0001070154--12-312020Q1FALSEP3Y2,235,91900010701542020-01-012020-03-310001070154stl:CommonStockParValue0.01PerShareMember2020-01-012020-03-310001070154stl:DepositarySharesEachRepresenting140thInterestInAShareOf6.50NonCumulativePerpetualPreferredStockSeriesAMember2020-01-012020-03-31xbrli:shares00010701542020-05-01iso4217:USD00010701542020-03-3100010701542019-12-310001070154srt:SubsidiariesMember2020-03-310001070154srt:SubsidiariesMember2019-12-310001070154srt:ParentCompanyMember2020-03-310001070154srt:ParentCompanyMember2019-12-31iso4217:USDxbrli:shares00010701542019-01-012019-03-310001070154us-gaap:CommonStockMember2018-12-310001070154us-gaap:PreferredStockMember2018-12-310001070154us-gaap:AdditionalPaidInCapitalMember2018-12-310001070154us-gaap:TreasuryStockMember2018-12-310001070154us-gaap:RetainedEarningsMember2018-12-310001070154us-gaap:AccumulatedOtherComprehensiveIncomeMember2018-12-3100010701542018-12-310001070154us-gaap:RetainedEarningsMember2019-01-012019-03-310001070154us-gaap:AccumulatedOtherComprehensiveIncomeMember2019-01-012019-03-310001070154us-gaap:CommonStockMember2019-01-012019-03-310001070154us-gaap:AdditionalPaidInCapitalMember2019-01-012019-03-310001070154us-gaap:TreasuryStockMember2019-01-012019-03-310001070154us-gaap:PreferredStockMember2018-04-012018-06-300001070154us-gaap:CommonStockMember2019-03-310001070154us-gaap:PreferredStockMember2019-03-310001070154us-gaap:AdditionalPaidInCapitalMember2019-03-310001070154us-gaap:TreasuryStockMember2019-03-310001070154us-gaap:RetainedEarningsMember2019-03-310001070154us-gaap:AccumulatedOtherComprehensiveIncomeMember2019-03-3100010701542019-03-310001070154us-gaap:CommonStockMember2019-12-310001070154us-gaap:PreferredStockMember2019-12-310001070154us-gaap:AdditionalPaidInCapitalMember2019-12-310001070154us-gaap:TreasuryStockMember2019-12-310001070154us-gaap:RetainedEarningsMember2019-12-310001070154us-gaap:AccumulatedOtherComprehensiveIncomeMember2019-12-310001070154us-gaap:RetainedEarningsMember2020-01-012020-01-0100010701542020-01-012020-01-010001070154us-gaap:CommonStockMember2020-01-010001070154us-gaap:PreferredStockMember2020-01-010001070154us-gaap:AdditionalPaidInCapitalMember2020-01-010001070154us-gaap:TreasuryStockMember2020-01-010001070154us-gaap:RetainedEarningsMember2020-01-010001070154us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-01-0100010701542020-01-010001070154us-gaap:RetainedEarningsMember2020-01-012020-03-310001070154us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-01-012020-03-310001070154us-gaap:CommonStockMember2020-01-012020-03-310001070154us-gaap:TreasuryStockMember2020-01-012020-03-310001070154us-gaap:AdditionalPaidInCapitalMember2020-01-012020-03-310001070154us-gaap:PreferredStockMember2020-01-012020-03-310001070154us-gaap:CommonStockMember2020-03-310001070154us-gaap:PreferredStockMember2020-03-310001070154us-gaap:AdditionalPaidInCapitalMember2020-03-310001070154us-gaap:TreasuryStockMember2020-03-310001070154us-gaap:RetainedEarningsMember2020-03-310001070154us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-03-310001070154us-gaap:SeniorNotesMember2020-01-012020-03-310001070154us-gaap:SeniorNotesMember2019-01-012019-03-310001070154us-gaap:FederalHomeLoanBankAdvancesMember2020-01-012020-03-310001070154us-gaap:FederalHomeLoanBankAdvancesMember2019-01-012019-03-310001070154us-gaap:ResidentialMortgageMemberus-gaap:ResidentialPortfolioSegmentMember2020-01-012020-03-310001070154us-gaap:ResidentialMortgageMemberus-gaap:ResidentialPortfolioSegmentMember2019-01-012019-03-310001070154stl:SectorsImpactedByCOVID19Member2020-03-31xbrli:pure0001070154stl:CumulativeEffectPeriodOfAdoptionAdjustmentMemberus-gaap:FinancialAssetOtherThanFinancialAssetAcquiredWithCreditDeteriorationMember2020-01-012020-01-010001070154stl:CumulativeEffectPeriodOfAdoptionAdjustmentMemberstl:IncomeTaxExpenseBenefitMemberus-gaap:FinancialAssetOtherThanFinancialAssetAcquiredWithCreditDeteriorationMember2020-01-012020-01-010001070154stl:CumulativeEffectPeriodOfAdoptionAdjustmentMemberus-gaap:RetainedEarningsMemberus-gaap:FinancialAssetOtherThanFinancialAssetAcquiredWithCreditDeteriorationMember2020-01-012020-01-010001070154us-gaap:FinancialAssetAcquiredWithCreditDeteriorationMemberstl:CumulativeEffectPeriodOfAdoptionAdjustmentMember2020-01-012020-01-010001070154us-gaap:FinancialAssetAcquiredWithCreditDeteriorationMemberstl:CumulativeEffectPeriodOfAdoptionAdjustmentMemberstl:IncomeTaxExpenseBenefitMember2020-01-012020-01-010001070154us-gaap:FinancialAssetAcquiredWithCreditDeteriorationMemberstl:CumulativeEffectPeriodOfAdoptionAdjustmentMemberus-gaap:RetainedEarningsMember2020-01-012020-01-010001070154stl:CumulativeEffectPeriodOfAdoptionAdjustmentMember2020-01-012020-01-010001070154stl:CumulativeEffectPeriodOfAdoptionAdjustmentMemberstl:IncomeTaxExpenseBenefitMember2020-01-012020-01-010001070154stl:CumulativeEffectPeriodOfAdoptionAdjustmentMemberus-gaap:RetainedEarningsMember2020-01-012020-01-010001070154us-gaap:CorporateDebtSecuritiesMemberstl:CumulativeEffectPeriodOfAdoptionAdjustedBalanceMember2020-01-010001070154us-gaap:CorporateDebtSecuritiesMember2019-12-310001070154us-gaap:CorporateDebtSecuritiesMemberstl:CumulativeEffectPeriodOfAdoptionAdjustmentMember2020-01-010001070154us-gaap:USStatesAndPoliticalSubdivisionsMemberstl:CumulativeEffectPeriodOfAdoptionAdjustedBalanceMember2020-01-010001070154us-gaap:USStatesAndPoliticalSubdivisionsMember2019-12-310001070154us-gaap:USStatesAndPoliticalSubdivisionsMemberstl:CumulativeEffectPeriodOfAdoptionAdjustmentMember2020-01-010001070154stl:CumulativeEffectPeriodOfAdoptionAdjustedBalanceMember2020-01-010001070154stl:CumulativeEffectPeriodOfAdoptionAdjustmentMember2020-01-010001070154stl:OriginatedLoanMember2019-12-310001070154stl:AcquiredLoanMember2019-12-310001070154stl:OriginatedLoansMemberus-gaap:CommercialPortfolioSegmentMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:AcquiredLoanMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154stl:OriginatedLoansMemberus-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberstl:AcquiredLoanMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMember2019-12-310001070154us-gaap:ResidentialMortgageMemberstl:OriginatedLoansMemberus-gaap:ResidentialPortfolioSegmentMember2019-12-310001070154us-gaap:ResidentialMortgageMemberus-gaap:ResidentialPortfolioSegmentMemberstl:AcquiredLoanMember2019-12-310001070154us-gaap:ResidentialMortgageMemberus-gaap:ResidentialPortfolioSegmentMember2019-12-310001070154us-gaap:ConsumerLoanMemberstl:OriginatedLoansMemberus-gaap:ConsumerPortfolioSegmentMember2019-12-310001070154us-gaap:ConsumerLoanMemberus-gaap:ConsumerPortfolioSegmentMemberstl:AcquiredLoanMember2019-12-310001070154us-gaap:ConsumerLoanMemberus-gaap:ConsumerPortfolioSegmentMember2019-12-310001070154stl:OriginatedLoansMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:CumulativeEffectPeriodOfAdoptionAdjustmentMemberus-gaap:FinancialAssetOtherThanFinancialAssetAcquiredWithCreditDeteriorationMemberus-gaap:CommercialAndIndustrialSectorMember2020-01-010001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:FinancialAssetOtherThanFinancialAssetAcquiredWithCreditDeteriorationMemberus-gaap:CommercialAndIndustrialSectorMember2020-01-010001070154us-gaap:CommercialPortfolioSegmentMemberstl:CumulativeEffectPeriodOfAdoptionAdjustedBalanceMemberus-gaap:CommercialAndIndustrialSectorMember2020-01-010001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberstl:CumulativeEffectPeriodOfAdoptionAdjustmentMemberus-gaap:FinancialAssetOtherThanFinancialAssetAcquiredWithCreditDeteriorationMember2020-01-010001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberus-gaap:FinancialAssetOtherThanFinancialAssetAcquiredWithCreditDeteriorationMember2020-01-010001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberstl:CumulativeEffectPeriodOfAdoptionAdjustedBalanceMember2020-01-010001070154us-gaap:ResidentialMortgageMemberstl:CumulativeEffectPeriodOfAdoptionAdjustmentMemberus-gaap:ResidentialPortfolioSegmentMemberus-gaap:FinancialAssetOtherThanFinancialAssetAcquiredWithCreditDeteriorationMember2020-01-010001070154us-gaap:ResidentialMortgageMemberus-gaap:ResidentialPortfolioSegmentMemberus-gaap:FinancialAssetOtherThanFinancialAssetAcquiredWithCreditDeteriorationMember2020-01-010001070154us-gaap:ResidentialMortgageMemberus-gaap:ResidentialPortfolioSegmentMemberstl:CumulativeEffectPeriodOfAdoptionAdjustedBalanceMember2020-01-010001070154us-gaap:ConsumerLoanMemberstl:CumulativeEffectPeriodOfAdoptionAdjustmentMemberus-gaap:ConsumerPortfolioSegmentMemberus-gaap:FinancialAssetOtherThanFinancialAssetAcquiredWithCreditDeteriorationMember2020-01-010001070154us-gaap:ConsumerLoanMemberus-gaap:ConsumerPortfolioSegmentMemberus-gaap:FinancialAssetOtherThanFinancialAssetAcquiredWithCreditDeteriorationMember2020-01-010001070154us-gaap:ConsumerLoanMemberus-gaap:ConsumerPortfolioSegmentMemberstl:CumulativeEffectPeriodOfAdoptionAdjustedBalanceMember2020-01-010001070154stl:CumulativeEffectPeriodOfAdoptionAdjustmentMemberus-gaap:FinancialAssetOtherThanFinancialAssetAcquiredWithCreditDeteriorationMember2020-01-010001070154us-gaap:FinancialAssetOtherThanFinancialAssetAcquiredWithCreditDeteriorationMember2020-01-010001070154us-gaap:FinancialAssetAcquiredWithCreditDeteriorationMember2019-12-310001070154us-gaap:USStatesAndPoliticalSubdivisionsMemberus-gaap:ExternalCreditRatingNonInvestmentGradeMember2020-03-310001070154us-gaap:HeldtomaturitySecuritiesMember2020-03-310001070154us-gaap:HeldtomaturitySecuritiesMember2019-12-310001070154us-gaap:AvailableforsaleSecuritiesMember2020-03-310001070154us-gaap:AvailableforsaleSecuritiesMember2019-12-310001070154us-gaap:FinanceReceivablesMember2020-03-310001070154us-gaap:FinanceReceivablesMember2019-12-310001070154us-gaap:FinancialAssetAcquiredWithCreditDeteriorationMember2020-03-310001070154stl:SantanderBankN.AMember2019-11-292019-11-290001070154stl:EquipmentFinancingReceivablesMemberstl:SantanderBankN.AMember2019-11-290001070154stl:AssetBasedLendingMemberstl:SantanderBankN.AMember2019-11-290001070154stl:SantanderBankN.AMemberus-gaap:EstimateOfFairValueFairValueDisclosureMember2019-11-290001070154stl:SantanderBankN.AMember2019-11-290001070154stl:WoodforestNationalBankMember2019-02-282019-02-280001070154stl:WoodforestNationalBankMemberstl:EquipmentFinancingReceivablesMember2019-02-280001070154stl:WoodforestNationalBankMemberstl:AssetBasedLendingMember2019-02-280001070154stl:WoodforestNationalBankMemberus-gaap:EstimateOfFairValueFairValueDisclosureMember2019-02-280001070154stl:WoodforestNationalBankMember2019-02-280001070154us-gaap:AgencySecuritiesMember2020-03-310001070154us-gaap:CollateralizedMortgageObligationsMember2020-03-310001070154us-gaap:ResidentialMortgageBackedSecuritiesMember2020-03-310001070154us-gaap:USGovernmentAgenciesDebtSecuritiesMember2020-03-310001070154us-gaap:CorporateDebtSecuritiesMember2020-03-310001070154us-gaap:USStatesAndPoliticalSubdivisionsMember2020-03-310001070154stl:OtherInvestmentSecuritiesMember2020-03-310001070154us-gaap:SecuritiesInvestmentMember2020-03-310001070154us-gaap:AgencySecuritiesMember2019-12-310001070154us-gaap:CollateralizedMortgageObligationsMember2019-12-310001070154us-gaap:ResidentialMortgageBackedSecuritiesMember2019-12-310001070154us-gaap:USGovernmentAgenciesDebtSecuritiesMember2019-12-310001070154stl:OtherInvestmentSecuritiesMember2019-12-310001070154us-gaap:SecuritiesInvestmentMember2019-12-310001070154us-gaap:AccountingStandardsUpdate201712Member2019-01-01stl:security0001070154stl:CorporateDebtSecuritiesAndOtherInvestmentSecuritiesMember2019-12-310001070154stl:CumulativeEffectPeriodOfAdoptionAdjustmentMemberstl:CorporateDebtSecuritiesAndOtherInvestmentSecuritiesMember2019-12-310001070154us-gaap:USStatesAndPoliticalSubdivisionsMemberstl:CumulativeEffectPeriodOfAdoptionAdjustmentMember2019-12-310001070154stl:CorporateDebtSecuritiesAndOtherInvestmentSecuritiesMember2020-01-012020-03-310001070154us-gaap:USStatesAndPoliticalSubdivisionsMember2020-01-012020-03-310001070154stl:CorporateDebtSecuritiesAndOtherInvestmentSecuritiesMember2020-03-310001070154srt:FitchAAARatingMemberstl:CorporateDebtSecuritiesAndOtherInvestmentSecuritiesMember2020-03-310001070154us-gaap:USStatesAndPoliticalSubdivisionsMembersrt:FitchAAARatingMember2020-03-310001070154srt:FitchAARatingMemberstl:CorporateDebtSecuritiesAndOtherInvestmentSecuritiesMember2020-03-310001070154srt:FitchAARatingMemberus-gaap:USStatesAndPoliticalSubdivisionsMember2020-03-310001070154srt:FitchARatingMemberstl:CorporateDebtSecuritiesAndOtherInvestmentSecuritiesMember2020-03-310001070154srt:FitchARatingMemberus-gaap:USStatesAndPoliticalSubdivisionsMember2020-03-310001070154us-gaap:ExternalCreditRatingNonInvestmentGradeMemberstl:CorporateDebtSecuritiesAndOtherInvestmentSecuritiesMember2020-03-310001070154us-gaap:CollateralPledgedMemberus-gaap:FederalHomeLoanBankBorrowingsMember2020-03-310001070154us-gaap:CollateralPledgedMemberus-gaap:FederalHomeLoanBankBorrowingsMember2019-12-310001070154us-gaap:CollateralPledgedMemberstl:MunicipalDepositsMember2020-03-310001070154us-gaap:CollateralPledgedMemberstl:MunicipalDepositsMember2019-12-310001070154us-gaap:CollateralPledgedMember2020-03-310001070154us-gaap:CollateralPledgedMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:CommercialAndIndustrialMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:CommercialAndIndustrialMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:AssetBasedLendingMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:AssetBasedLendingMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:PayrollFinanceMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:PayrollFinanceMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:WarehouseLendingMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:WarehouseLendingMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:FactoredReceivablesMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:FactoredReceivablesMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:EquipmentFinancingReceivablesMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:EquipmentFinancingReceivablesMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:PublicSectorFinanceMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:PublicSectorFinanceMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberus-gaap:CommercialRealEstateMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberus-gaap:CommercialRealEstateMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberus-gaap:RealEstateLoanMembersrt:MultifamilyMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberus-gaap:RealEstateLoanMembersrt:MultifamilyMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberstl:AcquisitionDevelopmentAndConstructionMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberstl:AcquisitionDevelopmentAndConstructionMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMember2019-12-310001070154us-gaap:ResidentialMortgageMemberus-gaap:ResidentialPortfolioSegmentMember2020-03-310001070154us-gaap:ConsumerLoanMemberus-gaap:ConsumerPortfolioSegmentMember2020-03-3100010701542019-01-012019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:CommercialAndIndustrialMemberus-gaap:FinancingReceivables30To59DaysPastDueMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:FinancingReceivables60To89DaysPastDueMemberus-gaap:CommercialPortfolioSegmentMemberstl:CommercialAndIndustrialMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:CommercialAndIndustrialMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:AssetBasedLendingMemberus-gaap:FinancingReceivables30To59DaysPastDueMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:FinancingReceivables60To89DaysPastDueMemberus-gaap:CommercialPortfolioSegmentMemberstl:AssetBasedLendingMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:AssetBasedLendingMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:PayrollFinanceMemberus-gaap:FinancingReceivables30To59DaysPastDueMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:FinancingReceivables60To89DaysPastDueMemberus-gaap:CommercialPortfolioSegmentMemberstl:PayrollFinanceMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:PayrollFinanceMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:WarehouseLendingMemberus-gaap:FinancingReceivables30To59DaysPastDueMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:FinancingReceivables60To89DaysPastDueMemberus-gaap:CommercialPortfolioSegmentMemberstl:WarehouseLendingMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:WarehouseLendingMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:FactoredReceivablesMemberus-gaap:FinancingReceivables30To59DaysPastDueMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:FinancingReceivables60To89DaysPastDueMemberus-gaap:CommercialPortfolioSegmentMemberstl:FactoredReceivablesMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:FactoredReceivablesMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:EquipmentFinancingReceivablesMemberus-gaap:FinancingReceivables30To59DaysPastDueMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:FinancingReceivables60To89DaysPastDueMemberus-gaap:CommercialPortfolioSegmentMemberstl:EquipmentFinancingReceivablesMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:EquipmentFinancingReceivablesMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:PublicSectorFinanceMemberus-gaap:FinancingReceivables30To59DaysPastDueMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:FinancingReceivables60To89DaysPastDueMemberus-gaap:CommercialPortfolioSegmentMemberstl:PublicSectorFinanceMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:PublicSectorFinanceMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberus-gaap:CommercialRealEstateMemberus-gaap:FinancingReceivables30To59DaysPastDueMember2020-03-310001070154us-gaap:FinancingReceivables60To89DaysPastDueMemberus-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberus-gaap:CommercialRealEstateMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberus-gaap:CommercialRealEstateMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberus-gaap:RealEstateLoanMemberus-gaap:FinancingReceivables30To59DaysPastDueMembersrt:MultifamilyMember2020-03-310001070154us-gaap:FinancingReceivables60To89DaysPastDueMemberus-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberus-gaap:RealEstateLoanMembersrt:MultifamilyMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberus-gaap:RealEstateLoanMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMembersrt:MultifamilyMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberstl:AcquisitionDevelopmentAndConstructionMemberus-gaap:FinancingReceivables30To59DaysPastDueMember2020-03-310001070154us-gaap:FinancingReceivables60To89DaysPastDueMemberus-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberstl:AcquisitionDevelopmentAndConstructionMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberstl:AcquisitionDevelopmentAndConstructionMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMember2020-03-310001070154us-gaap:ResidentialMortgageMemberus-gaap:FinancingReceivables30To59DaysPastDueMemberus-gaap:ResidentialPortfolioSegmentMember2020-03-310001070154us-gaap:FinancingReceivables60To89DaysPastDueMemberus-gaap:ResidentialMortgageMemberus-gaap:ResidentialPortfolioSegmentMember2020-03-310001070154us-gaap:ResidentialMortgageMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberus-gaap:ResidentialPortfolioSegmentMember2020-03-310001070154us-gaap:ConsumerLoanMemberus-gaap:ConsumerPortfolioSegmentMemberus-gaap:FinancingReceivables30To59DaysPastDueMember2020-03-310001070154us-gaap:ConsumerLoanMemberus-gaap:FinancingReceivables60To89DaysPastDueMemberus-gaap:ConsumerPortfolioSegmentMember2020-03-310001070154us-gaap:ConsumerLoanMemberus-gaap:ConsumerPortfolioSegmentMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMember2020-03-310001070154us-gaap:FinancingReceivables30To59DaysPastDueMember2020-03-310001070154us-gaap:FinancingReceivables60To89DaysPastDueMember2020-03-310001070154us-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMember2020-03-310001070154us-gaap:NonperformingFinancingReceivableMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:CommercialAndIndustrialMemberus-gaap:FinancingReceivables30To59DaysPastDueMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:FinancingReceivables60To89DaysPastDueMemberus-gaap:CommercialPortfolioSegmentMemberstl:CommercialAndIndustrialMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:CommercialAndIndustrialMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:AssetBasedLendingMemberus-gaap:FinancingReceivables30To59DaysPastDueMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:FinancingReceivables60To89DaysPastDueMemberus-gaap:CommercialPortfolioSegmentMemberstl:AssetBasedLendingMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:AssetBasedLendingMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:PayrollFinanceMemberus-gaap:FinancingReceivables30To59DaysPastDueMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:FinancingReceivables60To89DaysPastDueMemberus-gaap:CommercialPortfolioSegmentMemberstl:PayrollFinanceMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:PayrollFinanceMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:WarehouseLendingMemberus-gaap:FinancingReceivables30To59DaysPastDueMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:FinancingReceivables60To89DaysPastDueMemberus-gaap:CommercialPortfolioSegmentMemberstl:WarehouseLendingMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:WarehouseLendingMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:FactoredReceivablesMemberus-gaap:FinancingReceivables30To59DaysPastDueMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:FinancingReceivables60To89DaysPastDueMemberus-gaap:CommercialPortfolioSegmentMemberstl:FactoredReceivablesMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:FactoredReceivablesMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:EquipmentFinancingReceivablesMemberus-gaap:FinancingReceivables30To59DaysPastDueMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:FinancingReceivables60To89DaysPastDueMemberus-gaap:CommercialPortfolioSegmentMemberstl:EquipmentFinancingReceivablesMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:EquipmentFinancingReceivablesMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:PublicSectorFinanceMemberus-gaap:FinancingReceivables30To59DaysPastDueMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:FinancingReceivables60To89DaysPastDueMemberus-gaap:CommercialPortfolioSegmentMemberstl:PublicSectorFinanceMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:PublicSectorFinanceMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberus-gaap:CommercialRealEstateMemberus-gaap:FinancingReceivables30To59DaysPastDueMember2019-12-310001070154us-gaap:FinancingReceivables60To89DaysPastDueMemberus-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberus-gaap:CommercialRealEstateMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberus-gaap:CommercialRealEstateMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberus-gaap:RealEstateLoanMemberus-gaap:FinancingReceivables30To59DaysPastDueMembersrt:MultifamilyMember2019-12-310001070154us-gaap:FinancingReceivables60To89DaysPastDueMemberus-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberus-gaap:RealEstateLoanMembersrt:MultifamilyMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberus-gaap:RealEstateLoanMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMembersrt:MultifamilyMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberstl:AcquisitionDevelopmentAndConstructionMemberus-gaap:FinancingReceivables30To59DaysPastDueMember2019-12-310001070154us-gaap:FinancingReceivables60To89DaysPastDueMemberus-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberstl:AcquisitionDevelopmentAndConstructionMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberstl:AcquisitionDevelopmentAndConstructionMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMember2019-12-310001070154us-gaap:ResidentialMortgageMemberus-gaap:FinancingReceivables30To59DaysPastDueMemberus-gaap:ResidentialPortfolioSegmentMember2019-12-310001070154us-gaap:FinancingReceivables60To89DaysPastDueMemberus-gaap:ResidentialMortgageMemberus-gaap:ResidentialPortfolioSegmentMember2019-12-310001070154us-gaap:ResidentialMortgageMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberus-gaap:ResidentialPortfolioSegmentMember2019-12-310001070154us-gaap:ConsumerLoanMemberus-gaap:ConsumerPortfolioSegmentMemberus-gaap:FinancingReceivables30To59DaysPastDueMember2019-12-310001070154us-gaap:ConsumerLoanMemberus-gaap:FinancingReceivables60To89DaysPastDueMemberus-gaap:ConsumerPortfolioSegmentMember2019-12-310001070154us-gaap:ConsumerLoanMemberus-gaap:ConsumerPortfolioSegmentMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMember2019-12-310001070154us-gaap:FinancingReceivables30To59DaysPastDueMember2019-12-310001070154us-gaap:FinancingReceivables60To89DaysPastDueMember2019-12-310001070154us-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMember2019-12-310001070154us-gaap:NonperformingFinancingReceivableMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:CommercialAndIndustrialMemberus-gaap:RealEstateMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154stl:BusinessAssetsMemberus-gaap:CommercialPortfolioSegmentMemberstl:CommercialAndIndustrialMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:CommercialAndIndustrialMemberus-gaap:EquipmentMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:CommercialAndIndustrialMemberstl:TaxiMedallionsMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:CollateralPledgedMemberstl:CommercialAndIndustrialMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:AssetBasedLendingMemberus-gaap:RealEstateMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154stl:BusinessAssetsMemberus-gaap:CommercialPortfolioSegmentMemberstl:AssetBasedLendingMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:AssetBasedLendingMemberus-gaap:EquipmentMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:AssetBasedLendingMemberstl:TaxiMedallionsMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:CollateralPledgedMemberstl:AssetBasedLendingMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:PayrollFinanceMemberus-gaap:RealEstateMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154stl:BusinessAssetsMemberus-gaap:CommercialPortfolioSegmentMemberstl:PayrollFinanceMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:PayrollFinanceMemberus-gaap:EquipmentMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:PayrollFinanceMemberstl:TaxiMedallionsMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:CollateralPledgedMemberstl:PayrollFinanceMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:EquipmentFinancingReceivablesMemberus-gaap:RealEstateMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154stl:BusinessAssetsMemberus-gaap:CommercialPortfolioSegmentMemberstl:EquipmentFinancingReceivablesMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:EquipmentFinancingReceivablesMemberus-gaap:EquipmentMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:EquipmentFinancingReceivablesMemberstl:TaxiMedallionsMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:CollateralPledgedMemberstl:EquipmentFinancingReceivablesMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberus-gaap:CommercialRealEstateMemberus-gaap:RealEstateMember2020-03-310001070154stl:BusinessAssetsMemberus-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberus-gaap:CommercialRealEstateMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberus-gaap:CommercialRealEstateMemberus-gaap:EquipmentMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberus-gaap:CommercialRealEstateMemberstl:TaxiMedallionsMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberus-gaap:CollateralPledgedMemberus-gaap:CommercialRealEstateMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberus-gaap:RealEstateLoanMemberus-gaap:RealEstateMembersrt:MultifamilyMember2020-03-310001070154stl:BusinessAssetsMemberus-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberus-gaap:RealEstateLoanMembersrt:MultifamilyMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberus-gaap:RealEstateLoanMemberus-gaap:EquipmentMembersrt:MultifamilyMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberus-gaap:RealEstateLoanMemberstl:TaxiMedallionsMembersrt:MultifamilyMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberus-gaap:CollateralPledgedMemberus-gaap:RealEstateLoanMembersrt:MultifamilyMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberstl:AcquisitionDevelopmentAndConstructionMemberus-gaap:RealEstateMember2020-03-310001070154stl:BusinessAssetsMemberus-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberstl:AcquisitionDevelopmentAndConstructionMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberstl:AcquisitionDevelopmentAndConstructionMemberus-gaap:EquipmentMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberstl:AcquisitionDevelopmentAndConstructionMemberstl:TaxiMedallionsMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberus-gaap:CollateralPledgedMemberstl:AcquisitionDevelopmentAndConstructionMember2020-03-310001070154us-gaap:ResidentialMortgageMemberus-gaap:ResidentialPortfolioSegmentMemberus-gaap:RealEstateMember2020-03-310001070154stl:BusinessAssetsMemberus-gaap:ResidentialMortgageMemberus-gaap:ResidentialPortfolioSegmentMember2020-03-310001070154us-gaap:ResidentialMortgageMemberus-gaap:EquipmentMemberus-gaap:ResidentialPortfolioSegmentMember2020-03-310001070154us-gaap:ResidentialMortgageMemberus-gaap:ResidentialPortfolioSegmentMemberstl:TaxiMedallionsMember2020-03-310001070154us-gaap:ResidentialMortgageMemberus-gaap:CollateralPledgedMemberus-gaap:ResidentialPortfolioSegmentMember2020-03-310001070154us-gaap:ConsumerLoanMemberus-gaap:ConsumerPortfolioSegmentMemberus-gaap:RealEstateMember2020-03-310001070154stl:BusinessAssetsMemberus-gaap:ConsumerLoanMemberus-gaap:ConsumerPortfolioSegmentMember2020-03-310001070154us-gaap:ConsumerLoanMemberus-gaap:ConsumerPortfolioSegmentMemberus-gaap:EquipmentMember2020-03-310001070154us-gaap:ConsumerLoanMemberus-gaap:ConsumerPortfolioSegmentMemberstl:TaxiMedallionsMember2020-03-310001070154us-gaap:ConsumerLoanMemberus-gaap:CollateralPledgedMemberus-gaap:ConsumerPortfolioSegmentMember2020-03-310001070154us-gaap:RealEstateMember2020-03-310001070154stl:BusinessAssetsMember2020-03-310001070154us-gaap:EquipmentMember2020-03-310001070154stl:TaxiMedallionsMember2020-03-310001070154us-gaap:NonperformingFinancingReceivableMemberus-gaap:CollateralPledgedMember2020-03-310001070154us-gaap:ResidentialMortgageMember2020-03-310001070154us-gaap:ResidentialMortgageMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:InterestIncomeMemberstl:CommercialAndIndustrialMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:AssetBasedLendingMemberus-gaap:InterestIncomeMemberus-gaap:CommercialAndIndustrialSectorMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberus-gaap:CommercialRealEstateMemberus-gaap:InterestIncomeMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberus-gaap:RealEstateLoanMemberus-gaap:InterestIncomeMembersrt:MultifamilyMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberus-gaap:InterestIncomeMemberstl:AcquisitionDevelopmentAndConstructionMember2020-03-310001070154us-gaap:ResidentialMortgageMemberus-gaap:InterestIncomeMemberus-gaap:ResidentialPortfolioSegmentMember2020-03-310001070154us-gaap:ConsumerLoanMemberus-gaap:InterestIncomeMemberus-gaap:ConsumerPortfolioSegmentMember2020-03-310001070154us-gaap:InterestIncomeMember2020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:FinancialAssetAcquiredWithCreditDeteriorationMemberstl:CommercialAndIndustrialMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:FinancialAssetAcquiredWithCreditDeteriorationMemberstl:AssetBasedLendingMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:FinancialAssetAcquiredWithCreditDeteriorationMemberstl:PayrollFinanceMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:FinancialAssetAcquiredWithCreditDeteriorationMemberstl:WarehouseLendingMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:FinancialAssetAcquiredWithCreditDeteriorationMemberstl:FactoredReceivablesMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:FinancialAssetAcquiredWithCreditDeteriorationMemberstl:EquipmentFinancingReceivablesMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:FinancialAssetAcquiredWithCreditDeteriorationMemberstl:PublicSectorFinanceMemberus-gaap:CommercialAndIndustrialSectorMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberus-gaap:FinancialAssetAcquiredWithCreditDeteriorationMemberus-gaap:CommercialRealEstateMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberus-gaap:FinancialAssetAcquiredWithCreditDeteriorationMemberus-gaap:RealEstateLoanMembersrt:MultifamilyMember2019-12-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberus-gaap:FinancialAssetAcquiredWithCreditDeteriorationMemberstl:AcquisitionDevelopmentAndConstructionMember2019-12-310001070154us-gaap:ResidentialMortgageMemberus-gaap:FinancialAssetAcquiredWithCreditDeteriorationMemberus-gaap:ResidentialPortfolioSegmentMember2019-12-310001070154us-gaap:ConsumerLoanMemberus-gaap:FinancialAssetAcquiredWithCreditDeteriorationMemberus-gaap:ConsumerPortfolioSegmentMember2019-12-310001070154us-gaap:FinancialAssetOtherThanFinancialAssetAcquiredWithCreditDeteriorationMember2020-03-310001070154us-gaap:FinancialAssetOtherThanFinancialAssetAcquiredWithCreditDeteriorationMember2019-12-31stl:loan0001070154us-gaap:CommercialPortfolioSegmentMemberstl:AssetBasedLendingMemberus-gaap:CommercialAndIndustrialSectorMember2020-01-012020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:AssetBasedLendingMemberus-gaap:CommercialAndIndustrialSectorMember2019-01-012019-03-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:EquipmentFinancingReceivablesMemberus-gaap:CommercialAndIndustrialSectorMember2020-01-012020-03-310001070154us-gaap:CommercialPortfolioSegmentMemberstl:EquipmentFinancingReceivablesMemberus-gaap:CommercialAndIndustrialSectorMember2019-01-012019-03-310001070154us-gaap:CommercialPortfolioSegmentMemberus-gaap:RealEstateSectorMemberus-gaap:CommercialRealEstateMember2020-01-012020-03-310001070154stl:CommercialAndIndustrialMember2019-12-310001070154stl:CumulativeEffectPeriodOfAdoptionAdjustmentMemberstl:CommercialAndIndustrialMember2019-12-310001070154stl:CommercialAndIndustrialMember2020-01-012020-03-310001070154stl:CommercialAndIndustrialMember2020-03-310001070154stl:AssetBasedLendingMember2019-12-310001070154stl:AssetBasedLendingMemberstl:CumulativeEffectPeriodOfAdoptionAdjustmentMember2019-12-310001070154stl:AssetBasedLendingMember2020-01-012020-03-310001070154stl:AssetBasedLendingMember2020-03-310001070154stl:PayrollFinanceMember2019-12-310001070154stl:CumulativeEffectPeriodOfAdoptionAdjustmentMemberstl:PayrollFinanceMember2019-12-310001070154stl:PayrollFinanceMember2020-01-012020-03-310001070154stl:PayrollFinanceMember2020-03-310001070154stl:WarehouseLendingMember2019-12-310001070154stl:WarehouseLendingMemberstl:CumulativeEffectPeriodOfAdoptionAdjustmentMember2019-12-310001070154stl:WarehouseLendingMember2020-01-012020-03-310001070154stl:WarehouseLendingMember2020-03-310001070154stl:FactoredReceivablesMember2019-12-310001070154stl:CumulativeEffectPeriodOfAdoptionAdjustmentMemberstl:FactoredReceivablesMember2019-12-310001070154stl:FactoredReceivablesMember2020-01-012020-03-310001070154stl:FactoredReceivablesMember2020-03-310001070154stl:EquipmentFinancingReceivablesMember2019-12-310001070154stl:EquipmentFinancingReceivablesMemberstl:CumulativeEffectPeriodOfAdoptionAdjustmentMember2019-12-310001070154stl:EquipmentFinancingReceivablesMember2020-01-012020-03-310001070154stl:EquipmentFinancingReceivablesMember2020-03-310001070154stl:PublicSectorFinanceMember2019-12-310001070154stl:PublicSectorFinanceMemberstl:CumulativeEffectPeriodOfAdoptionAdjustmentMember2019-12-310001070154stl:PublicSectorFinanceMember2020-01-012020-03-310001070154stl:PublicSectorFinanceMember2020-03-310001070154us-gaap:CommercialRealEstatePortfolioSegmentMember2019-12-310001070154us-gaap:CommercialRealEstatePortfolioSegmentMemberstl:CumulativeEffectPeriodOfAdoptionAdjustmentMember2019-12-310001070154us-gaap:CommercialRealEstatePortfolioSegmentMember2020-01-012020-03-310001070154us-gaap:CommercialRealEstatePortfolioSegmentMember2020-03-310001070154stl:MultifamilyfinancingMember2019-12-310001070154stl:CumulativeEffectPeriodOfAdoptionAdjustmentMemberstl:MultifamilyfinancingMember2019-12-310001070154stl:MultifamilyfinancingMember2020-01-012020-03-310001070154stl:MultifamilyfinancingMember2020-03-310001070154stl:AcquisitionDevelopmentAndConstructionMember2019-12-310001070154stl:CumulativeEffectPeriodOfAdoptionAdjustmentMemberstl:AcquisitionDevelopmentAndConstructionMember2019-12-310001070154stl:AcquisitionDevelopmentAndConstructionMember2020-01-012020-03-310001070154stl:AcquisitionDevelopmentAndConstructionMember2020-03-310001070154us-gaap:ResidentialMortgageMemberstl:CumulativeEffectPeriodOfAdoptionAdjustmentMember2019-12-310001070154us-gaap:ResidentialMortgageMember2020-01-012020-03-310001070154us-gaap:ConsumerLoanMember2019-12-310001070154us-gaap:ConsumerLoanMemberstl:CumulativeEffectPeriodOfAdoptionAdjustmentMember2019-12-310001070154us-gaap:ConsumerLoanMember2020-01-012020-03-310001070154us-gaap:ConsumerLoanMember2020-03-310001070154stl:CumulativeEffectPeriodOfAdoptionAdjustmentMember2019-12-310001070154stl:CommercialAndIndustrialMember2018-12-310001070154stl:CommercialAndIndustrialMember2019-01-012019-03-310001070154stl:CommercialAndIndustrialMember2019-03-310001070154stl:AssetBasedLendingMember2018-12-310001070154stl:AssetBasedLendingMember2019-01-012019-03-310001070154stl:AssetBasedLendingMember2019-03-310001070154stl:PayrollFinanceMember2018-12-310001070154stl:PayrollFinanceMember2019-01-012019-03-310001070154stl:PayrollFinanceMember2019-03-310001070154stl:WarehouseLendingMember2018-12-310001070154stl:WarehouseLendingMember2019-01-012019-03-310001070154stl:WarehouseLendingMember2019-03-310001070154stl:FactoredReceivablesMember2018-12-310001070154stl:FactoredReceivablesMember2019-01-012019-03-310001070154stl:FactoredReceivablesMember2019-03-310001070154stl:EquipmentFinancingReceivablesMember2018-12-310001070154stl:EquipmentFinancingReceivablesMember2019-01-012019-03-310001070154stl:EquipmentFinancingReceivablesMember2019-03-310001070154stl:PublicSectorFinanceMember2018-12-310001070154stl:PublicSectorFinanceMember2019-01-012019-03-310001070154stl:PublicSectorFinanceMember2019-03-310001070154us-gaap:CommercialRealEstatePortfolioSegmentMember2018-12-310001070154us-gaap:CommercialRealEstatePortfolioSegmentMember2019-01-012019-03-310001070154us-gaap:CommercialRealEstatePortfolioSegmentMember2019-03-310001070154stl:MultifamilyfinancingMember2018-12-310001070154stl:MultifamilyfinancingMember2019-01-012019-03-310001070154stl:MultifamilyfinancingMember2019-03-310001070154stl:AcquisitionDevelopmentAndConstructionMember2018-12-310001070154stl:AcquisitionDevelopmentAndConstructionMember2019-01-012019-03-310001070154stl:AcquisitionDevelopmentAndConstructionMember2019-03-310001070154us-gaap:ResidentialMortgageMember2018-12-310001070154us-gaap:ResidentialMortgageMember2019-01-012019-03-310001070154us-gaap:ResidentialMortgageMember2019-03-310001070154us-gaap:ConsumerLoanMember2018-12-310001070154us-gaap:ConsumerLoanMember2019-01-012019-03-310001070154us-gaap:ConsumerLoanMember2019-03-310001070154us-gaap:SpecialMentionMemberstl:CommercialAndIndustrialMember2020-03-310001070154us-gaap:SubstandardMemberstl:CommercialAndIndustrialMember2020-03-310001070154us-gaap:SpecialMentionMemberstl:CommercialAndIndustrialMember2019-12-310001070154us-gaap:SubstandardMemberstl:CommercialAndIndustrialMember2019-12-310001070154stl:AssetBasedLendingMemberus-gaap:SpecialMentionMember2020-03-310001070154us-gaap:SubstandardMemberstl:AssetBasedLendingMember2020-03-310001070154stl:AssetBasedLendingMemberus-gaap:SpecialMentionMember2019-12-310001070154us-gaap:SubstandardMemberstl:AssetBasedLendingMember2019-12-310001070154us-gaap:SpecialMentionMemberstl:PayrollFinanceMember2020-03-310001070154us-gaap:SubstandardMemberstl:PayrollFinanceMember2020-03-310001070154us-gaap:SpecialMentionMemberstl:PayrollFinanceMember2019-12-310001070154us-gaap:SubstandardMemberstl:PayrollFinanceMember2019-12-310001070154us-gaap:SpecialMentionMemberstl:FactoredReceivablesMember2020-03-310001070154us-gaap:SubstandardMemberstl:FactoredReceivablesMember2020-03-310001070154us-gaap:SpecialMentionMemberstl:FactoredReceivablesMember2019-12-310001070154us-gaap:SubstandardMemberstl:FactoredReceivablesMember2019-12-310001070154us-gaap:SpecialMentionMemberstl:EquipmentFinancingReceivablesMember2020-03-310001070154us-gaap:SubstandardMemberstl:EquipmentFinancingReceivablesMember2020-03-310001070154us-gaap:SpecialMentionMemberstl:EquipmentFinancingReceivablesMember2019-12-310001070154us-gaap:SubstandardMemberstl:EquipmentFinancingReceivablesMember2019-12-310001070154us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:SpecialMentionMember2020-03-310001070154us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:SubstandardMember2020-03-310001070154us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:SpecialMentionMember2019-12-310001070154us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:SubstandardMember2019-12-310001070154us-gaap:SpecialMentionMemberstl:MultifamilyfinancingMember2020-03-310001070154us-gaap:SubstandardMemberstl:MultifamilyfinancingMember2020-03-310001070154us-gaap:SpecialMentionMemberstl:MultifamilyfinancingMember2019-12-310001070154us-gaap:SubstandardMemberstl:MultifamilyfinancingMember2019-12-310001070154us-gaap:SpecialMentionMemberstl:AcquisitionDevelopmentAndConstructionMember2020-03-310001070154us-gaap:SubstandardMemberstl:AcquisitionDevelopmentAndConstructionMember2020-03-310001070154us-gaap:SpecialMentionMemberstl:AcquisitionDevelopmentAndConstructionMember2019-12-310001070154us-gaap:SubstandardMemberstl:AcquisitionDevelopmentAndConstructionMember2019-12-310001070154us-gaap:ResidentialMortgageMemberus-gaap:SpecialMentionMember2020-03-310001070154us-gaap:SubstandardMemberus-gaap:ResidentialMortgageMember2020-03-310001070154us-gaap:ResidentialMortgageMemberus-gaap:SpecialMentionMember2019-12-310001070154us-gaap:SubstandardMemberus-gaap:ResidentialMortgageMember2019-12-310001070154us-gaap:ConsumerLoanMemberus-gaap:SpecialMentionMember2020-03-310001070154us-gaap:ConsumerLoanMemberus-gaap:SubstandardMember2020-03-310001070154us-gaap:ConsumerLoanMemberus-gaap:SpecialMentionMember2019-12-310001070154us-gaap:ConsumerLoanMemberus-gaap:SubstandardMember2019-12-310001070154us-gaap:SpecialMentionMember2020-03-310001070154us-gaap:SubstandardMember2020-03-310001070154us-gaap:SpecialMentionMember2019-12-310001070154us-gaap:SubstandardMember2019-12-310001070154us-gaap:UnlikelyToBeCollectedFinancingReceivableMember2020-03-310001070154us-gaap:UnlikelyToBeCollectedFinancingReceivableMember2019-12-310001070154us-gaap:DoubtfulMember2020-03-310001070154us-gaap:DoubtfulMember2019-12-310001070154us-gaap:PassMemberstl:CommercialAndIndustrialMember2020-03-310001070154stl:AssetBasedLendingMemberus-gaap:PassMember2020-03-310001070154stl:PayrollFinanceMemberus-gaap:PassMember2020-03-310001070154stl:WarehouseLendingMemberus-gaap:PassMember2020-03-310001070154stl:WarehouseLendingMemberus-gaap:SpecialMentionMember2020-03-310001070154us-gaap:SubstandardMemberstl:WarehouseLendingMember2020-03-310001070154us-gaap:PassMemberstl:FactoredReceivablesMember2020-03-310001070154stl:EquipmentFinancingReceivablesMemberus-gaap:PassMember2020-03-310001070154stl:PublicSectorFinanceMemberus-gaap:PassMember2020-03-310001070154us-gaap:SpecialMentionMemberstl:PublicSectorFinanceMember2020-03-310001070154us-gaap:SubstandardMemberstl:PublicSectorFinanceMember2020-03-310001070154us-gaap:CommercialRealEstatePortfolioSegmentMemberus-gaap:PassMember2020-03-310001070154us-gaap:PassMemberstl:MultifamilyfinancingMember2020-03-310001070154us-gaap:PassMemberstl:AcquisitionDevelopmentAndConstructionMember2020-03-310001070154us-gaap:ResidentialMortgageMemberus-gaap:PassMember2020-03-310001070154us-gaap:ConsumerLoanMemberus-gaap:PassMember2020-03-310001070154us-gaap:CoreDepositsMember2020-03-310001070154us-gaap:CoreDepositsMember2019-12-310001070154us-gaap:CustomerListsMember2020-03-310001070154us-gaap:CustomerListsMember2019-12-310001070154us-gaap:TradeNamesMember2020-03-310001070154us-gaap:TradeNamesMember2019-12-310001070154us-gaap:InterestBearingDepositsMember2020-03-310001070154us-gaap:InterestBearingDepositsMember2019-12-310001070154stl:MoneyMarketDepositsMember2020-03-310001070154stl:MoneyMarketDepositsMember2019-12-310001070154us-gaap:CertificatesOfDepositMember2020-03-310001070154us-gaap:CertificatesOfDepositMember2019-12-310001070154us-gaap:FederalHomeLoanBankAdvancesMember2020-03-310001070154us-gaap:FederalHomeLoanBankAdvancesMember2019-12-310001070154us-gaap:FederalFundsPurchasedAndSecuritiesSoldUnderAgreementsToRepurchaseMember2020-03-310001070154us-gaap:FederalFundsPurchasedAndSecuritiesSoldUnderAgreementsToRepurchaseMember2019-12-310001070154stl:SeniorNotes3.50Memberus-gaap:SeniorNotesMember2020-03-310001070154stl:SeniorNotes3.50Memberus-gaap:SeniorNotesMember2019-12-310001070154us-gaap:SubordinatedDebtMembersrt:ParentCompanyMember2020-03-310001070154us-gaap:SubordinatedDebtMembersrt:ParentCompanyMember2019-12-310001070154srt:SubsidiariesMemberus-gaap:SubordinatedDebtMember2020-03-310001070154srt:SubsidiariesMemberus-gaap:SubordinatedDebtMember2019-12-310001070154us-gaap:OtherAssetsMemberstl:ThirdPartyInterestRateSwapMember2020-03-310001070154us-gaap:OtherAssetsMemberstl:CustomerInterestRateSwapMember2020-03-310001070154us-gaap:OtherAssetsMemberus-gaap:InterestRateSwapMember2020-03-310001070154us-gaap:OtherAssetsMember2020-01-012020-03-310001070154us-gaap:OtherAssetsMember2020-03-310001070154us-gaap:LondonInterbankOfferedRateLIBORMemberus-gaap:OtherAssetsMemberus-gaap:InterestRateSwapMember2020-03-310001070154us-gaap:OtherLiabilitiesMemberstl:ThirdPartyInterestRateSwapMember2020-03-310001070154us-gaap:OtherLiabilitiesMemberstl:CustomerInterestRateSwapMember2020-03-310001070154us-gaap:OtherLiabilitiesMemberus-gaap:InterestRateSwapMember2020-03-310001070154us-gaap:OtherLiabilitiesMember2020-01-012020-03-310001070154us-gaap:OtherLiabilitiesMember2020-03-310001070154us-gaap:OtherLiabilitiesMemberus-gaap:LondonInterbankOfferedRateLIBORMemberus-gaap:InterestRateSwapMember2020-03-310001070154us-gaap:OtherAssetsMemberstl:ThirdPartyInterestRateSwapMember2019-12-310001070154us-gaap:OtherAssetsMemberstl:CustomerInterestRateSwapMember2019-12-310001070154us-gaap:OtherAssetsMemberus-gaap:InterestRateSwapMember2019-12-310001070154us-gaap:OtherAssetsMember2019-01-012019-03-310001070154us-gaap:OtherAssetsMember2019-12-310001070154us-gaap:LondonInterbankOfferedRateLIBORMemberus-gaap:OtherAssetsMemberstl:ThirdPartyInterestRateSwapMember2019-12-310001070154us-gaap:OtherLiabilitiesMemberstl:ThirdPartyInterestRateSwapMember2019-12-310001070154us-gaap:OtherLiabilitiesMemberstl:CustomerInterestRateSwapMember2019-12-310001070154us-gaap:OtherLiabilitiesMemberus-gaap:InterestRateSwapMember2019-12-310001070154us-gaap:OtherLiabilitiesMember2019-01-012019-03-310001070154us-gaap:OtherLiabilitiesMember2019-12-310001070154us-gaap:OtherLiabilitiesMemberus-gaap:LondonInterbankOfferedRateLIBORMemberstl:CustomerInterestRateSwapMember2019-12-310001070154stl:RecognitionAndRetentionPlanMemberstl:NonvestedStockAwardsandPerformanceUnitsMember2019-12-310001070154stl:RecognitionAndRetentionPlanMemberstl:NonvestedStockAwardsandPerformanceUnitsMember2020-01-012020-03-310001070154stl:RecognitionAndRetentionPlanMemberstl:NonvestedStockAwardsandPerformanceUnitsMember2020-03-310001070154stl:February2016Memberus-gaap:PerformanceSharesMember2020-01-012020-03-310001070154us-gaap:EmployeeStockOptionMember2020-01-012020-03-310001070154us-gaap:EmployeeStockOptionMember2019-01-012019-03-310001070154stl:NonvestedStockAwardsandPerformanceUnitsMember2020-01-012020-03-310001070154stl:NonvestedStockAwardsandPerformanceUnitsMember2019-01-012019-03-310001070154us-gaap:InterestRateSwapMember2020-03-310001070154us-gaap:InterestRateSwapMember2019-12-310001070154srt:SubsidiariesMemberstl:SterlingNationalBankMember2020-03-310001070154stl:SterlingNationalBankMembersrt:ParentCompanyMember2020-03-310001070154us-gaap:LoanOriginationCommitmentsMember2020-03-310001070154us-gaap:LoanOriginationCommitmentsMember2019-12-310001070154us-gaap:UnusedLinesOfCreditMember2020-03-310001070154us-gaap:UnusedLinesOfCreditMember2019-12-310001070154us-gaap:LetterOfCreditMember2020-03-310001070154us-gaap:LetterOfCreditMember2019-12-310001070154us-gaap:AgencySecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2020-03-310001070154us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:AgencySecuritiesMember2020-03-310001070154us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:AgencySecuritiesMember2020-03-310001070154us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:AgencySecuritiesMember2020-03-310001070154us-gaap:FairValueMeasurementsRecurringMemberus-gaap:CollateralizedMortgageObligationsMember2020-03-310001070154us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:CollateralizedMortgageObligationsMember2020-03-310001070154us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:CollateralizedMortgageObligationsMember2020-03-310001070154us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:CollateralizedMortgageObligationsMember2020-03-310001070154us-gaap:ResidentialMortgageBackedSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2020-03-310001070154us-gaap:FairValueInputsLevel1Memberus-gaap:ResidentialMortgageBackedSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2020-03-310001070154us-gaap:FairValueInputsLevel2Memberus-gaap:ResidentialMortgageBackedSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2020-03-310001070154us-gaap:FairValueInputsLevel3Memberus-gaap:ResidentialMortgageBackedSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2020-03-310001070154us-gaap:USGovernmentAgenciesDebtSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2020-03-310001070154us-gaap:USGovernmentAgenciesDebtSecuritiesMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2020-03-310001070154us-gaap:USGovernmentAgenciesDebtSecuritiesMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2020-03-310001070154us-gaap:USGovernmentAgenciesDebtSecuritiesMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2020-03-310001070154us-gaap:CorporateDebtSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2020-03-310001070154us-gaap:CorporateDebtSecuritiesMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2020-03-310001070154us-gaap:CorporateDebtSecuritiesMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2020-03-310001070154us-gaap:CorporateDebtSecuritiesMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2020-03-310001070154us-gaap:USStatesAndPoliticalSubdivisionsMemberus-gaap:FairValueMeasurementsRecurringMember2020-03-310001070154us-gaap:FairValueInputsLevel1Memberus-gaap:USStatesAndPoliticalSubdivisionsMemberus-gaap:FairValueMeasurementsRecurringMember2020-03-310001070154us-gaap:USStatesAndPoliticalSubdivisionsMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2020-03-310001070154us-gaap:FairValueInputsLevel3Memberus-gaap:USStatesAndPoliticalSubdivisionsMemberus-gaap:FairValueMeasurementsRecurringMember2020-03-310001070154us-gaap:FairValueMeasurementsRecurringMemberus-gaap:SecuritiesInvestmentMember2020-03-310001070154us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:SecuritiesInvestmentMember2020-03-310001070154us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:SecuritiesInvestmentMember2020-03-310001070154us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:SecuritiesInvestmentMember2020-03-310001070154us-gaap:FairValueMeasurementsRecurringMember2020-03-310001070154us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2020-03-310001070154us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2020-03-310001070154us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2020-03-310001070154us-gaap:AgencySecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001070154us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:AgencySecuritiesMember2019-12-310001070154us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:AgencySecuritiesMember2019-12-310001070154us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:AgencySecuritiesMember2019-12-310001070154us-gaap:FairValueMeasurementsRecurringMemberus-gaap:CollateralizedMortgageObligationsMember2019-12-310001070154us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:CollateralizedMortgageObligationsMember2019-12-310001070154us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:CollateralizedMortgageObligationsMember2019-12-310001070154us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:CollateralizedMortgageObligationsMember2019-12-310001070154us-gaap:ResidentialMortgageBackedSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001070154us-gaap:FairValueInputsLevel1Memberus-gaap:ResidentialMortgageBackedSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001070154us-gaap:FairValueInputsLevel2Memberus-gaap:ResidentialMortgageBackedSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001070154us-gaap:FairValueInputsLevel3Memberus-gaap:ResidentialMortgageBackedSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001070154us-gaap:USGovernmentAgenciesDebtSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001070154us-gaap:USGovernmentAgenciesDebtSecuritiesMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001070154us-gaap:USGovernmentAgenciesDebtSecuritiesMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001070154us-gaap:USGovernmentAgenciesDebtSecuritiesMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001070154us-gaap:CorporateDebtSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001070154us-gaap:CorporateDebtSecuritiesMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001070154us-gaap:CorporateDebtSecuritiesMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001070154us-gaap:CorporateDebtSecuritiesMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001070154us-gaap:USStatesAndPoliticalSubdivisionsMemberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001070154us-gaap:FairValueInputsLevel1Memberus-gaap:USStatesAndPoliticalSubdivisionsMemberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001070154us-gaap:USStatesAndPoliticalSubdivisionsMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001070154us-gaap:FairValueInputsLevel3Memberus-gaap:USStatesAndPoliticalSubdivisionsMemberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001070154us-gaap:FairValueMeasurementsRecurringMemberus-gaap:SecuritiesInvestmentMember2019-12-310001070154us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:SecuritiesInvestmentMember2019-12-310001070154us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:SecuritiesInvestmentMember2019-12-310001070154us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:SecuritiesInvestmentMember2019-12-310001070154us-gaap:FairValueMeasurementsRecurringMember2019-12-310001070154us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001070154us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001070154us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001070154srt:MinimumMemberus-gaap:MeasurementInputAppraisedValueMember2020-03-310001070154srt:MaximumMemberus-gaap:MeasurementInputAppraisedValueMember2020-03-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberstl:CommercialAndIndustrialMember2020-03-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel1Memberstl:CommercialAndIndustrialMember2020-03-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel2Memberstl:CommercialAndIndustrialMember2020-03-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel3Memberstl:CommercialAndIndustrialMember2020-03-310001070154stl:AssetBasedLendingMemberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMember2020-03-310001070154stl:AssetBasedLendingMemberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel1Member2020-03-310001070154stl:AssetBasedLendingMemberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel2Member2020-03-310001070154stl:AssetBasedLendingMemberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel3Member2020-03-310001070154stl:EquipmentFinancingReceivablesMemberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMember2020-03-310001070154stl:EquipmentFinancingReceivablesMemberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel1Member2020-03-310001070154stl:EquipmentFinancingReceivablesMemberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel2Member2020-03-310001070154stl:EquipmentFinancingReceivablesMemberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel3Member2020-03-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:CommercialRealEstateMember2020-03-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel1Memberus-gaap:CommercialRealEstateMember2020-03-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:CommercialRealEstateMemberus-gaap:FairValueInputsLevel2Member2020-03-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel3Memberus-gaap:CommercialRealEstateMember2020-03-310001070154stl:RealEstateCommercialMortgageCblMemberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMember2020-03-310001070154stl:RealEstateCommercialMortgageCblMemberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel1Member2020-03-310001070154stl:RealEstateCommercialMortgageCblMemberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel2Member2020-03-310001070154stl:RealEstateCommercialMortgageCblMemberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel3Member2020-03-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:ResidentialMortgageMember2020-03-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel1Memberus-gaap:ResidentialMortgageMember2020-03-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel2Memberus-gaap:ResidentialMortgageMember2020-03-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel3Memberus-gaap:ResidentialMortgageMember2020-03-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:ConsumerLoanMember2020-03-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel1Memberus-gaap:ConsumerLoanMember2020-03-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel2Memberus-gaap:ConsumerLoanMember2020-03-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel3Memberus-gaap:ConsumerLoanMember2020-03-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMember2020-03-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel1Member2020-03-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel2Member2020-03-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel3Member2020-03-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel3Member2019-12-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberstl:CommercialAndIndustrialMember2019-12-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel1Memberstl:CommercialAndIndustrialMember2019-12-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel2Memberstl:CommercialAndIndustrialMember2019-12-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel3Memberstl:CommercialAndIndustrialMember2019-12-310001070154stl:AssetBasedLendingMemberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMember2019-12-310001070154stl:AssetBasedLendingMemberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel1Member2019-12-310001070154stl:AssetBasedLendingMemberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel2Member2019-12-310001070154stl:AssetBasedLendingMemberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel3Member2019-12-310001070154stl:EquipmentFinancingReceivablesMemberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMember2019-12-310001070154stl:EquipmentFinancingReceivablesMemberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel1Member2019-12-310001070154stl:EquipmentFinancingReceivablesMemberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel2Member2019-12-310001070154stl:EquipmentFinancingReceivablesMemberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel3Member2019-12-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:CommercialRealEstateMember2019-12-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel1Memberus-gaap:CommercialRealEstateMember2019-12-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:CommercialRealEstateMemberus-gaap:FairValueInputsLevel2Member2019-12-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel3Memberus-gaap:CommercialRealEstateMember2019-12-310001070154stl:RealEstateCommercialMortgageCblMemberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMember2019-12-310001070154stl:RealEstateCommercialMortgageCblMemberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel1Member2019-12-310001070154stl:RealEstateCommercialMortgageCblMemberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel2Member2019-12-310001070154stl:RealEstateCommercialMortgageCblMemberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel3Member2019-12-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:ResidentialMortgageMember2019-12-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel1Memberus-gaap:ResidentialMortgageMember2019-12-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel2Memberus-gaap:ResidentialMortgageMember2019-12-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel3Memberus-gaap:ResidentialMortgageMember2019-12-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:ConsumerLoanMember2019-12-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel1Memberus-gaap:ConsumerLoanMember2019-12-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel2Memberus-gaap:ConsumerLoanMember2019-12-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel3Memberus-gaap:ConsumerLoanMember2019-12-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMember2019-12-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel1Member2019-12-310001070154us-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:CollateralPledgedMemberus-gaap:FairValueInputsLevel2Member2019-12-310001070154us-gaap:CarryingReportedAmountFairValueDisclosureMember2020-03-310001070154us-gaap:FairValueInputsLevel1Member2020-03-310001070154us-gaap:FairValueInputsLevel2Member2020-03-310001070154us-gaap:FairValueInputsLevel3Member2020-03-310001070154us-gaap:CarryingReportedAmountFairValueDisclosureMembersrt:ParentCompanyMember2020-03-310001070154us-gaap:FairValueInputsLevel1Membersrt:ParentCompanyMember2020-03-310001070154us-gaap:FairValueInputsLevel2Membersrt:ParentCompanyMember2020-03-310001070154us-gaap:FairValueInputsLevel3Membersrt:ParentCompanyMember2020-03-310001070154srt:SubsidiariesMemberus-gaap:CarryingReportedAmountFairValueDisclosureMember2020-03-310001070154srt:SubsidiariesMemberus-gaap:FairValueInputsLevel1Member2020-03-310001070154srt:SubsidiariesMemberus-gaap:FairValueInputsLevel2Member2020-03-310001070154srt:SubsidiariesMemberus-gaap:FairValueInputsLevel3Member2020-03-310001070154us-gaap:CarryingReportedAmountFairValueDisclosureMember2019-12-310001070154us-gaap:FairValueInputsLevel1Member2019-12-310001070154us-gaap:FairValueInputsLevel2Member2019-12-310001070154us-gaap:FairValueInputsLevel3Member2019-12-310001070154us-gaap:AvailableforsaleSecuritiesMemberus-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember2020-01-012020-03-310001070154us-gaap:AvailableforsaleSecuritiesMemberus-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember2019-01-012019-03-310001070154us-gaap:HeldtomaturitySecuritiesMemberus-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember2020-01-012020-03-310001070154us-gaap:HeldtomaturitySecuritiesMemberus-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember2019-01-012019-03-310001070154us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2020-01-012020-03-310001070154us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2019-01-012019-03-310001070154us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember2019-12-310001070154stl:NetUnrealizedHoldingGainLossOnSecuritiesTransferredToHeldtomaturityMember2019-12-310001070154us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2019-12-310001070154us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember2020-01-012020-03-310001070154stl:NetUnrealizedHoldingGainLossOnSecuritiesTransferredToHeldtomaturityMember2020-01-012020-03-310001070154us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember2020-03-310001070154stl:NetUnrealizedHoldingGainLossOnSecuritiesTransferredToHeldtomaturityMember2020-03-310001070154us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2020-03-310001070154us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember2018-12-310001070154stl:NetUnrealizedHoldingGainLossOnSecuritiesTransferredToHeldtomaturityMember2018-12-310001070154us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2018-12-310001070154us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember2019-01-012019-03-310001070154stl:NetUnrealizedHoldingGainLossOnSecuritiesTransferredToHeldtomaturityMember2019-01-012019-03-310001070154us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember2019-03-310001070154stl:NetUnrealizedHoldingGainLossOnSecuritiesTransferredToHeldtomaturityMember2019-03-310001070154us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2019-03-31

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________________________ 
FORM 10-Q
______________________________ 
☒QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2020
☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Commission File Number: 001-35385
______________________________ 
STERLING BANCORP
(Exact Name of Registrant as Specified in its Charter)
______________________________ 
Delaware 80-0091851
(State or Other Jurisdiction of (IRS Employer ID No.)
Incorporation or Organization) 
400 Rella Boulevard, 
Montebello,New York10901
(Address of Principal Executive Office) (Zip Code)
(845) 369-8040
(Registrant’s Telephone Number including area code)
______________________________
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, par value $0.01 per shareSTLNew York Stock Exchange
Depositary Shares, each representing 1/40 interest in a share of 6.50% Non-Cumulative Perpetual Preferred Stock, Series ASTLPRANew York Stock Exchange
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 twelve months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes  ☒    No  ☐
Indicate by check mark whether the registrant has submitted electronically, if any, every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes  ☒    No  ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer    ☒ Accelerated filer    ☐
Non-accelerated filer    ☐ Smaller reporting company ☐
Emerging growth company  ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes  ☐    No  ☒
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
Classes of Common Stock  Shares outstanding as of May 1, 2020
$0.01 per share  194,455,424



STERLING BANCORP AND SUBSIDIARIES
FORM 10-Q TABLE OF CONTENTS
QUARTERLY PERIOD ENDED MARCH 31, 2020
 
PART I. FINANCIAL INFORMATION - UNAUDITED
Item 1.
Item 2.
Item 3.
Item 4.
PART II. OTHER INFORMATION
Item 1.
Item 1A.
Item 2.
Item 3.
Item 4.
Item 5.
Item 6.


Table of Contents
Part I - FINANCIAL INFORMATION
Item 1. Financial Statements
STERLING BANCORP AND SUBSIDIARIES
Consolidated Balance Sheets (Unaudited)
(Dollars in thousands, except share and per share data)



 March 31,December 31,
20202019
ASSETS:
Cash and due from banks$348,636  $329,151  
Securities available for sale, at estimated fair value
2,660,835  3,095,648  
Securities held to maturity (“HTM”), (net of allowance for credit losses of $2,499 at March 31, 2020)
1,953,678  1,979,661  
Loans held for sale8,124  8,125  
Portfolio loans 21,709,957  21,440,212  
Allowance for credit losses - loans
(326,444) (106,238) 
Portfolio loans, net21,383,513  21,333,974  
Federal Home Loan Bank (“FHLB”) and Federal Reserve Bank (“FRB”) stock, at cost
240,722  251,805  
Accrued interest receivable 102,101  100,312  
Premises and equipment, net 228,526  227,070  
Goodwill 1,683,482  1,683,482  
Other intangible assets, net 106,164  110,364  
Bank owned life insurance (“BOLI”)616,648  613,848  
Other real estate owned11,815  12,189  
Other assets 990,792  840,868  
Total assets$30,335,036  $30,586,497  
LIABILITIES AND STOCKHOLDERS’ EQUITY
LIABILITIES:
Deposits$22,558,280  $22,418,658  
FHLB borrowings 1,955,451  2,245,653  
Repurchase agreements27,562  22,678  
Senior Notes171,422  173,504  
Subordinated Notes - Bank173,244  173,182  
Subordinated Notes - Company271,019  270,941  
Mortgage escrow funds 96,491  58,316  
Other liabilities659,143  693,452  
Total liabilities25,912,612  26,056,384  
Commitments and Contingent liabilities (See Note 15. “Commitments and Contingencies”)
STOCKHOLDERS’ EQUITY:
Preferred stock (par value $0.01 per share; 10,000,000 shares authorized; 135,000 shares issued and outstanding at March 31, 2020 and December 31, 2019)
137,363  137,581  
Common stock (par value $0.01 per share; 310,000,000 shares authorized at March 31, 2020 and December 31, 2019; 229,872,925 shares issued at March 31, 2020 and December 31, 2019; 194,460,656 and 198,455,324 shares outstanding at March 31, 2020 and December 31, 2019, respectively)
2,299  2,299  
Additional paid-in capital3,749,508  3,766,716  
Treasury stock, at cost (35,412,268 shares at March 31, 2020 and 31,417,601 shares at December 31, 2019)
(660,069) (583,408) 
Retained earnings1,125,702  1,166,709  
Accumulated other comprehensive income, net of tax expense of $25,830 at March 31, 2020 and $15,361 at December 31, 2019
67,621  40,216  
Total stockholders’ equity4,422,424  4,530,113  
Total liabilities and stockholders’ equity$30,335,036  $30,586,497  
See accompanying notes to consolidated financial statements.
3
Table of Contents
STERLING BANCORP AND SUBSIDIARIES
Consolidated Income Statements (Unaudited)
(Dollars in thousands, except share and per share data)


Three months ended
March 31,
20202019
Interest and dividend income:
Loans and loan fees$235,439  $260,295  
Securities taxable20,629  27,847  
Securities non-taxable12,997  14,857  
Other earning assets4,462  6,401  
Total interest and dividend income273,527  309,400  
Interest expense:
Deposits45,781  45,995  
Borrowings15,974  27,899  
Total interest expense61,755  73,894  
Net interest income211,772  235,506  
Provision for credit losses - loans136,577  10,200  
Provision for credit losses - held to maturity securities1,703  —  
Net interest income after provision for credit losses73,492  225,306  
Non-interest income:
Deposit fees and service charges6,622  6,212  
Accounts receivable management / factoring commissions and other fees5,538  5,423  
Bank owned life insurance5,018  3,641  
Loan commissions and fees11,024  3,838  
Investment management fees1,847  1,900  
Net gain (loss) on sale of securities8,412  (13,184) 
Net gain on called securities4,880  —  
Gain on sale of residential mortgage loans—  8,313  
Other3,985  3,454  
Total non-interest income47,326  19,597  
Non-interest expense:
Compensation and benefits54,876  55,990  
Stock-based compensation plans6,006  5,123  
Occupancy and office operations15,199  16,535  
Information technology8,018  8,675  
Amortization of intangible assets4,200  4,826  
FDIC insurance and regulatory assessments3,206  3,338  
Other real estate owned expense, net52  217  
Charge for asset write-downs, retention and severance—  3,344  
Other23,156  16,944  
Total non-interest expense114,713  114,992  
Income before income tax expense6,105  129,911  
Income tax (benefit) expense(8,042) 28,474  
Net income14,147  101,437  
Preferred stock dividend1,976  1,989  
Net income available to common stockholders$12,171  $99,448  
Weighted average common shares:
Basic196,344,061  213,157,090  
Diluted196,709,038  213,505,842  
Earnings per common share:
Basic$0.06  $0.47  
Diluted0.06  0.47  
See accompanying notes to consolidated financial statements.
4
Table of Contents
STERLING BANCORP AND SUBSIDIARIES
Consolidated Statements of Comprehensive Income (Unaudited)
(Dollars in thousands)

Three months ended
March 31,
20202019
Net income$14,147  $101,437  
Other comprehensive income (loss), before tax:
Change in unrealized holding gains on securities available for sale
48,755  75,329  
Unrealized loss on transfer of securities held to maturity to available for sale
—  (11,813) 
Reclassification adjustment for net realized (gains) losses included in net income
(8,412) 13,184  
Accretion of net unrealized loss on securities transferred to held to maturity
97  2,417  
Change in the actuarial loss of defined benefit plan and post-retirement benefit plans
(2,568) 2,883  
Total other comprehensive income, before tax37,872  82,000  
Deferred tax (expense) related to other comprehensive income(10,467) (22,665) 
Other comprehensive income, net of tax27,405  59,335  
Comprehensive income$41,552  $160,772  
See accompanying notes to consolidated financial statements.
5
Table of Contents
STERLING BANCORP AND SUBSIDIARIES
Consolidated Statements of Changes in Stockholders’ Equity (Unaudited)
(Dollars in thousands, except share and per share data)


Number of common
shares		Preferred stockCommon
stock		Additional
paid-in
capital		Treasury
stock		Retained
earnings		Accumulated
other
comprehensive
(loss) income 		Total
stockholders’
equity
Balance at January 1, 2019216,227,852  $138,423  $2,299  $3,776,461  $(213,935) $791,550  $(65,945) $4,428,853  
Net income—  —  —  —  —  101,437  —  101,437  
Other comprehensive income—  —  —  —  —  —  59,335  59,335  
Stock options & other stock transactions, net3,893  —  —  —  49  6  —  55  
Restricted stock awards, net
1,331,674  —  —  (24,626) 12,818  12,913  —  1,105  
Cash dividends declared ($0.07 per common share)
—  —  —  —  —  (15,079) —  (15,079) 
Cash dividends declared ($16.25 per preferred share)
—  (205) —  —  —  (1,989) —  (2,194) 
Purchase of treasury stock
(8,002,595) —  —  —  (154,289) —  —  (154,289) 
Balance at March 31, 2019209,560,824  $138,218  $2,299  3,751,835  $(355,357) $888,838  $(6,610) $4,419,223  

Number of common
shares		Preferred
stock		Common
stock		Additional
paid-in
capital		Treasury
stock		Retained
earnings		Accumulated
other
comprehensive
income 		Total
stockholders’
equity
Balance at January 1, 2020198,455,324  $137,581  $2,299  $3,766,716  $(583,408) $1,166,709  $40,216  $4,530,113  
Cumulative effect of change in accounting principle (see Note 1. “Basis of Financial Statement Presentation”)
—  —  —  —  —  (54,254) —  (54,254) 
Balance at January 1, 2020 (as adjusted for change in accounting principle)
198,455,324  137,581  2,299  3,766,716  (583,408) 1,112,455  40,216  4,475,859  
Net income—  —  —  —  —  14,147  —  14,147  
Other comprehensive income—  —  —  —  —  —  27,405  27,405  
Stock options & other stock transactions, net41,000  —  —  —  346  68  —  414  
Restricted stock awards, net865,091  —  —  (17,208) 4,025  14,776  —  1,593  
Cash dividends declared ($0.07 per common share)
—  —  —  —  —  (13,768) —  (13,768) 
Cash dividends declared ($16.25 per preferred share)
—  (218) —  —  —  (1,976) —  (2,194) 
Purchase of treasury stock(4,900,759) —  —  —  (81,032) —  —  (81,032) 
Balance at March 31, 2020194,460,656  $137,363  $2,299  $3,749,508  $(660,069) $1,125,702  $67,621  $4,422,424  
See accompanying notes to consolidated financial statements.
6
Table of Contents
STERLING BANCORP AND SUBSIDIARIES
Consolidated Statements of Cash Flows (Unaudited)
(Dollars in thousands)


Three months ended
March 31,
20202019
Cash flows from operating activities:
Net income $14,147  $101,437  
Adjustments to reconcile net income to net cash provided by operating activities:
Provisions for credit losses138,280  10,200  
Net (gain) from write-downs and sales of other real estate owned(62) (316) 
Net (gain) on extinguishment of Senior Notes(8) (46) 
Depreciation of premises and equipment5,034  4,990  
Loss on extinguishment of FHLB loans753  —  
Asset write-downs, retention and severance compensation and other restructuring charges—  3,344  
Amortization of intangible assets4,200  4,826  
Amortization of low income housing tax credits7,401  3,810  
Net (gain) loss on sale of securities(8,412) 13,184  
Gain on security calls available for sale(4,897) —  
Loss on security calls held to maturity17  —  
Net gain on loans held for sale—  (8,337) 
Net amortization of premiums on securities7,978  9,060  
 Amortization of premium on certificates of deposit
(692) (1,077) 
 Net accretion of purchase discount and amortization of net deferred loan costs
(10,385) (25,280) 
 Net accretion of debt issuance costs and amortization of premium on borrowings
(144) (431) 
Restricted stock compensation expense6,006  5,123  
Originations of loans held for sale—  (4,500) 
Proceeds from sales of loans held for sale1  2,273  
Increase in cash surrender value of bank owned life insurance(5,018) (3,641) 
Deferred income tax expense(60,653) 21,073  
 Other adjustments (principally net changes in other assets and other liabilities)
(91,040) (27,324) 
Net cash provided by operating activities2,506  108,368  
Cash flows from investing activities:
Purchases of securities:
Available for sale(124,408) (17,839) 
Held to maturity(882) (3,420) 
Proceeds from maturities and other principal payments on securities:
Available for sale64,600  71,784  
Held to maturity17,343  17,311  
Proceeds from sales of securities available for sale407,524  738,751  
Proceeds from calls of securities available for sale138,872  —  
Proceeds from calls of securities held to maturity905  —  
Portfolio loan originations, net(339,730) (200,709) 
Proceeds from sale of commercial loans95,179  —  
Proceeds from sale of residential mortgage loans —  1,319,234  
Redemptions of FHLB and FRB stock, net11,083  71,235  
7
Table of Contents
STERLING BANCORP AND SUBSIDIARIES
Consolidated Statements of Cash Flows (Unaudited)
(Dollars in thousands)

Three months ended
March 31,
20202019
Proceeds from sales of other real estate owned1,168  4,198  
Purchases of premises and equipment(8,374) (3,540) 
 Proceeds from bank owned life insurance
2,218  132  
Proceeds from sale of premises and equipment1,884  —  
Purchases of low income housing tax credits(45,196) (3,602) 
Cash paid for acquisition, net—  (515,692) 
Net cash provided by investing activities222,186  1,477,843  
Cash flows from financing activities:
 Net increase (decrease) in transaction, savings and money market deposits
628,101  (44,755) 
Net (decrease) increase in certificates of deposit(487,787) 57,323  
Net (decrease) in short-term FHLB borrowings(40,000) (754,000) 
Advances of term FHLB borrowings300,000  300,000  
Repayments of term FHLB borrowings(550,000) (1,125,000) 
 Repayment of Senior Notes
(2,000) (6,954) 
 Net increase in other borrowings
4,884  5,682  
Net increase in mortgage escrow funds38,175  29,145  
Proceeds from stock option exercises414  55  
Treasury shares repurchased (81,032) (154,289) 
Cash dividends paid - common stock(13,768) (15,079) 
Cash dividends paid - preferred stock(2,194) (2,194) 
Net cash (used in) financing activities(205,207) (1,710,066) 
Net increase (decrease) in cash and cash equivalents19,485  (123,855) 
Cash and cash equivalents at beginning of period329,151  438,110  
Cash and cash equivalents at end of period$348,636  $314,255  
Supplemental cash flow information:
Interest payments$58,803  $69,935  
Income tax payments5,678  14  
Real estate acquired in settlement of loans732  1,007  
Unsettled securities transactions —  7,188  
Loans transferred from held for investment to held for sale95,179  —  
Securities held to maturity transferred to available for sale—  708,627  
Operating cash flows from operating leases 5,109  4,153  
Right-of-use assets obtained in exchange for lease liabilities —  125,394  
Acquisitions:
Non-cash assets acquired:
Total loans, net$—  $471,878  
Accrued interest receivable—  1,789  
Goodwill—  44,781  
Other assets—  545  
Total non-cash assets acquired—  518,993  
Liabilities assumed:
Other liabilities—  3,301  
Total liabilities assumed—  3,301  
Net non-cash assets acquired—  515,692  
Total consideration paid$—  $515,692  
See accompanying notes to consolidated financial statements.
8
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)

(1) Basis of Financial Statement Presentation and Summary of Significant Accounting Policies

(a) Nature of Operations
Sterling Bancorp (the “Company,” “we,” “us” and “our” ) is a Delaware corporation, a bank holding company and a financial holding company headquartered in Montebello, New York that owns all of the outstanding shares of common stock of Sterling National Bank (the “Bank”), its principal subsidiary. The Bank is a full-service regional bank specializing in the delivery of services and solutions to business owners, their families and consumers within the communities it serves through teams of dedicated and experienced relationship managers.

(b) Basis of Presentation
The consolidated financial statements in this Quarterly Report on Form 10-Q include the accounts of the Company and all other entities in which the Company has a controlling financial interest. All significant intercompany balances and transactions have been eliminated in consolidation. The accounting and financial reporting policies we follow conform, in all material respects, to accounting principles generally accepted in the United States (“GAAP”) and to general practices within the banking industry, which include regulatory reporting instructions.

The consolidated financial statements in this Quarterly Report on Form 10-Q have not been audited by an independent registered public accounting firm, but, in the opinion of management, reflect all adjustments necessary for a fair presentation of our financial position and results of operations. All such adjustments were of a normal and recurring nature. The consolidated financial statements have been prepared in accordance with GAAP and with the instructions to Form 10-Q adopted by the Securities and Exchange Commission (the “SEC”). Accordingly, the financial statements do not include all of the information and footnotes required by GAAP for complete financial statements and should be read in conjunction with our consolidated financial statements, and notes thereto, for the year ended December 31, 2019, included in our Annual Report on Form 10-K, as filed with the SEC on February 28, 2020 (the “2019 Form 10-K”). Operating results for the interim periods disclosed herein are not necessarily indicative of the results that may be expected for a full year or any future period. Certain items in prior financial statements have been reclassified to conform to the current presentation. These reclassifications had no impact on previously reported net income.

(c) Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, income, expense and contingencies at the date of the financial statements. Actual results could differ significantly from these estimates, particularly the allowance for loan losses and the status of contingencies, and are subject to change.

(d) Risks and Uncertainties - COVID-19
The global pandemic resulting from the outbreak of the novel strain of coronavirus (“COVID-19”) has negatively impacted the global economy, disrupted global supply chains, lowered equity market valuations, created significant volatility and disruption in financial markets, and increased unemployment levels. In addition, the pandemic has resulted in temporary closures of many businesses and the institution of social distancing and sheltering in place requirements in many states and communities. In particular, COVID-19 has disrupted our normal course of providing services to our clients and adversely impacted our clients and could impair their ability to fulfill their obligations to the Bank. While there has been no significant negative impact to our colleagues and business operations in the first quarter, COVID-19 could impact our business continuity plans in the future.

Our consolidated financial statements reflect estimates and assumptions we make that affect the reported amounts of assets and liabilities, including the amount of the allowances for credit losses we established. We considered the impact of COVID-19 on the assumptions and estimates used and the COVID-19 pandemic did have a material adverse impact on our provision for credit losses and, subsequent to March 31, 2020, resulted in a significant amount of forbearance requests, which are in the process of review and implementation.

We are dependent upon the willingness and ability of our colleagues and clients to conduct banking and other financial transactions. If the global response to COVID-19 is unsuccessful, or results in additional impacts, it is reasonably possible that we could experience a material adverse effects on our business, financial condition, results of operations, cash flows and guidance, including material changes to our significant estimates. While it is not possible to know the full extent that COVID-19, and resulting measures in response thereto will have on our operations, we are disclosing potentially material items of which we are aware as of the date of this report. In particular, we have conducted an initial review of our loan and securities portfolios to identify specific exposures and sectors that may be more at risk or impacted by COVID-19. These sectors include commercial real estate loans related to hotels and lodging and retail establishments; equipment finance loans related to transportation and oil and gas; commercial and industrial loans related to restaurant franchise financing. As of March 31, 2020, we had total outstanding loan balances to clients in these sectors of approximately
9
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)
$2.7 billion, which represented 12.5% of the total loan portfolio. Also, if the COVID-19 impact continues to linger, we may need to establish a valuation allowance for deferred tax assets and the effects could cause us to perform an intangible assets impairment test and result in an impairment charge being recorded in that period. In the event we conclude that all or a portion of our intangible assets are impaired, a non-cash charge for the amount of such impairment would be recorded to earnings. Such a charge would have no impact on tangible capital or our regulatory capital ratios.

(e) Accounting Principle Change
Effective January 1, 2020, we adopted Accounting Standards Update (“ASU”) 2016-13 “ASU 2016-13 Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments”, which replaced the prior incurred loss methodology with an expected loss methodology that is referred to as the current expected credit loss (“CECL” or the “CECL Standard”). The measurement of expected credit losses under the CECL Standard is applicable to financial assets measured at amortized cost, including portfolio loans and investment securities classified as held-to-maturity (“HTM”). It also applies to off-balance sheet credit exposures including loan commitments, standby letters of credit, financial guarantees and other similar instruments. In addition, the CECL Standard changes the accounting for investment securities classified as available-for-sale (“AFS”), including a requirement that estimated credit losses on AFS securities be presented as an allowance rather than as a direct write-down of the carrying balance of securities which we do not intend to sell, or believe that it is more likely than not, that we will be required to sell.

We adopted the CECL Standard using the modified retrospective method for all financial assets measured at amortized cost and off-balance sheet credit exposures. As discussed further below, purchase credit deteriorated assets were measured on a prospective basis in accordance with the CECL Standard and all purchase credit impaired loans at December 31, 2019 were considered purchase credit deteriorated loans upon adoption. Results for reporting periods beginning after January 1, 2020 are presented under the CECL Standard while prior period amounts continue to be reported in accordance with previously applicable accounting guidance. The adoption of the CECL Standard resulted in the following adjustments to our financial statements:
Change in consolidated balance sheet Tax effectChange to retained earnings from adoption of new accounting principle
Allowance for credit losses (“ACL”) - loans $68,088  $18,820  $49,268  
ACL - loans - (adjustment related to purchase credit impaired loan mark)1
22,496  —  —  
Total ACL - loans  90,584  18,820  49,268  
ACL - HTM securities  796  220  576  
ACL - off balance sheet credit exposure (recorded in other liabilities)6,095  1,685  4,410  
Total impact of CECL adoption  $97,475  $20,725  $54,254  
1This amount represents gross-up of the balance of the amortized cost of purchase credit impaired loans that were considered purchase credit deteriorated loans on adoption of the CECL Standard.

The table below presents additional details on the impact of the adoption of the CECL Standard on HTM securities, portfolio loans and off-balance sheet credit exposures as of January 1, 2020:

10
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)
As reported under CECLPrior to CECL Standard adoptionImpact of CECL adoption
Assets:
ACL - HTM securities:
Corporate and other$108  $—  $108  
State and municipal688  —  688  
Total ACL - HTM securities796  —  796  
ACL - loans$196,822  $106,238  $90,584  
Liabilities:
ACL - off-balance sheet credit exposures (recorded in other liabilities)$6,749  $654  $6,095  

Under prior GAAP, our allowance for loan losses (“ALLL”) was determined under the incurred loss model, using an average of actual losses incurred over the most recent three-year period and the application of qualitative factors to arrive at an allowance that represented our best estimate of probable credit losses inherent in our loan portfolio. Under the CECL Standard, our ACL is based on an estimate of all amounts that are not expected to be collected over the contractual life of the portfolio loans, which is comprised of quantitative and qualitative factors.

As of December 31, 2019, a significant portion of our loans were acquired in business combination transactions that were subject to purchase accounting adjustments, which incorporated life of loan losses estimates at the date of acquisition into the estimate of the fair value of the loan. To the extent the loan continued to perform as expected since date of acquisition, we generally did not apply amounts from our allowance for loan losses methodology to such loans. At December 31, 2019, our allowance for loan losses of $106,238 was recorded as a valuation account against $15,433,966 of our portfolio loans. Acquired loans of $6,006,246 did not have an allowance for loan loss allocation as those loans had remaining purchase accounting adjustments.The composition of our portfolio loans at December 31, 2019 was the following:
At December 31, 2019December 31, 2019
OriginatedAcquiredTotalALLL
Commercial and industrial$6,982,226  $1,250,493  $8,232,719  $52,548  
Commercial mortgage(1)
7,788,749  2,974,100  10,762,849  44,137  
Residential mortgage541,681  1,668,431  2,210,112  7,598  
Consumer121,310  113,222  234,532  1,955  
Total$15,433,966  $6,006,246  $21,440,212  $106,238  

(1) Commercial mortgage includes commercial real estate, multi-family and ADC loans.

The increase in the ACL - loans from the adoption of the CECL Standard included the following adjustments:
ALLL as of December 31, 2019Adjustments recorded as of January 1, 2020ACL as of January 1, 2020
CECL Day 1PCD gross-up
Commercial and industrial$52,548  $44,675  $6,624  $103,847  
Commercial mortgage44,137  21,384  1,440  66,961  
Residential mortgage7,598  942  13,162  21,702  
Consumer1,955  1,087  1,270  4,312  
Total$106,238  $68,088  $22,496  $196,822  

11
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)
Loans designated as purchased credit impaired loans (“PCI”) and accounted for under Accounting Standards Codification (“ASC”) 310-30 were designated as purchased with credit deterioration loans (“PCD”). In accordance with the CECL Standard, we did not reassess whether PCI loans met the criteria of PCD loans as of the date of adoption, and determined all PCI loans were PCD loans. On January 1, 2020, the amortized cost basis of PCD loans totaled $116,274. We recorded an increase to the balance of PCD loans and an increase to the ACL - loans of $22,496, which represented the expected credit losses for PCD loans. The remaining non-credit discount (based on the adjusted amortized cost basis) will be accreted into interest income at the effective interest rate as of January 1, 2020 over the remaining estimated life of the loans. Also, in accordance with the CECL Standard, we did not reassess whether modifications to individual acquired financial assets were troubled debt restructurings (“TDRs”) as of the date of adoption.

Investment Securities: Investment securities are classified as HTM and carried at amortized cost when management has the intent and ability to hold them to maturity. Investment securities not classified as HTM or trading are classified as AFS. Securities AFS are carried at fair value, with unrealized holding gains and losses reported in comprehensive income, net of tax.

Interest income includes amortization of purchase premiums or discounts. Premiums and discounts on securities are generally amortized using the level-yield method without estimating prepayments, except for mortgage-backed securities, where prepayment rates are estimated. Premiums on callable investment securities are amortized to their earliest call date. Gains and losses on sales of securities are recorded on the trade date and determined using the specific identification method.

An investment security is placed on non-accrual status when management concludes it will not receive all principal and interest in a timely fashion in accordance with the terms of the security. Interest accrued but not received for a security placed on non-accrual is reversed against interest income. At March 31, 2020 and December 31, 2019, there were no securities placed on non-accrual.

ACL - HTM securities: HTM securities include residential mortgage-backed securities issued by government agencies, federal agency securities, corporate securities, state and municipal securities and other securities. We estimate expected credit losses on HTM securities individually using a discounted cash flow methodology. Our expected loss model estimates the probability of default and loss given default based on the security rating, historical loss rates by security ratings, whether the issuer continues to make timely principal and interest payments in accordance with the contractual terms of the security, and reasonable and supportable forecasts. For unrated state and municipal securities, we perform an internal credit evaluation and assign a rating to the security for ACL - HTM securities modeling purposes. The loss given default is estimated by security, and the aggregate amount results in the estimated ACL - HTM securities balance. Included in state and municipal securities at March 31, 2020, were non-rated securities of $119,078, which consisted mainly of short-term general obligation securities and bond anticipation notes and tax anticipation notes issued by jurisdictions in New York state.

At March 31, 2020 and December 31, 2019, all of our residential mortgage-backed and federal agency securities were issued by U.S. government entities or agencies. These securities are either explicitly or implicitly guaranteed by the U.S. government, are highly rated by a nationally recognized statistical rating organization and have had no historical credit defaults. We expect these securities are fully collectible, as these securities are backed by the full faith and credit of or directly guaranteed by the U.S. Government. Accordingly, we established no ACL for such securities.

Accrued interest receivable on HTM investment securities totaled $20,099 and $16,536 at March 31, 2020 and December 31, 2019, respectively, and is excluded from the estimate of ACL. Accrued interest receivable on HTM investment securities is included in accrued interest receivable on the consolidated balance sheets.

ACL - on investment securities classified as AFS: For AFS investment securities which are in an unrealized loss position, we first assess whether we intend to sell, or it is more likely than not, that we will be required to sell the security before recovery of the amortized cost basis. If either of the criteria is met, the amortized cost basis of the security is written down to fair value through income. For AFS investment securities that do not meet the aforementioned criteria, we evaluate whether the decline in fair value has resulted from an actual or estimated credit loss event or other factors. In making this assessment, we consider the extent to which fair value is less than amortized cost, changes to the rating of the security, and adverse conditions specifically related to the security, among other factors. If this assessment indicates that a credit loss is likely, the present value of cash flows expected to be collected from the security are compared to the amortized cost basis of the security. If the present value of the cash flows expected to be collected is less than the amortized cost basis, an ACL is recorded for the estimated credit loss, limited by the amount that the fair value is less than the amortized cost basis. Any impairment that has not been recorded through an ACL is recognized in other comprehensive income.

Changes in the ACL are recorded as provision for (or reversal of) credit loss expense. Losses are charged against the allowance when we believe the uncollectibility of an AFS security has been confirmed or if either of the criteria regarding intent or requirement to sell is met.

12
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)
Accrued interest receivable on AFS investment securities totaled $12,692 and $12,772 at March 31, 2020 and December 31, 2019, respectively, and is excluded from the estimate of credit losses. Accrued interest receivable on AFS investment securities is included in accrued interest receivable on the consolidated balance sheets.

Portfolio loans: Portfolio loans are loans we have the intent and ability to hold for the foreseeable future, or until maturity or payoff, and are reported at amortized cost. The amortized cost is the principal balance outstanding, net of purchase premiums and discounts, including purchase accounting adjustments from prior merger transactions, deferred loan fees and costs. Accrued interest receivable on portfolio loans totaled $69,311 and $71,004 at March 31, 2020 and December 31, 2019, respectively, and was reported in accrued interest receivable on the consolidated balance sheets. Interest income is accrued on the unpaid principal balance. For portfolio loans with a term of one year or more, loan origination fees, net of certain direct origination costs, are deferred and recognized in interest income using the level-yield method without anticipating prepayments.

Generally, interest income is discontinued on portfolio loans and loans are placed on non-accrual status at the earlier of: (i) when we determine the borrower may likely be unable to meet contractual principal or interest obligations; or (ii) when the loan is 90 days delinquent unless the loan is well secured and in process of collection. Consumer loans are generally charged-off no later than 120 days past due unless the loan is in the process of collection. For other portfolio loans, when we conclude the collateral and or debt service capacity of the borrower are insufficient to repay the loan, we charge-off the amount that is deemed uncollectible. Past due status is based on the contractual terms of the loan.

All interest accrued but not received on loans placed on non-accrual is reversed against interest income. Interest received on such loans is generally accounted for under the cost-recovery method, until the loan qualifies to be returned to accrual status. Under the cost-recovery method, interest income is not recognized until the loan balances is reduced to zero. We may elect to account for interest receipts on non-accrual loans on a cash-basis when we have determined we are in a well-secured position. Under the cash basis method, interest income is recorded when cash payments are received. Loans are returned to accrual status when all principal and interest amounts contractually due are brought current and future payments are reasonably assured.

Purchase Credit Deteriorated (“PCD”) Loans: We have acquired loans through direct purchase and, more often, in merger transactions, some of which have experienced more than an insignificant credit deterioration since origination. Criteria we consider to determine whether a loan should be designated PCD includes, but is not limited to, the following: (i) loans delinquent over 60 days as of the date of acquisition; (ii) loans downgraded and rated special mention or worse as of the date of acquisition; (iii) loans on non-accrual; and (iv) loans deemed collateral dependent as of the date of acquisition. PCD loans are recorded at the purchase price paid. An ACL is determined using the same methodology as for other portfolio loans and the sum of the purchase price and ACL represents the initial amortized cost basis of the loan. The difference between the initial amortized cost basis and the par value of the loan represents either a non-credit discount or premium, which is amortized into interest income over the life of the loan. Subsequent changes to the ACL are recorded through provision expense. The only loans classified as PCD as of March 31, 2020 are loans that were formerly classified as PCI loans under the incurred loss model at adoption of the CECL Standard.

ACL - Loans: The ACL - loans is a valuation account that is deducted from the amortized cost basis of portfolio loans to present the net amount expected to be collected on portfolio loans over their contractual life. Loans are charged-off against the allowance when we believe the uncollectibility of a loan balance has been confirmed, and the expected recoveries do not exceed the aggregate of amounts previously charged-off or expected to be charged-off.

We estimate the balance of the ACL - loans using relevant available information from internal and external sources, relating to past events, current conditions, and reasonable and supportable forecasts. The methodologies for estimating the ACL - loans apply historical loss information, adjusted for current loan-specific risk characteristics such as differences in underwriting standards, portfolio composition, delinquency levels, loan terms, changes in environmental conditions such as changes in GDP, unemployment rates, credit spreads, property values, other relevant factors, that are reasonable and supportable, to the identified financial assets for which the historical loss experience was observed. Our methodologies revert back to historical loss information at the individual macro variable level, which begins in two to three years and converges to its long-run equilibrium, when we can no longer develop reasonable and supportable forecasts.

The ACL - loans is measured on a collective (pool) basis when similar risk characteristics exist. We measure our warehouse lending portfolio and certain consumer loans at the loan level. Generally, for all other loan types, the estimated expected credit loss is also calculated at the loan level and pool assignments are only utilized for aggregating the allowance estimates of similar loan types for financial statement disclosure purposes. We have identified the following portfolio segments and estimate our ACL - loans using the following methods:

13
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)
Portfolio segmentACL MethodologyRisk characteristicsPortfolio composition
Traditional Commercial and IndustrialLoss rateActual cash flow varies from amounts estimated, changes in collateral value, business not successfulVarious types of secured and unsecured traditional C&I loans to small and medium-sized businesses in our market area, including loans collateralized by assets, such as accounts receivable, inventory, marketable securities, other liquid collateral, equipment and other business assets.
Asset-based lending (“ABL”)Loss rateActual cash flow varies from amounts estimated, borrower unable to collect accounts receivable or convert inventory, uncertain value of collateralLoans to mid-size businesses on a national basis. ABL loans are secured with a blanket lien on all business assets and will include direct control and supervision of accounts receivable, inventory, machinery and equipment and real estate collateral.
Payroll financeLoss rateInability to collect on accounts receivable, delays in accounts receivable turnoverFinancing and business process outsourcing, including full back-office, technology and tax accounting services, to independently-owned temporary staffing companies nationwide. Loans typically are structured as an advance used by our clients to fund their employee payroll and are outstanding on average for 40 to 45 days.
Warehouse lendingNo historical losses, qualitative overlayInability to sell underlying mortgage loan collateral into the secondary marketResidential mortgage warehouse funding facilities to non-bank mortgage companies. These loans consist of a line of credit used as temporary financing during the period between the closing of a mortgage loan until its sale into the secondary market, which on average occurs 20 days of the original loan closing.
Factored receivablesLoss rateInability to collect on accounts receivable, delays in accounts receivable turnoverWe provide accounts receivable management services. The purchase of a client’s accounts receivable is traditionally known as “factoring” and results in payment by the client of a factoring fee, which is generally a percentage of the factored receivables or sales volume, which is designed to compensate the Bank for the bookkeeping and collection services provided and, if applicable, its credit review of the client’s customer and assumption of customer credit risk.
Equipment financingLoss rateActual cash flow varies from amounts estimated, changes in collateral valueEquipment financing loans are offered through direct lending programs, third-party sources and vendor programs nationally. Our equipment finance lending mainly includes full payout term loans and secured loans for various types of business equipment.
Public sector financeDCFMunicipal tax / revenue receipts insufficient to service debt; loss of access to capital marketsLoans to state, municipal and local government entities nationally. Loans are either secured by equipment, or are obligations that are backed by the ability to levy taxes, either generally or associated with a specific project.
Commercial real estate/ multi-family (“CRE”)PD/LGD for non-owner occupied and loss rate for owner occupiedActual cash flow varies from amounts estimated, changes in collateral valueCRE loans secured mainly by first liens on properties, including retail properties, office buildings, nursing homes, hotels, motels or restaurants, warehouses, schools and industrial complexes. To a lesser extent, we originate CRE loans for recreation, medical use, land, gas stations, not for profit and other categories. These loans are generally secured by properties located in our primary market area.
Acquisition, development and constructionPD/LGDConstruction costs are greater than anticipated, changes in estimated collateral value, project completionConstruction loans are made in accordance with a schedule reflecting the cost of construction. Repayment of construction loans on residential subdivisions is normally expected from the sale of units to individual purchasers, except in cases of owner occupied construction loans. In the case of income-producing property, repayment is usually expected from permanent financing upon completion of construction. We provide permanent mortgage financing on most of our construction loans on income-producing property.
14
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)
Portfolio segmentACL MethodologyRisk characteristicsPortfolio composition
Residential mortgage and home equity lines of creditPD/LGDProduct type, conforming, vs. non-conforming, interest only, converted interest only, amortizing, FICO score, LTVResidential mortgage conforming and non-conforming, fixed-rate and adjustable rate mortgage (“ARM”) loans with maturities up to 30 years. Also includes home equity lines of credit.
Other consumer loans 8 quarter historical lossFICO, LTV, product typeOther consumer loans consist of loans for personal use.

Under the loss rate method, expected credit losses are estimated using a loss rate that is multiplied by the amortized cost of the asset at the balance sheet date. For each loan segment identified above, we apply an expected historical loss trend based on third-party loss estimates, correlate them to observed economic metrics and reasonable and supportable forecasts of economic conditions and overlay qualitative factors as determined by management.

Under the discounted cash flow method, expected credit losses are determined by comparing the amortized cost of the asset at the balance sheet date to the present value of estimated future principal and interest payments expected to be collected over the remaining life of the asset. Our loss model generates cash flow projections at the loan level based on reasonable and supportable projections, from which we estimate payment collections adjusted for curtailments, recovery time, probability of default and loss given default.

Under the probability of default and loss given default method, expected credit losses are calculated by multiplying the probability that the asset will default within a given time frame (“PD”) by the percentage of the asset that is not expected to be collected due to default (“LGD”), and multiplying this factor by the amortized cost of the asset at the balance sheet date. The PD and LGD is calculated based on third party historical information of loan performance, real estate prices and other factors, adjusted for current conditions and reasonable and supportable forecasts.

Qualitative loss factors are based on our judgement of company, market, industry or business specific data, loan trends, changes in portfolio segment composition, delinquency and loan rating.

When a foreclosure is deemed probable, we estimate the fair value of the collateral at the reporting date to record the net carrying amount of the asset and determine the ACL. When repayment is dependent upon the sale of the collateral, the fair value of the collateral is adjusted for estimated costs to sell. If repayment depends on the operation, rather than the sale, of the collateral, an estimate for cost to sell is not included in the fair value of the collateral.

Determining the Contractual Term: Expected credit losses are estimated over the contractual term of the loans, adjusted for expected prepayment rates when appropriate. The contractual term excludes expected extensions, renewals, and modifications unless either of the following applies: we have a reasonable expectation at the reporting date that a TDR will be executed with an individual borrower, or the extension or renewal options are included in the original or modified contract at the reporting date and are not unconditionally cancellable by us.

TDRs: A loan for which the terms have been modified resulting in a concession, and for which the borrower is experiencing financial difficulties, is considered to be a TDR. The ACL on a TDR is measured using the same method as all other portfolio loans, except when the value of a concession cannot be measured using a method other than the discounted cash flow method. When the value of a concession is measured using the discounted cash flow method, the ACL is determined by discounting the expected future cash flows at the original interest rate of the loan.

ACL on Off-Balance Sheet Credit Exposures: We estimate expected credit losses over the contractual period in which we are exposed to credit risk via a contractual obligation, unless that obligation is unconditionally cancellable by us. The ACL on off-balance sheet credit exposures is adjusted as a provision for credit loss expense. The estimate includes consideration of the likelihood that funding will occur and an estimate of expected credit losses on commitments expected to be funded over its estimated life. Generally, expected credit losses on commitments is based on historical losses on similar portfolio segments, economic conditions, and qualitative factors.

15
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)
Our off-balance sheet credit exposures include mainly loan origination commitments on construction loans, unused committed lines on traditional commercial and industrial loans, asset-based lending loans, equipment finance loans, warehouse lending loans, and standby and performance-based letters of credit. See Note 15 “Commitments and Contingencies” for additional information.

Macroeconomic Assumptions: We rely on economic models and forecast assumptions developed by Moody’s Analytics, Inc. (“Moody’s”), our principal CECL vendor, in measuring our estimate of the ACL. The key forecast assumptions that drive the economic models are presented for approval to our CECL committee, which is comprised of representatives from finance, credit and risk and then incorporated into the expected loss models. The macroeconomic model scenarios are updated on a quarterly basis.

(2) Acquisitions

Equipment finance loan and lease portfolio and origination platform acquired from Santander Bank (“Santander”)
On November 29, 2019, the Bank acquired an equipment finance loan and lease portfolio consisting of equipment finance loans, sales-type leases and operating leases from Santander (the “Santander Portfolio Acquisition”). In addition, the Bank obtained relationship management and business development personnel who will continue to manage the acquired loan and lease portfolio and originate new loans and leases. The total consideration paid in cash at closing was $846,112. We acquired $764,020 of equipment finance loans and leases (classified as portfolio loans on the consolidated balance sheet), and $74,834 of operating leases (classified as other assets on the consolidated balance sheet). The fair value of these loans and leases was $820,144 at the time of acquisition. The Bank paid a premium of 0.75% on the unpaid principal balance of the loans or $6,291. The transaction was accounted for as a business combination. We recorded a $5,133 restructuring charge consisting mainly of severance, retention, systems integration expense and facilities consolidation, which is included in charge for asset write-downs, retention and severance on the consolidated income statement. The acquired loans and origination platform have been fully integrated into our equipment finance business.

Commercial loan portfolio and origination platform acquired from Woodforest National Bank (“Woodforest”)
On February 28, 2019, the Bank acquired a commercial loan portfolio consisting of equipment finance loans and leases and asset-based lending loans from Woodforest (the “Woodforest Acquisition”). In addition, the Bank obtained sales and relationship management and business development personnel based in Novi, Michigan, who will continue to originate new loans and leases. The total consideration paid in cash at closing was $515,692. We acquired $166,143 of equipment finance loans, and $331,842 of asset-based lending loans, which are mainly variable rate loans. The fair value of these loans and leases was $471,878 at the time of acquisition. The Bank paid a premium of 3.75% on the unpaid principal balance of the loans or $18,674. The transaction was accounted for as a business combination. We recorded a $3,344 restructuring charge consisting mainly of severance, retention, systems integration expense and facilities consolidation, which is included in charge for asset write-downs, retention and severance on the consolidated income statements. The acquired loans and origination platform have been fully integrated into our asset-based lending and equipment finance business lines.

16
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)
(3) Securities

The following table summarizes the amortized cost, fair value, and ACL related to HTM securities, the amortized cost and fair value related to AFS securities and the corresponding amounts of gross unrealized gains and losses recognized in accumulative other comprehensive income and gross unrecognized gains and losses at March 31, 2020. The terms “MBS” refers to mortgage-backed securities and the term “CMOs” refers to collateralized mortgage obligations. Both of these terms are further defined in Note 17. “Fair Value Measurements”:

March 31, 2020
Available for SaleHeld to Maturity
Amortized
cost		Gross
unrealized
gains		Gross
unrealized
losses		Fair
value		Amortized
cost		Gross
unrecognized
gains		Gross
unrecognized
losses		Fair
value		Allowance for credit losses
Residential MBS:
Agency-backed$1,173,696  $53,661  $(38) $1,227,319  $154,580  $5,962  $—  $160,542  $—  
CMOs/Other MBS482,873  15,044  (16) $497,901  —  —  —  —  —  
Total residential MBS
1,656,569  68,705  (54) 1,725,220  154,580  5,962  —  160,542  —  
Other securities:
Federal agencies171,907  7,335  —  $179,242  59,556  1,412  —  60,968  —  
Corporate292,977  9,530  (1,947) $300,560  19,891  375  (8) 20,258  70  
State and municipal
446,446  10,220  (853) $455,813  1,709,400  69,066  (1,035) 1,777,431  2,384  
Other—  —  —  $—  12,750  141  (1) 12,890  45  
Total other securities911,330  27,085  (2,800) 935,615  1,801,597  70,994  (1,044) 1,871,547  2,499  
Total securities
$2,567,899  $95,790  $(2,854) $2,660,835  $1,956,177  $76,956  $(1,044) $2,032,089  $2,499  

17
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)

A summary of amortized cost and estimated fair value of securities as of December 31, 2019 is presented below:
December 31, 2019
Available for SaleHeld to Maturity
Amortized
cost		Gross
unrealized
gains		Gross
unrealized
losses		Fair
value		Amortized
cost		Gross
unrecognized
gains		Gross
unrecognized
losses		Fair
value
Residential MBS:
Agency-backed$1,595,766  $20,385  $(1,032) $1,615,119  $168,743  $1,827  $(75) $170,495  
CMOs/Other MBS508,217  4,104  (44) 512,277  —  —  —  —  
Total residential MBS2,103,983  24,489  (1,076) 2,127,396  168,743  1,827  (75) 170,495  
Other securities:
Federal agencies196,809  4,582  (253) 201,138  59,475  822  —  60,297  
Corporate307,050  13,917  (45) 320,922  19,904  415  —  20,319  
State and municipal
435,213  11,321  (342) 446,192  1,718,789  70,530  (134) 1,789,185  
Other—  —  —  —  12,750  147  (2) 12,895  
Total other securities939,072  29,820  (640) 968,252  1,810,918  71,914  (136) 1,882,696  
Total securities
$3,043,055  $54,309  $(1,716) $3,095,648  $1,979,661  $73,741  $(211) $2,053,191  

18
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)
The amortized cost and estimated fair value of securities at March 31, 2020 are presented below by contractual maturity. Actual maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations. Residential MBS are shown separately since they are not due at a single maturity date.
 March 31, 2020
Available for saleHeld to maturity
 Amortized
cost		Fair
value		Amortized
cost		Fair
value
Remaining period to contractual maturity:
One year or less$5,137  $5,122  $57,050  $57,466  
One to five years155,315  158,260  76,020  78,290  
Five to ten years449,755  461,786  335,166  347,885  
Greater than ten years301,123  310,447  1,333,361  1,387,906  
Total securities with a stated maturity date911,330  935,615  1,801,597  1,871,547  
Residential MBS1,656,569  1,725,220  154,580  160,542  
Total securities$2,567,899  $2,660,835  $1,956,177  $2,032,089  

Sales and calls of securities for the periods indicated below were as follows:
For the three months ended
March 31,
20202019
Available for sale:
Proceeds from sales$407,524  $738,751  
Gross realized gains 8,480  4,355  
Gross realized losses(68) (17,539) 
Income tax expense (benefit) on realized net gains / (losses)
1,472  (3,644) 
Proceeds from calls$139,777  $—  
Gross realized gains4,909  —  
Gross realized (losses)(29) —  
Income tax expense on realized net gains854  —  

We adopted ASU 2017-12, “Derivatives and Hedging (Topic 815) - Targeted Improvements to Accounting for Hedging Activities,” as of January 1, 2019, which allowed us to reclassify a debt security from HTM to AFS if the debt security is eligible to be hedged under the last-of-layer method in accordance with ASU 2017-12. Generally, this included debt securities that are pre-payable, including MBS, and debt securities that are callable by the issuer, which are applicable to many of our state and municipal debt securities. We transferred HTM securities with a book value of $720,440 and a fair value of $708,627 at December 31, 2018 to AFS effective January 1, 2019. In the first quarter of 2019, we sold securities with a book value of $751,935 to raise liquidity for the Woodforest Acquisition, and to reduce lower yielding securities as a percentage of total assets.

At March 31, 2020 and December 31, 2019, there were no holdings of securities of any one issuer in an amount greater than 10% of stockholders’ equity, other than the U.S. federal government and its agencies.

The following table summarizes AFS securities with unrealized losses, in an unrealized loss position for which an ACL has not been recorded at March 31, 2020 and December 31, 2019 aggregated by major security type and length of time in a continuous unrealized loss position:
19
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)
 Continuous unrealized loss position  
 Less than 12 months12 months or longerTotal
Fair
value		Unrealized lossesFair
value		Unrealized lossesFair
value		Unrealized losses
AFS
March 31, 2020
Residential MBS:
Agency-backed$3,287  $(13) $2,070  $(25) $5,357  $(38) 
CMOs/Other MBS5,663  (16) —  —  5,663  (16) 
Total residential MBS8,950  (29) 2,070  (25) 11,020  (54) 
Other securities:
Corporate48,993  (1,902) 4,994  (45) 53,987  (1,947) 
State and municipal28,994  (597) 14,811  (256) 43,805  (853) 
Total other securities77,987  (2,499) 19,805  (301) 97,792  (2,800) 
Total securities$86,937  $(2,528) $21,875  $(326) $108,812  $(2,854) 
December 31, 2019
Residential MBS:
Agency-backed$98,350  $(317) $108,052  $(715) $206,402  $(1,032) 
CMOs/Other MBS—  —  5,916  (44) 5,916  (44) 
Total residential MBS98,350  (317) 113,968  (759) 212,318  (1,076) 
Other securities:
Federal agencies39,573  (253) —  —  39,573  (253) 
Corporate—  —  12,006  (45) 12,006  (45) 
State and municipal12,795  (94) 14,651  (248) 27,446  (342) 
Total other securities52,368  (347) 26,657  (293) 79,025  (640) 
Total securities$150,718  $(664) $140,625  $(1,052) $291,343  $(1,716) 

The adoption of CECL did not have an impact on our accounting for AFS securities. We regularly review AFS securities for impairment resulting from credit losses using both qualitative and quantitative criteria based on the composition of the portfolio at each reporting period. Unrealized losses on corporate and state and municipal securities have not been recognized into income because the issuers are of high credit quality, we do not intend to sell and it is likely that we will not be required to sell the securities prior to their anticipated recovery. The decline in fair value is largely due to changes in interest rates and other market conditions. The issuers continue to make timely principal and interest payments on the securities. The fair value is expected to recover as the securities approach maturity.

At March 31, 2020, a total of 47 AFS securities were in a continuous unrealized loss position for less than 12 months and 77 AFS securities were in a continuous unrealized loss position for 12 months or longer.


20
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)
The following table summarizes securities HTM with unrecognized losses, segregated by the length of time in a continuous unrecognized loss position for the periods presented below:
 Continuous unrecognized loss position  
 Less than 12 months12 months or longerTotal
Fair
value		Unrecognized lossesFair
value		Unrecognized lossesFair
value		Unrecognized losses
HTM
March 31, 2020
Other securities:
Corporate$9,992  $(8) $—  $—  $9,992  $(8) 
State and municipal27,213  (925) 7,181  (110) 34,394  (1,035) 
Other4,999  (1) —  —  4,999  (1) 
Total securities$42,204  $(934) $7,181  $(110) $49,385  $(1,044) 
December 31, 2019
Residential MBS:
Agency-backed$39,732  $(69) $1,598  $(6) $41,330  $(75) 
Other securities:
State and municipal177  (2) 8,258  (132) 8,435  (134) 
Other9,998  (2) —  —  9,998  (2) 
Total other securities10,175  (4) 8,258  (132) 18,433  (136) 
Total securities$49,907  $(73) $9,856  $(138) $59,763  $(211) 

The following table presents the activity in the ACL - HTM securities by type of security for the period ended March 31, 2020:
Type of security
Corporate and OtherState and municipal
ACL - HTM:
Balance at December 31, 2019$—  $—  
Impact of adoption on January 1, 2020108  688  
Provision for credit loss expense recorded in the quarter ended March 31, 20207  1,696  
Total ACL - HTM at March 31, 2020$115  $2,384  

The ACL - HTM securities was estimated using a discounted cash flow approach. We discounted the expected cash flows using the effective interest rate inherent in the security. For floating rate securities, we projected interest rates using forward interest rate curves. We review the term structures for probability of default, probability of prepayment and loss given default. We estimate a reasonable and supportable term of three years, which was supported by our back testing process.

Credit Quality Indicators
We monitor the credit quality of HTM investment securities through the use of credit ratings, internal reviews and analysis of financial information and other data, and external reviews from a third-party vendor. We monitor credit quality indicators at least quarterly, and all credit ratings were updated and reviewed as of March 31, 2020. At March 31, 2020, a total of 9 HTM securities were in a continuous unrealized loss position for less than 12 months and 42 HTM securities were in a continuous unrealized loss position for 12 months or longer. The following table summarizes the amortized cost of HTM securities at March 31, 2020 aggregated by credit quality indicator:


21
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)
Credit Rating:Corporate and otherState and municipal
AAA$—  $756,731  
AA12,750  795,881  
A—  37,710  
Non-rated19,891  119,078  
Total$32,641  $1,709,400  

The majority of state and municipal securities had a rating of A or greater at March 31, 2020. State and municipal securities consist mainly of securities issued by jurisdictions located in the state of New York and securities issued by other states. The non-rated state and municipal securities consist general obligation securities and short-term bond anticipation notes and tax anticipation notes issued by municipalities in the state of New York.

A security is considered to be delinquent once it is 30 days past due under the terms of the agreement. There were no past due securities and there were no securities on non-accrual at March 31, 2020.

Securities pledged for borrowings at the FHLB and other institutions, and securities pledged for municipal deposits and other purposes, were as follows for the periods presented below:
March 31,December 31,
20202019
AFS securities pledged for borrowings, at fair value$27,562  $22,678  
AFS securities pledged for municipal deposits, at fair value1,161,100  866,020  
HTM securities pledged for borrowings, at amortized cost200  483  
HTM securities pledged for municipal deposits, at amortized cost1,098,088  1,432,909  
Total securities pledged$2,286,950  $2,322,090  



22
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)
(4) Portfolio Loans

At and prior to December 31, 2019, portfolio loans were accounted for under the incurred loss model. At March 31, 2020, portfolio loans are accounted for under the expected loss model. Accordingly, some of the information presented below is not comparable from period to period. See Note 1. “Basis of Financial Statement Presentation - (e) Accounting Principle Change” for additional information.

The composition of our total portfolio loans, which excludes loans held for sale, was the following for the periods presented below:
March 31, 2020December 31, 2019
Commercial:
Commercial & Industrial (“C&I”):
Traditional C&I$2,745,792  $2,355,031  
Asset-based lending1,075,092  1,082,618  
Payroll finance179,554  226,866  
Warehouse lending1,356,277  1,330,884  
Factored receivables225,144  223,638  
Equipment financing1,667,523  1,800,564  
Public sector finance1,234,092  1,213,118  
Total C&I8,483,474  8,232,719  
Commercial mortgage:
Commercial real estate (“CRE”)5,664,443  5,418,648  
Multi-family 4,735,123  4,876,870  
Acquisition, development and construction (“ADC”)
524,714  467,331  
Total commercial mortgage10,924,280  10,762,849  
Total commercial 19,407,754  18,995,568  
Residential mortgage2,077,534  2,210,112  
Consumer224,669  234,532  
Total portfolio loans21,709,957  21,440,212  
Allowance for credit losses(326,444) (106,238) 
Total portfolio loans, net$21,383,513  $21,333,974  

Portfolio loans are shown at amortized costs, which includes deferred fees, deferred costs and purchase accounting adjustments, which were $45,668 at March 31, 2020 and $79,639 at December 31, 2019. The balance of portfolio loans excludes accrued interest receivable.

At March 31, 2020 and December 31, 2019, the Bank pledged residential mortgage and CRE loans of $7,739,208 and $7,670,673, respectively, to the FHLB as collateral for certain borrowing arrangements. See Note 8. “Borrowings”.
23
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)
Portfolio loans:
An analysis of the aging of portfolio loans, segregated by loan type as of March 31, 2020, is presented below:
 March 31, 2020
 Current30-59
days
past due		60-89
days
past due		90+
days
past due		Total
Traditional C&I
$2,715,924  $10,196  $2,036  $17,636  $2,745,792  
Asset-based lending
1,075,092  —  —  —  1,075,092  
Payroll finance
178,743  —  —  811  179,554  
Warehouse lending
1,356,277  —  —  —  1,356,277  
Factored receivables
225,144  —  —  —  225,144  
Equipment financing
1,594,494  22,188  12,775  38,066  1,667,523  
Public sector finance
1,234,092  —  —  —  1,234,092  
CRE
5,640,730  3,962  989  18,762  5,664,443  
Multi-family
4,728,275  2,553  695  3,600  4,735,123  
ADC
524,280  —  —  434  524,714  
Residential mortgage
1,998,923  17,321  7,869  53,421  2,077,534  
Consumer
211,051  2,134  516  10,968  224,669  
Total loans$21,483,025  $58,354  $24,880  $143,698  $21,709,957  
Total TDRs included above
$67,084  $1,028  $795  $10,205  $79,112  
Non-performing loans:
Loans 90+ days past due and still accruing$1,545  
Non-accrual loans252,205  
Total non-performing loans
$253,750  


24
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)

The following table represents an analysis of the aging of portfolio loans, segregated by loan type as of December 31, 2019:
 December 31, 2019
Current30-59
days
past due		60-89
days
past due		90+
days
past due		Non-
accrual		Total
Traditional C&I
$2,324,737  $961  $2,075  $110  $27,148  $2,355,031  
Asset-based lending
1,077,652  —  —  —  4,966  1,082,618  
Payroll finance
217,470  —  —  —  9,396  226,866  
Warehouse lending
1,330,884  —  —  —  —  1,330,884  
Factored receivables
223,638  —  —  —  —  223,638  
Equipment financing
1,739,772  15,678  12,064  —  33,050  1,800,564  
Public sector finance
1,213,118  —  —  —  —  1,213,118  
CRE
5,391,483  762  190  —  26,213  5,418,648  
Multi-family
4,872,379  1,078  13  —  3,400  4,876,870  
ADC
466,826  71  —  —  434  467,331  
Residential mortgage
2,129,840  17,904  93  —  62,275  2,210,112  
Consumer
220,372  1,988  3  —  12,169  234,532  
Total loans$21,208,171  $38,442  $14,438  $110  $179,051  $21,440,212  
Total TDRs included above
$49,260  $547  $—  $—  $25,849  $75,656  
Non-performing loans:
Loans 90+ days past due and still accruing
$110  
Non-accrual loans179,051  
Total non-performing loans
$179,161  

The following table presents the amortized cost basis of collateral-dependent loans by loan type and collateral as of March 31, 2020:
Collateral type
Real estateBusiness assetsEquipmentTaxi medallionsTotal
Traditional C&I$450  $7,066  $2,762  $18,404  $28,682  
Asset-based lending —  24,598  —  —  24,598  
Payroll finance—  8,659  —  —  8,659  
Equipment finance—  —  14,998  —  14,998  
CRE42,555  —  —  —  42,555  
Multi-family11,549  —  —  —  11,549  
ADC30,434  —  —  —  30,434  
Residential mortgage36,262  —  —  —  36,262  
Consumer3,211  —  —  —  3,211  
Total$124,461  $40,323  $17,760  $18,404  $200,948  

There were no warehouse lending, factored receivables, or public sector finance loans that were collateral-dependent at March 31, 2020. Collateral-dependent loans include all loans that were TDRs at March 31, 2020. In the table above, $156,329 of the total loans were on non-accrual at March 31, 2020 and loans that were accruing interest were performing TDRs. Business assets that secure traditional C&I and asset-based lending loans generally includes accounts receivable, inventory, machinery and equipment.

The following table provides additional information on our non-accrual loans and loans 90 days past due at March 31, 2020:
25
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)
March 31, 2020
Non-accrual loans with ACLLoans 90 days or more past due still accruing interest
Traditional C&I$26,311  $598  
Asset-based lending24,873  —  
Payroll finance8,684  —  
Equipment financing50,473  695  
CRE34,643  177  
Multi-family4,448  75  
ADC30,434  —  
Residential mortgage60,857  —  
Consumer11,482  —  
Total$252,205  $1,545  

At March 31, 2020, all non-accrual loans had an associated ACL reserve balance.

When the ultimate collectability of the total principal of a loan is in doubt and the loan is on non-accrual status, all payments are applied to principal under the cost recovery method. When the ultimate collectability of the total principal of a loan is not in doubt and the loan is on non-accrual status, contractual interest is credited to interest income when received, under the cash basis method.

At March 31, 2020 and December 31, 2019, the recorded investment of residential mortgage loans that were in the process of foreclosure was $33,443 and $38,024, respectively, which is included in non-accrual residential mortgage loans above.

The following table provides information on accrued interest receivable that was reversed against interest income for the three months ended March 31, 2020:

Interest reversed
Traditional C&I$7  
Asset-based lending67  
CRE146  
Multi-family 27  
ADC297  
Residential mortgage80  
Consumer7  
Total interest reversed$631  

26
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)


The following table sets forth loans evaluated for impairment by segment and the allowance for loan losses evaluated by segment at December 31, 2019:
 Loans evaluated by segmentAllowance evaluated by segment
 Individually
evaluated for
impairment		Collectively
evaluated for
impairment		PCI loansTotal
 loans		Individually
evaluated for
impairment		Collectively
evaluated for
impairment		Total allowance for loan losses
Traditional C&I
$29,838  $2,320,256  $4,937  $2,355,031  $—  $15,951  $15,951  
Asset-based lending4,684  1,064,275  13,659  1,082,618  —  14,272  14,272  
Payroll finance9,396  217,470  —  226,866  —  2,064  2,064  
Warehouse lending—  1,330,884  —  1,330,884  —  917  917  
Factored receivables—  223,638  —  223,638  —  654  654  
Equipment financing4,971  1,794,036  1,557  1,800,564  —  16,723  16,723  
Public sector finance
—  1,213,118  —  1,213,118  —  1,967  1,967  
CRE
39,882  5,358,023  20,743  5,418,648  —  27,965  27,965  
Multi-family11,159  4,860,246  5,465  4,876,870  —  11,440  11,440  
ADC
—  467,331  —  467,331  —  4,732  4,732  
Residential mortgage
6,364  2,140,650  63,098  2,210,112  —  7,598  7,598  
Consumer2,731  224,986  6,815  234,532  —  1,955  1,955  
Total portfolio loans$109,025  $21,214,913  $116,274  $21,440,212  $—  $106,238  $106,238  

The following table presents loans individually evaluated for impairment, excluding PCI loans, by segment of loans at December 31, 2019:
December 31, 2019
Unpaid principal balance
Recorded investment
Loans with no related allowance recorded:
Traditional C&I$39,595  $29,838  
Asset-based lending16,181  4,684  
Payroll finance9,396  9,396  
Equipment financing6,409  4,971  
CRE44,526  39,882  
Multi-family11,491  11,159  
Residential mortgage7,728  6,364  
Consumer2,928  2,731  
Total$138,254  $109,025  

Our policy generally requires a charge-off of the difference between the present value of the cash flows or the net collateral value of the collateral securing the loan and our recorded investment. As a result, there were no impaired loans with an allowance recorded at December 31, 2019.


27
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)
Troubled Debt Restructurings (“TDRs”)

At March 31, 2020 and December 31, 2019 we had TDRs totaling $79,112 and $75,656, respectively. We had ACL - loans of $9,297 at March 31, 2020 and an allowance for loan losses of $2,259 at December 31, 2019 related to TDRs. We did not have any outstanding commitments to lend additional amounts to customers with loans classified as TDRs as of March 31, 2020 or December 31, 2019.

The modification of the terms of loans that were subject to a TDR in the three months ended March 31, 2020 and March 31, 2019 consisted mainly of an extension of loan maturity date, converting a loan to interest only for a defined period of time, deferral of interest payments, waiver of certain covenants, or reducing collateral requirements or interest rates.
The following table presents loans by segment modified as TDRs that occurred during the first three months of 2020 and 2019:
March 31, 2020March 31, 2019
 Recorded investmentRecorded investment
 NumberPre-
modification		Post-
modification		NumberPre-
modification		Post-
modification
Asset-based lending
1  $4,943  $4,943  —  $—  $—  
Equipment financing
—  —  —  1  5,026  5,026  
Residential mortgage
—  —  —  2  895  895  
Total TDRs1  $4,943  $4,943  3  $5,921  $5,921  

During the three months ended March 31, 2020, there were 2 equipment finance loans, 2 CRE loans and 1 residential mortgage loan that were designated as a TDR that experienced payment defaults within the twelve months following the modification, which totaled $16,571. During the three months ended March 31, 2019, except for certain TDRs that are included in non-accrual loans, there were no TDRs that experienced a payment default within the twelve months following a modification. A payment default is defined as missing three consecutive monthly payments or being over 90 days past due on a scheduled payment. TDRs are formal loan modifications which consist mainly of an extension of the loan maturity date, converting a loan to interest only for some defined period of time, deferral of interest payments, waiver of certain covenants, or reducing collateral requirements or interest rates. TDRs during the periods presented above did not significantly impact the determination of the ACL - loans.

TDRs that subsequently defaulted described above increased the ACL by $989 and resulted in charge-offs of $805 during the three months ended March 31, 2020. A loan is considered to be in payment default once it is 90 days contractually past due under the modified terms.


28
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)
(5) Allowance for Credit Losses - Loans

Activity in our ACL- loans for the three months ended March 31, 2020 is summarized in the table below. The CECL Day 1 column presents adjustments recorded through retained earnings to adopt the CECL standard and the increase to the ACL - loans associated with purchase accounting marks on loans that were classified as PCI at December 31, 2019.

 For the three months ended March 31, 2020
 Beginning
balance		CECL Day 1Charge-offsRecoveriesNet
charge-offs		Provision / (credit)Ending balance
Traditional C&I
$15,951  $5,325  $(298) $475  $177  $13,836  $35,289  
Asset-based lending
14,272  11,973  (985) —  (985) 1,230  26,490  
Payroll finance
2,064  1,334  —  9  9  323  3,730  
Warehouse lending
917  (362) —  —  —  (266) 289  
Factored receivables
654  795  (7) 4  (3) 7,748  9,194  
Equipment financing
16,723  33,000  (4,793) 1,105  (3,688) 13,993  60,028  
Public sector finance
1,967  (766) —  —  —  728  1,929  
CRE
27,965  8,037  (1,275) 60  (1,215) 62,799  97,586  
Multi-family
11,440  14,906  —  —  —  22,751  49,097  
ADC
4,732  (119) (3) 105  102  10,489  15,204  
Residential mortgage
7,598  14,104  (1,072) —  (1,072) 2,460  23,090  
Consumer
1,955  2,357  (1,405) 1,125  (280) 486  4,518  
Total allowance for loan losses
$106,238  $90,584  $(9,838) $2,883  $(6,955) $136,577  $326,444  
Annualized net charge-offs to average loans outstanding:0.13 %
On January 1, 2020, we adopted CECL, which replaced the incurred loss method we used in prior periods for determining the provision for credit losses and the ACL.Under CECL, we record an expected loss of all cash flows we do not expect to collect at the inception of the loan. The adoption of the CECL resulted in an increase in our ACL of $90,584, which did not impact our consolidated income statement. We recorded provision for credit losses of $136,577 for the three months ended March 31, 2020 utilizing the CECL methodology a significant increase compared to prior periods. The increase was mainly due to our reserve build related to the COVID-19 pandemic, which was mainly the result of an increase in modeled expected credit losses as a result of changes in the macroeconomic forecasts.
29
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)
The table below presents the allowance for loan losses roll forward for the three months ended March 31, 2019 under the former incurred loss methodology.

 For the three months ended March 31, 2019
 Beginning
balance		Charge-offsRecoveriesNet
charge-offs		Provision / (credit)Ending balance
Traditional C&I
$14,201  $(4,839) $139  $(4,700) $8,435  $17,936  
Asset-based lending
7,979  —  —  —  594  8,573  
Payroll finance
2,738  —  1  1  (639) 2,100  
Warehouse lending
2,800  —  —  —  (2,107) 693  
Factored receivables
1,064  (32) 121  89  (61) 1,092  
Equipment financing
12,450  (1,249) 131  (1,118) 2,994  14,326  
Public sector finance
1,739  —  —  —  (605) 1,134  
CRE
32,285  (17) 9  (8) 810  33,087  
Multi-family
8,355  —  103  103  201  8,659  
ADC
1,769  —  —  —  143  1,912  
Residential mortgage
7,454  (1,085) 1  (1,084) 555  6,925  
Consumer
2,843  (443) 243  (200) (120) 2,523  
Total allowance for loan losses
$95,677  $(7,665) $748  $(6,917) $10,200  $98,960  
Annualized net charge-offs to average loans outstanding:0.14 %


Credit Quality Indicators
As part of the ongoing monitoring of the credit quality of our loan portfolio, management tracks certain credit quality indicators, including trends related to: (i) the weighted-average risk grade of commercial loans; (ii) the level of classified commercial loans; (iii) the delinquency status of residential mortgage and consumer loans, including home equity lines of credit (“HELOC”) and other consumer loans; (iv) net charge-offs; (v) non-performing loans (see details above); and (vi) the general economic conditions in the greater New York metropolitan region. We analyze loans individually by classifying the loans by credit risk, except residential mortgage loans, HELOC and other consumer loans, which are evaluated on a homogeneous pool basis unless the loan balance is greater than $750. This analysis is performed at least quarterly on all graded 7-Special Mention and lower loans. We use the following definitions of risk ratings:

1 and 2 - These grades include loans that are secured by cash, marketable securities or cash surrender value of life insurance policies.

3 - This grade includes loans to borrowers with strong earnings and cash flow that have the ability to service debt. The borrower’s assets and liabilities are generally well-matched and are above average quality. The borrower has ready access to multiple sources of funding, including alternatives such as term loans, private equity placements or trade credit.

4 - This grade includes loans to borrowers with above average cash flow, adequate earnings and debt service coverage ratios. The borrower generates discretionary cash flow, assets and liabilities are reasonably matched, and the borrower has access to other sources of debt funding or additional trade credit at market rates.

5 - This grade includes loans to borrowers with adequate earnings and cash flow and reasonable debt service coverage ratios. Overall leverage is acceptable and there is average reliance upon trade credit. Management has a reasonable amount of experience and depth, and owners are willing to invest available outside capital, as necessary.

6 - This grade includes loans to borrowers where there is evidence of some strain, earnings are inconsistent and volatile, and the borrowers’ outlook is uncertain. Generally, such borrowers have higher leverage than those with a better risk rating. These borrowers typically have limited access to alternative sources of bank debt and may be dependent upon debt funding for working capital support.

7 - Special Mention (OCC definition) - Other Assets Especially Mentioned are loans that have potential weaknesses which may, if not reversed or corrected, weaken the asset or inadequately protect the Bank’s credit position at some future date. Such assets constitute an
30
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)
undue and unwarranted credit risk but not to the point of justifying a classification of “Substandard.” The credit risk may be relatively minor yet constitute an unwarranted risk in light of the circumstances surrounding a specific asset.

8 - Substandard (OCC definition) - These loans are inadequately protected by the current sound worth and paying capacity of the obligor or of the collateral pledged, if any. Assets so classified must have a well-defined weakness that jeopardizes the liquidation of the debt. They are characterized by the distinct possibility that the Bank will sustain some losses if the deficiencies are not corrected. Loss potential, while existing in the aggregate amount of substandard assets, does not have to exist in individual assets classified as substandard.

9 - Doubtful (OCC definition) - These loans have all the weakness inherent in one classified as “Substandard” with the added characteristics that the weakness makes collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable. The possibility of loss is extremely high, but, because of certain important and reasonably specific pending factors which may work to the advantage and strengthening of the asset, its classification as an estimated loss is deferred until its more exact status may be determined. Pending factors may include a proposed merger, acquisition, liquidating procedures, capital injection, perfecting liens or additional collateral and refinancing plans.

10 - Loss (OCC definition) - These loans are charged-off because they are determined to be uncollectible and unbankable assets. This classification does not indicate that the asset has no absolute recovery or salvage value, but rather it is not practical or desirable to defer writing-off this asset even though partial recovery may be effected in the future. Losses should be taken in the period in which they are determined to be uncollectible.

Loans that are risk-rated 1 through 6 as defined above are considered to be pass-rated loans. As of March 31, 2020 and December 31, 2019, the risk category of non-pass rated loans by segment was as follows:
March 31, 2020December 31, 2019
 Special Mention SubstandardSpecial Mention Substandard
Traditional C&I$3,740  $37,202  $8,403  $39,470  
Asset-based lending63,230  87,357  78,445  24,508  
Payroll finance—  8,684  437  17,156  
Factored receivables—  8,445  —  —  
Equipment financing15,556  68,477  25,897  42,503  
CRE27,149  74,213  26,363  79,992  
Multi-family18,419  14,847  18,463  16,247  
ADC1,855  30,434  1,855  505  
Residential mortgage2,379  61,147  93  62,771  
Consumer28  11,587  20  12,276  
Total$132,356  $402,393  $159,976  $295,428  

At March 31, 2020 and December 31, 2019, there were no loans rated doubtful or loss.
31
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)
We evaluate whether a modification, extension or renewal of a loan is a current period origination in accordance with GAAP. Generally loans up for renewal are subject to a full credit evaluation before the renewal is granted and such loans are considered current period originations for purpose of the table below. At March 31, 2020, our loans based on year of origination and risk designation is as follows:
Term loans amortized cost basis by origination year
20202019201820172016PriorRevolving loansRevolving loans converted to termTotal
Traditional C&I
Pass$94,508  $333,276  $380,970  $185,889  $105,894  $147,600  $1,456,713  $—  $2,704,850  
Special mention—  16  —  110  54  782  2,778  —  3,740  
Substandard—  1,967  6,471  393  —  15,105  13,266  —  37,202  
Total traditional C&I94,508  335,259  387,441  186,392  105,948  163,487  1,472,757  —  2,745,792  
Asset-Based Loans
Pass6,624  5,049  3,697  44,412  46,091  18,277  800,355  —  924,505  
Special mention—  —  —  —  —  —  63,230  —  63,230  
Substandard—  —  —  —  2,618  2,895  81,844  —  87,357  
Total asset-based lending6,624  5,049  3,697  44,412  48,709  21,172  945,429  —  1,075,092  
Payroll Finance
Pass—  —  12,813  —  —  —  158,057  —  170,870  
Special mention—  —  —  —  —  —  —  —  —  
Substandard—  —  —  —  —  —  8,684  —  8,684  
Total payroll finance—  —  12,813  —  —  —  166,741  —  179,554  
Warehouse lending
Pass—  75,405  176,653  151,247  471,311  481,661  —  —  1,356,277  
Special mention—  —  —  —  —  —  —  —  —  
Substandard—  —  —  —  —  —  —  —  —  
Total warehouse lending—  75,405  176,653  151,247  471,311  481,661  —  —  1,356,277  
Factored receivables
Pass—  —  —  —  —  —  216,699  —  216,699  
Special mention—  —  —  —  —  —  —  —  —  
Substandard—  —  —  —  —  —  8,445  —  8,445  
Total factored receivables—  —  —  —  —  —  225,144  —  225,144  
Equipment Financing
Pass112,242  691,684  363,478  198,191  143,380  74,515  —  —  1,583,490  
Special mention—  2,526  5,190  4,050  2,265  1,525  —  —  15,556  
32
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)
Substandard—  27,570  16,088  13,393  5,713  5,713  —  —  68,477  
Total equipment financing112,242  721,780  384,756  215,634  151,358  81,753  —  —  1,667,523  
Public sector finance
Pass29,421  417,031  219,259  298,361  193,624  76,396  —  —  1,234,092  
Special mention—  —  —  —  —  —  —  —  —  
Substandard—  —  —  —  —  —  —  —  —  
Total public sector finance29,421  417,031  219,259  298,361  193,624  76,396  —  —  1,234,092  
CRE
Pass427,916  1,500,026  1,006,180  584,851  637,028  1,407,080  —  —  5,563,081  
Special mention—  1,978  247  6,399  —  18,525  —  —  27,149  
Substandard—  12,795  122  2,338  20,547  38,411  —  —  74,213  
Total CRE427,916  1,514,799  1,006,549  593,588  657,575  1,464,016  —  —  5,664,443  
Multi-family
Pass95,570  807,485  428,984  710,885  720,547  1,884,037  54,349  —  4,701,857  
Special mention—  —  —  —  —  18,419  —  —  18,419  
Substandard—  —  —  —  —  14,772  75  —  14,847  
Total multi-family95,570  807,485  428,984  710,885  720,547  1,917,228  54,424  —  4,735,123  
ADC
Pass19,796  179,868  174,291  89,297  25,543  3,630  —  —  492,425  
Special mention—  —  —  1,855  —  —  —  —  1,855  
Substandard—  —  —  30,000  —  434  —  —  30,434  
Total ADC19,796  179,868  174,291  121,152  25,543  4,064  —  —  524,714  
Residential
Pass772  13,449  59,474  55,951  147,410  1,736,952  —  —  2,014,008  
Special mention—  —  —  —  —  2,379  —  —  2,379  
Substandard—  —  —  332  401  60,414  —  —  61,147  
Total residential772  13,449  59,474  56,283  147,811  1,799,745  —  —  2,077,534  
Consumer
Pass52  488  664  574  280  6,440  129,410  75,146  213,054  
Special mention—  —  —  —  —  6  20  2  28  
Substandard—  —  —  —  —  436  3,957  7,194  11,587  
Total consumer52  488  664  574  280  6,882  133,387  82,342  224,669  
Total Loans$786,901  $4,070,613  $2,854,581  $2,378,528  $2,522,706  $6,016,404  $2,997,882  $82,342  $21,709,957  

33
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)
(6) Goodwill and Other Intangible Assets

The balance of goodwill and other intangible assets for the periods presented were as follows:
March 31,December 31,
20202019
Goodwill$1,683,482  $1,683,482  
Other intangible assets:
Core deposits$81,894  $85,922  
Customer lists3,770  3,942  
Trade name20,500  20,500  
Total$106,164  $110,364  

The decrease in other intangible assets at March 31, 2020 compared to December 31, 2019 was due to amortization of intangibles.

The estimated aggregate future amortization expense for intangible assets remaining as of March 31, 2020 was as follows:
Amortization expense
Remainder of 2020$12,600  
202115,104  
202213,703  
202312,322  
202410,448  
20258,722  
Thereafter12,765  
Total$85,664  


(7) Deposits

Deposit balances at March 31, 2020 and December 31, 2019 were as follows: 
 March 31,December 31,
 20202019
Non-interest bearing demand$4,369,924  $4,304,943  
Interest bearing demand4,665,521  4,427,012  
Savings2,756,206  2,652,764  
Money market7,807,057  7,585,888  
Certificates of deposit2,959,572  3,448,051  
Total deposits$22,558,280  $22,418,658  
Total municipal deposits, which are included in the deposit balances above, were $2,091,259 and $1,988,047 at March 31, 2020 and December 31, 2019, respectively. See Note 3. “Securities” for the aggregate amount of securities that were pledged as collateral for municipal deposits and other purposes.  
34
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)
Brokered deposits at March 31, 2020 and December 31, 2019 were as follows:
March 31,December 31,
 20202019
Interest bearing demand$173,790  $149,566  
Money market1,210,112  944,627  
Certificates of deposits467,691  772,251  
Total brokered deposits$1,851,593  $1,866,444  

(8) Borrowings

Our borrowings and weighted average interest rates were as follows for the periods presented: 
 March 31,December 31,
 20202019
 AmountRateAmountRate
By type of borrowing:
FHLB borrowings$1,955,451  1.69 %$2,245,653  2.04 %
Repurchase agreements27,562  1.18  22,678  1.20  
3.50% Senior Notes
171,422  3.19  173,504  3.19  
Subordinated Notes - Company271,019  4.17  270,941  4.17  
Subordinated Notes - Bank173,244  5.45  173,182  5.45  
Total borrowings$2,598,698  2.30 %$2,885,958  2.53 %
By remaining period to maturity:
Less than one year$1,329,263  1.65 %$1,491,446  2.19 %
One to two years800,172  2.07  925,388  2.07  
Two to three years25,000  1.71  25,000  1.71  
Greater than five years444,263  4.67  444,124  4.67  
Total borrowings$2,598,698  2.30 %$2,885,958  2.53 %

FHLB borrowings. As a member of the FHLB, the Bank may borrow up to a discounted percentage of the amount of eligible mortgages and securities that have been pledged as collateral under a blanket security agreement. As of March 31, 2020 and December 31, 2019, the Bank had total residential mortgage and CRE loans pledged after discount of $7,739,208 and $7,670,673, respectively. In addition to the pledged mortgages, the Bank had also pledged securities to secure borrowings, which are disclosed in Note 3. “Securities.” As of March 31, 2020, the Bank had unused borrowing capacity at the FHLB of $5,593,328 and may increase such borrowing capacity by pledging securities not required to be pledged for other purposes with a collateral value of approximately $2,317,396. During the quarter ended March 31, 2020, we redeemed $150,000 of FHLB borrowings with a weighted average interest rate of 2.46% and incurred a loss of $753.

(9) Derivatives
We have entered into interest rate swap contracts that are both over-the-counter, or OTC, and those that are exchanged on futures markets such as the Chicago Mercantile Exchange (“CME”) and London Clearing House (“LCH”). At March 31, 2020 and December 31, 2019, the OTC derivatives are included in our consolidated financial statements at the gross fair value amount of the asset (included in other assets) and liability (included in other liabilities), which represents the change in the fair value of the contract since inception. The CME legally characterizes variation margin payments (a payment made based on changes in the fair value of the interest rate swap contracts) as a settlement, referred to as settled-to-market (“STM”). As a result, at March 31, 2020 and December 31, 2019, we posted cash collateral under STMs in the amounts of $101,808 and $43,004, respectively, for the net fair value of our CME and LCH interest rate swap contracts with another financial institution. The increase was mainly due to an increase in swap contracts and changes in the fair value of the underlying interest rate swap contracts, which may change daily, positively or negatively, mainly due to changes in interest rates.

We do not typically require our commercial customers to post cash or securities as collateral on our program of back-to-back swaps. However, certain language is written into the International Swaps and Derivatives Association agreement and loan documents where, in
35
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)
default situations, we are allowed to access collateral supporting the loan relationship to recover any losses suffered on the derivative asset or liability.

Summary information as of March 31, 2020 and December 31, 2019 regarding these derivatives is presented below:
 Notional
amount		Average
maturity (in years)		Weighted
average
fixed rate 		Weighted
average
variable rate		Fair value
March 31, 2020
Included in other assets:
Third-party interest rate swap$81,272  $2,247  
Customer interest rate swap1,894,624  164,185  
Total $1,975,896  5.044.40 %
1 m Libor + 2.19%
$166,432  
Included in other liabilities:
Third-party interest rate swap$1,894,624  $64,608  
Customer interest rate swap81,272  16  
Total$1,975,896  5.044.40 %
1 m Libor + 2.19%
$64,624  
December 31, 2019
Included in other assets:
Third-party interest rate swap$116,874  $15  
Customer interest rate swap1,738,675  67,303  
Total $1,855,549  5.184.50 %
1 m Libor + 2.23%
$67,318  
Included in other liabilities:
Third-party interest rate swap$1,738,675  $23,998  
Customer interest rate swap116,874  316  
Total$1,855,549  5.184.50 %
1 m Libor + 2.23%
$24,314  

36
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)
(10) Income Taxes

Actual income tax expense differs from the tax computed based on pre-tax income and the applicable statutory federal tax rate for the
following reasons:
For the three months ended
 March 31,
 20202019
Income before income tax expense $6,105  $129,911  
Tax at federal statutory rate of 21%1,282  27,281  
State and local income taxes, net of federal tax benefit589  6,690  
Tax exempt interest, net of disallowed interest(7,409) (5,253) 
BOLI income(1,111) (769) 
Low income housing tax credits and other benefits(8,462) (4,347) 
Low income housing investment amortization expense7,401  3,810  
Tax rate adjustment benefit due to CARES Act NOL carryback(21,313) —  
Uncertain tax position reserve11,480  —  
Annual effective tax rate adjustment8,248  —  
Equity-based stock compensation benefit491  (106) 
FDIC insurance premium limitation256  254  
Other, net506  914  
Actual income tax (benefit) expense$(8,042) $28,474  
Effective income tax rate(131.7)%21.9 %

Net deferred tax liabilities were $62,470 at March 31, 2020, compared to $67,570 at December 31, 2019. The change was mainly due to provision for credit loss expense recorded under CECL, which was offset by the removal of the deferred tax asset for the federal net operating loss which is being carried back under the provisions of the CARES Act. No valuation allowance was recorded against any deferred tax assets as of those dates, based upon management’s consideration of historical and anticipated future pre-tax income, and the reversal periods for the items resulting in deferred tax assets and liabilities.

As of March 31, 2020, the accrual for unrecognized gross tax benefits was as follows:
For the three months ended
March 31, 2020
Uncertain tax positions at December 31, 2019$—  
Additions for tax positions related to prior tax years11,480  
Uncertain tax positions at March 31, 2020$11,480  

Significant tax filings that remain open for examination include the following:
•Federal for tax years 2016 through present;
•New York State tax filings for tax years 2015 through present;
•New York City tax filings for tax years 2015 through present; and
•New Jersey State tax filings for tax years 2016 through present.

We are generally no longer subject to examination by federal, state or local taxing authorities for tax years prior to December 31, 2015.

Interest and/or penalties related to income taxes are reported as a component of other non-interest expense.

37
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)
(11) Stock-Based Compensation

The following table summarizes the activity in our stock-based compensation plan for the three months ended March 31, 2020:
Non-vested stock awards/stock units outstandingStock options outstanding
Shares available for grantNumber of sharesWeighted average grant date fair valueNumber of sharesWeighted average exercise price
Balance at January 1, 20203,347,036  2,187,197  $20.96  427,274  $11.15  
Granted(1,181,673) 1,181,673  20.62  —  —  
Stock awards vested (1)
(39,504) (599,485) 21.82  —  —  
Exercised—  —  —  (41,000) 10.10  
Forfeited110,060  (110,060) 20.55  —  —  
Canceled/expired—  —  —  —  —  
Balance at March 31, 20202,235,919  2,659,325  $20.63  386,274  $11.26  
Exercisable at March 31, 2020386,274  $11.26  
(1) The 39,504 shares vested represents performance shares that were granted in February 2017 to certain executives with a three-year measurement period. These shares vested in the first quarter of 2020 at 150.0% of the target amount granted, which resulted in these additional shares being awarded and additional expense of $960 which was recorded in the first quarter of 2020.
The total intrinsic value of outstanding in-the-money stock options and outstanding in-the-money exercisable stock options was $211 at March 31, 2020.

We use an option pricing model to estimate the grant date fair value of stock options granted. There were no stock options granted during the three months ended March 31, 2020 or March 31, 2019.

Stock-based compensation expense is recognized ratably over the requisite service period for all awards. Stock-based compensation expense associated with stock options and non-vested stock awards and the related income tax benefit are presented below:
For the three months ended
March 31,
20202019
Stock options$—  $—  
Non-vested stock awards/performance units6,006  5,123  
Total$6,006  $5,123  
Income tax benefit1,051  1,127  
Proceeds from stock option exercises414  55  

Unrecognized stock-based compensation expense as of March 31, 2020 was as follows:
March 31, 2020
Stock options$—  
Non-vested stock awards/performance units44,945  
Total$44,945  

The weighted average period over which unrecognized non-vested stock awards/performance units expense is expected to be recognized is 2.18 years.


38
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)
(12) Other Non-Interest Expense, Other Assets and Other Liabilities

(a) Other Non-Interest Expense
Other non-interest expense items for the three months ended March 31, 2020 and 2019, respectively, are presented in the following table:
For the three months ended
March 31,
20202019
Other non-interest expense:
Professional fees$5,749  $4,148  
Depreciation expense on operating leases3,492  —  
Advertising and promotion
1,983  991  
Communications1,630  1,895  
Residential mortgage loans servicing1,377  1,608  
Insurance & surety bond premium
1,091  1,062  
Operational losses
605  583  
Other
7,229  6,657  
Total other non-interest expense$23,156  $16,944  

(b) Other Assets
Other assets are presented in the following table. Significant components of the aggregate of other assets are presented separately.
March 31,December 31,
20202019
Other assets:
Low income housing tax credit investments$402,317  $386,824  
Right of use asset for operating leases (see Note 15)107,711  112,226  
Fair value of swaps (see Note 9)
166,432  67,318  
Cash on deposit as swap collateral / net of settlement94,092  93,606  
Operating leases - equipment and vehicles leased to others67,701  72,291  
Other asset balances152,539  108,603  
Total other assets$990,792  $840,868  

Other asset items include current income tax balances, prepaid insurance, prepaid property taxes, prepaid maintenance, accounts receivable and other miscellaneous assets.

(c) Other Liabilities
Other liabilities are presented in the following table. Significant components of the aggregate of other liabilities are presented separately.
March 31,December 31,
20202019
Other liabilities:
Commitment to fund low income housing tax credit investments $242,598  $264,930  
Lease liability (see Note 15)
114,767  118,986  
Payroll finance and factoring liabilities110,036  105,972  
Swap liabilities (see Note 9)
64,624  24,314  
Other liability balances 127,118  179,250  
Total other liability$659,143  $693,452  
39
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)

Other liability balances include deferred taxes, accrued interest payable, accounts payable, accrued liabilities mainly for compensation and benefit plans and other miscellaneous liabilities.

(13) Earnings Per Common Share

The following is a summary of the calculation of earnings per common share (“EPS”):
For the three months ended
 March 31,
 20202019
 Net income available to common stockholders$12,171  $99,448  
Weighted average common shares outstanding for computation of basic EPS
196,344,061  213,157,090  
Common-equivalent shares due to the dilutive effect of stock options and unvested performance share grants(1)
364,977  348,752  
Weighted average common shares for computation of diluted EPS196,709,038  213,505,842  
EPS(2):
Basic$0.06  $0.47  
Diluted0.06  0.47  
(1) Represents incremental shares computed using the treasury stock method.
(2) Anti-dilutive shares are not included in determining diluted EPS. There were 23,590 anti-dilutive shares in the three months ended March 31, 2020 and none in the three months ending March 31, 2019.
(14) Stockholders’ Equity

(a) Regulatory Capital Requirements
Banks and bank holding companies are subject to various regulatory capital requirements administered by the federal banking agencies. Capital adequacy guidelines, and, additionally for banks, prompt corrective action regulations, involve quantitative measures of assets, liabilities, and certain off-balance sheet items calculated under regulatory accounting practices. Capital amounts and classifications are also subject to qualitative judgments by regulators about components, risk-weighting, and other factors.

The Company’s and the Bank’s Common Equity Tier 1 capital consists of common stock and related paid-in capital, net of treasury stock, and retained earnings. In connection with the adoption of the Basel III Capital Rules, we elected to opt-out of the requirement to include most components of accumulated other comprehensive income in Common Equity Tier 1 capital. Common Equity Tier 1 capital for both the Company and the Bank is reduced by goodwill and other intangible assets, net of associated deferred tax liabilities and subject to transition provisions.

Tier 1 capital includes Common Equity Tier 1 capital and additional Tier 1 capital. Total capital includes Tier 1 capital and Tier 2 capital. Tier 2 capital (as defined in the regulations) for both the Bank and us includes a permissible portion of the ACL and $173,244 and $147,201 of the Subordinated Notes, respectively. Tier 2 capital at the Company includes $271,019 of the Subordinated Notes - Company. During the final five years of the term of the Subordinated Notes, the permissible portion eligible for inclusion in Tier 2 capital decreases by 20% annually.

The Common Equity Tier 1, Tier 1 and Total capital ratios are calculated by dividing the respective capital amounts by risk-weighted assets (“RWA”). RWA is calculated based on regulatory requirements and includes total assets, excluding goodwill and other intangible assets, allocated by risk weight category, and certain off-balance-sheet items, among other items.

As permitted by the interim final rule issued on March 27, 2020 by our federal regulatory agency, we elected the option to delay the estimated impact of the adoption of the CECL Standard in our regulatory capital for two years. This two-year delay is in addition to the three-year transition period the agency had already made available. The adoption will delay the effects of CECL on our regulatory capital for the next two years, after which the effects will be phased-in over a three-year period from January 1, 2022 through December 31, 2024. Under the interim final rule, the amount of adjustments to regulatory capital deferred until the phase-in period
40
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)
include both the initial impact of adoption of the CECL Standard at January 1, 2020 and 25% of subsequent changes in our ACL during each quarter of the two-year period ending December 31, 2021.

The following tables present actual and required capital ratios as of March 31, 2020 and December 31, 2019 for us and the Bank under the Basel III Capital Rules. The minimum required capital amounts presented as of March 31, 2020 and December 31, 2019 are based on the fully phased-in provisions of the Basel III Capital Rules. Capital levels required to be considered well-capitalized are based upon prompt corrective action regulations, as amended to reflect the changes under the Basel III Capital Rules.
ActualMinimum capital required - Basel III Required to be considered well- capitalized
Capital amountRatioCapital amountRatioCapital amountRatio
March 31, 2020
Common equity tier 1 to RWA:
Sterling National Bank$2,869,144  12.19 %$1,647,888  7.00 %$1,530,182  6.50 %
Sterling Bancorp2,567,037  10.89  1,649,811  7.00  N/A  N/A  
Tier 1 capital to RWA:
Sterling National Bank2,869,144  12.19 %2,001,007  8.50 %1,883,301  8.00 %
Sterling Bancorp2,704,400  11.47  2,003,342  8.50  N/A  N/A  
Total capital to RWA:
Sterling National Bank3,247,689  13.80 %2,471,832  10.50 %2,354,126  10.00 %
Sterling Bancorp3,237,061  13.73  2,474,717  10.50  N/A  N/A  
Tier 1 leverage ratio:
Sterling National Bank2,869,144  9.99 %1,148,663  4.00 %1,435,829  5.00 %
Sterling Bancorp2,704,400  9.41  1,149,971  4.00  N/A  N/A  

ActualMinimum capital required - Basel III fully phased-inRequired to be considered well- capitalized
Capital amountRatioCapital amountRatioCapital amountRatio
December 31, 2019
Common equity tier 1 to RWA:
Sterling National Bank$2,882,208  12.32 %$1,637,001  7.00 %$1,520,073  6.50 %
Sterling Bancorp2,588,975  11.06  1,638,718  7.00  N/A  N/A
Tier 1 capital to RWA:
Sterling National Bank2,882,208  12.32 %1,987,787  8.50 %1,870,859  8.00 %
Sterling Bancorp2,726,556  11.65  1,989,872  8.50  N/A  N/A  
Total capital to RWA:
Sterling National Bank3,162,282  13.52 %2,455,502  10.50 %2,338,574  10.00 %
Sterling Bancorp3,252,412  13.89  2,458,077  10.50  N/A  N/A  
Tier 1 leverage ratio:
Sterling National Bank2,882,208  10.11 %1,140,570  4.00 %1,425,713  5.00 %
Sterling Bancorp2,726,556  9.55  1,141,603  4.00  N/A  N/A

The Bank and the Company are subject to the regulatory capital requirements administered by the FRB, and, for the Bank, the Office of the Comptroller of the Currency. Regulatory authorities can initiate certain mandatory actions if the Bank or the Company fails to meet the minimum capital requirements, which could have a direct material effect on our financial statements. As of March 31, 2020,
41
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)
and December 31, 2019, the most recent regulatory notifications categorized the Company and the Bank as well capitalized under the regulatory framework for prompt corrective action. There are no conditions or events since that notification that management believes have changed the classification.

(15) Commitments and Contingencies

(a) Off-Balance Sheet Financial Instruments
The contractual or notional amounts of these instruments, which reflect the extent of our involvement in particular classes of off-balance sheet financial instruments, are summarized as follows: 
 March 31,December 31,
 20202019
Loan origination commitments$482,498  $565,392  
Unused lines of credit1,479,853  1,532,702  
Letters of credit300,784  307,287  

We record an ACL- off-balance sheet financial instrument exposures through a charge to other non-interest expense on our consolidated income statements. At March 31, 2020 and December 31, 2019, the ACL -off-balance sheet credit exposures was $6,749 and $654, respectively and was included in other liabilities in our consolidated balance sheets. For the three months ended March 31, 2020 and 2019 credit loss expense for off balance sheet financial instrument exposures was zero. In connection with the adoption of the CECL Standard, we increased the ACL - off-balance sheet credit exposures by $6,095. We did not adjust this amount during the three months ended March 31, 2020 as an increase in applicable loss factors attributed mainly to the impact of COVID-19 was offset by a decline in off-balance sheet financial instrument exposures.

(b) Leases
Future minimum payments for operating leases with initial or remaining terms of one year or more as of March 31, 2020 were as follows:
Remainder of 2020$14,789  
202118,355  
202216,535  
202314,758  
202412,894  
202510,260  
2026 and thereafter45,237  
Total lease payments132,828  
Interest18,061  
Present value of lease liabilities$114,767  
(c) Litigation
We and the Bank are involved in a number of judicial proceedings concerning matters arising from our and its business activities. These include routine legal proceedings arising in the ordinary course of business. These proceedings also include actions brought against us and the Bank with respect to corporate matters and transactions in which we and the Bank are or were involved.

There can be no assurance as to the ultimate outcome of a legal proceeding; however, we and the Bank have generally denied liability in all significant litigation pending against us and intend to defend vigorously each case, other than matters that are determined appropriate to be settled. We and the Bank accrue a liability for legal claims when payments associated with the claims become probable and the costs can be reasonably estimated. The actual costs of resolving legal claims may be substantially higher or lower than the amounts accrued for those claims. At March 31, 2020 and December 31, 2018, we had no significant amounts accrued for litigation.

(16) Fair Value Measurements

42
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)
Fair value is the exchange price that would be received for an asset or paid to transfer a liability (exit price) in an orderly transaction occurring in the principal or most advantageous market for such asset or liability between market participants on the measurement date. In estimating fair value, we use valuation techniques that are consistent with the market approach, the income approach and/or the cost approach. Such valuation techniques are consistently applied. GAAP establishes a fair value hierarchy comprised of three levels of inputs that may be used to measure fair values.

Level 1 Inputs – Unadjusted quoted prices in active markets for identical assets and liabilities that the reporting entity has the ability to access at the measurement date.

Level 2 Inputs – Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These might include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (such as interest rates, volatilities, prepayment speeds, credit risk, etc.) or inputs that are derived principally from, or corroborated by, market data by correlation or other means.

Level 3 Inputs – Unobservable inputs for determining the fair value of assets or liabilities that reflect an entity’s own assumptions about the assumptions that market participants would use in pricing the assets or liabilities.

In general, fair value is based on quoted market prices, when available. If quoted market prices in active markets are not available, fair value is based on internally developed models that primarily use, as inputs, observable market-based parameters. Valuation adjustments may be made to ensure that financial instruments are recorded at fair value. These adjustments may include amounts to reflect counterparty credit quality and our creditworthiness, among other things, as well as unobservable parameters. Any such valuation adjustments are applied consistently over time. Our valuation methodologies may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. While management believes its valuation methodologies are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different estimate of fair value at the reporting date. Furthermore, the reported fair value amounts have not been comprehensively revalued since the presentation dates, and therefore, estimates of fair value after the balance sheet date may differ significantly from the amounts presented herein. A more detailed description of the valuation methodologies used for assets and liabilities measured at fair value is set forth below. Transfers between levels of the fair value hierarchy are recognized on the actual date of the event or circumstances that caused the transfer, which generally coincide with our monthly and/or quarterly valuation process.
Investment Securities AFS
The majority of our available for sale investment securities are reported at fair value utilizing Level 2 inputs. For these securities, we obtain fair value measurements from an independent pricing service. The fair value measurements consider observable data that may include dealer quotes, market spreads, cash flows, the U.S. Treasury yield curve, live trading levels, trade execution data, market consensus prepayment speeds, credit information and the securities’ terms and conditions, among other things.

We review the prices supplied by the independent pricing service, as well as their underlying pricing methodologies, for reasonableness and to ensure such prices are aligned with traditional pricing matrices. In general, we do not purchase investment securities that have a complicated structure. Our entire portfolio consists of traditional investments, nearly all of which are mortgage pass-through securities, state and municipal general obligation or revenue bonds, U.S. agency bullet and callable securities and corporate bonds. Pricing for such instruments is fairly generic and is easily obtained. From time to time, we validate, on a sample basis, prices supplied by the independent pricing service by comparison to prices obtained from third-party sources or derived using internal models.

As of March 31, 2020, management did not believe any of our securities are other-than-temporarily-impaired; however, management reviews all of our securities on at least a quarterly basis to assess whether impairment, if any, is other-than-temporarily-impaired.
 
Derivatives
The fair values of derivatives are based on valuation models using current observable market data (including interest rates and fees), the remaining terms of the agreements and the credit worthiness of the counterparty as of the measurement date, which are considered Level 2 inputs. Our derivatives are traded in an over-the-counter market where quoted market prices are not always available. Our derivatives at March 31, 2020 and December 31, 2019 consisted of interest rate swaps. See Note 9. “Derivatives” for additional information.
 
43
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)
A summary of assets and liabilities at March 31, 2020 and December 31, 2019, respectively, measured at estimated fair value on a recurring basis, is as follows:
March 31, 2020
Fair valueLevel 1 inputsLevel 2 inputsLevel 3 inputs
Assets:
Investment securities available for sale:
Residential MBS:
Agency-backed$1,227,319  $—  $1,227,319  $—  
CMOs/Other MBS497,901  —  497,901  —  
Total residential MBS1,725,220  —  1,725,220  —  
Other securities:
Federal agencies179,242  —  179,242  —  
Corporate 300,560  —  300,560  —  
State and municipal455,813  —  455,813  —  
Total other securities935,615  —  935,615  —  
Total AFS2,660,835  —  2,660,835  —  
Swaps166,432  —  166,432  —  
Total assets$2,827,267  $—  $2,827,267  $—  
Liabilities:
Swaps$64,624  $—  $64,624  $—  
Total liabilities$64,624  $—  $64,624  $—  

December 31, 2019
Fair valueLevel 1 inputsLevel 2 inputsLevel 3 inputs
Assets:
Investment securities available for sale:
Residential MBS:
Agency-backed$1,615,119  $—  $1,615,119  $—  
CMOs/Other MBS512,277  —  512,277  —  
Total residential MBS2,127,396  —  2,127,396  —  
Federal agencies201,138  —  201,138  —  
Corporate320,922  —  320,922  —  
State and municipal446,192  —  446,192  —  
Total other securities968,252  —  968,252  —  
Total AFS3,095,648  —  3,095,648  —  
Swaps67,318  —  67,318  —  
Total assets$3,162,966  $—  $3,162,966  $—  
Liabilities:
Swaps$24,314  $—  $24,314  $—  
Total liabilities$24,314  $—  $24,314  $—  

The following categories of financial assets are not measured at fair value on a recurring basis, but are subject to fair value adjustments in certain circumstances.
44
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)
Collateral Dependent Loans For collateral dependent loans where we determined that foreclosure of the collateral is probable, or where the borrower is experiencing financial difficulty and we expect repayment of the loan to be provided substantially through the operation or sale of the collateral, the ACL is measured based on the difference between the fair value of the collateral and the amortized cost basis of the loan as of the measurement date. For real estate loans, fair value of the loan’s collateral is determined by third party appraisals, which are then adjusted for the estimated selling and closing costs related to liquidation of the collateral. The unobservable inputs may vary depending on the individual assets. We review third party appraisal for appropriateness and adjust the value downward to consider selling and closing costs, which generally range from 4% to 10% of the appraised value. For non-real estate loans, fair value of the loan’s collateral may be determined using an appraisal, net book value per the borrower’s financial statements, or aging reports, adjusted or discounted based on management’s historical knowledge, changes in market conditions from the time of the valuation, and management’s expertise and knowledge of the client and client’s business.
March 31, 2020
Fair valueLevel 1 inputsLevel 2 inputsLevel 3 inputs
Traditional C&I$13,302  $—  $—  $13,302  
Asset-based lending4,943  —  —  4,943  
Equipment financing650  —  —  650  
CRE14,016  —  —  14,016  
Multi-family1,174  —  —  1,174  
Residential mortgage2,924  —  —  2,924  
Consumer2,113  —  —  2,113  
Total collateral dependent loans measured at fair value$39,122  $—  $—  $39,122  

Impaired Loans
Impaired loans subject to non-recurring fair value measurements were $38,103 at December 31, 2019.
December 31, 2019
Fair valueLevel 1 inputsLevel 2 inputsLevel 3 inputs
Traditional C&I$14,515  $—  $—  $14,515  
Asset-based lending3,772  —  —  3,772  
Equipment financing1,794  —  —  1,794  
CRE12,614  —  —  12,614  
Multi-family1,184  —  —  1,184  
Residential mortgage2,924  —  —  2,924  
Consumer1,300  —  —  1,300  
Total impaired loans measured at fair value$38,103  $—  $—  $38,103  
















45
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)
Fair Value of Financial Instruments

The following is a summary of the carrying amounts and estimated fair value of financial assets and liabilities (none of which were held for trading purposes) as of March 31, 2020:
 March 31, 2020
 Carrying
amount
Level 1 inputs
Level 2 inputs
Level 3 inputs
Financial assets:
Cash and cash equivalents$348,636  $348,636  $—  $—  
Securities AFS2,660,835  —  2,660,835  —  
Securities HTM1,956,177  —  2,032,089  —  
Loans held for sale8,124  —  8,124  —  
Portfolio loans, net21,383,513  —  —  21,469,047  
Accrued interest receivable on securities32,791  —  32,791  —  
Accrued interest receivable on loans68,310  —  —  68,310  
FHLB stock and FRB stock240,722  —  —  —  
Swaps166,432  —  166,432  —  
Financial liabilities:
Non-maturity deposits19,598,708  19,598,708  —  —  
Certificates of deposit2,959,572  —  2,973,231  —  
FHLB borrowings1,955,451  —  1,972,293  —  
Other borrowings27,562  —  27,562  —  
Senior Notes171,422  —  170,306  —  
Subordinated Notes - Company271,019  —  267,487  —  
Subordinated Notes - Bank173,244  —  174,685  —  
Mortgage escrow funds96,491  —  96,491  —  
Accrued interest payable on deposits4,144  —  4,144  —  
Accrued interest payable on borrowings12,864  —  12,864  —  
Swaps64,624  —  64,624  —  






















46
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)
The following is a summary of the carrying amounts and estimated fair value of financial assets and liabilities (none of which were held for trading purposes) as of December 31, 2019:
 December 31, 2019
 Carrying
amount
Level 1 inputs
Level 2 inputs
Level 3 inputs
Financial assets:
Cash and cash equivalents$329,151  $329,151  $—  $—  
Securities available for sale3,095,648  —  3,095,648  —  
Securities held to maturity1,979,661  —  2,053,191  —  
Loans held for sale8,125  —  8,125  —  
Portfolio loans, net21,333,974  —  —  21,382,990  
Accrued interest receivable on securities29,308  —  29,308  —  
Accrued interest receivable on loans71,004  —  —  71,004  
FHLB stock and FRB stock251,805  —  —  —  
Swaps67,318  —  67,318  —  
Financial liabilities:
Non-maturity deposits18,970,607  18,970,607  —  —  
Certificates of deposit3,448,051  —  3,444,669  —  
FHLB borrowings2,245,653  —  2,248,851  —  
Other borrowings22,678  —  22,677  —  
Senior Notes173,504  —  173,733  —  
Subordinated Notes444,123  —  453,512  —  
Mortgage escrow funds58,316  —  58,315  —  
Accrued interest payable on deposits 5,427  —  5,427  —  
Accrued interest payable on borrowings8,629  —  8,629  —  
Swaps24,314  —  24,314  —  

(17) Accumulated Other Comprehensive Income

Components of accumulated other comprehensive income were as follows as of the dates shown below:
March 31,December 31,
20202019
Net unrealized holding gain on available for sale securities$92,936  $52,593  
Related income tax (expense) (25,687) (14,537) 
Available for sale securities, net of tax67,249  38,056  
Net unrealized holding loss on securities transferred to held to maturity  (646) (744) 
Related income tax benefit178  206  
Securities transferred to held to maturity, net of tax  (468) (538) 
Net unrealized holding gain on retirement plans1,161  3,728  
Related income tax expense  (321) (1,030) 
Retirement plans, net of tax840  2,698  
Accumulated other comprehensive income  $67,621  $40,216  

47
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)
The following table presents the changes in each component of accumulated other comprehensive income loss (“AOCI”) for the three months ended March 31, 2020 and 2019:
Net unrealized holding gain (loss) on available for sale securitiesNet unrealized holding (loss) gain on securities transferred to held to maturityNet unrealized holding gain (loss) on retirement plansTotal
For the three months ended March 31, 2020
Balance beginning of the period  $38,056  $(538) $2,698  $40,216  
Other comprehensive gain before reclassification  35,280  —  —  35,280  
Amounts reclassified from AOCI  (6,087) 70  (1,858) (7,875) 
Total other comprehensive income (loss) 29,193  70  (1,858) 27,405  
Balance at end of period  $67,249  $(468) $840  $67,621  
For the three months ended March 31, 2019  
Balance beginning of the period  $(75,077) $(2,546) $11,678  $(65,945) 
Other comprehensive income before reclassification  54,508  —  —  54,508  
Securities reclassified from held to maturity to available for sale  (8,548) —  —  (8,548) 
Amounts reclassified from AOCI  9,540  1,749  2,086  13,375  
Total other comprehensive income  55,500  1,749  2,086  59,335  
Balance at end of period  $(19,577) $(797) $13,764  $(6,610) 
Location in consolidated income statements where reclassification from accumulated other comprehensive loss is included  
Net gain (loss) on sale of securities
Interest income on securities
Other non-interest expense


48
Table of Contents
 STERLING BANCORP AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(Dollars in thousands, except share and per share data)
(19) Recently Issued Accounting Standards Not Yet Adopted

ASU 2019-12, “Income Taxes (Topic 740)” (“ASU 2019-12”). ASU 2019-12 simplifies the accounting for income taxes by removing certain exceptions and improves the consistent application of GAAP by clarifying and amending other existing guidance. ASU 2019-012 will be effective for us on January 1, 2021, and is not expected to have a material impact on our consolidated financial statements.

ASU 2020-01 “Investments - Equity Securities (Topic 321), Investments - Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815)” (“ASU 2020-01”) clarifies the interaction of the accounting for equity securities under Topic 321 and investments accounted for under the equity method of accounting in Topic 323, and the accounting for certain forward contracts and purchased options accounted for under Topic 815. ASU 2020-01 will be effective for us on January 1, 2021, and is not expected to have a material impact on our consolidated financial statements.

ASU 2020-04, “Reference Rate Reform (Topic 848)” (“ASU 2020-04”) provides optional expedients and exceptions for applying GAAP to loan and lease agreements, derivative contracts, and other transactions affected by the anticipated transition away from LIBOR toward new interest rate benchmarks. For transactions that are modified because of reference rate reform and that meet certain scope guidance (i) modifications of loan agreements should be accounted for by prospectively adjusting the effective interest rate and the modification will be considered “minor” so that any existing unamortized origination fees/costs would carry forward and continue to be amortized and (ii) modifications of lease agreements should be accounted for as a continuation of the existing agreement with no reassessments of the lease classification and the discount rate or remeasurements of lease payments that otherwise would be required for modifications not accounted for as separate contracts. ASU 2020-04 also provides numerous optional expedients for derivative accounting. ASU 2020-04 is effective March 12, 2020 through December 31, 2022. We may elect to apply ASU 2020-04 for contract modifications as of January 1, 2020, or prospectively from a date within an interim period that includes or is subsequent to March 12, 2020, up to the date that the financial statements are available to be issued. Once elected for a Topic or an Industry Subtopic within the Codification, the amendments in this ASU must be applied prospectively for all eligible contract modifications for that Topic or Industry Subtopic. We anticipate this ASU will simplify any modifications we execute between the selected start date (yet to be determined) and December 31, 2022 that are directly related to LIBOR transition by allowing prospective recognition of the continuation of the contract, rather than extinguishment of the old contract resulting in writing off unamortized fees/costs. We are evaluating the impacts of this ASU and have not yet determined whether LIBOR transition and this ASU will have a material effect on our business operations and consolidated financial statements.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION

We make statements in this report, and we may from time to time make other statements, regarding our outlook or expectations for earnings, revenues, expenses and/or other financial, business or strategic matters regarding or affecting us that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. Forward-looking statements are typically identified by words such as “believe,” “expect,” “anticipate,” “intend,” “outlook,” “target,” “estimate,” “forecast,” “project,” by future conditional verbs such as “will,” “should,” “would,” “could” or “may,” or by variations of such words or by similar expressions. These statements are not historical facts, but instead represent our current expectations, plans or forecasts and are based on the beliefs and assumptions of management and the information available to management at the time that these disclosures were prepared.

Forward-looking statements are subject to numerous assumptions, risks (both known and unknown) and uncertainties, and other factors which change over time. Forward-looking statements speak only as of the date they are made. We do not assume any duty and do not undertake to update our forward-looking statements. Because forward-looking statements are subject to assumptions, risks, uncertainties, and other factors, actual results or future events could differ, possibly materially, from those that we anticipated in our forward-looking statements, and future results could differ materially from our historical performance.

The factors described herein in Part II. Item 1A. Risk Factors or otherwise described in our filings with the SEC, provide examples of risks, uncertainties and events that may cause our actual results to differ materially from the expectations expressed in our forward-looking statements, including, but not limited to:
•our ability to successfully implement growth and strategic initiatives, and to integrate and fully realize cost savings and other benefits we estimate in connection with acquisitions and limit business disruption arising therefrom;
•oversight of the Bank by the Consumer Financial Protection Bureau;
•adverse publicity, regulatory actions or litigation with respect to us or other well-known companies and the financial services industry in general and a failure to satisfy regulatory standards;
49
STERLING BANCORP AND SUBSIDIARIES
•the effects of and changes in monetary and policies of the Board of Governors of the Federal Reserve System and the U.S. Government, respectively;
•our ability to make accurate assumptions and judgments about an appropriate level of allowance for loan losses and the collectability of our loan portfolio, including changes in the level and trend of loan delinquencies and write-offs that may lead to increased losses and non-performing assets in our loan portfolio, result in our allowance for loan losses not being adequate to cover actual losses, and/or require us to materially increase our reserves;
•our use of estimates in determining the fair value of certain of our assets, which estimates may prove to be incorrect and result in significant declines in valuation;
•our ability to manage changes in market interest rates, which could adversely affect our financial condition and results of operations;
•our ability to capitalize on our substantial investments in our information technology and operational infrastructure and systems;
•changes in other economic, competitive, governmental, regulatory and technological factors affecting our markets, operations, pricing, products, services and fees;
•effects of the novel coronavirus disease (COVID-19), which include, but are not limited to, the federal, state and local government actions and reactions to COVID-19, the health of our colleagues and that of our clients, the continuity of our, our clients’ and our third party providers’ operations, the increased likelihood of cyber and payment fraud risk, the continued ability of our borrowers to repay their loans throughout and following the pandemic, the potential decline in collateral values resulting from COVID-19 and its effects, and the resulting impact upon our financial position, results of operations, cash flows and our outlook; and
•our success at managing the risks involved in the foregoing and managing our business.

These risks and uncertainties should be considered in evaluating forward-looking statements, and undue reliance should not be placed on such statements.

Impact of COVID-19
The COVID-19 pandemic has resulted in, and is likely to continue to result in, significant economic disruption affecting our business and the business of our clients. As of the date of this filing, significant uncertainty exists concerning the magnitude of the impact and duration of the COVID-19 pandemic.

Our consolidated financial statements reflect estimates and assumptions we make that affect the reported amounts of assets and liabilities, including the amount of the ACL we established. We considered the impact of COVID-19 on the assumptions and estimates used which had a material adverse effect on our provision for credit losses, and has also resulted in a significant amount of client requests for forbearance, which are in process of review and implementation.

LIBOR Transition and Phase-Out
We have a significant amount of loans, borrowings and swaps that are tied to LIBOR benchmark interest rates. It is anticipated that the LIBOR index will be phased out by the end of 2021 and the Federal Reserve Bank of New York has established the Secured Overnight Financing Rate (“SOFR”) as its recommended alternative to LIBOR. We have created a sub-committee of our Asset Liability Management Committee to address LIBOR transition and phase-out issues. This committee includes personnel from legal, loan operations, risk, IT, credit, business intelligence, treasury, corporate banking, marketing, audit, accounting and corporate development. We are currently reviewing loan documentation, technology systems and procedures we will need to implement for the transition.

General
The following Management’s Discussion and Analysis of Financial Condition and Results of Operations is intended to assist the reader in understanding our financial condition and results of operations. The following discussion and analysis should be read in conjunction with our unaudited consolidated financial statements and the accompanying notes included in Part I, Item 1 of this report and with our audited consolidated financial statements, including the accompanying notes, and Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our 2019 Form 10-K. Operating results discussed herein are not necessarily indicative of the results of any future period.

Tax equivalent adjustments are the result of increasing the income from tax exempt securities by an amount equal to the federal taxes that would be paid if the income were fully taxable based on a 21% effective income tax rate.

Dollar amounts in tables and the accompanying discussion that follows are stated in thousands, except for share and per share amounts and ratios.

50
STERLING BANCORP AND SUBSIDIARIES
Overview and Management Strategy
The Bank operates as a regional bank providing a broad offering of deposit, lending and wealth management products to commercial, consumer and municipal clients in our market area.

Our primary strategic objective is to drive positive operating leverage, which we believe will allow us to generate sustainable growth in revenues and earnings over time. We define operating leverage as the ratio of growth in adjusted total revenue divided by growth in adjusted total operating expenses (a reconciliation of non-GAAP financial measures is included beginning on page 73). To achieve this goal, we focus on the following initiatives:

•Target specific “high value” client segments and geographic markets in which we have competitive advantages.
•Deploy a single point of contact, relationship-based distribution strategy through our commercial banking teams and financial centers.
•Continuously expand and refine our delivery and distribution channels by rationalizing our investments in businesses that do not meet our risk-adjusted return targets and re-allocating our capital and resources to other businesses that are in-line with our commercial banking strategy and risk-adjusted return targets.
•Maximize efficiency through a technology enabled, low-cost operating platform and by controlling operating costs.
•Create a high productivity culture through differentiated compensation programs based on a pay-for-performance philosophy.
•Maintain strong risk management systems and proactively manage enterprise risk.

The Bank targets the following geographic markets: (i) the New York Metro Market, which includes Manhattan and Long Island; and (ii) the New York Suburban Market, which includes Rockland, Orange, Sullivan, Ulster, Putnam and Westchester Counties in New York and Bergen County in New Jersey. The Bank also originates loans and deposits in select markets nationally through our asset-based lending, payroll finance, warehouse lending, factored receivables, equipment finance and public sector finance businesses (collectively, our commercial finance businesses). We believe the Bank operates in an attractive footprint that presents us with significant opportunities to execute our strategy of targeting small and middle market commercial clients and affluent consumers.

We deploy a team-based distribution strategy in which clients are served by a focused and experienced group of relationship managers who are responsible for all aspects of the client relationship and delivery of our products and services. Our commercial banking teams generate significant originations of loans and deposits, which are augmented by strategic portfolio acquisitions. As of March 31, 2020, we had 30 commercial banking teams and 79 full service financial centers. We currently anticipate that we will increase our number of commercial banking teams by three to five annually, while reducing our financial centers as we continue to execute our real estate and financial center consolidation strategy.

Recent Developments
Effective January 1, 2020, we adopted the CECL Standard which increased our ACL - loans by $90,584, our ACL - HTM securities by $796 and our ACL - off-balance sheet credit exposures by $6,095. Net of tax, our equity was reduced $54,254 on January 1, 2020, which was presented as a cumulative effect of a change in accounting principle.

Earnings performance for the first quarter of 2020 included reported net income available to common stockholders of $12,171, or $0.06 per diluted share, and an adjusted net loss available to common stockholders of $3,124, or $0.02 per diluted share. Our provision for credit losses expense was $138,280. As of March 31, 2020, our ACL stood at 1.50% of total loans.

In the first quarter of 2020, we grew spot commercial loan balances by $412,186 relative to December 31, 2019. The increase in commercial loans was offset by $132,578 of run-off of residential mortgage loans. Our commercial loan portfolio grew $2,335,679 compared to March 31, 2019, which includes the portfolio acquisitions discussed in Note 2. “Acquisitions” in the notes to consolidated financial statements. However, the majority of our growth was related to new client relationships and extensions of credit in the normal course of business in our C&I, commercial finance and commercial real estate portfolios.

Total deposits were $22,558,280 at March 31, 2020, and core deposit growth was $155,564 over the linked quarter and $543,293 compared to March 31, 2019. Our loans to deposits ratio was 96.2% at quarter end. Our cost of interest-bearing deposits declined 10 basis points and our cost of total deposits declined eight basis points relative to the linked quarter. We anticipate the current interest rate environment and pricing strategies we have implemented will allow us to continue to meaningfully reduce the cost of our funding liabilities.

51
STERLING BANCORP AND SUBSIDIARIES
In the first quarter of 2020, we repurchased 4,900,759 shares of common stock at a weighted average price of $16.53 per share, for total consideration of $81,032. In the past twelve months we have repurchased 16,210,858 shares of common stock for total consideration of $309,627. Under our approved repurchase program, we have 6,671,776 shares remaining for repurchase at March 31, 2020. We have decided to temporarily suspend our share repurchase activity until the long-term impact of the pandemic becomes more clear.

Our net interest margin and net interest income were pressured by the significant decrease in interest rates and the impact on our floating rate loans indexed to LIBOR and prime rates. Our tax equivalent net interest margin excluding purchase accounting adjustments was 3.05% and our reported net interest margin on a tax equivalent basis was 3.21%. Our net interest income was $211,772, which was impacted by a decrease in accretion income on acquired loans of $8,811 and a decrease in yields on our floating rate loans.

Our adjusted non-interest expenses were $106,277 in the quarter, an increase of $745 over the linked quarter which was mainly due to seasonal fluctuations in compensation and benefits and an increase in professional fees associated with strategic initiatives and a legal settlement. Our reported operating efficiency ratio was 44.3% and our adjusted operating efficiency ratio was 42.4% for the quarter.

Critical Accounting Policies
Our accounting and reporting policies are prepared in accordance with GAAP and conform to general practices within the banking industry. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. While we base estimates on historical experience, current information and other factors deemed to be relevant, actual results could differ from those estimates. We consider accounting estimates to be critical to reported financial results if (i) the accounting estimate requires management to make assumptions about matters that are highly uncertain; and (ii) different estimates that management reasonably could have used for the accounting estimate in the current period, or changes in the accounting estimate that are reasonably likely to occur from period to period, could have a material impact on our financial statements. Accounting policies related to the ACL, business combinations, and deferred income taxes are considered to be critical, as these policies involve considerable subjective judgment and estimation by management. For additional information regarding critical accounting policies, refer to Note 1. “Basis of Financial Statement Presentation” in the notes to consolidated financial statements included elsewhere in this report and the sections captioned “Critical Accounting Policies” and “Allowance for Loan Losses” in Management’s Discussion and Analysis of Financial Condition and Results of Operations included in the 2019 Form 10-K.

ACL - Loans. We consider the methodology for determining the ACL to be a critical accounting policy due to the high degree of judgment involved, the subjectivity of the assumptions utilized and the potential for changes in the economic environment that could result in changes to the amount of the ACL - loans considered necessary. The balance recorded for the allowance represents our estimate of the net amount not expected to be collected on portfolio loans at the balance sheet date. The ACL - loans is mainly comprised of reserves on individual assets estimated by our valuation models. Mortgage warehouse loans and certain consumer loans are evaluated on a pool level basis as each portfolio has common risk characteristics. Generally all other portfolio loans are evaluated individually for expected credit loss. In addition to quantitative amounts as determined by our valuation models, we apply a qualitative factors overlay that incorporates trends and conditions and factors that the models may not fully capture in our judgement. Our methodologies for estimating the ACL - loans considers available relevant information about the collectibility of cash flows, including information about past events, current conditions and reasonable and supportable forecasts See Note 1. “Basis Financial Statement Presentation - (e) Accounting Principle Change” for further discussion of the risk factors we considered in the determination of the allowance for credit losses - loans.

Goodwill and Intangible Assets. We record goodwill as the excess of the purchase price in a business combination over the fair value of the identifiable net assets acquired in accordance with GAAP. We perform our annual goodwill and intangible assets impairment test in the fourth quarter of each year, or more often if events or circumstances warrant. At March 31, 2020, we performed a qualitative assessment and concluded a goodwill and intangible asset impairment did not exist. We will continue to monitor and evaluate the impact of COVID-19 and its impact on our market capitalization, overall economic conditions and any other triggering events that may indicate an impairment of goodwill in the future. In the event we conclude that all or a portion of our goodwill or intangible assets are impaired, a non-cash charge for the amount of such impairment would be recorded to earnings. Such a charge would have no impact on tangible capital or our regulatory capital ratios.

Financial Impact of Recent Acquisitions
The balances of the commercial loan portfolio acquired from Woodforest were included in our consolidated balance sheets as of February 28, 2019, and the operating results from those assets were included in our results of operations from that day forward.

The balances of the commercial loan portfolio acquired from Santander were included in our consolidated balance sheets as of November 29, 2019, and the operating results from those assets were included in our results from operations from that day forward.
52
STERLING BANCORP AND SUBSIDIARIES

Selected financial condition data, statement of operations data, per share data, performance ratios, capital ratios, and asset quality data and ratios for the comparable periods are presented as follows:
At or for the three months ended March 31,
20202019
End of period balances:
Total securities$4,617,012  $5,915,050  
Portfolio loans21,709,957  19,908,473  
Total assets
30,335,036  29,956,607  
Non-interest bearing deposits
4,369,924  4,321,310  
Interest bearing deposits18,188,356  16,904,329  
Total deposits22,558,280  21,225,639  
Borrowings2,598,698  3,633,480  
Stockholders’ equity4,422,424  4,419,223  
Tangible common stockholders’ equity (“TCE”)1
2,495,415  2,498,472  
Average balances:
Total securities
$5,046,573  $6,334,694  
Total loans2
21,206,177  20,412,274  
Total assets30,484,433  30,742,943  
Non-interest bearing deposits4,346,518  4,247,389  
Interest bearing deposits18,346,050  17,068,737  
Total deposits and mortgage escrow22,692,568  21,316,126  
Borrowings2,580,922  4,466,172  
Stockholders’ equity4,506,537  4,415,449  
TCE1
2,576,558  2,520,595  
Selected operating data:
Total interest and dividend income$273,527  $309,400  
Total interest expense
61,755  73,894  
Net interest income211,772  235,506  
Provision for credit losses138,280  10,200  
Net interest income after provision for credit losses73,492  225,306  
Total non-interest income47,326  19,597  
Total non-interest expense114,713  114,992  
Income before income tax expense
6,105  129,911  
Income tax (benefit) expense(8,042) 28,474  
Net income
14,147  101,437  
Preferred stock dividend
1,976  1,989  
Net income available to common stockholders
$12,171  $99,448  
Per share data:
Reported basic EPS (GAAP)$0.06  $0.47  
Reported diluted EPS (GAAP)
0.06  0.47  
Adjusted diluted EPS1 (non-GAAP)
(0.02) 0.50  
Dividends declared per common share0.07  0.07  
Book value per share22.04  20.43  
Tangible book value per common share1
12.83  11.92  
53
STERLING BANCORP AND SUBSIDIARIES
See legend on following page.

At or for the three months ended March 31,
20202019
Common shares outstanding:
Shares outstanding at period end194,460,656  209,560,824  
Weighted average shares basic
196,344,061  213,157,090  
Weighted average shares diluted
196,709,038  213,505,842  
Other data:
Full time equivalent employees at period end
1,619  1,855  
Financial centers at period end79  99  
Performance ratios:
Return on average assets
0.16 %1.31 %
Return on average equity
1.09  9.13  
Reported return on average tangible assets1
0.17  1.39  
Adjusted return on average tangible assets1
(0.04) 1.48  
Reported return on average TCE1
1.90  16.00  
Adjusted return on average TCE1
(0.49) 17.04  
Reported operating efficiency1
44.3  45.1  
Adjusted operating efficiency1
42.4  40.5  
Net interest margin-GAAP3.16  3.48  
Net interest margin-tax equivalent3
3.21  3.54  
Capital ratios (Company)4:
Tier 1 leverage ratio9.41 %9.21 %
Common equity Tier 1 capital ratio
10.89  11.98  
Tier 1 risk-based capital ratio
11.47  12.63  
Total risk-based capital ratio
13.73  13.78  
Tangible equity to tangible assets
9.22  9.36  
Tangible common equity to tangible assets1
8.74  8.87  
Regulatory capital ratios (Bank)4:
Tier 1 leverage ratio
9.99 %9.58 %
Tier 1 risk-based capital ratio
12.19  13.13  
Total risk-based capital ratio
13.80  14.41  
Asset quality data and ratios:
Allowance for credit losses
$326,444  $98,960  
Non-performing loans (“NPLs”)
253,750  170,415  
Non-performing assets (“NPAs”)
265,565  189,792  
Net charge-offs
6,955  6,917  
NPAs to total assets
0.88 %0.62 %
NPLs to total loans5
1.17  0.86  
Allowance for loan losses to non-performing loans
128.65  58.07  
Allowance for loan losses to total loans4
1.50  0.50  
Annualized net charge-offs to average loans
0.13  0.14  
__________________
1 See a reconciliation of as reported financial measures to as adjusted (non-GAAP) financial measures beginning on page 73 below under the caption “Supplemental Reporting of Non-GAAP Financial Measures.”
2 Includes loans held for sale but excludes the allowance for credit losses.
3 Tax equivalent basis represents interest income earned on municipal securities divided by the applicable Federal tax rate of 21%.
54
STERLING BANCORP AND SUBSIDIARIES
4 We elected the five-year capital phase-in option effective March 31, 2020.
5 Total loans excludes loans held for sale.

Results of Operations
For the three months ended March 31, 2020, we reported net income available to common stockholders of $12,171, or $0.06 per diluted common share, compared to net income available to common stockholders of $99,448, or $0.47 per diluted common share, for the three months ended March 31, 2019.

Details of the changes in the various components of net income available to common stockholders are further discussed below.

Net Interest Income is the difference between interest income on earning assets, such as loans and securities, and interest expense on liabilities, such as deposits and borrowings, which are used to fund those assets. Net interest income is our largest source of revenue, representing 81.7% and 92.3% of total revenue in the three months ended March 31, 2020 and 2019, respectively. Net interest margin is the ratio of taxable equivalent net interest income to average earning assets for the period. The level of interest rates and the volume and mix of earning assets and interest bearing liabilities impact net interest income and net interest margin.

We are primarily funded by core deposits. Core deposits include retail, commercial and municipal transaction deposits, money market and savings accounts and certificates of deposit accounts, including reciprocal brokered deposits through the Promontory Interfinancial Network, but excluding other brokered and wholesale deposits. As of March 31, 2020, we considered 91.8% of our total deposits to be core deposits compared to 95.0% at March 31, 2019. Non-interest bearing demand deposits were $4,369,924 of our total deposits at March 31, 2020, compared to $4,321,310 at March 31, 2019. We believe that our low cost deposit funding base will assist in offsetting a portion of the decline in interest income as a result of the decline in market rates of interest as liabilities mature and we continue our deposit repricing strategy.

The following tables set forth average balance sheets, interest, average yields and costs, and certain other information for the periods indicated. All average balances are daily average balances. Non-accrual loans were included in the computation of average balances, but have been reflected in the table as loans carrying a zero yield. The yields set forth below include the effect of deferred fees, discounts and premiums that are amortized or accreted to interest income or expense.

55
STERLING BANCORP AND SUBSIDIARIES
 For the three months ended March 31,
 20202019
 Average
balance		InterestYield/RateAverage
balance		InterestYield/Rate
Interest earning assets:
Traditional C&I and commercial finance loans$8,034,108  $89,150  4.46 %$6,568,136  $88,908  5.49 %
CRE (includes multi-family)10,288,977  110,742  4.33  9,385,420  114,855  4.96  
ADC497,009  6,320  5.11  284,299  4,341  6.19  
Commercial loans18,820,094  206,212  4.41  16,237,855  208,104  5.20  
Consumer loans233,643  2,939  5.06  295,428  4,096  5.62  
Residential mortgage loans2,152,440  26,288  4.89  3,878,991  48,095  4.96  
Total gross loans1
21,206,177  235,439  4.47  20,412,274  260,295  5.17  
Securities taxable2,883,367  20,629  2.88  3,833,690  27,847  2.95  
Securities non-taxable2,163,206  16,451  3.04  2,501,004  18,806  3.01  
Interest earning deposits489,691  1,832  1.50  331,954  1,501  1.83  
FRB and FHLB stock237,820  2,630  4.45  335,302  4,900  5.93  
Total securities and other earning assets
5,774,084  41,542  2.89  7,001,950  53,054  3.07  
Total interest earning assets
26,980,261  276,981  4.13  27,414,224  313,349  4.64  
Non-interest earning assets3,504,172  3,328,719  
Total assets$30,484,433  $30,742,943  
Interest bearing liabilities:
Interest bearing demand deposits$4,616,658  $9,558  0.83 %$4,334,266  $11,643  1.09 %
Savings deposits2
2,800,021  3,506  0.50  2,460,247  1,784  0.29  
Money market deposits7,691,381  18,396  0.96  7,776,501  22,616  1.18  
Certificates of deposit3,237,990  14,321  1.78  2,497,723  9,952  1.62  
Total interest bearing deposits18,346,050  45,781  1.00  17,068,737  45,995  1.09  
Senior Notes173,323  1,434  3.31  179,439  1,412  3.15  
Other borrowings1,963,428  9,353  1.92  4,113,770  24,132  2.38  
Subordinated Notes - Bank173,203  2,360  5.45 %172,963  2,355  5.45 %
Subordinated Notes - Company
270,968  2,827  4.17  —  —  —  
Total borrowings
2,580,922  15,974  2.49  4,466,172  27,899  2.53  
Total interest bearing liabilities
20,926,972  61,755  1.19  21,534,909  73,894  1.39  
Non-interest bearing deposits4,346,518  4,247,389  
Other non-interest bearing liabilities
704,406  545,196  
Total liabilities25,977,896  26,327,494  
Stockholders’ equity4,506,537  4,415,449  
Total liabilities and stockholders’ equity
$30,484,433  $30,742,943  
Net interest rate spread3
2.94 %3.25 %
Net interest earning assets4
$6,053,289  $5,879,315  
Net interest margin - tax equivalent215,226  3.21 %239,455  3.54 %
Less tax equivalent adjustment
(3,454) (3,949) 
Net interest income211,772  235,506  
Accretion income on acquired loans
10,686  25,580  
Tax equivalent net interest margin excluding accretion income on acquired loans
$204,540  3.05 %$213,875  3.16 %
Ratio of interest earning assets to interest bearing liabilities
128.9 %127.3 %
See legend on following page.
56
STERLING BANCORP AND SUBSIDIARIES
1 Average balances include loans held for sale and non-accrual loans. Includes the effect of net deferred loan origination fees, amortization of premiums, accretion of discounts and costs and non-accrual loans. Interest includes prepayment fees and late charges.
2 Includes club accounts and interest bearing mortgage escrow balances.
3 Net interest rate spread represents the difference between the tax equivalent yield on average interest earning assets and the cost of average interest bearing liabilities.
4 Net interest earning assets represents total interest earning assets less total interest bearing liabilities.

The following table presents the dollar amount of changes in interest income (on a fully tax equivalent basis) and interest expense for the major categories of our interest earning assets and interest bearing liabilities for the periods indicated. Information is provided for each category of interest earning assets and interest bearing liabilities with respect to (i) changes attributable to changes in volume (i.e., changes in average balances multiplied by the prior period average rate); and (ii) changes attributable to changes in rate (i.e., changes in average rate multiplied by prior period average balances). For purposes of this table, changes attributable to both rate and volume, which cannot be segregated, have been allocated proportionately to the change due to volume and the change due to rate.
For the three months ended March 31,
 2020 vs 2019
 Increase / (Decrease)
due to		Total
increase /
 VolumeRate(decrease)
Interest earning assets:
Traditional C&I and commercial finance loans$18,409  $(18,167) $242  
CRE (includes multi-family)10,904  (15,017) (4,113) 
ADC2,843  (864) 1,979  
Commercial loans32,156  (34,048) (1,892) 
Consumer loans(784) (373) (1,157) 
Residential mortgage loans(21,137) (670) (21,807) 
Total loans10,235  (35,091) (24,856) 
Securities taxable(6,588) (630) (7,218) 
Securities tax exempt(2,541) 186  (2,355) 
Interest earning deposits635  (304) 331  
FRB and FHLB stock(1,221) (1,049) (2,270) 
Total interest earning assets520  (36,888) (36,368) 
Interest bearing liabilities:
Interest bearing demand deposits755  (2,840) (2,085) 
Savings deposits1
276  1,446  1,722  
Money market deposits(234) (3,986) (4,220) 
Certificates of deposit3,277  1,092  4,369  
Total interest bearing deposits4,074  (4,288) (214) 
Senior Notes(48) 70  22  
Other borrowings(10,819) (3,960) (14,779) 
Subordinated Notes - Bank5  —  5  
Subordinated Notes - Company2,827  —  2,827  
Total borrowings(8,035) (3,890) (11,925) 
Total interest bearing liabilities(3,961) (8,178) (12,139) 
Change in tax equivalent net interest income4,481  (28,710) (24,229) 
Less tax equivalent adjustment(495) —  (495) 
Change in net interest income$4,976  $(28,710) $(23,734) 
______________________
1 Includes club accounts and interest bearing mortgage escrow balances.
57
STERLING BANCORP AND SUBSIDIARIES
Tax equivalent net interest income decreased $24,229 for the three months ended March 31, 2020, compared to the three months ended March 31, 2019. The decrease was mainly due to a decrease in yield on interest earning assets and a decrease in accretion income on acquired loans. For the three months ended March 31, 2020, total interest earning assets yielded 4.13% compared to 4.64% during 2019, as rates on adjustable rate loans have decreased with market interest rates. Average interest earning assets declined by $433,963 between the periods, which was mainly due to the sale of investment securities. The tax equivalent net interest margin decreased 33 basis points to 3.21% in the first quarter of 2020 from 3.54% in the first quarter of 2019. The percentage of loans to average earning assets increased to 78.6% compared to 74.5% in 2019. The cost of interest bearing liabilities declined to 1.19% compared to 1.39% in 2019, which was mainly due to lower reliance on borrowings to fund interest earning assets.

The average balance of loans outstanding increased $793,903 for the three months ended March 31, 2020 compared to the three months ended March 31, 2019. The increase was due to loans originated by our commercial banking teams and the two portfolio acquisitions, discussed in Note 2. “Acquisitions. The average balance of commercial loans increased $2,582,239 between the periods. The average yield on loans was 4.47% compared to 5.17% in the comparable year ago period. The decrease in the yield on loans was due to the change in market rates of interest and a decline in accretion income on acquired loans, which was $10,686 compared to $25,580 in 2019.

Interest income on traditional C&I and commercial finance loans increased $242 for the three months ended March 31, 2020 compared to the three months ended March 31, 2019. This increase was mainly due to higher average loan balances as a result of organic loan growth and loan portfolio acquisitions. The yield on traditional C&I and commercial finance loans declined to 4.46% compared to 5.49% in 2019. The decrease in yield was due to a change in the mix of business, as lower yielding mortgage warehouse and public sector finance loans were a substantial portion of the increase in average balances between the periods, and the decrease in market interest rates.

Interest income on CRE loans and multi-family loans decreased $4,113 for the three months ended March 31, 2020 compared to the three months ended March 31, 2019. The average balance of CRE and multi-family loans increased $903,557 between the periods. The yield on CRE and multi-family loans was 4.33% compared to 4.96% for the three months ended March 31, 2019. The decrease in yield was mainly due to a change in market interest rates and lower levels of prepayment penalties.

Interest income on residential mortgage loans declined $21,807 for the three months ended March 31, 2020 compared to the three months ended March 31, 2019. The decrease was mainly due to a $1,726,551 decline in the average balance of residential mortgage loans, which was driven by the residential mortgage loan sales completed in 2019 and continued run-off of the portfolio. The yield on residential mortgage loans decreased 7 basis points to 4.89% compared to 4.96% in 2019. The decline in yield was mainly due to lower accretion income on acquired residential mortgage loans, which was $3,177 compared to $8,297 in 2019.

Tax equivalent interest income on securities decreased $9,573 for the three months ended March 31, 2020, compared to the three months ended March 31, 2019. This was mainly the result of a decrease of $1,288,121 in the average balance of securities between the periods. The tax equivalent yield on securities decreased to 2.96% compared to 2.99% in 2019. The decrease was mainly due to sales of corporate securities and accelerated repayments of mortgage backed securities, which increased premium amortization. The average balance of tax-exempt securities declined to $2,163,206, compared to $2,501,004.

Average total deposits and mortgage escrow increased $1,376,442 in the three months ended March 31, 2020, compared to the three months ended March 31, 2019. Average interest bearing deposits increased $1,277,313 and average non-interest bearing deposits increased to $4,346,518. The increase in interest bearing deposits was mainly due to success of our deposit gathering strategies, which included digital channels and increasing penetration in our marketplace of commercial and municipal deposit relationships. The average cost of interest bearing deposits was 1.00% compared to 1.09%. The average cost of total deposits was 0.81% compared to 0.88% in the first quarter of 2019. The decrease in the cost of deposits was mainly due to declines in market interest rates, partially offset by the competitive environment for deposits in the greater New York metropolitan region.

Average borrowings declined $1,885,250 in the three months ended March 31, 2020, compared to the same period a year ago. The decrease was mainly the result of an increase in deposits and a decline in residential mortgage loan balances and investment securities between the periods, as proceeds from the sales were used mainly to reduce borrowings. The average cost of borrowings was 2.49% for the first quarter of 2020, compared to 2.53% in 2019.

Provision for Credit Losses - Loans. The provision for credit losses - loans is determined as the amount to be added to the ACL - loans after net charge-offs have been deducted to bring the allowance to a level that is our best estimate of the net amount not expected to be collected on portfolio loans. For the three months ended March 31, 2020 and March 31, 2019, the provision for credit losses - loans was $136,577 and $10,200, respectively. See the section captioned “Non-Performing Loans (“NPLs”) and Non-Performing Assets (“NPAs”)” later in this discussion for further analysis of the provision for credit losses.

58
STERLING BANCORP AND SUBSIDIARIES
Provision for Credit Losses - HTM Securities. The provision for credit losses - HTM securities for the three months ended March 31, 2020 was $1,703. This provision was mainly due to a change in the estimate of loss given default due to COVID-19 and deterioration in economic conditions.

Non-interest income. The components of non-interest income were as follows for the periods presented below:
For the three months ended
March 31,
20202019
Deposit fees and service charges$6,622  $6,212  
Accounts receivable management / factoring commissions and other fees
5,538  5,423  
Bank owned life insurance5,018  3,641  
Loan commissions and fees11,024  3,838  
Investment management fees1,847  1,900  
Net gain (loss) on sale of securities8,412  (13,184) 
Net gain on called securities4,880  —  
Gain on sale of residential mortgage loans—  8,313  
Other3,985  3,454  
Total non-interest income$47,326  $19,597  

Non-interest income was $47,326 for the three months ended March 31, 2020, compared to $19,597 in the same period a year ago. Included in non-interest income was a net gain (loss) on sale of securities, which was a gain of $8,412 for the three months ended March 31, 2020 compared to a loss of $13,184 for the three months ended March 31, 2019. Results for the three months ended March 31, 2019 included a gain on sale of residential mortgage loans of $8,313. Net gain (loss) loss on sale of securities is impacted significantly by changes in market interest rates and strategies we use to manage yield, liquidity and interest rate risk, and it is difficult to forecast the amount of net losses or gains consistently. When we analyze the results of our non-interest income, we exclude certain items, including gains and losses on sales of securities and the gain on sale of residential mortgage loans. Excluding net gain (loss) on sale of securities and gain on sale of residential mortgage loans, non-interest income was $38,914 for the first quarter of 2020 compared to $24,468 for the first quarter of 2019.

Deposit fees and service charges were $6,622 for the first quarter of 2020, which represented a $410 increase, which was mainly due to an increase from deposit service charges on deposit accounts driven by a decline in fee waivers.

Bank owned life insurance income represents the change in the cash surrender value of life insurance policies owned by us. BOLI income was $5,018 for the first quarter of 2020, compared to $3,641 in the same period a year ago. In the second half of 2019 we restructured the BOLI acquired in the Astoria Merger, which was the main cause of the increase.

Loan commissions and fee income includes fees on lines of credit, loan servicing fees, loan syndication fees, collateral monitoring, and other loan related fees that are not included in interest income. Loan commissions and fees were $11,024 for the three months ended March 31, 2020, compared to $3,838 for the three months ended March 31, 2019. The increase was mainly due to gain on sale of equipment finance loans of $2,881 and fee income earned on operating leases of $4,314.

Net gain (loss) on sale of securities represents net gains or losses incurred on the sale of securities from our AFS investment securities portfolio. We realized a net gain on sale of securities of $8,412 in the three months ended March 31, 2020 compared to a loss of $13,184 in the three months ended March 31, 2019. The net gain was mainly due to the sale of $407,524 of AFS securities in the first quarter of 2020. The proceeds were used for liquidity management purposes. In the quarter ended March 31, 2019, the loss on sale was mainly due to the sale of $738,751 of AFS securities. The proceeds were used to fund a portion of the commercial loans acquired from Woodforest and to reduce wholesale deposits and borrowings.

Net gain on called securities represents income earned on security calls of $139,777, which were mainly government agency securities.

59
STERLING BANCORP AND SUBSIDIARIES
Gain on sale of residential mortgage loans represents the net gain realized on the sale of residential mortgage loans held for sale in the first quarter of 2019. The sale was part of our strategy of increasing the percentage of commercial loans to total loans in our loan portfolio.

Other non-interest income principally includes fees for loan swaps, safe deposit rentals and foreign exchange fees. Other non-interest income increased to $3,985 in 2020 from $3,454 in 2019 and was mainly due to higher loan swap transaction volumes.

Non-interest expense. The components of non-interest expense were as follows for the periods presented below:
For the three months ended
March 31,
20202019
Compensation and benefits$54,876  $55,990  
Stock-based compensation plans6,006  5,123  
Occupancy and office operations15,199  16,535  
Information technology8,018  8,675  
Amortization of intangible assets4,200  4,826  
FDIC insurance and regulatory assessments3,206  3,338  
OREO, net52  217  
Charge for asset write-downs, retention and severance
—  3,344  
Other non-interest expense23,156  16,944  
Total non-interest expense$114,713  $114,992  

Non-interest expense for the three months ended March 31, 2020 was $114,713, a $279 decrease from $114,992 for the three months ended March 31, 2019. The decrease between the periods was mainly a result of strong management of operating expenses, a decrease in personnel and continued execution of our real estate consolidation strategy. Changes in the components of non-interest expense are discussed below.

Compensation and benefits expense was $54,876 for the three months ended March 31, 2020, compared to $55,990 for the three months ended March 31, 2019. The decrease was mainly due to a decline in our full-time equivalent employees. As of March 31, 2020, our full-time equivalent employees were 1,619 compared to 1,855 at March 31, 2019, which was mainly due to the completion of the Astoria Merger integration and ongoing financial center consolidation strategy.

Stock-based compensation plans expense was $6,006 in the first quarter of 2020, compared to $5,123 in the first quarter of 2019. The increase was due to a greater percentage of compensation paid to our executive management and senior personnel in stock awards to better align the interests of management and employees to those of our stockholders. Performance-based stock awards granted in February 2017 with a three-year measurement period vested in the first quarter of 2019 at 150% of the target amount granted, which resulted in additional expense of $960. For additional information related to our employee benefit plans and stock-based compensation, see Note 11. “Stock-Based Compensation” in the notes to consolidated financial statements included elsewhere in this report.

Occupancy and office operations expense was $15,199 in the first quarter of 2020, compared to $16,535 in the first quarter of 2019. At March 31, 2020, we had 79 financial center locations, compared to 99 financial centers at March 31, 2019.

Information technology expense, which mainly includes the cost of our loan and deposit operating systems and contracted service and maintenance associated with other data processing systems, was $8,018 in the first quarter of 2020, compared to $8,675 in the first quarter of 2019. The decrease in information technology expense was mainly due to a decline in data processing expense.

Amortization of intangible assets expense mainly includes amortization of core deposit intangible assets, customer lists and non-compete agreements. Amortization of intangible assets was $4,200 in the three months ended March 31, 2020, compared to $4,826 for the three months ended March 31, 2019. The decrease in amortization expense was mainly due to the accelerated amortization of the core deposit intangible assets that were recorded in the Astoria Merger and other acquisitions. For additional information, see Note 6. “Goodwill and Other Intangible Assets” in the notes to the consolidated financial statements included elsewhere in this report.

60
STERLING BANCORP AND SUBSIDIARIES
Charge for asset write-downs, severance and retention expense was $0 for the three months ended March 31, 2020 compared to $3,344 for the three months ended March 31, 2019. In the year ago period, in connection with the commercial loan portfolio and origination platform acquired from Woodforest, we incurred a charge that included components related to professional fees, retention and severance, systems integration costs and an impairment of a lease assumed in the transaction.

Other non-interest expense mainly includes professional fees, depreciation expense on operating leases acquired in the Santander Portfolio Acquisition, advertising and promotion, communications, residential mortgage loan servicing, insurance, operational losses, commercial loan processing expenses, pension and post retirement plans, recruitment fees, taxes not included in income tax expense, travel and client entertainment, and colleague training expense. For the three months ended March 31, 2020, other non-interest expense was $23,156, compared to $16,944 for the three months ended March 31, 2019. The increase was mainly due to depreciation expense on operating leases of $3,492, higher professional fees of $1,601, including consulting expenses related to various automation projects, legal fees related to various loan collection and other matters and an increase in advertising and promotion of $996 for targeted deposit gathering efforts.

Income tax benefit was $8,042 for the three months ended March 31, 2020 compared to income tax expense of $28,474 for the three months ended March 31, 2019. We recorded income taxes at an estimated annual effective tax rate of 17.5% for the three months ended March 31, 2020. Note that our estimated effective tax rate may fluctuate based on the amount of provision for credit losses that we record in the remainder of 2020. In addition, there were two discrete items that impacted income tax (benefit) expense in the three months ended March 31, 2020:

•Based on provisions of the CARES Act, we had an NOL carryback that resulted in an income tax benefit of $21,313. We recorded an accrual for uncertain tax positions of $11,480 which is discussed in Note 10. “Income Taxes”. The net of these two items was an income tax benefit of $9,833.
•We recorded income tax expense of $723 due to vesting of stock-based compensation.

For the three months ended March 31, 2019, our income tax expense was recorded at an estimated effective income tax rate of 21.9%. See Note 10. “Income Taxes” in the notes to the consolidated financial statements included elsewhere in this report for additional information.

61
STERLING BANCORP AND SUBSIDIARIES
Portfolio Loans
The following table sets forth the composition of our loan portfolio, excluding loans held for sale, by type of loan at the periods indicated.
 March 31, 2020December 31, 2019
 Amount%Amount%
Commercial:
C&I:
Traditional C&I
$2,745,792  12.6 %$2,355,031  11.0 %
Asset-based lending1,075,092  5.0  1,082,618  5.0  
Payroll finance179,554  0.8  226,866  1.1  
Warehouse lending1,356,277  6.2  1,330,884  6.2  
Factored receivables225,144  1.0  223,638  1.0  
Equipment financing
1,667,523  7.8  1,800,564  8.4  
Public sector finance
1,234,092  5.7  1,213,118  5.7  
Total C&I
8,483,474  39.1  8,232,719  38.4  
Commercial mortgage:
CRE
5,664,443  26.1  5,418,648  25.3  
Multi-family
4,735,123  21.8  4,876,870  22.7  
ADC
524,714  2.4  467,331  2.2  
Total commercial mortgage10,924,280  50.3  10,762,849  50.2  
Total commercial19,407,754  89.4  18,995,568  88.6  
Residential mortgage2,077,534  9.6  2,210,112  10.3  
Consumer224,669  1.0  234,532  1.1  
Total portfolio loans21,709,957  100.0 %21,440,212  100.0 %
Allowance for credit losses(326,444) (106,238) 
Total portfolio loans, net
$21,383,513  $21,333,974  
Note: the percentages in the table above are rounded to the nearest tenth of a percent.

Overview. Total portfolio loans, net, increased $49,539 to $21,383,513 at March 31, 2020, compared to $21,333,974 at December 31, 2019. This was mainly due to an increase in total commercial loans of $412,186, which was offset by a decline in residential mortgage loans of $132,578, and the change in the ACL of $220,206. This change in total portfolio loans is consistent with our strategy of transitioning our loan portfolio composition to reduce residential mortgage loans and increase the proportion of commercial loans originated through our commercial banking teams.

At March 31, 2020, total C&I loans comprised 39.1% of the total loan portfolio, compared to 38.4% at December 31, 2019. Commercial mortgage loans comprised 50.3% and 50.2% of the total loan portfolio at March 31, 2020 and December 31, 2019, respectively. Residential mortgage loans comprised 9.6% of the total loan portfolio at March 31, 2020, compared to 10.3% at December 31, 2019. Our goal, over time, is for our loan portfolio to consist of 45.0% traditional C&I and commercial finance; 45.0% commercial real estate; and 10.0% consumer and residential mortgage loans.
In the three months ended March 31, 2020, traditional C&I loans increased by $390,761, which occurred mainly in March as clients drew on revolving credit facilities in response to COVID-19. Warehouse lending loans increased $25,393, which was mainly due to the decline in residential mortgage interest rates and an increase in residential mortgage loan refinance activity. Public sector finance loans grew $20,974 and factored receivables grew $1,506. Asset-based lending loans grew $7,526, which includes the loans acquired from Woodforest. These increases were partially offset by declines of $133,041 in equipment finance loans, which included the sale of $95,179 of small balance equipment finance loans and discussed above and repayments and $47,312 in payroll finance loans, which included a combination seasonal fluctuations and the impact of COVID-19 to our clients’ businesses.

CRE loans increased $245,795 in the three months ended March 31, 2020. The increase was mainly due to strong demand for these loan products in our market area. Multi-family loans declined in the first three months of 2020 by $141,747, mainly due to run-off in broker originated loans that are not an on-going part of our multi-family portfolio focus.
62
STERLING BANCORP AND SUBSIDIARIES

ADC loans, which are a component of commercial mortgage loans, increased $57,383 in the three months ended March 31, 2020. This increase is mainly due to construction loans related to our affordable housing tax credit investments. Other ADC loans are generally originated to select clients, mostly within our immediate footprint.

Residential mortgage loans were $2,077,534 at March 31, 2020 compared to $2,210,112 at December 31, 2019, the decline was mainly due to repayments.

Included in our residential mortgage portfolio are loans that were originated in 2010 or earlier as interest-only adjustable rate mortgages (“ARM loans”) with terms of up to forty years, which have an initial fixed rate for five, seven or 10 years and convert into one year interest-only ARM loans at the end of the initial fixed rate period. Interest-only ARM loans require the borrower to pay interest only during the first ten years of the loan term, which typically results in a material increase in the borrower’s monthly payments upon conversion. After the tenth anniversary of the loan, principal and interest payments are required to amortize the loan over the remaining term. There were $787,104 of residential mortgage loans that were originated as interest only ARM loans at March 31, 2020 compared to $846,628 at December 31, 2019.

Non-Performing Loans (“NPLs”) and Non-Performing Assets (“NPAs”)
The table below sets forth the amounts and categories of our NPAs at the dates indicated. There were no warehouse lending, factored receivables or public sector finance loans that were non-performing at such dates.
 March 31,December 31,
 20202019
Non-accrual loans:
Traditional C&I$26,311  $27,148  
Asset-based lending24,873  4,966  
Payroll finance8,684  9,396  
Equipment financing50,473  33,050  
Commercial real estate34,643  26,213  
Multi-family4,448  3,400  
ADC30,434  434  
Residential mortgage60,857  62,275  
Consumer11,482  12,169  
Total non-accrual loans
252,205  179,051  
Accruing loans past due 90 days or more
1,545  110  
Total NPLs253,750  179,161  
OREO11,815  12,189  
Total NPAs$265,565  $191,350  
TDRs accruing and not included above
$36,622  $49,807  
Ratios:
NPLs to total loans1.17 %0.84 %
NPAs to total assets
0.88  0.63  

NPAs and NPLs. NPLs include non-accrual loans and accruing loans past due 90 days or more. NPAs include NPLs and OREO. At March 31, 2020, total NPLs increased $74,589 to $253,750 compared to $179,161 at December 31, 2019. Non-accrual loans were $252,205 and loans 90 days past due and still accruing interest which were well secured and in the process of collection, were $1,545 as of March 31, 2020. Non-accrual loans increased by $73,154 to $252,205 at March 31, 2020 from $179,051 at December 31, 2019. The increase was mainly due to loans in our asset-based lending and equipment financing portfolios, which are in the process of work-out or exit. The increase in ADC was due to one relationship, in which we continue to work with our borrower. The decline in traditional C&I was mainly related to a decline in taxi medallion relationships. Loans past due 90 days or more and still accruing increased $1,435 between the periods. This was mainly due to loans that were in the process of being renewed at their respective period end.

TDRs. TDRs still accruing interest income are loans modified for borrowers that have experienced financial difficulties but are performing in accordance with the terms of their loan and were performing prior to the modification. Loan modification concessions may include actions such as an extension of the maturity date or the lowering of interest rates and monthly payments. At March 31, 2020, total TDRs were $79,112 of which $36,622 were performing in accordance with their modified terms and $42,490 were non-
63
STERLING BANCORP AND SUBSIDIARIES
accrual. At December 31, 2019 total TDRs were $75,656 of which $49,807 were performing and $25,849 were non-accrual. The decrease in performing TDRs at March 31, 2020 was mainly due to transfer to non-accrual of TDRs that were performing at December 31, 2019. Total charge-offs of TDR loans was $805 and $80 for the three months ended March 31, 2020 and 2019, respectively. TDR balances are detailed in the TDR section of Note 4. “Portfolio Loans” in the notes to the consolidated financial statements included elsewhere in this report. As of March 31, 2020, there were no commitments to lend additional funds to borrowers with loans that have been classified as TDRs.

The CARES Act, signed into law on March 27, 2020, permits financial institutions to suspend requirements under GAAP for loan modifications to borrowers affected by COVID-19 that would otherwise be characterized as TDRs and suspend any determination related thereto if (i) the loan modification is made between March 1, 2020 and the earlier of December 31, 2020 or 60 days after the end of the coronavirus emergency declaration and (ii) the applicable loan was not more than 30 days past due as of December 31, 2019 On April 7, 2020, various regulatory agencies, including the Board of Governors of the Federal Reserve System and the Office of the Comptroller of the Currency, (the “Agencies”) issued an interagency statement on loan modifications and reporting for financial institutions working with customers affected by COVID-19. The interagency statement was effective immediately and provided practical expedients for evaluating whether loan modifications that occur in response to COVID-19 are TDRs. The Agencies confirmed with the FASB that short-term modifications made on a good faith basis in response to COVID-19 to borrowers who were current prior to any relief, are not to be considered TDRs. This includes short-term (e.g., six months) modifications such as payment deferrals, fee waivers, extensions of repayment terms, or other delays in payment that are insignificant. Borrowers considered current are those that are less than 30 days past due on their contractual payments at the time a modification program is implemented. We are applying this guidance to qualifying loan modifications.

As of April 22, 2020, we had approved loan modifications on outstanding loan balances of approximately $1.1 billion, or 5.1% of our total loan portfolio. The loan modifications consisted mainly of deferrals of principal or deferrals of principal and interest were generally for a three month period and were not considered TDRs based on the CARES Act and interagency guidance discussed above.

We are participating as a lender under the SBA’s Payroll Protection Program. As of April 22, 2020, we had received over 2,000 client applications for total funding requests of $650 million under the SBA Payroll Protection Program.

OREO. Real estate acquired as a result of foreclosure or by deed in lieu of foreclosure is classified as OREO until such time as it is sold. In addition, financial centers that were closed or consolidated that are held for sale are also classified as OREO. When real estate is transferred to OREO, it is recorded at fair value less costs to sell. If the fair value less cost to sell is less than the loan balance, the difference is charged against the ACL. If the fair value of a financial center that we hold for sale is less than its prior carrying value, we recognize a charge included in other operating expense to reduce the recorded value of the investment to fair value, less costs to sell. After transfer to OREO, we regularly update the fair value of the properties. Subsequent declines in fair value are charged to current earnings and included in other non-interest expense as part of OREO expense. At March 31, 2020, we had OREO properties with a recorded balance of $11,815, compared to $12,189 at December 31, 2019. The decrease was mainly due to $1,091 in sales. We had OREO additions of $732 in the three months ended March 31, 2020.

Classification of Assets. Our determination as to the classification of our assets and the amount of our ACL are subject to review by our regulators, who can direct the charge-off of loans and order the establishment of additions to our ACL. Management regularly reviews our asset portfolio to determine whether any assets require classification in accordance with applicable regulations. As of March 31, 2020, we had $132,356 of loans designated as “special mention” compared to $159,976 at December 31, 2019. The decrease was mainly due to asset-based lending loans and small balance equipment finance loans which were classified substandard in the period.

On the basis of management’s review of our assets at March 31, 2020, classified assets consisted of substandard loans of $402,393 and OREO of $11,815. Substandard loans were $295,428 and OREO was $12,189 at December 31, 2019. The increase in substandard loans in the three months ended March 31, 2020 was mainly related to two asset-based lending loan relationships, one ADC relationship, and small balance equipment finance loans.

ACL - Loans. The ACL - loans is a valuation account that is deducted from the amortized cost basis of portfolio loans to present the net amount expected to be collected on portfolio loans over their contractual life. See Note 1. “Basis of Financial Statement Presentation - (e) Accounting Principle Change” for additional detail regarding our ACL - loan calculation methodology.

Our estimate of credit losses at March 31, 2020 is based on the Moody’s baseline forecast scenario as of April 11, 2020, which included the impact of recent COVID-19 developments. The Moody’s baseline forecast incorporates a significant amount of macroeconomic assumptions and variables.

64
STERLING BANCORP AND SUBSIDIARIES
To address potential model uncertainties, this we overlay qualitative factors to the quantitative results of loss estimates calculated under the assumptions above. The qualitative adjustments include the following:
•Lending policies and procedures including changes in lending strategies, underwriting standards, collection, write-off and recovery practices;
•Experience, ability and depth of management and lending and other relevant staff;
•Nature and volume of our loans and changes therein;
•Changes and expected changes in general market conditions of either the geographical area or industry related to our exposure;
•An adjustment for economic conditions during reasonable and supportable period; and
•An adjustment for additional factors including data quality and changes in the number of assumptions used in quantitative models.

The ACL - loans increased from $106,238 at December 31, 2019 to $326,444 at March 31, 2020. The ACL - loans at March 31, 2020 represented 128.6% of non-performing loans and 1.50% of total portfolio loans. At December 31, 2019, the allowance for loan losses represented 59.3% of non-performing loans and 0.50% of total portfolio loans.

Allocation of ACL. The following table sets forth the ACL allocated by loan category, the total loan balances by category (excluding loans held for sale), and the percent of loans in each category to total loans at the dates indicated. The allowance for loan losses allocated to each category is not necessarily indicative of future losses in any particular category and does not restrict the use of the allowance to absorb losses in other categories.
 March 31, 2020December 31, 2019
 Allowance
for credit losses		Loan
balance		% of ACL to loan balanceAllowance
for loan
losses		Loan
balance		% of ALLL to loan balance
Traditional C&I$35,289  $2,745,792  1.30 %$15,951  $2,355,031  0.70 %
Asset-based lending26,490  1,075,092  2.50  14,272  1,082,618  1.30  
Payroll finance3,730  179,554  2.10  2,064  226,866  0.90  
Warehouse lending289  1,356,277  —  917  1,330,884  0.10  
Factored receivables9,194  225,144  4.10  654  223,638  0.30  
Equipment financing60,028  1,667,523  3.60  16,723  1,800,564  0.90  
Public sector finance1,929  1,234,092  0.20  1,967  1,213,118  0.20  
CRE97,586  5,664,443  1.70  27,965  5,418,648  0.50  
Multi-family49,097  4,735,123  1.00  11,440  4,876,870  0.20  
ADC
15,204  524,714  2.90  4,732  467,331  1.00  
Residential mortgage23,090  2,077,534  1.10  7,598  2,210,112  0.30  
Consumer4,518  224,669  2.00  1,955  234,532  0.80  
Total$326,444  $21,709,957  1.50 %$106,238  $21,440,212  0.50 %

Collateral Dependent Loans. A loan must meet both of the following conditions to be considered collateral dependent:
• We expect repayment of the financial asset to be provided substantially through the operation or sale of the collateral.
• We determined the borrower is experiencing financial difficulty as of the financial statement date.

Generally loans are identified as collateral dependent when the loan is in foreclosure, is a TDR or is a loan that was were measured for impairment at December 31, 2019 (see below). For collateral dependent loans we measure the expected credit losses based on the difference between the fair value of the collateral and the amortized cost basis. If the loan is in foreclosure, or we determine foreclosure is probable, we reduce the fair value of the collateral by costs to sell the asset. If we expect repayment from the operation of the asset, we do not reduce for the cost to sell.

Collateral dependent loans were $200,948 at March 31, 2020. The increase in collateral dependent loans compared to impaired loans at December 31, 2019, was mainly due to one ADC relationship, two asset-based lending relationships and the adoption of the CECL Standard, which impacted the classification of collateral dependent equipment finance and residential mortgage loans. Prior to 2020, equipment finance and residential mortgage loans were measured for impairment only if the loan balance exceeded $750. As our CECL methodology allows us to determine fair value and expected credit losses for each loan individually, we now consider loans collateral dependent based on the criteria discussed above.

65
STERLING BANCORP AND SUBSIDIARIES
Impaired Loans. Before we implemented the CECL Standard, a loan was impaired when it was probable we will be unable to collect all amounts due according to the contractual terms of the loan agreement. Impaired loan values were based on one of three measures: (i) the present value of expected future cash flows discounted at the loan’s effective interest rate; (ii) the loan’s observable market price; or (iii) the fair value of the collateral if the loan is collateral dependent. If the measure of an impaired loan was less than its recorded investment, our practice was to write-down the loan against the allowance for loan losses so the recorded investment matched the impaired value of the loan. Impaired loans generally included a portion of non-performing loans and accruing and performing TDR loans. At December 31, 2019, we held impaired loans of $109,025.

Purchase Credit Deteriorated (PCD) Loans. As part of our adoption of the CECL standard, loans that were classified as PCI and accounted for under ASC 310-30 were designated PCD loans. We did not reassess whether PCI loans met the criteria of PCD loans as of the date of adoption and determined all PCI loans were PCD loans. The amortized cost basis of PCI loans at adoption was $116,274 at December 31, 2019. The balance increased to $129,965 due to the increase to the balance of PCD loans of $22,496, which represented the credit portion of the remaining purchase accounting adjustment for PCD loans at January 1, 2020.

Changes in Financial Condition between March 31, 2020 and December 31, 2019
Total assets decreased $251,461 to $30,335,036 at March 31, 2020, compared to $30,586,497 at December 31, 2019. Components of the change in total assets were:
•Commercial loans increased by $412,186 to $19,407,754 at March 31, 2020, compared to $18,995,568 at December 31, 2019.
•Residential mortgage loans held in our loan portfolio declined by $132,578 to $2,077,534 at March 31, 2020 compared to $2,210,112 at December 31, 2019. This decline was mainly due to repayments.
•Total investment securities declined by $458,297 to $4,617,012 at March 31, 2020, compared to $5,075,309 at December 31, 2019, mainly due to sales and calls of securities.
•Other assets increased by $149,924 to $990,792 at March 31, 2020, compared to $840,868 at December 31, 2019. The components of other assets are as follows:
March 31,December 31,
20202019
Low income housing tax credit investments$402,317  $386,824  
Right of use asset for operating leases 107,711  112,226  
Fair value of swaps (see Note 9)166,432  67,318  
Cash on deposit as swap collateral net of settlement94,092  93,606  
Operating leases - equipment and vehicles leased to others67,701  72,291  
Other asset balances152,539  108,603  
$990,792  $840,868  
The table above includes the following items:
•We have invested in various limited partnerships that sponsor affordable housing projects utilizing low income housing tax credits. These investments assist us in achieving our goals associated with the Community Reinvestment Act.
•The right of use assets for operating leases represents the asset recognized under the lease accounting standard which requires all operating leases to be recorded in the consolidated balance sheets, which are discussed in Note 15. “Leases” in the notes to consolidated financial statements included elsewhere in this report.
•Fair value of swaps reflects the change in value since date of inception of our back-to-back commercial client loan swap program and positions, which are discussed in Note 9. “Derivatives” in the notes to consolidated financial statements included elsewhere in this report.
•Cash on deposit as swap collateral net of settlement represents amounts on deposit with third parties net of settlement to market for exchange traded and over the counter swaps.
•Other asset balances include income tax balances, prepaid insurance, prepaid property taxes, prepaid maintenance, other accounts receivable and miscellaneous assets.

Total liabilities decreased $143,772 to $25,912,612 at March 31, 2020, compared to $26,056,384 at December 31, 2019. The decrease was mainly due to the following:
•FHLB borrowings decreased $290,202 to $1,955,451 at March 31, 2020, compared to $2,245,653 at December 31, 2019, which was mainly the result of an increase in deposits and sale of investment securities. Proceeds were used to and pay down borrowings.
66
STERLING BANCORP AND SUBSIDIARIES
•Other liabilities declined $34,309 to $659,143 at March 31, 2020, compared to $693,452 at December 31, 2019. The decrease was mainly due to funding of accrued affordable housing commitments and payout of amounts accrued for 2019 compensation.
•Brokered deposits declined $14,851 to $1,851,593 at March 31, 2020, compared to $1,866,444 at December 31, 2019. The decrease was a change in funding mix as a result of other deposit inflows.
The decreases above, were partially offset by the following increases:
•Total deposits increased $139,622 to $22,558,280 at March 31, 2020, compared to $22,418,658 at December 31, 2019. Our core deposits were $20,704,023 at March 31, 2020, which represented 91.8% of our total deposit balances.
•Municipal deposits increased $103,212 to $2,091,259 at March 31, 2020, compared to $1,988,047 at December 31, 2019. The increase was mainly due to property tax collections in January 2020.

Supplemental Reporting of Non-GAAP Financial Measures
The non-GAAP financial measures presented below are used by our management and our Board of Directors on a regular basis in addition to our GAAP results to facilitate the assessment of our financial performance and to assess our performance compared to our annual budget and strategic plans. These non-GAAP financial measures complement our GAAP reporting and are presented below to provide investors, analysts, regulators and others information that we use to manage and evaluate our performance each period. This information supplements our GAAP reported results, and should not be viewed in isolation from, or as a substitute for, our GAAP results. Accordingly, this financial information should be read in conjunction with our consolidated financial statements, and notes thereto for the quarter ended March 31, 2020, included elsewhere in this report, and the year ended December 31, 2019, included in the 2019 Form 10-K.



March 31,
20202019
The following table shows the reconciliation of pretax pre-provision net revenue to adjusted pretax pre-provision net revenue:
Net interest income$211,772  $235,506  
Non-interest income47,326  19,597  
Total net interest income and non-interest income259,098  255,103  
Non-interest expense114,713  114,992  
Pretax pre-provision net revenue144,385  140,111  
Adjustments:
Accretion income(10,686) (25,580) 
Net loss (gain) on sale of securities(8,412) 13,184  
Net (gain) loss on termination of Astoria defined benefit pension plan—  —  
Net (gain) on sale of residential mortgage loans—  (8,313) 
(Gain) loss on extinguishment of debt744  (46) 
Impairment related to financial centers and real estate consolidation strategy—  —  
Charge for asset write-downs, systems integration, retention and severance—  3,344  
Amortization of non-compete agreements and acquired customer list intangible assets172  242  
Adjusted pretax pre-provision net revenue$126,203  $122,942  


67
STERLING BANCORP AND SUBSIDIARIES
March 31,
20202019
The following table shows the reconciliation of stockholders’ equity to tangible common equity and the tangible common equity ratio 1:
Total assets$30,335,036  $29,956,607  
Goodwill and other intangibles(1,789,646) (1,782,533) 
Tangible assets28,545,390  28,174,074  
Stockholders’ equity4,422,424  4,419,223  
Preferred stock(137,363) (138,218) 
Goodwill and other intangibles(1,789,646) (1,782,533) 
Tangible common stockholders’ equity2,495,415  2,498,472  
Common stock outstanding at period end194,460,656  209,560,824  
Common stockholders’ equity as a % of total assets14.13 %14.29 %
Book value per common share$22.04  $20.43  
Tangible common equity as a % of tangible assets8.74 %8.87 %
Tangible book value per common share$12.83  $11.92  

For the three months ended
March 31,
20202019
The following table shows the reconciliation of reported return on average tangible assets and adjusted return on average tangible assets 2:
Average assets$30,484,433  $30,742,943  
Average goodwill and other intangibles(1,792,400) (1,756,506) 
Average tangible assets28,692,033  28,986,437  
Net income available to common stockholders12,171  99,448  
Net income, if annualized48,951  403,317  
Reported return on average tangible assets0.17 %1.39 %
Adjusted net (loss) income (non-GAAP)$(3,124) $105,902  
Annualized adjusted net (loss) income(12,565) 429,492  
Adjusted return on average tangible assets (non-GAAP)(0.04)%1.48 %
_______________
See legend beginning on page 70.

68
STERLING BANCORP AND SUBSIDIARIES
For the three months ended
March 31,
20202019
The following table shows the reconciliation of reported net income and reported EPS (GAAP) to adjusted net income available to common stockholders (non-GAAP) and adjusted diluted EPS (non-GAAP)3:
Income before income tax expense$6,105  $129,911  
Income tax (benefit) expense(8,042) 28,474  
Net income (GAAP)14,147  101,437  
Adjustments:
Net (gain) loss on sale of securities(8,412) 13,184  
Net (gain) on sale of residential mortgage loans
—  (8,313) 
Charge for asset write-downs, retention and severance
—  3,344  
Net loss (gain) on extinguishment of borrowings744  (46) 
Amortization of non-compete agreements and acquired customer lists
172  242  
Total pre-tax adjustments(7,496) 8,411  
Adjusted pre-tax (loss) income(1,391) 138,322  
Adjusted income tax (benefit) expense(243) 30,431  
Adjusted net (loss) income (non-GAAP)(1,148) 107,891  
Preferred stock dividend1,976  1,989  
Adjusted net (loss) income available to common stockholders (non-GAAP)
$(3,124) $105,902  
Weighted average diluted shares
196,709,038  213,505,842  
Diluted EPS as reported (GAAP)$0.06  $0.47  
Adjusted diluted EPS (non-GAAP)
(0.02) 0.50  

For the three months ended
March 31,
20202019
The following table shows the reconciliation of reported return on average tangible common stockholders’ equity and adjusted return on average tangible common stockholders’ equity 4:
Average stockholders’ equity$4,506,537  $4,415,449  
Average preferred stock(137,579) (138,348) 
Average goodwill and other intangibles(1,792,400) (1,756,506) 
Average tangible common stockholders’ equity2,576,558  2,520,595  
Net income available to common stockholders12,171  99,448  
Net income, if annualized48,951  403,317  
Reported return on average tangible common stockholders’ equity1.90 %16.00 %
Adjusted net (loss) income (non-GAAP)$(3,124) $105,902  
Annualized adjusted net (loss) income(12,565) 429,492  
Adjusted return on average tangible common stockholders’ equity (non-GAAP)
(0.49)%17.04 %
See legend beginning on page 70.

69
STERLING BANCORP AND SUBSIDIARIES
For the three months ended
March 31,
20202019
The following table shows the reconciliation of the reported operating efficiency ratio and adjusted operating efficiency ratio 5:
Net interest income$211,772  $235,506  
Non-interest income47,326  19,597  
Total revenue259,098  255,103  
Tax equivalent adjustment on securities
3,454  3,949  
Loss on termination of pension plan—  280  
Net (gain) loss on sale of securities(8,412) 13,184  
Net (gain) on sale of residential mortgage loans—  (8,313) 
Depreciation of operating leases(3,492) —  
Adjusted total revenue (non-GAAP)250,648  264,203  
Non-interest expense114,713  114,992  
Charge for asset write-downs, systems integration, retention and severance
—  (3,344) 
Net (loss) gain on extinguishment of borrowings(744) 46  
Depreciation of operating leases(3,492) —  
Amortization of intangible assets(4,200) (4,826) 
Adjusted non-interest expense (non-GAAP)$106,277  $106,868  
Reported operating efficiency ratio (non-GAAP)44.3 %45.1 %
Adjusted operating efficiency ratio (non-GAAP)42.4  40.4  
_______________
See legend beginning below.


1 Common stockholders’ equity as a percentage of total assets, book value per common share, tangible common equity as a percentage of tangible assets and tangible book value per common share are non-GAAP measures that provide information to help assess our capital position and financial strength. We believe tangible book value measures improve comparability to other banking organizations that have not engaged in acquisitions that have resulted in the accumulation of goodwill and other intangible assets.

2 Reported return on average tangible assets and adjusted return on average tangible assets are non-GAAP measures that provide information to help assess our profitability.

3 Adjusted net income available to common stockholders and adjusted EPS are non-GAAP measures that present a summary of our earnings, which includes adjustments to exclude certain revenues and expenses (generally associated with discrete merger transactions and non-recurring strategic plans) to help in assessing our recurring profitability. For the purpose of calculating adjusted net income available for common stockholders and adjusted EPS, income tax expense is calculated using the estimated effective income tax rate for the full year in effect for the particular period end, as we believe this is a more accurate presentation of run rate income tax expense and earnings.

4 Reported return on average tangible common stockholders’ equity and the adjusted return on average tangible common stockholders’ equity are non-GAAP measures that provide information to evaluate the use of our tangible common equity.

5 The reported operating efficiency ratio is a non-GAAP measure calculated by dividing our GAAP non-interest expense by the sum of our GAAP net interest income plus GAAP non-interest income. The adjusted operating efficiency ratio is a non-GAAP measure calculated by dividing non-interest expense adjusted for intangible asset amortization and certain expenses generally associated with discrete merger transactions and non-recurring strategic plans by the sum of net interest income plus non-interest income plus the tax equivalent adjustment on securities income and elimination of the impact of gain or loss on sale of securities. The adjusted operating efficiency ratio is a measure we use to assess our operating performance.



70
STERLING BANCORP AND SUBSIDIARIES
Liquidity and Capital Resources
Capital. Stockholders’ equity was $4,422,424 as of March 31, 2020, a decrease of $107,689 relative to December 31, 2019. The decrease was due to the repurchase of 4,900,759 common shares at a cost of $81,032, the adoption of the CECL Standard, which reduced capital by $54,254 and declared dividends of $13,768 on common stock and $2,194 on preferred stock. These decreases were partially offset by net income of $14,147, an increase in accumulated other comprehensive gain of $27,405, which was primarily due to an increase in the fair value of our AFS portfolio, and an increase of stock option exercises and stock-based compensation of $414.

We paid dividends of $0.07 per common share in each quarter of 2019 and the first quarter of 2020. Most recently, our Board of Directors declared a dividend of $0.07 per common share on April 27, 2020, which is payable May 22, 2020 to our holders as of the record date of May 8, 2020. We paid dividends of $16.25 per preferred share in each quarter of 2019 and the first quarter of 2020. In addition, on April 15, 2020, we paid a dividend of $16.25 per preferred share.

Basel III Capital Rules. The Basel III Capital Rules were fully phased in on January 1, 2019. The rules are discussed in Note 14. “Stockholders’ Equity - Regulatory Capital Requirements” in the notes to consolidated financial statements included elsewhere in this report.

Liquidity. As discussed in our 2019 Form 10-K, our liquidity position is continuously monitored and we make adjustments to the balance between sources and uses of funds as deemed appropriate. Liquidity risk management is an important element in our asset / liability management process. We regularly model liquidity stress scenarios to assess potential liquidity outflows or funding problems resulting from economic activity, volatility in the financial markets, unexpected credit events or other significant occurrences. These scenarios are incorporated into our contingency funding plan, which provides the basis for the identification of our liquidity needs. As of March 31, 2020, our management is not aware of any events that are reasonably likely to have a material adverse effect on our liquidity, capital resources or operations. In addition, management is not aware of any regulatory recommendations regarding liquidity, including the Basel III liquidity framework, which, if implemented, would have a material adverse effect on us.

At March 31, 2020, the Bank had $348,636 in cash and cash equivalents on hand and unused borrowing capacity at the FHLB of $5,593,328. In addition, the Bank may purchase federal funds from other institutions and enter into additional repurchase agreements. The Bank had $2,317,396 of unencumbered securities available to pledge as collateral as of March 31, 2020. On March 15, 2020, the Federal Reserve Board reduced reserve requirements ratios to zero effective March 26, 2020, which eliminated our reserve requirement as of March 31, 2020. Prior to that time, we maintained deposits at the Federal Reserve Bank of New York in compliance with our reserve requirements.

We are a bank holding company and do not conduct operations. Our primary sources of liquidity are dividends received from the Bank and borrowings from outside sources. Banking regulations may limit the amount of dividends that may be paid by the Bank. At March 31, 2020, the Bank had capacity to pay approximately $48,325 of dividends to us under regulatory guidelines without prior regulatory approval.

We had cash on hand of $256,563 at March 31, 2020. We received dividends from the Bank of $95,000 in the quarter ended March 31, 2020. In the first three months of 2019, we used $81,032 for common stock repurchases, $15,962 for dividends and $2,000 to repurchase a portion of our outstanding Senior Notes that we assumed in the Astoria Merger.

Effective August 27, 2019 we renewed our $35,000 credit facility with a financial institution, which is more fully described in Note 8. “Borrowings” in the notes to consolidated financial statements included elsewhere in this report. The use of proceeds are for general corporate purposes. The credit facility has no outstanding balance and requires us and the Bank to maintain certain ratios related to capital, non-performing assets to capital, reserves to non-performing loans and debt service coverage. We and the Bank were in compliance with all requirements at March 31, 2020.

In connection with the Astoria Merger, we assumed $200,000 principal amount of the Senior Notes which mature on June 8, 2020. At March 31, 2020, the balance outstanding was $171,422. We expect to use cash on hand to payoff the Senior Notes at maturity.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

Management believes that our most significant form of market risk is interest rate risk. The general objective of our interest rate risk management is to determine the appropriate level of risk given our business strategy, and then manage that risk in a manner that is consistent with our policy to limit the exposure of our net interest income to changes in market interest rates. The Bank’s Asset/Liability Management Committee (“ALCO”), which consists of certain members of senior management, evaluates the interest rate risk inherent in certain assets and liabilities, our operating environment, and capital and liquidity requirements, and modifies our lending, investing and
71
STERLING BANCORP AND SUBSIDIARIES
deposit gathering strategies accordingly. A committee of our Board of Directors reviews ALCO’s activities and strategies, the effect of those strategies on our net interest margin, and the effect that changes in market interest rates would have on the economic value of our loan and securities portfolios, as well as the intrinsic value of our deposits and borrowings.

Management actively evaluates interest rate risk in connection with our lending, investing, and deposit activities. Management emphasizes the origination of CRE loans and C&I loans. We also invest in shorter-term securities, which generally have lower yields compared to longer-term investments. Shortening the average maturity of our interest earning assets by increasing our investments in shorter-term loans and securities may help us to better match the maturities and interest rates of our assets and liabilities, thereby reducing the exposure of our net interest income to changes in market interest rates. These strategies may adversely affect net interest income due to lower initial yields on these investments in comparison to longer-term, fixed-rate loans and investments.

Management monitors interest rate sensitivity primarily through the use of a model that simulates net interest income (“NII”) under varying interest rate assumptions. Management also evaluates this sensitivity using a model that estimates the change in our and the Bank’s economic value of equity (“EVE”) over a range of interest rate scenarios. EVE is the present value of expected cash flows from assets, liabilities and off-balance sheet contracts. The model assumes estimated loan prepayment rates, reinvestment rates and deposit decay rates that management believes is reasonable, based on historical experience during prior interest rate changes.

Estimated Changes in EVE and NII. The table below sets forth, as of March 31, 2020, the estimated changes in our (i) EVE that would result from the designated instantaneous changes in the forward rate curves; and (ii) NII that would result from the designated instantaneous changes in the U.S. Treasury yield curve. Computations of prospective effects of hypothetical interest rate changes are based on numerous assumptions including relative levels of market interest rates, loan prepayments and deposit decay, and should not be relied on as indicative of actual results.

Interest ratesEstimatedEstimated change in EVEEstimatedEstimated change in NII
(basis points)EVEAmountPercentNIIAmountPercent
 (Dollars in thousands)
+300$3,962,862  $289,279  7.9 %$1,037,208  $156,935  17.8 %
+2003,978,541  304,958  8.3  986,337  106,064  12.0  
+1003,891,743  218,160  5.9  933,755  53,482  6.1  
03,673,583  —  —  880,273  —  —  
-1003,080,869  (592,714) (16.1) 821,618  (58,655) (6.7) 
-2002,560,041  (1,113,542) (30.3) 792,254  (88,019) (10.0) 
Certain shortcomings are inherent in the methodology used in the above interest rate risk measurements. Modeling changes in EVE and NII require making certain assumptions that may or may not reflect the manner in which actual yields and costs respond to changes in market interest rates. The EVE and NII table presented above assumes that the composition of our interest-rate sensitive assets and liabilities existing at the beginning of a period remains constant over the period being measured and, accordingly, the data does not reflect any actions management may undertake in response to changes in interest rates. The table also assumes that a particular change in interest rates is reflected uniformly across the yield curve regardless of the duration to maturity or the re-pricing characteristics of specific assets and liabilities. Accordingly, although the EVE and NII table provides an indication of our sensitivity to interest rate changes at a particular point in time, such measurements are not intended to and do not provide a precise forecast of the effect of changes that market interest rates may have on our net interest income. Actual results will likely differ.

During the three months ended March 31, 2020, the federal funds target rate was lowered from 1.50 - 1.75% to 0.00 - 0.25% in an effort to mitigate the effects of COVID-19 on economic activity. U.S. Treasury yields with two year maturities decreased 135 basis points from 1.58% to 0.23% over the three months ended March 31, 2020, while the yield on U.S. Treasury 10-year notes decreased 122 basis points from 1.92% to 0.70%. The greater decrease in interest rates on short-term maturities relative to the lesser decrease in interest rates on longer-terms maturities resulted in a steeper 2-10 year U.S. Treasury yield curve at March 31, 2020 compared to December 31, 2019.  At its March 2020 meeting, the Federal Open Markets Committee (the “FOMC”) stated that it expects to maintain the federal funds target rate until it is confident that the economy has weathered recent events and is on-track to achieve its maximum employment and price stability goals. The Fed further stated that the recent reductions in the federal funds target rate will help support economic activity, strong labor market conditions, and inflation returning to the Committee’s objective.

Item 4. Controls and Procedures

72
STERLING BANCORP AND SUBSIDIARIES
The Company’s management, including the principal executive officer and principal financial officer, evaluated the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended) as of the end of the period covered by this report.  Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective for the purpose of ensuring that the information required to be disclosed in our reports filed with the SEC under the Securities Exchange Act of 1934, as amended, is: (i) recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms; and (ii) accumulated and communicated to our management, including the Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

Changes in Internal Controls 
The adoption of the CECL Standard did result in new policies and procedures regarding, and introduced new controls over, the review of economic forecasting projections obtained from Moody’s. However, the internal controls for CECL are substantially similar to the internal controls used under GAAP prior to adoption of the CECL Standard for the allowance for loan losses. As a result, we concluded there were no changes in the Company’s internal controls over financial reporting during the three months ended March 31, 2020 that have materially affected, or are reasonably likely to materially affect, the Company’s internal controls over financial reporting.

PART II
Item 1. Legal Proceedings

The “Litigation” section of Note 15. “Commitments and Contingencies” in the notes to consolidated financial statements included in Part I, Item 1 is incorporated herein by reference.

Item 1A. Risk Factors
For information regarding factors that could affect our business, results of operations, financial condition and liquidity, see the risk factors discussed under Part I, Item 1A of our 2019 Form 10-K.

The risk factors set forth in our 2019 Form 10-K are updated by adding the following risk factor:

The COVID-19 pandemic has impacted our business, and the ultimate impact on our business, financial position, results of operations and/or cash flows will depend on future developments, which are highly uncertain and cannot be predicted, including, but not limited to, the scope and duration of the pandemic and the actions taken by governmental authorities, our clients and our business partners in response to the pandemic.

The global pandemic resulting from the outbreak of COVID-19 has negatively impacted the global economy, disrupted global supply chains, lowered equity market valuations, created significant volatility and disruption in financial markets, and increased unemployment levels. In addition, the pandemic has resulted in temporary closures of many businesses and the institution of social distancing and sheltering in place requirements in many states and communities. Some of the risks we face from the pandemic include, but are not limited to: the health and availability of our colleagues, the financial condition of our clients and the demand for our products and services, falling interest rates, recognition of credit losses and increases in the allowance for credit losses, especially if businesses remain closed, unemployment continues to rise and clients and customers draw on their lines of credit or seek additional loans to help finance their businesses, and a significant deterioration of business conditions in our markets, particularly the New York Metro market and the New York Suburban market.

While we have not experienced a significant impact on the availability of our employees to date, given the markets we operate in, our colleagues are at a greater risk of being exposed to COVID-19. While we have taken meaningful steps and precautions to ensure their health and well-being, COVID-19 could still impact our colleagues’ ability to work effectively and availability due to illness, quarantines, government actions, financial center closures or other reasons. In particular, our financial centers present an increased risk of exposure for our employees. If our employees are not able to work as effectively or a substantial number of employees are unable to work due to COVID-19, our business would be adversely effected.

Our clients are subject to many of the factors described above. Such events could affect the stability of our deposit base, impair the ability of borrowers to repay outstanding loans, impair the value of collateral securing loans, cause significant property damage, and result in loss of revenue. It is possible that the spread of COVID-19 may also cause delays in the willingness or ability of clients to perform, including, but not limited to, making timely payments to us, and other unpredictable events.

The pandemic has also influenced the recognition of credit losses in our loan portfolios and increased our allowance for credit losses. During the quarter ended March 31, 2020, approximately $120,000 of the $138,280 provision for credit losses recorded was a result of
73
Table of Contents



changing our forecast and model assumptions due to COVID-19. Post March 31, 2020, we have also entered into a significant number of forbearance agreements with clients. The pandemic could continue to have a material adverse effect on our loan portfolio, particularly as businesses remain closed and as more clients may need to draw on their lines of credit or seek additional loans to help finance their businesses. Similarly, because of changing economic and market conditions affecting issuers, we may be required to recognize other-than-temporary impairments in future periods on the securities we hold, as well as reductions in other comprehensive income.

The New York Metro Market and the New York Suburban Market have been disproportionately impacted by COVID-19 relative to other areas. As such, the impact on COVID-19 on us and our clients may be greater than on similar banks or bank holding companies that do not have a similar geographic concentration.

The volatility in the global capital markets resulting from the pandemic and related business conditions may restrict our access to capital and/or increase our cost of capital.

To the extent the COVID-19 pandemic adversely affects our business, financial position, results of operations and/or cash flows, it may also have the effect of heightening many of the other risks we face, including the risks described in the section entitled “Risk Factors” in our 2019 Form 10-K and any subsequent Quarterly Report on Form 10-Q.

We continue to work with our stakeholders (including colleagues, clients, and business partners) to assess, address and mitigate the impact of this global pandemic. However, we cannot predict the length and impact of the COVID-19 pandemic at this time.

The risks described in our 2019 Form 10-K are not the only risks that we encounter. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, results of operations, financial condition and/or liquidity.

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

Issuer Purchases of Equity Securities
The following table reports information regarding purchases of our common stock during the first quarter of 2020 and the stock repurchase plan approved by the Board:  

Total Number
of shares
(or units)
purchased 		Average
price paid
per share
(or unit)
Total number of
shares (or units)
purchased as part
of publicly
announced plans
or programs (1)
Maximum number
(or approximate
dollar value) of
shares (or units)
that may yet be
purchased under the
plans or programs (1)
Period (2020)
January 1 — January 31935,033  $20.34  935,033  10,637,502  
February 1 — February 29933,708  19.13  933,708  9,703,794  
March 1 — March 313,032,018  14.56  3,032,018  6,671,776  
Total4,900,759  16.53  4,900,759  

(1) Repurchases may be made at management’s discretion through open market purchases and block trades in accordance with SEC and regulatory requirements. Any shares repurchased will be held as Treasury stock and made available for general corporate purposes.

Item 3. Defaults Upon Senior Securities

Not Applicable.

Item 4. Mine Safety Disclosure

Not Applicable.

Item 5. Other Information

Not Applicable.
74
Table of Contents



Item 6. Exhibits
Exhibit NumberDescription
3.1
3.2
4.1
4.2
4.3
4.4
4.5
4.6
31.1
31.2
32.0
101.INSXBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
101.SCHXBRL Taxonomy Extension schema Document
101.CALXBRL Taxonomy Extension Calculation Linkbase Document
101.LABXBRL Taxonomy Extension Calculation Linkbase Document
101.PREXBRL Taxonomy Extension Presentation Linkbase Document
101.DEFXBRL Taxonomy Extension Definition Linkbase Document

The Company agrees to furnish to the SEC, upon request, any instrument with respect to long-term debt that the Company has not filed as an exhibit pursuant to the exemption provided by Item 601(b)(4)(iii)(A) of Regulation S-K.
75
Table of Contents




SIGNATURES

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

Sterling Bancorp
Date:May 4, 2020By:/s/ Jack Kopnisky
Jack Kopnisky
President, Chief Executive Officer and Director
(Principal Executive Officer)
Date:May 4, 2020By:/s/ Luis Massiani
Luis Massiani
Senior Executive Vice President and Chief Financial Officer
(Principal Financial Officer and Principal Accounting Officer)


76