Edgar Filing: STERLING BANCORP

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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

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FORM 10-K
Annual Report Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934

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For the fiscal year ended December 31, 2002 Commission File No. 1-5273-1

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STERLING BANCORP
(Exact name of registrant as specified in its charter)

NEW YORK 13-2565216
(State or other jurisdiction of (I.R.S. employer identification No.)
incorporation or organization)

650 FIFTH AVENUE, NEW YORK, N.Y. 10019-6108
(Address of principal executive offices) (Zip Code)

(212) 757-3300
(Registrant's telephone number, including area code)

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SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:

NAME OF EACH EXCHANGE
TITLE OF EACH CLASS ON WHICH REGISTERED
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Common Shares, $1 par value per share,
and attached Preferred Stock Purchase Rights New York Stock Exchange
Cumulative Trust Preferred
Securities 8.375% (Liquidation Amount
$10 per Preferred Security) of Sterling
Bancorp Trust I and Guarantee of Sterling
Bancorp with respect thereto New York Stock Exchange

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SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
None

Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes |X| No | |

Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K (Section 229.405 of this chapter) is not contained herein,
and will not be contained, to the best of Registrant's knowledge, in definitive
proxy or information statements incorporated by reference in Part III of this
Form 10-K or any amendment to this Form 10-K. | |

On March 5, 2003, the aggregate market value of the voting stock held by
non-affiliates of the Registrant was $273,136,477.

Indicate the number of shares outstanding of each of the Registrant's
classes of common stock, as of the latest practicable date:

THE REGISTRANT HAS ONE CLASS OF COMMON STOCK OF WHICH 11,848,460 SHARES
WERE OUTSTANDING AT MARCH 5, 2003.

DOCUMENTS INCORPORATED BY REFERENCE

(1) Specified portions of Sterling Bancorp's Annual Report to security
holders for the fiscal year ended December 31, 2002 are incorporated
by reference in Parts I and II.

(2) Specified portions of the Sterling Bancorp Proxy Statement dated
March 10, 2003 are incorporated by reference in Part III.

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STERLING BANCORP

FORM 10-K

TABLE OF CONTENTS

PAGE
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PART I

Item 1. BUSINESS ...................................................... I-1

Item 2. PROPERTIES .................................................... I-13

Item 3. LEGAL PROCEEDINGS ............................................. I-13

Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY
HOLDERS .................................................. I-13

PART II

Item 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND
RELATED STOCKHOLDER MATTERS .............................. II-1

Item 6. SELECTED FINANCIAL DATA ....................................... II-1

Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS ...................... II-1

Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES
ABOUT MARKET RISK ........................................ II-1

Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA ................... II-2

Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE ..................... II-2

PART III

Item 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE
REGISTRANT ............................................... III-1

Item 11. EXECUTIVE COMPENSATION ........................................ III-1

Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT .................................... III-1

Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS ................ III-2

Item 14 CONTROLS AND PROCEDURES ....................................... III-2

PART IV

Item 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES,
AND REPORTS ON FORM 8-K .................................. IV-1

SIGNATURES

Exhibits Submitted in a Separate Volume.

PART I

ITEM 1. BUSINESS

GENERAL

Sterling Bancorp ("the parent company" or "the Registrant") is a bank holding
company and a financial holding company as defined by the Bank Holding Company
Act of 1956 (the "BHCA"), as amended, which was organized in 1966. Throughout
the report, the terms "the Company" or "Sterling" refer to Sterling Bancorp and
its subsidiaries. Sterling provides a full range of financial products and
services, including business and consumer loans, commercial and residential
mortgage lending and brokerage, asset-based financing, factoring/accounts
receivable management services, trade financing, equipment leasing, deposit
services, trust and estate administration and investment management services.
The Company has operations in the metropolitan New York area, North Carolina and
many mid-Atlantic states, and conducts business throughout the United States.
The parent company owns all of the outstanding shares of Sterling National Bank
("the bank") - its principal subsidiary, and all of the outstanding shares of
Sterling Banking Corporation and Sterling Financial Services Company, Inc.
("finance subsidiaries") and Sterling Bancorp Trust I ("trust"). Sterling
National Mortgage Company, Inc. ("SNMC"), Sterling National Servicing, Inc.
("SNS-Virginia"), Sterling Factors Corporation ("Factors"), Sterling Trade
Services, Inc. ("Trade Services"), and Sterling Holding Company of Virginia,
Inc. are wholly owned subsidiaries of the bank. Until 1998, Factors was a
finance subsidiary of the Registrant. Sterling Trade Services, Inc. was formed
on April 23, 2001 and owns all of the outstanding common shares of Sterling
National Asia Limited, Hong Kong, which was also formed on that date. Sterling
Holding Company of Virginia, Inc. was formed as of December 21, 1998 and owns
all of the outstanding common shares of Sterling Real Estate Holding Company,
Inc., which was formed as of March 1, 1997. Sterling Bancorp Trust I was formed
as of February 4, 2002. Segment information appearing in Note 22 beginning on
page 41 of the Company's Annual Report to security holders for the fiscal year
ended December 31, 2002 ("the 2002 Annual Report") is incorporated by reference
herein.

Our Internet address is www.sterlingbancorp.com and the investor relations
section of our website is located at www.sterlingbancorp.com/ir/investor.cfm.
We make available free of charge, on or through the investor relations section
of our website, annual reports on Form 10-K, quarterly reports on Form 10-Q and
current reports on Form 8-K and amendments to those reports filed or furnished
pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 as
soon as reasonably practicable after we electronically file such material with,
or furnish it to, the Securities and Exchange Commission.

GOVERNMENT MONETARY POLICY

The Company is affected by the credit policies of monetary authorities,
including the Board of Governors of the Federal Reserve System. An important
element of the Federal Reserve System is to regulate the national supply of bank
credit. Among the instruments of monetary policy used by the Federal Reserve are
open market operations in U.S. Government securities, changes in the discount
rate, reserve requirements on member bank deposits, and funds availability
regulations. The monetary policies of the Federal Reserve have in the past had a
significant effect on operations of financial institutions, including the bank,
and will continue to do so in the future. Changing conditions in the national
economy and in the money markets make it difficult to predict future changes in
interest rates, deposit levels, loan demand or their effects on the business and
earnings of the Company. Foreign activities of the Company are not considered to
be material.

I-1

BUSINESS OPERATIONS

THE BANK

Sterling National Bank was organized in 1929 under the National Bank Act and
commenced operations in New York City. The bank maintains eight offices in New
York, seven offices in New York city (four branches and an International Banking
Facility in Manhattan and two branches in Queens) and one branch in Nassau
County in Great Neck, New York. The executive office is located at 650 Fifth
Avenue, New York, New York.

The bank provides a full range of banking and financial services products.
These products and services include commercial lending, asset-based financing,
factoring/accounts receivable management, equipment leasing , commercial and
residential mortgage lending and brokerage, international trade financing,
deposit services, trust estate administration, investment management and
investment services. Business lending, depository and related financial services
are furnished to a wide range of customers in diverse industries, including
commercial, industrial and financial companies, and government and non-profit
entities.

Commercial Lending, Asset-Based Financing and Factoring/Accounts
Receivable Management. The bank provides loans to small and medium sized
businesses. The businesses are diversified across industries, and the loans
generally range in size from $250,000 to $10 million. Business loans can be
tailored to meet customers' specific long- and short-term needs, and include
secured and unsecured lines of credit, business installment loans, business
lines of credit, and debtor-in-possession financing. Our loans are often
collateralized by assets, such as accounts receivable, inventory, marketable
securities, other liquid collateral, equipment and other assets. Through its
factoring subsidiary, the bank provides accounts receivable management services.
Factors purchases clients' accounts receivable, assumes credit risk on approved
orders and handles credit, collection and bookkeeping. Income for these services
is derived from commission charges for receivables serviced and interest charged
on advances to the client. For these services, Factors receives factoring
commissions paid by the clients plus interest charged on advances. The accounts
receivable factored are for clients primarily engaged in the apparel and textile
industries. As of December 31, 2002, the outstanding loan balance for commercial
and industrial lending was $459.1 million, representing approximately 57% of the
bank's total loan portfolio.

Equipment Leasing. The bank offers equipment leasing services in the New
York metropolitan area and across the United States through direct leasing
programs, third party sources and vendor programs. The bank finances small and
medium-sized equipment leases with an average term of 24 to 30 months. At
December 31, 2002, the outstanding loan balance for equipment leases was
approximately $128.7 million, and equipment leases comprised approximately 16%
of the bank's total loan portfolio.

Residential and Commercial Mortgages. The bank's real estate loan
portfolio consists of real estate loans on one-to-four family residential
properties and commercial properties. The residential mortgage banking and
brokerage business is conducted through SNMC offices located principally in
New York, North Carolina and many mid-Atlantic states. The mortgage company
originates conforming residential mortgage loans throughout the tri-state
metropolitan area, as well as in Virginia and other mid-Atlantic states, for
resale, and non-conforming residential mortgage loans, for its own portfolio
and for resale. Commercial real estate financing is offered on
income-producing, investor properties and owner-occupied properties,
professional co-ops

I-2

and condos through our real estate lending department. At December 31, 2002, the
outstanding loan balance for real estate mortgage loans was $185.4 million,
representing approximately 23% of the bank's total loans outstanding.

International Trade Finance. Through its international division,
International Banking Facility and Hong Kong trade services subsidiary, the bank
offers financial services to its customers and correspondents in the world's
major financial centers. These services consist of financing import and export
transactions, issuance of letters of credit and creation of banker's
acceptances. In addition to its direct worldwide correspondent banking
relationships, active bank account relationships are maintained with leading
foreign banking institutions in major financial centers.

Trust Services. The bank's trust department provides a variety of
fiduciary, investment management, custody and advisory and corporate agency
services to individuals, corporations and foundations. The bank acts as trustee
for pension, profit-sharing, 401(k) and other employee benefit plans and
personal trusts and estates. For corporations, the bank acts as trustee,
transfer agent, registrar and in other corporate agency capacities.

There are no industry concentrations exceeding 10% of gross loans, in the
commercial and industrial loan portfolio. Approximately 68% of the bank's loans
are to borrowers located in the metropolitan New York area. The bank has no
foreign loans.

The composition of income from the operations of the bank and its
subsidiaries for the years ended: [1] December 31, 2002 included interest and
fees on commercial and other loans (45%), interest and dividends on investment
securities (31%) and other (24%); [2] December 31, 2001 included interest and
fees on commercial and other loans (53%), interest and dividends on investment
securities (27%), and other (20%); [3] December 31, 2000 included interest and
fees on commercial and other loans (54%), interest and dividends on investment
securities (27%), and other (19%).

At December 31, 2002, the bank and its subsidiaries had 428 employees,
consisting of 152 officers and 276 supervisory and clerical employees. The bank
considers its relations with its employees to be satisfactory.

PARENT COMPANY AND FINANCE SUBSIDIARIES

The parent company, through its finance subsidiary - Sterling Financial Services
Company ("Sterling Financial"), makes loans that are secured by personal
property, accounts receivable or other collateral; occasionally unsecured
advances are provided to its customers.

Dealer Receivable Financing. Through Sterling Financial, we provide loans
to independent dealers who market products, such as housewares, appliances,
automobiles and educational material to consumers on an installment basis with
repayment terms between 12 and 48 months. We administer these installment
contracts for the dealer by providing billing, payment processing and other
bookkeeping services. We generally lend up to 80% of the value of the borrower's
collateral. More than 65% of the payments are received electronically.

I-3

The composition of income (excluding equity in undistributed net income of
the bank) of the parent company and its finance subsidiaries for the years
ended: [1] December 31, 2002 included interest and fees on loans (24%),
dividends, interest and service fees (74%) and other (2%); [2] December 31, 2001
included interest and fees on loans (32%), dividends, interest and service fees
(66%), and other (2%); [3] December 31, 2000 included interest and fees on loans
(42%), dividends, interest and service fees (55%), and other (3%). As of January
1, 2001, Sterling Financial became a subsidiary of the parent company. Prior to
that date, Sterling Financial was a division of the parent company.

At December 31, 2002, the parent company and its finance subsidiaries
employed 36 persons consisting of 8 officers with the balance of the employees
performing supervisory and clerical functions. The parent company and its
finance subsidiaries consider employee relations to be satisfactory.

COMPETITION

There is intense competition in all areas in which the Company conducts its
business. The Company competes with banks and other financial institutions,
including savings and loans associations, savings banks, finance companies, and
credit unions. To a limited extent, the company also competes with other
providers of financial services, such as money market mutual funds, brokerage
firms, consumer finance companies and insurance companies. Competition is based
on a number of factors, including prices, interest rates, service, availability
of products, and geographic location.

The Gramm-Leach-Bliley Act of 1999 (the "Gramm-Leach-Bliley Act") has
expanded the permissible activities of a bank holding company. The
Gramm-Leach-Bliley Act allows qualifying bank holding companies to elect to be
treated as financial holding companies. A financial holding company may engage
in activities that are financial in nature or are incidental or complementary to
financial activities. The Gramm-Leach-Bliley Act also eliminated restrictions,
adopted in the 1930's, which prevented banking, insurance and securities firms
from fully entering each other's business. While it is uncertain what the full
impact of the legislation will be over time, it is likely to result in further
consolidation in the financial services industry. In addition, removal of these
restrictions will likely increase the number and type of market entrants
providing banking services and thereby create additional competition. However,
the Company's management cannot currently predict the full impact of the
Gramm-Leach-Bliley Act on the Company. For more information regarding the
Gramm-Leach-Bliley Act see "Supervision and Regulation - Financial Services
Modernization Legislation" below.

SUPERVISION AND REGULATION

GENERAL

The banking industry is highly regulated. Statutory and regulatory controls are
designed primarily for the protection of depositors and the banking system, and
not for the purpose of protecting the shareholders of the parent company. The
following discussion is not intended to be a complete list of all the activities
regulated by the banking laws or of the impact of such laws and regulations on
the bank. It is intended only to briefly summarize some material provisions.

Sterling Bancorp is a bank holding company and a financial holding company
under the BHCA, as amended, and is subject to supervision, examination and
reporting requirements of the Board of Governors of The Federal Reserve System
("Federal Reserve Board").

I-4

As a national bank, the bank is principally subject to supervision,
examination and reporting requirements of the Office of the Comptroller of the
Currency ("OCC"), as well as the Federal Deposit Insurance Corporation ("FDIC").
Insured banks, including the bank, are subject to extensive regulation of many
aspects of their business. These regulations, among other things, relate to: (a)
the nature and amount of loans that may be made by the bank and the rates of
interest that may be charged; (b) types and amounts of other investments; (c)
branching; (d) permissible activities; (e) reserve requirements; and (f)
dealings with officers, directors and affiliates.

Sterling Banking Corporation is subject to supervision and regulation by
the Banking Department of the State of New York.

BANK HOLDING COMPANY REGULATION

The BHCA requires the prior approval of the Federal Reserve Board for the
acquisition by a bank holding company of more than 5% of the voting stock or
substantially all of the assets of any bank or bank holding company. Also,
under the BHCA, bank holding companies are prohibited, with certain exceptions,
from engaging in, or from acquiring more than 5% of the voting stock of any
company engaging in, activities other than: (1) banking or managing or
controlling banks, (2) furnishing services to or performing services for their
subsidiaries, or (3) activities which the Federal Reserve Board has determined
to be so closely related to banking or managing or controlling banks as to be a
proper incident thereto.

As discussed below under "Financial Holding Company Regulation", the BHCA
was amended by the Gramm-Leach- Bliley Act of 1999 to permit a broader range of
activities for bank holding companies that qualify as "financial holding
companies".

FINANCIAL HOLDING COMPANY REGULATION

On November 12, 1999, the President signed the Gramm-Leach-Bliley Act into law.
Effective as of March 11, 2000, the Gramm-Leach-Bliley Act:

- allows bank holding companies, the depository institution subsidiaries of
which meet management, capital and CRA standards, to engage in a
substantially broader range of nonbanking financial activities than was
previously permissible, including: (a) insurance underwriting and agency,
(b) making merchant banking investments in commercial companies, (c)
securities underwriting, dealing and market making, and (d) sponsoring
mutual funds and investment companies;

- allows insurers and other financial services companies to acquire banks;
and

- establishes the overall regulatory structure applicable to bank holding
companies that also engage in insurance and securities operations.

In order for a bank holding company to engage in the broader range of
activities that are permitted by the Gramm-Leach-Bliley Act, (1) all of its
depository subsidiaries must be and remain well-capitalized and well-managed and
have received at least a satisfactory CRA rating and (2) it must file a
declaration with the Board of Governors of the Federal Reserve System that it
elects to be a "financial holding company".

I-5

Requirements and standards to remain "well-capitalized" are discussed
below. To maintain financial holding company status, the bank must have at least
a "satisfactory" rating under the Community Reinvestment Act (the "CRA"). Under
the CRA, during examinations of the bank, the OCC is required to assess the
bank's record of meeting the credit needs of the communities services by the
bank, including low- and moderate-income communities. Banks are given one of
four ratings under the CRA: "outstanding," "satisfactory," "needs to improve" or
"substantial noncompliance." The bank received a rating of outstanding on the
most recent exam completed by the OCC.

Pursuant to an election made under the Gramm-Leach-Bliley Act, the parent
company has been designated as a financial holding company. As a financial
holding company, Sterling Bancorp may conduct, or acquire a company (other than
a U.S. depository institution or foreign bank) engaged in, activities that are
"financial in nature," as well as additional activities that the Federal Reserve
determines (in the case of incidental activities, in conjunction with the
Department of the Treasury) are incidental or complementary to financial
activities, without the prior approval of the Federal Reserve. Under the
Gramm-Leach-Bliley Act, activities that are financial in nature include
insurance, securities underwriting and dealing, merchant banking, and sponsoring
mutual funds and investment companies. Under the new merchant banking authority
added by the Gramm-Leach-Bliley Act, financial holding companies may invest in
companies that engage in activities that are not otherwise permissible
"financial" companies, subject to certain limitations, including that the
financial holding company makes the investment with the intention of limiting
the investment duration and does not manage the company on a day-to-day basis.

Financial holding companies that do not continue to meet all the
requirements for financial holding company status will, depending on which
requirement they fail to meet, lose the ability to undertake new activities or
acquisitions that are financial in nature and may also lose the ability to
continue those activities that are not generally permissible for bank holding
companies. If the parent company ceases to so qualify it would be required to
obtain the prior approval of the Federal Reserve to engage in non-banking
activities or to acquire more than 5% of the voting stock of any company that is
engaged in non-banking activities. With certain exceptions, the Federal Reserve
can only provide prior approval to applications involving activities that it had
previously determined, by regulation or order, are so closely related to banking
as to be properly incident thereto. Such activities are more limited than the
range of activities that are deemed "financial in nature".

PAYMENT OF DIVIDENDS AND TRANSACTIONS WITH AFFILIATES

While the parent company generates income from its own operations, it also
depends for its cash requirements on funds maintained or generated by its
subsidiaries, principally the bank. Such sources have been adequate to meet the
parent company's cash requirements throughout its history.

Various legal restrictions limit the extent to which the bank can fund its
parent company and its nonbank subsidiaries. All national banks are limited in
the payment of dividends without the approval of the Comptroller of the Currency
to an amount not to exceed the net profits (as defined) for that year to date
combined with its retained net profits for the preceding two calendar years.
Under the Federal Deposit Insurance Corporation Improvement Act of 1991
("FDICIA"), a depository institution, such as the bank, may not pay dividends
if payment would cause it to become undercapitalized or if it is already
undercapitalized. The payment of dividends by the parent company and the bank
may also be affected or limited by other factors, such as the requirement to
maintain adequate capital.

I-6

Federal laws strictly limit the ability of banks to engage in transactions
with their affiliates, including their bank holding companies. Such transactions
between a subsidiary bank and its parent company or the nonbank subsidiaries of
the bank holding company are limited to 10 percent of a bank subsidiary's
capital and surplus and, with respect to such parent company and all such
nonbank subsidiaries, to an aggregate of 20 percent of the bank subsidiary's
capital and surplus. Further, loans and extensions of credit generally are
required to be secured by eligible collateral in specified amounts. Federal law
also requires that all transactions between a bank and its affiliates be on
terms as favorable to the bank as transactions with non-affiliates.

Federal law also limits a bank's authority to extend credit to its
directors, executive officers and 10 percent shareholders, as well as to
entities controlled by such persons. Among other things, extensions of credit to
insiders are required to be made on terms that are substantially the same as,
and follow credit underwriting procedures that are not less stringent than,
those prevailing for comparable transactions with unaffiliated persons and that
do not involve more than the normal risk of repayment or present other
unfavorable features and may not exceed certain limitations on the amount of
credit extended to such persons, individually and in the aggregate, which limits
are based, in part, on the amount of the bank's capital.

Banks are subject to prohibitions on certain tying arrangements. A
depository institution is prohibited, subject to some exceptions, from extending
credit to or offering any other service, or fixing or varying the consideration
for such extension of credit or service, on the condition that the customer
obtain some additional service from the institution or its affiliates or not
obtain services of a competitor of the institution.

CAPITAL ADEQUACY

The Company and the bank are subject to risk-based capital regulations. The
purpose of these regulations is to quantitatively measure capital against
risk-weighted assets, including off-balance sheet items. These regulations
define the elements of total capital into Tier 1 and Tier 2 components and
establish minimum ratios of 4% for Tier 1 capital and 8% for Total Capital for
capital adequacy purposes. Supplementing these regulations is a leverage
requirement. This requirement establishes a minimum leverage ratio, (at least 3%
to 5%) which is calculated by dividing Tier 1 capital by adjusted quarterly
average assets (after deducting goodwill).

In addition, the Company and the bank are subject to the provisions of
FDICIA which imposes a number of mandatory supervisory measures and establishes
a system of prompt corrective action to resolve the problems of
undercapitalized institutions. Among other matters, FDICIA establishes five
capital categories of "well capitalized", "adequately capitalized",
"undercapitalized", "significantly undercapitalized", and "critically
undercapitalized". Such classifications are used by regulatory agencies to
determine, in part, a bank's deposit insurance premium, and to consider
applications authorizing institutions to increase their asset size or otherwise
expand business activities or acquire other institutions. Banks that are not
adequately capitalized are subject to significant restrictions and requirements
that increase as capital levels deteriorate and may not accept brokered
deposits.

I-7

Under the provisions of FDICIA, a "well capitalized" institution must
maintain minimum leverage, Tier 1 and Total Capital ratios of 5%, 6% and 10%,
respectively. At December 31, 2002, the capital ratios for the Company and the
bank exceeded the requirements for "well capitalized" institutions.

The table presenting capital and ratios for the Company and the bank as of
December 31, 2002 and 2001 appears in Note 21 beginning on page 40 of the
Company's 2002 Annual Report and is incorporated by reference herein.

EQUITY INVESTMENT IN NON-FINANCIAL COMPANIES

On April 1, 2002, new federal regulations governing the regulatory capital
treatment of equity investments in nonfinancial companies went into effect. The
federal rules require a series of marginal capital charges on covered equity
investments that increase with the level of those investments as a percentage of
the Company's and the bank's Tier 1 capital.

The rules have not had and management does not expect that the rules will
have a material effect on the capital requirements or strategic plans of the
Company and the bank.

BIS GUIDELINES

The U.S. federal bank regulatory agencies' risk-capital guidelines are based
upon the 1988 capital accord of the Basel Committee on Banking Supervision (the
"BIS"). The BIS is a committee of central banks and bank supervisors/regulators
from the major industrialized countries that develops broad policy guidelines
that each country's supervisors can use to determine the supervisory policies
they apply. In January 2001 the BIS released a proposal to replace the 1988
capital accord with a new capital accord that would set capital requirements for
operational risk and refine the existing capital requirements for credit risk
and market risk exposures. Operational risk is defined to mean the risk of
direct or indirect loss resulting from inadequate or failed internal processes,
people and systems or from external events. The 1988 capital accord does not
include separate capital requirements for operational risk. The BIS has stated
that its objective is to finalize a new capital accord in the fourth quarter of
2003 and for member countries to implement the new accord at year end 2006. The
ultimate timing for the new accord, and the specifics of capital assessments
for addressing operational risk, are uncertain. However, the Company expects
that a new capital accord addressing operational risk will eventually be
adopted by the BIS and implemented by the U.S. federal bank regulatory
agencies. The Company cannot determine whether new capital requirements that
may arise out of a new BIS capital accord will increase or decrease minimum
capital requirements applicable to it and its subsidiaries.

SUPPORT OF THE BANK

The Federal Reserve Board has stated that a bank holding company should serve as
a source of financial and managerial strength to its subsidiary banks. As a
result, the Federal Reserve Board may require the parent company to stand ready
to use its resources to provide adequate capital funds to its banking
subsidiaries during periods of financial stress or adversity. This support may
be required at times by the Federal Reserve Board even though not expressly
required by regulation.

I-8

FDIC INSURANCE

Under the FDIC's risk-related insurance assessment system, insured depository
institutions may be required to pay annual assessments to the FDIC being based
on the institution's risk classification. An institution's risk classification
is based on assignment of the institution by the FDIC to one of three capital
groups and to one of three supervisory groups. The three supervisory groups are
Group "A" financially solid institutions with only a few minor weaknesses, Group
"B" institutions with weaknesses which, if uncorrected, could cause substantial
deterioration of the institution and increased risk to the insurance fund and
Group "C" institutions with a substantial probability of loss to the fund absent
effective corrective action.

The three capital categories are well capitalized; adequately capitalized;
and undercapitalized. These three categories are substantially the same as the
prompt corrective action categories previously described, with the
undercapitalized category including institutions that are undercapitalized,
significantly undercapitalized, and critically undercapitalized for prompt
corrective action purposes. A bank's capital and supervisory subgroup is
confidential and may not be disclosed. Assessment rates for deposit insurance
currently range from zero basis points to 27 basis points per $100 of deposits.
Any increase in insurance assessments could have an adverse impact on the
earnings of insured institutions, including the bank. Because of favorable loss
experience and a healthy reserve ratio in the Bank Insurance Fund maintained by
the FDIC, well capitalized and well managed banks, including the bank, have in
recent years paid no premiums for FDIC insurance. In the future, even well
capitalized and well managed banks may be required to pay premiums on deposit
insurance. The amount of any such premiums will depend on the outcome of
legislative and regulatory initiatives as well as BIF loss experience and other
factors.

In addition, the bank is required to make payments for the servicing of
obligations of the Financing Corporation ("FICO") issued in connection with the
resolution of savings and loan associations, so long as such obligations remain
outstanding. The current FICO annual assessment rate is 1.68 cents per $100 of
deposits.

Under the Federal Deposit Insurance Act, insurance of deposits may be
terminated by the FDIC upon a finding that the institution has engaged in unsafe
and unsound practices, is in an unsafe or unsound condition to continue
operations, or has violated any applicable law, regulation, rule, order, or
condition imposed by the FDIC.

In addition, the Federal Deposit Insurance Act provides that a depository
institution insured by the FDIC can be held liable by the FDIC for any loss
incurred or reasonably expected to be incurred in connection with the default of
a commonly controlled FDIC insured depository institution or in connection with
any assistance provided by the FDIC to a commonly controlled institution "in
danger of default" (as defined).

In its resolution of the problems of an insured depository institution in
default or in danger of default, the FDIC is generally required to satisfy its
obligations to insured depositors at the least possible cost to the deposit
insurance fund. In addition, the FDIC may not take any action that would have
the effect of increasing the losses to the deposit insurance fund by protecting
depositors for more than the insured portion of deposits (generally $100,000) or
creditors other than depositors. The Omnibus Budget Reconciliation Act of 1993
provided for a domestic depositor preference upon liquidation or dissolution of
an insured bank.

I-9

SAFETY AND SOUNDNESS STANDARDS

Federal banking agencies promulgate safety and soundness standards relating to,
among other things, internal controls, information systems and internal audit
systems, loan documentation, credit underwriting, interest rate exposure, asset
growth, compensation, fees, and benefits. With respect to internal controls,
information systems and internal audit systems, the standards describe the
functions that adequate internal controls and information systems must be able
to perform, including: (i) monitoring adherence to prescribed policies; (ii)
effective risk management; (iii) timely and accurate financial, operations, and
regulatory reporting; (iv) safeguarding and managing assets; and (v) compliance
with applicable laws and regulations. The standards also include requirements
that: (i) those performing internal audits be qualified and independent; (ii)
internal controls and information systems be tested and reviewed; (iii)
corrective actions be adequately documented; and (iv) that results of an audit
be made available for review of management actions.

USA PATRIOT ACT

On October 26, 2001, the President signed into law comprehensive anti-terrorism
legislation known as the USA Patriot Act of 2001. Title III of the USA Patriot
Act requires financial institutions, including the bank, to help prevent, detect
and prosecute international money laundering and the financing of terrorism. The
principal provisions of Title III of the USA Patriot Act require that regulated
financial institutions, including the bank: (i) establish an anti-money
laundering program that includes training and audit components; (ii) comply with
regulations regarding the verification of the identity of any person seeking to
open an account; (iii) take additional required precautions with non-U.S. owned
accounts; and (iv) in certain circumstances, prohibit the maintenance of
correspondent accounts with foreign banks that do not have a physical presence
in the U.S. The USA Patriot Act also expanded the conditions under which funds
in a U.S. interbank account may be subject to forfeiture and increased penalties
for violation of anti-money laundering regulations. Failure of a financial
institution to comply with the USA Patriot Act's requirements could have serious
legal and reputational consequences for the institution. The bank has adopted
policies, procedures and controls to address compliance with the requirements of
the USA Patriot Act under the existing regulations and will continue to revise
and update its policies, procedures and controls to reflect changes required by
the USA Patriot Act and implementing regulations.

SELECTED CONSOLIDATED STATISTICAL INFORMATION

I. Distribution of Assets, Liabilities and Shareholders' Equity; Interest
Rates and Interest Differential.

The information appearing on pages 62, 63, and 64 of the 2002 Annual Report is
incorporated by reference herein.

I-10

II. Investment Portfolio

A summary of the Company's investment securities by type with related carrying
values at the end of each of the most recent three fiscal years appears on page
52 of the 2002 Annual Report and is incorporated herein by reference.
Information regarding book values and range of maturities by type of security
and weighted average yields for totals of each category is presented in the 2002
Annual Report on pages 26 and 27 and is incorporated by reference herein. The
average yield by maturity range is not available.

III. Loan Portfolio

A table setting forth the composition of the Company's loan portfolio, net of
unearned discounts, at the end of each of the most recent five fiscal years
appears on page 53 of the 2002 Annual Report and is incorporated herein by
reference.

A table setting forth the maturities and sensitivity to changes in
interest rates of the Company's commercial and industrial loans at December 31,
2002 appears on page 53 of the 2002 Annual Report and is incorporated herein by
reference.

It is the policy of the Company to consider all customer requests for
extensions of original maturity dates (rollovers), whether in whole or in part,
as though each was an application for a new loan subject to standard approval
criteria, including credit evaluation. The information appearing in the 2002
Annual Report beginning on page 52 under the caption "Loan Portfolio", page 28
in Note 6 and on page 23 in Note 1 under the caption "Loans" is incorporated by
reference herein.

A table setting forth the aggregate amount of domestic non-accrual, past
due and restructured loans of the Company at the end of each of the most recent
five fiscal years appears on page 54 of the 2002 Annual Report and is
incorporated herein by reference; there were no foreign loans accounted for on a
nonaccrual basis and there were no troubled debt restructurings for any types of
loans. Loans contractually past due 90 days or more as to principal or interest
and still accruing are loans which are both well-secured or guaranteed by
financially responsible third parties and are in the process of collection.

IV. Summary of Loan Loss Experience

The information appearing in the 2002 Annual Report beginning on page 28 in Note
7 and beginning on page 53 under the caption "Asset Quality" is incorporated by
reference herein. A table setting forth certain information with respect to the
Company's loan loss experience for each of the most recent five fiscal years
appears on page 55 of the 2002 Annual Report and is incorporated herein by
reference.

The Company considers its allowance for loan losses to be adequate based
upon the size and risk characteristics of the outstanding loan portfolio at
December 31, 2002. Net losses within the loan portfolio are not, however,
statistically predictable and are subject to various external factors that are
beyond the control of the Company. Consequently, changes in conditions in the
next twelve months could result in future provisions for loan losses varying
from the level taken in 2002.

I-11

To comply with a regulatory requirement to provide an allocation of the
allowance for possible loan losses, a table presenting the Company's allocation
of the allowance appears on page 55 of the 2002 Annual Report and is
incorporated herein by reference. This allocation is based on estimates by
management that may vary based on management's evaluation of the risk
characteristics of the loan portfolio. The information appearing in the 2002
Annual Report beginning on page 53 under the caption "Asset Quality" is
incorporated by reference herein. The amount allocated to a particular loan
category may not necessarily be indicative of actual future charge-offs in a
loan category.

V. Deposits

Average deposits and average rates paid for each of the most recent three years
is presented in the 2002 Annual Report on page 62 and is incorporated by
reference herein.

Outstanding time certificates of deposit issued from domestic offices in
amounts of $100,000 or more and interest expense on domestic and foreign
deposits are presented in the 2002 Annual Report on page 29 in Note 8 and is
incorporated by reference herein.

The table providing selected information with respect to the Company's
deposits for each of the most recent three fiscal years appears on page 56 of
the Company's 2002 Annual Report and is incorporated by reference herein.

Interest expense for the most recent three fiscal years is presented in
Note 8 on page 29 of the 2002 Annual Report and is incorporated by reference
herein.

VI. Return on Assets and Equity

The Company's returns on average total assets and average shareholders' equity,
dividend payout ratio and average shareholders' equity to average total assets
for each of the most recent three years is presented in the 2002 Annual Report
on page 49 under the caption "Selected Financial Data" and is incorporated by
reference herein.

VII. Short-Term Borrowings

Balance and rate data for significant categories of the Company's Short-Term
Borrowings, for each of the most recent three years is presented in the 2002
Annual Report on page 30 in Note 9 and is incorporated by reference herein.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

Certain statements contained herein, including but not limited to, statements
concerning future results of operations or financial position, borrowing
capacity and future liquidity, future investment results, future credit
exposure, future loan losses and plans and objectives for future operations, and
other statements contained herein regarding matters that are not historical
facts, are "forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. These statements are not historical
facts but instead are subject to numerous assumptions, risks and uncertainties,
and represent only our

I-12

belief regarding future events, many of which, by their nature, are inherently
uncertain and outside our control. Any forward-looking statements we may make
speak only as of the date on which such statements are made. It is possible that
our actual results and financial position may differ, possibly materially, from
the anticipated results and financial condition indicated in or implied by these
forward-looking statements.

Factors that could cause our actual results to differ, possibly
materially, from those in the forward-looking statements include, but are not
limited to, the following: inflation, interest rates, market and monetary
fluctuations; geopolitical developments including acts of war and terrorism and
their impact on economic conditions; the effects of, and changes in, trade,
monetary and fiscal policies and laws, including interest rate policies of the
Federal Reserve Board; changes, particularly declines, in general economic
conditions and in the local economies in which the Company operates; the
financial condition of the Company's borrowers; competitive pressures on loan
and deposit pricing and demand; changes in technology and their impact on the
marketing of new products and services and the acceptance of these products and
services by new and existing customers; the willingness of customers to
substitute competitors' products and services for the Company's products and
services; the impact of changes in financial services' laws and regulations
(including laws concerning taxes, banking, securities and insurance); changes in
accounting principles, policies and guidelines; the success of the Company at
managing the risks involved in the foregoing as well as other risks and
uncertainties detailed from time to time in press releases and other public
filings. The foregoing list of important factors is not exclusive, and we will
not update any forward-looking statement, whether written or oral, that may
be made from time to time.

ITEM 2. PROPERTIES

The principal offices of the Company occupy one floor at 650 Fifth Avenue, New
York, N.Y. consisting of approximately 14,400 square feet. The lease for these
premises expires April 30, 2016. Rental commitments to the expiration date
approximate $11,677,000.

The bank also maintains operating leases for five branch offices, the
International Banking Facility, an Operations Center, and additional office
space in New York City, Nassau and Suffolk counties (New York), in Mercer County
(New Jersey), in Charlotte (North Carolina) and in Richmond (Virginia) with an
aggregate of approximately 111,600 square feet. The annual office rental
commitments for these premises approximates $16,402,000. The leases have
expiration dates ranging from 2003 through 2016 with varying renewal options.
The bank owns free and clear (not subject to a mortgage) a building in which it
maintains a branch located in Forest Hills, Queens.

ITEM 3. LEGAL PROCEEDINGS

Neither Registrant nor any of its subsidiaries is party to any material legal
proceedings.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

No matter was submitted to a vote of security holders in the fourth quarter of
the fiscal year covered by this report.

I-13

EXECUTIVE OFFICERS OF THE REGISTRANT

This information is included pursuant to Instruction 3 to Item 401 (b) of
Regulation S-K:

Held
Executive
Office
Name of Executive Title Age Since
----------------- ----- --- ---------

Louis J. Cappelli Chairman of the Board and
Chief Executive Officer,
Director 72 1967

John C. Millman President, Director 60 1986

Jerrold Gilbert Executive Vice President 66 1974
and General Counsel

John W. Tietjen Executive Vice President,
Treasurer
and Chief Financial Officer 58 1989

John A. Aloisio Senior Vice President 60 1992

Howard M. Applebaum Senior Vice President 44 2002

All executive officers are elected annually by the Board of Directors and serve
at the pleasure of the Board. There are no arrangements or understandings
between any of the foregoing officers and any other person or persons pursuant
to which he was selected as an executive officer.

I-14

PART II

ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS

The information appearing on page 60 of the 2002 Annual Report under the caption
"MARKET FOR THE COMPANY'S COMMON STOCK AND RELATED SECURITY HOLDER MATTERS" is
incorporated by reference herein. As of March 5 2003, there were 1,763
shareholders of record of our common shares.

During the fiscal years ended December 31, 2001 and 2002, dividends to
holders of our common shares were declared on February 15, 2001, May 17, 2001,
August 16, 2001, November 15, 2001, February 21, 2002, May 16, 2002, August 15,
2002, and November 21, 2002.

ITEM 6. SELECTED FINANCIAL DATA

The information appearing on page 49 of the 2002 Annual Report under the caption
"SELECTED FINANCIAL DATA" is incorporated by reference herein.

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

The information appearing on pages 49 - 64 of the 2002 Annual Report under the
caption "MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS" is incorporated by reference herein. Supplementary data appearing
on page 47 in Note 25 of the 2002 Annual Report is also incorporated by
reference herein.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The information appearing on pages 56 - 59 of the 2002 Annual Report under the
caption "ASSET/LIABILITY MANAGEMENT" is incorporated by reference herein.

II-1

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The Company's consolidated financial statements as of December 31, 2002 and 2001
and for each of the years in the three-year period ended December 31, 2002 and
the statements of condition of Sterling National Bank as of December 31, 2002
and 2001, notes thereto and Independent Auditors' Report thereon appearing on
pages 16 - 48 of the 2002 Annual Report are incorporated by reference herein.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE

None.

II-2

PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

Information regarding executive officers required by Item 401 of Regulation S-K
is furnished in a separate disclosure at the end of Part I of this report since
the registrant did not furnish such information in its definitive proxy
statement prepared in accordance with Schedule 14A. The information beginning on
page 1 of the Sterling Bancorp Proxy Statement dated March 10, 2003 under the
caption "ELECTION OF DIRECTORS", beginning on page 11 of the same proxy
statement under the caption "Security Ownership of Directors and Executive
Officers and Certain Beneficial Owners" and beginning on page 13 of the same
proxy statement under the caption "Section 16(a) Beneficial Ownership Reporting
Compliance" are incorporated by reference herein.

ITEM 11. EXECUTIVE COMPENSATION

The information beginning on page 3 of the Sterling Bancorp Proxy Statement
dated March 10, 2003 under the caption "Executive Compensation and Related
Matters" and on page 11 of the same Proxy Statement under the caption
"Transactions with the Company and Other Matters" are incorporated by reference
herein.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The information beginning on page 11 of the Sterling Bancorp Proxy Statement
dated March 10, 2003 under the caption "Security Ownership of Directors and
Executive Officers and Certain Beneficial Owners" is incorporated by reference
herein.

The information appearing in Notes 15 and 16 on pages 32-35 of the 2002
Annual Report under the captions "Stock Incentive Plan" and "Employee Stock
Ownership Plan," respectively, is incorporated by reference herein.

III-1

The following table provides the information as of December 31, 2002,
regarding securities issued to all of our employees under our equity
compensation plans that were in effect during fiscal 2002 and other equity
compensation plan information.

Equity Compensation Plan Information

Number of Securities
remaining available
Number of Securities Weighted for future issuance
to be issued Average under Equity
upon Exercise Exercise Price of Compensation Plans
of Outstanding Options, Outstanding Options, (excluding securities
Warrants and Rights Warrants, and Rights reflected in column (a))
Plan Category (a) (b) (c)
---------------------------------------------------------------------------------------------------------------------------

Equity Compensation Plans approved by 1,511,937 $15.78 186,643
security holders

Equity Compensation Plans not -- -- 23,627(1)
approved by security holders
--------- ------ -------
TOTAL 1,511,937 $15.78 210,270
========= ====== =======

(1) This number of shares includes shares of the Series D preferred stock
issued in 1993 to the Company's Employee Stock Ownership Plan trust, which
shares had not, as of December 31, 2002, been released for allocation
among the plan's participants.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

The information appearing on page 11 of the Sterling Bancorp Proxy Statement
dated March 10, 2003 under the caption "Transactions with the Company and Other
Matters" is incorporated by reference herein.

ITEM 14. CONTROLS AND PROCEDURES

Within the 90-day period prior to the filing of this report, an evaluation was
carried out under the supervision and with the participation of the Company's
management, including our Chief Executive Officer and Chief Financial Officer,
of the effectiveness of the design and operation of our disclosure controls and
procedures (as defined in Rule 13a-14(c) under the Securities Exchange Act of
1934). Based upon that evaluation, the Chief Executive Officer and Chief
Financial Officer concluded that the design and operation of these disclosure
controls and procedures were effective. No significant changes were made in our
internal controls or in other factors that could significantly affect these
controls subsequent to the date of their evaluation.

III-2

PART IV

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

(a) The documents filed as a part of this report are listed below:

1. Financial Statements

Annual Report to security holders for the fiscal year ended December
31, 2002 (This document is filed only to the extent of pages 16 through 64
which are incorporated by reference herein).

2. Financial Statement Schedules

None

3. Exhibits

3(i)(A) Amended and restated Certificate of Incorporation filed
with the State of New York, Department of State, August
14, 1986 (Filed as Exhibit 3.3 to Registrant's Form 10-K
for the fiscal year ended December 31, 1986 and
incorporated by reference herein).

(i)(B) Certificate of Amendment of The Certificate of
Incorporation filed with the State of New York
Department of State, June 13, 1988 (Filed as Exhibit 3.5
to Registrant's Form 10-K for the fiscal year ended
December 31, 1988 and incorporated by reference herein).

(i)(C) Certificate of Amendment of the Certificate of
Incorporation filed with the State of New York
Department of State, March 3, 1989 (Filed as Exhibit A
to the Registrant's Form 8-A dated March 6, 1989 and
incorporated by reference herein).

(i)(D) Certificate of Amendment of The Certificate of
Incorporation filed with the State of New York
Department of State, March 5, 1993 (Filed as Exhibit 4.1
to Registrant's Form 8-K dated March 5, 1993 and
incorporated by reference herein).

(ii)(A) By-Laws as in effect on March 15, 1993 (Filed as Exhibit
3.3 to the Registrant's Form 10-K for the fiscal year
ended December 31, 1992 and incorporated by reference
herein).

(ii)(B) Amendments to By-Laws adopted May 21, 1998 (Filed as
Exhibit 3 to the Registrant's Form 10-Q for the six
months ended June 30, 1998 and incorporated by reference
herein).

4. (a) Pursuant to Regulation S-K, Item 601(b)(4)(iii)(A), no
instrument which defines the rights of holders of
long-term debt of the registrant or any of its
consolidated subsidiaries is filed herewith. Pursuant to
this regulation, the registrant hereby agrees to furnish
a copy of any such instrument to the SEC upon request.

IV-1

10. (i) Employment Agreements, dated as of February 19, 1993
(Filed as Exhibits 3.4(a) and 3.4(b), respectively, to
the Registrant's Form 10-K for the fiscal year ended
December 31, 1992 and incorporated by reference herein).

(ii) Amendments to Employment Agreements dated February 14,
1995 (Filed as Exhibits 3.10(ii)(a) and 3.10(ii)(b),
respectively, to the Registrant's Form 10-K for the
fiscal year ended December 31, 1994 and incorporated by
reference herein).

(iii) Amendments to Employment Agreements dated February 8,
1997 (Filed as Exhibits 3.10(iii)(a) and 3.10(iii)(b),
respectively, to the Registrant's Form 10-K for the
fiscal year ended December 31, 1995 and incorporated by
reference herein).

(iv) Amendments to Employment Agreements dated February 28,
1998 (Filed as Exhibits 3.10(iv)(a) and 3.10(iv)(b),
respectively, to the Registrant's Form 10-K for the
fiscal year ended December 31, 1997 and incorporated by
reference herein).

(v) Amendments to Employment Agreements dated February 19,
1999 (Filed as Exhibits 3.10(v)(a) and 3.10(v)(b),
respectively, to the Registrant's Form 10-K for the
fiscal year ended December 31, 1998 and incorporated by
reference herein).

(vi) Amendments to Employment Agreements dated May 22,
1999(Filed as Exhibits 10(i)(a) and 10(i)(b),
respectively, to the Registrant's Form 10-Q for the six
months ended June 30, 1999 and incorporated by reference
herein).

(vii) Form of Change of Control Severance Agreement entered in
on May 21, 1999 between the Registrant and each of six
executives (Filed as Exhibit 10(ii) to the Registrant's
Form 10-Q for the six months ended June 30, 1999 and
incorporated by reference herein).

(viii) Amendments to Employment Agreements dated March 9, 1999
(Filed as Exhibits 3.10(viii)(a) and 3.10(viii)(b),
respectively, to the Registrant's Form 10-K for the
fiscal year ended December 31, 1998 and incorporated by
reference herein).

(a) For Louis J. Cappelli
(b) For John C. Millman

(ix) Amendments to Employment Agreements dated February 24,
2000 (Filed as Exhibits 3.10(ix)(a) and 3.10(ix)(b),
respectively, to the Registrant's Form 10-K for the
fiscal year ended December 31, 1999 and incorporated by
reference herein).

(x) Amendments to Employment Agreements dated February 26,
2001 (Filed as Exhibits 3.10(x)(a) and 3.10(x)(b),
respectively, to the Registrant's Form 10-K for the
fiscal year ended December 31, 2000 and incorporated by
reference herein).

(xi) Amendments to Employment Agreements dated March 22, 2002
(Filed as Exhibits 10(i)(a) and 10(i)(b), respectively,
to the Registrant's Form 10-Q for the three months ended
March 31, 2002 and incorporated by reference herein).

(xii) Amendment to Form of Change of Control Severance
Agreement dated February 6, 2002 entered into between
the Registrant and each of four executives (Filed as
Exhibit 10(ii) to the Registrant's Form 10-Q for the
three months ended March 31, 2002 and incorporated by
reference herein).

IV-2

10. (xiii) Form of Change of Control Severance Agreement dated
April 3, 2002 entered into between the Registrant and
one executive (Filed as Exhibit 10(ii) to the
Registrant's Form 10-Q for the six months ended June 30,
2002 and incorporated by reference herein).

(xiv) Amendments to Employment Agreements dated February 26,
2003:

(a) For Louis J. Cappelli
(b) For John C. Millman

11. Statement re: Computation of Per Share Earnings.

12. Statement re: Computation of Ratios.

13. Annual Report to security holders, Sterling Bancorp 2002
Annual Report (This document is filed only to the extent
of pages 16 through 64, which are incorporated by
reference herein).

21. Subsidiaries of the Registrant.

23. Consent of KPMG LLP Independent Certified Public
Accountants.

(b) Reports on Form 8-K:

In a report on Form 8-K dated October 10, 2002 and filed on October 11, 2002,
the Company reported, under Item 7. "Financial Statements, Pro Forma Financial
Information and Exhibits", the press release announcing results for the quarter
and nine months ended September 30, 2002.

In a report on Form 8-K dated November 12, 2002 and filed on November 13, 2002,
the Company reported, under Item 9. "Regulation FD Disclosure", the filing by
the Company's Chief Executive Officer and Chief Financial Officer of
Certifications relating to the Company's Form 10-Q for the quarter ended
September 30, 2002 required pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.

In a report on Form 8-K dated November 21, 2002 and filed November 22, 2002, the
Company reported, under Item 9. "Regulation FD Disclosure", (a) the disclosure
of a 20% stock dividend payable on December 9, 2002 to shareholders of record on
December 2, 2002 and (b) the declaration of an increase in its quarterly cash
dividend of $0.01 to $0.19 payable December 31, 2002 to shareholders of record
on December 13, 2002.

IV-3

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, The Registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.

STERLING BANCORP

/s/ Louis J. Cappelli
--------------------------------------------
Louis J. Cappelli, Chairman
(Principal Executive Officer)

March 28, 2003
Date

/s/ John W. Tietjen
--------------------------------------------
John W. Tietjen, Treasurer
(Principal Financial and Accounting Officer)

March 28, 2003
Date

Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the Registrant and
in the capacities and on the dates indicated:

March 28, 2003 /s/ Louis J. Cappelli Director
(Date) ------------------------------ --------
(Signature) (Title)

March 28, 2003 /s/ John C. Millman Director
(Date) ------------------------------ --------
(Signature) (Title)

March 28, 2003 /s/ Henry J. Humphreys Director
(Date) ------------------------------ --------
(Signature) (Title)

March 28, 2003 /s/ Walter Feldesman Director
(Date) ------------------------------ --------
(Signature) (Title)

March 28, 2003 /s/ Robert Abrams Director
(Date) ------------------------------ --------
(Signature) (Title)

CERTIFICATIONS

I, Louis J. Cappelli, certify that:

1. I have reviewed this annual report on Form 10-K of Sterling Bancorp (the
"Company");

2. Based on my knowledge, this annual report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to
make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by
this annual report;

3. Based on my knowledge, the financial statements, and other financial
information included in this annual report, fairly present in all material
respects the financial condition, results of operation and cash flows of
the Company as of, and for, the periods presented in this annual report;

4. The Company's other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) for the Company and have:

a) designed such disclosure controls and procedures to ensure
that material information relating to the Company, including
its consolidated subsidiaries, is made known to us by others
within those entities, particularly during the period in which
this annual report is being prepared;

b) evaluated the effectiveness of the Company's disclosure
controls and procedures as of date within 90 days prior to the
filing date of this annual report (the "Evaluation Date"); and

c) presented in this annual report our conclusions about the
effectiveness of the disclosure controls and procedures based
on our evaluation as of the Evaluation Date;

5. The Company's other certifying officer and I have disclosed, based on our
most recent evaluation, to the Company's auditors and the audit committee
of the Company's board of directors (or persons performing the equivalent
functions):

a) all significant deficiencies in the design or operation of
internal controls which could adversely affect the Company's
ability to record, process, summarize and report financial
data and have identified for the Company's auditors any
material weaknesses in internal controls; and

b) any fraud, whether or not material, that involves management
or other employees who have a significant role in the
Company's internal controls; and

6. The Company's other certifying officer and I have indicated in this annual
report whether there were significant changes in internal controls or in
other factors that could significantly affect internal controls subsequent
to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.

Date: 3/28/03

/s/ Louis J. Cappelli
-----------------------------------
Name: Louis J. Cappelli
Title: Chairman and Chief Executive Officer

CERTIFICATIONS

I, John W. Tietjen, certify that:

1. I have reviewed this annual report on Form 10-K of Sterling Bancorp (the
"Company");

b) evaluated the effectiveness of the Company's disclosure
controls and procedures as of date within 90 days prior to the
filing date of this annual report (the "Evaluation Date"); and

c) presented in this annual report our conclusions about the
effectiveness of the disclosure controls and procedures based
on our evaluation as of the Evaluation Date;

b) any fraud, whether or not material, that involves management
or other employees who have a significant role in the
Company's internal controls; and

Date: 3/28/03

/s/ John W. Tietjen
-----------------------------------
Name: John W. Tietjen
Title: Executive Vice President, Treasurer
and Chief Financial Officer

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549

DOCUMENTS FILED

AS A PART

OF THIS REPORT

FORM 10-K

ANNUAL REPORT - 2002

----------

STERLING BANCORP

================================================================================

EXHIBIT INDEX

Exhibit
Number

3.(i)(A) Amended and Restated Certificate of Incorporation filed with the
State of New York, Department of State, August 14, 1986 (Filed as
Exhibit 3.3 to Registrant's Form 10-K for the fiscal year ended
December 31, 1986 and incorporated by reference herein).

(i)(B) Certificate of Amendment of The Certificate of Incorporation filed
with the State of New York Department of State, June 13, 1988 (Filed
as Exhibit 3.5 to Registrant's Form 10-K for the fiscal year ended
December 31, 1988 and incorporated by reference herein).

(i)(C) Certificate of Amendment of the Certificate of Incorporation filed
with the State of New York Department of State, March 3, 1989 (Filed
as Exhibit A to the Registrant's Form 8-A, dated March 6, 1989 and
incorporated by reference herein).

(i)(D) Certificate of Amendment of The Certificate of Incorporation filed
with the State of New York Department of State, March 5, 1993 (Filed
as Exhibit 4.1 to Registrant's Form 8-K dated March 5, 1993 and
incorporated by reference herein).

(ii)(A) By-Laws as in effect on March 15, 1993 (Filed as Exhibit 3.3 to the
Registrant's Form 10-K for the fiscal year ended December 31, 1992
and incorporated by reference herein).

(ii)(B) Amendments to By-Laws adopted May 21, 1998 (Filed as Exhibit 3 to
the Registrant's Form 10-Q for the six months ended June 30, 1998
and incorporated by reference herein).

4. (a) Pursuant to Regulation S-K, Item 601(b)(4)(iii)(A), no instrument
which defines the rights of holders of long-term debt of the
registrant or any of its consolidated subsidiaries is filed
herewith. Pursuant to this regulation, the registrant hereby agrees
to furnish a copy of any such instrument to the SEC upon request.

10. (i) Employment Agreements, dated as of February 19, 1993 (Filed as
Exhibits 3.4(a) and 3.4(b), respectively, to the Registrant's Form
10-K for the fiscal year ended December 31, 1992 and incorporated by
reference herein).

(ii) Amendments to Employment Agreements dated February 14, 1995 (Filed
as Exhibits 3.10(ii)(a) and 3.10(ii)(b), respectively, to the
Registrant's Form 10-K for the fiscal year ended December 31, 1994
and incorporated by reference herein).

10.(iii) Amendments to Employment Agreements dated February 8, 1997 (Filed as
Exhibits 3.10(iii)(a) and 3.10(iii)(b), respectively, to the
Registrant's Form 10-K for the fiscal year ended December 31, 1995
and incorporated by reference herein).

(iv) Amendments to Employment Agreements dated February 28, 1998 (Filed
as Exhibits 3.10(iv)(a) and 3.10(iv)(b), respectively, to the
Registrant's Form 10-K for the fiscal year ended December 31, 1997
and incorporated by reference herein).

(v) Amendments to Employment Agreements dated February 19, 1999 (Filed
as Exhibits 3.10(v)(a) and 3.10(v)(b), respectively, to the
Registrant's Form 10-K for the fiscal year ended December 31, 1998
and incorporated by reference herein).

(vi) Amendments to Employment Agreements dated May 22, 1999 (Filed as
Exhibits 10(i)(a) and 10(i)(b), respectively, to the Registrant's
Form 10-Q for the six months ended June 30, 1999 and incorporated by
reference herein).

(vii) Form of Change of Control Severance Agreement entered in on May 21,
1999 between the Registrant and each of six executives (Filed as
Exhibit 10(ii) to the Registrant's Form 10-Q for the six months
ended June 30, 1999 and incorporated by reference herein).

(viii) Amendments to Employment Agreements dated March 9, 1999 (Filed as
Exhibits 10(viii)(a) and 10(viii)(b), respectively, to the
Registrant's Form 10-K for the fiscal year ended December 31, 1998
and incorporated by reference herein).

(ix) Amendments to Employment Agreements dated February 24, 2000 (Filed
as Exhibits 3.10(ix)(a) and 3.10(ix)(b), respectively, to the
Registrant's Form 10-K for the fiscal year ended December 31, 1999
and incorporated by reference herein).

(x) Amendments to Employment Agreements dated February 26, 2001 (Filed
as Exhibits 3.10(x)(a) and 3.10(x)(b), respectively, to the
Registrant's Form 10-K for the fiscal year ended December 31, 2000
and incorporated by reference herein).

(xi) Amendments to Employment Agreements dated March 22, 2002 (Filed as
Exhibits 10(i)(a) and 10(i)(b), respectively, to the Registrant's
Form 10-Q for the three months ended March 31, 2002 and incorporated
by reference herein).

(xii) Amendment to Form of Change of Control Severance Agreement dated
February 6, 2002 entered into between the Registrant and each of
four executives (Filed as Exhibit 10(ii) to the Registrant's Form
10-Q for the three months ended March 31, 2002 and incorporated by
reference herein).

(xiii) Form of Change of Control Severance Agreement dated April 3, 2002
entered into between the Registrant and one executive (Filed as
Exhibit 10(ii) to the Registrant's Form 10-Q for the six months
ended June 30, 2002 and incorporated by reference herein).

(xiv) Amendments to Employment Agreements dated February 26, 2003:

(a) For Louis J. Cappelli
(b) For John C. Millman

11. Statement re: Computation of Per Share Earnings.

12. Statement re: Computation of Ratios.

13. Annual Report to security holders, Sterling Bancorp 2001 Annual
Report (This document is filed only to the extent of pages 16
through 61, which are incorporated by reference herein).

21. Subsidiaries of the Registrant.

23. Consent of KPMG LLP Independent Certified Public Accountants.