George Engelke Remembered for Strong Will, Bold Streak

George Engelke is being remembered by his peers as a larger-than-life executive who took Astoria Financial in Lake Success, N.Y., from a small, sleepy mutual to one of the biggest thrifts in New York.

Engelke, 76, died on Sunday. While he completely retired from Astoria two years ago, Engelke left a lasting mark on the institution — and the greater New York community — during his 22 years at its helm. And he was remembered for freely speaking his mind while maintaining good relations with those around him.

The long-time banker "was a big guy with a strong, strong personality," Federal Home Loan Bank of New York Chairman Michael Horn said in an interview Wednesday. "He had sincere feelings about issues, and he let everyone know them, but you couldn't help but like him. … I never met anyone who had anything bad to say about George."

Engelke didn't just preside over institutions like the Federal Home Loan Bank of New York, which he chaired from 2005 to 2007, and Astoria — he dominated them. Still, the word that probably best describes him and the legacy he leaves behind is transformative.

When Engelke joined what was then Astoria Federal Savings and Loan Association in 1971, it had less than $400 million in assets. Now the publicly traded company has nearly $16 billion in assets and 87 branches.

Astoria traces its roots back to 1888, when it opened as Central Permanent Building and Loan Association, but it was Engelke who engineered what were arguably the two most important events in the company's history: Its 1993 conversion from mutual to stock ownership and the 1998 purchase of Long Island Savings Bank.

"Astoria was very associated with his leadership," said Kip Weissman, a partner at Washington, D.C. law firm Luse, Gorman, Pomerenk and Schick.

Astoria clung to an especially pure version of the thrift model long after many competitors had either sold themselves or altered their business plans to look more like commercial banks.

Engelke, in 2004, called Astoria's strategy "simple and straightforward — to maintain a strict focus on our core competencies: retail banking, superior quality mortgage portfolio lending and operating efficiently." Six years later, during his last full year as president and CEO, 91% of the $3.2 billion in loans Astoria originated were classed as residential.

An unwavering dedication to residential lending earned him some criticism from analysts and investors who sought more yield than a plain-vanilla thrift balance sheet could generate, Weissman said. But that conservatism helped Astoria weather the 2008 financial crisis relatively unscathed.

A total of 389 banks, including many big thrifts, failed between 2009 and 2011, but Astoria posted a profit every quarter. During Engelke's time as CEO, from 1989 until his 2011 retirement, Astoria never reported an annual loss. (He retired as chairman a year later.

Astoria never missed a dividend payment, either.

Astoria's performance during the crisis years "is a tribute to him and the business model," Weissman said. "The way they underwrote those loans was very traditional."

Astoria has been acting more like a commercial bank in recent years, changing its main subsidiary's name in June to Astoria Bank from Astoria Federal Savings.

John A. Kanas, who competed against Astoria for nearly two decades while he was president and chief executive at North Fork Bancorp. in Melville, N.Y., called Engelke a disciplined lender who "stayed within the framework he thought his bank understood best."

Engelke "was a great competitor and a distinguished banker for many years on Long Island," Kanas said. "The industry is going to sorely miss him."

"For multiple decades, I have worked with George Engelke, who was an influential member of the banking industry," Joseph Ficalora, chief executive of New York Community Bancorp, added. "He was always well-regarded and informed on matters of relevance to the industry."

Engelke, a 1960 graduate of Lehigh University in Bethlehem, Pa., was trained as a certified public accountant. Before joining Astoria as a vice president and treasurer, he worked at Peat, Marwick, Mitchell & Co., a predecessor to KMPG Peat Marwick.

Astoria's financial conservatism masked Engelke's boldness, said Kanas, who sold North Fork to Capital One Financial, and is now chairman, president and CEO of BankUnited. That bold streak was evident when Astoria bought Long Island Savings.

An article in the New York Times derided the deal's $1.8 billion valuation as "a rich price that provides yet another barometer of how eager banks of all sizes are to merge." Still, the acquisition doubled Astoria's asset size and kicked off a run of seven straight years where annual net income topped $200 million. Astoria earned nearly $1.7 billion over that period.

Kanas, who also courted Long Island Savings, agreed that the acquisition was an "aggressive" move, though he added that it turned out well for Astoria.

It came as little surprise when, in 2007, Astoria abolished its mandatory retirement age of 70, allowing Engelke to remain on the job. When he stepped down as chairman five years later, Astoria was the nation's fifth-biggest publicly traded thrift.

Engelke's successor, Monte Redman, was unavailable for comment, though Astoria issued a press release touting his efforts getting the company to where it is today. "His vision made it possible to grow from a mutually owned thrift into a premier community bank on Long Island," the release said.

Engelke and his wife, Sandra, were longtime residents of Garden City, N.Y. Astoria has a branch there and Engelke made sure the bank did its part to support the local community.

Astoria has sponsored the Garden City's annual Tree Lighting and Holiday Festival for two decades. "That all began with George," said Althea Robinson, executive director for the Garden City Chamber of Commerce.