance
    
    64Item 10.
    
    Executive  Compensation
    
    64Item 11.
    
    Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
    
    64Item 12.
    
    Certain Relationships, Related Transactions and Director Independence
    
    64Item 13.
    
    Principal Accountant Fees and Services
    
    64Part IVItem 14.
    
    Exhibits and Financial Statement Schedules
    
    64SIGNATURES
    
    
    
    109EX-23.1EX-31.1EX-31.2EX-32
  2




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##### Table of Contents



PRIVATE SECURITIES LITIGATION REFORM ACT SAFE HARBOR STATEMENT
   
    
    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 may adversely affect our business;
    
    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;
    
    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;
    
    the risks associated with continued diversification of assets and adverse changes to
credit quality;
    
    difficulties associated with achieving expected future financial results; and
    
    the risk of continued economic slowdown that would adversely affect credit quality and
loan originations.
   3




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##### Table of Contents



PART I
 
 ITEM 1. BUSINESS
 Investors Bancorp, Inc.
       4




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##### Table of Contents



Investors Savings Bank
 General
    Market Area
   Competition
  5




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##### Table of Contents



Lending Activities
  6




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##### Table of Contents



Loan Portfolio Composition.
 December 31,
    
    
    At June 30,2009
    
    
    2009
    
    
    2008
    
    
    2007
    
    
    2006
    
    
    2005Amount
    
    
    Percent
    
    
    Amount
    
    
    Percent
    
    
    Amount
    
    
    Percent
    
    
    Amount
    
    
    Percent
    
    
    Amount
    
    
    Percent
    
    
    Amount
    
    
    Percent(Dollars in thousands)Residential mortgage loans:One- to four-family
    
    $
    4,756,042
    
    
    
    71.50
    %
    
    $
    4,690,335
    
    
    
    76.00
    %
    
    $
    3,989,334
    
    
    
    85.54
    %
    
    $
    3,159,484
    
    
    
    87.51
    %
    
    $
    2,669,726
    
    
    
    89.49
    %
    
    $
    1,874,952
    
    
    
    92.80
    %FHA
    
    
    17,514
    
    
    
    0.26
    
    
    
    18,564
    
    
    
    0.30
    
    
    
    20,229
    
    
    
    0.43
    
    
    
    22,624
    
    
    
    0.63
    
    
    
    24,928
    
    
    
    0.84
    
    
    
    34,008
    
    
    
    1.68Total residential mortgage loans
    
    
    4,773,556
    
    
    
    71.76
    
    
    
    4,708,899
    
    
    
    76.30
    
    
    
    4,009,563
    
    
    
    85.97
    
    
    
    3,182,108
    
    
    
    88.14
    
    
    
    2,694,654
    
    
    
    90.33
    
    
    
    1,908,960
    
    
    
    94.48Multi-family
    
    
    612,743
    
    
    
    9.21
    
    
    
    482,783
    
    
    
    7.82
    
    
    
    82,711
    
    
    
    1.77
    
    
    
    40,066
    
    
    
    1.11
    
    
    
    10,936
    
    
    
    0.37
    
    
    
    10,876
    
    
    
    0.54Commercial
    
    
    730,012
    
    
    
    10.97
    
    
    
    433,204
    
    
    
    7.02
    
    
    
    142,396
    
    
    
    3.06
    
    
    
    69,282
    
    
    
    1.92
    
    
    
    68,087
    
    
    
    2.28
    
    
    
    8,395
    
    
    
    0.41Construction loans
    
    
    334,480
    
    
    
    5.03
    
    
    
    346,967
    
    
    
    5.62
    
    
    
    260,177
    
    
    
    5.58
    
    
    
    153,420
    
    
    
    4.25
    
    
    
    66,209
    
    
    
    2.22
    
    
    
    7,065
    
    
    
    0.35Commercial and industrial loans
    
    
    23,159
    
    
    
    0.35
    
    
    
    15,665
    
    
    
    0.25
    
    
    
    47
    
    
    
    0.00
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Consumer and other loans:Home equity loans
    
    
    104,864
    
    
    
    1.58
    
    
    
    119,193
    
    
    
    1.93
    
    
    
    139,587
    
    
    
    2.99
    
    
    
    139,524
    
    
    
    3.86
    
    
    
    113,572
    
    
    
    3.80
    
    
    
    45,591
    
    
    
    2.26Home equity credit lines
    
    
    70,341
    
    
    
    1.06
    
    
    
    61,664
    
    
    
    1.00
    
    
    
    27,270
    
    
    
    0.59
    
    
    
    23,927
    
    
    
    0.66
    
    
    
    28,063
    
    
    
    0.94
    
    
    
    38,349
    
    
    
    1.90Other
    
    
    2,972
    
    
    
    0.04
    
    
    
    3,341
    
    
    
    0.06
    
    
    
    1,962
    
    
    
    0.04
    
    
    
    1,993
    
    
    
    0.06
    
    
    
    1,721
    
    
    
    0.06
    
    
    
    1,335
    
    
    
    0.06Total consumer and other loans
    
    
    178,177
    
    
    
    2.68
    
    
    
    184,198
    
    
    
    2.99
    
    
    
    168,819
    
    
    
    3.62
    
    
    
    165,444
    
    
    
    4.58
    
    
    
    143,356
    
    
    
    4.80
    
    
    
    85,275
    
    
    
    4.22Total loans
    
    $
    6,652,127
    
    
    
    100.00
    %
    
    $
    6,171,716
    
    
    
    100.00
    %
    
    $
    4,663,713
    
    
    
    100.00
    %
    
    $
    3,610,320
    
    
    
    100.00
    %
    
    $
    2,983,242
    
    
    
    100.00
    %
    
    $
    2,020,571
    
    
    
    100.00
    %Premiums on purchased loans, net
    
    
    22,958
    
    
    
    
    
    
    
    21,313
    
    
    
    
    
    
    
    22,622
    
    
    
    
    
    
    
    23,587
    
    
    
    
    
    
    
    20,327
    
    
    
    
    
    
    
    14,113Deferred loan fees, net
    
    
    (4,574
    )
    
    
    
    
    
    
    (3,252
    )
    
    
    
    
    
    
    (2,620
    )
    
    
    
    
    
    
    (1,958
    )
    
    
    
    
    
    
    (1,765
    )
    
    
    
    
    
    
    (916
    )Allowance for loan losses
    
    
    (55,052
    )
    
    
    
    
    
    
    (46,608
    )
    
    
    
    
    
    
    (13,565
    )
    
    
    
    
    
    
    (6,951
    )
    
    
    
    
    
    
    (6,369
    )
    
    
    
    
    
    
    (5,723
    )Net loans
    
    $
    6,615,459
    
    
    
    
    
    
    $
    6,143,169
    
    
    
    
    
    
    $
    4,670,150
    
    
    
    
    
    
    $
    3,624,998
    
    
    
    
    
    
    $
    2,995,435
    
    
    
    
    
    
    $
    2,028,045
 Loan Portfolio Maturities.
 At December 31, 2009Commercialand
    
    
    ConsumerResidential
    
    
    
    
    
    
    
    
    
    
    Construction
    
    
    Industrial
    
    
    and OtherMortgage
    
    
    Multi-Family
    
    
    Commercial
    
    
    Loans
    
    
    loans
    
    
    Loans
    
    
    Total(In thousands)Amounts Due:One year or less
    
    $
    740
    
    
    
    731
    
    
    
    4,316
    
    
    
    257,270
    
    
    
    16,740
    
    
    
    1,186
    
    
    
    280,983After one year:One to three years
    
    
    1,487
    
    
    
    12,641
    
    
    
    9,397
    
    
    
    47,655
    
    
    
    1,207
    
    
    
    3,169
    
    
    
    75,556Three to five years
    
    
    21,545
    
    
    
    158,789
    
    
    
    229,705
    
    
    
    5,481
    
    
    
    2,809
    
    
    
    6,267
    
    
    
    424,596Five to ten years
    
    
    184,434
    
    
    
    372,404
    
    
    
    430,713
    
    
    
    17,004
    
    
    
    1,025
    
    
    
    36,001
    
    
    
    1,041,581Ten to twenty years
    
    
    573,722
    
    
    
    59,038
    
    
    
    41,716
    
    
    
    5,470
    
    
    
    1,378
    
    
    
    77,478
    
    
    
    758,802Over twenty years
    
    
    3,991,628
    
    
    
    9,140
    
    
    
    14,165
    
    
    
    1,600
    
    
    
    
    
    
    
    54,076
    
    
    
    4,070,609Total due after one year
    
    
    4,772,816
    
    
    
    612,012
    
    
    
    725,696
    
    
    
    77,210
    
    
    
    6,419
    
    
    
    176,991
    
    
    
    6,371,144Total loans
    
    $
    4,773,556
    
    
    
    612,743
    
    
    
    730,012
    
    
    
    334,480
    
    
    
    23,159
    
    
    
    178,177
    
    
    
    6,652,127Premiums on purchased loans, net
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    22,958Deferred loan fees, net
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (4,574
    )Allowance for loan losses
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (55,052
    )Net loans
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    6,615,459
 7




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##### Table of Contents



Due After December 31, 2010Fixed
    
    
    Adjustable
    
    
    Total(In thousands)Residential mortgage loans
    
    
    2,681,257
    
    
    
    2,091,559
    
    
    
    4,772,816Multi-family
    
    
    252,060
    
    
    
    359,952
    
    
    
    612,012Commercial
    
    
    559,696
    
    
    
    166,000
    
    
    
    725,696Construction loans
    
    
    13,576
    
    
    
    63,634
    
    
    
    77,210Commercial and industrial
    
    
    6,160
    
    
    
    259
    
    
    
    6,419Consumer and other loans:Home equity loans
    
    
    104,458
    
    
    
    
    
    
    
    104,458Home equity credit lines
    
    
    
    
    
    
    69,574
    
    
    
    69,574Other
    
    
    2,959
    
    
    
    
    
    
    
    2,959Total consumer and other loans
    
    
    107,417
    
    
    
    69,574
    
    
    
    176,991Total loans
    
    $
    3,620,166
    
    
    $
    2,750,978
    
    
    $
    6,371,144
 Residential Mortgage Loans.
    8




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##### Table of Contents



Multi-family and Commercial Real Estate Loans.
   Construction Loans.
   9




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##### Table of Contents



Commercial and Industrial Loans.
 Consumer Loans. The Wall Street Journal
 Loan Originations, Purchases, Sales and Servicing of Loans.
    10




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##### Table of Contents



At December 31,
    
    
    At June 30,2009
    
    
    2008
    
    
    2009
    
    
    2008
    
    
    2007(Unaudited)(In thousands)Loan originations and purchases:Loan originations:Residential mortgage loans:One- to four-family
    
    $
    359,118
    
    
    $
    217,618
    
    
    $
    407,381
    
    
    $
    284,386
    
    
    $
    159,100FHA
    
    
    
    
    
    
    244
    
    
    
    244
    
    
    
    483
    
    
    
    Total residential mortgage loans
    
    
    359,118
    
    
    
    217,862
    
    
    
    407,625
    
    
    
    284,869
    
    
    
    159,100Multi-family
    
    
    148,386
    
    
    
    46,519
    
    
    
    145,521
    
    
    
    139,995
    
    
    
    36,862Commercial
    
    
    301,603
    
    
    
    87,059
    
    
    
    221,964
    
    
    
    
    
    
    
    Construction loans
    
    
    56,275
    
    
    
    89,564
    
    
    
    127,631
    
    
    
    174,110
    
    
    
    116,250Commercial and industrial
    
    
    14,637
    
    
    
    
    
    
    
    9,961
    
    
    
    
    
    
    
    Consumer and other loans:Home equity loans
    
    
    6,251
    
    
    
    9,872
    
    
    
    14,562
    
    
    
    34,039
    
    
    
    49,214Home equity credit lines
    
    
    26,018
    
    
    
    12,144
    
    
    
    32,190
    
    
    
    21,759
    
    
    
    18,442Other
    
    
    2,012
    
    
    
    1,861
    
    
    
    3,698
    
    
    
    2,749
    
    
    
    2,852Total consumer and other loans
    
    
    34,281
    
    
    
    23,877
    
    
    
    50,450
    
    
    
    58,547
    
    
    
    70,508Total loan originations
    
    
    914,300
    
    
    
    464,879
    
    
    
    963,152
    
    
    
    657,521
    
    
    
    382,720Loan purchases:Residential mortgage loans:One- to four-family
    
    
    452,295
    
    
    
    720,922
    
    
    
    1,063,616
    
    
    
    995,753
    
    
    
    665,166FHA
    
    
    
    
    
    
    274
    
    
    
    274
    
    
    
    567
    
    
    
    Multi-family
    
    
    
    
    
    
    100,914
    
    
    
    200,914
    
    
    
    
    
    
    
    Total loan purchases
    
    
    452,295
    
    
    
    822,110
    
    
    
    1,264,804
    
    
    
    996,320
    
    
    
    665,166Loan principal repayments
    
    
    (882,200
    )
    
    
    (324,721
    )
    
    
    (1,190,114
    )
    
    
    (599,547
    )
    
    
    (415,886
    )Other items, net(1)
    
    
    (12,105
    )
    
    
    (14,232
    )
    
    
    (35,598
    )
    
    
    (9,142
    )
    
    
    (2,436
    )Net loans acquired in acquisition
    
    
    
    
    
    
    
    
    
    
    470,775
    
    
    
    
    
    
    
    Net increase in loan portfolio
    
    $
    472,290
    
    
    $
    948,036
    
    
    $
    1,473,019
    
    
    $
    1,045,152
    
    
    $
    629,564
 
 (1)
    
    Other items include charge-offs, loan loss provisions, loans transferred to other real estate owned,
and amortization and accretion of deferred fees and costs and discounts and premiums.  Loan Approval Procedures and Authority.
  11




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##### Table of Contents



Loans to One Borrower.
 Asset Quality
   Collection Procedures.
  12




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##### Table of Contents



Delinquent Loans.
 Loans Delinquent For60-89 Days
    
    
    90 Days and Over
    
    
    TotalNumber
    
    
    Amount
    
    
    Number
    
    
    Amount
    
    
    Number
    
    
    Amount(Dollars in thousands)At December 31, 2009Residential mortgage loans:One- to four-family
    
    
    47
    
    
    $
    13,273
    
    
    
    143
    
    
    $
    47,582
    
    
    
    190
    
    
    $
    60,855FHA
    
    
    4
    
    
    
    384
    
    
    
    19
    
    
    
    2,507
    
    
    
    23
    
    
    
    2,891Total residential mortgage loans
    
    
    51
    
    
    
    13,657
    
    
    
    162
    
    
    
    50,089
    
    
    
    213
    
    
    
    63,746Multi-family
    
    
    
    
    
    
    
    
    
    
    4
    
    
    
    553
    
    
    
    4
    
    
    
    553Commercial
    
    
    
    
    
    
    
    
    
    
    10
    
    
    
    3,417
    
    
    
    10
    
    
    
    3,417Construction loans
    
    
    4
    
    
    
    30,556
    
    
    
    20
    
    
    
    41,968
    
    
    
    24
    
    
    
    72,524Commercial and industrial
    
    
    3
    
    
    
    734
    
    
    
    
    
    
    
    
    
    
    
    3
    
    
    
    734Consumer and other loans:Home equity loans
    
    
    
    
    
    
    
    
    
    
    4
    
    
    
    81
    
    
    
    4
    
    
    
    81Home equity credit lines
    
    
    5
    
    
    
    191
    
    
    
    11
    
    
    
    1,074
    
    
    
    16
    
    
    
    1,265Other
    
    
    7
    
    
    
    7
    
    
    
    8
    
    
    
    11
    
    
    
    15
    
    
    
    18Total consumer and other loans
    
    
    12
    
    
    
    198
    
    
    
    23
    
    
    
    1,166
    
    
    
    35
    
    
    
    1,364Total
    
    
    70
    
    
    $
    45,145
    
    
    
    219
    
    
    $
    97,193
    
    
    
    289
    
    
    $
    142,338At June 30, 2009Residential mortgage loans:One- to four-family
    
    
    30
    
    
    $
    8,165
    
    
    
    82
    
    
    $
    27,837
    
    
    
    112
    
    
    $
    36,002FHA
    
    
    6
    
    
    
    721
    
    
    
    15
    
    
    
    1,904
    
    
    
    21
    
    
    
    2,625Total residential mortgage loans
    
    
    36
    
    
    
    8,886
    
    
    
    97
    
    
    
    29,741
    
    
    
    133
    
    
    
    38,627Multi-family
    
    
    1
    
    
    
    181
    
    
    
    6
    
    
    
    20,074
    
    
    
    7
    
    
    
    20,255Commercial
    
    
    3
    
    
    
    784
    
    
    
    6
    
    
    
    2,820
    
    
    
    9
    
    
    
    3,604Construction loans
    
    
    3
    
    
    
    11,263
    
    
    
    17
    
    
    
    58,550
    
    
    
    20
    
    
    
    69,813Commercial and industrial
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Consumer and other loans:Home equity loans
    
    
    1
    
    
    
    2
    
    
    
    2
    
    
    
    60
    
    
    
    3
    
    
    
    62Home equity credit lines
    
    
    4
    
    
    
    659
    
    
    
    3
    
    
    
    150
    
    
    
    7
    
    
    
    809Other
    
    
    4
    
    
    
    4
    
    
    
    10
    
    
    
    15
    
    
    
    14
    
    
    
    19Total consumer and other loans
    
    
    9
    
    
    
    665
    
    
    
    15
    
    
    
    225
    
    
    
    24
    
    
    
    890Total
    
    
    52
    
    
    $
    21,779
    
    
    
    141
    
    
    $
    111,410
    
    
    
    193
    
    
    $
    133,189At June 30, 2008Residential mortgage loans:One- to four-family
    
    
    8
    
    
    $
    1,608
    
    
    
    18
    
    
    $
    5,060
    
    
    
    26
    
    
    $
    6,668FHA
    
    
    1
    
    
    
    66
    
    
    
    15
    
    
    
    1,631
    
    
    
    16
    
    
    
    1,697Total residential mortgage loans
    
    
    9
    
    
    
    1,674
    
    
    
    33
    
    
    
    6,691
    
    
    
    42
    
    
    
    8,365Multi-family and commercial
    
    
    
    
    
    
    
    
    
    
    4
    
    
    
    1,600
    
    
    
    4
    
    
    
    1,600Construction loans
    
    
    1
    
    
    
    10,960
    
    
    
    
    
    
    
    
    
    
    
    1
    
    
    
    10,960Consumer and other loans:Home equity loans
    
    
    
    
    
    
    
    
    
    
    3
    
    
    
    88
    
    
    
    3
    
    
    
    88Home equity credit lines
    
    
    
    
    
    
    
    
    
    
    1
    
    
    
    30
    
    
    
    1
    
    
    
    30Other
    
    
    2
    
    
    
    2
    
    
    
    2
    
    
    
    2
    
    
    
    4
    
    
    
    4Total consumer and other loans
    
    
    2
    
    
    
    2
    
    
    
    6
    
    
    
    120
    
    
    
    8
    
    
    
    122Total
    
    
    12
    
    
    $
    12,636
    
    
    
    43
    
    
    $
    8,411
    
    
    
    55
    
    
    $
    21,047At June 30, 2007Residential mortgage loans:One- to four-family
    
    
    7
    
    
    $
    628
    
    
    
    12
    
    
    $
    2,220
    
    
    
    19
    
    
    $
    2,848FHA
    
    
    2
    
    
    
    263
    
    
    
    14
    
    
    
    1,300
    
    
    
    16
    
    
    
    1,563Total residential mortgage loans
    
    
    9
    
    
    
    891
    
    
    
    26
    
    
    
    3,520
    
    
    
    35
    
    
    
    4,411Multi-family and commercial
    
    
    1
    
    
    
    579
    
    
    
    3
    
    
    
    452
    
    
    
    4
    
    
    
    1,031Construction loans
    
    
    
    
    
    
    
    
    
    
    1
    
    
    
    1,146
    
    
    
    1
    
    
    
    1,146Consumer and other loans:Home equity loans
    
    
    1
    
    
    
    7
    
    
    
    1
    
    
    
    28
    
    
    
    2
    
    
    
    35Home equity credit lines
    
    
    3
    
    
    
    88
    
    
    
    
    
    
    
    
    
    
    
    3
    
    
    
    88Other
    
    
    1
    
    
    
    1
    
    
    
    4
    
    
    
    3
    
    
    
    5
    
    
    
    4Total consumer and other loans
    
    
    5
    
    
    
    96
    
    
    
    5
    
    
    
    31
    
    
    
    10
    
    
    
    127Total
    
    
    15
    
    
    $
    1,566
    
    
    
    35
    
    
    $
    5,149
    
    
    
    50
    
    
    $
    6,715
 13




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##### Table of Contents



Non-Performing Assets.
  December 31,
    
    
    June 30,2009(1)
    
    
    2009(2)
    
    
    2008(3)
    
    
    2007
    
    
    2006
    
    
    2005(Dollars in thousands)Non-accrual loans:Residential mortgage loans:One- to four-family
    
    $
    47,582
    
    
    $
    27,837
    
    
    $
    5,060
    
    
    $
    2,220
    
    
    $
    1,346
    
    
    $
    3,237FHA
    
    
    2,507
    
    
    
    1,904
    
    
    
    1,631
    
    
    
    1,300
    
    
    
    1,440
    
    
    
    3,825Total residential mortgage loans
    
    
    50,089
    
    
    
    29,741
    
    
    
    6,691
    
    
    
    3,520
    
    
    
    2,786
    
    
    
    7,062Multi-family and commercial
    
    
    3,970
    
    
    
    22,894
    
    
    
    1,600
    
    
    
    452
    
    
    
    477
    
    
    
    608Construction loans
    
    
    64,968
    
    
    
    68,826
    
    
    
    10,960
    
    
    
    1,146
    
    
    
    
    
    
    
    Commercial and industrial
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Consumer and other loans:Home equity loans
    
    
    81
    
    
    
    60
    
    
    
    88
    
    
    
    28
    
    
    
    6
    
    
    
    193Home equity credit lines
    
    
    1,074
    
    
    
    150
    
    
    
    30
    
    
    
    
    
    
    
    30
    
    
    
    Other
    
    
    11
    
    
    
    15
    
    
    
    2
    
    
    
    3
    
    
    
    
    
    
    
    2Total consumer and other loans
    
    
    1,166
    
    
    
    225
    
    
    
    120
    
    
    
    31
    
    
    
    36
    
    
    
    195Total
    
    
    120,193
    
    
    
    121,686
    
    
    
    19,371
    
    
    
    5,149
    
    
    
    3,299
    
    
    
    7,865Total non-performing loans
    
    
    120,193
    
    
    
    121,686
    
    
    
    19,371
    
    
    
    5,149
    
    
    
    3,299
    
    
    
    7,865Real estate owned
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Total non-performing assets
    
    $
    120,193
    
    
    $
    121,686
    
    
    $
    19,371
    
    
    $
    5,149
    
    
    $
    3,299
    
    
    $
    7,865Total non-performing loans to total loans
    
    
    1.81
    %
    
    
    1.97
    %
    
    
    0.42
    %
    
    
    0.14
    %
    
    
    0.11
    %
    
    
    0.39
    %Total non-performing loans to total assets
    
    
    1.44
    %
    
    
    1.50
    %
    
    
    0.30
    %
    
    
    0.09
    %
    
    
    0.06
    %
    
    
    0.15
    %Total non-performing assets to total assets
    
    
    1.44
    %
    
    
    1.50
    %
    
    
    0.30
    %
    
    
    0.09
    %
    
    
    0.06
    %
    
    
    0.15
    %
 
 (1)
    
    An $11.5 million construction loan that is 60-89 days delinquent at December 31, 2009 is classified as
non-performing.(2)
    
    Two construction loans totaling $10.3 million are 60-89 days delinquent at June 30, 2009 are classified as
non-performing.(3)
    
    An $11.0 million construction loan that is 60-89 days delinquent at June 30, 2008 is classified as non-performing.  Real Estate Owned.
 14




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##### Table of Contents



Classified Assets.
   Impaired Loans.
 Allowance for Loan Losses
   15




---



##### Table of Contents



Allowance for Loan Losses.
 Six months Ended December 31,
    
    
    At or for the Years Ended June 30,2009
    
    
    2008
    
    
    2009
    
    
    2008
    
    
    2007
    
    
    2006
    
    
    2005(Unaudited)(Dollars in thousands)Allowance balance (beginning of period)
    
    $
    46,608
    
    
    $
    13,565
    
    
    $
    13,565
    
    
    $
    6,951
    
    
    $
    6,369
    
    
    $
    5,723
    
    
    $
    5,218Provision for loan losses
    
    
    23,425
    
    
    
    13,000
    
    
    
    29,025
    
    
    
    6,646
    
    
    
    729
    
    
    
    600
    
    
    
    604Charge-offs:Residential mortgage loans One- to four-family
    
    
    1,587
    
    
    
    13
    
    
    
    
    
    
    
    18
    
    
    
    
    
    
    
    
    
    
    
    3FHA
    
    
    4
    
    
    
    
    
    
    
    14
    
    
    
    
    
    
    
    141
    
    
    
    143
    
    
    
    108Total residential mortgage loans
    
    
    1,591
    
    
    
    13
    
    
    
    14
    
    
    
    18
    
    
    
    141
    
    
    
    143
    
    
    
    111Multi-family and commercial loans
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Construction loans
    
    
    13,411
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Commercial & industrial loans
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Consumer and other loans
    
    
    23
    
    
    
    3
    
    
    
    11
    
    
    
    15
    
    
    
    10
    
    
    
    10
    
    
    
    14Total charge-offs
    
    
    15,025
    
    
    
    16
    
    
    
    25
    
    
    
    33
    
    
    
    151
    
    
    
    153
    
    
    
    125Recoveries:Residential mortgage loansOne- to four-family
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    25FHA
    
    
    44
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    196
    
    
    
    Total residential mortgage loans
    
    
    44
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    196
    
    
    
    25Multi-family and commercial loans
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Construction loans
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Commercial & industrial loans
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Consumer and other loans
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1
    
    
    
    4
    
    
    
    3
    
    
    
    1Total recoveries
    
    
    44
    
    
    
    
    
    
    
    
    
    
    
    1
    
    
    
    4
    
    
    
    199
    
    
    
    26Net (charge-offs) recoveries
    
    
    (14,981
    )
    
    
    (16
    )
    
    
    (25
    )
    
    
    (32
    )
    
    
    (147
    )
    
    
    46
    
    
    
    (99
    )Allowance acquired in acquisition
    
    
    
    
    
    
    
    
    
    
    4,043
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Allowance balance (end of period)
    
    $
    55,052
    
    
    $
    26,549
    
    
    $
    46,608
    
    
    $
    13,565
    
    
    $
    6,951
    
    
    $
    6,369
    
    
    $
    5,723Total loans outstanding
    
    $
    6,652,127
    
    
    $
    5,623,563
    
    
    $
    6,171,716
    
    
    $
    4,663,713
    
    
    $
    3,610,320
    
    
    $
    2,983,242
    
    
    $
    2,020,571Average loans outstanding
    
    
    6,370,350
    
    
    
    5,241,754
    
    
    
    5,482,009
    
    
    
    4,043,398
    
    
    
    3,305,807
    
    
    
    2,462,270
    
    
    
    1,533,741Allowance for loan losses as a percent of
total loans outstanding
    
    
    0.83
    %
    
    
    0.47
    %
    
    
    0.76
    %
    
    
    0.29
    %
    
    
    0.19
    %
    
    
    0.21
    %
    
    
    0.28
    %Net loans charged off as a percent of average
loans outstanding
    
    
    0.24
    %
    
    
    
    %
    
    
    
    %
    
    
    
    %
    
    
    
    %
    
    
    
    %
    
    
    0.01
    %Allowance for loan losses to non-performing
loans
    
    
    45.80
    %
    
    
    55.53
    %
    
    
    38.30
    %
    
    
    70.03
    %
    
    
    135.00
    %
    
    
    193.06
    %
    
    
    72.77
    %
 16




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##### Table of Contents



Allocation of Allowance for Loan Losses.
 December 31,
    
    
    June 30,2009
    
    
    2009
    
    
    2008Percent of
    
    
    
    
    
    
    Percent of
    
    
    
    
    
    
    Percent ofLoans in
    
    
    
    
    
    
    Loans in
    
    
    
    
    
    
    Loans inAllowance
    
    
    Each
    
    
    Allowance
    
    
    Each
    
    
    Allowance
    
    
    Eachfor Loan
    
    
    Category to
    
    
    for Loan
    
    
    Category to
    
    
    for Loan
    
    
    Category toLosses
    
    
    Total Loans
    
    
    Losses
    
    
    Total Loans
    
    
    Losses
    
    
    Total Loans(Dollars in thousands)End of period allocated to:Residential mortgage loans
    
    $
    13,741
    
    
    $
    71.76
    %
    
    $
    10,841
    
    
    
    76.30
    %
    
    $
    4,585
    
    
    
    85.97
    %Multi-family
    
    
    3,227
    
    
    
    9.21
    %
    
    
    1,518
    
    
    
    7.82
    %
    
    
    223
    
    
    
    1.77
    %Commercial
    
    
    10,208
    
    
    
    10.97
    %
    
    
    6,223
    
    
    
    7.02
    %
    
    
    1,454
    
    
    
    3.06
    %Construction loans
    
    
    25,194
    
    
    
    5.03
    %
    
    
    23,437
    
    
    
    5.62
    %
    
    
    4,836
    
    
    
    5.58
    %Commercial and industrial
    
    
    558
    
    
    
    0.35
    %
    
    
    351
    
    
    
    0.25
    %
    
    
    
    
    
    
    
    %Consumer and other loans
    
    
    510
    
    
    
    2.68
    %
    
    
    459
    
    
    
    2.99
    %
    
    
    254
    
    
    
    3.62
    %Unallocated
    
    
    1,614
    
    
    
    
    
    
    
    3,779
    
    
    
    
    
    
    
    2,213Total allowance
    
    $
    55,052
    
    
    
    100.00
    %
    
    $
    46,608
    
    
    
    100.00
    %
    
    $
    13,565
    
    
    
    100.00
    %
 June 30,2007
    
    
    2006
    
    
    2005Percent of
    
    
    
    
    
    
    Percent of
    
    
    
    
    
    
    Percent ofLoans in
    
    
    
    
    
    
    Loans in
    
    
    
    
    
    
    Loans inAllowance
    
    
    Each
    
    
    Allowance
    
    
    Each
    
    
    Allowance
    
    
    Eachfor Loan
    
    
    Category to
    
    
    for Loan
    
    
    Category to
    
    
    for Loan
    
    
    Category toLosses
    
    
    Total Loans
    
    
    Losses
    
    
    Total Loans
    
    
    Losses
    
    
    Total Loans(Dollars in thousands)End of period allocated to:Residential mortgage loans
    
    $
    3,444
    
    
    
    88.14
    %
    
    $
    2,910
    
    
    
    90.33
    %
    
    $
    4,249
    
    
    
    94.48
    %Multi-family and commercial
    
    
    956
    
    
    
    3.03
    %
    
    
    1,591
    
    
    
    2.65
    %
    
    
    712
    
    
    
    0.95
    %Construction loans
    
    
    1,896
    
    
    
    4.25
    %
    
    
    820
    
    
    
    2.22
    %
    
    
    28
    
    
    
    0.35
    %Consumer and other loans
    
    
    247
    
    
    
    4.58
    %
    
    
    354
    
    
    
    4.80
    %
    
    
    248
    
    
    
    4.22
    %Unallocated
    
    
    408
    
    
    
    
    
    
    
    694
    
    
    
    
    
    
    
    486Total allowance
    
    $
    6,951
    
    
    
    100.00
    %
    
    $
    6,369
    
    
    
    100.00
    %
    
    $
    5,723
    
    
    
    100.00
    %
 17




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##### Table of Contents



Security Investments
     Mortgage-Backed Securities.
   18




---



##### Table of Contents



Corporate and Other Debt Securities.
    19




---



##### Table of Contents



Government Sponsored Enterprises.
 Marketable Equity Securities.
 20




---



##### Table of Contents



Securities Portfolios.
 At December 31,
    
    
    At June 30,2009
    
    
    2009
    
    
    2008
    
    
    2007Amortized
    
    
    Estimated
    
    
    Amortized
    
    
    Estimated
    
    
    Amortized
    
    
    Estimated
    
    
    Amortized
    
    
    EstimatedCost
    
    
    Fair Value
    
    
    Cost
    
    
    Fair Value
    
    
    Cost
    
    
    Fair Value
    
    
    Cost
    
    
    Fair Value(In thousands)Available-for-sale:Equity securities
    
    $
    1,832
    
    
    $
    2,053
    
    
    $
    1,583
    
    
    $
    1,598
    
    
    $
    6,655
    
    
    $
    6,514
    
    
    $
    6,205
    
    
    $
    5,969GSE debt securities
    
    
    25,013
    
    
    
    25,039
    
    
    
    30,051
    
    
    
    30,079
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Mortgage-backed securities:Federal Home Loan Mortgage Corporation
    
    
    206,877
    
    
    
    209,522
    
    
    
    151,450
    
    
    
    152,718
    
    
    
    51,256
    
    
    
    51,197
    
    
    
    68,635
    
    
    
    67,223Federal National Mortgage Association
    
    
    158,678
    
    
    
    160,427
    
    
    
    94,967
    
    
    
    96,617
    
    
    
    49,393
    
    
    
    49,364
    
    
    
    70,059
    
    
    
    68,856Government National Mortgage Association
    
    
    10,504
    
    
    
    10,450
    
    
    
    275
    
    
    
    300
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Non-agency securities
    
    
    67,290
    
    
    
    63,752
    
    
    
    80,523
    
    
    
    73,704
    
    
    
    101,555
    
    
    
    95,957
    
    
    
    119,598
    
    
    
    115,891Total mortgage-backed securities available for sale
    
    
    443,349
    
    
    
    444,151
    
    
    
    327,215
    
    
    
    323,339
    
    
    
    202,204
    
    
    
    196,518
    
    
    
    258,292
    
    
    
    251,970Total securities available-for-sale
    
    $
    470,194
    
    
    $
    471,243
    
    
    $
    358,849
    
    
    $
    355,016
    
    
    $
    208,859
    
    
    $
    203,032
    
    
    $
    264,497
    
    
    $
    257,939Held-to-maturity:Debt securities:Government Sponsored Enterprises
    
    $
    15,226
    
    
    $
    15,956
    
    
    $
    18,238
    
    
    $
    19,161
    
    
    $
    46,703
    
    
    $
    47,052
    
    
    $
    131,900
    
    
    $
    127,370Municipal bonds
    
    
    10,259
    
    
    
    10,451
    
    
    
    10,420
    
    
    
    10,624
    
    
    
    10,574
    
    
    
    10,773
    
    
    
    14,048
    
    
    
    14,236Corporate and other debt securities
    
    
    21,411
    
    
    
    37,809
    
    
    
    20,727
    
    
    
    20,129
    
    
    
    178,669
    
    
    
    135,527
    
    
    
    166,074
    
    
    
    165,89746,896
    
    
    
    64,216
    
    
    
    49,385
    
    
    
    49,914
    
    
    
    235,946
    
    
    
    193,352
    
    
    
    312,022
    
    
    
    307,503Mortgage-backed securities:Federal Home Loan Mortgage Corporation
    
    
    358,998
    
    
    
    369,404
    
    
    
    429,969
    
    
    
    440,088
    
    
    
    551,708
    
    
    
    544,834
    
    
    
    684,839
    
    
    
    660,478Government National Mortgage Association
    
    
    3,880
    
    
    
    4,157
    
    
    
    4,269
    
    
    
    4,617
    
    
    
    5,052
    
    
    
    5,322
    
    
    
    6,061
    
    
    
    6,235Federal National Mortgage Association
    
    
    236,109
    
    
    
    245,353
    
    
    
    278,272
    
    
    
    286,820
    
    
    
    354,493
    
    
    
    351,003
    
    
    
    444,689
    
    
    
    430,723Federal housing authorities
    
    
    2,549
    
    
    
    2,780
    
    
    
    2,654
    
    
    
    2,908
    
    
    
    2,849
    
    
    
    3,077
    
    
    
    3,027
    
    
    
    3,251Non-agency securities
    
    
    69,009
    
    
    
    67,495
    
    
    
    81,494
    
    
    
    76,955
    
    
    
    105,006
    
    
    
    100,465
    
    
    
    128,284
    
    
    
    123,686Total mortgage-backed securities held-to-maturity
    
    
    670,545
    
    
    
    689,189
    
    
    
    796,658
    
    
    
    811,388
    
    
    
    1,019,108
    
    
    
    1,004,701
    
    
    
    1,266,900
    
    
    
    1,224,373Total securities held-to-maturity
    
    $
    717,441
    
    
    $
    753,405
    
    
    $
    846,043
    
    
    $
    861,302
    
    
    $
    1,255,054
    
    
    $
    1,198,053
    
    
    $
    1,578,922
    
    
    $
    1,531,876Total securities
    
    $
    1,187,635
    
    
    $
    1,224,648
    
    
    $
    1,204,892
    
    
    $
    1,216,318
    
    
    $
    1,463,913
    
    
    $
    1,401,085
    
    
    $
    1,843,419
    
    
    $
    1,789,815
  21




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##### Table of Contents



Portfolio Maturities and Yields.
 More than One Year
    
    
    More than Five YearsOne Year or Less
    
    
    through Five Years
    
    
    through Ten Years
    
    
    More than Ten Years
    
    
    Total SecuritiesWeighted
    
    
    
    
    
    
    Weighted
    
    
    
    
    
    
    Weighted
    
    
    
    
    
    
    Weighted
    
    
    
    
    
    
    
    
    
    
    WeightedAmortized
    
    
    Average
    
    
    Amortized
    
    
    Average
    
    
    Amortized
    
    
    Average
    
    
    Amortized
    
    
    Average
    
    
    Amortized
    
    
    
    
    
    
    AverageCost
    
    
    Yield
    
    
    Cost
    
    
    Yield
    
    
    Cost
    
    
    Yield
    
    
    Cost
    
    
    Yield
    
    
    Cost
    
    
    Fair Value
    
    
    Yield(Dollars in thousands)Available-for-Sale:Equity securities
    
    $
    
    
    
    
    
    %
    
    $
    
    
    
    
    
    %
    
    $
    
    
    
    
    
    %
    
    $
    1,832
    
    
    
    
    %
    
    $
    1,832
    
    
    $
    2,053
    
    
    
    
    %GSE debt securities
    
    
    25,013
    
    
    
    0.89
    %
    
    
    
    
    
    
    
    %
    
    
    
    
    
    
    
    %
    
    
    
    
    
    
    
    %
    
    
    25,013
    
    
    
    25,039
    
    
    
    
    %Mortgage-backed securities:Federal Home Loan Mortgage
Corporation
    
    
    
    
    
    
    
    %
    
    
    4,510
    
    
    
    4.01
    %
    
    
    38,461
    
    
    
    4.01
    %
    
    
    163,906
    
    
    
    4.79
    %
    
    
    206,877
    
    
    
    209,522
    
    
    
    4.63
    %Government National Mortgage
Association
    
    
    
    
    
    
    
    %
    
    
    15,031
    
    
    
    4.04
    %
    
    
    65,906
    
    
    
    4.00
    %
    
    
    77,741
    
    
    
    4.45
    %
    
    
    158,678
    
    
    
    160,427
    
    
    
    4.23
    %Federal National Mortgage
Association
    
    
    
    
    
    
    
    %
    
    
    
    
    
    
    
    %
    
    
    
    
    
    
    
    %
    
    
    10,504
    
    
    
    4.01
    %
    
    
    10,504
    
    
    
    10,450
    
    
    
    4.01
    %Non-agency securities
    
    
    
    
    
    
    
    %
    
    
    89
    
    
    
    0.41
    %
    
    
    50,320
    
    
    
    4.59
    %
    
    
    16,881
    
    
    
    4.07
    %
    
    
    67,290
    
    
    
    63,752
    
    
    
    4.45
    %Total mortgage-backed
securities
    
    $
    
    
    
    
    
    %
    
    
    19,630
    
    
    
    4.02
    %
    
    
    154,687
    
    
    
    4.19
    %
    
    
    269,032
    
    
    
    4.46
    %
    
    
    443,349
    
    
    
    444,151
    
    
    
    4.44
    %Total securities available-for-
sale
    
    $
    25,013
    
    
    
    0.89
    %
    
    $
    19,630
    
    
    
    4.02
    %
    
    $
    154,687
    
    
    
    4.19
    %
    
    $
    270,864
    
    
    
    4.43
    %
    
    $
    470,194
    
    
    $
    471,243
    
    
    
    4.19
    %Held-to-Maturity:Debt securities:Government sponsored enterprises
    
    $
    
    
    
    
    
    %
    
    $
    15,000
    
    
    
    4.50
    %
    
    $
    226
    
    
    
    1.25
    %
    
    $
    
    
    
    
    
    %
    
    $
    15,226
    
    
    $
    15,956
    
    
    
    4.45
    %Municipal bonds
    
    
    
    
    
    
    
    %
    
    
    5,109
    
    
    
    6.80
    %
    
    
    20
    
    
    
    7.17
    %
    
    
    5,130
    
    
    
    9.08
    %
    
    
    10,259
    
    
    
    10,451
    
    
    
    7.94
    %Corporate and other debt
securities
    
    
    
    
    
    
    
    %
    
    
    
    
    
    
    
    %
    
    
    
    
    
    
    
    %
    
    
    21,411
    
    
    
    1.81
    %
    
    
    21,411
    
    
    
    37,809
    
    
    
    1.81
    %
    
    
    
    
    %
    
    
    20,109
    
    
    
    5.08
    %
    
    
    246
    
    
    
    1.73
    %
    
    
    26,541
    
    
    
    3.22
    %
    
    
    46,896
    
    
    
    64,216
    
    
    
    4.01
    %Mortgage-backed securities:Federal Home Loan Mortgage
Corporation
    
    
    4,803
    
    
    
    3.65
    %
    
    
    12,511
    
    
    
    4.05
    %
    
    
    188,328
    
    
    
    4.22
    %
    
    
    153,356
    
    
    
    4.07
    %
    
    
    358,998
    
    
    
    369,404
    
    
    
    4.00
    %Government National Mortgage
Association
    
    
    
    
    
    
    
    %
    
    
    1
    
    
    
    12.00
    %
    
    
    2
    
    
    
    10.00
    %
    
    
    3,877
    
    
    
    7.24
    %
    
    
    3,880
    
    
    
    4,157
    
    
    
    7.24
    %Federal National Mortgage
Association
    
    
    1,259
    
    
    
    4.25
    %
    
    
    112
    
    
    
    7.50
    %
    
    
    116,268
    
    
    
    4.65
    %
    
    
    118,470
    
    
    
    4.67
    %
    
    
    236,109
    
    
    
    245,353
    
    
    
    4.64
    %Federal and state housing
authorities
    
    
    
    
    
    
    
    %
    
    
    1,572
    
    
    
    8.88
    %
    
    
    977
    
    
    
    8.90
    %
    
    
    
    
    
    
    
    %
    
    
    2,549
    
    
    
    2,780
    
    
    
    8.88
    %Non-agency securities
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    64,849
    
    
    
    4.88
    %
    
    
    4,160
    
    
    
    2.91
    %
    
    
    69,009
    
    
    
    67,495
    
    
    
    4.76
    %Total mortgage-backed securities
    
    
    6,062
    
    
    
    3.78
    %
    
    
    14,196
    
    
    
    4.61
    %
    
    
    370,424
    
    
    
    4.48
    %
    
    
    279,863
    
    
    
    4.35
    %
    
    
    670,545
    
    
    
    689,189
    
    
    
    4.34
    %Total securities held-to-maturity
    
    $
    6,062
    
    
    
    3.78
    %
    
    $
    34,305
    
    
    
    4.89
    %
    
    $
    370,670
    
    
    
    4.48
    %
    
    $
    306,404
    
    
    
    4.25
    %
    
    $
    717,441
    
    
    $
    753,405
    
    
    
    4.31
    %
 22




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##### Table of Contents



Sources of Funds
 General.
 Deposits.
    At December 31,
    
    
    At June 30,2009
    
    
    2009Percent of
    
    
    Weighted
    
    
    
    
    
    
    Percent of
    
    
    WeightedTotal
    
    
    Average
    
    
    
    
    
    
    Total
    
    
    AverageBalance
    
    
    Deposits
    
    
    Rate
    
    
    Balance
    
    
    Deposits
    
    
    Rate(Dollars in thousands)Savings
    
    $
    877,421
    
    
    
    15.02
    %
    
    
    1.64
    %
    
    $
    779,678
    
    
    
    14.16
    %
    
    
    1.99
    %Checking accounts
    
    
    927,675
    
    
    
    15.88
    
    
    
    0.81
    
    
    
    898,816
    
    
    
    16.33
    
    
    
    0.84Money market deposits
    
    
    742,618
    
    
    
    12.72
    
    
    
    1.26
    
    
    
    521,425
    
    
    
    9.47
    
    
    
    1.76Total transaction accounts
    
    
    2,547,714
    
    
    
    43.62
    
    
    
    1.21
    
    
    
    2,199,919
    
    
    
    39.96
    
    
    
    1.46Certificates of deposit
    
    
    3,292,929
    
    
    
    56.38
    
    
    
    2.18
    
    
    
    3,305,828
    
    
    
    60.04
    
    
    
    2.80Total deposits
    
    $
    5,840,643
    
    
    
    100.00
    %
    
    
    1.77
    %
    
    $
    5,505,747
    
    
    
    100.00
    %
    
    
    2.27
    %
 23




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##### Table of Contents



At June 30,2008
    
    
    2007Percent of
    
    
    Weighted
    
    
    
    
    
    
    Percent of
    
    
    WeightedTotal
    
    
    Average
    
    
    
    
    
    
    Total
    
    
    AverageBalance
    
    
    Deposits
    
    
    Rate
    
    
    Balance
    
    
    Deposits
    
    
    Rate(Dollars in thousands)Savings
    
    $
    417,196
    
    
    
    10.51
    %
    
    
    1.96
    %
    
    $
    358,866
    
    
    
    9.52
    %
    
    
    2.13
    %Checking
    
    
    401,100
    
    
    
    10.10
    
    
    
    1.28
    
    
    
    406,231
    
    
    
    10.78
    
    
    
    2.30Money market deposits
    
    
    229,018
    
    
    
    5.77
    
    
    
    2.06
    
    
    
    182,274
    
    
    
    4.84
    
    
    
    2.37Total transaction accounts
    
    
    1,047,314
    
    
    
    26.38
    
    
    
    1.72
    
    
    
    947,371
    
    
    
    25.14
    
    
    
    2.25Certificates of deposit
    
    
    2,922,961
    
    
    
    73.62
    
    
    
    3.71
    
    
    
    2,820,817
    
    
    
    74.86
    
    
    
    5.03Total deposits
    
    $
    3,970,275
    
    
    
    100.00
    %
    
    
    3.18
    %
    
    $
    3,768,188
    
    
    
    100.00
    %
    
    
    4.33
    %
  At December 31,
    
    
    At June 30,2009
    
    
    2009
    
    
    2008
    
    
    2007(Dollars in thousands)Certificates of DepositsLess than 2%
    
    $
    1,872,168
    
    
    $
    598,759
    
    
    $
    45,284
    
    
    $
    18,8132.01% - 3.00%
    
    
    850,129
    
    
    
    1,501,821
    
    
    
    566,007
    
    
    
    19,9103.01% - 4.00%
    
    
    267,519
    
    
    
    866,050
    
    
    
    1,188,461
    
    
    
    441,6334.01% - 5.00%
    
    
    268,460
    
    
    
    311,509
    
    
    
    769,010
    
    
    
    1,070,531Over 5.00%
    
    
    34,653
    
    
    
    27,689
    
    
    
    354,199
    
    
    
    1,269,930Total
    
    $
    3,292,929
    
    
    $
    3,305,828
    
    
    $
    2,922,961
    
    
    $
    2,820,817
  Within
    
    
    Over
    
    
    Over
    
    
    Over
    
    
    Over
    
    
    OverThree
    
    
    Three to
    
    
    Six Months to
    
    
    One Year to
    
    
    Two Years to
    
    
    ThreeMonths
    
    
    Six Months
    
    
    One Year
    
    
    Two Years
    
    
    Three Years
    
    
    Years
    
    
    Total(Dollars in thousands)Certificates of DepositsLess than 2%
    
    $
    379,424
    
    
    $
    759,438
    
    
    $
    529,760
    
    
    $
    199,924
    
    
    $
    3,491
    
    
    $
    131
    
    
    $
    1,872,1682.01% - 3.00%
    
    
    181,412
    
    
    
    137,958
    
    
    
    170,627
    
    
    
    311,655
    
    
    
    15,153
    
    
    
    33,324
    
    
    
    850,1293.01% - 4.00%
    
    
    83,243
    
    
    
    68,681
    
    
    
    25,103
    
    
    
    24,145
    
    
    
    22,859
    
    
    
    43,488
    
    
    
    267,5194.01% - 5.00%
    
    
    15,866
    
    
    
    11,216
    
    
    
    8,930
    
    
    
    65,289
    
    
    
    133,149
    
    
    
    34,010
    
    
    
    268,460Over 5.00%
    
    
    116
    
    
    
    312
    
    
    
    1,815
    
    
    
    9,288
    
    
    
    13,608
    
    
    
    9,514
    
    
    
    34,653Total
    
    $
    660,061
    
    
    $
    977,605
    
    
    $
    736,235
    
    
    $
    610,301
    
    
    $
    188,260
    
    
    $
    120,467
    
    
    $
    3,292,929
  AtDecember 31, 2009(In thousands)Three months or less
    
    $
    236,416Over three months through six months
    
    
    321,219Over six months through one year
    
    
    220,468Over one year
    
    
    324,131Total
    
    $
    1,102,234
 Borrowings.
 24




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##### Table of Contents



At or for the Six Month Period EndedDecember 31,
    
    
    At or for the Years Ended June 30,2009
    
    
    2008
    
    
    2009
    
    
    2008
    
    
    2007(Unaudited)(Dollars in thousands)Balance at end of period
    
    $
    850,542
    
    
    $
    1,223,569
    
    
    $
    870,555
    
    
    $
    563,583
    
    
    $
    333,710Average balance during period
    
    
    819,585
    
    
    
    1,280,026
    
    
    
    989,855
    
    
    
    208,866
    
    
    
    196,417Maximum outstanding at any month end
    
    
    870,553
    
    
    
    1,348,574
    
    
    
    1,348,574
    
    
    
    563,583
    
    
    
    333,710Weighted average interest rate at end of period
    
    
    3.79
    %
    
    
    2.90
    %
    
    
    3.66
    %
    
    
    3.50
    %
    
    
    5.42
    %Average interest rate during period
    
    
    3.82
    %
    
    
    3.05
    %
    
    
    3.34
    %
    
    
    4.41
    %
    
    
    5.46
    %
  At or for the Six Month Period EndedDecember 31,
    
    
    At or for the Years Ended June 30,2009
    
    
    2008
    
    
    2009
    
    
    2008
    
    
    2007(Unaudited)(Dollars in thousands)Balance at end of period
    
    $
    750,000
    
    
    $
    910,000
    
    
    $
    860,000
    
    
    $
    1,000,000
    
    
    $
    705,000Average balance during period
    
    
    823,620
    
    
    
    894,348
    
    
    
    902,326
    
    
    
    999,663
    
    
    
    925,280Maximum outstanding at any month end
    
    
    860,000
    
    
    
    1,085,000
    
    
    
    960,000
    
    
    
    1,109,500
    
    
    
    1,095,000Weighted average interest rate at end of period
    
    
    4.36
    %
    
    
    4.31
    %
    
    
    4.32
    %
    
    
    4.27
    %
    
    
    4.78
    %Average interest rate during period
    
    
    4.43
    %
    
    
    4.43
    %
    
    
    4.38
    %
    
    
    4.58
    %
    
    
    4.80
    %
 Subsidiary Activities
  ASB Investment Corp.
  ISB Mortgage Company LLC.
  ISB Asset Corporation.
 ISB Holdings, Inc.
 American Savings Investment Corp.
 25




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##### Table of Contents



Personnel
  SUPERVISION AND REGULATION
 General
     New Jersey Banking Regulation
 Activity Powers.
 
    
    real estate mortgages;
    
    consumer and commercial loans;
    
    specific types of debt securities, including certain corporate debt securities and
obligations of federal, state and local governments and agencies;
    
    certain types of corporate equity securities; and
    
    certain other assets.
  26




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##### Table of Contents



Loans-to-One-Borrower Limitations.
 Dividends.
 Minimum Capital Requirements.
 Examination and Enforcement.
 Federal Banking Regulation
 Capital Requirements.
  
    
    common stockholders equity, excluding the unrealized appreciation or depreciation, net
of tax, from available for sale securities;
    
    non-cumulative perpetual preferred stock, including any related retained earnings; and
    
    minority interests in consolidated subsidiaries minus all intangible assets, other than
qualifying servicing rights and any net unrealized loss on marketable equity securities.
  
    
    cumulative perpetual preferred stock;
    
    certain perpetual preferred stock for which the dividend rate may be reset
periodically;
    
    hybrid capital instruments, including mandatory convertible securities;
    
    term subordinated debt;
    
    intermediate term preferred stock;
    
    allowance for loan losses; and
    
    up to 45% of pretax net unrealized holding gains on available for sale equity
securities with readily determinable fair market values.
  27




---



##### Table of Contents




    
    the quality of the banks interest rate risk management process;
    
    the overall financial condition of the bank; and
    
    the level of other risks at the bank for which capital is needed.
  As of December 31, 2009PercentCapital
    
    
    of Assets(1)(Dollars in thousands)Total capital
    
    $
    749,585
    
    
    
    9.0
    %Tier 1 risk-based capital
    
    $
    749,585
    
    
    
    14.7
    %Total risk-based capital
    
    $
    804,637
    
    
    
    15.8
    %
 
 (1)
    
    For purposes of calculating Total capital, assets are based on
adjusted total average assets. In calculating Tier 1 risk-based
capital and Total risk-based capital, assets are based on total
risk-weighted assets.  Activity Restrictions on State-Chartered Banks.
   28




---



##### Table of Contents



Federal Home Loan Bank System.
  Safety and Soundness Standards.
  Enforcement.
 Prompt Corrective Action.
  
    
    its ratio of total capital to risk-weighted assets is at least 10%;
    
    its ratio of Tier 1 capital to risk-weighted assets is at least 6%; and
 29




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##### Table of Contents




    
    its ratio of Tier 1 capital to total assets is at least 5%, and it is not subject to
any order or directive by the FDIC to meet a specific capital level.
  
    
    its ratio of total capital to risk-weighted assets is at least 8%; or
    
    its ratio of Tier 1 capital to risk-weighted assets is at least 4%; and
    
    its ratio of Tier 1 capital to total assets is at least 4% (3% if the bank receives the
highest rating under the Uniform Financial Institutions Rating System) and it is not a
well-capitalized institution.
  
    
    its total risk-based capital is less than 8%; or
    
    its Tier 1 risk-based-capital is less than 4%; and
    
    its leverage ratio is less than 4%.
  
    
    its total risk-based capital is less than 6%;
    
    its Tier 1 capital is less than 3%; or
    
    its leverage ratio is less than 3%.
   
    
    insolvency, or when a assets of the bank are less than its liabilities to depositors
and others;
    
    substantial dissipation of assets or earnings through violations of law or unsafe or
unsound practices;
    
    existence of an unsafe or unsound condition to transact business;
    
    likelihood that the bank will be unable to meet the demands of its depositors or to pay
its obligations in the normal course of business; and
    
    insufficient capital, or the incurring or likely incurring of losses that will deplete
substantially all of the institutions capital with no reasonable prospect of replenishment
of capital without federal assistance.
  Liquidity.
 Deposit Insurance.
 30




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##### Table of Contents



Transactions with Affiliates of Investors Savings Bank.
  
    
    limits the extent to which a bank or its subsidiaries may engage in covered
transactions with any one affiliate to an amount equal to 10% of such banks capital stock
and retained earnings, and limits all such transactions with all affiliates to an amount
equal to 20% of such capital stock and retained earnings; and
    
    requires that all such transactions be on terms that are consistent with safe and sound
banking practices.
  31




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##### Table of Contents



Prohibitions Against Tying Arrangements.
 Privacy Standards.
    Community Reinvestment Act and Fair Lending Laws.
 
    
    a lending test, to evaluate the institutions record of making loans in its service
areas;
    
    an investment test, to evaluate the institutions record of investing in community
development projects, affordable housing, and programs benefiting low or moderate income
individuals and/or census tracts and businesses; and
    
    a service test, to evaluate the institutions delivery of services through its
branches, ATMs and other offices.
   Loans to a Banks Insiders
 Federal Regulation.
 32




---



##### Table of Contents



New Jersey Regulation.
 Federal Reserve System
  Interagency Guidance on Nontraditional Mortgage Product Risks.
  33




---



##### Table of Contents



Anti-Money Laundering and Customer Identification
   
    
    Establishment of anti-money laundering programs
    
    Establishment of a program specifying procedures for obtaining identifying information
from customers seeking to open new accounts, including verifying the identity of customers
within a reasonable period of time.
    
    Establishment of enhanced due diligence policies, procedures and controls designed to
detect and report money-laundering.
    
    Prohibitions on correspondent accounts for foreign shell banks and compliance with
record keeping obligations with respect to correspondent accounts of foreign banks.
    
    Bank regulators are directed to consider a holding companys effectiveness in combating
money laundering when ruling on Federal Reserve Act and Bank Merger Act applications.
  Sarbanes-Oxley Act of 2002
  Holding Company Regulation
 Federal Regulation.
 34




---



##### Table of Contents




    
    making or servicing loans;
    
    performing certain data processing services;
    
    providing discount brokerage services; or acting as fiduciary, investment or financial
advisor;
    
    leasing personal or real property;
    
    making investments in corporations or projects designed primarily to promote community
welfare; and
    
    acquiring a savings and loan association.
  
    
    each of its depository institution subsidiaries is well capitalized;
    
    each of its depository institution subsidiaries is well managed;
    
    each of its depository institution subsidiaries has at least a satisfactory Community
Reinvestment Act rating at its most recent examination; and
    
    the bank holding company has filed a certification with the Federal Reserve Board
stating that it elects to become a financial holding company.
   35




---



##### Table of Contents



Conversion of Investors Bancorp, MHC to Stock Form.
   New Jersey Regulation.
 Acquisition of Investors Bancorp, Inc.
 Federal Securities Laws.
  36




---



##### Table of Contents



TAXATION
 Federal Taxation
 General.
 Method of Accounting.
 Bad Debt Reserves.
  Taxable Distributions and Recapture.
  Alternative Minimum Tax.
 Net Operating Loss Carryforwards and Charitable Contribution Carryforward.
  Corporate Dividends-Received Deduction.
 State Taxation
 New Jersey State Taxation.
 37




---



##### Table of Contents



Delaware State Taxation.
 
 ITEM 1A. RISK FACTORS
  Our Liabilities Reprice Faster Than Our Assets and Future Increases in Interest Rates Will Reduce
Our Profits.
  
    
    the interest income we earn on our interest-earning assets, such as loans and
securities; and
    
    the interest expense we pay on our interest-bearing liabilities, such as deposits and
borrowings.
   38




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##### Table of Contents



Because We Intend to Continue to Increase Our Commercial Originations, Our Lending Risk Will
Increase.
  The U.S. Economy Is Experiencing An Economic Downturn. A Continuation or Further Deterioration Will
Have An Adverse Effect On Our Operations.
   Any Future FDIC Insurance Premiums Will Adversely Impact Our Earnings.
  39




---



##### Table of Contents



If Our Allowance for Loan Losses is Not Sufficient to Cover Actual Loan Losses, Our Earnings Could
Decrease.
   Our Inability to Achieve Profitability on New Branches May Negatively Affect Our Earnings.
 de novo
 Strong Competition Within Our Market Area May Limit Our Growth and Profitability.
  If We Declare Dividends on Our Common Stock, Investors Bancorp, MHC Will be Prohibited From Waiving
the Receipt of Dividends by Current Federal Reserve Board Policy, Which May Result in Lower
Dividends for All Other Stockholders.
  40




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##### Table of Contents



Investors
Bancorp, MHC Exercises Voting Control Over Investors Bancorp; Public
Stockholders Own a Minority Interest
  We Operate in a Highly Regulated Industry, Which Limits the Manner and Scope of Our Business
Activities.
  Future Acquisition Activity Could Dilute Book Value
  
 ITEM 1B. UNRESOLVED STAFF COMMENTS
  
 ITEM 2. PROPERTIES
  
 ITEM 3. LEGAL PROCEEDINGS
  41




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##### Table of Contents



PART II
 
 ITEM 4. MARKET FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
  Year Ended
    
    Year EndedDecember 31, 2009
    
    December 31, 2008High
    
    Low
    
    Dividends
    
    High
    
    Low
    
    DividendsFirst Quarter
    
    $
    13.29
    
    
    $
    6.86
    
    
    $
    
    
    
    $
    15.59
    
    
    $
    13.17
    
    
    $
    Second Quarter
    
    
    9.71
    
    
    
    8.14
    
    
    
    
    
    
    
    15.75
    
    
    
    13.06
    
    
    
    Third Quarter
    
    
    10.94
    
    
    
    8.72
    
    
    
    
    
    
    
    16.15
    
    
    
    12.59
    
    
    
    Fourth Quarter
    
    
    11.15
    
    
    
    10.25
    
    
    
    
    
    
    
    15.00
    
    
    
    12.39
    
    
    
    
     42




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##### Table of Contents



Stock Performance Graph
  INVESTORS BANCORP, INC.
 Total Return Performance
 
 Period EndingIndex
    
    10/12/05
    
    12/31/05
    
    06/30/06
    
    12/31/06
    
    06/30/07
    
    12/31/07
    
    06/30/08
    
    12/31/08
    
    06/30/09
    
    12/31/09Investors Bancorp, Inc.
    
    
    100.00
    
    
    
    110.08
    
    
    
    135.23
    
    
    
    156.99
    
    
    
    134.03
    
    
    
    141.12
    
    
    
    130.34
    
    
    
    134.03
    
    
    
    91.82
    
    
    
    109.18SNL Bank and Thrift Index
    
    
    100.00
    
    
    
    110.59
    
    
    
    116.36
    
    
    
    129.22
    
    
    
    123.80
    
    
    
    98.54
    
    
    
    68.68
    
    
    
    56.67
    
    
    
    48.71
    
    
    
    55.91SNL Thrift Index
    
    
    100.00
    
    
    
    112.84
    
    
    
    121.62
    
    
    
    131.54
    
    
    
    120.31
    
    
    
    78.91
    
    
    
    62.25
    
    
    
    50.22
    
    
    
    42.18
    
    
    
    46.83
 
 *
    
    Source : SNL Financial LC, Charlottesville, VA  Total Number of
    
    Average
    
    As part of Publicly
    
    Yet Be PurchasedShares
    
    Price paid
    
    Announced Plans
    
    Under the Plans orPeriod
    
    Purchased(1)
    
    Per Share
    
    or Programs
    
    ProgramsOctober 1, 2009 through October 31, 2009
    
    
    
    
    
    $
    
    
    
    
    
    
    
    
    2,928,436November 1, 2009 through November 30, 2009
    
    
    49,632
    
    
    
    10.80
    
    
    
    49,632
    
    
    
    2,878,804December 1, 2009 through December 31, 2009
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,878,804Total
    
    
    49,632
    
    
    
    
    
    
    
    49,632
 
 (1)
    
    On January 22, 2008, the Company announced its third Share Repurchase
Program, which authorized the purchase of an additional 10% of its
publicly-held outstanding shares of common stock, or 4,307,248 shares.
This stock repurchase program commenced upon the completion of the
second program on May 7, 2008. This program has no expiration date and
has 2,878,804 shares yet to be purchased as of December 31, 2009. 43




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##### Table of Contents



ITEM 5. SELECTED FINANCIAL DATA
  At December 31,
    
    At June 30,2009
    
    2009
    
    2008
    
    2007
    
    2006
    
    2005(In thousands)Selected Financial Condition Data:Total assets
    
    $
    8,357,816
    
    
    $
    8,136,432
    
    
    $
    6,419,142
    
    
    $
    5,722,026
    
    
    $
    5,631,809
    
    
    $
    5,142,575Loans receivable, net
    
    
    6,615,459
    
    
    
    6,143,169
    
    
    
    4,670,150
    
    
    
    3,624,998
    
    
    
    2,995,435
    
    
    
    2,028,045Loans held-for-sale
    
    
    27,043
    
    
    
    61,691
    
    
    
    9,814
    
    
    
    3,410
    
    
    
    974
    
    
    
    3,412Securities held to maturity, net
    
    
    717,441
    
    
    
    846,043
    
    
    
    1,255,054
    
    
    
    1,578,922
    
    
    
    1,835,581
    
    
    
    2,128,944Securities available for sale, at
estimated fair value
    
    
    471,243
    
    
    
    355,016
    
    
    
    203,032
    
    
    
    257,939
    
    
    
    538,526
    
    
    
    683,701Bank owned life insurance
    
    
    114,542
    
    
    
    113,191
    
    
    
    96,170
    
    
    
    92,198
    
    
    
    82,603
    
    
    
    79,779Deposits
    
    
    5,840,643
    
    
    
    5,505,747
    
    
    
    3,970,275
    
    
    
    3,768,188
    
    
    
    3,419,361
    
    
    
    3,373,291Borrowed funds
    
    
    1,600,542
    
    
    
    1,730,555
    
    
    
    1,563,583
    
    
    
    1,038,710
    
    
    
    1,245,740
    
    
    
    1,313,769Stockholders equity
    
    
    850,213
    
    
    
    819,283
    
    
    
    828,538
    
    
    
    858,859
    
    
    
    916,291
    
    
    
    423,704
 Six Months EndedDecember 31,
    
    Years Ended June 30,2009
    
    2008 (1)
    
    2009(1)
    
    2008
    
    2007(2)
    
    2006(3)
    
    2005(4)(Unaudited)(In thousands)Selected Operating Data:Interest and dividend income
    
    $
    198,272
    
    
    $
    181,947
    
    
    $
    368,060
    
    
    $
    312,807
    
    
    $
    285,223
    
    
    $
    252,050
    
    
    $
    232,594Interest expense
    
    
    90,471
    
    
    
    100,299
    
    
    
    201,924
    
    
    
    207,695
    
    
    
    195,263
    
    
    
    143,594
    
    
    
    128,286Net interest income
    
    
    107,801
    
    
    
    81,648
    
    
    
    166,136
    
    
    
    105,112
    
    
    
    89,960
    
    
    
    108,456
    
    
    
    104,308Provision for loan losses
    
    
    23,425
    
    
    
    13,000
    
    
    
    29,025
    
    
    
    6,646
    
    
    
    729
    
    
    
    600
    
    
    
    604Net interest income after
provision for loan losses
    
    
    84,376
    
    
    
    68,648
    
    
    
    137,111
    
    
    
    98,466
    
    
    
    89,231
    
    
    
    107,856
    
    
    
    103,704Non-interest income (loss)
    
    
    9,007
    
    
    
    (154,258
    )
    
    
    (148,430
    )
    
    
    7,373
    
    
    
    3,175
    
    
    
    5,972
    
    
    
    (2,080
    )Non-interest expenses
    
    
    56,500
    
    
    
    45,181
    
    
    
    97,799
    
    
    
    80,780
    
    
    
    77,617
    
    
    
    90,877
    
    
    
    107,173Income (loss) before income
tax expense (benefit)
    
    
    36,883
    
    
    
    (130,791
    )
    
    
    (109,118
    )
    
    
    25,059
    
    
    
    14,789
    
    
    
    22,951
    
    
    
    (5,549
    )Income tax expense (benefit)
    
    
    14,321
    
    
    
    (53,323
    )
    
    
    (44,200
    )
    
    
    9,030
    
    
    
    (7,477
    )
    
    
    7,610
    
    
    
    (2,986
    )Net income (loss)
    
    $
    22,562
    
    
    $
    (77,468
    )
    
    $
    (64,918
    )
    
    $
    16,029
    
    
    $
    22,266
    
    
    $
    15,341
    
    
    $
    (2,563
    )Earnings (loss) per share 
basic and diluted(5)
    
    $
    0.21
    
    
    $
    (0.75
    )
    
    $
    (0.62
    )
    
    $
    0.15
    
    
    $
    0.20
    
    
    $
    0.07
    
    
    
    n/a
 
 (1)
    
    June 30, 2009 year end results and the December 31, 2008 six month
results reflect a $158.0 million pre-tax OTTI charge related to our
trust preferred securities.(2)
    
    June 30, 2007 year end results reflect a $9.9 million reversal of
previously established valuation allowances for deferred tax assets.(3)
    
    June 30, 2006 year end results reflect a pre-tax expense of $20.7
million for the charitable contribution made to Investors Savings Bank
Charitable Foundation as part of our initial public offering.(4)
    
    June 30, 2005 year end results reflect pre-tax expense of $54.0
million attributable to the March 2005 balance sheet restructuring.(5)
    
    Basic and diluted earnings per share for the year ended June 30, 2006
include the results of operations from October 11, 2005, the date the
Company completed its initial public offering. 44




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##### Table of Contents



At or for the Six MonthsEnded December 31,
    
    At or for the Years Ended June, 302009
    
    2008
    
    2009
    
    2008
    
    2007
    
    2006
    
    2005(Unaudited)Selected Financial Ratios and Other Data:Performance Ratios:Return (loss) on assets (ratio of net income or loss
to average total assets)
    
    
    0.55
    %
    
    
    (2.24
    )%
    
    
    (0.90
    )%
    
    
    0.27
    %
    
    
    0.39
    %
    
    
    0.28
    %
    
    
    (0.05
    )%(Return (loss) on equity (ratio of net income or loss
to average equity)
    
    
    5.46
    %
    
    
    (18.75
    )%
    
    
    (8.14
    )%
    
    
    1.92
    %
    
    
    2.47
    %
    
    
    2.00
    %
    
    
    (0.62
    )%Net interest rate spread(1)
    
    
    2.49
    %
    
    
    2.05
    %
    
    
    2.06
    %
    
    
    1.28
    %
    
    
    1.02
    %
    
    
    1.65
    %
    
    
    1.82
    %Net interest margin(2)
    
    
    2.72
    %
    
    
    2.42
    %
    
    
    2.38
    %
    
    
    1.81
    %
    
    
    1.65
    %
    
    
    2.06
    %
    
    
    2.00
    %Efficiency ratio(3)
    
    
    48.37
    %
    
    
    (62.22
    )%
    
    
    552.35
    %
    
    
    71.81
    %
    
    
    83.34
    %
    
    
    79.42
    %
    
    
    104.84
    %Efficiency ratio (excluding OTTI and FDIC special
assessment) (4)
    
    
    48.33
    %
    
    
    53.40
    %
    
    
    54.39
    %
    
    
    71.55
    %
    
    
    83.34
    %
    
    
    79.42
    %
    
    
    104.84
    %Non-interest expenses to average total assets
    
    
    1.37
    %
    
    
    1.30
    %
    
    
    1.35
    %
    
    
    1.35
    %
    
    
    1.38
    %
    
    
    1.68
    %
    
    
    2.00
    %Average interest-earning assets to average
interest-bearing liabilities
    
    
    1.10x
    
    
    
    1.13x
    
    
    
    1.11x
    
    
    
    1.15x
    
    
    
    1.18x
    
    
    
    1.15x
    
    
    
    1.07xAsset Quality Ratios:Non-performing assets to total assets
    
    
    1.44
    %
    
    
    0.67
    %
    
    
    1.50
    %
    
    
    0.30
    %
    
    
    0.09
    %
    
    
    0.06
    %
    
    
    0.15
    %Non-performing loans to total loans
    
    
    1.81
    %
    
    
    0.85
    %
    
    
    1.97
    %
    
    
    0.42
    %
    
    
    0.14
    %
    
    
    0.11
    %
    
    
    0.39
    %Allowance for loan losses to non-performing loans
    
    
    45.80
    %
    
    
    55.53
    %
    
    
    38.30
    %
    
    
    70.03
    %
    
    
    135.00
    %
    
    
    193.06
    %
    
    
    72.77
    %Allowance for loan losses to total loans
    
    
    0.83
    %
    
    
    0.47
    %
    
    
    0.76
    %
    
    
    0.29
    %
    
    
    0.19
    %
    
    
    0.21
    %
    
    
    0.28
    %Capital Ratios:Risk-based capital (to risk-weighted assets)(5)
    
    
    15.78
    %
    
    
    17.35
    %
    
    
    16.88
    %
    
    
    21.77
    %
    
    
    25.18
    %
    
    
    26.63
    %
    
    
    21.72
    %Tier I risk-based capital (to risk-weighted assets)(5)
    
    
    14.70
    %
    
    
    16.67
    %
    
    
    15.86
    %
    
    
    21.37
    %
    
    
    24.93
    %
    
    
    26.38
    %
    
    
    21.44
    %Total capital (to average assets)(5)
    
    
    9.03
    %
    
    
    9.04
    %
    
    
    9.52
    %
    
    
    11.93
    %
    
    
    12.52
    %
    
    
    12.25
    %
    
    
    8.35
    %Equity to total assets
    
    
    10.17
    %
    
    
    10.49
    %
    
    
    10.07
    %
    
    
    12.91
    %
    
    
    15.01
    %
    
    
    16.27
    %
    
    
    8.24
    %Average equity to average assets
    
    
    9.99
    %
    
    
    11.92
    %
    
    
    11.05
    %
    
    
    13.94
    %
    
    
    15.97
    %
    
    
    14.21
    %
    
    
    7.75
    %Tangible capital (to tangible assets)
    
    
    9.83
    %
    
    
    10.48
    %
    
    
    9.78
    %
    
    
    12.89
    %
    
    
    15.01
    %
    
    
    16.26
    %
    
    
    8.24
    %Book value per common share
    
    $
    7.67
    
    
    $
    7.15
    
    
    $
    7.38
    
    
    $
    7.87
    
    
    $
    7.86
    
    
    $
    8.04
    
    
    
    n/aOther Data:Number of full service offices
    
    
    65
    
    
    
    52
    
    
    
    58
    
    
    
    52
    
    
    
    51
    
    
    
    51
    
    
    
    51Full time equivalent employees
    
    
    704
    
    
    
    554
    
    
    
    647
    
    
    
    537
    
    
    
    509
    
    
    
    510
    
    
    
    493
 
 (1)
    
    The net interest rate spread represents the difference between the weighted-average yield on interest-earning assets
and the weighted- average cost of interest-bearing liabilities for the period.(2)
    
    The net interest margin represents net interest income as a percent of average interest-earning assets for the period.(3)
    
    The efficiency ratio represents non-interest expenses divided by the sum of net interest income and non-interest income.(4)
    
    Excludes OTTI of $91,000 and $157.2 million for the six months ended December 31, 2009 and 2008, respectively and
$158.5 and $409,000 for the years ended June 30, 2009 and 2008,
respectively. Also excludes FDIC special assessment of
$3.6 million at June 30, 2009.(5)
    
    Ratios are for Investors Savings Bank and do not include capital retained at the holding company level. 
 ITEM 6. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
   45




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##### Table of Contents



Critical Accounting Policies
  Allowance for Loan Losses.
 46




---



##### Table of Contents



47




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##### Table of Contents



Deferred Income Taxes. Income
Taxes,
 Securities Impairment Judgments.
  Goodwill Impairment.
 Valuation of Mortgage Servicing Rights (MSR).
  48




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##### Table of Contents



Stock-Based Compensation.
   Comparison of Financial Condition at December 31, 2009 and June 30, 2009
 Total Assets.
 Net Loans.
    49




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##### Table of Contents



December 31, 2009
    
    
    September 30, 2009
    
    
    June 30, 2009
    
    
    March 31, 2009# of loans
    
    
    Amount
    
    
    # of loans
    
    
    Amount
    
    
    # of loans
    
    
    Amount
    
    
    # of loans
    
    
    Amount(Dollars in Millions)Residential and consumer
    
    
    185
    
    
    $
    51.2
    
    
    
    164
    
    
    $
    41.0
    
    
    
    112
    
    
    $
    30.0
    
    
    
    66
    
    
    $
    17.5Multi-family
    
    
    4
    
    
    
    0.6
    
    
    
    4
    
    
    
    0.6
    
    
    
    4
    
    
    
    20.1
    
    
    
    4
    
    
    
    19.8Commercial
    
    
    10
    
    
    
    3.4
    
    
    
    9
    
    
    
    3.4
    
    
    
    8
    
    
    
    2.8
    
    
    
    2
    
    
    
    1.9Construction
    
    
    22
    
    
    
    65.0
    
    
    
    22
    
    
    
    70.5
    
    
    
    19
    
    
    
    68.8
    
    
    
    9
    
    
    
    40.9Total non-performing loans
    
    
    221
    
    
    $
    120.2
    
    
    
    199
    
    
    $
    115.5
    
    
    
    143
    
    
    $
    121.7
    
    
    
    81
    
    
    $
    80.1Non-performing loans to total loans
    
    
    
    
    
    
    1.81
    %
    
    
    
    
    
    
    1.82
    %
    
    
    
    
    
    
    1.97
    %
    
    
    
    
    
    
    1.44
    %Allowance for loan loss as a
percent of non-performing loans
    
    
    
    
    
    
    45.80
    %
    
    
    
    
    
    
    46.35
    %
    
    
    
    
    
    
    38.30
    %
    
    
    
    
    
    
    43.10
    %Allowance for loan loss as a
percent of total loans
    
    
    
    
    
    
    0.83
    %
    
    
    
    
    
    
    0.84
    %
    
    
    
    
    
    
    0.76
    %
    
    
    
    
    
    
    0.62
    %
    Securities.
  Other Assets, Stock in the Federal Home Loan Bank, Bank Owned Life Insurance, and Intangible
Assets.
 50




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##### Table of Contents



Deposits.
 Borrowed Funds.
 Stockholders Equity.
 Analysis of Net Interest Income
  Average Balances and Yields.
 For Six Months Ended December 31,2009
    
    
    2008(Unaudited)Average
    
    
    Interest
    
    
    Average
    
    
    Average
    
    
    Interest
    
    
    AverageOutstanding
    
    
    Earned/
    
    
    Yield/
    
    
    Outstanding
    
    
    Earned/
    
    
    Yield/Balance
    
    
    Paid
    
    
    Rate
    
    
    Balance
    
    
    Paid
    
    
    Rate(In thousands)Interest-earning assets:Interest-bearing deposits
    
    $
    304,293
    
    
    $
    346
    
    
    
    0.23
    %
    
    $
    19,221
    
    
    $
    39
    
    
    
    0.41
    %Securities available-for-sale(1)
    
    
    406,462
    
    
    
    5,926
    
    
    
    2.92
    
    
    
    196,848
    
    
    
    4,491
    
    
    
    4.56Securities held-to-maturity
    
    
    779,405
    
    
    
    17,404
    
    
    
    4.47
    
    
    
    1,203,268
    
    
    
    27,222
    
    
    
    4.52Net loans
    
    
    6,370,350
    
    
    
    172,575
    
    
    
    5.42
    
    
    
    5,241,754
    
    
    
    148,771
    
    
    
    5.68Stock in FHLB
    
    
    68,122
    
    
    
    2,021
    
    
    
    5.93
    
    
    
    79,496
    
    
    
    1,424
    
    
    
    3.58Total interest-earning assets
    
    
    7,928,632
    
    
    
    198,272
    
    
    
    5.00
    
    
    
    6,740,587
    
    
    
    181,947
    
    
    
    5.40Non-interest-earning assets
    
    
    335,411
    
    
    
    
    
    
    
    
    
    
    
    191,168Total assets
    
    $
    8,264,043
    
    
    
    
    
    
    
    
    
    
    $
    6,931,755Interest-bearing liabilities:Savings deposits
    
    $
    835,109
    
    
    
    7,615
    
    
    
    1.82
    %
    
    $
    395,448
    
    
    
    3,650
    
    
    
    1.85
    %Interest-bearing checking
    
    
    802,474
    
    
    
    4,426
    
    
    
    1.10
    
    
    
    371,200
    
    
    
    2,842
    
    
    
    1.53Money market accounts
    
    
    608,710
    
    
    
    4,392
    
    
    
    1.44
    
    
    
    265,074
    
    
    
    3,024
    
    
    
    2.28Certificates of deposit
    
    
    3,321,607
    
    
    
    40,144
    
    
    
    2.42
    
    
    
    2,968,288
    
    
    
    53,421
    
    
    
    3.60Total interest-bearing deposits
    
    
    5,567,900
    
    
    
    56,577
    
    
    
    2.03
    
    
    
    4,000,010
    
    
    
    62,937
    
    
    
    3.15Borrowed funds
    
    
    1,643,205
    
    
    
    33,894
    
    
    
    4.13
    
    
    
    1,990,807
    
    
    
    37,362
    
    
    
    3.75Total interest-bearing liabilities
    
    
    7,211,105
    
    
    
    90,471
    
    
    
    2.51
    
    
    
    5,990,817
    
    
    
    100,299
    
    
    
    3.35Non-interest-bearing liabilities
    
    
    226,956
    
    
    
    
    
    
    
    
    
    
    
    114,409Total liabilities
    
    
    7,438,061
    
    
    
    
    
    
    
    
    
    
    
    6,105,226Stockholders equity
    
    
    825,982
    
    
    
    
    
    
    
    
    
    
    
    826,529Total liabilities and stockholders equity
    
    $
    8,264,043
    
    
    
    
    
    
    
    
    
    
    $
    6,931,755Net interest income
    
    
    
    
    
    $
    107,801
    
    
    
    
    
    
    
    
    
    
    $
    81,648Net interest rate spread(2)
    
    
    
    
    
    
    
    
    
    
    2.49
    %
    
    
    
    
    
    
    
    
    
    
    2.05
    %Net interest-earning assets(3)
    
    $
    717,527
    
    
    
    
    
    
    
    
    
    
    $
    749,770Net interest margin(4)
    
    
    
    
    
    
    
    
    
    
    2.72
    %
    
    
    
    
    
    
    
    
    
    
    2.42
    %Ratio of interest-earning assets to total
interest-bearing liabilities
    
    
    1.10x
    
    
    
    
    
    
    
    
    
    
    
    1.13x
 
 (1)
    
    Securities available-for-sale are stated at amortized cost, adjusted for unamortized purchased premiums and discounts.(2)
    
    Net interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities.(3)
    
    Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.(4)
    
    Net interest margin represents net interest income divided by average total interest-earning assets. 51




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##### Table of Contents



For the Years Ended June 30,2009
    
    
    2008
    
    
    2007Average
    
    
    Interest
    
    
    Average
    
    
    Average
    
    
    Interest
    
    
    Average
    
    
    Average
    
    
    Interest
    
    
    AverageOutstanding
    
    
    Earned/
    
    
    Yield/
    
    
    Outstanding
    
    
    Earned/
    
    
    Yield/
    
    
    Outstanding
    
    
    Earned/
    
    
    Yield/Balance
    
    
    Paid
    
    
    Rate
    
    
    Balance
    
    
    Paid
    
    
    Rate
    
    
    Balance
    
    
    Paid
    
    
    Rate(Dollars in thousands)Interest-earning assets:Interest-bearing deposits
    
    $
    158,743
    
    
    $
    393
    
    
    
    0.25
    %
    
    $
    32,948
    
    
    $
    974
    
    
    
    2.96
    %
    
    $
    25,701
    
    
    $
    993
    
    
    
    3.86
    %Repurchase agreements and federal funds sold
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,798
    
    
    
    162
    
    
    
    2.79
    
    
    
    
    
    
    
    
    
    
    
    Securities available-for-sale(1)
    
    
    197,824
    
    
    
    8,968
    
    
    
    4.53
    
    
    
    235,385
    
    
    
    10,826
    
    
    
    4.60
    
    
    
    406,274
    
    
    
    18,006
    
    
    
    4.43Securities held-to-maturity
    
    
    1,074,279
    
    
    
    50,917
    
    
    
    4.74
    
    
    
    1,438,804
    
    
    
    67,977
    
    
    
    4.72
    
    
    
    1,689,890
    
    
    
    80,310
    
    
    
    4.75Net loans
    
    
    5,482,009
    
    
    
    304,678
    
    
    
    5.56
    
    
    
    4,043,398
    
    
    
    229,634
    
    
    
    5.68
    
    
    
    3,305,807
    
    
    
    182,996
    
    
    
    5.54Stock in FHLB
    
    
    75,938
    
    
    
    3,104
    
    
    
    4.09
    
    
    
    44,939
    
    
    
    3,234
    
    
    
    7.20
    
    
    
    40,304
    
    
    
    2,918
    
    
    
    7.24Total interest-earning assets
    
    
    6,988,793
    
    
    
    368,060
    
    
    
    5.27
    
    
    
    5,801,272
    
    
    
    312,807
    
    
    
    5.39
    
    
    
    5,467,976
    
    
    
    285,223
    
    
    
    5.22Non-interest-earning assets
    
    
    231,122
    
    
    
    
    
    
    
    
    
    
    
    185,705
    
    
    
    
    
    
    
    
    
    
    
    170,671Total assets
    
    $
    7,219,915
    
    
    
    
    
    
    
    
    
    
    $
    5,986,977
    
    
    
    
    
    
    
    
    
    
    $
    5,638,647Interest-bearing liabilities:Savings deposits
    
    $
    507,132
    
    
    
    10,568
    
    
    
    2.08
    %
    
    $
    372,846
    
    
    
    7,718
    
    
    
    2.07
    %
    
    $
    302,331
    
    
    
    4,685
    
    
    
    1.55Interest-bearing checking
    
    
    565,278
    
    
    
    11,668
    
    
    
    2.06
    
    
    
    353,564
    
    
    
    7,329
    
    
    
    2.07
    
    
    
    321,155
    
    
    
    7,473
    
    
    
    2.33Money market accounts
    
    
    310,656
    
    
    
    6,466
    
    
    
    2.08
    
    
    
    204,952
    
    
    
    5,005
    
    
    
    2.44
    
    
    
    185,849
    
    
    
    3,596
    
    
    
    1.93Certificates of deposit
    
    
    3,015,955
    
    
    
    100,660
    
    
    
    3.34
    
    
    
    2,909,550
    
    
    
    132,693
    
    
    
    4.56
    
    
    
    2,719,327
    
    
    
    124,382
    
    
    
    4.57Total interest-bearing deposits
    
    
    4,399,021
    
    
    
    129,362
    
    
    
    2.94
    
    
    
    3,840,912
    
    
    
    152,745
    
    
    
    3.98
    
    
    
    3,528,662
    
    
    
    140,136
    
    
    
    3.97Borrowed funds
    
    
    1,892,181
    
    
    
    72,562
    
    
    
    3.83
    
    
    
    1,208,529
    
    
    
    54,950
    
    
    
    4.55
    
    
    
    1,121,697
    
    
    
    55,127
    
    
    
    4.91Total interest-bearing liabilities
    
    
    6,291,202
    
    
    
    201,924
    
    
    
    3.21
    
    
    
    5,049,441
    
    
    
    207,695
    
    
    
    4.11
    
    
    
    4,650,359
    
    
    
    195,263
    
    
    
    4.20Non-interest-bearing liabilities
    
    
    131,219
    
    
    
    
    
    
    
    
    
    
    
    102,828
    
    
    
    
    
    
    
    
    
    
    
    87,946Total liabilities
    
    
    6,422,421
    
    
    
    
    
    
    
    
    
    
    
    5,152,269
    
    
    
    
    
    
    
    
    
    
    
    4,738,305Stockholders equity
    
    
    797,494
    
    
    
    
    
    
    
    
    
    
    
    834,708
    
    
    
    
    
    
    
    
    
    
    
    900,342Total liabilities and stockholders equity
    
    $
    7,219,915
    
    
    
    
    
    
    
    
    
    
    $
    5,986,977
    
    
    
    
    
    
    
    
    
    
    $
    5,638,647Net interest income
    
    
    
    
    
    $
    166,136
    
    
    
    
    
    
    
    
    
    
    $
    105,112
    
    
    
    
    
    
    
    
    
    
    $
    89,960Net interest rate spread(2)
    
    
    
    
    
    
    
    
    
    
    2.06
    %
    
    
    
    
    
    
    
    
    
    
    1.28
    %
    
    
    
    
    
    
    
    
    
    
    1.02
    %Net interest-earning assets(3)
    
    $
    697,591
    
    
    
    
    
    
    
    
    
    
    $
    751,831
    
    
    
    
    
    
    
    
    
    
    $
    817,617Net interest margin(4)
    
    
    
    
    
    
    
    
    
    
    2.38
    %
    
    
    
    
    
    
    
    
    
    
    1.81
    %
    
    
    
    
    
    
    
    
    
    
    1.65
    %Ratio of interest-earning assets to total
interest-bearing liabilities
    
    
    1.11
    x
    
    
    
    
    
    
    
    
    
    
    1.15
    x
    
    
    
    
    
    
    
    
    
    
    1.18
    x
 
 (1)
    
    Securities available-for-sale are stated at amortized cost, adjusted for unamortized purchased premiums and discounts.(2)
    
    Net interest rate spread represents the difference between the yield on average interest-earning assets and the cost
of average interest-bearing liabilities.(3)
    
    Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.(4)
    
    Net interest margin represents net interest income divided by average total interest-earning assets. 52




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##### Table of Contents



Rate/Volume Analysis
  Six Months Ended December 31,
    
    
    Years Ended June 30,
    
    
    Years Ended June 30,2009 vs. 2008
    
    
    2009 vs. 2008
    
    
    2008 vs. 2007Increase (Decrease)
    
    
    Net
    
    
    Increase (Decrease)
    
    
    Net
    
    
    Increase (Decrease)
    
    
    NetDue to
    
    
    Increase
    
    
    Due to
    
    
    Increase
    
    
    Due to
    
    
    IncreaseVolume
    
    
    Rate
    
    
    (Decrease)
    
    
    Volume
    
    
    Rate
    
    
    (Decrease)
    
    
    Volume
    
    
    Rate
    
    
    (Decrease)(In thousands)Interest-earning assets:Interest-bearing deposits
    
    $
    365
    
    
    $
    (58
    )
    
    $
    307
    
    
    $
    971
    
    
    $
    (1,552
    )
    
    $
    (581
    )
    
    $
    244
    
    
    $
    (263
    )
    
    $
    (19
    )Repurchase agreements
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (162
    )
    
    
    
    
    
    
    (162
    )
    
    
    162
    
    
    
    
    
    
    
    162Securities available-for-sale
    
    
    3,799
    
    
    
    (2,364
    )
    
    
    1,435
    
    
    
    (1,818
    )
    
    
    (40
    )
    
    
    (1,858
    )
    
    
    (7,839
    )
    
    
    659
    
    
    
    (7,180
    )Securities held-to-maturity
    
    
    (15,169
    )
    
    
    5,351
    
    
    
    (9,818
    )
    
    
    (17,644
    )
    
    
    584
    
    
    
    (17,060
    )
    
    
    (10,946
    )
    
    
    (1,387
    )
    
    
    (12,333
    )Net loans
    
    
    44,655
    
    
    
    (20,851
    )
    
    
    23,804
    
    
    
    82,755
    
    
    
    (7,711
    )
    
    
    75,044
    
    
    
    43,961
    
    
    
    2,677
    
    
    
    46,638Stock in FHLB
    
    
    (562
    )
    
    
    1,159
    
    
    
    597
    
    
    
    1,638
    
    
    
    (1,768
    )
    
    
    (130
    )
    
    
    334
    
    
    
    (18
    )
    
    
    316Total interest-earning assets
    
    
    33,088
    
    
    
    (16,763
    )
    
    
    16,325
    
    
    
    65,740
    
    
    
    (10,487
    )
    
    
    55,253
    
    
    
    25,916
    
    
    
    1,668
    
    
    
    27,584Interest-bearing liabilities:Savings deposits
    
    
    4,097
    
    
    
    (132
    )
    
    
    3,965
    
    
    
    2,798
    
    
    
    52
    
    
    
    2,850
    
    
    
    1,243
    
    
    
    1,790
    
    
    
    3,033Interest-bearing checking
    
    
    3,839
    
    
    
    (2,255
    )
    
    
    1,584
    
    
    
    4,370
    
    
    
    (31
    )
    
    
    4,339
    
    
    
    715
    
    
    
    (859
    )
    
    
    (144
    )Money market accounts
    
    
    4,530
    
    
    
    (3,162
    )
    
    
    1,368
    
    
    
    2,285
    
    
    
    (824
    )
    
    
    1,461
    
    
    
    397
    
    
    
    1,012
    
    
    
    1,409Certificates of deposit
    
    
    15,138
    
    
    
    (28,415
    )
    
    
    (13,277
    )
    
    
    4,697
    
    
    
    (36,730
    )
    
    
    (32,033
    )
    
    
    8,676
    
    
    
    (365
    )
    
    
    8,311Total deposits
    
    
    27,604
    
    
    
    (33,964
    )
    
    
    (6,360
    )
    
    
    14,150
    
    
    
    (37,533
    )
    
    
    (23,383
    )
    
    
    11,031
    
    
    
    1,578
    
    
    
    12,609Borrowed funds
    
    
    (10,322
    )
    
    
    6,854
    
    
    
    (3,468
    )
    
    
    22,283
    
    
    
    (4,671
    )
    
    
    17,612
    
    
    
    4,111
    
    
    
    (4,288
    )
    
    
    (177
    )Total interest-bearing liabilities
    
    
    17,282
    
    
    
    (27,110
    )
    
    
    (9,828
    )
    
    
    36,433
    
    
    
    (42,204
    )
    
    
    (5,771
    )
    
    
    15,142
    
    
    
    (2,710
    )
    
    
    12,432Increase (decrease) in net
interest income
    
    $
    15,806
    
    
    $
    10,347
    
    
    $
    26,153
    
    
    $
    29,307
    
    
    $
    31,717
    
    
    $
    61,024
    
    
    $
    10,774
    
    
    $
    4,378
    
    
    $
    15,152
 53




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##### Table of Contents



Comparison of Operating Results for the Six Month Period Ended December 31, 2009 and 2008
 Net Income.
 Net Interest Income.
 Interest and Dividend Income.
   Interest Expense.
   54




---



##### Table of Contents



Provision for Loan Losses.
 Non-Interest Income.
 Non-Interest Expenses.
 Income Taxes.
 Comparison of Operating Results for the Years Ended June 30, 2009 and 2008
 Net Income.
 Net Interest Income.
 Interest and Dividend Income.
  55




---



##### Table of Contents



Interest Expense.
   Provision for Loan Losses.
 Non-Interest Income.
 Non-Interest Expenses.
 Income Taxes.
 Comparison of Operating Results for the Years Ended June 30, 2008 and 2007
 Net Income.
 56




---



##### Table of Contents



Net Interest Income.
  Interest and Dividend Income.
   Interest Expense.
   Provision for Loan Losses.
 Non-Interest Income.
 57




---



##### Table of Contents



Non-Interest Expenses.
 Income Taxes.
 Management of Market Risk
 Qualitative Analysis.
    58




---



##### Table of Contents



Quantitative Analysis.
 Net Interest IncomeNet Portfolio Value(2)
    
    
    
    
    
    Increase (Decrease) inChange in
    
    
    
    
    
    Estimated Increase
    
    Estimated Net
    
    Estimated Net InterestInterest Rates
    
    Estimated
    
    (Decrease)
    
    Interest
    
    Income(basis points)(1)
    
    NPV
    
    Amount
    
    Percent
    
    Income(3)
    
    Amount
    
    Percent(Dollars in thousands)+ 200bp
    
    $
    681,159
    
    
    $
    (355,581
    )
    
    
    (34.3
    )%
    
    $
    238,609
    
    
    $
    (7,717
    )
    
    
    (3.1
    )%0bp
    
    $
    1,036,740
    
    
    
    
    
    
    
    
    
    
    $
    246,326
    
    
    
    
    
    
    
    -100bp
    
    $
    1,070,561
    
    
    $
    33,821
    
    
    
    3.3
    %
    
    $
    249,908
    
    
    $
    3,581
    
    
    
    1.5
    %
 
 (1)
    
    Assumes an instantaneous and parallel shift in interest rates at all maturities.(2)
    
    NPV is the discounted present value of expected cash flows from assets, liabilities
and off-balance sheet contracts.(3)
    
    Assumes a gradual change in interest rates over a one year period at all maturities.   Liquidity and Capital Resources
    59




---



##### Table of Contents



Business
 60




---



##### Table of Contents



Off-Balance Sheet Arrangements and Aggregate Contractual Obligations
 Off-Balance Sheet Arrangements.
 Contractual Obligations.
  Payments Due by PeriodLess than
    
    
    One to
    
    
    Three to
    
    
    More thanContractual Obligations
    
    One Year
    
    
    Three Years
    
    
    Five Years
    
    
    Five Years
    
    
    Total(In thousands)Other borrowed funds
    
    $
    105,000
    
    
    $
    455,542
    
    
    $
    240,000
    
    
    $
    150,000
    
    
    $
    950,542Repurchase agreements
    
    
    250,000
    
    
    
    445,000
    
    
    
    55,000
    
    
    
    
    
    
    
    750,000Operating leases
    
    
    5,392
    
    
    
    10,133
    
    
    
    8,533
    
    
    
    37,605
    
    
    
    61,663Total
    
    $
    360,392
    
    
    $
    910,675
    
    
    $
    303,533
    
    
    $
    187,605
    
    
    $
    1,762,205
 Recent Accounting Pronouncements
     61




---



##### Table of Contents



.
  Impact of Inflation and Changing Prices
  
 ITEM 6A. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
  
 ITEM 7. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
  
 ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
  
 ITEM 8A. CONTROLS AND PROCEDURES
      62




---



##### Table of Contents



Internal
Control-Integrated Framework
   
 ITEM 8B. OTHER INFORMATION
  63




---



##### Table of Contents



PART III
 
 ITEM 9. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
  
 ITEM 10. EXECUTIVE COMPENSATION
  
 ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
  
 ITEM 12. CERTAIN RELATIONSHIPS, RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE
  
 ITEM 13. PRINCIPAL ACCOUNTANT FEES AND SERVICES
  
 ITEM 14. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
 Financial Statements
 64




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##### Table of Contents



Report of Independent Registered Public Accounting Firm
 
      Internal Control  Integrated Framework
  
 65




---



##### Table of Contents



Report of Independent Registered Public Accounting Firm
 
 Internal
Control  Integrated Framework
    Internal Control  Integrated Framework
   
 66




---



##### Table of Contents



INVESTORS BANCORP, INC. AND SUBSIDIARIES
  December 31,
    
    
    June 30,2009
    
    
    2009
    
    
    2008(In thousands)ASSETSCash and cash equivalents
    
    $
    73,606
    
    
    
    317,757
    
    
    
    22,823Securities available-for-sale, at estimated fair value (notes 4 and 9)
    
    
    471,243
    
    
    
    355,016
    
    
    
    203,032Securities held-to-maturity, net (estimated fair value of $753,405, $861,302 and $1,198,053 at December 31, 2009, June 30, 2009 and
June 30, 2008, respectively) (notes 4 and 9)
    
    
    717,441
    
    
    
    846,043
    
    
    
    1,255,054Loans receivable, net (note 5)
    
    
    6,615,459
    
    
    
    6,143,169
    
    
    
    4,670,150Loans held-for-sale
    
    
    27,043
    
    
    
    61,691
    
    
    
    9,814Stock in the Federal Home Loan Bank
    
    
    66,202
    
    
    
    72,053
    
    
    
    60,935Accrued interest receivable (note 6)
    
    
    36,942
    
    
    
    37,291
    
    
    
    27,716Office properties and equipment, net (note 7)
    
    
    49,384
    
    
    
    44,142
    
    
    
    29,710Net deferred tax asset (note 10)
    
    
    117,143
    
    
    
    118,455
    
    
    
    40,702Bank owned life insurance (note 1)
    
    
    114,542
    
    
    
    113,191
    
    
    
    96,170Intangible assets
    
    
    31,668
    
    
    
    26,365
    
    
    
    922Other assets
    
    
    37,143
    
    
    
    1,259
    
    
    
    2,114$
    8,357,816
    
    
    
    8,136,432
    
    
    
    6,419,142LIABILITIES AND STOCKHOLDERS EQUITYLiabilities:Deposits (note 8)
    
    $
    5,840,643
    
    
    
    5,505,747
    
    
    
    3,970,275Borrowed funds (note 9)
    
    
    1,600,542
    
    
    
    1,730,555
    
    
    
    1,563,583Advance payments by borrowers for taxes and insurance
    
    
    29,675
    
    
    
    26,839
    
    
    
    21,829Other liabilities
    
    
    36,743
    
    
    
    54,008
    
    
    
    34,917Total liabilities
    
    
    7,507,603
    
    
    
    7,317,149
    
    
    
    5,590,604Commitments and contingencies (note 12)Stockholders equity (notes 3 and 15):Preferred stock, $0.01 par value, 50,000,000 authorized shares; none issued
    
    
    
    
    
    
    
    
    
    
    Common stock, $0.01 par value, 200,000,000 shares authorized; 118,020,280 issued; 114,448,888, 114,692,020 and 109,010,756
outstanding at December 31, 2009, June 30, 2009 and June 30, 2008, respectively
    
    
    532
    
    
    
    532
    
    
    
    532Additional paid-in capital
    
    
    530,133
    
    
    
    524,463
    
    
    
    514,613Retained earnings
    
    
    422,211
    
    
    
    399,672
    
    
    
    486,244Treasury stock, at cost; 3,571,392, 3,328,260 and 9,009,524 shares at December 31, 2009, June 30, 2009 and June 30, 2008, respectively
    
    
    (44,810
    )
    
    
    (42,447
    )
    
    
    (128,977
    )Unallocated common stock held by the employee stock ownership plan
    
    
    (35,451
    )
    
    
    (36,160
    )
    
    
    (37,578
    )Accumulated other comprehensive loss
    
    
    (22,402
    )
    
    
    (26,777
    )
    
    
    (6,296
    )Total stockholders equity
    
    
    850,213
    
    
    
    819,283
    
    
    
    828,538Total liabilities and stockholders equity
    
    $
    8,357,816
    
    
    
    8,136,432
    
    
    
    6,419,142
  67




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##### Table of Contents



INVESTORS BANCORP, INC. AND SUBSIDIARIES
  Six-Month Period EndedDecember 31,
    
    
    Years Ended June 30,2009
    
    
    2008
    
    
    2009
    
    
    2008
    
    
    2007(Unaudited)(In thousands, except per share data)Interest and dividend income:Loans receivable and loans held-for-sale
    
    $
    172,575
    
    
    
    148,771
    
    
    
    304,678
    
    
    
    229,634
    
    
    
    182,996Securities:Government-sponsored enterprise obligations
    
    
    453
    
    
    
    991
    
    
    
    1,587
    
    
    
    4,662
    
    
    
    5,851Mortgage-backed securities
    
    
    21,431
    
    
    
    26,273
    
    
    
    49,531
    
    
    
    62,919
    
    
    
    80,712Equity securities available-for-sale
    
    
    
    
    
    
    63
    
    
    
    64
    
    
    
    287
    
    
    
    1,786Municipal bonds and other debt
    
    
    1,446
    
    
    
    4,386
    
    
    
    8,703
    
    
    
    10,935
    
    
    
    9,967Interest-bearing deposits
    
    
    346
    
    
    
    39
    
    
    
    393
    
    
    
    974
    
    
    
    993Repurchase agreements
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    162
    
    
    
    Federal Home Loan Bank stock
    
    
    2,021
    
    
    
    1,424
    
    
    
    3,104
    
    
    
    3,234
    
    
    
    2,918Total interest and dividend income
    
    
    198,272
    
    
    
    181,947
    
    
    
    368,060
    
    
    
    312,807
    
    
    
    285,223Interest expense:Deposits (note 8)
    
    
    56,577
    
    
    
    62,937
    
    
    
    129,362
    
    
    
    152,745
    
    
    
    140,136Secured borrowings
    
    
    33,894
    
    
    
    37,362
    
    
    
    72,562
    
    
    
    54,950
    
    
    
    55,127Total interest expense
    
    
    90,471
    
    
    
    100,299
    
    
    
    201,924
    
    
    
    207,695
    
    
    
    195,263Net interest income
    
    
    107,801
    
    
    
    81,648
    
    
    
    166,136
    
    
    
    105,112
    
    
    
    89,960Provision for loan losses (note 5)
    
    
    23,425
    
    
    
    13,000
    
    
    
    29,025
    
    
    
    6,646
    
    
    
    729Net interest income after provision for loan losses
    
    
    84,376
    
    
    
    68,648
    
    
    
    137,111
    
    
    
    98,466
    
    
    
    89,231Non-interest income (loss):Fees and service charges
    
    
    2,938
    
    
    
    1,452
    
    
    
    3,174
    
    
    
    3,022
    
    
    
    2,762Income on bank owned life insurance (note 1)
    
    
    1,301
    
    
    
    1,984
    
    
    
    2,910
    
    
    
    3,972
    
    
    
    3,749Gain on sales of mortgage loans, net
    
    
    4,454
    
    
    
    66
    
    
    
    4,343
    
    
    
    605
    
    
    
    244Loss on securities, net (note 4) (a)
    
    
    (112
    )
    
    
    (157,971
    )
    
    
    (159,266
    )
    
    
    (682
    )
    
    
    (3,790
    )Other income
    
    
    426
    
    
    
    211
    
    
    
    409
    
    
    
    456
    
    
    
    210Total non-interest income (loss)
    
    
    9,007
    
    
    
    (154,258
    )
    
    
    (148,430
    )
    
    
    7,373
    
    
    
    3,175Non-interest expenses:Compensation and benefits (note 11)
    
    
    32,713
    
    
    
    29,743
    
    
    
    60,085
    
    
    
    53,886
    
    
    
    51,221Advertising and promotional expense
    
    
    1,860
    
    
    
    1,760
    
    
    
    3,635
    
    
    
    2,736
    
    
    
    3,310Office occupancy and equipment expense (notes 7 and
12)
    
    
    7,778
    
    
    
    5,542
    
    
    
    11,664
    
    
    
    10,888
    
    
    
    10,470Federal deposit insurance premiums
    
    
    4,815
    
    
    
    1,357
    
    
    
    8,557
    
    
    
    445
    
    
    
    451Stationery, printing, supplies and telephone
    
    
    1,369
    
    
    
    1,035
    
    
    
    2,088
    
    
    
    1,869
    
    
    
    1,688Professional fees
    
    
    1,861
    
    
    
    1,190
    
    
    
    2,319
    
    
    
    2,008
    
    
    
    2,094Data processing service fees
    
    
    2,729
    
    
    
    2,235
    
    
    
    4,588
    
    
    
    4,730
    
    
    
    4,315Other operating expenses
    
    
    3,375
    
    
    
    2,319
    
    
    
    4,863
    
    
    
    4,218
    
    
    
    4,068Total non-interest expenses
    
    
    56,500
    
    
    
    45,181
    
    
    
    97,799
    
    
    
    80,780
    
    
    
    77,617Income (loss) before income tax expense (benefit).
    
    
    36,883
    
    
    
    (130,791
    )
    
    
    (109,118
    )
    
    
    25,059
    
    
    
    14,789Income tax expense (benefit) (note 10)
    
    
    14,321
    
    
    
    (53,323
    )
    
    
    (44,200
    )
    
    
    9,030
    
    
    
    (7,477
    )Net income (loss)
    
    $
    22,562
    
    
    
    (77,468
    )
    
    
    (64,918
    )
    
    
    16,029
    
    
    
    22,266Basic and diluted earnings (loss) per share
    
    $
    0.21
    
    
    
    (0.75
    )
    
    
    (0.62
    )
    
    
    0.15
    
    
    
    0.20Weighted average shares outstanding (note 18)Basic
    
    
    109,862,617
    
    
    
    103,872,522
    
    
    
    104,530,402
    
    
    
    105,447,910
    
    
    
    111,730,234Diluted
    
    
    109,989,048
    
    
    
    103,872,522
    
    
    
    104,530,402
    
    
    
    105,601,764
    
    
    
    112,012,064
 
 (a)
    
    Loss on securities of $35.7 million in fiscal year ended June 30, 2009
and the six-month period ended December 31, 2008 was determined to be a non-credit related OTTI charge upon the adoption of ASC 320. For the six-month period ended December 31, 2009,
 a $1.1 million non-credit related loss is
reflected in accumulated other comprehensive income.  68




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##### Table of Contents



INVESTORS BANCORP, INC. AND SUBSIDIARIES
 
 UnallocatedCommon
    
    
    AccumulatedAdditional
    
    
    
    
    
    
    
    
    
    
    Stock
    
    
    Other
    
    
    TotalCommon
    
    
    Paid-in
    
    
    Retained
    
    
    Treasury
    
    
    Held by
    
    
    Comprehensive
    
    
    StockholdersStock
    
    
    Capital
    
    
    Earnings
    
    
    Stock
    
    
    ESOP
    
    
    Loss
    
    
    Equity(In thousands)Balance at June 30, 2006
    
    $
    532
    
    
    
    524,972
    
    
    
    442,687
    
    
    
    
    
    
    
    (40,414
    )
    
    
    (11,486
    )
    
    
    916,291Comprehensive income:Net income
    
    
    
    
    
    
    
    
    
    
    22,266
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    22,266Change in minimum pension liability, net of tax
expense of $245
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    368
    
    
    
    368Unrealized gain on securities
available-for-sale, net of tax expense of $3,273
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,068
    
    
    
    5,068Reclassification adjustment for losses included
in net income, net of tax benefit of $1,347
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,075
    
    
    
    2,075Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    29,777Cumulative effect of change in accounting for
bank owned life insurance
    
    
    
    
    
    
    
    
    
    
    5,564
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,564Purchase of treasury stock (6,473,695 shares)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (96,706
    )
    
    
    
    
    
    
    
    
    
    
    (96,706
    )Treasury stock allocated to restricted stock plan
    
    
    
    
    
    
    (25,421
    )
    
    
    (312
    )
    
    
    25,733
    
    
    
    
    
    
    
    
    
    
    
    Funded status of postretirement plans upon
adoption of ASC 715, net of tax benefit of
$2,638
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3,960
    )
    
    
    (3,960
    )Compensation cost for stock options and
restricted stock
    
    
    
    
    
    
    5,821
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,821ESOP shares allocated or committed to be released
    
    
    
    
    
    
    654
    
    
    
    
    
    
    
    
    
    
    
    1,418
    
    
    
    
    
    
    
    2,072Balance at June 30, 2007
    
    $
    532
    
    
    
    506,026
    
    
    
    470,205
    
    
    
    (70,973
    )
    
    
    (38,996
    )
    
    
    (7,935
    )
    
    
    858,859Comprehensive income:Net income
    
    
    
    
    
    
    
    
    
    
    16,029
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    16,029Change in funded status of postretirement plan
due to plan curtailment and settlement, net of
tax expense of $891
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,337
    
    
    
    1,337Change in funded status of retirement
obligations, net of tax benefit of $107
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (169
    )
    
    
    (169
    )Unrealized loss on securities
available-for-sale, net of tax expense of $260
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (208
    )
    
    
    (208
    )Reclassification adjustment for losses included
in net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    679
    
    
    
    679Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    17,668Cumulative effect adjustment upon adoption of
FIN 48
    
    
    
    
    
    
    
    
    
    
    300
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    300Purchase of treasury stock (4,339,530 shares)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (60,124
    )
    
    
    
    
    
    
    
    
    
    
    (60,124
    )Treasury stock allocated to restricted stock plan
    
    
    
    
    
    
    (1,830
    )
    
    
    (290
    )
    
    
    2,120
    
    
    
    
    
    
    
    
    
    
    
    Compensation cost for stock options and
restricted stock
    
    
    
    
    
    
    9,814
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    9,814ESOP shares allocated or committed to be released
    
    
    
    
    
    
    603
    
    
    
    
    
    
    
    
    
    
    
    1,418
    
    
    
    
    
    
    
    2,021Balance at June 30, 2008
    
    $
    532
    
    
    
    514,613
    
    
    
    486,244
    
    
    
    (128,977
    )
    
    
    (37,578
    )
    
    
    (6,296
    )
    
    
    828,538Comprehensive income:Net loss
    
    
    
    
    
    
    
    
    
    
    (64,918
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (64,918
    )Change in funded status of retirement
obligations, net of tax benefit of $431
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (638
    )
    
    
    (638
    )Unrealized gain on securities
available-for-sale, net of tax expense of $728
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    808
    
    
    
    808Reclassification adjustment for losses included
in net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    457
    
    
    
    457
 69




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##### Table of Contents



UnallocatedCommon
    
    
    AccumulatedAdditional
    
    
    
    
    
    
    
    
    
    
    Stock
    
    
    Other
    
    
    TotalCommon
    
    
    Paid-in
    
    
    Retained
    
    
    Treasury
    
    
    Held by
    
    
    Comprehensive
    
    
    StockholdersStock
    
    
    Capital
    
    
    Earnings
    
    
    Stock
    
    
    ESOP
    
    
    Loss
    
    
    Equity(In thousands)Total comprehensive loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (64,291
    )Cumulative effect of initial application of ASC
320 on other-than-temporary-impairment net of
tax benefit of $14,577
    
    
    
    
    
    
    
    
    
    
    21,108
    
    
    
    
    
    
    
    
    
    
    
    (21,108
    )
    
    
    Common stock issued out of treasury stock to
finance acquisition (6,503,897 shares)
    
    
    
    
    
    
    
    
    
    
    (42,520
    )
    
    
    93,250
    
    
    
    
    
    
    
    
    
    
    
    50,730Purchase of treasury stock (947,633 shares)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (8,673
    )
    
    
    
    
    
    
    
    
    
    
    (8,673
    )Treasury stock allocated to restricted stock plan
    
    
    
    
    
    
    (1,711
    )
    
    
    (242
    )
    
    
    1,953
    
    
    
    
    
    
    
    
    
    
    
    Compensation cost for stock options and
restricted stock
    
    
    
    
    
    
    11,330
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    11,330ESOP shares allocated or committed to be released
    
    
    
    
    
    
    231
    
    
    
    
    
    
    
    
    
    
    
    1,418
    
    
    
    
    
    
    
    1,649Balance at June 30, 2009
    
    $
    532
    
    
    
    524,463
    
    
    
    399,672
    
    
    
    (42,447
    )
    
    
    (36,160
    )
    
    
    (26,777
    )
    
    
    819,283Comprehensive income:Net income
    
    
    
    
    
    
    
    
    
    
    22,562
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    22,562Change in funded status of retirement
obligations, net of tax expense of $645
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    969
    
    
    
    969Unrealized gain on securities
available-for-sale, net of tax expense of $1,875
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,917
    
    
    
    2,917Reclassification adjustment for losses included
in net income, net of tax expense of $37
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    54
    
    
    
    54Other-than-temporary impairment accretion on
debt securities, net of tax expense of $300
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    435
    
    
    
    435Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    26,937Purchase of treasury stock (248,132 shares)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,436
    )
    
    
    
    
    
    
    
    
    
    
    (2,436
    )Treasury stock allocated to restricted stock plan
    
    
    
    
    
    
    (50
    )
    
    
    (23
    )
    
    
    73
    
    
    
    
    
    
    
    
    
    
    
    Compensation cost for stock options and
restricted stock
    
    
    
    
    
    
    5,708
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,708ESOP shares allocated or committed to be released
    
    
    
    
    
    
    12
    
    
    
    
    
    
    
    
    
    
    
    709
    
    
    
    
    
    
    
    721Balance at December 31, 2009
    
    $
    532
    
    
    
    530,133
    
    
    
    422,211
    
    
    
    (44,810
    )
    
    
    (35,451
    )
    
    
    (22,402
    )
    
    
    850,213
  70




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##### Table of Contents



INVESTORS BANCORP, INC. AND SUBSIDIARIES
  Six-Month Period EndedDecember 31,
    
    
    Years Ended June 30,2009
    
    
    2008
    
    
    2009
    
    
    2008
    
    
    2007(Unaudited)(In thousands)Cash flows from operating activities:Net income (loss)
    
    $
    22,562
    
    
    
    (77,468
    )
    
    $
    (64,918
    )
    
    
    16,029
    
    
    
    22,266Adjustments to reconcile net income to net cash provided
by operating activities:ESOP and stock-based compensation expense
    
    
    6,429
    
    
    
    6,264
    
    
    
    12,979
    
    
    
    11,835
    
    
    
    7,893Accretion of discounts and amortization of premiums on
securities, net
    
    
    3,242
    
    
    
    258
    
    
    
    (520
    )
    
    
    993
    
    
    
    1,552Amortization of premiums and accretion of fees and costs
on loans, net
    
    
    3,564
    
    
    
    1,249
    
    
    
    6,599
    
    
    
    2,389
    
    
    
    1,881Amortization of intangible assets
    
    
    366
    
    
    
    
    
    
    
    70
    
    
    
    
    
    
    
    Provision for loan losses
    
    
    23,425
    
    
    
    13,000
    
    
    
    29,025
    
    
    
    6,646
    
    
    
    729Depreciation and amortization of office properties and
equipment
    
    
    1,980
    
    
    
    1,005
    
    
    
    2,725
    
    
    
    2,760
    
    
    
    2,937Loss on securities, net
    
    
    21
    
    
    
    157,971
    
    
    
    159,266
    
    
    
    682
    
    
    
    3,790Other-than-temporary impairment losses on securities
    
    
    91
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Mortgage loans originated for sale
    
    
    (288,647
    )
    
    
    (203,728
    )
    
    
    (753,264
    )
    
    
    (139,487
    )
    
    
    (41,887
    )Proceeds from mortgage loan sales
    
    
    325,928
    
    
    
    196,673
    
    
    
    712,295
    
    
    
    133,688
    
    
    
    39,934Gain on sales of mortgage loans, net
    
    
    (2,633
    )
    
    
    (66
    )
    
    
    (4,343
    )
    
    
    (605
    )
    
    
    (244
    )Gain on sale of REO
    
    
    (38
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Income on bank owned life insurance
    
    
    (1,301
    )
    
    
    (1,984
    )
    
    
    (2,910
    )
    
    
    (3,972
    )
    
    
    (3,749
    )Decrease (increase) in accrued interest receivable
    
    
    349
    
    
    
    (5,215
    )
    
    
    (7,123
    )
    
    
    (2,898
    )
    
    
    (3,247
    )Deferred tax benefit
    
    
    1,595
    
    
    
    (66,203
    )
    
    
    (65,275
    )
    
    
    (1,602
    )
    
    
    (14,016
    )(Increase) decrease in other assets
    
    
    (36,604
    )
    
    
    251
    
    
    
    242
    
    
    
    (1,742
    )
    
    
    (236
    )(Decrease) increase in other liabilities
    
    
    (19,394
    )
    
    
    6,485
    
    
    
    14,232
    
    
    
    (1,038
    )
    
    
    (1,580
    )Total adjustments
    
    
    18,373
    
    
    
    105,960
    
    
    
    103,998
    
    
    
    7,649
    
    
    
    (6,243
    )Net cash provided by operating activities
    
    
    40,935
    
    
    
    28,492
    
    
    
    39,080
    
    
    
    23,678
    
    
    
    16,023Cash flows from investing activities:Purchases of loans receivable
    
    
    (452,295
    )
    
    
    (822,110
    )
    
    
    (1,264,804
    )
    
    
    (996,320
    )
    
    
    (665,166
    )Net (originations) repayments of loans receivable
    
    
    (66,342
    )
    
    
    (140,174
    )
    
    
    226,936
    
    
    
    (58,005
    )
    
    
    32,788Net proceeds from sale of foreclosed real estate
    
    
    106
    
    
    
    
    
    
    
    
    
    
    
    138
    
    
    
    Proceeds from sale of non performing loan
    
    
    21,178
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Gain on sale of loan
    
    
    (1,820
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Mortgage-backed securities available-for-sale received in
like-kind exchange
    
    
    
    
    
    
    (3,911
    )
    
    
    
    
    
    
    
    
    
    
    Purchases of mortgage-backed securities held-to-maturity
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (22,696
    )Purchases of debt securities held-to-maturity
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (23,118
    )
    
    
    (46,362
    )Purchases of mortgage-backed securities available for sale
    
    
    (179,756
    )
    
    
    
    
    
    
    (104,186
    )
    
    
    
    
    
    
    Purchases of other investments available-for-sale
    
    
    (250
    )
    
    
    (100
    )
    
    
    (100
    )
    
    
    (1,400
    )
    
    
    Proceeds from paydowns/maturities on mortgage-backed
securities held-to-maturity
    
    
    125,721
    
    
    
    95,436
    
    
    
    221,680
    
    
    
    247,018
    
    
    
    290,649Proceeds from calls/maturities on debt securities
held-to-maturity
    
    
    2,660
    
    
    
    19,612
    
    
    
    19,553
    
    
    
    98,876
    
    
    
    10,137Proceeds from paydowns/maturities on mortgage-backed
securities available-for-sale
    
    
    61,110
    
    
    
    20,797
    
    
    
    56,345
    
    
    
    56,205
    
    
    
    89,170Proceeds from sales of mortgage-backed securities
held-to-maturity
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    22,942Proceeds from sales of mortgage-backed securities
available-for-sale
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    161,112Proceeds from maturities of US Government and Agency
Obligations available-for-sale
    
    
    5,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Purchase of US Government and Agency Obligations held to
maturity
    
    
    
    
    
    
    
    
    
    
    (109,997
    )
    
    
    
    
    
    
    Proceeds from maturities of US Government and Agency
Obligations held to maturity
    
    
    155
    
    
    
    
    
    
    
    120,120
    
    
    
    
    
    
    
    
 71




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##### Table of Contents



Six-Month Period EndedDecember 31,
    
    
    Years Ended June 30,2009
    
    
    2008
    
    
    2009
    
    
    2008
    
    
    2007(Unaudited)(In thousands)Redemption of equity securities available-for-sale
    
    
    
    
    
    
    4,774
    
    
    
    863
    
    
    
    
    
    
    
    Proceeds from sales of equity securities available-for-sale
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    250
    
    
    
    3,681Proceeds from call of equity securities available-for-sale
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    35,000Proceeds from redemptions of Federal Home Loan Bank stock
    
    
    10,756
    
    
    
    30,578
    
    
    
    53,349
    
    
    
    35,208
    
    
    
    48,908Purchases of Federal Home Loan Bank stock
    
    
    (4,905
    )
    
    
    (56,228
    )
    
    
    (61,950
    )
    
    
    (62,074
    )
    
    
    (36,651
    )Purchases of office properties and equipment
    
    
    (5,122
    )
    
    
    (4,805
    )
    
    
    (9,055
    )
    
    
    (3,818
    )
    
    
    (2,098
    )Purchase of bank owned life insurance
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (282
    )Cash consideration paid for acquisitions, net of cash
received
    
    
    220,944
    
    
    
    
    
    
    
    (4,225
    )
    
    
    
    
    
    
    Net cash used in investing activities
    
    
    (262,860
    )
    
    
    (856,131
    )
    
    
    (855,471
    )
    
    
    (707,040
    )
    
    
    (78,868
    )Cash flows from financing activities:Net increase in deposits
    
    
    107,387
    
    
    
    262,363
    
    
    
    1,017,256
    
    
    
    202,087
    
    
    
    348,827Net (decrease) increase in funds borrowed under short-term
repurchase agreements
    
    
    
    
    
    
    (25,000
    )
    
    
    (25,000
    )
    
    
    (135,000
    )
    
    
    (165,000
    )Proceeds from funds borrowed under other repurchase
agreements
    
    
    
    
    
    
    55,000
    
    
    
    90,000
    
    
    
    640,000
    
    
    
    360,000Repayments of funds borrowed under other repurchase
agreements
    
    
    (110,000
    )
    
    
    (120,000
    )
    
    
    (205,000
    )
    
    
    (210,000
    )
    
    
    (585,000
    )Net (decrease) increase in other borrowings
    
    
    (20,013
    )
    
    
    659,986
    
    
    
    235,249
    
    
    
    229,873
    
    
    
    182,970Net increase in advance payments by borrowers for taxes
and insurance
    
    
    2,836
    
    
    
    256
    
    
    
    3,299
    
    
    
    3,767
    
    
    
    2,354Purchase of treasury stock
    
    
    (2,436
    )
    
    
    (1,097
    )
    
    
    (4,479
    )
    
    
    (60,124
    )
    
    
    (96,706
    )Net cash (used in) provided by financing activities
    
    
    (22,226
    )
    
    
    831,508
    
    
    
    1,111,325
    
    
    
    670,603
    
    
    
    47,445Net (decrease) increase in cash and cash equivalents
    
    
    (244,151
    )
    
    
    3,869
    
    
    
    294,934
    
    
    
    (12,759
    )
    
    
    (15,400
    )Cash and cash equivalents at beginning of year
    
    
    317,757
    
    
    
    22,823
    
    
    
    22,823
    
    
    
    35,582
    
    
    
    50,982Cash and cash equivalents at end of year
    
    $
    73,606
    
    
    
    26,692
    
    
    
    317,757
    
    
    
    22,823
    
    
    
    35,582Supplemental cash flow information:Noncash investing activities:Real estate acquired through foreclosure
    
    $
    68
    
    
    
    
    
    
    
    
    
    
    
    138
    
    
    
    Cash paid during the year for:Interest
    
    $
    91,055
    
    
    
    98,126
    
    
    
    201,081
    
    
    
    205,660
    
    
    
    196,170Income taxes
    
    $
    14,574
    
    
    
    8,815
    
    
    
    22,989
    
    
    
    9,217
    
    
    
    9,662Fair value of assets acquired
    
    $
    2,230
    
    
    
    
    
    
    
    628,847
    
    
    
    
    
    
    
    Goodwill and core deposit intangible
    
    $
    4,850
    
    
    
    
    
    
    
    21,549
    
    
    
    
    
    
    
    Liabilities assumed
    
    $
    228,024
    
    
    
    
    
    
    
    595,440
    
    
    
    
    
    
    
    Common stock issued for American Bancorp of NJ acquisition
    
    $
    
    
    
    
    
    
    
    
    50,730
    
    
    
    
    
    
    
    
  72




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##### Table of Contents



INVESTORS BANCORP, INC. AND SUBSIDIARIES
 
 (1) Summary of Significant Accounting Policies
  (a) Basis of Presentation
     Business
   (b) Cash Equivalents
  (c) Securities
  73




---



##### Table of Contents



(d) Loans Receivable, Net
     (e) Loans Held-for-Sale
  74




---



##### Table of Contents



(f) Federal Home Loan Bank Stock
  (g) Office Properties and Equipment, Net
  (h) Bank Owned Life Insurance
  (i) Intangible Assets
 Goodwill .
 Mortgage Servicing Rights .
 Core Deposit Premiums .
 75




---



##### Table of Contents



(j) Real Estate Owned
  (k) Borrowed Funds
   (l) Income Taxes
  (m) Employee Benefits
      76




---



##### Table of Contents



(n) Earnings Per Share
   (2) Business Combinations
    77




---



##### Table of Contents



(3) Stock Transactions
 Stock Offering
  Stock Repurchase Programs
  78




---



##### Table of Contents



(4) Securities
  At December 31, 2009Gross
    
    
    GrossAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    EstimatedCost
    
    
    Gains
    
    
    Losses
    
    
    Fair Value(In thousands)Available-for-saleEquity securities
    
    $
    1,832
    
    
    
    221
    
    
    
    
    
    
    
    2,053GSE debt securities
    
    
    25,013
    
    
    
    26
    
    
    
    
    
    
    
    25,039Mortgage-backed securities:Federal Home Loan Mortgage Corporation
    
    
    206,877
    
    
    
    2,725
    
    
    
    80
    
    
    
    209,522Federal National Mortgage Association
    
    
    158,678
    
    
    
    2,197
    
    
    
    448
    
    
    
    160,427Government National Mortgage Association
    
    
    10,504
    
    
    
    25
    
    
    
    79
    
    
    
    10,450Non-agency securities
    
    
    67,290
    
    
    
    284
    
    
    
    3,822
    
    
    
    63,752Total mortgage-backed securities
available for sale
    
    
    443,349
    
    
    
    5,231
    
    
    
    4,429
    
    
    
    444,151Total securities available-for-sale
    
    $
    470,194
    
    
    
    5,478
    
    
    
    4,429
    
    
    
    471,243Held-to-maturityDebt securities:Government Sponsored Enterprises
    
    $
    15,226
    
    
    
    731
    
    
    
    1
    
    
    
    15,956Municipal bonds
    
    
    10,259
    
    
    
    196
    
    
    
    4
    
    
    
    10,451Corporate and other debt securities
    
    
    21,411
    
    
    
    18,015
    
    
    
    1,617
    
    
    
    37,80946,896
    
    
    
    18,942
    
    
    
    1,622
    
    
    
    64,216Mortgage-backed securities:Federal Home Loan Mortgage Corporation
    
    
    358,998
    
    
    
    10,565
    
    
    
    159
    
    
    
    369,404Government National Mortgage Association
    
    
    3,880
    
    
    
    277
    
    
    
    
    
    
    
    4,157Federal National Mortgage Association
    
    
    236,109
    
    
    
    9,268
    
    
    
    24
    
    
    
    245,353Federal housing authorities
    
    
    2,549
    
    
    
    231
    
    
    
    
    
    
    
    2,780Non-agency securities
    
    
    69,009
    
    
    
    47
    
    
    
    1,561
    
    
    
    67,495Total mortgage-backed securities
held-to-maturity
    
    
    670,545
    
    
    
    20,388
    
    
    
    1,744
    
    
    
    689,189Total securities held-to-maturity
    
    $
    717,441
    
    
    
    39,330
    
    
    
    3,366
    
    
    
    753,405Total securities
    
    $
    1,187,635
    
    
    
    44,808
    
    
    
    7,795
    
    
    
    1,224,648
 79




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##### Table of Contents



At June 30, 2009Amortized
    
    
    Gross Unrealized
    
    
    Gross Unrealized
    
    
    EstimatedCost
    
    
    Gains
    
    
    Losses
    
    
    Fair Value(In thousands)Available-for-saleEquity securities
    
    $
    1,583
    
    
    
    15
    
    
    
    
    
    
    
    1,598GSE debt securities
    
    
    30,051
    
    
    
    28
    
    
    
    
    
    
    
    30,079Mortgage-backed securities:Federal Home Loan Mortgage Corporation
    
    
    151,450
    
    
    
    1,276
    
    
    
    8
    
    
    
    152,718Federal National Mortgage Association
    
    
    94,967
    
    
    
    1,661
    
    
    
    11
    
    
    
    96,617Government National Mortgage Association
    
    
    275
    
    
    
    25
    
    
    
    
    
    
    
    300Non-agency securities
    
    
    80,523
    
    
    
    137
    
    
    
    6,956
    
    
    
    73,704Total mortgage-backed securities
available for sale
    
    
    327,215
    
    
    
    3,099
    
    
    
    6,975
    
    
    
    323,339Total securities available-for-sale
    
    $
    358,849
    
    
    
    3,142
    
    
    
    6,975
    
    
    
    355,016Held-to-maturityDebt securities:Government Sponsored Enterprises
    
    $
    18,238
    
    
    
    924
    
    
    
    1
    
    
    
    19,161Municipal bonds
    
    
    10,420
    
    
    
    211
    
    
    
    7
    
    
    
    10,624Corporate and other debt securities
    
    
    20,727
    
    
    
    2,332
    
    
    
    2,930
    
    
    
    20,12949,385
    
    
    
    3,467
    
    
    
    2,938
    
    
    
    49,914Mortgage-backed securities:Federal Home Loan Mortgage Corporation
    
    
    429,969
    
    
    
    10,426
    
    
    
    307
    
    
    
    440,088Federal National Mortgage Association
    
    
    278,272
    
    
    
    8,682
    
    
    
    134
    
    
    
    286,820Government National Mortgage Association
    
    
    4,269
    
    
    
    348
    
    
    
    
    
    
    
    4,617Federal housing authorities
    
    
    2,654
    
    
    
    254
    
    
    
    
    
    
    
    2,908Non-agency securities
    
    
    81,494
    
    
    
    
    
    
    
    4,539
    
    
    
    76,955Total mortgage-backed securities
held-to-maturity
    
    
    796,658
    
    
    
    19,710
    
    
    
    4,980
    
    
    
    811,388Total securities held-to-maturity
    
    $
    846,043
    
    
    
    23,177
    
    
    
    7,918
    
    
    
    861,302Total securities
    
    $
    1,204,892
    
    
    
    26,319
    
    
    
    14,893
    
    
    
    1,216,318
 80




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##### Table of Contents



At June 30, 2008Amortized
    
    
    Gross Unrealized
    
    
    Gross Unrealized
    
    
    EstimatedCost
    
    
    Gains
    
    
    Losses
    
    
    Fair Value(In thousands)Available-for-saleEquity securities
    
    $
    6,655
    
    
    
    
    
    
    
    141
    
    
    
    6,514GSE debt securities
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Mortgage-backed securities:Federal Home Loan Mortgage Corporation
    
    
    51,256
    
    
    
    182
    
    
    
    241
    
    
    
    51,197Federal National Mortgage Association
    
    
    49,393
    
    
    
    174
    
    
    
    203
    
    
    
    49,364Government National Mortgage Association
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Non-agency securities
    
    
    101,555
    
    
    
    6
    
    
    
    5,604
    
    
    
    95,957Total mortgage-backed securities
available for sale
    
    
    202,204
    
    
    
    362
    
    
    
    6,048
    
    
    
    196,518Total securities available-for-sale
    
    $
    208,859
    
    
    
    362
    
    
    
    6,189
    
    
    
    203,032Held-to-maturityDebt securities:Government Sponsored Enterprises
    
    $
    46,703
    
    
    
    443
    
    
    
    94
    
    
    
    47,052Municipal bonds
    
    
    10,574
    
    
    
    212
    
    
    
    13
    
    
    
    10,773Corporate and other debt securities
    
    
    178,669
    
    
    
    
    
    
    
    43,142
    
    
    
    135,527235,946
    
    
    
    655
    
    
    
    43,249
    
    
    
    193,352Mortgage-backed securities:Federal Home Loan Mortgage Corporation
    
    
    551,708
    
    
    
    1,307
    
    
    
    8,181
    
    
    
    544,834Federal National Mortgage Association
    
    
    354,493
    
    
    
    1,139
    
    
    
    4,629
    
    
    
    351,003Government National Mortgage Association
    
    
    5,052
    
    
    
    270
    
    
    
    
    
    
    
    5,322Federal housing authorities
    
    
    2,849
    
    
    
    228
    
    
    
    
    
    
    
    3,077Non-agency securities
    
    
    105,006
    
    
    
    
    
    
    
    4,541
    
    
    
    100,465Total mortgage-backed securities
held-to-maturity
    
    
    1,019,108
    
    
    
    2,944
    
    
    
    17,351
    
    
    
    1,004,701Total securities held-to-maturity
    
    $
    1,255,054
    
    
    
    3,599
    
    
    
    60,600
    
    
    
    1,198,053Total securities
    
    $
    1,463,913
    
    
    
    3,961
    
    
    
    66,789
    
    
    
    1,401,085
 81




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##### Table of Contents



December 31, 2009Less than 12 Months
    
    
    12 Months or More
    
    
    TotalEstimated
    
    
    Unrealized
    
    
    Estimated
    
    
    Unrealized
    
    
    Estimated
    
    
    UnrealizedFair Value
    
    
    Losses
    
    
    Fair Value
    
    
    Losses
    
    
    Fair Value
    
    
    Losses(In thousands)Available-for-sale:Mortgage-backed securities:Federal Home Loan Mortgage Corporation
    
    $
    33,595
    
    
    
    80
    
    
    
    
    
    
    
    
    
    
    
    33,595
    
    
    
    80Federal National Mortgage Association
    
    
    63,527
    
    
    
    446
    
    
    
    16
    
    
    
    2
    
    
    
    63,543
    
    
    
    448Government National Mortgage Association
    
    
    10,168
    
    
    
    79
    
    
    
    
    
    
    
    
    
    
    
    10,168
    
    
    
    79Non-agency securities
    
    
    4,563
    
    
    
    370
    
    
    
    26,736
    
    
    
    3,452
    
    
    
    31,299
    
    
    
    3,822Total available-for sale
    
    
    111,853
    
    
    
    975
    
    
    
    26,752
    
    
    
    3,454
    
    
    
    138,605
    
    
    
    4,429Held-to-maturity:Debt securities:Government-sponsored enterprises
    
    
    
    
    
    
    
    
    
    
    225
    
    
    
    1
    
    
    
    225
    
    
    
    1Municipal bonds
    
    
    
    
    
    
    
    
    
    
    1,035
    
    
    
    4
    
    
    
    1,035
    
    
    
    4Corporate and other debt securities
    
    
    1,024
    
    
    
    1,617
    
    
    
    
    
    
    
    
    
    
    
    1,024
    
    
    
    1,6171,024
    
    
    
    1,617
    
    
    
    1,260
    
    
    
    5
    
    
    
    2,284
    
    
    
    1,622Mortgage-backed securities:Federal Home Loan Mortgage Corporation
    
    
    5,860
    
    
    
    159
    
    
    
    
    
    
    
    
    
    
    
    5,860
    
    
    
    159Federal National Mortgage Association
    
    
    2,699
    
    
    
    5
    
    
    
    5,392
    
    
    
    19
    
    
    
    8,091
    
    
    
    24Non-agency securities
    
    
    16,352
    
    
    
    257
    
    
    
    42,308
    
    
    
    1,304
    
    
    
    58,660
    
    
    
    1,56124,911
    
    
    
    421
    
    
    
    47,700
    
    
    
    1,323
    
    
    
    72,611
    
    
    
    1,744Total held-to-maturity
    
    
    25,935
    
    
    
    2,038
    
    
    
    48,960
    
    
    
    1,328
    
    
    
    74,895
    
    
    
    3,366Total
    
    $
    137,788
    
    
    
    3,013
    
    
    
    75,712
    
    
    
    4,782
    
    
    
    213,500
    
    
    
    7,795
 82




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##### Table of Contents



June 30, 2009Less than 12 Months
    
    
    12 Months or More
    
    
    TotalEstimated
    
    
    Unrealized
    
    
    Estimated
    
    
    Unrealized
    
    
    Estimated
    
    
    UnrealizedFair Value
    
    
    Losses
    
    
    Fair Value
    
    
    Losses
    
    
    Fair Value
    
    
    Losses(In thousands)Available-for-sale:Mortgage-backed securities:Federal Home Loan Mortgage Corporation
    
    $
    947
    
    
    
    8
    
    
    
    
    
    
    
    
    
    
    
    947
    
    
    
    8Federal National Mortgage Association
    
    
    8,587
    
    
    
    11
    
    
    
    
    
    
    
    
    
    
    
    8,587
    
    
    
    11Non-agency securities
    
    
    359
    
    
    
    109
    
    
    
    67,149
    
    
    
    6,847
    
    
    
    67,508
    
    
    
    6,956Total available-for sale
    
    
    9,893
    
    
    
    128
    
    
    
    67,149
    
    
    
    6,847
    
    
    
    77,042
    
    
    
    6,975Held-to-maturity:Debt securities:Government-sponsored enterprises
    
    
    237
    
    
    
    1
    
    
    
    
    
    
    
    
    
    
    
    237
    
    
    
    1Municipal bonds
    
    
    
    
    
    
    
    
    
    
    1,193
    
    
    
    7
    
    
    
    1,193
    
    
    
    7Corporate and other debt securities
    
    
    9,238
    
    
    
    2,930
    
    
    
    
    
    
    
    
    
    
    
    9,238
    
    
    
    2,9309,475
    
    
    
    2,931
    
    
    
    1,193
    
    
    
    7
    
    
    
    10,668
    
    
    
    2,938Mortgage-backed securities:Federal Home Loan Mortgage Corporation
    
    
    19,968
    
    
    
    171
    
    
    
    7,980
    
    
    
    136
    
    
    
    27,948
    
    
    
    307Federal National Mortgage Association
    
    
    14,170
    
    
    
    28
    
    
    
    13,841
    
    
    
    106
    
    
    
    28,011
    
    
    
    134Non-agency securities
    
    
    
    
    
    
    
    
    
    
    76,955
    
    
    
    4,539
    
    
    
    76,955
    
    
    
    4,53934,138
    
    
    
    199
    
    
    
    98,776
    
    
    
    4,781
    
    
    
    132,914
    
    
    
    4,980Total held-to-maturity
    
    
    43,613
    
    
    
    3,130
    
    
    
    99,969
    
    
    
    4,788
    
    
    
    143,582
    
    
    
    7,918Total
    
    $
    53,506
    
    
    
    3,258
    
    
    
    167,118
    
    
    
    11,635
    
    
    
    220,624
    
    
    
    14,893
 June 30, 2008Less than 12 Months
    
    
    12 Months or More
    
    
    TotalEstimated
    
    
    Unrealized
    
    
    Estimated
    
    
    Unrealized
    
    
    Estimated
    
    
    UnrealizedFair Value
    
    
    Losses
    
    
    Fair Value
    
    
    Losses
    
    
    Fair Value
    
    
    Losses(In thousands)Available-for-sale:Equity securities
    
    $
    1,238
    
    
    
    141
    
    
    
    
    
    
    
    
    
    
    
    1,238
    
    
    
    141Mortgage-backed securities:Federal Home Loan Mortgage Corporation
    
    
    24,517
    
    
    
    241
    
    
    
    
    
    
    
    
    
    
    
    24,517
    
    
    
    241Federal National Mortgage Association
    
    
    25,622
    
    
    
    203
    
    
    
    
    
    
    
    
    
    
    
    25,622
    
    
    
    203Non-agency securities
    
    
    63,155
    
    
    
    3,946
    
    
    
    30,428
    
    
    
    1,658
    
    
    
    93,583
    
    
    
    5,604Total available-for sale:
    
    
    114,532
    
    
    
    4,531
    
    
    
    30,428
    
    
    
    1,658
    
    
    
    144,960
    
    
    
    6,189Held-to-maturity:Debt securities:Government-sponsored enterprises
    
    
    14,906
    
    
    
    94
    
    
    
    
    
    
    
    
    
    
    
    14,906
    
    
    
    94Municipal bonds
    
    
    1,341
    
    
    
    13
    
    
    
    
    
    
    
    
    
    
    
    1,341
    
    
    
    13Corporate and other debt securities
    
    
    105,855
    
    
    
    32,316
    
    
    
    29,672
    
    
    
    10,826
    
    
    
    135,527
    
    
    
    43,142122,102
    
    
    
    32,423
    
    
    
    29,672
    
    
    
    10,826
    
    
    
    151,774
    
    
    
    43,249Mortgage-backed securities:Federal Home Loan Mortgage Corporation
    
    
    228,833
    
    
    
    3,428
    
    
    
    157,496
    
    
    
    4,753
    
    
    
    386,329
    
    
    
    8,181Federal National Mortgage Association
    
    
    180,992
    
    
    
    1,978
    
    
    
    94,077
    
    
    
    2,651
    
    
    
    275,069
    
    
    
    4,629Non-agency securities
    
    
    51,314
    
    
    
    1,778
    
    
    
    49,151
    
    
    
    2,763
    
    
    
    100,465
    
    
    
    4,541461,139
    
    
    
    7,184
    
    
    
    300,724
    
    
    
    10,167
    
    
    
    761,863
    
    
    
    17,351Total held-to-maturity
    
    
    583,241
    
    
    
    39,607
    
    
    
    330,396
    
    
    
    20,993
    
    
    
    913,637
    
    
    
    60,600Total
    
    $
    697,773
    
    
    
    44,138
    
    
    
    360,824
    
    
    
    22,651
    
    
    
    1,058,597
    
    
    
    66,789
  83




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##### Table of Contents



84




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##### Table of Contents



December 31, 2009Amortized
    
    
    EstimatedCost
    
    
    Fair Value(In thousands)Due in one year or less
    
    $
    25,013
    
    
    
    25,039Due after one year through five years
    
    
    20,109
    
    
    
    20,930Due after five years through ten years
    
    
    246
    
    
    
    245Due after ten years
    
    
    26,541
    
    
    
    43,041Total
    
    $
    71,909
    
    
    
    89,255
  (5) Loans Receivable, Net
  December 31,
    
    
    June 30,2009
    
    
    2009
    
    
    2008(In thousands)Residential mortgage loans:One- to four-family
    
    $
    4,756,042
    
    
    
    4,690,335
    
    
    
    3,989,334FHA
    
    
    17,514
    
    
    
    18,564
    
    
    
    20,229Multi-family loans
    
    
    612,743
    
    
    
    482,783
    
    
    
    82,711Commercial real estate loans
    
    
    730,012
    
    
    
    433,204
    
    
    
    142,396Construction loans
    
    
    334,480
    
    
    
    346,967
    
    
    
    260,177Commercial & industrial loans
    
    
    23,159
    
    
    
    15,665
    
    
    
    47Consumer and other loans
    
    
    178,177
    
    
    
    184,198
    
    
    
    168,819Total loans
    
    
    6,652,127
    
    
    
    6,171,716
    
    
    
    4,663,713Premiums on purchased loans, net
    
    
    22,958
    
    
    
    21,313
    
    
    
    22,622Deferred loan fees, net
    
    
    (4,574
    )
    
    
    (3,252
    )
    
    
    (2,620
    )Allowance for loan losses
    
    
    (55,052
    )
    
    
    (46,608
    )
    
    
    (13,565
    )$
    6,615,459
    
    
    
    6,143,169
    
    
    
    4,670,150
  85




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##### Table of Contents



An analysis of the allowance for loan losses is as follows:
 Six Month Period EndedDecember 31,
    
    
    Year Ended June 30,2009
    
    
    2008
    
    
    2009
    
    
    2008
    
    
    2007(Unaudited)(In thousands)Balance at beginning of year
    
    $
    46,608
    
    
    
    13,565
    
    
    
    13,565
    
    
    
    6,951
    
    
    
    6,369Loans charged off
    
    
    (15,025
    )
    
    
    (16
    )
    
    
    (25
    )
    
    
    (33
    )
    
    
    (151
    )Recoveries
    
    
    44
    
    
    
    
    
    
    
    
    
    
    
    1
    
    
    
    4Net charge-offs
    
    
    (14,981
    )
    
    
    (16
    )
    
    
    (25
    )
    
    
    (32
    )
    
    
    (147
    )Allowance from acquisition
    
    
    
    
    
    
    
    
    
    
    4,043
    
    
    
    
    
    
    
    Provision for loan losses
    
    
    23,425
    
    
    
    13,000
    
    
    
    29,025
    
    
    
    6,646
    
    
    
    729Balance at end of year
    
    $
    55,052
    
    
    
    26,549
    
    
    
    46,608
    
    
    
    13,565
    
    
    
    6,951
    (6) Accrued Interest Receivable
  December 31,
    
    
    June 30,2009
    
    
    2009
    
    
    2008(In thousands)Securities
    
    $
    4,543
    
    
    
    5,225
    
    
    
    6,041Loans receivable
    
    
    32,399
    
    
    
    32,066
    
    
    
    21,675$
    36,942
    
    
    
    37,291
    
    
    
    27,716
 86




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##### Table of Contents



(7) Office Properties and Equipment, Net
 Office properties and equipment are summarized as follows:
 December 31,
    
    
    June 30,2009
    
    
    2009
    
    
    2008(In thousands)Land
    
    $
    9,339
    
    
    
    8,301
    
    
    
    5,702Office buildings
    
    
    23,637
    
    
    
    22,286
    
    
    
    14,108Leasehold improvements
    
    
    17,239
    
    
    
    15,912
    
    
    
    14,638Furniture, fixtures and equipment
    
    
    17,131
    
    
    
    16,774
    
    
    
    18,265Construction in process
    
    
    3,190
    
    
    
    2,529
    
    
    
    1,66170,536
    
    
    
    65,802
    
    
    
    54,374Less accumulated depreciation and amortization
    
    
    21,152
    
    
    
    21,660
    
    
    
    24,664$
    49,384
    
    
    
    44,142
    
    
    
    29,710
  (8) Deposits
  December 31,
    
    
    June 30,2009
    
    
    2009
    
    
    2008Weighted
    
    
    
    
    
    
    %
    
    
    Weighted
    
    
    
    
    
    
    %
    
    
    Weighted
    
    
    
    
    
    
    %Average
    
    
    
    
    
    
    of
    
    
    Average
    
    
    
    
    
    
    of
    
    
    Average
    
    
    
    
    
    
    ofRate
    
    
    Amount
    
    
    Total
    
    
    Rate
    
    
    Amount
    
    
    Total
    
    
    Rate
    
    
    Amount
    
    
    Total(Dollars in thousands)Savings
    
    
    1.64
    %
    
    $
    877,421
    
    
    
    15.02
    %
    
    
    1.99
    %
    
    
    779,678
    
    
    
    14.16
    %
    
    
    1.96
    %
    
    
    417,196
    
    
    
    10.51
    %Checking accounts
    
    
    0.81
    
    
    
    927,675
    
    
    
    15.88
    
    
    
    0.84
    
    
    
    898,816
    
    
    
    16.33
    
    
    
    1.28
    
    
    
    401,100
    
    
    
    10.10Money market deposits
    
    
    1.26
    
    
    
    742,618
    
    
    
    12.72
    
    
    
    1.76
    
    
    
    521,425
    
    
    
    9.47
    
    
    
    2.06
    
    
    
    229,018
    
    
    
    5.77Total transaction accounts
    
    
    1.21
    
    
    
    2,547,714
    
    
    
    43.62
    
    
    
    1.46
    
    
    
    2,199,919
    
    
    
    39.96
    
    
    
    1.72
    
    
    
    1,047,314
    
    
    
    26.38Certificates of deposit
    
    
    2.18
    
    
    
    3,292,929
    
    
    
    56.38
    
    
    
    2.80
    
    
    
    3,305,828
    
    
    
    60.04
    
    
    
    3 71
    
    
    
    2,922,961
    
    
    
    73.62Total deposits
    
    
    1.77
    %
    
    $
    5,840,643
    
    
    
    100.00
    %
    
    
    2.27
    %
    
    
    5,505,747
    
    
    
    100.00
    %
    
    
    3.18
    %
    
    
    3,970,275
    
    
    
    100.00
    %
  December 31, 2009
    
    
    June 30, 2009(In thousands)Within one year
    
    $
    2,373,901
    
    
    
    2,625,585One to two years
    
    
    610,301
    
    
    
    346,582Two to three years
    
    
    188,260
    
    
    
    230,255Three to four years
    
    
    29,516
    
    
    
    29,656After four years
    
    
    90,951
    
    
    
    73,750$
    3,292,929
    
    
    
    3,305,828
   Six month period endedDecember 31,
    
    
    Year Ended June 30,2009
    
    
    2008
    
    
    2009
    
    
    2008
    
    
    2007(Unaudited)(In thousands)Savings
    
    $
    7,615
    
    
    
    3,650
    
    
    
    10,568
    
    
    
    7,718
    
    
    
    4,685Checking accounts
    
    
    4,426
    
    
    
    2,842
    
    
    
    11,668
    
    
    
    7,329
    
    
    
    7,473Money market deposits
    
    
    4,392
    
    
    
    3,024
    
    
    
    6,466
    
    
    
    5,005
    
    
    
    3,596Certificates of deposit
    
    
    40,144
    
    
    
    53,421
    
    
    
    100,660
    
    
    
    132,693
    
    
    
    124,382$
    56,577
    
    
    
    62,937
    
    
    
    129,362
    
    
    
    152,745
    
    
    
    140,136
 87




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##### Table of Contents



(9) Borrowed Funds
  December 31,
    
    
    June 30,2009
    
    
    2009
    
    
    2008Weighted
    
    
    
    
    
    
    Weighted
    
    
    
    
    
    
    WeightedAverage
    
    
    
    
    
    
    Average
    
    
    
    
    
    
    AveragePrincipal
    
    
    Rate
    
    
    Principal
    
    
    Rate
    
    
    Principal
    
    
    Rate(Dollars in thousands)Funds borrowed under repurchase agreements:FHLB
    
    $
    310,000
    
    
    
    3.94
    %
    
    
    420,000
    
    
    
    3.98
    %
    
    
    560,000
    
    
    
    3.87
    %Other brokers
    
    
    440,000
    
    
    
    4.65
    
    
    
    440,000
    
    
    
    4.65
    
    
    
    440,000
    
    
    
    4.79Total funds borrowed under repurchase
agreements
    
    
    750,000
    
    
    
    4.36
    
    
    
    860,000
    
    
    
    4.32
    
    
    
    1,000,000
    
    
    
    4.27Other borrowed funds:FHLB advances
    
    
    850,542
    
    
    
    3.79
    
    
    
    870,555
    
    
    
    3.66
    
    
    
    563,583
    
    
    
    3.50Total borrowed funds
    
    $
    1,600,542
    
    
    
    4.05
    
    
    
    1,730,555
    
    
    
    3.99
    
    
    
    1,563,583
    
    
    
    3.99
  December 31
    
    
    June 30,2009
    
    
    2009
    
    
    2008Weighted
    
    
    
    
    
    
    Weighted
    
    
    
    
    
    
    WeightedAverage
    
    
    
    
    
    
    Average
    
    
    
    
    
    
    AveragePrincipal
    
    
    Rate
    
    
    Principal
    
    
    Rate
    
    
    Principal
    
    
    Rate(Dollars in thousands)Within one year
    
    $
    355,000
    
    
    
    4.05
    %
    
    
    305,000
    
    
    
    3.46
    %
    
    
    333,000
    
    
    
    3.31
    %One to two years
    
    
    520,000
    
    
    
    4.32
    
    
    
    595,000
    
    
    
    4.46
    
    
    
    285,000
    
    
    
    3.78Two to three years
    
    
    380,542
    
    
    
    3.92
    
    
    
    430,555
    
    
    
    3.81
    
    
    
    440,000
    
    
    
    4.68Three to four years
    
    
    240,000
    
    
    
    3.90
    
    
    
    280,000
    
    
    
    3.90
    
    
    
    225,583
    
    
    
    4.04Four to five years
    
    
    55,000
    
    
    
    3.38
    
    
    
    70,000
    
    
    
    3.76
    
    
    
    230,000
    
    
    
    3.93After five years
    
    
    50,000
    
    
    
    3.86
    
    
    
    50,000
    
    
    
    3.86
    
    
    
    50,000
    
    
    
    3.86Total borrowed funds
    
    $
    1,600,542
    
    
    
    4.05
    
    
    
    1,730,555
    
    
    
    3.99
    
    
    
    1,563,583
    
    
    
    3.99
   December 31,
    
    
    June 30,2009
    
    
    2009
    
    
    2008(In thousands)Amortized cost of collateral:Debt securities
    
    $
    25,004
    
    
    
    28,009
    
    
    
    40,120Mortgage-backed securities
    
    
    993,133
    
    
    
    934,805
    
    
    
    1,023,408Total amortized cost of collateral
    
    $
    1,018,137
    
    
    
    962,814
    
    
    
    1,063,528Fair value of collateral:Debt securities
    
    $
    25,752
    
    
    
    28,948
    
    
    
    40,423Mortgage-backed securities
    
    
    1,014,226
    
    
    
    946,073
    
    
    
    1,009,985Total fair value of collateral
    
    $
    1,039,978
    
    
    
    975,021
    
    
    
    1,050,408
    88




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##### Table of Contents



(10) Income Taxes
  Six month period ended
    
    
    Year EndedDecember 31,
    
    
    June 30,2009
    
    
    2008
    
    
    2009
    
    
    2008
    
    
    2007(Unaudited)(In thousands)Current tax expense:Federal
    
    $
    15,850
    
    
    
    12,748
    
    
    
    22,925
    
    
    
    10,020
    
    
    
    5,166State
    
    
    16
    
    
    
    90
    
    
    
    106
    
    
    
    612
    
    
    
    1,37315,866
    
    
    
    12,838
    
    
    
    23,031
    
    
    
    10,632
    
    
    
    6,539Deferred tax (benefit) expense:Federal
    
    
    (4,935
    )
    
    
    (54,320
    )
    
    
    (57,386
    )
    
    
    (1,335
    )
    
    
    6,565State
    
    
    3,390
    
    
    
    (11,841
    )
    
    
    (9,845
    )
    
    
    (267
    )
    
    
    (20,581
    )(1,545
    )
    
    
    (66,161
    )
    
    
    (67,231
    )
    
    
    (1,602
    )
    
    
    (14,016
    )Total income tax expense (benefit)
    
    $
    14,321
    
    
    
    (53,323
    )
    
    
    (44,200
    )
    
    
    9,030
    
    
    
    (7,477
    )
  Six month period ended
    
    
    Year EndedDecember 31,
    
    
    June 30,2009
    
    
    2008
    
    
    2009
    
    
    2008
    
    
    2007(Unaudited)(In thousands)Expected federal income tax expense
    
    $
    12,909
    
    
    
    (45,777
    )
    
    
    (38,191
    )
    
    
    8,770
    
    
    
    5,177State tax, net
    
    
    2,214
    
    
    
    (7,638
    )
    
    
    (6,330
    )
    
    
    224
    
    
    
    (12,486
    )Bank owned life insurance
    
    
    (455
    )
    
    
    (694
    )
    
    
    (1,005
    )
    
    
    (1,391
    )
    
    
    (1,293
    )Change in valuation allowance for federal
deferred tax assets
    
    
    (1,110
    )
    
    
    176
    
    
    
    407
    
    
    
    281
    
    
    
    1,075Dividend received deduction
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (339
    )ESOP fair market value adjustment
    
    
    4
    
    
    
    100
    
    
    
    81
    
    
    
    211
    
    
    
    229Non-deductible compensation
    
    
    697
    
    
    
    458
    
    
    
    742
    
    
    
    455
    
    
    
    Other
    
    
    62
    
    
    
    52
    
    
    
    96
    
    
    
    480
    
    
    
    160Total income tax expense (benefit)
    
    $
    14,321
    
    
    
    (53,323
    )
    
    
    (44,200
    )
    
    
    9,030
    
    
    
    (7,477
    )
 89




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##### Table of Contents



December 31,
    
    
    June 30,2009
    
    
    2009
    
    
    2008(In thousands)Deferred tax asset:Employee benefits
    
    $
    13,605
    
    
    
    15,533
    
    
    
    11,621Deferred compensation
    
    
    1,016
    
    
    
    1,034
    
    
    
    1,506State net operating loss (NOL) carryforwards
    
    
    2,585
    
    
    
    5,761
    
    
    
    9,882Intangible assets
    
    
    16
    
    
    
    302
    
    
    
    830Allowance for loan losses
    
    
    19,725
    
    
    
    11,670
    
    
    
    5,482Premises and equipment, differences in depreciation
    
    
    
    
    
    
    
    
    
    
    131Net unrealized loss on securities
    
    
    13,960
    
    
    
    16,171
    
    
    
    2,323Net other than temporary impairment loss on securities
    
    
    49,479
    
    
    
    49,442
    
    
    
    New Jersey alternative minimum assessment
    
    
    2,402
    
    
    
    2,402
    
    
    
    2,402Capital losses on securities
    
    
    2,533
    
    
    
    2,533
    
    
    
    2,053Contribution to charitable foundation
    
    
    1,418
    
    
    
    4,708
    
    
    
    6,887ESOP
    
    
    1,517
    
    
    
    1,021
    
    
    
    646Allowance for delinquent interest
    
    
    4,807
    
    
    
    3,712
    
    
    
    353Federal NOL carryforwards
    
    
    4,391
    
    
    
    4,391
    
    
    
    Fair value adjustments related to acquisition
    
    
    2,539
    
    
    
    2,903
    
    
    
    Other
    
    
    592
    
    
    
    1,934
    
    
    
    1,173Gross deferred tax asset
    
    
    120,585
    
    
    
    123,517
    
    
    
    45,289Valuation allowance
    
    
    (3,642
    )
    
    
    (4,734
    )
    
    
    (4,268
    )116,943
    
    
    
    118,783
    
    
    
    41,021Deferred tax liability:Discount accretion
    
    
    (12
    )
    
    
    322
    
    
    
    319Premises and equipment, differences in depreciation
    
    
    (188
    )
    
    
    6
    
    
    
    Gross deferred tax liability
    
    
    (200
    )
    
    
    328
    
    
    
    319Net deferred tax asset
    
    $
    117,143
    
    
    
    118,455
    
    
    
    40,702
      90




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(11) Benefit Plans
 Defined Benefit Pension Plan
  SERP, Directors Plan and Other Postretirement Benefits Plan
     Six MonthPeriod EndedDecember 31,
    
    
    Year Ended June 30,2009
    
    
    2009
    
    
    2008(In thousands)Change in benefit obligation:Benefit obligation at beginning of year
    
    $
    17,307
    
    
    
    15,862
    
    
    
    16,531Service cost
    
    
    293
    
    
    
    543
    
    
    
    456Interest cost
    
    
    525
    
    
    
    1,054
    
    
    
    958Actuarial (gain) loss
    
    
    (1,423
    )
    
    
    1,000
    
    
    
    1,065Benefits paid
    
    
    (642
    )
    
    
    (1,152
    )
    
    
    (3,148
    )Benefit obligation at end of year
    
    $
    16,060
    
    
    
    17,307
    
    
    
    15,862Funded status
    
    $
    (16,060
    )
    
    
    (17,307
    )
    
    
    (15,862
    )
  91




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##### Table of Contents



Six MonthPeriod EndedDecember 31,
    
    
    Year Ended June 30,2009
    
    
    2009
    
    
    2008(In thousands)Prior service cost
    
    $
    537
    
    
    
    585
    
    
    
    683Net actuarial loss
    
    
    2,044
    
    
    
    3,559
    
    
    
    2,697Total amounts recognized in
accumulated other
comprehensive income
    
    $
    2,581
    
    
    
    4,144
    
    
    
    3,380
   Six MonthPeriod EndedDecember 31,
    
    Year Ended June 30,2009
    
    2009
    
    2008Discount rate
    
    
    5.61
    %
    
    
    6.18
    %
    
    
    6.75
    %Rate of compensation increase
    
    
    3.58
    
    
    
    3.56
    
    
    
    3.64
  Six MonthPeriod EndedDecember 31,
    
    
    Year Ended June 30,2009
    
    
    2008
    
    
    2009
    
    
    2008
    
    
    2007(Unaudited)(In thousands)Service cost
    
    $
    293
    
    
    
    225
    
    
    
    543
    
    
    
    456
    
    
    
    1,184Interest cost
    
    
    525
    
    
    
    513
    
    
    
    1,054
    
    
    
    958
    
    
    
    898Amortization of:Prior service cost
    
    
    49
    
    
    
    49
    
    
    
    97
    
    
    
    98
    
    
    
    19Net loss
    
    
    91
    
    
    
    64
    
    
    
    138
    
    
    
    114
    
    
    
    150Total net periodic benefit cost
    
    $
    958
    
    
    
    851
    
    
    
    1,832
    
    
    
    1,626
    
    
    
    2,251
 92




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Six MonthPeriod EndedDecember 31,
    
    Year Ended June 30,2009
    
    2009
    
    2008
    
    2007Discount rate
    
    
    6.18
    %
    
    
    6.75
    %
    
    
    6.25
    %
    
    
    6.25
    %Rate of compensation increase
    
    
    3.56
    
    
    
    3.64
    
    
    
    5.05
    
    
    
    6.82
  Amount(In thousands)2010
    
    $
    1,1152011
    
    
    1,0982012
    
    
    1,1272013
    
    
    1,1232014
    
    
    1,1022015 through 2018
    
    
    5,224
 Summit Federal Benefit Plans
  401(k) Plan
  Employee Stock Ownership Plan
    93




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Equity Incentive Plan
       94




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##### Table of Contents



WeightedNumber of
    
    
    AverageShares
    
    
    Grant DateAwarded
    
    
    Fair ValueNon-vested at June 30, 2009
    
    
    1,130,063
    
    
    $
    14.92Granted
    
    
    5,000
    
    
    
    9.98Vested
    
    
    (375,648
    )
    
    
    15.07Forfeited
    
    
    
    
    
    
    Non-vested at December 31, 2009.
    
    
    759,415
    
    
    $
    14.82
   WeightedWeighted
    
    
    AverageNumber of
    
    
    Average
    
    
    Remaining
    
    
    AggregateStock
    
    
    Exercise
    
    
    Contractual
    
    
    IntrinsicOptions
    
    
    Price
    
    
    Life
    
    
    ValueOutstanding at June 30, 2009
    
    
    5,136,752
    
    
    $
    15.02
    
    
    7.6 years
    
    $
    Granted
    
    
    10,000
    
    
    
    9.98Exercised
    
    
    
    
    
    
    Forfeited
    
    
    
    
    
    
    Outstanding at December 31, 2009.
    
    
    5,146,752
    
    
    $
    15.01
    
    
    7.1 years
    
    $
    Exercisable at December 31, 2009.
    
    
    3,100,724
    
    
    $
    15.13
    
    
    7.0 years
    
    $
    
  December 31,
    
    June 30,2009
    
    2009Expected dividend yield
    
    
    0.90
    %
    
    
    0.91
    %Expected volatility
    
    
    34.35
    %
    
    
    27.59
    %Risk-free interest rate
    
    
    2.71
    %
    
    
    2.60
    %Expected option life
    
    6.5 years
    
    6.5 years
  (12) Commitments and Contingencies
    95




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Amount(In thousands)2010
    
    $
    5,3922011
    
    
    5,2272012
    
    
    4,9062013
    
    
    4,3522014
    
    
    4,181Thereafter
    
    
    37,605$
    61,663
 Financial Transactions with Off-Balance-Sheet Risk and Concentrations of Credit Risk
        96




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##### Table of Contents



(13) Fair Value Measurements
     
    
    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.
   Securities available-for-sale
  97




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Carrying Value at December 31, 2009Total
    
    
    Level 1
    
    
    Level 2
    
    
    Level 3(In thousands)Securities available for sale:Mortgage-backed securities
    
    $
    444,151
    
    
    
    
    
    
    
    444,151
    
    
    
    GSE debt securities
    
    
    25,039
    
    
    
    
    
    
    
    25,039
    
    
    
    Equity securities
    
    
    2,053
    
    
    
    
    
    
    
    2,053
    
    
    
    $
    471,243
    
    
    
    
    
    
    
    471,243
    
    
    
    
 Carrying Value at June 30, 2009Total
    
    
    Level 1
    
    
    Level 2
    
    
    Level 3(In thousands)Securities available for sale:Mortgage-backed securities
    
    $
    323,339
    
    
    
    
    
    
    
    323,339
    
    
    
    GSE debt securities
    
    
    30,079
    
    
    
    
    
    
    
    30,079
    
    
    
    Equity securities
    
    
    1,598
    
    
    
    
    
    
    
    1,598
    
    
    
    $
    355,016
    
    
    
    
    
    
    
    355,016
    
    
    
    
  Securities held-to-maturity
  Mortgage Servicing Rights, net
  Loans Receivable
  98




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Carrying Value at December 31, 2009Total
    
    
    Level 1
    
    
    Level 2
    
    
    Level 3(In thousands)MSR, net.
    
    $
    5,496
    
    
    
    
    
    
    
    
    
    
    
    5,496Impaired loans
    
    $
    39,437
    
    
    
    
    
    
    
    
    
    
    $
    39,437$
    44,933
    
    
    
    
    
    
    
    
    
    
    $
    44,933
 Carrying Value at June 30, 2009Total
    
    
    Level 1
    
    
    Level 2
    
    
    Level 3(In thousands)Securities held-to-maturity
    
    $
    20,727
    
    
    
    
    
    
    
    20,727
    
    
    
    MSR, net
    
    
    4,533
    
    
    
    
    
    
    
    
    
    
    
    4,533Impaired loans
    
    
    63,529
    
    
    
    
    
    
    
    
    
    
    
    63,529$
    88,789
    
    
    
    
    
    
    
    20,727
    
    
    
    68,062
 (14) Fair Value of Financial Instruments
  Cash and Cash Equivalents
  Securities
  FHLB Stock
  Loans
   Deposit Liabilities
  99




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##### Table of Contents



Borrowings
  Commitments to Extend Credit
   December 31,
    
    
    June 30,
    
    
    June 30,2009
    
    
    2009
    
    
    2008Carrying
    
    
    
    
    
    
    Carrying
    
    
    
    
    
    
    CarryingAmount
    
    
    Fair Value
    
    
    Amount
    
    
    Fair Value
    
    
    Amount
    
    
    Fair Value(In thousands)Financial assets:Cash and cash equivalents
    
    $
    73,606
    
    
    
    73,606
    
    
    
    317,757
    
    
    
    317,757
    
    
    
    22,823
    
    
    
    22,823Securities available-for-sale
    
    
    471,243
    
    
    
    471,243
    
    
    
    355,016
    
    
    
    355,016
    
    
    
    203,032
    
    
    
    203,032Securities held-to-maturity
    
    
    717,441
    
    
    
    753,405
    
    
    
    846,043
    
    
    
    861,302
    
    
    
    1,255,054
    
    
    
    1,198,053Stock in FHLB
    
    
    66,202
    
    
    
    66,202
    
    
    
    72,053
    
    
    
    72,053
    
    
    
    60,935
    
    
    
    60,935Loans
    
    
    6,642,502
    
    
    
    6,821,767
    
    
    
    6,204,860
    
    
    
    6,351,544
    
    
    
    4,679,964
    
    
    
    4,640,276Financial liabilities:Deposits
    
    
    5,840,643
    
    
    
    5,881,083
    
    
    
    5,505,747
    
    
    
    5,547,871
    
    
    
    3,970,275
    
    
    
    3,977,634Borrowed funds
    
    
    1,600,542
    
    
    
    1,666,513
    
    
    
    1,730,555
    
    
    
    1,799,840
    
    
    
    1,563,583
    
    
    
    1,580,064
 Limitations
   (15) Regulatory Capital
  100




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##### Table of Contents



Quantitative measures established by regulation to ensure capital adequacy require the
Company and the Bank to maintain minimum amounts and ratios of total and Tier I capital (as
defined in the regulations) to risk- weighted assets (as defined), and of Tier I capital (as
defined) to average assets (as defined). Management believes, as of December 31, 2009, June 30,
2009 and 2008, that the Company and the Bank met all capital adequacy requirements to which they
are subject.As of December 31, 2009, the most recent notification from the Federal Deposit Insurance
Corporation categorized the Bank as well capitalized under the regulatory framework for prompt
corrective action. To be categorized as well capitalized, the Bank must maintain minimum total
risk-based, Tier I risk-based, and Tier I leverage ratios as set forth in the table. There are
no conditions or events since that notification that management believes have changed the Banks
category.The following is a summary of the Banks actual capital amounts and ratios as of December 31,
2009 compared to the FDIC minimum capital adequacy requirements and the FDIC requirements for
classification as a well-capitalized institution.
 Minimum RequirementsTo be WellCapitalizedUnder PromptFor Capital
    
    CorrectiveActual
    
    Adequacy Purposes
    
    Action ProvisionsAmount
    
    Ratio
    
    Amount
    
    Ratio
    
    Amount
    
    Ratio(Dollars in thousands)As of December 31, 2009:Total capital (to risk-weighted assets)
    
    $
    804,637
    
    
    
    15.8
    %
    
    $
    407,909
    
    
    
    8.0
    %
    
    $
    509,886
    
    
    
    10.0
    %Tier I capital (to risk-weighted assets)
    
    
    749,585
    
    
    
    14.7
    
    
    
    203,955
    
    
    
    4.0
    
    
    
    305,932
    
    
    
    6.0Tier I capital (to average assets)
    
    
    749,585
    
    
    
    9.0
    
    
    
    332,129
    
    
    
    4.0
    
    
    
    415,162
    
    
    
    5.0
 Minimum RequirementsTo be WellCapitalizedUnder PromptFor Capital
    
    CorrectiveActual
    
    Adequacy Purposes
    
    Action ProvisionsAmount
    
    Ratio
    
    Amount
    
    Ratio
    
    Amount
    
    Ratio(Dollars in thousands)As of June 30, 2009:Total capital (to risk-weighted assets)
    
    $
    776,505
    
    
    
    16.9
    %
    
    $
    368,096
    
    
    
    8.0
    %
    
    $
    460,121
    
    
    
    10.0
    %Tier I capital (to risk-weighted assets)
    
    
    729,897
    
    
    
    15.9
    
    
    
    184,048
    
    
    
    4.0
    
    
    
    276,072
    
    
    
    6.0Tier I capital (to average assets)
    
    
    729,897
    
    
    
    9.5
    
    
    
    306,832
    
    
    
    4.0
    
    
    
    383,539
    
    
    
    5.0
 Minimum RequirementsTo be WellCapitalizedUnder PromptFor Capital
    
    CorrectiveActual
    
    Adequacy Purposes
    
    Action ProvisionsAmount
    
    Ratio
    
    Amount
    
    Ratio
    
    Amount
    
    Ratio(Dollars in thousands)As of June 30, 2008:Total capital (to risk-weighted assets)
    
    $
    741,028
    
    
    
    21.8
    %
    
    $
    272,329
    
    
    
    8.0
    %
    
    $
    340,411
    
    
    
    10.0
    %Tier I capital (to risk-weighted assets)
    
    
    727,463
    
    
    
    21.4
    
    
    
    136,164
    
    
    
    4.0
    
    
    
    204,247
    
    
    
    6.0Tier I capital (to average assets)
    
    
    727,463
    
    
    
    11.9
    
    
    
    243,859
    
    
    
    4.0
    
    
    
    304,824
    
    
    
    5.0
 101




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##### Table of Contents



(16) Parent Company Only Financial Statements
 The following condensed financial statements for Investors Bancorp, Inc. (parent company only)
reflect the investment in its wholly-owned subsidiary, Investors Savings Bank, using the equity
method of accounting.
 Balance Sheets
 December 31,
    
    
    June 30,2009
    
    
    2009
    
    
    2008(In thousands)Assets:Cash and due from bank
    
    $
    14,640
    
    
    
    18,589
    
    
    
    58,397Securities available-for-sale, at estimated fair value
    
    
    2,053
    
    
    
    1,598
    
    
    
    1,238Investment in subsidiary
    
    
    758,079
    
    
    
    729,009
    
    
    
    722,137ESOP loan receivable
    
    
    37,690
    
    
    
    38,659
    
    
    
    39,159Other assets
    
    
    37,859
    
    
    
    31,998
    
    
    
    8,407Total Assets
    
    $
    850,321
    
    
    
    819,853
    
    
    
    829,338Liabilities and Stockholders Equity:Total liabilities
    
    $
    108
    
    
    
    570
    
    
    
    800Total stockholders equity
    
    
    850,213
    
    
    
    819,283
    
    
    
    828,538Total Liabilities and Stockholders Equity
    
    $
    850,321
    
    
    
    819,853
    
    
    
    829,338
 Statements of Operations
 Six month period ended
    
    
    Year EndedDecember 31,
    
    
    June 30,2009
    
    
    2008
    
    
    2009
    
    
    2008
    
    
    2007(Unaudited)(In thousands)Income:Interest on ESOP loan receivable
    
    $
    628
    
    
    
    1,423
    
    
    
    2,077
    
    
    
    3,055
    
    
    
    3,082Interest on deposit with subsidiary
    
    
    59
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,929Income (loss) on securities transactions
    
    
    
    
    
    
    
    
    
    
    6
    
    
    
    (21
    )
    
    
    687
    
    
    
    1,423
    
    
    
    2,083
    
    
    
    3,034
    
    
    
    6,011Expenses:Other expenses
    
    
    509
    
    
    
    502
    
    
    
    954
    
    
    
    827
    
    
    
    798509
    
    
    
    502
    
    
    
    954
    
    
    
    827
    
    
    
    798Income before income tax expense
    
    
    178
    
    
    
    921
    
    
    
    1,129
    
    
    
    2,207
    
    
    
    5,213Income tax (benefit) expense
    
    
    (1,142
    )
    
    
    379
    
    
    
    452
    
    
    
    893
    
    
    
    1,168Income before undistributed earnings of subsidiary
    
    
    1,320
    
    
    
    542
    
    
    
    677
    
    
    
    1,314
    
    
    
    4,045Equity in undistributed earnings (losses) of subsidiary
    
    
    21,242
    
    
    
    (78,010
    )
    
    
    (65,595
    )
    
    
    14,715
    
    
    
    18,221Net income (loss)
    
    $
    22,562
    
    
    
    (77,468
    )
    
    
    (64,918
    )
    
    
    16,029
    
    
    
    22,266
 102




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##### Table of Contents



Statements of Cash Flows
 Six month period ended
    
    
    Year EndedDecember 31,
    
    
    June 30,2009
    
    
    2008
    
    
    2009
    
    
    2008
    
    
    2007(Unaudited)(In thousands)Cash flows from operating activities:Net income(loss)
    
    $
    22,562
    
    
    
    (77,468
    )
    
    
    (64,918
    )
    
    
    16,029
    
    
    
    22,266Adjustments to reconcile net income to net cash
(used in) provided by operating activities:Equity in undistributed (earnings) losses of
subsidiary
    
    
    (21,242
    )
    
    
    78,010
    
    
    
    65,595
    
    
    
    (14,715
    )
    
    
    (18,221
    )(Gain) loss on securities transactions
    
    
    
    
    
    
    
    
    
    
    (6
    )
    
    
    21
    
    
    
    (Increase) decrease in other assets
    
    
    (5,861
    )
    
    
    (8,076
    )
    
    
    (23,592
    )
    
    
    938
    
    
    
    (7,494
    )(Decrease) increase in other liabilities
    
    
    (462
    )
    
    
    (767
    )
    
    
    (230
    )
    
    
    (8,320
    )
    
    
    8,753Net cash (used in) provided by operating activities
    
    
    (5,003
    )
    
    
    (8,301
    )
    
    
    (23,151
    )
    
    
    (6,047
    )
    
    
    5,304Cash flows from investing activities:Net outlay for business acquisition
    
    
    
    
    
    
    
    
    
    
    (37,840
    )
    
    
    
    
    
    
    Purchase of investments available-for-sale
    
    
    (250
    )
    
    
    (100
    )
    
    
    (200
    )
    
    
    (1,400
    )
    
    
    Principal collected on ESOP loan
    
    
    969
    
    
    
    499
    
    
    
    499
    
    
    
    399
    
    
    
    441Net cash provided by (used in) investing activities
    
    
    719
    
    
    
    399
    
    
    
    (37,541
    )
    
    
    (1,001
    )
    
    
    441Cash flows from financing activities:Proceeds from subsidiary capital distributions
    
    
    
    
    
    
    
    
    
    
    19,361
    
    
    
    
    
    
    
    Re-payments of subsidiary capital distributions
    
    
    (1,290
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Proceeds from sale of treasury stock to subsidiary
    
    
    4,061
    
    
    
    4,162
    
    
    
    5,631
    
    
    
    4,726
    
    
    
    Purchase of treasury stock
    
    
    (2,436
    )
    
    
    (1,097
    )
    
    
    (4,108
    )
    
    
    (60,124
    )
    
    
    (96,706
    )Net cash provided by (used in) financing activities
    
    
    335
    
    
    
    3,065
    
    
    
    20,884
    
    
    
    (55,398
    )
    
    
    (96,706
    )Net decrease in cash and due from bank
    
    
    (3,949
    )
    
    
    (4,837
    )
    
    
    (39,808
    )
    
    
    (62,446
    )
    
    
    (90,961
    )Cash and due from bank at beginning of year
    
    
    18,589
    
    
    
    58,397
    
    
    
    58,397
    
    
    
    120,843
    
    
    
    211,804Cash and due from bank at end of year
    
    $
    14,640
    
    
    
    53,560
    
    
    
    18,589
    
    
    
    58,397
    
    
    
    120,843
 (17) Selected Quarterly Financial Data (Unaudited)
 The following tables are a summary of certain quarterly financial data for the six month period
ended December 31, 2009, and fiscal years ended June 30, 2009 and 2008.
 Quarter endedSeptember 30, 2009
    
    
    December 31, 2009(In thousands, except per share data)Interest and dividend income
    
    $
    98,631
    
    
    
    99,641Interest expense
    
    
    47,176
    
    
    
    43,295Net interest income
    
    
    51,455
    
    
    
    56,346Provision for loan losses
    
    
    12,375
    
    
    
    11,050Net interest income after provision for loan losses
    
    
    39,080
    
    
    
    45,296Non-interest income
    
    
    5,359
    
    
    
    3,648Non-interest expenses
    
    
    26,611
    
    
    
    29,889Income before income tax expense
    
    
    17,828
    
    
    
    19,055Income tax expense
    
    
    7,355
    
    
    
    6,966Net income
    
    $
    10,473
    
    
    
    12,089Basic and diluted earnings per common share
    
    $
    0.10
    
    
    
    0.11
 103




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##### Table of Contents



Fiscal 2009 Quarter EndedSeptember 30
    
    
    December 31
    
    
    March 31
    
    
    June 30(In thousands, except per share data)Interest and dividend income
    
    $
    87,448
    
    
    
    94,499
    
    
    
    92,749
    
    
    
    93,364Interest expense
    
    
    48,708
    
    
    
    51,591
    
    
    
    51,591
    
    
    
    50,034Net interest income
    
    
    38,740
    
    
    
    42,908
    
    
    
    41,158
    
    
    
    43,330Provision for loan losses
    
    
    5,000
    
    
    
    8,000
    
    
    
    8,000
    
    
    
    8,025Net interest income after provision for loan losses
    
    
    33,740
    
    
    
    34,908
    
    
    
    33,158
    
    
    
    35,305Non-interest (loss) income
    
    
    (2,232
    )
    
    
    (152,026
    )
    
    
    3,417
    
    
    
    2,411Non-interest expenses
    
    
    22,361
    
    
    
    22,820
    
    
    
    24,455
    
    
    
    28,163Income before income tax expense
    
    
    9,147
    
    
    
    (139,938
    )
    
    
    12,120
    
    
    
    9,553Income tax expense (benefit)
    
    
    3,656
    
    
    
    (56,979
    )
    
    
    5,042
    
    
    
    4,081Net income (loss)
    
    $
    5,491
    
    
    
    (82,959
    )
    
    
    7,078
    
    
    
    5,472Basic and diluted earnings per common share
    
    $
    0.05
    
    
    
    (0.80
    )
    
    
    0.07
    
    
    
    0.05
 Fiscal 2008 Quarter EndedSeptember 30
    
    
    December 31
    
    
    March 31
    
    
    June 30(In thousands, except per share data)Interest and dividend income
    
    $
    76,120
    
    
    
    79,071
    
    
    
    78,160
    
    
    
    79,456Interest expense
    
    
    53,856
    
    
    
    54,482
    
    
    
    51,282
    
    
    
    48,075Net interest income
    
    
    22,264
    
    
    
    24,589
    
    
    
    26,878
    
    
    
    31,381Provision for loan losses
    
    
    199
    
    
    
    1,750
    
    
    
    997
    
    
    
    3,700Net interest income after provision for loan losses
    
    
    22,065
    
    
    
    22,839
    
    
    
    25,881
    
    
    
    27,681Non-interest income
    
    
    1,662
    
    
    
    2,158
    
    
    
    2,135
    
    
    
    1,418Non-interest expenses
    
    
    20,163
    
    
    
    19,302
    
    
    
    20,634
    
    
    
    20,681Income before income tax expense
    
    
    3,564
    
    
    
    5,695
    
    
    
    7,382
    
    
    
    8,418Income tax expense
    
    
    1,132
    
    
    
    2,112
    
    
    
    2,847
    
    
    
    2,939Net income
    
    $
    2,432
    
    
    
    3,583
    
    
    
    4,535
    
    
    
    5,479Basic and diluted earnings per common share
    
    $
    0.02
    
    
    
    0.03
    
    
    
    0.04
    
    
    
    0.05
 (18) Earnings Per Share
 The following is a summary of the Companys earnings per share calculations and reconciliation of
basic to diluted earnings per share.
 For the six month period ended December 31,2009
    
    
    2008(Unaudited)Per
    
    
    
    
    
    
    
    
    
    
    PerShare
    
    
    
    
    
    
    
    
    
    
    ShareLoss
    
    
    Shares
    
    
    Amount
    
    
    Income
    
    
    Shares
    
    
    Amount(In thousands, except per share data)Net income (loss)
    
    $
    22,562
    
    
    
    
    
    
    
    
    
    
    $
    (77,468
    )Basic earnings (loss) per share:Income (loss) available to
common stockholders
    
    $
    22,562
    
    
    
    109,862,617
    
    
    $
    0.21
    
    
    $
    (77,468
    )
    
    
    103,872,522
    
    
    $
    (0.75
    )Effect of dilutive common stock
equivalents(1)
    
    
    
    
    
    
    126,431
    
    
    
    
    
    
    
    
    
    
    
    Diluted earnings (loss) per
share:Income (loss) available to
common stockholders
    
    $
    22,562
    
    
    
    109,989,048
    
    
    $
    0.21
    
    
    $
    (77,468
    )
    
    
    103,872,522
    
    
    $
    (0.75
    )
 104




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##### Table of Contents



For the Years Ended June 30,2009
    
    
    2008
    
    
    2007Per
    
    
    
    
    
    
    
    
    
    
    Per
    
    
    
    
    
    
    
    
    
    
    PerShare
    
    
    
    
    
    
    
    
    
    
    Share
    
    
    
    
    
    
    
    
    
    
    ShareLoss
    
    
    Shares
    
    
    Amount
    
    
    Income
    
    
    Shares
    
    
    Amount
    
    
    Income
    
    
    Shares
    
    
    Amount(In thousands, except per share data)Net (loss) income
    
    $
    (64,917
    )
    
    
    
    
    
    
    
    
    
    $
    16,029
    
    
    
    
    
    
    
    
    
    
    $
    22,266Basic (loss) earnings per share:(Loss) income available to
common stockholders
    
    $
    (64,917
    )
    
    
    104,530,402
    
    
    $
    (0.62
    )
    
    $
    16,029
    
    
    
    105,447,910
    
    
    $
    0.15
    
    
    $
    22,266
    
    
    
    111,730,234
    
    
    $
    0.20Effect of dilutive common stock
equivalents(1)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    153,854
    
    
    
    
    
    
    
    
    
    
    
    281,830Diluted (loss) earnings per
share:(Loss) income available to
common stockholders
    
    $
    (64,917
    )
    
    
    104,530,402
    
    
    $
    (0.62
    )
    
    $
    16,029
    
    
    
    105,601,764
    
    
    $
    0.15
    
    
    $
    22,266
    
    
    
    112,012,064
    
    
    $
    0.20
 
 (1)
    
    During the six month period ended December 31, 2009 and years ended
June 30, 2009, 2008 and 2007, options to purchase shares of unvested
restricted stock of 6,530, 81,240, 68,971 and 18,378, respectively,
were outstanding, however were not included in the computation of
diluted EPS because their inclusion would be anti-dilutive. (19) Recent Accounting Pronouncements
      105




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106




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Financial Statement Schedules
  Exhibits
 3.1
    
    Certificate of Incorporation of Investors Bancorp, Inc.*3.2
    
    Bylaws of Investors Bancorp, Inc.*4
    
    Form of Common Stock Certificate of Investors Bancorp, Inc.*10.1
    
    Form of Employment Agreement*10.2
    
    Form of Change in Control Agreement*10.3
    
    Investors Savings Bank Director Retirement Plan*10.4
    
    Investors Savings Bank Supplemental ESOP and Retirement Plan*10.5
    
    Investors Savings Bank Executive Supplemental Retirement Wage Replacement Plan*10.6
    
    Investors Savings Bank Deferred Directors Fee Plan*10.7
    
    Investors Bancorp, Inc. Deferred Directors Fee Plan*10.8
    
    Executive Officer Annual Incentive Plan**10.9
    
    Agreement and Plan of Merger by and Between Investors Bancorp, Inc and American Bancorp of New Jersey, Inc.***14
    
    Code of Ethics****21
    
    Subsidiaries of Registrant*23.1
    
    Consent of Independent Registered Public Accounting Firm31.1
    
    Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 200231.2
    
    Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 200232
    
    Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002
 
 *
    
    Incorporated by reference to the Registration Statement on Form S-1
of Investors Bancorp, Inc. (file no. 333-125703), originally filed
with the Securities and Exchange Commission on June 10, 2005.**
    
    Incorporated by reference to Appendix A of the Companys definitive
proxy statement filed with the Securities and Exchange Commission on
September 26, 2008.***
    
    Incorporated by reference to Form 8-Ks originally filed with the
Securities and Exchange Commission on December 15, 2008 and March 18,
2009.****
    
    Available on our website www.isbnj.com




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##### Table of Contents



SIGNATURES
  INVESTORS BANCORP, INC.Date: March 1, 2010
    By:
    /s/  Kevin CummingsKevin Cummings
Chief Executive Officer and President
(Principal Executive Officer)
(Duly Authorized Representative)  Signatures
    
    Title
    
    Date/s/ Kevin Cummings

Kevin Cummings
    
    Chief Executive Officer and President
(Principal Executive Officer)
    
    March 1, 2010/s/ Thomas F. Splaine, Jr.

Thomas F. Splaine, Jr.
    
    Senior Vice President and Chief Financial Officer
(Principal Financial and Accounting Officer)
    
    March 1, 2010/s/ Doreen R. Byrnes

Doreen R. Byrnes
    
    Director
    
    March 1, 2010/s/ Robert M. Cashill

Robert M. Cashill
    
    Director, Chairman
    
    March 1, 2010/s/ Brian D. Dittenhafer

Brian D. Dittenhafer
    
    Director
    
    March 1, 2010/s/ Vincent D. Manahan, III

Vincent D. Manahan, III
    
    Director
    
    March 1, 2010/s/ Richard Petroski

Richard Petroski
    
    Director
    
    March 1, 2010/s/ Joseph H. Shepard III

Joseph H. Shepard III
    
    Director
    
    March 1, 2010/s/ Rose Sigler

Rose Sigler
    
    Director
    
    March 1, 2010/s/ Stephen J. Szabatin

Stephen J. Szabatin
    
    Director
    
    March 1, 2010/s/ James H. Ward III

James H. Ward III
    
    Director
    
    March 1, 2010