UNITED STATES
                     SECURITIES AND EXCHANGE COMMISSION 
                           Washington, D.C. 20549 

                                  FORM 10-K 
(Mark One)      
     [x]         Annual Report Pursuant to Section 13 or 15(d) 
                   of the Securities Exchange Act of 1934 
                 For the fiscal year ended December 31, 1996 

                                      OR

     [ ]    Transition Report Pursuant to Section 13 or 15(d) of the 
                       Securities Exchange Act of 1934 

                       Commission file Number 0-22516 

                         GREENPOINT FINANCIAL CORP. 
           (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) 

              DELAWARE                               06-1379001  
(STATE OR OTHER JURISDICTION OF 
INCORPORATION OR ORGANIZATION)          (I.R.S. EMPLOYER IDENTIFICATION NUMBER)

90 PARK AVENUE, NEW YORK, NEW YORK                      10016
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)              (ZIP CODE) 

     REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (212) 834-1711 

         SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT:

      TITLE OF EACH CLASS           NAME OF EACH EXCHANGE ON WHICH REGISTERED
              NONE                                     NONE

         SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT: 

                            TITLE OF EACH CLASS  
                         Common Stock $0.01 par value

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 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] YES      [ ] NO 

Indicate by check mark if disclosure of delinquent filers pursuant to item 405 
of Regulation S-K is not contained herein, and will not be contained, to the 
best of registrant's knowledge, in definitive proxy or information statements 
incorporated by reference in Part III of this Form 10-K or any amendment to 
this Form 10-K. [x]

The aggregate market value of the voting stock held by non-affiliates of the 
registrant as of  March 21, 1997: Common stock par value $0.01 per share, 
$2,117,587.

This figure is based on the closing price by the New York Stock Exchange 
("NYSE") for a share of the registrant's common stock on March 21, 1997, which 
was $55.00 as reported in the Wall Street Journal on March 24, 1997.  The 
number of shares of the registrant's Common Stock issued and outstanding as of  
March 21, 1997 was 47,152,976 shares.

                     DOCUMENTS INCORPORATED BY REFERENCE
Portions of the definitive Proxy Statement for the Annual Meeting of 
Stockholders to be held on May 2, 1997 and the Annual Report to Stockholders 
for fiscal 1996 are incorporated herein by reference  - Parts II and III. 
                              TABLE OF CONTENTS
                                                                       Page No.
                                    PART I

ITEM 1.   BUSINESS                                                          1
    Description of the Business                                             1
    Mortgage Banking Services                                               1
    Consumer Branch Network                                                 1
    Competition                                                             2
    Lending Activities                                                      2
    Delinquent Loans and Foreclosed Assets                                  9
    Allowance for Possible Loan Losses                                     12
    Environmental Issues                                                   15
    Interest Rate Risk Management                                          15
    Securities Investment Activities                                       15
    Sources of Funds                                                       18
    Subsidiary Activities                                                  20
    Savings Bank Life Insurance                                            21
    Personnel                                                              21
    Federal Taxation                                                       21
    State and Local Taxation                                               23
    Bank Regulation and Supervision                                        23
    Holding Company Regulation and Supervision                             28

ITEM 2.   PROPERTIES                                                       30

ITEM 3.   LEGAL PROCEEDINGS                                                30

ITEM 4.   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS              30

ITEM 4A. EXECUTIVE OFFICERS                                                31

                                   PART II

ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND 
           RELATED STOCKHOLDER MATTERS                                     33

ITEM 6.  SELECTED FINANCIAL DATA                                           33

ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL 
           CONDITION AND RESULTS OF OPERATIONS                             33

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA                       33

ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON 
           ACCOUNTING AND FINANCIAL DISCLOSURE                             33

                                   PART III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT               33

ITEM 11.  EXECUTIVE COMPENSATION                                           33

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT   33

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS                   34

                                   PART IV

ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON
            FORM 8-K                                                       35



                                   PART I

ITEM 1. BUSINESS

Description of Business

GreenPoint Financial Corp.  (the "Company") is a bank holding company organized 
in August 1993 under the laws of the state of Delaware and registered under the 
Bank Holding Company Act of 1956.

The Company provides a variety of financial services primarily through its bank 
subsidiary, GreenPoint Bank (the "Bank") including GreenPoint Mortgage Corp. 
("GPMC"), its mortgage banking subsidiary, and to a lesser extent through its 
community development subsidiary, GreenPoint Community Development Corp. 
("GPCDC").  As part of the Company's long term business plans, the Company 
intends to continue to explore a variety of alternative strategic investment 
options to complement its existing business strengths, including possible 
acquisitions of other thrift institutions, acquisitions of other financial 
institutions or financial services companies or their assets, or expanding into 
other banking, mortgage, real estate or consumer finance related businesses.  

The Bank was organized in 1868 as a New York State chartered savings bank.  The 
Bank and its wholly owned subsidiary GPMC, a national home mortgage banking 
company, are primarily engaged in the business of mortgage lending throughout 
the United States, with loans receivable of $7.3 billion, representing 
approximately 55% of total assets at December 31, 1996.  The Bank continues to 
attract retail deposits from the general public and invests those deposits, 
together with funds generated from operations, in mortgage loans and marketable 
securities.  The Bank's revenues are derived principally from interest on its 
loan portfolio and investment securities. The Bank's primary sources of funds 
are deposits, principal and interest payments from loans, and interest from 
investment securities.

GPCDC is a for-profit community development subsidiary organized in 1993.  
Complementing the Bank's leadership in lending in low- and moderate-income 
areas and to minorities, GPCDC's focus is primarily on special lending 
programs, development opportunities and assistance, consulting and other 
activities that promote the objective of greater access to affordable housing 
for low- and moderate-income persons residing in the areas served by the 
Company.


MORTGAGE BANKING SERVICES

The Company specializes in a limited documentation mortgage loan product ("No 
Doc" and "Low Doc" loans) which serves a particular niche of borrowers willing 
to pay a premium, in the form of higher interest rates and loan fees, and 
provide larger down payments in exchange for more expedient loan processing by 
virtue of providing less income and asset information as compared to loans 
underwritten in conformance with Federal National Mortgage Association ("FNMA") 
standards. As a result of this strategy combined with strict appraisal 
requirements, the Company has achieved higher interest margins and levels of 
net interest income compared to typical FNMA conforming loans which, in turn, 
has resulted in a high level of profitability despite traditionally higher 
levels of loan delinquencies.

During 1996, the Company successfully expanded its mortgage lending program to 
include new markets in Chicago, Boston, Philadelphia, Washington, D.C., and 
Miami.  Through the expansion of the mortgage lending program, the Company has 
more than doubled mortgage loan originations to $2.4 billion, compared to $1.0 
billion in 1995.




CONSUMER BRANCH NETWORK

The Consumer Branch Network ("Branch Network") consists of 76 full-service 
banking offices, with 80 ATMs, located in the New York City metropolitan area 
and offers a variety of financial services to meet the needs of the communities 
it serves.  Among the services offered by the Branch Network are traditional 
time, savings and checking accounts, annuity products, Savings Bank Life 
Insurance, safe deposit services and student loans.  


COMPETITION 

The Company faces significant competition both in making loans and in 
attracting deposits. The New York City metropolitan area has a high density of 
financial institutions, many of which are branches of significantly larger 
institutions which have greater financial resources than the Company, and all 
of which are competitors of the Company to varying degrees. The Company's 
competition for loans comes principally from savings banks, commercial banks, 
savings and loan associations, mortgage banking companies and credit unions. 
Its most direct competition for deposits has historically come from savings and 
loan associations, savings banks, commercial banks and credit unions. The 
Company faces additional competition for deposits from non-depository 
competitors such as the mutual fund industry, securities and brokerage firms 
and insurance companies. Competition may also increase as a result of the 
lifting of restrictions on the interstate operations of financial institutions. 

The Company's focus on one-to four-family residential lending and No Doc and 
Low Doc loans has allowed it to develop a significant market presence in the 
one-to four-family residential loan market. Due to the Company's current 
presence in these markets and its limited lending focus, no assurance can be 
given that the Company will be able to sustain the growth it has achieved in 
the past in the event loan demand in these markets declines which, in turn, may 
negatively impact its interest rate margin, interest rate spread and net 
income. Further, in the event other financial institutions establish lending 
programs which target the one-to four-family lending similar to the Company's 
No Doc and Low Doc programs, such intensified competition may result in the 
Company's inability to sustain its previous growth in such lending or result in 
a decline in the Company's market share. The Company's narrow lending focus on 
these specialized markets may also place the Company in a less favorable 
position to increase its market share in other types of lending as compared to 
an institution with a broader based lending focus and expertise in other types 
of lending. 


LENDING ACTIVITIES 

LENDING PROGRAMS. The Company's lending activities have historically emphasized 
and continue to emphasize the origination of real estate loans which are 
underwritten with primary reliance placed upon a borrower's level of equity in 
the property securing the loan or level of down payment, as compared to other 
lending institutions which may rely more heavily upon a borrower's demonstrated 
ability to repay the loan and independently verified income levels. These 
equity-based loans are offered in two programs: (1) loans which are 
underwritten without qualification of a borrower's income level or independent 
verification of a borrower's income or financial assets as represented by such 
borrower ("No Doc loans") or (2) loans which are similarly underwritten but 
which require a borrower to demonstrate annual income of 50% of the loan amount 
which the Company  verifies by reviewing tax return information submitted by 
the borrower ("Low Doc loans"). The Company  also requires borrowers to have 
satisfactory credit histories in the case of No Doc or Low Doc loans. As 
compared to the loans the Company originates in accordance with FNMA 
underwriting guidelines and procedures ("FNMA conforming loans"), No Doc and 
Low Doc loans involve a higher degree of risk as there is limited verified 
knowledge of the borrower's level of income or ability to service the 
indebtedness which, in turn, may result in a higher rate of default. In 
recognition of the increased risks associated with No Doc and Low Doc loans, 
the Company requires borrowers to have a higher equity position in the property 
securing the loan. The Company does not originate such loans with loan to value 
ratios in excess of 75%.  The Company's No Doc lending program accounted for 
93.4% of total originations.

As compared to other lending institutions which rely more heavily upon a 
borrower's income and demonstrated ability to repay the loan, the Company may 
be more susceptible to increases in loan delinquencies in periods of economic 
recession and to loan losses in periods of declining real estate market values. 
In recognition of the risks associated with this lending strategy, the Company 
has established strict appraisal standards, whereby all appraisals are required 
to conform either to FNMA, FHLMC, federal or ftate appraisal standards and are 
either: 1) conducted or reviewed by in-house appraisers who are state 
certified real estate appraisers and are subject to two additional levels of 
review by senior management; or are 2) conducted by two separate independent 
appraisers or appraisal services, one of which is commissioned directly by the 
Company from a list of appraisers which the Company has specifically approved. 

LOAN ORIGINATIONS. The Company originates both adjustable rate mortgage ("ARM") 
loans and fixed rate loans, the amounts of which are dependent upon customer 
demand and market rates of interest. Loan originations are primarily obtained 
from the Company's network of registered mortgage brokers, licensed mortgage 
bankers, attorneys and other real estate professionals participating in its 
three conduit programs and, to a lesser extent, from existing or past customers 
and members of the local communities located in the Company's lending area.  
For the year ended December 31, 1996, the Company originated $2.4 billion of 
mortgage loans.

The Company's Advantage Program is a structured program in which registered 
mortgage brokers, licensed mortgage bankers, attorneys and other real estate 
professionals, are eligible to participate upon approval by the Company.  As of 
December 31, 1996, there were 967 Advantage Program members.  

The Company's Lender Associate Program consists of 1,867 approved mortgage 
brokers operating in 47 states.  These brokers are generally small to mid-sized 
mortgage originators which rely on the Company to fund loans at closing.  Each 
broker is screened by the Company and is approved only if the Lender Associate 
Program requirements are satisfied.

The Company's Correspondent Program is a closed loan purchase program 
consisting of 180 approved correspondents operating in 47 states.  These 
correspondents include mid-sized to large mortgage bankers and other financial 
institutions.  

For the year ended December 31, 1996, the Company originated $2.1 billion of 
loans through these programs, or 89.8% of total loan originations.

The types of loans that the Company may originate are subject to federal and 
state laws and regulations. Interest rates charged by the Company on loans are 
affected principally by the demand for such loans and the supply of money 
available for lending purposes and the rates offered by its competitors. These 
factors are, in turn, affected by general and economic conditions, monetary 
policies of the federal government, including the Federal Reserve Board 
("FRB"), legislative tax policies and governmental budgetary matters. 

LOANS HELD FOR INVESTMENT PORTFOLIO COMPOSITION.  The majority of the Company's 
loan portfolio consists of fixed and ARM loans secured by one-to four-family 
residences and to a lesser extent, multi-family residential loans, commercial 
real estate loans and other loans held for investment.

The following tables set forth the composition of the loans receivable held for 
investment, in dollar amounts and in percentages of the respective portfolios 
at the dates indicated. 

<TABLE>
<CAPTION>
                                                                       At December 31, 
                                                --------------------------------------------------------------
                                                         1996                 1995                 1994
                                                --------------------  -------------------  -------------------
                                                            Percent              Percent              Percent
                                                  Amounts   of Total   Amounts   of Total   Amounts   of Total
                                                ---------  ---------  --------  ---------  --------  ---------
                                                                     (Dollars in millions)
<S>                                             <C>        <C>        <C>       <C>        <C>       <C>
Loans receivable held for investment:
Mortgage loans:
   One-to four-family                           $ 6,394.4      85.9%  $5,135.4      85.2%  $4,933.9      85.7
   Multi-family                                     545.5       7.3      475.9       7.9      456.9       7.9
   Commercial                                       467.9       6.3      376.8       6.3      349.7       6.1
   Home equity loans                                 16.2       0.2        4.7       0.1       10.1       0.2
Total mortgage loans held for investment          7,424.0      99.7    5,992.8      99.5    5,750.6      99.9
Other loans:
   Loans secured by depositors' funds                23.5       0.3       29.5       0.5        7.7       0.1
   Home improvement loans                             ---       ---        0.1       ---        0.1       ---
Total other loans                                    23.5       0.3       29.6       0.5        7.8       0.1
Total loans receivable held for investment        7,447.5     100.0%   6,022.4     100.0%   5,758.4     100.0%

Less:
Deferred loan origination fees and unearned
discount                                             48.2                 58.3                 61.3 
Allowance for possible loan losses                  105.0                105.5                103.0 
   Loans receivable held for investment, net    $ 7,294.3             $5,858.6             $5,594.1 
</TABLE>


<TABLE>
<CAPTION>
                                                    At December 31,                At June 30,
                                                --------------------  ----------------------------------------
                                                         1993                 1993                 1992
                                                --------------------  -------------------  -------------------
                                                            Percent              Percent              Percent
                                                  Amounts   of Total   Amounts   of Total   Amounts   of Total
                                                ---------  ---------  --------  ---------  --------  ---------
                                                                     (Dollars in millions)
<S>                                             <C>        <C>        <C>       <C>        <C>       <C>
Loans receivable held for investment:
Mortgage loans:
   One-to four-family                            $4,770.8      85.4%  $4,564.6      84.7%  $4,169.6      82.6%
   Multi-family                                     456.8       8.2      460.7       8.5      491.9       9.7
   Commercial                                       328.1       5.9      339.1       6.3      359.5       7.1
   Home equity loans                                 19.9       0.4       22.3       0.4       23.7       0.5
Total mortgage loans held for investment          5,575.6      99.9    5,386.7      99.9    5,044.7      99.9
Other loans:
   Loans secured by depositors' funds                 7.2       0.1        7.0       0.1        6.9       0.1
   Home improvement loans                             0.2       ---        0.2       ---        0.3       ---
Total other loans                                     7.4       0.1        7.2       0.1        7.2       0.1
Total loans receivable held for investment        5,583.0     100.0%   5,393.9     100.0%   5,051.9     100.0%

Less:
Deferred loan origination fees and unearned
   discount                                          59.4                 56.5                 50.9 
Allowance for possible loan losses                  147.0                136.5                130.5 
   Loans receivable held for investment, net     $5,376.6             $5,200.9             $4,870.5 
</TABLE>




The following table sets forth the composition of the Company's loans 
receivable held for sale, at the dates indicated.




<TABLE>
<CAPTION>
                                                      At December 31,            At June 30,
                                           ----------------------------------  ----------------
                                             1996     1995     1994     1993     1993     1992
                                           -------  -------  -------  -------  -------  -------
                                                              (In millions)
<S>                                        <C>      <C>      <C>      <C>      <C>      <C>
Loans receivable held for sale:
Performing residential mortgage loans       $ 0.3   $168.2   $  0.5   $  ---   $  ---   $  ---
Guaranteed student loans                      4.5      6.9     10.6     13.7     14.5     15.3
Non-performing residential mortgage loans     ---      ---      ---     72.1     80.0      ---
Valuation allowance                           ---      ---      ---    (20.0)   (20.0)     ---
   Loans receivable held for sale, net      $ 4.8   $175.1   $ 11.1   $ 65.8   $ 74.5   $ 15.3
</TABLE>


LOAN SALES AND SERVICING. Prior to 1991, the Company was actively engaged in 
the sale of its No Doc and Low Doc loans in the secondary market (primarily to 
FNMA).  Due in part to FNMA's curtailment of purchases of No Doc and Low Doc 
loans and the Company's decision in 1996 to portfolio new loan production 
rather than sell loans in the secondary market, the Company's portfolio of 
loans serviced for others has decreased from $2.3 billion at June 30, 1992, to 
$1.0 billion at December 31, 1996. This decrease, in conjunction with increased 
prepayment activity resulting from the lower interest rate environment, has 
resulted in a decrease in gross servicing fee income from $23.1 million for 
fiscal 1992 to $8.7 million for the year ended December 31, 1996. The net 
servicing asset represents the present value of the portion of the future 
servicing fee income expected to be received by the Company in excess of normal 
servicing fee income, based on prepayment assumptions, net of any required 
recourse reserve. The net excess servicing asset is amortized against servicing 
fee income, the rate of which is evaluated annually and adjusted as a charge to 
operations to the extent actual prepayments exceed estimated prepayments. As of 
December 31, 1996, the Company's net excess servicing asset was $5.0 million.

LOAN MATURITY AND REPRICING 
The following table shows the contractual maturities of the Company's loan 
portfolio, including loans receivable held for sale, at December 31, 1996. The 
table does not include prepayments or scheduled principal amortization. 
Prepayments and scheduled principal amortization on mortgage loans totaled 
$806.6 million for the year ended December 31, 1996. 
<TABLE>
<CAPTION>
                                                At December 31, 1996
                         -------------------------------------------------------------------
                                    Mortgage Loans
                         ---------------------------------------
                         One-to Four-                                  Other     Total Loans
                            Family    Multi-Family   Commercial        Loans      Receivable
                         -----------  ------------  ------------  ------------  ------------
                                                    (In millions)
<S>                      <C>          <C>           <C>           <C>           <C>
Amounts due (1):
  Within one year          $    3.3       $   0.8       $   0.8        $  9.9      $   14.8
  One to five years            90.3          35.2          39.6          17.9         183.0
  Over five years           6,046.1         461.2         391.0           ---       6,898.3
    Total amounts due      $6,139.7       $ 497.2       $ 431.4        $ 27.8      $7,096.1
</TABLE>


(1)  Does not include non-accrual loans. 


The following table sets forth, at December 31, 1996, the dollar amount of all 
fixed rate loans contractually due and adjustable rate loans repricing after 
December 31, 1997.

                         Due or Repricing After December 31, 1997
                          ----------------------------------------
                               Fixed     Adjustable      Total
                            ----------   ----------   ----------
                                        (In millions)
Mortgage loans (1):
One-to four-family           $4,102.2     $  240.5     $4,342.7
Multi-family                    424.3         56.9        481.2
Commercial                      328.4         85.5        413.9
Other loans (1)                  17.9          ---         17.9
   Total loans receivable    $4,872.8     $  382.9     $5,255.7

______________

(1)  Does not include non-accrual loans.

One-to Four-Family Mortgage Loans.  The Company  offers first mortgage loans
secured by one-to four-family residences, including condominiums.  The Company  
does not offer loans secured by cooperative units or interests therein.

The Company  currently offers fixed rate one-to four-family mortgage loans and 
one-to four-family ARM loans through three loan programs: (1) No Doc loans, (2) 
Low Doc loans and (3) loans underwritten and made in amounts in accordance with 
FNMA guidelines ("FNMA conforming" or "Full Doc" loans).  No Doc and Low Doc 
loans, with the exception of loans secured by condominiums, are offered in 
amounts up to 75% of the lower of the appraised value or purchase price of the 
property.  No Doc and Low Doc loans secured by condominiums are made in amounts 
up to 70% of the lower of the appraised value or purchase price of the property 
for loans involving the purchase of the property, and up to 65% of the 
appraised value of the property for loans to refinance existing mortgage loans. 
The maximum loan amount of a No Doc or Low Doc loan is $1.0 million.  The 
Company requires No Doc loan applicants to complete a FNMA conforming 
application and request the submission of income and asset information.  
Although the Company reserves the right to verify such income and asset 
information, the Company generally does not verify such information through 
other sources.  The Company additionally obtains credit reports on all 
borrowers to ascertain the credit history of the borrower.  Loans originated 
under the Company's Low Doc loan program involves the same procedures and 
information applicable to No Doc loans with the additional requirements that 
the borrower provide tax return information and meet certain income to loan 
ratios.

The Company offers fixed rate mortgage loans with terms of 10 to 30 years 
secured by owner-occupied one-to four-family residences. Interest rates charged 
on fixed rate loans are competitively priced on a regular basis and are 
periodically determined based on market conditions. For the year ended December 
31, 1996, the Company  originated $1.5 billion of fixed rate loans, which 
primarily consisted of one-to four-family residential mortgage loans. 

The Company currently offers ARM loans secured by one-to four-family 
residential properties with interest rates that adjust every year with terms of 
up to 30 years. The interest rates on ARM loans fluctuate based upon a spread 
above the applicable index rate used by the Company and are generally 
subject to limitations on interest rate increases of 2% per year and a 
limitation on the aggregate adjustment of 6% above the index at the time 
of commitment over the term of the loan. The Company's ARM loans also have 
interest rate floors which limit the minimum amount to which the interest rate 
payable on its ARM loans may decline. Depending on the type of loan, such 
interest rate floors currently range from a minimum of 100 basis points below 
to a minimum of 450 basis points over the index rate used at origination. The 
Company offers ARM loans at fully indexed rates and with initial interest rates 
below the current fully indexed rate. As of December 31, 1996, the initial 
discounted rate on these loans was 200 to 300 basis points below the Company's 
fully indexed rate, which was 9.25%.  For the year ended December 31, 1996, the 
Company originated $0.8 billion of ARM loans, which primarily consisted of 
one-to four-family residential loans. At December 31, 1996, 33.9% of the 
Company's one-to four-family residential mortgage loans consisted of ARM loans. 

The volume and types of ARM loans originated by the Company have been affected 
by such market factors as the level of interest rates, competition, consumer 
preferences and the availability of funds.  The Company will continue to offer 
ARM loans, however, there can be no assurance that in the future the Company 
will be able to originate a sufficient volume of ARM loans to increase or 
maintain the proportion that these loans bear to total loans. The retention of 
ARM loans, as opposed to fixed rate residential mortgage loans, in the 
Company's loan portfolio serves to reduce the Company's exposure to increases 
in interest rates. However, ARM loans generally pose credit risks different 
from the risks inherent in fixed rate loans, primarily because as interest 
rates rise, the underlying payments of the borrower rise, thereby increasing 
the potential for default. In particular, the Company's loans which bear 
initial discounted interest rates involve greater risks of default due to the 
greater potential increase in the borrower's payment after the first year of 
the loan. 

The Company also originates ARM loans secured by first mortgages on 
non-owner-occupied one-to four-family properties pursuant to the same 
underwriting guidelines applicable to similarly situated owner-occupied one-to 
four-family properties but in amounts which are limited to 70% of the lower of 
the appraised value or purchase price for loans involving the purchase of the 
property and up to 65% of the appraised value of the property for loans 
involving the refinancing of an existing mortgage.  Additionally, the Company 
requires the submission of rental information and considers such information in 
arriving at its underwriting determination. The Company charges higher 
origination fees and rates of interest with respect to these loans as compared 
to its other one-to four-family ARM loans secured by owner-occupied properties 
and imposes penalties for early repayment. 

The Company currently offers ARM loans secured by second mortgages on one-to 
four-family, owner-occupied residences. The Company currently originates such 
second mortgage loans only when the Company holds the existing mortgage on the 
property securing the loan. The Company previously originated fixed rate second 
mortgage loans and second mortgage loans secured by properties where the 
Company did not hold the first mortgage. The underwriting standards and 
procedures applicable to these loans are the same as its one-to four-family 
first mortgage loans, except such loans are offered in amounts up to $150,000 
with terms up to 20 years. 

The Company also offers home equity lines of credit which are secured by 
mortgages on one-to four-family properties. The underwriting standards 
applicable to these loans are the same as other one-to four-family loans except 
such loans are offered with terms up to 15 years in amounts, including any 
balance of the first mortgage, up to 65% of the appraised value of the property 
with a maximum loan amount of $125,000. As of December 31, 1996, loans drawn 
against home equity lines of credit totaled $16.2 million, or 0.2%, of total 
loans held for investment. 

The Company's mortgage loans generally include due-on-sale clauses which 
provide the Company with the contractual right to deem the loan immediately due 
and payable in the event that the borrower transfers ownership of the property 
without the Company's consent. It is the Company's policy to enforce 
due-on-sale provisions within the applicable regulations and guidelines imposed 
by federal and state laws and secondary market purchasers. 

MULTI-FAMILY LENDING. The Company offers fixed rate and ARM loans secured by 
residential properties with five or more units and other mixed use properties 
(primarily residential properties with business or retail space) located in the 
Company's primary lending area. As of December 31, 1996, the Company had 4,981 
of such loans with an average loan balance of $109,507.  Multi-family loans are 
generally made with terms of 5 to 25 years in amounts up to a maximum of $3.0 
million.  These loans are made in amounts up to 70% of the appraised value or 
purchase price of the property for loans to purchase the property and up to 65% 
of the appraised value of the property for loans to refinance an existing 
mortgage. The Company's multi-family loans are underwritten pursuant to the 
same standards and procedures applicable to its one-to four-family No Doc and 
Low Doc loans; however, the Company additionally requires the submission of 
documentation regarding rental and vacancy levels, rental income, property 
expense statements and tax return information. The Company verifies rental 
income of the property but does not verify the borrower's personal income 
levels. The Company imposes penalties for early repayment on all 
non-owner-occupied multi-family properties and owner-occupied multi-family 
properties with seven units or more. 

COMMERCIAL REAL ESTATE LENDING. The Company also originates commercial real 
estate loans located in the Company's primary lending area. The Company's 
commercial real estate loans are offered in the same amounts and under the same 
terms and underwriting guidelines applicable to its multi-family loans. The 
Company imposes penalties for early repayments on its commercial real estate 
loans. As of December 31, 1996, the Company had 3,440 of such loans with an
average loan balance of $136,035.  The largest commercial real estate loans in
the Company's portfolio at December 31, 1996 were two loans with an outstanding
balance of $4.4 million secured by non-residential buildings located in New 
York.

STUDENT LOANS AND OTHER LENDING. The Company also originates student loans 
guaranteed by federal and New York State agencies and personal savings loans 
collateralized by a borrower's existing savings account balance at the Bank. 
With the exception of student loans which the Company generally sells in the 
secondary market upon the borrower's commencement of repayment of the loan, 
these other loans are originated for retention.  The Company does not 
currently originate or purchase any other types of business or consumer loans 
such as loans secured by automobiles, unsecured business loans or credit card 
loans. 

LOAN APPROVAL, AUTHORITY AND UNDERWRITING. Due to the Company's emphasis on an 
equity-based lending strategy and reliance upon the value of the property 
securing a loan to reduce the potential risk of principal loss to the Company, 
particularly with respect to its No Doc and Low Doc loan programs, the Company 
has established a comprehensive in-house appraisal system which currently 
utilizes 41 staff appraisers, 36 of whom are licensed or certified by New York 
State, of which 7 are certified in New Jersey and 1 certified in all states. The
Company also utilizes independent appraisers for most of its National Mortgage 
production.  The Company's appraisal system involves a three-tier review for 
every mortgage loan originated by the Company, consisting of an appraisal 
conducted or reviewed by a certified appraiser, which is then reviewed by the 
Company's underwriting personnel and finally by management's Executive Mortgage 
Loan Committee for loans originated by the Bank, and an underwriting manager 
for loans originated by GPMC.

Pursuant to the Bank's loan approval policies, all mortgage loans are 
approved by the Executive Mortgage Loan Committee. Additionally, all one-to 
four-family mortgage loans exceeding $1.0 million and commercial loans 
exceeding $3.0 million, require the approval of the Executive Vice President. 
Mortgage loans in excess of $1.0 million would require an additional appraisal 
conducted by an outside appraiser. The Bank also limits the maximum loan 
amount to any one individual or business entity to $15.0 million. The Board of 
Directors is provided a listing of loans approved by the Executive Mortgage 
Loan Committee on a monthly basis. GPMC loans are subject to various approval 
requirements depending on the size of the loans. Loans greater than $650,000 
are approved by the Director of Credit Administration. In recent years, the 
Company has made no loans in excess of $4.4 million.  


DELINQUENT LOANS AND FORECLOSED ASSETS 

The Company's collection procedures utilize automated collection letters and 
telephone contact with borrowers to obtain repayment. For delinquent mortgage 
loans with monthly payments of $2,000 or less, delinquency notices are sent 
when a loan becomes 15 days past due with a second notice being sent after the 
loan is 30 days past due. On or about the 40th day of delinquency a notice is 
sent informing the borrower that a breach has occurred indicating the date 
foreclosure will commence. After 60 days a default letter is sent requesting 
payment of the arrears to avoid acceleration of the loan. In the event payment 
is not received by the 90th day of delinquency, the Company refers the loan to 
its attorneys and a certified letter is sent informing the borrower that 
foreclosure action has commenced. With respect to delinquent mortgage loans 
with monthly payments in excess of $2,000, the same procedures generally apply 
except that the notices are sent at earlier dates of delinquency, and such 
loans are referred to the Company's attorney for foreclosure upon the loan 
becoming 60 days past due. During the period of delinquency additional 
telephone contacts with the borrower are made to make definite payment 
arrangements, determine the reason for the arrears and refer borrowers to a 
financial counselor. 

The Company discontinues accruing interest and charges-off the accrued interest 
on all delinquent mortgage loans upon the loan becoming 90 days past due. The 
Company generally does not restructure the original terms of delinquent loans 
by modifying the interest rate paid or capitalizing past due interest. 

The Company attempts to accommodate the needs of its borrowers who find 
themselves in difficult circumstances and minimize its potential losses upon 
foreclosure by emphasizing the use of forbearance agreements. These forbearance 
agreements generally provide that the Company will agree to delay foreclosure 
proceedings if the borrower agrees to repay any accrued interest and principal 
arrears over a period of up to 36 months in addition to paying the principal 
and interest due in accordance with the original terms of the loan. The 
forbearance agreements typically provide that in the event the borrower is not 
current with payments under the forbearance agreement or any payments due under 
the original mortgage note, the Company may resume its foreclosure action. As 
of December 31, 1996, the Company had $67.5 million of loans, or 19.0%, of 
total non-performing loans subject to such forbearance agreements, the 
substantial majority of which were one-to four-family mortgage loans. 

Historically, the Company has relied solely on its collection and foreclosure 
process to reduce its level of non-performing loans.  This process, combined 
with the Company's low loan to value ratios, has in the past protected the 
Company from high loan losses.  Due to increases in the cost of holding other 
real estate owned, the Company continues to investigate alternative methods for 
reducing non-performing loans that may result in a higher present value 
received by the Company.  

Based upon the Company's loan-to-value policies, the Company does not believe 
that the overall risk of loss associated with its current loan portfolio and 
non-performing assets is excessive. However, the Company's underwriting 
determinations rely heavily upon the market value of the properties securing 
the loans and, consequently, no assurances can be given that declines 
in real estate values in the Company's primary lending area will not result in 
unanticipated principal losses to the Company or that declines in the 
regional economy will not result in increased delinquencies or increases in 
foreclosure-related expenses and expenses related to its other real estate.

At December 31, 1996, 1995, 1994 and 1993, loans delinquent 90 days or more 
were as follows: 

                                                  At December 31,
                                 ----------------------------------------------
                                          1996                    1995
                                 ----------------------  ----------------------
                                                  90 days or more
                                 ----------------------------------------------
                                              Principal               Principal
                                 Numbers of  Balance of   Number of  Balance of
                                     Loans       Loans       Loans       Loans
                                 ----------  ----------  ----------  ----------
                                             (Dollars in millions)
Mortgage loans:
   One-to four-family                2,559    $  242.7       2,737    $  254.3
   Multi-family                        430        46.0         533        57.9
   Commercial real estate              271        35.2         358        46.8
   Home equity loans                     7         0.5          16         0.8
      Total mortgage loans           3,267       324.4       3,644       359.8
Other loans                            168         0.1         ---         ---
      Total loans                    3,435     $ 324.5       3,644    $  359.8
Delinquent loans to total loans                   4.36%                   5.81%


                                                   At December 31,
                                 ----------------------------------------------
                                          1994                  1993(1)
                                 ----------------------  ----------------------
                                                  90 days or more
                                 ----------------------------------------------
                                              Principal               Principal
                                 Numbers of  Balance of   Number or  Balance of
                                     Loans       Loans       Loans       Loans
                                 ----------  ----------  ----------  ----------
                                             (Dollars in millions)
Mortgage loans:
   One -to four-family               2,438    $  220.9       4,664    $  467.8
   Multi-family                        619        68.6         871        93.1
   Commercial real estate              413        56.8         473        65.0
   Home equity loans                    14         0.7          26         1.2
      Total mortgage loans           3,484       347.0       6,034       627.1
Other loans                             46         0.3          64         0.5
      Total loans                    3,530    $  347.3       6,098    $  627.6
Delinquent loans to total loans                   6.02%                  11.11%


(1)  Includes non-performing mortgage loans held for sale, net of charge-offs 
and valuation reserves. 

The following table sets forth information regarding all non-accrual loans, 
including loans in forbearance, loans which are 90 days or more delinquent but 
on which the Company is accruing interest and other real estate owned at the 
dates indicated.

<TABLE>
<CAPTION>
                                                         At December 31,                         At June 30,
                                           -------------------------------------------  --------------------------
                                             1996      1995      1994          1993           1993         1992
                                           --------  --------  --------  -------------  -------------  -----------
                                                                   (Dollars in mILLIONS)
<S>                                        <C>       <C>       <C>       <C>            <C>            <C>
Non-accrual mortgage loans                 $ 356.0   $ 402.1   $ 391.9     $ 678.3(1)     $ 635.4(1)      $ 622.7
Non-accrual other loans (2)                    0.1       ---       ---         ---            ---             ---
Other loans 90 days or more delinquent 
   and still accruing                          ---       ---       0.3         0.5            0.4             0.8
      Total non-performing loans (3)         356.1     402.1     392.2       678.8          635.8           623.5

Other real estate owned, net (4)              28.6      29.2      54.0        74.8           72.6            46.9
      Total non-performing assets          $ 384.7   $ 431.3   $ 446.2     $ 753.6        $ 708.4         $ 670.4

Non-performing loans to total loans           4.78%     6.49%     6.80%   12.02%(1)(5)   11.63%(1)(5)       12.30%
Non-performing assets to total assets         2.89%     2.94%     6.42%   10.21%(1)(5)   10.99%(1)(5)       11.40%
</TABLE>

______________

(1)  Includes net non-performing mortgage loans held for sale.

(2)  Excluding certain other loans delinquent 90 days or more, such as 
guaranteed student loans, on which principal and interest are guaranteed by 
the U.S. government and certain other loans on which delinquent principal and 
interest may be deducted from the borrower's deposit account balances.

(3)  As of  December 31, 1996, non-accrual loans included 2,936 one-to 
four-family loans, with an aggregate balance of $270.7 million, 460 
multi-family loans with an aggregate balance of $48.3 million, 290 commercial 
real estate loans with an aggregate balance of $36.5 million, 172 other loans 
with an aggregate balance of $0.1 million and 7 home equity loans with an 
aggregate balance of $0.5 million.

(4)  Net of related valuation allowance of $1.3 million, $2.2 million, $5.1 
million, $14.4 million, $19.5 million and,  $11.7 million for foreclosed real 
estate at December 31, 1996, 1995, 1994, 1993 and June 30, 1993 and 1992, 
respectively. 

(5)  Excluding the effect of charge-offs and the $20 million valuation 
allowance relating to the portfolio of non-performing mortgage loans held for 
sale, the Company's  ratio of non-performing loans to total loans and 
non-performing assets to total assets would have been 12.61% and 10.70% at 
December 31, 1993 and 12.27% and 11.58%, at June 30, 1993, respectively.


The following table sets forth information regarding the effect of non-accrual 
loans on interest if all non-accrual loans had been performing in accordance 
with their original terms.

                                     Year Ended December 31,
                                 -------------------------------
                                    1996       1995       1994
                                 ---------  ---------  ---------
                                          (In millions)
Interest Income
   As originally contracted       $  45.1    $  50.8    $  72.3
   As recognized                    (22.9)     (33.7)     (40.3)
   Reduction of interest income   $  22.2    $  17.1    $  32.0


At December 31, 1996, the Company's net other real estate owned totaled $28.6 
million and was held directly by the Company and by subsidiaries of the Company 
which were formed for the purpose of holding and maintaining certain other real 
estate. See "Subsidiary Activities." At such date, net other real estate owned 
was comprised of 220 one-to four-family properties with an aggregate carrying 
value of $17.5 million, 39 multi-family properties with an aggregate carrying 
value of $4.0 million and 87 commercial real estate properties with an 
aggregate carrying value of $8.4 million. The Company or an independent 
inspector generally conducts monthly external inspections on all properties 
securing loans in foreclosure and generally conducts external appraisals on all 
properties prior to taking ownership of the property. Based upon such 
inspections and appraisals, the Company will charge off any loan principal it 
deems necessary at such times. The Company or an independent inspector conducts 
weekly inspections of its foreclosed real estate and periodically adjusts its 
valuation allowance for possible declines in the value of other real estate 
owned. The Company's valuation allowance for other real estate owned at 
December 31, 1996 totaled $1.3 million, or 4.3% of the aggregate gross value of 
other real estate owned. The Company is currently offering for sale 
substantially all real estate owned as a result of foreclosure through brokers 
and through its own personnel. 

The Company's policies permit the financing of the sale of its foreclosed real 
estate on substantially the same terms applicable to its other real estate 
mortgage loans with the exception that the Company may loan up to 85% of the 
lesser of the appraised value or sales price of the foreclosed property. 


ALLOWANCE FOR POSSIBLE LOAN LOSSES 

The allowance for possible loan losses is maintained through provisions for 
possible loan losses based on management's on-going comprehensive evaluation of 
the risk inherent in its loan portfolio in consideration of the trends in its 
loan portfolio, the national and regional economies and the real estate 
markets covering the Company's portfolio. The Company's loan loss allowance 
determinations also incorporate factors and analyses which consider the 
potential principal loss associated with the loan, costs of acquiring the 
property securing the loan through foreclosure or deed in lieu thereof, the 
periods of time involved with the acquisition and sale of such property, costs 
and expenses associated with maintaining and holding the property until sale, 
and the costs associated with the Company's inability to utilize funds for 
other income producing activities during the estimated holding period of the 
property. In this regard, on at least a quarterly basis, the Company conducts: 
a review of the amount and frequency of delinquent loans which become 
non-performing and the average period of time for such loans to become 
non-performing; a review of the amount and frequency of non-accrual loans that 
are transferred to other real estate owned and the costs and average periods 
of time associated with such transfer; a review of the historical holding 
periods of foreclosed properties; a review of historical principal loss 
experience of sales of its foreclosed properties; and, based on recent sales 
activity, an analysis of the average estimated principal loss on loans in its 
portfolio. Through these analyses the Company attempts to maintain an allowance 
for possible loan losses sufficient to fund, in the aggregate, future net cash 
flow shortfalls related to the resolution of problem loans (both known and 
unknown but reasonably estimable) in its loan portfolio.  The Company believes 
that, based on its loan underwriting criteria, including its lower 
loan-to-value ratio requirements, and historical charge-off activity, which has 
historically been below other savings institutions, the Company's current level 
of allowance for possible loan losses is adequate. 

The following table sets forth the Company's allowance for possible loan losses 
at the dates and for the periods indicated. The balances below represent 
general loan loss reserves and are not allocable to specific loans in the 
Company's portfolio. 

<TABLE>
<CAPTION>
                                                                          Six Months Ended
                                                Year Ended December 31,      December 31,   Year Ended June 30,
                                          ----------------------------------------------------------------------
                                              1996        1995        1994        1993        1993        1992
                                          ----------  ----------  ----------  -----------  -----------  --------
                                                                  (Dollars in Millions)
<S>                                       <C>         <C>         <C>         <C>          <C>          <C>
Balance beginning of period                $ 105.5    $ 103.0      $ 147.0    $ 136.5      $ 130.5      $  83.8

Provisions charged to income                  15.7        9.5         32.3       25.3         63.6         59.9
Transfer from (to) allowance for 
   loans held for sale                         ---        ---         11.6        ---        (20.0)         ---
Loans charged-off:
   Mortgage loans held for investment         (4.7)      (5.3)       (15.3)      (9.4)        (5.6)        (4.2)
   Other loans                                (0.2)       ---          ---        ---          ---          ---
   Mortgage loans held for sale                ---        ---         (4.9)       ---        (20.0)         ---
   Bulk sale charge-off of 
   non-performing loans                        ---        ---        (56.1)       ---          ---          ---
   Net loan foreclosure costs                (12.6)     (10.2)       (16.8)      (6.1)       (12.0)        (9.0)
Total charge-offs                            (17.5)     (15.5)       (93.1)     (15.5)       (37.6)       (13.2)
Recoveries                                     1.3        8.5(2)       5.2        0.7          ---          ---
Balance end of period                      $ 105.0    $ 105.5      $ 103.0    $ 147.0      $ 136.5      $ 130.5
Ratio of net charge-offs during the 
   period to average loans outstanding
   during the period                          0.25%      0.12%        1.54%      0.27%        0.71%        0.27%
Ratio of allowance for possible 
   loan losses to total loans 
   receivable at the end of the period        1.41%      1.75%        1.79%      2.63%(1)     2.52%(1)     2.58%
Ratio of allowance for possible loan 
   losses to total non-performing 
   loans at the end of the period            29.48%     26.24%       26.26%     23.45%       23.70%       20.94%
</TABLE>


(1)  Excludes $52.1 million and $60.0 million, net, of non-performing mortgage 
loans held for sale at December 31, 1993 and June 30, 1993, respectively.

(2)  Includes a $6.1 million recovery of 1994's bulk sale charge off.


The following table sets forth the Company's allocation of the allowance for 
possible loan losses by loan category and the percent of loans in each category 
to total loans held for investment at December 31, 1996, 1995, 1994, 1993 and 
June 30, 1993 and 1992.  The entire allowance for possible loan losses is a 
general valuation allowance applicable to the entire loan portfolio, and the 
portion of the allowance for possible loan losses allocated to each loan 
category has been estimated for presentation purposes and does not represent a 
limitation on the total allowance available to each loan category. 

<TABLE>
<CAPTION>
                                                    At December 31,                                      At June 30,
                          -----------------------------------------------------------------  ----------------------------------
                                1996             1995            1994             1993             1993              1992
                          ---------------- ---------------- ---------------- ---------------- ---------------- ----------------
                                Percentage       Percentage       Percentage       Percentage       Percentage       Percentage
                                 of Loans         of Loans         of Loans         of Loans         of Loans         of Loans 
                                    in               in               in               in               in               in
                                 Category         Category         Category         Category         Category         Category 
                                    to               to               to               to               to               to
                                   Total            Total            Total            Total            Total            Total
                          Amount   Loans   Amount   Loans   Amount   Loans   Amount   Loans   Amount   Loans   Amount   Loans
                          ------  -------  ------  -------  ------  -------  ------  -------  ------  -------  ------  -------
                                                                     (Dollars in millions)
<S>                       <C>     <C>      <C>     <C>      <C>     <C>      <C>     <C>      <C>     <C>      <C>     <C>
Loan Category:Mortgage loans:
One-to-four family        $ 75.5   85.9%   $ 72.5   85.2%   $ 66.5   85.7%   $ 99.1   85.4%   $ 87.3   84.7%   $ 83.4   82.6%
Multi-family residential    16.0    7.3      18.2    7.9      19.8    7.9      26.2    8.2      27.0    8.5      25.8    9.7
Commercial                  13.2    6.3      14.6    6.3      16.4    6.1      21.1    5.9      21.6    6.3      20.6    7.1
Home equity loans from 
lines of credit              0.3    0.2       0.2    0.1       0.3    0.2       0.6    0.4       0.6    0.4       0.7    0.5
Other loans                  ---    0.3       ---    0.5       ---    0.1       ---    0.1       ---    0.1       ---    0.1
Total allowance for 
    possible loan losses  $105.0  100.0%   $105.5  100.0%   $103.0  100.0%   $147.0  100.0%   $136.5  100.0%   $130.5  100.0%
</TABLE>


ENVIRONMENTAL ISSUES 
The Company encounters certain environmental risks in its lending activities. 
Under federal and state environmental laws, lenders may become liable for costs 
of cleaning up hazardous materials found on property securing its loans. In 
addition, the existence of hazardous materials may make it unattractive for a 
lender to foreclose on such properties. Although environmental risks are 
usually associated with loans secured by commercial real estate, risks also may 
be substantial for loans secured by residential real estate if environmental 
contamination makes security property unsuitable for use. This could also have 
a negative effect on nearby property values. The Company attempts to control 
its risk by training its appraisers, underwriters and members of its Executive 
Mortgage Loan Committee to be cognizant of signs indicative of environmental 
hazards. Prior to foreclosure, the Company additionally conducts environmental 
risk assessments on one-to four-family properties, where the Company has an 
indication of an environmental problem, and on multi-family and commercial 
properties, which are used for activities which have a greater degree of 
environmental risk, such as dry cleaning establishments and other industrial 
uses. The Company additionally conducts housing and building code violation 
searches on all multi-family properties prior to foreclosure to assess any 
potential environmental problems. The Company currently does not make loans 
secured by gasoline stations, automobile repair facilities or properties on 
which it is known that gasoline tanks are located. As of December 31, 1996, the 
Company had 25 loans with an aggregate balance of $2.8 million secured by gas 
stations, 87 loans aggregating $9.4 million secured primarily by automobile 
repair facilities or parking facilities, and 138 loans aggregating $21.6 
million secured by factories, warehouses and other industrial buildings. At 
that date, the Company's other real estate owned included four warehouse or 
industrial properties with an aggregate carrying value of $0.4 million, all of 
which were held by a subsidiary of the Company. No gas stations or parking 
facilities were owned by the Company as of December 31, 1996. The Company has 
been named as a defendant in several legal complaints involving alleged 
ingesting of lead based paint, chips or dust by infant plaintiffs. See 
Item 3 - "Legal Proceedings."

The Company believes its procedures regarding the assessment of environmental 
risk are adequate and, as of December 31, 1996, the Company was unaware of any 
environmental issues which would subject it to any material liability at this 
time. However, no assurance can be given that the values of properties securing 
loans in the Company's portfolio will not be adversely affected by unforeseen 
environmental risks. 


INTEREST RATE RISK MANAGEMENT

Interest rate risk arises in the ordinary course of the Company's business, as 
the repricing characteristics of its mortgage loans do not necessarily match 
those of its deposit liabilities.  The resulting interest rate risk is managed 
by careful attention to the mix of asset maturities and deposit offerings and 
by adjustments to the Company's investment portfolio and the use of off balance 
sheet instruments such as interest rate swaps and options.  The investment 
strategies are designed and implemented (within policies and limits approved by 
the Board of Directors) by the Asset and Liability Management Committee, 
("ALCO") comprised of the Chief Executive Officer, the Vice Chairman and other 
Senior Management Officers.

The Company entered into interest rate swap contracts to manage interest rate 
risk.  The notional amount of these instruments are not reflected in the 
Company's balance sheet.  At December 31, 1996, the notional amount of these 
contracts approximates $300.0 million.  These contracts have a term of 
approximately 3 years, under which the Company pays an average fixed rate of 
6.33% and receives an average variable rate of 5.52%.


SECURITIES INVESTMENT ACTIVITIES 

The Board of Directors sets the securities investment policies of the Company 
and the Bank.  These policies contain guidelines and limits regarding the 
credit quality, liquidity and market risk of the securities portfolios.  

The Company's investment policy permits investments in various types of 
marketable investments including U.S. Treasury obligations, securities of 
various federal agencies, mortgage-backed securities, corporate debt 
securities, money market instruments, banker's acceptances, commercial paper 
and municipal obligations. 

The Company's money market investments consist of interest-bearing deposits in 
other banks, federal funds sold and securities purchased under agreements to 
resell ("reverse repurchase agreements"). Under these reverse repurchase 
agreements the Company advances cash at a negotiated rate of interest which is 
repaid the following business day. These agreements generally bear a higher 
rate of interest than federal funds sold and are collateralized by securities 
having market values of at least 102% of the amount of the funds advanced which 
are held by a third party custodian. 

The Company has, through a third party agent bank/custodian, a securities 
lending program whereby the Company receives a fee for lending its U.S. 
government securities to securities dealers.  The securities are collateralized 
by other U.S. government and federal agency securities having a market value of 
at least 102% of the loaned securities which are held by the third party 
bank/custodian.  Pursuant to this program, the third party agent bank 
indemnifies the Company for losses related to borrower default, market risk and 
delivery failures.

The Company designates securities as held to maturity or available for sale.  
Securities held for indefinite periods of time for use in asset/liability 
management are classified as available for sale and are carried at fair value 
with unrealized gains or losses excluded from earnings and reported as a 
separate component of stockholders' equity, net of tax.

The table below sets forth certain information regarding the carrying and 
market values of the Company's money market investments, securities available 
for sale and held to maturity.


<TABLE>
<CAPTION>
                                                                    At December 31,
                                            ----------------------------------------------------------------
                                                     1996                  1995                  1994
                                            --------------------  --------------------  --------------------
                                            Amortized     Fair    Amortized     Fair    Amortized     Fair
                                               Cost      Value       Cost      Value       Cost      Value
                                            ---------  ---------  ---------  ---------  ---------  ---------
                                                                     (In millions)
<S>                                         <C>        <C>        <C>        <C>        <C>        <C>
Money market investments (1)                $  494.1   $  494.1   $1,550.7   $1,550.7   $  265.0   $  265.0
Investment securities:
Securities available for sale:
Government and Federal agency obligations
   U.S. Treasury notes/bills                $1,944.3   $1,928.4   $1,352.3   $1,356.3   $    ---   $    ---
   Agency discount notes/Asset backed
     securities                                 66.4       66.4    2,417.0    2,417.0        ---        ---
   Mortgage-backed securities                1,881.0    1,857.9    1,668.8    1,693.8        ---        ---
   Collateralized mortgage obligation           32.4       32.4        ---        ---        ---        ---
   Trust certificates collateralized 
      by GNMA securities                       409.8      406.5      430.3      428.8        ---        ---
   Other                                        63.9       63.8        0.6        0.6        ---        ---
      Total securities available for sale   $4,397.8   $4,355.4   $5,869.0   $5,896.5   $    ---   $    ---

Securities held to maturity:
U.S. government and agencies                $    ---   $     --   $    ---   $    ---   $  703.3   $  698.2
Mortgage-backed securities                       ---        ---        ---        ---       28.4       29.1
Tax-exempt municipals                            0.6        0.6        0.7        0.7        0.7        0.6
Financial                                        3.4        3.4        3.6        3.7        3.5        3.5
Other                                            ---        ---        ---        ---        0.8        0.8
      Total securities held to maturity     $    4.0   $    4.0   $    4.3   $    4.4   $  736.7   $  732.2
</TABLE>


(1)  Consists of interest-bearing deposits in other banks, federal funds sold 
and securities purchased under resale agreements. 

The table below sets forth certain information regarding the amortized cost, 
weighted average yields and maturities of the Company's money market 
investments and debt securities at December 31, 1996.  There were no securities 
(exclusive of obligations of the U.S. government and federal agencies) issued 
by any one entity with a total carrying value in excess of 10% of stockholders' 
equity at December 31, 1996.

<TABLE>
<CAPTION>
                                                                 At December 31, 1996
                           --------------------------------------------------------------------------------------------------------
                                 One Year          One to         Five to         More than
                                 or Less         Five Years      Ten Years        Ten Years              Total Securities
                            ----------------  ---------------  -------------  ---------------  -------------------------------------
                                                                                                  Average
                                                                                                 Remaining          Estim-
                              AMOR-  WEIGHTED  AMOR-  WEIGHTED  AMOR-  WEIGHTED  AMOR-  WEIGHTED   YEARS    AMOR-    ated   WEIGHTED
                              TIZED  AVERAGE   TIZED  AVERAGE   TIZED  AVERAGE   TIZED  AVERAGE     TO      TIZED    FAIR    AVERAGE
                              COST     YIELD   COST    YIELD    COST    YIELD     COST   YIELD   MATURITY    COST    VALUE    YIELD
                             -------  ------  -------- ------- ------  ------- --------  ------ --------- --------  -------- -------
                                                                     (Dollars in millions)
<S>                          <C>      <C>     <C>      <C>     <C>     <C>     <C>       <C>    <C>       <C>       <C>      <C>
Money market investments(1)  $ 494.1   6.75%  $    ---   ---%  $  ---    ---%  $    ---   ---%  $ ---     $  494.1  $  494.1   6.75%
Securities available for sale
U.S. Treasury notes/bills    1,143.1   5.47      801.2  5.33      ---    ---        ---   ---    1.58      1,944.3   1,928.4   5.41
Agency discount notes/AsseT
  backed securities              ---    ---       18.0  6.01     48.4   5.75        ---   ---    6.11         66.4      66.4   5.82
Mortgage-backed securities       ---    ---      189.0  5.97    216.7   6.63    1,475.3  6.83   15.89(2)   1,881.0   1,857.9   6.72
Collateralized mortgage
  obligations                    ---    ---        ---   ---      ---    ---       32.4  6.61   18.73(2)      32.4      32.4   6.61
Trust certificates 
  collateralized
  by GNMA securities             ---    ---        ---   ---    409.8   5.97        ---   ---    8.90        409.8     406.5   5.97
Other                            ---    ---        ---   ---      ---    ---       63.9  5.69     ---         63.9      63.8   5.69

Total securities 
      available for sale    $1,143.1   5.47%  $1,008.2  5.46%  $674.9   6.17%  $1,571.6  6.78%            $4,397.8  $4,355.4   6.04%
Securities held to maturitY
Tax exempt municipals       $    ---    ---%  $    ---   ---%  $  ---    ---%  $    0.6  7.50%  11.33     $    0.6  $    0.6   7.50%
Financial                        ---    ---        2.2  8.25      0.1   7.77        1.1  8.00   12.41          3.4       3.4   8.16

Total securities held 
      to maturity           $    ---    ---%  $    2.2  8.25%  $  0.1   7.77%  $    1.7  7.82%            $    4.0  $    4.0   8.06%
</TABLE>


(1)  Consists of interest-bearing deposits on other banks, federal funds sold,
and securities purchased under resale agreements. 

(2)  Mortgage-backed securities are presented based upon contractual maturity.
The estimated average life of these securities, taking into account both 
scheduled and non-scheduled principal payments is 5.7 years.


During the year ended December 31, 1996, the Company sold available for sale 
securities aggregating $3.2 billion, resulting in gross realized gains of $2.7 
million and gross realized losses of $2.1 million.  There were no sales of 
securities during the years ended December 31, 1995 and 1994.


SOURCES OF FUNDS 

GENERAL. Deposits, payments on loans and mortgage-backed securities and 
maturities and redemptions of investment securities are the primary sources of 
the Company's funds for lending, investing and other general purposes. Although 
the Company has not had any borrowed funds outstanding during the periods being 
reported, the Company has access to confirmed lines of credit from an unrelated 
financial institution aggregating $35.0 million. 

DEPOSITS. The Company offers a variety of deposit accounts having a range of 
interest rates and terms. The Company's deposits consist of various types of 
savings, NOW, non-interest bearing checking, money market and certificates of 
deposit. The flow of deposits is influenced significantly by general economic 
conditions, changes in prevailing interest rates and competition. The Company's 
deposits are obtained primarily from the areas served by its consumer branch 
network.  Management determines the Company's deposit rates based upon market 
conditions and local competition. The Company relies primarily on competitive 
rates of interest, offering promotional rates, marketing and long-standing 
relationships with customers to attract and retain deposits. Certificates 
of deposit accounts in excess of $100,000 are not actively solicited by 
the Company.

At December 31, 1996, the Company had outstanding $687.8 million in 
certificates of deposit in amounts of $100,000 or more, maturing as follows: 
                                                       Weighted
                                       Amount        Average Rate
                                     ---------       ------------
                                         (Dollars in millions)
Maturity Period:
Three months or less                 $  161.0             4.89%
Over three through six months           133.4             5.09
Over six through twelve months          181.2             5.12
Over twelve months                      212.2             5.88
  Total                              $  687.8             5.29%


The following table sets forth the distribution of the Company's deposit 
accounts at the dates indicated and the weighted average nominal interest rates 
on each category of deposits presented. Management does not believe that the 
use of period end balances instead of average balances results in any material 
differences to the information presented. 

<TABLE>
<CAPTION>
                                                                    At December 31,
                                           -------------------------------------------------------------------
                                                          1996                             1995
                                           --------------------------------  ---------------------------------
                                                                   Weighted                           Weighted
                                                        Percent     Average                Percent    Average
                                                       of Total     Nominal               of Total    Nominal
                                             Amount    Deposits      Rate      Amount     Deposits      Rate
                                           ---------  ----------  ---------  ----------  ----------  ---------
                                                                   (Dollars in millions)
<S>                                        <C>        <C>         <C>        <C>         <C>         <C>
Account type:
Savings and club                           $ 1,901.7      16.60%      2.77%   $ 2,034.7      15.77%      2.79%
NOW and checking                               524.2       4.58       1.86        501.8       3.89       1.89
Variable rate savings                        1,853.7      16.19       3.36      1,995.3      15.47       3.52
Money market                                   561.3       4.90       3.25        635.7       4.93       3.31
      Total                                  4,840.9      42.27       2.88      5,167.5      40.06       2.99

Term certificates of deposit:
  Certificates of deposit over $100,000        687.8       6.01       5.29        771.0       5.98       5.72
  Certificates of deposit less than 
    $100,000 with original maturities of:
      Six months or less                       227.1       1.98       3.83        589.7       4.57       4.87
      Six to 12 months                       1,811.2      15.82       4.63      2,111.9      16.37       5.20
      12 to 30 months                        1,702.1      14.86       5.44      1,659.7      12.87       5.88
      30 to 48 months                          258.9       2.26       6.26        272.3       2.11       5.93
      48 to 72 months                          695.6       6.07       5.88        944.3       7.32       6.42
      72 to 84 months                           72.0       0.63       6.56         80.6       0.63       6.80
  IRA and Keoghs less than 3 years           1,156.7      10.10       5.08      1,301.3      10.09       5.42
      Total term certificates of deposit     6,611.4      57.73       5.17      7,730.8      59.94       5.62
      Total deposits                       $11,452.3     100.00%      4.21%   $12,898.3     100.00       4.57%
</TABLE>

                                                     At December 31
                                           --------------------------------
                                                          1994
                                           --------------------------------
                                                                   Weighted
                                                         Average    Percent
                                                         Nominal   of Total
                                              Amount    Deposits     Rate
                                           ----------  ---------  ---------
                                                 (Dollars in millions)
Account type:
Savings and club                           $   602.2      11.53%      3.15%
NOW and checking                               110.1       2.11       2.24
Variable rate savings                        1,182.9      22.65       3.25
Money market                                   427.0       8.17       3.15
      Total                                  2,322.2      44.46       3.16

Term certificates of deposit:
  Certificates of deposit over $100,000        238.0       4.56       5.83
  Certificates of deposit less than 
    $100,000 with original maturities of:
      Six months or less                       158.1       3.03       3.92
      Six to 12 months                         374.0       7.16       4.43 
      12 to 30 months                          865.2      16.55       4.70
      30 to 48 months                           37.0       0.71       5.62
      48 to 72 months                          872.4      16.70       6.81 
      72 to 84 months                           39.1       0.75       6.14
  IRA and Keoghs less than 3 years             317.5       6.08       4.48
      Total term certificates of deposit     2,901.3      55.54       5.36
      Total deposits                       $ 5,223.5     100.00%      4.38%


The following table presents, by various rate categories, the amount of 
certificates of deposit outstanding at the dates indicated.

<TABLE>
<CAPTION>
                                   At December 31,                     Maturities at December 31, 1996
                    ------------------------------------------  --------------------------------------------
                                                                 Within     One to
                       1996       1995       1994       1993    One Year  Three Years  Thereafter    Total
                    ---------  ---------  ---------  ---------  ---------  ----------  ---------  ----------
                                                        (In millions)
<S>                 <C>        <C>        <C>        <C>        <C>        <C>         <C>        <C>
Certificates of
  deposit accounts:
3.99% or less       $1,237.3   $  127.8   $  486.1   $1,013.0   $1,196.1    $   41.0    $    0.2   $1,237.3
4.00% to 4.99%       1,149.5    1,215.0      861.8      634.5      919.6       204.6        25.3    1,149.5
5.00% to 5.99%       3,166.9    3,869.6      721.9      435.2    2,086.3     1,004.9        75.7    3,166.9
6.00% to 6.99%         751.5    1,893.2      367.2      252.0      346.7       246.2       158.6      751.5
7.00% to 7.99%         297.2      606.2      306.3      352.5      153.4       116.8        27.0      297.2
8.00% to 8.99%           8.1       11.1      157.9      193.1        4.9         2.4         0.8        8.1
9.00% or greater         0.9        7.9        0.1       44.6        0.2         0.7         ---        0.9
    Total           $6,611.4   $7,730.8   $2,901.3   $2,924.9   $4,707.2    $1,616.6    $  287.6   $6,611.4
</TABLE>


SUBSIDIARY ACTIVITIES The Company has formed two subsidiaries:

GreenPoint Community Development Corp. This for-profit community development 
subsidiary was incorporated in 1993.  The subsidiary offers lending programs, 
development opportunities and assistance, consulting and other activities which 
promote the objective of greater access to affordable housing for low-and 
moderate-income persons residing in the New York metropolitan area.  GreenPoint 
Community Development Corp. is a subsidiary of the holding company.

GREENPOINT BANK. The Bank was organized in 1868 as a New York State chartered 
mutual savings bank.  On January 28, 1994, the Bank converted from the mutual 
to the stock form of ownership, and 100% of its outstanding shares were 
acquired by the Company.  The Bank is the principal subsidiary of the Company.

As of December 31, 1996, the Bank has formed ten subsidiaries:

GREENPOINT MORTGAGE CORP. This subsidiary was incorporated on October 12, 1994 
and began operations in the first quarter of 1995.  On July 7, 1995, GPMC 
acquired the wholesale residential mortgage lending business of 
BarclaysAmerican/Mortgage Corp. ("BAM").  GPMC's activities consist of the 
origination, sale and servicing of mortgage loans.

GREENPOINT MORTGAGE TRUST.  This subsidiary was incorporated on February 16, 
1996, as a real estate investment trust established for the purpose of 
acquiring, holding and managing real estate mortgage assets.

GREENPOINT PURCHASING CORP.  This subsidiary was incorporated on July 19, 1996, 
with an agreement between the Company and the Nassau County Industrial 
Development Agency.  This agreement enables the Company, on a sales tax exempt 
basis, to (1) purchase and/or lease machinery and equipment for the Lake 
Success facility and (2) renovate and improve the facility.

GREENPOINT CORPORATE OFFICER LIFE INSURANCE.  This subsidiary was incorporated 
on July 25, 1996, as an insurance trust established for the purpose of 
purchasing corporate life insurance policies for the officers of the Company.

3090 OCEAN AVENUE REALTY CORP.  This subsidiary was incorporated on June 6, 
1996, as a real estate investment subsidiary.

OTHER REAL ESTATE SUBSIDIARIES. The Bank has formed five wholly-owned 
subsidiary corporations, all of which are incorporated under the laws of the 
State of New York, for the purpose of holding and maintaining certain 
properties acquired by the Bank as a result of foreclosure proceedings or deeds 
in lieu thereof. As of December 31, 1996, four of these subsidiaries were 
active. The Bank attempts to limit the carrying value of property held by any 
one subsidiary to approximately $5 million. Accordingly, in the event the Bank 
acquires additional properties through foreclosure or deeds in lieu thereof, 
the Bank may form additional subsidiaries for the purpose of holding and 
maintaining such properties. The properties selected by the Bank to be held in 
its subsidiaries generally consist of multi-family properties with five units 
or more, commercial properties and one-to four-family properties which have 
been identified by the Bank as having attributes which may subject the Bank to 
liabilities beyond those normally associated with its other real estate such as 
properties which are not in compliance with building codes or properties with 
potential environmental problems. A description of the Bank's subsidiaries are 
set forth below: 

NEERG CORP. This  subsidiary was formed in January 1990 and currently holds 32 
properties having an aggregate carrying value of $3.1 million and an aggregate 
appraised value of $4.1 million, as of December 31, 1996, based on the 
Company's most recent appraisals.  

298 15TH STREET REALTY CORP. This subsidiary was formed in January 1993 and 
currently holds 30 properties having an aggregate carrying value of $2.8 
million and an aggregate appraised value of $3.9 million as of December 31, 
1996, based on the Company's most recent appraisals. 

NEERG SECOND CORP. This  subsidiary was formed in June 1993 and currently holds 
24 properties having an aggregate carrying value of $2.5 million and an 
aggregate appraised value of $3.2 million, as of December 31, 1996, based on 
the Company's most recent appraisals.

ALPHA REO CORPORATION.  This subsidiary was formed in March 1994 and currently 
holds 30 properties having an aggregate carrying value of $2.7 million and an 
aggregate appraised value of $3.7 million, as of December 31, 1996, based on 
the Company's most recent appraisals.

BETA REO CORP.  This subsidiary was formed in June 1994 and currently holds no 
properties.


SAVINGS BANK LIFE INSURANCE 

As an issuing Company, the Company offers Savings Bank Life Insurance ("SBLI") 
to its customers up to the legal maximum of $50,000 per insured individual and, 
as a trustee Company, offers an additional $500,000 in group coverage per 
insured under SBLI's Financial Institution Group Life Insurance policy. The 
Company also offers insurance coverage for qualifying full-time employees in 
amounts up to $1,000,000 and group mortgage life insurance in amounts up to 
$110,000. The SBLI Department's activities are segregated from the Company and, 
while they do not materially affect the Company's earnings, management believes 
that offering SBLI is beneficial to the Company's relationship with its 
depositors and the general public. The SBLI Department pays its own expenses 
and reimburses the Company for expenses incurred on its behalf. 


PERSONNEL 

As of December 31, 1996, the Company had 1,807 full-time employees and 283 
part-time employees. The employees are not represented by a collective 
bargaining unit and the Company considers its relationship with its employees 
to be good. 


FEDERAL TAXATION

Generally, the Company and its subsidiaries report income on a consolidated 
calendar year basis using the accrual method of accounting and are subject to 
federal income taxation in the same manner as other corporations with certain 
exceptions, including particularly, the Bank's addition to its tax reserve for 
bad debts as discussed below.  The following discussion of tax matters is 
intended as a summary and does not purport to be a comprehensive description of 
the tax rules applicable to the Company and its subsidiaries.  The Company has 
not been audited by the Internal Revenue Service during the last five years.

BAD DEBT RESERVES.  For tax years prior to 1996, under the Internal Revenue 
Code a special bad debt deduction for additions to the tax bad debt reserve was 
allowed.  Recently enacted federal legislation eliminated this reserve method.  
For tax years beginning after December 31, 1995, the Bank is only permitted to 
take federal deductions for bad debts on the basis of actual loan charge off 
activity (specific charge-offs).  This legislation also requires that the Bank 
recapture into taxable income the portion of existing tax bad debt reserve 
created in tax years beginning after December 31, 1987 over a six year period.  
The amount of such reserve subject to recapture at December 31, 1996 is 
approximately $2 million.

Provided the Bank continues to satisfy certain definitional tests and other 
conditions, for New York State and City income tax purposes, the Bank is 
permitted to continue to take special reserve method bad debt deductions.  The 
deductible annual addition to the state reserve may be computed using a 
specific formula based on the Bank's loss history ("Experience Method") or a 
statutory percentage equal to 32% of the Bank's New York State or City taxable 
income ("Percentage Method").  The Bank used the percentage method for 1995 and 
expects to use the percentage method for 1996.

TAXABLE DISTRIBUTIONS AND RECAPTURE. Under prior federal law, tax bad debt 
reserves created prior to January 1, 1988 were subject to recapture into 
taxable income should the Bank fail to meet certain thrift asset and 
definitional tests.  New federal legislation eliminated these thrift related 
recapture rules.  However, under current law, pre-1988 reserve remain subject 
to recapture should the Bank make certain non dividend distributions or cease 
to maintain a bank charter.  Management has no intention of taking such actions.

At December 31, 1996, the Bank's total federal pre-1988 reserve was 
approximately $140 million.  This reserve reflects the cumulative effects of 
federal tax deductions by the Bank for which no Federal income tax provision 
has been made.

The Bank also maintains a state and local tax reserve for qualifying loans in 
excess of the federal reserve for which no state and local tax has been 
provided.  The amount of the Bank's state and city tax reserve for qualifying 
loans  in excess of the Federal Reserve balance as of December 31, 1996 was 
approximately $168 million.  In the event the Bank were to allow "qualifying 
assets" to fall below 60% of total assets or otherwise fail definitional tests, 
the Bank would no longer be subject to the New York State and City reserve 
method of computing bad debt deductions as described above.  As a result, the 
Bank would record a charge relating to this balance of the then existing tax 
reserves.  Future bad debt deductions would be based on a "specific loan 
charge-off" method which is closely reflective of financial statement loan 
charge-off activity.  Management is not contemplating any actions that would 
cause recapture of the qualifying reserves into taxable income.

CORPORATE ALTERNATIVE MINIMUM TAX.  The Internal Revenue Code of 1986, as 
amended, imposes a tax on alternative minimum taxable income ("AMT") at a rate 
of 20%.  AMTI is calculated as federal taxable income adjusted for certain 
items of "tax preference".  For tax years beginning before January 1, 1996, an 
environmental tax of 0.12% of the excess of AMTI (with certain modifications) 
over $2 million, was imposed on corporations, including the Company, whether or 
not an alternative minimum tax ("AMT") was  paid.  The Company does not expect 
to be subject to the AMT.  The Company was subject to an environmental tax 
liability for the tax year ended December 31, 1995, which was not material.

DIVIDENDS RECEIVED EXCLUSION AND OTHER MATTERS.  The Company may exclude from 
its income 100% of dividends received from the Bank as a member of the same 
affiliated group of corporations.  The corporate dividends received exclusion 
is generally 70% in the case of dividends received from unaffiliated 
corporations with which the Company will not file a consolidated tax return, 
except that if the Company owns more than 20% of the stock of a corporation 
distributing a dividend, then 80% of any dividends received may be excluded.


STATE AND LOCAL TAXATION

NEW YORK STATE AND NEW YORK CITY TAXATION.  The Company and the Bank report 
income on a combined calendar year basis to both New York State and New York 
City.  New York State Franchise Tax on corporations is imposed in an amount 
equal to the greater of (a) 9% of "entire net income" allocable to New York 
State (b) 3% of "alternative entire net income" allocable to New York State 
(c) 0.01%  of the average value of assets allocable to New York State or (d) 
nominal minimum tax. Entire net income is based on federal taxable income, 
subject to certain modifications.  Alternative entire net income is equal to 
entire net income without certain modifications. The New York City Corporation 
Tax is imposed using similar alternative taxable income methods and rates.

A temporary Metropolitan Transportation Business Tax Surcharge on Banking 
corporations doing business in the Metropolitan District has been applied since 
1982.  The Company transacts a significant portion of its business within this 
District and is subject to this surcharge. For the tax year ended December 31, 
1996, the surcharge rate is 17% of the State franchise tax liability.  For 
1996, an additional 2.5% tax surcharge on the New York State Franchise Tax is 
also imposed on the Company.  New York City does not impose surcharges 
applicable to the Company.

The Company is being audited by the New York State Department of Taxation and 
Finance for the tax years 1992, 1993 and 1994.  The Company is also being 
audited by the New York City Department of Finance for the tax years 1992 and 
1993.  Management of the Company believes that any actions taken by the taxing 
authorities will not materially affect the financial condition and results of 
operations of the Company.

MULTI STATE TAXATION.  GPMC engages in mortgage lending activities in 
approximately 40 states.  Generally, GPMC is subject to tax in a state on the 
basis of income generating activities occurring within that state.  Generally, 
state taxes are imposed on allocated income, average assets or a nominal 
minimum tax.  For the tax year ended December 31, 1996,  GPMC is expected to 
file returns in most states using the allocated income alternative. 

DELAWARE STATE TAXATION.  As a Delaware holding company not earning income in 
Delaware, the Company is exempt from Delaware corporate income tax but is 
required to file an annual report with and pay an annual franchise tax to the 
State of Delaware. The tax is imposed as a percentage of the capital base of 
the Company with an annual maximum of $150,000.


BANK REGULATION AND SUPERVISION  

The Bank is a New York State chartered savings bank and its deposit accounts 
are insured up to applicable limits by the FDIC.  The Bank is subject to 
extensive regulation by the New York State Banking Department (the "Banking 
Department"), as its chartering agency, and by the FDIC, as the deposit 
insurer. The Bank must file reports with the Banking Department and the FDIC 
concerning its activities and financial condition, in addition to obtaining 
regulatory approvals prior to entering into certain transactions such as 
establishing branches, mergers with, or acquisitions of, other depository 
institutions and the acquisition of assets and the assumption of liabilities of 
other financial services companies. There are periodic examinations by the 
Banking Department and the FDIC to assess the Bank's compliance with various 
regulatory requirements. This regulation and supervision establishes a 
comprehensive framework of activities in which a savings bank can engage and is 
intended primarily for the protection of the insurance fund and depositors. The 
regulatory structure also gives the regulatory authorities extensive discretion 
in connection with their supervisory and enforcement activities and examination 
policies, including policies with respect to the classification of assets and 
the establishment of adequate loan loss reserves for regulatory purposes. Any 
change in such regulation, whether by the Banking Department, the FDIC or 
through legislation, could have a material adverse impact on the Company and 
the Bank and their operations and stockholders. The Company is also required to 
file certain reports with, and otherwise comply with the rules and regulations 
of the Board of Governors of the FRB and of the United States Securities and 
Exchange Commission ("SEC") under the federal securities laws. Certain of the 
regulatory requirements applicable to the Company and to the Bank are referred 
to below or elsewhere herein. 

NEW YORK STATE LAW. The exercise by an FDIC-insured savings bank of the lending 
and investment powers of a savings bank under the New York State Banking Law is 
limited by FDIC regulations and other federal law and regulations. In 
particular, the applicable provisions of New York State Banking law and 
regulations governing the investment authority and activities of an FDIC 
insured state-chartered savings bank have been effectively limited by the 
Federal Deposit Insurance Corporation Improvement Act of 1991 ("FDICIA") and 
the FDIC regulations issued pursuant thereto. See "Federal Deposit Insurance 
Corporation Improvement Act of 1991-Restrictions on State-Chartered Banks."

The Bank derives its lending, investment and other authority primarily from the 
applicable provisions of New York State Banking Law and the regulations of the 
Banking Department, as limited by FDIC regulations. See "Federal Deposit 
Insurance Corporation Improvement Act of 1991-Restrictions on State-Chartered 
Banks." Under these laws and regulations, savings banks, including the Bank, 
may invest in real estate mortgages, consumer and commercial loans, certain 
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 subject to specified 
limits. 

New York State chartered savings banks may also invest in subsidiaries under 
their service corporation investment power. A savings bank may use this power 
to invest in corporations that engage in various activities authorized for 
savings banks, plus any additional activities which may be authorized by the 
Banking Department. Investment by a savings bank in the stock, capital notes 
and debentures of its service corporations is limited to 3% of the bank's 
assets, and such investments, together with the bank's loans to its service 
corporations, may not exceed 10% of the savings bank's assets.

Under the New York State Banking Law, the Superintendent may issue an order to 
a New York State chartered Banking institution to appear and explain an 
apparent violation of law, to discontinue unauthorized or unsafe practices and 
to keep prescribed books and accounts. Upon a finding by the Banking Department 
that any director, employee or officer of any banking organization has violated 
any law, or has continued unauthorized or unsafe practices in conducting the 
business of the banking organization after having been notified by the 
Superintendent to discontinue such practices, such director, employee or 
officer may be removed from office after notice and an opportunity to be heard. 
The Bank does not know of any past or current practice, condition or violation 
that might lead to any proceeding by the Superintendent or the Banking 
Department against the Bank or any of its directors, officers or employees.  

FEDERAL DEPOSIT INSURANCE CORPORATION IMPROVEMENT ACT OF 1991. On December 19, 
1991, FDICIA became law. While FDICIA primarily addresses required capital 
levels of insured institutions, and prompt corrective action for such 
institutions as capital levels decline, it also imposes a number of new 
mandatory supervisory measures on commercial banks, savings banks and savings 
associations. 

FDICIA requires financial institutions to take certain actions relating to 
their internal operations, including: providing annual reports on financial 
condition and management to the appropriate federal banking regulators, having 
an annual audit of financial statements performed by an independent public 
accountant and establishing an independent audit committee comprised solely of 
outside directors.  FDICIA and its implementing regulations also mandates 
certain operational and managerial standards on financial institutions relating 
to internal controls, loan documentation, credit underwriting, interest rate 
exposure, asset growth, compensation, fees and benefits. 

RESTRICTIONS UPON STATE-CHARTERED BANKS.  FDICIA added new Section 24 to the 
Federal Deposit Insurance Act (the "FDI Act") which generally limits the 
activities and equity investments of state-chartered FDIC insured banks and 
their subsidiaries to those permissible for national banks and their 
subsidiaries, unless such activities and investments are specifically exempted 
by Section 24 thereof ("Section 24") or consented to by the FDIC.

In October 1992, the FDIC adopted final regulations governing the equity 
investments of such banks, effective on December 9, 1992, which generally 
prohibit equity investments in securities and real estate by such banks and 
require the divestiture of such investments by December 19, 1996. Section 24 
provides an exception for investments in common and preferred stocks listed on 
a national securities exchange or the shares of registered investment companies 
by a bank if (1) the bank held such types of investments during the 14 month 
period from September 30, 1990 through November 26, 1991, (2) the state in 
which the bank is chartered permitted such investments as of September 30, 
1991, and (3) the bank notifies the FDIC and obtains approval from the FDIC to 
make or retain such investments. Upon receiving such FDIC approval, an 
institution's investment in such equity securities will be subject to an 
aggregate limit up to its core capital. Section 24 also contains an exception 
for certain majority owned subsidiaries. Any bank holding impermissible equity 
investments that do not receive FDIC approval must submit to the FDIC a plan 
for divesting such investments as quickly and prudently as possible. 

In December 1993 the FDIC adopted final regulations pertaining to the activity 
restrictions imposed upon insured savings banks and their subsidiaries by 
Section 24. Savings banks not engaging in such activities but that desire to 
engage in otherwise impermissible activities may apply for approval from the 
FDIC to do so if such bank  meets its minimum capital requirements. The FDIC 
will not approve an activity that it determines to present a significant risk 
to the FDIC insurance funds.  

PROMPT CORRECTIVE ACTION.  FDICIA also establishes a system of prompt 
corrective action to resolve the problems of undercapitalized institutions. The 
FDIC, FRB, the Office of the Comptroller of the Currency ("OCC") and the Office 
of Thrift Supervision ("OTS") have adopted final rules, effective December 19, 
1992, which require such regulators to take certain supervisory actions against 
undercapitalized institutions, the severity of which depends upon the 
institution's degree of capitalization. Regulatory action taken will depend on 
the level of capitalization of the institution and may range from restrictions 
on capital distributions and dividends to seizure of the institution. 
Generally, subject to a narrow exception, FDICIA requires the Banking regulator 
to appoint a receiver or conservator for an institution that is critically 
undercapitalized within 90 days after becoming critically undercapitalized. 

The final rule adopted by the FDIC on September 15, 1992, to implement the 
prompt corrective action section of FDICIA, generally provides that an insured 
institution that has a total capital to risk-based assets ratio of less than 
8.0%, core capital to risk-based assets of less than 4.0% or core capital to 
total assets ("leverage capital ratio") of less than 4.0% would be considered 
to be "undercapitalized." An insured institution that has total capital to 
risk-based assets of less than 6.0%, core capital to risk-based assets of less 
than 3.0% or a leverage capital ratio that is less than 3.0% would be 
considered to be "significantly undercapitalized" and an insured institution 
that has a tangible capital to assets ratio equal to or less than 2.0% would be 
deemed to be "critically undercapitalized." See "Capital Maintenance." 
Generally, under the rule, an insured institution that is "undercapitalized," 
"significantly undercapitalized" or "critically undercapitalized" becomes 
immediately subject to certain regulatory restrictions, including, but not 
limited to, restrictions on growth, investment activities, capital 
distributions and affiliate transactions. The filing of a capital restoration 
plan, which must be guaranteed by any parent holding company, is also required. 
In addition, "critically undercapitalized" institutions must receive prior 
written approval from the FDIC to engage in any material transaction other than 
in the normal course of business.

INSURANCE OF DEPOSIT ACCOUNTS. The Bank is a member of the Bank Insurance Fund 
("BIF") of the FDIC.  As a result of the HSA acquisition, approximately 76% of 
the Bank's deposits (or approximately $9.86 billion), are insured by the BIF, 
while the remainder, (or approximately $3.04 billion), are insured by the 
Savings Association Insurance Fund ("SAIF") of the FDIC.  Deposit insurance 
premium rates on the Bank's BIF-insured deposits are currently 1.296 and 6.48 
basis points on the Bank's SAIF deposits.

Under the FDI Act, insurance of deposits may be terminated by the FDIC upon a 
finding that the institution has engaged in unsafe or unsound practices, is in 
an unsafe or unsound condition to continue operations or has violated any 
applicable law, regulation, rule, order or condition imposed by the FDIC. The 
management of the Bank does not know of any practice, condition or violation 
that might lead to termination of deposit insurance. At December 31, 1996, the 
Bank's capital exceeded the capital requirements imposed by the FDIC. 

CAPITAL MAINTENANCE. FDIC regulations require insured banks, such as the Bank, 
to maintain minimum levels of capital. The regulations establish a minimum 
leverage capital ratio requirement of not less than 3% for banks that receive 
the highest examination rating awarded by the FDIC. For all other banks, the 
minimum leverage capital requirement is 3% plus an additional cushion of at 
least 100 to 200 basis points. Tier 1 capital (also referred to as "Core 
capital") is comprised of the sum of common stockholders' equity, 
non-cumulative perpetual preferred stock (including any related surplus) and 
minority interests in consolidated subsidiaries, minus all intangible assets 
(other than qualifying servicing rights). At December 31, 1996, the Bank's 
ratio of Tier 1 capital to total assets equaled 6.64%, which exceeded the 
minimum leverage requirement.  

The FDIC also requires that savings banks meet a risk-based capital standard. 
The risk-based capital standard requires the maintenance of total capital 
(which is defined as core capital and supplementary capital) to risk-weighted 
assets of at least 8% and Tier 1 capital to risk-weighted assets of at least 
4%. In determining the amount of risk-weighted assets, all assets, plus certain 
off-balance sheet items, are multiplied by a risk-weight of 0% to 100%, based 
on the risks the FDIC believes are inherent in the type of asset or off-balance 
sheet item. The components of core capital are equivalent to those discussed 
above under the leverage capital ratio requirement. The components of 
supplementary capital currently include cumulative perpetual preferred stock, 
perpetual preferred stock, mandatory convertible securities, subordinated debt, 
intermediate preferred stock and allowance for possible loan and lease losses. 
Allowance for possible loan and lease losses includable in supplementary 
capital is limited to a maximum of 1.25% of risk-weighted assets. Overall, the 
amount of capital counted toward supplementary capital cannot exceed 100% of 
Tier 1 capital. 

At December 31, 1996, the Bank's total capital to risk-weighted assets 
("risk-based capital ratio") was 16.40% and its Tier 1 capital to risk-weighted 
assets ("Tier 1 risk-based capital ratio") was 15.15%, which exceeded the FDIC 
risk-based capital requirements. 

LOANS-TO-ONE-BORROWER LIMITATIONS.   With certain limited exceptions, a New 
York State chartered savings bank may not make loans or extend credit for 
commercial, corporate or business purposes (including lease financing) to a 
single borrower, the aggregate amount of which would be in excess of 15% of the 
bank's net worth. The Bank currently complies with all applicable 
loans-to-one-borrower limitations. 

FDICIA requires the federal banking agencies to revise their risk-based capital 
guidelines to, among other things, take adequate account of interest rate risk. 
The federal banking agencies continue to consider modifications of the capital 
requirements applicable to banking organizations.  In August 1995, the Federal 
banking agencies amended their risk-based capital guidelines to provide that 
the banking agencies will include in their evaluations of a bank's capital 
adequacy an assessment of the bank's exposure to declines in the economic value 
of the bank's capital due to changes in interest rates.  The agencies also 
issued a proposed policy statement that describes the process that the agencies 
will use to measure and assess the exposure of a bank's capital to changes in 
interest rates.  The agencies would issue proposed regulations for establishing 
explicit charges against capital to account for interest rate risk.

STANDARDS FOR SAFETY AND SOUNDNESS.   The FDI Act, as amended by FDICIA and the 
Riegle Community Development and Regulatory Improvement Act of 1994 ("Community 
Development Act"), requires the FDIC, together with the other federal bank 
regulatory agencies, to prescribe standards, by regulations or guidelines, 
relating to internal controls, information systems and internal audit systems, 
loan documentation, credit underwriting, interest rate risk exposure, asset 
growth, assets quality, earnings, stock valuation, and compensation, fees and 
benefits and such other operational and managerial standards as the agencies 
deem appropriate.  The FDIC and the federal bank regulatory agencies have 
adopted, effective August 9, 1995, a set of guidelines prescribing safety and 
soundness standards pursuant to FDICIA as amended.  The guidelines establish 
general standards relating to internal controls and information systems, 
internal audit systems, loan documentation, credit underwriting, interest rate 
exposure, asset growth, and compensation, fees and benefits.  In general, the 
guidelines require, among other things, appropriate systems and practices to 
identify and manage the risks and exposures specified in the guidelines.  In 
addition, the FDIC adopted regulations that authorize, but do not require, the 
FDIC to order an institution that has been given notice by the FDIC that it is 
not satisfying any of such safety and soundness standards to submit a 
compliance plan.  If, after being so notified, an institution fails to submit 
an acceptable compliance plan or fails in any material respect to implement an 
accepted compliance plan, the FDIC must issue an order directing action to 
correct the deficiency and may issue an order directing other actions of the 
types to which an undercapitalized association is subject under the "prompt 
corrective action" provisions of FDICIA.  If an institution fails to comply 
with such an order, the FDIC may seek to enforce such order in judicial 
proceedings and to impose civil money penalties.

ANNUAL INDEPENDENT AUDIT AND REPORTING REQUIREMENTS.  On June 2, 1993, the FDIC 
adopted a final rule and related guidelines implementing the external audit, 
audit committee and management reporting requirements of Section 36 of the FDI 
Act. Under the FDIC rule, each insured depository institution with $500 million 
or more in total assets as of the beginning of each fiscal year after December 
31, 1992 must have an annual audit of its financial statements by an 
independent accountant in accordance with GAAP and file an annual report with 
the FDIC, its primary federal regulator and any appropriate state Banking 
agency. For an insured depository institution that is a subsidiary of a holding 
company, the independent audit requirement of the rule may be satisfied by 
audited financial statements of the consolidated holding company. The annual 
report required by the rule must contain: financial statements audited by an 
independent public accountant; a statement of management's responsibilities for 
preparing the annual financial statements, establishing and maintaining 
adequate internal controls and procedures for financial reporting, and 
complying with laws, regulations, or guidelines relating to safety and 
soundness designated by the FDIC and the appropriate Federal Banking agency; a 
separate assessment by management on the effectiveness of the internal controls 
and procedures and the institution's compliance with the designated safety and 
soundness laws, regulations and guidelines; and the independent public 
accountant's report on management's assertions concerning the internal controls 
and procedures. 

In addition, insured depository institutions with total assets of $500 million 
or more are required to establish an audit committee comprised entirely of 
independent outside directors to review the annual audit findings and reports 
with management and the independent public accountant. There are more stringent 
criteria for audit committees of institutions with $3 billion or more in total 
assets, such as the Bank, including the requirements that at least two 
committee members have banking or related financial management experience and 
that the committee have access to its own outside counsel.  The Bank has an 
audit committee in place which complies with this requirement. 

EXTENSION OF CREDIT.   Under FDICIA, the federal banking agencies are required 
to adopt uniform regulations prescribing standards for extensions of credit 
that are secured by liens on interests in real estate or made for the purpose 
of financing the construction of a building or other improvements to real 
estate.  Under joint regulations adopted by the banking agencies, which became 
effective March 19, 1993, all financial institutions must adopt and maintain 
written policies that establish appropriate limits and standards for extensions 
of credit that are secured by liens or interests in real estate or are made for 
the purpose of financing permanent improvements to real estate.  These policies 
must establish loan portfolio diversification standards, prudent underwriting 
standards (including loan-to-value limits) that are clear and measurable, loan 
administration procedures, and documentation, approval and reporting 
requirements.  The real estate lending policies must reflect consideration of 
the interagency Guidelines for Real Estate Lending Policies that have been 
adopted by the federal bank regulators.

COMMUNITY REINVESTMENT ACT. Under the Community Reinvestment Act ("CRA"), as 
implemented by FDIC regulations, a savings institution has a continuing and 
affirmative obligation consistent with its safe and sound operation to help 
meet the credit needs of its entire community, including low and moderate 
income neighborhoods. The CRA does not establish specific lending requirements 
or programs for financial institutions nor does it limit an institution's 
discretion to develop the types of products and services that it believes are 
best suited to its particular community. The CRA requires the FDIC, in 
connection with its examination of a savings institution, to assess the 
institution's record of meeting the credit needs of its community and to take 
such record into account in its evaluation of certain applications by such 
institution.  The CRA requires public disclosure of an institution's CRA rating 
and requires the FDIC to provide a written evaluation of an institution's CRA 
performance utilizing a four-tiered descriptive rating system. The Bank's 
latest CRA rating received during 1996 from the FDIC, was "outstanding", the 
highest rating available. 

NEW YORK STATE REGULATION.   New York State also requires banking institutions 
organized in New York State to serve the credit needs of its local community 
("NYCRA"), which are substantially similar to those imposed by the CRA. 
Pursuant to the NYCRA, a bank is subject to an annual review by the Banking 
Department in regards to a bank's CRA performance. The NYCRA requires the 
Banking Department to make an annual written assessment of a bank's compliance 
with the NYCRA, utilizing a four-tiered rating system, and make such assessment 
available to the public. The NYCRA also requires the Superintendent to consider 
a bank's NYCRA rating when reviewing a bank's application to engage in certain 
transactions, including mergers, asset purchases and the establishment of 
branch offices or automated teller machines, and provides that such assessment 
may serve as a basis for the denial of any such application. The Bank's NYCRA 
rating, received at its last review from the Banking Department in 1996, was 
"outstanding", the highest rating available. 

FEDERAL RESERVE SYSTEM.   Under FRB regulations, the Bank is required to 
maintain non-interest-earning reserves against its transaction accounts 
(primarily NOW and regular checking accounts). The FRB regulations generally 
require that an institution maintain reserves of 3% against aggregate 
transaction accounts of $52.0 million or less (subject to adjustment by the 
FRB) plus 10% (subject to adjustment by the FRB between 8% and 14%) against 
that portion of total transaction accounts in excess of $52.0 million. The 
first $4.3 million of otherwise reservable balances (subject to adjustments by 
the FRB) are exempted from the reserve requirements. The Bank is in compliance 
with the foregoing requirements. Because required reserves must be maintained 
in the form of either vault cash, a non-interest-bearing account at a Federal 
Reserve Bank or a pass-through account as defined by the FRB, the effect of 
this reserve requirement is to reduce the Bank's interest-earning assets. 

INTERSTATE BANKING AND BRANCHING.   In the past, interstate banking has been 
limited under the Bank Holding Company Act (the "BHCA") to those states that 
permitted interstate banking by statute.  New York was one of a number of 
states that, subject to the reciprocity conditions of the New York Banking Law 
(the "Banking Law"), permitted out-of-state bank holding companies to acquire 
New York banks.  By 1994, most states had adopted statutes permitting 
multistate bank holding companies.  The Riegle-Neal Interstate Banking and 
Branching Efficiency Act of 1994 ("Interstate Banking Act") was enacted on 
September 29, 1994.  The Interstate Banking Act now permits approval under the 
BHCA of the acquisition by a bank holding company that is well capitalized and 
managed of a bank outside the holding company's home state regardless of 
whether the acquisition is permitted under the law of the state of the acquired 
bank.  The Federal Reserve Board may not approve an acquisition under the BHCA 
that would result in the acquiring holding company controlling more than 10% of 
the deposits in the United States or more than 30% of the deposits in any 
particular state.

In the past, branching across state lines was not generally available to a 
state bank, such as the Bank.  Out-of-state branches are authorized under the 
Banking Law, but similar authority does not exist generally under the laws of 
most other states.  The Interstate Banking Act, beginning June 1, 1997, permits 
the responsible banking agencies to approve merger transactions between banks 
located in different states, regardless of whether the merger would be 
prohibited under state law.  Accordingly, the Interstate Banking Act will 
permit a bank to have branches in more than one state.  A state may "opt in" to 
the provisions of the Interstate Banking Act prior to June 1, 1997, and a state 
may "opt out" of the provisions of the Interstate Banking Act by adopting 
appropriate legislation before that date.

The Interstate Banking Act will facilitate the consolidation of the banking 
industry that has taken place over recent years and will allow the creation of 
larger, presumably more efficient, banking networks, which may affect the 
competition the Bank faces in the future.  The effect of the Interstate Banking 
Act on the Bank, if any, is likely to occur as banking institutions, state 
legislators and bank regulators respond to the new federal regulatory 
structure.  The states will have to establish appropriate corporate law, tax 
and regulatory structures to adjust to the growth of new interstate banks.

DIVIDEND RESTRICTIONS.   New York law imposes certain restrictions on the 
payment of dividends, including a provision that, without regulatory approval, 
the Bank cannot declare and pay dividends in any calendar year in excess of its 
"net profits"  for such year combined with its "retained net profits" of the 
two preceding years, less any required transfer to surplus.


HOLDING COMPANY REGULATION AND SUPERVISION 

FEDERAL REGULATION. The Company is a registered bank holding company pursuant 
to the Bank Holding Company Act of 1956, as amended ("BHCA"). 

The Company is subject to examination, regulation and periodic reporting under 
the BHCA, as administered by the FRB. The FRB has adopted capital adequacy 
guidelines for bank holding companies (on a consolidated basis) substantially 
similar to those of the FDIC for the Bank.

The Company is required, under certain circumstances, to obtain the prior 
approval of the FRB to acquire all, or substantially all, of the assets of any 
bank or bank holding company. Prior FRB approval is required for the Company to 
acquire direct or indirect ownership or control of any voting securities of any 
bank or bank holding company if, after giving effect to such acquisition, it 
would, directly or indirectly, own or control more than 5% of any class of 
voting shares of such bank or bank holding company. The BHCA also prohibits the 
acquisition by the Company of more than 5% of the voting shares, or 
substantially all the assets of a bank located outside the State of New York 
unless such an acquisition is specifically authorized by the laws of the state 
in which such bank is located. New York State banking law permits the 
interstate acquisition of banking institutions by bank holding companies on a 
nationwide and reciprocal basis. See Item 5 "Restrictions on Acquisition of 
the Company and the Bank. "In addition to the approval of the FRB, before any 
bank acquisition can be completed, prior approval thereof may also be required 
to be obtained from other agencies having supervisory jurisdiction over the 
bank to be acquired, including the Banking Department.

The Company is required to give the FRB prior written notice of any purchase or 
redemption of its outstanding equity securities if the gross consideration for 
the purchase or redemption, when combined with the net consideration paid for 
all such purchases or redemptions during the preceding 12 months, is equal to 
10% or more of the Company's consolidated net worth. The FRB may disapprove 
such a purchase or redemption if it determines that the proposal would 
constitute an unsafe and unsound practice, or would violate any law, 
regulation, FRB order or directive, or any condition imposed by, or written 
agreement with, the FRB. 

The status of the Company as a registered bank holding company under the BHCA 
does not exempt it from certain federal and state laws and regulations 
applicable to corporations generally, including, without limitation, certain 
provisions of the federal securities laws. 

In addition, a bank holding company is generally prohibited from engaging in, 
or acquiring direct or indirect control of any company engaged in non-banking 
activities. One of the principal exceptions to this prohibition is for 
activities found by the FRB to be so closely related to banking or managing or 
controlling banks as to be a proper incident thereto. Some of the activities 
that the FRB has determined by regulation to be closely related to banking are: 
(i) making or servicing loans; (ii) performing certain data processing 
services; (iii) providing discount brokerage services; (iv) acting as a 
fiduciary, investment or financial advisor; (v) leasing personal or real 
property; (vi) making investments in corporations or projects designed 
primarily to promote community welfare; and (vii) acquiring a savings and loan 
association.

Under the FDI Act, depository institutions are liable to the FDIC for losses 
suffered or anticipated by the FDIC in connection with the default of a 
commonly controlled depository institution or any assistance provided by the 
FDIC to such an institution in danger of default. This law would have potential 
applicability if the Company ever acquired as a separate subsidiary a 
depository institution in addition to the Bank. 

Subsidiary  banks of a bank holding company are subject to certain quantitative 
and qualitative restrictions imposed by the Federal Reserve Act on any 
extension of credit to, or purchase of assets from, or letter of credit issued 
on behalf of, the bank holding company or its subsidiaries, and on the 
investment in or acceptance of stocks or securities of such holding company or 
its subsidiaries as collateral for loans. In addition, provisions of the 
Federal Reserve Act and federal regulations limit the amounts of, and establish 
required procedures and credit standards with respect to, loans and other 
extensions of credit to officers, Directors and principal shareholders of the 
Bank, the Company, any subsidiary of the Company and related interests of such 
persons. Moreover, subsidiaries of bank holding companies are prohibited from 
engaging in certain tie-in arrangements (with the Company or any of its 
subsidiaries) in connection with any extension of credit, lease or sale of 
property or furnishing of services. 

The Company and its subsidiary, the Bank, will be affected by the monetary and 
fiscal policies of various agencies of the United States Government, including 
the Federal Reserve System. In view of changing conditions in the national 
economy and in the money markets, it is impossible for management of the 
Company to accurately predict future changes in monetary policy or the effect 
of such changes on the business or financial condition of the Company. 

NEW YORK STATE BANK HOLDING COMPANY REGULATION. In addition to federal bank 
holding company regulations, a bank holding company organized or doing business 
in New York State may be also subject to regulation under the New York State 
Banking Law. The term "bank holding company," for the purposes of the New York 
State Banking Law, is defined generally to include any person, company or trust 
that directly or indirectly either controls the election of a majority of the 
directors or owns, controls or holds with power to vote more than 10% of the 
voting stock of a bank holding company or, if the company is a banking 
institution, another banking institution, or 10% or more of the voting stock of 
each of two or more banking institutions. In general, a bank holding company 
controlling, directly or indirectly, only one banking institution is not deemed 
to be a bank holding company for the purposes of the New York State Banking 
Law. Under New York State Banking Law, the prior approval of the Banking 
Department is required before: (1) any action is taken that causes any company 
to become a bank holding company; (2) any action is taken that causes any 
banking institution to become or to be merged or consolidated with a subsidiary 
of a bank holding company; (3) any bank holding company acquires direct or 
indirect ownership or control of more than 5% of the voting stock of a banking 
institution; (4) any bank holding company or subsidiary thereof acquires all or 
substantially all of the assets of a banking institution; or (5) any action is 
taken that causes any bank holding company to merge or consolidate with another 
bank holding company. Additionally, certain restrictions apply to New York 
State bank holding companies regarding the acquisition of banking institutions 
which have been chartered five years or less and are located in smaller 
communities. Officers, directors and employees of New York State bank holding 
companies are subject to limitations regarding their affiliation with 
securities underwriting or brokerage firms and other bank holding companies and 
limitations regarding loans obtained from its subsidiaries. Although the 
Company is not currently a bank holding company for purposes of New York State 
law, any future acquisition of ownership, control, or the power to vote 10% or 
more of the voting stock of another bank or bank holding company would cause it 
to become such.

ACQUISITION OF THE COMPANY-FEDERAL RESTRICTIONS. Under the Federal Change in 
Bank Control Act ("CIBCA"), a notice must be submitted to the FRB if any person 
(including a company), or group acting in concert, seeks to acquire 10% or more 
of the Company's shares of Common Stock outstanding, unless the FRB has found 
that the acquisition will not result in a change in control of the Company. 
Under the CIBCA, the FRB has 60 days within which to act on such notice, taking 
into consideration certain factors, including the financial and managerial 
resources of the acquirer, the convenience and needs of the communities served 
by the Company and the Bank, and the anti-trust effects of the acquisition. 
Under the BHCA, any company would be required to obtain prior approval from the 
FRB before it may obtain "control" of the Company within the meaning of the 
BHCA. Control generally is defined to mean the ownership or power to vote 25 
percent or more of any class of voting securities of the Company or the ability 
to control in any manner the election of a majority of the Company's directors. 
See "Holding Company Regulation."

NEW YORK STATE CHANGE-IN-CONTROL RESTRICTIONS. In addition to the CIBCA, the 
New York State Banking Law generally requires prior approval of the New York 
State Banking Board before any action is taken that causes any company to 
acquire direct or indirect control of a banking institution which is organized 
in New York State. See "Restrictions on Acquisition of the Company and the 
Bank-Regulatory Restrictions-New York State Change-in-Control Regulation." 

FEDERAL SECURITIES LAW. The Company's Common Stock is registered with the SEC 
under the Securities Exchange Act of 1934, as amended (the "Exchange Act"). The 
Company is subject to the information, proxy solicitation, insider trading 
restrictions and other requirements under the Exchange Act. 


ITEM 2.  PROPERTIES

The Company's executive office is located at 90 Park Avenue, New York, New 
York.  This location contains approximately 41.1 thousand square feet of 
commercial office space, located on the 4th floor, which the Company leases.  
The Company also has an operating center at 1981 Marcus Avenue, Lake Success, 
New York.  This location contains approximately 105.3 thousand square feet of 
commercial office space, which the Company leases.

The Company operates its consumer banking activities out of 76 branches located 
throughout the New York Metropolitan area.

The Company operates its mortgage lending activities from its Lake Success 
operating center, as well as Charlotte,  North Carolina and Englewood Cliffs, 
New Jersey.  Hub offices are located in California, Connecticut, Florida, 
Illinois, Massachusetts, Pennsylvania, Texas and Virginia.


ITEM 3.  LEGAL PROCEEDINGS 

PENDING LITIGATION 

With the exception of the matters set forth below, the Company is not involved 
in any pending legal proceedings other than routine legal proceedings occurring 
in the ordinary course of business which, in the aggregate, involve amounts 
which are believed by management to be immaterial to the consolidated financial 
statements of the Company.  The Bank has been named as a defendant in thirteen 
unrelated legal complaints which assert that infant plaintiffs sustained 
personal injuries from the ingestion of lead based paint, chips or dust.  
Additionally, there are eleven other instances of threatened litigation. The 
complaints are in various early stages of discovery.  Outside counsel has 
advised the Bank that because discovery on these claims has only recently 
begun, counsel is not yet in a position to express an opinion as to the Bank's 
liability or to quantify the Bank's potential exposure, if any, in dollar terms 
at this time.  The Company currently believes that such liability exposure, if 
any, would not be material to the Bank's financial condition.


ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

No matter was submitted to the Company's shareholders during the quarter ended 
December 31, 1996.


ITEM 4A.  EXECUTIVE OFFICERS

The following sets forth certain information regarding the individuals who are 
deemed to be executive officers of the Company.

THOMAS S. JOHNSON, 56, has been the Chairman, President and Chief Executive 
Officer of the Company and of the Bank since joining the Company in August 
1993.  Mr. Johnson has served as President of both Chemical Bank and 
Manufacturers Hanover Trust Company.  He is a Director of R.R. Donnelley & Sons 
Company, a printing company, Online Resources & Communications Corporation, and 
of a trustee of not-for-profit organizations including The Institute of 
International Education, The Asia Society, The United States Japan Foundation, 
WNET Channel 13, New York and Trinity College.  A graduate of Trinity, Mr. 
Johnson received a masters degree in business administration from Harvard 
University.

BHARAT B. BHATT, 53, joined the Company in July 1995 and serves as Vice 
Chairman of the Company and the Bank.  Prior to joining the Company, Mr. Bhatt 
was the Chief Financial Officer of Shawmut National Corporation (1992 -1994),  
Senior Vice President at Mellon Bank (1989-1992) and Vice President at Chemical 
Bank (1971-1989).  Mr. Bhatt attended the Management Program at Harvard 
Business School.  Mr. Bhatt holds a Bachelor of Laws and a Bachelor of Commerce 
degree from the University of Bombay.  Mr. Bhatt is also a member of the 
Institute of Chartered Accountants.

BERNADETTE ARIAS, 50, joined the Bank in 1963 and serves as an Executive Vice 
President of the Company and the Bank.  Her primary area of responsibility is 
Consumer Banking Services.  Mrs. Arias holds an undergraduate degree in 
Accounting and a graduate degree in Marketing from New York University.  She is 
a Board Member of the Helen Keller Services for the Blind and the Futures in 
Education foundation.

MARTIN S. DASH, 54, joined the Bank in 1964 and serves as an Executive Vice 
President of the Company and the Bank.  His primary area of responsibility is 
Mortgage Lending and Servicing.  Mr. Dash holds a Business Degree from Bernard 
Baruch School of Business Administration of the City University of New York and 
studied toward a masters degree in business administration at the Bernard M. 
Baruch Graduate Business School.  Mr. Dash is on the Board of the New York 
Hospital Medical Center of Queens' Advisory Board and is a member of various 
community and industry organizations including the Board of Managers of the 
Flushing/Bayside YMCA and the YMCA of Greater New York.

CHARLES P. RICHARDSON, 50, joined the Company in April, 1993 and serves as the 
Company's and Bank's Executive Vice President and Chief Financial Officer.  Mr. 
Richardson holds a business degree in Accounting from Temple University.  Prior 
to his joining the Company, Mr. Richardson was Executive Vice President and 
Chief Financial Officer for Dollar Dry Dock Bank (1985-1992) and was a banking 
and thrift industry consultant (1992-1993).

HOWARD C. BLUVER, 40, joined the Company and the Bank in June 1994 as Senior 
Vice President, General Counsel and Secretary.  Mr. Bluver is a graduate of the 
State University of New York at Albany and the State University of New York at 
Buffalo School of Law.  Prior to joining the Company and the Bank, he served as 
Deputy Chief Counsel for Corporate Transactions in the United States Treasury 
Department's Office of Thrift Supervision.  Prior thereto, he was in the 
private practice of law.

RAMESH SHAH, 48, joined the Bank in June 1996 as Executive Vice President, 
Marketing and Product Development.  Mr. Shah holds a Masters in Business 
Administration from Columbia University and a Bachelor of Arts degree from 
Bates College.  Prior to joining the Bank, Mr. Shah was Senior Vice President 
of NatWest Bancorp. (1994 - 1996); Senior Vice President of Shearson Lehman 
Brothers (1991 - 1994) and Senior Vice President of American Express Company 
(1988 - 1991).

JEFFREY LEEDS, 51, joined the Bank in September 1995 as Senior Vice President 
and Treasurer.  Mr. Leeds earned a Bachelor's Degree in economics from the 
University of Michigan and holds a Masters in Business Administration and 
Master of Philosophy from the Columbia University Graduate School of Business.  
Prior to joining the Bank, Mr. Leeds held a variety of positions at Chemical 
Bank.  His final assignment was as Head of the Asset and Liability Management 
staff.  Prior to that he served for seven years as Chief Money Market 
Economist.  Mr. Leeds began his career as an economist at the First National 
Bank of Chicago.  He also spent two years as Director of New Product 
Development at the Chicago Board Options Exchange. 

RALPH HALL, 47, is President and Chief Executive Officer of GreenPoint Mortgage 
Corp.  Mr. Hall had been General Manager, Chief Operating Officer and Director 
of General Motors Acceptance Corporation (GMAC) Mortgage from 1992 to 1994; and 
President, Chief Executive Officer and a Director of GMAC Capital Corp. from 
1988 to 1992.  Mr. Hall began his mortgage career at Citicorp Mortgage, Inc. 
from 1986 to 1988; his last position at the Company being Vice President of 
Operations and Product Development.  Previously, he was a Senior Consulting 
Manager with Arthur Anderson & Co. from 1978 to 1986.  Ralph Hall served in the 
United States Marine Corps from 1967 to 1971.  Mr. Hall holds a MBA at the 
University of Houston (1977) and a BS/BA in Accounting and Economics at 
Southwest Missouri State University (1974). 



                                   PART II 

ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

The Company's Common Stock is currently listed on the New York Stock Exchange 
(NYSE) under the symbol "GPT."  Trading in the Company's stock commenced on 
January 28, 1994.  As of March 21, 1997, 47,152,976 shares of common stock were 
issued and outstanding, and held by approximately 5,053 holders of record.  The 
Company paid a cash dividend of $0.20 per share in February, May, August and 
November 1996, as well as 1995. 

Information relating to the high, low and quarter-end closing sales prices of 
the Common Stock appears on page 43 in the Company's 1996 Annual Report to 
Shareholders and is incorporated herein by reference. 


ITEM 6.  SELECTED FINANCIAL DATA 

The above-captioned information appears under "Five Year Selected Consolidated 
Data" on pages 11 and 12 in the Company's 1996 Annual Report to Shareholders 
and is incorporated herein by reference.


ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND 
RESULTS OF OPERATIONS 

The above captioned information appears under "Management's Discussion and 
Analysis" on pages 13 through 21 in the Company's 1996 Annual Report to 
Shareholders and is incorporated herein by reference.


ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA 

The above captioned information appears on pages 22 through 43 in the Company's 
1996 Annual Report to Shareholders and is incorporated herein by reference.


ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND 
FINANCIAL DISCLOSURE 

Information contained in the Company's Current Report on Form 8-K, which was 
filed with the SEC on March 12, 1996, is incorporated herein by reference.



                                  PART III 

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT 

Information presented under the heading "Information with Respect to Nominees 
and Continuing Directors" on pages 3 through 5 in the Company's definitive 
Proxy Statement for its Annual Meeting of Shareholders to be held on May 2, 
1997, which was filed with the SEC on March 21, 1997, is incorporated herein by 
reference.


ITEM 11.  EXECUTIVE COMPENSATION 

Information relating to executive compensation included under the heading 
"Executive Compensation" on pages 10 through 12 (excluding the Stock 
Performance Graph on page 12) in the Company's Definitive Proxy Statement for 
its Annual meeting of Shareholders to be held on May 2, 1997, which was filed 
with the SEC on March 21, 1997, is incorporated herein by reference.


ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

Information relating to security ownership of certain beneficial owners and 
management included under the heading "Securities Owned by Directors and 
Executive Officers" on page 6 in the Company's Definitive Proxy Statement for 
its Annual Meeting of Shareholders to be held on May 2, 1997, which was filed 
with the SEC on March 21, 1997, is incorporated herein by reference.


ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS 

Information regarding certain relationships and related transactions is 
included under the heading "Transactions with Certain Related Persons" on page 
16 in the Company's Definitive Proxy Statement for its Annual Meeting of 
Shareholders to be held on May 2, 1997, which was filed with the SEC on March 
21, 1997, is incorporated herein by reference.



                                   PART IV 

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K 
                          GREENPOINT FINANCIAL CORP.
          LIST OF EXHIBITS (FILED HEREWITH UNLESS OTHERWISE NOTED) 


(a)  The following documents are filed as a part of this report:

  (1)  Consolidated Financial Statements of the Company are incorporated by 
reference to the following indicated pages of the 1996 Annual Report to 
Stockholders:

                                                                  Pages
                                                                  -----
Report of Independent Accountants                                   44

Consolidated Statements of Financial Condition as 
  of December 31, 1996 and 1995                                     22

Consolidated Statements of Income for the years ended 
  December 31, 1996, 1995 and 1994                                  23

Consolidated Statements of Cash Flows for the years 
  ended December 31, 1996, 1995 and 1994                            25

Consolidated Statements of Changes in Stockholders' Equity
  for the years ended December 31, 1996, 1995 and 1994              24

Notes to the Consolidated Financial Statements                      27




Exhibit
Number

 2.1   Purchase of Assets and Liability Assumption Agreement by and between 
       Home Savings of America, FSB, and GreenPoint Bank (1)
 3.1   Certificate of Incorporation of GreenPoint Financial Corp. (2)
 3.2   Bylaws of GreenPoint Financial Corp.
 3.3   Restated Organization Certificate of GreenPoint Bank  (3)
 3.4   Bylaws of GreenPoint Bank
10.1   Employment Agreement and Change of Control Agreement between GreenPoint 
       Financial Corp., GreenPoint Bank and Bharat B. Bhatt
10.2   Amended Employment Agreement between GreenPoint Financial Corp.,  
       GreenPoint Bank and Thomas S. Johnson (4)
10.3   Employment Agreements and Change of Control Agreements between 
       GreenPoint Financial Corp.,  GreenPoint Bank and Bernadette Arias, 
       Martin S. Dash and Charles P. Richardson (5)
10.4   GreenPoint Financial Corp. Amended and Restated 1994 Stock Incentive 
       Plan (6)
10.5   GreenPoint Financial Corp. 1994 Non-Employee Directors Stock Option 
       Plan (7)
10.6   GreenPoint Financial Corp. 1994 Annual Incentive Plan  (8)
10.7   GreenPoint Financial Corp. 1994 Long Term Incentive Plan (9)
10.8   GreenPoint Bank Recognition and Retention Plan for Employees (10)
10.9   GreenPoint Bank Retirement Plan for Independent Directors (11)
10.10  GreenPoint Bank 1993 Directors' Deferred Fee Stock Unit Plan (12)
10.11  GreenPoint Bank Employee Protection Plan for Officers (13)
10.12  GreenPoint Bank Employee Protection Plan for Staff Members (14)
11.1   Statement Regarding Computation of Per Share Earnings
13.1   Annual Report to Stockholders for Fiscal Year ended December 31, 1996
21.1   Subsidiaries of the Company
23.1   Consent of Independent Accountants
27.1   Financial Data Schedule

________________

(1)   Incorporated by reference to Exhibit 2.1 to the Company=s Quarterly 
      Report on Form 10-Q, dated June 30, 1995
(2)   Incorporated by reference to Exhibit 3.1 to the Company's Quarterly 
      Report on Form 10-Q, dated March 31, 1995
(3)   Incorporated by reference to Exhibit 3.3 to the 1994 10-K
(4)   Incorporated by reference to Exhibit  10.1 to the 1994 10-K
(5)   Incorporated by reference to Exhibit  10.2  to the 1994 10-K
(6)   Incorporated by reference to Exhibit  10.3  to the 1994 10-K
(7)   Incorporated by reference to Exhibit  10.4  to the 1994 10-K
(8)   Incorporated by reference to Exhibit  10.5  to the 1994 10-K
(9)   Incorporated by reference to Exhibit  10.6  to the 1994 10-K
(10)  Incorporated by reference to Exhibit  10.7  to the 1994 10-K
(11)  Incorporated by reference to Exhibit  10.8  to the 1994 10-K
(12)  Incorporated by reference to Exhibit  10.9  to the 1994 10-K
(13)  Incorporated by reference to Exhibit 10.10 to the 1994 10-K
(14)  Incorporated by reference to Exhibit 10.11 to the 1994 10-K


Financial Statements Schedules

The Schedules have been omitted as the required information is either not 
applicable or has been included in the Notes to the Consolidated Financial 
Statements in the Company's Annual Report to Shareholders.


Reports on Form 8-K

No current reports on Form 8-K were filed by the Company with the Securities 
and Exchange Commission during the quarter ended December 31, 1996.







SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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.

                                      GreenPoint Financial Corp.


                                      By:      /S/ Thomas S. Johnson
                                               Thomas S. Johnson
                                               Chairman of the Board,
                                               President and Chief
                                               Executive Officer

Dated: March 11, 1997

Pursuant to the requirements of the Securities Exchange Act of 1934, this 
report has been signed below by the following persons on behalf of the 
Registrant and in the capacities indicated and on the dates indicated.


Signature                     Title                         Date


/S/ Thomas S. Johnson         Chairman of the Board,        3/11/97
    Thomas S. Johnson         President and Chief
                              Executive Officer


/S/ Bernard S. Berman         Director                      3/11/97
    Bernard S. Berman


                              Director                      3/11/97
    Edward C. Bessey


/S/ Dan F. Huebner            Director                      3/11/97
    Dan F. Huebner


/S/ William M. Jackson        Director                      3/11/97
    William M. Jackson


/S/ Susan J. Kropf            Director                      3/11/97
    Susan J. Kropf


/S/ Robert M. McLane          Director                      3/11/97
    Robert M. McLane


/S/ Charles B. McQuade        Director                      3/11/97
    Charles B. McQuade


/S/ Alvin N. Puryear          Director                      3/11/97
    Alvin N. Puryear


/S/ Robert P. Quinn           Director                      3/11/97
    Robert P. Quinn


/S/ Edward C. Schmults        Director                      3/11/97
    Edward C. Schmults


/S/ Wilfred O. Uhl            Director                      3/11/97
    Wilfred O. Uhl


/S/ Robert F. Vizza           Director                      3/11/97
    Robert F. Vizza


/S/ Jules Zimmerman           Director                      3/11/97
    Jules Zimmerman



/S/ Charles P. Richardson     Executive Vice President      3/11/97
    Charles P. Richardson     and Chief Financial Officer


/S/ Mary Beth Farrell         Senior Vice President         3/11/97
    Mary Beth Farrell         and Comptroller

                          GREENPOINT FINANCIAL CORP.

                                    BYLAWS


                          GREENPOINT FINANCIAL CORP.



                                    BYLAWS


                           ARTICLE I - STOCKHOLDERS

      SECTION 1.   ANNUAL MEETING.

      An annual meeting of the stockholders, for the election of Directors to 
succeed those whose terms expire and for the transaction of such other business 
as may properly come before the meeting, shall be held at such place, on such 
date, and at such time as the Board of Directors shall each year fix, which 
date shall be within thirteen (13) months subsequent to the later of the date 
of incorporation or the last annual meeting of stockholders.


      SECTION 2.   SPECIAL MEETINGS.

      Subject to the rights of the holders of any class or series of preferred 
stock of the Corporation, special meetings of stockholders of the Corporation 
may be called only by the Board of Directors pursuant to a resolution adopted 
by a majority of the Whole Board.  The term "Whole Board" shall mean the total 
number of Directors which the Corporation would have if there were no vacancies 
on the Board of Directors (hereinafter the "Whole Board"). 


      SECTION 3.   NOTICE OF MEETINGS.

      Written notice of the place, date, and time of all meetings of the 
stockholders shall be given, not less than ten (10) nor more than sixty (60) 
days before the date on which the meeting is to be held, to each stockholder 
entitled to vote at such meeting, except as otherwise provided herein or 
required by law.

      When a meeting is adjourned to another place, date or time, written 
notice need not be given of the adjourned meeting if the place, date and time 
thereof are announced at the meeting at which the adjournment is taken; 
provided, however, that if the date of any adjourned meeting is more than 
thirty (30) days after the date for which the meeting was originally noticed, 
or if a new record date is fixed for the adjourned meeting, written notice of 
the place, date, and time of the adjourned meeting shall be given in conformity 
herewith.  At any adjourned meeting, any business may be transacted which might 
have been transacted at the original meeting.


      SECTION 4.   QUORUM.

      At any meeting of the stockholders, the holders of a majority of all of 
the shares of the stock entitled to vote at the meeting, present in person or 
by proxy (after giving effect to the provisions of Article FOURTH of the 
Corporation's Certificate of Incorporation), shall constitute a quorum for all 
purposes, unless or except to the extent that the presence of a larger number 
may be required by law.  Where a separate vote by a class or classes is 
required, a majority of the shares of such class or classes present in person 
or represented by proxy (after giving effect to the provisions of Article 
FOURTH of the Corporation's Certificate of Incorporation) shall constitute a 
quorum entitled to take action with respect to that vote on that matter.

      If a quorum shall fail to attend any meeting, the chairman of the meeting 
or the holders of a majority of the shares of stock entitled to vote who are 
present, in person or by proxy, may adjourn the meeting to another place, date, 
or time.


      SECTION 5.   ORGANIZATION.

      The Chairman of the Board of the Corporation or, in his or her absence, 
such person as the Board of Directors may have designated or, in the absence of 
such a person, such person as may be chosen by the holders of a majority of the 
shares entitled to vote who are present, in person or by proxy, shall call to 
order any meeting of the stockholders and act as chairman of the meeting.  In 
the absence of the Secretary of the Corporation, the secretary of the meeting 
shall be such person as the chairman appoints.


      SECTION 6.   CONDUCT OF BUSINESS.

      (a) The chairman of any meeting of stockholders shall determine the order 
of business and the procedures at the meeting, including such regulation of the 
manner of voting and the conduct of discussion as seem to him or her in order.  
The date and time of the opening and  closing of the polls for each matter upon 
which the stockholders will vote at the meeting shall be announced at the 
meeting.

      (b) At any annual meeting of the stockholders, only such business shall 
be conducted as shall have been brought before the meeting (i) by or at the 
direction of the Board of Directors or (ii) by any stockholder of the 
Corporation who is entitled to vote with respect thereto and who complies with 
the notice procedures set forth in this Section 6(b).  For business to be 
properly brought before an annual meeting by a stockholder, the business must 
relate to a proper subject matter for stockholder action and the stockholder 
must have given timely notice thereof in writing to the Secretary of the 
Corporation.  To be timely, a stockholder's notice must be delivered or mailed 
to and received at the principal executive office of the Corporation not less 
than ninety (90) days prior to the date of the annual meeting; provided, 
however, that in the event that less than one hundred (100) days' notice or 
prior public disclosure of the date of the meeting is given or made to 
stockholders, notice by the stockholder to be timely must be received not later 
than the close of business on the 10th day following the day on which such 
notice of the date of the annual meeting was mailed or such public disclosure 
was made.  A stockholder's notice to the Secretary shall set forth as to each 
matter such stockholder proposes to bring before the annual meeting (i) a brief 
description of the business desired to be brought before the annual meeting and 
the reasons for conducting such business at the annual meeting, (ii) the name 
and address, as they appear on the Corporation's books, of the stockholder 
proposing such business, (iii) the class and number of shares of the 
Corporation's capital stock that are beneficially owned by such stockholder and 
(iv) any material interest of such stockholder in such business.  
Notwithstanding anything in these Bylaws to the contrary, no business shall be 
brought before or conducted at an annual meeting except in accordance with the 
provisions of this Section 6(b).  The Chairman of the Board or other person 
presiding over the annual meeting shall, if the facts so warrant, determine and 
declare to the meeting that business was not properly brought before the 
meeting in accordance with the provisions of this Section 6(b) and, if he 
should so determine, he shall so declare to the meeting and any such business 
so determined to be not properly brought before the meeting shall not be 
transacted.

      At any special meeting of the stockholders, only such business shall be 
conducted as shall have been brought before the meeting by or at the direction 
of a majority of the Whole Board of Directors.

      (c)  Only persons who are nominated in accordance with the procedures set 
forth in these Bylaws shall be eligible for election as Directors.  Nominations 
of persons for election to the Board of Directors of the Corporation may be 
made at a meeting of stockholders at which directors are to be elected only (i) 
by or at the direction of the Board of Directors or (ii) by any stockholder of 
the corporation entitled to vote for the election of Directors at the meeting 
who complies with the notice procedures set forth in this Section 6(c).  Such 
nominations, other than those made by or at the direction of the Board of 
Directors, shall be made by timely notice in writing to the Secretary of the 
Corporation.  To be timely, a stockholder's notice shall be delivered or mailed 
to and received at the principal executive office of the Corporation not less 
than ninety (90) days prior to the date of the meeting; provided, however, that 
in the event that less than one hundred (100) days' notice or prior disclosure 
of the date of the meeting is given or made to stockholders, notice by the 
stockholder to be timely must be so received not later than the close of 
business on the 10th day following the day on which such notice of the date of 
the meeting was mailed or such public disclosure was made.  Such stockholder's 
notice shall set forth (i) as to each person whom such stockholder proposes to 
nominate for election or re-election as a Director, all information relating to 
such person that is required to be disclosed in solicitations of proxies for 
election of Directors, or is otherwise required, in each case pursuant to 
Regulation 14A under the Securities Exchange Act of 1934, as amended (including 
such person's written consent to being named in the proxy statement as a 
nominee and to serving as a Director if elected); and (ii) as to the 
stockholder giving the notice (x) the name and address, as they appear on the 
Corporation's books, of such stockholder and (y) the class and number of shares 
of the Corporation's capital stock that are beneficially owned by such 
stockholder.  At the request of the Board of Directors any person nominated by 
the Board of Directors for election as a Director shall furnish to the 
Secretary of the Corporation that information required to be set forth in a 
stockholder's notice of nomination which pertains to the nominee.  No person 
shall be eligible for election as a Director of the Corporation unless 
nominated in accordance with the provisions of this Section 6(c).  The Chairman 
of the Board or other person presiding at the meeting shall, if the facts so 
warrant, determine that a nomination was not made in accordance with such 
provisions and, if he or she shall so determine, he or she shall so declare to 
the meeting and the defective nomination shall be disregarded.


      SECTION 7.   PROXIES AND VOTING.

      At any meeting of the stockholders, every stockholder entitled to vote 
may vote in person or by proxy authorized by an instrument in writing filed in 
accordance with the procedure established for the meeting.  Any facsimile 
telecommunication or other reliable reproduction of the writing or transmission 
created pursuant to this paragraph may be substituted or used in lieu of the 
original writing or transmission for any and all purposes for which the 
original writing or transmission could be used, provided that such copy, 
facsimile telecommunication or other reproduction shall be a complete 
reproduction of the entire original writing or transmission.

      All voting, including the election of Directors but excepting where 
otherwise required by law or by the governing documents of the Corporation, may 
be made by a voice vote; provided, however, that upon demand therefore by a 
stockholder entitled to vote or his or  her proxy, a stock vote shall be taken. 
Every stock vote shall be taken by ballot, each of which shall state the name 
of the stockholder or proxy voting and such other information as may be 
required under the procedures established for the meeting.  The Board of 
Directors shall, in advance of any meeting of stockholders, appoint one or more 
inspectors to act at the meeting and make a written report thereof.  The Board 
of Directors may designate one or more persons as alternate inspectors to 
replace any inspector who fails to act.  If no inspector or alternate is able 
to act at a meeting of stockholders, the Chairman of the Board, or in his 
absence such person presiding at the meeting shall appoint one or more 
inspectors to act at the meeting.  Each inspector, before entering upon the 
discharge of his duties, shall take and sign an oath faithfully to execute the 
duties of inspector with strict impartiality and according to the best of his 
ability.

      All elections for Directors shall be determined by a plurality of the 
votes cast, and except as otherwise required by law, the Certificate of 
Incorporation or these Bylaws, all other matters shall be determined by a 
majority of the votes cast affirmatively or negatively.


      SECTION 8.   STOCK LIST.

      A complete list of stockholders entitled to vote at any meeting of 
stockholders, arranged in alphabetical order for each class of stock and 
showing the address of each such stockholder and the number of shares 
registered in his or her name, shall be open to the examination of any such 
stockholder, for any purpose germane to the meeting, during ordinary business 
hours for a period of at least ten (10) days prior to the meeting, either at a 
place within the city where the meeting is to be held, which place shall be 
specified in the notice of the meeting, or if not so specified, at the place 
where the meeting is to be held.

      The stock list shall also be kept at the place of the meeting during the 
whole time thereof and shall be open to the examination of any such stockholder 
who is present.  This list shall presumptively determine the identity of the 
stockholders entitled to vote at the meeting and the number of shares held by 
each of them.


      SECTION 9.   CONSENT OF STOCKHOLDERS IN LIEU OF MEETING.

      Subject to the rights of the holders of any class or series of preferred 
stock of the Corporation, any action required or permitted to be taken by the 
stockholders of the Corporation must be effected at an annual or special 
meeting of stockholders of the Corporation and may not be effected by any 
consent in writing by such stockholders.



                       ARTICLE II - BOARD OF DIRECTORS

      SECTION 1.   GENERAL POWERS, NUMBER AND TERM OF OFFICE.

      The business and affairs of the Corporation shall be under the direction 
of its Board of Directors.  The number of Directors who shall constitute the 
Whole Board shall be such number as the majority of the Whole Board shall from 
time to time have designated except in the absence of such designation such 
number shall be 16.  The Board of Directors shall annually elect a Chairman of 
the Board from among its members who shall when present, preside at meetings of 
the Board of Directors.

      The Directors, other than those who may be elected by the holders of any 
class or series of Preferred Stock, shall be divided, with respect to the time 
for which they severally hold office, into three classes, with the term of 
office of the first class to expire at the first annual meeting of 
stockholders, the term of office of the second class to expire at the annual 
meeting of stockholders one year thereafter and the term of office of the third 
class to expire at the annual meeting of stockholders two years thereafter, 
with each Director to hold office until his or her successor shall have been 
duly elected and qualified.  At each annual meeting of stockholders, Directors 
elected to succeed those Directors whose terms then expire shall be elected for 
a term of office to expire at the third succeeding annual meeting of 
stockholders after their election, with each Director to hold office until his 
or her successor shall have been duly elected and qualified.


      SECTION 2.   VACANCIES AND NEWLY CREATED DIRECTORSHIPS.

      Subject to the rights of the holders of any class or series of Preferred 
Stock, and unless the Board of Directors otherwise determines, newly created 
directorships resulting from any increase in the authorized number of directors 
or any vacancies in the Board of Directors resulting from death, resignation, 
retirement, disqualification, removal from office or other cause may be filled 
only by a majority vote of the Directors then in office, though less than a 
quorum, and Directors so chosen shall hold office for a term expiring at the 
annual meeting of stockholders at which the term of office of the class to 
which they have been elected expires and until such Director's successor shall 
have been duly elected and qualified.  No decrease in the number of authorized 
directors constituting the Board shall shorten the term of any incumbent 
Director.


      SECTION 3.   REGULAR MEETINGS.

      Regular meetings of the Board of Directors shall be held at such place or 
places, on such date or dates, and at such time or times as shall have been 
established by the Board of Directors and publicized among all Directors.  A 
notice of each regular meeting shall not be required.


      SECTION 4.   SPECIAL MEETINGS.

      Special meetings of the Board of Directors may be called by a majority of 
the Directors then in office (rounded up to the nearest whole number), or by 
the Chairman of the Board and shall be held at such place, on such date, and at 
such time as they, or he or she, shall fix.  Notice of the place, date, and 
time of each such special meeting shall be given each Director by whom is it 
not waived by mailing written notice not less than five (5) days before the 
meeting or by telegraphing or telexing or by facsimile transmission of the same 
not less than twenty-four (24) hours before the meeting.  Unless otherwise 
indicated in the notice thereof, any and all business may be transacted at a 
special meeting.


      SECTION 5.   QUORUM.

      At any meeting of the Board of Directors, a majority of the Whole Board 
shall constitute a quorum for all purposes.  If a quorum shall fail to attend 
any meeting, a majority of those present may adjourn the meeting to another 
place, date, or time, without further notice or waiver thereof.


      SECTION 6.   PARTICIPATION IN MEETINGS BY CONFERENCE TELEPHONE.

      Members of the Board of Directors, or of any committee thereof, may 
participate in a meeting of such Board or committee by means of conference 
telephone or similar communications equipment by means of which all persons 
participating in the meeting can hear each other and such participation shall 
constitute presence in person at such meeting.


      SECTION 7.   CONDUCT OF BUSINESS.

      At any meeting of the Board of Directors, business shall be transacted in 
such order and manner as the Board or the Chairman of the Board may from time 
to time determine, and all matters shall be determined by the vote of a 
majority of the Directors present, except as otherwise provided herein or 
required by law.  Action may be taken by the Board of Directors without a 
meeting if all members thereof consent thereto in writing, and the writing or 
writings are filed with the minutes of proceedings of the Board of Directors.


      SECTION 8.   POWERS.

      The Board of Directors may, except as otherwise required by law, exercise 
all such powers and do all such acts and things as may be exercised or done by 
the Corporation, including, without limiting the generality of the foregoing, 
the unqualified power:

      (1)  To declare dividends from time to time in accordance with law;

      (2)  To purchase or otherwise acquire any property, rights or privileges 
on such terms as it shall determine;

      (3)  To authorize the creation, making and issuance, in such form as it 
may determine, of written obligations of every kind, negotiable or 
non-negotiable, secured or unsecured, and to do all things necessary in 
connection therewith;

      (4)  To remove any Officer of the Corporation with or without cause, and 
from time to time to devolve the powers and duties of any Officer upon any 
other person for the time being;

      (5)  To confer upon any Officer of the Corporation the power to appoint, 
remove and suspend subordinate Officers, employees and agents;

      (6)  To adopt from time to time such stock option, stock purchase, bonus 
or other compensation plans for Directors, Officers, employees and agents of 
the Corporation and its subsidiaries as it may determine;

      (7)  To adopt from time to time such insurance, retirement, and other 
benefit plans for Directors, Officers, employees and agents of the Corporation 
and its subsidiaries as it may determine; and,

      (8)  To adopt from time to time regulations, not inconsistent with these 
Bylaws, for the management of the Corporation's business and affairs.


      SECTION 9.   COMPENSATION OF DIRECTORS.

      Directors, as such, may receive, pursuant to resolution of the Board of 
Directors, fixed fees and other compensation for their services as Directors, 
including, without limitation, their services as members of committees of the 
Board of Directors.


      SECTION 10.   RETIREMENT OF DIRECTORS.

      Except for the initial members of the Board of Directors, no person shall 
be eligible for initial election as a Director who is 65 years of age or more.  
No person may be elected, appointed, nominated or otherwise serve as a Director 
of the Corporation after December 31 of the year in which such person attains 
the age of 72, grandfathering the three Directors who currently (as at April 
1994) have attained the age of 72 or more to the age of 75.  Vacancies on the 
Board of Directors created by operation of this provision may be filled in 
accordance with these Bylaws.



                           ARTICLE III - COMMITTEES

      SECTION 1.   COMMITTEES OF THE BOARD OF DIRECTORS.

      The Board of Directors, by a vote of a majority of the Whole Board of 
Directors, may from time to time designate committees of the Board, with such 
lawfully delegable powers and duties as it thereby confers, to serve at the 
pleasure of a majority of the Whole Board and shall, for these committees and 
any others provided for herein, elect a Director or Directors to serve as the 
member or members, designating, if it desires, other Directors as alternate 
members who may replace any absent or disqualified member at any meeting of the 
committee.  The Board of Directors, by a resolution adopted by a majority of 
the Whole Board may terminate any committee previously established.  Any 
committee so designated by resolution adopted by a majority of the Whole Board 
may exercise the power and authority of the Board of Directors to declare a 
dividend, to authorize the issuance of stock or to adopt a certificate of 
ownership and merger pursuant to Section 253 of the Delaware General 
Corporation Law if the resolution which designates the committee or a 
supplemental resolution of the Board of Directors shall so provide.  In the 
absence or disqualification of any member of any committee and any alternate 
member in his or her place, the member or members of the committee present at 
the meeting and not disqualified from voting, whether or not he or she or they 
constitute a quorum, may by unanimous vote appoint another member of the Board 
of Directors to act at the meeting in the place of the absent or disqualified 
member.


      SECTION 2.   CONDUCT OF BUSINESS.

      Each committee may determine the procedural rules for meeting and 
conducting its business and shall act in accordance therewith, except as 
otherwise provided herein or required by law or the Board of Directors.  
Adequate provision shall be made for notice to members of all meetings; a 
majority of the members shall constitute a quorum unless the committee shall 
consist of one (1) or two (2) members, in which event one (1) member shall  
constitute a quorum; and all matters shall be determined by a majority vote of 
the members present.  Action may be taken by any committee without a meeting if 
all members thereof consent thereto in writing, and the writing or writings are 
filed with the minutes of the proceedings of such committee.


      SECTION 3.   NOMINATING COMMITTEE.

      The Board of Directors, by resolution adopted by a majority of the Whole 
Board, shall appoint a Nominating Committee of the Board, consisting of not 
less than three (3) members of the Board of Directors, one of whom shall be the 
Chairman of the Board.  The Nominating Committee shall have authority (a) to 
review any nominations for election to the Board of Directors made by a 
stockholder of the Corporation pursuant to Section 6(c)(ii) of Article I of 
these Bylaws in order to determine compliance with such Bylaw and (b) to 
recommend to the Whole Board nominees for election to the Board of Directors 
(i) to replace those Directors whose terms expire at the annual meeting of 
stockholders next ensuing and (ii) to fill vacancies resulting from death, 
resignation, retirement, disqualification, removal from office or other cause, 
or resulting from an increase in the authorized number of Directors.



                            ARTICLE IV - OFFICERS

      SECTION 1.   GENERALLY.

      (a)  The Board of Directors shall choose a Chairman of the Board, who 
shall be the Chief Executive Officer and President, and a Secretary and from 
time to time may choose such other officers as it may deem proper.  The 
Chairman of the Board shall be a member of the Board of Directors.  Any number 
of offices may be held by the same person.

      (b)  The term of office of all Officers shall be until the next annual 
election of Officers and until their respective successors are chosen but any 
Officer may be removed from office at any time by the affirmative vote of a 
majority of the authorized number of Directors then constituting the Board of 
Directors, or by the Chairman of the Board.

      (c)  All Officers chosen by the Board of Directors or the Chairman of the 
Board shall each have such powers and duties as generally pertain to their 
respective Offices, subject to the specific provisions of this ARTICLE IV.  
Such officers shall also have such powers and duties as from time to time may 
be conferred by the Board of Directors.


      SECTION 2.   CHAIRMAN OF THE BOARD OF DIRECTORS, CHIEF EXECUTIVE OFFICER 
                   AND PRESIDENT.

      The Chairman of the Board, Chief Executive Officer and President, subject 
to the provisions of these Bylaws and to the direction of the Board of 
Directors, shall serve in a general executive capacity and, when present, shall 
preside at all meetings of the stockholders of the Corporation.  He shall 
perform all duties and have all powers which are commonly incident to the 
office of Chairman of the Board or which are delegated to him by the Board of 
Directors.  He shall have power to sign all stock certificates, contracts and 
other instruments of the Corporation which are authorized.

      He shall also have general responsibility for the management and control 
of the business and affairs of the Corporation and shall perform all duties and 
have all powers which are commonly incident to the offices of President and 
Chief Executive Officer or which are delegated to them by the Board of 
Directors.  Subject to the direction of the Board of Directors, he shall have 
general supervision of all of the other Officers, employees and agents of the 
Corporation.


      SECTION 3.   VICE PRESIDENT.

      The Vice Presidents shall perform the duties and exercise the powers 
usually incident to their respective offices and/or such other duties and 
powers as may be properly assigned to them by the Board of Directors or the 
Chairman of the Board.  A Vice President  or Vice Presidents may be designated 
as Executive Vice President or Senior Vice President.


      SECTION 4.   SECRETARY.

      The Secretary or Assistant Secretary shall issue notices of meetings, 
shall keep their minutes, shall have charge of the seal and the corporate 
books, shall perform such other duties and exercise such other powers as are 
usually incident to such office and/or such other duties and powers as are 
properly assigned thereto by the Board of Directors or the Chairman of the 
Board.  Subject to the direction of the Board of Directors, the Secretary shall 
have the power to sign all stock certificates.


      SECTION 5.   ASSISTANT SECRETARIES AND OTHER OFFICERS.

      The Board of Directors or the Chairman of the Board may appoint one or 
more Assistant Secretaries and such other Officers who shall have such powers 
and shall perform such duties as are provided in these Bylaws or as may be 
assigned to them by the Board of Directors or the Chairman of the Board.


      SECTION 6.   ACTION WITH RESPECT TO SECURITIES OF OTHER CORPORATIONS.

      Unless otherwise directed by the Board of Directors, the Chairman of the 
Board or any Officer of the Corporation authorized by the Chairman of the Board 
shall have power to vote and otherwise act on behalf of the Corporation, in 
person or by proxy, at any meeting of stockholders of or with respect to any 
action of stockholders of any other corporation in which this Corporation may 
hold securities and otherwise to exercise any and all rights and powers which 
this Corporation may possess by reason of its ownership of securities in such 
other corporation.



                              ARTICLE V - STOCK

      SECTION 1.   CERTIFICATES OF STOCK.

      Each stockholder shall be entitled to a certificate signed by, or in the 
name of the Corporation by, the Chairman of the Board or the President, and by 
the Secretary or an Assistant Secretary, certifying the number of shares owned 
by him or her.  Any or all of the signatures on the certificate may be a 
facsimile.


      SECTION 2.   TRANSFERS OF STOCK.

      Transfers of stock shall be made only upon the transfer books of the 
Corporation kept at an office of the Corporation or by transfer agents 
designated to transfer shares of the stock of the Corporation.  Except where a 
certificate is issued in accordance with Section 4 Article V of these Bylaws, 
an outstanding certificate for the number of shares involved shall be 
surrendered for cancellation before a new certificate is issued therefor.


      SECTION 3.   RECORD DATE.

      In order that the Corporation may determine the stockholders entitled to 
notice of or to vote at any meeting of stockholders, or to receive payment of 
any dividend or other distribution or allotment of any rights or to exercise 
any rights in respect of any change, conversion or exchange of stock or for the 
purpose of any other lawful action, the Board of Directors may fix a record 
date, which record date shall not precede the date on which the resolution 
fixing the record date is adopted and which record date shall not be more than 
sixty (60) days nor less than ten (10) days before the date of any meeting of 
stockholders, nor more than sixty (60) days prior to the time for such other 
action as hereinbefore described; provided, however, that if no record date is 
fixed by the Board of Directors, the record date for determining stockholders 
entitled to notice of or to vote at a meeting of stockholders shall be at the 
close of business on the day next preceding the day on which notice is given 
or, if notice is waived, at the close of business on the next day preceding the 
day on which the meeting is held, and, for determining stockholders entitled to 
receive payment of any dividend or other distribution or allotment or rights or 
to exercise any rights of change, conversion or exchange of stock or for any 
other purpose, the record date shall be at the close of business on the day on 
which the Board of Directors adopts a resolution relating thereto.

      A determination of stockholders of record entitled to notice of or to 
vote at a meeting of stockholders shall apply to any adjournment of the 
meeting; provided, however, that the Board of Directors may fix a new record 
date for the adjourned meeting.


      SECTION 4.   LOST, STOLEN OR DESTROYED CERTIFICATES.

      In the event of the loss, theft or destruction of any certificate of 
stock, another may be issued in its place pursuant to such regulations as the 
Board of Directors may establish concerning proof of such loss, theft or 
destruction and concerning the giving of a satisfactory bond or bonds of 
indemnity.


      SECTION 5.   REGULATIONS.

      The issue, transfer, conversion and registration of certificates of stock 
shall be governed by such other regulations as the Board of Directors may 
establish.



                             ARTICLE VI - NOTICES

      SECTION 1.   NOTICES.

      Except as otherwise specifically provided herein or required by law, all 
notices required to be given to any stockholder, Director, Officer, employee or 
agent shall be in writing and may in every instance be effectively given by 
hand delivery to the recipient thereof, by depositing such notice in the mails, 
postage paid, or by sending such notice by prepaid telegram or mailgram or 
other courier.  Any such notice shall be addressed to such stockholder, 
Director, Officer, employee or agent at his or her last known address as the 
same appears on the books of the Corporation.  The time when such notice is 
received, if hand delivered, or dispatched, if delivered through the mails or 
by telegram or mailgram or other courier, shall be the time of the giving of 
the notice.


      SECTION 2.   WAIVERS.

      A written waiver of any notice, signed by a stockholder, Director, 
Officer, employee or agent, whether before or after the time of the event for 
which notice is to be given, shall be deemed equivalent to the notice required 
to be given to such stockholder, Director, Officer, employee or agent.  Neither 
the business nor the purpose of any meeting need be specified in such a waiver.



                         ARTICLE VII - MISCELLANEOUS

      SECTION 1.   FACSIMILE SIGNATURES.

      In addition to the provisions for use of facsimile signatures elsewhere 
specifically authorized in these Bylaws, facsimile signatures of any Officer or 
officers of the Corporation may be used whenever and as authorized by the Board 
of Directors or a committee thereof designated by the Board.


      SECTION 2.   CORPORATE SEAL.

      The Board of Directors may provide a suitable seal, containing the name 
of the Corporation, which seal shall be in the charge of the Secretary.  If and 
when so directed by the Board of Directors or a designated committee thereof, 
duplicates of the seal may be kept and used by the Chief Financial Officer or 
by an Assistant Secretary or an assistant to the Chief Financial Officer.


      SECTION 3.   RELIANCE UPON BOOKS, REPORTS AND RECORDS.

      Each Director, each member of any committee designated by the Board of 
Directors, and each Officer of the Corporation shall, in the performance of his 
or her duties, be fully protected in relying in good faith upon the books of 
account or other records of the Corporation and upon such information, 
opinions, reports or statements presented to the Corporation by any of its 
Officers or employees, or committees of the Board of Directors so designated, 
or by lawyers, accountants, agents or any other person as to matters which such 
Director or committee member or officer reasonably believes are within such 
other person's professional or expert competence and who has been selected with 
reasonable care by or on behalf of the Corporation.


      SECTION 4.   FISCAL YEAR.

      The fiscal year of the Corporation shall be as fixed by the Board of 
Directors.


      SECTION 5.   TIME PERIODS.

      In applying any provision of these Bylaws which requires that an act be 
done or not be done a specified number of days prior to an event or that an act 
be done during a period of a specified number of days prior to an event, 
calendar days shall be used, the day of the doing of the act shall be excluded, 
and the day of the event shall be included.



                          ARTICLE VIII - AMENDMENTS

      The Board of Directors by a resolution adopted by a majority of the Whole 
Board, may amend, alter or repeal these Bylaws at any meeting of the Board, 
provided notice of the proposed change was given not less than two days prior 
to the meeting.  The stockholders shall also have power to amend, alter or 
repeal these Bylaws at any meeting of stockholders provided notice of the 
proposed change was given in the notice of the meeting; provided, however, 
that, notwithstanding any other provisions of the Bylaws or any provision of 
law which might otherwise permit a lesser vote or no vote, but in addition to 
any affirmative vote of the holders of any particular class or series of the 
voting stock required by law, the Certificate of Incorporation, any Preferred 
Stock Designation or these Bylaws, the affirmative votes of the holders of at 
least 80% of the voting power (taking into account the  provisions of Article 
FOURTH of the Certificate of Incorporation) of all the then-outstanding shares 
of the Voting Stock voting together as a single class, shall be required to 
alter, amend or repeal any provisions of these Bylaws.

The above Bylaws are effective as of August 31, 1993, the date of incorporation 
of GP FINANCIAL CORP.


                                    BYLAWS
                                      OF
                               GREENPOINT BANK



                          BYLAWS OF GREENPOINT BANK



                           ARTICLE I.  HOME OFFICE

      The home office of the GreenPoint  Bank ("SAVINGS BANK") is 807 Manhattan 
Avenue, Brooklyn, New York.



                          ARTICLE II.  SHAREHOLDERS

      SECTION 1.  PLACE OF MEETINGS.  All annual and special meetings of 
shareholders shall be held at the home office of the SAVINGS BANK or at such 
other place in the State in which the principal place of business of the 
SAVINGS BANK is located as the Board of Directors may determine.

      SECTION 2.  ANNUAL MEETING.  A meeting of the shareholders of the SAVINGS 
BANK for the election of Directors and for the transaction of any other 
business of the SAVINGS BANK shall be held annually within 120 days after the 
end of each calendar year.

      SECTION 3.  SPECIAL MEETINGS.  Special meetings of the shareholders for 
any purpose or purposes, unless otherwise prescribed by the regulations of the 
New York State Banking Department ("NYB"), may be called at any time by the 
Chairman of the Board of Directors (as set forth in Article V, Section 7, 
hereinafter referred to as the "Chairman of the Board") or by a majority of the 
Whole Board of Directors, whereas the term "Whole Board of Directors" shall 
mean the number of authorized directorships, whether or not there exists any 
vacancies in any previously authorized directorships.

      SECTION 4.  CONDUCT OF MEETINGS.  The Chairman of the Board shall preside 
at all meetings and in his absence, a person designated by a majority of the 
Board shall preside at all meetings.  The chairman of any meeting of 
stockholders shall determine the order of business and the procedures at the 
meeting, including such regulations of the manner of voting and the conduct of 
discussion as seem to him in order.

      SECTION 5.  NOTICE OF MEETINGS.  Written notice stating the place, day 
and hour of the meeting and the purpose(s) for which the meeting is called 
shall be delivered not fewer than 10 nor  more than 50 days before the date of 
the meeting, either personally or by mail, by or at the direction of the 
Chairman of the Board, the secretary, or the Board of Directors calling the 
meeting, to each shareholder of  record entitled to vote at such meeting.  If 
mailed, such notice shall be deemed to be delivered when deposited in the mail, 
addressed to the shareholder at the address as it appears on the stock transfer 
books or records of the SAVINGS BANK as of the record date prescribed in 
Section 6 of this Article II, with postage prepaid.  When any shareholders' 
meeting, either annual or special, is adjourned for 30 days or more, notice of 
the adjourned meeting shall be given as in the case of an original meeting.  It 
shall not be necessary to give any notice of the time and place of any meeting 
adjourned for less than 30 days or of the business to be transacted at the 
meeting, other than an announcement at the meeting at which such adjournment 
is taken.

      SECTION 6.  FIXING OF RECORD DATE.  For the purpose of determining 
shareholders entitled to notice of or to vote at any meeting of shareholders or 
any adjournment, or shareholders entitled to receive payment of any dividend, 
or in order to make a determination of shareholders for any other proper 
purpose, the Board of Directors shall fix in advance a date as the record date 
for any such determination of shareholders.  Such date in any case shall be not 
more than 50 days and, in case of a meeting of shareholders, not fewer than 10 
days prior to the date on which the particular action, requiring such 
determination of shareholders, is to be taken.  When a determination of 
shareholders entitled to vote at any meeting of shareholders has been made as 
provided in this section, such determination shall apply to any adjournment. 

      SECTION 7.  VOTING LISTS.  At least 20 days before each meeting of the 
shareholders, the officer or agent having charge of the stock transfer books 
for shares of the SAVINGS BANK shall make a complete list of the shareholders 
entitled to vote at such meeting, or any adjournment, arranged in alphabetical 
order, with the address and the number of shares held by each.  This list of 
shareholders shall be kept on file at the home office of the SAVINGS BANK.  
Such list shall also be produced and kept open at the time and place of the 
meeting and shall be subject to the inspection by any shareholder during the 
entire time of the meeting.  The original stock transfer book shall constitute 
prima facie evidence of the shareholders entitled to examine such list or 
transfer books or to vote at any meeting of shareholders.

      SECTION 8.  QUORUM.  A majority of the outstanding shares of the SAVINGS 
BANK entitled to vote, represented in person or by proxy, shall constitute a 
quorum at a meeting of shareholders.  The shareholders present at a duly 
organized meeting may continue to transact business until adjournment, 
notwithstanding the withdrawal of enough shareholders to constitute less than a 
quorum.  If less than a majority of the outstanding shares is represented at a 
meeting, a majority of the shares so represented may adjourn the meeting from 
time to time without further notice.  At such adjourned meeting at which a 
quorum shall be present or represented, any business may be transacted which 
might have been transacted at the meeting as originally notified.  The 
existence of a quorum at any meeting, or the existence of a duly organized 
meeting at which enough shareholders have withdrawn from such meeting to 
constitute less than a quorum, however, shall not serve to amend, alter or 
modify any provisions in the SAVINGS BANK'S restated organization certificate 
or these Bylaws which require the vote of more than a majority of the 
outstanding shares entitled to vote at a duly organized meeting.

      SECTION 9.  PROXIES.  At all meetings of shareholders, a shareholder may 
vote by proxy executed in writing by the shareholder or by his duly authorized 
attorney in fact.  Proxies solicited on behalf of the management shall be voted 
as directed by the shareholder or, in the absence of such direction, as 
determined by a majority of the Whole Board of Directors.  No proxy shall be 
valid more than eleven months from the date of its execution except for a proxy 
coupled with an interest.

      SECTION 10.  VOTING OF SHARES IN THE NAME OF TWO OR MORE PERSONS.  When 
ownership stands in the name of two or more persons, in the absence of written 
directions to the SAVINGS BANK to the contrary, at any meeting of the 
shareholders of the SAVINGS BANK any one or more of such shareholders may cast, 
in person or by proxy, all votes to which such ownership is entitled.  In the 
event an attempt is made to cast conflicting votes, in person or by proxy, by 
the several persons in whose names shares of stock stand, the vote or votes to 
which those persons are entitled shall be cast as directed by a majority of 
those holding such and present in person or by proxy at such meeting, but no 
votes shall be cast for such stock if a majority cannot agree.

      SECTION 11.  VOTING OF SHARES BY CERTAIN HOLDERS.  Shares standing in the 
name of another corporation may be voted by any officer, agent or proxy as the 
bylaws of such corporation may prescribe, or, in the absence of such provision, 
as the board of directors of such corporation may determine.  Shares held by an 
administrator, executor, guardian or conservator may be voted by him, either in 
person or by proxy, without a transfer of such shares into his name.   Shares 
standing in the name of a trustee may be voted by him, either in person or by 
proxy, but no trustee shall be entitled to vote shares held by him without a 
transfer of such shares into his name.  Shares standing in the name of a 
receiver may be voted by such receiver, and shares held by or under the control 
of a receiver may be voted by such  receiver without the transfer into his 
name, if authority to do so is contained in an appropriate order of the court 
or other public authority by which such receiver was appointed.

      A shareholder whose shares are pledged shall be entitled to vote such 
shares until the shares have been transferred into the name of the pledgee and 
thereafter the pledgee, shall be entitled to vote the shares so transferred.

      Neither treasury shares of its own stock held by the SAVINGS BANK, nor 
shares held by another corporation, if a majority of the shares entitled to 
vote for the election of directors of such other corporation are held by the 
SAVINGS BANK, shall be voted at any meeting or counted in determining the total 
number of outstanding shares at any given time for purposes of any meeting.

      SECTION 12.  CUMULATIVE VOTING.  Shareholders shall not be entitled to 
cumulate their votes for election of directors.

      SECTION 13.  INSPECTORS OF ELECTION.  In advance of any meeting of 
shareholders, the Board of Directors may appoint any persons other than 
nominees for office as inspectors of election to act at such meeting or any 
adjournment.  The number of inspectors shall be either one or three.  Any such 
appointment shall not be altered at the meeting.  If inspectors of election are 
not so appointed, the Chairman of the Board may, or on the request of a 
shareholder present at the meeting shall, make such appointment at the meeting. 
If appointed at the meeting, the Chairman of the Board shall determine whether 
there shall be one or three inspectors of election.  If appointed at the 
meeting and the Chairman of the Board fails to determine whether there shall be 
one or three inspectors of election, the majority of the votes present shall 
determine whether one or three inspectors are to be appointed.  In case any 
person appointed as inspector fails to appear or fails or refuses to act, the 
vacancy may be filled by appointment by the Board of Directors in advance of 
the meeting, or at the meeting by the Chairman of the Board.

      Unless otherwise prescribed by regulations of the NYB, the duties of such 
inspectors shall include: determining the number of shares outstanding and the 
voting power of each share, the number of shares represented at the meeting, 
the existence of a quorum, and the authenticity, validity and effect of 
proxies; receiving votes, ballots, or consents; hearing and determining all 
challenges and questions in any way arising in connection with the rights to 
vote; counting and tabulating all votes or consents; determining the result; 
and such acts as may be proper to conduct the election or vote with fairness to 
all shareholders.

      SECTION 14.  NEW BUSINESS.  Any new business to be taken up at the annual 
meeting shall be stated in writing and filed with the secretary of the SAVINGS 
BANK at least 45 days before the date of the annual meeting, and all business 
so stated, proposed, and filed shall be considered at the annual meeting, but 
no other proposal shall be acted upon at the annual meeting.  Any shareholder 
may make any other proposal at the annual meeting and the same may be discussed 
and considered, but unless stated in writing and filed with the secretary at 
least 45 days before the meeting, such proposal shall be laid over for action 
at an adjourned, special, or annual meeting of the shareholders taking place 30 
days or more thereafter.  This provision shall not prevent the consideration 
and approval or disapproval at the annual meeting of reports of officers, 
directors and committees; but in connection with such reports no new business 
shall be acted upon at such annual meeting unless stated and filed as herein 
provided. 

      SECTION 15.  INFORMAL ACTION BY SHAREHOLDERS.  Any action required to be 
taken at a meeting of shareholders, or any other action which may be taken at a 
meeting of the shareholders, may be taken without a meeting if consent in 
writing, setting forth the action so taken, shall be given by all of the 
shareholders entitled to vote with respect to the subject matter.



                       ARTICLE III.  BOARD OF DIRECTORS

      SECTION 1.  GENERAL POWERS.  The business and affairs of the SAVINGS BANK 
shall be under the direction of its Board of Directors.  No more than three 
salaried officers of the SAVINGS BANK may simultaneously serve on the board.  
The Board of Directors shall annually elect a Chairman from among its members 
who shall preside at its regular and special meetings.  In the absence or 
inability of the foregoing officer to act, at any fully constituted meeting of 
the Board members, a temporary chairperson shall be appointed by those present 
to act as such during the interim term.

      SECTION 2.  NUMBER AND TERM.  The Board of Directors shall consist of 
fourteen (14) members and shall be divided into three classes as nearly equal 
in number as possible.  The members of each class shall be elected for a term 
of three years and until their successors are elected and qualified.  One class 
shall be elected annually.

      SECTION 3.  REGULAR MEETINGS.  A regular monthly meeting of the Board of 
Directors shall be held at least eleven times a year without other notice than 
this bylaw.  At least one meeting shall be held immediately after and at the 
same place as, the annual meeting of shareholders, which shall be the annual 
meeting of the Board.  The Board of Directors may provide, by resolution, the 
time and place, within the SAVINGS BANK's normal lending territory, for the 
holding of additional regular meetings without other notice than such 
resolution.

      SECTION 4.  QUALIFICATION.  Each director shall at all times be the 
beneficial owner of not less than 100 shares of capital stock of the SAVINGS 
BANK unless the SAVINGS BANK is a wholly owned subsidiary of a holding company.

      SECTION 5.  SPECIAL MEETINGS.  The Chairman of the Board, or in the 
absence or disability of the Chairman of the Board, an Executive Vice President 
may call special meetings of the Board, and the Secretary of the Board shall 
call a meeting upon the written request of a majority of the Board of 
Directors.  A special meeting may be held at such time and place as shall be 
stated in the notice of meeting. 

      SECTION 6.  PARTICIPATION IN MEETINGS BY DIRECTORS.  Members of the Board 
of Directors, or any committee thereof, may participate in a meeting of such 
Board or Committee by means of conference telephone, or by means of similar 
communications equipment by means of which all persons participating in the 
meeting can speak and hear each other at the same time and such participation 
shall constitute presence in person at such meeting.

      SECTION 7.  NOTICE.  Written notice of any special meeting shall be given 
to each director at least twenty-four (24) hours prior thereto when delivered 
personally or by telephone or telegram, or at least five days prior thereto 
when delivered by mail at the address at which the director is most likely to 
be reached.  Such notice shall be deemed to be delivered when deposited in the 
mail so addressed, with postage prepaid if mailed, or when delivered to the 
telegraph company if sent by telegram.  Any director may waive notice of any 
meeting by a writing filed with the secretary.  The attendance of a director at 
a meeting shall constitute a waiver of notice of such meeting, except where a 
director attends a meeting for the express purpose of objecting to the 
transaction of any business because the meeting is not lawfully called or 
convened.  The business to be transacted at, and the purpose of, any special 
meeting of the Board of Directors must be specified in the notice of such 
meeting and no other business shall be transacted at that time.

      SECTION 8.  QUORUM.  A majority of the number of directors fixed by 
Section 2 of this Article III shall constitute a quorum for the transacting of 
business at any meeting of the Board of Directors, but if less than such 
majority is present at a meeting, a majority of the directors present may 
adjourn the meeting from time to time.  Notice of any adjourned meeting shall 
be given in the same manner as prescribed by Section 7 of this Article III.

      SECTION 9.  MANNER OF ACTING.  The act of the majority of the directors 
present at a meeting at which a quorum is present shall be the act of the Board 
of Directors, unless a greater number is prescribed by regulations of the NYB, 
the Restated Organization Certificate or by these Bylaws.

      SECTION 10.  ACTION WITHOUT A MEETING.  Any action required or permitted 
to be taken by the Board of Directors at a meeting may be taken without a 
meeting if a consent in writing, setting forth the action so taken, shall be 
signed by all of the directors.

      SECTION 11.  ELIGIBILITY, RESIGNATION AND RETIREMENT.  Any director may 
resign at any time by sending a written notice of such resignation to the home 
office of the SAVINGS BANK addressed to the Chairman of the Board.  Unless 
otherwise specified, such resignation shall take effect upon receipt by the 
Chairman of the Board.  The absence from regular meetings of the Board of 
Directors and the meetings of any committee of the Board of which the director 
is a member, for six consecutive months, unless excused by resolution of the 
Board of Directors, shall automatically constitute a resignation, effective 
when such resignation is accepted by the Board of Directors.

      Except for the initial members of the Board of Directors as set forth in 
the Restated Organization Certificate, no person shall be eligible for initial 
election as a Director who is 65 years of age or more.  No person may be 
elected, appointed, nominated or otherwise serve as a director of the SAVINGS 
BANK after December 31 of the year in which such person attains the age of 72, 
grandfathering the three Directors who currently (as at April 1994) have 
attained the age of 72 or more to the age of 75.  Vacancies on the Board of 
Directors created by operation of this provision may be filled in accordance 
with the Bylaws.

      SECTION 12.  VACANCIES.  All vacancies in the office of Director, 
including newly created Directorships resulting from an increase in the number 
of Directors, shall be filled by election of stockholders, except that 
vacancies not exceeding one-third of the entire Board of Directors may be 
filled by the affirmative vote of a majority of the remaining directors, 
although less than a quorum of the Board of Directors, provided that the 
nomination of a candidate therefor shall have been made by the Nominating 
Committee, created as hereinafter provided in these Bylaws.  A director elected 
to fill a vacancy shall be elected to serve for the balance of the unexpired 
term and a Director elected to fill a vacancy to be filled by reason of an 
increase in the number of directors shall be elected to serve for the balance 
of the unexpired term of the class to which such director is elected.

      SECTION 13.  COMPENSATION.  Directors, as such, may receive compensation 
for their services, including a stated retainer.  By resolution of the Board of 
Directors, a reasonable fixed sum, and reasonable expenses of attendance, if 
any, may be allowed for actual attendance at each regular or special meeting of 
the Board of Directors.  Members of either standing, special or temporary 
committees, as such, may receive compensation for their services, including a 
stated retainer, as the Board of Directors may determine.  By resolution of the 
Board of Directors, a reasonable fixed sum, and reasonable expenses of 
attendance, if any, may be allowed for actual attendance at each regular or 
special meeting of committees.

      SECTION 14.  PRESUMPTION OF ASSENT.  A director of the SAVINGS BANK who 
is present at a meeting of the Board of Directors at which action on any 
SAVINGS BANK matter is taken shall be presumed to have assented to the action 
taken unless his dissent or abstention shall be entered in the minutes of the 
meeting or unless he shall file a written dissent to such action with the 
person acting as the secretary of the meeting before the adjournment thereof or 
shall forward such dissent by registered mail to the secretary of the SAVINGS 
BANK within five days after the date a copy of the minutes of the meeting is 
received.  Such right to dissent shall not apply to a director who voted in 
favor of such action.

      SECTION 15.  REMOVAL OF DIRECTORS.  At a meeting of shareholders called 
expressly for that purpose, any director may be removed for cause by a vote of 
the holders of a majority of the shares then entitled to vote at an election of 
directors.  Whenever the holders of the shares of any class are entitled to 
elect one or more directors by the provisions of the Restated Organization 
Certificate or supplemental sections thereto, the provisions of this section 
shall apply, in respect to the removal of a director or directors so elected, 
to the vote of the holders of the outstanding shares of that class and not to 
the vote of the outstanding shares as a whole. 

      SECTION 16.  EMERGENCY AUTHORITY.  In the event there shall occur an 
acute emergency resulting from a hostile attack, as defined in Article 7 of the 
New York State Defense Emergency Act, which shall be of such severity as to 
prevent the conduct and management of the affairs and business of the SAVINGS 
BANK by its Directors and officers as otherwise provided in these Bylaws, any 
three or more available members of the then incumbent Executive Committee shall 
constitute an emergency Board of Directors which shall have the power, subject 
to limitations prescribed in Article 7 of the New York State Defense Emergency 
Act, by a majority of such persons present, to take any and every action which 
may be necessary to meet the exigencies of the acute emergency and to enable 
the SAVINGS BANK to conduct its business during such period, including the 
relocation elsewhere of any office of the SAVINGS BANK which shall be unable to 
function because of the acute emergency.  If during the period of acute 
emergency there shall be no Executive Committee, or a minimum of three members 
of the then incumbent Executive Committee shall not be available, then and in 
that event such other available Directors as may be needed to obtain the 
minimum of three members shall serve on the emergency Board of Directors.

      During a period of acute emergency resulting from a hostile attack, the 
emergency management of the SAVINGS BANK shall be in accordance with the powers 
and limitations contained in the existing provisions of Article 7 of the New 
York State Defense Emergency Act, and such provisions shall suspend or modify 
these Bylaws to the extent of any conflict.



                           ARTICLE IV.  COMMITTEES

      SECTION 1.  ENUMERATION OF COMMITTEES.  The standing committees of the 
Board of Directors shall be an Executive Committee, an Audit Committee, and a 
Nominating Committee.  The Board of Directors, by vote of a majority of the 
whole Board of Directors, may from time to time designate additional committees 
of the Board, either temporary or permanent, with such lawfully delegable 
powers and duties as it thereby confers not inconsistent with these Bylaws, to 
serve at the pleasure of a majority of the Whole Board and shall, for these 
committees and any others provided for herein, elect a Director or Directors to 
serve as the member or members, designating, if it desires, other Directors as 
alternate members ("Alternate Directors") who may replace any absent or 
disqualified member at any meeting of the committee; provided however, that the 
Chairman shall be a member of, and shall serve as the chairman of the Executive 
Committee and he shall be an ex-officio member of all other committees, except 
the Audit Committee and any other committee on which he is prohibited from 
being a member, by law, the Restated Organization Certificate or these Bylaws.  
The Board of Directors, by a resolution adopted by a majority of the Whole 
Board may terminate any committee previously established.

      SECTION 2.  THE EXECUTIVE COMMITTEE.  The Executive Committee shall 
consist of the Chairman of the Board and four additional Directors elected 
annually by the vote of the majority of the Whole Board.


      If any member of the Executive Committee shall be absent from any meeting 
of the committee, the Chairman shall designate some other Director, other than 
one serving as a salaried officer, to act as a member of the committee at that 
meeting.  In the event there shall be a vacancy in the office of Chairman, then 
and in that event such other additional Director or Directors as may be needed 
to obtain the full complement of five members shall be elected by the Board to 
serve until the vacancy is filled, or until the next annual meeting.  Any 
member of the executive committee may be removed at any time with or without 
cause by resolution adopted by a majority of the Whole Board of Directors.

      Regular meetings of the Executive Committee may be held without notice at 
such times and places as the Executive Committee may fix from time to time by 
resolution.  Special meetings of the committee may be called by the Chairman or 
at any time by any two members of the committee, upon twenty-four hours' notice 
by mail, in person, or by telegraph or telephone.  The notice of a special 
meeting of the committee, however given, shall state the time when and the 
place, which shall be within the State of New York, where the meeting is to be 
held and the business which is to be presented and no business other than that 
stated in the notice shall be transacted at said meeting.  The Executive 
Committee may make rules for the regulation of its meetings and proceedings not 
inconsistent with these Bylaws.

      Four members of the committee, including designees designated to act for 
an absent member or members of the committee, shall be necessary for a quorum 
at any meeting of the committee.  Attendance by Alternate Directors shall 
constitute membership on the Committee for determining quorum requirements.  
Action of the executive committee must be authorized by the affirmative vote of 
a majority of the members present at a meeting at which a quorum is present.  
Any action required or permitted to be taken by the executive committee at a 
meeting may be taken without a meeting if a consent in writing, setting forth 
the action so taken, shall be signed by all of the members of the executive 
committee.

      Except as otherwise provided herein, the Executive Committee, when the 
Board of Directors is not in session, shall have and may exercise all of the 
authority of the Board of Directors, except to the extent, if any, that such 
authority may be limited by resolution adopted by a majority of the Whole Board 
of Directors or by the laws of the State of New York.  In addition, the 
Executive Committee shall not have the authority of the Board of Directors with 
reference to: the submission to stockholders of any action that requires 
stockholders' authorization under New York law or regulations; the filling of 
vacancies in the Board of Directors or in any committee of the Board of 
Directors; the fixing of compensation of the Directors for serving on the Board 
or any committee thereof; the amendment or repeal of any resolution of the 
Board of Directors which by its terms shall not be so amendable or repealable; 
the taking of any action which is expressly required by New York law or 
regulation to be taken at a meeting of the Board of Directors or by a specified 
proportion of Directors; the amendment or repeal of the Restated Organization 
Certificate or Bylaws of the SAVINGS BANK or adoption of new Bylaws of the 
SAVINGS BANK, or recommending to the shareholders a plan of merger, 
consolidation, or conversion; the sale, lease or other disposition of all or 
substantially all of the property and assets of the SAVINGS BANK otherwise than 
in the usual and regular course of its business; a voluntary dissolution of the 
SAVINGS BANK; a revocation of any of the foregoing; or the approval of a 
transaction in which any member of the executive committee, directly or 
indirectly, has any material beneficial interest.

      SECTION 3.  THE NOMINATING COMMITTEE.  The Board of Directors, by 
resolution adopted by a majority of the Whole Board, shall appoint a Nominating 
Committee of the Board, consisting of not less than three (3) members of the 
Board of Directors, one of whom shall be the Chairman of the Board.  The 
Nominating Committee shall have authority (a) to review any nominations for 
election to the Board of Directors made by a stockholder of the SAVINGS BANK 
and (b) to recommend to the Whole Board nominees for election to the Board of 
Directors (i) to replace those Directors whose terms expire at the annual 
meeting of stockholders next ensuing and (ii) to fill vacancies resulting from 
death, resignation, retirement, disqualification, removal from office or other 
cause, or resulting from an increase in the authorized number of Directors.

      SECTION 4.  THE AUDIT COMMITTEE.  The Audit Committee shall consist of 
four or more Directors, none of whom shall be a salaried officer of the SAVINGS 
BANK, who shall be elected to said Committee at the annual meeting of the Board 
of Directors, or in the case of the filling of a vacancy (such vacancy, in 
every case to be filled by an existing non-salaried Director) at any regular or 
special meeting of the Board.  The Audit Committee shall assist the Board of 
Directors in fulfilling its obligation to oversee the appropriateness of 
accounting policies, and SAVINGS BANK procedures and controls and shall be 
charged with the duty of carrying out the requirements of Section 254 of the 
Banking Law as the same now is in force or as it may be  amended or of any law 
substituted therefor.  In performing its functions, the Audit Committee shall 
utilize the expertise of the SAVINGS BANK's internal Auditing Department under 
the direction of the SAVINGS BANK's internal Auditor.  The Audit Committee 
shall hold formal meetings with the SAVINGS BANK's internal auditors on a 
quarterly basis.



                             ARTICLE V.  OFFICERS

      SECTION 1. POSITIONS.  The Board shall elect a Chairman of the Board, who 
shall be the Chief Executive Officer and President, and who shall be a member 
of the Board of Directors.   The Board shall also elect one or more Executive 
Vice Presidents, one or more Senior Vice Presidents, and a Secretary, who need 
not be members of the Board.  The offices of Secretary and, if appointed, 
Treasurer, may be held by the same person and a Vice President may also be 
either a Secretary or Treasurer.  Any offices may be held concurrently by the 
same person, except that the Chairman shall hold no additional office other 
than in this Section 1 provided.  The Board of Directors shall also appoint the 
Auditor, who may not hold another office.

      The Chairman and the Executive Vice Presidents shall be the Executive 
Officers of the SAVINGS BANK.

      SECTION 2.  ELECTION AND TERM OF OFFICE.  The officers of the SAVINGS 
BANK required to be elected by the Board of Directors pursuant to Section 1 
hereof shall be elected annually at the annual meeting of the Board of 
Directors or at the first meeting of the Board of Directors held after each 
annual meeting of the shareholders.  If the election of officers is not held at 
such meeting, such election shall be held as soon thereafter as possible.  Each 
officer shall hold office until a successor has been duly elected and qualified 
or until the officer's death, resignation, retirement or removal in the manner 
hereinafter provided.  Election or appointment of an officer, employee or agent 
shall not of itself create contractual rights.  The Board of Directors may 
authorize the SAVINGS BANK to enter into an employment contract with any 
officer; but no such contract shall impair the right of the Board of Directors 
to remove any officer at any time in accordance with Section 3 of this Article 
V.

      SECTION 3.  REMOVAL.  Any officer may be removed by the Board of 
Directors whenever in its judgment the best interests of the SAVINGS BANK will 
be served thereby, but such removal, other than for cause, shall be without 
prejudice to the contractual rights, if any, of the person so removed.

      SECTION 4.  VACANCIES.  A vacancy in any executive officer position 
because of death, resignation, removal, disqualification or otherwise, may be 
filled by the Board of Directors for the unexpired portion of the term.  Any 
vacancy in any officer position other than an executive officer position may be 
filled by the Chief Executive Officer for the unexpired portion of the term, 
provided such action by the Chief Executive Officer is ratified by the Board of 
Directors.

      SECTION 5.  DELEGATION OF DUTIES.  In the absence or disability of an 
officer of the SAVINGS BANK, or for any other reason which may seem sufficient 
to the Board, the Board of Directors may delegate his powers and duties to any 
other officer or to any Director.

      SECTION 6. REMUNERATION.  The remuneration of the officers shall be fixed 
from time to time by the Board of Directors.  The employees of the SAVINGS BANK 
shall receive such compensation and allowances as the Board of Directors may 
from time to time fix or approve or, within limits or schedules from time to 
time fixed or established by the Board as may be determined by the Executive 
Committee, the Chairman or a committee of the Board appointed for that purpose.

      SECTION 7.  CHAIRMAN OF THE BOARD OF DIRECTORS, CHIEF EXECUTIVE OFFICER 
AND PRESIDENT.  The Chairman of the Board shall be the Chief Executive Officer 
and President of the SAVINGS BANK and, subject to the provisions of these 
Bylaws and the resolutions of the Board, shall have the active management, 
direction and supervision of the SAVINGS BANK and its officers, its operations, 
securities and obligations, and shall have all powers and perform all duties 
incidental of his office.  He shall preside at all meetings of the Board and 
the Executive Committee, appoint all committees not otherwise provided for by 
law or by these Bylaws or by action of the Board of Directors, and shall be an 
ex-officio member of all other committees, except the Audit Committee and 
committees on which he is ineligible to serve by law, the Restated Organization 
Certificate or these Bylaws.  He may perform, or cause to be performed, at any 
time, any of the functions or duties of any other officer.  He may assign to 
all other officers, employees and agents of the SAVINGS BANK, duties in 
addition to those specifically described in these Bylaws.

      He shall have custody of the common seal and direct the use of it.  He 
shall have power to sign and execute any and all contracts, papers and legal 
documents.  He may delegate to Counsel or such other officers as are designated 
by the Board of Directors, the authority, under the seal of the SAVINGS BANK, 
to execute and acknowledge, in the name and on behalf of the SAVINGS BANK, all 
contracts, papers and documents incident or related to the business of the 
SAVINGS BANK, except where otherwise directed by law or by these Bylaws.

      Unless otherwise provided by resolution of the Board of Directors or 
these Bylaws, he may fill vacancies on committees and may appoint such other 
committees as he may deem necessary or the Board may require.  He shall perform 
such other duties as the Board of Directors may direct.

      The decisions of the Chairman of the Board on any matter, incident to the 
business of the SAVINGS BANK, shall be conclusive unless modified by the Board 
of Directors.

      SECTION 8.  EXECUTIVE VICE PRESIDENTS.  The Executive Vice Presidents 
shall perform such administrative and executive duties as are provided in these 
Bylaws, and as may be properly required of them or delegated to them by the 
Chairman, or as may from time to time be required by the Board of Directors, 
and shall exercise such powers as may from time to time be conferred upon them 
by the Board.

      In the absence or disability of the Chairman, the Board of Directors may 
designate an Executive Vice President to perform the duties and exercise the 
powers of such officers.

      SECTION 9.  SECRETARY.  The Secretary shall give due notice as in these 
Bylaws provided of all meetings of the Board of Directors and of the Executive 
Committee.  He shall attend all meetings of the Board and of said Committee and 
shall keep the minutes thereof.  If requested so to do he shall attend and keep 
the minutes of the meetings of any and all other committees of the Board.  He 
shall have custody of the corporate records of the SAVINGS BANK and its common 
seal; and when properly affixed to any document shall attest said seal.  He 
shall perform all of the usual duties of the Secretary of a corporation, 
together with such duties as may from time to time be properly assigned to him 
by the Chairman or the Board of Directors.

      SECTION 10.  SENIOR VICE PRESIDENTS.  The Senior Vice Presidents shall 
severally perform such duties and shall exercise such powers as may from time 
to time be assigned to or conferred upon them by the Board of Directors, and 
they shall perform such other duties as may be assigned to them by the Chairman.

      SECTION 11.  AUDITOR.  The Auditor shall, subject to the control and 
direction of the Board of Directors, have supervision and control of such 
program of internal audit as may be approved by the Board or be required by a 
body having supervisory or examining authority over the SAVINGS BANK; said 
program shall in any case, require periodic review and verification of the 
assets of the SAVINGS BANK, the control of items of income and the review of 
expenditures.  He shall also examine, or cause to be examined, and verify, or 
cause to be verified, entries in financial records and shall review, or cause 
to be reviewed all reports made to examining, supervisory and taxing 
authorities before they are forwarded or filed.  The Auditor shall report  in 
writing upon the foregoing matters to the Chairman at least as often as once in 
each quarter.   The Auditor also shall transmit directly to the Audit Committee 
of the Board of Directors such reports, quarterly or otherwise, as may be 
necessary for that Committee to perform its functions.  The Auditor shall also 
prepare or have prepared and shall submit any and all additional reports 
required of him at any time by the Board of Directors or the Chairman.

      SECTION 12.  OTHER OFFICERS.  The Chairman of the Board or the Board of 
Directors, upon recommendation of the Chairman of the Board, may in their 
discretion, from time to time, establish such other offices as it may deem wise 
and may elect incumbents thereof and fix their duties and powers not 
inconsistent with the provisions of these Bylaws.  Such officers, unless the 
Board shall by resolution duly adopted otherwise provide, shall hold office 
during the pleasure of the Board and the Chairman.



                   ARTICLE VI.  SECURITIES AND INVESTMENTS

      SECTION 1.  LOANS AND INVESTMENTS.  The Board of Directors shall from 
time to time determine and direct to what extent the funds and property of the 
SAVINGS BANK shall be invested, and, subject to all applicable provisions of 
law, the kind and character of the investments which are to be made and how the 
same shall be handled and dealt with.  No loans shall be contracted on behalf 
of the SAVINGS BANK and no evidence of indebtedness shall be issued in its name 
unless authorized by the Board of Directors.  Such authority may be general or 
confined to specific instances.

      SECTION 2.  CARE AND CUSTODY OF SECURITIES.  All stocks, bonds and other 
securities, including bonds and mortgages, not directed by the Board of 
Directors to be held in bearer form, or in the name of a nominee, shall be in 
the name of the SAVINGS BANK and, to the extent that the form of the several 
securities may permit or as may be permitted or required by law, shall be 
registered or recorded in the name of the SAVINGS BANK.  All securities 
including bonds and mortgages held by the SAVINGS BANK shall be kept in such 
manner and at such places as the Board of Directors, having due regard for the 
safety and protection thereof, may direct, and all or any part thereof may be 
lodged or deposited for safekeeping with such other institutions as the Board 
may from time to time approve.

      SECTION 3.  TRANSFERS OF SECURITIES, ETC.  Transfers and assignments of 
stocks, bonds and other securities standing, issued or registered in the name 
of the SAVINGS BANK may be signed by any two of the following officers acting 
by virtue of their several offices, to wit: the Chairman, the President, an 
Executive Vice President, the Secretary, or may be signed by any one of said 
officers together with such other officer or officers, or person or persons, as 
the Board of Directors may from time to time authorize or designate.

      The Chairman or the President, or in their absence an Executive Vice 
President (other than one serving as Mortgage Loan Officer) or the Secretary, 
shall execute any and all instruments for the proper transaction of the 
business of the SAVINGS BANK relating to its mortgage investments, including 
extensions, modifications, alterations, and amendments, assignments and 
satisfaction pieces.  The Board of Directors may, nevertheless, at any time 
authorize and empower other additional officers or employees to do any one or 
more of these things.



                ARTICLE VII.  DEPOSITORIES, CHECKS AND DRAFTS

      SECTION 1.  DEPOSITARIES AND WITHDRAWALS.  The Board of Directors may 
from time to time designate banks, trust companies or similar institutions to 
be depositaries of funds of the SAVINGS BANK and may by resolution designate 
the officer or officers, or employee or employees, who shall be authorized to 
sign the checks, drafts, vouchers or orders of the SAVINGS BANK upon which such 
depositaries shall be authorized to pay out the moneys so deposited.  Unless 
and until the Board shall otherwise provide, such checks, drafts, vouchers or 
orders for the payment of deposited funds shall be signed by any two of the 
following officers (other than one serving concurrently as Mortgage Loan 
Officer or Auditor): the Chairman, the President, an Executive Vice President, 
a Senior Vice President, a Vice President, the Secretary, the Comptroller, an 
Assistant Vice President, an Assistant Secretary, an Assistant Comptroller and 
the Assistant to the President, if the Board of Directors shall have 
established the offices of Assistant Vice President, Assistant Secretary, 
Assistant Comptroller or Assistant to the Chairman.

      SECTION 2.  DEPOSITORS' WITHDRAWALS.  The Chairman, the President, an 
Executive Vice President or the Secretary shall designate those officers and 
employees who shall be authorized to sign or countersign checks drawn upon the 
general deposit accounts of the SAVINGS BANK issued in payment of depositor 
withdrawals.

      The Board of Directors may also adopt such other means of payment of 
depositor withdrawals as to it may seem proper and expedient.



          ARTICLE VIII.  CERTIFICATES FOR SHARES AND THEIR TRANSFER

      SECTION 1.  CERTIFICATES FOR SHARES.  Certificates representing shares of 
capital stock of the SAVINGS BANK shall be in such form as shall be determined 
by the Board of Directors and approved by the NYB.  Such certificates shall be 
signed by the Chairman of the Board or by any other officer of the SAVINGS BANK 
authorized by the Board, attested by the secretary or an assistant secretary, 
and sealed with the corporate seal or a facsimile thereof.  The signatures of 
such officers upon a certificate may be facsimiles if the certificate is 
manually signed on behalf of a transfer agent or a registrar, other than the 
SAVINGS BANK itself or one of its employees.  Each certificate for shares of 
capital stock shall be consecutively numbered or otherwise identified.  The 
name and address of the person to whom the shares are issued, with the number 
of shares and date of issue, shall be entered on the stock transfer books of 
the SAVINGS BANK.  All certificates surrendered to the SAVINGS BANK for 
transfer shall be canceled and no new certificate shall be issued until the 
former certificate for a like number of shares has been surrendered and 
canceled, except that in case of a lost or destroyed certificate, a new 
certificate may be issued upon such terms and indemnity to the SAVINGS BANK as 
the Board of Directors may prescribe.

      SECTION 2.  TRANSFER OF SHARES.  Transfer of shares of capital stock of 
the SAVINGS BANK shall be made only on its stock transfer books.  Authority for 
such transfer shall be given only by the holder of record or by his legal 
representative, who shall furnish proper evidence of such authority, or by his 
attorney authorized by a duly executed power of attorney and filed with the 
SAVINGS BANK.  Such transfer shall be made only on surrender for cancellation 
of the certificate for such shares.  The person in whose name shares of capital 
stock stand on the books of the SAVINGS BANK shall be deemed by the SAVINGS 
BANK to be the owner for all purposes.



                    ARTICLE IX.  FISCAL YEAR; ANNUAL AUDIT

      The fiscal year of the SAVINGS BANK shall be as fixed by the Board of 
Directors.  The SAVINGS BANK shall be subject to an annual audit as of the end 
of its fiscal year by independent public accountants appointed by and 
responsible to the Board of Directors.  The appointment of such accountants 
shall be subject to annual ratification by the shareholders.



                            ARTICLE X.  DIVIDENDS

      Subject to the terms of the SAVINGS BANK's Restated Organization 
Certificate and the regulations and orders of the NYB, the Board of Directors 
may, from time to time, declare, and the SAVINGS BANK may pay, dividends on its 
outstanding shares of capital stock.



                         ARTICLE XI.  CORPORATE SEAL

      The Board of Directors shall provide a SAVINGS BANK seal, which shall be 
two concentric circles between which shall be the name of the SAVINGS BANK.  
The year of incorporation or an emblem may appear in the center.



                          ARTICLE XII.  SURETY BONDS

      SECTION 1.  SURETY BONDS AND PREMIUMS THEREON.  The SAVINGS BANK shall 
procure from a responsible surety company approved by the Board of Directors 
and shall keep continuously in force and effect a banker's blanket bond of 
insurance or a fidelity bond of similar type and character covering all of the 
officers and employees of the SAVINGS BANK in such amount as the Board may fix. 
The Board may also require that individual officers or employees shall furnish 
separate bonds conditioned on the faithful performance of their several duties. 
It shall be obligatory upon the officers and employees to furnish to the 
SAVINGS BANK and to the surety company involved any and all information 
necessary or appropriate to the procurement of any bond or bonds herein 
provided for.  The SAVINGS BANK may dismiss any officer or employee who shall 
fail when asked or who shall refuse to give any and all proper and relevant 
information required by the designated surety company or as to whom such surety 
company shall decline to give a bond or whom the surety company shall decline 
to include in a general bond.

      All expenses connected with such bond or bonds and all premiums thereon 
shall be borne by the SAVINGS BANK.



                        ARTICLE XIII.  INDEMNIFICATION

      SECTION 1.  SCOPE OF INDEMNIFICATION.  Except to the extent expressly 
prohibited by the New York Banking Law, the SAVINGS BANK shall indemnify each 
person made, or threatened to be made, a party to any action or proceeding, 
whether criminal or civil, by reason of the fact that such person or such 
person's testator or intestate is or was a director or officer of the SAVINGS 
BANK, or is or was serving, in any capacity, at the request of the SAVINGS 
BANK, any other corporation, or any partnership, joint venture, trust, employee 
benefit plan or other enterprise, against judgments, fines, penalties, amounts 
paid in settlement and reasonable expenses, including attorneys' fees and 
expenses, reasonably incurred in enforcing such person's right to 
indemnification, incurred in connection with such action or proceeding, or any 
appeal therein, provided that no such indemnification shall be made if a 
judgment or other final adjudication adverse to such persons establishes that 
such person's acts were committed in bad faith or were the result of active and 
deliberate dishonesty and were material to the cause of action so adjudicated, 
or that such person personally gained in fact a financial profit or other 
advantage to which such person was not legally entitled, and provided that no 
such indemnification shall be required with respect to any settlement or other 
nonadjudicated disposition of any threatened or pending action or proceeding 
unless the SAVINGS BANK has given its prior consent to such settlement or other 
disposition.

      SECTION 2.  REIMBURSEMENT OF EXPENSES.  The SAVINGS BANK shall advance or 
promptly reimburse upon request any person entitled to indemnification 
hereunder for all reasonable expenses, including attorneys' fees and expenses, 
reasonably incurred in defending any action or proceeding in advance of the 
final disposition thereof upon receipt of an undertaking by or on behalf of 
such person to repay such amount if such person is ultimately found not to be 
entitled to indemnification or, where indemnification is granted, to the extent 
the expenses so advanced or reimbursed exceed the amount to which such person 
is entitled;  provided, however, that such person shall cooperate in good faith 
with any request by the SAVINGS BANK that common counsel be used by the parties 
to any action or proceeding who are similarly situated unless to do so would be 
inappropriate due to actual or potential differing interest between or among 
parties.

      SECTION 3.  ADDITIONAL RIGHTS.  Nothing herein shall limit or affect any 
right of any  director, officer, or other corporate personnel otherwise than 
hereunder to indemnification or expenses, including attorneys' fees and 
expenses, under any statute, rule, regulation, certificate of incorporation, 
Bylaws, insurance policy, contract, or otherwise; without affecting or limiting 
the rights of any director, officer or other corporate personnel pursuant to 
this Article XIII, the SAVINGS BANK is authorized to enter into agreements with 
any of its directors, officers or other corporate personnel extending rights to 
indemnification and advancement of expenses to the fullest extent permitted by 
applicable law.

      SECTION 4.  NOTICE OF AMENDMENTS OR ELIMINATION.  Anything in these 
Bylaws to the contrary notwithstanding, no elimination or amendment of this 
Article adversely affecting the right of any person to indemnification or 
advancement of expenses hereunder shall be effective until the 60th day 
following notice to such person of such action, and no elimination of or 
amendment to this Article XIII shall deprive any such person's rights hereunder 
arising out of alleged or actual occurrences, act or failures to act prior to 
such 60th day.  Any amendments or eliminations made pursuant to this Section 
are only effective with regard to acts occurring after such date.

      SECTION 5.  AMENDMENT OR ELIMINATION.  The SAVINGS BANK shall not, except 
by elimination or amendment of this Article XIII in a manner consistent with 
the preceding Section 4, take any corporate action or enter into any agreement 
which prohibits, or otherwise limits the rights of any person to, 
indemnification in accordance with the provisions of this Article XIII.  The 
indemnification of any person provided by this Article XIII shall continue 
after such person has ceased to be a director or officer of the SAVINGS BANK 
and shall inure to the benefit of such person's heirs, executors, 
administrators and legal representatives.

      SECTION 6.  SEVERABILITY OF PROVISION.  In case any provision in this 
Article XIII shall be determined at any time to be unenforceable in any 
respect, the other provisions of this Article XIII shall not in any way be 
affected or impaired thereby, and the affected provision shall be given the 
fullest possible enforcement in the circumstances, it being the intention of 
the SAVINGS BANK to afford indemnification and advancement of expenses to its 
directors or officers, acting in such capacities or in the other capacities 
mentioned herein, to the fullest extent permitted by law.



                     ARTICLE XIV.  RULES AND REGULATIONS

      Management shall adopt rules and regulations not inconsistent with law 
for the payment of deposits and interest and, generally, for the transaction 
and management of the affairs of the SAVINGS BANK.  Such rules and regulations 
shall be posted in a conspicuous place in the offices of the SAVINGS BANK and 
shall be available to depositors upon request.  Such posting shall be taken and 
held as actual notice to and be binding upon each depositor and to all persons 
claiming any interest in any account.  All notices to the SAVINGS BANK from 
depositors, or other persons claiming any interest in any account, shall be not 
effective unless they are in writing and signed by the persons giving such 
notice.

      Rules and regulations adopted by management or any amendments thereto 
shall be transmitted to the Board of Directors at its next regular monthly 
meeting following the adoption of same.



                           ARTICLE XV.  AMENDMENTS

      These Bylaws may be amended in a manner consistent with regulations of 
the NYB at any time by a majority vote of the Whole Board of Directors, or by 
the affirmative vote of at least 80% of the votes eligible to be cast by the 
shareholders of the SAVINGS BANK at any legal meeting. 


                             EMPLOYMENT AGREEMENT



       AGREEMENT by and among GREENPOINT FINANCIAL CORP., a Delaware 
corporation (the "Company"), GREENPOINT BANK, a New York chartered savings bank 
(the "Bank")  and BHARAT B. BHATT (the "Executive"), dated as of the 21st day 
of August, 1995.

      1.  CHANGE OF CONTROL.  For the purpose of this Agreement, a "Change of 
Control" shall mean:

      (a)  The acquisition by any individual, entity or group (within the 
meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, 
as amended (the "Exchange Act") (a "Person") of beneficial ownership (within 
the meaning of Rule 13d-3 promulgated under the Exchange Act) of 20% or more of 
either (i) the then outstanding shares of common stock of the Company (the 
"Outstanding Company Common Stock") or (ii) the combined voting power of the 
then outstanding voting securities of the Company entitled to vote generally in 
the election of directors (the "Outstanding Company Voting Securities"); 
PROVIDED, HOWEVER, that for purposes of this subsection (a), the following 
acquisitions shall not constitute a Change of Control:  (i) any acquisition 
directly from the Company, (ii) any acquisition by the Company, (iii) any 
acquisition by any employee benefit plan (or related trust) sponsored or 
maintained by the Company or any corporation controlled by the Company or (iv) 
any acquisition by any corporation pursuant to a transaction which complies 
with clauses (i), (ii) and (iii) of subsection (c) of this Section 1; or

      (b)  individuals who, as of the date hereof, constitute the Board of 
Directors of the Company (the "Incumbent Board") cease for any reason  to 
constitute at least a majority of the Board of Directors of the Company (the 
"Board"); PROVIDED, HOWEVER, that any individual becoming a director subsequent 
to the date hereof whose election, or nomination for election by the Company's 
shareholders, was approved by a vote of at least a majority of the directors 
then comprising the Incumbent Board shall be considered as though such 
individual were a member of the Incumbent Board, but excluding, for this 
purpose, any such individual whose initial assumption of office occurs as a 
result of an actual or threatened election contest with respect to the election 
or removal of directors or other actual or threatened solicitation of proxies 
or consents by or on behalf of a Person other than the Board; or

      (c)  consummation of a reorganization, merger or consolidation or sale or 
other disposition of all or substantially all of the assets of the Company (a 
"Business Combination"), in each case, unless, following such Business 
Combination, (i) all or substantially all of the individuals and entities who 
were the beneficial owners, respectively, of the Outstanding Company Common 
Stock and Outstanding Company Voting Securities immediately prior to such 
Business Combination beneficially own, directly or indirectly, more than 50% 
of, respectively, the then outstanding shares of common stock and the combined 
voting power of the then outstanding voting securities entitled to vote 
generally in the election of directors, as the case may be, of the corporation 
resulting from such Business Combination (including, without limitation, a 
corporation which as a result of such transaction owns the Company or all or 
substantially all of the Company's assets either directly or through one or 
more subsidiaries) in substantially the same proportions as their ownership, 
immediately prior to such Business Combination of the Outstanding Company 
Common Stock and Outstanding Company Voting Securities, as the case may be, 
(ii) no Person (excluding any employee benefit plan (or related trust) of the 
Company or such corporation resulting from such Business Combination) 
beneficially owns, directly or indirectly, 20% or more of, respectively, the 
then outstanding shares of common stock of the corporation resulting from such 
Business Combination or the combined voting power of the then outstanding 
voting securities of such corporation except to the extent that such ownership 
existed prior to the Business Combination and (iii) at least a majority of the 
members of the board of directors of the corporation resulting from such 
Business Combination were members of the Incumbent Board at the time of the 
execution of the initial agreement, or of the action of the Board, providing 
for such Business Combination; or

      (d)  approval by the shareholders of the Company of a complete 
liquidation or dissolution of the Company.

      2.  EFFECTIVE DATE.   For the purpose of this Agreement, "Effective Date" 
shall mean the first date after the date hereof on which a Change of Control 
(as defined in Section 1) occurs.  Anything in this Agreement to the contrary 
notwithstanding, if a Change of Control occurs and if the Executive's 
employment with the Company is terminated prior to the date on which the Change 
of Control occurs, and if it is reasonably demonstrated by the Executive that 
such termination of employment (i) was at the request of a third party who has 
taken steps reasonably calculated to effect a Change of Control or (ii) 
otherwise arose in connection with or anticipation of a Change of Control, then 
for all purposes of this Agreement the "Effective Date" shall mean the date 
immediately prior to the date of such termination of employment.

       3.  TERM.(a)  EMPLOYMENT PERIOD.  The Company and the Bank hereby agree 
to continue the Executive in their employ, and the Executive hereby agrees to 
remain in the employ of the Company and the Bank subject to the terms and 
conditions of this Agreement, for the period commencing on the date hereof (the 
"Commencement Date")and ending on the third anniversary of such date (the 
"Employment Period"); PROVIDED, HOWEVER, that commencing with the Commencement 
Date, the Employment Period shall be extended for one day each day until such 
time as the Board of Directors of the Company and the Bank or the Executive 
elects not to extend the term of the Agreement further by giving written notice 
to the other party in accordance with Section 12(b) of this Agreement in which 
case the term of this Agreement shall end on the third anniversary of the date 
of such written notice.  The Board of Directors of the Company and the Bank 
will review the Agreement and the Executive's performance annually for purposes 
of determining whether to give notice not to extend the Agreement, and the 
results thereof shall be included in the minutes of the Boards' meeting.  
Notwithstanding anything in this Agreement to the contrary and pursuant to 
Section 5(c) hereof, the Employment Period shall cease and Executive's 
employment shall terminate on the Executive's retirement date in accordance 
with the Company's and the Bank's general retirement policy as it exists from 
time to time.

      (b)  TERMINATION OF EMPLOYMENT.  (i) Executive's employment with the 
Company and the Bank may be terminated at any time for (i)cause, (ii) 
disability, (iii) death or (iv) any other reason.  In any such case, the right 
to terminate shall be specifically conditioned on satisfaction of the Company's 
or the Bank's obligations, if any, provided hereunder, including but not 
limited to all payments required under Section 6.

         (ii) Upon the termination of Executive's employment with the Company 
or the Bank, the daily extension provided pursuant to Section 3(a), shall cease 
(if such extensions have not previously ceased).

      4.  TERMS OF EMPLOYMENT.  (a)  POSITION AND DUTIES.  (i) Commencing on 
the date hereof and for the remainder of the Employment Period, the Executive 
shall be Vice Chairman of the Company and the Bank and shall have such duties, 
responsibilities and authority as shall be consistent therewith, as determined 
from time to time prior to the Effective Date by or under the authority of the 
Boards of Directors of the Company and the Bank (the "Boards"), as the case may 
be. 

           (ii) During the Employment Period, except for periods of absence 
occasioned by illness, reasonable vacation periods, and reasonable leaves of 
absence, the Executive shall devote substantially all of his business time, 
attention, skill and efforts to the business and affairs of the Company and the 
Bank and the faithful performance of his responsibilities under this Agreement. 
During the Employment Period it shall not be a violation of this Agreement for 
the Executive to (A) serve on corporate, civic or charitable boards or 
committees, (B) deliver lectures, fulfill speaking engagements or teach at 
educational institutions and (C) manage personal investments, so long as such 
activities do not, in the judgement of the Boards, present any conflict of 
interest with the Company and the Bank, or materially affect the performance of 
Executive's duties pursuant to this Agreement.  It is expressly understood and 
agreed that to the extent that any such activities have been conducted by the 
Executive prior to the Commencement Date, the continued conduct of  such 
activities (or the conduct of activities similar in nature and scope thereto) 
subsequent to the Commencement Date shall not thereafter be deemed to present a 
conflict of interest with the Company and the Bank, or materially affect the 
performance of Executive's duties pursuant to this Agreement.

      (b)  COMPENSATION.  (i)  BASE SALARY.  During the Employment Period, the 
Executive shall receive an annual base salary ("Annual Base Salary") of not 
less than $325,000.  The Annual Base Salary shall be paid periodically in the 
same frequency as other officers of the Company.  During the Employment Period, 
the Annual Base Salary shall be reviewed at least annually.  Any increase in 
Annual Base Salary shall not serve to limit or reduce any other obligation to 
the Executive under this Agreement.  Annual Base Salary shall not be reduced 
after any such increase and the term Annual Base Salary as utilized in this 
Agreement shall refer to Annual Base Salary as so increased. 

         (ii)  ANNUAL BONUS.  In addition to Annual Base Salary, the Executive 
shall be awarded, for each fiscal year ending during the Employment Period, an 
annual bonus (the "Annual Bonus") pursuant to the Company's annual incentive 
plans, with a target bonus of 50% of Annual Base Salary (the "Target Bonus") 
and a maximum bonus of 100% of Annual Base Salary (the "Maximum Bonus"); 
PROVIDED, HOWEVER, after the Effective Date, the Annual Bonus shall be no less 
than the Target Bonus.  Each such Annual Bonus shall be paid no later than the 
end of the third month of the fiscal year next following the fiscal year for 
which the Annual Bonus is awarded, unless the Executive shall elect to defer 
the receipt of such Annual Bonus.

         (iii)  INCENTIVE, SAVINGS AND RETIREMENT PLANS.  During the Employment 
Period, the Executive shall be eligible to participate in all incentive, 
savings and retirement plans, practices, policies and programs applicable 
generally to other peer executives of the Company and its affiliated companies 
and pursuant to the provisions of such plans, practices, policies and programs, 
provided that after the Effective Date in no event shall such plans, practices, 
policies and programs provide the Executive with incentive opportunities 
(measured with respect to both regular and special incentive opportunities, to 
the extent, if any, that such distinction is applicable), savings opportunities 
and retirement benefit opportunities, in each case, less favorable, in the 
aggregate, than the most favorable of those provided by the Company and its 
affiliated companies for the Executive under such plans, practices, policies 
and programs as in effect at any time during the 120-day period immediately 
preceding the Effective Date or if more favorable to the Executive, those 
provided generally at any time after the Effective Date to other peer 
executives of the Company and its affiliated companies.


         (iv)  WELFARE BENEFIT PLANS.  During the Employment Period, the 
Executive and/or the Executive's family, as the case may be, shall be eligible 
for participation in and shall receive all benefits under welfare benefit 
plans, practices, policies and programs provided by the Company and its 
affiliated companies (including, without limitation, medical, prescription, 
dental, disability, salary continuance, employee life, group life, accidental 
death and travel accident insurance plans and programs) to the extent 
applicable generally to other peer executives of the Company and its affiliated 
companies and pursuant to the provisions of such plans, practices, policies and 
programs, provided that after the Effective Date in no event shall such plans, 
practices, policies and programs provide the Executive with benefits which are 
less favorable, in the aggregate, than the most favorable of such plans, 
practices, policies and programs in effect for the Executive at any time during 
the 120-day period immediately preceding the Effective Date or, if more 
favorable to the Executive, those provided generally at any time after the 
Effective Date to other peer executives of the Company and its affiliated 
companies.

         (v)  EXPENSES.  During the Employment Period, the Executive shall be 
entitled to receive prompt reimbursement for all reasonable business expenses 
incurred by the Executive in performing his obligations under this Agreement.

         (vi)  FRINGE BENEFITS.  During the Employment Period, the Executive 
shall be entitled to fringe benefits provided generally to other peer 
executives of the Company.

         (vii)  VACATION.  During the Employment Period, the Executive shall be 
entitled to paid vacation in accordance with current policies.

         (viii)  SUPPLEMENTAL RETIREMENT BENEFIT.  The Company will provide 
Executive with a supplemental retirement benefit, after offset of all other 
retirement benefits received from the Company and its affiliates and any 
previous employers and the employers' portion of social security, of 60% of 
Executive's final average pay, which shall be defined as the average of his 
highest three years of Annual Base Salary and Annual Bonus during the shorter 
of (x) the ten years prior to the date of his termination of employment with 
the Company, and (y) the term of his employment with the Company.  Benefits 
will accrue ratably over ten years (i.e.,6% of final average pay per year), 
with accrued benefits vesting after 5 years.

      5.  TERMINATION OF EMPLOYMENT.  (a)  DEATH OR DISABILITY.  The 
Executive's employment shall terminate automatically upon the Executive's death 
during the Employment Period.  If the Company determines in good faith that the 
Disability of the Executive has occurred during the Employment Period (pursuant 
to the definition of Disability set forth below), it may give to the Executive 
written notice in accordance with Section 12(b) of this Agreement of its 
intention to terminate the Executive's employment.  In such event, the 
Executive's employment with the Company shall terminate effective on the 30th 
day after receipt of such notice by the Executive (the "Disability Effective 
Date"), provided that, within the 30 days after such receipt, the Executive 
shall not have returned to full-time performance of the Executive's duties.  
For purposes of this Agreement, "Disability" shall mean the absence of the 
Executive from the Executive's duties with the Company on a full-time basis for 
the greater of (x)  180 consecutive business days, and (y) the Executive's 
cumulative unused sick days, in each case as a result of incapacity due to 
mental or physical illness which is determined to be total and permanent by a 
physician selected by the Company or its insurers and acceptable to the 
Executive or the Executive's legal representative.

      (b)  CAUSE.  The Company may terminate the Executive's employment during 
the Employment Period for Cause.  For purposes of this Agreement, "Cause" shall 
mean:

         (i)  the willful and continued failure of the Executive to perform 
substantially the Executive's duties with the Company or the Bank or one of 
their affiliates (other than any such failure resulting from incapacity due to 
physical or mental illness), after a written demand for substantial performance 
is delivered to the Executive by the Board or the Chief Executive Officer of 
the Company which specifically identifies the manner in which the Board or 
Chief Executive Officer believes that the Executive has not substantially 
performed the Executive's duties, or

         (ii)  the Executive's personal dishonesty, willful misconduct, any 
breach of fiduciary duty involving personal profit, willful violation of any 
law, rule, regulation (other than traffic violations or similar offenses) or 
final cease and desist order or any material breach of any provision of this 
Agreement.

For purposes of this provision, no act or failure to act, on the part of the 
Executive, shall be considered "willful" unless it is done, or omitted to be 
done, by the Executive not in good faith or without reasonable belief that the 
Executive's action or omission was in the best interests of the Company or the 
Bank or their affiliates.  Any act, or failure to act, based upon authority 
given pursuant to a resolution duly adopted by the Board or the Boards, as the 
case may be, or based upon the advice of counsel for the Company or the Bank 
shall be conclusively presumed to be done, or omitted to be done, by the 
Executive in good faith and in the best interests of the Company or the Bank or 
their affiliates.  The cessation of employment of the Executive shall not be 
deemed to be for Cause unless and until there shall have been delivered to the 
Executive a copy of a resolution duly adopted by the affirmative vote of a 
majority of the entire membership of the Board at a meeting of the Board called 
and held for such purpose (after reasonable notice is provided to the Executive 
and the Executive is given an opportunity, together with counsel, to be heard 
before the Board), finding that, in the good faith opinion of the Board, the 
Executive is guilty of the conduct described in subparagraph (i) or (ii) above, 
and specifying the particulars thereof in detail.

      (c)  RETIREMENT.  The Executive's employment shall terminate as a result 
of retirement in accordance with the Company's and the Bank's general 
retirement policy as it exists from time to time ("Retirement"), provided that 
after  the Effective Date such policy may be no less favorable to the Executive 
than that existing during the 120-day period immediately prior to the Effective 
Date.

      (d)  GOOD REASON.  The Executive's employment may be terminated by the 
Executive for Good Reason.  For purposes of this Agreement, "Good Reason" shall 
mean:

         (i)  the assignment to the Executive of any duties inconsistent with 
the Executive's position (including status, offices, titles and reporting 
requirements), authority, duties or responsibilities as contemplated by Section 
4(a) of this Agreement, or any other action by the Company or the Bank which 
results in a diminution in such position, authority, duties or 
responsibilities, excluding for this purpose an isolated, insubstantial and 
inadvertent action taken in good faith and which is remedied by the Company or 
the Bank promptly after receipt of notice thereof given by the Executive;

         (ii)  any failure by the Company to comply with any of the provisions 
of Section 4(b) of this Agreement, unless waived by the Executive, other than 
an isolated, insubstantial and inadvertent failure occurring in good faith and 
which is remedied by the Company promptly after receipt of notice thereof given 
by the Executive;

         (iii)  the Company's requiring the Executive to be based at any office 
or location after the Effective Date other than where the Executive was located 
immediately prior to the Effective Date other than in connection with a change 
of the Company's headquarters if the Executive is relocated to such 
headquarters, or, after the Effective Date, the Company's requiring the 
Executive to travel on Company business to a substantially greater extent than 
required immediately prior to the Effective Date, in either case, unless waived 
by the Executive.

         (iv)  any purported termination by the Company of the Executive's 
employment otherwise than as expressly  permitted by this Agreement; or

         (v)  any failure by the Company to comply with and satisfy Section 
11(c) of this Agreement, unless waived by the Executive.


For purposes of this Section 5(d), any good faith determination of "Good 
Reason" made by the Executive shall be conclusive.  Anything in this Agreement 
to the contrary notwithstanding, a termination by the Executive for any reason 
during the 30-day period immediately following the first anniversary of the 
Effective Date shall be deemed to be a termination for Good Reason for all 
purposes of this Agreement.
 
      (e)  NOTICE OF TERMINATION.  Any purported termination by the Company, or 
by the Executive shall be communicated by Notice of Termination to the other 
party hereto given in accordance with Section 12(b) of this Agreement.  For 
purposes of this Agreement, a "Notice of Termination" means a written notice 
which (i) indicates the specific termination provision in this Agreement relied 
upon, (ii) to the extent applicable, sets forth in reasonable detail the facts 
and circumstances claimed to provide a basis for termination of the Executive's 
employment under the provision so indicated and (iii) if the Date of 
Termination (as defined below) is other than the date of receipt of such 
notice, specifies the termination date (which date shall be not more than 
thirty days after the giving of such notice). 

      (f)  DATE OF TERMINATION.  "Date of Termination" means (i) if the 
Executive's employment is terminated by the Company for Cause, or by the 
Executive for Good Reason or other than Good Reason, the date of receipt of the 
Notice of Termination or any later date specified therein, as the case may be, 
(ii) if the Executive's employment is terminated by the Company other than for 
Cause or Disability, the Date of Termination shall be the date on which the 
Company notifies the Executive of such termination and (iii) if the Executive's 
employment is terminated by reason of death, Disability or Retirement, the Date 
of Termination shall be the date of death of the Executive, the Disability 
Effective Date or the date of Retirement, as the case may be.

      6.  OBLIGATIONS OF THE COMPANY UPON TERMINATION.  (a)  GOOD REASON; OTHER 
THAN FOR CAUSE, RETIREMENT, DEATH OR DISABILITY.  If, during the Employment 
Period, the Company shall terminate the Executive's employment other than for 
Cause or Disability or the Executive shall terminate employment for Good Reason:

         (i)  the Company shall pay to the Executive in a lump sum in cash 
within 30 days after the Date of Termination the    aggregate of the following 
amounts (the "Special Termination Amount"):

             A.  the sum of (1) the Executive's Annual Base Salary through the 
Date of Termination to the extent not theretofore paid, (2) the product of (x) 
the higher of (i) the Maximum Bonus and (II) the Annual  Bonus paid or payable, 
including any bonus or portion thereof which has been earned but deferred (and 
annualized for any fiscal year consisting of less than twelve full months or 
during which the Executive was employed for less than twelve full months), for 
the most recently completed fiscal year during the Employment Period, if any 
(such higher amount being referred to as the "Highest Annual Bonus") and (y) a 
fraction, the numerator of which is the number of days in the current fiscal 
year through the Date of Termination, and the denominator of which is 365 and 
(3) any compensation previously deferred by the Executive (together with any 
accrued interest or earnings thereon) and any accrued vacation pay, in each 
case to the extent not theretofore paid (the sum of the amounts described in 
clauses (1), (2), and (3) shall be hereinafter referred to as the "Accrued 
Obligations"); and

             B.  the amount equal to the product of (1) three and (2) the sum 
of (x) the Executive's Annual Base Salary and (y) the Highest Annual Bonus; and

             C.  an amount equal to the difference between (a) the actuarial 
equivalent of the benefit (utilizing actuarial assumptions no less favorable to 
the Executive than those in effect under the Company's qualified defined 
benefit retirement plan (the "Retirement Plan"))under the Retirement Plan 
immediately prior to the Effective Date, and any excess or supplemental 
retirement plan in which the Executive participates (together, the "SERP") 
which the Executive would receive if the Executive's employment continued for 
three years after the Date of Termination assuming for this purpose that all 
accrued benefits are fully vested, and, assuming that the Executive's 
compensation in each of the three years is the sum of Executive's Annual Base 
Salary and the Maximum Bonus, and (b) the actuarial equivalent of the 
Executive's actual benefit (paid or payable), if any, under the Retirement Plan 
and the SERP as of the Date of Termination.  In the event it shall be 
determined that a payment by the Company to or for the benefit of the Executive 
shall be made pursuant to the terms of this Section 6(a) as a result of 
Executive's termination of employment as described hereunder solely as a result 
of a Change of Control (as defined in Section 1), then under clause (a) of this 
Subsection 6(a)(i)C, solely for purposes of determining the actuarial 
equivalent of the supplemental retirement benefit described in Section 
4(b)(viii) of this Agreement, and not the actuarial equivalent of the benefit 
under the Retirement Plan or any other excess or supplemental retirement plan 
in which the Executive participates, the words "five years" should be 
substituted for the words "three years" each time they appear in such clause 
(a);

         (ii)  for three years after the Executive's Date of Termination, or 
such longer period as may be provided by the terms of the appropriate plan, 
program, practice or policy, the Company shall continue benefits to the 
Executive and/or the Executive's family at least equal to those which would 
have been provided to them in accordance with the plans, programs, practices 
and policies described in Section 4(b)(iv) of this Agreement if the Executive's 
employment had not been terminated or, if  more favorable to the Executive, as 
in effect generally at any time thereafter with respect to other peer 
executives of the Company and its affiliated companies and their families, 
PROVIDED, HOWEVER, that if the Executive becomes reemployed with another 
employer and is eligible to receive medical or other welfare benefits under 
another employer-provided plan, the medical and other welfare benefits 
described herein shall be secondary to those provided under such other plan 
during such applicable period of eligibility.  For purposes of determining 
eligibility (but not the time of commencement of benefits) of the Executive for 
retiree benefits pursuant to such plans, practices, programs and policies, the 
Executive shall be considered to have remained employed until three years after 
the Date of Termination and to have retired on the last day of such period; 

         (iii)  the Company shall, at its sole expense as incurred, provide the 
Executive with outplacement services the scope and provider of which shall be 
selected by the Executive in his reasonable discretion; and 

         (iv)  to the extent not theretofore paid or provided, the Company 
shall timely pay or provide to the Executive any other amounts or benefits 
required to be paid or provided or which the Executive is entitled to receive 
under any plan, program, policy or practice or contract or agreement of the 
Company and its affiliated companies (such other amounts and benefits shall be 
hereinafter referred to as the "Other Benefits").

      (b)  DEATH.  If the Executive's employment is terminated by reason of the 
Executive's death during the Employment Period, this Agreement shall terminate 
without further obligations to the Executive's legal representatives under this 
Agreement, other than for payment of Accrued Obligations, the Special 
Termination Amount and the timely payment or provision of Other Benefits.  The 
Special Termination Amount and Accrued Obligations shall be paid to the 
Executive's estate or beneficiary, as applicable, in a lump sum in cash within 
30 days of the Date of Termination.  With respect to the provision of Other 
Benefits after the Effective Date, the term Other Benefits as utilized in this 
Section 6(b) shall include, without limitation, and the Executive's estate 
and/or beneficiaries shall be entitled to receive, benefits at least equal to 
the most favorable benefits provided by the Company and its affiliated 
companies to the estates and beneficiaries of peer executives of the Company 
and such affiliated companies under such plans, programs, practices and 
policies relating to death benefits, if any, as are in effect with respect to 
other peer executives and their  beneficiaries at any time during the 120-day 
period immediately preceding the Effective Date or, if more favorable to the 
Executive's estate and/or the Executive's beneficiaries, as are in effect on 
the date of the Executive's death with respect to other peer executives of the 
Company and its affiliated companies and their beneficiaries. 

      (c)  DISABILITY.  If the Executive's employment is terminated by reason 
of the Executive's Disability during the Employment Period, this Agreement 
shall terminate without further obligations to the Executive, other than for 
payment of Accrued Obligations, the Special Termination Amount and the timely 
payment or provision of Other Benefits.  Accrued Obligations and the Special 
Termination Amount shall be paid to the Executive in a lump sum in cash within 
30 days of the Date of Termination.  With respect to the provision of Other 
Benefits after the Effective Date, the term Other Benefits as utilized in this 
Section 6(c) shall include, and the Executive shall be entitled after the 
Disability Effective Date to receive, disability and other benefits at least 
equal to the most favorable of those generally provided by the Company and its 
affiliated companies to disabled executives and/or their families in accordance 
with such plans, programs, practices and policies relating to disability, if 
any, as are in effect generally with respect to other peer executives and their 
families at any time during the 120-day period immediately preceding the 
Effective Date or, if more favorable to the Executive and/or the Executive's 
family, as are in effect at any time thereafter generally with respect to other 
peer executives of the Company and its affiliated companies and their families.

      (d)  RETIREMENT  If the Executive's employment is terminated by reason of 
the Executive's Retirement during the Employment Period, this Agreement shall 
terminate without further obligations to the Executive under this agreement, 
other than for payment of Accrued Obligations, and the timely payment or 
provision of Other Benefits.  Accrued Obligations shall be paid to the 
Executive in a lump sum in cash within 30 days of the Date of Termination.  
With respect to the provision of Other Benefits after the Effective Date, the 
term Other Benefits as utilized in this Section 6(d) shall include, without 
limitation, and the Executive shall be entitled to receive, benefits at least 
equal to the most favorable benefits provided by the Company and its affiliated 
companies to peer executives of the Company and such affiliated companies under 
such plans, programs, practices and policies relating to retirement benefits, 
if any, as are in effect with respect to other peer executives and their 
beneficiaries at any time during the 120-day period immediately preceding the 
Effective Date or, if more favorable to the Executive, as are in effect on the 
date of  the Executive's Retirement with respect to other peer executives of 
the Company and its affiliated companies.

      (e)  CAUSE; OTHER THAN FOR GOOD REASON.  If the Executive's employment 
shall be terminated for Cause during the Employment Period, this Agreement 
shall terminate without further obligations to the Executive other than the 
obligation to pay to the Executive (x) his Annual Base Salary through the Date 
of Termination, (y) the amount of any compensation previously deferred by the 
Executive, and (z) Other Benefits, in each case to the extent theretofore 
unpaid.  If the Executive voluntarily terminates employment during the 
Employment Period, excluding a termination for Good Reason, this Agreement 
shall terminate without further obligations to the Executive, other than for 
Accrued Obligations and the timely payment or provision of Other Benefits.  In 
such case, all Accrued Obligations shall be paid to the Executive in a lump sum 
in cash within 30 days of the Date of Termination. 

      7.  NON-EXCLUSIVITY OF RIGHTS.  Nothing in this Agreement shall prevent 
or limit the Executive's continuing or future participation in any plan, 
program, policy or practice provided by the Company or any of its affiliated 
companies and for which the Executive may qualify nor shall anything herein 
limit or otherwise affect such rights as the Executive may have under any 
contract or agreement with the Company or any of its affiliated companies.  
Amounts which are vested benefits or which the Executive is otherwise entitled 
to receive under any plan, policy, practice or program of or any contract or 
agreement with the Company or any of its affiliated companies at or subsequent 
to the Date of Termination shall be payable in accordance with such plan, 
policy, practice or program or contract or agreement except as explicitly 
modified by this Agreement.

      8.  FULL SETTLEMENT.  The Company's obligation to make the payments 
provided for in this Agreement and otherwise to perform its obligations 
hereunder shall not be affected by any set-off, counterclaim, recoupment, 
defense or other claim, right or action which the Company may have against the 
Executive or others.  In no event shall the Executive be obligated to seek 
other employment or take any other action by way of mitigation of the amounts 
payable to the Executive under any of the provisions of this Agreement and such 
amounts shall not be reduced whether or not the Executive obtains other 
employment.  The Company agrees to pay as incurred, to the full extent 
permitted by law, all legal fees and expenses which the Executive may 
reasonably incur as  a result of any contest (regardless of the outcome 
thereof) by the Company, the Executive or others of the validity or 
enforceability of, or liability under, any provision of this Agreement or any 
guarantee of performance thereof (including as a result of any contest by the 
Executive about the amount of any payment pursuant to this Agreement), plus in 
each case interest on any delayed payment at the applicable Federal rate 
provided for in Section 7872(f)(2)(A) of the Internal Revenue Code of 1986, as 
amended (the "Code"); provided that the Company shall have no such obligation 
if it is determined by a court that the Company was not in breach of the 
Agreement and that the Executive's claims were not made in good faith.

      9.   CERTAIN ADDITIONAL PAYMENTS BY THE COMPANY.

      (a)  Anything in this Agreement to the contrary notwithstanding, in the 
event it shall be determined that any payment or distribution by the Company to 
or for the benefit of the Executive (whether paid or payable or distributed or 
distributable pursuant to the terms of this Agreement or otherwise, but 
determined without regard to any additional payments required under this 
Section 9) (a "Payment") would be subject to the excise tax imposed by Section 
4999 of the Code or any interest or penalties are incurred by the Executive 
with respect to such excise tax (such excise tax, together with any such 
interest and penalties, are hereinafter collectively referred to as the "Excise 
Tax"), then the Executive shall be entitled to receive an additional payment (a 
"Gross-Up Payment") in an amount such that after payment by the Executive of 
all taxes and net of any benefits that result from the deductibility by the 
Executive of such taxes (including, in each case, any interest or penalties 
imposed with respect to such taxes), including, without limitation, any income 
taxes (and any interest and penalties imposed with respect thereto) and Excise 
Tax imposed upon the Gross-Up Payment, the Executive retains an amount of the 
Gross-Up Payment equal to the Excise Tax imposed upon the Payments.

      (b)  Subject to the provisions of Section 9(c), all determinations 
required to be made under this Section 9, including whether and when a Gross-Up 
Payment is required and the amount of such Gross-Up Payment and the assumptions 
to be utilized in arriving at such determination, shall be made by KPMG Peat 
Marwick LLP or such other certified public accounting firm as may be designated 
by the Executive (the "Accounting Firm") which shall provide detailed 
supporting calculations both to the Company and the Executive within 15 
business days of the receipt of notice from the Executive that there has been a 
Payment, or such earlier time as is requested by the Company.  In the event 
that the Accounting Firm is serving as  accountant or auditor for the 
individual, entity or group effecting the Change of Control, the Executive 
shall appoint another nationally recognized accounting firm to make the 
determinations required hereunder (which accounting firm shall then be referred 
to as the Accounting Firm hereunder).  All fees and expenses of the Accounting 
Firm shall be borne solely by the Company.  Any Gross-Up Payment, as determined 
pursuant to this Section 9, shall be paid by the Company to the Executive 
within five days of the receipt of the Accounting Firm's determination.  Any 
determination by the Accounting Firm shall be binding upon the Company and the 
Executive.  As a result of the uncertainty in the application of Section 4999 
of the Code at the time of the initial determination by the Accounting Firm 
hereunder, it is possible that Gross-Up Payments which will not have been made 
by the Company should have been made ("Underpayment"), consistent with the 
calculations required to be made hereunder.  In the event that the Company 
exhausts its remedies pursuant to Section 9(c) and the Executive thereafter is 
required to make a payment of any Excise Tax, the Accounting Firm shall 
determine the amount of the Underpayment that has occurred and any such 
Underpayment shall be promptly paid by the Company to or for the benefit of the 
Executive.

      (c)  The Executive shall notify the Company in writing of any claim by 
the Internal Revenue Service that, if successful, would require the payment by 
the Company of the Gross-Up Payment.  Such notification shall be given as soon 
as practicable but no later than ten business days after the Executive is 
informed in writing of such claim and shall apprise the Company of the nature 
of such claim and the date on which such claim is requested to be paid.  The 
Executive shall not pay such claim prior to the expiration of the 30-day period 
following the date on which it gives such notice to the Company (or such 
shorter period ending on the date that any payment of taxes with respect to 
such claim is due).  If the Company notifies the Executive in writing prior to 
the expiration of such period that it desires to contest such claim, the 
Executive shall:

         (i)  give the Company any information reasonably requested by the 
Company relating to such claim,

         (ii)  take such action in connection with contesting such claim as the 
Company shall reasonably request in writing from time to time, including, 
without limitation, accepting legal representation with respect to such claim 
by an attorney reasonably selected by the Company,

         (iii)  cooperate with the Company in good faith in order to 
effectively contest such claim, and

         (iv)  permit the Company to participate in any proceedings relating to 
such claim;

PROVIDED, HOWEVER, that the Company shall bear and pay directly all costs and 
expenses (including additional interest and penalties) incurred in connection 
with such contest and shall indemnify and hold the Executive harmless, on an 
after-tax basis, for any Excise Tax or income tax (including interest and 
penalties with respect thereto) imposed as a result of such representation and 
payment of costs and expenses.  Without limitation on the foregoing provisions 
of this Section 9(c), the Company shall control all proceedings taken in 
connection with such contest and, at its sole option, may pursue or forgo any 
and all administrative appeals, proceedings, hearings and conferences with the 
taxing authority in respect of such claim and may, at its sole option, either 
direct the Executive to pay the tax claimed and sue for a refund or contest the 
claim in any permissible manner, and the Executive agrees to prosecute such 
contest to a determination before any administrative tribunal, in a court of 
initial jurisdiction and in one or more appellate courts, as the Company shall 
determine; provided, however, that if the Company directs the Executive to pay 
such claim and sue for a refund, the Company shall advance the amount of such 
payment to the Executive, on an interest-free basis and shall indemnify and 
hold the Executive harmless, on an after-tax basis, from any Excise Tax or 
income tax (including interest or penalties with respect thereto) imposed with 
respect to such advance or with respect to any imputed income with respect to 
such advance; and further provided that any extension of the statute of 
limitations relating to payment of taxes for the taxable year of the Executive 
with respect to which such contested amount is claimed to be due is limited 
solely to such contested amount.  Furthermore, the Company's control of the 
contest shall be limited to issues with respect to which a Gross-Up Payment 
would be payable hereunder and the Executive shall be entitled to settle or 
contest, as the case may be, any other issue raised by the Internal Revenue 
Service or any other taxing authority.

      (d)  If, after the receipt by the Executive of an amount advanced by the 
Company pursuant to Section 9(a) or 9(c), the Executive becomes entitled to 
receive any refund with respect to such claim, the Executive shall (subject to 
the Company's complying with the requirements of Section 9(c)) promptly pay to 
the Company the amount of such refund (together with any interest paid or 
credited thereon after taxes applicable thereto).  If, after the receipt by the 
Executive of an amount advanced by the Company pursuant to Section 9(c), a 
determination is made that the Executive shall not be entitled to any refund 
with respect to such  claim and the Company does not notify the Executive in 
writing of its intent to contest such denial of refund prior to the expiration 
of 30 days after such determination, then such advance shall be forgiven and 
shall not be required to be repaid and the amount of such advance shall offset, 
to the extent thereof, the amount of Gross-Up Payment required to be paid.

      10.  CONFIDENTIAL INFORMATION.  The Executive shall hold in a fiduciary 
capacity for the benefit of the Company and the Bank all secret or confidential 
information, knowledge or data relating to the Company or the Bank or any of 
their affiliated companies, and their respective businesses, which shall have 
been obtained by the Executive during the Executive's employment by the Company 
and the Bank or any of their affiliated companies and which shall not be or 
become public knowledge (other than by acts by the Executive or representatives 
of the Executive in violation of this Agreement).  After termination of the 
Executive's employment with the Company and the Bank, the Executive shall not, 
without the prior written consent of the Company and the Bank or as may 
otherwise be required by law or legal process, communicate or divulge any such 
information, knowledge or data to anyone other than the Company and the Bank 
and those designated by the Company and the Bank.  In no event shall an 
asserted violation of the provisions of this Section 10 constitute a basis for 
deferring or withholding any amounts otherwise payable to the Executive under 
this Agreement.

      11.  SUCCESSORS.  (a)  This Agreement is personal to the Executive and 
without the prior written consent of the Company shall not be assignable by the 
Executive otherwise than by will or the laws of descent and distribution.  This 
Agreement shall inure to the benefit of and be enforceable by the Executive's 
legal representatives.

      (b)  This Agreement shall inure to the benefit of and be binding upon the 
Company and its successors and assigns.

      (c)  The Company will require any successor (whether direct or indirect, 
by purchase, merger, consolidation or otherwise) to all or substantially all of 
the business and/or assets of the Company to assume expressly and agree to 
perform this Agreement in the same manner and to the same extent that the 
Company would be required to perform it if no such succession had taken place.  
As used in this Agreement, "Company" shall mean the Company as hereinbefore 
defined and any successor to its business and/or assets as aforesaid which 
assumes and agrees to perform this Agreement by operation of law, or otherwise.

       12.  MISCELLANEOUS.  (a)  This Agreement shall be governed by and 
construed in accordance with the laws of the State of New York, without 
reference to principles of conflict of laws.  The captions of this Agreement 
are not part of the provisions hereof and shall have no force or effect.  
This Agreement may not be amended or modified otherwise than by a written 
agreement executed by the parties hereto or their respective successors and 
legal representatives.

      (b)  All notices and other communications hereunder shall be in writing 
and shall be given by hand delivery to the other party or by registered or 
certified mail, return receipt requested, postage prepaid, addressed as follows:


IF TO THE EXECUTIVE:

Mr. Bharat B. Bhatt
15 Christie Hill Road
Darien CT 06820


IF TO THE COMPANY OR THE BANK:

GreenPoint Financial Corp.
41-60 Main Street
Flushing, New York  11355
Attention: Howard C. Bluver
Senior Vice President and General Counsel

or to such other address as either party shall have furnished to the other in 
writing in accordance herewith.  Notice and communications shall be effective 
when actually received by the addressee.

      (c)  The invalidity or unenforceability of any provision of this 
Agreement shall not affect the validity or enforceability of any other 
provision of this Agreement.

      (d)  The Company or the Bank may withhold from any amounts payable under 
this Agreement such Federal, state, local or foreign taxes as shall be required 
to be withheld pursuant to any applicable law or regulation.

      (e)  The Executive's or the Company's or the Bank's failure to insist 
upon strict compliance with any provision hereof or  any other provision of 
this Agreement or the failure to assert any right the Executive or the Company 
or the Bank may have hereunder, including, without limitation, the right of the 
Executive to terminate employment for Good Reason pursuant to Section 
5(d)(i)-(v) of this Agreement, shall not be deemed to be a waiver of such 
provision or right or any other provision or right of this Agreement.

     13.  NO PROHIBITED PAYMENTS.  Notwithstanding anything in this Agreement 
to the contrary, the Company and the Bank shall not make any payment to the 
Executive which, according to the opinion of the Company's outside counsel, 
would violate Section 2523(k) of the Comprehensive Thrift and Bank Fraud 
Prosecution and Taxpayer Recovery Act of 1990 (codified at 12 U.S.C. 1828(k)), 
or any rules or regulations promulgated thereunder.

      IN WITNESS WHEREOF, the Executive has hereunto set the Executive's hand 
and, pursuant to the authorization from their Boards of Directors, the Company 
and the Bank have caused these presents to be executed in their name on their 
behalf, all as of the day and year first above written.

   
   

                                          _____________________________________
                                                       BHARAT B. BHATT



ATTEST:                                   GREENPOINT FINANCIAL CORP.


___________________                       by:  ________________________________
    Secretary                             Thomas S. Johnson
                                          President and Chief Executive Officer
Seal



ATTEST:                                   GREENPOINT BANK


___________________                       By:  ________________________________
    Secretary                             Thomas S. Johnson
                                          President and Chief Executive Officer
Seal

Exhibit 11.1
            Statement Regarding Computation of Per Share Earnings
                   (In millions, except per share amounts )
   
   
                                                             Year Ended
                                                            December 31,
                                                    ---------------------------
                                                      1996      1995    1994(a)
                                                    -------   -------   -------
Net income                                          $ 132.5   $ 107.5   $ 104.7
   
   
Weighted average number of common stock and 
common stock equivalents outstanding during 
each period - primary                                  43.9      47.0      47.3
   
Weighted average number of common stock and 
common stock equivalents outstanding during 
each period - fully diluted                            44.5      47.2      47.2
   
   
Net earnings per share - primary                    $  3.02   $  2.29   $  2.21
   
   
Net earnings per share - fully diluted              $  2.97   $  2.28   $  2.22
   

(a) Amounts are from January 28, 1994, date of initial public offering of 
    common stock.


GREENPOINT FINANCIAL

UNDERWRITING THE AMERICAN DREAM

ANNUAL REPORT 1996


                               FINANCIAL REVIEW
_______________________________________________________________________________

                     TABLE OF CONTENTS
------------------------------------------------------------
Five Year Selected Consolidated Data                      11
Management's Discussion and Analysis of Financial 
  Condition and Results of Operations                     13
Consolidated Financial Statements                         22
Notes to the Consolidated Financial Statements            27
Report of Independent Accountants                         44


10

                SELECTED CONSOLIDATED FINANCIAL CONDITION DATA
_______________________________________________________________________________

<TABLE>
<CAPTION>
                                                             December 31,                       June 30,
                                            --------------------------------------------  -------------------
(In millions)                                    1996        1995       1994       1993       1993       1992
-------------------------------------------------------------------------------------------------------------
<S>                                         <C>         <C>         <C>        <C>        <C>        <C>
Total assets                                $13,325.6   $14,670.5   $6,955.0   $7,377.1   $6,444.7   $5,879.7
Loans receivable held for investment, net     7,294.3     5,858.6    5,594.1    5,376.6    5,200.8    4,870.6
Allowance for possible loan losses              105.0       105.5      103.0      147.0      136.5      130.5
Securities                                    4,359.4     5,900.8      736.7      378.2      481.0      500.3
Money market investments                        494.1     1,550.7      265.0    1,151.8      303.2      181.6
Loans receivable held for sale, net(1)            4.8       175.1       11.1       65.8       74.5       15.3
Goodwill                                        623.6       670.2        0.5        0.7        0.8          -
Other real estate owned, net                     28.6        29.2       54.0       74.8       72.6       46.9
Deposits                                     11,452.3    12,898.3    5,223.5    5,650.4    5,543.3    5,092.9
Stockholders' equity                          1,459.8     1,551.3    1,521.2      786.3      730.0      646.1
</TABLE>

                     SELECTED CONSOLIDATED OPERATING DATA
_______________________________________________________________________________

<TABLE>
<CAPTION>
                                                  For the               For the           For the
                                                Year Ended         Six Months Ended     Year Ended
                                               December 31,           December 31,       June 30,
(In millions)                            1996       1995       1994       1993       1993       1992
-----------------------------------------------------------------------------------------------------
<S>                                   <C>        <C>        <C>        <C>        <C>        <C>
Interest income                        $974.0     $696.5     $563.8     $273.2     $547.6     $548.9
Interest expense                        527.5      345.8      226.3      114.8      244.4      300.9
Provision for possible loan losses      (15.7)      (9.5)     (32.3)     (25.3)     (63.6)     (59.9)
Non-interest income                      56.9       35.8       27.1       16.2       33.0       32.6
Non-interest expense                    263.2      178.6      121.4       51.8       99.7       78.1
Income taxes                             92.0       90.9       98.0       41.2       83.7       69.0
Cumulative effect of change in 
  accounting principles(2)                  -          -          -          -       (5.3)         -
Net income                             $132.5     $107.5     $112.9     $ 56.3     $ 83.9     $ 73.6
</TABLE>

See notes on following page


11



                   SELECTED FINANCIAL RATIOS AND OTHER DATA
_______________________________________________________________________________

<TABLE>
<CAPTION>
                                                        At or For the                Six Months       At or For the
                                                          Year Ended                    Ended           Year Ended
                                                         December 31,                December 31,        June 30,
(Dollars in millions, except per share data)     1996         1995         1994        1993)(3)      1993        1992
-----------------------------------------------------------------------------------------------------------------------
<S>                                          <C.         <C>           <C>           <C>         <C>         <C>
Performance Ratios:
Return on average assets(4)                      0.91%        1.18%        1.59%         1.72%       1.36%       1.29%
Return on average equity(4)                      8.62         6.96         7.91         14.96       12.22       12.08
Return on tangible equity(4)                    14.82         7.93         7.92         14.97       12.23       12.09
Net interest spread during period                3.23         3.36         4.15          4.67        4.61        3.83
Net interest margin                              3.51         4.05         4.92          5.05        5.07        4.47
Operating expense to average assets(5)           1.57         1.76         1.75          1.58        1.62        1.37
Efficiency ratio(6)                              44.3         41.4         34.0          28.7        26.8        25.1
Average interest-earning assets to 
  average interest-bearing liabilities           1.07x        1.17x        1.23x         1.11x       1.11x       1.12x

PER SHARE DATA:
Earnings per share                          $    3.02    $    2.29     $   2.21(7)          -           -           -
Book value per share                            34.77        34.25        32.31             -           -           -
Tangible book value per share                   19.92        19.12        32.30             -           -           -
Dividends per share                              0.80         0.80         0.60(8)          -           -           -
Dividend payout ratio                           26.49%       34.93%       27.15%            -           -           -

ASSET QUALITY RATIOS:
Non-performing loans to total loans              4.78%        6.49%        6.80%        12.02%      11.63%      12.30%
Non-performing assets to total assets            2.89         2.94         6.42         10.21       10.99       11.40
Allowance for possible loan losses to 
  non-performing loans                          29.48        26.24        26.26         23.45       23.70       20.94
Allowance for possible loan losses to 
  total loans                                    1.41         1.75         1.79          2.63        2.52        2.58
Allowance for possible loan losses          $   105.0    $   105.5     $  103.0      $  147.0    $  136.5    $  130.5
Net charge-offs                             $    16.2    $  13.1(9)    $   31.8(10)  $   14.8    $   37.6    $   13.2
Percentage of net loan charge-off 
  experience to average total loans              0.25%        0.22%        0.56%         0.27%       0.71%       0.27%
Ratio of allowance for possible 
  loan losses to net charge-offs                 6.48x        8.05x        3.24x         3.54x       3.63x       9.89x

CAPITAL DATA:
Tangible assets                             $12,725.3    $13,985.1     $6,954.5      $7,376.4    $6,443.9    $5,879.7
Tangible capital                            $   859.5    $   865.9     $1,520.7      $  785.6    $  729.2    $  646.1
Tangible capital ratio                           6.75%        6.19%       21.87%        10.65%      11.32%      10.99%
Total equity to total assets                    10.95        10.57        21.87         10.66       11.33       10.99

OTHER DATA:
Mortgage loan originations                  $ 2,353.0    $ 1,023.5     $1,058.3      $  582.4    $1,079.6    $1,068.7
Full-service consumer bank offices                 76           84           24            24          24          20
Full-time equivalent employees (FTE)            2,135        2,025        1,392         1,411       1,372       1,201
</TABLE>


(1)  Loans held for sale at December 31, 1993 and June 30, 1993 include $52.1 
million and $60.0 million, net of non-performing loans.

(2)  Reflects changes due to the adoption of Statements of Financial Accounting 
Standards No. 106 and 112.

(3)  Income statement ratios for the six months ended December 31, 1993 are 
annualized.

(4)  Excluding the $5.3 million after-tax gain on branch sales for the year 
ended December 31, 1996.

(5)  Operating expense excludes goodwill expense, ORE (income) or expense and 
restructuring (recovery) charge.

(6)  The efficiency ratio is calculated by dividing non-interest expense 
(excluding goodwill expense, ORE (income) or expense and restructuring 
(recovery) charge) by the sum of net interest income and non-interest income, 
excluding the $8.9 million pre-tax gain on branch sales.

(7)  Earnings per share is for the period subsequent to the initial public 
offering on January 28, 1994.

(8)  Dividends for the year ended December 31, 1994 are for three quarters.

(9)  Net charge-off amount excludes a nonrecurring recovery of $6.1 million 
contingency reserve, included in the 1994 bulk loan sale loss amount. 

(10)  Net charge-off amount excludes a nonrecurring loss of $56.1 million 
related to the bulk sale of non-performing loans.


12



                     MANAGEMENT'S DISCUSSION AND ANALYSIS
_______________________________________________________________________________

GREENPOINT FINANCIAL CORP. 

GreenPoint Financial Corp. (the "Company" or "GreenPoint") is the leading 
national lender in no-documentation ("No-Doc") mortgages. Its principal 
subsidiaries are GreenPoint Bank (the "Bank"), a New York State chartered 
savings bank with 76 branches serving customers throughout the greater New York 
City area, and GreenPoint Mortgage Corp. (the "Mortgage Company"), a national 
mortgage banking company headquartered in Charlotte, N.C.

OVERVIEW OF 1996 FINANCIAL RESULTS
During 1996, the Company focused on implementing its strategy to become the 
leader in the national market for specialty home finance products through 
careful expansion and achieving operational and staffing efficiencies. 
Summarized below are several significant financial results of 1996.

 .  The Company had record net income for 1996 of $132.5 million, or $3.02 per 
share, a 23.2% increase over the $107.5 million, or $2.29 per share, earned in 
1995 reflecting a full year's effect in 1996 of two 1995 acquisitions, a 
substantial increase in loan production and the achievement of planned cost 
savings. 

 .  Core cash earnings rose to $188.4 million, or $4.29 per share, in 1996 
compared to $136.4 million, or $2.90 per share, in the prior year. 

 .  Return on average equity rose to 8.62% in 1996 compared to 6.96% in 1995. 
Return on average tangible equity rose to 14.82% from 7.93%.

 .  The Company's ratio of operating expense to average total assets decreased 
to 1.57% for 1996 compared to 1.76% for 1995, reflecting planned cost savings 
achieved during 1996 despite the demands for additional resources associated 
with the national expansion of the Company's mortgage business.

 .  Mortgage loan originations increased by 130% to $2.35 billion for 1996 
compared to $1.02 billion for 1995. The increase reflects greater demand for 
GreenPoint's loan products in New York and New Jersey and the Company's 
successful national expansion which began in mid-1995 with the acquisition of 
the wholesale residential mortgage lending business of 
BarclaysAmerican/Mortgage Corp. ("BAM") by the Bank. The BAM operations are 
centralized in the Mortgage Company. During 1996, the Mortgage Company opened 
loan offices in five cities, introducing its no-doc loan products to Boston, 
Chicago, Miami, Philadelphia and Washington, D.C. Loan originations from 
outside New York accounted for more than 60% of the total for 1996.

 .  Credit quality improved significantly as both non-performing loans and 
non-performing assets decreased by more than 10%. The ratio of non-performing 
loans to total loans fell to 4.78% at December 31, 1996 compared to 6.49% a 
year ago. This reflects the successful initiatives taken during 1996 to 
increase collection and resolution of delinquent loans, as well as loan 
portfolio growth.

 .  The Company repurchased 5.1 million shares of its stock during 1996 at a 
total cost of $169.5 million. GreenPoint continues to maintain a strong capital 
position with a leverage ratio of 6.68%, a Tier 1 risk-based ratio of 15.24% 
and a total risk-based ratio of 16.49% at December 31, 1996.

EFFECT OF 1995 ACQUISITIONS ON COMPARABILITY OF OPERATING RESULTS
Two 1995 acquisitions affect the comparability of 1996, 1995 and 1994 annual 
results. The Bank completed the BAM acquisition on July 7, 1995 and on 
September 22, 1995, purchased the 60 New York consumer banking branches of Home 
Savings of America, FSB ("HSA"). Both transactions were accounted for as 
purchases. Therefore, 1995 annual results include only those related revenues 
and expenses subsequent to the respective acquisition dates.

The substantial increases in the Company's asset, liability and employee bases 
resulting from the acquisitions (and the inclusion of a full year's effect in 
1996) are the primary factors contributing to increases in revenue, expense and 
average balances from year to year.

The HSA acquisition also resulted in a substantial change in the composition of 
the Company's balance sheet that affected certain key performance ratios. In 
return for assuming approximately $8.1 billion of customer deposits from HSA, 
the Company received cash, certificates of deposit and short-term debt 
securities totaling approximately $7.5 billion. The resulting shift in the 
Company's average interest-earning asset mix away from the higher yielding loan 
portfolio caused a reduction in the yield on average interest-earning assets 
and contributed to compression of the interest rate spread.


COMPARISON OF OPERATING RESULTS FOR THE YEARS ENDED DECEMBER 31, 1996 AND 1995

CORE CASH EARNINGS
Management believes that the measurement and reporting of core cash earnings 
provides useful and relevant information about the Company's financial 
performance. Core cash earnings are defined as reported net income excluding 
the branch sale, plus certain non-cash charges. These non-cash expenses, unlike 
all other expenses incurred by the Company, result in net increases in 
GreenPoint's tangible capital and enable the Company to pursue increases in 
shareholder value through growth of earning assets, increases of cash 
dividends, and additional repurchases of the Company's stock.


13



CORE CASH EARNINGS

                                                  For the Year Ended
                                                        December 31,
(In millions, except per share amounts)       1996              1995
--------------------------------------------------------------------
Core net income                             $127.2(a)         $107.5
Add back:
  Goodwill amortization                       46.5(b)           13.8
  Employee stock plans expense                14.7(c)           15.1
Core cash earnings                          $188.4            $136.4
Core cash earnings per share                $ 4.29            $ 2.90


(a)  Net income less $5.3 million after-tax gain on branch sale.

(b)  Goodwill amortization relates to the two 1995 acquisitions. This expense 
will continue through the year 2010.

(c)  Includes ESOP amortization expense of $9.0 million (which includes $0.8 
million of 401(k) saving plan matching contribution expense) and stock plans 
share amortization expense of $5.7 million. ESOP amortization expense is 
scheduled to occur through the year 2018 and will vary from year to year based 
upon changes in the average annual market price of the Company's stock and by 
changes in annual allocations to plan participants. Stock plans share 
amortization expense is scheduled to occur through the year 2000 and will be 
approximately $2.2 million annually.


NET INTEREST INCOME

Net interest income on a taxable equivalent basis increased by $103.0 million, 
or 29.4%, to $453.7 million for 1996 from $350.7 million for 1995. The increase 
reflects the Company's higher level of average net interest-earning assets 
combined with significant improvement in the Company's average cost of funds.

Interest income on mortgages increased by $59.5 million, or 11.2%, to $591.7 
million for 1996 from $532.2 million for 1995 primarily as a result of 
substantially higher loan origination volume and the Company's decision in 
mid-1996 to portfolio new production rather than sell loans in the secondary 
market. As a result, average mortgage loans for 1996 increased by $709.0 
million, or 12.2%, over 1995.

Throughout 1996, the Company pursued an aggressive deposit pricing strategy 
which reduced the average cost of funds by 33 basis points to 4.36% for 1996 
compared to 4.69% for 1995.

The Company's ability during 1996 to utilize the proceeds from maturities of 
lower yielding money market investments and securities to fund both loan 
portfolio growth and planned run-off in certain high cost customer deposits 
resulted in continuous improvement in the interest rate spread and net interest 
margin. GreenPoint's interest rate spread and net interest margin improved to 
3.52% and 3.82%, respectively, by the fourth quarter of 1996 compared to 2.68% 
and 2.96%, respectively, for the fourth quarter of 1995.

PROVISION FOR POSSIBLE LOAN LOSSES
The provision for possible loan losses increased by $6.2 million, or 65.3%, to 
$15.7 million for 1996 from $9.5 million for 1995. The 1995 provision included 
the effect of a $6.1 million recovery of a special contingency reserve relating 
to a 1994 bulk sale of non-performing loans.

NON-INTEREST INCOME
Non-interest income increased by $21.1 million, or 59.0%, to $56.9 million for 
1996 from $35.8 million for 1995. The increase is primarily the result of 
higher fee income generated by the Company's expanded New York consumer banking 
branch network, a $1.5 million increase in securities lending fees and an $8.9 
million gain on the sale of two branches.

NON-INTEREST EXPENSE
Total non-interest expense increased by $84.6 million, or 47.4%, to $263.2 
million for 1996 from $178.6 million for 1995. Total operating expense 
increased by $58.9 million, or 36.8%, to $219.1 million for 1996 from $160.2 
million for 1995.

The inclusion in 1996 of a full year's expense related to the operations of the 
Mortgage Company and the expanded consumer banking branch network was the 
primary factor leading to the increase in non-interest expense.

Other factors that affected non-interest expense were:

 .  Expense of the Company's ESOP and other employee stock plans decreased 
slightly to $14.7 million for 1996 from $15.1 million for 1995. The decrease 
occurred as a result of a change in the Company's ESOP share allocation 
schedule that lengthens the amortization period from fifteen to twenty-five 
years. Without this change, the 1996 cost would have increased to $19.8 million 
primarily as a result of a higher average market price of the Company's stock 
during 1996 compared to 1995.

 .  FDIC deposit insurance premiums decreased by $4.0 million to $5.2 million 
for 1996 from $9.2 million for 1995, due to a reduction in assessment rates and 
the recapitalization of the Savings Association Insurance Fund. The 1995 
deposit insurance premiums expense included a $3.4 million refund from the FDIC 
related to the re-capitalization of the Bank Insurance Fund.

 .  In 1996, the Company recovered $1.6 million of an $8.0 million restructuring 
charge taken in 1995. The recovery reflected lower severance payments than were 
anticipated due to the Company's ability to reassign many of the affected 
employees to other job vacancies created by normal attrition and lower 
write-downs required on sold or closed facilities.

The Company's efficiency ratio was 44.3% for 1996 compared to 41.4% for 1995. 
Although the ratio increased year over year, the Company achieved planned cost 
savings associated with the HSA acquisition and was able to improve the ratio 
steadily from 53.4% in the fourth quarter of 1995 to 42.7% in the fourth 
quarter of 1996, despite the demands for resources required by the expansion of 
the Company's national mortgage business.


14



INCOME TAX EXPENSE
Income tax expense increased by $1.1 million to $92.0 million for 1996 from 
$90.9 million for 1995. The increase arose from a $26.1 million increase in 
pre-tax income, which was partially offset by a 10.6% decrease in the Company's 
effective tax rate to 40.98%, as a result of a series of business initiatives 
implemented by the Company.

FINANCIAL CONDITION
Total assets were $13.3 billion at December 31, 1996 compared to $14.7 billion 
at December 31, 1995. The $1.4 billion decrease resulted from planned deposit 
liability run-off funded by reductions in money market investments and 
securities available for sale.

Loans receivable held for investment, net increased by $1.4 billion to $7.3 
billion at December 31, 1996 as a result of a 130% increase in mortgage loan 
originations in 1996 over 1995 and the Company's decision in 1996 to portfolio 
new loan production rather than sell loans in the secondary market. New loan 
production was funded by reductions in money market investments and securities 
available for sale.

As a result of the increased loan originations and planned deposit run-off 
during 1996, the combined balances of cash and due from banks, money market 
investments and securities available for sale decreased by $2.7 billion to $4.9 
billion at December 31, 1996 from $7.6 billion at December 31, 1995.

NON-PERFORMING ASSETS
Please refer to notes 7 and 8 of "Notes to the Consolidated Financial 
Statements" for information about the Company's non-performing assets.


RISK MANAGEMENT

LIQUIDITY MANAGEMENT
The Company's primary sources of funds are deposits and proceeds from principal 
and interest payments on loans, mortgage-backed securities and other 
securities. While maturities and scheduled amortization of loans and securities 
are a predictable source of funds, deposit flows and mortgage prepayments are 
greatly influenced by general interest rate levels, economic conditions and 
competition.

The Company and the Bank have recently applied for and received both short-term 
and long-term debt ratings from three recognized credit rating firms. These 
ratings will allow the Company and the Bank to access the wholesale debt 
markets, thereby providing the Company with additional flexibility in accessing 
and utilizing the most cost effective and appropriate means for meeting its 
funding needs.

The Company's most liquid assets are cash and cash equivalents, including money 
market investments. The level of these assets is dependent on the Company's 
operating, financing, lending, and investing activities during any given 
period. Cash and cash equivalents, including money market investments, totaled 
$0.6 billion at December 31, 1996 compared to $1.7 billion at December 31, 1995.

The Company had outstanding mortgage loan commitments of $0.5 billion and 
commitments to sell mortgage-backed securities of approximately $0.09 billion 
at December 31, 1996. The Company anticipates that it will have sufficient 
funds available to meet its current loan commitments.

CAPITAL MANAGEMENT
Management closely monitors the capital of the Company and the Bank to ensure 
that adequate levels are maintained at all times to support ongoing needs. 
Management considers various factors in its evaluations including the 
appropriate capital levels needed to support growth through either expansion or 
acquisition and the amount of capital needed to absorb unanticipated risk.

The Company and the Bank are also subject to minimum regulatory capital 
requirements imposed by various Federal and state banking authorities, 
including the Federal Reserve Board, the FDIC and the New York State Banking 
Department. These capital requirements vary according to an institution's 
capital level and the composition of its assets. Furthermore, pursuant to the 
FDIC Improvement Act of 1991 ("FDICIA"), the Federal banking regulators have 
set the minimum capital ratios for a well-capitalized banking institution at 6% 
Tier 1 risk-based capital, 10% total risk-based capital and 5% Tier 1 leverage 
capital. At December 31, 1996, the Company and the Bank exceeded these levels 
and are expected to be in excess of the minimum ratios required of a 
well-capitalized institution in the future.

Following is a table of the components of regulatory capital as defined by the 
banking regulators for risk-based capital and leverage ratio guidelines.

COMPONENTS OF CAPITAL

                                              At December 31,
(In millions)                         1996              1995
-------------------------------------------------------------
Tier 1 Capital:
Common stockholders' equity       $1,587.7          $1,685.1
Unallocated ESOP shares             (119.6)           (124.0)
Unearned stock plans shares           (8.3)             (9.8)
Preferred shares of subsidiary         3.6                --
Less: Goodwill                      (623.6)           (670.2)
  Unrealized loss (gain) on 
  securities available for sale       23.3             (14.9)
Tier 1 Capital                       863.1             866.2

Tier 2 Capital: 
  Qualifying allowance for 
    possible loan losses              69.7              66.1
Tier 2 Capital                        69.7              66.1

Total qualifying capital          $  932.8          $  932.8
Risk-weighted assets              $5,578.3          $5,328.5


15



During 1996, strong cash earnings and liquidity levels enabled the Company to 
complete two stock repurchase programs. The Company purchased a total of 5.1 
million shares at an average cost per share of $33.25. 

Total stockholders' equity decreased by $91.5 million to $1.5 billion at 
December 31, 1996 primarily due to the Company's repurchase of common stock of 
$169.5 million, the declaration of $34.1 million in dividends and a change in 
unrealized loss on securities available for sale of $38.2 million. These 
decreases were partially offset by net income of $132.5 million and $17.8 
million in additional capital arising from ESOP and employee stock plans share 
allocations and stock options exercises.

CREDIT RISK MANAGEMENT
In conducting its lending activities, the Company is exposed to the possibility 
that borrowers may default on their loans. To manage this risk, the Company 
focuses its efforts on the fundamental disciplines-loan underwriting and 
administration.

The Company lends funds primarily based on the borrower's level of equity in 
the property securing the loan. The Company does not originate loans with a 
loan to value ratio in excess of 75%.  Strict appraisal standards are 
maintained, requiring all in house appraisers to be state certified and all 
appraisals are subject to two additional levels of review by higher levels of 
management.

The Company closely monitors trends in delinquent and nonperforming loans 
through cycles in the economy and in the real estate market. The Company works 
to maintain contact with the borrowers and utilizes varied collection 
procedures to obtain repayment. In addition, the Company reviews the trends in 
amount and frequency of loans that were transferred to other real estate owned 
and trends in sales activity of its foreclosed property, including average 
principal loss experienced and the holding period for such properties. 

Management has comprehensive policies for reviewing the adequacy of the 
allowance for loan losses. The policies require the Company to provide for 
estimated future costs and expenses related to problem loans. Management 
believes that the allowance for loan losses is adequate. However, such 
determination is susceptible to the effect of future unanticipated changes in 
general economic and market conditions that may affect the financial 
circumstances of borrowers and/or residential real estate values within the 
Company's lending areas. 

ALLOWANCE FOR POSSIBLE LOAN LOSSES
As outlined in Note 7 to the consolidated financial statements, the allowance 
for possible loan losses remained relatively constant during the year, as the 
provision of $15.7 million approximated charge offs (net of recoveries) of 
$16.2 million for the year.

NON-PERFORMING ASSETS
The tables in Notes 7 and 8 to the consolidated financial statements reflect 
the favorable results of the Company's efforts to convert non-performing assets 
to interest-earning assets as quickly as possible, while minimizing potential 
losses on the conversion. The decrease in non-performing assets of 10.8% 
($384.7 million at December 31, 1996, compared to $431.3 million at December 
31, 1995) results from the proactive approach to managing overall credit risk, 
as well as economic conditions.

INTEREST RATE RISK MANAGEMENT
Interest rate risk is defined as the sensitivity of the Company's current and 
future earnings to changes in the level of market interest rates. It arises in 
the ordinary course of the Company's business, as the repricing characteristics 
of its mortgage loans do not necessarily match those of its deposit 
liabilities. The resulting interest rate risk is managed by careful attention 
to the mix of asset maturities and deposit offerings and by adjustments to the 
Company's investment portfolio and the use of off balance sheet instruments 
such as interest rate swaps and options.

Management responsibility for interest rate risk resides with the Asset and 
Liability Management Committee ("ALCO"). The committee is comprised of the 
Chairman and Chief Executive Officer, the Vice Chairman, the Chief Financial 
Officer, the Treasurer and the Company's senior business-unit and financial 
executives. Interest rate risk management strategies are formulated and 
monitored by ALCO within policies and limits approved by the Board of 
Directors. These policies and limits set forth the maximum risk which the Board 
of Directors deems prudent, govern permissible investment securities and off 
balance sheet instruments and identify acceptable counterparties to securities 
and off balance sheet transactions.

ALCO risk management strategies allow for the assumption of interest rate risk 
within the Board approved limits. The strategies are formulated based upon 
ALCO's assessments of likely economic and financial market developments and 
trends in the Company's mortgage and consumer banking businesses. Strategies 
are developed with the aim of enhancing the Company's net income and capital, 
while ensuring that the risks to income and capital from adverse movements in 
interest rates are acceptable.

The Company's income is affected by changes in the level of market interest 
rates based upon mismatches between the repricing of its assets and 
liabilities. One measure of interest rate sensitivity is provided by the 
accompanying net gap analysis, which organizes assets and liabilities according 
to the time period in which they reprice or mature. For many of the Company's 
assets and liabilities the maturity or repricing date is not determinable with 
certainty. For example, the 


16



Company's mortgage loans and its mortgage-backed securities can be prepaid 
before contractual amortization and/or maturity. Also, the repricing behavior 
of the Company's non-time deposits is subject to the interest rate environment, 
current funding and liquidity needs, and other factors influencing the market 
competition for such deposits. Consequently, ALCO evaluates many different 
interest rate scenarios in arriving at its assessment of the most likely gap 
analysis and repricing schedule. The amounts reflected in the accompanying 
schedule could vary from those detailed in the schedule.

The difference between assets and liabilities repricing in a given period is 
one approximate measure of interest rate sensitivity. More assets than 
liabilities repricing in a period (a positive gap) implies earnings will rise 
as interest rates rise, and decline as interest rates decline. More liabilities 
repricing than assets implies declining income as rates rise. However, these 
relationships do not consider the impact that the rate movements might have on 
other components of the Bank's risk profile; for example, an increase in 
interest rates, while implying that earnings will rise in a positive gap 
period, might also result in higher credit or default risk due to a higher 
probability of borrowers being unable to pay the contractual payments on loans. 
Likewise, a decrease in rates might result in an increase in the risk that 
funds received from loan prepayments cannot be reinvested at rates and spreads 
achieved by management on earlier investments and loan originations.

The use of interest rate instruments such as interest rate swaps is integrated 
into the Company's interest rate risk management. The notional amounts of these 
instruments are not reflected in the Company's balance sheet. However, these 
instruments are included in the interest rate sensitivity table for purposes of 
analyzing interest rate risk. 

As of December 31, 1996, the cumulative volumes of assets and liabilities 
maturing or repricing within one year were approximately equal, implying little 
current-year income sensitivity to movements in the level of interest rates. 
However, the gap report does not represent a precise measure of risk, given the 
uncertainties of the repricing assumptions on indeterminate assets and 
liabilities, and the fact that not all rates move equally at their repricing 
dates.

ALCO supplements the gap report with two other measures of interest rate risk. 
It uses an earning simulation model which gives effect to management 
assumptions concerning the repricing of assets and liabilities, as well as 
business volumes, under a variety of economic and interest rate scenarios. ALCO 
also considers the sensitivity of economic value to changes in interest rates. 
This measure compares the estimated change in the net present value of the 
Company's assets to the change in the net present value of its liabilities for 
various changes in interest rate levels. All three measures of risk are subject 
to limits deemed by the Board of Directors as acceptable.

All of these measures of risk represent the Company's exposure to interest rate 
movements at particular points in time. The risk position is always changing. 
The ALCO continuously monitors the Company's risk profile as it changes, and 
alters the rate sensitivity to ensure limits are adhered to, and that the 
resulting risk profile is appropriate to its views on the course of interest 
rates and developments in its core business.


17



INTEREST RATE SENSITIVITY GAP ANALYSIS

<TABLE>
<CAPTION>
                                                                   At December 31, 1996
----------------------------------------------------------------------------------------------------------------
                                                      More Than    More Than    More Than     More
                                           Within     1 Year to   3 Years to   5 Years to     Than
(Dollars in millions)                     One Year     3 Years      5 Years     10 Years    10 Years      Total
----------------------------------------------------------------------------------------------------------------
<S>                                       <C>         <C>          <C>          <C>         <C>        <C>
Total loans                               $2,835.4    $ 1,291.3    $   986.3    $1,414.1    $  772.0   $ 7,299.1
Money market investments(1)                  494.1            -            -           -           -       494.1
Securities held to maturity                      -            -            -           -         4.0         4.0
Securities available for sale              1,928.1        898.1        732.4       503.8       293.0     4,355.4

  Total interest-earning assets            5,257.6      2,189.4      1,718.7     1,917.9     1,069.0    12,152.6

Cash and due from banks                       81.9            -            -           -           -        81.9
Excess of cost over fair value of net 
  assets acquired                             42.3         84.6         84.6       211.0       201.1       623.6
Other non-earning assets                     467.5            -            -           -           -       467.5

  Total assets                            $5,849.3    $ 2,274.0    $ 1,803.3    $2,128.9    $1,270.1   $13,325.6

Term certificates                         $4,707.2    $ 1,616.6    $   248.8    $   38.8           -   $ 6,611.4
Core deposits                              1,043.4      1,849.9      1,336.1       611.5           -     4,840.9

  Total interest-bearing liabilities       5,750.6      3,466.5      1,584.9       650.3           -    11,452.3

Other liabilities                            409.9            -            -           -           -       409.9
Preferred shares of subsidiary                   -            -            -           -         3.6         3.6
Stockholders' equity                             -            -            -           -     1,459.8     1,459.8

  Total liabilities and equity            $6,160.5    $ 3,466.5    $ 1,584.9    $  650.3    $1,463.4   $13,325.6

Off balance sheet financial instruments      300.0       (300.0)           -           -           -           -

Interest rate sensitivity gap             $  (11.2)   $(1,492.5)   $   218.4    $1,478.6    $ (193.3) 

Cumulative interest rate sensitivity gap  $  (11.2)   $(1,503.7)   $(1,285.3)   $  193.3  

Cumulative interest rate sensitivity 
  gap as a percentage of total assets 
  at December 31, 1996                       (0.08%)     (11.28%)      (9.64%)      1.45%
</TABLE>


(1) Consists of interest-bearing deposits in other banks, federal funds sold 
and securities purchased under agreements to resell.


18



COMPARISON OF OPERATING RESULTS FOR THE YEARS ENDED DECEMBER 31, 1995 AND 1994

GENERAL
Net income for 1995 was $107.5 million compared to $112.9 million for 1994. The 
1995 results included an $8.0 million restructuring charge for employee 
severance benefits costs associated with planned branch consolidations and 
related fixed asset writedowns.

NET INTEREST INCOME
Net interest income on a taxable equivalent basis increased by $13.2 million, 
or 3.9%, to $350.7 million for 1995 from $337.5 million for 1994. The increase 
in 1995 was the result of the Company's higher average interest-earning assets, 
partially offset by higher average interest-bearing liabilities and a higher 
average cost of funds.

PROVISION FOR POSSIBLE LOAN LOSSES
The Company's provision for possible loan losses decreased by $22.8 million, or 
70.6%, to $9.5 million for 1995 from $32.3 million for 1994. The 1994 provision 
includes the effect of a $11.6 million provision related to a 1994 bulk sale of 
non-performing loans.

NON-INTEREST INCOME
Non-interest income increased by $8.7 million, or 32.2%, to $35.8 million for 
1995 from $27.1 million for 1994. The increase was primarily due to additional 
fee income generated by the operations of the Mortgage Company and the 
Company's expanded branch network combined with a $3.3 million recovery of 
previous special provisions for losses on loans sold with recourse and a $1.8 
million increase in net gain on sales of loans.

NON-INTEREST EXPENSE
Non-interest expense increased by $57.2 million, or 47.1%, to $178.6 million 
for 1995 from $121.4 million for 1994. The 1995 amount included the $8.0 
million restructuring charge and a $2.5 million charge to write down a 
receivable from a former transaction processor for the Company. Excluding the 
restructuring charge and the receivable write down, the increase in 1995 was 
attributable to: the additional expenses associated with the operations of the 
Mortgage Company and the branch network; an increase in ESOP and stock plans 
expense of $2.9 million due to a higher average market price of the Company's 
shares and an increase in the number of shares allocated to participants of the 
ESOP; and a $4.0 million facilities management expense related to the Company's 
mainframe computer conversion which was completed during the third quarter of 
1995. Additionally, Federal deposit insurance premiums decreased by $4.2 
million in 1995 due primarily to a $3.4 million refund from the FDIC and a 
decrease in the assessment rate.

INCOME TAX EXPENSE
Income tax expense decreased by $7.1 million, or 7.2%, to $90.9 million for 
1995 from $98.0 million for 1994. The Company's effective rate decreased to 
45.82% for 1995 from 46.47% for 1994.

NON-PERFORMING ASSETS
Non-performing loans increased by $9.9 million, or 2.5%, to $402.1 million at 
December 31, 1995 from $392.2 million at December 31, 1994. Net total other 
real estate owned decreased by $24.8 million, or 45.9%, to $29.2 million at 
December 31, 1995 from $54.0 million at December 31, 1994.


19



AVERAGE CONSOLIDATED BALANCE SHEET, INTEREST AND RATES

<TABLE>
<CAPTION>
(Taxable-Equivalent Interest and Rates; in millions)(1)                        Year Ended December 31,
------------------------------------------------------------------------------------------------------------------------------------
                                                 1996                              1995                            1994
                                   ------------------------------   ------------------------------   -------------------------------
                                                          Average                          Average                           Average
                                                           Yield/                           Yield/                            Yield/
                                    Balance    Interest     Cost     Balance    Interest     Cost     Balance    Interest      Cost
------------------------------------------------------------------------------------------------------------------------------------
<S>                                <C>         <C>       <C>        <C>         <C>       <C>        <C>         <C>        <C>
ASSETS:
  Mortgage loans(2)                $ 6,531.0    $591.7      9.06%   $5,822.0     $532.2      9.14%   $5,702.8     $514.3       9.02%
  Other loans(2)                        31.7       2.6      8.12        26.6        1.9      7.35        19.4        1.4       7.47
  Money market investments(3)(6)     1,261.0      70.0      5.54       742.7       43.8      5.91       439.7       17.0       3.85
  Securities(4)                      5,101.4     316.9      6.22     2,059.9      118.6      5.76       692.4       32.7       4.72
  Total interest-earning assets     12,925.1     981.2      7.59     8,651.2      696.5      8.05     6,854.3      565.4       8.25
Non-interest earning assets(5)       1,031.0                           437.9                            250.7  
  Total assets                     $13,956.1                        $9,089.1                         $7,105.0 

LIABILITIES & STOCKHOLDERS' EQUITY:
  Savings                          $ 1,976.5      55.2      2.79%   $  972.1       28.4      2.93%   $  652.8       20.2       3.09%
  NOW                                  333.9       6.1      1.83       170.9        3.4      1.97       107.6        2.2       2.09
  Money market and variable
    rate savings                     2,541.9      85.6      3.37     1,675.1       55.7      3.33     1,829.4       58.0       3.17
  Term certificates of deposit       7,126.6     377.8      5.30     4,472.4      257.0      5.75     2,841.1      144.6       5.09
  Mortgagors' escrow                    80.9       1.0      1.26        79.6        1.3      1.59        76.4        1.3       1.65
  Repurchase agreements                 47.9       1.8      3.88           -          -         -           -          -          -
  Funds held for stock purchases(6)        -         -         -           -          -         -        55.2        1.6       2.86
  Total interest-bearing
    liabilities                     12,107.7     527.5      4.36     7,370.1      345.8      4.69     5,562.5      227.9       4.10
Other liabilities(7)                   371.5                           173.8                            115.7
  Total liabilities                 12,479.2                         7,543.9                          5,678.2
Preferred shares of subsidiary           0.9                               -                                -
Stockholders' equity                 1,476.0                         1,545.2                          1,426.8
  Total liabilities &
    stockholders' equity           $13,956.1                        $9,089.1                         $7,105.0

Net interest income/interest 
  rate spread(8)                                $453.7      3.23%                $350.7      3.36%                $337.5       4.15%

Net interest-earning assets/net 
  interest margin(9)               $   817.4                3.51%   $1,281.1                 4.05%   $1,291.8                  4.92%

Ratio of interest-earning assets 
  to interest-bearing liabilities                            1.07x                           1.17x                             1.23x
</TABLE>


(1)  The applicable tax rate used to adjust tax-exempt interest to a taxable 
equivalent basis was approximately 44.7% in 1996.

(2)  In computing the average balances and average yield on loans, non-accruing 
loans and loans held for sale have been included.

(3)  Includes interest-bearing deposits in other banks, federal funds sold and 
securities purchased under resale agreements.

(4)  The average yield does not give effect to changes in fair value that are 
reflected as a component of stockholders' equity.

(5)  Includes goodwill, banking premises and equipment-net, net deferred tax 
assets, accrued interest receivable, and other miscellaneous non-interest 
earning assets.

(6)  Interest expense on funds held for stock purchases was reported as a $1.6 
million offset to short-term investment income in 1994.

(7)  Includes accrued interest payable, accounts payable, official checks drawn 
against the bank, accrued expenses, and other miscellaneous non-interest 
bearing obligations of the Company.

(8)  Net interest rate spread represents the difference between the average 
yield on average interest-earning assets and the average cost of 
interest-bearing liabilities.

(9)  Net interest margin represents net interest income divided by average 
interest-earning assets.


20



RATE/VOLUME ANALYSIS

The following table presents the effects of changes in interest rates and 
changes in volume of interest-earning assets and interest-bearing liabilities 
on the Company's interest income and interest expense during the periods 
indicated. The changes attributable to the combined impact of volume and rate 
have been allocated proportionately to volume and rate.

<TABLE>
<CAPTION>
                                           Year Ended December 31, 1996   Year Ended December 31, 1995
                                                     Compared to                  Compared to
                                           Year Ended December 31, 1995   Year Ended December 31, 1994
                                                Increase/(Decrease)            Increase/(Decrease)
                                           ----------------------------  ------------------------------
                                                 Due to                        Due to
-------------------------------------------------------------------------------------------------------
                                           Average    Average     Net    Average    Average      Net
(Dollars in millions)                       Volume      Rate    Change    Volume      Rate     Change
-------------------------------------------------------------------------------------------------------
<S>                                        <C>        <C>       <C>      <C>        <C>       <C>
  Mortgage loans(1)                         $ 64.2    $ (4.7)   $ 59.5    $ 10.9     $ 7.0    $ 17.9
  Other loans(1)                               0.5       0.2       0.7       0.5         -       0.5
  Money market investments(2)                 29.0      (2.8)     26.2      15.1      11.7      26.8(3)
  Securities                                 195.7       2.6     198.3      78.6       7.3      85.9
    Total interest earned on assets          289.4      (4.7)    284.7     105.1      26.0     131.1
  Savings                                     28.2      (1.4)     26.8       9.3      (1.1)      8.2
  NOW                                          2.9      (0.2)      2.7       1.3      (0.1)      1.2
  Money market and other variable 
    rate savings                              29.2       0.7      29.9      (5.0)      2.7      (2.3)
  Term certificates of deposit               142.1     (21.3)    120.8      91.8      20.6     112.4
  Mortgagors' escrow                             -      (0.3)     (0.3)        -         -         -
  Repurchase agreements                        1.8         -       1.8         -         -         -
  Funds held for stock purchases                 -         -         -      (1.6)        -      (1.6)
    Total interest paid on liabilities       204.2     (22.5)    181.7      95.8      22.1     117.9
  Net change in net interest income         $ 85.2    $ 17.8    $103.0    $  9.3     $ 3.9    $ 13.2
</TABLE>


(1)  In computing the volume and rate components of net interest income for 
loans, non-accrual loans and loans held for sale have been included.

(2)  Includes interest-bearing deposits in other banks, federal funds sold and 
securities purchased under resale agreements.

(3)  Includes $1.6 million relating to funds held for stock purchases which, 
for financial reporting purposes, was offset by related interest expense.


21



                CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
_______________________________________________________________________________

                                                                  December 31,
(In millions, except share amounts)                         1996          1995
-------------------------------------------------------------------------------
ASSETS:
Cash and due from banks                                $    81.9     $   153.7
Money market investments:
  Interest-bearing deposits in other banks                 105.6             -
  Federal funds sold and securities purchased under 
    agreements to resell                                   388.5       1,550.7

    Total cash and cash equivalents                        576.0       1,704.4

Loans receivable held for sale                               4.8         175.1
Securities available for sale                            4,355.4       5,896.5
Securities held to maturity 
  (fair value of $4.0 and $4.4, respectively)                4.0           4.3
Loans receivable held for investment (net of 
  allowance for possible loan losses of $105.0 in 
  1996 and $105.5 in 1995)                               7,294.3       5,858.6
Accrued interest receivable, net                            89.5          73.0
Banking premises and equipment, net                        128.2         113.7
Deferred income taxes, net                                  80.2          70.1
Other real estate owned, net                                28.6          29.2
Goodwill                                                   623.6         670.2
Other assets                                               141.0          75.4

    Total assets                                       $13,325.6     $14,670.5

LIABILITIES AND STOCKHOLDERS' EQUITY:
LIABILITIES:
Deposits:
  N.O.W. and checking                                  $   524.2     $   501.8
  Savings and club                                       1,901.7       2,034.7
  Variable rate savings                                  1,853.7       1,995.3
  Money market                                             561.3         635.7
  Term certificates of deposit                           6,611.4       7,730.8

    Total deposits                                      11,452.3      12,898.3

Mortgagors' escrow                                          66.9          58.9
Securities sold under agreements to repurchase              89.5             -
Accrued income taxes payable                                45.1           7.6
Other liabilities                                          208.4         154.4

    Total liabilities                                   11,862.2      13,119.2

Commitments and contingencies
Preferred shares of subsidiary                               3.6             -

STOCKHOLDERS' EQUITY:
  Preferred stock ($0.01 par value; 50,000,000 
    shares authorized; none issued)                            -             -
  Common stock ($0.01 par value; 220,000,000 
    shares authorized; 55,115,582 and 54,965,582 
    shares issued, respectively)                             0.5           0.5
  Additional paid-in capital                               810.2         801.4
  Unallocated Employee Stock Ownership Plan (ESOP)
    shares                                                (119.6)       (124.0)
  Unearned stock plans shares                               (8.3)         (9.8)
  Retained earnings                                      1,038.0         942.1
  Unrealized (loss) gain on securities available 
    for sale, net                                          (23.3)         14.9
  Treasury stock, at cost (7,871,400 shares and 
    2,748,200 shares, respectively)                       (237.7)        (73.8)

    Total stockholders' equity                           1,459.8       1,551.3

    Total liabilities and stockholders' equity         $13,325.6     $14,670.5


See accompanying notes to the consolidated financial statements


22



                      CONSOLIDATED STATEMENTS OF INCOME
_______________________________________________________________________________

                                                For the Year Ended December 31,
                                                -------------------------------
(In millions, except per share amounts)             1996      1995      1994
-------------------------------------------------------------------------------
INTEREST INCOME:
  Mortgages                                       $591.7    $532.2    $514.3
  Money market investments                          68.0      43.8      15.4
  Securities                                       311.7     118.6      32.7
  Other loans                                        2.6       1.9       1.4
    Total interest income                          974.0     696.5     563.8
Interest expense                                   527.5     345.8     226.3
Net interest income                                446.5     350.7     337.5
Provision for possible loan losses                 (15.7)     (9.5)    (32.3)
Net interest income after provision for 
  possible loan losses                             430.8     341.2     305.2

NON-INTEREST INCOME:
  Income from fees and commissions: 
    Mortgage loan operations fee income             14.6      13.8      12.9
    Mortgage servicing fees                          8.3      10.0      10.3
    Banking services fees and commissions           17.4       6.4       2.9
    Other fee income                                 3.9       4.4       1.0
  Net gain (loss) on securities                      0.9      (0.6)        -
  Net gain on sales of loans                         2.9       1.8         -
  Gain on sale of branches                           8.9         -         -

    Total non-interest income                       56.9      35.8      27.1

NON-INTEREST EXPENSE: 
  Salaries and benefits                             86.8      68.6      54.4
  Employee Stock Ownership and stock plans 
    expense                                         14.7      15.1      12.2
  Net expense of premises and equipment             46.6      23.6      16.2
  Federal deposit insurance premiums                 5.2       9.2      13.4
  Other administrative expenses                     65.8      43.7      27.9
  Other real estate owned operating income          (0.8)     (3.4)     (2.9)
  Goodwill amortization                             46.5      13.8       0.2
  Restructuring (recovery) charge                   (1.6)      8.0         -

    Total non-interest expense                     263.2     178.6     121.4

Income before income taxes                         224.5     198.4     210.9
Income taxes                                        92.0      90.9      98.0
Net income                                        $132.5    $107.5    $112.9
Earnings per share                                $ 3.02    $ 2.29    $ 2.21(a)


(a)  Amount is from January 28, 1994 through December 31, 1994, the period 
subsequent to the Company's initial public offering.

     See accompanying notes to the consolidated financial statements.


23



          CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
_______________________________________________________________________________

                                                For the Year Ended December 31,
                                                -------------------------------
(In millions)                                       1996       1995       1994
-------------------------------------------------------------------------------
COMMON STOCK
Balance at beginning of period                  $    0.5   $    0.5     $    -
Issuance of stock in initial public offering           -          -        0.5
Balance at end of period                             0.5        0.5        0.5

ADDITIONAL PAID-IN CAPITAL
Balance at beginning of period                     801.4      794.6          -
Issuance of stock in initial public offering,
  net of issuance costs                                -          -      774.2
Issuance of common stock to stock plans              3.7          -       18.6
Amortization of ESOP shares committed to be
  released                                           4.5        3.5        1.7
Amortization of stock plans shares during
  the period                                         0.6        0.1        0.1
Tax benefit for vested stock plans shares              -        0.9          -
Exercise of stock options                              -        1.1          -
Adjustment to initial public offering 
  issuance costs                                       -        1.2          -
Balance at end of period                           810.2      801.4      794.6

UNALLOCATED ESOP SHARES
Balance at beginning of period                    (124.0)    (131.0)         -
Issuance of stock in initial public offering           -          -      (80.4)
Open market purchases of common stock by
  ESOP trustee                                         -          -      (56.7)
Amortization of ESOP shares committed to be 
  released                                           4.4        7.0        6.1
Balance at end of period                          (119.6)    (124.0)    (131.0)

UNEARNED STOCK PLANS SHARES
Balance at beginning of period                      (9.8)     (14.3)         -
Issuance of common stock to stock plans             (3.7)         -      (18.6)
Amortization of stock plans shares during
  the period                                         5.2        4.5        4.3
Balance at end of period                            (8.3)      (9.8)     (14.3)

RETAINED EARNINGS
Balance at beginning of period                     942.1      871.4      786.3
Net income for the period                          132.5      107.5      112.9
Dividends paid                                     (34.1)     (36.8)     (27.8)
Exercise of stock options                           (2.5)         -          -
Balance at end of period                         1,038.0      942.1      871.4

NET UNREALIZED (LOSS) GAIN ON SECURITIES 
  AVAILABLE FOR SALE, NET OF TAX
Balance at beginning of period                      14.9          -          -
Net change in unrealized (loss) gain on 
  securities available for sale                    (38.2)      14.9          -
Balance at end of period                           (23.3)      14.9          -

TREASURY STOCK
Balance at beginning of period                     (73.8)         -          -
Exercise of stock options                            5.6          -          -
Purchase of treasury stock                        (169.5)     (73.8)         -
Balance at end of period                          (237.7)     (73.8)         -

TOTAL STOCKHOLDERS' EQUITY                      $1,459.8   $1,551.3   $1,521.2


See accompanying notes to the consolidated financial statements


24



                    CONSOLIDATED STATEMENTS OF CASH FLOWS 
_______________________________________________________________________________

                                                For the Year Ended December 31,
                                               --------------------------------
(In millions)                                       1996        1995      1994
-------------------------------------------------------------------------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income                                      $  132.5   $   107.5   $ 112.9
Adjustments to reconcile net income to net 
  cash provided by (used in) operating 
  activities:
  Provision for possible loan losses                15.7         9.5      32.3
  Depreciation and amortization of premises 
    and equipment                                   16.1        10.3       9.9
  Goodwill amortization                             46.5        13.8       0.2
  Accretion of discount on securities, net of
    premium amortization                           (71.0)      (71.6)     (9.2)
  ESOP and stock plans expense                      14.7        15.1      12.2
  Net change in loans held for sale                170.3      (286.3)     27.9
  Net gain on sales of other real estate owned      (6.6)       (9.9)    (11.2)
  Deferred income taxes                             21.5        39.4      46.4
  Decrease (increase) in other assets               25.5         3.5      20.0
  Increase (decrease) in other liabilities          50.1       (17.8)      0.7
  Other, net                                        21.4       (18.7)    (67.6)

    Net cash provided by (used in) operating 
      activities                                   436.7      (205.2)    174.5

CASH FLOWS FROM INVESTING ACTIVITIES:
  Loan originations, net of principal 
    repayments                                  (1,447.4)       10.7    (381.7)
  Purchase of mortgage loans held for 
    investment, net                                    -      (119.6)        -
  Proceeds from sales of non-performing 
    loans held for sale, net                           -           -     198.4
  Proceeds from sales of other real estate 
    owned                                           12.0        25.1      33.2
  Repurchases of mortgage loans sold with 
    recourse                                           -       (14.3)    (26.7)
  Purchases of securities available for sale    (6,363.9)   (2,637.3)        -
  Purchases of securities held to maturity          (1.1)       (1.3)   (784.5)
  Proceeds from maturities of securities 
    available for sale                           4,398.5     3,849.8         -
  Proceeds from maturities of securities 
    held to maturity                                   -       609.0     426.1
  Proceeds from sales of securities 
    available for sale                           3,233.8           -         -
  Principal repayments on securities               263.2         4.4       9.2
  Purchases of premises and equipment              (30.6)      (16.2)     (4.5)
  Net cash and cash equivalents received in 
    acquisitions                                       -       454.0         -

    Net cash provided by (used in) investing 
      activities                                    64.5     2,164.3    (530.5)


Statements continued on following page. 
See accompanying notes to the consolidated financial statements.


25



                    CONSOLIDATED STATEMENTS OF CASH FLOWS 
_______________________________________________________________________________

                                                For the Year Ended December 31,
                                               --------------------------------
(In millions)                                      1996        1995       1994
-------------------------------------------------------------------------------
CASH FLOWS FROM FINANCING ACTIVITIES:
  Net withdrawals from depositors' accounts    (1,293.3)     (440.1)    (426.9)
  Cash paid on transfer of deposit liabilities   (143.8)          -          -
  Funds received from depositors for the 
    purchase of GreenPoint Financial Corp. 
    common stock                                      -           -      133.6
  Funds returned for over-subscriptions of 
    common stock                                      -           -     (153.7)
  Funds loaned to ESOP trustee for the 
    purchase of additional ESOP shares                -           -      (56.7)
  Cash paid for initial public offering 
    related expenses                                  -           -      (26.3)
  Payments for cash dividends                     (34.1)      (36.8)     (27.8)
  Purchase of treasury stock                     (169.5)      (73.8)         -
  Other, net                                       11.1         2.7       14.7

    Net cash used in financing activities      (1,629.6)     (548.0)    (543.1)

Net (decrease) increase in cash and cash 
  equivalents                                  (1,128.4)    1,411.1    (899.1)
Cash and cash equivalents at beginning of 
  period                                        1,704.4       293.3    1,192.4
Cash and cash equivalents at end of period    $   576.0    $1,704.4   $  293.3

Non-cash activities:
  Non-performing mortgage loans transferred 
    to held for sale, net                     $       -    $      -   $  150.6
  Additions to other real estate owned, net   $    28.6    $   22.6   $   75.6
  Loans to facilitate sales of other real
    estate                                    $    22.5    $   29.7   $   51.6
  Unsettled trades                            $    89.5    $      -   $      -

SUPPLEMENTAL DISCLOSURE OF CASH FLOW 
  INFORMATION:
Cash paid for income taxes                    $    26.9    $   35.6   $   84.5
Interest paid                                 $   521.7    $  336.7   $  225.0


In addition to the non-cash investing and financing activities previously 
stated, during the year ended December 31, 1995, GreenPoint Bank purchased 
selected assets and assumed selected liabilities of BarclaysAmerican/Mortgage 
Corp. ("BAM") for $7.1 million, and also acquired approximately $8.1 billion of 
deposits and 60 New York branches of Home Savings of America, FSB.

Fair value of assets acquired, including cash and cash 
  equivalents                                                 $7,462.4
Excess of cost over fair value of net assets acquired            685.0
Cash paid                                                         (7.1)
Liabilities assumed, principally deposits                     $8,140.3


See accompanying notes to the consolidated financial statements.


26



                NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
_______________________________________________________________________________

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

GreenPoint Financial Corp. (the "Company") is a bank holding company organized 
in 1993 under the laws of the state of Delaware and registered under the Bank 
Holding Company Act of 1956, as amended. The Company acquired 100% of the 
outstanding capital stock of GreenPoint Bank (the "Bank"), a New York State 
chartered savings bank, upon its conversion from the mutual to the capital 
stock form of ownership on January 28, 1994. The Company, through the Bank and 
its primary subsidiary, GreenPoint Mortgage Corp. ("GPMC"), is engaged in 
specialty limited documentation mortgage lending nationally and consumer 
banking in the New York City metropolitan area.

(a)  BASIS OF PRESENTATION

The consolidated financial statements include the accounts of the Company, the 
Bank and its wholly-owned subsidiaries. All significant intercompany accounts 
and transactions have been eliminated in consolidation. When necessary, certain 
reclassifications of prior year financial statement amounts have been made to 
conform to the current year presentation.

(b)  SECURITIES PURCHASED UNDER AGREEMENTS TO RESELL AND SECURITIES SOLD UNDER 
AGREEMENTS TO REPURCHASE

The Company enters into short-term purchases of securities under agreements to 
resell ("reverse repurchase agreements") and sales of securities under 
agreements to repurchase ("repurchase agreements") of substantially identical 
securities. The amounts advanced under reverse repurchase agreements and the 
amounts borrowed under repurchase agreements are carried on the balance sheet 
at the amount advanced or borrowed, respectively, plus accrued interest. 
Interest earned on reverse repurchase agreements and interest incurred on 
repurchase agreements are reported as interest income and interest expense, 
respectively. 

(c)  SECURITIES HELD TO MATURITY AND SECURITIES AVAILABLE FOR SALE

Securities classified as held to maturity are carried at amortized cost. The 
Company has the positive intent and ability to hold these securities to 
maturity.

Securities that may be sold in response to or in anticipation of changes in 
interest rates and resulting prepayment risk, or other factors, are classified 
as available for sale and are carried at fair value. Unrealized gains and 
losses on these securities are reported, net of applicable taxes, as a separate 
component of stockholders' equity.

Amortization of premiums and accretion of discounts are reported in interest 
income, using a method which results in a level yield over the projected 
holding period of the security.

Gains and losses on the sale of securities are determined using the specific 
identification method.

(d)  LOANS RECEIVABLE HELD FOR INVESTMENT

Loans receivable held for investment are stated at the aggregate of their 
remaining unpaid principal balances, less any related charge-offs, net deferred 
loan fees, unearned discount and allowance for possible loan losses.

Interest income on loans receivable is recognized on an accrual basis except 
when a loan has been past due 90 days or upon determination that collection is 
doubtful, when a loan is placed on non-accrual status and all accrued but 
unpaid interest receivable is reversed and charged against current interest 
income. Thereafter, interest income on non-accrual loans is recorded only when 
received in cash. A loan is returned to accrual status when the principal and 
interest are no longer past due and the borrower's ability to make periodic 
principal and interest payments is reasonably assured.

Loan fees and certain direct loan origination costs are deferred. Net deferred 
fees are amortized into interest income over the contractual life of the loan 
using the level-yield method.

(e)  ALLOWANCE FOR POSSIBLE LOAN LOSSES

Management's periodic evaluation of the adequacy of the allowance for possible 
loan losses is based on the Company's past loan loss experience, known and 
inherent risks in the loan portfolio, adverse situations which may affect the 
borrowers' ability to repay, the estimated value of the underlying real estate 
collateral and current economic and market conditions within the geographic 
areas surrounding underlying real estate.

The allowance for possible loan losses is increased by provisions for possible 
loan losses charged to income and is reduced by charge-offs, net of recoveries.

(f)  LOANS RECEIVABLE HELD FOR SALE

Loans receivable held for sale are carried at the lower of cost or estimated 
market value in the aggregate. Net unrealized losses are provided for in a 
valuation allowance created through charges to income. Transfers from loans 
held for investment to loans held for sale are recorded at the lower of cost or 
estimated market value in the aggregate.

(g)  GOODWILL 

Goodwill arising from the 1995 acquisition of the New York branches of Home 
Savings of America is being amortized over 15 years. The goodwill associated 
with the 1995 BarclaysAmerican/Mortgage acquisition is being amortized over 5 
years. These intangible assets are evaluated by management on a periodic basis.


27



(h)  OTHER REAL ESTATE OWNED

Other real estate owned ("ORE") consists of real estate acquired through 
foreclosure or deed in lieu of foreclosure. ORE is recorded at the lower of 
cost or estimated fair value less estimated selling costs at the time of 
foreclosure. Valuation write downs made at or shortly after the acquisition 
date are charged against the Company's allowance for possible loan losses.

Subsequent declines in the estimated fair value, net operating results, and 
gains and losses on the disposition of the related properties are charged 
against the Company's operating results as incurred.

(i)  DERIVATIVE FINANCIAL INSTRUMENTS

The Company has limited involvement in derivative financial instruments, using 
interest-rate swaps to manage interest rate exposure associated with its fixed 
rate mortgage loan portfolio. These instruments are considered derivative 
financial instruments held for purposes other than trading and are accounted 
for under the accrual method. Interest income (expense) resulting from the 
derivatives is accrued and reported as an adjustment to mortgage loan interest 
income. 

Realized gains and losses from the settlement or termination of derivatives 
contracts are deferred on the balance sheet and are amortized to interest 
income or interest expense over the appropriate risk management periods. 
Amortization commences when the contract is settled or terminated. If the 
related assets or liabilities are sold or otherwise disposed, then the deferred 
gain or loss on the derivative contract is recognized as an adjustment to the 
gain or loss on disposition of the related assets or liabilities.

(j)  BANKING PREMISES AND EQUIPMENT

Buildings, equipment, improvements and furniture and fixtures are carried at 
cost, less accumulated depreciation and amortization. Buildings, equipment and 
furniture and fixtures are depreciated over their estimated useful lives using 
the straight-line method. Leasehold improvements are amortized using the 
straight-line method over the shorter of their estimated useful lives or the 
terms of related leases.

(k)  STOCK-BASED COMPENSATION PLANS

Deferred compensation for stock award plans is recorded as a reduction of 
stockholders' equity and is calculated as the cost of the shares purchased by 
the Bank and contributed to the plan. Compensation expense is recognized over 
the vesting period of actual stock awards based upon the fair value of shares 
at the award date. 

Compensation expense for the Employee Stock Ownership Plan and Trust ("ESOP") 
is recognized for the number of shares allocated to ESOP participants as they 
are committed to be released. The difference between the fair value of the 
shares allocated and the cost of the shares to the ESOP is charged or credited 
to additional paid-in capital.

Effective January 1, 1996, the Company adopted Statement of Financial 
Accounting Standards No. 123, "Accounting for Stock-Based Compensation" ("SFAS 
No. 123"). SFAS No. 123 permits either the recognition of compensation cost for 
the estimated fair value of employee stock-based compensation arrangements on 
the date of grant, or the disclosure in the notes to the financial statements 
of the pro forma effects on net income and earnings per share, determined as if 
the fair value-based method had been applied in measuring compensation cost. 
The Company has adopted the disclosure option and continues to apply APB 
Opinion No. 25, "Accounting for Stock Issued to Employees" ("APB 25") in 
accounting for its plans. Accordingly, no compensation cost has been recognized 
for the Company's  stock option plans.

(l)  INCOME TAXES

The Company and certain of its subsidiaries file consolidated tax returns with 
the Federal, state and local taxing authorities. Other subsidiaries file 
separate domestic tax returns as required.

Deferred tax assets and liabilities are recognized for the future tax 
consequences attributable to the differences between the financial statement 
carrying amounts of existing assets and liabilities and their respective tax 
bases ("temporary differences"). Deferred tax assets and liabilities are 
measured using enacted tax rates expected to apply to taxable income in the 
years in which temporary differences are expected to be recovered or settled. A 
valuation allowance is provided for deferred tax assets where realization is 
not considered "more likely than not". The effect of changes in tax laws or 
rates on deferred tax assets and liabilities is recognized in the period that 
includes the enactment date.

(m)  EARNINGS PER SHARE

Earnings per common and common equivalent share are calculated by dividing net 
income by the weighted average number of shares of common stock and common 
stock equivalents considered outstanding. Stock options are regarded as common 
stock equivalents, and therefore are considered in earnings per share 
calculations if dilutive. Common stock equivalents are computed using the 
treasury stock method. ESOP shares that have been allocated to participants' 
accounts or are committed to be released for allocation are considered 
outstanding for earnings per share calculations.

(n)  IMPACT OF RECENT ACCOUNTING PRONOUNCEMENTS

In June 1996, Statement of Financial Accounting Standards No. 125, "Accounting 
for Transfers and Servicing of Financial Assets and Extinguishments of 
Liabilities" ("SFAS No. 125") was issued. The statement is effective for 
transfers and servicing of financial assets and extinguishments of liabilities 
occurring after December 31, 1996, (or for certain types of transactions 
occuring after December 31, 1997) and shall be applied prospectively. The 
Company does not expect SFAS No. 125 to have a significant effect on its 
financial statements.


28



(o)  STATEMENT OF CASH FLOWS 

For the purpose of reporting cash flows, cash and cash equivalents include cash 
and due from banks, interest-bearing deposits in other banks, federal funds 
sold and reverse repurchase agreements, all of which have initial maturities of 
less than ninety days.


2.  CONVERSION TO STOCK FORM OF OWNERSHIP AND INITIAL PUBLIC OFFERING

On January 28, 1994, the Company completed the issuance and sale of 53,650,000 
shares of its common stock (the "Transaction"), at a price of $15.00 per share, 
through an initial public offering ("IPO"). From the Transaction, the Company 
received gross proceeds of $804.8 million, which included $133.6 million of 
Bank depositor balance withdrawals that were converted into IPO purchases of 
the Company's common stock. 

In accordance with the requirements of the New York State Banking Law, the Bank 
established a liquidation account in the amount equal to its capital as of the 
date of the latest consolidated statement of condition appearing in the final 
IPO prospectus. The liquidation account is maintained for the benefit of 
eligible pre-conversion depositors who continue to maintain their accounts at 
the Bank after the Transaction. The liquidation account is reduced annually to 
the extent that such depositors have reduced their qualifying deposits as of 
each subsequent audited balance sheet date. Subsequent increases in their 
balances will not restore such depositors' interest in the liquidation account. 
In the event of a liquidation of the Bank (a circumstance not envisioned or 
expected by management) such depositors would be entitled, under New York State 
law, to receive a distribution from the liquidation account in an amount 
proportionate to their then current adjusted qualifying account balances for 
all such depositors then holding qualifying deposits in the Bank. The balance 
of the liquidation account at December 31, 1996 was $135.4 million.

In addition to the restrictions described above, the Bank may not declare or 
pay cash dividends on or repurchase any of its shares of common stock if the 
effect thereof would cause stockholders' equity to be reduced below then 
applicable capital maintenance requirements or if such declaration and payment 
would otherwise violate either regulatory requirements and/or applicable 
banking laws, or would reduce the Bank's capital level below the then aggregate 
balance required for the liquidation account.


3.  BUSINESS ACQUISITIONS

On July 7, 1995, the Company paid approximately $7.1 million to acquire the 
national wholesale residential mortgage lending operation of 
BarclaysAmerican/Mortgage Corporation, a subsidiary of Barclays Bank PLC. The 
transaction was structured as a purchase of certain assets and an assumption of 
certain liabilities which generated goodwill of approximately $5.0 million.

On September 22, 1995, the Bank completed the acquisition of the New York 
branch system of Home Savings of America, FSB ("HSA"), a subsidiary of H.F. 
Ahmanson & Company. The Bank assumed approximately $8.1 billion of customer 
deposit liabilities and received approximately $7.5 billion in cash, 
certificates of deposit and short-term Federal agency debt securities. The 
acquisition was structured as a purchase of assets and assumption of 
liabilities which generated goodwill of approximately $680.0 million. 


4.  RESTRICTIONS ON CASH AND DUE FROM BANKS

The Company is required to maintain reserves on deposit with the Federal 
Reserve Bank of New York. The amount of required reserves at December 31, 1996 
was $34.1 million. The average amount of those reserve deposits was 
approximately $40.5 million for the year ended December 31, 1996.


5.  SECURITIES PURCHASED UNDER AGREEMENTS TO RESELL

The maximum amounts of reverse repurchase agreements outstanding on any day 
during the years ended December 31, 1996 and 1995, were $1.42 billion and 
$999.2 million, respectively. The average amounts of these agreements 
outstanding during the years ended December 31, 1996 and 1995, were $791.6 
million and $540.4 million, respectively.


29



6.  SECURITIES 

SECURITIES AVAILABLE FOR SALE

The amortized cost and estimated fair value of securities available for sale at 
December 31, 1996 and 1995 are summarized as follows:

                                                   Gross      Gross
                                     Amortized  Unrealized  Unrealized   Fair
(In millions)                            Cost      Gains      Losses     Value
-------------------------------------------------------------------------------
Securities Available for Sale                   December 31, 1996
-------------------------------------------------------------------------------
U.S. Government and Federal Agency 
  Obligations:
  U.S. Treasury Notes/Bills           $1,944.3    $  0.3     $(16.2)   $1,928.4
  Agency Discount Notes/Asset
    Backed Securities                     66.4         -          -        66.4
  Mortgage-Backed Securities           1,881.0         -      (23.1)    1,857.9
Collateralized Mortgage Obligations       32.4         -          -        32.4
Trust Certificates Collateralized
  by GNMA Securities                     409.8         -       (3.3)      406.5
Other                                     63.9       0.2       (0.3)       63.8

    Total securities available for 
      sale                            $4,397.8    $  0.5     $(42.9)   $4,355.4


                                                   Gross      Gross
                                     Amortized  Unrealized  Unrealized   Fair
(In millions)                            Cost      Gains      Losses     Value
-------------------------------------------------------------------------------
Securities Available for Sale                   December 31, 1995
-------------------------------------------------------------------------------
U.S. Government and Federal Agency 
  Obligations:
  U.S. Treasury Notes/Bills           $1,352.3     $ 4.0     $    -    $1,356.3
  Agency Discount Notes                2,417.0       0.1       (0.1)    2,417.0
  Mortgage-Backed Securities           1,668.8      25.0          -     1,693.8
Trust Certificates Collateralized 
  by GNMA Securities                     430.3       0.3       (1.8)      428.8
Other                                      0.6         -          -         0.6

    Total securities available 
      for sale                        $5,869.0     $29.4     $ (1.9)   $5,896.5


In December 1995, in accordance with guidance issued by the Financial 
Accounting Standards Board, the Company reclassified $105.1 million in 
securities from the held to maturity category to the available for sale 
category. The securities were adjusted to market value, resulting in net 
unrealized gains of approximately $1.7 million.

During the year ended December 31, 1996, the Company sold available for sale 
securities aggregating $3.2 billion, resulting in gross realized gains of $2.7 
million and gross realized losses of $2.1 million. There were no sales of 
securities during the years ended December 31, 1995 and 1994.

Mortgage-backed securities, almost all of which have contractual maturities of 
more than 10 years, are subject to scheduled and nonscheduled principal 
payments which shorten the average life to an estimated 5.7 years. The 
amortized cost and estimated fair value of securities at December 31, 1996 by 
contractual maturity are summarized below:


                                        Securities Available    Securities Held
                                              for Sale            to Maturity
                                        --------------------   ----------------
                                        Amortized      Fair    Amortized   Fair
(In millions)                              Cost       Value       Cost    Value
-------------------------------------------------------------------------------
Maturity schedule of securities                     December 31, 1996
-------------------------------------------------------------------------------
Due in one year or less                 $1,143.1    $1,142.7      $  -     $  -
Due after one year through five years    1,008.2       990.3       2.2      2.2
Due after five years through ten years     674.9       670.2         -        -
Due after ten years                      1,571.6     1,552.2       1.8      1.8

  Total securities                      $4,397.8    $4,355.4      $4.0     $4.0


The Company lends portions of its investment in U.S. government and agency 
securities to pre-authorized securities dealers in return for a securities 
lending fee. These loaned securities are collateralized at 102% of their fair 
value with government and/or agency securities. To protect the Company's 
investment, the agreements contain provisions to increase the collateral 
obtained, should the value of the collateral decline or the fair value of the 
securities loaned increase. Upon maturity or early termination of a loan, the 
Company's securities are returned. At December 31, 1996, $1.9 billion of the 
Company's securities were on loan to securities dealers. Income earned on 
loaned securities, included in other income, for the years ended December 31, 
1996, 1995 and 1994 was $2.0 million, $0.5 million, and $0.6 million, 
respectively. The maximum amount of securities loaned on any day during the 
years ended December 31, 1996 and 1995 was $2.3 billion and $1.8 billion, 
respectively.


30



7.  LOANS RECEIVABLE

The Company's loans receivable balances are summarized as follows:

                                                                  December 31,
(In millions)                                                1996        1995
-------------------------------------------------------------------------------
Conventional first mortgage loans:
  Residential one- to four-family                        $6,350.4    $5,081.3
  Residential multi-family                                  544.1       474.2
  Commercial property                                       467.1       375.7
Second mortgage and home equity loans                        44.1        37.9
Other                                                        41.8        53.3
Total loans receivable held for investment                7,447.5     6,022.4
Deferred loan origination fees and unearned discount        (48.2)      (58.3)
Allowance for possible loan losses                         (105.0)     (105.5)
Loans receivable held for investment, net                $7,294.3    $5,858.6


NON-ACCRUAL LOANS

The outstanding balances of non-accrual loans as of December 31, 1996 and 1995 
are as follows:

                                              December 31,
(In millions)                             1996        1995
----------------------------------------------------------
Mortgage loans secured by:
  Residential one- to four-family       $271.2      $291.6
  Residential multi-family                48.3        61.6
  Commercial property                     36.5        48.9
Other loans                                0.1           -
Total                                   $356.1      $402.1


The effect of non-accrual loans on interest income is as follows:

                                        Year ended December 31,
(In millions)                         1996      1995      1994
---------------------------------------------------------------
Interest Income
  As originally contracted          $ 45.1    $ 50.8    $ 72.3
  As recognized                      (22.9)    (33.7)    (40.3)
  Reduction of interest income      $ 22.2    $ 17.1    $ 32.0


ALLOWANCE FOR POSSIBLE LOAN LOSSES

Activity in the allowance for possible loan losses is summarized as follows:

                            At or for the Year Ended December 31,
(In millions)                      1996       1995          1994
--------------------------------------------------------------------
Balance beginning of period      $105.5     $103.0        $147.0
Provisions charged to income       15.7        9.5          32.3
Transfer from allowance for 
  loans held for sale                 -          -          11.6(a)
Charge offs                       (17.5)     (15.5)        (93.1)(b)
Recoveries                          1.3        8.5(c)        5.2
Balance end of period            $105.0     $105.5        $103.0


(a)Represents the remaining allowance related to non-performing loans held for 
sale that was restored to the overall allowance for possible loan losses.

(b)Includes $56.1 million incurred in a bulk sale of non-performing loans.

(c) Includes a $6.1 million recovery of 1994's bulk sale charge off.


GEOGRAPHIC CONCENTRATION

As of December 31, 1996, 60% of the Company's mortgage loan portfolio is 
secured by properties located in New York and New Jersey. The properties 
securing the remaining portfolio are dispersed throughout the country, with no 
state representing more than 10%.


8. OTHER REAL ESTATE OWNED

The following is a summary of ORE owned by the Company:

                                                   December 31,
(In millions)                                   1996      1995
---------------------------------------------------------------
Property type:
Residential one- to four-family                $17.5     $14.9
Residential multi-family                         4.0       5.4
Commercial                                       8.4      11.1
Allowance for potential declines in value       (1.3)     (2.2)

  Other real estate owned, net                 $28.6     $29.2


Activity in the allowance for potential declines in value for ORE is summarized 
as follows:

                                        At or for the Year Ended December 31,
(In millions)                                   1996        1995        1994
-----------------------------------------------------------------------------
Balance beginning of period                    $ 2.2       $ 5.1       $14.4
Provisions (recoveries) charged to income        0.9         0.5        (1.0)
Charge offs                                     (1.8)       (3.4)       (8.3)
Balance end of period                          $ 1.3       $ 2.2       $ 5.1


31



The following is a summary of ORE income activity:

                                                      Year Ended December 31,
                                                     -------------------------
(In millions)                                         1996     1995      1994
------------------------------------------------------------------------------
Operating expense, net of rental and other income    $ 4.9    $ 6.0    $  9.3
Provision for (recovery of) potential decline in 
  value of ORE                                         0.9      0.5      (1.0)
Net gain on sales of ORE properties                   (6.6)    (9.9)    (11.2)
Net ORE operating income                             $(0.8)   $(3.4)   $ (2.9)


During the years ended December 31, 1996, 1995 and 1994, the Company acquired 
through foreclosure or deed in lieu of foreclosure, loans with book values of 
$33.1 million, $27.2 million and $74.8 million, respectively. Charges to the 
allowance for possible loan losses, reducing the carrying value of ORE 
properties to their estimated fair values, amounted to $4.5 million, $5.5 
million and $15.4 million during the years ended December 31, 1996, 1995 and 
1994, respectively. Sales of ORE properties during these respective periods 
totaled $29.3 million, $46.5 million and $80.2 million. 


9. DEPOSITS

The contractual maturities of term certificates of deposit are summarized as 
follows:

                                                      December 31, 
                                  ---------------------------------------------
                                           1996                   1995
                                  ---------------------  ----------------------
                                             Percentage              Percentage
                                               of Term                  of Term
(In millions)                       Amount    Deposits      Amount     Deposits
-------------------------------------------------------------------------------
Due within six months             $2,961.6      44.80%    $3,628.1       46.93%
Due within six to twelve months    1,745.6      26.40      2,141.4       27.70
Due within one to two years        1,311.6      19.84      1,003.3       12.98
Due within two to three years        305.0       4.61        612.6        7.92
Due within three to four years       179.7       2.72        183.2        2.37
Due within four to five years         69.1       1.05        129.5        1.68
Due beyond five years                 38.8       0.58         32.7        0.42
  Total                           $6,611.4     100.00%    $7,730.8      100.00%


Included in term certificates of deposit are certificates in denominations of 
$100,000 or more at December 31, 1996 and 1995, aggregating $687.8 million and 
$771.0 million, respectively. 


Interest expense on deposits is summarized as follows:

                                    Year Ended December 31,
                                  ---------------------------
(In millions)                       1996      1995      1994
-------------------------------------------------------------
Account type:
  N.O.W. and checking             $  6.1    $  3.4    $  2.2
  Savings and club                  55.2      28.4      20.2
  Variable rate savings             66.1      41.5      43.2
  Money market                      19.5      14.2      14.8
  Term certificates of deposit     377.8     257.0     144.6
    Total                         $524.7    $344.5    $225.0


10. PREFERRED STOCK OF SUBSIDIARY

GreenPoint Mortgage Trust (the "Trust"), a wholly-owned subsidiary of the Bank, 
is a newly formed real estate investment trust established for the purpose of 
acquiring, holding and managing real estate mortgage assets.

During 1996, the Trust issued 10,000 shares of 12.0% cumulative preferred stock 
with a liquidation preference of $1,000. Preferred shareholders will be 
entitled to receive quarterly cumulative cash dividends, which is considered 
minority interest expense by the Company. 

The cumulative preferred shares may be redeemed at any time or from time to 
time, in whole or in part, at a redemption price equal to the liquidation 
value, plus any dividends accrued and unpaid at the option of the Trust. The 
preferred shares are treated as Tier 1 capital for the Company and the Bank. 
The preferred shares have no stated maturity and are not subject to any 
mandatory sinking fund or redemption rights.


11. RESTRUCTURING CHARGE

In December 1995, the Company recorded a pre-tax restructuring charge of $8.0 
million that reflected actions initiated during the fourth quarter of that year 
and during 1996 to improve operating efficiency. In 1996, the Company recovered 
$1.6 million of the restructuring charge, due to lower than expected severance 
payments and write-downs on sold or closed facilities.


32



12. PENSION PLAN AND OTHER EMPLOYEE BENEFITS

DEFINED BENEFIT PENSION PLAN
The Bank maintains a noncontributory, qualified, defined benefit pension plan 
(the "Plan") covering sub-stantially all employees of the Company who have 
completed one year of service with the Company. Effective May 6, 1996, the Plan 
was amended to calculate future benefits under a cash balance formula. Each 
participant has an account to which amounts are allocated based on a percentage 
of the participants eligible base salary and years of service, which grows at a 
specified rate of interest. Benefits accrued prior to May 6, 1996 were based 
primarily on each participant's years of service and highest average 
compensation. The funding of the Plan is actuarially determined on an annual 
basis. The Bank's Plan conforms to the requirements of the Employee Retirement 
Income Security Act of 1974, as amended.

The actuarial present value of benefit obligations as of December 31, 1996 and 
1995 are shown as follows:

                                                                 December 31,
                                                             ------------------
(In millions)                                                   1996      1995
-------------------------------------------------------------------------------
Actuarial present value of benefit obligation:
  Accumulated benefit obligation (including vested
  benefits of $26.3 and $24.7, respectively)                  $ 27.9    $ 28.5 
  Effect of future compensation                                  2.6       8.4 

    Projected benefit obligation                              $ 30.5    $ 36.9 

Plan assets at fair value (Primarily investments in 
  mutual fund shares of equity and bond funds)                $ 43.4    $ 38.7 
Projected benefit obligation                                   (30.5)    (36.9)
Plan assets in excess of projected benefit obligation           12.9       1.8
Amount contributed                                                 -       0.6
Unrecognized net transition asset                               (1.3)     (1.7)
Unrecognized net (gain) loss                                    (6.9)      1.6
Unrecognized prior service (benefit) cost                       (3.1)      0.3

    Prepaid pension cost                                      $  1.6    $  2.6 


Net periodic pension costs reported for the years ended December 31, 1996, 1995 
and 1994, were $1.0 million, $1.1 million and $1.1 million, respectively. 

The assumptions used for the years ended December 31, 1996, 1995 and 1994 to 
determine the net periodic pension cost were:

                                                      Year Ended December 31,
                                                    --------------------------
                                                     1996      1995      1994
------------------------------------------------------------------------------
Weighted average discount rate                       7.50%     7.00%     8.50%
Rate of increase in future compensation levels       4.50%     6.00%     6.00%
Expected long-term rate of return on assets          8.00%     8.00%     8.00%


SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN AND RETIREMENT PLAN FOR DIRECTORS
The Bank maintains a nonqualified, unfunded Supplemental Executive Retirement 
Plan ("SERP") for the primary purpose of providing benefits to certain eligible 
employees in excess of limitations imposed by Federal tax law. At December 31, 
1996 and 1995, the SERP expense was $0.7 million and $0.5 million, respectively.

The Bank also maintains a non-qualified, unfunded defined benefit Retirement 
Plan for Directors who are not entitled to receive benefits under the Pension 
Plan. This plan provides retirement benefits to eligible retired or disabled 
Independent Directors and their beneficiaries. At December 31, 1996 and 1995, 
the Retirement Plan for Directors expense was $0.3 million and $0.5 million, 
respectively.

401(K) SAVINGS PLAN
During 1996, the Bank amended its Incentive Savings Plan to include provisions 
under Section 401(k) of the Internal Revenue Code of 1986, as amended (the 
"401(k) Savings Plan"). Substantially all of the employees of the Company 
employed prior to July 1, 1996 are eligible to participate. Participants may 
contribute on a pre-tax basis up to 6% of their eligible salary and may be 
eligible to receive a matching contribution equal to 100% of the first 3% of 
eligible salary they contribute to the 401(k) Savings Plan. Participants may 
invest their pre-tax contributions in any of the investment funds made 
available under the 401(k) Savings Plan, including a fund that invests 
primarily in the Company's stock. The matching contribution may be funded by 
using some of the shares released for allocation under the ESOP. Matching 
contributions generally become vested over a five-year period. Plan expense for 
matching contributions was approximately $0.8 million for the year ended 
December 31, 1996.

OTHER POSTRETIREMENT BENEFITS 
The Company provides certain unfunded health care and life insurance benefits 
to eligible retired employees. Participants generally become eligible for 
retiree health care and life insurance benefits after 10 years of service with 
the Company. The Company also gives retired directors the option of 
participating in certain retiree health care benefits.


33



The following table sets forth the Accumulated Postretirement Benefit 
Obligation ("APBO") at December 31, 1996 and 1995, respectively:

                                                December 31,
                                            -------------------
(In millions)                                 1996        1995
---------------------------------------------------------------
Retirees                                     $ 7.0       $ 7.0
Fully eligible active plan participants        1.8         3.3
Other plan participants                        5.2         6.0

    Total APBO                                14.0        16.3

Unrecognized prior service cost                0.2         0.3
Unrecognized gain (loss)                       0.3        (3.6)
Accrued postretirement benefit cost          $14.5       $13.0


The net postretirement benefits expense for the years ended December 31, 1996, 
1995 and 1994 was comprised of the following:

                                                        Year Ended December 31,
(In millions)                                            1996     1995     1994
-------------------------------------------------------------------------------
Service cost (benefits for service during the year)      $1.2     $0.7     $0.8
Interest cost on APBO                                     0.9      1.0      0.7
Net postretirement benefits expense                      $2.1     $1.7     $1.5


In measuring the APBO, a 9.0% annual trend rate for health care costs was 
assumed for the year ended December 31, 1996, and an 11.5% annual trend rate 
was assumed for the years ended December 31, 1995 and 1994. This rate is 
assumed to decline to 5.0% by the year 2000. The weighted average discount rate 
used in determining the APBO was 7.5%, 7.0% and 8.5%, for the years ended 
December 31, 1996, 1995 and 1994, respectively.

If the assumed health care cost trend rate increased by 1%, the APBO as of 
December 31, 1996 would increase by $1.8 million. The effect of a 1% increase 
in the cost trend rate on the service and interest cost components of net 
periodic postretirement benefits expense would be an increase of $0.3 million.

EMPLOYER'S ACCOUNTING FOR POSTEMPLOYMENT BENEFITS
The Company is accounting for postemployment benefits on a comprehensive 
accrual basis. This basis requires the Company to charge to expense the 
expected costs of providing these benefits to all postemployment employees, 
during the years such employees are actively employed by the Company. At 
December 31, 1996 and 1995, the Company's postemployment liability was 
approximately $0.5 million and $1.2 million, respectively. 


13. INCOME TAXES

For the tax years prior to 1996, a special bad debt deduction was allowed for 
additions to the Bank's tax bad debt reserves. As a result of recently enacted 
Federal legislation, for tax years beginning after January 1, 1996, the Bank is 
only permitted to take deductions for bad debts for Federal tax purposes on the 
basis of actual loan charge-off activity. This legislation also requires that 
the Bank recapture into taxable income the portion of existing tax bad debt 
reserves created in the years beginning after December 31, 1987 over a six year 
period. The amount of such reserve subject to recapture at December 31, 1996 is 
approximately $2.0 million.

At December 31, 1996, no Federal income tax provision has been made against the 
Bank's pre-1988 tax bad debt reserve of approximately $140 million. However, 
these reserves remain subject to recapture should the Bank make certain 
non-dividend distributions or cease to maintain a Bank charter. Management has 
no intention of taking any such actions.

For New York State income tax purposes, the Bank is permitted to continue to 
take special reserve method bad debt deductions. At December 31, 1996, the Bank 
maintained a state tax bad debt reserve in excess of the Federal reserve of 
approximately $161 million for which no state tax has been provided. In the 
event the Bank were to allow qualifying assets to fall below 60% or otherwise 
fail state definitional tests, the balance of the reserve would be subject to 
recapture into taxable income. Furthermore, any charge to the qualifying tax 
bad debt reserves other than for losses on qualifying loans may create income 
for State tax purposes only. The Bank's qualifying assets at December 31, 1996 
and 1995 exceeded 60%.

The Company's deferred tax asset represents the anticipated Federal, state and 
local tax benefits expected to be realized in future years upon the utilization 
of the underlying tax attributes comprising this balance. In management's 
opinion, the net deferred tax asset is fully realizable. Accordingly, no 
valuation allowance has been provided.

The components of income tax expense for the years ended December 31, 1996, 
1995 and 1994, are summarized as follows:


34



                                Year Ended December 31,
(In millions)             1996        1995        1994
-------------------------------------------------------
Current:
Federal                  $60.3       $34.3       $33.4
State and local           10.2        17.2        18.2

    Total current         70.5        51.5        51.6

Deferred:
Federal                   11.4        24.1        28.8
State and local           10.1        15.3        17.6

    Total deferred        21.5        39.4        46.4
    Total                $92.0       $90.9       $98.0


In addition to the income tax expense attributable to operations, deferred 
income tax (benefit) liability in the amount of $(31.6) million and $12.6 
million was separately allocated to stockholders' equity to recognize the 
related tax effect of the net unrealized gain or loss on securities available 
for sale for the years ended December 31, 1996, and 1995, respectively.

The amounts reported as income tax expense vary from amounts that would be 
reported by applying the statutory Federal income tax rate to income before 
income taxes due to the following:

<TABLE>
<CAPTION>
                                                         Year Ended December 31,
                                        ----------------------------------------------------------
(In millions)                                   1996                1995               1994
--------------------------------------  ------------------  ------------------  ------------------
                                                Percentage          Percentage          Percentage
                                                of Pre-tax          of Pre-tax          of Pre-tax
                                        Amount   Earnings   Amount   Earnings   Amount   Earnings
--------------------------------------------------------------------------------------------------
<S>                                     <C>      <C>        <C>      <C>        <C>      <C>
Tax expense at Federal statutory rate    $78.6     35.00%    $69.4     35.00%    $73.8     35.00%
State and local taxes, net of Federal
  income tax benefit                      13.2      5.89      20.9     10.53      23.3     11.05
Other                                      0.2      0.09       0.6      0.29       0.9      0.42
    Total income taxes                   $92.0     40.98%    $90.9     45.82%    $98.0     46.47%
</TABLE>

Included in deferred income tax expense for the years ended December 31, 1995 
and 1994 are expenses of $0.8 million and $0.4 million, respectively, relating 
to adjustments to deferred tax assets and liabilities for enacted changes in 
tax laws and rates.


35



The balances of the net deferred tax asset at December 31, 1996 and 1995 were 
comprised as follows:

                                                                  December 31,
(In millions)                                                1996        1995
------------------------------------------------------------------------------
DEFERRED TAX ASSETS:
  Allowance for possible loan losses                        $45.4      $ 48.0
  Non-accrued interest income on non-accrual loans            8.3        11.3
  Capitalized cost of acquisition, other real estate          4.4         2.7
  Other real estate, valuation allowance for market 
    decline                                                   0.1         0.8
  Postretirement and post-employment benefits                 6.8         5.2
  Restructuring charges                                         -         3.3
  Unrealized loss on securities available for sale           19.0           -
  Deferred loan fees                                            -         8.5
  Other                                                       4.4         6.2
                                                           -------------------
                                                            $88.4      $ 86.0

DEFERRED TAX LIABILITIES:
  Premises and equipment                                    $(3.4)     $ (2.4)
  Excess servicing asset                                     (1.8)       (0.9)
  Deferred loan fees                                         (3.0)          -
  Unrealized gain on securities available for sale              -       (12.6)
                                                           -------------------
                                                             (8.2)      (15.9)

  Net deferred tax asset                                    $80.2      $ 70.1


14. DERIVATIVE FINANCIAL INSTRUMENTS

The Bank enters into interest rate swap contracts in managing its interest rate 
risk. The notional amount of these contracts approximates $300 million at 
December 31, 1996. These contracts have a term of approximately 3 years. Under 
the terms of the contracts, the Bank pays an average fixed rate of 6.33% and 
receives an average variable rate of 5.52%. The notional amounts of derivatives 
do not represent amounts exchanged by the parties and, thus, are not a measure 
of the Company's exposure through its use of derivatives. The amounts exchanged 
are determined by reference to the notional amounts and the other terms of the 
derivatives.

Interest rate swaps are contracts in which a series of interest rate flows in a 
single currency are exchanged over a prescribed period. The risks inherent in 
interest rate swaps are the potential inability of a counterparty  to meet the 
terms of its contract and the risk associated with changes in the market values 
of the contracts due to movements in the underlying interest rates. The current 
credit exposure of derivatives is represented by the fair value of contracts 
with a positive fair value at the reporting date. To reduce credit risk, 
management may deem it necessary to obtain collateral.


15. COMMITMENTS AND CONTINGENCIES

In the normal course of business, there are various outstanding commitments and 
contingent liabilities that have not been reflected in the consolidated 
financial statements. In addition, in the normal course of business, there are 
various other outstanding legal proceedings. In the opinion of management, 
after consultation with legal counsel, the financial position of the Company 
will not be affected materially as a result of such commitments and contingent 
liabilities or by the outcome of such legal proceedings.

The principal commitments and contingent liabilities of the Company are 
discussed in the following paragraphs.

PENDING LITIGATION
The Bank or one of its subsidiaries has been named as a defendant in thirteen 
unrelated legal complaints which assert that infant plaintiffs sustained 
personal injuries from the ingestion of lead based paint, chips or dust. 
Additionally there are eleven other instances of threatened litigation. The 
complaints are in various early stages of discovery. Outside counsel has 
advised the Bank that because discovery on these claims has only recently 
begun, counsel is not yet in a position to express an opinion as to the Bank's 
liability or to quantify the Bank's potential exposure, if any, in dollar terms 
at the time. Because of the absence of both a determination of liability and a 
reasonable estimate of an associated liability exposure in dollar terms, if 
any, the Bank has not established a contingency reserve for these complaints. 
Accordingly, in the event that one or more of these actions are subsequently 
determined to represent an accruable liability for the Bank, such accruals 
would be funded through charges to be made against the Bank's operating income 
for the period or periods in which such determinations may occur. The Company 
currently believes that such liability exposure, if any, would not be material 
to the Bank's financial condition.

LOAN COMMITMENTS
At December 31, 1996 and 1995, the Company had outstanding commitments to 
originate mortgage loans totaling approximately $486.0 million and $209.1 
million, respectively. The commitments to originate mortgage loans at December 
31, 1996 included $371.8 million of commitments to originate fixed rate 
mortgage loans and $114.2 million of commitments to originate adjustable rate 
mortgage loans.

RECOURSE OBLIGATIONS
The Company has sold loans to FNMA with recourse obligations. The aggregate 
amount of loans still subject to recourse was $121.0 million at December 31, 
1996. The Company's obligation to repurchase loans is to be reduced by 49.6% at 
December 31, 1997, by another 45.0% at December 31, 1998 and by the final 5.4% 
at December 31, 1999.


36



LEASE COMMITMENTS
The Company has entered into noncancelable operating lease agreements for 
banking premises and equipment with expiration dates ranging through the year 
2023. The Company's premises are used principally for branch offices and 
administrative operations, and it is expected that many agreements will be 
renewed at expiration in the normal course of business.

Rental expense for Company premises for the years ended December 31, 1996, 1995 
and 1994 amounted to $9.1 million, $3.1 million and $1.2 million, respectively. 


The projected minimum rental payments under the terms of the noncancelable 
leases, exclusive of taxes and escalation charges, at December 31, 1996 are 
summarized as follows:

                   Year Ending
(In millions)      December 31,     Amount
------------------------------------------
                          1997      $ 12.3
                          1998        11.3
                          1999         9.1
                          2000         8.1
                          2001         7.9
                    thereafter        51.3
                         Total      $100.0


Minimum rental income under noncancelable sublease agreements aggregate $19.2 
million.


16. FAIR VALUE OF FINANCIAL INSTRUMENTS

The methods and assumptions used to estimate fair values are set forth in the 
following paragraphs for each major grouping of the Company's financial 
instruments.

                                       December 31, 1996     December 31, 1995
                                     --------------------  --------------------
                                     Carrying  Estimated   Carrying  Estimated
(In millions)                         Values  Fair Values   Values  Fair Values
-------------------------------------------------------------------------------
Assets:
Cash and due from banks              $   81.9   $   81.9   $  153.7   $  153.7
Interest-bearing deposits in other
  banks                                 105.6      105.6          -          -
Federal funds sold and securities 
  purchased under agreements to 
  resell                                388.5      388.5    1,550.7    1,550.7
Securities:
  Bonds and mortgage-backed 
    securities available for sale     4,355.4    4,355.4    5,896.5    5,896.5
  Bonds and mortgage-backed
    securities held to maturity           4.0        4.0        4.3        4.4
Loans receivable held for sale            4.8        4.8      175.1      175.1
Loans receivable held for investment  7,294.3    7,469.7    5,858.6    6,065.7
Liabilities:
Deposits:
  Deposits due on demand and/or
    with no specified maturities      4,840.9    4,840.9    5,167.5    5,167.5
  Term certificates of deposit        6,611.4    6,669.0    7,730.8    7,822.2
Accrued Interest:
  Receivable                             89.5       89.5       73.0       73.0
  Payable                                 6.3        6.3        2.4        2.4
Securities sold under agreement to 
  repurchase                             89.5       89.5          -          -
Off-balance sheet:
  Commitment to originate mortgage loans    -      486.0          -      238.0
  Mandatory delivery commitments and 
    option related contracts                -          -        0.6       (0.5)
  Interest rate swaps                       -       (1.8)         -          -


CASH AND DUE FROM BANKS
The carrying values of cash and due from banks approximate fair values.

INTEREST-BEARING DEPOSITS IN OTHER BANKS
The carrying values of interest-bearing deposits in other banks approximate 
fair values.

FEDERAL FUNDS SOLD AND SECURITIES PURCHASED UNDER AGREEMENTS TO RESELL
The carrying values of federal funds sold and securities purchased under 
agreements to resell approximate fair values.

SECURITIES
The fair values of bonds and mortgage-backed securities are based on published 
market valuations or estimated price quotations provided by securities dealers.

LOANS RECEIVABLE HELD FOR SALE
The fair values of loans held for sale are estimated using quoted market prices 
for securities backed by similar loans, adjusted for differences in loan 
characteristics.


37



LOANS RECEIVABLE HELD FOR INVESTMENT
Fair value of the Company's Mortgage Loan portfolio is based on comprehensive 
portfolio valuation analyses performed as of December 31, 1996 and 1995 by an 
independent pricing firm, engaged specifically for this purpose by the Company.

The remaining categories of loans, home equity loans, student loans and home 
improvement loans, were deemed to have estimated market values approximating 
their respective carrying values.

DERIVATIVE INSTRUMENTS
Mandatory Delivery Commitments-The fair value of commitments is estimated by 
comparing the Company's cost to acquire mortgages to the current price for 
similar mortgage loans, taking into account the terms of the commitments.

Option Contracts-Fair value is determined utilizing quotes obtained from 
established reputable sources within the industry.

Interest Rate Swaps-the fair value generally reflects the estimated amounts 
that the Company would receive or pay to terminate the contracts at the 
reporting date, thereby taking into account the current unrealized gains or 
losses of open contracts.

DEPOSITS
The fair value of all deposits with no specified maturities is deemed to be 
equal to the amounts payable on demand. 

The fair value of the Company's term certificates of deposit was estimated by 
discounting cash flows based on contractual maturities at current interest 
rates for raising funds of similar remaining maturities.

ACCRUED INTEREST RECEIVABLE AND PAYABLE
The fair value of these financial assets and liabilities approximate their 
carrying values.

SECURITIES SOLD UNDER AGREEMENTS TO REPURCHASE
The carrying values of securities sold under agreements to repurchase 
approximate their fair values.

COMMITMENTS TO ORIGINATE MORTGAGE LOANS
The fair value of loan commitments issued and outstanding is based on rates and 
terms of similar commitments issued by the Company on December 31, 1996 and 
1995, respectively.

LIMITATIONS
Fair value estimates are made at a specific point in time, based on relevant 
market information and information about the financial instruments being 
estimated. 

These estimates do not reflect any premium or discount that could result from 
offering for sale at one time the Company's entire holdings of a particular 
financial instrument. In those instances for which no market exists for 
portions of the Company's financial instruments, fair value estimates were 
based on judgments regarding future expected loss experience, current economic 
conditions, risk characteristics of the affected financial instruments, and 
other factors. These estimates are subjective in nature and involve 
uncertainties and matters of significant judgment and, therefore, should not be 
considered to represent any specific market values. Changes in the assumptions 
could significantly affect the fair valuation estimates.


17. REGULATORY MATTERS 

The Company and the Bank are subject to various regulatory capital requirements 
administered by the Federal and state banking agencies. The Board of Governors 
of the Federal Reserve System establishes minimum capital requirements for the 
consolidated bank holding company as well as for the Bank.

Under capital adequacy guidelines and the regulatory framework for prompt 
corrective action, the Bank must meet specific capital guidelines that involve 
quantitative measures of its assets, liabilities, and certain off balance sheet 
items as calculated under regulatory accounting practices. These guidelines 
require minimum ratios of risk-based capital to risk adjusted assets of 4% for 
Tier 1 capital and 8% for total capital. The Federal Reserve Board also has 
guidelines for a leverage ratio that is designed to complement the risk-based 
capital ratios in determining the overall capital adequacy of banks and bank 
holding companies. A minimum leverage ratio to Tier 1 capital to average total 
assets of 3% is required for banks and bank holding companies, with an 
additional 100 to 200 basis points required for all but the highest rated 
institutions. Management believes, as of December 31, 1996, that the Company 
and the Bank meet all capital adequacy requirements to which it is subject.

As of December 31, 1996, the most recent notification from the FDIC 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 Tier 1 capital, total capital and leverage ratios of 6%, 10% 
and 5%, respectively. There have been no conditions or events since that 
notification that management believes have changed the Company's or Bank's 
category.


38



                                                                 For Capital
                                                  Actual      Adequacy Purposes
                                             ---------------- -----------------
(In millions)                                Amount    Ratio    Amount   Ratio
-------------------------------------------------------------------------------
As of December 31, 1996
Total Capital (to Risk Weighted  Assets):
  Company                                    $932.8    16.72%   $446.2   8.00%
  Bank                                        914.2    16.40%    445.8   8.00%
Tier 1 Capital (to Risk Weighted Assets):
  Company                                    $863.1    15.47%   $223.1   4.00%
  Bank                                        844.5    15.15%    222.9   4.00%
Tier 1 Capital (to Average Assets):
  Company                                    $863.1     6.78%   $509.0   4.00%
  Bank                                        844.5     6.64%    508.4   4.00%


                                                                 For Capital
                                                  Actual      Adequacy Purposes
                                             ---------------- -----------------
(In millions)                                Amount    Ratio    Amount   Ratio
-------------------------------------------------------------------------------
As of December 31, 1995
Total Capital (to Risk Weighted  Assets):
  Company                                    $932.8    17.50%   $426.3   8.00%
  Bank                                        921.5    17.30%    426.1   8.00%
Tier 1 Capital (to Risk Weighted Assets):
  Company                                    $866.2    16.25%   $213.1   4.00%
  Bank                                        854.9    16.05%    213.0   4.00%
Tier 1 Capital (to Average Assets):
  Company                                    $866.2     6.19%   $559.5   4.00%
  Bank                                        854.9     6.11%    559.2   4.00%


DIVIDEND LIMITATION
The Company's principal source of funds for distributions of dividends to 
shareholders, stock repurchase activities and any acquisitions to be made at 
the holding company level, are dividends from the Bank.  Federal law imposes 
limitations on the payment of dividends by member banks of the Federal Reserve 
System.  Under such limitations, dividend payments by such banks are limited to 
the lesser of (i)  the amount of undivided profits and (ii)  an amount not in 
excess of net income for the current year plus retained net income for the 
preceding two years. Dividends paid by the bank during 1996 were within these 
limitations.


18. STOCK BENEFIT PLANS

EMPLOYEE STOCK OWNERSHIP PLAN AND TRUST
The Bank's  Employee Stock Ownership Plan and Trust ("ESOP") covers 
substantially all employees of the Company who have been credited with 1,000 
hours of service during a twelve month period. Participants receive 
allocations on the basis of their eligible base compensation and generally 
become vested over a five-year period. Participants fully vest in their 
benefit upon retirement, death or disability while in active employment, 
or in the event of a change in control of the Company or the Bank. Participants 
who terminate employment before becoming 100% vested forfeit the unvested 
portion of their accounts. Forfeitures are reallocated among the remaining 
participants.

During 1994, the ESOP purchased 8,233,802 shares of the Company's common stock 
in 1994, at a weighted average price of $16.65 per share. The purchases were 
funded with a loan of $137.1 million from the Company, which is collateralized 
by the unallocated Company shares owned by the ESOP. The loan will be repaid 
primarily from contributions by the Bank and dividends paid by the Company on 
unallocated shares over the applicable loan amortization period. The 
outstanding principal balance of the loan as of December 31, 1996 and 1995 was 
$129.9 million and $130.9 million, respectively, and the interest rate was 
6.00% at both dates.

The shares owned by the ESOP are held by a third party trustee and released for 
allocation to participants as repayments of the loan are made. The number of 
shares released for allocation in any year is based upon the ratio of current 
year principal and interest payments to the total of current year and all 
projected future years' principal and interest payments. As of December 31, 
1996, 1,054,415 shares have been allocated to participants' accounts. There are 
7,179,387 unallocated shares with a value of $341.0 million, based upon the 
December 31, 1996 closing price of $47.50 per share.

The Company recognized $8.2 million, $10.5 million and $7.8 million of 
compensation expense relating to the ESOP for the years ended December 31, 
1996, 1995 and 1994, respectively.

RESTRICTED STOCK PLAN
The Bank's Recognition and Retention Plan ("RRP"), authorizes the granting of 
up to 1,242,018 shares of the Company's common stock to officers, employees and 
directors emeriti of the Company. 

In 1994, the Bank purchased 1,242,018 shares of the Company's common stock on 
behalf of the RRP, at the initial public offering price of $15.00 per share. 
Through December 31, 1996, 1,215,044 shares have been awarded to participants. 
These awards vest ratably over a three to five year period on the anniversary 
dates of the awards. Participants' awards fully vest upon retirement, death or 
disability while in active employment, or in the event of the participant's 
termination of employment due to a change in control of the Company or the Bank.

For the years ended December 31, 1996, 1995 and 1994, the Company recognized 
$5.1 million, $4.6 million and $4.4 million, respectively, of compensation 
expense relating to the RRP.


39



STOCK INCENTIVE PLAN
Under the Amended and Restated 1994 Stock Incentive Plan (the "Stock Incentive 
Plan"), grants may be made in the form of incentive stock options ("ISOs"), 
non-statutory stock options ("NSOs"), limited rights and restricted stock to 
officers and other key employees. The Stock Incentive Plan provides that the 
total number of shares available for grant shall be 3,500,000 shares of the 
Company's common stock.

The ISOs and NSOs granted under the Stock Incentive Plan vest and become 
exercisable over a three to five year period and expire on the tenth 
anniversary of the grant. In the event of the employee's death, disability, or 
retirement while in active employment or in the event of an employee's 
termination of service due to a change in control of the Company or the Bank, 
all ISOs and NSOs held by such participant vest and generally become 
exercisable in full for a period of one year. The term during which any future 
ISOs and NSOs granted vest and become exercisable is at the discretion of the 
Compensation Committee. The exercise price for all ISOs or NSOs is at least 
100% of the fair market value of the stock on the grant date. 

As of December 31, 1996, 150,000 shares of restricted stock at a 
weighted-average fair value of $24.62, had been granted under the Stock 
Incentive Plan.

The following table presents a summary of the aggregate stock option 
transactions for the years ended December 31, 1996 and 1995.

                                                Year Ended December 31,
                                    -------------------------------------------
                                             1996                  1995
                                    ---------------------  --------------------
                                                Weighted               Weighted
                                     Number of   Average   Number of    Average
                                       Stock    Exercise     Stock     Exercise
                                      Options     Price     Options      Price
-------------------------------------------------------------------------------
Stock options outstanding,
  beginning of period                2,737,562    $19.31   1,536,696    $15.77
Granted                                272,000     31.67   1,304,734     23.14
Exercised                             (267,017)    15.38     (73,564)    15.00
Canceled                               (60,152)    18.01     (30,304)    15.00

Stock options outstanding, end of 
  period                             2,682,393    $20.98   2,737,562    $19.31

Options exercisable at year-end        482,310               188,367
Weighted-average fair value of 
  options granted during the year        $8.48                 $5.68


The range of exercise prices on options outstanding for the years ended 
December 31, 1996 and 1995 were $15.00 to $48.25 and $15.00 to $27.25, 
respectively. The weighted average remaining contractual life for options 
outstanding at December 31, 1996 is 7.94 years.


DIRECTORS' STOCK OPTION PLAN
Under the Company's Directors' Stock Option Plan the Company may grant up to 
725,000 NSOs to directors who are not officers or employees of the Company 
("Non-Employee Directors").

The exercise price is equal to 100% of the fair market value of the stock on 
the grant date. The term of each NSO is ten years from the grant date. All 
NSOs become exercisable over a ten-year period. In the event of the death, 
retirement or disability of the Non-Employee Director or upon a change in 
control of the Company these NSOs become immediately exercisable.





The following table presents a summary of the aggregate NSO transactions for 
the years ended December 31, 1996 and 1995.

                                                Year Ended December 31,
                                    -------------------------------------------
                                             1996                  1995
                                     ---------------------  -------------------
                                                  Weighted             Weighted
                                         Number    Average    Number    Average
                                           of     Exercise      of     Exercise
                                          NSOs      Price      NSOs      Price
-------------------------------------------------------------------------------
NSOs outstanding, beginning of period   621,000    $21.96     15,000    $24.25
Granted                                   6,000     28.50    606,000     21.90
NSOs outstanding, end of period         627,000    $22.02    621,000    $21.96
Options exercisable at year-end         102,495                9,000
Weighted-average fair value of 
  options granted during the year         $4.20                $6.90

The range of exercise prices on options outstanding for the year ended December 
31, 1996 and 1995 were $21.88 to $28.50 and $21.88 to $24.25, respectively. The 
weighted average remaining contractual life for options outstanding at December 
31, 1996 is 8.08 years.

40


Because stock options under the Stock Incentive Plan and the Directors Stock 
Option Plan have characteristics significantly different from those of traded 
options and because changes in the subjective assumptions can materially affect 
the fair value estimate, the Company used a Black Scholes option-pricing model 
with the following weighted-average assumptions used for grants in 1996 and 
1995:

                            Year Ended December 31,
                                1996          1995
---------------------------------------------------
Dividend yield                  2.60%         3.52%
Expected volatility            22.70%        24.62%
Risk-free interest rate         6.54%         7.09%
Expected option lives      5.65 years    6.79 years

Had compensation cost for the Company's stock-based compensation plans been 
determined based on the fair value at the grant dates for awards made under 
those plans, consistent with the method of SFAS No. 123, the Company's net 
income and earnings per share would have been reduced to the pro forma amounts 
indicated below:

                                       Year Ended December 31,
(In millions, except per share data)           1996       1995
---------------------------------------------------------------
Net income              As reported          $132.5     $107.5
                        Pro forma            $130.7     $106.4
Earnings per share      As reported          $ 3.02     $ 2.29
                        Pro forma            $ 2.98     $ 2.27

The effects of applying SFAS No. 123 for providing pro forma disclosures are 
not indicative of the effects on reported net income for future years because 
SFAS No. 123 has not been applied to all outstanding, non-vested awards (does 
not apply to awards prior to January 1, 1995). Additional awards in future 
years are anticipated.

19. EDUCATIONAL AND CHARITABLE FOUNDATION

The Bank has committed to endow a $50 million Educational and Charitable 
Foundation (the "Foundation"). The purpose of the Foundation is to fund grants 
for civic, cultural, affordable housing and educational programs within the 
communities served by the Bank. The endowment of this program is to be 
established through contributions of a percentage of future net earnings in 
excess of an annual amount of $90 million of pro forma earnings by the Bank. As 
of December 31, 1996, the Bank has contributed $9.9 million, or 19.8%, of its 
funding commitment to the Foundation. 

20. CONDENSED PARENT COMPANY FINANCIAL STATEMENTS

The following condensed statements of financial condition at December 31, 1996 
and 1995 and condensed statements of income and cash flows for the years ended 
December 31, 1996 and 1995 and for the period from January 28, 1994 (date of 
conversion) to December 31, 1994 for GreenPoint Financial Corp. (parent 
company only) reflect the Company's investment in its wholly-owned subsidiaries 
using the equity method of accounting. 

PARENT COMPANY ONLY-CONDENSED STATEMENTS OF FINANCIAL CONDITION
                                                         December 31,
(In millions)                                      1996         1995
---------------------------------------------------------------------
ASSETS:
Cash and due from banks                        $    0.6     $    0.4
  Money market investments                         12.5          6.7
  Banking premises and equipment                      -          0.2
  Other assets                                      0.5            -
  Investment in subsidiaries                    1,446.3      1,545.1
  Total assets                                 $1,459.9     $1,552.4

LIABILITIES AND STOCKHOLDERS' EQUITY: 
LIABILITIES:
  Accrued income taxes payable                 $    0.1     $    0.1
  Other liabilities                                   -          1.0
  Total liabilities                                 0.1          1.1
  Stockholders' equity                          1,459.8      1,551.3
  Total liabilities and stockholders' equity   $1,459.9     $1,552.4

PARENT COMPANY ONLY-CONDENSED STATEMENTS OF INCOME
                                                                    Period from
                                                                       Jan. 28,
                                                       Year Ended      1994 to
                                                      December 31,     Dec. 31,
                                                   ------------------  --------
(In millions)                                         1996      1995      1994
-------------------------------------------------------------------------------
Dividends from GreenPoint Bank                      $207.9    $ 47.9    $ 28.1
Interest Income:
  Loan to GreenPoint Bank ESOP                           -       5.8       7.3
  Money market investments                             0.4       5.4       3.0
  Securities held to maturity                            -       8.1       7.9
    Total interest income                              0.4      19.3      18.2

Securities lending fees                                  -       0.1       0.1
Total income                                         208.3      67.3      46.4

Administrative expenses                                0.5       1.1       0.9
  Income before income taxes and equity in 
    undistributed (loss) earnings of subsidiaries    207.8      66.2      45.5
Income taxes                                             -       8.3       8.2
Income before equity in undistributed (loss) 
  earnings of subsidiaries                           207.8      57.9      37.3
Equity in undistributed(loss)earnings of 
  subsidiaries                                       (75.3)     49.6      67.4
  Net income                                        $132.5    $107.5    $104.7


41


PARENT COMPANY ONLY-CONDENSED STATEMENTS OF CASH FLOWS
                                                                    Period from
                                                                       Jan. 28,
                                                        Year Ended     1994 to
                                                       December 31,    Dec. 31,
                                                   ------------------  --------
(In millions)                                         1996      1995      1994
-------------------------------------------------------------------------------
OPERATING ACTIVITIES:
  Net income                                       $ 132.5   $ 107.5   $ 104.7
  Adjustments to reconcile net income to net 
    cash provided by operating activities:
  Equity in undistributed loss (earnings) 
    of subsidiaries                                   75.3     (49.6)    (67.4)
  Net change in other liabilities                     (1.0)     (1.1)      2.2
  Net change in other assets                          (0.5)      0.5      (0.5)
  Other, net                                             -      (2.6)     (6.3)
Net cash provided by operating activities            206.3      54.7      32.7

INVESTING ACTIVITIES:
  Purchases of securities                                -         -    (445.9)
  Maturities of securities                               -     170.2     185.0
  Funds loaned to GreenPoint Bank ESOP                   -         -    (137.1)
  Payments for investments in and advances
     to subsidiaries                                     -    (124.3)   (288.4)
  Repayment of investments in and advances 
    to subsidiaries                                      -       0.6         -
  Principal payments of ESOP loans                       -         -       2.9
  Other, net                                           0.2      (0.2)     (0.1)
Net cash provided by (used in) investing 
  activities                                           0.2      46.3    (683.6)

FINANCING ACTIVITIES:
  Proceeds from issuance of common stock               3.1       1.1     694.3
  Purchase of treasury stock                        (169.5)    (73.8)        -
  Dividends paid                                     (34.1)    (36.8)    (27.8)
Net cash (used in) provided by financing 
  activities                                        (200.5)   (109.5)    666.5
Net increase (decrease) in cash and cash 
  equivalents                                          6.0      (8.5)     15.6
Cash and cash equivalents at beginning of 
  period                                               7.1      15.6         -
Cash and cash equivalents at end of period         $  13.1    $  7.1    $ 15.6

In connection with the HSA acquisition in September 1995, the Company made a 
$353.2 million capital contribution to the Bank. The contribution was affected 
through the transfer of certain assets as detailed in the table below:

Cash                                $113.1 
Securities held to maturity           99.7 
ESOP loan receivable(1)              134.2 
Other                                  6.2 
  Total                             $353.2 

NOTE:
(1)The ESOP loan receivable relates solely to the Bank's employee stock 
ownership plan. The transfer assigns the right to receive the loan payments 
made by the ESOP trustee and does not release the Bank from its obligation to 
make contributions to the plan. 


42



QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)

<TABLE>
<CAPTION>
                                                       Year Ended December 31, 1996           Year Ended December 31, 1995
                                                 --------------------------------------  -------------------------------------
                                                   4th       3rd       2nd       1st       4th       3rd       2nd       1st
(In millions, except per share data)             Quarter   Quarter   Quarter   Quarter   Quarter   Quarter   Quarter   Quarter
------------------------------------------------------------------------------------------------------------------------------
<S>                                              <C>       <C.       <C>       <C>       <C>       <C>       <C>       <C>
Interest income                                  $237.4    $239.0    $246.5    $251.1    $252.4    $155.7    $145.6    $142.8
Interest expense on deposits                      122.9     126.9     134.2     143.5     151.0      72.8      63.8      58.2
Net interest income                               114.5     112.1     112.3     107.6     101.4      82.9      81.8      84.6
(Provision for) recovery of possible loan losses   (4.9)     (3.4)     (3.7)     (3.7)      2.5      (3.8)     (2.7)     (5.5)
Net interest income after provision for 
  possible loan losses                            109.6     108.7     108.6     103.9     103.9      79.1      79.1      79.1
Non-interest income                                10.8      11.2      23.4      11.5      12.7       9.4       7.5       6.2
Non-interest expense                               63.3      64.9      67.2      67.8      80.8      33.7      31.8      32.3
Income before income taxes                         57.1      55.0      64.8      47.6      35.8      54.8      54.8      53.0
Income taxes                                       23.3      20.9      27.5      20.3      16.4      24.6      25.4      24.5
Net income                                       $ 33.8    $ 34.1    $ 37.3    $ 27.3    $ 19.4    $ 30.2    $ 29.4    $ 28.5

Earnings per share                               $ 0.81    $ 0.79    $ 0.83    $ 0.60    $ 0.42    $ 0.64    $ 0.62    $ 0.60

Stock price per common share
  High                                           $50.13    $38.25    $30.50    $29.00    $29.50    $28.25    $24.25    $24.25
  Low                                            $39.25    $27.00    $27.25    $24.00    $25.13    $23.63    $22.00    $20.63
  Closing                                        $47.50    $38.13    $28.25    $27.50    $26.75    $27.63    $23.63    $23.13
</TABLE>


43


                      REPORT OF INDEPENDENT ACCOUNTANTS
_______________________________________________________________________________

TO THE BOARD OF DIRECTORS AND STOCKHOLDERS OF GREENPOINT FINANCIAL CORP. AND 
SUBSIDIARIES

In our opinion, the accompanying consolidated statement of financial condition 
and the related consolidated statements of income, changes in stockholders' 
equity and of cash flows, present fairly, in all material respects, the 
financial position of GreenPoint Financial Corp. and its subsidiaries at 
December 31, 1996, and the results of their operations and their cash flows for 
the year ended December 31, 1996, in conformity with generally accepted 
accounting principles. These financial statements are the responsibility of the 
Company's management; our responsibility is to express an opinion on these 
financial statements based on our audit. We conducted our audit of these 
statements in accordance with generally accepted auditing standards which 
require that we plan and perform the audit to obtain reasonable assurance about 
whether the financial statements are free of material misstatement. An audit 
includes examining, on a test basis, evidence supporting the amounts and 
disclosures in the financial statements, assessing the accounting principles 
used and the significant estimates made by management, and evaluating the 
overall financial statement presentation. We believe that our audit provides a 
reasonable basis for the opinion expressed above. The financial statements of 
GreenPoint Financial Corp. and its subsidiaries for the years ended December 
31, 1995 and 1994 were audited by other independent accountants whose report 
dated January 19, 1996 expressed an unqualified opinion on those statements.

/s/ PRICE WATERHOUSE LLP
New York, New York
January 21, 1997


44



                            DIRECTORS AND OFFICERS
_______________________________________________________________________________

BOARD OF DIRECTORS

BERNARD S. BERMAN
President of D. Berman and Sons Sales, Incorporated

EDWARD C. BESSEY
Retired Vice Chairman of Pfizer Inc.

DAN F. HUEBNER
Retired Vice Chairman and Director of Grumman Corporation

WILLIAM M. JACKSON
Partner in the law firm of Satterlee, Stephens, Burke & Burke, L.L.P.

THOMAS S. JOHNSON
Chairman, President and Chief Executive Officer

SUSAN J. KROPF 
Senior Vice President - President, New & Emerging Markets Avon Products, Inc.

ROBERT M. MCLANE
Retired Senior Vice President of Marsh & McLennan, Inc.

CHARLES B. MCQUADE
President and Chief Executive Officer of the Securities Industry
Automation Corporation

ALVIN N. PURYEAR
Professor of Management at Bernard M. Baruch College of 
the City University of New York

ROBERT P. QUINN
Retired General Partner and Managing Director of Solomon Brothers Inc.

EDWARD C. SCHMULTS
Retired Senior Vice President and General Counsel of GTE Corporation

WILFRED O. UHL
Retired President of The Long Island Lighting Company

ROBERT F. VIZZA
President and Chief Executive Officer of St. Francis Hospital

JULES ZIMMERMAN
Retired President and Chief Executive Officer of Hickok Associates,
Incorporated


SENIOR MANAGEMENT

THOMAS S. JOHNSON
Chairman, President and Chief Executive Officer

BHARAT B. BHATT
Vice Chairman

BERNADETTE ARIAS
Executive Vice President

MARTIN S. DASH
Executive Vice President

RALPH J. HALL
President and Chief Executive Officer of GreenPoint Mortgage Corp.

CHARLES P. RICHARDSON
Executive Vice President and Chief Financial Officer

RAMESH N. SHAH
Executive Vice President

HOWARD C. BLUVER
Senior Vice President and General Counsel



                            GREENPOINT FOUNDATION
_______________________________________________________________________________

                              BOARD OF DIRECTORS

THE REV. DR. CALVIN O. BUTTS III
The Abyssinian Baptist Church

DR. W. ANN REYNOLDS
Chancellor
City University of New York

MOST REV. JOSEPH M. SULLIVAN
Brooklyn Catholic Charities


45



                            CORPORATE INFORMATION
_______________________________________________________________________________

EXECUTIVE OFFICES
90 Park Avenue
New York, NY  10016-1303

COMMON STOCK
GreenPoint Financial Corp.'s common stock is listed on the New York Stock 
Exchange (NYSE) under the symbol GPT.

SOURCES OF INFORMATION
For information relating to share positions, transfer requirements, lost 
certificates and 
related matters, call our transfer agent at:  1-800-851-9677.

For information regarding Annual and Quarterly Reports and related matters, 
call our Stockholder Relations Department at 212-834-1710.

INDEPENDENT ACCOUNTANTS
Price Waterhouse LLP
1177 Avenue of the Americas
New York, NY  10036

TRANSFER AGENT
Chase Mellon Shareholder Services
JAF Building
P.O. Box 3068
New York, NY  10116-3068


46



GREENPOINT FINANCIAL


SUBSIDIARY ACTIVITIES 

    The Company has formed two subsidiaries:

    GREENPOINT COMMUNITY DEVELOPMENT CORP. This for-profit community 
development subsidiary was incorporated in 1993.  The subsidiary offers lending 
programs, development opportunities and assistance, consulting and other 
activities which promote the objective of greater access to affordable housing 
for low-and moderate-income persons residing in the New York metropolitan area. 
GreenPoint Community Development Corp. is a subsidiary of the holding company.

    GREENPOINT BANK. The Bank was organized in 1868 as a New York State 
chartered mutual savings bank.  On January 28, 1994, the Bank converted from 
the mutual to the stock form of ownership, and 100% of its outstanding shares 
were acquired by the Company.  The Bank is the principal subsidiary of the 
Company.

    As of December 31, 1996, the Bank has formed ten subsidiaries:

    GREENPOINT MORTGAGE CORP. This subsidiary was incorporated on October 12, 
1994 and began operations in the first quarter of 1995.  On July 7, 1995, GPMC 
acquired the wholesale residential mortgage lending business of 
BarclaysAmerican/Mortgage Corp. ("BAM").  GPMC's activities consist of the 
origination, sale and servicing of mortgage loans.

    GREENPOINT MORTGAGE TRUST.  This subsidiary was incorporated on February 
16, 1996, as a real estate investment trust established for the purpose of 
acquiring, holding and managing real estate mortgage assets.

    GREENPOINT PURCHASING CORP.  This subsidiary was incorporated on July 19, 
1996, with an agreement between the Company and the Nassau County Industrial 
Development Agency.  This agreement enables the Company, on a sales tax exempt 
basis, to (1) purchase and/or lease machinery and equipment for the Lake 
Success facility and (2) renovate and improve the facility.

    GREENPOINT CORPORATE OFFICER LIFE INSURANCE.  This subsidiary was 
incorporated on July 25, 1996, as an insurance trust established for the 
purpose of purchasing corporate life insurance policies for the officers of the 
Company.

    3090 OCEAN AVENUE REALTY CORP.  This subsidiary was incorporated on June 6, 
1996, as a real estate investment subsidiary.

    OTHER REAL ESTATE SUBSIDIARIES. The Bank has formed five wholly-owned 
subsidiary corporations, all of which are incorporated under the laws of the 
State of New York, for the purpose of holding and maintaining certain 
properties acquired by the Bank as a result of foreclosure proceedings or deeds 
in lieu thereof. As of December 31, 1996, four of these subsidiaries were 
active. The Bank attempts to limit the carrying value of property held by any 
one subsidiary to approximately $5 million. Accordingly, in the event the Bank 
acquires additional properties through foreclosure or deeds in lieu thereof, 
the Bank may form additional subsidiaries for the purpose of holding and 
maintaining such properties. The properties selected by the Bank to be held in 
its subsidiaries generally consist of multi-family properties with five units 
or more, commercial properties and one-to four-family properties which have 
been identified by the Bank as having attributes which may subject the Bank to 
liabilities beyond those normally associated with its other real estate such as 
properties which are not in compliance with building codes or properties with 
potential environmental problems. A description of the Bank's subsidiaries are 
set forth below: 

    NEERG CORP. This  subsidiary was formed in January 1990 and currently holds 
32 properties having an aggregate carrying value of $3.1 million and an 
aggregate appraised value of $4.1 million, as of December 31, 1996, based on 
the Company's most recent appraisals.  

    298 15TH STREET REALTY CORP. This subsidiary was formed in January 1993 and 
currently holds 30 properties having an aggregate carrying value of $2.8 
million and an aggregate appraised value of $3.9 million as of December 31, 
1996, based on the Company's most recent appraisals. 

    NEERG SECOND CORP. This  subsidiary was formed in June 1993 and currently 
holds 24 properties having an aggregate carrying value of $2.5 million and an 
aggregate appraised value of $3.2 million, as of December 31, 1996, based on 
the Company's most recent appraisals.

    ALPHA REO CORPORATION.  This subsidiary was formed in March 1994 and 
currently holds 30 properties having an aggregate carrying value of $2.7 
million and an aggregate appraised value of $3.7 million, as of December 31, 
1996, based on the Company's most recent appraisals.

    BETA REO CORP.  This subsidiary was formed in June 1994 and currently holds 
no properties.


Consent of Independent Accountants

We hereby consent to the incorporation by reference in the Registration 
Statement on Form S-8 (Nos. 33-74556,33-87758 and 33-87760) of GreenPoint 
Financial Corp. of our report dated January 21, 1997 appearing on Page 44 of 
the Annual Report to Stockholders which is incorporated in this Annual Report 
on Form 10-K.


/S/ PRICE WATERHOUSE LLP
New York, New York 
March 27, 1997





                      Report of Independent Accountants


To the Board of Directors and
Stockholders of GreenPoint Financial Corp.

In our opinion, the accompanying consolidated statement of financial condition 
and the related consolidated statements of income, of changes in stockholders' 
equity and of cash flows, appearing on pages 22 through 42 of the 1996 Annual 
Report to Stockholders, present fairly, in all material respects, the financial 
position of GreenPoint Financial Corp. and its subsidiaries at December 3l, 
1996, and the results of their operations and their cash flows for the year in 
conformity with generally accepted accounting principles.  These financial 
statements are the responsibility of the Company's management; our 
responsibility is to express an opinion on these financial statements based on 
our audit.  We conducted our audit of these statements in accordance with 
generally accepted auditing standards which require that we plan and perform 
the audit to obtain reasonable assurance about whether the financial statements 
are free of material misstatement.  An audit includes examining, on a test 
basis, evidence supporting the amounts and disclosures in the financial 
statements, assessing the accounting principles used and significant estimates 
made by management, and evaluating the overall financial statement 
presentation.  We believe that our audit provides a reasonable basis for the 
opinion expressed above.


/S/ PRICE WATERHOUSE LLP
New York, New York
January 21, 1997












INDEPENDENT AUDITORS' CONSENT

The Shareholders and the Board of Directors of GreenPoint Financial Corp.

We consent to incorporation by reference in the registrations statements 
(Nos. 33-74556, 33-87758 and 33-87760) on Form S-8 of GreenPoint Financial 
Corp. of our report dated January 19, 1996, relating to the consolidated 
statement of financial condition of GreenPoint Financial Corp. and 
Subsidiaries as of December 31, 1995 and the related consolidated statements 
of income, changes in stockholders' equity and cash flows for the years 
ended December 31, 1995 and 1994, which report is included in the December 
31, 1996 annual report on Form 10-K of GreenPoint Financial Corp.


                              By: /S/ KPMG Peat Marwick LLP
                                  KPMG PEAT MARWICK LLP


Jericho, New York
March 26, 1997




To the Board of Directors and Shareholders
GreenPoint Financial Corp. and Subsidiaries

We have audited the consolidated statement of financial condition of 
GreenPoint Financial Corp., and Subsidiaries as of December 31, 1995 and 
the related consolidated statements of income, changes in stockholders' 
equity and cash flows for the years ended December 31, 1995 and 1994.  These 
consolidated financial statements are the responsibility of the compnay's 
management.  Our responsibility is to express an opinion on these 
consolidated financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing 
standards.  Those standards require that we plan and perform the audit to 
obtain reasonable assurance about whether the financial statements are free 
of material misstatement.  An audit includes examining, on a test basis, 
evidence supporting the amounts and disclosures in the financial statements.  
An audit also includes assessing the accounting principles used and 
significant estimates made by management, a well as evaluating the overall 
financial statement presentation.  We believe that our audits provide a 
reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above 
present fairly, in all material respects, the financial position of GreenPoint 
Financial Corp. and Subsidiaries as of December 31, 1995 and the results of 
their operations and their cash flows for the years ended December 1995 and 
1994, in conformity with generally accepted accounting principles.


                              By:  /S/ KPMG Peat Marwick LLP
                                   KPMG PEAT MARWICK LLP


Jericho, New York
January 19, 1996