HCBK

December 16, 2011 | 9 Pages



Banks & Thrifts Company Report



Hudson City Bancorp, Inc.

(NNM: HCBK)

RESTRUCTURING 2.0 COMES AHEAD OF SCHEDULE BUT RATING: NEUTRAL

SMALLER THAN EXPECTED - LOW RATE ENVIRONMENT Matthew Kelley Mike I. Shafir

WILL CONTINUE TO WEIGH ON EARNINGS; ADJUSTING (207) 699-5800 (212) 763-8239

mkelley@sterneagee.com mshafir@sterneagee.com

ESTIMATES

Matthew Breese

2nd Restructuring Announced. Before the open today, Hudson (207) 699-5800

City announced their second balance sheet restructuring plan in mbreese@sterneagee.com

2011. In the transaction today, the company extinguished $4.3

bil. of higher cost (4.21%) borrowings at a pre-tax cost of $729 Fiscal Year Ends Dec

mil. or a 17% pre-tax charge. The first restructuring in March

had a 9.4% pre-tax charge on the extinguishment of borrowings. Rating: Neutral

This restructuring was smaller than the $10 - $15 bil. Price: Close $5.78

extinguishment/restructuring we envisioned and outlined in our Price Target: --

October 26th note. 52-wk Range: $5.09-$13.26

Market Capitalization (M): $3,049

Why Now? We had been of the view that the company would

Shares Outstanding (M): 527.5

attempt to shrink organically into early next year, build capital

Assets (M): $45,076

and then execute a larger restructuring in conjunction with an

asset sale (loans and securities) to offset the charges. In our view, Avg. Daily Vol. (000): 0

the asset sale part of equation may have become unfeasible due to Dividend: $0.32

the secondary market pricing pressures for a jumbo prime loan Dividend Yield: 5.5%

sale. With cash and liquidity building at a more rapid rate than Tangible Book Value: $8.89

expected (a separate concern noted below), we believe the Price/Tangible Book Value: 65%

company chose to execute a smaller transaction today to continue

working down this challenge.

Earnings Summary

Earnings and Capital Impact – 4Q Core EPS Lowered on NIM. FYE Dec 2011E 2012E 2013E

We increased our full year 2012 and 2013 earnings estimates by

7% to $0.62 for each year. Tangible book value (ex unallocated EPS & P/E Summary

2011 2012 2013

ESOP shares) is expected to decline by 9% to $8.89 per share. EPS: 2011E Prior 2012E Prior 2013E Prior

Pro forma capital at the bank (tier 1 leverage) and holding Q1 -$1.13 -$1.13 $0.16 $0.15 $0.16 $0.14

company (TCE/TA) will remain essentially flat compared to Q2 $0.19 $0.19 $0.15 $0.14 $0.15 $0.14

current levels of 8.7% and 9.8%. We lowered our 4Q operating Q3 $0.17 $0.17 $0.16 $0.15 $0.16 $0.15

estimate by a penny to $0.14 per share (from $0.15) to reflect Q4 -$0.75 $0.15 $0.15 $0.14 $0.15 $0.15

elevated prepayment activity in the quarter. Our full year 2011 Full Year -$1.51 -$0.61 $0.62 $0.58 $0.62 $0.58

estimate was reduced to -$1.51 to reflect the charge and lower 4Q P/E Ratio: -3.8 -- 9.3 -- 9.3 --

core EPS estimate.

Valuations and Options. In our view, the shares should continue

to trade at roughly 10x earnings and a discount to TBV to reflect

the ongoing risk to earnings in a sustained low rate environment.

In a sustained low interest rate environment, we expect asset

yield compression will continue and result in further margin

pressures following the first quarter 2012 improvement as a result

of this debt extinguishment. Given the company’s size, regulatory

challenges and an already high dividend payout ratio of 52%, we

do not believe the company will be an active buyer of their own

shares anytime soon despite the attractive valuation. In our view,

given the size and elevated interest rate risk of the company’s

business model, regulators will require meaningfully higher

levels of capital for the company in the years ahead.

Source: Factset



Important Disclosures regarding Price Target Risks, Valuation Methodology, Regulation Analyst Certification,

Investment Banking, Ratings Definitions, and potential conflicts of interest begin on Page I of the Appendix Section.

800 Shades Creek Parkway Suite 700 Birmingham, AL 35209 205-949-3500

Sterne, Agee & Leach Inc. is Member NYSE, FINRA, SIPC

HUDSON CITY BANCORP, INC. (NNM: HCBK) December 16, 2011



Recap of the First Restructuring in March

In March of this year, Hudson City paid off $12.5 bil. of structured putable borrowings

with an average cost of 3.65%. The company incurred a pre-tax charge of $1.17 bil. or

9.4%. The pay down of borrowings was funded by the sale of $8.7 bil. of securities, and

$5.0 bil. of new shorter-term fixed maturity borrowings with an average cost of 0.66%.

The net impact of this transaction produced a pre-tax loss of $919 mil. and reduced

tangible book value by $1.59 per share or 15% compared to year end 2010 levels.



The transaction helped improve the net interest margin by 42 basis points in the second

quarter. The overall reliance on borrowings was reduced to 45% of total funding

(deposits and borrowings), down from 54% before the restructuring. Tangible capital

levels remain at roughly the same level of 9.1% at June 30th compared to 8.8% at year

end 2010.



Recap of the Second Restructuring Today

Today, the company announced that it extinguished $4.3 bil. of structured putable

borrowings with an average cost of 4.21%. The company incurred a pre-tax charge of

$728.5 bil. or 16.9%. The net impact of this transaction produced an after-tax loss of

$440.7 mil. and reduced tangible book value by $0.86 per share or 8.8% compared to the

September 30th tangible book value of $9.75 per share.



By the company’s estimate, the transaction will improve the net interest margin by 20 bp

Note that once the short term

compared to the 3Q net interest margin of 1.97%. The overall reliance on borrowings will funding matures in the back half

be further reduced to 37% of total funding (deposits and borrowings), down from 44% of 2012 the average cost of

before this second restructuring and 54% at year end 2010. Pro forma capital at the bank borrowings will once again be

(tier 1 leverage) and holding company (TCE/TA) will remain essentially flat compared to back above 4%.

current levels of 8.7% and 9.8%.



Figure 1. Total Borrowings



As of 9/30/11 Pro forma 12/31/11



Date Balance Interest Rate Date Balance Interest Rate

Matures at Matures at

2011Q4 750 4 0.55% 2012Q1 900 9 0.98%

2012Q1 900 9 0.98%

2012Q2 750 6 0.74%

2012Q2 750 6 0.74%

2012Q3 750 6 0.85%

2012Q3 750 6 0.85%

Total 2,400 21 0.86%

Total 3,150 25 0.79%



Remaining higer cost legacy borrow ings 13,269 581 4.38%

Remaining higer cost legacy borrow ings 17,569 762 4.34%





Total borrowings 20,719 787 3.80% Total borrowings 15,669 602 3.84%





Source: Company data Source: Company data



In our view, a third restructuring transaction cannot be ruled out. Once the remaining

short-term borrowings are extinguished in the third quarter of next year, the total cost of

borrowings will jump back above 4% as the legacy higher cost structures are all that will

remain. If rates remain low and pre-payment speeds remain high, the asset yield

compression problem will remain acute and margin and earnings pressures will persist.

The company’s current mortgage loan yield of 5.05% remains above the 30 year fixed

rate jumbo offering rate of 4.875%. The company’s current 5:1 jumbo ARM rate is

3.125%. These rates are slightly above the current market rates, in our view. In market

competitor Investors Bancorp (ISBC – $13.14 – Buy) for example is currently offering

a 4.625% rate on a jumbo (> $750k) 30 year fixed rate mortgage.

Figure 2. Restructuring Summaries



Page 2

HUDSON CITY BANCORP, INC. (NNM: HCBK) December 16, 2011





$mil.





Restructuring 1.0

Date 3/28/2011

Borrow ings ex tinguished/restructured 12,500

Pre-tax charge 1,170

Pre-tax charge/balance ex tinguished or restructured 9.4%





Restructuring 1.0

Before After Change

FY 2011 net interest margin (NIM) 1.53% 2.00% 0.47%

2011 GAAP EPS $0.68 $0.72 5.9%

20111Q Tangible book v alue (TBV) estimate $10.88 $9.47 -13.0%

20111Q TCE/TA 8.8% 9.0% 0.20%





Restructuring 2.0

Date 12/16/2011

Borrow ings ex tinguished/restructured 4,300

Pre-tax charge 729

Pre-tax charge/balance ex tinguished or restructured 16.9%





Restructuring 2.0

Before After Change

FY 2012 net interest margin (NIM) 1.85% 2.09% 0.24%

2012 GAAP EPS $0.58 $0.62 6.9%

20114Q Tangible book v alue (TBV) estimate $9.79 $8.89 -9.2%

20114Q TCE/TA 9.7% 9.8% 0.10%





Source: SNL Financial and Sterne Agee estimates





Figure 3. Estimated Fair Value of Borrowings





Quarter Period After Tangible After-Tax

Ending Carrying Fair End Tax Comm on Difference/

Date Value (CV) Value (FV) FV/CV 5 Yr CMT Difference Equity TCE

12/31/2010 29,675 32,976 111.1% 2.01% -1,980 5,354 -37.0%

3/31/2011 22,025 24,085 109.4% 2.24% -1,236 4,573 -27.0%

6/30/2011 21,125 23,511 111.3% 1.76% -1,431 4,732 -30.2%

9/30/2011 20,225 23,299 115.2% 0.96% -1,845 4,823 -38.2%



As of 12/16/11 (1)

Total remaining borrowings 15,175 17,148 113.0% 0.81% -1,184 4,406 -26.9%

Remaining higer cost legacy borrowings 13,269 15,392 116.0% 0.81% -1,274 4,406 -28.9%





1) Sterne Agee estimate based on current FHLBNY rates





Source: Company data









Figure 4. Pro forma Balance Sheet Analysis and Earnings Impact

Page 3

HUDSON CITY BANCORP, INC. (NNM: HCBK) December 16, 2011







Pre-tax Pre-tax After-tax

% of Charge/ Charge/ Charge/

Balance Total Gain Gain Gain

Gross borrow ings ex tinguished 4,300 25% -17.0% -729 -437

Borrow ings restructured 0 0% 0.0% 0 0

Loans sold 0 0% 0.0% 0 0

Cash and liquidity utilized and/or securities sold 4,300 30% 0.0% 0 0

Net impact -729 -437









Pro forma - 9/30/12 Pro Forma

Organic Deleveraging Balance Rate Interest Balance Rate/ Interest

Cash, equiv alents and due from brokers 25% 788 2,473 0.05% 0.3 2,202 0.05% 1.1

Securities 50% 1,575 14,511 2.95% 107.0 10,211 2.75% 280.8

FHLB Stock 727 4.85% 8.8 585 4.85% 28.4

Net loans 25% 788 29,083 4.95% 359.9 29,083 4.75% 1,381.4

Intangibles 152 152

Earning assets 46,793 4.07% 476.0 42,080 4.02% 1,692

Noninterest earning assets 908 908

Total assets 47,701 42,988

Tangible assets 47,549 42,836

Risk w eighted assets 20,988 21,418

RWA/TA 44% 50%





Interest bearing deposits 24,827 1.31% 81.3 24,827 1.31% 325.2

Noninterest bearing deposits 595 0.00% 0.0 595 0.00% 0.0

Repurchase agreements 50% 1,575 6,075 4.50% 68.3 3,925 3.80% 149.2

FHLB borrow ings 50% 1,575 11,000 4.50% 123.8 8,850 3.80% 336.3

Total borrow ings 3,150 17,075 4.50% 192 12,775 3.80% 485

Interest bearing liabilities 41,902 2.61% 273.4 37,602 2.16% 810.7

Other liabilities 225 0.00% 225

Liabilities 42,721 2.56% 273.4 38,421





Shareholders equity 4,979 4,542





Net interest income/net interest spread 1.46% 202.6 1.86% 881.0

Net interest margin (NIM) 1.73% 2.09%





Equity 4,979 4,542

TCE/TA 10.2% 10.2%

TCE/RWA 23.0% 20.5% Change

TBV shares 528 528

TBV $9.15 $8.32 -9%





Securities/assets 30% 24%

Borrow ings/assets 36% 30%

Borrow ings/funding 41% 34%

Loans/deposits 114% 114%





Source: Company data and Sterne Agee estimates









Figure 5. Current Fixed Rate FHLB Advance Rates



Page 4

HUDSON CITY BANCORP, INC. (NNM: HCBK) December 16, 2011









Source: FHLBNY









Page 5

HUDSON CITY BANCORP, INC. (NNM: HCBK) December 16, 2011



Hudson City Bancorp, Inc. Quarterly Income Statement

($000, except per share data)

2011E 2012E 2013E

2010A MAR JUNE SEPT DEC 2011E MAR JUNE SEPT DEC 2012E MAR JUNE SEPT DEC 2013E

Full Year 1 Qtr A 2 Qtr A 3 Qtr A 4 Qtr E Full Year 1 Qtr E 2 Qtr E 3 Qtr E 4 Qtr E Full Year 1 Qtr E 2 Qtr E 3 Qtr E 4 Qtr E Full Year

NET INTEREST INCOME (NII) $1,190,827 $256,401 $272,909 $244,643 $215,273 $989,226 $230,915 $226,504 $223,334 $220,627 $901,380 $221,552 $220,546 $219,651 $218,860 $880,609

LOAN LOSS PROVISION (LLP) $195,000 $40,000 $30,000 $25,000 $28,382 $123,382 $26,296 $24,218 $21,415 $21,475 $93,404 $18,770 $18,985 $16,294 $16,494 $70,544

NII AFTER LLP $995,827 $216,401 $242,909 $219,643 $186,890 $865,843 $204,619 $202,287 $201,919 $199,151 $807,976 $202,782 $201,561 $203,357 $202,366 $810,065

OPERATING FEE INCOME 10,369 2,739 2,732 3,094 3,156 11,721 3,219 3,283 3,349 3,416 13,267 3,484 3,554 3,625 3,698 14,361

GAIN ON SALE INCOME 152,625 102,468 0 0 0 102,468 0 0 0 0 0 0 0 0 0 0

RESTRUCTURING CHARGE - (1,172,092) 0 0 (729) (1,172,821) 0 0 0 0 0 0 0 0 0 0

TOTAL NON INTEREST INCOME 162,994 (1,066,885) 2,732 3,094 (725,344) (1,786,403) 3,219 3,283 3,349 3,416 13,267 3,484 3,554 3,625 3,698 14,361

TOTAL OPERATING REVENUES $1,201,196 $259,140 $275,641 $247,737 $218,428 $1,000,946 $234,134 $229,788 $226,683 $224,043 $914,647 $225,037 $224,100 $223,276 $222,557 $894,970

OPERATING EXPENSES 222,449 55,639 71,117 69,778 65,771 262,305 64,437 64,437 63,598 63,772 256,244 63,241 63,687 64,273 64,833 256,034

OTHER EXPENSES 43,939 12,837 14,720 13,883 13,605 55,045 13,469 13,335 13,335 13,401 53,540 13,535 13,671 13,807 13,945 54,959

AMORTIZATION OF INTANGIBLES 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0

TOTAL NON INTEREST EXPENSES $266,388 $68,476 $85,837 $83,661 $79,376 $317,350 $77,907 $77,771 $76,933 $77,173 $309,784 $76,776 $77,358 $78,080 $78,779 $310,993

OPERATING PRE-TAX INCOME 892,433 (918,960) 159,804 139,076 (617,830) (1,237,910) 129,931 127,799 128,335 125,394 511,459 129,490 127,757 128,902 127,284 513,434

REPORTED INCOME TAXES 355,227 (363,296) 63,796 54,873 (247,132) (491,759) 51,972 51,120 51,334 50,158 204,584 51,796 51,103 51,561 50,914 205,374

OPERATING AFTER-TAX INCOME $450,497 $93,360 $96,008 $84,203 $70,002 $343,573 $77,959 $76,679 $77,001 $75,236 $306,876 $77,694 $76,654 $77,341 $76,371 $308,060



GAAP EARNINGS PER SHARE $1.09 ($1.13) $0.19 $0.17 ($0.75) ($1.51) $0.16 $0.15 $0.16 $0.15 $0.62 $0.1569 $0.1548 $0.1562 $0.1543 $0.62



OPERATING EPS $0.91 $0.19 $0.19 $0.17 $0.14 $0.69 $0.16 $0.15 $0.16 $0.15 $0.62 $0.16 $0.15 $0.16 $0.15 $0.62



Key Ratios

NET INTEREST MARGIN 2.01% 1.72% 2.14% 1.97% 1.85% 1.92% 2.13% 2.10% 2.08% 2.05% 2.09% 2.05% 2.03% 2.00% 1.98% 2.01%

RETURN ON ASSETS 0.88% -3.73% 0.74% 0.66% -3.09% -1.36% 0.70% 0.69% 0.69% 0.68% 0.69% 0.70% 0.68% 0.68% 0.67% 0.68%

RETURN ON TANGIBLE EQUITY 10.0% -48.6% 8.1% 7.0% -33.7% -16.8% 7.0% 6.9% 6.8% 6.7% 6.8% 6.8% 6.7% 6.7% 6.6% 6.7%

GAAP EFFICIENCY RATIO 22% 26% 31% 34% 36% 32% 33% 34% 34% 34% 34% 34% 35% 35% 35% 35%

FEES/REVENUES 1% 1% 1% 1% 1% 1% 1% 1% 1% 2% 1% 2% 2% 2% 2% 2%

EQUITY TO ASSETS 9.0% 9.0% 9.4% 9.8% 10.1% 10.1% 10.3% 10.4% 10.5% 10.5% 10.5% 10.5% 10.5% 10.5% 10.4% 10.4%

TANGIBLE EQUITY TO TANGIBLE ASSETS 8.8% 8.7% 9.1% 9.5% 9.8% 9.8% 10.0% 10.0% 10.1% 10.2% 10.2% 10.2% 10.1% 10.1% 10.1% 10.1%

LOANS TO DEPOSITS 123% 119% 119% 118% 117% 117% 117% 117% 118% 119% 119% 119% 119% 120% 120% 120%

RESERVE TO LOANS 0.77% 0.84% 0.86% 0.89% 0.93% 0.93% 0.95% 0.97% 0.97% 0.98% 0.98% 0.98% 0.97% 0.96% 0.95% 0.95%

RESERVE TO NPAs 26% 27% 27% 26% 26% 26% 27% 28% 29% 32% 32% 36% 38% 40% 43% 43%

NPAs TO LOANS + OREO 2.96% 3.06% 3.16% 3.39% 3.57% 3.57% 3.51% 3.50% 3.32% 3.06% 3.06% 2.70% 2.54% 2.38% 2.23% 2.23%

PROVISION/NCOs 182% 188% 130% 135% 127% 127% 130% 120% 116% 116% 116% 112% 112% 107% 106% 106%

NCOs TO AVERAGE LOANS 0.31% 0.28% 0.30% 0.25% 0.30% 0.28% 0.28% 0.28% 0.25% 0.25% 0.26% 0.23% 0.23% 0.20% 0.20% 0.21%

STATED BOOK VALUE/SHARE $11.16 $9.58 $9.89 $10.05 $9.19 $9.19 $9.27 $9.30 $9.37 $9.40 $9.40 $9.48 $9.51 $9.58 $9.62 $9.62

TANGIBLE BOOK VALUE/SHARE $10.85 $9.26 $9.58 $9.75 $8.89 $8.89 $8.96 $8.99 $9.07 $9.09 $9.09 $9.17 $9.20 $9.28 $9.31 $9.31





Analyst: Matthew B Kelley 207.699.5800

Source: Company reports and Sterne Agee estimates









Page 6

HUDSON CITY BANCORP, INC. (NNM: HCBK) December 16, 2011



APPENDIX SECTION

Company Description: Hudson City Bancorp, Inc. is the parent company of Hudson City Savings Bank, a well-established

community banking institution with a longstanding tradition of service excellence. The bank has 135 full-service branches in the New

York metropolitan area.



IMPORTANT DISCLOSURES:

Price Target Risks & Related Risk Factors:

Investment risks associated with the achievement of target prices consist of developments which could cause earnings to come in

lower than expectations. For bank and thrift institutions we believe the most serious risk is the potential for loan credit quality to

deteriorate thereby obviating a higher provision for loan losses to cover an immediate loan charge-off or to build a higher loan loss

reserve to absorb a potential loss. The higher the degree of geographic focus, the greater the risk that worsening economic

circumstances could have an adverse impact on loan portfolio quality. Also, a higher degree of concentration in specific types of

loans or borrowers increases the potential for a large adverse impact on earnings. Banks and thrift institutions are also subject to

interest rate sensitivity risks. Depending upon how the balance sheet is structured, increases or decreases in rates could reduce

earnings. Additionally, regardless of how the balance sheet is positioned, a volatile interest rate environment could have an adverse

impact on earnings. Depository institutions also possess compliance and operating risk such as the implementation of policies,

procedures and controls required by the Bank Secrecy Act and U.S. Patriot Act. Failure to comply fully and effectively with these

laws and other regulatory regimes could result in high fines and restrictions on the institution's freedom of action. Another prominent

risk associated with bank and thrift stocks involves the potential for overpaying for an acquisition or an ineffective integration once an

acquisition is closed. Paying too much for an acquisition or failing to properly integrate the acquired franchise could reduce earnings.

For a complete discussion of the risk factors that could affect the market price of a company's shares, refer to the most recent Form 10-

Q or 10-K that a company has filed with the Securities and Exchange Commission.



Valuation Methodology:

Our ratings are based on a wide array of valuation methodology. Our "top-down" valuation approach makes extensive use of peer

groups based on market capitalization, asset size, geographic location or the nature of the institution. We compare various valuation

metrics to the peer group. Relevant valuation metrics include, but are not limited to, price to earnings (trailing twelve month as well

as estimates), price to book value, price to tangible book value, dividend yield and several types of deposit premiums. Our "bottom-

up" valuation process examines the specific geographic franchise, management experience and record, credit culture, deposit

composition, loan portfolio characteristics and interest rate sensitivity to aid in determining the overall prospects for the institution. At

this level we sometimes employ discounted cash flow analysis to the specific institution. Another valuation process we go through

attempts to determine the value of a depository institution as an acquisition. This requires judgments with regard to potential buyers

and their wherewithal to purchase the candidate.



Regulation Analyst Certification:

I, Matthew Kelley, (207) 699-5800, Mike I. Shafir, (212) 763-8239, Matthew Breese, (207) 699-5800, hereby certify the views

expressed in this research report accurately reflect my personal views about the subject security(ies) or issuer(s). I further certify that

no part of my compensation was, is, or will be, directly or indirectly, related to the specific recommendations or views expressed by

me in this report.



Sterne, Agee & Leach, Inc. Disclosure Legend as of December 16, 2011:



Company Disclosure(s) – See Below

Hudson City Bancorp, Inc. (HCBK - NNM): 1

Investors Bancorp, Inc. (ISBC - NNM): 1



Disclosure Legend

1. Sterne, Agee & Leach, Inc. makes a market in the shares of the subject company.

2. Sterne, Agee & Leach, Inc. has, over the past 12 months, managed or co-managed a public securities offering or

provided other investment banking services for the subject company.

3. Sterne, Agee & Leach, Inc. received compensation for products or services other than investment banking services

from the subject company in the past 12 months.

4. The Sterne Agee analyst who has active coverage on this company owns a position in the subject company.

5. Sterne, Agee & Leach, Inc. or its affiliates beneficially own 1% or more of any class of common equity securities of the

subject company.







Appendix Section, Page I

HUDSON CITY BANCORP, INC. (NNM: HCBK) December 16, 2011



Sterne Agee & Leach, Inc. expects to receive or intends to seek compensation for investment banking services from the subject

company in the next three months. Sterne, Agee & Leach, Inc.’s research analysts receive compensation that is based upon various

factors, including Sterne, Agee & Leach, Inc.’s total revenues, a portion of which is generated by investment banking activities.



Definition of Investment Ratings:

BUY: We expect this stock to outperform the industry over the next 12 months.

NEUTRAL: We expect this stock to perform in line with the industry over the next 12 months.

UNDERPERFORM: We expect this stock to underperform the industry over the next 12 months.

RESTRICTED: Restricted list requirements preclude comment.



Ratings Distribution:

Of the securities rated by Sterne, Agee & Leach, Inc., as of September 30, 2011, 51.4% had a BUY rating, 44.4% had a NEUTRAL

rating, 3.2% had a UNDERPERFORM rating, and 0% was RESTRICTED. Within those ratings categories, 3.8% of the securities

rated BUY, 1.1% rated NEUTRAL, 0% rated UNDERPERFORM, and 0% rated RESTRICTED received investment banking services

from Sterne, Agee & Leach, Inc., within the 12 months preceding September 30, 2011.



ADDITIONAL INFORMATION AVAILABLE UPON REQUEST: Contact Robert Hoehn at 1-212-338-4731.

Other Disclosures:

Opinions expressed are our present opinions only. This material is based upon information that we consider reliable, but we do not

represent that it is accurate or complete, and it should not be relied upon as such. Sterne, Agee & Leach, Inc., its affiliates, or one or

more of its officers, employees, or consultants may, at times, have long or short or options positions in the securities mentioned herein

and may act as principal or agent to buy or sell such securities.



Copyright © 2011 Sterne, Agee & Leach, Inc. All Rights Reserved.



Sterne, Agee & Leach, Inc. disclosure price charts are updated within the first fifteen days of each new calendar quarter per FINRA

regulations. Price charts for companies initiated upon in the current quarter, and rating and target price changes occurring in the

current quarter, will not be displayed until the following quarter.



Price Chart(s):









To receive price charts or other disclosures on the companies mentioned in this report, please contact

Sterne, Agee & Leach, Inc. toll-free at (800) 240-1438 or (205) 949-3689.









Appendix Section, Page II

Founded in 1901, Sterne Agee has been providing investors like you with high-quality investment opportunities for over a century. During the

early years, our founders prominently established themselves in the financial securities industry in the southeastern United States. Today, we

have expanded to serve all regions of the country. Sterne, Agee is headquartered in Birmingham, Alabama with offices in 22 states. Sterne

Agee is one of the largest independent firms in the country. Sterne, Agee & Leach, Inc. is a division of Sterne Agee Group, Inc., which also

includes The Trust Company of Sterne, Agee & Leach, Inc.; Sterne Agee Asset Management, Inc.; Sterne Agee Clearing, Inc.; and Sterne Agee

Financial Services, Inc.—www.sterneagee.com





EQUITY CAPITAL MARKETS

Ryan Medo Managing Dir., Eq. Cap. Mkts. (205) 949-3623 William McIlroy Director, Equity Products (212) 338-4781

Paul Garner Associate (212) 338-4799



INSTITUTIONAL SALES INSTITUTIONAL TRADING

Steve Pokorny Head of Institutional Sales (214) 702-4020 JT Cacciabaudo Head of Trading (212) 763-8288



EQUITY RESEARCH

Robert Hoehn Director of Research (212) 338-4731

CONSUMER FINANCIAL SERVICES (CONT.)

Apparel Retailing & Toys Mortgage Finance & Specialty Finance

Margaret Whitfield SVP, Sr. Analyst (973) 519-1019 Henry J. Coffey, Jr., CFA Mng. Dir. (615) 760-1472

Tom Nikic, CFA Analyst (212) 338-4784 Jason Weaver Analyst (615) 760-1475

Calvin Hotrum Associate (615) 760-1476

Educational Services / Interactive Entertainment

Arvind Bhatia, CFA Mng. Dir. (214) 702-4001

Property/Casualty Insurance

Brett Strauser Analyst (214) 702-4009

Dan Farrell Mng. Dir. (212) 338-4782

Footwear & Apparel Nitin Chhabra, FCAS Analyst (212) 338-4779

Sam Poser Mng. Dir. (212) 763-8226

Kenneth M. Stumphauzer, CFA Sr. Analyst (212) 763-8287 GLOBAL INDUSTRIAL INFRASTRUCTURE (GII)

Jessica Bornn Associate (212) 338-4721 ACME &Latin America

Ben Elias, CFA SVP, Sr. Analyst (212) 338-4706

Leisure & Entertainment Ali-Ahmad Faghri Associate (646) 376-5304

David Bain Mng. Dir. (949) 721-6651

Sherry Yin Associate (949) 721-6651 Aerospace

Peter Arment Mng. Dir. (646) 376-5336

Restaurants Josh W. Sullivan Analyst (646) 376-5337

Lynne Collier Mng. Dir. (214) 702-4045

Philip May Analyst (214) 702-4004 Coal, Metals & Mining, Engineering & Construction

Michael S. Dudas, CFA Mng. Dir. (646) 376-5329

ENERGY Satyadeep Jain Analyst (646) 376-5357

Exploration & Production Patrick Uotila, CPA Analyst (646) 376-5358

Michael J. McAllister Mng. Dir. (212) 338-4783

Tim Rezvan, CFA Analyst (212) 338-4736 CONSTRUCTION MATERIALS & DIVERSIFIED INDUSTRIALS

Ryan Mueller Associate (212) 338-4732 Todd Vencil, CFA SVP, Sr. Analyst (804) 282-7385

Kevin Bennett, CFA Analyst (804) 282-4506

Oilfield Services & Equipment

Stephen D. Gengaro Mng. Dir. (646) 376-5331 HEALTHCARE

Grant Fox Associate (212) 338-4723 PHARMACEUTICAL SERVICES

Greg T. Bolan Mng. Dir. (615) 760-1469

FINANCIAL SERVICES

Asset Management TECHNOLOGY

Jason Weyeneth, CFA SVP, Sr. Analyst (212) 763-8293 Data Networking and Storage

Charles Warren Analyst (646) 376-5309 Alex Kurtz Mng. Dir (415) 402-6015

Amelia Harris Analyst (415) 402-6018

Banks & Thrifts

Matthew Kelley Mng. Dir. (207) 699-5800 Financial Technology

Mike I. Shafir SVP, Sr. Analyst (212) 763-8239 Greg Smith Mng. Dir (818) 615-2029

Matthew Breese Analyst (207) 699-5800 Jennifer Dugan Analyst (415) 402-6051

Brett Rabatin, CFA SVP, Sr. Analyst (877) 457-8625

Kenneth James Analyst (615) 760-1474 Hardware, Mobile Devices, IT Supply Chain

Nathan Race Associate (615) 760-1477 Shaw Wu SVP, Sr. Analyst (415) 362-7431

Peyton Green Mng. Dir. (877) 492-2663

Zachary Wollam Analyst (615) 760-1468 LED Supply Chain

Todd L. Hagerman Mng. Dir. (212) 338-4744 Andrew Huang Mng. Dir. (415) 362-6143

Robert Greene Analyst (212) 763-8296 John Shen Associate (415) 402-6052



Semiconductors

Life Insurance Vijay Rakesh Mng. Dir. (312) 525-8431

John M. Nadel Mng. Dir. (212) 338-4717 Mark Kelley Analyst (312) 525-8430

Alex Levine Associate (212) 338-4748

TRANSPORTATION, SERVICES & EQUIPMENT

Jeffrey A. Kauffman Mng. Dir. (212) 338-4765

Sal Vitale VP, Analyst (212) 338-4766

Kanchana Pinnapureddy Associate (212) 338-4767



Email Address for Sterne Agee Employees: first initial + last name@sterneagee.com (e.g., jsmith@sterneagee.com)