UNITED STATES
SECURITIES AND EXCHANGE COMMISSION 
Washington, D.C. 20549 FORM 10-Q (Mark One) x QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 For the quarterly period
ended March
31, 2006 or
 oTRANSITION REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period
from _______________ to _______________ Commission File Number: 1-5273-1 Sterling
  Bancorp(Exact
  name of registrant as specified in its charter)New
  York

13-2565216(State or other
  jurisdiction of

(I.R.S.
  Employerincorporation or
  organization)

Identification)650 Fifth Avenue, New
  York, N.Y.

10019-6108(Address of principal
  executive offices)

(Zip
  Code)212-757-3300(Registrants
  telephone number, including area code)N/A(Former
  name, former address and former fiscal year, if changed since last report) Indicate
by check mark whether the registrant (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.     x
Yeso No Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a
non-accelerated filer.  See definition of accelerated filer and large accelerated filer in Rule 12b-2 of the Exchange Act.   (Check one):
Large Accelerated Filero
                              Accelerated Filerx
                              Non-Accelerated Filero Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the
Exchange Act).oYes   xNo As of April 30, 2006 there were 18,779,551 shares of common stock,

$1.00 par value, outstanding.    STERLING BANCORP

PagePART I  FINANCIAL INFORMATIONItem 1.
Financial StatementsConsolidated
Financial Statements (Unaudited)
3Notes to
Consolidated Financial Statements
8Item 2.
Managements
Discussion and Analysis of Financial
  Condition and Results of OperationsOverview
12Income Statement
Analysis
13Balance Sheet
Analysis
15Capital
20Cautionary
Statement Regarding Forward-Looking
  Statements
20Average Balance
Sheets
22Rate/Volume
Analysis
23Regulatory
Capital and Ratios
24Item 3.
Quantitative and
Qualitative Disclosures About Market
  RiskAsset/Liability
Management
25Interest Rate
Sensitivity
30Item 4.
Controls and
Procedures
31PART II  OTHER
INFORMATIONItem 2.
Unregistered
Sales of Equity Securities and Use of
  Proceeds
32Item 6.
Exhibits
33SIGNATURES

34EXHIBIT
  INDEXExhibit
  11
Statement
  Re: Computation of Per Share Earnings
36Exhibit
  31.1
Certifications
  of the CEO and CFO pursuant to Exchange Act Rule 13a-14(a)
37Exhibit
  31.2
Certifications
  of the CEO and CFO pursuant to Exchange Act Rule 13a-14(a)
38Exhibit
  32
Certifications
  of the CEO and CFO required by Section 1350 of Chapter 63 of Title 18 of the
  U.S. Code
392

STERLING BANCORP AND SUBSIDIARIES
Consolidated Balance Sheets
(Unaudited)

March 31,

December
  31,2006

2005ASSETSCash and due from
banks

$
53,311,689

$
69,148,683Interest-bearing deposits with
other banks


1,646,956


1,212,227Securities available for sale
(at estimated fair value; pledged:
  $116,110,512 in 2006 and $111,233,053 in 2005)


170,963,779


201,259,112Securities held to maturity
(pledged: $307,564,946 in 2006 and
  $301,246,338 in 2005) (estimated fair value: $482,433,984 in 2006 and
  $504,514,084 in 2005)


497,166,317


514,039,476Total
investment securities


668,130,096


715,298,588Loans held for sale


36,920,902


40,977,538Loans held in portfolio, net of
unearned discounts


1,088,347,398


1,128,799,286Less allowance for loan
losses


16,405,193


16,517,330Loans, net


1,071,942,205


1,112,281,956Customers liability under
acceptances


159,870


589,667Excess cost over equity in net
assets of the banking subsidiary


21,158,440


21,158,440Premises and equipment,
net


10,695,606


10,903,870Other real estate


1,298,346


859,541Accrued interest
receivable


5,641,011


6,116,107Bank owned life
insurance


27,184,635


26,964,575Other assets


47,880,952


50,531,294$
1,945,970,708

$
2,056,042,486LIABILITIES AND
SHAREHOLDERS EQUITYDepositsDemand
deposits

$
483,001,128

$
510,883,966Savings, NOW
and money market deposits


404,914,020


436,173,517Time
deposits


525,092,399


501,268,657Total
deposits


1,413,007,547


1,448,326,140Securities sold under
agreements to repurchase - customers


63,179,113


61,067,073Securities sold under
agreements to repurchase - dealers


68,592,000


88,729,000Federal funds
purchased





55,000,000Commercial paper


43,092,355


38,191,016Short-term borrowings -
FHLB


55,900,000


35,000,000Short-term borrowings -
other


103,893


3,851,246Long-term borrowings -
FHLB


50,000,000


60,000,000Long-term borrowings -
subordinated debentures


25,774,000


25,774,000Total
borrowings


306,641,361


367,612,335Acceptances
outstanding


159,870


589,667Accrued expenses and other
liabilities


77,834,684


91,926,784Total
liabilities


1,797,643,462


1,908,454,926Shareholders
equityCommon stock, $1 par value.
Authorized 50,000,000 shares; issued
  21,085,665 and 21,066,916 shares, respectively


21,085,665


21,066,916Capital surplus


166,848,562


166,313,566Retained earnings


23,617,104


20,739,352Accumulated other comprehensive
loss, net of tax


(6,212,117
)

(5,229,620
)205,339,214


202,890,214LessCommon shares
in treasury at cost, 2,320,242 and 2,231,442 shares,
  respectively


57,011,968


55,280,647Unearned
compensation





22,007Total
shareholders equity


148,327,246


147,587,560$
1,945,970,708

$
2,056,042,486See Notes to Consolidated Financial Statements.

3

STERLING
BANCORP AND SUBSIDIARIES Consolidated
Statements of Income (Unaudited)

Three
  Months EndedMarch 31,2006

2005INTEREST INCOMELoans

$
22,025,242

$
18,376,415Investment
securitiesAvailable for
sale


2,201,786


2,501,644Held to
maturity


5,743,474


5,210,223Federal funds
sold


39,985


109,861Deposits with
other banks


30,081


6,183Total
interest income


30,040,568


26,204,326INTEREST EXPENSEDepositsSavings, NOW
and money market


1,782,920


629,257Time


4,460,851


2,822,338Securities
sold under agreements to repurchase-
customers


694,848


337,035-
dealers


983,988


248,612Federal funds
purchased


135,140


20,782Commercial
paper


404,601


160,066Short-term
borrowings - FHLB


193,168


Short-term
borrowings - other


10,412


5,003Long-term
borrowings - FHLB


586,351


955,516Long-term
borrowings - subordinated debt


523,438


523,437Total
interest expense


9,775,717


5,702,046Net interest income


20,264,851


20,502,280Provision for loan
losses


2,565,000


2,648,500Net interest income after
provision for loan losses


17,699,851


17,853,780NONINTEREST INCOMECustomer
related service charges and fees


3,640,089


3,401,184Mortgage
banking income


2,216,552


3,875,847Trust
fees


151,722


172,278Bank owned
life insurance income


220,060


250,014Securities
(losses) /gains


(459,497
)

196,680Other
income


113,585


100,197Total noninterest income


5,882,511


7,996,200NONINTEREST EXPENSESSalaries


8,305,809


8,156,603Employee
benefits


2,956,607


1,750,205Total
personnel expense


11,262,416


9,906,808Occupancy and
equipment expenses, net


2,316,168


2,078,840Advertising
and marketing


1,034,198


1,116,323Professional
fees


1,923,740


1,531,179Communications


431,714


383,281Other
expenses


2,399,586


1,959,997Total noninterest expenses


19,367,822


16,976,428Income before income
taxes


4,214,540


8,873,552Provision for income
taxes


(2,225,593
)

3,106,829Net income

$
6,440,133

$
5,766,723Average number of common shares
outstandingBasic


18,783,299


19,163,777Diluted


19,345,614


19,820,240Earnings per average common
shareBasic

$
0.34

$
0.30Diluted


0.33


0.29Dividends per common
share


0.19


0.18See Notes to Consolidated Financial Statements.

4

STERLING
BANCORP AND SUBSIDIARIES
Consolidated Statements of Comprehensive Income
(Unaudited)

Three
  Months EndedMarch 31,2006

2005Net Income

$
6,440,133

$
5,766,723Other comprehensive income, net
of tax:Unrealized
holding losses arising during the period


(1,234,347
)

(2,236,146
)Reclassification adjustment for losses /(gains) included in net income


251,850


(106,404
)Comprehensive income

$
5,457,636

$
3,424,173See Notes to Consolidated Financial
Statements.

5

STERLING BANCORP AND SUBSIDIARIES
Consolidated Statements of Changes in Shareholders Equity
(Unaudited)

Three
  Months Ended
  March 31,2006

2005Common StockBalance at January 1

$
21,066,916

$
19,880,521Common shares issued under
stock incentive
  plan


18,749


64,487Balance at March 31

$
21,085,665

$
19,945,008Capital SurplusBalance at January 1

$
166,313,566

$
145,310,745Common shares issued under
stock incentive
  plan and related tax benefits


534,996


952,292Balance at March 31

$
166,848,562

$
146,263,037Retained EarningsBalance at January 1

$
20,739,352

$
28,664,568Net Income


6,440,133


5,766,723Cash dividends paid - common
shares


(3,562,381
)

(3,458,540
)Balance at March 31

$
23,617,104

$
30,972,751Accumulated Other Comprehensive
IncomeBalance at January 1

$
(5,229,620
)
$
(1,921,060
)Unrealized holding losses
arising during
  the period:Before tax


(2,040,054
)

(4,133,362
)Tax effect


805,707


1,897,216Net of tax


(1,234,347
)

(2,236,146
)Reclassification adjustment for
  losses/(gains) included in net income:Before tax


459,497


(196,680
)Tax effect


(207,647
)

90,276Net of tax


251,850


(106,404
)Balance at March 31

$
(6,212,117
)
$
(4,263,610
)Treasury StockBalance at January 1

$
(55,280,647
)
$
(42,939,969
)Purchase of common
shares


(1,525,999
)

Surrender of shares issued
under incentive
  compensation plan


(205,322
)

(249,038
)Balance at March 31

$
(57,011,968
)
$
(43,189,007
)Unearned CompensationBalance at January 1

$
(22,007
)
$
(291,212
)Amortization of unearned
compensation


22,007


71,169Balance at March 31

$


$
(220,043
)Total Shareholders
EquityBalance at January 1

$
147,587,560

$
148,703,593Net changes during the
period


739,686


804,543Balance at March 31

$
148,327,246

$
149,508,136See Notes to Consolidated Financial
Statements.

6

STERLING BANCORP AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(Unaudited)

Three
  Months Ended
  March 31,2006

2005Operating ActivitiesNet Income

$
6,440,133

$
5,766,723Adjustments to reconcile net
income to net
  cash provided by (used in) operating activities:Provision for loan
losses


2,565,000


2,648,500Depreciation and amortization
of premises
  and equipment


523,763


454,454Securities losses
(gains)


459,497


(196,680
)Income from bank owned life
insurance


(220,060
)

(250,014
)Deferred income tax provision
(benefit)


2,066,068


(189,692
)Proceeds from sale of
loans


149,510,690


140,503,978Gains on sales of loans,
net


(2,216,552
)

(3,875,847
)Originations of loans held for
sale


(143,237,502
)

(126,184,313
)Amortization of unearned
compensation


22,007


71,169Amortization of premiums on
securities


166,781


266,241Accretion of discounts on
securities


(108,547
)

(148,267
)Decrease (Increase) in accrued
interest
  receivable


475,096


(382,324
)Decrease in accrued expenses
and other
  liabilities


(14,092,100
)

(10,624,338
)Decrease (Increase) in other
assets


1,222,432


(2,415,307
)Other, net


111,857


(636,733
)Net cash provided by operating
activities


3,688,563


4,807,550Investing ActivitiesPurchase of premises and
equipment


(315,499
)

(506,702
)Net increase in
interest-bearing deposits
  with other banks


(434,729
)

(2,759,760
)Net increase in Federal funds
sold





(35,000,000
)Net decrease in loans held in
portfolio


37,774,751


43,483,901(Increase) Decrease in other
real estate


(438,805
)

232,238Proceeds from prepayments,
redemptions or
  maturities of securities - held to maturity


16,953,372


22,878,255Purchases of securities - held
to maturity


(115,870
)

(63,978,499
)Proceeds from sales of
securities -
  available for sale


24,538,500


2,932,250Proceeds from prepayments,
redemptions or
  maturities of securities - available for sale


7,130,721


16,658,176Purchases of securities -
available for
  sale


(3,506,991
)

(8,361,260
)Net cash provided by (used in)
investing
  activities


81,585,450


(24,421,401
)Financing ActivitiesNet (decrease) increase in
deposits


(35,318,593
)

44,731,374Net decrease in
borrowings


(60,970,974
)

(4,949,461
)Purchase of treasury
stock


(1,525,999
)

Proceeds from exercise of stock
options


266,940


1,016,779Cash dividends paid on common
stock


(3,562,381
)

(3,458,540
)Net cash (used in) provided by
financing
  activities


(101,111,007
)

37,340,152Net (decrease) increase in cash
and due
  from banks


(15,836,994
)

17,726,301Cash and due from banks -
beginning of
  period


69,148,683


48,842,418Cash and due from banks - end
of period

$
53,311,689

$
66,568,719Supplemental
disclosures:Interest paid

$
10,079,286

$
5,584,920Income taxes paid


1,767,655


7,756,600See Notes to Consolidated Financial
Statements.

7

STERLING BANCORP AND
SUBSIDIARIESNotes to Consolidated Financial Statements
(Unaudited)

1.
The consolidated financial statements include the accounts of
  Sterling Bancorp (the parent company) and its subsidiaries, principally
  Sterling National Bank and its subsidiaries (the bank), after elimination
  of material intercompany transactions. The term the Company refers to
  Sterling Bancorp and its subsidiaries. The consolidated financial statements
  as of and for the interim periods ended March 31, 2006 and 2005 are
  unaudited; however, in the opinion of management, all adjustments, consisting
  of normal recurring accruals, necessary for a fair presentation of such
  periods have been made. Certain reclassifications have been made to the 2005
  consolidated financial statements to conform to the current presentation. The
  interim consolidated financial statements should be read in conjunction with
  the Companys annual report on Form 10-K for the year ended December 31,
  2005. The Company effected a 5% stock dividend on December 12, 2005.
  Fractional shares were cashed-out and payments were made to shareholders in
  lieu of fractional shares. All capital and share amounts as well as basic and
  diluted average number of shares outstanding and earnings per average common
  share information for all prior reporting periods have been restated to
  reflect the effect of the stock dividend.2.
At March 31, 2006, the Company has a stock-based employee
  compensation plan, which is described more fully in Note 1 and Note 14 to the
  consolidated financial statements in the Companys annual report on Form 10-K
  for the year ended December 31, 2005. Prior to January 1, 2006, the Company
  accounted for this plan under the recognition and measurement principles of
  Accounting Principles Board (APB) Opinion No. 25, Accounting for Stock Issued to Employees,
  and related Interpretations. No stock-based employee compensation cost was
  reflected in net income, as all options granted under those plans had an
  exercise price equal to the market value of the underlying common stock on
  the date of grant. In accordance with Statement of Financial Accounting
  Standards (SFAS) No. 148, the following table illustrates the effect
  on net income and earnings per average common share if the Company had
  applied the fair value recognition provisions of SFAS No. 123, Accounting for Stock-Based Compensation,
  to the stock-based employee compensation plans.Three Months Ended March 31,

2005Net income available for
  common shareholders

$
5,766,723Deduct: Total stock-based
  employee compensation expense determined under fair value based method for
  all awards, net of related tax effects


(61,395
)Pro forma, net income

$
5,705,328Earnings per average common
  share:Basic- as reported

$
0.30Basic- pro forma


0.30Diluted- as reported


0.29Diluted- pro forma


0.29As of January 1, 2006, the Company adopted SFAS No. 123R, Share-Based
Payment, which among other
provisions, eliminated the ability to account for stock-based compensation
using APB 25 and requires that such transactions be recognized as compensation
cost in the income statement for awards expected to be vested based on their
fair values on the measurement date, which is generally the date of the grant.
There are no outstanding stock-based awards for which compensation expense
would have been recognized under the provisions of SFAS No. 123R.8

STERLING BANCORP AND
SUBSIDIARIES
Notes to Consolidated Financial Statements
(Unaudited)

3.
The major
  components of domestic loans held for sale and loans held in portfolio are as
  follows:March 31,2006

2005Loans held for saleReal estate-residential
  mortgage

$
36,920,902

$
26,614,855Loans held in
portfolioCommercial and
industrial

$
597,143,536

$
556,229,669Lease financing


236,788,980


186,476,009Real estate-residential
  mortgage


144,790,296


126,004,021Real estate-commercial
  mortgage


109,719,611


115,513,907Real
estate-construction


2,309,103


2,313,541Installment


14,189,315


13,372,051Loans to depository
  institutions


15,000,000


Loans held in portfolio,
  gross


1,119,940,841


999,909,198Less unearned
discounts


31,593,443


23,301,243Loans held in portfolio, net
  of unearned discounts

$
1,088,347,398

$
976,607,9554.
SFAS No.
  131, Disclosures about Segments of an
  Enterprise and Related Information, established standards for the
  way that public business enterprises
  report and disclose selected
  information about operating segments in interim financial statements
  provided to stockholders.The Company provides a broad range of financial products and
  services, including commercial loans, asset-based financing, factoring and
  accounts receivable management services, trade financing, equipment leasing,
  corporate and consumer deposit services, commercial and residential mortgage
  lending and brokerage, trust and estate administration and investment
  management services. The Companys primary source of earnings is net interest
  income, which represents the difference between interest earned
  on interest-earning assets and the interest incurred on interest-bearing
  liabilities. The Companys 2006 year-to-date average interest-earning assets
  were 60.4% loans (corporate lending was 40.6% and real estate lending was
  17.4% of total loans, respectively) and 39.3% investment securities and money
  market investments. There are no industry concentrations exceeding 10% of
  loans, gross, in the corporate lending segment. Approximately 67% of loans
  are to borrowers located in the metropolitan New York area. In order to
  comply with the provisions of SFAS No. 131, the Company has determined that
  it has three reportable operating segments: corporate lending, real estate
  lending and company-wide treasury.9

STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements
(Unaudited)

The following
tables provide certain information regarding the Companys operating segments
for the three-month periods ended March 31, 2006 and 2005:

Corporate
  Lending

Real Estate
  Lending

Company-wide
  Treasury

TotalsThree Months Ended March 31,
2006Net interest income

$
9,981,955

$
5,424,633

$
4,586,401

$
19,992,989Noninterest income


3,249,126


2,315,471


(161,649
)

5,402,948Depreciation and
amortization


107,190


100,731


614


208,535Segment income before
taxes


4,751,320


2,923,638


4,294,289


11,969,247Segment assets


802,879,075


342,949,424


770,803,911


1,916,632,410Three Months Ended March 31,
2005Net interest income

$
9,715,366

$
4,854,012

$
5,719,571

$
20,288,949Noninterest income


2,963,485


3,937,645


524,293


7,425,423Depreciation and
amortization


92,809


88,960


606


182,375Segment income before
taxes


4,891,636


5,099,503


6,073,417


16,064,556Segment assets


704,110,583


317,412,358


857,394,953


1,878,917,894The following
table sets forth reconciliations of net interest income, noninterest income,
profits and assets of reportable operating segments to the Companys
consolidated totals:

Three
  Months Ended March 31,2006

2005Net interest income:Total for
reportable operating segments

$
19,992,989

$
20,288,949Other
[1]


271,862


213,331Consolidated net interest
income

$
20,264,851

$
20,502,280Noninterest income:Total for
reportable operating segments

$
5,402,948

$
7,425,423Other
[1]


479,563


570,777Consolidated noninterest
income

$
5,882,511

$
7,996,200Income before taxes:Total for
reportable operating segments

$
11,969,247

$
16,064,556Other
[1]


(7,754,707
)

(7,191,004
)Consolidated income before
income taxes

$
4,214,540

$
8,873,552Assets:Total for
reportable operating segments

$
1,916,632,410

$
1,878,917,894Other
[1]


29,338,298


22,334,362Consolidated assets

$
1,945,970,708

$
1,901,252,256[1]
Represents operations not considered to be a reportable segment and/or general
operating expenses of the Company.

10

STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements
(Unaudited)

5.
The following
  information is provided in connection with the sales of available for sale
  securities:Three Months Ended March 31,

2006

2005Proceeds

$
24,538,500

$
2,932,250Gross
Gains





196,680Gross
Losses


459,497


6.
The
  following table sets forth components of net periodic benefit cost for the
  Companys noncontributory defined benefit pension plan and unfunded
  supplemental retirement plan:Three Months Ended March 31,

2006

2005COMPONENTS OF NET PERIODIC BENEFIT COSTService cost

$
467,499

$
403,843Interest cost


616,900


509,493Expected return on plan assets


(542,976
)

(442,549
)Amortization of prior service cost


19,691


19,116Recognized actuarial loss


336,918


207,354Net periodic benefit cost

$
898,032

$
697,257The Company previously disclosed in its financial statements for the
  year ended December 31,2005, that it expected to contribute approximately
  $1,000,000 to the defined benefit pension plan in 2006. No contribution has
  been made as of March 31, 2006.7.
In February 2006, the Financial Accounting Standards Board (FASB)
issued SFAS No. 155, Accounting for Certain Hybrid Financial Instruments,(SFAS No. 155). SFAS No. 155 amends SFAS No. 133, Accounting for
Derivative Instruments and Hedging Activities, and SFAS No. 140,Accounting for Transfers and Servicing of Financial Assets and Extinguishments
of Liabilities (SFAS No. 140). SFAS No. 155 (1) permits fair
value remeasurement for any hybrid financial instrument that contains an
embedded derivative that otherwise would require bifurcation, (2) clarifies
which interest-only strips and principal-only strips are not subject to the
requirements of SFAS No. 133, (3) establishes a requirement to evaluate interests
in securitized financial assets to identify interests that are freestanding
derivatives or that are hybrid financial instruments that contain an embedded
derivative requiring bifurcation, (4) clarifies that concentrations of credit
risk in the form of subordination are not embedded derivatives, and (5) amends
SFAS No. 140 to eliminate the prohibition on a qualifying special purpose entity
from holding a derivative financial instrument that pertains to a beneficial
interest other than another derivative financial instrument. This statement is
effective for all financial instruments acquired or issued after the beginning
of the Companys first fiscal year that begins after September 15, 2006.
The Company is still in the process of analyzing the impact of SFAS No. 155 on
its financial statements.In March 2006, FASB issued SFAS No. 156, Accounting for Servicing of Financial
Assets (SFAS No. 156). This statement amends SFAS No. 140 with
respect to the accounting for separately recognized servicing assets and
servicing liabilities. SFAS No. 156 requires companies to recognize a servicing
asset or servicing liability each time it undertakes an obligation to service a
financial asset by entering into a servicing contract. The statement permits a
company to choose either the amortized cost method or fair value measurement
method for each class of separately recognized servicing assets or servicing
liabilities. This statement is effective as of the beginning of the Companys
first fiscal year that begins after September 15, 2006. The Company is still in the process
of analyzing the impact of SFAS No. 156 on its financial statements.11

ITEM 2.
MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
  RESULTS OF OPERATIONSThe following commentary presents managements discussion and
  analysis of the financial condition and results of operations of Sterling
  Bancorp (the parent company), a financial holding company under the
  Gramm-Leach-Bliley Act of 1999, and its subsidiaries, principally Sterling
  National Bank (the bank). Throughout this discussion and analysis, the term
  the Company refers to Sterling Bancorp and its subsidiaries. This
  discussion and analysis should be read in conjunction with the consolidated
  financial statements and supplemental data contained elsewhere in this
  quarterly report and the Companys annual report on Form 10-K for the year
  ended December 31, 2005. Certain reclassifications have been made to prior
  years financial data to conform to current financial statement presentations
  as well as to reflect the effect of the 5% stock dividend effected on
  December 12, 2005.OVERVIEWThe Company provides a broad range of financial products and
  services, including business and consumer loans, commercial and residential
  mortgage lending and brokerage, asset-based financing, factoring/accounts
  receivable management services, deposit services, trade financing, equipment
  leasing, trust and estate administration, and investment management services.
  The Company has operations in the metropolitan New York area, New Jersey,
  Virginia and North Carolina and conducts business throughout the United
  States. The general state of the U.S. economy and, in particular, economic
  and market conditions in the metropolitan New York area have a significant
  impact on loan demand, the ability of borrowers to repay these loans and the
  value of any collateral securing these loans and may also affect deposit
  levels. Accordingly, future general economic conditions are a key uncertainty
  that management expects will materially affect the Companys results of
  operations.For the three months ended March 31, 2006, the banks average earning
  assets represented approximately 96.3% of the Companys average earning
  assets. Loans represented 58.9% and investment securities represented 40.8%
  of the banks average earning assets for the first quarter of 2006.The Companys primary source of earnings is net interest income, and
  its principal market risk exposure is interest rate risk. The Company is not
  able to predict market interest rate fluctuations, and its asset-liability
  management strategy may not prevent interest rate changes from having a
  material adverse effect on the Companys results of operations and financial
  condition.Although management endeavors to minimize the credit risk inherent in
  the Companys loan portfolio, it must necessarily make various assumptions
  and judgments about the collectibility of the loan portfolio based on its
  experience and evaluation of economic conditions. If such assumptions or
  judgments prove to be incorrect, the current allowance for loan losses may
  not be sufficient to cover loan losses and additions to the allowance may be
  necessary, which would have a negative impact on net income.12

There is intense competition in all areas in which the Company
  conducts its business. The Company competes with banks and other financial
  institutions, including savings and loan associations, savings banks, finance
  companies and credit unions. Many of these competitors have substantially
  greater resources and lending limits and provide a wider array of banking
  services. To a limited extent, the Company also competes with other providers
  of financial services, such as money market mutual funds, brokerage firms,
  consumer finance companies and insurance companies. Competition is based on a
  number of factors, including prices, interest rates, service, availability of
  products, and geographic location.The Company regularly evaluates acquisition opportunities and
  conducts due diligence activities in connection with possible acquisitions.
  As a result, acquisition discussions, and in some cases negotiations,
  regularly take place and future acquisitions could occur.INCOME STATEMENT ANALYSISNet interest income, which represents the difference between interest
  earned on interest-earning assets and interest incurred on interest-bearing
  liabilities, is the Companys primary source of earnings. Net interest income can be affected by changes in market
  interest rates as well as the level and composition of assets, liabilities
  and shareholders equity. Net interest spread is the difference between the
  average rate earned, on a tax-equivalent basis, on interest-earning assets
  and the average rate paid on interest-bearing liabilities. The net yield on
  interest-earning assets (net interest margin) is calculated by dividing
  tax-equivalent net interest income by average interest-earnings assets.
  Generally, the net interest margin will exceed the net interest spread
  because a portion of interest-earning assets are funded by various
  noninterest-bearing sources, principally noninterest-bearing deposits and
  shareholders equity. The increases (decreases) in the components of interest
  income and interest expense, expressed in terms of fluctuation in average
  volume and rate, are provided in the Rate/Volume Analysis shown on Page 23.
  Information as to the components of interest income and interest expense and
  average rates is provided in the Average Balance Sheets shown on page 22.Comparison of the Three Months Ended March
  31, 2006 and 2005The Company reported net income for the three months ended March 31,
  2006 of $6.4 million, representing $0.33 per share, calculated on a diluted
  basis, compared to $5.8 million, or $0.29 per share calculated on a diluted
  basis, for the first quarter of 2005. This increase reflects a lower
  provision for income taxes and higher interest income which were partially
  offset by increases in interest and noninterest expenses coupled with a
  decrease in noninterest income.13

Net Interest IncomeNet interest income on a tax-equivalent basis, was $20.5 million for
  the first quarter of 2006 compared to $20.7 million for the 2005 period, due
  to higher rates paid on interest-bearing deposit balances and borrowings
  partially offset by higher earning assets outstanding coupled with higher
  average yield on loans. The net interest margin, on a tax-equivalent basis,
  was 4.58% for the first three months of 2006 compared to 4.91% for the 2005
  period. The decrease in the net interest margin was primarily the result of
  the impact of the flattening of the yield curve, the higher interest rate
  environment in 2006, and minimal growth of noninterest-bearing demand
  deposits partially offset by the impact of higher average loan outstandings.Total interest income, on a tax-equivalent basis, aggregated $30.2
  million for the first three months of 2006, up from $26.4 million for the
  2005 period. The tax-equivalent yield on interest-earning assets was 6.85%
  for the first quarter of 2006 compared to 6.32% for the 2005 period.Interest earned on the loan portfolio amounted to $22.0 million for
  the first three months of 2006, up $3.6 million from a year ago. Average loan
  balances amounted to $1,089.5 million, an increase of $96.5 million from an
  average of $993.0 million in the prior year period. The increase in average
  loans (across virtually all segments of the Companys loan portfolio), primarily
  due to the Companys business development activities and the ongoing
  consolidation of banks in the Companys marketing area, accounted for $1.9
  million of the $3.6 million increase in interest earned on loans. The
  increase in the yield on the domestic loan portfolio to 8.42% for the first
  quarter of 2006 from 7.72% for the 2005 period was primarily attributable to
  the mix of average outstanding balances among the components of the loan
  portfolio and the higher interest rate environment in 2006.Interest earned on the securities portfolio, on a tax-equivalent
  basis, increased to $8.2 million for the first quarter of 2006 from $7.9
  million in the prior year period. Average outstandings increased to $708.7
  million (39.3% of average earning assets) for the first quarter of 2006 from
  $692.6 million (40.6% of average earning assets) in the prior year period.
  The average life of the securities portfolio was approximately 4.6 years at
  March 31, 2006 compared to 4.3 years at March 31, 2005, reflecting the impact
  of purchases primarily during the second and fourth quarters of 2005. In
  addition, approximately $25,000,000 of Federal Home Loan Bank and Federal
  Farm Credit Bank securities with an average life of less than one year and a
  weighted average yield of less than 3.00% were sold during the 2006 quarter
  providing funding for the acquisition of higher yielding loans.Total interest expense increased by $4.1 million for the first three
  months of 2006 from $5.7 million for the 2005 period, primarily due to higher
  rates paid for interest-bearing deposits and for borrowed funds and higher
  average balances for interest-bearing deposits and for borrowed funds.Interest expense on deposits increased to $6.2 million for the first
  quarter of 2006 from $3.5 million for the 2005 period due to an increase in
  average balances, primarily for NOW, money market and time deposits, coupled
  with an14

increase in the cost of those funds. Average interest-bearing deposit
  balances increased to $975.8 million for the first quarter of 2006 from
  $894.2 million in the 2005 period primarily as a result of the Companys
  branching initiatives and other business development activities. Average rate
  paid on interest-bearing deposits was 2.60% which was 103 basis points higher
  than the prior year period. The increase in average cost of deposits reflects
  the higher interest rate environment during 2006.Interest expense on borrowings increased to $3.5 million for the
  first quarter of 2006 from $2.3 million for the 2005 period due to an
  increase in the cost of those funds coupled with higher average balances. The
  average rate paid in borrowings was 4.51% which was 135 basis points higher
  than the prior year period. The increase in average cost of borrowings
  reflects the higher interest rate environment during 2006. Average borrowing
  balances increased to $316.8 million for the first quarter of 2006 from
  $286.5 million on the 2005 period.Noninterest IncomeNoninterest income decreased to $5.9 million for the first quarter of
  2006 from $8.0 million in the 2005 period, primarily due to lower mortgage
  banking income and higher losses on sales of available for sale securities.
  Partially offsetting these decreases were higher customer related service
  charges and fees for deposit services. Despite an increase of 5.4% in
  residential loan volume closed in the first quarter, the Companys mortgage
  banking income continued to show the impact of yield compression in the
  secondary mortgage market.Noninterest ExpensesNoninterest expenses increased $2.4 million for the first quarter of
  2006 when compared to the 2005 period. The increase was primarily due to
  higher employee benefit expenses, primarily due to timing differences in
  connection with insurance costs and payroll taxes, and higher professional
  fees related to compliance efforts.Provision for Income TaxesThe provision for income taxes decreased by $5.3 million to a credit
  of $2.2 million for the first quarter of 2006 from an expense of $3.1 million
  for the 2005 period. The decrease was due to a $3.7 million reversal of
  reserves for state and local taxes, net of federal tax effect, as the result
  of the resolution of certain state tax issues and to the lower level of
  pre-tax income.BALANCE SHEET ANALYSISSecuritiesThe Companys securities portfolios are comprised principally of
  mortgage-backed securities of U.S. government corporations and government
  sponsored enterprises, and obligations of state and political institutions,
  along with other debt and equity securities. At March 31, 2006, the Companys
  portfolio of securities totaled $668.1 million, of which mortgage-backed
  securities and collateralized mortgage obligations of U.S. government
  corporations and government sponsored enterprises having an average life of
  approximately 5.0 years amounted to $583.0 million. The Company has the
  intent and ability to hold to maturity securities classified as held to
  maturity. These securities are carried at cost, adjusted15

for
amortization of premiums and accretion of discounts.  The gross unrealized gains and losses on held to maturity
securities were $0.7 million and $15.4 million, respectively.  Securities classified as available for
sale may be sold in the future, prior to maturity.  These securities are carried at market value.  Net aggregate unrealized
gains or losses on
these securities are included in a valuation allowance account and are shown
net of taxes, as a component of shareholders equity.  Given the generally high credit quality of the portfolio,
management expects to realize all of its investment upon the maturity of such
instruments and thus believes that any market value impairment is
temporary.  Available for sale
securities included gross unrealized gains of $0.4 million and gross unrealized
losses of $6.2 million.

The following
table presents information regarding securities available for sale:

March 31,
  2006
  
  Gross
  Amortized
  Cost
  
  Gross
  Unrealized
  Gains
  
  Gross
  Unrealized
  Losses
  
  Market
  ValueMortgage-backed
securitiesCMOs (Federal National
Mortgage
  Corporation)
  
  $
  9,089,388
  
  $
  
  
  $
  638,923
  
  $
  8,450,465CMOs (Federal Home Loan
Mortgage Company)
  
  
  23,568,021
  
  
  
  
  
  1,386,908
  
  
  22,181,113Federal National Mortgage
Association
  
  
  50,736,546
  
  
  27,528
  
  
  1,928,035
  
  
  48,836,039Federal Home Loan Mortgage
Company
  
  
  49,026,196
  
  
  6,797
  
  
  1,989,048
  
  
  47,043,945Government National Mortgage
Association
  
  
  5,160,277
  
  
  147,164
  
  
  5,896
  
  
  5,301,545Total mortgage-backed
securities
  
  
  137,580,428
  
  
  181,489
  
  
  5,948,810
  
  
  131,813,107Obligations of state and
political
  institutions
  
  
  31,317,496
  
  
  186,324
  
  
  248,832
  
  
  31,254,988Federal Reserve Bank
stock
  
  
  1,130,700
  
  
  
  
  
  
  
  
  1,130,700Federal Home Loan Bank
stock
  
  
  6,440,800
  
  
  
  
  
  
  
  
  6,440,800Other securities
  
  
  304,442
  
  
  19,742
  
  
  
  
  
  324,184Total
  
  $
  176,773,866
  
  $
  387,555
  
  $
  6,197,642
  
  $
  170,963,77916

The following
table presents information regarding securities held to maturity:

Gross

Gross

EstimatedCarrying

Unrealized

Unrealized

MarketMarch 31,
  2006

Value

Gains

Losses

ValueMortgage-backed securitiesCMOs (Federal
National Mortgage
  Corporation)

$
13,800,082

$


$
669,391

$
13,130,691CMOs (Federal
Home Loan Mortgage Company)


24,862,038





1,287,469


23,574,569Federal
National Mortgage Association


239,315,098


306,693


6,909,426


232,712,365Federal Home
Loan Mortgage Company


160,288,248


90,032


5,818,858


154,559,422Government
National Mortgage Association


12,916,220


301,468


885


13,216,803Total
mortgage-backed securities


451,181,686


698,193


14,686,029


437,193,850Federal Home
Loan Bank


24,984,631





303,382


24,681,249Federal Farm
Credit Bank


20,000,000





437,500


19,562,500Total
obligations of U.S. government
  corporations and agencies


496,166,317


698,193


15,426,911


481,437,599Debt
securities issued by foreign
  governments


1,000,000





3,615


996,385Total

$
497,166,317

$
698,193

$
15,430,526

$
482,433,984Loan Portfolio

A management
objective is to maintain the quality of the loan portfolio. The Company seeks
to achieve this objective by maintaining rigorous underwriting standards
coupled with regular evaluation of the creditworthiness of and the designation
of lending limits for each borrower. The portfolio strategies include seeking
industry and loan size diversification in order to minimize credit exposure and
originating loans in markets with which the Company is familiar.

The Companys
commercial and industrial loan portfolio represents approximately 53% of all
loans. Loans in this category are typically made to small and medium-sized
businesses and range between $25,000 and $10 million. The Companys real estate
mortgage portfolio, which represents approximately 26% of all loans, is secured
by mortgages on real property located principally in the states of New York,
New Jersey, Virginia and North Carolina. The Companys leasing portfolio, which
consists of finance leases for various types of business equipment, represents
approximately 18% of all loans. Sources of repayment are from the borrowers operating profits,
cash flows and liquidation of pledged collateral. Based on underwriting
standards, loans may be secured in whole or in part by collateral such as
liquid assets, accounts receivable, equipment, inventory, and real property.
The collateral securing any loan or lease may depend on the type of loan or
lease and may vary in value based on market conditions.

17

The following table sets forth the composition of the Companys loans
held for sale and loans held in portfolio:

March 31,2006

2005($ in thousands)% of





% ofBalances




Total



Balances

TotalDomesticCommercial and
industrial

$
596,729



53.0
%

$
555,981


55.5
%Equipment
lease financing


205,610



18.3



163,425


16.3Real estate -
residential
  mortgage


181,711



16.1



152,619


15.2Real estate-
commercial
  mortgage


109,720



9.8



115,514


11.5Real estate -
construction


2,309



0.2



2,314


0.2Installment -
individuals


14,189



1.3



13,370


1.3Loans to
depository
  institutions


15,000



1.3






Loans, net of
unearned
  discounts

$
1,125,268



100.0
%

$
1,003,223


100.0
%Asset Quality

Intrinsic to
the lending process is the possibility of loss. In times of economic slowdown,
the risk of loss inherent in the Companys portfolio of loans may increase.
While management endeavors to minimize this risk, it recognizes that loan
losses will occur and that the amount of these losses will fluctuate depending
on the risk characteristics of the loan portfolio which in turn depend on
current and expected economic conditions, the financial condition of borrowers,
the realization of collateral, and the credit management process.

Management
views the allowance for loan losses as a critical accounting policy due to its
subjectivity. The allowance for loan losses is maintained through the provision
for loan losses, which is a charge to operating earnings. The adequacy of the
provision and the resulting allowance for loan losses is determined by a
management evaluation process of the loan portfolio, including identification
and review of individual problem situations that may affect the borrowers
ability to repay, review of overall portfolio quality through an analysis of
current charge-offs, delinquency and nonperforming loan data, estimates of the
value of any underlying collateral, an assessment of current and expected
economic conditions and changes in the size and character of the loan
portfolio. Other data utilized by management in determining the adequacy of the
allowance for loan losses includes, but is not limited to, the results of
regulatory reviews, the amount of, trend of and/or borrower characteristics on
loans that are identified as requiring special attention as part of the credit
review process, and peer group comparisons. The impact of this other data might
result in an allowance which will be greater than that indicated by the
evaluation process previously described. The allowance reflects managements
evaluation both of loans presenting identified loss potential and of the risk
inherent in various components of the loan portfolio, including loans
identified as impaired as required by SFAS No. 114. Thus, an increase in the
size of the portfolio or in any of its components could necessitate an increase
in the allowance even though there may not be a decline in credit quality or an
increase in potential problem loans. A significant change in any of the
evaluation factors described above could result in future additions to the
allowance. At March 31, 2006, the ratio of the allowance to loans held in
portfolio, net of

18

unearned
discounts, was 1.51% and the allowance was $16.4 million. At such date, the
Companys nonaccrual loans amounted to $4.3 million; $0.4 million of such loans
was judged to be impaired within the scope of SFAS No. 114. Loans 90 days past
due and still accruing amounted to $0.9 million. Based on the foregoing, as
well as managements judgment as to the current risks inherent in loans held in
portfolio, the Companys allowance for loan losses was deemed adequate to
absorb all reasonably anticipated losses on specifically known and other
possible credit risks associated with the portfolio as of March 31, 2006. Net
losses within loans held in portfolio are not statistically predictable and
changes in conditions in the next twelve months could result in future provisions
for loan losses varying from the level taken in the first quarter of 2006.
Potential problem loans, which are loans that are currently performing under
present loan repayment terms but where known information about possible credit
problems of borrowers causes management to have serious doubts as to the
ability of the borrowers to continue to comply with the present repayment
terms, aggregated $2.0 million at March 31, 2006.

Deposits

A significant source of funds for the Company continues to be deposits,
consisting of demand (noninterest-bearing), NOW, savings, money market and time
deposits (principally certificates of deposit).

The following table provides certain information with respect to the
Companys deposits:

March 31,2006

2005($ in thousands)% of



% ofBalances

Total

Balances

TotalDomesticDemand

$
483,001


34.2
%
$
468,714


33.7
%NOW


172,621


12.2


152,607


11.0Savings


23,803


1.7


28,864


2.1Money
market


208,490


14.8


251,105


18.1Time
deposits


522,068


36.9


484,283


34.9Total domestic
deposits


1,409,983


99.8


1,385,573


99.8ForeignTime
deposits


3,025


0.2


3,010


0.2Total
deposits

$
1,413,008


100.0
%
$
1,388,583


100.0
%Fluctuations
of balances in total or among categories at any date may occur based on the
Companys mix of assets and liabilities as well as on customers balance sheet
strategies. Historically, however, average balances for deposits have been
relatively stable. Information regarding these average balances is presented on
page 22.

19

CAPITAL

The Company
and the bank are subject to risk-based capital regulations which quantitatively
measure capital against risk-weighted assets, including certain off-balance
sheet items. These regulations define the elements of the Tier 1 and Tier 2
components of Total Capital and establish minimum ratios of 4% for Tier 1
capital and 8% for Total Capital for capital adequacy purposes. Supplementing
these regulations is a leverage requirement. This requirement establishes a
minimum leverage ratio (at least 3% or 4%, depending upon an institutions
regulatory status) which is calculated by dividing Tier 1 capital by adjusted
quarterly average assets (after deducting goodwill). Information regarding the
Companys and the banks risk-based capital is presented on page 24. In
addition, the bank is subject to the Federal Deposit Insurance Corporation
Improvement Act of 1991 (FDICIA) which imposes a number of mandatory
supervisory measures. Among other matters, FDICIA established five capital
categories, ranging from well capitalized to critically under capitalized,
which are used by regulatory agencies to determine a banks deposit insurance
premium, approval of applications authorizing institutions to increase their
asset size or otherwise expand business activities or acquire other
institutions. Under FDICIA, a well capitalized bank must maintain minimum
leverage, Tier 1 and Total Capital ratios of 5%, 6% and 10%, respectively. The
Federal Reserve Board applies comparable tests for holding companies such as
the Company. At March 31, 2006, the Company and the bank exceeded the
requirements for well capitalized institutions.

CAUTIONARY STATEMENT
REGARDING FORWARD-LOOKING STATEMENTS

Certain statements contained or incorporated by reference in this
quarterly report on Form 10-Q, including but not limited to, statements
concerning future results of operations or financial position, borrowing
capacity and future liquidity, future investment results, future credit
exposure, future loan losses and plans and objectives for future operations,
and other statements contained herein regarding matters that are not historical
facts, are forward-looking statements as defined in the Securities Exchange
Act of 1934. These statements are not historical facts but instead are subject
to numerous assumptions, risks and uncertainties, and represent only our belief
regarding future events, many of which, by their nature, are inherently
uncertain and outside our control. Any forward-looking statements we may make
speak only as of the date on which such statements are made. Our actual results
and financial position may differ materially from the anticipated results and
financial condition indicated in or implied by these forward-looking
statements.

Factors that
could cause our actual results to differ materially from those in the
forward-looking statements include, but are not limited to, the following:
inflation, interest rates, market and monetary fluctuations; geopolitical
developments including acts of war and terrorism and their impact on economic
conditions; the effects of, and changes in, trade, monetary and fiscal policies
and laws, including interest rate policies of the Federal Reserve Board;
changes, particularly declines, in general economic conditions and in the local
economies in which the Company operates; the financial condition of the
Companys borrowers; competitive pressures on loan and deposit pricing and
demand; changes in technology and their impact on the marketing of new products
and services and the acceptance of these products and services by new and
existing customers; the willingness of customers to substitute competitors
products and services for the Companys

20

products and
services; the impact of changes in financial services laws and regulations (including
laws concerning taxes, banking, securities and insurance); changes in
accounting principles, policies and guidelines; the success of the Company at
managing the risks involved in the foregoing as well as other risks and
uncertainties detailed from time to time in press releases and other public
filings. The foregoing list of important factors is not exclusive, and we will
not update any forward-looking statement, whether written or oral, that may be
made from time to time.

21

STERLING BANCORP AND SUBSIDIARIESAverage Balance
Sheets [1]Three Months Ended March 31,(Unaudited)(dollars in thousands)

2006
    
    2005Average
        Balance
    
    Interest
    
    Average
        Rate
    
    Average
        Balance
    
    Interest
    
    Average
        RateASSETSInterest-bearing
        deposits with other banks
    
    $
    3,045
    
    $
    30
    
    
    2.47
    %
    $
    2,380
    
    $
    6
    
    
    1.05
    %Securities
        available for sale
    
    
    170,540
    
    
    1,886
    
    
    4.44
    
    
    204,234
    
    
    2,214
    
    
    4.34Securities
        held to maturity
    
    
    506,443
    
    
    5,744
    
    
    4.54
    
    
    461,968
    
    
    5,210
    
    
    4.51Securities
        tax-exempt [2]
    
    
    31,716
    
    
    520
    
    
    6.64
    
    
    26,432
    
    
    470
    
    
    7.21Total
        investment securities
    
    
    708,699
    
    
    8,150
    
    
    4.61
    
    
    692,634
    
    
    7,894
    
    
    4.56Federal
        funds sold
    
    
    3,611
    
    
    40
    
    
    4.43
    
    
    18,556
    
    
    110
    
    
    2.37Loans,
        net of unearned discounts [3]
    
    
    1,089,505
    
    
    22,025
    
    
    8.42
    
    
    993,046
    
    
    18,376
    
    
    7.72TOTAL
        INTEREST-EARNING ASSETS
    
    
    1,804,860
    
    
    30,245
    
    
    6.85
    %
    
    1,706,616
    
    
    26,386
    
    
    6.32
    %Cash
        and due from banks
    
    
    65,277
    
    
    
    
    
    
    
    
    64,038Allowance
        for loan losses
    
    
    (17,236
    )
    
    
    
    
    
    
    
    (17,246
    )Goodwill
    
    
    21,158
    
    
    
    
    
    
    
    
    21,158Other
        assets
    
    
    91,246
    
    
    
    
    
    
    
    
    80,115TOTAL
        ASSETS
    
    $
    1,965,305
    
    
    
    
    
    
    
    $
    1,854,681LIABILITIES
        AND SHAREHOLDERS EQUITYInterest-bearing
        depositsDomesticSavings
    
    $
    25,697
    
    
    26
    
    
    0.41
    %
    $
    29,034
    
    
    25
    
    
    0.35
    %NOW
    
    
    182,512
    
    
    735
    
    
    1.63
    
    
    142,205
    
    
    194
    
    
    0.55Money
        market
    
    
    241,796
    
    
    1,022
    
    
    1.71
    
    
    226,516
    
    
    410
    
    
    0.73Time
    
    
    522,755
    
    
    4,453
    
    
    3.45
    
    
    493,471
    
    
    2,814
    
    
    2.31ForeignTime
    
    
    3,024
    
    
    8
    
    
    1.09
    
    
    3,002
    
    
    8
    
    
    1.09Total
        interest-bearing deposits
    
    
    975,784
    
    
    6,244
    
    
    2.60
    
    
    894,228
    
    
    3,451
    
    
    1.57BorrowingsSecurities
        sold under agreements to repurchase - customers
    
    
    80,065
    
    
    695
    
    
    3.52
    
    
    85,763
    
    
    337
    
    
    1.59Securities
        sold under agreements to repurchase - dealers
    
    
    86,818
    
    
    984
    
    
    4.60
    
    
    38,461
    
    
    249
    
    
    2.62Federal
        funds purchased
    
    
    12,281
    
    
    135
    
    
    4.46
    
    
    3,336
    
    
    21
    
    
    2.53Commercial
        paper
    
    
    42,141
    
    
    405
    
    
    3.89
    
    
    35,603
    
    
    160
    
    
    1.82Short-term
        borrowings - FHLB
    
    
    16,946
    
    
    193
    
    
    4.62
    
    
    
    
    
    
    
    
    Short-term
        borrowings - other
    
    
    913
    
    
    11
    
    
    4.63
    
    
    775
    
    
    5
    
    
    2.62Long-term
        borrowings - FHLB
    
    
    51,889
    
    
    586
    
    
    4.52
    
    
    96,778
    
    
    956
    
    
    3.95Long-term
        borrowings - sub debt
    
    
    25,774
    
    
    523
    
    
    8.38
    
    
    25,774
    
    
    523
    
    
    8.38Total
        borrowings
    
    
    316,827
    
    
    3,532
    
    
    4.51
    
    
    286,490
    
    
    2,251
    
    
    3.16TOTAL
        INTEREST-BEARING LIABILITIES
    
    
    1,292,611
    
    
    9,776
    
    
    3.07
    %
    
    1,180,718
    
    
    5,702
    
    
    1.95
    %Noninterest-bearing
        deposits
    
    
    441,765
    
    
    
    
    
    
    
    
    436,509Other
        liabilities
    
    
    86,963
    
    
    
    
    
    
    
    
    89,909Total
        liabilities
    
    
    1,821,339
    
    
    
    
    
    
    
    
    1,707,136Shareholders
        equity
    
    
    143,966
    
    
    
    
    
    
    
    
    147,545TOTAL
        LIABILITIES AND SHAREHOLDERS EQUITY
    
    $
    1,965,305
    
    
    
    
    
    
    
    $
    1,854,681Net
        interest income/spread
    
    
    
    
    
    20,469
    
    
    3.78
    %
    
    
    
    
    20,684
    
    
    4.37
    %Net
        yield on interest-earning assets (margin)
    
    
    
    
    
    
    
    
    4.58
    %
    
    
    
    
    
    
    
    4.91
    %Less:
        Tax equivalent adjustment
    
    
    
    
    
    204
    
    
    
    
    
    
    
    
    182Net
        interest income
    
    
    
    
    $
    20,265
    
    
    
    
    
    
    
    $
    20,502[1]
The average balances of
  assets, liabilities and shareholders equity are computed on the basis of
  daily averages. Average rates are presented on a tax-equivalent basis.
  Certain reclassifications have been made to amounts for prior periods to
  conform to the current presentation.[2]
Interest on tax-exempt
  securities is presented on a tax-equivalent basis.[3]
Includes loans held for
  sale and loans held in portfolio; all loans are domestic. Nonaccrual loans
  are included in amounts outstanding and income has been included to the
  extent earned.22

STERLING BANCORP AND SUBSIDIARIES
Rate/Volume Analysis [1]
(Unaudited)(in thousands)

Increase/ (Decrease)
  Three Months Ended
  March 31, 2006 to March 31, 2005Volume

Rate

Net [2]INTEREST
  INCOMEInterest-bearing
  deposits with other banks

$
5

$
19

$
24Securities
  available for sale


(376
)

48


(328
)Securities
  held to maturity


500


34


534Securities
  tax-exempt


89


(39
)

50Total investment
securities


213


43


256Federal
  funds sold


(124
)

54


(70
)Loans, net
  of unearned discounts [3]


1,887


1,762


3,649TOTAL
  INTEREST INCOME

$
1,981

$
1,878

$
3,859INTEREST
  EXPENSEInterest-bearing
  depositsDomesticSavings

$
(3
)
$
4

$
1NOW


69


472


541Money
market


30


582


612Time


176


1,463


1,639ForeignTime








Total
interest-bearing deposits


272


2,521


2,793BorrowingsSecurities
sold under agreements to
  repurchase - customers


(23
)

381


358Securities
sold under agreements to
  repurchase - dealers


459


276


735Federal funds
purchased


89


25


114Commercial
paper


34


211


245Short-term
borrowings - FHLB


193





193Short-term
borrowings - other


1


5


6Long-term
borrowings - FHLB


(490
)

120


(370
)Long-term
borrowings - sub debt








Total
borrowings


263


1,018


1,281TOTAL
  INTEREST EXPENSE

$
535

$
3,539

$
4,074NET INTEREST
  INCOME

$
1,446

$
(1,661
)
$
(215
)[1]
This table is presented on
  a tax-equivalent basis.[2]
Changes in interest income
  and interest expense due to a combination of both volume and rate have been
  allocated to the change due to volume and the change due to rate in
  proportion to the relationship of the change due solely to each.[3]
Includes loans held for
  sale and loans held in portfolio; all loans are domestic. Nonaccrual loans
  are included in amounts outstanding and income has been included to the
  extent earned.23
STERLING BANCORP AND SUBSIDIARIESRegulatory Capital and Ratios

Ratios and Minimums 
(dollars in thousands)

Actual

For Capital
  Adequacy Minimum

To Be Well
  CapitalizedAmount

Ratio

Amount

Ratio

Amount

RatioAs of March 31,
2006Total Capital (to Risk Weighted
Assets):The
Company

$
174,190


13.78
%
$
101,130


8.00
%
$
126,413


10.00
%The
bank


141,929


11.87


95,662


8.00


119,577


10.00Tier 1 Capital (to Risk Weighted
Assets):The
Company


158,381


12.53


50,565


4.00


75,848


6.00The
bank


126,967


10.62


47,831


4.00


71,746


6.00Tier 1 Leverage Capital (to
Average Assets):The
Company


158,381


8.15


77,766


4.00


97,207


5.00The
bank


126,967


6.77


75,005


4.00


93,757


5.00As of December 31,
2005Total Capital (to Risk Weighted
Assets):The
Company

$
172,946


13.28
%
$
104,219


8.00
%
$
130,274


10.00
%The
bank


135,307


10.99


98,520


8.00


123,150


10.00Tier 1 Capital (to Risk Weighted
Assets):The
Company


156,659


12.03


52,110


4.00


78,165


6.00The
bank


119,910


9.74


49,260


4.00


73,890


6.00Tier 1 Leverage Capital (to
Average Assets):The
Company


156,659


7.96


78,680


4.00


98,350


5.00The
bank


119,910


6.33


75,722


4.00


94,653


5.0024

ITEM 3. QUANTITATIVE AND QUALITATIVE
DISCLOSURES ABOUT MARKET RISK

ASSET/LIABILITY
MANAGEMENT

The Companys primary earnings source is its net interest income;
therefore, the Company devotes significant time and has invested in resources to
assist in the management of interest rate risk and asset quality. The Companys
net interest income is affected by changes in market interest rates, and by the
level and composition of interest-earning assets and interest-bearing
liabilities. The Companys objectives in its asset/liability management are to
utilize its capital effectively, to provide adequate liquidity and to enhance
net interest income, without taking undue risks or subjecting the Company
unduly to interest rate fluctuations.

The Company takes a coordinated approach to the management of its
liquidity, capital and interest rate risk. This risk management process is
governed by policies and limits established by senior management which are
reviewed and approved by the Asset/Liability Committee. This committee, which
is comprised of members of senior management, meets to review, among other
things, economic conditions, interest rates, yield curve, cash flow
projections, expected customer actions, liquidity levels, capital ratios and
repricing characteristics of assets, liabilities and financial instruments.

Market
Risk

Market risk is the risk of loss in a financial instrument arising from
adverse changes in market indices such as interest rates, foreign exchange
rates and equity prices. The Companys principal market risk exposure is
interest rate risk, with no material impact on earnings from changes in foreign
exchange rates or equity prices.

Interest rate risk is the exposure to changes in market interest rates.
Interest rate sensitivity is the relationship between market interest rates and
net interest income due to the repricing characteristics of assets and
liabilities. The Company monitors the interest rate sensitivity of its balance
sheet positions by examining its near-term sensitivity and its longer-term gap
position. In its management of interest rate risk, the Company utilizes several
financial and statistical tools, including traditional gap analysis and
sophisticated income simulation models.

A traditional gap analysis is prepared based on the maturity and
repricing characteristics of interest-earning assets and interest-bearing
liabilities for selected time bands. The mismatch between repricings or
maturities within a time band is commonly referred to as the gap for that
period. A positive gap (asset sensitive) where interest rate sensitive assets
exceed interest rate sensitive liabilities generally will result in the net
interest margin increasing in a rising rate environment and decreasing in a
falling rate environment. A negative gap (liability sensitive) will generally
have the opposite result on the net interest margin. However, the traditional
gap analysis does not assess the relative sensitivity of assets and liabilities
to changes in interest rates and other factors that could have an impact on
interest rate sensitivity or net interest income. The Company utilizes the gap
analysis to complement its income simulations modeling, primarily focusing on
the longer-term structure of the balance sheet.

25

The Companys balance sheet structure is primarily short-term in nature
with a substantial portion of assets and liabilities repricing or maturing
within one year. The Companys gap analysis at March 31, 2006, presented on
page 30, indicates that net interest income would increase during periods of
rising interest rates and decrease during periods of falling interest rates,
but, as mentioned above, gap analysis may not be an accurate predictor of net
interest income.

As part of its interest rate risk strategy, the Company may use
financial instrument derivatives to hedge the interest rate sensitivity of
assets. The Company has written policy guidelines, approved by the Board of
Directors, governing the use of financial instruments, including approved
counterparties, risk limits and appropriate internal control procedures. The
credit risk of derivatives arises principally from the potential for a
counterparty to fail to meet its obligation to settle a contract on a timely
basis.

As of March 31, 2006, the Company was a party to two interest rate floor
agreements with notional amounts of $50,000,000 each and maturities of
September 14, 2007 and September 14, 2008, respectively. Interest rate floor
contracts require the counterparty to pay the Company at specified future dates
the amount, if any, by which the specified interest (prime rate) falls below
the fixed floor rates, applied to the notional amounts. The Company utilizes
the financial instruments to adjust its interest rate risk position without
exposing itself to principal risk and funding requirements. These financial
instruments are being used as part of the Companys interest rate risk
management and not for trading purposes. At March 31, 2006, all counterparties
have investment grade credit ratings from the major rating agencies. Each
counterparty is specifically approved for applicable credit exposure.

The interest rate floor contracts require the Company to pay a fee for
the right to receive a fixed interest payment. The Company paid up-front
premiums of $141,250. At March 31, 2006, there were no amounts receivable under
these contracts. At March 31, 2005, the Company was not a party to any
derivative contracts.

The interest rate floor agreements were not designated as hedges for
accounting purposes and therefore changes in the fair values of the instruments
are required to be recognized as income or expenses in the Companys financial
statements. At March 31, 2006 the aggregate fair value of the interest rate
floors was $6,144 and $21,886 was charged to Other Expenses.

The Company utilizes income simulation models to complement its
traditional gap analysis. While the Asset/Liability Committee routinely
monitors simulated net interest income sensitivity over a rolling two-year
horizon, it also utilizes additional tools to monitor potential longer-term
interest rate risk. The income simulation models measure the Companys net
interest income volatility or sensitivity to interest rate changes utilizing
statistical techniques that allow the Company to consider various factors which
impact net interest income. These factors include actual maturities, estimated
cash flows, repricing characteristics, deposits growth/retention and, most
importantly, the relative sensitivity of the Companys assets and liabilities
to changes in market interest rates. This relative sensitivity is important to
consider as the Companys core deposit base has not been subject to the same
degree of interest rate sensitivity as its assets. The core deposit costs are
internally managed and tend to exhibit less sensitivity to changes in interest
rates than the Companys adjustable rate assets whose yields are based on
external indices and generally change in concert with market interest rates.

26

The Companys interest rate sensitivity is determined by identifying
the probable impact of changes in market interest rates on the yields on the
Companys assets and the rates that would be paid on its liabilities. This
modeling technique involves a degree of estimation based on certain assumptions
that management believes to be reasonable. Utilizing this process, management
projects the impact of changes in interest rates on net interest margin. The
Company has established certain policy limits for the potential volatility of
its net interest margin assuming certain levels of changes in market interest
rates with the objective of maintaining a stable net interest margin under
various probable rate scenarios. Management generally has maintained a risk
position well within the policy limits. As of March 31, 2006, the model
indicated the impact of a 200 basis point parallel and pro rata rise in rates
over 12 months would approximate a 2.2% ($1.9 million) increase in net interest
income, while the impact of a 200 basis point decline in rates over the same
period would approximate a 2.8% ($2.4 million) decline from an unchanged rate
environment.

The preceding sensitivity analysis does not represent a Company
forecast and should not be relied upon as being indicative of expected
operating results. These hypothetical estimates are based upon numerous
assumptions including: the nature and timing of interest rate levels including yield curve shape,
prepayments on loans and securities, deposit decay rates, pricing decisions on
loans and deposits, reinvestment/replacement of asset and liability cash flows, and others.
While assumptions are developed based upon current economic and local market
conditions, the Company cannot provide any assurances as to the predictive
nature of these assumptions, including how customers preferences or competitor
influences might change.

Also, as market conditions vary from those assumed in the sensitivity
analysis, actual results will also differ due to: prepayment/refinancing levels
likely deviating from those assumed, the varying impact of interest rate change
caps or floors on adjustable rate assets, the potential effect of changing debt
service levels on customers with adjustable rate loans, depositor early
withdrawals and product preference changes, and other variables. Furthermore,
the sensitivity analysis does not reflect actions that the Asset/Liability
Committee might take in responding to or anticipating changes in interest
rates.

The shape of the yield curve can cause downward pressure on net
interest income. In general, if and to the extent that the yield curve is
flatter (i.e., the differences between interest rates for different maturities
are relatively smaller) than previously anticipated, then the yield on the
Companys interest-earning assets and its cash flows will tend to be lower.
Management believes that a relatively flat yield curve shape could continue to
adversely affect the Companys results in 2006.

27

Liquidity
Risk

Liquidity is the ability to meet cash needs arising from changes in
various categories of assets and liabilities. Liquidity is constantly monitored
and managed at both the parent company and the bank levels. Liquid assets
consist of cash and due from banks, interest-bearing deposits in banks and
Federal funds sold and securities available for sale. Primary funding sources
include core deposits, capital markets funds and other money market sources. Core deposits
include domestic noninterest-bearing and interest-bearing retail deposits,
which historically have been relatively stable. The parent company and the bank
believe that they have significant unused borrowing capacity. Contingency plans
exist which we believe could be implemented on a timely basis to mitigate the
impact of any dramatic change in market conditions.

While the parent company generates income from its own operations, it
also depends for its cash requirements on funds maintained or generated by its
subsidiaries, principally the bank. Such sources have been adequate to meet the
parent companys cash requirements throughout its history.

Various legal restrictions limit the extent to which the bank can
supply funds to the parent company and its nonbank subsidiaries. All national
banks are limited in the payment of dividends without the approval of the
Comptroller of the Currency to an amount not to exceed the net profits as
defined, for the year to date combined with its retained net profits for the
preceding two calendar years.

At March 31, 2006, the parent companys short-term debt, consisting
principally of commercial paper used to finance ongoing current business
activities, was approximately $43.1 million. The parent company had cash,
interest-bearing deposits with banks and other current assets aggregating $30.7
million. The parent company also has back-up credit lines with banks of $24.0
million. Since 1979, the parent company has had no need to use the available
back-up lines of credit.

28

The following
table sets forth information regarding the Companys obligations and
commitments to make future payments under contract as of March 31, 2006:

Payments
  Due by PeriodContractual
  Obligations

Total

Less than
  1 Year

1-3
  Years

4-5
  Years

After 5
  Years(in thousands)Long-Term
  Debt

$
75,774

$


$
35,774

$
30,000

$
10,000Operating Leases


25,516


3,466


6,835


4,851


10,364Total Contractual Cash Obligations

$
101,290

$
3,466

$
42,609

$
34,851

$
20,364The following table sets forth information regarding the Companys
obligations under other commercial commitments as of March 31, 2006:

Amount of Commitment Expiration Per PeriodOther Commercial
  Commitments

Total AmountCommitted

Less than
  1 Year

1-3
  Years

4-5
  Years

After 5
  Years(in thousands)Residential loans

$
26,635

$
26,635

$


$


$
Commercial Loans


32,974


17,323


15,149


502


Total Loans


59,609


43,958


15,149


502


Standby Letters of Credit


29,240


26,641


2,599





Other Commercial Commitments


15,052


14,914








138Total Commercial Commitments

$
103,901

$
85,513

$
17,748

$
502

$
138INFORMATION AVAILABLE ON OUR WEB SITE

Our Internet
address is www.sterlingbancorp.com
and the investor relations section of our web site is located at www.sterlingbancorp.com/ir/investor.cfm.
We make available free of charge, on or through the investor relations section
of our web site, annual reports on Form 10-K, quarterly reports on
Form 10-Q and current reports on Form 8-K and amendments to those
reports filed or furnished pursuant to Section 13(a) or 15(d) of the
Securities Exchange Act of 1934 as soon as reasonably practicable after we
electronically file such material with, or furnish it to, the Securities and
Exchange Commission.

Also posted on
our web site, and available in print upon request of any shareholder to our
Investor Relations Department, are the charters for our Board of Directors
Audit Committee, Compensation Committee and Corporate Governance and Nominating
Committee, our Corporate Governance Guidelines, our Method for Interested
Persons to Communicate with Non-Management Directors and a Code of Business
Conduct and Ethics governing our directors, officers and employees. Within the
time period required by the Securities and Exchange Commission and the New York
Stock Exchange, we will post on our web site any amendment to the Code of
Business Conduct and Ethics and any waiver applicable to our senior financial
officers, as defined in the Code, or our executive officers or directors. In
addition, information concerning purchases and sales of our equity securities
by our executive officers and directors is posted on our web site.


29

STERLING BANCORP AND SUBSIDIARIES
Interest Rate Sensitivity

To mitigate the vulnerability
of earnings to changes in interest rates, the Company manages the repricing
characteristics of assets and liabilities in an attempt to control net interest
rate sensitivity. Management attempts to confine significant rate sensitivity
gaps predominantly to repricing intervals of a year or less so that adjustments
can be made quickly. Assets and liabilities with predetermined repricing dates
are classified based on the earliest repricing period. Amounts are presented in
thousands. Based on the interest rate sensitivity analysis shown below, the
Companys net interest income would increase during periods of rising interest
rates and decrease during periods of falling interest rates.

Repricing
        Date3
        Months
        or Less
    
    More
        than
        3 Months
        to 1 Year
    
    More
        than
        1 Year to
        5 Years
    
    Over
        5 Years
    
    Nonrate
        Sensitive
    
    TotalASSETSInterest-bearing
        deposits with other banks
    
    $
    1,647
    
    $
    
    
    $
    
    
    $
    
    
    $
    
    
    $
    1,647Investment
        securities
    
    
    6,342
    
    
    35,547
    
    
    99,137
    
    
    519,208
    
    
    7,896
    
    
    668,130Commercial
        and industrial loans
    
    
    577,625
    
    
    6,840
    
    
    9,685
    
    
    2,994
    
    
    (415
    )
    
    596,729Equipment
        lease financing
    
    
    3,637
    
    
    8,021
    
    
    207,362
    
    
    17,768
    
    
    (31,178
    )
    
    205,610Real
        estate-residential mortgage
    
    
    45,057
    
    
    4,879
    
    
    103,395
    
    
    28,380
    
    
    
    
    
    181,711Real
        estate-commercial mortgage
    
    
    58,080
    
    
    21,655
    
    
    28,537
    
    
    1,448
    
    
    
    
    
    109,720Real
        estate-construction loans
    
    
    2,309
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,309Installment-individuals
    
    
    14,189
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    14,189Loans
        to depository institutions
    
    
    15,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    15,000Noninterest-earning
        assets & allowance for loan losses
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    150,926
    
    
    150,926Total
        Assets
    
    
    723,886
    
    
    76,942
    
    
    448,116
    
    
    569,798
    
    
    127,229
    
    
    1,945,971LIABILITIES
        AND SHAREHOLDERS EQUITYInterest-bearing depositsSavings
        [1]
    
    
    
    
    
    
    
    
    23,803
    
    
    
    
    
    
    
    
    23,803NOW
        [1]
    
    
    
    
    
    
    
    
    172,621
    
    
    
    
    
    
    
    
    172,621Money
        market [1]
    
    
    170,814
    
    
    
    
    
    37,676
    
    
    
    
    
    
    
    
    208,490Time
        - domestic
    
    
    203,965
    
    
    254,222
    
    
    63,881
    
    
    
    
    
    
    
    
    522,068-
        foreign
    
    
    1,433
    
    
    1,592
    
    
    
    
    
    
    
    
    
    
    
    3,025Securities
        sold under agreement to repurchase - customer
    
    
    63,179
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    63,179Securities
        sold under agreement to repurchase - dealer
    
    
    68,592
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    68,592Commercial
        paper
    
    
    43,092
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    43,092Short-term
        borrowings - FHLB
    
    
    55,900
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    55,900Short-term
        borrowings - other
    
    
    104
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    104Long-term
        borrowings - FHLB
    
    
    
    
    
    
    
    
    40,000
    
    
    10,000
    
    
    
    
    
    50,000Long-term
        borrowings - subordinated debentures
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    25,774
    
    
    25,774Noninterest-bearing
        liabilities & shareholders equity
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    709,323
    
    
    709,323Total
        Liabilities and Shareholders Equity
    
    
    607,079
    
    
    255,814
    
    
    337,981
    
    
    10,000
    
    
    735,097
    
    
    1,945,971Net
        Interest Rate Sensitivity Gap
    
    $
    116,807
    
    $
    (178,872
    )
    $
    110,135
    
    $
    559,798
    
    $
    (607,868
    )
    $
    Cumulative
        Gap March 31, 2006
    
    $
    116,807
    
    $
    (62,065
    )
    $
    48,070
    
    $
    607,868
    
    $
    
    
    $
    Cumulative
        Gap March 31, 2005
    
    $
    130,636
    
    $
    (23,842
    )
    $
    70,744
    
    $
    586,783
    
    $
    
    
    $
    Cumulative
        Gap December 31, 2005
    
    $
    37,715
    
    $
    (51,516
    )
    $
    82,734
    
    $
    628,269
    
    $
    
    
    $
    [1]
Historically, balances in
  non-maturity deposit accounts have remained relatively stable despite changes
  in levels of interest rates. Balances are shown in repricing periods based on
  managements historical repricing practices and run-off experience.30

ITEM 4.
CONTROLS AND PROCEDURES

The Companys management, with the participation of the Companys
principal executive and principal financial officers, evaluated the Companys
disclosure controls and procedures (as defined in Rule 13a-15(e) under the
Securities Exchange Act of 1934) as of the end of the period covered by this
quarterly report on Form 10-Q. Based on this evaluation, the Companys
management, including the Chief Executive Officer and the Chief Financial
Officer, concluded that, as of the end of the period covered by this quarterly
report, the Companys disclosure controls and procedures were effective to
ensure that information required to be disclosed by the Company in reports that
it files or submits under the Securities Exchange Act of 1934 is recorded,
processed, summarized and reported within the time periods specified in SEC
rules and forms.

No change in the Companys internal control over financial reporting
(as defined in Rule 13a-15(f) under the Securities Exchange Act of 1934)
occurred during the fiscal quarter ended March 31, 2006 that has materially
affected, or is reasonably likely to materially affect, the Companys internal
control over financial reporting.

31

PART II - OTHER INFORMATION

Item 2. Unregistered Sales of Equity Securities and Use of
Proceeds

Under its
share repurchase program, the Company buys back common shares from time to
time. The following table discloses the Companys repurchases of the Companys
common shares during the first quarter of 2006.

ISSUER
  PURCHASES OF EQUITY SECURITIESPeriod

Total
  Number of
  Shares
  Purchased

Average
  Price Paid
  Per Share

TotalNumber of
  SharesPurchased as
  Part of Publicly
  Announced Plans
  or Programs

Maximum
  Number
  of Shares
  that May
  Yet Be
  Purchased 
  Under the Plans
  or ProgramsJanuary
  1-31, 2006

48,900

$
19.42

48,900

363,319February
  1-28, 2006








363,319March
  1-31, 2006








363,319Total

48,900




48,900All shares were repurchased through the Companys share repurchase
program.

The Board of Directors initially authorized the repurchase of common
shares in 1997 and since then has approved increases in the number of common
shares that the Company is authorized to repurchase. The latest increase was
announced on June 16, 2005, when the Board of Directors increased the Companys
authority to repurchase common shares by an additional 800,000 shares.

32

Item 6. Exhibits

The
following exhibits are filed as part of this report:

3.
(i)
Restated
  Certificate of Incorporation filed with the State of New York Department of
  State, October 28, 2004 (Filed as Exhibit 3(i) to the Registrants Form 10-Q
  for the quarter ended September 30, 2004 and incorporated herein by
  reference).(ii)
By-Laws as
  in effect on August 5, 2004 (Filed as Exhibit 3(ii)(A) to the Registrants
  Form 10-Q for the quarter ended June 30, 2004 and incorporated herein by reference).11.
 
Statement Re: Computation of Per Share Earnings.31.1

Certifications of the CEO and CFO pursuant to Exchange Act Rule
  13a-14(a).31.2

Certifications of the CEO and CFO pursuant to Exchange Act Rule
  13a-14(a).32.

Certifications of the CEO and CFO required by Section 1350
  of Chapter 63 of Title 18 of the U.S. Code.33

SIGNATURES

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

STERLING BANCORP(Registrant)Date May 10, 2006
/s/
Louis J. CappelliLouis J. CappelliChairman andChief Executive OfficerDate May 10, 2006
/s/
John W. TietjenJohn W. TietjenExecutive Vice Presidentand Chief
  Financial Officer34

STERLING BANCORP AND SUBSIDIARIES

EXHIBIT INDEX

Exhibit
Number

Description

Sequential 
Page No.11

Statement re: Computation of Per Share
Earnings.

3631.1

Certifications of the CEO and CFO pursuant to
  Exchange Act Rule 13a-14(a).

3731.2

Certifications of the CEO and CFO pursuant to
  Exchange Act Rule 13a-14(a).

3832

Certifications of the CEO and CFO required by Section
  1350 of Chapter 63 of Title 18 of the U.S. Code.

3935