December 16, 2011 | 9 Pages

Banks & Thrifts

Company Report

Hudson City Bancorp, Inc.

(NNM: HCBK)
RESTRUCTURING 2.0 COMES AHEAD OF SCHEDULE BUT SMALLER THAN EXPECTED - LOW RATE ENVIRONMENT WILL CONTINUE TO WEIGH ON EARNINGS; ADJUSTING ESTIMATES
2nd Restructuring Announced. Before the open today, Hudson City announced their second balance sheet restructuring plan in 2011. In the transaction today, the company extinguished $4.3 bil. of higher cost (4.21%) borrowings at a pre-tax cost of $729 mil. or a 17% pre-tax charge. The first restructuring in March had a 9.4% pre-tax charge on the extinguishment of borrowings. This restructuring was smaller than the $10 - $15 bil. extinguishment/restructuring we envisioned and outlined in our October 26th note. Why Now? We had been of the view that the company would attempt to shrink organically into early next year, build capital and then execute a larger restructuring in conjunction with an asset sale (loans and securities) to offset the charges. In our view, the asset sale part of equation may have become unfeasible due to the secondary market pricing pressures for a jumbo prime loan sale. With cash and liquidity building at a more rapid rate than expected (a separate concern noted below), we believe the company chose to execute a smaller transaction today to continue working down this challenge. Earnings and Capital Impact 4Q Core EPS Lowered on NIM. We increased our full year 2012 and 2013 earnings estimates by 7% to $0.62 for each year. Tangible book value (ex unallocated ESOP shares) is expected to decline by 9% to $8.89 per share. Pro forma capital at the bank (tier 1 leverage) and holding company (TCE/TA) will remain essentially flat compared to current levels of 8.7% and 9.8%. We lowered our 4Q operating estimate by a penny to $0.14 per share (from $0.15) to reflect elevated prepayment activity in the quarter. Our full year 2011 estimate was reduced to -$1.51 to reflect the charge and lower 4Q 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 companys 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 companys business model, regulators will require meaningfully higher levels of capital for the company in the years ahead.

RATING: NEUTRAL
Matthew Kelley (207) 699-5800
mkelley@sterneagee.com

Mike I. Shafir (212) 763-8239

mshafir@sterneagee.com

Matthew Breese (207) 699-5800

mbreese@sterneagee.com

Fiscal Year Ends Dec

Rating: Price: Close Price Target: 52-wk Range: Market Capitalization (M): Shares Outstanding (M): Assets (M): Avg. Daily Vol. (000): Dividend: Dividend Yield: Tangible Book Value: Price/Tangible Book Value: Neutral $5.78 -$5.09-$13.26 $3,049 527.5 $45,076 0 $0.32 5.5% $8.89 65%

Earnings Summary
FYE Dec 2011E 2012E 2013E

EPS & P/E Summary

EPS: Q1 Q2 Q3 Q4 Full Year P/E Ratio: 2011E -$1.13 $0.19 $0.17 -$0.75 -$1.51 -3.8 2011 Prior -$1.13 $0.19 $0.17 $0.15 -$0.61 -2012E $0.16 $0.15 $0.16 $0.15 $0.62 9.3 2012 Prior $0.15 $0.14 $0.15 $0.14 $0.58 -2013E $0.16 $0.15 $0.16 $0.15 $0.62 9.3 2013 Prior $0.14 $0.14 $0.15 $0.15 $0.58 --

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.

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Birmingham, AL 35209

205-949-3500

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

HUDSON CITY BANCORP, INC. (NNM: HCBK)

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 companys estimate, the transaction will improve the net interest margin by 20 bp compared to the 3Q net interest margin of 1.97%. The overall reliance on borrowings will be further reduced to 37% of total funding (deposits and borrowings), down from 44% before this second restructuring and 54% at year end 2010. Pro forma capital at the bank (tier 1 leverage) and holding company (TCE/TA) will remain essentially flat compared to current levels of 8.7% and 9.8%. Figure 1. Total Borrowings
As of 9/30/11 Date Matures at 2011Q4 2012Q1 2012Q2 2012Q3 Total Remaining higer cost legacy borrow ings Total borrowings Source: Company data 750 900 750 750 3,150 17,569 20,719 4 9 6 6 25 762 787 0.55% 0.98% 0.74% 0.85% 0.79% 4.34% 3.80% Balance Interest Rate

December 16, 2011

Note that once the short term funding matures in the back half of 2012 the average cost of borrowings will once again be back above 4%.

Pro forma 12/31/11 Date Matures at 2012Q1 2012Q2 2012Q3 Total Remaining higer cost legacy borrow ings Total borrowings Source: Company data 900 750 750 2,400 13,269 15,669 9 6 6 21 581 602 0.98% 0.74% 0.85% 0.86% 4.38% 3.84% Balance Interest Rate

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 companys current mortgage loan yield of 5.05% remains above the 30 year fixed rate jumbo offering rate of 4.875%. The companys 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

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HUDSON CITY BANCORP, INC. (NNM: HCBK)

$mil. Restructuring 1.0 Date Borrow ings ex tinguished/restructured Pre-tax charge Pre-tax charge/balance ex tinguished or restructured 3/28/2011 12,500 1,170 9.4% Restructuring 1.0 Before FY 2011 net interest margin (NIM) 2011 GAAP EPS 20111Q Tangible book v alue (TBV) estimate 20111Q TCE/TA Restructuring 2.0 Date Borrow ings ex tinguished/restructured Pre-tax charge Pre-tax charge/balance ex tinguished or restructured 12/16/2011 4,300 729 16.9% Restructuring 2.0 Before FY 2012 net interest margin (NIM) 2012 GAAP EPS 20114Q Tangible book v alue (TBV) estimate 20114Q TCE/TA Source: SNL Financial and Sterne Agee estimates 1.85% $0.58 $9.79 9.7% After 2.09% $0.62 $8.89 9.8% Change 0.24% 6.9% -9.2% 0.10% 1.53% $0.68 $10.88 8.8% After 2.00% $0.72 $9.47 9.0% Change 0.47% 5.9% -13.0% 0.20%

December 16, 2011

Figure 3. Estimated Fair Value of Borrowings

Quarter Ending Date 12/31/2010 3/31/2011 6/30/2011 9/30/2011 As of 12/16/11 (1) Total remaining borrowings Remaining higer cost legacy borrowings 15,175 13,269 17,148 15,392 113.0% 116.0% Carrying Value (CV) 29,675 22,025 21,125 20,225 Fair Value (FV) 32,976 24,085 23,511 23,299 FV/CV 111.1% 109.4% 111.3% 115.2%

Period End 5 Yr CMT 2.01% 2.24% 1.76% 0.96%

After Tax Difference -1,980 -1,236 -1,431 -1,845

Tangible Comm on Equity 5,354 4,573 4,732 4,823

After-Tax Difference/ TCE -37.0% -27.0% -30.2% -38.2%

0.81% 0.81%

-1,184 -1,274

4,406 4,406

-26.9% -28.9%

1) Sterne Agee estimate based on current FHLBNY rates Source: Company data

Figure 4. Pro forma Balance Sheet Analysis and Earnings Impact

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HUDSON CITY BANCORP, INC. (NNM: HCBK)

December 16, 2011

Pre-tax Balance Gross borrow ings ex tinguished Borrow ings restructured Loans sold Cash and liquidity utilized and/or securities sold Net impact 4,300 0 0 4,300 % of Total 25% 0% 0% 30% Charge/ Gain -17.0% 0.0% 0.0% 0.0%

Pre-tax Charge/ Gain -729 0 0 0 -729

After-tax Charge/ Gain -437 0 0 0 -437

Pro forma - 9/30/12 Organic Deleveraging Cash, equiv alents and due from brokers Securities FHLB Stock Net loans Intangibles Earning assets Noninterest earning assets Total assets Tangible assets Risk w eighted assets RWA/TA 25% 788 25% 50% 788 1,575 Balance 2,473 14,511 727 29,083 152 46,793 908 47,701 47,549 20,988 44% 4.07% 476.0 Rate 0.05% 2.95% 4.85% 4.95% Interest 0.3 107.0 8.8 359.9 Balance 2,202 10,211 585 29,083 152 42,080 908 42,988 42,836 21,418 50%

Pro Forma Rate/ 0.05% 2.75% 4.85% 4.75% Interest 1.1 280.8 28.4 1,381.4

4.02%

1,692

Interest bearing deposits Noninterest bearing deposits Repurchase agreements FHLB borrow ings Total borrow ings Interest bearing liabilities Other liabilities Liabilities 50% 50% 1,575 1,575 3,150

24,827 595 6,075 11,000 17,075 41,902 225 42,721

1.31% 0.00% 4.50% 4.50% 4.50% 2.61% 0.00% 2.56%

81.3 0.0 68.3 123.8 192 273.4

24,827 595 3,925 8,850 12,775 37,602 225

1.31% 0.00% 3.80% 3.80% 3.80% 2.16%

325.2 0.0 149.2 336.3 485 810.7

273.4

38,421

Shareholders equity

4,979

4,542

Net interest income/net interest spread Net interest margin (NIM)

1.46% 1.73%

202.6

1.86% 2.09%

881.0

Equity TCE/TA TCE/RWA TBV shares TBV Securities/assets Borrow ings/assets Borrow ings/funding Loans/deposits Source: Company data and Sterne Agee estimates

4,979 10.2% 23.0% 528 $9.15 30% 36% 41% 114%

4,542 10.2% 20.5% 528 $8.32 24% 30% 34% 114% -9% Change

Figure 5. Current Fixed Rate FHLB Advance Rates

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HUDSON CITY BANCORP, INC. (NNM: HCBK)

December 16, 2011

Source: FHLBNY

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HUDSON CITY BANCORP, INC. (NNM: HCBK)

December 16, 2011

Hudson City Bancorp, Inc. Quarterly Income Statement

($000, except per share data) 2010A Full Year NET INTEREST INCOME (NII) LOAN LOSS PROVISION (LLP) NII AFTER LLP OPERATING FEE INCOME GAIN ON SALE INCOME RESTRUCTURING CHARGE TOTAL NON INTEREST INCOME TOTAL OPERATING REVENUES OPERATING EXPENSES OTHER EXPENSES AMORTIZATION OF INTANGIBLES TOTAL NON INTEREST EXPENSES OPERATING PRE-TAX INCOME REPORTED INCOME TAXES OPERATING AFTER-TAX INCOME GAAP EARNINGS PER SHARE OPERATING EPS $1,190,827 $195,000 $995,827 MAR 1 Qtr A 2011E JUNE SEPT 2 Qtr A 3 Qtr A DEC 4 Qtr E 2011E Full Year MAR 1 Qtr E 2012E JUNE SEPT 2 Qtr E 3 Qtr E DEC 4 Qtr E 2012E Full Year MAR 1 Qtr E 2013E JUNE SEPT 2 Qtr E 3 Qtr E DEC 4 Qtr E 2013E Full Year $880,609 $70,544 $810,065 14,361 0 0 14,361 $894,970 256,034 54,959 0 $310,993 513,434 205,374 $308,060 $0.62 $0.62

$256,401 $272,909 $244,643 $215,273 $40,000 $30,000 $25,000 $28,382 $216,401 $242,909 $219,643 $186,890 2,732 0 0 2,732 3,094 0 0 3,094 3,156 0 (729) (725,344)

$989,226 $230,915 $226,504 $223,334 $220,627 $123,382 $26,296 $24,218 $21,415 $21,475 $865,843 $204,619 $202,287 $201,919 $199,151 11,721 102,468 (1,172,821) (1,786,403) 3,219 0 0 3,219 3,283 0 0 3,283 3,349 0 0 3,349 3,416 0 0 3,416

$901,380 $221,552 $220,546 $219,651 $218,860 $93,404 $18,770 $18,985 $16,294 $16,494 $807,976 $202,782 $201,561 $203,357 $202,366 13,267 0 0 13,267 3,484 0 0 3,484 3,554 0 0 3,554 3,625 0 0 3,625 3,698 0 0 3,698

10,369 2,739 152,625 102,468 - (1,172,092) 162,994 (1,066,885) $1,201,196 222,449 43,939 0 $266,388 892,433 355,227 $450,497 $1.09 $0.91

$259,140 $275,641 $247,737 $218,428 55,639 12,837 0 $68,476 (918,960) (363,296) $93,360 ($1.13) $0.19 71,117 14,720 0 $85,837 159,804 63,796 $96,008 $0.19 $0.19 69,778 13,883 0 $83,661 139,076 54,873 $84,203 $0.17 $0.17 65,771 13,605 0 $79,376 (617,830) (247,132) $70,002 ($0.75) $0.14

$1,000,946 $234,134 $229,788 $226,683 $224,043 262,305 55,045 0 $317,350 (1,237,910) (491,759) $343,573 ($1.51) $0.69 64,437 13,469 0 $77,907 129,931 51,972 $77,959 $0.16 $0.16 64,437 13,335 0 $77,771 127,799 51,120 $76,679 $0.15 $0.15 63,598 13,335 0 $76,933 128,335 51,334 $77,001 $0.16 $0.16 63,772 13,401 0 $77,173 125,394 50,158 $75,236 $0.15 $0.15

$914,647 $225,037 $224,100 $223,276 $222,557 256,244 53,540 0 $309,784 511,459 204,584 $306,876 $0.62 $0.62 63,241 13,535 0 $76,776 129,490 51,796 $77,694 $0.1569 $0.16 63,687 13,671 0 $77,358 127,757 51,103 $76,654 $0.1548 $0.15 64,273 13,807 0 $78,080 128,902 51,561 $77,341 $0.1562 $0.16 64,833 13,945 0 $78,779 127,284 50,914 $76,371 $0.1543 $0.15

Key Ratios
NET INTEREST MARGIN RETURN ON ASSETS RETURN ON TANGIBLE EQUITY GAAP EFFICIENCY RATIO FEES/REVENUES EQUITY TO ASSETS TANGIBLE EQUITY TO TANGIBLE ASSETS LOANS TO DEPOSITS RESERVE TO LOANS RESERVE TO NPAs NPAs TO LOANS + OREO PROVISION/NCOs NCOs TO AVERAGE LOANS STATED BOOK VALUE/SHARE TANGIBLE BOOK VALUE/SHARE 2.01% 0.88% 10.0% 22% 1% 9.0% 8.8% 123% 0.77% 26% 2.96% 182% 0.31% $11.16 $10.85 1.72% -3.73% -48.6% 26% 1% 9.0% 8.7% 119% 0.84% 27% 3.06% 188% 0.28% $9.58 $9.26 2.14% 0.74% 8.1% 31% 1% 9.4% 9.1% 119% 0.86% 27% 3.16% 130% 0.30% $9.89 $9.58 1.97% 0.66% 7.0% 34% 1% 9.8% 9.5% 118% 0.89% 26% 3.39% 135% 0.25% $10.05 $9.75 1.85% -3.09% -33.7% 36% 1% 10.1% 9.8% 117% 0.93% 26% 3.57% 127% 0.30% $9.19 $8.89 1.92% -1.36% -16.8% 32% 1% 10.1% 9.8% 117% 0.93% 26% 3.57% 127% 0.28% $9.19 $8.89 2.13% 0.70% 7.0% 33% 1% 10.3% 10.0% 117% 0.95% 27% 3.51% 130% 0.28% $9.27 $8.96 2.10% 0.69% 6.9% 34% 1% 10.4% 10.0% 117% 0.97% 28% 3.50% 120% 0.28% $9.30 $8.99 2.08% 0.69% 6.8% 34% 1% 10.5% 10.1% 118% 0.97% 29% 3.32% 116% 0.25% $9.37 $9.07 2.05% 0.68% 6.7% 34% 2% 10.5% 10.2% 119% 0.98% 32% 3.06% 116% 0.25% $9.40 $9.09 2.09% 0.69% 6.8% 34% 1% 10.5% 10.2% 119% 0.98% 32% 3.06% 116% 0.26% $9.40 $9.09 2.05% 0.70% 6.8% 34% 2% 10.5% 10.2% 119% 0.98% 36% 2.70% 112% 0.23% $9.48 $9.17 2.03% 0.68% 6.7% 35% 2% 10.5% 10.1% 119% 0.97% 38% 2.54% 112% 0.23% $9.51 $9.20 2.00% 0.68% 6.7% 35% 2% 10.5% 10.1% 120% 0.96% 40% 2.38% 107% 0.20% $9.58 $9.28 1.98% 0.67% 6.6% 35% 2% 10.4% 10.1% 120% 0.95% 43% 2.23% 106% 0.20% $9.62 $9.31 2.01% 0.68% 6.7% 35% 2% 10.4% 10.1% 120% 0.95% 43% 2.23% 106% 0.21% $9.62 $9.31
207.699.5800

Analyst: Matthew B Kelley

Source: Company reports and Sterne Agee estimates

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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 10Q 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 "bottomup" 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 Hudson City Bancorp, Inc. (HCBK - NNM): Investors Bancorp, Inc. (ISBC - NNM): Disclosure(s) See Below 1 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 3. 4. 5.
provided other investment banking services for the subject company. Sterne, Agee & Leach, Inc. received compensation for products or services other than investment banking services from the subject company in the past 12 months. The Sterne Agee analyst who has active coverage on this company owns a position in the subject company. 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: NEUTRAL: UNDERPERFORM: RESTRICTED: We expect this stock to outperform the industry over the next 12 months. We expect this stock to perform in line with the industry over the next 12 months. We expect this stock to underperform the industry over the next 12 months. 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 Paul Garner Director, Equity Products Associate (212) 338-4781 (212) 338-4799

Steve Pokorny

INSTITUTIONAL SALES Head of Institutional Sales

Robert Hoehn

(214) 702-4020

JT Cacciabaudo

INSTITUTIONAL TRADING Head of Trading

(212) 763-8288

EQUITY RESEARCH
Director of Research (212) 338-4731

CONSUMER Apparel Retailing & Toys

Margaret Whitfield Tom Nikic, CFA Arvind Bhatia, CFA Brett Strauser SVP, Sr. Analyst Analyst Mng. Dir. Analyst Mng. Dir. Sr. Analyst Associate Mng. Dir. Associate (973) 519-1019 (212) 338-4784 (214) 702-4001 (214) 702-4009 (212) 763-8226 (212) 763-8287 (212) 338-4721 (949) 721-6651 (949) 721-6651

FINANCIAL SERVICES (CONT.) Mortgage Finance & Specialty Finance

Henry J. Coffey, Jr., CFA Jason Weaver Calvin Hotrum Mng. Dir. Analyst Associate (615) 760-1472 (615) 760-1475 (615) 760-1476

Educational Services / Interactive Entertainment

Property/Casualty Insurance
Dan Farrell Nitin Chhabra, FCAS Mng. Dir. Analyst (212) 338-4782 (212) 338-4779

Footwear & Apparel

Sam Poser Kenneth M. Stumphauzer, CFA Jessica Bornn

GLOBAL INDUSTRIAL INFRASTRUCTURE (GII) ACME &Latin America

Ben Elias, CFA Ali-Ahmad Faghri SVP, Sr. Analyst Associate Mng. Dir. Analyst (212) 338-4706 (646) 376-5304 (646) 376-5336 (646) 376-5337

Leisure & Entertainment

David Bain Sherry Yin

Aerospace
Peter Arment Josh W. Sullivan

Restaurants
Lynne Collier Philip May Mng. Dir. Analyst (214) 702-4045 (214) 702-4004

Coal, Metals & Mining, Engineering & Construction

Michael S. Dudas, CFA Satyadeep Jain Patrick Uotila, CPA Mng. Dir. Analyst Analyst SVP, Sr. Analyst Analyst (646) 376-5329 (646) 376-5357 (646) 376-5358 (804) 282-7385 (804) 282-4506

ENERGY Exploration & Production

Michael J. McAllister Tim Rezvan, CFA Ryan Mueller Mng. Dir. Analyst Associate (212) 338-4783 (212) 338-4736 (212) 338-4732

CONSTRUCTION MATERIALS & DIVERSIFIED INDUSTRIALS

Todd Vencil, CFA Kevin Bennett, CFA

Oilfield Services & Equipment

Stephen D. Gengaro Grant Fox Mng. Dir. Associate (646) 376-5331 (212) 338-4723

HEALTHCARE

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

FINANCIAL SERVICES Asset Management

Jason Weyeneth, CFA Charles Warren SVP, Sr. Analyst Analyst (212) 763-8293 (646) 376-5309

TECHNOLOGY Data Networking and Storage

Alex Kurtz Amelia Harris Mng. Dir Analyst (415) 402-6015 (415) 402-6018

Banks & Thrifts

Matthew Kelley Mike I. Shafir Matthew Breese Brett Rabatin, CFA Kenneth James Nathan Race Peyton Green Zachary Wollam Todd L. Hagerman Robert Greene Mng. Dir. SVP, Sr. Analyst Analyst SVP, Sr. Analyst Analyst Associate Mng. Dir. Analyst Mng. Dir. Analyst (207) 699-5800 (212) 763-8239 (207) 699-5800 (877) 457-8625 (615) 760-1474 (615) 760-1477 (877) 492-2663 (615) 760-1468 (212) 338-4744 (212) 763-8296

Financial Technology
Greg Smith Jennifer Dugan Mng. Dir Analyst (818) 615-2029 (415) 402-6051

Hardware, Mobile Devices, IT Supply Chain

Shaw Wu SVP, Sr. Analyst (415) 362-7431

LED Supply Chain

Andrew Huang John Shen Mng. Dir. Associate Mng. Dir. Analyst (415) 362-6143 (415) 402-6052 (312) 525-8431 (312) 525-8430

Life Insurance
John M. Nadel Alex Levine Mng. Dir. Associate (212) 338-4717 (212) 338-4748

Semiconductors
Vijay Rakesh Mark Kelley

TRANSPORTATION, SERVICES & EQUIPMENT

Jeffrey A. Kauffman Sal Vitale Kanchana Pinnapureddy Mng. Dir. VP, Analyst Associate (212) 338-4765 (212) 338-4766 (212) 338-4767

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