NYCB 2017 Annual Report

73 Income Tax Expense In the twelve months ended December 31, 2016, we recorded income tax expense of $281.7 million, reflecting pre-tax income of $777.1 million and an effective tax rate of 36.25%. In the prior year, we recorded an income tax benefit of $84.9 million as a result of having recorded a $132.0 million pre-tax loss. QUARTERLY FINANCIAL DATA The following table sets forth selected unaudited quarterly financial data for the years ended December 31, 2017 and 2016: 2017 2016 (in thousands, except per share data) 4th 3rd 2nd 1st 4th 3rd 2nd 1st Net interest income $270,974 $276,343 $287,769 $294,917 $315,520 $318,423 $325,573 $327,866 Provision for (recoveries of) loan losses 2,926 44,585 (6,261) (4,008) 3,516 (55) 895 (176 ) Non-interest income 25,343 108,928 50,437 32,172 32,374 40,595 37,366 35,237 Non-interest expense 148,484 162,234 163,765 166,943 170,602 161,685 160,911 158,448 Income before income taxes 144,907 178,452 180,702 164,154 173,776 197,388 201,133 204,831 Income tax expense 8,386 67,984 65,447 60,197 60,043 72,089 74,673 74,922 Net income $136,521 $110,468 $115,255 $103,957 $113,733 $125,299 $126,460 $129,909 Preferred stock dividends 8,207 8,207 8,207 -- -- -- -- -- Net income available to common shareholders $128,314 $102,261 $107,048 $103,957 $113,733 $125,299 $126,460 $129,909 Basic earnings per common share $0.26 $0.21 $0.22 $0.21 $0.23 $0.26 $0.26 $0.27 Diluted earnings per common share $0.26 $0.21 $0.22 $0.21 $0.23 $0.26 $0.26 $0.27 IMPACT OF INFLATION The consolidated financial statements and notes thereto presented in this report have been prepared in accordance with GAAP, which requires that we measure our financial condition and operating results in terms of historical dollars, without considering changes in the relative purchasing power of money over time due to inflation. The impact of inflation is reflected in the increased cost of our operations. Unlike industrial companies, nearly all of a bank’s assets and liabilities are monetary in nature. As a result, the impact of interest rates on our performance is greater than the impact of general levels of inflation. Interest rates do not necessarily move in the same direction, or to the same extent, as the prices of goods and services. IMPACT OF RECENT ACCOUNTING PRONOUNCEMENTS Refer to Note 2, “Summary of Significant Accounting Policies,” in Item 8, “Financial Statements and Supplementary Data,” for a discussion of the impact of recent accounting pronouncements on our financial condition and results of operations. RECONCILIATIONS OF STOCKHOLDERS’ EQUITY, COMMON STOCKHOLDERS’ EQUITY, AND TANGIBLE COMMON STOCKHOLDERS’ EQUITY; TOTAL ASSETS AND TANGIBLE ASSETS; AND THE RELATED MEASURES While stockholders’ equity, common stockholders’ equity, total asse ts, and book value per common share are financial measures that are recorded in accordance with U.S. generally accepted accounting principles (“GAAP”), tangible common stockholders’ equity, tangible assets, and tangible book value per common share are not. It is management’s belief that these non -GAAP measures should be disclosed in this report and others we issue for the following reasons: 1. Tangible common stockholders’ equity is an important indication of the Company’s ability to grow organically and through business combinations, as well as its ability to pay dividends and to engage in various capital management strategies. 2. Tangible book value per common share and the ratio of tangible common stockholders’ equity to tangible assets are among the capital measures considered by current and prospective investors, both independent of, and in comparison with, the Company’s peers. Tangible common stockholders’ equity, tangible assets, and the related non -GAAP measures should not be considered in isolatio n or as a substitute for stockholders’ equity, common stockholders’ equity, total assets, or any