Enterprise Risk M anagement Committee Charter

of
Astoria Financial Corporation
and
Astoria Federal Savings and Loan Association
I.

Purpose

The purpose of the Enterprise Risk Management Committee (the Committee) of the Boards of Directors (the
Boards) of Astoria Financial Corporation (the Corporation) and Astoria Federal Savings and Loan Association (the
Association) is to assist the Boards oversight of (i) strategic and emerging risks that have the potential to impact the
Corporation and the Association (ii) the risk management function of the Corporation and Association and (iii) to take
or use other means to discharge their responsibilities as set forth hereunder and as described in the corporate governance
guidelines approved by the Boards.
II.

M embership, Appointment and Removal

The Committee shall consist of no fewer than four directors, each of whom shall be independent as determined
by the Boards in accordance with the criteria for independence contained in the New York Stock Exchange Listing
Manual and in any other applicable laws, rules and regulations (the Independent Director). One of the Committee
members shall be designated by the Boards to serve as Chairman of the Committee. The Chairman of the Committee
shall preside at all meetings of the Committee. In the absence of the Chairman, and provided a quorum is present, the
remaining members of the Committee may designate from among the Committees membership a Chairman pro tem to
preside at such meeting. Members of the Committee shall be appointed annually by the Boards, or more frequently in
the case of vacancies, and shall serve at the pleasure of the B oards. The members shall serve until their resignation,
retirement, or removal by the Boards or until successors shall be appointed and qualified.
All members of the Committee shall have a working familiarity with basic finance and accounting or related financial
management expertise and at least two members shall have past employment experience in finance and accounting,
requisite professional certification in accounting, or any other comparable experience or background which results in
the individuals financial sophistication, including being or having been a chief executive officer, chief financial officer
or other senior officer with financial oversight responsibilities.
III.

Committee Goals and Responsibilities

The Committee will carry out the following responsibilities in coordination, where appropriate, with the Boards
and other Board committees:
Risk Managem ent:

Monitor all material enterprise risks. In doing so, the Committee recognizes the
responsibilities delegated to other committees by the Boards and understands that other
Board committees may emphasize specific risk monitoring through their respective activities
and that Corporation and Association management is responsible for the day to day
management of risks.

Oversee, on the basis of proposals from management, the creation and subsequent assessment
of a Risk Appetite Statement (RAS) for approval by the B oards in relation to the
management of risk. The RAS will include the definition of the categories of risk including
qualitative, quantitative and tolerance standards in relation to each category. These standards
will be reviewed periodically (and at least annually) to take into account changes in the
internal and external environment as well as reports and findings of the Audit Committee as
they relate to the performance of controls.

May 15, 2013 version

Page -1-

Review the adequacy of the Corporations and Associations resources to perform their risk
management and compliance responsibilities.

Review the scope of work of the enterprise risk management function and planned activities
with respect to the risk management activities of the Corporation and Association.

Review the scope of work of the compliance function and planned activities with respect to
the activities of the Corporation and Association.

Review significant reports from regulatory agencies relating to risk management.

Monitor and oversee the Corporations and Associations responses to such reports.

Review significant reports from regulatory agencies relating to compliance matters.

Monitor and oversee the Corporations and Associations responses to such reports.

Review and approve annually the risk management policy, compliance program and
compliance policies of the Corporation and Association.

Review and approve annually the compliance program and compliance policies of the
Corporation and Association.

Meet with the Chief Risk Officer, Enterprise Risk Officer, Compliance Officer, other
members of management and other Board committees, as needed or advisable, to discuss the
Corporations and Associations corporate risk and compliance management frameworks
and/or related areas.

Review and recommend to the Boards the approval of any major transactions or decisions
affecting either the Corporations or Associations risk profile or exposure.

Monitor the processes for identifying and monitoring significant risks.

Approve and monitor acceptable levels of risk tolerance.

Receive regular reports from members of senior management on areas of material risk to the
Corporation and the Association.

Review various risk management reports at regular intervals during the year. This review
should include, at least annually, an assessment of enterprise-wide risks that have the
potential to impact the Corporation and the Association. In addition, the review should
include discussion with management of significant issues regarding (i) emerging risks that
warrant immediate attention (ii) gaps in risk management capabilities (iii) the status of
improvement initiatives (iv) exceptions versus policy and established limits and (v) changes
in key variables beyond managements control (e.g., interest rates or regulatory requirements)
and their potential effect on earnings, cash flow, capital and/or the business plan.

Reporting Responsibilities:

Prepare, issue, and/or review the reports required under Reports to the Boards below.

Other Responsibilities:
May 15, 2013 version

Page -2-

Perform other activities related to this charter as requested by the Boards.

Institute and oversee special investigations, as advisable or necessary, and receive reports on
litigation and fraud.

Committee Operations
The Committee shall establish its own rules of procedure, which shall be consistent with the Bylaws of the
Corporation and this Charter. Meetings of the Committee shall occur from time to time as called by the Chairman of the
Committee or as requested by the Boards or the Boards Chairman, but not less frequently than four times annually. The
Committee shall meet separately, periodically, with the Chief Risk Officer, with the Enterprise Risk Officer and/or his
staff, with the Compliance Officer and/or her staff and with the Corporations auditor. Except as otherwise provided in
the Bylaws of the Corporation, one-third (1/3) of the members of the Committee shall constitute a quorum and all matters
shall be determined by a majority vote of the members present. The Committee may at any time adjourn to an Executive
Session at which only members of the Committee and invited guests may be present.
The Committee shall utilize such resources, in its capacity as a Committee of the Boards, as the Committee shall
determine to be necessary and proper to (i) compensate any other advisor employed by the Committee including, but not
limited to, independent counsel if determined by the Committee to be necessary to carry out its duties and responsibilities
(ii) pay such administrative expenses as are necessary and appropriate to carry out its duties and responsibilities and (iii)
investigate any issues they deem important. The Committee shall have an open and unrestricted communication channel
with all entity personnel, including internal and external auditors or accountants, consultants and advisors and
independent counsel.
Reports to the Boards
The Committee shall keep written minutes and other relevant records of each meeting, which subject to the
approval by the members of the Committee and, once approved, shall be provided to the Boards for their review and/or
ratification and maintained with the books and records of the Corporation. Said documentation will be compiled by the
Sr. EVP, Secretary and Chief Risk Officer who shall act as Secretary to the Committee. Following each of its meetings,
the Chairman of the Committee shall report to the Boards regarding the activities of the Committee
Annual Performance Evaluation
The Committee shall annually undertake a self-evaluation of the Committee, including its effectiveness and
compliance with this Charter and the Corporations Corporate Governance Guidelines. The Committee shall deliver to
the Boards a report setting forth the results of its evaluation, including any recommended amendments to this Charter
and any recommended changes to the Corporations, Associations or the Boards policies and procedures, which shall
then be discussed with the full Boards and acted upon as appropriate.
Reliance on Others
Nothing in this charter is intended to preclude or impair any protection provided by applicable law for good
faith reliance by members of the Committee on reports or other information provided by others.

May 15, 2013 version

Page -3-