2016 ANNUAL REPORT • FORM 10-K & PROXY STATEMENT REPORT • FORM 10-K & PROXY 2016 ANNUAL

ANNUAL REPORT • FORM 10-K & PROXY STATEMENT 2016 “Maintaining our commitment to continuously improve is essential to our ongoing growth and success.” Dear Fellow Shareholder,

We have so much to be proud of and grateful for at Investors Bancorp as 2016 was another financially strong year. There is no question we continue to make progress as we grow and move forward. We take great pride in being recognized by Forbes Magazine for the 6th consecutive year as one of the “Best Banks Folio Holder in America,”1 and we were the highest rated bank in our geographic market. For 2016, we posted net income of $192.1 million, compared to $181.5 million in 2015 and have delivered an impressive five-year total shareholder return of 182%. Assets grew as well in 2016, to $23.17 billion, an increase of $2.29 billion from December 31, 2015. In total, assets have increased by $12.47 billion over the last five years. We also opened thirteen new branches in our New Jersey and New York footprint during 2016. Our impressive growth was a result of our team’s hard work and commitment. We also recognize that our do not delete or growth is dependent on continuing the build-out of our operational and risk management infrastructure, in particular, our compliance, BSA, AML, information and data security, and credit risk. As risk management continues to be a focus in our industry, we must keep current with the emerging technologies, which include increased information security and protection against cyber risk. Keeping pace with technology requires us to adapt and evolve quickly. Our investment in technology will help facilitate our continued growth by creating more efficient processes that will enable us to meet and exceed customer expectations. We have to meet customers not only where they are today – but also where they used this Page will be in the future. Last year, we unveiled our new website which provides faster, easier navigation and an enhanced online experience with better access to important information. In 2017, we intend to continue our investment in technology to enhance our product offerings, including our mobile banking platforms, business online banking capabilities and digital services. Further developing digital solutions will allow us to improve the customer experience and provide the services the market has come to expect. Maintaining our commitment to continuously improve is essential to our ongoing growth and success. I have said this in the past, and I believe it even more today, we need to grow and change in order to succeed. Every day, in every way, we must strive to be better at what we do. We have changed as an organization. Since our initial public offering in 2005, we have transformed from a wholesale thrift to a retail commercial bank. We have accomplished this by increasing our core deposits

1 Forbes Magazine, January 10, 2017, “America’s Best Banks 2017” investorsbank.com • 3 and loans to meet the needs of our growing consumer and commercial customer base. Net loans increased $1.91 billion to $18.57 billion in 2016 and we originated approximately $5.08 billion in new loans. Additionally, the strength of our cash management and professional banking services has helped us grow our loans to business owners to $2.05 billion over the past five years. Overall deposit growth for 2016 was 8.7% and 10.7% of that growth is attributed to our thirteen new branch “I remain excited for locations. Investors continues to effectively manage its strong the future of Investors. capital position of 13% to enhance shareholder value. Through December 31, 2016 the Company More than ever, I believe has repurchased a total of 62.9 million shares of stock, at an average cost of $11.86 per share, Investors can provide a totaling $746.3 million since our stock repurchase plan was implemented in March 2015. Dividends legacy of significance.” paid to shareholders in 2016 were $0.26 per share. Our strategic plan is to continue to grow as a commercial bank and maintain a diversified loan portfolio. While our loan growth remains impressive, we remain diligent in our underwriting and monitoring of credit risk in both our commercial and residential portfolios. Our overall level of non- performing loans remains low, as compared to national and regional peers. Throughout Investors’ history, mergers and acquisitions have been an integral part of our growth and success. In May 2016 Investors signed a definitive merger agreement with The Bank of Princeton, however, we mutually agreed to terminate that transaction in January 2017. We believe this decision was appropriate given the uncertainty of the timing of regulatory approval. Going forward we will continue to take advantage of prudent opportunities for growth that produce financial results and create value for our shareholders. The execution of our strategic plan and the commitment of our leadership team and employees provide Investors with a strong competitive advantage. As we strive to fulfill our mission of providing high-quality products and services, our employees help us operate responsibly and ethically. Their dedication and hard work enable all of us – clients, stockholders, and our communities – to prosper. We recognize our employees are the Bank’s most important asset. In 2016 we invested in programs and provided resources to help employees develop both professionally and personally. We are committed to the ongoing improvement in everything we do at Investors and will continue to make investing in our employees a high priority. Our employees bring our culture and core values to life in every interaction with customers, colleagues and the communities we serve. Our core values of cooperation, character, community and commitment drive us to make a difference. During 2016 our foundations awarded over $8 million to non-profit organizations. Our philanthropic contributions are just a part of our commitment. Our employees’ support of these organizations is what truly makes the difference. They donate their time, talent and energy to their local communities. They are a reflection and personification of our culture, and they are helping to make Investors Bank significant.

4 • investorsbank.com Investing and enhancing our brand awareness in the markets in which we operate is important to our continued growth. In 2016, Investors was proud to enter into an exciting new partnership with the New Jersey Devils and The Prudential Center. This relationship is much more than a marketing sponsorship. It truly is a partnership between like-minded companies who are committed to giving back to the communities they serve. This relationship raises Investors’ profile in our market. We will continue to leverage opportunities and activities which can open the door for more business relationships in the future. Yes, 2016 was another financially strong year for Investors. However, we are not content tosit back and say we are “successful”. That is not the Investors way. We will continue to execute on our strategic plan and do so by means that encourage, enable and ensure our improvement. We will remain true to our vision, our mission and values, because that is the foundation on which we have built the Company. Although we start 2017 with a challenging economic environment and an unchartered political landscape, I have faith in our strategic plan, our ability to continue its execution, and to do it well. I also have confidence in our employees and their dedication. We will keep moving forward and will do so while remaining true to our roots as a community bank – providing a high level of service with quality financial solutions. We believe that we have an obligation to contribute to the ongoing vitality and prosperity of our customers and the communities we serve. I remain excited for the future of Investors. More than ever, I believe Investors can provide a legacy of significance. On behalf of the Board of Directors, management and staff, thank you for being a shareholder of Investors Bancorp. Your investment is so important. We appreciate your trust, confidence, and the continuing opportunity to serve you.

Sincerely,

Kevin Cummings President and Chief Executive Officer

investorsbank.com • 5 SELECTED FINANCIAL DATA (In thousands, except branch data and percent data) *

2016 2015 2014 Total assets $23,174,675 $20,888,684 $18,773,639 Net loans outstanding 18,608,153 16,668,564 14,894,438 Securities 3,415,989 3,148,920 2,762,403 Deposits 15,280,833 14,063,656 12,172,326 Borrowed funds 4,546,251 3,263,090 2,766,104 Stockholders' equity 3,123,245 3,311,647 3,577,855 Number of full service offices 151 140 132

2016 2015 2014 Net interest income $640,185 $595,084 $541,971 Net income 192,125 181,505 131,721 Return on average assets 0.88% 0.92% 0.76% Return on average equity 6.06% 5.26% 4.71% Interest rate spread 2.83% 2.91% 3.08% Net interest margin 3.04% 3.12% 3.27% Non-performing assets to total assets 0.47% 0.69% 0.81% Average equity to average assets 14.52% 17.41% 16.16%

Total Assets at December 31 (dollars in billions) 2014 18.8 2015 20.9 2016 23.2

Net Loans Outstanding at December 31 (dollars in billions) 2014 14.9 2015 16.7 2016 18.6

Deposits at December 31 (dollars in billions) 2014 12.2 2015 14.1 2016 15.3

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FORM 10-K intr Page Signature Summary 10-K Form Schedules 16. Statement Item Financial and Exhibits 15. Item Services IV. and Part Fees Independence Accountant Director Principal and 14. Transactions Item Related Relationships, Stockholder Certain Related 13. and Item Management and Owners Beneficial Certain of Ownership Security 12. Item Compensation Governance Executive Corporate 11. and Item Officers Executive Directors, 10. Item III. Part Information Disclosure Other Financial 9B. and Item Accounting Procedures on and Accountants Controls with 9A. Disagreements Item and in Changes Data 9. Supplementary Item and Risk Statements Operations Market Financial of About 8. Results Disclosures Item and Qualitative Condition and Financial Quantitative of 7A. Analysis Item and Discussion Management’s 7. Item Data of Financial Purchases Selected Issuer 6. and Item Matters Stockholder Related Equity, Common Registrant’s for Market 5. Item II. Part Disclosures Safety Mine 4. Item Proceedings Legal 3. Item Properties 2. Item Comments Staff Unresolved 1B. Item Factors Risk 1A. Item Business 1. Item I. Part Matters Securities Equity ...... 77 ...... 151 ...... 2 ...... 50 ...... 51 ...... 40 ...... 50 ...... 77 ...... 150 ...... 53 ...... 50 ...... 06ANA EOTO OM10-K FORM ON REPORT ANNUAL 2016 ...... 77 ...... 76 ...... 50 ...... NETR ACR,INC. BANCORP, INVESTORS AL FCONTENTS OF TABLE ...... 78 ...... 78 ...... 76 ...... 77 ...... 76 ...... 78 ...... 76 ...... 56 ...... Page

FORM 10-K ehv oolgto oudt n owr-okn ttmnst elc vnso icmtne fe h date the after circumstances or events reflect to statements forward-looking document. any this update of to obligation no have We without include, and herein by Factors implied Risk or are our 1A. expressed future which Item results of of in future expected following: (many outlined from the factors light are materially limitation, and other differ factors are to in and These statements results conditions statements. uncertainties actual These us forward-looking risks, cause circumstances. current such to could the by subject that under trends, are control) made appropriate and our are historical beyond performance analyses believe future to we of of and factors guarantees references other perception not assumptions as including well its various as phrases, and developments, on experience and based management’s are terms statements similar the Forward-looking and of “potential,” use “would” “plan,” the by Securities “outlook,” identified “will,” the “may,” be of of may “intend,” 21E “should,” meaning assumptions. statements Section “expect,” the These and “project,” “estimate,” Act, Act. within Securities Exchange “could,” “predict,” statements the the “believe,” or or forward-looking “anticipate,” amended, amended, of as as words number 1933, 1934, of of a Act Act contains Securities Exchange the 10-K of Form 27A on Section Report Annual This STATEMENT HARBOR SAFE ACT REFORM LITIGATION SECURITIES PRIVATE h iko neooi lwonta ol desl fetcei ult n onoriginations. loan and quality credit affect adversely would our that in slowdown economic raised an capital of of risk deployment the effective the with • associated performance financial our on results; impact credit financial to future expected changes achieving adverse • with and associated assets difficulties of growth and • diversification continued with associated risks the the in we commencing • than or existing expensive currently whether or agencies, difficult regulatory before more matters be other or may litigation initiatives business • new of consummation anticipate; we or than success expensive or difficult more be • may changes business; our technological affect adversely may changes • regulatory business, or do legislative we which be in areas to • all condition or some financial in locally our or nationally cause either may conditions, economic guidelines general our or of policies • value business; principles, our the affect accounting adversely affect may in values or estate changes real margins or demand interest loan flows, • reduce deposit in may changes non-financial environment from rate • or interest institutions the financial in among changes pressure competitive our beyond in • circumstances increases to be subject may be may there events of non-occurrence • or occurrence and timing the • eodse ovrinofrn;and offering; conversion step second events of non-occurrence or occurrence the quality; delay may or us to anticipate; we adverse than determined longer be may future, anticipate; than favorable less be may industry banking the or markets securities or anticipate; currently estate we real the in conditions or differently; perceived investments; institutions; control; 1

FORM 10-K 2 PART I BUSINESS Investors Bancorp, Inc. (the “Company”) is a Delaware corporation which became the holding company for The Company is subject to regulation as a bank holding company by the Federal Reserve Board. Investors Investors Bank is a New Jersey-chartered savings bank headquartered in Short Hills, New Jersey. Originally The Bank is in the business of attracting deposits from the public through its branch network and borrowing Since the initial public offering in 2005, we have transitioned from a wholesale thrift business to a retail Investors Bank (“the Bank”)Bancorp, in May MHC. 2014, Prior uponoutstanding the to common completion the stock ofproceeds 2014 the in of mutual-to-stock $509.7 conversion, connection million. conversion The Investors of withproceeds second Investors step of Bancorp, its conversion $2.15 was initial MHC billion completedsecond public on held by step May stock selling offering 7, 55% offering 2014. a and inthe The of total issued Company October 1,000,000 of Investors raised Investors shares net 219,580,695 2005, of Bancorp’s Charitable sharesInvestors common which stock of Foundation. Bancorp and raised common a common Concurrent $10.0 net stockMHC) million stock with at cash was owned $10.00 contribution the exchanged to per byinformation completion share for public prior in to 2.55 of stockholders May the 2014 shares (stockholders the has of been other stock revised Company than to offering, reflect common Investors the each 2.55- stock. Bancorp, to- share As one exchangeBancorp a of ratio. neither result owns ofBank. nor the At leases conversion, the any present allBank property, time, and share but uses the instead the Company supportInvestors uses employs staff Bancorp. the as of Investors the premises, officers Bancorp Bankbusiness only may equipment from in hire certain and time the additional to persons future. furniture employees, time. who of as These are appropriate, persons the also to are not the officers separately extent of compensated it the by expands its founded in 1926acquisitions and as internal growth, asavings including bank New and de in novo 1997 Jersey-chartered the branching. charter mutual In was 1992, converted savings to the a charter New and Jersey-chartered was stock loan converted savingsfunds to bank. association, in a the mutual it wholesaleloans, markets has commercial to real grown originatemortgage estate loans through loans and loans, secured to by commercial invest one-majority and to in of industrial four-family securities. which residential (“C&I”) The are realinsurance loans, Bank estate, home contracts. construction originates one-to equity loans multi-family Securities, loans, four- andobligations, home consumer family primarily and loans, equity residential mortgage-backed the lines other securities, ofsubject securities credit to U.S. represented comprehensive and Government 15% regulation cash(“NJDBI”), and of and surrender the examination value consolidated Federal Federal by Deposit lending assets Agency the Insurance(“CFPB”). on at New Corporation life Jersey (“FDIC”) December Department and 31, the of 2016. Consumer Banking Financial The and Protection Insurance Bank Bureau is Our Business Strategy commercial bank. This transition has been primarily accomplished by increasing the amount of our commercial As used insubsidiaries, principally this Investors Bank. FormAnnual Investors Report 10-K, Bancorp, on Inc.’s Form “we,” electronic 10-K,to filings “us” Quarterly these with reports Reports and the filed on or SEC, Formavailable “our” furnished including 10-Q, at pursuant Current the no refer to Reports Sections cost onsoon to 13(a) in Form or the as 8-K Investors 15(d) Investor and of reasonably amendments Relations the Bancorp,Company’s practicable Exchange section SEC Act, Inc. of filings after as are the amended, and the also Company’s are available Company website, made its through www.myinvestorsbank.com, the files SEC’s consolidated as website such at material www.sec.gov. with, or furnishes it to, the SEC. The ITEM 1.

FORM 10-K rwn n iesfigorla otoi ilcniu ob ao ou forbsns taeygoing strategy business loans. our total of of focus 51% major approximately a be were to loans continue 31, commercial will December when portfolio at have 2012, loan portfolio We forward. our loan 31, estate, loans. real our diversifying C&I December commercial of and of to (including 72% Growing million loans approximately compared commercial $608.9 represent asset teams, as that originated in loans) lending fact 2016 we specializing construction the C&I lenders 2016, and by experienced experienced evidenced C&I 31, of of as multi-family, December number team portfolio, ended a loan a year our and hired diversified the industry have healthcare For We the lending. area. in based market specializing our team in a loan including companies the sized diversify medium to to mortgages. helps four-family it to one- because and portfolio securities loan mortgage-backed real to year commercial commercial exposure the our in rate For billion interest growing real offices. $1.08 our production on commercial and reduces loan loans and focusing and Jersey portfolio multi-family are New in multi-family We and billion more City $2.16 loans. York originated originating estate New we on 2016, our 31, through focusing December area by ended market growth our in this loans of estate majority the accomplished in deposits total Portfolio of Loan 10 area. the metropolitan top Diversifying and York latest and the New Growing the products in the 2016, ranked within offer 30, was 20 June top competitors deposits of the of As our in share banking. and of private market Jersey New and our Some of services available, State trust funds. are the short- as statistics mutual such from which offer, deposits and mortgage for not for date institutions, firms do competition currently savings brokerage additional we banks, that face funds, services We commercial market companies. from insurance money principally and term unions comes and credit deposits market firms, and banking mature loans strong a for have competition serve we median. counties to national the important the is of than it greater All serve, incomes populated. we household counties median densely the have are all of nearly many counties for these projected is that growth note population slower Though 2021. through and that locally opportunities business a on as robust capitalize that and of believe compete We can centers area. banks. we market community and our extremes, in local these centers exist households smaller money between as headquartered situated income out-of-state well institution, from as high headquartered be by institutions The to of characterized financial tends assets. are markets super-regional by areas they these and measured in as centers, as competition perspective Our Jersey demographic population activity. New and commercial this economic of We dense of an state Jersey. result from and the a New desirable in As large are throughout headquartered acquisitions. in branch bank markets operate and largest Long we historic bank on the markets select Counties our is and Suffolk Bank in growth include and Investors novo Nassau to presence growth, de as franchise our well through our as expansion strengthened expanded City this have have York accomplished We New we grow. of boroughs to Additionally, the opportunities Island. and with Philadelphia us of provide suburbs to the continue will they believe to continue Markets will Attractive Our areas, through Opportunities metropolitan relationships York customer profitable New commercial. develop and and and consumer build attractive both Jersey to the business, is of New believe focus lines growth, We primary greater all expansion. organic Our across the opportunities. product including growth as factors, namely, with well of us in, as number provide acquisitions, operate a branch to we and attributed bank markets be openings, can branch transformation novo Our de deposits. core and loans ofrhrdvriyorla otoi ehv nrae & edn ybidn eainhp ihsmall with relationships building by lending C&I increased have we portfolio loan our diversify further To have We portfolio. loan our diversify and grow to be, to continue will and been, has plan business Our Our area. market our in deposits attracting as well as loans making in competition intense face We growth income household strong to moderate experience to projected are serve we counties the of Many we and States, United the within markets banking attractive considered are in operate we markets The 3

FORM 10-K 4 branches in Gloucester County, New Jersey) the Philadelphia suburbs of New Jersey) in Brooklyn, Queens, Staten Island, Manhattan and Long Island) Brooklyn and Long Island) We have focused on changing our deposit mix from certificates of deposit to core deposits (savings, Our deposit business has become more diversified over the past few years as we attract more deposits from A significant portion of our historic growth can be attributed to our acquisition strategy. Through 2014 we • Gateway Community Financial• Corp., completed January 2014 Roma Financial ($254.7 Corporation, million completed December• of 2013 deposits ($1.34 billion and of 4 deposits Marathon and Banking 26 Corporation, branches completed in October• 2012 ($777.5 million in deposits Brooklyn and Federal 13 branches Bancorp, completed JanuaryThese 2012 acquisitions ($385.9 have million provided in us deposits with and the 5 opportunity branches to in grow our business, expand ourIn geographic May 2016 we signed a definitive merger agreement with the Bank of Princeton, withCapital assets management is of a key component of our business strategy. We raised net proceeds of $2.15 billion in Changing the Mix of Deposits checking and moneygenerally market a more accounts). stable Core sourceof of December deposits low 31, cost are 2016, funding wecompared an and had to are core attractive December less deposits 31, sensitive funding of 2012 tothe $12.33 when alternative changes same billion, core time, in representing because deposits the market approximately were percent interest they 81%to $5.80 of rates. of maintain billion, non-interest are total representing these bearing deposits, 66% deposits favorable to of As staff results total total training, and deposits deposits. trends, product has Over we development grownhave will from as 10% developed continue well to to a as 14%. invest commercial suite Inmid-sized in deposit order of additional gathering business commercial de efforts. deposit owners novo Overdeposit and branches, and the capture. cash branch past non-profit Mobile management few banking organizations products, years serviceschanging designed we including environment. have to We also electronic will appeal been continue deposit developed toto to our to services small enhance customers. serve our and such our web customers’ site as and needs remote use and social adapt media to as a a way to staycommercial connected entities, including most oflargest the depositories businesses for that government borrowfunding and from us. municipal source. Investors deposits Our Bank in branch haspopulation, New become network, will Jersey, one continue concentrated which of to provides the in provide us us markets with with with opportunities an to attractive additional grow demographics and improve andAcquisitions our a deposit high base. density completed eight bankconsidering an or acquisition, we branch haveSome maintained of acquisitions. a our fundamental most Although focus recent on transactions management preserving have tangible included evaluates book the value following a per acquisitions: share. number of factors when footprint and improveopportunities that our may present financial themselveswe in have performance. the adhered future to We while in maintaining the intend the past. financial to and pricing continue discipline that to$1.0 evaluate billion, potential operating ten acquisition the branches in uncertainty New Jersey of andtransaction. three the in the timing Philadelphia market. around In January regulatory 2017, due approval,Capital to Management both parties mutually agreed toequity in terminate May 2014 the upon the completion of the second step mutual conversion. As of December 31, 2016 our

FORM 10-K n ahsredrvlelnigo ieisrnecnrcs tDcme 1 06 osmradohrloans other and credit consumer of 2016, loan 31, lines 31, total portfolio. equity December December loan our home At total at loans, our of contracts. loans of equity insurance 1.7% 3.2% total home life or or of our million, on $597.3 million, primarily lending of totaled consist $314.8 value 25.1% which surrender totaled or loans, cash billion, loans consumer billion, and $1.28 offer construction $4.71 totaled also and loans represented We industrial portfolio, loans loans 2016. and estate loan 31, mortgage commercial real total December portfolio, Residential commercial loan At portfolio, our portfolio. total loan loans. of our total other 6.8% of our and 23.7% of or 39.7% or consumer or billion, and billion, $4.45 loans $7.46 totaled totaled mortgage loans residential multi-family loans, 2016, industrial and commercial that Bank markets. local Investors Activities our Lending at in culture Bank a Investors creating of to presence the contribute enhancing efforts while youth these morale believe education, employee We high arts, others. promotes the help to in to ability initiatives donations meaningful supporting in by million citizens $23.4 York committed services. New human or are and and contributed health Jersey and which Employees has housing, New Foundation, affordable Bank Foundation. Charitable of development, Investors Roma others. lives Charitable help the 2013, the to and December Investors support enrich 2005, Bank’s in in the Investors established acquired use Foundation, and and we Charitable communities Investors efforts their the in volunteer leaders Through become to employee encouraged through continually York New which 40% was ratio payout Communities share. Our dividend per in our $0.08 Involvement to 2016 2016 ended of quarter year fourth the the For in increase share. dividend per 33% a $0.08 includes to increased of has price receiving dividend average an Since at program. million $746.3 buyback totaling the shares 10% of million we a 62.9 anniversary Subsequently repurchased authorizing one-year program. have the repurchase each we $11.86. share to 2015 programs first prior March growth, our in repurchase program organic announced approval buyback additional and of 5% conversion two combination Governors a step of a announced commence Board second through the to our from capital System of approval our received completion Reserve we manage Federal 2015 We March the In 13.10%. of dividends. was and repurchases ratio stock asset acquisitions, to equity tangible u onprfloi opie fmlifml on,cmeca elett on,cntuto loans, construction loans, estate real commercial loans, multi-family of comprised is portfolio loan Our a with staff our provides and Bank Investors of values principal the of one is involvement Community and Jersey New in serves it communities the in life of quality higher a promotes proudly Bank Investors our then Since share. per $0.02 of dividend cash quarterly a pay to began we 2012, of September Beginning 5

FORM 10-K % (12,474) Total (228,373) 2012 $18,569,855 Amount % Other Loans Consumer and 2013 Amount Loans Mortgage Residential % Loans 2014 Construction (In thousands) December 31, Amount At December 31, 2016 (Dollars in thousands) % Commercial and Industrial Loans 6 2015 Amount Loans Real Estate Commercial % Loans 2016 Multi-Family The following table sets forth the composition of our loan portfolio by type of loan. Amount The following table summarizes the scheduled repayments of our loan portfolio based on contractual Portfolio Maturities. Loan Portfolio Composition. Net loans Total loans $7,459,131 $4,452,300 $1,275,283 $314,843 $4,711,880 $597,265 $18,810,702 deferred loan fees, net deferred loan costs(1) (12,474) (11,692) (11,698) (8,146) 10,487 Home equity loansHome equity credit linesOther 240,518 161,356 1.28 0.86 220,357 201,063 1.30 1.19 195,391 200,066 1.04 222,871 1.32 1.48 75,136 150,796 0.45 245,653 1.15 1.88 131,808 18,017 101,163 1.26 0.12 0.97 7,600 0.06 5,951 0.06 Multi-family loansCommercial real estate loansCommercial and industrial loansConstruction loans 1,275,283 4,452,300 23.67 6.78 $ 7,459,131 39.65% 3,829,099 $ 1,044,385 6,255,904 22.67 37.04% 6.18 $ 5,049,114 314,843 3,147,153 33.44% $ 20.84 3,986,208 544,458 1.67 30.51% $ 2,995,471 3.61 2,505,327 28.70% 19.18 225,843 268,422 1.34 1,971,689 18.89 2.05 148,396 169,258 0.98 1.62 202,261 1.55 224,816 2.15 Allowance for loan losses Premiums on purchased loans and Total due after one year 7,288,177 4,075,739 896,873 18,651 4,417,450 444,242 17,141,132 Amounts Due: One year or lessAfter one year: One to three yearsThree to five yearsFive to ten yearsTen to twenty yearsOver twenty years $ 170,954 $ 1,067,202 376,561 2,560,439 754,567 $ 1,338,433 3,237,622 378,410 422,914 1,656,287 $296,192 210,010 88,733 320,230 $ — 294,430 412,492 155,124 $153,023 18,425 — 6,222 $ 1,669,570 353,948 226 447,052 — 106,046 30,514 612,232 123,036 1,080,251 2,388,921 65,203 4,678,970 77,866 — 5,984,062 2,056,385 1,923,967 72,091 2,032,794 maturity, including PCI loans at December 31, 2016. Overdraft loans are reported as being due in one year or less. Net loans(1) Included in unamortized premiums and deferred loan costs are accretable purchase accounting adjustments in connection with loans acquired. $18,569,855 $16,661,133 $14,887,570 $12,882,544 $10,306,786 Net unamortized premiums and Allowance for loan losses (228,373) (218,505) (200,284) (173,928) (142,172) Total consumer and other loansTotal loans 597,265 3.18 496,556 2.94 $18,810,702 100.00% $16,891,330 100.00% 440,954 $15,099,552 100.00% $13,064,618 100.00% $10,438,471 2.92 100.00% 404,049 3.09 238,922 2.29 Residential mortgage loansConsumer and other loans: 4,711,880 25.05 5,039,543 29.83 5,769,477 38.21 5,698,351 43.62 4,838,315 46.35 Total commercial loans 13,501,557 71.77 11,355,231 67.23 8,889,121 58.87 6,962,218 53.29 5,361,234 51.36 Commercial loans areconstruction comprised loans. Our of primary multi-family focus over loans, recent years commercial has been real on estate the origination loans, of commercial commercial loans. and industrial loans and Commercial loans:

FORM 10-K opeino otoso h rjc.Cntuto iacn o nt ob odrqieapesl rw will we or pre-sale the a require reflecting sold schedule be cost a actual to contract. with the units sales or a accordance for property, without income-producing in financing building completed speculative on Construction the inspections of of project. on amount developers value the the based appraised limit and of the disbursed portions builders of are of three-year 70% to Funds a to completion have up directly improvements. to of structured the loans amounts are in of offer loans made construction are We Generally, and units. portfolio. term housing for-sale loan residential total and properties our groups of and 1.7% corporations housing Company’s Co-operative the in to Included loans million. of $70.3 million totaled $95.0 healthcare loans the were loans”). lending to (“Co-Op loans based offerings lending asset industrial product expanded 2016 and our including 31, broadened commercial subspecialties, have December personal we lending general of a grown, industrial the by As have on and supported industry. and footprint lien further commercial our a and loans are and certain and/or cases term Company commercial create estate many the real credit, to in to As of and of owner. comprised facilities business, the be lines the credit of can of are guarantee loans of receivables of offerings and range types inventory credit these including wide for Our assets, collateral a footprint. The offer credit. geographic of We our letters loans. throughout industrial clients and industrial commercial was to are 2016. portfolio 31, loans five December estate generally at real million are commercial other $700 in loans approximately Included and estate totaled adjustable- years. which real thirty and buildings loans to Commercial and mortgage fixed-rate fifteen office commercial rates. York over both occupied amortized market of buildings, owner New loans prevailing consist balloon Jersey, retail at term portfolio New year originated properties, our fifteen in were in industrial which loans loans loans estate by estate rate real real secured Commercial commercial are properties. originate commercial which We states, loans. and estate surrounding fixed-rate real both commercial of to was five consist generally years. portfolio are thirty loans York, our to Multi-family fifteen New in over rates. in amortized market loans loans loans prevailing balloon multi-family multi-family term at year originate originated The fifteen to were states. which been loans, has surrounding adjustable-rate generally and policy Jersey Our New loans. multi-family of comprised 2017. 31, December after due h olwn al esfrhfxd n dutbert on tDcme 1 06ta r contractually are that 2016 31, December at loans adjustable-rate and fixed- forth sets table following The osrcinLoans. Construction Loans. Industrial and Commercial Loans. Estate Real Commercial Loans. Multi-family omrilloans: Commercial oa osmradohrlas19872445444,242 284,435 159,807 4,417,450 12,279,440 8,008,615 1,300,524 4,270,825 3,116,926 loans other and consumer Total loans: other and Consumer loans mortgage Residential loans commercial Total osrcinlas1,1 ,3 18,651 7,733 10,918 896,873 7,288,177 $ 4,075,739 $5,151,795 289,654 2,559,433 $2,136,382 607,219 1,516,306 loans Construction loans industrial and Commercial loans estate real Commercial loans Multi-family te 9 9,3 192,236 191,938 $17,141,132 298 $9,593,574 92,497 159,509 $7,547,558 92,497 — — 159,509 loans Total Other lines credit equity Home loans equity Home tDcme 1 06 74 ilo,o 97,o u oa onprflowas portfolio loan total our of 39.7%, or billion, $7.46 2016, 31, December At tDcme 1 06 ehl 348mlini osrcinlasrepresenting loans construction in million $314.8 held we 2016, 31, December At tDcme 1 06 44 ilo,o 37,o u oa onportfolio loan total our of 23.7%, or billion, $4.45 2016, 31, December At tDcme 1 06 12 ilo,o .% forttlloan total our of 6.8%, or billion, $1.28 2016, 31, December At 7 Fixed u fe eebr3,2017 31, December After Due I thousands) (In Adjustable Total

FORM 10-K 8 At December 31, 2016, $4.71 billion, or 25.1%, of our loan portfolio At December 31, 2016, consumer and other loans totaled $597.3 million, or Residential Mortgage Loans. We offer various loan programs to provide financing for low-and moderate-income home buyers, some of Consumer and Other Loans. During 2014, we started to offer cash surrender value lending on life insurance contracts. At December 31, consisted of residential mortgageInvestors loans. Home Residential Mortgage, mortgage forfrom our loans loan are correspondent portfolio originated and by entitiescorrespondent for our entities sale including to mortgage to originate subsidiary, third other loansloans parties. with that servicing We adhere banks rights. to also our and purchase underwriting mortgage standards. mortgage loans In most brokers. cases, we Our acquire the agreementswhich include call down forreceive payment a these reduced assistance rate of foras interest well home on as most other purchases. of incentives our Through if loan certain these programs conditions and are programs, have met. their qualified application fee individuals refunded at3.2% closing, of our totalequity loan lines portfolio. of credit Weequity and offer cash lines consumer surrender of loans, value credit mostloans lending are are of on offered life which secured with insurance consist bylines fixed contracts. of residences of rates Home credit home primarily of equity have equity interest, located loans adjustable loans, terms rates and in of up home home New interest, to indexed Jersey 20 to years and the and New prime to rate. York. a Home2016, maximum equity cash of surrender $500,000. Home valueon equity loans totaled these $191.9 million, loans$3,000,000. or allows Acceptable 32% of credit a consumer historyrating policy and and of other the FICO owner loans. insurance scores carrier. The to are underwriting borrow reviewed along a with minimum the evaluation credit of line the financial of $65,000 up to a maximum of

FORM 10-K te tm,nt1 530 810 (24,562) 204,075 (32,412) (8,100) — (394,742) — (9,752) (5,360) 233,856 2,005,026 $ — 1,773,563 reviewed (2,139,676) $ — are authorities 198,624 Lending limits — 1,908,722 (2,945,853) individuals. ratification. the for $ type, of and Board loan authorities experience our each and approves to policy (3,302,546) with capability, Committee submitted position, Risk associated ultimately authority on Credit risk are 233,856 based Bank’s which the individual are lending The 141,563 personnel, on 144,324 borrower. of credit based a Our and hierarchy set of lending balances a are for renewals. loan limits is aggregate Approval — and used and Directors. amount, method 54,300 of credits loan approval Board The the new by — requests. for periodically loan of authorities decline lending or approval 141,563 and underwriting estate Procedures real and other Policy Credit to transferred loans provisions, loss loan recoveries, 3,763,745 and charge-offs include items Other 4,923,634 124,273 (1) 5,084,817 portfolio loan in 247,791 increase Net acquisition in acquired loans Net 608,076 net(1) 260,023 items, Other repayments Principal 3,031,396 646,521 sold Loans 4,029,322 purchases loan Total 523,342 loans other 4,301,452 and Consumer loans mortgage Residential loans commercial Total loans: Commercial purchases: Loan originations loan Total loans other and consumer Total loans: other and Consumer loans mortgage Residential loans commercial Total loans: Commercial originations: Loan purchases and originations Loan sale Origination, table. indicated. the periods from the excluded are for loans-held-for-sale receivable our loans to of respect with portfolio activities our repayment to and respect with activities repayment onOiiain n Purchases. and Originations Loan onApoa rcdrsadAuthority. and Procedures Approval Loan purchase and premiums, and discounts costs, and fees deferred of accretion adjustments. accounting and amortization and owned, osrcinlas——— — — — — $ — 842 2,760 — $ 141,564 — 93,081 — — $ 100,262 19,742 103,689 23,177 131,533 44,817 14,614 145,147 82,455 451,505 loans 445,360 Construction 869,705 loans industrial and 1,671,514 Commercial $ loans estate real 2,079,201 Commercial 930,777 $ 936,889 loans Multi-family 2,162,447 $ 608,899 1,078,601 Other lines credit equity Home loans equity Home loans Construction loans industrial and Commercial loans estate real Commercial loans Multi-family h olwn al hw u onoiiain,la ucae and purchases loan originations, loan our shows table following The h rdtapoa rcs rvdsfrpop n thorough and prompt for provides process approval credit The 9 2016 er ne eebr31, December Ended Years I thousands) (In 2015 2014

FORM 10-K 10 Purchased Credit-Impaired (“PCI”) loans are loans acquired at a The Bank’s regulatory limit on total loans to any one borrower or attributed to any One of the Bank’s key operating objectives has been, and continues to be, maintaining a high The underlying credit quality of our loan portfolio is dependent primarily on each borrower’s ability to Purchased Credit-Impaired Loans. Asset Quality. Loans to One Borrower. continue to make required loanthe payments collateral and, securing in the thefour-family event loan, a mortgage if borrower loans any. is and A unablecase to consumer borrower’s of continue loans, ability multi-family to primarily and to do commercialC&I on pay so, real the typically employment loans, estate value is and of loans, dependent; on other onconditions. in sources the the the Other of cash case cash flow income; factors, of generated inimpact flows by such one-to a the the borrower’s generated as property; ability to in by unanticipatedof pay. the Collateral expenditures the case factors values, of or particularly business, including realdelays. changes estate which general values, in are in economic also the turn impacted conditions, by financial is a demographics, markets, variety impacted maintenance may by and also general collection economic or foreclosure discount, due in part toare credit initially quality. recorded PCI loans atvaluation are fair allowance accounted value (i.e., for (as in theexpected accordance determined at allowance with by acquisition ASC for and the Subtopic loanrecognized the 310-30 present losses). initial as and value carrying The interest of amount income differencepayments expected (fair utilizing between value) future for the the of cash level-yield interest the undiscounted flows)“non-accretable method PCI and cash with difference,” over loans, flows are principal no or the not the life that recognizedReclassifications “accretable of as exceed yield,” of the a is the loans. yield the adjustment, Contractuallyacquisition undiscounted non-accretable dates as required due cash a difference to loss flows increases accrual toprospective in or expected basis. expected the a cash at valuation flows accretable allowance. of acquisition, the yield or loans may and the would occur result in subsequent an increase to in yield the on a loan one borrower is 15%was of $445.0 unimpaired million. capital The andthe Bank’s surplus. internal Board As policy of of limit Directors’group December is ratification $150.0 31, exposures on million, 2016, on with the totalDecember the regulatory a loans option 31, lending to regular to limit 2016, a exceed basis.$120.7 borrower that the million The limit or Bank’s in with Bank related commercial largest loans borrowers. alsoin consisting relationship accordance The sets of with with Bank its six additional contractual reviews shopping an terms. centers limits these individual and on three borrower retail size and stores of and its was loans performing related by entities loan was type. At level of asset quality. Theoriginate Bank maintains or sound credit purchase standardscontains for interest sub-prime new only loan loans, and originations notypes negative and income purchases. verification of amortization We residential residential mortgage do loans loans, not loan2016 we are products. or no $124.2 longer Included option million originate in or interestto ARM purchase residential only time these and and loans. and $246.0 for consumer While competitive millioncommercial loans purposes, in loans our originate for no for commercial income portfolio the the loans verification periodBank period with loans. uses ended limited ended The proactive December interest collection Bank December 31, only and does, 2016 31, workout periods. from are processes Included time in $588.4 in dealing million total with in delinquent interest and only problem loans. loans. In addition, the

FORM 10-K niae,ecuiglascasfe sPCI. as classified loans excluding indicated, icsinadAayi fFnnilCniinadRslso prtos”Tetbeblwst ot the forth sets below table The indicated. dates Operations.” the at of loans “Management’s PCI loans Results 7, excluding non-accrual assets and Item our non-performing total of see Condition our discussion losses, of of Financial further loan categories percentage For and for of amounts a 2015. allowance Analysis 31, as the December and and losses at loans 2016 loan Discussion 189.30% non-performing 31, from for December and 2016 allowance at assets 31, 0.47% The December non-performing to at 2015. decreased 242.24% assets 31, to total December increased to at assets non-performing 0.69% of from ratio Our bulk 2015. a 31, on December million During $20.9 2016. totaling during loans) PCI loans 2016 (including non-performing 31, loans of December non-performing sales of at no pool were million a There basis. $94.3 sold 2015. to Company 31, million the December 2015, $21.1 at by million decreased $115.4 loans from Non-accrual properties. at commercial of interest single all by accruing monitoring secured still actively are is relationship and Management this more ratios. for a value loans or is to The 2016 days loan 31, million. loans. December strong 90 $32.2 these ended with and year for delinquent properties the (“REO”), loans for well-collateralized loans 6 owned days tenant, 60-89 totaling any estate loans relationship delinquent real have loan in and Included not single 2015. restructurings and did 2016 debt We 31, troubled December loans. performing PCI interest, accruing excludes still and more loans: Commercial 2015 31, December At loans: Commercial 2016 31, December At eiqetLoans. Delinquent h ai fnnacullast oa on erae o05%a eebr3,21 rm06%at 0.68% from 2016 31, December 792 at 0.50% to decreased loans total 9,403 to loans 8 non-accrual and 4 of properties ratio residential The 18 168 of consisting 83,516 792 1,886 million 8,976 $ $4.5 4,386 of 6,781 REO 361 2 had we 137 4 2016, 68,560 31, 15 December 21 427 1,886 At $ — 301 — 4,386 6,429 2 14,956 31 7,784 13 18 — — 60 — — $ 352 125 69,049 — 1,333 — 7,065 $ Assets. 3,856 Non-Performing 3 2 338 2 115 38,409 — 58,119 10 719 234 loans other and — 22 Consumer 286 $ 2,971 loans mortgage Residential 10,930 1 6,445 10 6 loans — Construction 52 loans 1,099 industrial 14 and $ Commercial loans estate 885 real Commercial 31,964 1 loans Multi-family 8 4 loans other and Consumer loans mortgage Residential loans Construction loans industrial and Commercial loans estate real Commercial loans Multi-family oa 6$57545$10951$106,764 571 $91,029 475 13,845 $15,735 96 42 13,493 37 $120,431 497 352 $74,834 422 5 $45,597 43,598 75 34 Total 9,650 21 loans commercial Total 33,948 13 Total loans commercial Total h olwn al esfrhorla eiqece ytp n yaon ttedates the at amount by and type by delinquencies loan our forth sets table following The o-efrigast nld o-cra on,lasdlnun 0dy or days 90 delinquent loans loans, non-accrual include assets Non-performing Number 11 08 Days 60-89 on eiqetFor Delinquent Loans Amount Number Dlasi thousands) in (Dollars 0Dy n Over and Days 90 Amount Number Total Amount

FORM 10-K 2012 2013 2014 December 31, (Dollars in thousands) 2015 2016 12 Real estate we acquire as a result of foreclosure or by deed in lieu of foreclosure is Federal regulations provide that loans and other assets of lesser quality should be Total non-accrual loans 94,274 115,426 108,359 100,360 120,568 Total commercial loans 14,346 24,304 24,177 26,078 38,035 We are required to establish an allowance for loan losses in an amount that management considers prudent At December 31, 2016, there were $30.4 million of loans deemed trouble debt restructurings, of which Real Estate Owned. Classified Assets. Residential mortgage loansConsumer and other loans 72,593 81,816 7,335 79,971 9,306 72,309 4,211 81,295 1,973 1,238 Multi-family loansCommercial real estate loansCommercial and industrial loansConstruction loans 4,659 9,205 $ 10,820 9,225 482 $ 13,940 3,467 2,903 $ 2,711 — 2,989 1,281 $ 5,905 $ 753 11,143 792 375 4,345 16,181 25,764 classified as “substandard,” “doubtful” orprotected “loss” by assets. An the asset“Substandard” is current assets considered “substandard” include net if those worthdeficiencies it characterized is and by are inadequately the paying not “distinctclassified capacity corrected. possibility” “substandard,” we with of Assets the will the classifiedfull,” added sustain characteristic “some obligor on as the loss” the or weaknesses “doubtful” ifAssets present basis the of have classified make as of the “collection all “loss” or currently collateral are ofwithout liquidation those existing the in pledged, the considered establishment facts, “uncollectible” if of weaknesses and conditions, athe of any. inherent specific such and asset loss little in values, reserve value has their is those impaired “highly continuance not a as warranted. questionable or assets We potential and classified classifyaddressed, an improbable.” weakness the assets, asset value as that management of “special the warrants mention” has asset if may management’s concluded deteriorate, adversely close that affecting the if attention. repayment of the Whilefor the loans asset. potential such classified substandard weakness assets orallowances, doubtful, in are which as the well have not as been asset forwhich, established other is problem to unlike loans. recognize not specific General theproblem allowances allowances, inherent represent assets loss losses as have “loss,” associatedamount we not with are of lending been required the activities, either asset allocated but toassets so and to establish classified the a or particular amount specific to of allowanceand problem our charge for valuation Insurance off assets. losses allowances such and equal is When amount. to subjectgeneral the Our to 100% or we Federal review specific determination of loss by classify the Deposit as allowances. the to Insurance New the Jersey Corporation, classification Department which of of Banking our can require that we establish additional Real estate ownedPerforming troubled debt restructuringsTotal non-performing assetsTotal non-accrual loans to totalTotal loans non-performing assets to total assets$9.5 million were classifiedDecember 9,445 31, as 2016, accruing interest andaccordance income with $20.9 that their million would original were have 22,489 termssuch amounted been classified loans to for recorded as $4.9 the had million. year non-accrual. our ended We For non-accruing December recognized 31, the loans interest 35,624 2016. income been year $108,211 0.47% of current ended $2.6 in million 0.50% on $144,198classified as 39,570 real $151,822 estate 0.69%date owned of (“REO”) 4,492 foreclosure $148,446 until 0.68% less sold.charges 15,756 When estimated to $144,417 property costs expense 0.81% is toresidential after acquired properties sell it and acquisition. 0.72% 6,283 the 8 is commercial At property. recorded properties. Holding December at fair costs 0.95% 31, value and 2016, at declines we 0.77% the in 7,839 had fair REO value 1.14% of result in $4.5 million 1.16% consisting 8,516 of 18 8,093 Non-accrual loans:

FORM 10-K gnismyrqieu orcgieadtost h loac ae nterjdmnso information of judgments their on based Such losses. allowance loan the for to examination. allowance additions their our of recognize time review the to at periodically them us to will available require Corporation Insurance may Deposit agencies or Federal economic the are if and that necessary be estimates the may make established additions environment. to have current future the we us losses, from believe estimable differ requires future we and it in the Although probable in inherent as conditions available. absorb losses other subjective, to becomes of levels is information estimate at best more process as management’s allowance as analysis losses represents revisions loan that this to for level However, allowance susceptible a The portfolio. general at Results Losses.” loan maintained the and Loan Condition is with for the Financial 2016 for Allowance along of losses allowance 31, — Analysis activities, our December Policies and the loan establishing Accounting Discussion of in of “Management’s considers Critical section methodology — volume the management our Operations and in of of losses, forth nature description set A the loan is conditions. losses in for market loan changes estate allowance and real portfolio and the economic loan determining our in In inherent estimable. reasonably and Schedules.” Statement and Losses Financial 1 Loan 31, and Note for at Exhibits Allowance see December impaired - loans, ended 15 impaired as “Item our year in on classified the Statements detail loans Financial during further Consolidated For to received to million. Notes income related $1.5 of totaled Interest 4 losses impaired Note million. as loan classified $1.6 for loans an to are on of allowance the 2016 amounted definition loans The Company’s of 2016, the million. homogeneous 31, are value meeting and $34.4 loans December balance fair impaired, 2016, totaled include of 31, Smaller the definition loans December loan Company’s Such flows. At of impaired the restructure. loans. meeting cash excess debt impaired not from troubled in future loans excluded a and specifically in not expected loans, modified consumer is the are loans, they mortgage value of unless residential are carrying collectively loans value impairment Impaired loan’s on impairment. present for for evaluated the and the agreement will that loan or million they the determine probable of collateral $1.0 is terms to it an contractual than that with evaluated the information loans under greater specific individually due commercial has agreement. amounts other balance management loan all and if collect (“TDR”), the outstanding million not restructuring of $1.0 an debt than terms troubled greater contractual with a balance the outstanding in loans under modified due loans commercial status, amounts non-accrual all evaluates collect Company not will The lender the that information, assets. non-performing constitute assets classified all Not regulations. applicable with accordance erve h onprfloo urel ai odtriewehraylasrqiecasfcto in classification require loans any whether determine to basis quarterly a on portfolio loan the review We sa nerlpr ftereaiainpoess h e esyDprmn fBnigadInsurance and Banking of Department Jersey New the processes, examination their of part integral an As probable both are that losses loan absorb to necessary level a at maintained is losses loan for allowance Our Loans. Impaired h opn eie nipie ona onfrwihi spoal,bsdo current on based probable, is it which for loan a as loan impaired an defines Company The 13

FORM 10-K 2012 2013 2014 (Dollars in thousands) Years Ended December 31, 2015 14 2016 The following table sets forth activity in our allowance for loan losses for the Total recoveries 5,115 4,437 7,100 3,866 4,080 Total charge-offs (14,997) (12,216) (18,244) (22,610) (44,150) Multi-family loansCommercial real estate loansCommercial and industrial loansConstruction loansResidential mortgage loansConsumer and other loans 541 689 1,885 1,631 295 807 445 102 267 2,295 516 201 3,784 1,783 278 317 604 65 219 2,528 799 17 23 — 43 593 315 135 3,387 34 Multi-family loansCommercial real estate loansCommercial and industrial loansConstruction loansResidential mortgage loansConsumer and other loans (4,485) (455) (161) (516) (1,021) (9,425) (2,447) (6,147) (284) (419) (9,526) (52) (1,101) (516) (7,715) (323) (403) (466) (15,508) (479) (1,266) (99) (972) (20,180) (640) (9,058) (3,424) (795) (13,227) (1,107) Allowance for Loan Losses. total loans outstandingaverage loans outstandingnon-performing loans(1) 1.21% 0.06% 220.18% 1.29% 0.05% 158.43% 1.33% 139.10% 0.08% 124.30% 1.33% 0.17% 104.29% 1.36% 0.43% (1) Non performing loans include non-accrual loans and performing troubled debt restructured loans. Net charge-offsAllowance balance (end of period)Total loans outstandingAverage loans outstandingAllowance for loan losses as $ a percent of 228,373Net loans charged $ off as a percent of 218,505Allowance $ for loan losses to 200,284 $ $18,810,702 17,479,932 $16,891,330 173,928 $15,099,552 15,716,010 $ $13,064,618 (9,882) $10,438,471 13,776,250 142,172 11,065,190 (7,779) 9,271,550 (11,144) (18,744) (40,070) Recoveries: periods indicated. Allowance balance (beginning of period)Provision for loan lossesCharge-offs: $ 218,505 $ 200,284 $ 173,928 $ 142,172 $ 117,242 19,750 26,000 37,500 50,500 65,000

FORM 10-K loae yla aeoyadtepreto on nec aeoyt oa on ttedtsidctd The indicated. dates categories. the other particular in at any losses in loans absorb losses to total future allowance to of the of indicative category use necessarily each the not restrict in is not category loans does each and of to category allocated percent losses the loan and for allowance category loan by allocated osmrPoeto c,kona h oce ue tDcme 1 06nn forscrte were securities our of none 2016 31, December At Rule. Rule. Volcker the and Volcker under Reform fund Street the covered Wall a as Dodd-Frank be the to known of deemed sections Act, implement to Protection securities Consumer preferred trust by backed it obligations risk- determine our to on factors. security risk effect other its each and consider of appreciation must and/or analysis analysis yield pre-purchase for The prospects objectives. thorough measurement, management a capital asset/liability based upon overall based our are to conforms decisions sale and Purchase Treasury 11,361 U.S. invest may to, Bancorp other Investors to limited limitations. addition, loans certain In short-term to funds. not subject and mutual securities and overnight mortgage-backed are equity instruments, institutions, in subdivisions, debt financial but Municipal corporate insured grade and of investment include, State deposit banks, Agencies, of may certificates Federal certain various purchased securities, by 13,027 issued investments securities Our obligations, regulations. investment are 2.2 at securities Directors all of Board and the followed by are ratified and is Policy for 16,062 meetings. reviewed responsible Investment scheduled which are is regularly 6,577 the transactions Treasurer their Committee, Investment in The investment. Liability Liability included Treasurer. for Asset our prudent requirements Asset the with considered and by 1.6 primarily the guidelines developed rests are to the actions strategies specific ensuring Policy investment of operational general execution Investment delegates While the Directors the officers. Committee, are 8,947 of senior policy Board of the of The to Directors. comprised implementation changes of primarily the and Board the management for by by 1,306 approval annually responsibility to reviewed 1.0 subject is and Policy to Investment recommended The invest. may we which 6,488 28.7% 29,853 Investments 1.3 Security $ 2,190 30.5% 6,794 42,103 $ 33.4% 1.7 Unallocated 71,147 $ other and Consumer 11,653 37.0% Residential 88,223 loans $ Construction 39.6% and Commercial 95,561 $ real Commercial loans Multi-family period of End on ,5 . ,5 . ,4 . ,6 . ,8 2.3 2,086 3.1 2,161 1.6 46.4 2.9 45,369 4,094 3,347 18.9 43.6 2.1 33,347 51,760 2.9 9,273 19.2 38.2 3,155 46,657 3.6 47,936 3.2 20.8 20,759 29.8 2,850 44,030 31,443 6.2 22.7 25.0 40,585 46,999 19,831 6.8 loans 23.7 loans mortgage 43,492 52,796 loans industrial loans estate to: allocated oa loac 2833100 2855100 2024100 1398100 1212100.0% $142,172 100.0% $173,928 100.0% $200,284 100.0% $218,505 100.0% $228,373 allowance Total loaino loac o onLosses. Loan for Allowance of Allocation nDcme 03 euaoyaece dpe ueo h ramn fcranclaeaie debt collateralized certain of treatment the on rule a adopted agencies regulatory 2013, manner. December sound In and safe a in conducted be transactions securities that requires Policy Investment The State Jersey New and Federal to conform transactions investment that requires Policy Investment Our in securities of types the determines policy This Policy. Investment our adopted has Directors of Board The Allowance o Loan for Losses 2016 oa Loans Total aeoyto Category ecn of Percent on in Loans Each Allowance o Loan for Losses 2015 oa Loans Total aeoyto Category ecn of Percent on in Loans Each h olwn al esfrhtealwnefrla losses loan for allowance the forth sets table following The 15 Allowance Dlasi thousands) in (Dollars o Loan for Losses eebr31, December 2014 oa Loans Total aeoyto Category ecn of Percent on in Loans Each Allowance o Loan for Losses 2013 oa Loans Total aeoyto Category ecn of Percent on in Loans Each Allowance o Loan for Losses 2012 oa Loans Total aeoyto Category ecn of Percent on in Loans Each

FORM 10-K 16 Our corporate and other debt securities portfolio primarily consists of We purchase mortgage-backed pass through and collateralized mortgage At December 31, 2016, we had $38.0 million in municipal bonds which represents 1.1% At December 31, 2016, our securities portfolio totaled $3.42 billion representing 14.7% of our total assets. Mortgage-Backed Securities. Mortgage-backed securities present a risk that actual prepayments may differ from estimated prepayments Our mortgage-backed securities portfolio had a weighted average yield of 1.91% forWe the also year may ended invest in securities issued by non-agency or private mortgage originators, providedCorporate those and Other Debt Securities. At December 31, 2016, the trust preferred securities portfolio had an amortized cost of $39.1 million, or We continue to closely monitor the performance of the securities we own as well as the eventsMunicipal surrounding Bonds. Securities are classified$1.76 billion as of our held-to-maturity securitieswere were classified or classified as as available-for-sale available-for-sale held-to-maturity and and reported when reported at at fair purchased. amortized value. cost At and $1.66 December billion 31, 2016, obligation (“CMO”) securitiesenterprises) and insured Ginnie or Maeauthorities (government guaranteed agency), (collectively by and referred to2016, Fannie to a agency-issued Mae, lesser below mortgage-backed extent, Freddie as securitiessecurities a portfolio. “agency-issued including variety Mac of CMOs, mortgage-backed (government-sponsored federal totaled securities”). and $3.33 state At billion, housing December or 97.3%, 31, of ourover total the life ofany the security, discount which may relatingreinvestment require risk to adjustments associated to such with theadversely the instruments amortization affected by cash of that changes flows any in premium from can interest or rates such change and/or accretion securities. other of The the market variables. fair net value of yield suchDecember on securities 31, may such 2016. be $3.31 securities. The billion, which estimated There is fair $34.3 isincrease million value to less also interest than of rates the during our carrying 2016. value. mortgage-backed The securities decrease to at the fair December value 31, is attributedsecurities 2016 to are an was rated AAA byat nationally the recognized time rating of agencies purchase. andportfolio. satisfactorily Currently, pass the an Company internal does credit not review hold any non-agency mortgage-backed securities in its collateralized debt obligations (CDOs) backedbanks by pooled and trust preferred toobligations. securities The (TruPS), a principally interest issued lessersecurities rates by have been extent on classified in these insurance the held-to-maturity securities companies, portfolio reset since their real quarterly purchase. in estate relation investment1.14% to of trusts, 3 our andunrealized month total loss LIBOR position. collateralized securities Throughout rate. the portfolio, debt TruPS year These portfolio we and engage and a an prepare independentmanagement fair valuation our deemed firm value other-than that to the temporary assist ofvalue present us impairment, and $79.2 in value did or valuing of million not our OTTI, recognize projectedyear with analysis. any cash ended OTTI At none flows charges December December for for ofentirely 31, each the 31, the liquidated periods security 2015 2016, by ended was securities its the December greater Trustee. 31, in Company than 2016, recognized an 2015 the and book a 2014. For loss the of $646,000this on segment a of TruPSresult security the in which a market. future was We non-cash charge will to earnings. continue to evaluate for other-than-temporaryof our impairment, total which securities could Tax portfolio. Anticipation These notes bonds and are $4.6to comprised million diversify of of the $33.4 securities longer portfolio million term and New in are Jersey short-term designated Revenue Bond as Bonds. held Anticipation These to or purchases maturity. were made

FORM 10-K oa euiis$,3,7 34324$,4,4 31333$,5,9 $2,807,289 $2,750,294 $3,193,383 $3,146,345 $3,443,234 $3,435,076 been not have coupons securities and Municipal dates, occur. payment may contractual that final redemptions the early on or basis. based prepayments tax-equivalent are a of Maturities to impact table. adjusted the following the reflect in not $1,609,365 summarized do are $1,564,479 equity. 2016 our $1,888,686 31, of December 10% $1,844,223 of excess $1,782,801 in value $1,755,556 book aggregate an had that issuer any of securities the securities Total securities held-to-maturity Total $1,197,924 $1,185,815 securities: Mortgage-backed $1,304,697 $1,302,122 $1,660,433 $1,679,520 securities: Debt Held-to-maturity: securities available-for-sale Total securities: Mortgage-backed Available-for-sale: value fair the in indicated. fluctuations position. and capital value net our fair rates affect their directly interest at value, market carried in by are declines affected temporary held) are including (when and investments, investments investments such guaranteed Such of or fluctuations. insured market not stock are and securities Equity portfolio. portfolio. securities securities total total our of 0.2% than less representing million $2.1 totaled portfolio security our in held Enterprises eea osn uhrte 11 8 182 182 11 11 94,960 25,321 — 62,148 in Coupon. investment 24,320 no and had 27,116 we Maturities securities, Mac Portfolio Freddie 126,425 and Mae 44,365 Fannie — in 27,136 investments 65,236 our 82,403 for 502,320 except 2016, 31, 43,058 December 21,455 At 33,440 500,637 125,878 4,403 39,493 984,787 21,330 513,470 84,198 $ 77,817 4,388 974,376 37,978 514,339 16,420 $ 35,113 1,227,325 4,243 407,424 1,226,140 16,392 8,523 securities $ 84,245 mortgage-backed 1,233,079 410,133 Total 4,232 1,244,833 authorities $ housing Federal 6,887 $ 44,092 Association Mortgage 2,140 National Government 126 Corporation Mortgage Loan $ Home Federal 6,495 $ Association 2,128 Mortgage National Federal $ 5,778 $ 125 securities debt Total $ securities 6,660 debt 507,283 other and Corporate 24,679 $ 681,992 bonds 503,268 Municipal 5,825 enterprises sponsored Government 675,535 24,841 547,451 $ 726,072 546,652 46,747 724,851 598,439 47,538 1,008,587 603,774 available securities 1,022,383 mortgage-backed Total Association Mortgage National Government Corporation Mortgage Loan Home Federal Association Mortgage National Federal securities Equity Portfolios. Securities Securities. Equity Marketable Enterprises. Sponsored Government edt-auiy16138166931718017221152311,514,405 1,502,331 1,762,261 1,761,820 1,656,923 1,671,358 1,189,401 1,178,928 1,298,202 held-to-maturity 1,296,344 1,653,773 1,673,695 sale for h olwn al esfrhtecmoiino u netetscrte otoisa h dates the at portfolios securities investment our of composition the forth sets table following The tDcme 1 06 ehd$. ilo neut euiisrpeetn .%o our of 0.2% representing securities equity in million $6.7 had we 2016, 31, December At h opsto,mtrte n opnrt ftescrte otoi at portfolio securities the of rate coupon and maturities composition, The tDcme 1 06 etscrte sudb oenetSponsored Government by issued securities debt 2016, 31, December At Carrying Value 17 2016 arValue Fair Estimated Carrying Value tDcme 31, December At I thousands) (In 2015 arValue Fair Estimated Carrying Value 2014 arValue Fair Estimated

FORM 10-K Coupon Average Weighted Fair Value Total Securities Value Carrying Coupon Average Weighted Value Carrying More than Ten Years Coupon Average Weighted (Dollars in thousands) 18 Value through Ten Years Carrying More than Five Years Coupon Average Weighted Value through Five Years Carrying More than One Year Coupon Average Weighted 33,348 1.54 2,203 1.62 5,000 5.13 43,647 2.99 84,198 125,878 2.51 Value One Year or Less Carrying Deposits are the primary source of funds used for our lending and investment activities. Our sponsored enterprises $bonds —other debt securities — 33,348 $ 1.54 2,128 — 1.55 — 75 $ — 3.63 — — — — $ — — 5,000 — 5.13 4,555 $ 9.13 2,128 $ 39,092 2.28 2,140 37,978 1.55 39,493 44,092 2.45 84,245 2.60 Loan Mortgage CorporationNational —Mortgage Association —National —Mortgage Association — — — — 25,084 — 1.77 18,121 56,314 2.06 — 1.89 — 392,012 1,163,435 2.17 2.32 410,133 — 1,244,833 1,233,079 407,424 2.29 — 2.17 16,392 2.27 16,392 16,420 2.27 Loan Mortgage CorporationNational —Mortgage Association —National —Mortgage Association — — — — 14,972 — 2.55 75,639 142,704 2.74 — 2.16 — 528,135 864,707 2.01 1.94 603,774 — 1,022,383 1,008,587 598,439 1.98 — 2.10 47,538 1.84 47,538 46,747 1.84 General. Government Municipal Corporate and Federal Home Federal Government Federal Home Federal Government backed securitiesheld-to-maturity —securities — $33,348 25,084 1.54% 1.77 $27,287 1.76% 74,435 $ 79,435 1.93 2.13% $1,615,486 1,571,839 2.30% 2.28 $1,755,556 $1,782,801 1,671,358 2.27% 1,656,923 2.26 sale securities $ — — % $14,972 2.55% $218,343 2.36% $1,446,205 1.95% $1,679,520 $1,660,433 2.01% backed securities — — 14,972 2.55 218,343 2.36 1,440,380 1.96 1,673,695 1,653,773 2.02 securities: securities: Sources of Funds strategy is to increaseborrowings, core primarily deposit advances from growth theflow to Federal needs, fund Home to these Loan lengthen Bank activities.funds. the of In Additional maturities New addition, sources York of we (“FHLB”), of liabilitiessecurity to use funds for prepayments supplement a interest include and cash significant rate principal maturities, amount risk and repurchase management of interest agreements, and payments brokered to deposits, from manage income loans our on and cost other securities, of earning loan assets and Total mortgage- Total Total available-for- Held-to-Maturity: Debt securities: Total mortgage- Mortgage-backed Available-for-Sale: Equity securitiesMortgage-backed $ — — % $ — — % $ — — % $ 5,825 — % $ 5,825 $ 6,660 — %

FORM 10-K aig ,9,8 3702 ,5,0 5302 ,1,1 910.27 19.1 2,318,911 1.00 0.29 21.1 15.3 2,570,338 2,150,004 0.29 0.53% 1.14 100.0% 0.29 21.7 $12,172,326 0.56% 24.3 100.0% 2,643,769 13.7 $14,063,656 0.51% 3,416,310 100.0% 2,092,989 $15,280,833 0.29 0.91 —% 19.5 19.3 2,745,489 10.3% 2,947,560 1,249,070 deposits Total $ —% 0.45 deposit of Certificates 13.4% 25.6 1,890,536 Savings 3,916,208 $ —% 14.2% market Money 2,173,493 accounts Checking $ Interest-bearing: accounts Checking bearing: Non-interest a indicated. from consumers, from deposits deposits our attracting generate on to focused marketplace. remain our attempt market in We will operate area. by which and market municipalities affected primary products and our businesses deposit significantly within core group be our client diverse advertise to and and continue market attract will aggressively to ability deposits Our on funds. pay deposit obtaining we in respond rates competitive to us the be allows conditions. to offer and we and accounts deposits demands deposit of maintain consumer variety in The competition. changes and to rates interest operating prevailing on other current and rely our to also on program We primarily marketing goals. active based growth an are and and terms customers competitors deposits. with and by retain relationships and paid rates attract long-standing rates Deposit service, requirements, penalties basis. customer withdrawal liquidity personalized and periodic fees rates, a service market terms, on maturity strategies, our reviewed of pay, all we consisted rates are deposits interest The total organizations. our non-profit and of 22.0% or billion, a $3.36 are 2016 entities. deposits government 31, municipal held local addition, of December from we In certificates deposits At were deposits. 2016, fund balances funds. of public 31, deposit remain certificates of December total brokered We money our source At of brokered of products. are rates. significant million 19.3%, million of or $687.8 interest core $736.8 billion, included source market which $2.95 cost which stable of 2016, in deposit, deposits, lower more 31, changes total December a to of to At represent The 80.7% deposits. mix sensitive deposits representing market accounts). deposits, less attracting core deposit core market be because on in in money deposits may billion focused shift $12.33 core and and one more continuing funds checking attracting from cost a (savings, of strategy low been plan deposits deposit our has core to our efforts on committed revised focused these have one of we to impact years, deposit market several of rates, past certificates interest the prevailing Over by liabilities. influenced of are sources stable and relatively widely be vary can payments competition. can of securities outflows levels and and and conditions loans inflows from flows deposit cash funds, While earnings. retained and eois410532. .5381372. .7330282. 0.71 27.9 3,390,238 0.67 27.5 3,861,317 0.65 27.2 4,150,583 deposits h olwn al esfrhtedsrbto fttldpstacut,b con ye ttedates the at type, account by accounts, deposit total of distribution the forth sets table following The to and training staff branch and platforms technology branches, novo de in invest to continue to intend We market money in changes conditions, economic general by significantly influenced is deposits of flow The owners business mid-sized and small to appeal to designed products, deposit commercial of suite a have We Deposits. tDcme 1 06 ehl 1.8blini oa eois ersnig7.%o u total our of 76.2% representing deposits, total in billion $15.28 held we 2016, 31, December At Balance 2016 Deposits fTotal of Percent Weighted Average Rate 19 Balance Dlasi thousands) in (Dollars tDcme 31, December At 2015 Deposits fTotal of Percent Weighted Average Rate Balance 2014 Deposits fTotal of Percent Weighted Average Rate

FORM 10-K Total 2014 Over Years Three 2015 At Over At December 31, (In thousands) (Dollars in thousands) Three Years Two Years to December 31, 2016 2016 Over Two Years One Year to (Dollars in thousands) 20 Over One Year Six Months to Over Three to Six Months Three Within Months Total $1,938,310 Three months or lessOver three months through sixOver months six months through oneOver year one year 446,897 475,175 $ 254,540 761,698 We borrow directly from the FHLB and various financial institutions. Our FHLB borrowings, Total $2,947,560 $3,416,310 $2,570,338 0.00% - 0.25%0.26% - 0.50%0.51% - 1.00%1.01% - 2.00%2.01% - 3.00%Over 3.00% $ 639,425 $ 194,827 606,970 643,526 1,427,999 $ 304,458 703,630 1,791,549 31,956 384,941 511,058 512,383 9,827 301,930 389,815 386,775 26,462 66,677 Borrowings. The following table sets forth the aggregate amount of outstanding certificates of deposit in amounts greater Total $510,786 $643,102 $712,112 $674,552 $237,506 $169,502 $2,947,560 0.00% - 0.25%0.26% - 0.50%0.51% - 1.00%1.01% - 2.00% $245,6442.01% - $135,462 3.00%Over 3.00% 45,038 $206,213 49,876 $ 154,188 17,677 24,500 169,049 316,340 12,959 $ 38,379 210,713 8,503 254,241 $ 3,081 19,103 301 93,428 84,423 471,009 $ 639,425 4,273 183,506 40,490 1,413 236 1,153 48,715 88,975 1,427,999 561 643,526 69 631 4,661 194,827 12,061 110 31,956 579 9,827 The following table sets forth, by rate category, the remaining period to maturity of certificates of deposit Certificates of Deposits The following table sets forth, by rate category, the amount of certificates of deposit outstanding as of the frequently referred toportfolios as as advances, wellbalances are as and interest over qualified ratesthe collateralized investment on periods our indicated. by securities. advances The our from the following residential FHLB table and and other sets non-residential financial forth instruments mortgage at information the concerning dates and for than or equal to $100,000 and the respective maturity of those certificates as of December 31, 2016. Certificates of Deposits outstanding at December 31, 2016. dates indicated.

FORM 10-K ncieadsbtnilyalast edb h usdaiswr ah eaecretyi h rcs of process the in currently were are inactive. subsidiaries Corporation. We are Estate These which Real cash. Investors subsidiaries Inc. additional were and additional Bancorp, Service Inc. two acquired subsidiaries Services, Federal has Financial Roma the also Investors Bank Brooklyn are Investors by Corp., Bank with subsidiaries subsidiaries. The held merger Investors those Investment assets dissolving the Inc. and or Capital all of liquidating Company, dissolved result substantially Roma being Holding a and of Inc., 3D as process inactive the 2012 and Holding in Investors in Inc. are MNBNY subsidiaries and Mortgage, Agency, dormant subsidiaries: B.F.S. LLC, Home are other that Development Bank Corporation, Investors Investors subsidiaries Way securities. addition, into indirect In My subsidiaries: in and Inc. merged Agency, Inc., invest direct Insurance indirect following Group, to Group Financial the and Financial and 3.93% Investors has and loans Investors its direct Inc. originate Inc., Investors through Realty to public following Commercial, Marathon the markets Investors from the wholesale deposits Corp., 1.50% the attracting has Investment of in business Bank funds the in borrowing Investors is and bank 2.02% network the 1926, branch securities in 3.94% of founded balance Originally the Jersey. 156,120 2016, 2.25% 31, 55,000 December $ 1.60% At securities. 164,415 of preferred $267,681 purpose trust The 250,000 2.16% 2012. sell million. October and $5.0 $167,918 in 192,865 was issue 2.28% Corporation issued Banking to Marathon 267,681 was $156,307 with subsidiary merger the 159,438 this in $154,831 acquired 261,205 and 2.21% 2006 December 153,000 163,000 2.19% 154,831 Activities Subsidiary period during period rate of interest end Average at rate 2.60% interest average end Weighted month any at outstanding Maximum period during balance 1.90% Average period of end at Balance 2.14% 2.19% table following repurchase the to The agreements agreement. underlying under the 1.83% indicated: sold us 2.06% of periods securities securities to period the our resell for The call on and to or rate dates liabilities. agree interest maturity the parties and the at as Those balances at concerning 2,068,006 executed. them reported information is to 2.24% forth portfolio transaction are 1.86% delivered sets $2,650,652 securities each we whom our securities 3,015,058 securities with in $3,099,593 identical party the carried the the be 2,650,652 repurchase to to $2,598,186 securities. 2,548,744 delivered continues pledged to are or agreements agreements 2.12% $3,106,783 obligations transferred the 3,586,000 the underlying the 2,997,873 over securities $4,391,420 control the while effective of 3,230,000 maintain amount we 3,663,087 dollar as The transactions financing 1.79% 3,548,000 as recorded are 4,391,420 period during period rate of interest end Average at rate interest average end Weighted month any at outstanding Maximum period during balance Average period of end at Balance • Bank. Investors II. Bank. Trust Investors Statutory and II Marathon Trust Statutory Marathon subsidiaries: direct two has Inc. Bancorp, Investors agreements These brokers. various and FHLB the with agreements repurchase under funds borrow also We a omdi 01frteproeo rgntn on o aet ohIvsosBn n third and Bank Investors both to the changed sale subsidiary for this Bank, loans Investors of originating rebranding of the with purpose conjunction the in 2011, for During 2001 parties. in formed was Mortgage Home Investors netr aki e esycatrdsvnsbn eduree nSotHls New Hills, Short in headquartered bank savings chartered Jersey New a is Bank Investors aahnSauoyTutI saDlwr tttr rs noprtdin incorporated trust statutory Delaware a is II Trust Statutory Marathon netr oeMrgg saNwJre iie iblt opn that company liability limited Jersey New a is Mortgage Home Investors . 2016 21 2016 to o h erEddDcme 31, December Ended Year the for or At 2015 to o h erEddDcme 31, December Ended Year the for or At 2015 Dlasi thousands) in (Dollars Dlasi thousands) in (Dollars 2014 2014 2013 2013 2012 2012

FORM 10-K Investors Financial Group Insurance Agency, Inc. 22 Investors Financial Group, Inc. is a New Jersey corporation that was Marathon Realty Investors Inc. is a New York corporation established My Way Development LLC is a New Jersey single-member limited Investors Savings Investment Corp. is a New Jersey corporation that was Investors Commercial, Inc. is a New Jersey corporation that was formed in formed in 2004 assecurities such an as, investment but not companyof limited subsidiary. to, deposit, U.S. The Treasury mutual purpose obligations,obtained mortgage-backed of funds, in securities, the this and certificates acquisition subsidiary of equity American is Bancorp securities, to inInvestors May invest Commercial, subject 2009. Inc. in to2010 certain as limitations. an This operatingpurchase subsidiary subsidiary residential of mortgage was loans, Investors commercialin Bank. real New The York estate purpose State. and of multi-family mortgage this loans subsidiaryInvestors primarily is Financial Group, to Inc. originateformed and in 2011 as anto operating process subsidiary sales of of Investorsand non-deposit Bank. consumers investment The as products primary may purpose through be of third referred this by party Investors subsidiaryMy service Bank. is providers Way to Development customers LLC. name it doesHome business under Mortgage from servesnetwork. ISB as Mortgage Investors Co., LLC Bank’s toInvestors retail Investors Investment lending Corp. Home production Mortgage. Investors arm throughout the branch liability company formed in 2001 as a realMarathon estate Realty holding Investors company Inc. for Bank owned real estate. in 2006 and acquiredRealty in Investors the Inc. mergerinvestment operates, with trust Marathon and (“REIT”) Banking is underelection, Corporation taxed, the in Marathon Internal in October Revenue a 2012. Realtydistributed Code to Marathon manner of Investors stockholders, that 1986, provided that Inc. as enables certain amended. REIT it is qualificationInvestors As to tests Financial a not are Group qualify result met. Insurance taxed as of Agency,is this Inc. a a at New real Jersey the licensed estate commissions insurance corporate relating agency formed level to ininsurance, 2016. on fixed the The annuities purpose taxable and sale of indexed this annuities. income of subsidiary certain is to insurance receive products, including, but not limited to, life • • • • • • Our Board of Directors oversees our risk management process, including the bank-wide approach to risk The Bank is continuing to enhance its risk management systems, policies and procedures and has added Enterprise Risk Management Framework management, carried out bystandards our for management. Our themanagement Board of nature approves critical the risks andthe strategic and level plans the ultimate effectiveness and of oversight of theOversight responsibility risk risk policies and management for Compensation that we systems. committees, set the While overseeof are our risk risk the full in willing Board management Board certain meets maintains process, specified toresponsibility quarterly areas. to its assume. and The our committees, Risk Chief provides The Risk Oversightidentify, independent including Officer Committee assess, Board oversight for Audit, manage maintaining of receives Risk and the alloperate Enterprise mitigate risk in reports Risk risks a functions. Management safe in on (“ERM”) Our and the framework sound Board the execution to manner has of in assigned accordance our with strategic the goals Board approved and policies. objectivessignificant and ensure staffing we andprovides governance expertise over risk inproactive policy 2016. and risk risk The escalation. managementtolerance The Bank’s by limits, ERM Management and framework all supports riskline Risk Investors a governance of culture with Bank Committee defense that a structure, Employees, promotes meets threeresponsibility each line a line regularly of for of risk defense and business appetite and model identifying, corporate to framework, function assessing, manage with serve and as managing oversee defined the risk. first risk and In line a of mitigating three defense and risks have in their area. Independent Risk

FORM 10-K r o ersne yacletv agiigui n ecnie u eainhpwt u mlye obe to employees our with relationship our consider we and unit bargaining collective a good. by represented not are Personnel strategic risk, operational Framework compliance risk, cybersecurity, price ERM including risk, The security liquidity activities. information risk. risk, risk, reputational business rate and fraud our interest risk, risk, risk, of supplier credit risk, complexity risks; model the of risk, and categories trajectory following the ensures growth encompasses and size, and defense our of oversight to line appropriate guidance, third effectively. providing functioning the and for as place in serves responsible are Audit systems is Internal and and processes defense. controls, of defense management line risk of appropriate first that line the to second challenge the appropriate as serves Management so eebr3,21,w a ,1 ultm mlye n 8pr-ieepoes h employees The employees. part-time 18 and employees full-time 1,811 had we 2016, 31, December of As is and guidance regulatory and practices industry common with consistent is framework ERM Our 23

FORM 10-K 24 Supervision and Regulation Investors Bank is a New Jersey-chartered savings bank, and its deposit accounts are insured up to applicable As a bank holding company controlling Investors Bank, Investors Bancorp, Inc. is subject to the Bank Any change in such laws and regulations, whether by the Commissioner, the FDIC,We the are Federal unable Reserve to predict these future changes or the effects,The if federal any, government that has these recently implemented changes and could announced have programs on designed the to bolster the capital Federal and state banking laws also require us to take steps to protect consumers. Bank regulatory agencies We have incurred and may in the future incur additional costs in complying with these requirements. General limits by theInvestors Federal Bank is Deposit subject toJersey Insurance extensive Department regulation, Corporation examination of (“FDIC”)non-member and supervision Banking state under by chartered and the the savings CommissionerInvestors Insurance bank, Deposit of Bank by the (the Insurance must the New “Commissioner”) FDIC Fundcondition, file and as reports as (“DIF”). it the must with deposit the obtainor the insurer regulatory issuer acquisitions and approval Commissioner of, prior its of and other to primarythe entering the its depository federal into institutions FDIC FDIC regulator. charter, certain and each concerning transactions, opening and, suchrequirements. conduct its or as as This acquiring periodic mergers activities with, branch regulation examinations and a offices. andsavings financial to The supervision assess Commissioner bank establishes and Investors may aregulatory Bank’s comprehensive structure engage compliance also framework and gives with of theand is various regulatory activities enforcement authorities regulatory activities intended in extensive and which discretion primarily examinationand in a policies, the connection for including establishment with policies of the their adequate with supervisory loan respect protection loss to reserves the of for classification regulatory the of purposes. assets DIF andHolding its Company depositors. Act The ofBoard under 1956, the as BHCA amended andAct”) to (“BHCA”), and the and the provisions the of regulationscompanies. the rules of Investors New and the Jersey Bancorp, regulations Commissioner Bankingregulations Inc. Act under of of, of is the the the 1948 New required Federal Federal (theCommissioner Jersey “New Reserve to Reserve Jersey Board, Banking file conduct Banking the Act Commissioner reports periodic applicablerequirements. and with, to examinations the Investors and bank FDIC. to The Bancorp, otherwise holding regulations Federal assess comply Inc. Reserve of with Board the files and the Company’s the certain the requirements rules of reports compliance Securities NASDAQ. and with, with and and various Exchange otherwise regulatory Commission complies under with, the the rulesBoard federal or and through securities legislation, could lawsand have their a and operations material and adverse stockholders. the impact on listing Investors Bank and Investors Bancorp, Inc. business, revenues, and results of Investors Bank and its subsidiaries. of U.S. banks.regulations on Some us, of some ofeffectively. these which may programs affect the have, way we and conduct our any business future and/or limit programs our ability may,are to compete increasingly impose focusing additional attentioninclude rules disclosures on regarding compliance and truth withregulations, in privacy consumer lending, protection protection truth under the laws inthe Gramm-Leach-Bliley savings and Act and provision of regulations. 1999, funds These andresponsible availability of prohibitions laws for under on interpreting banking various discrimination and in statutesdeposit enforcing services. and accounts a and broad In the range makingdiscussion of addition, of on consumer loans, consumer protection including the protection laws the and regulation governing the Consumer of the role mortgage of provision Financial lending the of and CFPB, servicing. see Protection For “Dodd-Frank further Act.” Bureau (“CFPB”) is

FORM 10-K hc ol aeamtra des feto u uies iaca odto n eut foeain.Thus operations. clients, of current results and maintain business. condition our or on financial clients effect business, meaningful additional a our attract had on not to effect has deposits change adverse the demand material far, on a offer have could currently which we than interest of could institutions financial 2011, 21, July clients. on for beginning compete to result, deposits a demand As on Act. interest Dodd-Frank offering the commence of part as repealed were its governance of a complexity developed has and compliance. and types on-going Rule the and Volcker and meet oversight programs, the funds, appropriate bank control not of ensure the and provisions do to hedge of compliance the program that with size control develop as structures and complied to the securitization has banks for entities Bank asset require appropriate Investors also of oversight, such activities. rules directors’ range The only of a rules). board also final not including but and the in funds, (including in investing criteria equity from companies exemptive private and their and derivatives investment and pools and banks securities exceptions) unregistered commodity certain in to trading certain (subject proprietary prohibits short-term sponsoring Rule in Volcker engaging The Act. from Dodd-Frank affiliates the process of part process testing as the enacted stress from the value related shareholder evolve, the maximize to As to continue conditions. ways seek size testing economic requirements. stress to Investors’ severe regulatory The continue with under of 2016. we complying while 25, even banks and the October investment capital, for on to significant Bank’s practices results as requires the test best updates stress of and regular updated results adequacy tests methodologies published receives stress the and its Directors required, submitted affirmed with of Bank as along results The Board 2016, requirement. Management, 31, The regulatory Risk this July process. with and by complying this Management in in challenges Senior and assist Directors, progress who of the consultants Board on regarding the third-party scenarios rule involves stress final which of a impact requirements, issued quarterly FDIC the to the assess banks 2012, to require October rule quarters. the In also nine to of tests. regulations horizon subject stress a The bank over the capital a adverse. bank’s of requiring severely results tests different and the stress three least annual of adverse, at summary for baseline, regulatory provide a including financial that publish federal testing conditions, with stress coordination for of in methodologies federal FDIC, sets establishing the regulations the required issue also authorized to Act agencies, Dodd-Frank Act The tests. Dodd-Frank stress the annual costs. operational addition, imposing Bank’s the include In increase could could Bank. which which fees, the action, and to responsive of assessments latitude new take additional activities various and FDIC, impose business the to system regulators and financial the Reserve the Federal on by of the restrictions as activities safety hybrid such Dodd-Frank other systemic of The agencies, and the use trading. regulatory proprietary investments the monitor bank and on on federal activities gave limitations restrictions derivatives also and to new Dodd- Act respect limits imposed the with leverage also of particularly supervision, capital, Act institutions, provisions the to depository enhanced Dodd-Frank capital Under changes implement The The Bank. things, institutions. instruments. and the other depository capital draft of among for to include, operations standards required Act the liquidity Frank are impact continue and will to agencies capital Act likely that regulatory and Dodd-Frank are actions examination bank The and regulatory firms. federal resulted and services have Act, legislative that financial Dodd-Frank additional studies regulating in multiple laws mandated result the and to to rulemaking changes significant extensive required made also 2010, 21, July on Act Dodd-Frank u neetepnewl nraeadorntitrs agnwl eraei ehv oofrhge rates higher offer to have we if decrease will margin interest net our and increase will expense accounts interest deposit Our demand on interest pay to institutions financial of ability the on prohibitions federal All Rule” “Volcker the implementing rule final a adopted regulators federal 2013 December in addition, In testing stress the with comply to process comprehensive and repeatable a developed has Bank The conduct to billion $10 than more of assets consolidated total with banks required Act Dodd-Frank The law into signed Act”), “Dodd-Frank (the Act Protection Consumer and Reform Street Wall Dodd-Frank The 25

FORM 10-K 26 Investors Bank derives its lending, investment and other powers primarily from the state and local governments and agencies; • real• estate mortgages; consumer• and commercial loans; specific types of debt securities, including certain corporate debt securities and obligations of federal, The Dodd-Frank Act also established the new federal CFPB. This agency is responsible for interpreting and In accordance with deadlines set by the Dodd-Frank Act, the CFPB issued final rules in January 2013 Additionally the CFPB has the authority to take enforcement action against banks and other financial In addition to creating the CFPB, the Dodd-Frank Act, among other things, directed changes in the way that Activity Powers. applicable provisions ofregulations, savings the banks, including Investors New Bank, generally Jersey may invest Banking in: Act and its related regulations. Under these laws and enforcing a broadprovision range of of consumer depositservicing. protection accounts This includes laws and laws (“FederalSavings such the Act, Consumer as making the the Financial Home Equal ofOpportunity Laws”) Mortgage Credit Act, loans, that Disclosure Opportunity and Act, govern Act, including theconnection the the the with the Fair Real Truth mortgage in Estate Credit regulation origination Lending Settlement that ReportingProcedures of Act, Procedures incorporates Act Act. the and disclosure Act, mortgage the In Truth requirements the Truth-in-Lending lending under in 2012,December Equal Act. the 2013, The the and Credit and Real CFPB the CFPB Estate issued disclosure Settlement a proposed requirement final became an rule effective regarding integrated in the October disclosure integrated 2015. disclosure in in related to newmortgage” mortgage which servicing will fulfill standards,ability the to and Dodd-Frank repay. Act mortgage These requirementCFPB mortgage lending that regulations servicing requirements mortgages will and be increase lending thatprovide provided the rules consumer establish to Bank’s became financial borrowers compliance effective products. a in expenses, with “qualified January and an 2014. limit These the and terms other under which the Bankservices can companies that fail toassets satisfy of the more standards than imposedFederal by $10 Consumer it. Financial billion, As Laws. the an Thelaws Bank insured Dodd-Frank and depository is Act institution state also subject with permits attorneys toaspects total states general of CFPB to to the supervision adopt Dodd-Frank enforce stricter and Act,certain. consumer consumer examination the protection protection Bank of Therefore, rules is compliance operating the issuedincluding with in by Bank a but the consumer is CFPB. compliance not environment Asactions likely limited that a and will to to result be consumer-oriented potential of far incurprotection litigation, less these costs provisions additional of which associated the costs is Dodd-Frank with Act. likely related CFPB to to examinations, continue regulatory consumer to and protection increase enforcement compliance, asinstitutions a are result ofrequirements assessed on the holding for consumer companies, requiredthe deposit originators transferred of loans, insurance, securitized imposed loans regulatoryon to mandated rate-setting retain for a the the certain percentage debit oforiginations. payment imposition the card At risk interchange this of for fees, of time, repealed itresulting restrictions interest continues tougher regulations to will be on consolidated difficult impactregulations to the commercial capital predict could Bank’s the result business. demand full However, extent incontinuing to compliance deposits restraints impact which with the the on, certain and Dodd-Frank Dodd-Frank and of Actwhole. Act additional or these required will In the costs new have laws reforms to, addition onindustry and our our to factors related business. competitors could the It and to also continuingour on is adversely liquidity. the also mortgage legislative impact financial difficult our and services to results, industry regulatory predict the as the initiatives cost a of described our above, operations,New our Jersey competitive Banking financial and Regulation condition and

FORM 10-K tchles qiyadrtie anns ir1cptli eeal eie scmo qiyTe and 1 Tier and equity stock common preferred perpetual as noncumulative defined certain generally includes capital is 1 capital Tier 1 Banking Additional capital. Tier on 1 earnings. Tier retained additional Committee and Basel equity stockholders’ the assets rule of total final to a recommendations of capital result 1 Act. the Dodd-Frank Tier on the are 4% of and a based requirements 2015 to and certain 1, capital and 8%, amendments 1 January Supervision of Tier effective assets a regulatory were risk-based 4.5%, requirements to of capital implementing ratio capital existing assets total The risk-based a ratio. to 6.0%, leverage capital of 1 ratio Tier assets equity risk-based common a standards: capital minimum may Commissioner conditions. certain The Regulation under removed. Banking bank Federal saving be show Jersey not to New should a terminated, for person be conservator or such to or law why receiver activity of bank of Commissioner the appointment savings ordered the violation the a seek has before any of also Commissioner employee hearing discontinue or the a to attorney after at officer, bank activity, director, cause savings objectionable any least direct any an at may in Bank order and engaged Investors may practice, examines business Commissioner unsound Department The or The unsafe years. advisable. two examination an every deems once it whenever Bank on Investors imposed those below. to Requirements” Capital similar — Regulation requirements Banking capital Federal “— minimum See the banks. Bank, state of Investors insured payment by including paid the institutions, be alternatively, may depository or that dividends stock, below. of capital Action” amount Corrective its the Prompt of limit — payment also Regulation 50% the Banking may than after Federal law would, “— less Federal savings bank See the surplus. not savings Bank. of the Investors the of stock unless reduce capital surplus dividend not the a a would impair pay dividend have not not would dividend, may dividend bank the the savings of of stock payment a the addition, that In an extent bank. the in to borrower only stock the additional capital Act an to Banking Jersey limitations. lend related New loans-to-one-borrower may the applicable entities bank of with to requirements complies savings the currently or A Bank meeting Investors funds. collateral borrower Act. by capital single Bank secured bank’s National if a the the funds and to capital of bank’s credit 15% the of exceed extend 10% would or that loans amount make aggregate not may by bank Restrictions Commissioner Activity the — Regulation by Banking powers “Federal approval activity See and prior regulations. investment for related lending, privilege, below. the these authorized Banks” or and State-Chartered of law privileges on exercise benefit federal The or provided by required. right, associations, limited is Commissioner. benefits savings power, are authorization the or rights, specific such banks by of savings powers, or any out-of-state approval FDIC. regulation those or exercising upon of the federal exercise for before powers amounts by or may aggregate that trust banks imposed and out-of-state banks exercise or restrictions individual savings also banks the certain national may Jersey on to bank limitations New subject of savings Lastly, number Act, A a Banking investments. with Jersey “leeway” comply must New investments the “Leeway” by permitted otherwise aig akmyas aeivsmnsprun oa“ewy oe,wihprisivsmnsnot investments permits which power, “leeway” a to pursuant investments make also may bank savings A assets. other certain and securities; equity corporate of types • certain • o h upsso h aia tnad,cmo qiyTe aia sgnrlydfnda common as defined generally is capital 1 Tier equity common standards, capital the of purposes the For Requirements. Capital Enforcement. and Examination Requirements. Capital Minimum Dividends. Limitations. Loans-to-One-Borrower ne h e esyBnigAt tc aig akmydcaeadpyadvdn nits on dividend a pay and declare may bank savings stock a Act, Banking Jersey New the Under eea euain eur DCisrddpstr ntttost etseveral meet to institutions depository FDIC-insured require regulations Federal h e esyDprmn fBnigadIsrnemyexamine may Insurance and Banking of Department Jersey New The euain fteCmisoe moeo e Jersey-chartered New on impose Commissioner the of Regulations ihcranseiidecpin,aNwJre-hree savings Jersey-chartered New a exceptions, specified certain With 27

FORM 10-K 28 In determining the amount of risk-weighted assets for purposes of calculating risk-based capital ratios, all In addition to establishing the minimum regulatory capital requirements, the regulations limit capital In assessing an institution’s capital adequacy, the FDIC takes into consideration, not onlyThe federal these banking numeric agencies, including the FDIC, have also adopted regulations to require an assessment of • the• quality of the bank’s interest rate risk the• management overall process; financial condition of the bank; and the level of other risks at the bank for which capital is needed. related surplus and minority interestscapital in equity (common accounts of equity consolidatedcomprised subsidiaries. Tier Total of capital 1 includescumulative Tier capital capital 1 plus instruments preferred additionalintermediate and stock preferred Tier stock related 1 and andlease subordinated capital) surplus, debt. losses long-term Also and limited meeting included to Tier inopt-out perpetual a specified Tier election 2 maximum 2 regarding of preferred capital requirements, capital. the 1.25% isnet treatment Tier of the and of stock, allowance risk-weighted unrealized Accumulated 2 for assets may Other loan mandatory gainsInstitutions capital and, Comprehensive and that include for Income is have on convertible institutions (“AOCI”), not up that exercised available-for-sale(including to have the securities, 45% unrealized AOCI exercised equity opt-out of an gains have securitiescapital AOCI and is incorporated subject losses with into to common on deductions equity readily and available-for-sale-securities). Tier adjustments 1 determinable specified Calculation capital in of fair the regulations. all market types values. ofassets, regulatory including certaininterests) off-balance are multiplied sheet by assets athe risk (e.g., type weight factor recourse of assigned asset. obligations, byexample, the Higher direct a regulations levels based credit risk of ongenerally substitutes, the capital weight risks assigned are residual believed of to required inherent prudently 0% in for underwritten100% is asset is first assigned lien categories assigned to one believed commercial to toand to and four- cash a present consumer family loans, greater residential and risk a mortgages, risk.specified U.S. weight risk a factors. For weight risk government of of weight securities, between 150% of is 0% a assigned to to risk certain 600% weight past due is of loans assigned 50% todistributions is and permissible certain equity discretionaryconservation interests, bonus buffer” payments consisting depending to of on management 2.5%necessary of if certain to common the equity meet institution Tier its does 1being capital minimum not phased to hold in risk-based risk-weighted beginning a capital asset January “capital implemented above requirements. 1, at the 2016 The 2.5% amount at on capital 0.625% January conservation of 1, 2019. buffer risk-weighted assets requirement and is increasing each year until fully factors, but qualitativeindividual institutions factors where deemed as necessary. well, and has thean authority institution’s to exposure to establishwhen declines assessing higher in the the bank’s capitalfor capital economic requirements interest adequacy. value Under of rate for suchInstitutions a risk a bank’s with on risk capital assessment, a significant dueagencies, examiners case-by-case to applicable interest evaluate considerations changes basis, a include: rate in bank’s with risk interest capital consideration rates may of be both required quantitative and to qualitative hold factors. additional capital. According to the

FORM 10-K rmrl o ebrtrf ntttosa ela te niisivle nhm otaelnig ti funded is It facility the lending. credit mortgage by central home regulation in a involved and provide entities supervision Banks other to as Loan well subject Home as each Federal institutions Banks, thrift The member Loan (“FHFA”). for Home Agency primarily Federal Finance regional Housing the Federal of establish activities. consists to such in necessary which engage conditions to activities chosen all in not meets engage has may it Bank subsidiaries, and State- Investors financial 2000 subsidiary. Although through 11, activities financial law. March permitted the federal in of and in engage under as from risk and earnings, authorized existence exclude such retained in not must from including subsidiaries and are bank retain investments, bank’s that must may the equity the bank banks with all The protect savings assets billion. equity and chartered subsidiary’s $50 and risk or financial assets subsidiary’s assets the insurance own financial total consolidate than its bank’s the not such the other assess must all of liability, to company of 45% conduct, potential assets procedures holding of total to and lesser and The financial well-managed the policies banking. terms a exceed and have merchant same not or for well-capitalized the may development is permitted subsidiaries estate substantially that financial real activity on or bank and any investments national insurance subsidiary subsidiary, a underwriting, financial financial permits a a law through the through engage general, may In bank for conditions. national permitted a activities which in bank in engaged the are restrictions. unless additional that significant activity to subsidiaries a subject the present are of approve subsidiary” not activities “financial does not Certain a activity will through funds. the only FDIC that insurance banks determines national The FDIC FDIC activity. the FDIC the the such to and from requirements risk in approval capital seek engage minimum must or its bank insured meets investment an such regulations, FDIC make or to law federal under permissible otherwise or law by exempted for specifically permissible are those investments to and subsidiaries FDIC. activities the their such by and unless to subsidiaries, banks consented their insured and FDIC banks state-chartered national of investments and activities In assets. average total adjusted regulations. on applicable based are assets ratio, leverage 1 Tier calculating of purposes For (1) 2016: 31, December of as ratios capital risk-based Total and capital risk-based 1 Tier capital, based h olwn al hw h akadteCmaysTe eeaerto omnEut ir1risk- 1 Tier Equity Common ratio, leverage 1 Tier Company’s the and Bank the shows table following The eea oeLa akSystem. Bank Loan Home Federal activity any in subsidiaries, financial through engage, to bank savings state-chartered a permits law Federal or bank national a for permissible not is that activity new a in engaging or investment new a making Before under capitalized” “well considered Banks. were State-Chartered Company on the Restrictions and Activity Bank the both risk-weighted 2016, total 31, on based December are of assets As capital, risk-based Total and capital risk-based assets. 1 Tier calculating oa ikBsdCptl3259817.75 16.52 3,295,948 13.48% 3,066,401 $3,066,401 15.99 14.75 2,965,720 16.52 12.03% 2,736,173 3,066,401 $2,736,173 14.75 Capital Risk-Based Total 2,736,173 Capital Risk-Based 1 Capital Tier Risk-Based 1 Tier Equity Common Ratio Leverage 1 Tier Inc.: Bancorp, Investors Capital Risk-Based Total Capital Risk-Based 1 Capital Tier Risk-Based 1 Tier Equity Common Ratio Leverage 1 Tier Bank: netr aki ebro h eea oeLa aksystem, Bank Loan Home Federal the of member a is Bank Investors 29 eea a n DCrgltosgnrlylmtthe limit generally regulations FDIC and law Federal so eebr3,2016(1) 31, December of As Amount Dlasi thousands) in (Dollars Ratio

FORM 10-K 30 Pursuant to the requirements of FDICIA, as amended by the Riegle Federal law establishes a prompt corrective action framework to resolve the The FDIC has extensive enforcement authority over insured savings banks, including In addition, the FDIC adopted regulations to require a savings bank that is given notice by the FDIC that it is Enforcement. Prompt Corrective Action. Investors Bank, as a member of the FHLB of New York is currently required to acquire and hold shares of Safety and Soundness Standards. Community Development and Regulatory ImprovementFDIC, Act of has 1994, adopted eachinformation federal guidelines and banking agency, internal establishing includinggrowth, audit the general asset systems, quality, standards loan earningsother documentation, relating and things, credit compensation, appropriate to underwriting, systems feesguidelines. matters and interest and The practices such benefits. rate to guidelines In exposure, ascompensation identify prohibit general, as asset and internal excessive the excessive manage when guidelines controls, the the compensationby require, amounts risks an as paid among executive and are officer, an unreasonable exposures employee, or unsafe specified director, disproportionate or in to and principal the the stockholder. unsound services performed practice and describe not satisfying any of suchso safety and notified, soundness standards a toimplement savings submit an a bank compliance accepted fails plan compliance tothe to plan, the types FDIC. the submit If, FDIC to after an mayprovisions which being acceptable issue of a an FDICIA. compliance significantly If order plan aan directing undercapitalized order or savings corrective institution in bank fails and judicial is fails proceedings other in to and subject actions comply any to under of impose with material civil such the monetary respect an “prompt penalties. order, to corrective the FDIC action” mayInvestors seek Bank. to enforce This such penalties, enforcement to authority issue cease includes,actions may and among be desist initiated other in orders response things, and to violations to the of remove laws ability and directors regulations to and and assess to officers. unsafe In civil or unsound general, money practices. these enforcement primarily from proceeds derived fromFederal the Home sale Loan of Banks consolidatedincluding make obligations collateral loans of the requirements, to Federal members establishedBanks. Home (i.e., by Loan These advances) the Banks. policies in The respective accordance andadvances Boards with are procedures of policies required are Directors to and subject of provideof procedures, community funds to the or for Federal the investment residential service Home regulation home that Loan and financing. members must The oversight meet FHFA of to has maintain the also access established FHFA. to standards such All long-termFHLB long-term advances. Class B stock.notice, The subject Class to B certainrequirements conditions. stock The has and Class a the B parrequirement stock other in value has the of for FHLB two $100 Class subclasses,an activity-based B per one annual stock stock share for basis is the and membership at purchase sumon the stock is of requirements. a end purchase redeemable the daily of membership The upon basis. each stock five ForAssets, minimum purchase calendar Investors years requirement, as year, stock Bank, determined defined and on the investment by the membershipsecurities, the activity-based stock including FHLB, stock CMOs, purchase which purchase held requirement consists by requirement, isBank Investors determined principally 0.15% is Bank. of of equal The Mortgage-Related residential to activity-basedprincipal mortgage the stock balance sum purchase loans of requirement of: and Acquired for (1) mortgage-backed MemberMember Investors 4.50% Assets, Assets; of as (3) outstanding a defined specified borrowing byis dollar the from zero; amount FHLB, the and related and FHLB; to (4) delivery (2) certainof a commitments off-balance 4.50% derivative specified for sheet contracts of percentage Acquired items, between the ranging which the outstanding adjust for from FHLB Investors the 0% and Bank specified its to members, percentages 5% which andcapital of for dollar the Investors plan. amount carrying Bank from is value At timerequirements. also on zero. to the December The time FHLB FHLB within balance can 31, the sheet ranges 2016, established by the the FHLB amount of FHLB stock held by Investors Bank satisfies these problems of undercapitalized institutions. Theaction FDIC legislation. has adopted Those regulationsmentioned to regulations increased implement regulatory were the capital prompt amended standards corrective that effective were January effective 1, on the 2015 same to date. An incorporate institution the is deemed previously

FORM 10-K naeo non rcie,i na naeo non odto ocniu prtoso a iltdany violated has or operations continue to condition unsound for or unsafe responsible an be in more is or practices, unsound billion or $10 unsafe of assets 1.35%. a to with 1.35% 1.15% implements reaches from and institutions ratio ratio 2016 reserve that 1, Fund Fund July Insurance Insurance Act effective Deposit Deposit became Dodd-Frank the the rule increasing October with This until the institutions In quarters). exist on of calendar formula. surcharge would eight point assessment surcharge requirement as basis bank The estimates 4.5 a FDIC large more. annual issued the an or its (which FDIC impose billion refined would the $10 that and 2012, rule of clarified certain proposed October assets a to which In issued subject 2013, FDIC rate, assessments. 1, the assessment the higher 2015, an March to to paying loss effective converted potential riskier rule, is modeling, score deemed on final total based institutions certain The measure, failed. to with including large designed institution scorecard measures, adjustments, is the detailed 2011, which risk if more score, fund forward-looking in severity a insurance using loss upon FDIC beginning a determined based (ii) assessment score However, and to testing, performance by subject adjustments. stress a by determined became (i) specified classification assets) presented involving risk in certain risk a more approach the on the billion and time, based $10 purposes, same ratios assessed (i.e., now the assessment are institutions At it financial banks for capital. that Small tangible ratings, evaluating, Bank. so less to Investors examination assets schedule as approach total assessment such rule average comprehensive institutions its final of more larger points a adjusted basis issued a and 45 FDIC to adopted 2011 to The procedures FDIC points 1, deposits. its basis than April institutions 2.5 revise rather with effective from to capital, institution, ranges directive FDIC tangible the that the less of assets required implemented fund total Act which insurance average Dodd-Frank the on The to assessments assessments. risk base higher perceived paying the riskiest on each deemed based for is $250,000 of assessment maximum institution’s a to up FDIC, the by insured are Bank depositor. Investors insured in separately accounts Deposit FDIC. the regulations. FDIC with a 2016. a capital 31, of of December issuance one on “significantly any the directors. undercapitalized,” take and including restrictions officers also is institutions, executive as may senior undercapitalized it of FDIC replacement against that such The the actions and notice institutions. directive the supervisory restrictions, capital “undercapitalized” receives with discretionary to bank filed Various of apply be savings number also must undercapitalized.” a growth, plan date “critically restoration and “critically capital distributions the be a or of to that days provide considered “undercapitalized” also 45 is regulations within The institution FDIC frames. or An time to than specific equal 3.0%. is less within that of than assets ratio total less to leverage regulations) a of the 4.0%, in ratio defined than 1 (as less 1 equity Tier of tangible equity 2.0%. risk-based of Tier ratio than common total ratio less capital a a a equity has has risk-based or it it common 1 4.0% if if Tier a than undercapitalized” of undercapitalized” a 8.0%, a less “significantly ratio than 6.0%, or of be 1 less to than ratio Tier 3.0% of deemed less leverage equity ratio is of a common capital institution 6.0%, ratio a An risk-based than capital 4.5%. and total than less greater a risk- less of or has 1 of Tier ratio it 4.0% greater. ratio a or if capital of capital greater, 6.5% “undercapitalized” risk-based ratio risk-based or of is 1 leverage 8.0% 1 ratio institution of Tier a 1 Tier ratio An Tier greater, a capital greater. equity or greater, risk-based or common 6.0% total or a 4.5% a of and 10.0% has ratio greater of it or capital ratio if 5.0% based capitalized” capital of “adequately ratio risk-based is leverage total institution a a An greater, has or 8.0% it of if ratio capitalized” “well be to nuac fdpst a etriae yteFI pnafnigta nisiuinhseggdin engaged has institution an that finding a upon FDIC the by terminated be may deposits of Insurance Each institutions. depository insured all against insurance deposit for assessment an imposes FDIC The Insurance. Deposit of as framework action corrective Liquidity. prompt the under “well-capitalized” as classified was Bank Investors “undercapitalized” “critically is that institution an for appointed be must conservator or receiver a Generally netr akmitissfiin iudt oesr t aeadsudoeain naccordance in operation, sound and safe its ensure to liquidity sufficient maintains Bank Investors netr aki ebro h eoi nuac ud hc samnsee by administered is which Fund, Insurance Deposit the of member a is Bank Investors 31

FORM 10-K 32 Transactions between an insured bank, such as Investors Banks are subject to the prohibitions of 12 U.S.C. Section 1972 FDIC regulations require Investors Bank to disclose its privacy policy, including affiliate to an amountsuch equal transactions to 10% withearnings; of all and such affiliates bank’s to capital stock an and amount retained equal earnings, and to limits 20% all of such capital stock and retained Privacy Standards. Investors Bank is also required to provide its customers with the ability toIn “opt-out” addition, of in having accordance Investors with the Fair Credit Reporting Act, Investors Bank must provideThe its FDIC customers and other federal banking agencies adopted guidelines establishing standards for safeguarding In addition to the FDIC assessments, the Financing Corporation is authorized to impose and collect, with the Transactions with Affiliates of Investors Bank. Section 23A: • limits the extent to which a bank or its subsidiaries may engage in “covered• transactions” with any one requires that allThe such term transactions be “covered on transaction” terms includes that the are making consistent of with loans, safe purchase and of sound assets, banking issuance practices. of guarantees and Prohibitions Against Tying Arrangements. on certain tyingextending credit arrangements. to A orcredit depository offering or any service, institution other onaffiliates is or service, the not prohibited, or condition obtain services fixing that subject of or the a to competitor varying customer of the obtain specific the institution. consideration some exceptions, for additional from such serviceidentifying extension from with of the whom it institutioncustomer shares or relationship “non-public and its personal annually thereafter. information,” to customers at the time of establishingBank the share theirinformation, non-public subject to personal certain exceptions. information with unaffiliated third parties beforewith the it ability can topurposes “opt-out” disclose with of an such having affiliate Investors or Bank subsidiary share before it their can non-public disclose personal such information information. for marketing customer information. The guidelinesmaintenance describe the of agencies’safeguards an expectations appropriate for to information the the size creation, security and implementation complexity and of program, the institution which and the includes nature and scope administrative, of its technical activities. The and physical applicable law, regulation, rule,practice, condition order or violation or that condition may lead imposed to by termination of the our FDIC. deposit insurance. We areapproval of not the currently FDIC, assessments awarethe for of anticipated FICO payments, any in issuance the costsissued and 1980s by custodial to fees the on recapitalizeannualized bonds FICO the issued Financing are by former Corporation due Federal assessmentcapital. to was Savings equal mature and to Loan in 0.56 Insurance 2017 basis Corporation. points through of The 2019. total bonds For average assets the less quarter tangible ended December 31, 2016, the Bank, and anyimplementing regulations. of An its affiliateunder common affiliates of control a with are bank thefinancial bank. governed is subsidiary Generally, is any a by not company subsidiary treated of as Sections or an a entity affiliate bank 23A of that that the is and controls, bank not for is also 23B purposes a controlled of depository of Sections by institution 23A or the or and is 23B. Federal Reserve Act and other similar typescollateral of in transactions. amounts Further, ranging frombank most 100% with loans to an 130% affiliate by of andsubstantially a the any the loan purchase bank same, amounts. of or to assets In at or addition, least any services any as of by favorable covered to a its transaction the bank by affiliates bank, from a as an must those affiliate that be must would be secured be on provided by terms to that a are non-affiliate.

FORM 10-K akta swdl vial oepoeso h akadta osntgv n rfrnet nieso the of insiders to preference any give not of does plan that compensation and or bank benefit with bank. the a transactions the of to comparable of employees pursuant employees for to made other time available over credit the bank widely of at is extensions prevailing that for are bank made the that a is those (2) exception than, An or any stringent persons. $500,000 less other with not (1) are aggregated either that when procedures exceed loan, would surplus. such interests, and if capital related the unimpaired voting, of insider’s bank’s directors the the the of of board 5% and in the or of $25,000 insider participating to majority of that loan a greater not by proposed $25,000 to advance directors any of in loans that greater interested approved requires existing the be also any (2) insider regulation certain that or with of Federal and $100,000 interest surplus. (1) children bank, related and of officer’s certain a capital lesser the or With unimpaired the insider of related surplus. exceed bank’s an education insiders’ not the unimpaired the may of and and for residence, 2.5% insiders loans capital officer’s or than Banking unimpaired all the other by bank’s Jersey to officer, secured the New bank executive loans exceed “— an a not to See by loans may Bank. loans exceptions, aggregate Investors All the to Limitations.” in which and applicable Borrower interests banks, insider national limit Loans-to-One any to to loans-to-one-borrower — applicable loans limit the Regulation the loans-to-one-borrower insider’s to Act of the (an Reserve exceed amount comparable persons Federal not aggregate such the is may any the of interests with 22(h) restrictions, related Section affiliated these insider’s by entities Under the imposed certain regulations. limitations of and implementing any conditions its and the and stock) to its subject are of interest) more related or 10% of owner (any Insiders well Bank’s as a FDIC, to the Loans by the actions Justice. with enforcement of comply in Department to result the failure could and The agencies Act statutes. regulatory Housing those federal Fair in other the specified as and characteristics Act of Opportunity basis Credit the Equal on publicly- practices recent lending their most in our in 2014. rating August in CRA FDIC “satisfactory” the by a conducted received was which Bank evaluation, Investors federal available activities. its on restrictions of record three its institution’s on on the focuses based system assess institution evaluation an to current rates the required regulations particular, its is CRA In with current FDIC needs. the community connection their the tests: things, meeting of In bank, other in needs performance Among neighborhoods. savings credit actual CRA. the and chartered the meet state with individuals help compliance a to moderate-income regulations of and related examination low- and (CRA) including Act communities, Reinvestment Community the harm substantial under in result could that and records information records such or customer of records of integrity such customer. confidentiality or of any security and use to the or security inconvenience to to or the hazards access insure or unauthorized threats to against anticipated intended protect any are against guidelines protect information, the and in forth set standards eeal,last niesms emd nsbtnilytesm em s n olwcei underwriting credit follow and as, terms same the substantially on made be must insiders to loans Generally, Regulation. Federal discriminating from lenders prohibit Act Housing Fair the and Act Opportunity Credit Equal the regulatory addition, in In result minimum, a at other could, and CRA ATMs the of branches, provisions its the through with services comply of to delivery failure institution’s institution’s An the evaluate to test, service a projects, development community in • investing of record areas; institution’s service the its evaluate in to loans test, making of investment record an institution’s the evaluate to test, lending • a • Laws. Lending Fair and Act Reinvestment Community offices. tracts census and/or individuals income moderate or and low businesses; benefiting and programs and housing, affordable akslast t nies—eeuieofcr,drcos rnia shareholders principal directors, officers, executive — insiders its to loans bank’s A 33 l DCisrdisiuin aearesponsibility a have institutions FDIC-insured All

FORM 10-K 34 The New Jersey Banking Act imposes conditions and limitations on loans and internal controls; the appointment ofprogram; an and anti-money independent laundering testing; compliance officer; an effective training and prevention of money laundering and terrorist financing activities; customers seeking toreasonable period open of time; new accounts, including verifying thereport money-laundering, identity terrorist financing of and other customers suspicious activity; within a Under Federal Reserve Board regulations, Investors Bank is required to maintain non-interest earning Investors Bank is subject to FDIC regulations implementing the Uniting and Strengthening America by Title III of the USA PATRIOT Act and• the related FDIC regulations require the: Establishment of anti-money laundering compliance programs that includes• policies, procedures, and Making of certain reports to• FinCEN and law enforcement that are Establishment designated of to a assist in program the specifying detection procedures for obtaining• and maintaining certain records from Establishment of enhanced due diligence policies, procedures and controls designed to detect and In addition, federal law prohibits extensions of credit to a bank’s insiders and their related interests by any Extensions of credit to a savings bank’s executive officers are subject to specific limits based on the typeNew of Jersey Regulation. extensions of credit tocontrolled directors by such and persons, executive whichthe officers are loans and comparable of extensions in a of manyNew credit savings respects Jersey to bank to Banking insiders the Act and and conditions also their toin and provides related compliance corporations limitations that interests with a imposed and under such savings on federal provisions partnerships bank law, of that as the discussed is New above. Jersey in The Banking compliance Act. with federalFederal law Reserve is System deemed to be reserves against its transactionof accounts. 3% The must Federal be Reserveand maintained Board against 10% regulations aggregate generally against$15.5 transaction require million accounts that that of over reserves otherwise $15.5 portion reservablecompliance million balances with of and are these exempted up total from requirements. toRequired the $115.1 These reserves transaction reserve million, must requirements requirements. accounts be Investors areReserve maintained Bank Bank; adjusted in is or in annually in a excess the pass-through by form account of the of as defined Federal vault up by Reserve cash the and/or to Federal Board. Reserve anAnti-Money Board. $115.1 interest Laundering and bearing million. Customer account Identification The at a first Federal Providing Appropriate Tools RequiredAct. to The Intercept USA and PATRIOT Obstruct Actdomestic Terrorism gives security Act the measures, federal of expanded government 2001,money surveillance powers or to laundering powers, the address increased USA requirements. terroristPATRIOT PATRIOT information threats Act By sharing, through contains enhanced and way broadenedenforcement measures of anti- agencies. intended Further, amendments to certainfinancial encourage provisions to of institutions, information Title the including sharing III banks,registered Bank among impose thrifts, under affirmative bank the brokers, Secrecy obligations Commodity regulatory dealers, on Exchange Act, credit and a Act. unions, broad Title law range money III of transfer agents of and the parties USA other institution that has asubstantially correspondent the banking relationship same with terms thedoes as not bank, those involve unless more such prevailing than extension at the of the normal credit risk is time of on for repayment comparable or present transactions other with unfavorable other features. loans persons involved. and Generally, loansprimary residence are and limited education loans to for $100,000, the officer’s except children. for a mortgage loan secured by the officer’s

FORM 10-K cetbecptlrsoainpa rfist mlmn nacpe ln h eea eev or may Board Reserve Federal the plan, accepted an file an to implement fails bank to undercapitalized fails an bank. or If undercapitalized Action.” plan an the Corrective of restoration of required Prompt be is would — capital provisions that bank The Regulation action acceptable plan subsidiary manner. Banking restoration corrective undercapitalized unsound Federal capital an prompt or “— the of unsafe the See limitations, parent an within company Under in guarantee, holding policy. activities to bank strength directed its a Act, conduct of Insurance not source Deposit must the Federal and codified banks subsidiary Act Capital its Dodd-Frank of — any Regulation regulatory to strength Inc.’s Banking Bancorp, “Federal Investors See 2016, 31, requirements. December capital of are minimum As Inc. Bank. these Bancorp, 2015, the Investors Requirements.” 1, exceeded to to January less ratios applicable effective applying of capital, requirements those companies capital preferred regulatory capital holding to grandfathered on trust The bank rules identical Act all directive. as final now and Act Dodd-Frank referenced such companies Dodd-Frank previously The holding capital, The the mutual companies. assets. implemented 1 by in holding 2010 tier billion 19, bank $15 from May the than for things, to instruments other includable prior certain Among issued previously themselves. instruments of quantitatively institutions were both inclusion to that stringent, applicable the those less securities, than eliminated no capital, are Act of that components Dodd-Frank consolidated companies of promulgate to holding terms the Board in institution Reserve by and Federal depository requirements administered the adequacy for required as capital requirements Act Act, consolidated Dodd-Frank capital The imposed Company companies. regulations Holding holding Board Bank bank Reserve on the Federal under Board. reporting Reserve Federal periodic and regulation examination, Regulation Company Compliance risk Holding its a enhanced increased establish has and technology Bank its to improved strengthen Investors personnel. lines, and to controls. senior reporting Bank hiring and restructured compliance including Investors to through staff, procedures by AML programs agreed commenced policies, compliance also or and practices, and taken Bank and management compliance BSA been Investors AML system; have BSA. for actions and compliance BSA; to Numerous BSA accounts Board. with automated relating the compliance and programs BSA/AML of full training Committee transactions Bank’s ensure effective Bank to Investors to; certain implement to designed agreed of and review controls regard Bank adopt validation internal with Investors develop, comprehensive of (“NJDOBI”) matters. 3) system a Insurance compliance a and conduct implement (“AML”) Banking 2) and Laundering of adopt Anti-Money Department develop, and Jersey 1) (“BSA”) New the Act and and Secrecy policies FDIC adopted the has with Bank Investors activities. laundering In engaging requirements. institutions money financial requirements. these combating these of with with in effectiveness comply non-compliance the to transaction for procedures consider merger must institution other agencies a financial as regulatory a in well bank as on federal fines, imposed the and be addition, penalties Significant may institutions. orders financial supervisory by maintained programs laundering money banks. when applications. foreign laundering Act money of Merger combating Bank accounts in and effectiveness correspondent Act company’s Reserve to holding Federal a respect on consider ruling with to directed obligations are keeping regulators Bank record with compliance requires h S ARO c loicue rhbtoso orsodn consfrfrinselbnsand banks shell foreign for accounts correspondent on accounts. prohibitions or customers includes risk also high Act certain for PATRIOT review USA of The level heightened a Impose and transactions; suspicious for activity account • Monitoring • euain fteFdrlRsreBadpoieta akhligcmayms ev sasuc of source a as serve must company holding bank a that provide Board Reserve Federal the of Regulations Regulation. Federal Agreement”) (“Informal agreement informal an into enter to agreed Bank Investors 2016, 12, August On anti- and Act Secrecy Bank the of scrutiny regulatory the increased have agencies regulatory bank The akhligcmais nldn netr acr,Ic,aesbetto subject are Inc., Bancorp, Investors including companies, holding Bank 35

FORM 10-K 36 • making• or servicing loans; performing• certain data processing services; providing• discount brokerage services; or acting as leasing fiduciary,• personal investment or or real financial property; advisor; making• investments in corporations or projects designed acquiring primarily a to savings promoteA and community bank loan welfare; association. and holding company that elects to be a financial holding company may engage in• activities that are each• of its depository institution subsidiaries is each “well of capitalized”; its depository institution subsidiaries is “well managed”; In addition, a bank holding company that does not elect to be a financial holding company under federal In addition, Federal Reserve Board guidance sets forth the supervisory expectation that bank holding A bank holding company is required to provide the Federal Reserve Board prior written notice of any As a bank holding company, Investors Bancorp is required to obtain the prior approval of the Federal financial in nature or incidentbe to a activities financial which are holding financial company,to in become although nature. a it Investors financial may Bancorp, holding seek Inc. company to has if: not do elected so to in the future. A bank holding company may elect prohibit the bank holding companyother parent form of of capital the distribution undercapitalized without bank the from prior paying approval any of dividend the or Federal making Reserve Board. any companies will informexceeds and earnings consult for with thesignificantly quarter Federal reduce and Reserve dividends shoulddividends Board if inform previously staff paid the (i) during in Federalearnings that net Reserve advance period, retention income is Board of not is available and issuing sufficientprospective not should to to financial a eliminate, fully condition, consistent shareholders dividend fund defer or with theits for (iii) that or minimum dividends, the the the regulatory (ii) bank capital bank prospective past holding adequacy rate holding ratios. company four of will company’s quarters, not capital meet, net or needs is of and inpurchase danger overall of or current not meeting, and redemptionredemption, of when combined its withpreceding outstanding the 12 equity net months, consideration wouldReserve securities Board paid be may if for equal disapprove all to the suchan a such 10% unsafe gross purchase and purchases or or unsound consideration redemption or moreor practice, if redemptions of for any or it condition the during would determines the imposed violate that company’s the by,not the any purchase consolidated or required proposal law, written net for would or regulation, agreement a constitute worth. Federal with, bankReserve Reserve The the holding Board Federal Federal company Board, order Reserve that or Board. is thatmanagement, Such directive, as at notice “well its has and capitalized” most approval under recent receivedthe is applicable bank subject holding regulations of a company of any examination the unresolved composite by supervisory Federal the issues. “1” Federal Reserve or Board, and that “2” is not rating,Reserve Board as to wellFederal acquire Reserve all, as Board approval or a iscontrol substantially also of “satisfactory” all, any required voting for of rating securities Investorswould, the of Bancorp directly any for to assets bank or acquire or of indirectly, directholding bank any own or company. holding indirect or company bank if, ownership control or after or more giving bank than effect holding to 5% such company. of acquisition, any Prior it class of voting shares of such bank or bank regulations is generallyengaged prohibited in non-banking from activities. One engagingFederal of Reserve in, the Board principal to or be exceptionsactivities acquiring so to that closely this the direct related prohibition Federal to Reserve is or banking Board for or has indirect activities managing determined found control or by by controlling regulation the of banks. to be Some any closely of related the company to principal banking are:

FORM 10-K oprt oenne uiigadacutn,eeuiecmesto,adehne n ieydslsr of disclosure timely and enhanced and compensation, executive information. accounting, corporate and auditing governance, a registration, corporate in without sold market, public unless the or in sell period. registration information to three-month public any able without current in is shares specified resold Inc. of meets Bancorp, number be Inc. Investors limited Bancorp, not of Investors affiliate may If each restrictions. Inc. requirements, resale Bancorp, certain the with Investors accordance under of requirements stockholders) is other principal Inc. and Bancorp, restrictions Investors trading amended. insider as solicitation, 1934, 1934. of proxy of Act Act information, Exchange Securities Exchange the Securities to the subject under Commission Exchange Acquisition the on “Restrictions such See of Commissioner. approval Bank.” the obtaining Investors and and first Board Inc. without Reserve Bancorp, Bank Federal Investors Investors of the or by Inc. control Bancorp, of Investors to acquisition of control subject acquire is may and person Commissioner the with a and reports controlling “company” company certain terms holding file the bank must Each defines Commissioner. bank BHCA. Act the the savings Banking by under examination or Jersey defined bank New are The Jersey-chartered terms company. such New as holding investment company” bank holding a and nature, “bank as regulated in funds is financial banking. mutual bank to are related sponsoring closely be that to making; determined activities has market Reserve in Federal the engage and as that activities treated to dealing, other if be and permitted may laws underwriting, companies, banks generally banking well-managed securities federal are and under including well-capitalized which imposed of subsidiaries,” subsidiaries previously Certain companies “financial satisfied. financial are other criteria and certain companies, York insurance New Investors and firms, amendments, Jersey New these existing Under its state. to state addition the host in in such states in location other chartered that in banks offices state at if offices. branch branch state branch establish a host to in another establish permitted bank in is to a location Bank permits a permitted at generally be branch authority also novo branching interstate de would and nationwide a banking for establish interstate to framework this state a one amended, establishing As by branching. activities and banking banking interstate regulates to Act, Dodd-Frank applicable the be Investors potentially assistance to would addition any in law for institution This depository or a default. subsidiary institution, of separate danger a depository as in controlled acquired institution ever commonly Bank. it an if a such Inc. of to Bancorp, Investors FDIC default the the by with provided connection in FDIC ne eea a,dpstr ntttosaelal oteFI o osssfee ratcptdb the by anticipated or suffered losses for FDIC the to elects it liable that are stating institutions Board Reserve depository Federal law, the federal with Under certification a filed has company holding Act bank Reinvestment the Community “satisfactory” a least at has • subsidiaries institution depository its of each • abnsOlyAto 2002 of Act Sarbanes-Oxley and directors officers, (generally affiliates are who persons by held stock common Inc. Bancorp, Investors Laws. Securities Federal Inc. Bancorp, Investors of Acquisition Regulation. Jersey New securities banks, among affiliations to barriers the of most eliminated 1999 of Act Gramm-Leach-Bliley The of 613 Section by amended as 1994, of Act Efficiency Branching and Banking Interstate Riegle-Neal The obcm iaca odn company. holding financial a become to and examination; recent most its at rating ne h e esyBnigAt opn wigo otoln savings a controlling or owning company a Act, Banking Jersey New the Under netr acr,Ic’ omnsoki eitrdwt h euiisand Securities the with registered is stock common Inc.’s Bancorp, Investors . h abnsOlyAto 02wseatdt drs,aogohrissues, other among address, to enacted was 2002 of Act Sarbanes-Oxley The ne eea a n ne h e esyBnigAt no Act, Banking Jersey New the under and law federal Under 37

FORM 10-K 38 Taxation Prior to the 1996 Act, bad debt reserves created prior to January 1, The Internal Revenue Code imposes an alternative minimum tax (“AMT”) at a For federal income tax purposes, Investors Bancorp, Inc. currently reports its Historically, Investors Bank was subject to special provisions in the tax law regarding Investors Bancorp, Inc. and its subsidiaries are subject to federal income taxation in the same As directed by the Sarbanes-Oxley Act, our Chief Executive Officer and Chief Financial Officer are We have existing policies, procedures and systems designed to comply with these regulations. Taxable Distributions and Recapture. General. Method of Accounting. Bad Debt Reserves. Alternative Minimum Tax. required to certify thatThe our rules quarterly adopted and byofficers annual the certify reports SEC that: do under they the notof are Sarbanes-Oxley contain our responsible Act any internal for have untrue control establishing, severalcommittee statement maintaining over requirements, of of and financial including the regularly a reporting; having Board evaluating they material these information of the have fact. in effectiveness Directors made our about certain quarterly our disclosuresour internal to and internal control our annual control over auditors reports over financial andfinancial about financial reporting. the reporting; their reporting audit and evaluation or they and in have whether other included factors there that have could been materially changes affect in internal control over allowable bad debt taxSmall deductions Business and Protection related Actincome reserves. of method Tax 1996 for law (the tax changes “1996bad years Act”), were after debt which enacted 1995 reserves eliminated in and theCurrently, accumulated 1996 required Investors use pursuant recapture after Bank of to into 1987. uses the taxable the thepurposes. Investors percentage income specific of Bank over charge taxable a has off six-year method fully period to recaptured of account all for its bad post-1987 debt reserve deductions for balance. income tax Federal Taxation general manner assubsidiaries other file corporations, a with consolidatedcurrently some under federal exceptions audit. income discussed The tax Internalfederal below. Revenue return. tax Investors Service Investors returns completed Bancorp, Bancorp, its inpertinent Inc. examination Inc.’s 2016. of and federal federal The the its following Company’s tax income 2013Investors discussion returns Bancorp, and tax of are Inc. 2014 federal matters or not its taxation and subsidiaries. is is intended only not to a summarize comprehensive certain descriptionincome and of expenses the on thefederal tax and accrual state method rules income of tax applicable accounting returns. and to uses a tax year ending December 31 for filing its 1988 (pre-base yearcertain reserves) thrift were asset subject andare to definitional required recapture tests. to As into be a recapturedto taxable into result income recapture income of over if the if adividends Investors 1996 Investors six-year in Act, Bank period. Bank bad excess However, failed debt all of makesInvestors to reserves pre-base Bank’s tax certain meet total year accumulated earnings federal reserves after non-dividend pre-base and are 1987 year subject distributions, profits, reserve was or repurchases approximately ceases $45.2 any million. to of maintain its a bank stock, charter. pays At December 31, 2016, rate of 20%income” on or a “AMTI”). The base AMTAMT of is payable exceeds regular to the the taxable extentpayments regular income such of AMTI income plus AMT is tax. certain may inand excess be Net tax of its used operating an preferences as exemption subsidiaries losses (“alternative amount creditscarryover. and have can minimum against the regular offset taxable not tax no been liabilities more subject in than future to years. 90% the Investors of Bancorp, AMT AMTI. Inc. and Certain have no such amounts available as credits for

FORM 10-K ui ihrsett t e okSaecmie rnhs a eunfrtxyas21 n 2014. and under 2013 Commuter years currently tax is for Metropolitan Bank return Investors tax the income. franchise net combined tax, in State entire franchise York State apportioned New on York and its Transportation New allocated to recomputed carried on Metropolitan respect a rate with the of activities audit tax 28.0% to to 9% was expected subject a business 2016 be using are for can to calculated surcharge affiliates legislation MTA its new allocable The of the and District. rate under Surcharge Transportation Company a entire State at the York combined (“MTA”) taxed New addition, and the State to Authority In on York sourced based time. New are to is over that apportionable tax revenues fluctuate and now franchise of allocable will to corporate affiliates amount corporations relating its The The banking and rules 6.5%. that tax. Company rates, so franchise the tax tax of corporate corporation period income State’s banking to net future the the changes to of significant under changes elimination in taxed including the resulted be and banks, legislation income, for new of The taxes sourcing 2015. income the 1, calculating January of effect method into the went that system tax realized. corporate be state to the not the of than on portion likely Based more the years. not for is taxable established that 5 was contribution succeeding allowance the allowable the valuation to the to a remaining related over forward income, benefit the contribution carried tax taxable and excess be state Bank the may future Investors Inc., entity standalone by Bancorp, standalone entity’s made Investors the For was for Inc. limit which Bancorp, deduction of Investors million and by $10.0 million operations Foundation, $10.0 own Charitable Investors its the including to group, controlled consolidated or a Jersey file group New to the affiliated taxpayer Jersey, filing the the New tax require of of the discretion, State operations director’s the that in the entire income. evidence on at the convincing However, carried may, for and business Taxation ownership. its of return clear common on Division by is taxpayer the demonstrate there the of of cannot Director where earnings taxpayer group true the affiliated the if discloses the of legislation, member tax another under with a as basis taxed consolidated be to 31, be elects December to At therefore elect 3.6%. and to of rate requirements eligible a be eligibility at may the taxed Company. be it meets Investment to requirements, Jersey currently it certain New allow Inc. meets would Bancorp, which Inc. Investors Company, Bancorp, Investment 2016, Investors Jersey New If a rate. as 9% taxed a Jersey, at tax. New tax Jersey in New income to institutions subject savings is adjustments, of certain income to subject the income, Generally, taxable federal basis. on unconsolidated based calculated an is which on returns tax business stock its of Taxation corporation. 20% State recipient least the by at from owned having received stock dividends its corporation for of a available 20% is than from deduction less received dividends-received having 70% is corporation dividends- A a corporate dividend corporation. The recipient the subsidiary. the owned when by wholly owned 80% a as is Bank deduction Investors from received received claims dividends Company of back 100% the carry income 2016, 31, to acquisitions. prior December ability to of related the As million was group. $7.1 has of conversion consolidated step carryforwards step old loss second second the operating the to net the 2014, federal law from total 7, tax had May resulting federal On under group years. allowed taxable consolidated normally 20 new succeeding The the to completed. forward and years taxable e prtn osCarryovers. Loss Operating Net e okSaeTaxation. State York New made was contribution charitable million $20.0 a conversion, step second Company’s the with connection In or combined a on return tax a file to taxpayer a for allowed not has and not does law tax Jersey New state a to subject generally is and return tax income Jersey New a file to required is Inc. Bancorp, Investors Taxation. State Jersey New Deduction Dividends-Received Corporate n21,NwYr tt nce infcn n opeesv eom oits to reforms comprehensive and significant enacted State York New 2014, In netr acr,Ic n t usdaisfl eaaeNwJre corporate Jersey New separate file subsidiaries its and Inc. Bancorp, Investors oprto a ar akntoeaiglse otepeeigtwo preceding the to losses operating net back carry may corporation A netr acr,Ic a xld rmisfdrltaxable federal its from exclude may Inc. Bancorp, Investors . 39

FORM 10-K 40 As a Delaware holding company not earning income in Delaware, Investors In 2015, New York City enacted provisions to its tax law to conform its corporate RISK FACTORS The risks set forth below, in addition to the other risks described in this Annual Report on Form 10-K, may At December 31, 2016, our portfolio of multi-family, commercial real estate, C&I and construction loans In 2006, the FDIC, the Office of the Comptroller of the Currency and the Board of Governors of the Federal New York City Taxation. Delaware State Taxation. adversely affect our business,and financial the other condition risks and describedcurrently operating in known this results. annual to In report, us there additionbusiness, or may to financial that also the we be condition additional currently risks orindicator risks deem set operating and of to forth uncertainties results. future be that below As performance, immaterial areperiods. a and not that historical result, could Further, trends materially past to should and financialconstitutes adversely not the performance forward-looking affect be statements, may extent our used the not to risk thatimportant be factors anticipate factors any a set results that forth reliable or of below couldlooking trends also the statements cause in are made our future information cautionary by statements or actual contained on identifying results behalf in to of us. this differ materially Annual fromBecause Report we those intend on expressed to Form in continue to any 10-K increase forward- our commercial originations, our credittotaled risk will $13.50 increase. billion, orfamily, 71.8% of commercial our real totalresidential loans. mortgage estate We loans. intend and Sinceoperation to of C&I repayment continue the to of loans, borrower’s increase commercialconditions properties our which or loans in originations related the depends generally of businesses, real on multi- repaymentour have estate the of market, commercial such successful more local loans management borrowers economy can riskdevelopment and or be with may than affected respect the by to management have one- one adverse compared of loan to more the to or an business one adverse than four-family or credit developmentplan property. with relationship one to respect can In to expose loan addition, continue a usallowance one- to to outstanding to for significantly increase four-family loan with greater residential our risk losses mortgage us.such of originations because loan. increase loss of Because of to Consequently, we the our these allowance increased an for loans, risk loan adverse characteristics it losses associated would may adversely with be affect these our necessary typesIf earnings. the of to bank loans. increase regulators Any impose thecould limitations be on level adversely our of affected. commercial real our estate lending activities, our earnings Reserve System (collectively,Real the Estate “Agencies”) Lending, issued Sounddid Risk joint not Management establish guidance Practices” specific entitledreceive (the lending increased “Concentrations “CRE limits, supervisory Guidance”). in it Although scrutiny providesloans Commercial the where secured that CRE total by a apartment Guidance non-owner bank’s buildings,300% occupied commercial investor or commercial real commercial real more estate real estate lending estateestate of and loans, exposure loan an construction including may portfolio institution’s and land hasoccupied total commercial loans, increased risk-based real represent estate by capital equaled 50% 386% and of or the Bank more total outstanding risk-based during balance capital the at of December preceding 31, the 36 2016. commercial months. real Our level of non-owner and banking tax laws toare those subject of to New the York newState State, combined franchise retroactive corporate to tax, tax January for subjectentire 1, New net to 2015. York income The the City is Company calculated Newthe and derived on tax York its from a law affiliates City outside similar provisions of basis apportionmentto have as the our rules. increased the effective New the While New tax York income rate. York the City apportioned majority jurisdiction, to the of New new York the sourcing City Company’s and rules in enacted turn, by caused an increase Bancorp, Inc. is exemptedannual fees from and Delaware an annual corporate franchise income tax to tax the but State of is Delaware. requiredITEM 1A. to file annual returns and pay

FORM 10-K ado u iblte.Se“aaeetsDsuso n nlsso iaca odto n eut of Results and Condition Financial of interest the Analysis as rapidly a and as In Discussion increase time. not “Management’s may over assets Risk.” See change Market our rates of on liabilities. Operations-Management earned interest our income assets. market interest on our because the than paid rates, maturities volatility, interest contractual earnings shorter rising significant have of generally period create liabilities can Our time. interest-bearing imbalance of This our period contractual on our a pay for on fixed we earn we expense income interest interest the the and between securities; borrowings. difference and and the deposits is loans as such income as liabilities, interest such Net assets, rates. interest-earning interest profits. our in reduce changes will rates by interest in increases future and adversely assets our could than faster which reprice experience liabilities experience, Our may portfolio loans loan These historical future 2012. our the since assess than to performance. to environment levels which future difficult from our economic charge-off is affect history and the It or payment loans in limited unseasoned. delinquency multi-family relatively are especially higher their our loans collectability, of of C&I because future portion our loans 31, of large judge December originated at all recently a 2016 billion these nearly Consequently, 31, $1.28 of and 2012. December to performance loans increased 31, at has estate December billion portfolio real $4.45 at loan commercial to million C&I Our increased $169.3 2012. has from 31, portfolio 2016 December estate at billion real $1.97 commercial from Our 2012. 31, December unseasoned of performance future the judge to all difficult nearly is and It portfolio unseasoned. estate are loans. real portfolio commercial loan and C&I portfolio our loan of multi-family our our of on portions effect Significant adverse loan material for a allowance have our would in authorities operations. increase regulatory of material results these and A by condition required charge-offs. financial as loan charge-offs further would loan recognize or or allowance losses losses our loan for was to provision million our $228.4 additions differ of 2016 Material results date. 31, such allowance. at December actual loans at our non-performing If losses of inherent loan to 220.18% losses conditions. for and cover additions loans allowance to total economic Our in of sufficient income. 1.21% be evaluate net resulting not our we may the portfolio, decrease losses loans for materially and our loan loan collateral review for we experience, our as allowance losses, serving our loan in delinquency assets for assumptions, allowance other our and the from and of significantly loss amount estate the real determining our the In loans. of and our value of the many of and decrease. repayment borrowers could earnings our our of losses, loan creditworthiness actual cover to sufficient not is losses of loan level for the allowance of of our result amount If a affected. the as adversely ratios on be capital would restrictions higher earnings impose require our the or to hold, portfolio, we were that our loans concentrations regulator in indicate estate and hold federal real and activities can commercial primary we lending risks, Bank’s loans easing estate estate lending the real real about FDIC, monitor commercial commercial the to concerns and discipline If attention” measure express underwriting special forward. identify, pay Agencies going maintain “to to to the continue practices institutions will Statement, management Agencies financial 2015 risk direct the exercise standards, In and underwriting estate Statement”). real “2015 commercial (the lending estate nDcme 05 h gnisrlae e ttmn npuetrs aaeetfrcmeca real commercial for management risk prudent on statement new a released Agencies the 2015, December In h neeticm eer norast n h neetepnew a norlaiiisaegenerally are liabilities our on pay we expense interest the and assets our on earn we income interest The affected negatively be could which income, interest net our on depends largely profit a make to ability Our at billion $3.0 from 2016 31, December at billion $7.46 to increased has portfolio loan multi-family Our increase to us require may and losses loan for allowance our review periodically regulators bank addition, In the including portfolio, loan our of collectability the about judgments and assumptions various make We 41

FORM 10-K 42 In addition, changes in interest rates can affect the average life of loans and mortgage-backed and related Changes in interest rates also affect the current market value of our interest-earning securities portfolio. We evaluate interest rate sensitivity using models that estimate the change in our net portfolio value over a During the past several years it has been the policy of the Federal Reserve Board to maintain interest rates at Our total assets have grown from approximately $12.72 billion at December 31, 2012 to $23.17 billion at Our ability to grow successfully will depend on whether we can continue to fund this growth while Public funds deposits are a significant source of funds for our lending and investment activities. At securities. A reduction insecurities interest as rates borrowers causes refinance increased theiris debt prepayments the to of risk reduce loans that their andthe we borrowing mortgage-backed rates costs. may and This we not creates related earned be reinvestment onprepayments. able risk, Additionally, the to which increases prepaid reinvest in loans the interest orborrowers funds rates to securities. may from repay Conversely, decrease faster adjustable-rate an loan loans. prepayments demand increase at and/or in rates make interest it that rates more are generally difficult comparable reduces for to Generally, the value of securitiesvalue of moves inversely our with totalreported changes securities in portfolio as interest was rates. $3.44 a Atavailable-for-sale billion. portfolio December Unrealized decreases, separate 31, net our 2016, losses stockholders’ component the on equity fair securities will of be available-for-sale adversely are equity. affected. To therange extent of interest interestexpected rate cash rates flows scenarios. increase fromof The assets, and a liabilities economic and 200 the off-balance value basisassuming sheet value point of management contracts. increase took At equity of in no Decemberexperience analysis our interest 31, action a 2016, rates, is to 6.2% in whereby mitigate the or theeconomic rates the value event $40.9 discounted effect increase of equity. million of present evenly decrease such over value in change, a of the net twelve-month model interest period, projects and incomeHistorically that and low we interest 11.5% would rates or may adversely $550.7 affect million our net decrease interest in income andhistorically profitability. low levels. Ashave a purchased result, have market been ratesliabilities at on lower the reprice levels loans or than weinterest mature available have expense originated prior more will and to be quickly the 2008. limitedmay than yields As at continue on a our these to securities general interest interest-earning we matter, decrease. ratewhich our assets. may levels Accordingly, have interest-bearing while However, our an the adverse our net average effect interest yield ability on on our income to future our may profitability. lower interest-earning be assets our adverselyWe may affected not and be able mayoperations. to decrease, continue to grow our business, which may adversely impact our resultsDecember of 31, 2016. Our businesspart, strategy calls upon for our continued growth. abilityinvestment Our opportunities, to ability and to open acquire continue newgrow, to other our grow banks branch results depends, and of locations, in non-bank operations successfully entities. could be In attract adversely the deposits, impacted. event identify that we favorable do loan not and maintaining continue to cost controls andbeyond asset our control, quality, such remain asto in national control and good regional standing costs economiccondition. with conditions and and our maintain interest regulators, rate as asset trends. well If quality, we as are such on not growth factors able couldPublic funds adversely deposits are impact anhurt important our our source profits. of earnings funds for and us financial and a reduced level of thoseDecember deposits 31, may 2016, $3.36 billion, or 22.0% of our total deposits, consisted of public funds deposits from local

FORM 10-K or.Sc euainadspriingvr h ciiisi hc akadishligcmaymay company holding its and Reserve bank Federal a the which by laws. oversight in protection and activities consumer regulation the to to respect govern subject with supervision CFPB, is and the Bancorp by regulation Investors and Such company, deposits, Board. holding our of bank insurer a as As FDIC, the by authority, and laws in changes by affected adversely be be may and would environment operations. regulated regulations. we such of highly results which a goodwill, our in in on operate to period effect We the adverse impairment operating an during in have statements future could financial results change of our such analysis Any in projections exist. earnings our to to on determined flows If charge is cash impairment rely impairment results. and an results actual to record operating to future from and required of make significantly projections experience to and vary in management historical environments result may competitive requires could on in business, impairment operate our based assessing We to performance. for disruptions assumptions or methodology market and flows valuation the cash judgments in Our future declines of goodwill. including estimates to trends, reduced economic impairments stock, or common industry our negative of Significant price annually. least at impairment, goodwill. to impairments incur may We negatively be need would or liquidity available funding and not alternative profitability is secure margins, to financing operating unable adequate our are if sources, we or funding impacted. If expensive funding rates. more to interest on access rely acceptable our to at maintain growth to future unable accommodate are to we if constrained an severely have may condition. level financial reduced and a operations and of Company results the liquidity, our for our funding on to of impact source related adverse important obligations an are indemnification funds earnings. FHLB and our our repurchase on incorrect, effect from adverse are an losses assumptions have of cover our would event result If to Such reserve. sell. sold. a sufficient established this we loans have be as residential that determining We loans not in loans loan. mortgage judgments mortgage may residential mortgage a and the reserve on of repurchase on assumptions borrower any obligations various to the of indemnification make of breach and required default We a repurchase payment is be estimated early connection there for of may event in reserve event the a we into the in in enter loans addition, or mortgage we fraud In substitute borrower agreements or warranties. repurchase sale to or loan us representations whole require sales The loan Mortgage. such with Home Investors subsidiary, condition. mortgage financial and operations of could results which liquidity, defaults, our to borrower on due certain impact purchasers or adverse loan fraud, an mortgage borrower have indemnify warranties, or and as loans representations mortgage of such income. repurchase breaches net activities, to our required investment affect be than adversely and could higher would We lending be which may deposits, our funds sources for public funding such our funds retain other on to these of paying unable with currently sources are associated are we other expense we if rates to interest or we the funds, the If resort those FHLB, risks. to retain the rate to forced from interest accounts borrowings are to funds public sensitive primarily we our more are and on therefore deposits rates funds funds are and higher public and our pay FHLB our deposits funds, to Further, the of time forced liquidity. source are short-term from our a or credit affect as accounts districts, deposits adversely of deposit hospital funds could demand letters public funds districts, balance such by school high-average retain collateralized these as to of inability such are use Jersey, which our Given New municipalities, securities. of investment other state and the departments in sheriff domiciled primarily entities, government netr aki ujc oetnierglto,spriinadeaiainb h JB,orchartering our NJDBI, the by examination and supervision regulation, extensive to subject is Bank Investors for goodwill evaluate We goodwill. as recorded million $77.6 approximately had we 2016, 31, December At be will flexibility financial Our institutions. financial various and FHLB the from directly borrow We our through originate we that loans mortgage residential the of portion a market secondary the into sell We 43

FORM 10-K 44 The potential exists for additional Federal or state laws and regulations regarding capital requirements, On August 12, 2016, Investors Bank agreed to enter into an informal agreement (“Informal Agreement”) Although the U.S. economy has emerged from the severe recession that occurred in 2008 and 2009, We have expanded our presence throughout our market area and we intend to pursue further expansion engage and areauthorities intended have primarily extensive for discretionthe the in requirement connection for protection additional with ofto capital, their the the pay supervisory imposition insurance and dividends of enforcement fund andadequacy restrictions activities, of on and make our including our other depositors. allowance operations, capitalBank for These restrictions loan distributions on regulatory Secrecy losses, our to compliance ability Act shareholders,oversight, and whether privacy Compliance) the issues in classification and (including theInvestors of anti-money form approval Bank, laundering our of Investors and Bancorp regulatory of assets and policy, and our merger regulations, operations. the or transactions. legislation, Any could have change a material inlending impact and such on funding practices regulation andin liquidity and standards, responding and bank to regulatoryenforcement concerns agencies orders. are New and expected laws, to trendscompliance remain regulations, active identified and and other in of regulatoryregulatory examinations, changes doing could including changes, business, increase theinternational our along and costs credit potential of markets, otherwise with issuance regulatory mayvalue affect of significantly negative of our affect our formal loans the developments and operations. markets investments, and in in New our which on-going laws, the we operations, costs do regulations, and financial business,Investors profitability. and the Bank Entered industry markets other Into for anthe and and Informal New Agreement Jersey with the Department the of Federal Banking domestic Deposit and Insurance Insurance. Corporation and and with the FDICSecrecy and Act the New (“BSA”)1) Jersey and develop, Department Anti-Money adopt of Laundering and2) Banking (“AML”) implement conduct and a compliance Insurance a system3) matters. (“NJDOBI”) of comprehensive develop, Investors with internal validation adopt Bank regard controlsreview and of agreed designed to implement certain to; Investors to Bank effective ensure Bank’s transactionsCommittee training full of BSA/AML programs and compliance the relating automated with Board. accountsBSA Numerous to BSA; compliance and actions for BSA. have system; AML Investors been BSA compliancemanagement and Bank taken and practices, and or also compliance policies, commenced agreed programs AML by proceduresstaff, through to Investors including compliance restructured and Bank hiring reporting controls. to senior and lines, personnel. InvestorsAgreement strengthen improved The could to its Bank technology failure lead and has to establish to increased achieve enhanced furtherThe compliance a action costs its with by to risk Compliance the the remediate requirements FDICresults of of and are operations. the NJDOBI, unknown Informal which and could could adversely affect adversely Investors affect Bank. our growthA worsening prospects, of financial economic conditions conditionoperations. could and adversely affect our financial condition and results of economic growth hasunprecedented been slow efforts relative toprolonged to deteriorating maintain prior economic low conditions post-recessionvalue could periods market of significantly despite affect our interest the loans thevalues markets rates and Federal in and investments, and which Reserve sales and we our encourage Board’s volumesnonperforming, do on-going and business, criticized economic operations, the unemployment and costs growth. levelsevents classified and may may A profitability. assets cause result Declines us return and to in in incur a to real greater losses decline estate and loan may in delinquencies, adversely demand affect increases our for inOur financial inability our condition our to and products achieve results profitability of and on operations. services. new branches These may negatively affect ourthrough earnings. de novo branching or the purchase of branches from other financial institutions. The profitability of our

FORM 10-K aig ntttosadcei nost 2000prdpstr eratv oJnay1 09 h legislation The 2009. 1, January to than retroactive rather banks, for depositor, institution, insurance per financial deposit $250,000 a of to of amount unions capital maximum credit the equity and increased tangible institutions permanently less also savings assets Act total Dodd-Frank The consolidated deposits. average the on an based in result could which accounts, checking bearing interest expense. have interest our to in businesses increase allowing thus deposits, demand were requirement this implementing Regulations to securities. (subject holding preferred excludes bank trust which by as 2015. inclusion banks, 1, for such to January eligible capital, applicable effective been 1 those have Tier than previously as less that companies instruments no certain are rules) that for grandfathering companies certain examined holding loan be and to savings the continue gives weakens and also will associations, laws. Act protection savings assets consumer federal Dodd-Frank federal in and The enforce banks and to less regulators. national in ability for acts the bank or billion applicable general $10 primary abusive” billion been attorneys than state have their $10 or that more by rules with with deceptive laws preemption banks Banks federal consumer “unfair, all the Bank. all prohibit over to with Investors authority apply to compliance enforcement that as authority laws and such protection examination the consumer assets, has of including CFPB range The wide institutions, a practices. savings for authority and rule-making broad banks has CFPB legislation The the laws. that expected is it costs. However, compliance and years. of and many much operating holding rules for our and new known increase details their materially be the of will not of significant regulations and may range many given implementing Act consequently, broad are and Dodd-Frank and institutions agencies the a regulations, federal of and financial The adopt impact rules Congress. the implementing to for of the reports agencies drafting and activities in federal studies discretion numerous various operating prepare to requires and and Act regulations, Dodd-Frank trading The investment, companies. operations. of deposit, costs our increase lending, to expected are will that and regulations standards and capital laws tightened new share. CFPB, in per the result value created to book things, continue our other of among dilution Act, the Dodd-Frank in The result payment may the and/ therefore, involve institutions and typically acquire values, Acquisitions trading to negotiations. and opportunities and book with discussions over in presented premium engage be a may may of we we and time branches to bank time or From acquisitions. and mergers the value. book on dilute impact could activity material acquisition a Future have could acquisitions future any of Bank. completion Investors of the operations to subsequent systems integrate presence. established risks. other an certain have and integration not entails income. do acquisition net by before we our Growing affect time which negatively of the may in period offset branches a areas these will operating take in branches of may new expense especially it the the that profitable, period, from this expect become During generate We can we branches. that these branches operating income these from the resulting whether expenses on increased depend will strategy expansion h odFakAtas raee h aefrFI eoi nuac seset.Assmnsaenow are Assessments assessments. insurance deposit FDIC for on base the interest broadened also paying Act on Dodd-Frank The prohibitions federal the eliminated Act Dodd-Frank the 2011, 21, July Effective and bank for requirements capital risk-based and 1) (Tier leverage minimum required Act Dodd-Frank The protection consumer enforce and supervise to powers broad with CFPB the created Act Dodd-Frank The the affecting and structure regulatory bank current the changed significantly has Act Dodd-Frank The numerous by marked consolidation undergoing is industry banking the region, our in and nationally Both successfully to failure years, recent in acquisitions business integrated successfully have we Although 45

FORM 10-K 46 The Dodd-Frank Act required publicly traded companies to give stockholders a non-binding vote on Effective December 10, 2013, pursuant to the Dodd-Frank Act, federal banking and securities regulators In July 2013, the FDIC and the Federal Reserve Board approved a new rule, effective January 1, 2015, that The final rule includes new minimum risk-based capital and leverage ratios, which became effective for The application of more stringent capital requirements for Investors Bank and Investors Bancorp could, The CFPB has issued a final rule which implements certain provisions of the Dodd-Frank Act, which also increased theinsured required deposits, minimum and reserve directedwith the ratio less FDIC than for $10 to billion the offset in the Deposit assets. effects Insurance of Fund increased assessments from on 1.15% depositoryexecutive to institutions compensation 1.35% and so-called of “goldenthe parachute” national payments. securities It exchanges alsomandating provided shall that the require the recovery listed listingrestatements. companies standards of The of to incentive legislation implement also compensation andcompensation directed disclose paid paid the to “clawback” bank to Federal policies holding Reserve executive company Board executives. officers to in promulgate rules connection prohibiting with excessive accounting issued final rules to implementthe the Volcker Volcker Rule Rule. restricts Generally,term subject insured to proprietary depository a institutions trading transition and periodloans of their and certain that certain affiliated exceptions, securities, companies arehedging from investing not engaging activities in registered in funds that short- withprohibitions with do the and collateral not Securities restrictions comprised hedgeapplies. will and of a apply less Exchange specific to than Commission identified banking 100% (“SEC”) risk. entities, and After including from the Investors engagingWe transition Bancorp, have in period, unless become subject the an toon more exception Volcker equity, stringent or capital Rule constrain requirements, us which from may paying adversely dividends impact or our repurchasing return shares. substantially amended the regulatory risk-basedThe capital final rules applicable rule to implementsAct. Investors Bank the and “Basel Investors Bancorp. III” regulatory capital reforms and changes requiredInvestors by Bank the and Investors Dodd-Frank Bancorpfor on purposes January 1, of 2015, calculatingTier and these 1 refines to ratios. the risk-based definition The capital ofunder new ratio what prior minimum constitutes of rules); “capital” 4.5%; capital (iii) (ii) requirements afinal a total are: rule Tier capital also (i) 1 establishes to to a a risk-based risk-basedin new “capital assets assets the conservation common ratio capital buffer” following of equity ratio of 8%; of minimum 2.5%assets and 6% of ratios: capital (iv) (increased common (i) from a ratio equity 4% Tier Tier a ofcapital 1 1 common 8.5%; conservation capital, leverage and and buffer equity ratio will will (iii) of Tier result be 4%.to a 1 phased The 1.25% total in capital on incrementally, capital ratio starting January tosubject of at 1, risk-based to 0.625% 7.0%; 2017, limitations assets on (ii) 1.875% on January ratio a paying 1, oncapital of dividends, 2016 Tier January level 10.5%. engaging and 1 1, falls The increasing in to 2018 share required belowretained repurchases, and risk-based minimum income the and 2.5% that buffer paying can on discretionary amount. be January bonuses utilized These 1, if for limitations its such 2019. actions. will An establish institution will a be maximum percentageamong of other eligible things,regulatory result actions in constraining lowercomply us returns with such from on requirements. paying equity, dividends require or the repurchasing raising shares ofNew if additional regulations could we capital, restrict were our and ability to result to originate be in and unable sell mortgage to loans. requires lenders to make aLoans reasonable, good that faith determination meet of a this borrower’s ability “qualified to repay mortgage” a mortgage definition loan. will be presumed to have complied with the new

FORM 10-K aktae.Tegetrrsucsaddpstadla rdcsofrdb oeo u opttr a limit may competitors Business.” our 1. our of more “Item in some see deposits compete information by and additional successfully offered loans For products to assets. price loan interest-earning ability to our and continued able increase deposit our to be and ability and upon may resources our depends competitors services greater locally certain larger The profitability offer area. addition, Our have operating and market In have, can. business, provide. we firms we attracting cannot than than in banking or limits them aggressively not lending benefit investment do and that we presence resources and market that greater and substantially brokerage recognition have name companies, competitors and greater finance our unions, of companies, credit Some firms, insurance elsewhere. brokerage funds, mortgage institutions, mutual savings banks, commercial numerous profitability. and growth our limit may area market our within competition Strong continue to the likely are of and content develop and to continuing scope are future. The compensation the taking. in incentive evolving on risk policies inappropriate regulators’ encourage banking U.S. that arrangements payment incentive-based and practices current our on impact an operations. have of could results practice our compensation this impact as to employees changes our regulatory with Potential arrangements practices. payment the incentive-based quantify utilize reform. to currently tax possible We corporate not from number is result the could it Given that take, levels. capital may capital certain regulatory reform or exceeds Regulatory tax also income assets enacted. corporate our would tax being is any to deferred which change form impact proposals of asset, the negative ultimate value rates, which potential tax the the in tax to deferred in period relating our corporate decrease the uncertainties the of in during of if value income decrease reduced the net be any While in to also from reduction decrease preferences. could earned material tax basis material income a other a income in of and/or in net result taxation credits result prospective tax U.S. could a deductions, currently the on various discussed modifying eliminating benefit rate, or may tax limiting we corporate and percent U.S. 35 the outside the lowering include approaches regulations. and certain laws tax to U.S. in loans changes or by affected our loans adversely limit be of could may We which types loans, certain these make make to to consuming rule time desire rate CFPB’s and/or or The interest expensive profitability. assessments. ability maximum more or and it and growth our insurance make schedule taxes, limit could payment borrower applicable or the amortizing could all borrowers, qualify fully account mortgages to a into qualified upon on taking relied years, based on resources five loan financial first the the and underwrite during income and the loan document the and for verify also must Lenders specified certain contain not must loan mortgage” “qualified a rule, including: CFPB’s features, the Under standard. ability-to-repay optto ntebnigadfnnilsrie nutyi nes.I u aktae,w opt with compete we area, market our In intense. is industry services financial and banking the in Competition prohibit which Act Dodd-Frank the of provisions compensation-related the to subject is Bank Investors Possible 2017. in code tax income corporate U.S. the reforming in interest an indicated have makers Policy 43%. exceed not may ratio debt-to-income total borrower’s a mortgage,” “qualified a as qualify to years. Also, 30 than longer fide terms “bona less amount, • and loan negative-amortization; total the of • 3% payments; interest-only exceeding (those fees • and points upfront excessive • icutpit”frpieloans); prime for points” discount 47

FORM 10-K 48 As a “large institution” within the meaning of FDIC regulations (i.e., greater than $10 billion in assets), Although we pay quarterly cash dividends to our stockholders, stockholders are not entitled to receive We continue to devote a significant amount of effort, time and resources to continually strengthen our Information technology systems are critical to our business. We use various technology systems to manage In addition, we outsource a majority of our data processing to certain third-party providers. If these third- There have been increasing efforts on the part of third parties, including through cyber attacks, to breach Any future increase in FDIC insurance premiums will adversely impact our earnings. Investors Bank’s depositassessed insurance based on premium aadjustments. is risk However, determined classification beginning determined differently indetailed by than 2011, scorecard examination approach ratings, large smaller involving financial institutionsincluding banks. (i) ratios became certain a Small and subject stress performance certain testing, banks to score specified potential and determined assessment are loss (ii) using based to a forward-looking upon the loss riskrate, a FDIC severity measures, subject insurance score, more to fund which certain adjustments, is ifthe with designed the FDIC institutions to institution deemed issued measure, failed. riskierformula. based The a paying Since on total higher final the modeling, assessments. score large rule, In is institutionBank’s October effective converted deposit assessment 2012, to insurance procedure March assessment an is 1, is still assessment uncertain. relatively 2013, new, which the long clarifies term and effectWe on refines may Investors its eliminate dividends large on our bank common assessment stock. dividends. Downturns in domesticconsider, and among global other economies things, andpaid other the on factors elimination our could common of stock. cause or our reduction board in of the directors amount to and/or frequencyWe could of be cash adversely dividends affected by failure in our internal controls. controls and ensure complianceinternal controls with could complex have accountingthat a customers, standards regulators significant and and negative investors banking may impact have regulations. not of A us. only failure on in our earnings,Risks our associated but with also system failures, onearnings. interruptions, the or perception breaches of security could negatively affect our our customer relationships,policies general and ledger, procedures securities to(including prevent investments, privacy or deposits, breaches limitaddressed and and the if loans. they impact cyber-attacks), do of Weproducts but occur. system and have such In failures, services. established addition, events interruptions, Althoughand any we and networks may compromise may take security of still be protective breaches ourcode vulnerable occur measures, and systems to cyber the or could breaches, attacks security unauthorized that deter may could access, of customers have misuse, not our from an computer impact computer using be viruses, on systems, our information or adequately security. software, other malicious party providers encounteradequately difficulties, process and oradversely affected. account if Threats to for wevarious information other transactions security have vendors also and could their difficulty exist personnel. in be communicating the affected, processing with of and customer them, information our through our businessdata ability security operations at to couldinstances financial be involving institutions financial or servicesclient with and or respect customer consumer-based to information companies financialused or reporting to transactions. the the cause There destruction such unauthorized have orand security disclosure theft been breaches may of of change several originate corporate frequently, recent from data. often less In are not addition, regulated recognized because and until the remote launched techniques against areas a around target the world, we may be unable to proactively

FORM 10-K n uheetcudhv aeilavreefc norbsns,oeain n iaca condition. financial of and occurrence operations the business, in our procedures, result on recovery and effect disaster loans, adverse test our material regularly of a and repayment have established securing could ability event collateral have the such of we impair any value While expenses, could the additional revenue. events reduce in of Such loans, result loss terrorism. their and the of repay facilities acts to our storm- potential borrowers of for our other stability metropolitan targets of the the and central impact and to remain flooding damage, systems continue Jersey significant communication and significant New and cause been, Northern cause operating have and compromising institutions may area at Financial York aimed that future. New threats the events terrorist in of Such events targets common areas. be, more prone become may flood damage and related waters business. conduct coastal to near ability our impact could events external other and terrorism of acts or weather, effectively Severe loan products new such these managing with profit. and a experienced offering at as products for not a such resources are have offering and in we could unsuccessful time which because be loans, additional addition, of may multi-family In risk require and higher operations. may loans a of we have estate results products, generally real our loans residential of on four-family types effect to These negative one- team. our lending healthcare to a compared as loss well as teams lending leveraged effect negative a have may and the risks into lending lending increased to operations. business to of our us results continue expanded expose our and may on to team which lending of able leveraged both and market, be based healthcare asset not an hired have may We we personnel, qualified or strategy. experienced business our integrating implement successfully and hiring, attracting, successful execute and strategy business our implement to sufficient be operations. not may efforts recruitment Our affect short-term adversely may off and profitability our pay our for of reduce proceeds to stock. shares may net common repurchasing effectively used our the capital and of of were the dividends value remainder deploy cash the proceeds the to paying utilize failure net items, Our to other stock. continue the among common We a in including, of securities. and purposes, sold in portion shares corporate stock invest 1,000,000 general and substantial common issuing matured of A by they shares foundation as contribution. 6,617,421 Charitable borrowings of cash Investors purchase to million million the $20.0 $10.0 for contributed Plan and Ownership offering; Stock the Employee our to funding an have may offering conversion step second performance. our financial in our raised on capital our effect the adverse on deploy effect effectively to adverse failure material Our a have could expose events could these or of scrutiny, operations. Any regulatory of additional liability. results to and financial us condition possible subjecting financial and thereby business litigation and to customers us of loss a in result information bank confidential to of customers breaches. transmission security our secure data of of requires ability risk devices, The the mobile increases measures. through and preventative and adequate online implement including to remotely, or techniques these address ete-eae vnshv desl matdormre rai eetyas seilyaeslocated areas especially years, recent in area market our impacted adversely have events Weather-related and based asset include to team lending our expanded have we portfolio, loan our diversify to effort an In in succeed not do we If challenging. more efforts recruitment our find may we grow, to continue we As provided Bank; Investors in offering conversion step second our from proceeds net the of 50% invested We and reputation our damage could security of breach or interruption, failures, system any of occurrence The 49

FORM 10-K 50 UNRESOLVED STAFF COMMENTS MINE SAFETY DISCLOSURES LEGAL PROCEEDINGS PROPERTIES Not applicable. We and our subsidiaries are subject to various legal actions arising in the normal course of business. In the At December 31, 2016, the Company and the Bank conducted business from their corporate headquarters in None. opinion of management, the resolutionour financial of condition these or legal results actions of is operations. not expected to have aITEM material 4. adverse effect on Short Hills, New Jersey, withoffices operation centers in located Short inMelville, Iselin as Hills, well and as Robbinsville a Robbinsville, New full-service Jersey branch Mount as network well of Laurel, 151 as offices. lending SpringITEM 3. Lake, Newark, Manhattan, Queens, Brooklyn, ITEM 1B. ITEM 2.

FORM 10-K TM5. ITEM n hit vrsc eid uuaiertr sue h eneteto iied,adi xrse in expressed is and dividends, of reinvestment banks traded the publicly assumes all $100. of of return return investment total Cumulative assumed cumulative an total period. on the cumulative based (c) the such dollars (b) and, over 2016, period, 31, such thrifts December over through and thrifts 2011 traded 31, publicly December of beginning return period the for stock common reduce not will Graph dividend Performance such Stock will of it payment either the and or a impaired stock, pay be capital not not its may of will Bank 50% stock interest Investors than capital the surplus. and less law, its statutory not from income, Jersey dividend, its of New investment earnings such surplus Under stock, of than statutory plan. payment common a other ownership the have of stock income after shares employee unless, of of the dividend source sale to cash loan the no its from has on retained Inc. earned proceeds Bancorp, net in Investors of is because investment or Bank, meet, Investors dividends, not from will the and company fund needs holding fully capital bank ratios. company’s to the adequacy should holding capital sufficient (iii) bank four regulatory and minimum not or the past its Board with condition, the is meeting, not consistent financial Reserve for period, of not prospective danger shareholders Federal that is and to retention the during current available earnings paid inform overall income of a net previously rate issuing should (i) prospective of dividends and advance if (ii) of in quarter dividends relevant staff net reduce expectation the Board significantly quarters, supervisory Reserve other for the or Federal forth dividends defer earnings with and to sets cash consult eliminate, exceeds directors guidance of and condition of Board frequency that inform board Reserve and/or will our financial dividend amount Federal companies cause the addition, holding in could In requirements, bank reduction factors stock. that or cash other common capital of of and our elimination amount on economies earnings, the paid global and things, and timing other our domestic The among in quarterly. consider, on Downturns stockholders to depend dividends factors. pay paid We dividends. dividends receive share. to per entitled $0.05 of not dividend cash special a is 2015 of quarter first the in Included (1) foregoing the in included Market. Select or Global stock NASDAQ known common the Inc.’s not by provided Bancorp, is was Investors information 23, shares for following February information such The name indicated. market of “street” of periods quarterly or as the owners “nominee” presents for stock in table beneficial common held following of are Inc.’s The Inc. number number. Bancorp, Bancorp, the Investors Investors of accordingly, of shares and record Certain 8,600. of approximately holders was 2017 of number approximate The u hrso omnsokaetae nteNSA lblSlc aktudrtesmo “ISBC”. symbol the under Market Select Global NASDAQ the on traded are stock common of shares Our e ot eo sasokpromnegahcmaig()tecmltv oa euno h Company’s the on return total cumulative the (a) comparing graph performance stock a is below forth Set dividends of receipt the upon part, in depend, may Inc. Bancorp, Investors from dividends 0.05 future, the 0.05 In 11.99 0.05 11.27 13.13 11.55 12.59 $0.10 0.08 12.72 $10.70 0.06 $11.98 11.58 0.06 10.71 $0.06 14.39 10.67 12.30 are stockholders $10.77 however stockholders, 12.05 our to $12.37 dividends cash quarterly paying been have we 2012, Since Quarter Fourth Quarter Third Quarter Second Quarter First ATR N SURPRHSSO QIYSECURITIES EQUITY OF PURCHASES ISSUER STOCKHOLDER AND RELATED MATTERS EQUITY, COMMON REGISTRANT’S FOR MARKET High eebr3,2016 31, December atII Part erEnded Year 51 Low Dividends Declared High eebr3,2015 31, December erEnded Year Low Dividends Declared (1)

FORM 10-K Programs Under the Plans or Yet to be Purchased SNL U.S. Thrift or Programs Announced Plans As part of Publicly Average Per Share Price paid 52 SNL U.S. Bank and Thrift 100.00100.00 132.26100.00 134.28 192.11 121.63 183.86 217.44 156.09 205.25 246.04 167.88 209.39 282.11 188.78 264.35 231.33 Shares Investors Bancorp, Inc. Investors Purchased(1) Total Return Performance Total Return Total Number of Investors Bancorp, Inc. October 31, 2016November 30, 2016December 31, 2016 1,750,000 401,472 $11.96 $12.45 $20,926,090 — $ 4,996,671 21,660,643 $ — 21,259,171 $ — 21,259,171 50 12/31/11 12/31/12 12/31/13 12/31/14 12/31/15 12/31/16 250 200 150 100 350 300

Totalpurchase of an additional31,481,189 10% million of shares. itsJune publicly-held The 17, outstanding plan 2016. shares commenced This ofDecember upon program common 31, has the 2016. stock, no completion or expiration approximately of date the and has second 21,259,171 repurchase shares plan yet to on be repurchased as of 2,151,472 $25,922,761 Period October 1, 2016 through November 1, 2016 through December 1, 2016 through Source: SNL Financial LC, Charlottesville, VA The following table reports information regarding repurchases of our common stock during the quarter Index Value Index (1) On April 28, 2016, the Company announced its third share repurchase program, which authorized the Investors Bancorp, Inc. IndexSNL U.S. Bank and Thrift SNL U.S. Thrift Stock Repurchases ended December 31, 2016 and the stock repurchase plans approved by our 12/31/2011 Board of Directors. 12/31/2012 12/31/2013 12/31/2014 12/31/2015 12/31/2016

FORM 10-K annsprsae—dltd$06 .5$03 .0$0.32 0.32 $ $ 0.40 0.40 56,083 $ $ 0.38 63,755 0.38 44,112 $ 207,007 $ 74,751 0.55 36,571 0.55 144,850 245,711 65,000 $ 99,372 $ 41,861 0.64 0.65 175,786 339,860 123,444 50,500 106,947 $ 40,125 $ 206,472 328,332 109,642 37,500 77,063 280,877 358,564 37,201 118,891 diluted — share 26,000 per 77,571 Earnings basic 299,072 — 136,639 496,189 share per Earnings $ 19,750 545,068 77,571 153,336 expense $ tax Income expense tax 660,862 income before Income 1,066,817 77,571 $ 2,705,652 8,768,857 expenses 28,233 731,723 Non-interest 1,334,327 income 3,367,274 Non-interest $ 113,941 10,718,811 77,571 793,521 3,577,855 12,172,326 2,766,104 8,273 $ 152,788 losses 3,311,647 14,063,656 loan for 3,263,090 Provision 15,280,833 3,123,245 6,868 161,609 4,546,251 179,922 expense Interest income dividend and Interest 159,152 831,819 Data: Operating Selected 7,431 10,306,786 $12,722,574 161,940 1,564,479 $15,623,070 12,882,544 $18,773,639 38,298 1,844,223 14,887,570 $20,888,684 equity $23,174,675 Stockholders’ 16,661,133 1,755,556 Goodwill 18,569,855 funds Borrowed Deposits insurance life owned Bank at sale, for available Securities maturity to held Securities held-for-sale Loans net receivable, Loans assets Total Data: Condition Financial Selected this Operations” in of elsewhere Results included notes and reference related Condition information, and Financial additional Inc. information For Bancorp, of share Investors ratio. Analysis Report. all of exchange Annual and 2014, Statements one Discussion 7, Financial to May Consolidated Management’s 2.55 the on the 7. and conversion reflect “Item step to to second revised made the been is of has completion date the that to of prior result a As Inc. Bancorp, 6. ITEM herein. reference by incorporated is Information” Plan Compensation Information Plan Compensation Equity siae arvle16043134671179475021,385,328 785,032 1,197,924 1,304,697 1,660,433 value fair estimated h olwn nomto sdrvdi atfo h osldtdfnnilsaeet fInvestors of statements financial consolidated the from part in derived is information following The e noe$1215$1155$1171$1201$88,767 $ 112,031 $ 131,721 $ 181,505 $ 192,125 $ 372,745 435,426 541,971 595,084 income Net 640,185 after income interest Net income interest Net “Equity heading the under Report Annual this of III Part of 12 Item in forth set information The rvso o onlse 2,3 6,8 0,7 8,2 307,745 384,926 504,471 569,084 620,435 losses loan for provision EETDFNNILDATA FINANCIAL SELECTED 2016 2016 53 2015 2015 erEddDcme 31, December Ended Year tDcme 31, December At I thousands) (In I thousands) (In 2014 2014 2013 2013 2012 2012

FORM 10-K 2012 2013 2014 2015 At or for the Year Ended December 31, 2016 54 assets and the weighted- average cost of interest-bearing liabilities forperiod. the period. non-interest income. non-interest income adjusted.accelerated For vesting the of yearassociated equity ended with awards December the uponDecember 31, termination 31, the 2016, 2015, death of adjustments aexecutive of the were one was a Bank time excluded. related director item Forrelated of to related the to ($1.5 the Princeton the to year million) accelerated ended a acquisitionsecond and vesting December payout step ($840,000). of professional 31, under capital all For 2014, an transaction, fees one-time stock the $13.0 employment the option items contribution million agreement and related year of of with restricted to $20year ended compensation a stock the ended million expense plans former December acquisition to upon 31, of the 2013,non-cash the Investors Gateway, pre-tax completion OTTI Charitable completed acquisition of Foundation charges charge in the related and BFSB January of to of 2014, $977,000 $13.3 Roma were million Financial were were of excluded. excluded excluded. $5.6 For for million Pre-tax the the and year acquisition a ended December charges 31, 2012. related to Marathon and assets)bearing liabilities 0.88% 0.92% 0.76% 1.29x 0.83% 1.30x 0.77% 1.28x 1.15x 1.13x (1) The net interest rate spread represents(2) the difference between The the weighted-average net yield interest on margin interest-earning represents net(3) interest income as The a percent efficiency of ratio average interest-earning(4) represents assets for non-interest the The adjusted expense efficiency ratio divided represents non-interest by expense the divided by sum the sum of of net net interest income interest and income and Selected Financial Ratios and OtherPerformance Data: Ratios: Return on assets (ratio of net income to average total Return on equity (ratio ofNet net interest income rate to spread(1) average equity)Net interest margin(2)Efficiency ratio(3)Efficiency ratio — 6.06% Adjusted(4)Non-interest expenses to average totalAverage assets interest-earning 5.26% assets to average interest- 4.71%Dividend payout ratio(5)Asset 10.00% Quality Ratios: Non-performing assets to total 8.68% assetsNon-accrual loans to total loansAllowance for loan 1.64% losses toAllowance non-performing for loans(6) loan losses toCapital total 1.66% Ratios: loans 2.83%Tier 52.60% 1 leverage ratio(7) 1.96% 220.18% 2.91%Common equity 51.48% 3.04% tier 1 158.43% risk-based(7)Tier 1 risk-based 1.82% 139.10% 52.45% 3.08% capital(7) 52.93%Total-risk-based 3.12% capital(7) 124.30% 50.66%Equity 1.81% 104.29% to 51.69% 3.24% total assets 3.27% 0.47%Tangible 46.47% equity to 58.21% tangible assets(8) 3.26% Average 40.00% equity 3.37% to 0.69% average 52.06% assetsOther Data: 45.45% 1.21% 0.50% 49.66% 3.40% Book 0.81% value per 31.58% common share(8)Tangible 1.29% book 0.68% value per 19.61% 0.95% commonNumber share(8) of full service 1.33% 14.75% offices 0.72%Full time 6.02% equivalent 1.14% employees 15.87% 1.33% 0.77% 12.03% 1.36% n/a 1.16% 14.75% 13.10% 12.41% 15.99% 15.87% 15.43% $ 12.79% 10.18 17.12% 14.52% n/a 17.01% 18.60% $ 18.26% $ 8.20% 17.41% 10.14% 10.53 9.97 13.48% 7.90% 11.39% $ 16.16% $ 7.59% n/a 10.30 10.08 9.98% 15.85% 11.24% 7.67% $ $ 8.32% 19.06% 10.39 9.04 1,829 $ 151 8.92% 8.54% $ 9.85 8.89 1,734 $ 8.39% 140 9.81 1,682 132 1,541 1,193 129 101

FORM 10-K 8 xldsgowl n nagbeast o h aclto ftnil okvleadtnil qiy For equity. tangible and value book The tangible level. of calculation company the holding for assets the intangible at and goodwill retained Excludes capital (8) include not do and Bank Investors loans. share. restructured for per debt income troubled are net performing by and Ratios divided loans share non-accrual per include (7) paid loans dividends Non-performing represents ratio payout (6) dividend The (5) I eurmnsbcm fetv nJnay1 05 e Ie .Bsns uevso and Supervision — Business 1. shares. ESOP “Item unallocated and see shares treasury excludes 2015, calculation, share 1, common Basel January the as on time, that at effective effect in became Regulation”. requirements the requirements reflect 2015 31, III December to prior presented information 55

FORM 10-K 56 MANAGEMENT’S DISCUSSION AND ANALYSIS OFRESULTS FINANCIAL OF CONDITION OPERATIONS AND Since the Company’s initial public offering in 2005, we have transitioned from a wholesale thrift business to Our results of operations depend primarily on net interest income, which is directly impacted by the market The persistent low interest rate environment and a flattening of the yield curve over the past several years Our results of operations are also significantly affected byTotal general assets economic increased conditions. by While $2.29 the billion, or 10.9%, to $23.17 billion at December 31, 2016 from Capital management is a key component of our business strategy. We continue to manage our capital ITEM 7. a retail commercialcommercial bank. loans This and core transitionattributed deposits has (savings, to checking been and a primarilyacquisitions, money as market accomplished number well accounts). by as of Our productand increasing transformation expansion. the factors, can the We greater be believe New including amount York thefocus metropolitan of organic attractive is area, markets our to growth, will we build continue operatecommercial. de to and in, provide namely, develop novo us New profitable with Jersey branch customer growth opportunities. relationships openings, Our across primary bank all lines and of branch business,interest both consumer rate and environment.interest-earning Net assets, interest primarily loans incomeliabilities, and is primarily investment interest-bearing securities, the transaction and accounts, differenceis the time affected between interest deposits, by and we the borrowed the pay funds. interest levelrepricing on Net of our of income interest interest interest-bearing interest-earning income we rates, assets theon earn and our shape interest-bearing on mortgage-related of liabilities assets. the our on market our yield balance curve, the sheet, timing and of the the prepayment placement rate andhave the resulted in sustained pressurere-priced on at our yields net lower interestdeposit margin. than markets. Interest-earning the Despite assets overall these continue portfolio, headwinds, tothrough and we be interest have competitive originated earning been or asset pricing able growth. remainsslow to We but strong generally continue positive in to offset economic actively net both growthIf manage interest and the our short-term margin the loan interest potential interest compression and rate for rates risk additional increase,treasury against increases yield we a in curve may backdrop short-term steepen, be of rates we subject ininterest may the rates to experience near remain near-term an future. unchanged. net improvement in interest net margin interest compression. income, Should particularly the if short-term consumer continues tovelocity benefit of economic from growth, lower domestically and energy internationally, remains costs sluggish. and improved housing and$20.89 employment billion at metrics, December the while 31, securities 2015. increased Net by loansat $267.1 increased December million, $1.91 or billion 31, 8.5%, to 2015.loans, to $18.57 During $3.42 billion the $1.08 billion at year at December billion$523.3 ended December 31, December million 31, 2016, in 2016 31, in from 2016, commercial residentialother $3.15 we loans. loans, billion real Our originated $451.5 strategic $2.16 estate objectiveportfolio. million billion is We in loans, in to become understand multi-family construction more $608.9 theconcentration loans commercial heightened and bank million and like continue regulatory $260.0 and in to sensitivity maintain millionoverall be a around level commercial diligent in well-diversified of commercial in loan non-performing consumer and real our loans and underwriting remains estate industrial low and and compared credit loans, to multi-family risk our monitoring national and of regional these peers. portfolios.through The a combination ofmanagement organic and growth, acquisitions, prudentofferings, stock growth repurchases while allowed and being cash usdecreased mindful dividends. to to 13.48% of Effective at effectively capital tangible Decemberfirst 31, leverage book stock 2016 the from repurchase value 15.85% plan capital at for62.9 in December from March million stockholders. 31, 2015. 2015 the shares Our Since through at the Company’s capital December commencement an 31, public of to 2016, our average total the cost Company assets of has ratio repurchased $11.86 a has per total share of totaling $746.3 million. Stockholders’ equity was

FORM 10-K nomto hti spoal twl o olc l mut u ne h otata em fteloan the of terms contractual the under specific due has amounts management debt all if troubled collect a million an not with in $1.0 will loan modified than commercial it loans a greater probable is status, it loans is non-accrual if it commercial on impaired are be that other and allocations to information million and deemed Specific is $1.0 allocations. (“TDR”), loan general than A restructuring and greater impaired. specific be balance components: to two outstanding determined has loans losses for loan made for allowance the its of in loans these include will subsequent Company been the has loss. occurred, there loan loan has the not for for as deterioration in or allowance allowance If whether reflected the well the loans. determine of allowance of to those calculation as valuation adequacy loans to the no acquired losses, relation of on with in identifiable. evaluation analysis identifiable acquisition deterioration specifically quarterly We an of the performs specifically not required. date Company with but cover the the conjunction allowance probable loss, In on to are the losses. value losses loan of adequate fair certain for to amount allowance which is marked date. for the are losses sheet portfolio of acquired balance our loan Loans determination the in for at periodic inherent losses losses allowance and probable estimated timely our for allowance the that an for believe maintain responsible to required are are We we which environment under economic principles, judgment losses. the loan of in for degree allowance changes recorded high for the the potential of amount of the the because and to for changes management used, allowance in through by assumptions result the established could the policy determining that is for of accounting allowance methodology subjectivity critical The The the a income. date. involved, against considered sheet charged balance is is the losses that at loan losses portfolio loan loan for the provision in the inherent policies. losses accounting credit critical cover our assets be certain to of following value the carrying consider the We on policies. impact accounting material critical a be have, to could income or on have, or that assumptions significant make to to Policies Accounting continue Critical will We through changes. to and business organically continued both operational our payments. growth we dividend and and including offerings, and 2016, initiatives, grows management buybacks capital product stock company During risk strategic acquisitions, our our enhanced area. additional through as value built market expansion, personnel stockholder programs, our enhance key branch development in added novo and and acquisitions de training infrastructure opportunistic employee planned business and our our grow through people enhance to continue the our share to in intend market terminate We investments stockholders. our to our for strengthen agreed value create and will mutually that results parties financial producing both to approval, due 2017, regulatory January In around term market. Philadelphia timing long the in the its three transaction. and of Jersey ensuring New uncertainty in while branches the ten technology, operating work billion, $1.0 and to continues procedures team infrastructure AML and risk BSA the Our Company. the matters. for enhance sustainability compliance to Laundering Anti-Money diligently for and stock common Act of Secrecy shares million. million $82.3 totaling 31.3 share of per repurchase $0.26 of the dividends by cash 2016 as 31, well as December million ended $363.4 year the for impacted aaeetprom urel vlaino h dqayo h loac o onlse.Teanalysis The losses. loan for allowance the of adequacy the of evaluation quarterly a performs Management accounting accepted generally U.S. with accordance in determined been has losses loan for allowance The Losses. Loan for Allowance or discretion or judgment significant exercise to management require that policies accounting consider We while growth opportunistic and prudent on focus of a assets with strategies with business our Princeton, execute to of continue will Bank We the with agreement merger definitive a signed we 2016 May Bank In to regard with NJDOBI and FDIC the with agreement informal an into entered we 2016 August In h loac o onlse steetmtdaon osdrdncsayto necessary considered amount estimated the is losses loan for allowance The 57

FORM 10-K 58 Purchased Credit-Impaired (“PCI”) loans, are loans acquired at a discount due, in part, to credit quality. PCI On a quarterly basis, management reviews the current status of various loan assets in order to evaluate the The allowance contains reserves identified as unallocated. These reserves reflect management’s attempt to Our lending emphasis has been the origination of commercial real estate loans, multi-family loans, agreement. Impairment iscollateral-dependent measured loans, by the fair determiningThe value the general of present the allocationapplicable) value collateral and is adjusted of payment for determined expected history.and market adjustable future In by conditions rate addition, cash and loans segregating as the selling flowsReserves adjustable the Company’s expenses. for rate or, residential each loans remaining for are loan portfolioloss deemed loans segment is to experience or be subdivided by the subject over between to loss typeestimate a fixed more factors expected credit look-back of are losses risk generally as period if loan,expected interest of determined determined rates period losses risk based rise. to end. on of rating Additionally, provide the eachperiod management Company’s is the (if loan assesses the historical appropriate the segment estimated loss time amount andof from emergence adjusts the of the period date each loss for data of the (typically historical aCompany’s to loss past via loss event accurately loss the (such factor experience as first by accordingly. aor loan full personal The environmental segment. bankruptcy) or The loss factors to partial loss the emergence that factorshistorical actual loan are may recognition loss charge-off), also likely experience. be and to This adjusted iseconomic evaluation to cause conditions, determined account is estimated credit for based based credit concentrations, qualitative on upon lending lossessubjective among policies a as inherent other and it study in things, procedures requires of and the loan materialeconomic industry the and portfolio estimates trends, and delinquency that to but may trends, real differ is be general inherently losses estate from susceptible we to market have significant established conditions. revisions which based Actual could upon have loan changes a material in losses negative may effect on be our different financial results. loans than are the accounted allowancedetermined for for by in loan the accordance presentfor with value of loan ASC expected Subtopic losses). futurecarrying 310-30 The cash amount flows) and difference (fair with value) are between no ofthe initially the valuation the level-yield PCI recorded allowance method undiscounted loans, (i.e., at over or cash theexceed the the fair allowance flows “accretable life value the yield,” of expected is (as the undiscountedrecognized recognized at loans. as acquisition Contractually interest cash as required income and utilizing payments flowsnon-accretable a the for difference interest expected initial yield and to atincreases principal adjustment, the in that acquisition, expected accretable as cash yield flows orCompany a of analyzes may the the the loans occur loss actual and “non-accretablemade subsequent cash would accrual based result flow to difference,” on in versus actual or the an the loss areflows increase recognized forecasts loan a aren’t in as not and reforecasted, yield acquisition well any prior valuation on as dates adjustments acredit period’s changes events prospective estimated to allowance. due in that basis. cash credit the occurred to The flows probability loss Reclassifications during are of the expectations adjusted default. current are of to reporting For period. a reflect the period the in actual which cash cash received and adequacy of the allowancetheir for potential loan risk losses.shortfall In of results this in loss. a evaluation Loans recommendation process,probable. of determined specific a To specific to loans determine allowance are be orcollateral the analyzed charge-off impaired is if to adequacy the are based determine likelihood ofanalysis of evaluated on collateral loss on the for is on a evaluated most potential as a business.expenses. current loss This particular appraised exposure. appraised loan, value Any value an available for estimate for real real of property property the is or fair then a value reducedensure discounted of to that cash reflect the the flow estimatedestimates of overall liquidation probable credit allowance losses. reflects a margin for imprecisioncommercial and and the industrial uncertaintyoriginate home loans that equity loans and is andsecured the inherent by home real equity in origination estate lines property ofour and and credit. loan businesses These located purchase portfolio, activities in we New of resulted believe Jersey in and the residential a New primary concentration York. mortgage risks of Based on loans to loans. the our composition We loan of portfolio also are increases in interest rates, a decline in

FORM 10-K xetdt pl nteyaswe hs eprr ifrne r xetdt ercvrdo ete.The rates deferred settled. applicable, tax or the Where enacted during deductible. recovered income became using be taxable carryforwards future to measured and of expected generation are differences financial the are temporary upon (iii) the differences those dependent and which is temporary in asset in those bases; tax recognized periods when deferred of tax the been amounts years of respective carrying the have realization statement ultimate their in that financial apply and the events to between liabilities are differences expected of (i) to and liabilities: consequences attributable assets and are tax assets (ii) existing tax returns; future deferred tax Accordingly, expected or method. statements the liability and for asset the recognized using allowance amended, the as to Taxes,” examination. adjustments their of recognize time to periodically the at us will them require process, to may examination available information their agencies about of Such judgments to relevant part losses. their subject New integral on loan uses is the based an for and that as Management Corporation allowance estimate Insurance, Insurance our an deteriorates. Deposit and review remains Federal Banking losses environment the of loan addition, Department economic In for Jersey change. allowance current is short-term the and analysis of the judgment level an significant if the after however, off necessary available; charged information be generally may are carrying Loans additions loan’s collateral. doubt. the the in that is of determine balance principal value to full assessed fair the individually of the collectability are of that loans indicates excess the which in completed that fact not the is to value due mitigated been has costs selling has estimated process the reflect foreclosure to Thereafter, market. the loans delinquent. estate and residential real days status of the 90 non-performing value in in becomes appraised declines remains the loan and loan adjusts a Management the event completed. if the been years in not two appraisal every updated updated an is are and appraisal reserves loan the specific the of additional origination that if determined assessing the in is of estimate used it an is If appraisal, received. value is new is warranted. appraisal a appraised appraisal updated ordering are the updated existing warrant until occurred. appraisal an to the necessary has enough if previous to significant value determines the adjustments is collateral management value downward to of conditions, collateral adjustments deterioration the market of possible in downward deterioration if in changes if its changes identify the or from of of to knowledge information warranted severity area department’s utilizes the lending assets Company on our special The Based in and loan. has department conditions the there specific credit supporting estate whether the its value real assesses collateral determine and rated collateral and each to officers reviews impaired the order loans lending Company and/or in the in commercial non-accrual change process, for done as loss adverse is loan classified an annually for This loan been allowance greater. estate the loans obtained or real of for part biennially million commercial is As obtained $2.0 dependent needed. is of appraisal off appraisal charge balance updated or An a updated reserve greater. with or An mention $500,000 of special origination. balance rated a with upon worse or loans substandard The could dependent determined. assumptions allowance collateral related appraisal reasonably the values to resulting and the changes loan that loans. in determine a related Negative to the critical securing on reviewed are realizable properties. carefully property are increased amounts are loans reflect valuations a of appraisals in securing appraisal of such for resulting property supporting value valuation Assumptions assumptions of portfolio the loans. the value specific impact loan determining for underlying portfolio significantly our required loan the in our allowance affect of of the amount instrumental appraisals of adversely substantial amount a estate, may As the real provisions. determining states. events loss by surrounding loan and of these collateralized York levels New is future of Jersey, and New losses combination in loan values delinquencies, or market estate one real in Any declines and economy, general the eerdIcm Taxes. Income Deferred levels, adequate at losses loan for allowance the maintained and established have we believe we Although loans non-performing other and impaired for appraisals outdated for risk potential the believes Management the upon appraisal an obtain to is policy Company’s the loans, mortgage residential homogeneous For all for appraisal an obtains Company the loans, construction and multi-family estate, real commercial For h opn eod noetxsi codnewt S 4,“Income 740, ASC with accordance in taxes income records Company The 59

FORM 10-K which permits an entity to The initial asset recognized for originated MSR is 60 Certain of our assets are carried on our consolidated balance sheets at cost, Goodwill is presumed to have an indefinite useful life and is tested, at least In connection with our annual impairment assessment we applied the guidance in FASB ASU 2011-08, Our available-for-sale portfolio is carried at estimated fair value, with any unrealized gains or losses, net of If a determination is made that a debt security is other-than-temporarily impaired, the Company will Goodwill Impairment. Valuation of Mortgage Servicing Rights (“MSR”). The estimated fair value of MSR is obtained through independent third party valuations through an analysis Asset Impairment Judgments. annually, for impairment atexceeds its the implied reporting fair unit value.single For reporting level. purposes unit. Impairment of our exists goodwill when impairment the testing, we carrying have amount identified the ofIntangibles Bank goodwill — as a Goodwill and Other (Topic 350): Testing Goodwill for Impairment, fair value ornecessary at to the recognize lower impairmentsuch of of assets. such cost In assets.impairment addition or We analysis to fair periodically is the the perform value.of determination analyses impairment one Valuation of or to analyses whether more allowances there test of related has or our for to been securities. impairment write-downs an our of other-than-temporary are loans decline established in discussed the when above, value anothertaxes, reported significant as accumulateddoes other comprehensive not income intend or to losssecurities sell in before these stockholders’ equity. securities, their Whilesecurities. and anticipated the it Our Company recovery is held-to-maturity more ofsecurities portfolio, likely for the consisting than which remaining primarily not weconduct that carrying of have a we periodic value, mortgage- a will review positive backed we notdeclined and intent securities evaluation be have below and of required and the ability the its to otherutilizes securities ability to sell cost various portfolio debt hold these to inputs to or to to determine sell determine maturity,positive amortized if or the the is the negative cost, fair value carried effect value of on and at of our any the carrying consolidated whether security portfolio. financial value. has such condition The We or use decline results of of different is operations. assumptions could other-than-temporary.estimate have the Management a amount of thecredit unrealized loss related that is component attributableincome to as will credit a and be component all ofadjustment other recognized gain non-credit to (loss) accumulated related as on other factors. comprehensive The securities, an income, net. net The other-than-temporary of non-credit tax. related impairment component charge will be in recorded as non-interest an make a qualitative assessment ofcarrying whether amount it before is more applying likely theour than two-step qualitative not goodwill assessment that impairment concluded a test.is that reporting less For unit’s it than the fair was its value year not carrying is ended more amount less December likely and, than 31, therefore, than its 2016, the not two-step that goodwill the impairment fair test value was not ofmeasured required. the at reporting fair unit value. Thesold fair with value servicing of released. MSRincome. MSR is are We estimated by amortized apply reference in thebased to proportion amortization current to on market method and fair values over for ofthrough value the similar measurements charges period loans at to of of earnings each our estimated asimpaired a MSR. reporting net MSR component servicing MSR date. of are are fees MSRearned recognized and assessed for impairment, service only for servicing charges. if loans impairment up Subsequent are increases any, to reported in as is the the income fair recognized amount when value the in of of related mortgage the a loan previously valuation payments are recognizedof allowance collected. valuation future allowance. cash Fees flows, incorporating assumptions market participants would use in determining fair value tax assets are reducedon by deferred a tax valuation assets allowance andenactment. for liabilities The any of valuation portions a allowance determined change isand not in circumstances adjusted, likely tax warrant. by to rates a be is charge recognized realized. or in The credit income effect to tax income expense tax in expense, the as period changes of in facts

FORM 10-K n euiisicesdb 271mlin r85,t 34 ilo tDcme 1 06fo 31 ilo at billion $3.15 from 2016 2016, 31, 31, December December at at billion billion $3.42 $18.57 to to 8.5%, billion or 2015. $1.91 million, 31, increased December $267.1 loans by Net increased 2015. securities 31, and December at billion $20.89 2015 31, December and 2016 in 31, directly December recognized at Condition be Financial would of Comparison derivatives Comprehensive the Other of affects value Accumulated transaction fair forecasted in in derivatives hedged recorded change the of that the initially value period of fair is earnings. the portion the in hedges ineffective in earnings The flow into changes earnings. reclassified of cash subsequently portion as is effective consolidated and qualify the The Income in that value. liabilities fair and or at assets designated either condition as financial recorded of are statements which instruments volatility financial derivative price share time-to-time, stock per different expected materially in as result increase could models generally decreases. risk-free pricing yield yield. option will volatility, dividend options. dividend different of expected price options or expected values and stock assumptions fair the increases of different term in expected fair of value option changes the use expected share as fair The increases, in per direction rate share the changes opposite interest general, the per risk-free as In increases, in direction the assumptions. and markets. same in term, example, public changes the option on For to expected traded in sensitive and not pricing move highly rate are option nature, will is interest that Scholes in options options options 718, Black- of subjective to of value The applied are ASC value fair when precision. assumptions share with limitations with These per inherent determined accordance The term. certain be in contains option cannot stock also expected awards expected therefore, model grant yield, and of and, those dividend date rate expected uncertainties the of the interest on involve for value grants risk-free assumptions option using volatility, fair of model be value price pricing grant-date fair option not share Black-Scholes the may per the the using assumptions on estimate conditions We those based the Compensation”. and by “Compensation-Stock instruments limited time, equity is in MSR of point our of particular time. value a in point fair of different the a increase as at of an applied utilized in measurement are results they any assumptions which if Thus, appropriate down, the slow MSR. in prepayments and decrease of loan a mortgage value existing rates in rise, interest results fair rates as which interest the Generally, activity, As MSR. in refinance MSR. our increased of of to value value due fair fair the accelerate the prepayments on loan impact mortgage significant decline, most the have generally conditions. assumptions market are anticipated assumptions and All current impairment. reflect of they ensure measurement to the basis in allowance other quarterly changes valuation a and reflect The on rates movements. to reasonableness rate periods for default interest reviewed subsequent costs, future in of servicing adjusted perception then income, market’s is servicing the including speeds, data, prepayment driven market rates, discount market including oa Assets. Total Instruments. Financial Derivative Compensation. Stock-Based speed prepayment in Changes assumptions. in changes to sensitive highly is MSR of value fair The oa sesicesdb 22 ilo,o 09,t 2.7blina eebr3,21 from 2016 31, December at billion $23.17 to 10.9%, or billion, $2.29 by increased assets Total ercgietecs fepoe evcsrcie necag o awards for exchange in received services employee of cost the recognize We spr foritrs aers aaeet emyuiie from utilize, may we management, risk rate interest our of part As 61

FORM 10-K Amount December 31, 2015 # of Loans Amount December 31, 2015 March 31, 2016 # of Loans (Dollars in thousands) Amount June 30, 2016 December 31, 2016 # of Loans (Dollars in millions) 62 Amount September 30, 2016 # of Loans Amount December 31, 2016 # of Loans Multi-family loansCommercial real estate loansCommercial and industrial loansConstruction loansResidential mortgage loansConsumer and other 1,275,283 4,452,300 $ 7,459,131 1,044,385 3,829,099 4,711,880 6,255,904 314,843 5,039,543 597,265 225,843 496,556 loan costs (12,474) (11,692) Net loans increased by $1.91 billion, or 11.5%, to $18.57 billion at December 31, 2016 from Total LoansNet unamortized premiums and deferred Allowance for loan lossesNet loans (228,373) 18,810,702 16,891,330 (218,505) $18,569,855 $16,661,133 Commercial Loans: Total commercial loans 13,501,557 11,355,231 During the year ended December 31, 2016, we originated $2.16 billion in multi-family loans, $1.08 billion The following table sets forth non-accrual loans (excluding PCI loans and loans held-for-sale) on the dates Net Loans. restructured loanstotal loans 42as a percent of $non-accrual loans 9.4as a percent of 31 total loans $ 8.8 242.24% 0.50% 29 $ 12.1 229.31% 30 0.53% $ 10.7 219.6% 39 1.21% 0.57% $ 22.5 205.83% 1.22% 0.61% 189.30% 1.25% 0.68% 1.26% 1.29 % consumer 478 79.9 481 86.1 471 86.5 488 85.9 500 91.1 industrial 8 4.7 6 2.3 6 0.7 10 5.6 17 9.2 Accruing troubled debt Non-accrual loans to Allowance for loan loss Allowance for loan loss Total commercial loansResidential and 34Total non-accrual loans 14.4 512 $ 36 94.3 517 11.4 $ 97.5 42 513 13.8 $100.3 539 51 $ 105.2 562 19.3 $ 115.4 62 24.3 Multi-familyCommercial real estateCommercial and 24Construction 2 9.2 $ 29 0.5 0 1 8.9 $ 33 — 0.2 11.7 0 2 35 $ 1.2 — 10.3 3 37 1 $ 2.9 10.8 0.2 4 3 $ 3.5 0.5 4 0.8 in commercial real estateloans, loans, $608.9 $451.5 million million inloans in commercial reflects construction and our industrial continued loans focus loans,and and on $523.3 industrial generating $260.0 million multi-family loans, million in loans, which residential properties commercial in was real consumer and partially estate loans and offset businesses andportfolio, other by commercial located pay loans. our in downs This mortgage and NewDecember increase payoffs subsidiary, 31, Jersey in 2016 of Investors and in loans. residential Home New Our mortgage loans loans Mortgage, York. that are originated In were primarily sold addition $245.8 to on third to million party investors. indicated the for as loans the well as originated year certain asset for ended quality our ratios: $16.66 billion at December 31, 2015. The detail of the loan portfolio (including PCI loans) is below:

FORM 10-K eoisbcuecr eoisrpeetamr tbesuc flwcs ud n a els estv to sensitive less be may and funds core cost more low attracting accounts), of of market plan source our money stable to and committed more rates. remain checking interest a We market (savings, represent products. in changes core deposits deposits cost core core lower because of attracting deposits mix on deposit a focused in is resulting strategy 2015. deposit the 31, Our to December stock at related 31, million FHLB December $4.7 primarily on at and is impact million 2016 $159.2 31, an FHLB and December has 2016 the at 31, borrowings million from in December $14.5 in 2016 at own was increase 31, million assets we $161.9 the December Other was 2015. stock therefore at insurance million FHLB, of life $237.9 owned the amount Bank to from The owned. 33.3% borrowings 2015. or our million, 31, of $59.5 December balance by at increased million FHLB at the billion $178.4 in $3.15 own from we sales. 2016 stock and 31, paydowns by December offset at partially purchases billion of $3.42 result a to was 8.5%, increase This or 2015. million, 31, December $267.1 must by analysis increased risk aggregate, The other and objectives. appreciation management and/or purchased. when yield asset/liability available-for-sale for or prospects overall each held-to-maturity measurement, as of our classified capital analysis are risk-based thorough to Securities our a factors. upon on conforms based effect it are its invest decisions consider may determine Purchase Bancorp other limitations. Investors to to certain addition, Treasury loans to In security short-term U.S. funds. subject and mutual securities to, and overnight mortgage-backed equity instruments, limited institutions, in subdivisions, debt financial not Municipal corporate insured grade and are of investment State deposit banks, but Jersey Agencies, of include, New certificates Federal and certain may various securities, Federal by purchased to issued investments conform securities Our transactions obligations, investment regulations. that investment requires State Policy 1.21%. Investment was our loans Our in total enhancement. conditions of percent economic a the as as and loss well delinquency loan the for as loan on allowance based of lending the our necessary level 2016, of be estate the 31, growth may December real portfolio, losses the At loan loan to commercial area. for the lending due with allowance of is the composition associated losses in and loan risk increases growth Future for credit loans. allowance industrial inherent our and in the commercial increase particularly The portfolio, 2015. 31, loan relationship December well-collateralized at single and million a tenant $218.5 is single loans. are loans these all relationship problem monitoring this actively potential is for million Management in properties $1.7 ratios. The value totaling Included to million. loans loan million. of industrial $40.4 strong with $6.4 As of and for status. comply comprised commercial loans totaling were non-accrual to 8 8 loans which on borrower million, totaling loans placed the multi-family $38.4 problem be of totaling 3 potential to ability loans of loan and the estate million the to real $46.5 cause identified as commercial may Company 11 concerns which the have and were 2016, we terms 31, million repayment which December loan $20.9 about current loans and the as accruing with defined are as loans classified problem were million $9.4 debt of Troubled troubled 2016. loans. amount as 31, real multi-family December deemed commercial were the at were $248,000 loans non-accrual in as and million of classified loans $3.6 loans million industrial loans, percent $30.4 and restructured consumer a commercial were as and debt were there loss million residential loan 2016, $1.7 were for time loans, 31, million allowance of estate December $24.8 our period 2016, long At which 31, a of 1.21%. December takes restructurings, was At it area. however loans lending loans, total our troubled of in our credits resolve residential diligently resolve to to continue We 2015. 31, December oa o-cra on erae o$43mlina eebr3,21 oprdt 154mlinat million $115.4 to compared 2016 31, December at million $94.3 to decreased loans non-accrual Total Deposits. Assets. Other and Insurance Life Owned Bank Bank, Loan the Home in Federal Securities, the assets. in Stock total our of 14.7% represented portfolio securities our 2016, 31, December At Securities. from 2016 31, December at million $228.4 to million $9.9 by increased losses loan for allowance The Potential loans. problem potential for portfolio our monitor to continue we loans, non-accrual to addition In tDcme 1 06 eoisttld$52 ilo,rpeetn 62 forttlliabilities. total our of 76.2% representing billion, $15.28 totaled deposits 2016, 31, December At euiisaehl rmrl o iudt,itrs aers aaeetadln-emyield long-term and management risk rate interest liquidity, for primarily held are Securities 63 h mutof amount The

FORM 10-K 64 The following tables set forth average balance sheets, average yields and Stockholders’ equity decreased by $188.4 million to $3.12 billion at December 31, We borrow directly from the FHLB and various financial institutions. Our FHLB Net interest income represents the difference between income we earn on our interest-earning assets and the Average Balances and Yields. Deposits increased by $1.22 billion, or 8.7%, from $14.06 billion at December 31, 2015 to $15.28 billion at Borrowed Funds. Stockholders’ Equity. 2016 from $3.3131.3 billion million shares at of$82.3 December common million 31, stock for 2015.$192.1 for $363.4 million The for million the the as decrease year ended year well is December as 31, ended primarily cash 2016. dividendsAnalysis attributed December of of Net to $0.26 31, Interest Income the per 2016. share repurchase totaling These of decreasesexpense were we pay offset onassets and by interest-bearing interest-bearing liabilities liabilities. net and Net the income interest interest rates income earned of on depends such on assets and the paid volume oncosts, such and of liabilities. certain interest-earning other informationthe for effect the periods thereof indicated.included was No in not tax-equivalent yield material. the adjustmentsreserved All computation were for made, average of as and balances average notdiscounts are balances, included and daily in however premiums that interest average interest are income. balances. amortized receivable The or Non-accrual on accreted yields to loans these set interest were forth income loans or below have expense. include been the fully effect of deferred fees, December 31, 2016. Total checking$4.64 accounts billion increased at $1.45 December billion 31,80.7% to 2015. of $6.09 At billion December total at 31, deposits,$2.95 2016, December of we 31, which held 2016 billion, $12.33 from $736.8 billion$687.8 million or in million are core of deposits, 19.3%, brokered brokered representing certificates money of of market deposits. deposits. our At December total 31, 2016, depositborrowings, balances frequently referred weremortgage to certificates portfolios as as advances, of39.3%, well are deposit, as to over qualified $4.55 of collateralizedcontinued investment billion growth by securities. which of at the our Borrowed loan included residential December funds portfolio. and increased 31, by non-residential 2016 $1.29 from billion, $3.26 or billion at December 31, 2015 to help fund the

FORM 10-K e neetmri()30%31%3.27% 3.08% volume in 3.12% (changes volume in changes to $541,971 attributable by multiplied effects rate the in (changes shows rate column in changes volume to attributable The effects volume). the 2.91% shows prior column rate The indicated. periods of assets. interest-earning cost Analysis total 3.04% the Rate/Volume average by and divided $595,084 assets income liabilities. interest interest-earning interest-bearing net total average represents less margin on assets interest interest-earning yield Net 2,798,510 total the represent assets between (3) interest-earning difference Net the represents (2) spread rate interest Net 2.83% (1) $640,185 interest-earning of Ratio 3,451,497 margin(3) interest Net 2.18 59,685 interest-earning Net 2,741,609 spread(1) rate interest Net income 2.07 interest Net 0.95 65,225 3,172,741 30,149 3,157,311 0.58 3,180,032 0.35 13,664 732,469 1.87 8,755 2,355,982 equity 0.30% 1.05 71,279 Stockholders’ 6,638 31,234 2,478,047 3,816,087 0.68 $ 2,241,747 4.50 2,972,611 $ 24,136 0.29% 0.35 6,861 Non-interest-bearing 6,402 9,642 3,564,311 1.07 $ 152,330 2,235,703 33,864 $ 2,735,513 0.65 0.30% 3,161,843 funds Borrowed 25,621 6,304 4.38 770,262 3.99 0.48 $ 3,925,095 2,096,769 603,438 6,881 16,268 $ 13,776,250 deposit of 3,381,909 Certificates 172,367 accounts 4.22 market Money 663,424 checking 2.42 Interest-bearing 15,716,010 deposits 0.15% 4.45 31,847 Savings 552 9,120 4.10 1,315,604 Interest-bearing 715,901 $ 204,735 371,636 17,479,932 2.26 779,138 $ 38,547 0.11% 225 assets 1,708,176 Non-interest-earning $ 207,331 2.32 $ 42,643 0.24% FHLB in Stock 342 1,836,692 loans Net held-to-maturity $ Securities 144,610 $ Securities deposits Interest-bearing assets: Interest-earning ern iblte .913 1.28 3,584,372 $ 1.30 4,384,180 $ 1,518,331 1.29 4,682,639 $ liabilities bearing interest- total to assets 1,702,945 assets(2) 2,289,036 liabilities 1.88 18,164 965,969 liabilities: 1.82 22,646 1,245,745 1.82 25,515 1,398,373 available-for-sale oa iblte 860791,6,9 14,515,748 liabilities. interest-bearing average 16,368,394 18,670,739 $17,314,258 and liabilities Total liabilities Total interest-bearing Total $19,819,891 interest-bearing Total $21,843,480 assets Total interest-earning Total h olwn al rsnsteefcso hnigrtsadvlmso u e neeticm o the for income interest net our on volumes and rates changing of effects the presents table following The qiy$18340$98981$17,314,258 $19,819,891 0.91 $21,843,480 118,891 0.58 12,997,417 59,206 0.93 10,255,808 136,639 14,665,449 equity 0.62 stockholders’ 71,414 0.94 153,336 11,508,138 16,381,703 0.65 82,057 12,565,616 liabilities 3.99 660,862 16,581,789 deposits 3.84 731,723 19,049,629 3.77 793,521 21,064,342 assets Outstanding Average Balance 2016 Earned/ Interest Paid Average Yield/ Rate o h erEddDcme 31, December Ended Year the For Outstanding 65 Average Balance Dlasi thousands) in (Dollars 2015 Earned/ Interest Paid Average Yield/ Rate Outstanding Average Balance 2014 Earned/ Interest Paid Average Yield/ Rate

FORM 10-K Net Increase (Decrease) Rate 2015 vs. 2014 Due to Years Ended December 31, Increase (Decrease) Volume (In thousands) Net Increase (Decrease) Rate 2016 vs. 2015 Due to 66 Years Ended December 31, Increase (Decrease) Volume Total interest and dividend income increased by $61.8 million, or 8.4%, to Net interest income increased by $45.1 million, or 7.6%, to $640.2 million for the year Total interest expense increased by $16.7 million, or 12.2%, to $153.3 million for the Net income for the year ended December 31, 2016 was $192.1 million compared to net income Net Income. Net Interest Income. Interest and Dividend Income. Interest Expense. Total interest-bearing liabilitiesIncrease in net interest incomeComparison of Operating Results for the Year Ended December 31, 2016of and $181.5 2015 million for the year ended December 31, 19,380 2015. (2,683) $65,548 16,697 (20,447) 45,101 15,713 $ 86,295 2,035 (33,182) 53,113 17,748 Total depositsBorrowed fundsended December 31, 2016decreased from $595.1 8 million basis forDecember points the 31, 2015. year to ended 3.04% 12,607 December 6,773 31, for 2015. the The net year (6,553)$793.5 interest ended million 3,870 margin for December the7.9%, 31, year to 6,054 2016 ended $715.9 10,643 million December from forthe 31, the 3.12% average 2016. year balance Interest ended for of December income thethe net 31, on 2016, loans growth year loans as to in a increased 8,668 ended $17.48 result the 7,045 byweighted billion of $52.5 commercial for average a the million, $1.8 loan yield year billion, or portfolio. (3,128)totaled or ended on 11.2%, This December $22.0 net increase 5,163 31, increase in million loans 2016, wasDecember primarily to for offset attributed 5,540 4.10%. the 31, by to 12,208 Prepayment a year$9.3 2015. penalties, decrease ended million, of which Interest December or 12 are 31,$250.8 income basis 13.6%, included 2016 points million in to on compared in interest $77.6$3.58 increase to the all income, billion million $21.0 in for other for the millionassets, the year the interest-earning for excluding ended loans, year average the December increased assets, 31, 12 ended year balance basis 2016. excluding ended points December In to of addition, 31, loans, 2.17%. the all 2016 weighted increased average which other yield by is on interest interest-earning attributable earning to a assets, excluding loans, to Total interest-earning assetsInterest-bearing liabilities: Savings depositsInterest-bearing checkingMoney market accountsCertificates of deposit 84,928 (23,130) 61,798 102,008 (31,147) 2,576 70,861 4,050 2,524 (351) (1,039) 6,626 2,024 253 1,485 606 908 (98) 8,229 2,630 2,243 (21) (2,047) (45) 10,472 887 3,132 (191) 1,085 (236) year ended December 31,to 2016. Interest $82.1 expense million on forincreased interest-bearing the deposits $1.06 year increased ended billion, $10.6weighted million, December or or 31, average 14.9%, 9.2% 2016. cost to The average $12.57 of balance billion interest-bearing of for total deposits interest-bearing the deposits increased year 3 ended basis December 31, points 2016. to In 0.65% addition, for the the year ended Interest-earning assets: Interest-bearing depositsSecurities available-for-saleSecurities held-to-maturityNet loansStock in FHLB $ 2,772 (86) 3,103 203 97 993 2,869 117 4,096 $ 5,112 (203) 1,387 8,367 77,752 (630) (124) (25,275) (1,667) 52,477 852 4,482 6,700 (327) 2,239 87,885 (27,899) 59,986 847 (827) 20 multiplied by prior rate).changes The attributable net to both columnbased rate represents on and the the changes volume, sum due which to of cannot rate the and be the prior segregated, changes columns. have due to For been volume. allocated purposes proportionately, of this table,

FORM 10-K h opn prts eas a ae ifraogsc uidcin;adteipc faymtra but material any of of impact level the where overall and jurisdictions the jurisdictions; local to such and relative among state purposes differ various the tax rates to items. for tax occurring apportioned deductible because infrequently and not operates, allocated income expenses Company of of the level level the the income; income; pre-tax pre-tax from and of realized 2015 level in benefit enacted tax acquisition. reform prior a law a tax includes on City carryforward 2015 York loss New 31, operating the net December of a ended result to a related year as item the discrete asset a tax for deferred rate Company’s tax the revaluing The 2016. 31, December 2016 reported previously to ASU. Adjustments this forfeitures. of 2016-09. for adoption No. accounting the ASU reflect and adopted to of flows, Company made cash classification the were of 2016 periods consequences, statement interim of the tax quarter on income fourth classification the the liabilities, of In or including aspects equity several transactions, either simplifies payment as 2016-09 awards share-based No. for ASU accounting Accounting.” Payment the Share-Based Employee to Improvements respectively. 2015, 31, December and 2016 risk and additional $840,000 and acquisition. is Princeton enhance million training 2016 of 31, to employee Bank $4.0 December the our continue ended of increased enhance months termination we three announced we as expenses recently the and the for 2016 to grows operating fees related 31, professional company other in our December Included as and programs. ended development infrastructure year fees operational the Professional and primarily executive for 2016 management openings. 2016. 31, supplemental respectively of December and branch ended quarter million, in year fourth plan $2.3 the new the million pension for during as million $1.7 Directors to benefit $5.4 of well approximately increased defined Board due to expense as the of the equipment staff by infrastructure; and both decreases approved our occupancy operating was of by Office that to and freezing plan offset additions management replacement the partially wage risk Plan; to retirement were our Incentive related increases of Equity expenses of These out directors benefit 2015 and increases. build resulting Inc. officers 2016 continued merit employees, Bancorp, 31, certain and normal December Investors to growth ended 2015 primarily the year 23, our was the June to support increase on for Compensation pursuant The grants expense 2015. option 2016. Company, incentive 31, stock 31, equity the and December December in stock ended ended million restricted year $12.8 year the the of the from to increase for compared an million to as $20.4 due 9.2% increased or securities benefits million, fringe of $30.2 and sale of the increase an to 2016, due in primarily million 2016 $2.1 of 31, million. increase December $3.1 an of ended by as gain 2016 year offset a 31, in were the In December resulting decreases year. ended million, for over These $69.1 year transactions year totaling the 2015. consistent for securities 31, were million December on subsidiary $1.5 as ended mortgage decreased gain primarily year our owned 2016 estate at the 31, real sales to December other Loan ended compared of Bank. year sale the the on at for gain sales decreased addition, loan net fewer loans, of on result Gain a 2016. 31, points December basis ended 20 year 2016. of 31, decrease December a ended by year offset 20.9%, the was for or 1.87% increase million to This $658.8 borrowings 2016. increased of for 31, funds cost million December average borrowed $71.3 ended weighted of to year the balance 9.3%, in the or average for million, The billion $6.1 2016. $3.82 by 31, to increased December funds ended borrowed year on the expense Interest 2016. 31, December h fetv a aei fetdb h ee ficm andta seep rmtxrltv oteoverall the to relative tax from exempt ended is that year earned income the of level for the by affected million is rate $10.4 tax effective of The benefit tax a in resulted 2016-09 No. ASU of adoption The 718): (Topic Compensation “Compensation-Stock 2016-09, No. ASU issued FASB the 2016, March In Taxes. Income Expense. Non-Interest Income. Non-Interest noetxepnews$0. ilo n 9. ilo o h er ne eebr31, December ended years the for million $99.4 and million $106.9 was expense tax Income oa o-neeticm erae y$. ilo,o .% o$72mlinfrthe for million $37.2 to 7.3%, or million, $2.9 by decreased income non-interest Total oa o-neetepnews$5. ilo o h ereddDcme 31, December ended year the for million $358.6 was expense non-interest Total 67

FORM 10-K 68 Total interest and dividend income increased by $70.9 million, or 10.7%, to Total non-interest expense decreased by $11.5 million, or 3.4%, to $328.3 million Total non-interest income decreased by $1.7 million, or 4.1%, to $40.1 million for the Net interest income increased by $53.1 million, or 9.8%, to $595.1 million for the year Total interest expense increased by $17.7 million, or 14.9%, to $136.6 million for the Net income for the year ended December 31, 2015 was $181.5 million compared to net income Net Income. Net Interest Income. Interest and Dividend Income. Interest Expense. Non-Interest Income. Non-Interest Expense. Comparison of Operating Results for the Year Ended December 31, 2015 and 2014 of $131.7 million for the year ended December 31, 2014. ended December 31,December 2015. 31, 2015 The from 3.27% net for the interest year margin ended December decreased 31, 2014. 15 basis$731.7 points million to for the 3.12%9.9%, year to for $663.4 ended million the December forthe 31, year the average 2015. year ended balance ended Interest December of income 31,the net on 2015 loans average as loans to a balance increased $15.72 result byincreasing of billion of a $1.20 $60.0 for multi-family $1.94 billion, the million, billion, loans, $732.5 year or orof million ended 14.1%, commercial residential increase December and loans real in 31, $427.1 decreasing 2015, estate million, $424.4on primarily respectively, million loans net attributed for partially and the to loans offset year commercial by decreased endedwhich the 16 December and are average 31, basis industrial included 2015. balance points The loans in$16.3 to weighted interest average 4.22% million yield income, for increased for theexcluding to year the loans, $21.0 ended increased year million December bywhich for 31, ended $10.9 2015. the is million, December Prepayment year or attributable penalties, ended 31, 18.9%,excluding to December to loans, 2014. a 31, to $68.3 $3.33 Interest 2015 $528.1 million billionearning from for million income assets, for the excluding the increase on year loans, year was in ended ended all 2.05% December December the for other 31, 31, the average 2015. years 2015 interest-earning ended The balance December weighted assets, of 31, average 2015 yield all and on 2014. other interest- interest-earning assets, year ended December 31,to 2015. Interest $71.4 expense million on forincreased interest-bearing the deposits $1.25 year increased billion, ended $12.2weighted million, December or or 31, average 12.2% 20.6%, 2015. to cost TheDecember 31, average $11.51 of 2015. balance billion Interest interest-bearing of expensethe for total on year deposits the borrowed interest-bearing ended funds deposits increased December year increasedto 31, by ended 4 $3.16 2015. $5.5 billion December The million, basis for average or 31, thein 9.3%, balance points the year 2015. to of weighted ended $65.2 to borrowed average In December million cost funds 31, for addition 0.62% of increased 2015. borrowings $415.7 the This to for million increase 2.07% or for was the the 15.2%, offset year by year ended a December decrease ended 31, of 2015. 11 basis points year ended December 31,other 2015. income The of reduction $2.3 isother million mainly and income attributed $1.6 for to million, the decreasesrelating respectively, in to year for fees the ended the and acquisition year DecemberGCF service of ended 31, charges Bank Gateway December 2014 and Community 31, (“Gateway”), was Financial 2015.increase which a Included Corp, of was $2.5 in the bargain million completed federally-chartered purchase in holding in gain gain on company January of loans for sales, 2014. $1.5 net million, These for the net decreases year of ended were December tax, for partially 31, 2015. the offset by year$20.0 an ended million December to the 31, InvestorsIn Charitable 2015. addition, Foundation Included FDIC in conjunction insurance incontinued with premium the the improvement decreased second in year step $5.3 asset capital ended million qualityservice offering and for December fees in additional the 2014. decreased 31, capital year $3.0 raised 2014fringe ended million in December is benefits the for 31, second the a increased step 2015 yearrelated contribution $14.3 offering. due ended Data to of to million December processing the the 31, for$13.0 2015 2015 the to million Equity year $22.4 Incentive million. related endedcompletion Plan. Compensation of December to and the For 31, second the the 2015, step accelerated 2014 capital which offering period, vesting included in compensation May $9.2 of 2014. expense million In all included addition, stock a for the charge option year of ended and December 31, restricted 2015, stock awards upon the

FORM 10-K aers eot.Temdlpoet e neeticm ae nvrositrs aeseaisadhorizons. and scenarios rate interest various on based risk income interest low net relatively projects in model The term invest reports. shorter primarily risk their rate securities. we to term longer due addition, to risk compared In yields rate lower loans. and interest lives mortgage our in average shorter growth reduce residential have the help generally rate outpaced which estate rate generally securities, have real fixed years, variable which commercial which to of recent loans, Our origination of industrial in compared products. The and portfolio mortgages, may environment. rate commercial products rate residential residential fixed and Fixed-rate rising the loans fluctuations. a in of rate multi-family in was interest comprised income particularly to 65% interest loans, exposure was net our while our portfolio reduce products, impact to loan adversely helped rate and have total variable assets deposits related our in our mortgage was of of 35% 25.1% value approximately intrinsic 2016, the 31, as December on well have may as rates portfolios, those interest securities market of in and effect changes loan estimated that effect our the estimated of strategies, the borrowings. the reviews value and and Directors margin lending, economic activities of interest our the Board aforementioned net modify our our the may basis, on quarterly report, and strategies our a requirements Committee Liability in On liquidity Asset inherent Liability accordingly. and Our risk strategies Asset rate rates. capital the gathering to interest interest and deposit reduce, the market and environment to evaluates in investing operating policy executives, changes our our and to with sheet, management income consistent senior balance interest manner of a net consists in our which risk of Committee, that exposure manage the then possible, and extent model business our from given deposits. to risk of arising borrowers flow risk” of and ability mix curve the the and originations, “yield prepayments loan can loan and new of rates of indices; volume interest rate sheet the market and different loans, in amount off-balance rate Changes of the variable rates. and influencing repay uses interest by liabilities of income the structure interest assets, behavior term from net the the our affect in across arising difference of relationships rates the rate re-pricing activity; interest funding deposit changing or prepayments, and loan flow lending of cash effect of the the commitments); in loan (i.e., differences contracts timing from results loss operating net a in include increasing Risk taxes Market rate of income Management tax 2015 effective 31, for Company’s million. December million the $4.1 $4.9 ended of in of acquisition year benefit result prior the a tax will to a for the change related in analysis, addition, carryforward This resulting that In 2015. 2014, on 31, periods. Based 31, December positions. future December tax of ended deferred as its year asset to tax the relative deferred change the this revalued of Company impact ended the years analyzed the Company for the 36.2% and 35.4% were rates respectively. tax 2014, 31, effective December The and respectively. 2015 31, 2014, December 2015 31, December in 31, and completed December 2015 was ended which year conversion ended core the year our merit For support the normal benefits. to growth, for expenses continued employee million our of 2015. with support August $972,000 $16.7 to equity associated included additions increased in expenses costs staff million benefits non-interest to $9.2 increasing executive. related fringe the former and was and and a increase agreement increases with This employment compensation agreement 2015. an employment 2015, 31, of an December payout for under the payout expense 2014, a in incentive to vesting related accelerated expense the million Absent $1.3 a was there euea nenlydvlpdidsr tnadast iblt oe ocmlt u urel interest quarterly our complete to model liability asset/ standard industry developed internally an use We At activities. deposit and investing lending, our with connection in risk rate interest evaluate actively We of level appropriate the determine to is process management risk rate interest our of objective general The Analysis. Qualitative result, a As State. York New of that with conform to law tax their changed City York New 2015, April In Taxes. Income noetxepnews$94mlinad$48mlinfrteyaseddDcme 31, December ended years the for million $74.8 and million $99.4 was expense tax Income ebleeoesgiiatfr fmre iki neetrt ik neetrt risk rate Interest risk. rate interest is risk market of form significant one believe We 69

FORM 10-K Percent (Decrease) Amount Estimated Increase Net Interest Income (3) Income Interest Estimated Net Percent (Dollars in thousands) (Decrease) Amount Estimated Increase EVE (1) (2) 70 EVE Estimated The table below sets forth, as of December 31, 2016, the estimated changes in our The table set forth above indicates that at December 31, 2016, in the event of a 200 basis points increase in As mentioned above, we use an internally developed asset liability model to compute our quarterly interest Quantitative Analysis. 0bp $4,791,637 — — $656,677 — — + 200bp-100bp(1) Assumes an(2) instantaneous and parallel EVE shift is in(3) the interest net rates present at Assumes value all a of maturities. gradual expected change cash in flows interest from rates assets, over liabilities a and one off-balance year sheet period contracts. atinterest all maturities. rates, we$40.9 million would decrease, be orrates, we 6.2% expected would in be to net expectedor to interest 0.3% experience experience in income. a a net In $48.4 interestin million the $550.7 income. decrease, interest event This or million $4,240,906 rates, data of 1.0% in doesresults such a decrease, EVE of not as 100 the and reflect (550,731) or EVE a changing basis any and $1.8 points future the 11.5% net million actions interest (11.5)% decrease mix increase, income we in in in calculations. may $615,745 $4,743,206 interest EVE take or in growth and response of to a changes our (48,431) (40,933)rate assets risk and liabilities, reports. (6.2)% measurements. (1.0)% which Certain Modeling could shortcomings changes $658,461 change in arenot the EVE inherent reflect and the in net manner interest in anynet which income interest methodology actual require income 1,784 yields used certain table andrate presented assumptions in costs above sensitive that respond the assumes assets may to no above changes or andmeasured growth in 0.3% may interest liabilities and, and market existing rate accordingly, interest that at rates. generally the risk rates. The the the data EVE The composition beginning does and of table not of our reflect also aAccordingly, interest- any assumes period although actions a remains the we particular constant EVE mayrate over change and take changes the in net in at interest period interest response income a being rates toforecast table particular is of changes the provide in point reflected effects an interest uniformly in of indication changes across time, of in the such market our yield measurement interest sensitivity rates curve. is to on not interest our EVE intended and to net interest and income. does not provide a precise Change in Interest Rates (basis points) We use a combinationsensitivity of analysis analyses to determines monitor thehorizons. our relative exposure This balance to asset between changesforecasted in the prepayment and interest repricing rates rates. liability of asmismatches Our assets in well net analysis the and interest as timing includes income liabilities contractualof of over interest and expected asset rate various and forecasted risk cash liability because liabilityto cash the flows cash market assumptions flows used interest flows. but from in does rate This thepresent not changes. loans analysis analysis necessarily The value may identifies provide and not economic (“NPV”) reflect an valuechanged the securities, accurate of of actual interest indicator equity response assets using rate of (“EVE”) and cash scenarios. analysissecurities flows prepayment estimates In liabilities rates, the calculating and reinvestment change changes rates off-balance in and in the deposit sheet EVE, decay net rates. contracts for the over various a scenarios range we of forecast immediately loan and EVE and our net interestinterest income rates that are would result calculatedgradual from as the change an designated over changes immediateprospective in a and interest effects permanent one rates. of change Such year hypothetical changeslevels for period to of interest the market rate for purposes interest changes rates, the ofactual loan are computing purposes prepayments results. based EVE and of The on deposit and decay, following computingincome numerous a and for table assumptions net should an reflects not including interest interest be rate management’s relative relied decrease income. expectations upon of as Computations 100 of indicative basis of the of points changes and increase in of EVE 200 basis and points. net interest

FORM 10-K HBavne.Dpnigo aktcniin,w a erqie opyhge ae nsc eoisor 2016. deposits 31, such December and on before deposit or rates of on higher due certificates deposit pay us, other of to with to certificates required remain limited the be on not not pay undisbursed may do but currently deposits we including we and these than funds, conditions, borrowings credit, If of market other deposits. sources on of total other Depending lines of seek advances. 12.2% to year overdraft FHLB or one required and within billion, be due $1.87 will equity deposit totaled we of purchase home 2016 Certificates to 31, billion. unused $1.07 commitments December approximately and of million, totaling $113.9 loans, million constructions approximately and $151.6 of business of loans residential loans originate residential to common commitments our had of we shares repurchase million to $13.5 respectively, and 2014, million and we $382.9 plans. 2015 acquisition, million, repurchase 2016, Financial stock $363.4 31, Gateway our utilized under December the During we stock of in ended respectively. addition, acquired years million, In loans ended securities the $957.9 billion. year the during purchased and $1.52 the loans excluding billion of we During 2014, $1.04 excluding securities million. 31, of 2014, 2015 purchased $233.9 securities December and 31, of and purchased ended billion loans December we year purchased 2016 $4.92 ended 2015 the we and billion, year 31, Financial, 2016 $5.08 the Gateway 31, December of of During December acquisition loans ended respectively. the originated million, year in we $198.6 acquired the 2014, and and During million 2015 $141.6 respectively. 2016, billion, 31, December $3.76 ended maturing, used years down the Company pay deposit to outpacing The originations 2014 2014. loan May new 31, in to offering December due capital net largely ended was step acquisition, year borrowings second in Financial growth. the its increases Gateway from The for proceeds borrowings. the million short-term the in $606.4 of assumed half local by funds approximately our decreased borrowed and funds us Excluding borrowed by respectively. offered million, products $497.0 and rates interest of the level overall rates, the interest by market Gateway affected factors. the are other in billion and from flows and changes $1.22 deposits competitors, Deposit million the increased billion. of $533.1 excluding $1.20 deposits direction 2014, million, by 2015 31, increased and $227.1 and December deposits totaled ended 2016 total operating year 2014 31, acquisition, the by December Financial and For provided ended respectively. 2015 cash billion, year 2016, $1.89 Net the 31, and borrowings. For December respectively. and ended million, deposits years $277.4 activities, the operating for by activities provided cash used include and In funds billion gain. principal $2.15 a borrowings. of in in term proceeds short resulting Included net maturing, million raised down respectively. $2.6 Company pay years million, of to the proceeds payoffs 2014, during $70.3 the in security of securities and conversion were half step approximately of million 2015 second were 31, sales $72.2 the December 2014 were with of ended and connection There 2014 year 2015 the respectively. and 2016, for billion, million, 31, 2016 repayments $2.14 December $357.6 and 31, ended billion and December $2.95 years million billion, ended the $3.30 $553.2 for were million, 2014 securities and $671.3 on 2015 2016, repayments 31, Principal December respectively. ended years the contingencies. for unanticipated loans ensure as to well as strategies customers Asset and our Our targets of needs liquidity competition. the our mortgage and meeting monitoring and conditions for and exists flows economic liquidity establishing deposit rates, sufficient for funds, that interest responsible of general is source maturities Committee by predictable While Liability borrowings. are influenced of securities greatly forms and various are and loans prepayments flows of cash amortization security and scheduled loan and inflows, deposit of consists funds Resources Capital and Liquidity tDcme 1 06 ehdcmimnst rgnt omrillaso 412mlin Additionally, million. $451.2 of loans commercial originate to commitments had we 2016, 31, December At During securities. of purchase the and loans of purchase and origination the for are funds of use and primary Our billion $1.28 increased funds borrowed net 2015 and 2016 31, December ended year the For of sources other our securities, and loans on payments interest and principal by provided cash to addition In on repayments Principal securities. and loans on flows cash by provided cash is funds of source primary A of sources primary Our obligations. financial future and current meet economically to ability the is Liquidity 71

FORM 10-K Total More than Five Years Three to Five Years (In thousands) Payments Due by Period One to Three Years 72 Less than One Year As a financial services provider, we routinely are a party to various In the ordinary course of our operations, we enter into certain contractual The Company has entered into derivative financial instruments to manage exposures that arise from Total $1,006,633 $1,548,660 $1,428,484 $800,502 $4,784,279 Contractual Obligations. The following table summarizes our significant fixed and determinable contractual obligations and other Liquidity management is both a short and long-term function of business management. Our most liquid Investors Bank is subject to various regulatory capital requirements, including a risk-based capital measure. Off-Balance Sheet Arrangements. business activities that result inwhich the are receipt or determined paymentdifferences by of in future interest the known amount, rates. and timing,or uncertain and The expected duration cash Company’s of cash amounts, the the payments derivative Company’s2016, value principally known financial of such related or instruments expected to derivatives cash the arewholesale receipts were Company’s and used funding its borrowings. used to known transactions. For to$12.6 manage the The million. year hedge fair ended the December value variability 31, of in the cash derivative flows as associated of with December certain 31, short 2016 term was an asset of Contractual Obligations Other borrowed fundsRepurchase agreementsOperating leases $ 960,000 $1,350,567 23,629 $1,375,000 $705,853 131,202 $4,391,420 23,004 — 66,891 53,484 — 94,649 154,831 238,028 financial instruments withcredit. off-balance-sheet While risks, these such contractualcommitments as to obligations commitments extend represent credit to our maycredit extend expire policies future and credit without cash approval being and processes requirements, drawn that unused upon. a we Such lines use significant commitments for of portion are loans that of subject we to our originate. the same obligations. Such obligations include operating leases for premises and equipment. funding needs by payment daterecipient at December and 31, 2016.adjustments. do The payment not amounts represent include those amounts any due to the unamortized premiums or discounts or other similar carrying amount assets are cash and cashinvesting equivalents. The activities levels of these$164.2 during assets million. depend any Securities, upon our which2016. given operating, provide financing, If additional lending period. we and sources requireFHLB At of funds and liquidity, December beyond other totaled financial our $3.42 31,borrowing institutions, ability billion which capacity to 2016, at provide generate at December an cash$4.41 them 31, the additional billion internally, source FHLB and and borrowing of outstanding was agreements funds. cash lettersovernight At $10.25 exist of borrowing December equivalents credit lines with billion, 31, with of the of other 2016, $2.92 totaled December institutions billion. our 31, which totaling 2016. In the $325.0 addition, million, the Company of Bank which had had no uncommitted outstanding balance unsecured was borrowings outstanding of at The risk-based capitalweighted guidelines assets include by bothDecember assigning 31, a 2016, balance definition Investors“well sheet of Bank capitalized” exceeded assets capital under all and andRegulation regulatory regulatory — a off-balance capital guidelines. Capital requirements. framework Requirements.” sheet See Investors for items “Item Bank calculating is 1. to considered risk- Supervision broad and risk RegulationOff-Balance categories. — Sheet At Arrangements Federal and Aggregate Banking Contractual Obligations

FORM 10-K eteeto nuac lis rcesfo h eteeto oprt-we ieisrnepolicies insurance life corporate-owned of the from settlement proceeds the combination, from business rate interest a proceeds effective after the claims, to made relation insurance payments in insignificant consideration of instruments are debt contingent that settlement zero-coupon rates borrowing, of interest settlement the coupon costs, with of extinguishment instruments or debt prepayment other debt or issues: flow Consolidated ASU cash Company’s Payments” of specific Cash the and provisions Receipts on Cash the have Certain evaluating will standard currently new is Early the Company annual) years. impact or The fiscal (interim potential statements issuance. those the financial for Statements. for which within determine Financial effective for to available periods is period 2016-16 2016-16 annual made interim No. an No. including been of ASU beginning party. assets 2017, not the outside of 15, of have an transfers as to December intra-entity permitted sale for is after until adoption exception beginning recognition the such years past. eliminating defer by fiscal the to GAAP inventory current in than amends other taxes and transfer withholding asset is entity Inventory.” employee this Than such Flows; Other Assets Cash presented certain of have of Statement we presentation Consolidated the which required. the is requires periods in on prior also and, for activity manner 2016-09 reclassification prospectively the no financing No. the Accordingly, guidance on from ASU a of classification 2016-09 flows with adjusted. as cash practice flow No. consistent than been ASU cash taxes existing rather of not this its withholding activities, effects apply have operating continue employee tax from to periods to flows income elected prior cash elected The Company therefore, as forfeited. has The classified policy be now activities. Company guidance, accounting are will current financing The flows entity’s under that as cash occur. an awards vest, of allows to they of statement expected 2016-09 number when are No. that the forfeitures in awards ASU estimating expense of for tax forfeitures, number tax income the to account to income estimate benefit Relative as or to a recorded 2016. continue in be either resulted of shortfalls to This and quarters equity. election benefits than the the rather additional tax The adoption, of statement, excess and income 2016, Upon that earnings each the 2016. requires 31, retained in 2016-09 of of expense December No. or balances quarter On ASU benefit opening an first The occur. the the capital. they on to in for adjustment as paid made effective cumulative-effect forfeitures and tax cumulatively, an payments statement, for recorded for 2016-09 flows cash account Company cash other No. shares its to ASU all from employee’s on election activity adopted an apart that financing policy Company of a activity as clarifies accounting more financing presented an be repurchase accounting, a should provides to shares as liability flows withheld entities classified cash for triggering allows addition, behalf separately employee’s In also without be settled. tax standard longer are purposes and The or no benefits withholding flows. vest will tax awards cash excess benefits the tax when requires tax income statement guidance excess income new to the The in related employees. recorded to be to payments deficiencies share-based of Accounting”, aspects Payment certain Share-Based Employee to Improvements of effects the than performance on Pronouncements Accounting impact Recent greater a the have in rates in reflected monetary is interest the primarily inflation market are of requires liabilities in impact and changes The assets generally inflation. result, inflation. our companies, to a GAAP industrial due As Unlike time changes nature. (GAAP). operations. over considering our without money of dollars principles of cost historical power increased of accounting purchasing terms in relative results the accepted operating in and generally position financial of U.S. measurement with accordance Prices Changing and Inflation of Impact nAgs 06 h ABise S 2016-15, ASU issued FASB the 2016, August In 2016-16, ASU issued FASB the 2016, October In 2016-09, ASU issued FASB the 2016, March In in prepared been have Inc. Bancorp, Investors of notes related and statements financial consolidated The hsAUadesstercgiino urn n eerdtxsfra intra- an for taxes deferred and current of recognition the addresses ASU This e tnadwihadessdvriyi rcierltdt eight to related practice in diversity addresses which standard new a , 73 Saeeto ahFos(oi 3) lsiiainof Classification 230): (Topic Flows Cash of “Statement Icm ae Tpc70:ItaEtt rnfr of Transfers Intra-Entity 740): (Topic Taxes “Income Cmesto tc opnain(oi 718): (Topic Compensation Stock — “Compensation e tnadta hne h conigfor accounting the changes that standard new a

FORM 10-K , which requires all lessees to .” This amendment supersedes the “Leases (Topic 842)” “Financial Instruments- Overall (Subtopic 825-10): 74 “Measurement of Credit Losses on Financial Instruments.” In June 2016, the FASB issued ASU 2016-13, In February 2016, the FASB issued ASU 2016-02, In January 2016, the FASB issued ASU 2016-01, (including bank-owned life insuranceinterests policies), in securitization distributions transactions; received andprinciple. separately from ASU identifiable equity cash No. method flows 2016-15 andperiods investees, is application beneficial within of effective the those for predominance fiscalmethod fiscal to years. years each beginning Entities period after willissues, presented. December the apply If 15, amendments it the 2017, is for standard’sCompany including impracticable those is provisions interim to issues currently using apply would evaluating the astandard be the amendments will retrospective applied provisions have retrospectively prospectively of on transition for the ASU as some Company’s No. of Consolidated of 2016-15 Financial the the to Statements. earliest determine date the practicable. potential The impact the new This ASU significantly changes howinstruments entities will that measure credit aren’tresponding losses for measured to most financial criticism at assetstoday’s and that fair certain “incurred other today’s value loss” guidanceexpected approach through credit delays with loss net recognition (“CECL”) anamortized income. model, of “expected will cost, In credit loss” apply and to: model. issuing losses.leases, (2) (1) held-to-maturity The The financial certain the securities, assets new off-balance standard loan standard, subject commitments, model,to sheet will to and available-for-sale the referred credit credit financial (“AFS”) replace losses guarantees. debt FASB to exposures. The and securities.credit This as CECL For measured is losses model AFS at includes, the debt does in securities but not current a with apply rather is manner unrealized than similar losses, not reductions entities to in limited will what the measure estimated to, they amortized credit loans, cost do losses of today, immediately the exceptASU securities. in also that As earnings simplifies the a the rather losses result, accountingalso than will entities model expands as be will for the recognize interest recognized purchased disclosure improvements as income credit-impairedthe requirements to allowances debt over allowance regarding securities time, an for and as entity’s loan loans. theyeach assumptions, ASU and do 2016-13 models, lease class and today. losses. methods The In ofNo. for addition, estimating entities 2016-13 financial will is need assetadoption effective to is disclose for by permitted the interim for amortized creditapply interim and cost the and quality balance annual standard’s annual for provisions reporting reporting indicator,first as periods periods a disaggregated reporting beginning cumulative-effect beginning after period adjustment by after Decemberadoption to in 15, is December retained the 2018. which permitted, earnings 15, Entities the as year the 2019; will of of Company guidance the the does of early amended beginning not is of origination. guidance expect effectivethe the including to change ASU the elect (i.e., is potential that modified indeterminable option. impact atthe The on retrospective adoption this Company its date, time approach). has Consolidated as as begun well While Financial it as its Statements. will early economic evaluation The be conditions extent dependent and forecasts of upon at portfolio that composition time. and credit quality at recognize a lease liabilitypayments, and at a right-of-use theguidance. asset, lease The measured at commencement guidancereporting the date. is periods present within effective Lessor value that ofmust reporting for accounting the period, be fiscal remains with future applied early minimum years largelypresented adoption for lease permitted. beginning in leases unchanged A the after existing modified financial underdetermining retrospective at, statements. December whether the approach The or other 15, Company new entered contracts continues 2018, existreached into to regarding that including evaluate after, the are potential the interim deemed the impact impact to on beginning of be adoption in the of on scope. the guidance, the Company’s As including Consolidated earliest such, Financial no comparative Statements. conclusions period haveRecognition yet and been Measurement ofguidance Financial to Assets classify andequity equity Financial securities securities Liabilities to be withsimplifies measured readily at the determinable fair value fair impairmentamendment with values requires changes assessment public in into of the business differentmeasured fair entities equity categories, value at that recognized requires investments are amortized through requiredamendment cost net without requires to income, on an disclose readily and entity the the to determinable present fair balance separately value fair sheet in of other to values. comprehensive financial income measure instruments The the that portion of fair the total value change using the exit price notion. The

FORM 10-K sefciefrfsa er,aditrmproswti hs iclyas einn fe eebr1,2015. 15, December after statements. beginning as financial years, consolidated sheet Company’s fiscal asset. the balance those to ASU an the impact the within as material in on periods a guidance than reported have interim the debt not entities, rather and Conclusions, be did business years, guidance for liability public should This For fiscal Basis debt received recorded. ASU’s for is is related the amount effective funding liability the to is debt associated According from that until expense. the deduction presents charges interest before deferred entity direct as an incurred a reported ASU, costs as is the issuance Under costs sheet statements. the balance financial of in the Amortization costs in issuance costs debt of such presentation the changes 2015. ASU 15, of December after amount statements. beginning financial the years, consolidated Company’s disclose fiscal ASU the the those to must in impact within guidance material acquirers periods the a entities, have However, interim if not business periods and period. did public previous years, guidance For in that This fiscal date. recognized acquisition in been for the have effective reported of would is as that be are recognized amounts that were to to adjustments adjustments relating Instead, are the income period. period period measurement current the to later in not adjustments known a are become circumstances later in and and facts made date, final acquisition when the statements, on financial known acquisition-date in included amounts provisional for not guidance liabilities, will of and revenues Company’s assets scope the financial The of with majority income. associated the non-interest revenues Accordingly, other derivatives. affected. and be as and of liabilities securities well comprised and leases, is as loans, revenue income assets including Company’s interest earning The net standard. interest original excludes the on explicitly as income date effective interest same net the (Topic have and Customers 2014-09 Meeting” with ASU EITF 2016 Contracts 3, from March Expedients” the “Revenue Practical at Announcements 2016-12, Staff ASU to Pursuant and 2014-16 and 2014-09 Updates Derivatives Standards FASB and the 605) Subsequently, (Topic with permitted. Contracts is issued from Considerations” “Revenue statements adoption to 2016-08, Agent (Topic financial early ASU customers versus for 2014-09: and Principal with entities ASU 606): 2017, business to contracts (Topic 15, related are public into standards contracts for December following those effective enters after the unless is issued assets either beginning ASU nonfinancial years that The of standard fiscal standards. transfer entity revenue the other for common any for of a contracts scope affects into develop the enters update to in or and This services revenue or IFRS. recognizing goods and transfer for GAAP principles the U.S. clarify as for to 2018, is of amendment quarter this first liquidity. the and position, during financial standard operations, of accounting results the its the of on as adopt impact the exist the to that of without evaluating investments intends as currently securities equity is equity Company adjustment and to to effect The required, prospectively related applied amendment cumulative adoption. the be a of of should of exception date which the means values, with fair by adoption, within determinable amendment of periods readily year the interim a assets. fiscal including tax on apply the 2017, deferred allowance reduces should of 15, other valuation beginning December Entities amendment entity’s after a the years. The beginning for with years fiscal statements. need combination fiscal in those the financial for securities evaluate effective the sale is should for to amendment entity available This requires notes an to financial amendment related that accompanying of asset The has clarifying the form tax option. by entity and deferred in practice the value category or current when fair measurement sheet in risk the by diversity balance credit with liabilities instrument-specific the financial accordance the and in on in assets value asset change financial fair of a at presentation from liability separate resulting the liability measure a to of elected value fair the in esrmn-eidAdjustments.” Measurement-Period nArl21,teFS sudAU2015-03, ASU issued FASB the 2015, April In Accounting the Simplifying Combinations- “Business 2015-16, ASU issued FASB the 2015, September In 2014-09, ASU issued FASB the 2014, May In 0) dniyn efrac biain n Licensing” and Obligations Performance Identifying 606): hs mnmnsaeitne oipoeadcaiyteipeetto udneof guidance implementation the clarify and improve to intended are amendments These . n egn Tpc85:Rsiso fSCGiac eas fAccounting of Because Guidance SEC of Rescission 815): (Topic Hedging and ne h e ue,aqiesn ogrhv ortopcieyadjust retrospectively to have longer no acquirers rules, new the Under Rvnefo otat ihCustomers.” with Contracts from “Revenue SmlfigtePeetto fDb suneCosts.” Issuance Debt of Presentation the “Simplifying S 061,“eeu rmCnrcswt Customers with Contracts from “Revenue 2016-10, ASU ; 75 S 061,“eeu Recognition “Revenue 2016-11, ASU ; 0) arwSoeIpoeet and Improvements Narrow-Scope 606): h betv of objective The Customers The ;

FORM 10-K The ASU gives an employer whose fiscal year-end “Practical Expedient for the Measurement Date of an 76 CONTROLS AND PROCEDURES FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA CHANGES IN AND DISAGREEMENTS WITHFINANCIAL ACCOUNTANTS DISCLOSURE ON ACCOUNTING AND QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK (a) Evaluation of disclosure controls and procedures. With the participation of management, the Principal Executive Officer and Principal Financial Officer have (b) Changes in internal controls. There were no changes in our internal control over financial reporting that occurred during the quarter ended (c) Management’s report on internal control over financial reporting. The management of Investors Bancorp, Inc. is responsible for establishing and maintainingOur internal adequate control over financial reporting includes policies and procedures that pertain to the maintenance The Financial Statements are included in Part IV, Item 15 of this Form 10-K. Not applicable. For information regarding market risk see “Item 7. - Management’s Discussion and Analysis of Financial In April 2015, the FASB issued ASU 2015-04, evaluated the effectiveness ofdefined the design in and Rule operation 13a-15(e)evaluation, of and the the Company’s 15d-15(e) Principal disclosure under ExecutiveCompany’s controls the disclosure and Officer controls Exchange procedures and and (as Act) procedures Principal are as Financial effective. of Officer December concluded 31, that, 2016. as Based of upon that that date, the December 31, 2016control that over financial have reporting. materially affected, or are reasonably likely to materially affect, our internal internal control overprovide financial reasonable reporting. assurance Investors toand Bancorp’s fair the internal presentation Company’s of control published management system financial and statements. is board a of process directors designed regarding to theof preparation records that, inreasonable reasonable assurances detail, that accurately transactions and areaccordance fairly recorded with reflect as transactions necessary U.S. and to generally permit dispositions preparation of accepted of assets; accounting financial provide statements principles, in and that receipts and expenditures are being ITEM 9. ITEM 9A. Condition and Results of Operations.” ITEM 8. Employer’s Defined Benefit Obligationdoes and not Plan coincide Assets.” withretirement obligations a and calendar related month-endalso plan assets the provides as ability, of guidance asremeasurement the that month-end a on that occur practical is accounting during expedient,year-end. closest the An to for to period entity its measure between contributions should fiscal definedthe a reflect year-end. to retirement benefit month-end The the benefit ASU measurement effects the obligations of datefinancial those plan and and statements contributions related issued the and or for plan employer’sfiscal significant fiscal assets. fiscal significant years. years events The This beginning in events guidance ASU after the did is December that not measurement have effective 15, of a require 2015, for material and public impact a interim to business periods the entitiesITEM within Company’s 7A. consolidated for those financial statements.

FORM 10-K eei yrfrnei h opn’ eiiiePoySaeett efldwt epc oteAna Meeting Annual the to incorporated respect is with filed plans 2017. be compensation 23, to May Meeting equity Statement on Annual regarding Proxy held the definitive be Information to to Company’s 2017. respect Stockholders the 23, with of in May filed reference be on by to in held Statement here be Proxy to definitive Stockholders Company’s the of in reference by herein 23, May 12. on ITEM held be to Stockholders of Meeting Annual the to respect with filed 2017. be to Statement Proxy definitive the to respect with 11. filed ITEM be to 2017. Statement 23, May Proxy on definitive held be Company’s to the Stockholders of in Meeting Annual reference by herein incorporated 10. ITEM 9B. ITEM 10-K. financial Form on over Report Annual control this to internal 31.2 Company’s Exhibit the of 69. page effectiveness on the appears report on This 2016. report 31, December audit of as an reporting issued has statements in the by Commission forth criteria. set Treadway those on criteria based the the effective is used reporting we of financial over assessment, control this Organizations making (2013) Sponsoring In Framework 2016. of 31, December Committee of as reporting financial compliance of degree the that or to statement conditions, subject in financial deteriorate. are changes may to periods of procedures future because respect or to inadequate policies with effectiveness the become assurance with of may evaluation controls reasonable any that only risk of provide the projections Also, can presentation. effective and be preparation to determined systems statements. of financial disposition our or on effect use material provide acquisition, a and unauthorized have Bancorp; of could Investors that detection of assets timely directors Bancorp’s the or Investors and prevention management regarding of assurance authorizations reasonable with accordance in only made nomto eadn euiyonrhpo eti eeiilonr n aaeeti incorporated is management and owners beneficial certain of ownership security regarding Information Company’s the in reference by herein incorporated is compensation executive regarding is Information Company the of governance corporate and officers executive directors, regarding Information and applicable. Not 31.1 Exhibit as SEC the with filed been have Certifications 302 Section Act Sarbanes-Oxley The financial consolidated the audited that firm accounting public registered independent Bancorp’s Investors over control internal Company’s the of effectiveness the assessed management Bancorp’s Investors those even Therefore, limitations. inherent have designed, well how matter no systems, control internal All N EAE TCHLE MATTERS MANAGEMENT STOCKHOLDER AND RELATED OWNERS AND BENEFICIAL CERTAIN OF OWNERSHIP SECURITY COMPENSATION EXECUTIVE GOVERNANCE CORPORATE AND OFFICERS EXECUTIVE DIRECTORS, TE INFORMATION OTHER ae norassmn ebleeta,a fDcme 1 06 h opn’ internal Company’s the 2016, 31, December of as that, believe we assessment our on Based . atIII Part 77 nenlControl-Integrated Internal

FORM 10-K 78 Part IV EXHIBITS AND FINANCIAL STATEMENT SCHEDULES PRINCIPAL ACCOUNTANT FEES AND SERVICES CERTAIN RELATIONSHIPS, RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE (a) (1) Financial Statements Information regarding principal accounting fees and services is incorporated herein by reference in Investors Information regarding certain relationships and related transactions, and director independence is Bancorp’s definitive Proxy Statementon to May be 23, filed 2017. with respect to the Annual Meeting of Stockholders to be held ITEM 15. ITEM 13. incorporated herein by referenceAnnual Meeting in of Stockholders the to Company’s be held definitive on Proxy May 23, Statement 2017. toITEM be 14. filed with respect to the

FORM 10-K raiain fteTeda omsin(OO,adorrpr ae ac ,21 xrse an 2017 1, March expressed Jersey 2017 New Hills, 1, Short March dated report reporting. LLP financial on our KPMG over /s/ based control and internal 2016, Company’s (COSO), the 31, of Board December Commission effectiveness the Oversight of on Treadway Accounting opinion as unqualified Company the reporting Public financial of the over Organizations of control standards in internal the established Company’s criteria with 2016, the accordance 31, States), in December ended (United audited, period have three-year also the results in We the years and the principles. 2015, of accounting and accepted each 2016 the generally for 31, respects, U.S. flows December material with cash of conformity all their as in in and subsidiaries fairly, operations and present Inc. their above Bancorp, of to overall Investors referred the of statements evaluating position financial financial opinion. consolidated as our the for well opinion, basis our as reasonable In a management, provide audits by the our assessing made basis, that includes believe test also estimates We a audit presentation. significant An on statement statements. examining, and financial financial includes about used the assurance audit in principles reasonable An disclosures obtain misstatement. accounting Board and to material Oversight amounts audit of the Accounting the free supporting Company perform are evidence Public and statements plan the Our financial we of the that management. standards whether require the standards Company’s with Those accordance States). the in (United audits. audits our of on our 31, based responsibility conducted December statements We financial ended the consolidated period these three-year are on the opinion in statements an express years to financial the comprehensive is of income, responsibility consolidated each of (the statements for These subsidiaries consolidated flows related and cash 2016. the Inc. and and Bancorp, equity, 2015, Investors and stockholders’ of 2016 income, 31, sheets December balance of consolidated as accompanying Company) the audited have We Inc.: Bancorp, Stockholders Investors and Directors of Board The nenlCnrl—Itgae rmwr (2013) Framework Integrated — Control Internal eoto needn eitrdPbi conigFirm Accounting Public Registered Independent of Report 79 sudb h omte fSponsoring of Committee the by issued

FORM 10-K issued by Internal Control — Integrated 80 Internal Control — Integrated Framework (2013) Report of Independent Registered Public Accounting Firm issued by the Committee of Sponsoring Organizations of the Treadway Commission. The Board of Directors andInvestors Stockholders Bancorp, Inc.: We have auditedDecember 31, Investors 2016, based Bancorp, on criteria Inc.’s established (the in Company) internal control over financial reporting as of the Committeemanagement of is Sponsoring responsibleassessment for of Organizations the maintainingManagement of Report effectiveness effective on the Internal of internal Controlthe Over internal Company’s Treadway control Financial internal control Reporting. control over Our over Commission over responsibility financial is reporting financial financial based to (COSO). on express reporting reporting, our anWe The audit. opinion and included on conducted our in Company’s for audit(United the its in States). accordance accompanying Those standards with requirewhether the that standards effective we of plan internal the andincluded control perform Public obtaining the over Company an audit understanding Accounting financial to ofweakness Oversight obtain reporting internal exists, Board reasonable control was assurance and over about maintained financial testingthe reporting, and in assessed assessing evaluating all the risk. the risk Our materialcircumstances. that design audit We a respects. and believe also material operating Our that included our effectiveness audit performing audit of provides such a internal other reasonable control basis procedures basedA for as our on company’s we opinion. considered internalregarding necessary control the in over reliability the of financial financialaccordance reporting reporting with and generally is the accepted preparation aincludes accounting of process principles. those financial A statements designed policies company’s for and to internalaccurately external procedures and control purposes provide fairly in that over reasonable reflect financial (1) the reporting assurance assurance pertain transactions that and to transactions dispositions the are of maintenance thewith recorded assets generally of as of accepted necessary records the accounting to that, company; principles,only permit (2) in and in preparation provide that reasonable accordance reasonable of receipts with detail, financial and authorizationsassurance statements expenditures of in of management regarding the accordance and company directors prevention arecompany’s of being assets or the made that company; could timely have and a (3) detection material provide effect reasonable of on theBecause financial unauthorized statements. acquisition, of use,misstatements. its Also, or inherent projections disposition ofcontrols limitations, any of may evaluation internal become of the inadequate effectivenesspolicies control or to because procedures future over of may periods deteriorate. changes financial are in subject conditions, reporting to or theIn may that risk our the that not degree opinion,financial of prevent Investors reporting compliance or Bancorp, with asFramework the Inc. of detect (2013) December maintained, 31, in 2016, all based material onWe respects, criteria also effective established have internal in audited,(United control States), in the accordance over consolidated with2016 balance and the sheets 2015, standards of and Investors of theand Bancorp, related the cash consolidated Inc. Public flows statements and for Company ofMarch subsidiaries income, 1, each Accounting as 2017 comprehensive of of Oversight expressed income, an December the Board stockholders’ unqualified 31, years equity, opinion on in those the consolidated three-year/s/ financial KPMG statements. period LLP ended December 31, 2016, andShort our Hills, report New Jersey dated March 1, 2017

FORM 10-K Liabilities: e eerdtxast2227237,367 159,152 6,283 105,311 222,277 161,940 101,839 7,431 4,492 58,563 172,519 38,298 65,969 178,437 177,417 16,661,133 18,569,855 237,878 equity: Stockholders’ contingencies and Commitments 148,904 164,178 $ 1,304,697 1,660,433 assets Other assets intangible and Goodwill insurance life owned Bank asset tax deferred Net net equipment, and properties Office owned estate real Other receivable interest Accrued stock Bank Loan Home Federal held-for-sale Loans net receivable, Loans $1,888,686 and $1,782,801 of value fair (estimated net held-to-maturity, value Securities fair estimated at available-for-sale, Securities equivalents cash and Cash tDcme 1 06ad21,rsetvl)175561,844,223 1,755,556 respectively) 2015, and 2016 31, December at te iblte 1,9 141,570 118,495 14,063,656 3,263,090 $15,280,833 4,546,251 108,721 105,851 insurance and liabilities taxes Other for borrowers by payments Advance funds Borrowed Deposits oa tchles qiy313253,311,647 3,123,245 936,040 1,053,750 20,888,684 (27,825) $23,174,675 (24,600) 2,785,503 2,765,732 17,577,037 20,051,430 (90,250) (87,254) 20,888,684 equity stockholders’ and $23,174,675 liabilities Total equity stockholders’ — Total plan ownership loss stock comprehensive employee other the Accumulated by held stock common 31, Unallocated December at shares 24,176,671 and 49,621,464 cost; — at stock, Treasury earnings Retained capital paid-in Additional authorized; shares 1,000,000,000 issued value, none par shares; $0.01 authorized stock, 100,000,000 Common value, par $0.01 stock, Preferred liabilities Total assets Total 06ad21,rsetvl 5794 (295,412) (587,974) 3,591 3,591 respectively 2015, and 2016 respectively 2015, and 2016 and 31, 309,449,388 December 2015; at and outstanding 2016 334,894,181 31, December at issued 359,070,852 IBLTE N TCHLES EQUITY STOCKHOLDERS’ AND LIABILITIES e copnigntst osldtdfnnilstatements. financial consolidated to notes accompanying See NETR ACR,IC N SUBSIDIARIES AND INC. BANCORP, INVESTORS ASSETS osldtdBlneSheets Balance Consolidated 81 I huad xetsaedata) share except thousands (In eebr31, December 2016 4534,664 14,543 eebr31, December 2015

FORM 10-K 2014 2015 For the Years Ended December 31, 2016 (Dollars in thousands, except per share data) 82 Consolidated Statements of Income INVESTORS BANCORP, INC. AND SUBSIDIARIES See accompanying notes to consolidated financial statements. Total non-interest expensesIncome before income tax expenseNet income 299,072 358,564 280,877 328,332 206,472 339,860 $ 192,125 181,505 131,721 Total non-interest income 37,201 40,125 41,861 Total interest expenseNet interest incomeNet interest income after provision for loan losses 620,435 569,084 153,336 504,471 640,185 136,639 595,084 118,891 541,971 Total interest and dividend income 793,521 731,723 660,862 EquityGovernment-sponsored enterprise obligationsMortgage-backed securitiesMunicipal bonds and other debt 36 45 60,211 7,713 55,096 46 5,929 44,183 198 5,667 123 115 BasicDiluted 297,580,834 300,954,885 329,763,527 332,933,448 344,389,259 347,731,571 Compensation and fringe benefitsAdvertising and promotional expenseOffice occupancy and equipment expenseFederal deposit insurance premiumsGeneral and administrativeProfessional feesData processing and communicationContribution to charitable foundationOther operating expenses 56,220 206,698 8,644 186,320 12,183 50,865 10,988 172,068 21,043 49,668 9,050 12,238 3,131 — 22,366 14,390 4,372 20,104 30,541 25,333 — 4,238 16,104 28,267 20,000 14,672 27,253 Fees and service chargesIncome on bank owned lifeGain insurance on loans, netGain on securities transactions, netGain on sale of otherOther real income estate owned, net 4,423 17,148 3,100 96 3,948 17,119 1,036 1,631 4,652 4,787 19,399 1,546 809 7,786 7,647 5,257 8,605 10,198 DepositsBorrowed Funds 71,279 82,057 65,225 71,414 59,685 59,206 Loans receivable and loans held-for-saleSecurities: Interest-bearing depositsFederal Home Loan Bank stock $ 715,901 663,424 603,438 9,120 342 6,881 225 6,861 552 Basic earnings per shareDiluted earnings per shareWeighted average shares outstanding $ $ 0.65 0.64 0.55 0.55 0.38 0.38 Income tax expense 106,947 99,372 74,751 Non-interest expense Provision for loan lossesNon-interest income 19,750 26,000 37,500 Interest expense: Interest and dividend income:

FORM 10-K e noe$9,2 8,0 131,721 181,505 $192,125 tax: of net (loss), income comprehensive Other income Net e an ndrvtvsaiigdrn h eid744—— — 7,424 794 (5,042) 1,726 1,066 (1,455) 5,952 1,448 880 7,471 (4,933) (138) (12,284) 1,092 (1,547) (1,358) period the during arising derivatives on gains securities Net debt income on net accretion in impairment included Other-than-temporary maturity gains to security held for to adjustment reclassified Reclassification securities on loss of available-for-sale Accretion securities on gain obligations (loss) retirement Unrealized of status funded in Change oa opeesv noe$9,5 7,8 135,013 176,084 $195,350 3,292 (5,421) 3,225 income comprehensive Total (loss) income comprehensive other Total e copnigntst osldtdfnnilstatements. financial consolidated to notes accompanying See NETR ACR,IC N SUBSIDIARIES AND INC. BANCORP, INVESTORS osldtdSaeet fCmrhnieIncome Comprehensive of Statements Consolidated 83 o h er ne eebr31, December Ended Years the For 2016 I thousands) (In 2015 2014

FORM 10-K Total equity stockholders’ loss other Accumulated comprehensive Unallocated Held by ESOP Common Stock stock Treasury (In thousands except share data) earnings Retained 84 capital paid-in Additional — (8,051) 8,051 — — — — stock Common Year ended December 31, 2016, 2015 and 2014 Consolidated Statements of Stockholders’ Equity INVESTORS BANCORP, INC. & SUBSIDIARIES See accompanying notes to consolidated financial statements. (213,963,274 shares) 2,140 2,091,579 — — — — 2,093,719 Conversion of Investors Bancorp, MHC Purchase by ESOP (6,617,421 shares)Treasury stock retired (14,293,439 shares)Contribution of MHC (143) (64,126) 66 66,108 — 64,269 — — — — (66,174) — — — 12,652 — — — — — 12,652 (6,849,832 shares)restricted stockplan (90,000 shares)released — (85,897) — 5,472 80,425 — 9,220 — 1,129 — (181) — — (948) — — — 2,705 — — — — — 9,220 — 2,996 — 5,701 restricted stockreleased — 13,701 — — — 2,294 — — — — 13,701 2,707 — 5,001 (276,890 shares)restricted stockplan (100,205 shares)released — (3,237) — — 21,975 (85) 1,206 3,322 — — (90) (1,116) — — — — — 2,661 — — — — — 21,975 — 2,996 — 5,657 Balance at December 31, 2016 $3,591 2,765,732 1,053,750 (587,974) (87,254) (24,600) 3,123,245 Balance at December 31, 2015Cumulative effect of adopting ASU No. 2016-09 3,591 2,785,503 936,040 (295,412) (90,250) (27,825) 3,311,647 Balance at December 31, 2014Net incomeOther comprehensive loss, net ofPurchase tax of treasury stock (31,576,421Treasury shares) stock allocated to restricted stock plan Compensation — cost for stock options and 3,591Net tax 2,864,406 benefit from stock-based —Option compensation exercise 836,639 —Common (11,131) stock repurchased for restricted — (93,246) stock Cash — dividend paid — ($0.25 (22,404) perESOP common shares (382,922) share) allocated 2,985 or committed 3,577,855 to be — — — — — — — — — — (87,395) 181,505 — (382,922) — — — — (5,421) (9,045) — — — (5,421) — 19,164 2,985 — — — (87,395) 181,505 — 10,119 Balance at December 31, 2013Net incomeOther comprehensive income, net ofCorporate tax Reorganization — $1,519 720,766Equity from Gateway acquisition 734,563Purchase of treasury stock (67,046) — (1,295,193Treasury shares) stock allocated (29,779) to restrictedCompensation stock cost plan for stock options and (25,696) —Net — — tax benefit 1,334,327 from stock-basedOption compensation ExerciseCash dividend — paid ($0.12 — — — per — (390)ESOP common shares share) allocated or committed to be 22,000 258 3,710 — — — — 131,721 (13,523) — 132 — — 3,292 — — — — (42,555) — 3,292 — — — — — — 9 — (13,523) — — 8,764 — — 131,721 — — 22,000 3,710 5,037 (42,555) — — 13,810 Net incomeOther comprehensive income, net ofPurchase tax of treasury stock (31,336,369Treasury shares) stock allocated to restricted stock plan Compensation — cost for stock options and —Option exerciseCommon stock — repurchased for restricted stock —Cash dividend paid ($0.26 perESOP common shares share) allocated — or committed to (363,410) be — — — — — — (82,291) — — — 192,125 — (363,410) 3,225 — (34,325) — — 3,225 — 68,642 — — — (82,291) 192,125 — 34,317

FORM 10-K ahadcs qiaet tedo eid$14181894230,961 148,904 250,689 164,178 230,961 $ 148,904 information: flow cash period Supplemental of end at equivalents period cash of and beginning Cash at equivalents cash and Cash activities: financing from flows Cash activities: investing from flows Cash dutet orcnienticm ontcs rvddb prtn activities: operating by provided cash net to income net reconcile to Adjustments activities: operating from flows Cash e a eei rmsokbsdcmesto ,8 3,710 2,639,628 (19,728) 2,985 1,969,931 (66,174) (82,057) 2,086,084 — 15,274 — (508,150) 506,986 — 1,283,161 acquisitions for issued stock Common (98,205) acquired assets non-cash Net 17,917 assumed liabilities Total 5,455 (10,000) (31,655) 1,979 — assumed: (116,403) 6,405 — Liabilities (25,550) 19,177 acquired assets non-cash Total (587,952) 38,828 (184,492) (21,088) 51,093 (375,605) 7,614 875 (274,583) — — (2,870) (744,380) acquired: assets (2,425) 143,707 Non-cash — 2,425 Acquisitions: 7,104 14,348 157,342 for: (2,528) year the during paid Cash 49,938 57,879 277,388 5,021 215,142 (646) activities: investing Non-cash 533,134 10,398 equivalents 227,136 cash and cash in (decrease) increase activities Net 183,482 financing by provided cash compensation Net stock-based from benefit tax 174,255 Net 300,549 stock treasury of Purchase insurance options and stock taxes of for Exercise borrowers by 252,683 payments paid 368,543 advance Dividends in increase borrowings (decrease) other Net agreements in repurchase (decrease) other increase under Net stock borrowed 302,769 common funds of of purchase Repayments for stock ESOP common to of Loan sale from proceeds Net deposits in increase Net activities investing acquisitions in for used paid cash consideration Net cash of net merger received, for Cash insurance MHC life from owned received bank Cash from proceeds equipment benefit and Death properties stock office Bank of stock Loan Purchases Bank Home Loan Federal Home of Federal Purchases of redemptions maturity from to Proceeds held securities sale of for Purchases maturity available to securities held of maturity securities Purchases to of held sales securities from of Proceeds sale repayments/calls/maturities for principal available from sale securities Proceeds for of available sales securities from of Proceeds estate repayments/calls/maturities real principal foreclosed from of Proceeds investment sale for from held proceeds loans Net investment of for disposition held on loans Gain of sale from receivable Proceeds loans of originations Net receivable loans of Purchases activities operating by provided cash Net adjustments Total e a eei rmsokbsdcmesto 044—— — 10,414 10,000 18,702 — 13,151 14,921 13,930 — 27,632 (1,794) 10,173 16,190 (10,122) 13,943 (4,508) 13,702 liabilities other in compensation increase stock-based (Decrease) from benefit tax Net assets other in Decrease (benefit) expense tax receivable Deferred interest accrued insurance in life Increase owned bank acquisitions on of Income owned purchase estate bargain real on other Gain of net sale loans, on mortgage Gain of sales on sales Gain loan mortgage from sale Proceeds for originated loans net Mortgage equipment transactions, and securities properties on office Gain of amortization and Depreciation net losses loans, loan on for costs Provision and assets fees intangible net of of securities, accretion Amortization on and discounts premiums of of accretion Amortization and premiums of expense Amortization compensation stock-based foundation and charitable ESOP to stock of Contribution income Net odiladohritnil ses e 1,853 50,347 — — — — 6,404 $ 4,448 3,351 liabilities Other Borrowings Deposits net assets assets, Other intangible other and Goodwill sale Loans for available securities Investment taxes Income Interest sale for held loans to loans of foreclosure Transfer through acquired estate Real e copnigntst osldtdfnnilstatements. financial consolidated to notes accompanying See NETR ACR,IC N SUBSIDIARIES AND INC. BANCORP, INVESTORS osldtdSaeet fCs Flows Cash of Statements Consolidated 85 9,2 8,0 131,721 181,505 192,125 $ 22796 25512 (2,936,744) (2,585,122) (2,297,946) (1,650,629) (1,990,008) (1,795,505) o h er ne eebr31, December Ended Years the For ,1,7 ,9,3 1,198,843 1,891,330 1,217,177 3340 3292 (13,523) (382,922) (363,410) (930,256) (582,337) (295,157) (233,856) (198,623) (141,562) 2572 2868 (150,099) (238,608) (245,792) 2016 1,2 81985,796 118,140 88,169 135,930 117,127 152,807 1,7 9,3 186,747 590,636 219,078 8,9)(735 (42,555) (87,395) (82,291) 2,7)(837 41,263 (48,317) (20,276) 4371,1 13,810 10,119 34,317 145,667 351,629 35,011 160(,8)(9,786) (3,180) 11,640 37,500 26,000 19,750 746 326 (7,100) (4,652) (3,296) (2,832) (3,948) (7,406) (1,546) (5,258) (4,423) (1,036) (4,154) (3,100) ,7 ,4 4,425 4,245 3,479 3,806 3,350 2,881 5,564 3,184 263,041 5,185 — 254,672 — — 268,605 — 21,343 — ——— — 195,062 — — — — — — — — — — 32,411 347,955 — 2,149,893 — 11,307 — — — (1,482) — — 9)(,3)(809) (1,631) (96) I thousands) (In 2015 2014

FORM 10-K 86 Notes to Consolidated Financial Statements INVESTORS BANCORP, INC. AND SUBSIDIARIES Basis of Presentation The consolidated financial statements are comprised of the accounts of Investors Bancorp, Inc. and its In January 1997, the Bank completed a Plan of Mutual Holding Company Reorganization, utilizing the On May 7, 2014, Investors Bancorp, MHC, Investors Bancorp, Inc. and the Bank completed the Plan of The preparation of financial statements in conformity with GAAP requires us to make estimates and The following significant accounting and reporting policies of Investors Bancorp, Inc. and subsidiaries (a) wholly owned subsidiaries, including(collectively, the Investors “Company”). Bank All (theconsolidation. significant Certain “Bank”) intercompany reclassifications and have accounts thecurrent been and made Bank’s transactions year in wholly-owned have the classifications. subsidiaries beenrecurring consolidated eliminated financial In adjustments) statements in the to necessaryconsolidated conform opinion with results for of of the operationsother management, data for fair presented all the for presentation periods the theresults years of presented of adjustments operations ended have that December the (consisting may been 31, be 2016, included. consolidated of expected 2015 for The financial and normal subsequent results 2014 years. condition and are of not operations and necessarily and indicative the ofmulti-tier the mutual holding companycorporation structure. (Investors In Bancorp, a Inc.)Jersey-chartered series which mutual of owned holding steps, 100% company of thestock (Investors the Bank of common Bancorp, formed Investors stock MHC) Bancorp, aoffering. of which Inc. Delaware-chartered See the On initially stock Note Bank October owned 2. and 11, all 2005, formed of Investors a the Bancorp, New common Inc. completed an initial publicConversion stock and Reorganization offrom the a Mutual two-tier HoldingCompany raised mutual Company net (the holding proceeds of “Plan”)per company $2.15 in billion share structure by which selling in to the aCharitable the total Bank a of Foundation. second reorganized 219,580,695 fully Concurrent shares stepBancorp public of with common common stock stock stock stock the at offering holding owned $10.00 exchanged completion and by for company 2.55 issued public of shares structure. stockholders of 1,000,000 thewere The Company (stockholders issued shares common stock other in stock. of than A the offering, totalcommon exchange. Investors common of each control. The Bancorp, 137,560,968 stock conversion The shares share MHC) was historical of to was Company accounted Company of financial the common for results and Old stock as of Investors therefore a Investors Investors merged capital upon Bancorp, into raising MHC completion transaction the are of by Company immaterialconversion entities the to and under resulted the are conversion, results in reflected the ofwithholding as the the net of an accelerated assets shares increase vesting for to ofshares. of payment stockholders’ Investors As all of equity. a Bancorp, taxes outstanding result In with MHC ofratio. addition, stock respect the were the awards Financial conversion, to second all as these information step sharestatements awards of information presented of resulted the has Old in in Investors been conversion treasury Bancorp revised this date. and stock to subsidiaries. of Form reflect The See the 1,101,694 Note 10-K 2.55- 2. to- is one derived exchange inassumptions part that from affectliabilities the the at consolidated reported the amounts financial datesreporting of of the periods. assets financial The and statements(“MSR”), estimate liabilities and the the of and reported our disclosure valuation amountsimpairment of allowance of of of revenues contingent for securities, and assets deferred stock loan expenses based and during losses, tax compensation the the and assets, valuation derivative impairment instruments of are mortgage judgments particularly servicing regarding critical rights because goodwill and fair value, 1. Summary of Significant Accounting Policies (collectively, the Company) conformpreparing to and U.S. presenting generally these consolidated accepted financial accounting statements. principles (GAAP), and are used in

FORM 10-K h oa te-hntmoayipimn eae ocei osi eonzdi anns hl h amount the while impairment earnings, other-than-temporary in total of The recognized portion income. The is comprehensive security. other the loss in of the credit recognized basis is compares cost to factors amortized Company related other In the the be to factors. with impairment related loss, other must collected to other-than-temporary be credit that related to total to amount expected occurred the the attributable flows (b) has value cash impairment and of fair loss loss, other-than-temporary value in to credit impairment present of expect to decline not level other-than-temporary related the does amount the an of Company the assessing the amount (a) basis, but categories: full security, cost two the a into amortized to to to other-than-temporary separated applies prior an entire equal circumstances security security, income the these the a of of sell to recover neither to statement applies If required the circumstances cost. be these amortized in will of below recognized Company one the is the If that sell loss basis. not to cost impairment than intends amortized likely it its whether more of (a) is consider recovery it 320, first whether Topic to (b) has and (“ASC”) Company with security, the Codification accordance Securities” impairment, In Standard Equity other-than-temporary factors. for Accounting other and could assessed and/or (“FASB”) that Debt default, factors Board for — potential to Standards “Investments its due Accounting dividends, is or Financial impairment interest security’s the pay the to of specific inability believes its effect Company the include the the using means called including impairment or than-temporary securities, sold the are of securities when lives recognized estimated are the or losses are over method. accreted and securities identification are method gains securities Available-for-sale accumulated on Realized the level-yield as securities. premiums reported prepayments. and held-to-maturity which the and effects, equity tax Discounts as premiums securities using of equity. marketable net stockholders’ classified purchase mortgage-backed amortized depreciation, all in or are unamortized and appreciation income/loss and unrealized comprehensive they for debt any maturity, other with maturity, are adjusted to value fair to prior category at cost, reported prior sell available-for-sale amortized sell sell may to the at not to Company in stated intent required positive Securities are the be has discounts. securities management not If Such would purchase. securities. of Company time the the at and securities of classification appropriate and 2016 31, December at million $62.8 totaled requirement to reserve equal reserves 2015. The cash 31, maintain December deposits. to at System million certain Reserve $43.4 Federal of the percentage by required a is Company The institutions. financial undergoes and authorities regulatory financial state other and from federal competition to certain subject of is primarily regulations authorities. Bank regulatory customers the The those to by to York. examinations services New subject periodic banking and is provides Jersey and Bank New institutions The in offices Plan. branch Ownership through Stock Employee Bank economic Investors current The assumptions. and estimates Business our estimates. material these from highly in about inherent differ assumptions uncertainty and of may degree estimates the require results increased and has subjectivity environment Actual and complexity matters. of degree uncertain higher a involve they (c) (b) h opn eidclyeautstescrt otoi o te-hntmoayipimn.Other- impairment. other-than-temporary for portfolio security the evaluates periodically Company The the determines Management available-for-sale. securities and held-to-maturity securities include Securities other in deposits interest-bearing and banks from due amounts hand, on cash of consist equivalents Cash the to loan a and Bank the of stock common the holding is business primary Inc.’s Bancorp, Investors Securities ahEquivalents Cash NETR ACR,IC N SUBSIDIARIES AND INC. BANCORP, INVESTORS oe oCnoiae iaca Statements Financial Consolidated to Notes hnahl omtrt raalbefrsl etscrt is security debt sale for available or maturity to held a when , 87

FORM 10-K 88 Notes to Consolidated Financial Statements INVESTORS BANCORP, INC. AND SUBSIDIARIES Loans Receivable, Net To determine whether a security’s impairment is other-than-temporary, the Company considers factors that Loans receivable, other than loans held-for-sale, are stated at unpaid principal balance, adjustedThe by allowance for loan losses is increased by the provision for loan losses charged to earnings and is A loan is considered delinquent when we have not received a payment within 30 days of its contractual due The Company defines an impaired loan as a loan for which it is probable, based on current information, that (d) loss is presented in thedebt statement security of becomes income, other-than-temporarily lessof impaired, the the portion its total recognized amortized impairment in related cost other to basis comprehensive credit is loss. income. reduced When to a reflect the portion include, the durationinvestments until and they severityCompany’s recover intent of in to the sell valuerequired security (as impairment; to investments; well sell and the such as whethercredit securities it Company’s the loss. before is likelihood ability For more recoverytemporary of likely of debt and is than such their securities, not intent whether individual a that the orimpaired. amortized to recovery the not primary cost Company in hold basis it will consideration the less is be security in near any probable determining current-period term); that whether the current impairment or future is contractual other-than- cash flows have been or mayunamortized be premiums and unearnedadjustments discounts, net and deferred the origination allowanceearned. fees for Premiums and costs, loan and net losses.amortized discounts purchase to Interest on accounting interest income income purchased over on loans the loans estimated and life is net of accrued the loan loan and origination as credited an fees adjustment to todecreased and income yield. by costs as charge-offs, are netof deferred of the and recoveries. adequacy The of provision the(using for allowance the loan which appropriate considers, look-back losses and among isadverse loss other based situations emergence things, on that periods), the management’s known Company’s mayand evaluation and past affect current inherent loan economic the risks loss conditions. in borrower’s experience Whileloans, the management ability future portfolio, uses to existing additions available repay, may informationregulatory be to estimated recognize necessary value agencies, estimated based of losses on as on anyallowance changes for underlying in an loan economic collateral losses. or integral Suchupon other agencies their conditions. part may judgments In require and the of addition, information Company various available to their to recognize them additions examination at to the the time process, allowance of based their periodically examinations. date. review The accrual the of incomewhen Company’s on loans the is discontinued timely whendiscontinued interest are collection or designated principal as of payments non-accrual areincome loans such 90 and days on outstanding income in interest non-accrual arrearscollection is previously or loans credited of doubtful. is principal and reversed. Loans Interest isbeen impaired received considered on and loans doubtful. the which remaining A isis principal the loan completed is recognized which is deemed accrual indicates collectible. in returned that Loans of collectability to the are of generally accrual income the period charged full status off has principal collected after when balance an been is all unless analysis in amounts doubt. the duethe ultimate have lender will notevaluates collect commercial all loans amountsloans with modified due an in under outstanding a theoutstanding balance troubled balance contractual greater debt if terms restructuring than management ofdue (“TDR”), has $1.0 under the and specific million the other information loan contractual and commercial that agreement. termsto on it loans of determine The is non-accrual the greater that Company probable loan the than status, agreement theyof loan’s $1.0 for will the carrying million impairment. expected not value Impaired future collect is loans cash all not are flows. in amounts individually Smaller excess evaluated balance of homogeneous the loans fair are value evaluated of for the impairment collateral collectively or the present value

FORM 10-K au opoiefrftr et eei amns n h eerdaqiiincss(ot nurdb the by incurred at (costs million costs $152.5 acquisition surrender deferred and cash the the 2016 and at from payments) million 31, transferred $6.6 benefit and (funds December death 2016 reserve at future 31, stabilization December for claims million at provide of million the $152.8 $9.1 to statements of of value Repayment of consolidated reserve 2015. stabilization carrying the value The 31, claims in value. earning a December surrender carrying income and non-interest the 2015 cash a of non-interest 31, reduction as as a December of classified as recorded recorded is consists generally are and are value sheets value received proceeds balance carrying insurance consolidated and the the income of in date Increases the asset. of as contracts insurance assets. or respective leases respective the the of and of lives terms fixtures shorter. the useful is furniture, over whichever estimated method and assets, the the straight-line buildings of over the lives Office using basis the amortized amortization. accelerated are an and improvements using Leasehold depreciation depreciated accumulated are less equipment cost, at carried The FHLB. the with borrowings, outstanding our impairment. primarily any activities, less our cost, on at based carried FHLB is stock the of stock capital of on recognized accounting such are the for held-for-sale of criteria value the loans loans. carrying of the of satisfaction over the control sales our and surrendered on earnings. proceeds on have based we sale to losses sales transferor, the as a as and charges that, between as for provide Gains difference through accounted recognized which the are and sale. allowance transactions by deferred on These valuation determined are loans. loss are held-for-sale a loans and or in on dates gain costs settlement recognized the and are fees of origination any, component and if discounts and losses, Premiums unrealized Net basis. the to of due Reclassifications dates basis. prospective acquisition allowance. a loan on valuation yield the in a increase to an or in subsequent result accrual and and occur loans loss interest may the of a for yield flows cash payments as accretable expected are in required the adjustment, difference,” increases “non-accretable Contractually to income yield the interest loans. difference or a as acquisition, the non-accretable recognized at as of is expected recognized flows yield,” life cash “accretable the not undiscounted the the the and the (i.e., over or acquisition exceed allowance at loans, that method principal valuation expected PCI level-yield fair flows no the at cash with of the recorded undiscounted flows) value) utilizing the initially cash (fair between are amount future difference and carrying expected The 310-30 of initial losses). Subtopic value loan ASC present for with the allowance accordance by in determined for (as accounted value are loans PCI quality. impaired from excluded consumer specifically loans, are mortgage and residential impaired, include of loans definition Such Company’s the restructure. loans. meeting debt not trouble loans a and in loans, modified are they unless (h) (g) (f) (e) akondlf nuac scrida h mutta ol eraie ne h opn’ life Company’s the under realized be could that amount the at carried is insurance life owned Bank are equipment and fixtures furniture, and improvements leasehold buildings, Office cost. at carried is Land shares hold to required is (“FHLB”), York New of Bank Loan Home Federal the of member a as Bank, The aggregate an on determined as value, fair estimated or cost of lower the at carried are held-for-sale Loans credit to part, in due, is that discount a at acquired loans are loans, (“PCI”) Credit-Impaired Purchased tc nteFdrlHm onBank Loan Home Federal the in Stock on Held-for-Sale Loans akOndLf Insurance Life Owned Bank Net Equipment, and Properties Office NETR ACR,IC N SUBSIDIARIES AND INC. BANCORP, INVESTORS oe oCnoiae iaca Statements Financial Consolidated to Notes 89

FORM 10-K which permits an 90 Notes to Consolidated Financial Statements . The Company recognizes as separate assets the rights to service mortgage loans. . Core deposit premiums represent the intangible value of depositor relationships INVESTORS BANCORP, INC. AND SUBSIDIARIES Goodwill is presumed to have an indefinite useful life and is tested, at least annually, for Intangibles—Goodwill and Other (Topic 350): Testing Goodwill for Impairment, Borrowed Funds Other Real Estate Owned Intangible Assets Real estate owned (“REO”) consists of properties acquired through foreclosure or deed in lieu of Our FHLB borrowings, frequently referred to as advances, are over collateralized by our residential and non Core Deposit Premiums Mortgage Servicing Rights Goodwill. At December 31, 2016, the carrying amount of our goodwill totaled $77.6 million. In connection with our (j) (k) (i) foreclosure. Such assetsindependent are appraisals. carried Write-downs at requiredlosses. the at Thereafter, lower the decreases of timeadditional of property cost in maintenance acquisition or and the are protection fair properties’ expenses charged value, incurred to estimated in less owning the fair the estimated allowance properties. value selling for loan costs, are based charged on to income along with any residential mortgage portfolios as well as qualified investment securities. assumed in purchaseperiodically acquisitions evaluates the and valuevalue. are of core amortized deposit on premiums to an ensure accelerated the carrying basis amount exceeds over it 10 implied fair years. The Company The right to serviceinitial loans asset for recognized others for is originatedof mortgage generally MSR servicing obtained is rights through estimated (“MSR”) by the isamortized reference sale measured in to at of current fair proportion loans market value. with tomethod values The servicing of fair for and similar retained. value measurements over loans The of sold thedate. with our period servicing MSR. MSR released. of MSR MSR estimated impairment, are are component assessed net of if for fees servicing impairment and any, income.only based service We is on up charges. apply fair Subsequent to recognized the value increasesreported the at amortization in in as amount each income the when a of reporting fair the value the related valuation of mortgage previously loan impaired allowance recognized payments MSR are through valuation are collected. recognized allowance. charges Fees to earned for earnings servicing as loans a are insurance carrier for theare policy met issuance) at is the guaranteed2016 date by and on 2015. the which insurance a carrier contract provided is surrendered. that The certain Company conditions satisfied these conditions at December 31, entity to make aless qualitative assessment than of its whetherDecember it 31, carrying 2016, is the more amount Company’sfair likely qualitative before value than assessment of concluded not applying that the that ittest reporting the a was was unit reporting not not two-step is more required. unit’s less likely fair goodwill than than value not its impairment is that carrying the amount test. and, For therefore, the the two-step goodwill year impairment ended impairment at theimplied reporting fair unit value. level. Forreporting Impairment unit. purposes exists of when our the goodwill carrying impairment amount testing, we of have goodwill identified exceedsannual the its impairment Bank as assessment2011-08, a we single applied the guidance in FASB Accounting Standards Update (“ASU”)

FORM 10-K h lc-coe pinpiigmdluigasmtosfrteepce iiedyed xetdsokprice stock expected “ yield, dividend 718, expected ASC the with for accordance assumptions using in model awards pricing those option Black-Scholes of the value fair grant-date Compensation Stock the on based instruments of repayment the to a due the as participants of to recorded price Company. released is market the be to participants the to ESOP on to committed the contributions based allocated are by is Bank’s shares yet loan ESOP as not the the the recognized stock for from is expense common and repaid Compensation Company’s stock cost. being The Company’s at are years. equity 30 stock stockholders’ to of common up reduction Company’s of the period a purchase over to Company the from “ 718-40, ASC the made. are and contributions its SERPs as expense The recognizes and directors. participants provided. by are its contributed services 6% that to first period the benefits Company over The recognized provides are Code. plans which Revenue the of plan Internal costs the benefit the and by whose defined unfunded limited Company are nonqualified, Plan the are Directors’ of plan a employees pension has eligible the certain also under to contributions benefits provide and/or the which benefits on plans benefit based defined are nonqualified, plan pension the of Costs plan. the plan. to multiemployer made be a to in required and contributions participates facts Company The in requirements. changes as tax expense, unrecognized tax to income related to penalties credit and The enactment. interest or expense. of tax accrued period charge income the in recognizes in applicable, a expense where Company tax benefits, tax by The income when deferred are in on adjusted, years assets warrant. recognized effect the tax is The circumstances is rates realized. in deferred be tax allowance apply applicable, to in likely change to Where valuation not a expected settled. determined of portions rates or liabilities any and tax recovered are for assets be enacted allowance (ii) valuation to using and returns; a liabilities expected measured tax by and reduced are or are expected assets differences statements (iii) existing the financial temporary of and for amounts the those bases; recognized carrying in tax are statement recognized respective financial (i) been the their liabilities: have between and that differences to assets events attributable tax of deferred consequences tax Accordingly, future method. liability and asset consolidated the is in liability loss a or as gain Bank’s reported the no are in and carried securities be the securities, to repurchase continues transferred to agreements sheets. the the the obligations balance financing underlying to over as The securities resell recorded control portfolio. the are to of securities agreements effective agrees amount These maintains who agreement. dollar the The counterparty Bank of recognized. the call the or to as maturity delivered the transactions, at are securities agreements identical the the Bank underlying securities The FHLB. (m) (l) h opn eonzstecs fepoe evcsrcie necag o wrso equity of awards for exchange in received services employee of cost the recognizes Company The of provisions the with accordance in for accounted is (ESOP) plan the ownership of stock 50% matches employee Company The The employees. all substantially covering plan 401(k) a a has are Company The SERPs The (“SERPs”). Plans Retirement Employee Supplemental two has eligibility the Company satisfy The who employees all covers which plan pension benefit defined a has Company The “ 740, ASC with accordance in taxes income records Company The the and brokers selected with repurchase to agreements under securities of sales into enters also Bank The noeTaxes Income mlyeBenefits Employee mlyr’Acutn o mlyeSokOnrhpPlans Ownership Stock Employee for Accounting Employers’ .TeCmayetmtsteprsaefi au foto rnso h aeo rn using grant of date the on grants option of value fair share per the estimates Company The ”. NETR ACR,IC N SUBSIDIARIES AND INC. BANCORP, INVESTORS oe oCnoiae iaca Statements Financial Consolidated to Notes 91 noeTaxes Income ”Tefnsbroe yteESOP the by borrowed funds The .” ”a mne,uigthe using amended, as ,” Compensation-

FORM 10-K 92 Notes to Consolidated Financial Statements INVESTORS BANCORP, INC. AND SUBSIDIARIES Earnings Per Share Derivative Financial Instruments ASC 718 requires the Company to report as a financing cash flow the benefits of realized tax deductions in The per share fair value of options is highly sensitive to changes in assumptions. In general, the per share Basic earnings per common share, or EPS, are computed by dividing net income by the weighted-average Diluted EPS is computed using the same method as basic EPS, but includes the effect of all potentially As part of our interest rate risk management, we may utilize, from time-to-time, derivative financial Investors Bancorp, Inc. (the “Company”) is a Delaware corporation that was incorporated in December (n) (o) volatility, risk-free interest rateuncertainties and and, expected therefore, cannot optioncontains be term. certain determined inherent These limitations with assumptions when precision. are applied The to subjective Black-Scholes options in that option are nature, pricing not involve model traded on also publicexcess markets. of previously recognized taxBulletin benefits on No. compensation 107 expense. Indirectors (“SAB accordance within 107”), with “compensation SEC the and Staff fringe Accounting Companythe same benefits” classified line in item share-based the as consolidated compensation the statements cash for of compensation income employees paid. to and correspond outside with fair value of optionsinterest will rate move and in expected theFor option same example, term, direction and as the inincreases, changes risk-free per the in interest opposite the share rate expected direction increases,The fair stock as expected use price changes option value of volatility, in term different of risk-free increases thefair assumptions and values expected or options expected of different dividend options. dividend will option yield. yield pricing decreases. generally models could increase result as in materially expected different per stock share price volatility common shares outstandingweighted-average during number the of shares year. ofshares The common of stock restricted weighted-average outstanding stock common less andbeen the unallocated shares committed weighted shares outstanding average held to by numberreleased includes be the of are released ESOP. the unvested excluded For from are EPS outstanding considered calculations, shares on ESOP outstanding. a shares weighted ESOP that average have shares basis for that EPS have calculations. dilutive not common been shares that committed wereshares to outstanding of be during restricted the stock, period,we calculated such using add: as the (1) unexercised treasury stock therelated stock options method. assumed to and When proceeds unvested unvested applying shares from theprice of option treasury to stock restricted exercises calculate method, stock and sharesassumed and (2) to repurchased. stock be the The repurchased options. average is excess We added unamortized of then to compensation basic the divide weighted costs this number average common sum of shares by shares to our calculate issuable diluted average over EPS. stock the number of shares instruments which are recordedeffective as portion either of assets or changesinitially liabilities in recorded in in the Accumulated the fair Other consolidatedthe value Comprehensive balance period of Income sheet that and derivatives at the isvalue designated fair subsequently hedged of and value. reclassified the forecasted that The into derivatives transaction would earnings qualify be affects in as recognized earnings. directly cash The in flow earnings. ineffective hedges portion is 2. of Stock the Transactions change in fair Stock Offering 2013 to be the successor to Investors Bancorp, Inc. (“Old Investors Bancorp”) upon completion of the

FORM 10-K 334mlin rapoiaey$16 e hr.Drn h ereddDcme 1 05 h Company the 2015, 31, share. December per $12.13 ended approximately year or million, the $382.9 During of cost share. a at per on shares $11.60 31,576,421 plan purchased approximately repurchase or million, second $363.4 the shares. of 31,481,189 or completion stock, upon common immediately of shares commenced 2016. outstanding program 17, publicly-held June repurchase its on of new 10% plan The additional repurchase an first of purchase the shares. of 2016. 34,779,211 17, completion or June on stock, upon completed common was immediately program of second shares commenced The 2015. outstanding program 30, publicly-held June repurchase its of second 10% The additional an the of Accordingly, purchase 30, conversion. buyback June on step 5% completed second a was program its commence first of to The shares. completion System 17,911,561 the Reserve of repurchase had of Federal 2015. the it anniversary the authorized announced Directors Company one-year of of the Governors the Board 2015, of to 16, the March and Board prior On to, the program Board. notice prior Reserve from without Federal approval conversion the second-step received from, the non-objection of a completion of following receipt year first the during program 1,101,694 The of stock date. treasury conversion Programs in Repurchase the resulted Stock of awards step these as second to awards the were respect stock addition, MHC with In outstanding taxes Bancorp, equity. of all Investors stockholders’ payment of shares. of to for vesting increase shares assets accelerated an of net the the as withholding of the reflected in results conversion, are the resulted under and to the entities conversion immaterial Company by of are the transaction completion MHC raising into Bancorp, upon capital merged Investors Investors a therefore of as stock Old and results for common financial of Company accounted Company was of historical was MHC) share shares The conversion 137,560,968 Bancorp, The control. each of Investors exchange. common total offering, the A than stock. in other stock Investors common issued (stockholders Company the were the at of to stockholders shares stock stock of public 2.55 common common for by of of completion exchanged owned shares shares the 1,000,000 stock 219,580,695 2014. issued common of with 7, and total Bancorp May offering Concurrent a completed stock selling step Foundation. was became second by conversion Company Charitable the billion step the in $2.15 second and share contributed of Company The per proceeds the $10.00 Inc. Company net into Bancorp, raised merged Investors The Company Bancorp name The Investors the million. Old under and successor $509.7 exist), its to were ceased (and offering Bancorp initial the Bank. of or the charge to stock, from expense proceeds common pre-tax net a proceeds of the in offering). of shares resulting million public Net 3,949,473 Foundation $255.0 initial Charitable issued Bank to million. shares and Investors subsequent cash to 10,847,883 $20.7 combination shares, in outstanding business including million common its a of $5.2 outstanding offering, in Jersey 1.32% Company’s contributed New issued the the Company a shares of MHC, the in include 54.94% Bancorp, Additionally, to or Investors subscribers shares, restated offering, 165,353,151 (shares public to held initial stock company stock, the holding of common mutual completion shares, 131,649,089 Upon chartered outstanding selling ESOP. 2005 the its 11, Bancorp. by October Investors purchased on of Old offering of stock 43.74% company public holding initial or tier its top completed the Bancorp MHC, Investors Old Bancorp, Investors of conversion mutual-to-stock uigteya ne eebr3,21,teCmayprhsd3,3,6 hrsa otof cost a at shares 31,336,369 purchased Company the 2016, 31, December ended year the the authorized During which program, repurchase share third its announced Company the 2016, 28, the April authorized On which program, repurchase share second its announced Company the 2015, 9, June On repurchase stock a implement to permitted not was Company the regulations, federal applicable Under Investors Old into merged MHC Bancorp, Investors conversion, step second the with conjunction In NETR ACR,IC N SUBSIDIARIES AND INC. BANCORP, INVESTORS oe oCnoiae iaca Statements Financial Consolidated to Notes 93

FORM 10-K fair value Estimated losses Gross unrealized (In thousands) gains Gross unrealized At December 31, 2016 value Carrying 94 Notes to Consolidated Financial Statements INVESTORS BANCORP, INC. AND SUBSIDIARIES available-for-sale 1,673,695 4,649 24,571 1,653,773 Total mortgage-backed securities Federal Home Loan Mortgage CorporationFederal National Mortgage AssociationGovernment National Mortgage Association 603,774 1,971 1,022,383 47,538 2,678 7,306 — 16,474 598,439 1,008,587 791 46,747 Equity securitiesMortgage-backed securities: $ 5,825 918 83 6,660 Total available-for-sale securities $1,679,520 5,567 24,654 1,660,433 Available-for-sale: During the year ended December 31, 2014, prior to the second step conversion, the Company purchased Since September 2012, we have paid a quarterly cash dividend. Our dividend payout ratio forThe following the tables year present the carrying value, gross unrealized gains and losses and estimated fair value 1,295,193 shares at aMay cost 7, of 2014 $13.5 resulted million,payments in of or taxes the approximately with accelerated $10.44 respect vesting to per these of share. awards all The resulted outstanding in second the stock step purchase awards.Cash conversion of Dividends 1,101,694 The on shares. withholding of shares for ending December 31, 2016 was 40%. 3. Securities for available-for-sale securities andgains the and amortized losses cost, and net estimated unrealized fair losses, value carrying for held-to-maturity value, securities gross as unrecognized of the dates indicated:

FORM 10-K 2 neonzdgisadlse fhl-omtrt euiisaentrfetdi h iaca ttmns as statements, financial the in reflected not are securities held-to-maturity of losses and gains Unrecognized than (2) other the represent securities debt other and corporate held-to-maturity of losses unrealized Net (1) Held-to-maturity: hyrpeetfi au lcutosfo h ae f i h aeascrt sdsgae as designated is a security on a recognized is date charge the impairment (i) temporary of: than other later sheet. an balance the the that of date from date the through the fluctuations security, held-to-maturity (ii) value or fair it held-to-maturity; remaining the represent securities, over income mortgage-backed they comprehensive other For held-to-maturity accumulated to securities. through other transferred amortized securities. accumulated the securities the being of sale through is of life available-for and 1,782,801 amortized designated value life being previously fair on is remaining at 18,891 loss and net the the factors over represents non-credit other income to 46,136 comprehensive related charge 1,755,556 temporary 25,121 $1,780,677 securities held-to-maturity Total etsecurities: Debt otaebce securities: Mortgage-backed uiia od 798—3,7 ,1 39,493 — 1,515 37,978 — 37,978 debt other and Corporate bonds Municipal Government-sponsored oenetNational Government National Federal Loan Home Federal nepie ,2 ,2 2—2,140 84,245 — — 40,153 12 44,092 2,128 21,760 65,852 — 2,128 $ securities enterprises otaeAscain1,9 6322 16,420 — 28 16,392 407,424 1,233,079 3,502 15,389 — 3,635 16,392 793 1,244,833 1,802 410,133 Association Mortgage 1,246,635 1,559 Association Mortgage 411,692 Corporation Mortgage oa mortgage- Total securities debt Total edt-auiy16479331161384461,9 1,656,923 18,891 4,456 1,671,358 3,361 1,674,719 held-to-maturity 125,878 securities backed — 41,680 84,198 21,760 105,958 held-to-maturity NETR ACR,IC N SUBSIDIARIES AND INC. BANCORP, INVESTORS oe oCnoiae iaca Statements Financial Consolidated to Notes Amortized cost unrealized losses(1) 95 Net Carrying tDcme 1 2016 31, December At value I thousands) (In unrecognized gains(2) Gross unrecognized losses(2) Gross Estimated arvalue fair

FORM 10-K fair value fair value Estimated Estimated losses Gross Gross losses(2) unrealized unrecognized (In thousands) gains Gross unrealized At December 31, 2015 Gross gains(2) unrecognized (In thousands) value Carrying Value At December 31, 2015 Carrying Net 96 losses(1) unrealized cost Amortized Notes to Consolidated Financial Statements INVESTORS BANCORP, INC. AND SUBSIDIARIES backed securities held-to-maturity 1,767,027 5,207 1,761,820 9,643 9,202 1,762,261 held-to-maturity 105,648 23,245 82,403 44,022 — 126,425 available-for-sale 1,296,344 7,763 5,905 1,298,202 Total mortgage- Total debt securities Total mortgage-backed securities Mortgage CorporationMortgage 516,841 Association 2,502 1,228,845Mortgage Association 514,339 2,705 1,226,140 2,213authorities 21,330 7,305 3,082 — 6,120 513,470 1,227,325 21,330 125 11 — — 21,455 11 — — 11 enterprisessecurities $ 4,232 — 58,358 23,245 4,232 35,113 11 42,704 — — 77,817 4,243 Federal Home Loan Federal National Government National Federal housing Government-sponsored Municipal bondsCorporate and other debt 43,058 — 43,058 1,307 — 44,365 Federal Home Loan Mortgage CorporationFederal National Mortgage AssociationGovernment National Mortgage Association 546,652 3,242 24,841 724,851 2,443 4,520 547,451 1 3,299 726,072 163 24,679 Mortgage-backed securities: Debt securities: Equity securitiesMortgage-backed securities: $ 5,778 733 16 6,495 Total held-to-maturity securities $1,872,675 28,452temporary 1,844,223 charge relatedcomprehensive to 53,665 income other non-creditrepresents over factors the the net and lossat remaining is on 9,202 fair previously being life value designated amortized and available-forlife of is through sale of being 1,888,686 the securities the accumulated securities. amortized transferred other through securities. to accumulated held-to-maturity For other comprehensive mortgage-backed income over securities, the remaining it Held-to-maturity: Total available-for-sale securities $1,302,122 8,496 5,921 1,304,697 Available-for-sale: (1) Net unrealized losses of held-to-maturity corporate and other debt securities represent the other than

FORM 10-K o nlddi h olwn al.Teaotzdcs n siae arvleo etscrte at securities debt of value fair estimated and cost amortized are The securities below. mortgage-backed table. shown are therefore, maturity, following issuer, contractual due the by maturities the 2016, of contractual 31, effective privileges from in December with differ call years may included early maturities 20 or Expected not than prepayments prepayments. less loan to generally underlying due are shorter to securities be to mortgage-backed expected Bank’s lives the of maturities deferrals, flow contractual cash of discounted events is and value structure, payments, Fair interest TruPS respectively. and the million, principal $72.9 of for and cashflow terms projected million modeling. including the $37.1 assumptions, liquidations, of 2016 and 31, respectively. value specific December defaults million, fair considering at $79.2 estimated grade and from non-investment and million as derived $39.1 cost lesser classified 31, of securities amortized a December value purchase, an to At fair at had estimated obligations. and grade and investment debt banks cost were collateralized by amortized all and While an issued trusts, had principally TruPS investment (“TruPS”), the estate 2016 securities real preferred companies, trust insurance extent pooled by backed obligations as statements, financial the in reflected not are securities held-to-maturity of losses and gains Unrecognized (2) prxmtl 494mlino h opn’ euiisaepegdt euebroig.The borrowings. secure to pledged are securities Company’s the of million $469.4 Approximately debt collateralized of as portfolio a designated include is securities security debt a a other on and date recognized corporate the is 2016, charge (i) 31, impairment of: December other-than-temporary At later an sheet. balance the the that of date date from the through the fluctuations security, held-to-maturity (ii) value or fair held-to-maturity; represent they u fe e er 36785,312 43,647 33,348 5,003 $33,348 2,215 5,000 2,203 years ten years after ten Due through years five years after five Due through year one after less Due or year one in Due oa 8,9 125,878 $84,198 Total NETR ACR,IC N SUBSIDIARIES AND INC. BANCORP, INVESTORS oe oCnoiae iaca Statements Financial Consolidated to Notes 97 Carrying Value eebr3,2016 31, December I thousands) (In Estimated arvalue fair

FORM 10-K losses Unrealized Total fair value Estimated losses Unrealized (In thousands) 12 months or more December 31, 2016 fair value Estimated losses Unrealized 98 Less than 12 months fair value Estimated Notes to Consolidated Financial Statements INVESTORS BANCORP, INC. AND SUBSIDIARIES securities available-for-sale 1,215,897 23,988 37,845 583 1,253,742 24,571 Total mortgage-backed CorporationAssociation 339,666 3,354 970,194 3,623 15,389 148 — 343,289 — 3,502 970,194 15,389 CorporationAssociationMortgage Association 406,878 7,220 46,747 12,756 762,272 15,977 791 25,089 86 — 497 419,634 7,306 — 787,361 16,474 46,747 791 Federal Home Loan Mortgage Federal National Mortgage Federal Home Loan Mortgage Federal National Mortgage Government National Mortgage-backed securities: Equity SecuritiesMortgage-backed securities: $ 4,722 83 — — 4,722 83 Total held-to-maturity securitiesTotal $1,309,860 18,743 3,623 148 1,313,483 18,891 $2,530,479 42,814 41,468 731 2,571,947 43,545 Total available-for-sale securitiesHeld-to-maturity: 1,220,619 24,071 37,845 583 1,258,464 24,654 Available-for-sale: Gross unrealized losses on securities and the estimated fair value of the related securities, aggregated by investment category andposition length at December of 31, 2016 time and that December 31, individual 2015, was securities as follows: have been in a continuous unrealized loss

FORM 10-K n diinlOT hre o h eid ne eebr3,21 n 05 tDcme 1 2016, 31, December At 2015. and 2016 31, recognize not December did ended and value periods book the the than for greater was that charges security deemed for each OTTI management assumptions for 2015, flows using additional and cash forecast any 2016 projected are 31, of security December value each At present for amortization. the flows and Cash pre-payments securities. recoveries, preferred defaults, trust pooled our underlying credit The net factors. income, related comprehensive other non-credit accumulated other to The adjustment income. all the an non-interest and as in estimate tax. recorded charge credit a of will be impairment If to will Company other-than-temporary component other-than-temporary. an attributable the related as is is non-credit impaired, recognized decline be that other-than-temporarily will such loss is component whether unrealized related security and the debt cost, of a amortized that amount or made cost is its determination below declined has security (“OTTI”) Impairment Other-Than-Temporary rates. of interest values market fair intermediate-term in The increase Enterprises. recent Sponsored the Government by U.S. impacted negatively by been issued have securities securities of these comprised is which portfolio Available-for-sale: ihteassac favlainseils,w vlaetecei n efrac fec issuer each of performance and credit the evaluate we specialist, valuation a of assistance the With 15,123 1,607,362 1,370 any of value 48,721 the if determine 13,753 to portfolio securities $1,558,641 the of evaluation and review quarterly a conduct We 9,202 923,928 921 mortgage-backed-security our to relate primarily losses 33,900 unrealized gross 2015 8,281 and 2016 31, December 890,028 At $ 5,921 683,434 Total 449 securities held-to-maturity Total 14,821 5,472 668,613 Held-to-maturity: securities available-for-sale Total qiyScrte ,9 6——46216 4,692 — — 16 4,692 $ securities: Mortgage-backed Securities Equity otaebce securities: Mortgage-backed oenetNational Government Mortgage National Federal Mortgage Loan Home Federal eea ainlMortgage National Federal Mortgage Loan Home Federal otaeAscain2,7 6 484163 24,874 3,299 2,443 390,613 263,255 — 449 — — 14,821 2,850 — 163 375,792 24,874 2,443 263,255 Association Mortgage Association Corporation soito 4,2 ,7 9036356396,120 576,339 3,082 643 347,589 278 29,013 5,477 4,887 547,326 2,804 342,702 Association Corporation oa mortgage-backed Total vial-o-ae63915461,2 4 7,4 5,905 678,742 449 14,821 5,456 663,921 available-for-sale securities NETR ACR,IC N SUBSIDIARIES AND INC. BANCORP, INVESTORS oe oCnoiae iaca Statements Financial Consolidated to Notes Estimated arvalue fair esta 2months 12 than Less 99 Unrealized losses Estimated arvalue fair eebr3,2015 31, December 2mnh rmore or months 12 I thousands) (In Unrealized losses Estimated arvalue fair Total Unrealized losses

FORM 10-K 2014 2015 (In thousands) 2016 For the Years Ended December 31, 100 Notes to Consolidated Financial Statements INVESTORS BANCORP, INC. AND SUBSIDIARIES expected cash flows (4,457) (3,804) (3,418) Initial credit impairmentsSubsequent credit impairmentsAccretion of credit loss impairment due to an increase in Reduction for securities sold or paid off during the period — (4,813) — — — — — — — The credit loss component of the impairment loss represents the difference between the present value of Gains and losses on the sale of all securities are determined using the specific identification method. For the For the year ended December 31, 2016, the Company received sale proceeds of $14.3 million on a pool of For the year ended December 31, 2015, the Company received proceeds of $2.6 million on an equity Balance of credit related OTTI, end of period $ 95,743 100,200 108,817 Balance of credit related OTTI,Additions: beginning of periodReductions: $100,200 108,817 112,235 The following table presents the changes in the credit loss component of the impairment loss of debt expected future cash flowsbeginning and the balance amortized represents costimpairment basis occurred the prior of credit to the thefor securities loss credit period prior impaired presented. component to debt If securities, considering other-than-temporary forthe they credit impairment first would debt losses. time is be a recognized The presented securities debt inwas as security earnings credit additions for was impaired based credit which (subsequent upon impaired whether creditintends other-than-temporary (initial the impairments). to current credit The sell period impairment) credit is or or losscredit is believes component loss not is it component the reduced will is first if be reducedover the time required Company if a the to sells, debt (i) remaining sell security the life previously Companywritten of down. receives credit the cash impaired credit flows debt impaired in securities. debt excess Additionally, security, of the what (ii) it the expected securityRealized to matures Gains receive or and Losses (iii) the security is fully year ended December 31,pools 2016, of mortgage-backed the securities Company sold$2.3 received from million. sale the available-for-sale proceeds portfolio of resulting $57.9 in a million gross on realized equity gain of securities and mortgage-backed securities from theThese held-to-maturity securities portfolio met resultingtherefore the in did criteria a not of gross resultmanagement’s realized principal assessment in gain market a pay pricing of taintingand downs presents when $836,000. of securities under an with the economic 85% smaller held-to-maturity balance benefit of become portfolio. that cost the The outweighs prohibitive to original holding Company carry. such sells investment securities, securities amountsecurity when, and from in the available-for-sale portfolio resulting in a gross realized gain of $1.5 million. For the year ended non-credit related OTTI recorded($12.9 on the million previously after-tax). impairedsecurities. This pooled trust amount preferred is securities being was accreted $21.8 million into income over thesecurities estimated that remaining the Company life hasearnings. of written the down for such loss as an other-than-temporary impairment recognized in

FORM 10-K 1 nlddi nmrie rmusaddfre oncssaeaceal ucaeacutn adjustments accounting purchase accretable are costs loan deferred and premiums unamortized in Included (1) losses no were there 2014 31, December Net ended Receivable, security Loans year TruP 4. a In the on carry. For $50,000 to of Trustee. gain prohibitive its The a cost recognized by portfolio. Company become liquidated held-to-maturity the recognized. securities 2014, entirely the that 31, balance benefit was of December the smaller economic ended which of tainting an when year 85% assessment, a the and under management’s for in securities, downs addition, in pay result such presents, principal pricing holding not of market outweighs did criteria when the therefore securities resulted sales met million sells and 2014, $18.3 securities Company 31, of amount These December value $877,000. book ended investment a of year had original the gains which For realized portfolio, $927,000. held-to-maturity gross the of in from gains securities realized back gross The mortgage in of the available-for-sale. resulted $474,000. the which to of of in gains million, security realized evaluation $19.2 gross preferred the held in resulting of trust 2014, result securities one 31, a December reclassified ended As equity year Company Rule. the for the Volcker of security certain the Rule, the sold Wall as of Volcker distributions Company Dodd-Frank known treatment the the Act, the of capital of sections Protection on implement impact Consumer rule to to and securities a preferred Reform adopted related trust Street agencies by backed regulatory were obligations 2013, debt collateralized December $145,000 In portfolio. which available-for-sale of security TruP a $619,000, on $646,000 of loss a recognized Company Trustee. the its 2015, by 31, liquidated December was which ended year the for however capital to related portfolio. $145,000 available-for-sale of the in securities held available-for-sale securities on equity gains of recognized distributions Company the 2015, 31, December ncneto ihlasacquired. loans with connection in follows: as was 2015 31, December and 2016 31, December of as portfolio loan the of detail The were portfolio held-to-maturity the from securities of proceeds total 2014 31, December ended year the For of securities available-for-sale on gains net recognized Company the 2014, 31, December portfolio, ended year held-to-maturity the from For securities of sales no were there 2015, 31, December ended year the For C on ,5 11,089 8,956 (218,505) (228,373) 496,103 224,057 596,922 5,037,898 314,843 4,710,373 6,255,904 3,821,950 7,459,131 1,044,329 $ losses loan for Allowance 4,445,194 1,275,283 loan deferred and premiums unamortized Net loans PCI loans other and Consumer loans mortgage Residential loans Construction loans industrial and Commercial loans estate real Commercial loans Multi-family ot()(244 (11,692) (12,474) costs(1) e on 1,6,5 16,661,133 $18,569,855 16,880,241 11,346,240 18,801,746 13,494,451 loans Net loans PCI excluding loans Total loans commercial Total NETR ACR,IC N SUBSIDIARIES AND INC. BANCORP, INVESTORS oe oCnoiae iaca Statements Financial Consolidated to Notes 101 eebr31, December 2016 I thousands) (In eebr31, December 2015

FORM 10-K 2014 2015 2015 Years Ended December 31, 2016 (In thousands) (In thousands) Years Ended December 31, 2016 102 Notes to Consolidated Financial Statements INVESTORS BANCORP, INC. AND SUBSIDIARIES Net charge-offs (9,882) (7,779) (11,144) Balance, end of period $1,451 449 Balance, beginning of periodAcquisitionsAccretionNet reclassification from non-accretable difference(1) 1,221 — $ 449 971 — (219) — (522) The allowance for loan losses is the estimated amount considered necessary to cover credit losses inherent The allowance for loan losses has been determined in accordance with U.S. GAAP, under which we are Balance at beginning of theLoans period charged offRecoveriesProvision for loan lossesBalance at end of the period $218,505 200,284 173,928 (14,997) (12,216) $228,373 19,750 (18,244) 218,505 26,000 5,115 200,284 37,500 4,437 7,100 acquisition dates due to increases in expected cash flows ofAn the analysis loans. of the allowance for loan losses is summarized as follows: Purchased Credit-Impaired (“PCI”) loans, are loans acquired at a discount that is due, in part,The to following credit table presents changes in the accretable yield for PCI loans during the years ended in the loan portfolio atthat the is balance charged sheet against date.therefore, income. The In have allowance determining identified is the established theallowance allowance through for allowance for the loan loan as losses provision losses, is for ajudgment considered we loan critical a involved, make losses critical accounting significant the accounting estimates policy.environment policy subjectivity and that by The could management of methodology result because in the of for changes the assumptions determining to high the degree the used, amount of of and the recorded the allowance potential for loanrequired for losses. to maintain changes an in allowanceand for the periodic probable economic losses determination atlosses the of is balance the adequate sheet to date. amount cover Wewhich of specifically are certain identifiable responsible the losses losses, for are allowance as the probable welldate timely required. but as of not We estimated acquisition specifically losses with believe identifiable. inherent no Loans that in valuation acquired our allowance our are portfolio reflected allowance for marked in to the for fair allowance loan for value loan on losses. the In conjunction with the (1) Reclassifications of the non-accretable difference to the accretable yield may occur subsequent to the loan Purchased Credit-Impaired Loans quality. PCI loans arevalue accounted as for determined in by accordancethe the allowance with present for ASC value loan Subtopic of losses. expected 310-30 future and cash are flows initially with recorded no at valuation fair allowanceDecember reflected 31, in 2016 and 2015:

FORM 10-K u onprflo ebleetepiayrsst u onprfloaeicessi neetrts eln in decline a rates, interest in increases are also portfolio of loan We composition our the loans. to loans on Based of risks mortgage York. concentration primary New a residential the and in Jersey believe resulted of New we in activities portfolio, purchase located These businesses loan credit. and and our of property lines estate origination in equity real home by inherent the secured and is and loans equity that loans home originate uncertainty industrial the and and commercial imprecision for margin a reflects losses. allowance credit liquidation probable overall of estimated estimates flow the reflect the cash to that of discounted reduced ensure value a then fair or is the property property of real real for estimate for available an value Any value appraised loan, exposure. appraised The particular loss current business. expenses. a as potential most a evaluated on is for the on loss collateral on evaluated of analysis of likelihood determine based are the adequacy to if is impaired charge-off analyzed the collateral or be are allowance determine loans to specific To a specific determined of probable. process, recommendation Loans evaluation a loss. in this results of In shortfall losses. risk loan loan potential for for their allowance allowance the the of than adequacy results. financial different our be on effect may negative losses in material a changes loan have upon could Actual based which revisions conditions. established significant have market to we susceptible from estate losses inherently general be is differ real trends, may but to that delinquency and trends, estimates portfolio and the industry economic material loan the and of requires procedures things, in study it and other inherent as a policies among subjective losses lending upon on qualitative concentrations, credit based based for credit estimated is account determined conditions, cause to evaluation economic is adjusted This to and be experience. likely also charge-off), loss recognition may are loan actual historical factors that emergence the loss partial to factors loss The or bankruptcy) segment. environmental The personal full loan or a accordingly. by first as experience factor (such the loss accurately event loss via past loss to Company’s a historical (typically the of data for loss each date period the of the adjusts emergence from of and amount time loss estimated segment the appropriate historical the assesses loan (if the is Company’s management period each the provide Additionally, rating of on end. to rise. based risk losses period rates determined determined of interest expected loan, if period as generally risk losses are of look-back credit expected factors more fixed a estimate type loss to between over subject the by subdivided be or experience to is segment loans deemed loss portfolio loan are for remaining loans each residential loan or, rate for expenses. Company’s the adjustable the Reserves flows selling the as segregating of loans and cash addition, rate conditions terms by In future adjustable market and contractual history. specific expected determined for payment the of adjusted has is and under collateral value applicable) management allocation due debt the present amounts of if troubled general the value all a million The an determining fair collect with in the $1.0 by not loan loans, modified than measured commercial will collateral-dependent loans a they is greater is status, probable Impairment it loans non-accrual is if agreement. commercial on impaired it are be that other and allocations to information million and deemed Specific is $1.0 allocations. (“TDR”), loan general than A restructuring and greater impaired. specific be balance components: to two outstanding determined has loans loans losses PCI for loan to made for related allowance the $52,000 of of charge-offs recorded on loss. Company analysis loan If the for an loans. allowance 2016, the those performs of 31, to Company calculation relation December its in the in ended acquired. deterioration loans loss, year subsequent these loan include been the will has for For Company there the allowance not occurred, or the has whether deterioration of determine adequacy to loans the acquired of evaluation quarterly u edn mhsshsbe h rgnto fcmeca elett on,mlifml loans, multi-family loans, estate real commercial of origination the been has emphasis lending Our to attempt management’s reflect reserves These unallocated. as identified reserves contains allowance The the evaluate to order in assets loan various of status current the reviews management basis, quarterly a On analysis The losses. loan for allowance the of adequacy the of evaluation quarterly a performs Management NETR ACR,IC N SUBSIDIARIES AND INC. BANCORP, INVESTORS oe oCnoiae iaca Statements Financial Consolidated to Notes 103

FORM 10-K 104 Notes to Consolidated Financial Statements INVESTORS BANCORP, INC. AND SUBSIDIARIES For commercial real estate, multi-family and construction loans, the Company obtains an appraisal for all For homogeneous residential mortgage loans, the Company’s policy is to obtain an appraisal upon the Management believes the potential risk for outdated appraisals for impaired and other non-performing loans Although we believe we have established and maintained the allowance for loan losses at adequate levels, the general economy, and declinesAny in real one estate market ordelinquencies, values loan in combination losses New and Jersey, of futureis New levels York collateralized these of and loan surrounding by loss events states. determining provisions. real the As may estate, a amount substantial adversely of appraisalsinstrumental amount the of of affect allowance our in the loan required oursignificantly portfolio underlying for determining loan impact specific value the loans. the portfolio ofassumptions Assumptions valuation value supporting property resulting for such of appraisal securing in appraisals of a valuationsreflect loans are amounts increased are property carefully properties. realizable are reviewed on securing critical the to Negative related a determine in loans. that loan changes the and resulting to values the reasonably appraisal relatedcollateral allowance assumptions determined. dependent could The substandard loans or worse upon with arated balance origination. special of $500,000 mention An or with greater.reserve updated a An or updated balance charge appraisal off appraisal of is needed.dependent $2.0 obtained As is commercial million biennially part for of real or obtained loans the estate greater. allowancebeen loan This for annually an classified loan is adverse loss as done for process, change non-accrualcommercial in the in and/or Company loans order lending the impaired reviews to officers each and collateral rated determine and collateral assessesreal value the its whether estate supporting specific credit there the conditions has department loan. inBased and The our on special Company lending the asset utilizes area severitywarranted department’s information to of knowledge from or the identify of its if changes if changesdeterioration downward in in possible of market the deterioration adjustments collateral conditions, of todownward value management collateral is adjustments the determines value significant to previous if enough hasnecessary the to an appraisal occurred. until warrant existing updated the are ordering updated appraisal appraised a appraisal warranted. is new is value received. appraisal, If is an it used estimate of is in the assessing determined if thatorigination additional of the specific the loan reservesappraisal and are is an updated updated every appraisal twonot in years been the if completed. event the Management a adjusts loanand loan the remains declines appraised becomes in in value non-performing 90 the of status days real residential and estate delinquent. loans the market. Thereafter, to foreclosure reflect the process estimated has selling costs has been mitigated duevalue to is the not fact thatcompleted in which the excess indicates loans that of are collectability the of individually the fair assessed full to value principal balance determine of is that in the the doubt. collateral. loan’sadditions Loans carrying are may generally beinformation charged available; necessary off however, after the ifsignificant an level judgment the of analysis and the short-term is current allowance change.Jersey for In economic Department addition, loan of the environment losses Banking Federal remainsreview and Deposit deteriorates. an our Insurance Insurance, estimate allowance Corporation Management as that and for anbased the is uses loan on integral New subject their losses. part relevant to judgments Such of about agencies their information available examination may to process, require them will us at the periodically to time recognize of their adjustments examination. to the allowance

FORM 10-K loac o onlosses: loan for Allowance by loans in investment recorded 2015: the and and 2016 31, losses December loan ended years for the of allowance as the method impairment in on balance based and the segment present portfolio tables following The aac at 5,115 Balance 19,750 with — acquired Loans 884 (14,997) 102 evaluated 12 Collectively 1,631 evaluated (3,818) — Individually Loans: 267 (419) 4,644 (9,425) at Balance 6,851 541 (52) 5,563 with (4,485) 689 acquired Loans 5,614 (455) evaluated Collectively 1,885 (161) evaluated Individually balance- Ending Provision Recoveries Charge-offs balance- Beginning ult ,0 ,0 4 8,956 — 343 1,507 — — 34,404 — — — — 371 7,106 18,810,702 — — 24,453 — 1,601 597,265 4,711,880 — 18,767,342 — 314,843 — 1,275,283 228,373 — 4,452,300 $7,459,131 3,370 596,551 — 4,685,920 20 2016 2,190 31, 314,843 December 5,962 2,850 1,271,913 226,772 4,439,232 1,581 7,458,883 19,831 248 quality — credit deteriorated 2,190 11,653 — $ 2,830 impairment 43,492 — for 18,250 52,796 impairment — 11,653 for 228,373 95,561 43,492 $ 2,190 — 2016 52,796 31, 2,850 December 95,561 19,831 218,505 — quality 11,653 credit deteriorated 1,306 43,492 $ 3,155 impairment for 52,796 31,443 impairment 95,561 for 6,794 $ 2016 40,585 31, December 46,999 88,223 $ 2015 31, December NETR ACR,IC N SUBSIDIARIES AND INC. BANCORP, INVESTORS Family Multi- Loans oe oCnoiae iaca Statements Financial Consolidated to Notes Commercial elEstate Real Loans n Industrial and Commercial Loans 105 Dlasi thousands) in (Dollars Construction eebr3,2016 31, December Loans Residential Mortgage Loans Consumer n Other and Loans Unallocated Total

FORM 10-K Total Unallocated Loans and Other Consumer Loans Mortgage Residential Loans December 31, 2015 Construction (Dollars in thousands) 106 Loans Commercial and Industrial Loans Real Estate Commercial Notes to Consolidated Financial Statements Loans Multi- Family INVESTORS BANCORP, INC. AND SUBSIDIARIES — A “Watch” asset has all the characteristics of a Pass asset but warrant more than the normal level of — “Pass” assets are well protected by the current net worth and paying capacity of the obligor (or December 31, 2015 $6,255,904 3,829,099 1,044,385 225,843 5,039,543 496,556 — 16,891,330 2015for impairmentfor impairment $ $ 88,223deteriorated credit 3,219 46,999quality 6,252,685 3,803,009 18,941 1,034,934 40,585 221,553 9,395 5,015,359 495,714 6,794 2,504 — 31,443 16,823,254 3,155 22,539 1,306 — 389 218,505 — 7,149 56,987 56 1,786 1,645 453 — 11,089 December 31, 2015 $for 88,223 impairment 46,999for impairment $ 40,585deteriorated credit quality — 6,794 88,223 31,443 46,999 — 3,155 1,306 38,176 2,409 218,505 6,794 — — 29,670 3,146 1,306 1,773 — 214,314 9 — — — 4,191 — — — — December 31, 2014 $ 71,147 44,030 20,759 6,488 47,936 3,347 6,577 200,284 The Company categorizes loans into risk categories based on relevant information about the ability of borrowers Pass Watch Balance at Balance at December 31, Loans: Individually evaluated Collectively evaluated Loans acquired with Ending balance- Individually evaluated Collectively evaluated Loans acquired with Beginning balance- Charge-offsRecoveriesProvision (284) (1,021) 445 16,915 (516) 3,183 807 (466) 20,047 295 (9,526) 455 (403) 317 — (9,262) 2,295 (67) (12,216) (5,271) 278 26,000 — 4,437 to service their debt suchinformation as: and current current financial information, economiccommercial historical trends, real payment among estate experience, other loans credit factors. the documentation,assesses Company public For the analyzes non-homogeneous the probability loans, loansCompany such of individually uses as by the collection following commercial classifying for definitions the and for loans each risk as ratings: type to credit of risk class. and Thisguarantors, analysis if any) is or by performed the fair on value, a less cost quarterly to acquire basis. and sell, The supervision. of These any underlying loans collateral may inmay a require not timely more conform manner. detailed tooperating reporting policy profitably, to provided, or however, management adverse the30-59 because events days events some are may do considered aspects not have watch constitute of affected if an not underwriting or undue already could credit identified risk. as affect impaired. Residential the loans cash delinquent flow or ability to continue Allowance for loan losses:

FORM 10-K osmradohr427539747894——496,103 224,057 — — — 5,037,898 — 8,974 — 3,725 — 6,255,904 427 1,044,329 — 3,821,950 68,557 — — — — 3,987 13,796 — — 37,032 12,833 596,922 482,715 24,584 13,546 40,380 207,499 17,033 — 314,843 4,930,961 13,782 38,265 — 325,414 — 4,710,373 223,474 5,876,425 other 7,436 331,429 $ and Consumer — — 793,527 mortgage 3,411,876 Residential — 4,240 7,459,131 719 1,275,283 Construction 77,650 industrial — 4,445,194 and Commercial — estate 3,200 real Commercial — — 5,627 — Multi-family 10,239 loans: Commercial — 76,773 54,516 583,140 6,877 21,873 230,630 36,733 4,600,611 165,948 23,588 134,154 276,858 344,628 6,961,809 other 373,319 $ and Consumer 900,190 mortgage 3,900,988 Residential Construction industrial and Commercial estate real Commercial Multi-family loans: Commercial As occur. or will loans: recovery PCI recovery excluding no the loans has of when class or asset much, an write-off. how the that whether, defer to mean about desirable or doubt necessarily or allowance practical much not valuation not is specific is does there it a such, classification of rather, establishment but This without value; warranted. asset, salvage an not as is books institution’s charge-off, the on and continuance questionable its highly full values. in and liquidation conditions, or facts, known collection currently make of weaknesses basis the the or on that days improbable characteristic 90 added delinquent the loans with or Residential weakness, the corrected. substandard. well-defined that considered not possibility a are are impaired distinct have as deficiencies the must identified by the those classified characterized as if so are well loss as Assets They greater some debt. any. sustain the if of will pledged, liquidation institution collateral the the jeopardize by that weaknesses or loans obligor Residential adversely the not classification. of impaired. are adverse as assets warrant identified Mention to already Special not risk if date. sufficient mention future prospects to special some considered repayment institution are at the an days position of 60-89 expose credit delinquent deterioration not institution’s in do the result and in may classified or weaknesses asset potential the these for uncorrected, left If attention. oa 1,0,0 2,2 3331224——16,880,241 — — 172,214 83,303 11,346,240 921,721 — $15,703,003 — 94,683 18,801,746 69,080 — 893,150 Total — 10,289,327 187,452 loans commercial Total 337,848 1,099,078 13,494,451 $17,177,368 — — 102,366 326,890 Total 1,071,578 11,993,617 loans commercial Total by 2015 31, December and 2016 31, December of as loans of category risk the present tables following The Loss Doubtful Substandard Mention Special nasto oto hro,casfe Ls”i osdrducletbeado uhltl au that value little such of and uncollectible considered is “Loss” classified thereof, portion or asset An — nastcasfe Dutu”hsaltewanse neeti n lsiidsubstandard classified one in inherent weaknesses the all has “Doubtful” classified asset An — Sbtnad se siaeutl rtce ytecretwrhadpyn capacity paying and worth current the by protected inadequately is asset “Substandard” A — SeilMnin se a oeta ekessta eev aaeetsclose management’s deserve that weaknesses potential has asset Mention” “Special A — NETR ACR,IC N SUBSIDIARIES AND INC. BANCORP, INVESTORS oe oCnoiae iaca Statements Financial Consolidated to Notes Pass Pass Watch Watch 107 pca Mention Special Mention Special eebr3,2015 31, December 2016 31, December I thousands) (In thousands) (In Substandard Substandard Doubtful Doubtful Loss Loss Total Total

FORM 10-K Total Total amount Loans Loans Receivable Receivable December 31, 2015 # of loans Current Current amount (Dollars in thousands) Due Due Total Past Total Past December 31, 2016 (In thousands) (In thousands) # of loans December 31, 2015 December 31, 2016 Days Days than 90 than 90 Greater Greater 60-89 Days 60-89 Days 108 30-59 Days 30-59 Days Notes to Consolidated Financial Statements INVESTORS BANCORP, INC. AND SUBSIDIARIES Multi-familyCommercial real estateCommercial and industrialConstructionResidential and consumer 24 8 2 9,205 4,659 478 $ 37 — 17 79,928 482 500 10,820 4 9,225 — 91,122 $ 3,467 4 792 The following table presents non-accrual loans excluding PCI loans at the dates indicated: Total commercial loansTotal 19,364 352 13,493 33,209 11,313,031 11,346,240 $50,443 15,735 91,029 157,207 16,723,034 16,880,241 Total $42,383 45,597 74,834 162,814 18,638,932 18,801,746 Total commercial loans 12,704 33,948 9,650 56,302 13,438,149 13,494,451 The following tables present the payment status of the recorded investment in past due loans as of Total non-accrual loans 512 $94,274 562 $115,426 Non-accrual: Total commercial loans 34 14,346 62 24,304 Residential mortgageConsumer and other 27,092 14,956 3,987 68,560 110,608 427 4,927,290 8,976 5,037,898 13,390 482,713 496,103 Commercial loans: Multi-familyCommercial real estateCommercial and industrialConstruction 4,171 957 $14,236 352 — — 6,429 4,386 10,952 — 1,886 5,343 3,810,998 16,122 3,821,950 1,038,986 6,239,782 — 1,044,329 6,255,904 792 792 223,265 224,057 Commercial loans: Multi-familyCommercial real estateCommercial and industrialConstructionResidential mortgageConsumer and other 6,568 864 $ 31,964 5,272 885 6,445 1,099 24,052 44,977 2,971 — 234 10,930 4,400,217 5,627 4,720 58,119 4,445,194 6,605 1,270,563 93,101 — 719 7,452,526 1,275,283 4,617,272 7,459,131 7,065 4,710,373 — 13,411 583,511 — 596,922 314,843 314,843 December 31, 2016 and December 31, 2015 by class of loans excluding PCI loans:

FORM 10-K oa omrillas21973,217 7 and received income interest 2015, 169 and and 2016 2016 31, 31, respectively. December $6,555 million, December ending $2.8 periods and ended the million for $1.5 2 years totaled million loans $4.2 18 the these and on million recognized allocations During $1.6 with of respectively, of respectively. million, losses $57.0 value loan 2015, more and for carrying million or allowance $3,038 $34.4 the a days totaled of which 90 with loans were dependent loans collateral which primarily PCI 16 of million million 2015, of $9.0 $2.1 31, million and of $1.3 December current value and of were delinquent carrying which As days a of 30-89 delinquent. with million were loans more $9.0 delinquent. which PCI or included of 2016, million none days 31, $11.1 current, 90 were December were which of 3,498 of which As million flows. $7.7 cash included future expected 5 of 597 $6,876 non-accrual 3 as classified TDR 20 current Total $6,318 loans commercial Total 26 non-accrual: as classified delinquent days 30-89 TDR indicated: dates the at non-accrual non-accrual as classified TDR current Total loans commercial Total non-accrual: as classified TDR Current accrual following: for the criteria of the comprised are meet loans payment not these current do 2015, their 31, therefore maintained December and not and terms 2016 have restructured 31, loans December the the of under as As months non-accrual status. consecutive as six classified for has Company status the but current is osrcin———— — 548 $ 360 — 2,309 1 were 3,338 loan impaired 5 1 an of — definition 11 — Company’s $ the meeting 169 loans — 2015, 2,869 and — 2016 31, December 2 14 At — value present the on — based value fair at recorded are they as loans, non-accrual interest. accruing from still excluded are are — that loans delinquent PCI more or days $1,032 90 240 due past loans no — has 2,226 Company The 1 3,378 2 2 248 — 15 $ consumer 63 and mortgage Residential 286 1 5,721 Construction 1 23 1 industrial and Commercial estate real Commercial as Multi-family classified and delinquent days 30-89 also were which loans TDR presents table following The consumer and mortgage Residential Construction industrial and Commercial estate real Commercial Multi-family status payment whose loans (“TDR”) restructured debt troubled are above table non-accrual the in Included NETR ACR,IC N SUBSIDIARIES AND INC. BANCORP, INVESTORS oe oCnoiae iaca Statements Financial Consolidated to Notes 109 floans of # floans of # eebr3,2016 31, December eebr3,2016 31, December Dlasi thousands) in (Dollars Dlasi thousands) in (Dollars Amount Amount floans of # floans of # eebr3,2015 31, December eebr3,2015 31, December Amount Amount

FORM 10-K Income Interest Recognized Average Recorded Investment Related Allowance (In thousands) December 31, 2016 Unpaid Balance Principal Recorded Investment 110 Notes to Consolidated Financial Statements INVESTORS BANCORP, INC. AND SUBSIDIARIES Total commercial loansTotal impaired loans 9,580 13,485 $34,404 — 42,432 1,601 9,995 33,583 490 1,452 Total commercial loans — — — — — Total commercial loans 9,580 13,485 — 9,995 490 The following tables present loans individually evaluated for impairment by portfolio segment as of Residential mortgage and consumer 24,824 28,947 1,601 23,588 962 Residential mortgage and consumerTotal: Multi-familyCommercial real estateCommercial and industrialConstruction 13,794 14,382 1,601 13,689 479 3,370 5,962 3,972 9,265 248 — — 248 — 3,953 5,790 — — 169 301 252 — 20 — — With no related allowance: Multi-familyCommercial real estateCommercial and industrialConstructionResidential mortgage and consumerWith an allowance recorded: Multi-familyCommercial real estateCommercial and industrialConstruction 3,370 11,030 5,962 14,565 $ 3,972 9,265 248 — — — 248 — 9,899 3,953 5,790 — — — — 483 169 301 252 — — — — 20 — — — — — — — — — — — — — — — — — December 31, 2016 and December 31, 2015:

FORM 10-K efrac gnrlysxcneuiemnh fpyet)adbt rnia n neetaedeemed are interest repayment and of principal period a both sustained or and a loan, been payments) the has of of there 226 term months until the status consecutive accrued commercial accrual of or collectible. modifying six non principal when extension (generally of support on an guarantor forgiveness remain performance or rate, the collateral loans in market additional 4,288 Restructured result obtain a rarely loans. frequently 119 below we modifications addition, These rate In methods. interest. interest two these in of — reduction combination a — either 2,872 through 394 been has TDR. concession 1,136 a 939 the a as preserve and classified 6,412 difficulties as is — — loan financial well the experiencing as — modification, is such difficulty, borrower of 7,964 19,025 financial time the the experiencing If 2,504 at be loan. made 24,035 — may the in who position customers 6,806 Company’s assist — and — 2,409 — competitive 1,782 remain 3,219 9,431 — 26,128 27,961 — Restructurings — 194 Debt Troubled 22,928 9,395 basis. 18,941 cash 476 a on recognized income 226 interest date — to year — the 4,389 — is recognized income interest 16,424 The 4,288 — 2,409 119 1,782 — 4,271 463 200 13,695 — — 2,872 14,908 4,240 consumer 1,136 and mortgage Residential 6,412 7,611 3,575 — 19,025 2,504 Construction industrial — and — Commercial 6,806 — estate real Commercial 12,433 Multi-family 3,219 5,160 $ 27,961 Total: 8,020 5,155 consumer 18,941 and mortgage Residential Construction industrial and Commercial estate real Commercial Multi-family recorded: allowance an With consumer and mortgage Residential Construction industrial and Commercial estate real Commercial Multi-family allowance: related no With usatal l forTRla oiiain nov oeigtemnhypyet nsc loans such on payments monthly 2,814 the lowering involve modifications loan 58,184 TDR our of 1,875 all Substantially 4,191 to loan borrower’s 34,149 a of 76,738 terms contractual the modify 2,409 to $56,987 agree may Company the basis, 50,610 case-by-case a 194 On 34,059 4,389 balances. quarterly ending the upon based calculated average 2,409 annual the is investment recorded average The 4,271 4,240 1,681 loans impaired Total 29,760 loans commercial Total — 46,339 29,819 loans commercial Total loans commercial Total NETR ACR,IC N SUBSIDIARIES AND INC. BANCORP, INVESTORS oe oCnoiae iaca Statements Financial Consolidated to Notes 111 Investment Recorded Principal Balance Unpaid eebr3,2015 31, December I thousands) (In Allowance Related Investment Recorded Average Recognized Interest Income

FORM 10-K Post- Amount Amount Recorded Investment modification Total Total # of loans # of loans 2015 Pre- Recorded Investment modification Amount Amount Loans Number of Non-accrual Non-accrual December 31, 2016 December 31, 2015 (Dollars in thousands) # of loans # of loans (Dollars in thousands) Post- (Dollars in thousands) Recorded Investment Years Ended December 31, modification Amount Amount Accrual Accrual 2016 Pre- 112 # of loans Recorded # of loans Investment modification Loans Number of Notes to Consolidated Financial Statements INVESTORS BANCORP, INC. AND SUBSIDIARIES Multi-familyCommercial real estateConstructionCommercial and industrialResidential mortgage 6 — — 27 1,289 — $ — — 1,289 4,538 $ — — — 4,538 4 2 19 — 1 824 $1,115 2,246 3,413 2 824 $1,115 2,246 3,413 1,508 1,508 The following table presents information about troubled debt restructurings that occurred during the years Total commercial loansTotal 7 14,114 16 10,397 39 23 $22,489 24,511 65 $24,950 104 $47,439 Total commercial loansTotal 2 352 7 42 5,176 $9,445 9 68 5,528 $20,907 110 $30,352 The following table presents the total TDR loans at December 31, 2016 and December 31, 2015. There were Troubled Debt Restructings: ended December 31, 2016 and 2015: Residential mortgage and consumer 32 8,375 49 14,553 81 22,928 Commercial loans: Multi-familyCommercial real estateCommercial and industrialConstruction 1 5 — 13,161 640 $ 9 — 1 3 2 5,826 2,586 313 $ 14 1,580 4 2 18,987 2 3,226 $ 1,580 405 3 718 Residential mortgage and consumer 40 9,093 61 15,731 101 24,824 Commercial loans: Multi-familyCommercial real estateCommercial and industrialConstruction — 2 — — 352 $ — — 2 4 1 1,688 3,240 — $ 248 — 2 6 1 1,688 3,592 — $ 248 — — three residential PCI loans2016. that There were were classified three2015. residential as PCI TDRs loans and that are were included classified in as the TDRs table for below the at period December ended 31, December 31,

FORM 10-K eieta on hc eutdi 45mlincag f eoddtruhtealwne nadto,the addition, In allowance. $611,000. of the sale through on gain recorded a off in resulting charge loans million residential performing $4.5 of a million $347.3 in sold Company resulted which loans residential $600,000. approximately of gain net a in resulting loans 31, commercial December ended to Sales 5 months Loan prior twelve the full the $225,000. of in in of Of investment TDR paid investment recorded a 2016. were a recorded as with 4 31, loan a modified above, construction loans with 1 described December for of loan defaults consisted defaults at 2015 payment construction Payment with 2016. respectively, 1 construction) 31, and $132,000, December and loans estate and estate real $573,000 (commercial real commercial million, 4 $1.8 loans, residential 11 Restructurings: Debt Troubled 2015: and 2016 31, December credit; ended years of the during line occurred which capital restructurings working existing an period. an extended time had same Company Company the the during the 2016, repaid TDR which 31, subsequently was a December for loan as ended that qualified year loan however, which the interest commercial During modifications which in extended. loan terms TDR reduction modified being Commercial existing a their maturity future. in reflect of the rates terms to in interest of yield modified up comprised average were step weighted include TDRs TDRs their be residential impact to Several will and deemed rates. market loans million current residential to $1.6 All rates dates. totaled The maturity tables loan TDRs. above of dependent the collateral in respectively. for 2015, presented and charges-offs TDRs 2016 no 31, the the December were at 2016. of with periods 31, there value the associated December for fair 2015 ended million losses estimated $1.8 year 31, loan the the December during for to TDRs ended down allowance dependent year written collateral the were for charge-offs TDRs During no as were classified There loans collateral. impaired dependent Collateral osrcin—— %249%4.97% PCI and non-performing of million 4.97% 3.88% $20.9 3.40% sold Company 6.24% the 2015, 3.88% 31, loans 4.84% December residential 2 5.35% performing ended 6.24% of year million the $9.7 For sold Company 1 4.53% the 19 —% 2016, 31, 2 December ended year 3.61% the —% For 4 —% —% 6.18% —% 5.20% —% — 27 5.11% of consisted — 2016 31, December ended months 6 — twelve the in TDR a as modified loans for defaults Payment mortgage Residential industrial and Commercial Construction estate real Commercial Multi-family debt troubled for yield interest modification post and pre about information presents table following The extension and rate interest loan in reduction the involved primarily modifications loan mortgage Residential above. discussed as impairment, for evaluated individually are which loans, impaired are TDRs All modification. following immediately balance book net the represents investment recorded Post-modification NETR ACR,IC N SUBSIDIARIES AND INC. BANCORP, INVESTORS oe oCnoiae iaca Statements Financial Consolidated to Notes ubrof Number Loans 113 modification Interest Yield Pre- 2016 er ne eebr31, December Ended Years modification Interest Yield Post- ubrof Number Loans modification Interest Yield Pre- 2015 modification Interest Yield Post-

FORM 10-K Assets Net Intangible 2015 2015 Valuation Allowance December 31, December 31, (In thousands) (In thousands) 2016 2016 295,510 277,470 $177,417 172,519 (In thousands) Accumulated Amortization 114 Asset Gross Intangible Notes to Consolidated Financial Statements INVESTORS BANCORP, INC. AND SUBSIDIARIES Total other intangible assetsGoodwill and intangible assets 24,268 $101,839 27,740 105,311 Mortgage servicing rightsCore deposit premiumsOtherGoodwill $ 14,889 16,248 8,451 11,332 928 77,571 77,571 160 LandOffice buildingsLeasehold improvementsFurniture, fixtures and equipmentConstruction in processLess accumulated depreciation and amortization 118,093 104,951 83,246 95,489 77,096 79,898 83,699 13,070 87,832 $ 20,006 12,075 20,569 Total other intangible assets $48,769 (20,908) (121) 27,740 Total other intangible assetsDecember 31, 2015 Mortgage Servicing RightsCore Deposit PremiumsOther $50,548 $23,411 (26,115) 25,058 (165) (7,042) (13,726) 24,268 (121) — 16,248 300 11,332 (140) — 160 The following table summarizes other intangible assets as of December 31, 2016 and December 31, 2015: December 31, 2016 Mortgage Servicing RightsCore Deposit PremiumsOther $24,340 25,058 (9,286) (16,607) (165) — 14,889 1,150 8,451 (222) — 928 Depreciation and amortization expense for the years ended December 31, 2016,The 2015 following table and summarizes net 2014 intangible assets was and goodwill at December 31, 2016 and 2015: Office properties and equipment are summarized as follows: $16.2 million, $13.9 million and $13.2 million, respectively. 6. Goodwill and Other Intangible Assets 5. Office Properties and Equipment, Net

FORM 10-K aig .9 ,9,8 37%02%2100415.29% 2,150,004 100.00% 0.29% 24.29% $14,063,656 0.56% 13.70% 3,416,310 100.00% 19.52% 27.46% 2,092,989 1.14% $15,280,833 13.44% 2,745,489 0.51% 3,861,317 0.29% 19.29% 1,890,536 0.29% 0.67% $ 2,947,560 of —% 25.63% certificates and 27.16% brokers. through brokers obtained through respectively, obtained 0.91% million, respectively, $417.4 and million, 3,916,208 14.22% million $614.2 4,150,583 $687.8 and of million deposits $736.8 of deposits 0.45% market 2,173,493 0.65% $ —% Deposits Total deposit of Certificates Savings deposits market Money accounts Checking Interest-bearing: accounts Checking bearing: Non-interest Deposits 7. years: years. 10 of period a amortization considering flows 9.84% cash of future mortgages on expected rate on years. prepayment based 6.8 constant 2015 respectively. of servicing average was million, life 31, weighted the average value $16.2 a weighted December 2015, and fair 14.27%, a million and and and of an 2016, $14.9 2016 rate 31, 2016 had of discount 31, value December basis 31, average December fair weighted ending this December At estimated period on an loans. at servicing the had sold mortgage billion assets, net For were residential intangible $2.12 estimated to that in of, and included relate Loans period asset, which billion basis. the of $1.98 servicing-retained over all of a and respectively, balance on to, loans principal proportion sells in unpaid Company asset The servicing loan revenues. the amortizes Company nlddi h bv aacsfrteyaseddDcme 1 06adDcme 1 05aemoney are 2015 31, December and 2016 31, December ended years the for balances above the in Included follows: as summarized are Deposits five next the average for assets weighted intangible other a of expense having amortization future and estimated the method presents following The accelerated an using amortized are premiums deposit Core the method, this Under method. amortization the using for accounted are rights servicing Mortgage 01517667 87 87 87 756 1,112 $87 1,521 1,974 $2,427 541 524 508 491 $461 2021 2020 2019 2018 2017 NETR ACR,IC N SUBSIDIARIES AND INC. BANCORP, INVESTORS oe oCnoiae iaca Statements Financial Consolidated to Notes Weighted Average Rate otaeServicing Mortgage Amount 115 2016 Rights fTotal of % I thousands) (In eebr31, December I thousands) (In oeDpstPremiums Deposit Core Weighted Average Rate Amount 2015 Other fTotal of %

FORM 10-K 2014 Rate Average Weighted 2015 2015 2015 (In thousands) Principal 2016 December 31, (In thousands) For the Years Ended December 31, December 31, 2016 (Dollars in thousands) Rate Average $2,947,560 3,416,310 Weighted 2016 Principal 116 Notes to Consolidated Financial Statements INVESTORS BANCORP, INC. AND SUBSIDIARIES agreements 154,831 2.19% 156,307 2.21% Total funds borrowed under repurchase Total borrowed funds $4,546,251 1.81% $3,263,090 2.13% Within one yearOne to two yearsTwo to three yearsThree to four yearsAfter four years $1,866,000 2,586,076 674,552 237,506 62,500 496,288 167,028 107,002 57,443 109,475 FHLBOther brokersFHLB advances 131,202 $ 23,629 1.88% 4,391,420 3.90% 131,924 $ 1.79% 24,383 1.89% 3,106,783 3.90% 2.12% Funds borrowed under repurchase agreements: Other borrowed funds: TotalBorrowed funds are summarized as follows: $82,057 71,414 59,206 Checking accountsMoney market depositsSavingsCertificates of deposit $16,268 25,621 24,136 9,642 33,864 13,664 8,755 31,234 30,148 6,304 6,402 6,639 The aggregate amount of certificates ofInterest deposit expense on deposits in consists of denominations the following: of $100,000 or more totaled Scheduled maturities of certificates of deposit are as follows: 8. Borrowed Funds approximately $1.94 billion and $2.10 billion at December 31, 2016 and December 31, 2015, respectively.

FORM 10-K usadn orwnso 44 ilo n usadn etr fcei f$.2blin nadto,teBank the million, $325 addition, 2016. totaling 31, In December institutions billion. at financial $2.92 outstanding other was of with balance Funds) credit no (Fed of which borrowings of letters overnight was outstanding unsecured to and 2014 access billion had and $4.41 of 2015 borrowings outstanding 2016, 2.25% 2.16%, 31, was rate December interest average ended the and years respectively, million, the respectively. $192.9 2.02%, and and during amount million average The $159.4 outstanding respectively. million, million, $153.0 agreements $261.2 and repurchase million $163.0 of million, $153.0 was agreements repurchase follows: as Company. are loans the repurchase mortgage by to held agreements Whole are securities. but advances, identical for the collateral benefit as of the FHLB repurchase for the FHLB to require the pledged agreements by been held have Repurchase are Company. agreements, repurchase the to of subject sold, securities Mortgage-backed brokers. tDcme 1 06 u orwn aaiya h HBws$02 ilo,o hc h opn had Company the which of billion, $10.25 was FHLB the at capacity borrowing our 2016, 31, December At the of balance month-end maximum the 2014, and 2015 2016, 31, December ended years the During 2.30% 1.99% 531,001 1.78% 650,000 2.13% 1.84% 3.00% 469,782 2.01% 862,924 1.99% 705,853 249,383 under 1.96% sold securities 600,000 for 500,000 1.80% collateral 2.12% as $ used 775,000 securities underlying the 1.26% 619,567 of 862,202 value fair and cost amortized 983,629 The various $ and FHLB the to agreements, repurchase to subject sold, been have securities Mortgage-backed years five After years five to Four years four to Three years three to Two years two to One year one Within follows: as maturities scheduled had funds Borrowed oa orwdfns$,4,5 .1 323002.13% $3,263,090 1.81% $4,546,251 funds borrowed Total arvleo collateral: of value Fair collateral: of cost Amortized oa arvleo oltrl$6,0 481,401 $469,200 481,401 $469,200 475,984 475,984 $468,159 $468,159 collateral of value fair Total securities Mortgage-backed collateral of cost amortized Total securities Mortgage-backed NETR ACR,IC N SUBSIDIARIES AND INC. BANCORP, INVESTORS oe oCnoiae iaca Statements Financial Consolidated to Notes 117 Principal 2016 Weighted Average Dlasi thousands) in (Dollars Rate eebr31, December Dlasi thousands) in (Dollars 2016 eebr31, December Principal 2015 2015 Weighted Average Rate

FORM 10-K 2014 2014 2015 (In thousands) 2015 Years Ended December 31, (In thousands) 2016 Years Ended December 31, 2016 95,307 102,552 84,537 11,640 (3,180) (9,786) 118 Notes to Consolidated Financial Statements INVESTORS BANCORP, INC. AND SUBSIDIARIES FederalStateFederalState $ 82,708 87,748 12,599 77,029 14,804 8,107 7,508 3,533 4,310 (3,846) (7,490) (5,940) Total income tax expense $106,947 99,372 74,751 Total income tax expense $106,947 99,372 74,751 Deferred tax expense (benefit): Current tax expense: “Expected” federal income tax expenseState tax, netBank owned life insuranceExcess tax benefits from employeeAcquisition share-based related payments net operating lossESOP fair market value adjustmentNon-deductible compensationExpiration of stock optionsOther (7,735) $104,675 — 98,307 72,265 — — (1,548) (1,382) 931 (4,076) (1,628) 1,602 — 947 9,887 276 4,753 349 — 3,334 1,019 19 2 (865) 528 (590) The following table presents the reconciliation between the actual income tax expense and the “expected” The components of income tax expense are as follows: amount computed using the applicable statutory federal income tax rate of 35%: 9. Income Taxes

FORM 10-K tt a eei eae otecnrbto hti o oelkl hnntt eraie.A eebr3,2016 31, December million At realized. $10.0 be to $346,000. remaining not at the than remained of The contributions likely portion charitable more the income. the not for to is 2014 the pertaining taxable that 31, at allowance December contribution income valuation future of the taxable Company’s as the to state Bank’s established future related was is standalone benefit the $346,000 and the tax of on level, state on allowance based Bank valuation and the a based Inc., at level, Bancorp, cash Bancorp realized Investors in by made made fully was was contribution contribution be the of to million $10.0 expected Foundation. Charitable Investors which to benefits tax temporary those for which recorded realized. in be is to periods not allowance tax the than deferred valuation likely during that, the more A income benefits of not are realization tax taxable deductible. determined ultimate any future has become The management of of realized. carryforwards amount generation be and the to the not by differences upon than reduced dependent likely is is more assets are asset tax evidence, deferred available on of based measurement The carryforwards. and follows: ncneto ihteCmaysscn tpcneso,a$00mlincaial otiuinwsmade was contribution charitable million $20.0 a conversion, step second Company’s the with connection In differences temporary to attributable effects tax future estimated the for recognized is asset tax deferred A as are liability and asset tax deferred the comprise which carryforwards loss and differences temporary The eerdtxasset: tax Deferred eerdtxliability: tax Deferred te ,0 1,409 1,305 45 — 3,695 7,127 4,333 9,599 5,823 406 13,071 2,262 88,894 14,539 1,417 10,420 31,986 36,372 92,738 1,587 17,078 20,823 1,596 34,218 $ 42,085 Other 40,228 assets Intangible costs origination Loan carryforward contribution acquisitions Charitable to related adjustments value Fair interest delinquent for Allowance securities on loss ESOP impairment temporary than other Net securities on loss unrealized Net losses loan for Allowance equipment and Premises compensation Deferred benefits Employee nagbeast 6 — — 6,893 363 4,080 6,257 — 5,127 activities hedging on gain unrealized Net rights servicing Mortgage accretion Discount assets Intangible e eerdtxast$2,7 237,367 $222,277 6,893 15,827 (346) (346) 244,606 238,450 asset tax deferred Net liability tax deferred Gross allowance Valuation asset tax deferred Gross NETR ACR,IC N SUBSIDIARIES AND INC. BANCORP, INVESTORS oe oCnoiae iaca Statements Financial Consolidated to Notes 119 3,0 244,260 238,104 2016 I thousands) (In eebr31, December 2015

FORM 10-K 120 Notes to Consolidated Financial Statements INVESTORS BANCORP, INC. AND SUBSIDIARIES Based upon projections of future taxable income andRetained earnings the at December ability 31, to 2016 included carry approximately back $45.2 million losses for for which deferred two income years, The Company had no unrecognized tax benefits or related interest orThe penalties Company at files December income 31, 2016 tax and returns in the United States federal jurisdiction and in the states of New The Company participates in the Pentegra Defined Benefit Plan for Financial Institutions (“Pentegra DB The Pentegra DB Plan is a single plan under Internal Revenue Code Section 413(c) and,The as funded a result, status all (fair of value of plan assets divided by funding target) asThe of Company’s July required 1, contribution and 2016 pension and cost 2015 was was $4.2 million, $6.4 million and $5.3 million in As of December 31, 2016 the annual benefit provided under the Pentegra DB plan has been amended to management believes it is more likely than not the Company will realize the remaining deferredtaxes tax of asset. approximately $19.0year million have allocation not of beenrecapture provided. income if The the to retained earnings Bankexcess bad amount makes of debt represents tax certain earnings the non-dividend deductions and base a distributions, profits, for permanent or repurchases difference ceases tax any and to deferred of purposestaxable maintain taxes a its income are only. bank in stock, not charter. recognized the Base pays Under unlessqualify foreseeable dividends ASC it year as future. 740, appears in a Events this reserves that bank amount that it for is are will would tax treated be purposes result subject as reduced or in and distributions taxation to result in of in complete these or reserves partial liquidation. include failure2015. to Jersey and Newexamination York. for As years prior ofState to December 2013. Department Investors of 31, Bank Taxation 2016,income and and tax its the examination Finance affiliates by Company for are New currently Jersey is tax and under years no New audit York 2013 by longer for and the years subject 2014. New prior to York to10. The 2012 Benefit Company federal and Plans 2013, is income respectively. no tax longer subjectDefined Benefit to Pension Plan Plan”), a tax-qualified defined-benefit pension13-5645888 plan. and The Pentegra the DBaccounting Plan’s purposes Plan Employer and Identification Number as Number1974 is a is and multiple-employer 333. the plancontributions The under to Internal the the Pentegra Pentegra Revenue Employee DB Plan. DB Code. Retirement Income There Plan Security are operates Act of no as collective athe bargaining multi-employer assets agreements stand plan behind inparticipating all for employer place may of be the that used liabilities. to require provide Accordingly, benefits under to the participants of Pentegra other DB participating Plan employers. contributions94.92% made and by 99.17%, a June respectively. 30, 2016. The fair value of plan assets reflectsthe any years contributions ended December receivedand 31, $727,000 through 2016, at 2015 DecemberPlan and 31, 2014, are 2016 respectively. and not Thecontribution 2015, for accrued more respectively. the pension The 2017 than liability year Company’s is 5% was contributions approximately $780,000 to of $3.8 million. the the Pentegra total DB contributionsfreeze to the the plan. Pentegrabenefit Freezing will DB the be determined Plan. plan as of eliminates The December all 31, Company’s 2016 future and expected no benefit further benefits accruals will and accrue beyond each such participants date. frozen accrued

FORM 10-K h ln h aeRpaeetPa,Splmna SPadteDrcos lnaeufne n h ot of costs the in provided. and participate are unfunded to services are that on eligible Plan period were frozen Directors’ the directors was the over new and plan recognized no ESOP are This and Supplemental plans Plan plan. under, Plan, the Replacement accrued benefit Retirement Wage benefits defined Director by The new nonqualified, plan. Restated limited no the a that and are such is contributions Amended 2006 which whose the 21, ESOP directors, maintains November the certain also and for Company Plan Plan”) The DB (“Directors’ Code. Pentegra and Revenue the in Internal through participating the Directors) employed of Board continuously the remained 2016, 31, would participants December participants of the as the service that provided of such years vested period 2016 2017. their two-year 31, 100% to a December attributable including over become benefits vest attributable accrued will their to attributable of payable service which 50% benefits of to the year right structure a 2016 have participants, participants’ certain the for to and, solely accruals benefits benefit the future of cease benefit sum defined the the under by payable Wage benefits reduced 36-month their annual the employment) of consecutive an value a of ESOP. specifically, annualized to Supplemental (over the months the More equal incentive and of calendar Plan cash portion benefit DB Directors. and consecutive Pentagra retirement salary the 120 of normal base under last provided annual a Board the highest with the participant’s within participants the period of of provide 60% to Committee executives of certain designed benefit Compensation to “SERPs”). was benefits the provides the Plan which (collectively, plan Replacement by ESOP”) benefit defined (“Supplemental designated nonqualified, Plan a as is Retirement Plan and Replacement ESOP Wage The Supplemental the and Plan”) Plan Benefits Postretirement Other and Plan Directors’ SERPs, h olwn al esfrhifrainrgrigteWg elcmn lnadteDrcos Plan: Directors’ the and Plan Replacement Wage the regarding information forth sets table following The of Committee Compensation the by designated (as executives certain compensates ESOP Supplemental The to amended, was Plan Replacement Wage the 2016, 31, December of business of close the of as Effective Replacement (“Wage Plan Replacement Wage Retirement Supplemental Executive an has Company The uddsau (026 (47,887) $(40,296) status Funded obligation: benefit in Change eeispi 81 (871) — — (871) — (4,294) (27) (233) 1,497 3,096 1,895 2,088 6,008 (1,587) (6,716) (778) 1,035 (468) 40,522 paid Benefits Curtailment 47,887 $ gain Actuarial changes Settlements demographic to rate due discount loss in (Gain) change to due assumption (gain) mortality Loss in change to due Gain cost Interest cost year Service of beginning at obligation Benefit eei biaina n fya 02647,887 40,296 year of end at obligation Benefit NETR ACR,IC N SUBSIDIARIES AND INC. BANCORP, INVESTORS oe oCnoiae iaca Statements Financial Consolidated to Notes 121 2016 I thousands) (In eebr31, December 2015

FORM 10-K 2014 2015 2015 2015 2014 December 31, 2016 (In thousands) December 31, (In thousands) 2016 2016 Years Ended December 31, 2015 Years Ended December 31, 2016 122 Notes to Consolidated Financial Statements INVESTORS BANCORP, INC. AND SUBSIDIARIES comprehensive income $6,759 19,284 Total net periodic benefit costDiscount rateRate of compensation increase $6,038 5,924 4,372 4.36% 4.19% 4.00% 3.99% 3.71% 4.53% Total amounts recognized in accumulated other Discount rateRate of compensation increasePrior service costNet loss —% 4.36% 3.80% 3.99% — 49 2,055 1,282 98 633 Prior service costNet actuarial gain $ — 6,759 19,284 — Service costInterest costAmortization of: $2,088 3,096 1,895 2,319 1,497 1,322 The following are the weighted average assumptions used to determine net periodic benefit cost: The components of net periodic benefit cost are as follows: The accumulated benefit obligation for the Wage Replacement Plan and Directors’ Plan was $33.5 million The weighted-average actuarial assumptions used in the plan determinations at December 31, 2016 and The unfunded pension benefits of $40.3 million and $47.9 million at December 31, 2016 and 2015, and $28.6 millionReplacement Plan and at Directors’ Plan December is December 31, 31 for the 2016 years ended and December 31, 2015, 2016 and 2015. respectively.2015 were The as follows: measurement date for our Wage respectively, are included inother other liabilities comprehensive in loss thesummarized consolidated related in balance the to sheets. following The pension table. components plans, of accumulated on a pre-tax basis, at December 31, 2016 and 2015, are

FORM 10-K n.21 qiyIcniePa “05Pa” hc rvdsfrteisac rdlvr fu o30,881,296 to up of delivery or stock. common issuance Inc. the Bancorp, Investors for of options) provides stock which 17,646,455 and Plan”) awards (“2015 stock restricted Plan (13,234,841 shares Incentive Equity 2015 Inc. otmltdb SPsbnftfruadet h nenlRvneCd.Drn h er ended years the During benefits Code. full Revenue Plan the $656,000 Incentive $766,000, Equity Internal receiving to amounted the from plan this prevented to to related are due expense compensation respectively. who 2014, $568,000, formula and and Directors 2015 benefit 2016, of 31, ESOP’s December Board shares by the of contemplated of value fair Committee the Compensation representing 2015 2016, respectively, 31, million, December $5.1 year. ended and the and years during 2016, the released million 31, be for December $5.5 to expense at committed million, compensation or 12,789,847 $5.4 allocated ESOP totaled million. was released be $178.4 2014 to of and committed value yet fair not a or had unallocated made. were are principal that payments collateral loan loan shares as as outstanding participants pledged to stock The allocation common for shares. Company’s pro-rata the pledge additional of the the from Shares released the million. million an purchase are from $92.8 $33.9 loan purchased loan to was of the a connection ESOP 2016 for balance million of In 31, interest the proceeds ESOP. $66.2 December and 2014, the at the principal with additional 7, balance outstanding to share an the May per Company refinanced $10.00 on borrowed the Company of from conversion and The price loan ESOP. stock a common a the at to Company’s to stock of the mutual Company of proceeds October of shares Company’s the in common shares the with offering 6,617,421 10,847,883 share of additional stock purchase, per completion public did $3.92 initial the and of primarily Company’s with purchase, price based the a to Bank, During at the authorized stock. from stock was common benefit ESOP Company’s retirement the the funded 2005, a of receive value to the opportunity on the with employees provides 2015 2016, Plan 31, Ownership 401(k) December Stock the ended Employee to respectively. years participants million, the $2.0 the for and by plan million contributed $2.2 401(k) 6% million, the $2.6 first to were the 2014 contributions of and aggregate 50% matches Company’s Company The The plan. 21. age of requirement Plan 401(k) follows: as are years calendar tteana etn edo ue9 05 tchleso h opn prvdteIvsosBancorp, Investors the approved Company the of stockholders 2015, 9, June on held meeting annual the At the by designated as executives certain to benefits supplemental provides also ESOP Supplemental The ESOP inception. plan the since 4,675,456 were participants to allocated shares 2016, 31, December At that stock common Company’s the in primarily invest to designed plan tax-qualified a is ESOP The age eligibility the meet they provided employees all substantially covering plan 401(k) a has Company The ten next the for appropriate as service, future expected reflect which payments, benefit future Estimated 012,728 2,092 899 921 14,146 942 $ 2026 through 2022 2021 2020 2019 2018 2017 NETR ACR,IC N SUBSIDIARIES AND INC. BANCORP, INVESTORS oe oCnoiae iaca Statements Financial Consolidated to Notes 123 I thousands) (In Amount

FORM 10-K Year ended December 31, 2015 Year ended December 31, 2016 124 Notes to Consolidated Financial Statements INVESTORS BANCORP, INC. AND SUBSIDIARIES granted $ 2.80 $ 3.12 Weighted average expected life (inWeighted years) average risk-free rate ofWeighted return average volatilityDividend yieldWeighted average fair value of options 7.00Total stock options granted 1.67% 24.05% 7.43 1.96% 201,440 25.33% 1.93% 11,576,611 1.59% The weighted average expected life of the stock option represents the period of time that stock options are Restricted shares granted under the 2015 Plan vest in equal installments, over the service period generally Stock options granted under the 2015 Plan vest in equal installments, over the service period generally During the year ended December 31, 2015, the Compensation and Benefits Committee approved the The fair value of stock options granted as part of the 2015 Plan was estimated utilizing the Black-Scholes expected to be outstandingrisk-free and interest is rate estimatedvolatility using is is historical based based data on of onexpense the stock the for the U.S. option historical fair exercises Treasury volatility valuesservice and of yield of period forfeitures. these the of curve The awards, the Company’s in which awards.the stock. have source Upon effect graded The for exercise at vesting, shares. Company of on the vested recognizes a options, time compensation straight-line management basis of expects over to grant. the draw requisite The on treasury expected stock as ranging from 5awarded to are 7 performance years vestingcorporate awards, beginning financial which one may targets. year or The2015 may from vesting not Plan. of the vest The restricted date dependingCompany’s stock upon of product common the may grant. of attainment stock acceleraterecognizes Additionally, of in the determine compensation certain certain accordance expense number the restricted for withservice the fair of the shares fair period. terms value shares value For of of the of grantedawards restricted the year under restricted shares ended and the on December 2015 shares a the Plan. 31, straight-line under 2016, grant basis the the over Company date the 2015 granted requisite closing 276,890 Plan. shares market Management of price restrictedranging from stock of 5 to the 7in years accordance beginning with one the yearvalue terms from the of of date the of the 2015 grant.expiration Plan. Company’s The period Stock vesting common options of of stock wereoptions stock 10 options granted under may the on at years. accelerate 2015 an For Plan. the exercise the price grant equal year date to ended the based December fair on 31, theissuance 2016, of closing the 6,849,832 restricted market Company stockBancorp, price granted awards Inc. and 201,440 2015 and 11,576,611 Plan. stock stock have During optionsapproved to the the an certain year issuance officers ended of under DecemberInvestors 38,250 the 31, Bancorp, Investors restricted Inc. 2014, 2006 stock the Equity awards Compensation Incentive and and Plan Benefits 144,177 (the Committee “2006 stock Plan”). options to certain officersoption under pricing the model using the following assumptions for the period presented below:

FORM 10-K xrial tDcme 1 0637594$97 . $15,631 6.2 $29,101 8.2 9.77 $ 3,735,974 $11.74 $46,996 13,165,333 non-vested the to relating 6.8 years. expense 4.86 of future period Expected average weighted a over respectively. million $26.4 share, is 2016 $10.00 per 31, December $3.12 of and as outstanding 18,804,816 $2.80 options was 2015 and 2016 31, December at Exercisable 2016 31, December at Outstanding 2015 31, December at Outstanding 2016: 31, December ended year the for plan years. 4.82 of period average weighted a over million $64.2 ended: then year the during therein changes expenses applicable all and awards outstanding stock 2014, 7, restricted May and period. on the MHC options during Bancorp, stock recognized Investors were of both conversion for mutual-to-stock accelerated the of vesting completion Upon 2014. and 2015 xie 12 8.08 (102) 9.7 0.3 12.54 11.76 (125,931) 6.00 201,440 (5,714,890) 2016 31, December ended years the during granted options of value fair date grant average weighted The Expired Forfeited Exercised Granted option its for information related and activity option stock Company’s the of summary a is following The is 2016 31, December of as outstanding shares restricted non-vested the to relating expenses future Expected and 2016 31, December of as shares restricted Company’s the of status the of summary a is following The 2016 31, December ended years the for expense compensation based share the presents table following The tc pinepne$6562951,800 11,901 2,905 6,315 6,556 15,419 $ 13,701 9,220 $21,975 expense compensation based share Total expense stock Restricted expense option Stock o-etda eebr3,21 ,7,9 $12.51 5,876,491 $12.64 6,759,832 2016 31, December at Non-vested 2015 31, December at Non-vested ofie 1025 12.03 12.54 11.69 (100,205) (1,060,026) 276,890 Forfeited Vested Granted NETR ACR,IC N SUBSIDIARIES AND INC. BANCORP, INVESTORS oe oCnoiae iaca Statements Financial Consolidated to Notes 125 ubrof Number Options Stock ubrof Number Awarded Shares 2016 er ne eebr31, December Ended Years Weighted Dlasi thousands) in (Dollars Exercise Average Price 2015 rn Date Grant arValue Fair Weighted Average ie(nyears) (in Life Contractual Remaining Weighted Average 2014 Aggregate Intrinsic Value

FORM 10-K Amount $238,028 (In thousands) 126 Notes to Consolidated Financial Statements INVESTORS BANCORP, INC. AND SUBSIDIARIES 20172018201920202021Thereafter $ 23,004 23,367 22,554 128,666 20,970 19,467 The Company is a party to transactions with off-balance-sheet risk in the normal course of business in order At December 31, 2016, the Company had commitments to originate total commercial loansThe of Company uses the same credit policies and collateral requirements in making commitments and The Company is a defendant in certain claims and legal actions arising in the ordinary courseAt of business. December 31, 2016, the Company was obligated under various non-cancelable operating leases on The projected annual minimum rental commitments are as follows: Financial Transactions with Off-Balance-Sheet Risk and Concentrations of Credit Risk to meet the financingtransactions needs of involve, its to customers.recognized These varying in transactions the consist degrees, accompanying of consolidated elements balance commitments sheet. to of extend credit credit. These and interest rate risk$451.2 million. in Additionally, excess$113.9 the of million, Company the had commitments amounts overdraft commitments to lines to of purchase credit, originateNo residential and residential commitments undisbursed loans loans business are of and ofexposure included to construction $151.6 approximately credit in loans, million loss totaling the if and approximately the accompanying customer $1.07 unused does consolidated billion. not home financial exercise its equity statements. rights to and The borrow under Company the hasconditional commitment. obligations no as itlend does to for customers on-balance-sheetgenerally as loans. have long Commitments fixed as to expiration therecommitments extend dates may is credit or expire no are other without violation beingfuture termination agreements drawn cash clauses of to upon, requirements. and any the The may total Company conditionamount require evaluates commitment established each of amounts payment in customer’s do of collateral creditworthiness not the amanagement’s on necessarily obtained fee. contract. a represent credit case-by-case Since Commitments if basis. the evaluationproperties. The deemed of necessary the by the borrower. Company Collateral upon held extension varies of but credit primarily is includes based residential on 11. Commitments and Contingencies Management and the Company’swill legal not have counsel a are material of adverse effect the on opinion the that Company’s financial the condition, ultimate results disposition of operations of or thesebuildings liquidity. and matters land used forwhich office provide space for and increased bankingindices. purposes. rental These expense, Rental operating based leases$17.3 primarily expense contain million escalation on for clauses increases the under years in ended these real December 31, estate 2016, leases taxes 2015 and and aggregated 2014, cost-of-living respectively. approximately $22.3 million, $19.2 million and

FORM 10-K h opn ol aet efr ne h urne.Ottnigsadylteso rdttotaled credit of fully letters are outstanding. and credit 2016. standby of 31, year letters December Outstanding commercial one at in immaterial $205,000 guarantee. to were had obligations up Company the these the of of 2016, under 31, values term party, December fair third at perform a The the addition, 2016. to for In to 31, performance December extend or at have payment generally million a $20.0 on would guarantees defaults The customer Company the party. if the issued, third guarantee a each For to collateralized. customer a of instruments derivative these operations. of are of values which results fair and loans The condition 2016. such financial 31, sell Company’s December fund to the at 815, to to commitments loans immaterial sell of million ASC are to amount $47.6 million like under $31.0 approximately a of of instruments commitments with commitments held-for-sale derivative as had classified Company considered be the will 2016, which ended 31, loans December year At instruments. the asset certain an with During was 2016 associated 31, borrowings. flows December cash of Company’s as in derivative variability the the of the value hedge to million. fair to $12.6 The manage of transactions. used related known to funding were its wholesale used and principally derivatives term receipts short are such cash payments expected 2016, instruments or 31, of financial known cash value December Company’s derivative the the expected amounts, of Company’s cash duration The and uncertain or timing, and rates. amount, known the interest future in of by differences payment determined or receipt are the which in in result be that to activities found business loans. is these Company of the certain repurchase that to event obligated be the may In it warranties. warranties, and and representations representations adequate these of customary that breach to and subject are risks sales such The at to loans. amortizing loans exposure risks. inherent its potential and mortgage for known the all did four-family for control it provided one-to are than adequately losses Company loan interest-only loans criteria The for interest-only provisions respectively. of these the million, these required $172.3 affect amount believes for and the could million, criteria Company This The $122.0 to increases underwriting term. was payment loan. due 2015 stricter loan 31, These payments maintained mortgage the December period. required and the repay 2016 interest-only contractually of 31, the December years to borrower’s after ten the ability amount or in principal seven borrower’s increases the five, future of first in the amortization result for will payments feature interest only makes borrower and policies required are lending guarantees its private are or believes losses government Company loan and/or for Collateral The provisions losses. loans. loss. adequate all estimable and virtually of and risks for probable Company’s such risk all to the to exposure for beyond are potential subject provided the circumstances Such the obligations therefore, by individual property. minimize the their adequately generated and is, on procedures flows conditions repay lien Company Company’s cash economic to the the worth, various abilities of control; upon net priority borrowers’ throughout and dependent and collateral Its borrowers are income underlying to proximity. factors borrowers’ the of loans the close value including other in collateral, underlying factors, and states various consumer and upon and York dependent loans New mortgage Jersey, residential New loans, construction loans, tnb etr fcei r odtoa omtet sudb h opn ogaateteperformance the guarantee to Company the by issued commitments conditional are credit of letters Standby derivative freestanding certain has Company the activities, banking mortgage its with connection In from arise that exposures manage to instruments financial derivative into entered has Company The loan These parties. third to loans mortgage residential sells Company the business of course normal the In the which in loans mortgage four-family one-to interest-only portfolio loan its in holds also Company The industrial and commercial loans, multi-family loans, estate real commercial grants principally Company The NETR ACR,IC N SUBSIDIARIES AND INC. BANCORP, INVESTORS oe oCnoiae iaca Statements Financial Consolidated to Notes 127 DrvtvsadHedging.” and “Derivatives h opn lohad also Company The

FORM 10-K Fair Value Sheet Balance At December 31, 2015 Location Other liabilities $— Fair Value Sheet Balance At December 31, 2016 Location Other liabilities $— (In thousands) Fair Value 128 Sheet Other assets $— Balance Location At December 31, 2015 Asset Derivatives Liability Derivatives Fair Value Notes to Consolidated Financial Statements INVESTORS BANCORP, INC. AND SUBSIDIARIES Sheet Other assets $12,550 Balance At December 31, 2016 Location Interest Rate Swaps The Company uses various financial instruments, including derivatives, to manage its exposure to interest The Company’s objective in using interest rate derivatives are to primarily reduce cost and add stability to During 2016, such derivatives were used to hedge the variability in cash flows associated with certain short The following table presents the fair value of the Company’s derivative financial instruments as well as their designated as hedging instruments $12,550 $— $— $— as hedging instruments: Total derivatives Derivatives designated 12. Derivatives and Hedging Activities rate risk. Certain derivatives are(fair designated value or as cash hedging flow instruments hedge.) in As a of qualifying December hedge 31, accounting 2016 relationship theCash Company Flow has Hedges cash of flow Interest hedges. Rate Risk interest expense in an effortcash to flow manage hedges its involve exposure thecounterparty to receipt in interest of exchange rate amounts for movements. subjectexchange the Interest to of rate Company variability swaps the making caused designated fixed-rate underlyingdesignated by as payments changes notional and in over amount. interest that the The ratesIncome life qualify effective from and of a is as portion the subsequently agreements of cash reclassifiedearnings. without changes The into flow Company earnings in did hedges in the not the is any fair period have initially that derivatives value outstanding the of recorded prior hedged derivatives to in forecasted September transaction 30, Accumulated affects 2016. Otherterm Comprehensive wholesale fundingCompany did transactions. not Since recordderivatives entering any would hedge into be ineffectiveness.income recognized the The directly related derivatives ineffective in to portion inCompany’s earnings. derivatives of variable Amounts the the rate will reported borrowings. change third be$1.5 During in in million quarter the reclassified will accumulated fair next be of to other value reclassified twelve as of comprehensive interest months, 2016, an the the increase expense the to Company interest as estimates expense. that interestFair an Values payments additional of are Derivative Instruments made on the on Balance Sheet the classification on the Consolidated Balance Sheets as of December 31, 2016 and December 31, 2015:

FORM 10-K oa —$—$ $— — $ $— — $ $— $(12,550) $— $— — $ its on The default $12,550 counterparty. in the declared with be positions also derivative could its $— Company terminate the to then required be indebtedness, $12,550 could its and of obligations any derivative on defaults Company Features Contingent Credit-risk-related $— $— Total Assets: 2015 31, December Total $— $(440) Assets: 2016 31, December tabular The value. Company’s fair the on of presented disclosure are tabular liabilities 2015. $— and the 31, assets December to derivative and $12,110 that reconciled Sheets. location 2016 be Balance the 31, Consolidated can provides December value liabilities fair of derivative of as disclosure of Sheets amounts Balance net Consolidated The the in derivatives Company’s Derivatives Offsetting Total Flow Cash in Derivatives have any not did Company The 2015. and 2016 31, December 2016. of 30, September as to prior Income outstanding derivatives of Statement Consolidated Statement Income the on Instruments Derivative of Effect egn Relationships: Hedging neetRt wp —$—$ $— — $ $— — $ $— $(12,550) $— the if where provision a contain that counterparties $— derivative — its of each with agreements $ has Company The $12,550 $— $12,550 Swaps Rate Interest Swaps Rate Interest the of presentation net a and offsetting, of effects the presentation, gross a presents table following The $— $12,110 swaps rate Interest the on instruments financial derivative Company’s the of effect the presents table following The NETR ACR,IC N SUBSIDIARIES AND INC. BANCORP, INVESTORS ne eebr31, December Ended Ls)Rcgie in Recognized (Loss) muto anor Gain of Amount EfciePortion) (Effective C nDerivative on OCI wleMonths Twelve 2016 oe oCnoiae iaca Statements Financial Consolidated to Notes Recognized Amounts 2015 Gross Accumulated Reclassified oainof Location (Effective xes (4)$— $(440) expense C into OCI Portion) Interest anor Gain Income (Loss) from Amounts 129 Offset Gross wleMnh Ended Months Twelve muto anor Gain of Amount e Amounts Net rmAccumulated from Ls)Reclassified (Loss) EfciePortion) (Effective C noIncome into OCI 2016 Presented I thousands) (In eebr31, December I thousands) (In 2015 rs mut o Offset Not Amounts Gross Instruments Financial noe$ $— $— income non-interest Other Recognized oainof Location (Ineffective Derivative nIncome in Portion) anor Gain (Loss) on Collateral Posted Cash ne eebr31, December Ended IefciePortion) (Ineffective muto anor Gain of Amount Ls)Recognized (Loss) wleMonths Twelve 2016 nIcm on Income in Derivative e Amount Net 2015

FORM 10-K Fair Value Measurements 130 Notes to Consolidated Financial Statements INVESTORS BANCORP, INC. AND SUBSIDIARIES ”, we group our assets and liabilities at fair value in three levels, based on the markets in which prices for identicaltechniques or for similar which all instruments significant in assumptions are markets observable in that the are market. notobservable active in the and market. model-basedthat market These valuation participants unobservable would assumptions useof in reflect option pricing our pricing the own asset models,determined or estimates discounted liability. with of cash Valuation precision assumptions flow techniques and includeasset models or the may and liability. use similar not techniques. be The realized results in cannot an be actual sale or immediate settlement of the • Level 1 —• Valuation is based upon Level quoted prices 2 for — identical instruments Valuation traded is in active based markets. upon quoted• prices for similar Level instruments 3 in — active Valuation markets, is quoted generated from model-based techniques that use significant assumptions not The Company has minimum collateral posting thresholds with its derivative counterparties and posts We use fair value measurements to record fair value adjustments to certain assets and liabilities and to In accordance with Financial Accounting Standards Board (“FASB”) ASC 820, “ We base our fair values on the price that would be received to sell an asset or paid to transfer a liability in an Our available-for-sale portfolio is carried at estimated fair value on a recurring basis, with any unrealized Company has agreementscompany with fails certain to ofterminate maintain its its its derivative positions derivative status with as the counterparties counterparty. a that well contain capitalized a institution, provision thencollateral where the on if Company a daily the couldthese basis agreements. be as required required to by the clearing house against13. the Fair Value Company’s Measurements obligations, as required by determine fair value disclosures.recurring Our securities basis. available-for-sale Additionally, andliabilities from derivatives on are time a recorded non-recurring to at basis,receivable fair such time, and as value real we held-to-maturity on estate securities, may a ownedlower-of-cost-or-market mortgage (“REO”). be servicing accounting These rights required non-recurring or (“MSR”), fairmortgage to loans write-downs value banking record adjustments of activities involve at individual the wewhich fair assets. application have are of value Additionally, commitments considered other in tofinancial assets connection free-standing fund condition or loans with or derivative results held-for-sale of our instruments, operations. and the commitments to fair sell values loans, ofand which Disclosures are notthe assets material are to traded and our the reliability of the assumptions used to determine fair value. These levels are: orderly transaction between marketuse participants of at observable inputs the and measurement minimize date. the ASC use of 820 unobservable requires inputs usAssets when to Measured measuring at fair maximize Fair value. the Value on aSecurities Recurring available-for-sale Basis gains and losses, net ofThe taxes, fair reported values as of accumulated available-for-saleCompany other securities obtains comprehensive are one income/loss based price in for ongenerally stockholders’ each quoted uses equity. security market quoted primarily prices or from (Level otherderives a 1), observable the third-party where inputs security pricing available. for prices service The the through (pricingthrough determination recently service), the of reported which reporting fair trades date value. for based The identical upon pricing or available service similar observable normally securities, market making information. adjustments For securities not actively traded

FORM 10-K sesadlaiiismaue tfi au narcrigbssa eebr3,21 n eebr3,2015. 31, December and 2016 31, December at basis recurring a on value fair at measured liabilities and assets curves yield benchmark as such inputs, observable primarily uses spreads. that rate model interest valuation and a on based are agreements methodology prices the the value Derivatives in of fair adjustment reasonableness of in the resulted review test historically and service. not compares to pricing has procedures indices Company the services from market verification the pricing obtained relevant price Additionally, independent the to to by source. internal compares the provided returns service pricing Company Company’s documentation for and pricing the secondary The values the responsible a Specifically, prices. market from to value. is reported reported received fair service the Company spreads, prices of pricing in credit the the estimates the changes yields, on reasonable from As benchmark analyses are received quotes. quarterly to, prices prices broker performs limited the it whether not non-binding are value, determine that are and fair Inputs but securities. speeds of flow include, similar cash determination prepayment methodologies for discounted markets or valuation rates, the instruments the default in comparable in observable of currently prices used are market often quoted that use inputs may incorporating service analyses, pricing the 2), (Level eiaiefnnilisrmns$———— — — — $ — instruments 12,550 financial Derivative — 12,550 $ sale: for available Securities instruments financial Derivative sale: for available Securities our of value swap carrying the rate determine interest to used of assumptions valuation values of level fair the provide The tables following inputs. The 2 Level utilizing value fair at reported are Derivatives qiyscrte ,9 ,9 — — 6,495 6,495 $ — — securities: Mortgage-backed 6,660 securities Equity 6,660 $ securities: Mortgage-backed securities Equity oenetNtoa otaeAscain2,7 469— — 24,679 726,072 — 547,451 — — — 726,072 24,679 547,451 Association Mortgage National Government Association Mortgage National Federal Corporation Mortgage Loan Home Federal — — 46,747 — 1,008,587 598,439 — — — 46,747 1,008,587 598,439 Association Mortgage National Government Association Mortgage National Federal Corporation Mortgage Loan Home Federal oa otaebce securities mortgage-backed Total securities mortgage-backed Total available-for-sale available-for-sale oa euiisaalbefrsl 1346764512822— 1,298,202 6,495 $1,304,697 available-for-sale securities Total — 1,653,773 6,660 $1,660,433 available-for-sale securities Total NETR ACR,IC N SUBSIDIARIES AND INC. BANCORP, INVESTORS oe oCnoiae iaca Statements Financial Consolidated to Notes 131 ,9,0 ,9,0 — 1,298,202 — 1,298,202 — 1,653,773 — 1,653,773 Total Total arigVlea eebr3,2015 31, December at Value Carrying 2016 31, December at Value Carrying ee 1 Level 1 Level I thousands) (In thousands) (In ee 2 Level 2 Level ee 3 Level 3 Level

FORM 10-K 132 Notes to Consolidated Financial Statements INVESTORS BANCORP, INC. AND SUBSIDIARIES There have been no changes in the methodologies used at December 31, 2016 from DecemberThere 31, were 2015, no and Level 3 assets measured at fair value on a recurring basis for the years ended December 31, Mortgage servicing rights are carried at the lower of cost or estimated fair value. The estimated fair value of Loans which meet certain criteria are evaluated individually for impairment. A loan is deemed to be Other Real Estate Owned is recorded at estimated fair value, less estimated selling costs when acquired, thus there were no transfers between Level 1 and Level 2 during the year ended December 31,2016 2016. and December 31, 2015. Assets Measured at Fair Value on a Non-RecurringMortgage Basis Servicing Rights, net MSR isincorporating obtained assumptions through marketrates, participants independent prepayment would speeds, third servicing use income,the in party servicing determining market’s costs, valuations default fair perception ratesconsidered value and through of other two including future market an of market driven interest the data,prepayment discount analysis including most rate speeds significant of movements. ranging inputsmortgage The future in from servicing prepayment the rights. 3.15% cash A model. speed tousing significant At flows, and Level degree 24.18% December 3 of the 31, inputs. and judgment discount The 2016,fair is a use value involved rate the estimate. of discount in fair are different valuing rate value assumptions the could model mortgage of have servicing used a 14.27% rights significant for positive or the negativeImpaired valuation effect Loans on of Receivable the the impaired if it isstatus, a loans commercial modified loanoutstanding principal with in if an management a outstanding hasdue under specific balance troubled the information greater contractual that debt terms than itas of restructuring, is $1.0 such, the probable are loan million and carried they agreement. and at will Ourcalculated other the impaired not on using estimated loans collect non-accrual commercial the are fair all generally value fair amounts collateralloans. loans of value dependent the In of and, with collateral the collateral less event $1.0 based estimatedtime the selling on most million and costs. independent recent Estimated other third-party appraisal fair in existing appraisals does value factors, appraised is for not management value reflect collateral-dependent based the will onestate current their obtain market knowledge transactions, an conditions of due the updated anddiscounted to property, appraisal local the in for real passage or a estate estimated of range make marketestimates conditions, selling of the downward recent 0%-25% fair real costs, adjustments for valuereflect to if estimated using management’s the own costs discounted applicable. estimates to cash of At the sell. flows assumptions For based December as non on a 31, market collateral-dependent inputs participant 2016, that loans, would in are management appraisals pricingOther largely such Real were loans. unobservable Estate Owned and instead establishing a new costadjustments basis. to Fair comparable value assets is basedan generally on additional the based 0%-25% appraisers’ on for marketfair estimated independent knowledge costs value, appraisals. and to less These experience, sell. estimated appraisals andthe When are selling include an asset discounted costs, asset declines, is is a charged acquired,nature writedown to the and the is excess allowance recorded of may for through theacquisition be loan are loan expense. generally losses. balance adjusted The expensed. If over valuation in the of estimated the foreclosed fair future assets value is because of subjective of in changes in economic conditions. Operating costs after

FORM 10-K o hc ehv oiieitn n blt ohl omtrt,i are taotzdcs.Management cost. amortized at carried is maturity, to hold to ability and intent positive a have we which for Held-to-Maturity Securities Equivalents Cash and Cash below. forth set are basis non-recurring or recurring a on value Disclosures Value Fair Other Market owned estate real Other Type Security Market sale for held Loans Estimated Estimated loans Impaired net MSR, of value basis. Type carrying Security non-recurring to a change on the no value fair fair was For at at there 2015. measured measured 2015, 31, sale owned 31, for estate December December held real ended and loans other year or 2016 of the loans value 31, impaired For carrying December MSR, basis. to change non-recurring at no a basis was on non-recurring there value 2016, a 31, on December ended value year fair at measured assets characteristics. market similar secondary with loans observable for uses transactions Company market the closed available, recent When on basis. pricing non-recurring including a data, on value fair at measured Sale For Held Loans u edt-auiyprflo ossigpiaiyo otaebce euiisadohrdb securities debt other and securities backed mortgage of primarily consisting portfolio, held-to-maturity Our value. fair approximates amount carrying the banks, from due and cash For fair at recorded not instruments financial Company’s the for assumptions and methods estimates, value Fair our of value carrying the determine to used assumptions valuation therefore of are level and the provide value tables fair following or The cost of lower the at recorded are sale for held loans mortgage Residential comparable Flow Cash flow cash Technique Valuation comparable NETR ACR,IC N SUBSIDIARIES AND INC. BANCORP, INVESTORS Technique Valuation oe oCnoiae iaca Statements Financial Consolidated to Notes aktblt .%-45 .5 1 313 — 1,403 — — 313 — 3.45% 1,403 12,877 4.5% - 26.00% 2.5% — 29.0% - 22.0% marketability — of Lack $12,877 default of 9.84% probability 24.18% - and 3.15% marketability of Lack speeds Prepayment Unobservable aktblt .%-2.%89%$1 510 — — $510 8.90% 25.0% - 0.0% marketability of Lack Input Unobservable Input 133 Range Range Weighted Average Weighted Input Average Input 1,9 14,593 — — $14,593 arigVlea eebr3,2016 31, December at Value Carrying arigVlea eebr3,2015 31, December at Value Carrying 50——510 — — $510 Total Total ee 1 Level ee 1 Level I thousands) (In I thousands) (In ee 2 Level ee 2 Level ee 3 Level ee 3 Level

FORM 10-K 134 Notes to Consolidated Financial Statements INVESTORS BANCORP, INC. AND SUBSIDIARIES The fair value of the Federal Home Loan Bank of New York (“FHLB”) stock is its carrying value, since this Fair values are estimated for portfolios of loans with similar financial characteristics. Loans are segregated The fair value of performing loans, except residential mortgage loans, is calculated by discounting The fair value of deposits with no stated maturity, such as savings, checking accounts and money market utilizes various inputssecurity to primarily determine from the athe third-party fair determination pricing of value service, fair of which value.trades generally The the for pricing uses portfolio. service quoted identical normally or Theobservable or derives other the Company similar market observable security obtains inputs securities, prices information. through for oneprices making For recently price reported adjustments securities of for through not comparable each observable the actively in instruments reporting traded, the markets or date the forbut based pricing discounted similar are securities. upon service not cash Inputs limited available may that flow to, arequotes. use benchmark often In analyses, yields, quoted used the credit in incorporating absence market spreads, the ofare default valuation inputs quoted methodologies rates, both prices include, prepayment that significant and speeds in are andinvestment. to non-binding an Valuation currently the broker illiquid techniques market, fair are valuation basedflows, value techniques, on discount measurement various which rates, assumptions, require rate and of including, inputsCompany unobservable, return, but that is adjustments not are responsible for limited for used nonperformance to thefrom and forecasted to determination the liquidity, cash determine of pricing and fair liquidation service fair value, values.Company to value As it compares determine the performs the of whether quarterly prices the the analysesCompany received prices on from compares are the the reasonable prices changes pricing estimates received reasonableness service in of to of the fair a the value. reported secondary reported Specifically,value pricing market prices. the source. methodology values The Additionally, Company’s documentation the andadjustment internal provided returns in price the to by prices verification obtained relevant independent procedures from market and the pricing pricing review indices service. services of to fair has test not the historicallyFHLB Stock resulted in is the amount for whichhold it a could minimum be investment redeemed. based There upon is the no balance active of market mortgage for related this assets stock held and byLoans the the Bank member. is required to by type suchadjustable as rate residential interest terms mortgage and by and performing consumer. and non-performing Each categories. loan category is furtherscheduled cash segmented flows into through theand fixed estimated interest and maturity rate using risk estimateddiscounting inherent market contractual in discount cash the rates flows loan. thatmarket reflect sources adjusted For adjusted the performing for to credit residential prepayment reflectnon-performing mortgage differences estimates in loans loans, using servicing is fair and discount value based credittiming rates costs, is on of based if estimated recent applicable. on anticipated by Fair external secondary approach value cash to appraisals for flows. fair significant of value, Fair but collateral instead values securing are estimated based such on loans, in a comparison adjusted this to for manner current the market doDeposit rates Liabilities for not comparable fully loans. incorporate an exit price accounts, is equal todiscounted the value amount of payable contractualcurrently offered on cash for demand. deposits flows. of The The similar fair remaining discount maturities. value rate of is certificates estimated of using deposit the is rates based which on approximate the

FORM 10-K olwn table. following outstanding difference our the of condition. nature considers financial short-term also our the to value to immaterial Due fair are rates. commitments loans, these committed of rate creditworthiness the values present and fixed fair rates the the originate interest commitments, and of to agreements levels the commitments current of For between terms counterparties. remaining the the account of into taking agreements, similar Credit Extend to Commitments borrowings for offered rates the approximate which maturities. rates remaining using similar flows of cash contractual discounted using estimated Borrowings orwdfns3230032793—32793— — — 16,650,529 3,277,983 — 3,414,528 — 7,431 — — — — — 3,277,983 3,414,528 — 3,263,090 3,416,310 178,437 — 16,650,529 7,431 16,661,133 77,817 178,437 — — 7,431 1,810,869 178,437 — — 10,647,346 — — 1,298,202 10,647,346 6,495 148,904 funds $10,647,346 Borrowed — deposits 18,391,018 Time 1,888,686 deposits time than 4,545,745 148,904 other — 2,938,137 Deposits, — 1,844,223 1,304,697 liabilities: — Financial — 148,904 1,304,697 loans Net 38,298 sale $ for held Loans — FHLB — in Stock 4,545,745 — 2,938,137 held-to-maturity Securities — 4,546,251 2,947,560 available-for-sale Securities equivalents 237,878 cash — and 18,391,018 Cash 18,569,855 38,298 assets: 79,242 Financial 237,878 — — 38,298 1,703,559 237,878 — — 12,333,273 1,653,773 12,333,273 6,660 164,178 funds $12,333,273 Borrowed deposits Time 1,782,801 deposits time than 164,178 other Deposits, 1,755,556 1,660,433 liabilities: Financial 164,178 1,660,433 loans Net sale $ for held Loans FHLB in Stock held-to-maturity Securities available-for-sale Securities equivalents cash and Cash assets: Financial the in presented are instruments financial Company’s the of values fair estimated and values carrying The into enter to charged currently fees the using estimated is credit extend to commitments of value fair The or available, when values, fair estimated dealers’ securities on based are borrowings of value fair The NETR ACR,IC N SUBSIDIARIES AND INC. BANCORP, INVESTORS oe oCnoiae iaca Statements Financial Consolidated to Notes Carrying Carrying value value 135 Total Total eebr3,2015 31, December 2016 31, December I thousands) (In thousands) (In ee 1 Level 1 Level siae arValue Fair Estimated Value Fair Estimated ee 2 Level 2 Level ee 3 Level 3 Level

FORM 10-K 136 Notes to Consolidated Financial Statements INVESTORS BANCORP, INC. AND SUBSIDIARIES Fair value estimates are made at a specific point in time, based on relevant market information and Fair value estimates are based on existing on- and off-balance-sheet financial instruments without The Bank and the Company are subject to various regulatory capital requirements administered by the Quantitative measures established by regulation to ensure capital adequacy require the Bank and the As of December 31, 2016, the most recent notification from the Federal Deposit Insurance Corporation Limitations information about the financialresult instrument. from These offering estimatesBecause for do no sale not market exists reflect at forjudgments any one a regarding premium portion future time or of expected the the loss discountfinancial Company’s experience, Company’s that instruments, financial current could entire instruments, and economic fair conditions, other holdingsmatters value risk factors. of estimates characteristics of These are of a significant estimates based various particularcould on are judgment significantly financial subjective affect and the instrument. in estimates. therefore nature cannot and be involve uncertainties determined and with precision.attempting Changes to in estimate assumptions theconsidered value financial of anticipated instruments. future Significantassets, business assets premises and that and the are equipment valuebenefits not and of are considered bank assets not financial and owned considered assets liabilities lifeunrealized financial include that insurance. gains liabilities. deferred are and Liabilities In not tax losses for addition,the can pension the estimates. have and tax a other ramifications significant related postretirement effect to on the fair realization value of estimates the and have14. not Regulatory been Capital considered in federal banking agencies.possibly Failure additional to discretionary actions meetthe by minimum regulators Company’s that, capital ifframework consolidated requirements undertaken, for could can financial prompt have initiate corrective ainvolve statements. direct action, certain material quantitative the mandatory Under effect Bank measures and on regulatory and capital accounting the of practices. Company adequacy assets, Capital mustthe amounts guidelines regulators meet liabilities about and specific components, and classification and capital risk are weightings, guidelines certain the and also that other subject off-balance-sheet factors. regulatory to items qualitative judgments as by calculatedCompany to under maintain minimumTier amounts 1 and risk-based ratios capitalDeposit of and Insurance Tier Corporation Total 1 and risk-based the leverageleverage other capital ratio, and federal (as Common bank risk-based defined regulatory equity capital agenciesconsistent in tier requirements issued the 1 with a and regulations). final risk-based, the agreements rule In methodprovisions that that July for revised of their 2013, were calculating the the risk-weighted reachedminimum Dodd-Frank Federal assets by risk-based Act. to make the and The them Accord Final leverage Basel adopted Capital capital Committee by Rules requirements, the onequity also Basel consistent tier Banking Committee revised 1 with Supervision risk-based on the the ratioand Banking and and quantity Reform Company Supervision, changes certain and on to or Act January the quality Basel andstarting calculation 1, III of of at 2015. the capital risk-weighted required The 0.625% Third assets standards. required on becameand The Basel minimum January effective 2.5% Common Conservation 1, for on Buffer the 2016 January Bank will and 1,bonus be increasing 2019. payments The phased to if rules in 1.25% the impose incrementally, on minimumBank restrictions January Conservation met on Buffer 1, the capital is currently 2017, distributions not applicable and 1.875% Conservation met. certain on Buffer As discretionary January of of cash 0.625%. 1, December 2018 31, 2016 the Company andcategorized the the Bank ascategorized well as capitalized well under capitalized, the the regulatory Bank framework for and prompt the corrective Company action. must To maintain be minimum Tier 1 leverage ratio,

FORM 10-K neteti t hlyondsbiir,IvsosBn,uigteeut ehdo accounting. of method equity the using Bank, Investors subsidiary, wholly-owned its in investment Statements Financial Only Company Parent 15. company. holding Bank the to apply not do provisions action corrective Prompt (1) Inc: Bancorp, Investors Bank: 2015: 31, December of As Inc: Bancorp, Investors Bank: 2016: 31, December of As requirements FDIC the and requirements adequacy institution. capital well-capitalized minimum a FDIC as the classification to for compared 2016 31, and December Bank the changed tables. have the believes in management forth that set as notification capital that risk-based since Total category. events and Company’s or capital the conditions risk-based no 1 are Tier risk-based, There 1 tier equity Common oa ikBsdCptl341692.5 ,9,2 .0 / n/a n/a n/a n/a n/a n/a n/a n/a the 8.00% reflect 6.00% only) company (parent Inc. Bancorp, 1,290,926 Investors 4.00% for 968,194 21.45% statements financial condensed 10.00% 8.00% following 3,461,649 20.20% The 825,139 4.50% 1,612,274 3,259,928 $ 1,289,819 15.80% 5.00% 8.00% 726,146 $3,259,928 6.00% 6.50% $1,030,759 20.20% 1,289,819 4.00% 967,364 3,259,928 17.12% 1,047,978 2,760,081 15.87% 824,607 4.50% 2,558,334 $ Capital 12.41% Risk-Based Total Capital 725,523 $2,558,334 Risk-Based 1 Tier risk-based 1 tier 15.87% equity Common Ratio 2,558,334 Leverage n/a 1 Tier n/a n/a n/a Capital Risk-Based Total n/a Capital Risk-Based n/a 1 Tier n/a risk-based 1 tier equity Common Ratio Leverage 8.625% n/a 1 Tier 6.625% 1,601,155 4.00% 17.75% 1,229,872 3,295,948 16.52% 10.00% 910,058 5.125% 8.00% 3,066,401 $ 1,855,103 13.48% 5.00% 951,411 $3,066,401 1,484,082 8.625% $1,136,917 16.52% 6.625% 6.50% 1,600,026 4.00% 3,066,401 15.99% 1,229,006 1,205,817 2,965,720 14.75% 909,534 5.125% 2,736,173 $ Capital 12.03% Risk-Based Total Capital 950,740 $2,736,173 Risk-Based 1 Tier risk-based 1 tier 14.75% equity Common Ratio 2,736,173 Leverage 1 Tier Capital Risk-Based Total Capital Risk-Based 1 Tier risk-based 1 tier equity Common Ratio Leverage 1 Tier of as ratios and amounts capital actual Company’s the and Bank the of summary a is following The NETR ACR,IC N SUBSIDIARIES AND INC. BANCORP, INVESTORS oe oCnoiae iaca Statements Financial Consolidated to Notes Amount Amount Actual Actual 137 Ratio Ratio Dlasi thousands) in (Dollars Dlasi thousands) in (Dollars Amount Amount iiu Capital Minimum iiu Capital Minimum Requirement Requirement Ratio Ratio ob elCapitalized Well be To ob elCapitalized Well be To orcieAction Corrective orcieAction Corrective Amount Amount ne Prompt Under ne Prompt Under Provisions(1) Provisions(1) Ratio Ratio

FORM 10-K 2014 2015 2015 (In thousands) Year Ended December 31, 2016 33,290 4,900 2,710 December 31, (In thousands) 2016 138 Balance Sheets Statements of Operations Notes to Consolidated Financial Statements INVESTORS BANCORP, INC. AND SUBSIDIARIES Total AssetsTotal Liabilities and Stockholders’ Equity $3,131,056 3,323,113 $3,131,056 3,323,113 Cash and due from bankSecurities available-for-sale, at estimated fairInvestment value in subsidiaryESOP loan receivableOther assetsTotal liabilities 6,918Total stockholders’ equity 1,733 $ 195,114 2,792,474 569,513 2,611,080 92,839 94,889 3,123,245 43,711 3,311,647 $ 45,898 7,811 11,466 Liabilities and Stockholders’ Equity: Assets: Income (loss) before income tax expenseNet income 29,237 1,676 (9,530) $192,125 181,506 131,721 Interest expenseOther expenses 120 3,933 3,170 54 12,197 43 Interest on ESOP loan receivableDividend from subsidiaryInterest on deposit with subsidiaryInterest and dividends on investmentsGain on securities transactions $ 3,084 3,151 132 30,000 2,499 2 65 — 72 2 1,682 64 — 2 145 Income tax (benefit) expenseIncome (loss) before undistributed earningsEquity of in subsidiary undistributed earnings of subsidiary 28,785 1,136 (5,855) 163,340 180,370 137,576 452 540 (3,675) Expenses: Income:

FORM 10-K ahaddefo aka n fya 9,1 6,1 1,022,231 569,513 6,515 195,114 $ 1,022,231 569,513 year of end at bank from due year and of Cash beginning at bank from due and Cash activities: financing from flows Cash 1,482 131,721 181,506 433 $192,125 activities: investing from flows Cash 543 activities: operating from flows Cash income comprehensive other Total tax: of net income, comprehensive Other income Net pineecs 4372953,710 (42,555) (66,553) 2,985 (87,395) — (82,291) 34,317 38,227 (13,523) — — (382,922) (363,410) 2,149,893 1,015,716 11,307 (452,718) — 2,069,199 — (374,399) (467,332) — 3,093 (411,384) — 2,062 — — (493) (1,074,947) 48 467 2,050 (1,060,525) — 4,762 bank from due and — cash — in increase (2,878) (decrease) activities 2,700 Net financing — by provided — in) (used cash Net (5,000) 7,042 72 — paid Dividends exercise — Option 131,721 stock treasury of 9,852 stock Purchase treasury of sale from 181,506 stock Proceeds common of issuance from Proceeds 39,863 192,125 ESOP $ to Loan activities investing by provided in) (used cash Net merger MHC from received Cash loan ESOP on collected Principal available-for-sale securities equity of Redemption held-to-maturity investments of Purchase available-for-sale acquisition investments for of paid Purchase cash of net received Cash Bank the to contributed Capital activities operating by provided cash Net 1,482 433 by provided 543 cash net to income net reconcile to Adjustments income Net available-for-sale securities on gain Unrealized prtn activities: operating ano euiistascin 7)162145 525 2,227 1,682 2,107 4,927 10,000 (72) 14,805 (3,655) — — (137,576) (180,370) (163,340) 133,203 181,939 liabilities other in $192,668 increase (Decrease) assets other in (increase) Decrease transactions securities on foundation Gain charitable to stock in subsidiary) Contribution of earnings undistributed in (Equity income comprehensive Total NETR ACR,IC N SUBSIDIARIES AND INC. BANCORP, INVESTORS oe oCnoiae iaca Statements Financial Consolidated to Notes te opeesv Income Comprehensive Other ttmnso ahFlows Cash of Statements 139 2016 erEddDcme 31, December Ended Year 2016 erEddDcme 31, December Ended Year I thousands) (In I thousands) (In 2015 2015 2014 2014

FORM 10-K December 31 December 31 September 30 September 30 2015 Quarter Ended 2016 Quarter Ended June 30 June 30 (In thousands, except per share data) (In thousands, except per share data) March 31 March 31 140 Notes to Consolidated Financial Statements INVESTORS BANCORP, INC. AND SUBSIDIARIES losses 135,442 141,552 146,274 145,816 losses 149,563 152,305 154,606 163,960 Basic earnings per common shareDiluted earnings per common share $ $ 0.12 0.12 0.14 0.14 0.15 0.15 0.14 0.14 Income before income tax expenseNet income 67,067 73,301 71,659 68,850 $ 41,947 46,362 48,794 44,402 Net interest incomeNet interest income after provision for loan 144,442 148,552 151,274 150,816 Net incomeBasic earnings per common shareDiluted earnings per common share $ $ 0.14 0.14 0.15 0.15 $ 44,669 0.17 0.17 45,140 49,850 0.18 0.18 52,465 Net interest income after provision for loan Income before income tax expense 71,124 72,765 71,728 83,454 Net interest income 154,563 157,305 159,606 168,710 Income tax expense 25,120 26,939 22,865 24,448 Interest and dividend incomeInterest expenseProvision for loan lossesNon-interest incomeNon-interest expenses $175,159 181,529 186,897 188,138 30,717 9,000 32,977 7,000 35,623 8,534 76,909 5,000 11,585 79,836 37,322 5,000 11,306 85,921 85,666 8,700 Non-interest incomeNon-interest expensesIncome tax expense 8,707 87,146 11,469 91,009 26,455 91,398 8,520 27,625 89,010 21,878 8,504 30,989 Interest and dividend incomeInterest expenseProvision for loan losses $192,107 194,960 198,374 208,079 37,544 5,000 37,655 5,000 38,768 5,000 39,369 4,750 The following tables are a summary of certain quarterly financial data for the years ended December 31, 16. Selected Quarterly Financial Data (Unaudited) 2016 and 2015.previously Income disclosed tax 2016 interim expense,ASU periods No. net have 2016-09, been income see revised Note and to 19, Recent reflect diluted Accounting the Pronouncements. shares impact of included the in Company’s the adoption of quarterly financial data

FORM 10-K 1 o h er ne eebr3,21,21 n 04 hr ee1,4,2,1,0,7,ad142,953 and 18,200,877, 19,046,222, were there 2014, and 2015 2016, 31, December ended years the For (1) share. per earnings Share Per Earnings 17. iue .4$05 0.38 0.38 $ $ 0.55 0.55 $ $ 0.64 0.65 $ $ for anti-dilutive been have would not so were do that to future because the share in per share presented. earnings per periods diluted the earnings 3,342,312 of basic computation dilute the potentially in included could that respectively, awards, equity 3,169,921 131,721 $ Diluted 3,374,051 181,505 Basic share common per Earnings $ — outstanding shares 192,125 common Weighted-average equivalents(1) stock common dilutive $ of Effect — outstanding shares common Weighted-average Shares stockholders common to applicable Earnings per earnings diluted and basic for Earnings diluted to basic of reconciliation and calculations share per earnings our of summary a is following The iue 0,5,8 3,3,4 347,731,571 332,933,448 344,389,259 300,954,885 329,763,527 297,580,834 diluted basic share common NETR ACR,IC N SUBSIDIARIES AND INC. BANCORP, INVESTORS oe oCnoiae iaca Statements Financial Consolidated to Notes 141 2016 Dlasi huad,ecp e hr data) share per except thousands, in (Dollars o h erEddDcme 31, December Ended Year the For 2015 2014

FORM 10-K Net Tax Gross Year ended December 31, 2014 Net Tax (Dollars in thousands) Gross Year ended December 31, 2015 142 Net Tax Notes to Consolidated Financial Statements Gross Year ended December 31, 2016 INVESTORS BANCORP, INC. AND SUBSIDIARIES comprehensive income $305,745 (110,395)195,350 273,167 (97,083)176,084 211,934 (76,921)135,013 comprehensive (loss) income 6,673 (3,448) 3,225 (7,710) 2,289 (5,421) 5,462 (2,170) 3,292 Total Total other status of retirement obligationson securities available-for-sale 12,452securities (19,399) (4,981)reclassified to 7,115 held 7,471 (12,284)to maturity available (7,982) (2,425)for sale 3,049 970 (4,933)adjustment (1,455) for 9,836 (8,402)security gains (3,884) 3,360included 5,952 in net (5,042) income 1,846impairment accretion on debt (754) securities 1,092derivatives arising 2,448 (2,264)during the 1,488 (1,000) period 1,448 906 (608) 2,918 (1,358) 12,550 (1,553) (1,192) 880 (5,126) 1,726 1,802 7,424 6 (736) (1,547) — 1,066 (233) 1,343 — 95 (549) — (138) 794 — — — The components of comprehensive income (loss), both gross and net of tax, are as follows: Change in funded Unrealized (loss) gain Accretion of loss on Reclassification Other-than-temporary Net gains on income (loss): 18. Comprehensive Income (Loss) Net incomeOther comprehensive $299,072 (106,947)192,125 280,877 (99,372)181,505 206,472 (74,751)131,721

FORM 10-K mrvmnst mlyeSaeBsdPyetAccounting”, Payment Share-Based Employee to Improvements periodic net Pronouncements of Accounting computations Recent the 19. in included are components loss comprehensive other accumulated These (1) (5,421) — 3,225 1,066 7,424 (27,825) (6,480) 880 (22,404) — 1,448 (13,642) is (13,750) — income (24,600) net (1,455) where statement (27,825) the 1,092 in 1,371 item line (14,816) affected 7,424 the and income of — 7,851 7,471 (3,080) statements (12,870) presented. consolidated the to loss (12,271) (13,750) $(12,366) (4,528) (1,988) 1,371 2015 31, —December $(10,911) Balance (4,895) change $ Net 2014 (3,080) 31, December — Balance 2016 31, December — $(12,366) Balance change Net 2015 31, December — Balance 2015: and 2016 31, December ended years the for loss comprehensive nMrh21,teFS sudAU2016-09, ASU issued FASB the 2016, March In details. additional for 10 Note See plan. benefit post-retirement other and plans benefit defined our for cost comprehensive other accumulated from reclassified amounts about information presents table following The other accumulated of component each of balances the in changes after-tax the presents table following The neetExpense: Interest obligations(1) retirement of status funded in Change net in included gains for adjustment Reclassification income e ftx$114 1,386 $(1,144) 2,362 35 3,915 1,859 tax of Net tax before Total benefits fringe and Compensation noetxbnft119976 1,179 benefit tax Income (1,553) $(2,264) benefits: fringe and Compensation transactions security on Gain NETR ACR,IC N SUBSIDIARIES AND INC. BANCORP, INVESTORS mriaino e an1601,354 49 1,610 2,512 — — 249 unrealized for adjustment Reclassification — gain net of Amortization cost service prior of asset Amortization or obligation net of Amortization obligation net of Adjustment osso eiaie 4 — 440 derivatives on losses uddsau of status funded oe oCnoiae iaca Statements Financial Consolidated to Notes obligations retirement hnein Change crto of Accretion reclassified ohl to held to securities maturity oson loss 143 Cmesto—tc opnain(oi 718): (Topic Compensation “Compensation—Stock nsecurities on o-aeand for-sale nlddin included Unrealized e income net available- Dlasi thousands) in (Dollars e tnadta hne h conigfor accounting the changes that standard new a gains gains crto on accretion Other-than- erEddDcme 31, December Ended Year impairment temporary securities 2016 debt I thousands) (In derivatives Unrealized an on gains 2015 comprehensive accumulated other Total loss

FORM 10-K “Income Taxes (Topic 740): Intra-Entity Transfers of “Statement of Cash Flows (Topic 230): Classification of 144 “Measurement of Credit Losses on Financial Instruments.” , a new standard which addresses diversity in practice related to eight Notes to Consolidated Financial Statements This ASU addresses the recognition of current and deferred taxes for an intra- INVESTORS BANCORP, INC. AND SUBSIDIARIES In October 2016, the FASB issued ASU 2016-16, In August 2016, the FASB issued ASU 2016-15, In June 2016, the FASB issued ASU 2016-13, certain aspects of share-baseddeficiencies payments to be to recorded employees.related in The the to new income excess guidance statementincome tax requires when tax the benefits excess cash awards tax will vest flows.withholding benefits no or The and purposes are longer standard tax settled. be without also Inemployee’s separately behalf addition, allows triggering for cash classified entities withheld flows liability as shares toprovides should a accounting, repurchase be an presented financing more accounting clarifies as activity a ofCompany policy financing that apart an adopted activity election on employee’s from all ASU to its shares No. other cashCompany account cash flows 2016-09 for recorded for statement, payments an cumulatively, tax and forfeitures cumulative-effect effective madepaid as adjustment for in to on they capital. the the occur. The first an openingbenefit ASU On quarter balances or No. December expense of of 2016-09 in retained 31, requires 2016. theeach earnings that Upon 2016, income and excess statement, of adoption, The tax additional rather the the than benefitselection equity. quarters and This to shortfalls of resulted either be in continue 2016. recorded a toor as Relative benefit estimate income to account to the income tax number forfeitures, tax for of expenseestimating ASU awards in forfeitures the that No. are when number 2016-09 expectedstatement of they to allows of vest, awards an occur. cash as that under entity’s flows Thefinancing current will are accounting guidance, Company activities. now be policy classified The has forfeited. astherefore, Company The elected cash prior elected income flows to periods to from taxemployee continue operating have apply effects activities, withholding its this not of rather existing taxes cash ASU been thanconsistent No. flow practice cash as adjusted. with flows 2016-09 classification of a ASU from on guidanceAccordingly, the No. financing no the prospectively reclassification 2016-09 manner activity for and, also prior on in periods requires is the required. which the Consolidated presentation we Statement of have of certain Assets presented Cash Other Flows; such Than this Inventory.” entity employee asset is withholding transfer andother taxes amends than current in inventory GAAP tofiscal the by defer eliminating years such past. the recognition beginning exceptionadoption until after is for sale permitted intra-entity December to as transfers anhave of 15, of outside the not 2017, assets party. beginning ASU of been includingNo. an No. interim made annual 2016-16 2016-16 period is periods available to for effectiveFinancial determine within which for Statements. for financial the those issuance. statements potential (interim fiscal The or impact years. annual) Company the Early is new currently standard will evaluatingCertain have Cash the Receipts on and provisions Cash thespecific Payments” of Company’s cash flow ASU Consolidated issues:or debt other prepayment debt or instruments extinguishmentof with costs, coupon the settlement interest of borrowing, rates zero-couponsettlement that contingent debt are instruments of consideration insignificant in payments(including insurance relation made bank-owned to claims, life the after effective insuranceinterests proceeds a interest policies), in rate business securitization distributions from transactions; combination, received andprinciple. the separately from proceeds ASU identifiable equity settlement from cash No. method flows 2016-15 the andperiods investees, of is application beneficial within of effective corporate-owned the those for predominance fiscalmethod life fiscal to years. years insurance each beginning Entities period after willissues, policies presented. December the apply If 15, amendments it the 2017, is for standard’sCompany including impracticable those is provisions interim to issues currently using apply would evaluating the astandard be the amendments will retrospective applied provisions have retrospectively prospectively of on transition for the ASU as some Company’s No. of Consolidated of 2016-15 Financial the the to Statements. earliest determine date the practicable. potential The impact the new This ASU significantly changes how entities will measure credit losses for most financial assets and certain other

FORM 10-K hs iclyas niissol pl h mnmn ymaso uuaieefc duteta fthe of as adjustment effect cumulative a of means by within amendment periods the interim a assets. including tax on apply 2017, deferred allowance reduces should 15, other valuation December Entities amendment entity’s after a the years. The beginning for with years fiscal statements. need combination fiscal in those the financial for securities evaluate effective the sale is should for to amendment entity available This requires notes an to financial amendment related that accompanying of asset The has clarifying the form tax option. by entity and deferred in practice the value category or current when fair measurement The sheet in risk the by notion. diversity balance credit with liabilities price instrument-specific the financial accordance the and in exit on in assets value asset the change financial fair using of a at change value presentation from total liability the separate resulting fair the of liability portion measure that a the The to instruments measure income of elected financial comprehensive values. to value other of fair in sheet fair value separately the balance fair present determinable in to the the entity and readily disclose an on income, to requires without net cost amendment required through amortized are investments requires recognized that at value categories, equity entities fair measured different business the of into in public assessment changes requires values with amendment impairment fair value fair determinable the at readily measured simplifies with be to Liabilities securities securities Financial equity equity and classify Assets to Financial guidance of Measurement been and yet Recognition have period conclusions Statements. comparative no Financial such, earliest Consolidated including As Company’s the guidance, the scope. on of the in adoption be of beginning on to impact impact the deemed interim the potential are the after, evaluate including that regarding to into reached exist 2018, continues contracts entered new Company 15, other or The approach the whether December statements. at, retrospective determining under financial modified existing after the A unchanged leases in beginning permitted. lease for adoption presented largely years minimum early applied future with remains fiscal be period, the accounting for reporting must of that value Lessor effective within present periods is date. the reporting guidance commencement at measured The lease asset, guidance. the right-of-use a at and payments, liability lease at a quality recognize credit and time. composition that portfolio at upon of forecasts and dependent extent conditions be The evaluation economic early will Statements. its as it Financial While well begun as as Consolidated has approach). time date, its Company this adoption retrospective on The the at impact option. indeterminable modified that potential is (i.e., elect the ASU change to including the the effective expect guidance origination. of is not beginning amended early of does the the guidance Company of of will 2019; the year as the Entities 15, earnings permitted, which 2018. the retained December is 15, in to adoption December after by adjustment period after beginning cumulative-effect beginning reporting disaggregated a periods periods as first indicator, reporting reporting provisions for annual standard’s annual balance quality and the cost and interim apply credit amortized for interim the permitted by for disclose is to effective adoption asset need is will financial 2016-13 entities estimating addition, for No. of In The methods losses. today. and class lease models, 2016-13 do and ASU assumptions, each they loans. loan entity’s as and for an time, securities regarding allowance over debt allowances to requirements the credit-impaired income as improvements disclosure purchased recognized interest recognize the for will be as expands model entities will than also accounting result, losses rather the a the simplifies earnings As that also in securities. ASU except the immediately today, of losses do cost loans, credit amortized they to, estimated measure the what will limited in to entities reductions not losses, similar than unrealized manner is rather apply with a current not but securities in does debt the includes, at AFS model losses is measured For CECL as This credit securities. and The exposures. to FASB debt guarantees. losses replace (“AFS”) financial credit credit referred the available-for-sale and to will sheet to model, commitments, subject standard, loan standard off-balance new assets securities, the certain financial The The held-to-maturity (1) (2) leases, losses. issuing model. to: and apply loss” credit In cost, will “expected of model, income. amortized an (“CECL”) recognition net loss with delays credit through approach expected guidance loss” value today’s “incurred fair that today’s at c nJnay21,teFS sudAU2016-01, ASU issued FASB the 2016, January In 2016-02, ASU issued FASB the 2016, February In NETR ACR,IC N SUBSIDIARIES AND INC. BANCORP, INVESTORS oe oCnoiae iaca Statements Financial Consolidated to Notes 145 FnnilIsrmnsOeal(utpc825-10): (Subtopic Instruments—Overall “Financial Lae Tpc842)” (Topic “Leases ”Ti mnmn uesdsthe supersedes amendment This .” hc eursallsesto lessees all requires which ,

FORM 10-K The ; and ASU The objective of “Revenue Recognition (Topic “Revenue from Contracts with Customers “Revenue from Contracts with Customers ; ASU 2016-11, The ASU gives an employer whose fiscal year-end “Practical Expedient for the Measurement Date of an 146 ; ASU 2016-10, “Simplifying the Presentation of Debt Issuance Costs.” “Revenue from Contracts with Customers.” Under the new rules, acquirers no longer have to retrospectively adjust Notes to Consolidated Financial Statements INVESTORS BANCORP, INC. AND SUBSIDIARIES . These amendments are intended to improve and clarify the implementation guidance of ASU “Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical In May 2014, the FASB issued ASU 2014-09, In September 2015, the FASB issued ASU 2015-16, “Business Combinations—Simplifying the Accounting In April 2015, the FASB issued ASU 2015-03, In April 2015, the FASB issued ASU 2015-04, Measurement-Period Adjustments.” beginning of the fiscal yearreadily of determinable adoption, fair with values, the whichdate exception should of of be the adoption. amendment applied related prospectivelyrequired, The to to and Company equity is equity securities currently intends investments evaluating without that to the exist impact adopt as on of the its the results accounting of operations, standard financial during position, andthis the liquidity. amendment first is quarter tofor of clarify 2018, U.S. the principles as GAAP fortransfer and goods recognizing IFRS. or revenue services This and orin to update enters the develop into affects scope contracts a of for any commonfor other the revenue entity transfer standards. fiscal standard of The that years nonfinancial ASU beginning either assetsissued is unless the after enters effective those following December for contracts standards into public are related 15,(Topic contracts to business 2017, 606): ASU entities with Principal and 2014-09: for versus customers ASU early financial(Topic Agent 2016-08, to adoption statements Considerations” 606): issued is Identifying Performance permitted.605) Obligations Subsequently, and and the Licensing” Derivatives FASB andUpdates Hedging 2014-09 (Topic and 815): 2014-16 Rescission Pursuant2016-12, to of Staff SEC Announcements Guidance at BecauseExpedients” the of March Accounting 3, 2016 Standards EITF2014-09 Meeting” and have theinterest same effective income date as onexplicitly the excludes interest original net standard. earning interest Theincluding income Company’s loans, assets as leases, revenue well and securities is and asbe comprised liabilities affected. derivatives. other of Accordingly, revenues net and the associated majority non-interest with of financial the income. assets Company’s revenues and The will liabilities, not scope offor guidance provisional amounts included in acquisition-dateknown financial on statements, the when acquisition final date,made facts and and in later circumstances become are a knownadjustments not in later to the current measurement period period period. incomethe are Instead, relating adjustments adjustments to to were that amounts recognized are be that asis would of reported effective have the for been in acquisition recognized date. fiscalThis that in For guidance years, previous public did period. and periods business not if interim However, have entities, a the periods acquirers material guidance within impact in must to those the the ASU fiscal disclose Company’s consolidated years, the financial beginning statements. amount after December of 15, 2015. ASU changes the presentationsuch of debt costs issuance in costsAmortization the in of financial balance the statements. sheet costs Underissuance the is as costs ASU, reported a incurred an as direct entitydeferred before interest charges presents deduction the expense. until that from According associated debtis to the liability funding effective amount the related is is for ASU’s recorded. received debt Basis fiscal ForThis should public liability for guidance years, business did be Conclusions, and rather entities, not debt the interim have reported than guidance a periods on in material as within the impact the an ASU to those balance the asset. fiscal Company’s sheet consolidated years, financial as beginning statements. afterEmployer’s December Defined 15, Benefit 2015. Obligationdoes and not Plan coincide Assets.” withretirement obligations a and calendar related month-endalso plan assets the provides as ability, of guidance asremeasurement the that month-end a on that occur practical is accounting during expedient, closest the to for to period its measure between contributions fiscal defined a year-end. to benefit month-end The ASU measurement the date plan and the and employer’s fiscal significant events that require a

FORM 10-K hr a adt tchleso eray2,21,wt eoddt fFbur 0 2017. 10, February of date record a with 2017, 24, February on stockholders to of paid results was its share through merger the document. with this mutually merger in connection 2016. the presented in and 31, period As capitalized December the transaction. penalties, be ending for merger period to sheet without the the were balance for to transaction, the which operation relating in costs terminated another reflected expensed not one the Company is to The transaction bear the with liability the will in of connection completed, party claims forth not each any in set was that from deadline expenses parties things, termination the other and 2017 The releases among 31, costs 2016. provides, Deposit March 3, own Federal Agreement the the May Termination to its to on Mutual prior Bank The into Investors obtained agreement. entered by be merger submitted originally not application was would the which Corporation of agreement, Insurance approval merger regulatory Financial that the concluded terminate issued. parties to be Princeton to of Bank GAAP. available statement with complies financial or that other format issued and and stockholders form are a to statements in distributed reliance widely financial and use are before general they for when but users issued date considered are sheet statements balance the after statements. financial Events those for consolidated Subsequent Company’s within 20. entities the periods business to interim impact public and material for 2015, a of 15, effective have measurement not December is did the after ASU guidance in beginning This The events years years. assets. fiscal significant fiscal plan for or issued related contributions statements and those financial of obligations effects benefit the retirement reflect the should entity An year-end. nJnay2,21,teCmaydcae ahdvdn f$.8prsae h 00 iiedper dividend $0.08 The share. per $0.08 of dividend cash a declared Company the 2017, 26, January On The with Agreement Termination Mutual a into entering the announced Company the 2017, 24, January On “ 855, ASC FASB in defined As NETR ACR,IC N SUBSIDIARIES AND INC. BANCORP, INVESTORS oe oCnoiae iaca Statements Financial Consolidated to Notes usqetEvents Subsequent 147 ,sbeun vnsaeeet rtascin htoccur that transactions or events are events subsequent ”,

FORM 10-K 148 Notes to Consolidated Financial Statements INVESTORS BANCORP, INC. AND SUBSIDIARIES Cummings(1) Cama(1) Plan(1) Replacement Plan dated December 19, 2016 Replacement Plan dated February 29, 2016 Investors Bank(10) Investors Bank(10) Investors Bank(10) 3.13.2 Certificate of Incorporation of Investors4 Bancorp, Inc.(1) Bylaws of Investors Bancorp, Inc.(1) Form of Common Stock Certificate of Investors Bancorp, Inc.(1) 10.1 Amended10.2 and Restated Employment Agreement Amended between and10.3 Restated Investors Employment Agreement Bancorp, between Investors Inc.10.4 Bancorp, Inc. and Amended and and Domenick Kevin Restated A. Employment Agreement10.5 Investors Bancorp, Inc. Amendment and to Richard Amended S. and Spengler(2) Restated10.6 Employment Agreement with Amended Richard and S. Restated Spengler(3) Employment Agreement10.7 Investors Bancorp, Inc. Amendment and to Paul Amended Kalamaras(4) and Restated10.8 Employment Agreement with Employment Paul Agreement Kalamaras(3) Investors Bancorp, Inc.10.9 and Sean Burke(5) Amendment to Employment Agreement with10.10 Sean Burke(3) Investors Bancorp, Inc. 2015 Equity10.11 Incentive Investors Plan(6) Bancorp, Inc. 2006 Equity Incentive Plan(7) 10.12 Roma Financial Corporation 2008 Equity Incentive Plan(8) 10.13 Investors Bank Executive Officer Annual Incentive Plan(9) 10.14 Investors Bank Amended and restated Supplemental ESOP and Amended Retirement Plan(1) and10.15 Restated Investors Bank Executive Amendment Supplemental to Retirement Amended10.16 Wage and Restated Replacement Investors Bank Amendment Executive to Supplemental Amended Retirement10.17 and Wage Restated Investors Bank10.18 Investors Executive Bank Supplemental Amended and Retirement Restated Director Wage Retirement10.19 Plan(1) Investors Bancorp, Inc. Deferred Directors Fee Plan(1) 10.20 Investors Bank Deferred Directors Fee Plan(1) Split Dollar Life Insurance10.21 Agreement between Roma Bank and Robert Split C. Albanese, Dollar as assumed Life10.22 by Insurance Agreement between Roma Split Dollar Bank Life Insurance and Agreement between Dennis Roma M. Bank and Bone, Michele N. assumed Siekerka, as by assumed by (a)(3) Exhibits The following exhibits are either filed as part of this report or are incorporated herein by reference:

FORM 10-K 1)Icroae yrfrnet h mne eitainSaeeto omS1o Investors of S-1 Form on Statement Registration Amended the Bancorp, to Investors reference for Statement by Proxy Incorporated Definitive the to D Annex to Investors reference of by S-8 Incorporated Form on Statement Registration (10) the to 10.1 Exhibit to reference by Incorporated Bancorp, Investors for Statement Proxy (9) Definitive the to B Appendix to reference by Incorporated Bancorp, Investors Investors for of Statement Proxy (8) 10-K Definitive the Form to on A Appendix Report to reference Annual by Investors Incorporated the of to 8-K 10.5 (7) Form Exhibit on to Report reference Current by the Incorporated to of 10.2 10-Q (6) on Exhibit Report to Quarterly reference the by to Investors Incorporated 10.3 of and 10.2 8-K (5) 10.1, Form Exhibit on to Report reference Current by the Incorporated to 10.1 (4) Exhibit to Inc. reference Bancorp, by Investors Incorporated of S-1 Form on (3) Statement Registration the to reference by Incorporated (2) (1) 0 neatv aaflsprun oRl 0 fRglto -:()teCnoiae aac Sheets, Balance Consolidated the (i) S-T: Regulation of 405 Rule to pursuant files pursuant data Officer Interactive Accounting and Financial Principal and Sarbanes- Officer the Executive 101 of Principal 302 of Section Certification to of pursuant Act Officer Accounting Sarbanes-Oxley and the Financial 32.1 of Principal 302 of Certification Section to pursuant Officer Executive 31.2 Principal of Certification Firm Accounting Public Registered Independent of Consent 31.1 Registrant of Subsidiaries 23.1 21 i)teCnoiae ttmnso noe ii h osldtdSaeet fComprehensive of of statements Statements Statements financial Consolidated these Consolidated to the notes the (v) related Equity, (vi) (iii) Stockholders’ and of Flows, Income, Statements Cash Consolidated of the Statements (iv) Income, Consolidated the (ii) 2002 of Act Sarbanes-Oxley the of 906 Section to 2002 of Act Oxley 2002 acr,Ic Cmiso ien.33126)fldwt h euiisadExchange and Securities the with filed 333-192966) no. 2014. 11, File February the on (Commission Commission with filed Inc. 000-51557) Bancorp, No. Exchange File 2013. 29, (Commission and April on Stockholders Commission Securities Exchange of and Meeting the Securities Annual with 2013 filed Inc.’s 333-192717) No. 2013. 9, File December the on (Commission Commission with filed Inc. 000-51557) Bancorp, No. File 2006. 15, (Commission September on Stockholders Commission Exchange of the and Meeting Securities with Annual filed 2006 001-36441) Inc.’s Exchange No. File 2015. and 30, (Commission April Securities on Stockholders Commission Exchange of the and Meeting Securities with Annual 2015 filed Inc.’s Exchange 001-36441) and No. Securities 2015. File 3, March the on (Commission Commission with Inc. filed Bancorp, 000-51557) No. 2010. File 1, April on (Commission Commission Inc. Bancorp, Exchange Exchange and and Securities the with Securities 2016. filed 10, 001-36441) May the No. on Commission File with (Commission Inc. filed Bancorp, Investors 000-51557) No. 2010. File 1, April on (Commission Commission Inc. Bancorp, Commission Exchange and Securities 2013. the 20, with December filed on originally 333-192966), no. File (Commission NETR ACR,IC N SUBSIDIARIES AND INC. BANCORP, INVESTORS oe oCnoiae iaca Statements Financial Consolidated to Notes 149

FORM 10-K 150 Notes to Consolidated Financial Statements INVESTORS BANCORP, INC. AND SUBSIDIARIES FORM 10-K SUMMARY None. ITEM 16.

FORM 10-K olwn esn nbhl fteRgsrn n ntecpcte n ntedtsindicated. dates the on and capacities the in and Registrant the of behalf on persons following ae Garibaldi James Garibaldi James /s/ Dittenhafer D. Brian Dittenhafer D. Brian /s/ Cosgrove William Cosgrove William /s/ Byrnes R. Doreen Byrnes R. Doreen /s/ Bone M. Dennis Bone M. Dennis /s/ Albanese C. Robert Albanese C. Robert /s/ Cashill M. Robert Cashill M. Robert /s/ Burke Sean Burke Sean /s/ Cama Domenick Cama Domenick /s/ Cummings Kevin Cummings Kevin /s/ 2017 1, March Date: authorized. duly thereunto undersigned, the by behalf its on signed be to report this caused duly has usatt h eurmnso h euiisEcag f13,ti eothsbe indblwb the by below signed been has report this 1934, of Exchange Securities the of requirements the to Pursuant usatt h eurmnso eto 3o 5d fteScrte xhneAto 94 h Registrant the 1934, of Act Exchange Securities the of 15(d) or 13 Section of requirements the to Pursuant Signatures SIGNATURES he xctv fie n President and Officer Executive Chief n eirEeuieVc President Vice Executive Senior and PicplFnniladAccounting and Financial (Principal 151 ietr he prtn Officer Operating Chief Director, By: PicplEeuieOfficer) Executive (Principal he iaca fie and Officer Financial Chief Dl uhrzdRepresentative) Authorized (Duly Officer) Executive (Principal President and Officer Executive Chief Cummings Kevin s ei Cummings Kevin /s/ NETR ACR,INC. BANCORP, INVESTORS eirVc President Vice Senior ietr himnMrh1 2017 1, March Chairman Director, Director, ietrMrh1 2017 1, March 2017 1, March 2017 1, March Director 2017 1, March Director 2017 1, March Director 2017 1, March Director Director Director Officer) Title ac ,2017 1, March 2017 1, March ac ,2017 1, March Date

FORM 10-K Date Title DirectorDirector March 1, 2017 March 1, 2017 152 Signatures /s/ James H. Ward III James H. Ward III /s/ Michele N. Siekerka Michele N. Siekerka

FORM 10-K

101 JFK Parkway Short Hills, New Jersey 07078

April 13, 2017

Dear Fellow Stockholder:

You are cordially invited to attend the 2017 Annual Meeting of Stockholders of Investors Bancorp, Inc., which will be held at The Grand Summit Hotel, 570 Springfield Avenue, Summit, New Jersey 07901, on May 23, 2017, at 9:00 a.m., local time.

The business to be conducted at the Annual Meeting consists of the election of four directors, an advisory (non-binding) vote to approve the compensation paid to our Named Executive Officers and the ratification of the appointment of KPMG LLP as our independent registered public accounting firm for the year ending December 31, 2017. Your Board of Directors has determined that an affirmative vote on each of these matters is in the best interests of Investors Bancorp, Inc. and its stockholders and unanimously recommends a vote “FOR” the election of each of the nominees for director, “FOR” approval on an advisory basis of executive compensation and “FOR” ratification of the appointment of KPMG LLP as our independent registered public accounting firm for the year ending December 31, 2017.

Your vote is very important. Whether or not you plan to attend the Annual Meeting, please promptly submit your vote by Internet, telephone or mail, as applicable, to ensure that your shares are represented at the Annual Meeting.

On behalf of the Board of Directors, officers and employees of Investors Bancorp, Inc., we thank you for your continued support.

Sincerely,

Kevin Cummings President and Chief Executive Officer PROXY STATEMENT

Investors Bancorp, Inc.

101 JFK Parkway Short Hills, New Jersey 07078 (973) 924-5100

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS To Be Held on May 23, 2017

NOTICE IS HEREBY GIVEN THAT the 2017 Annual Meeting of Stockholders of Investors Bancorp, Inc. will be held at The Grand Summit Hotel, 570 Springfield Avenue, Summit, New Jersey 07901, on May 23, 2017, at 9:00 a.m., local time, to consider and vote upon the following matters: 1. The election of four persons to serve as directors of Investors Bancorp, Inc., each for a three-year term, and until their successors are elected and qualified. 2. An advisory (non-binding) vote to approve the compensation paid to our Named Executive Officers. 3. The ratification of the appointment of KPMG LLP as the independent registered public accounting firm for Investors Bancorp, Inc. for the year ending December 31, 2017. 4. The transaction of such other business as may properly come before the Annual Meeting, and any adjournment or postponement of the Annual Meeting.

The Board of Directors of Investors Bancorp, Inc. has fixed March 27, 2017 as the record date for determining the stockholders entitled to vote at the Annual Meeting and any adjournment or postponement of the Annual Meeting. Only stockholders of record at the close of business on that date are entitled to notice of and to vote at the Annual Meeting and any adjournment or postponement of the Annual Meeting.

The Board of Directors unanimously recommends that you vote “FOR” each of the nominees for director listed in the Proxy Statement, “FOR” approval on an advisory basis of executive compensation and “FOR” the ratification of the appointment of KPMG LLP as the independent registered public accounting firm for the year RX STATEMENT PROXY ending December 31, 2017.

Whether or not you plan to attend the Annual Meeting, please promptly submit your vote by Internet, telephone or mail, as applicable, to ensure that your shares are represented at the Annual Meeting.

By Order of the Board of Directors Investors Bancorp, Inc.

Brian F. Doran, Esq. Short Hills, New Jersey Corporate Secretary April 13, 2017

Internet Availability of Proxy Materials We are relying upon a U.S. Securities and Exchange Commission rule that allows us to furnish proxy materials to stockholders over the Internet. As a result, beginning on or about April 13, 2017, we sent by mail a Notice Regarding the Availability of Proxy Materials containing instructions on how to access our proxy materials, including our Proxy Statement and Annual Report to Stockholders, over the Internet and how to vote. Internet availability of our proxy materials is designed to expedite receipt by stockholders and lower the cost and environmental impact of our Annual Meeting. However, if you received such a notice and would prefer to receive paper copies of our proxy materials, please follow the instructions included in the Notice Regarding the Availability of Proxy Materials.

If you hold our common stock through more than one account, you may receive multiple copies of these proxy materials and will have to follow the instructions for each in order to vote all of your shares of our common stock.

Our Proxy Statement and 2016 Annual Report to Stockholders are available at www.proxydocs.com/ISBC. PROXY STATEMENT

Table of Contents

General Information...... 1 Annual Meeting of Stockholders...... 1 Who Can Vote ...... 1 How Many Votes You Have...... 2 Matters to Be Considered ...... 2 How to Vote...... 2 Participants in Investors Bancorp Benefit Plans...... 2 Quorum and Vote Required...... 3 Revocability of Proxies...... 3 Solicitation of Proxies...... 3 Recommendation of the Board of Directors...... 4 Security Ownership of Certain Beneficial Owners and Management...... 4 Proposal I–Election of Directors...... 6 General...... 6 Directors and Executive Officers of Investors Bancorp...... 6 Corporate Governance Matters...... 15 Risk Oversight Matters...... 22 Audit Committee Matters ...... 23 Compensation and Benefits Committee Matters ...... 25 Compensation Discussion and Analysis...... 26 Executive Compensation ...... 51 Summary Compensation Table...... 51 All Other Compensation...... 52 Perquisites...... 52

RX STATEMENT PROXY Grants of Plan-Based Awards...... 53 Outstanding Equity Awards...... 53 Option Exercises and Stock Vested...... 54 Pension Benefits ...... 54 Nonqualified Deferred Compensation...... 55 Potential Payments Upon Termination or Change in Control ...... 55 Director Compensation ...... 56 Directors’ Compensation Table...... 59 Proposal II–Advisory Vote to Approve Executive Compensation ...... 61 Proposal III–Ratification of the Appointment of the Independent Registered Public Accounting Firm ...... 62 Other Matters...... 63 Stockholder Proposals ...... 63 Advance Notice of Business to be Conducted at an Annual Meeting...... 63

i General Information The Board of Directors of Investors Bancorp, Inc. (“Investors Bancorp” or the “Company”) is soliciting proxies for our 2017 Annual Meeting of Stockholders, and any adjournment or postponement of the meeting (“Annual Meeting”). The Annual Meeting will be held on May 23, 2017 at 9:00 a.m., local time, at The Grand Summit Hotel, 570 Springfield Avenue, Summit, New Jersey.

A Notice Regarding the Availability of Proxy Materials is first being sent to stockholders of Investors Bancorp on or about April 13, 2017.

The 2017 Annual Meeting of Stockholders

Date, Time and Place The Annual Meeting of Stockholders will be held at The Grand Summit Hotel, 570 Springfield Avenue, Summit, New Jersey 07901, on May 23, 2017, at 9:00 a.m., local time. Record Date March 27, 2017 Shares Entitled to Vote 310,353,472 shares of Investors Bancorp common stock were outstanding on the Record Date and are entitled to vote at the Annual Meeting. Purpose of the Annual Meeting To consider and vote on the election of four directors, the approval of the compensation paid to our Named Executive Officers and the ratification of KPMG LLP as our independent registered public accounting firm for the year ending December 31, 2017. Vote Required Subject to the Board’s majority voting policy described below, directors are elected by a plurality of votes cast, without regard to either broker non-votes or proxies as to which authority to vote for the nominees being proposed is “WITHHELD”. The advisory vote to approve executive compensation and the ratification of KPMG LLP as the independent registered public accounting firm is determined by a majority of the votes cast, without regard to broker non-votes or proxies marked “ABSTAIN.” Your Board of Directors Your Board of Directors unanimously recommends that stockholders vote Recommends You Vote in “FOR” each of the nominees for director listed in this Proxy Statement, Favor of the Proposals “FOR” approval (on an advisory non-binding basis) of the compensation paid to our named executive officers and “FOR” the ratification of KPMG LLP as Investors Bancorp’s independent registered public accounting firm for the year ending December 31, 2017.

Investors Bancorp Investors Bancorp, a Delaware corporation, is the bank holding company for PROXY STATEMENT Investors Bank, a FDIC-insured, New Jersey-chartered capital stock savings bank. Investors Bancorp had $23.17 billion in total assets and 151 full-service banking offices in New Jersey and New York at December 31, 2016. Investors Bancorp’s principal executive offices are located at 101 JFK Parkway, Short Hills, New Jersey 07078, and our telephone number is (973) 924-5100.

Who Can Vote The Board of Directors has fixed March 27, 2017 as the record date for determining the stockholders entitled to receive notice of and to vote at the Annual Meeting. Accordingly, only holders of record of shares of Investors Bancorp common stock, par value $0.01 per share, at the close of business on such date will be entitled to vote at the Annual Meeting. On March 27, 2017, 310,353,472 shares of Investors Bancorp common stock were outstanding and held by approximately 17,500 holders of record. The presence, in person or by

1 properly executed proxy, of the holders of a majority of the outstanding shares of Investors Bancorp common stock is necessary to constitute a quorum at the Annual Meeting.

How Many Votes You Have Each holder of shares of Investors Bancorp common stock outstanding on March 27, 2017 will be entitled to one vote for each share held of record. However, Investors Bancorp’s certificate of incorporation provides that stockholders of record who beneficially own in excess of 10% of the then outstanding shares of common stock of Investors Bancorp are not entitled to vote any of the shares held in excess of that 10% limit. A person or entity is deemed to beneficially own shares that are owned by an affiliate of, as well as by any person acting in concert with, such person or entity.

Matters to Be Considered The purpose of the Annual Meeting is to elect four directors, to approve the compensation paid to our Named Executive Officers on an advisory (non-binding) basis and to ratify the appointment of KPMG LLP as Investors Bancorp’s independent registered public accounting firm for the year ending December 31, 2017.

You may be asked to vote upon other matters that may properly be submitted to a vote at the Annual Meeting. We may adjourn or postpone the Annual Meeting for the purpose, among others, of allowing additional time to solicit proxies.

How to Vote You may vote your shares:  In person at the Annual Meeting. All stockholders of record may vote in person at the Annual Meeting. Beneficial owners may vote in person if they have a legal proxy from their bank or broker.  By telephone or Internet (see the instructions at www.proxydocs.com/ISBC). Beneficial owners may also vote by telephone or Internet if their bank or broker makes those methods available, in RX STATEMENT PROXY which case the bank or broker will include the instructions with the proxy materials.  By written proxy. All stockholders of record can vote by written proxy card. If you received a printed copy of this Proxy Statement, you may vote by signing, dating and mailing the enclosed Proxy Card, or if you are a beneficial owner, you may request a voting instruction form from your bank or broker.

If you return an executed Proxy Card without marking your instructions, your executed Proxy Card will be voted “FOR” the election of the four nominees for director, “FOR” approval of the executive compensation paid to our named executive officers and “FOR” the ratification of the appointment of KPMG LLP as our independent registered public accounting firm for the year ending December 31, 2017.

Participants in Investors Bancorp Benefit Plans If you are a participant in our Employee Stock Ownership Plan or 401(k) Plan, or any other benefit plans sponsored by us through which you own shares of our common stock, you will have received a Notice Regarding the Availability of Proxy Materials. Under the terms of these plans, the trustee or administrator votes all shares held by the plan, but each participant may direct the trustee or administrator how to vote the shares of our common stock allocated to his or her plan account. If you own shares through any of these plans and you do not vote by May 18, 2017, the respective plan trustees or administrators will vote your shares in accordance with the terms of the respective plans.

2 Quorum and Vote Required The presence, in person or by properly executed proxy, of the holders of a majority of the outstanding shares of Investors Bancorp common stock is necessary to constitute a quorum at the Annual Meeting. Abstentions and broker non-votes will be counted solely for the purpose of determining whether a quorum is present. A proxy submitted by a broker that is not voted on certain matters is sometimes referred to as a broker non-vote.

Directors are elected by a plurality of votes cast, without regard to either broker non-votes or proxies as to which authority to vote for the nominees being proposed is “WITHHELD”. However, any nominee for director in an uncontested election who receives a greater number of votes “WITHHELD” from his or her election than votes “FOR” such election shall tender his or her resignation for consideration by the Nominating and Corporate Governance Committee of the Board. The Committee shall recommend to the Board the action to be taken with respect to the resignation. Any Director who tenders his or her resignation pursuant to this provision shall not participate in the Committee's or the Board's deliberations as to whether to accept the resignation. Should this situation occur, the Board would publicly disclose its decision within 90 days of the certification of the election results. The advisory vote to approve the executive compensation paid to our Named Executive Officers and the ratification of the appointment of KPMG LLP as the independent registered public accounting firm is determined by a majority of the votes cast, without regard to broker non-votes or proxies marked “ABSTAIN”.

Revocability of Proxies You may revoke your proxy at any time before the vote is taken at the Annual Meeting. You may revoke your proxy by:  submitting written notice of revocation to the Corporate Secretary of Investors Bancorp prior to the voting of such proxy;  submitting a properly executed proxy bearing a later date;  voting again by telephone or Internet (provided such vote is received on a timely basis); or  voting in person at the Annual Meeting; however, simply attending the Annual Meeting without voting will not revoke an earlier proxy.

Written notices of revocation and other communications regarding the revocation of your proxy should be addressed to: Investors Bancorp, Inc. 101 JFK Parkway Short Hills, New Jersey 07078 Attention: Brian F. Doran, Esq., Corporate Secretary PROXY STATEMENT

If your shares are held in street name, you should follow your broker’s instructions regarding the revocation of proxies.

Solicitation of Proxies Investors Bancorp will bear the entire cost of soliciting proxies. In addition to solicitation of proxies by mail, Investors Bancorp will request that banks, brokers and other holders of record send proxies and proxy material to the beneficial owners of Investors Bancorp common stock and secure their voting instructions, if necessary. Investors Bancorp will reimburse such holders of record for their reasonable expenses in taking those actions. Laurel Hill Advisory Group, LLC will assist us in soliciting proxies and we have agreed to pay them a fee of $7,000 plus reasonable expenses for their services. If necessary, Investors Bancorp may also use several of its regular employees, who will not be specially compensated, to solicit proxies from stockholders, personally

3 or by telephone, facsimile or letter. In the event there are not sufficient votes for a quorum, or to approve or ratify any matter being presented at the time of this Annual Meeting, the Annual Meeting may be adjourned in order to permit the further solicitation of proxies.

Recommendation of the Board of Directors Your Board of Directors unanimously recommends that you vote “FOR” each of the nominees for director listed in this Proxy Statement, “FOR” approval on a non-binding advisory basis of the executive compensation paid to our Named Executive Officers and “FOR” the ratification of KPMG LLP as Investors Bancorp’s independent registered public accounting firm for the year ending December 31, 2017.

Security Ownership of Certain Beneficial Owners and Management Persons and groups who beneficially own in excess of five percent of Investors Bancorp’s common stock are required to file certain reports with the Securities and Exchange Commission (“SEC”) regarding such beneficial ownership. The following table sets forth, as of March 27, 2017, certain information as to the shares of Investors Bancorp common stock owned by persons who beneficially own more than five percent of Investors Bancorp’s issued and outstanding shares of common stock. We know of no persons, except as listed below, who beneficially owned more than five percent of the outstanding shares of Investors Bancorp common stock as of March 27, 2017. For purposes of the following table and the table included under the heading “Directors and Executive Officers,” and in accordance with Rule 13d-3 under the Securities Exchange Act of 1934, as amended, a person is deemed to be the beneficial owner of any shares of common stock (i) over which he or she has, or shares, directly or indirectly, voting or investment power, or (ii) as to which he or she has the right to acquire beneficial ownership at any time within 60 days after March 27, 2017.

Principal Stockholders

Number of Shares Owned Percent of Shares of and Nature of Beneficial Common Name and Address of Beneficial Owner Ownership Stock Outstanding (1) RX STATEMENT PROXY Blue Harbour Group, LP 646 Steamboat Road Greenwich, CT 06830 29,582,428 (2) 9.53% FMR LLC 245 Summer Street Boston, MA 02210 25,421,986 (3) 8.19% The Vanguard Group 100 Vanguard Blvd. Malvern, PA 19355 23,186,583 (4) 7.47% BlackRock, Inc. 55 East 52nd Street New York, NY 10055 19,353,798 (5) 6.24% Fuller & Thaler Asset Management, Inc. 411 Borel Avenue, Suite 300 San Mateo, CA 94402 19,352,150 (6) 6.24% Investors Bank Employee Stock Ownership Plan Trust Trustee: First Bankers Trust Services, Inc. 2321 Kochs Lane Quincy, IL 62305 16,350,086 (7) 5.27%

(1) Based on 310,353,472 shares of Investors Bancorp common stock outstanding as of March 27, 2017. (2) Based on a Form 13F-HR filed with the SEC on February 14, 2017. (3) Based on a Schedule 13G/A filed with the SEC on February 14, 2017. (4) Based on a Schedule 13G/A filed with the SEC on February 10, 2017.

4 (5) Based on a Schedule 13G/A filed with the SEC on January 25, 2017. (6) Based on a Schedule 13G filed with the SEC on February 23, 2017. (7) Based on a Schedule 13G filed with the SEC on February 14, 2017.

Directors and Executive Officers The following table sets forth information about shares of Investors Bancorp common stock owned by each nominee for election as director, each incumbent director, each Named Executive Officer identified in the summary compensation table included elsewhere in this Proxy Statement, and all nominees, incumbent directors and executive officers as a group, as of March 27, 2017.

Unvested Stock Position(s) held with Shares Owned Options Awards Included Investors Bancorp Directly and Exercisable Beneficial Percent in Beneficial Name Inc. and/or Investors Bank Indirectly (1) within 60 days Ownership of Class Ownership NOMINEES Dennis M. Bone Director 172,744 50,000 222,744 * 80,000 Doreen R. Byrnes Director 202,638 50,000 252,638 * 80,000 Peter H. Carlin Director — — — * — William V. Cosgrove Director 157,450 150,000 307,450 * 80,000 INCUMBENT DIRECTORS Robert M. Cashill Chairman 781,902 83,333 865,235 * 100,000 Kevin Cummings Director, President and 1,879,860 190,476 2,070,336 * 642,857 Chief Executive Officer Brian D. Dittenhafer Lead Director 366,557 83,333 449,890 * 100,000 Michele N. Siekerka Director 182,268 120,606 302,874 * 80,000 Robert C. Albanese Director 171,988 85,302 257,290 * 80,000 Domenick A. Cama Director, Senior Executive 1,445,320 152,380 1,597,700 * 514,286 Vice President and Chief Operating Officer James J. Garibaldi Director 101,550 50,000 151,550 * 80,000 James H. Ward III Director 445,969 50,000 495,969 * 80,000 EXECUTIVE OFFICERS WHO ARE NOT DIRECTORS Richard S. Spengler Executive Vice 745,947 101,904 847,851 * 402,857 President and Chief Lending Officer Paul Kalamaras Executive Vice President 798,425 101,904 900,329 * 402,857 and Chief Retail Banking Officer Sean Burke Senior Vice 369,250 89,523 458,773 * 340,000 PROXY STATEMENT President and Chief Financial Officer (2) All directors and executive officers as a group 7,821,868 1,358,761 9,180,629 2.96% 3,062,857

* Less than 1% (1) Unless otherwise indicated, each person effectively exercises sole, or shared with spouse, voting and dispositive power as to the shares reported. (2) Includes 122,157 shares of common stock allocated to the accounts of executive officers under the Investors Bank Employee Stock Ownership Plan (“ESOP”) and excludes the remaining 17,343,147 shares of common stock of which 12,789,847 are unallocated and held for the future benefit of all employee participants. Under the terms of the ESOP, shares of common stock allocated to the account of employees are voted in accordance with the instructions of the respective employees. Unallocated shares are voted by the ESOP Trustee in the same proportion as the vote obtained from participants on allocated shares. Includes 52,924 shares of common stock held through the Company's 401(k) Plan.

On December 18, 2016, Brendan J. Dugan, who had served on the Boards of Directors of Investors Bancorp and Investors Bank since 2013, passed away.

5 Proposal I–Election of Directors General Investors Bancorp’s Board of Directors currently consists of 12 members and is divided into three classes, with one class of directors elected each year. Each of the 12 members of the Board of Directors also serves as a director of Investors Bank. The current Bylaws of Investors Bancorp provide that a director shall retire from the Board at the annual meeting of the Board immediately following the year in which the director attains age 75.

Four directors will be elected at the Annual Meeting. On the recommendation of the Nominating and Corporate Governance Committee, the Board of Directors has nominated Dennis Bone, Doreen Byrnes, Peter Carlin and William Cosgrove for election as directors, each of whom has agreed to serve if so elected. All will serve until their respective successors have been elected and qualified.

Except as disclosed in this Proxy Statement, there are no arrangements or understandings between any nominee and any other person pursuant to which any such nominee was selected. Unless authority to vote for the nominees is withheld, it is intended that the shares represented by your Proxy Card, if executed and returned, will be voted “FOR” the election of all nominees.

In the event that any nominee is unable or declines to serve, the persons named in the Proxy Card as proxies will vote with respect to a substitute nominee designated by Investors Bancorp’s current Board of Directors. At this time, the Board of Directors knows of no reason why any of the nominees would be unable or would decline to serve, if elected.

Investors Bancorp’s Board of Directors recommends a vote “FOR” the election of the nominees for Director named in this proxy statement.

Directors and Executive Officers of Investors Bancorp The following table states our directors’ names, their ages as of March 27, 2017, and the years when they began serving as directors of Investors Bancorp and when their current term expires. RX STATEMENT PROXY Position(s) Held With Director Current Term Name Investors Bancorp Age Since Expires NOMINEES Dennis M. Bone Director 65 2013 2017 Doreen R. Byrnes Director 67 2002 2017 Peter H. Carlin (1) Director 44 2017 2020 William V. Cosgrove Director 69 2011 2017 INCUMBENT DIRECTORS Robert M. Cashill Chairman 74 1998 2018 Kevin Cummings Director, President and 62 2008 2018 Chief Executive Officer Brian D. Dittenhafer Lead Director 74 1997 2018 Michele N. Siekerka Director 52 2013 2018 Robert C. Albanese Director 69 2013 2019 Domenick A. Cama Director, Senior Executive 60 2011 2019 Vice President and Chief Operating Officer James J. Garibaldi Director 65 2012 2019 James H. Ward III Director 68 2009 2019

(1) Effective March 27, 2017, the Company appointed Peter H. Carlin to the Board of Directors for a three year term.

6 The following information describes the business experience for each of Investors Bancorp's directors and executive officers.

Nominees for Director Term to Expire 2020

Dennis M. Bone was appointed to the Board of Directors of Investors Bancorp and Investors Bank on December 6, 2013 upon the consummation of Investors Bancorp’s acquisition of Roma Financial Corporation, where he served as a director. Mr. Bone is the Director of the Feliciano Center for Entrepreneurship at Montclair State University. Previously, Mr. Bone served as President of Verizon New Jersey for 12 years where he was responsible for Verizon’s corporate interests across New Jersey. Mr. Bone had over 33 years’ experience with Verizon, where he served in executive management positions for 17 years. Active in his community, Mr. Bone is on the Board of Trustees of the New Jersey Institute of Technology where he is Chairman of the Audit & Finance Committee, the New Jersey Center for Teaching and Learning, the Citizens Campaign and was recently elected Chairman of the Newark Alliance. In addition, Mr. Bone is Chairman of the New Jersey State Employment and Training Commission which oversees New Jersey’s Workforce System, and was the founding Chairman of Choose New Jersey. Mr. Bone previously served on the Board of Trustees of the Liberty Science Center (12 years), the Board of Directors of the New Jersey Performing Arts Center (12 years), the Aviation Research Technology Park (2 years), and the New Jersey Utilities Association (12 years).

The Nominating and Corporate Governance Committee believes that Mr. Bone's experience, which brings a broader corporate perspective, and his extensive community involvement to be assets to the Board of Directors.

Doreen R. Byrnes was elected to the Board of Directors of Investors Bancorp and Investors Bank in January 2002. Ms. Byrnes retired in 2007 after an employment career in the area of human resources, including having served as Executive Vice President of Human Resources of Investors Bancorp. Ms. Byrnes has a Bachelor’s degree from the University of Florida and a Master’s degree from PROXY STATEMENT Fairleigh Dickinson University. She is a member of National Association of Corporate Directors and was awarded the Certificate of Director Education in 2010.

Ms. Byrnes has extensive experience with executive recruitment, retention and compensation as well as a strong understanding of the employees and markets served by Investors Bank. This experience provides a unique perspective to the Board of Directors. The Nominating and Corporate Governance Committee considers Ms. Byrnes’ skills and experience to be assets to the Board of Directors.

7 Peter H. Carlin was appointed to the Board of Directors of Investors Bancorp and Investors Bank on March 27, 2017. Mr. Carlin has been a Managing Director at Blue Harbour Group since 2014. Prior to joining Blue Harbour Group, Mr. Carlin was a Managing Member of Estekene Capital from 2009 to 2013. Previously, he was a Deputy Portfolio Manager at Alson Capital, where he worked from 2002 to 2009 and at Sanford Bernstein & Co. where he was a Buyside Research Analyst from 2000 to 2002. Mr. Carlin began his career at Morgan Stanley in the Mergers & Acquisitions Group. Mr. Carlin earned his MBA from Columbia Business School in 1999, a JD from Columbia Law School in 1999, and a BA from the University of Pennsylvania in 1994.

Mr. Carlin’s tenure working with financial institutions through the capital markets brings valuable expertise to the Board of Directors. Mr. Carlin’s financial and leadership skills and experience and knowledge, as well as the representation of shareholder interest bring an important asset to the Board of Directors.

William V. Cosgrove was first appointed to the Board of Directors of Investors Bancorp and Investors Bank in October 2011. Mr. Cosgrove had been employed as a non Section 16 officer of Investors Bank since Investors Bancorp’s acquisition of Summit Federal Bankshares, Inc. and Summit Federal Savings Bank in June 2008 through his retirement from Investors Bank on October 1, 2011. Mr. Cosgrove was President and Chief Executive Officer of Summit Federal Savings Bank from 2003 until the acquisition of Summit Federal Savings Bank by Investors Bank. Mr. Cosgrove has over 40 years of experience in banking and has served as president of the N.J. Council of Federal Savings Institutions, and the Union County Savings League. In addition he served on the Board of Governors of the RX STATEMENT PROXY New Jersey Savings League. Mr. Cosgrove is a member of the National Association of Corporate Directors, where he continues his education.

Mr. Cosgrove’s extensive experience in the banking industry and local markets bring valuable expertise to the Board of Directors. The Nominating and Corporate Governance Committee considers Mr. Cosgrove’s financial and leadership skills and his experience and knowledge of the financial services industry in general to be assets to the Board of Directors.

8 Continuing Directors Term to Expire 2018

Robert M. Cashill was first elected to the Board of Directors of Investors Bancorp and Investors Bank in February 1998 and has served as Chairman since January 2010. Mr. Cashill served as President and Chief Executive Officer of Investors Bank from December 2002 until his retirement on December 31, 2007. During this time Mr. Cashill was an integral part of the conversion of the former savings bank into the mutual holding company structure raising $500 million in the process. Prior to joining Investors Bank, Mr. Cashill was employed as Vice President Institutional Sales by Salomon Smith Barney from 1977 to 1998, and at Hornblower, Weeks, Hemphill, Noyes from 1966 to 1977. For much of that time he specialized in providing investment analysis and asset/liability management advice to thrift institutions and was, therefore, familiar with thrift recapitalizations and debt issuance. Mr. Cashill has a Bachelor of Science degree in Economics from Saint Peter’s College. He is a member of the National Association of Corporate Directors, where he continues his education and served on the boards of both the New Jersey League of Savings Institutions and the Paper Mill Playhouse.

Mr. Cashill’s leadership skills, extensive background in the financial services industry and his experience working for Investors Bank brings knowledge of industry management and local markets to the Board of Directors. The Nominating and Corporate Governance Committee considers Mr. Cashill’s financial and leadership skills and his experience and knowledge of the financial services industry in general and of Investors Bancorp in particular to be significant assets for the Board of Directors.

Kevin Cummings was appointed President and Chief Executive Officer of Investors Bancorp and Investors Bank effective January 1, 2008 and was also appointed to serve on the Board of Directors of Investors Bank at that time. He previously served as Executive Vice President and Chief Operating Officer of Investors Bank since July 2003. Prior to joining Investors Bank, Mr. Cummings had a 26-year career with the independent accounting firm of KPMG LLP, where he

had been partner for 14 years. Immediately prior to joining Investors PROXY STATEMENT Bank, he was an audit partner in KPMG’s Financial Services practice in their New York City office and lead partner on a major commercial banking client. Mr. Cummings also worked in the New Jersey community bank practice for over 20 years. Mr. Cummings has a Bachelor’s degree in Economics from Middlebury College and a Master’s degree in Business Administration from Rutgers University. He is the former Chairman of the Board of the New Jersey Bankers Association and sits on the Board of Trustees of the Scholarship Fund for Inner-City Children and Liberty Science Center and is also a member of the Development Leadership Council of Morris Habitat for Humanity. In addition, Mr. Cummings is a member of the Board of the Federal Home Loan Bank of New York, the Independent College Fund of New Jersey, the All Stars Project of New Jersey and the Community Foundation of New Jersey.

9 Mr. Cummings is a certified public accountant and his background in public accounting enhances the board of directors’ oversight of financial reporting and disclosure issues. The Nominating and Corporate Governance Committee considers Mr. Cummings’ leadership skills and knowledge of accounting, auditing and corporate governance in the financial services industry to be assets to the Board of Directors.

Brian D. Dittenhafer was first elected to the Board of Directors of Investors Bancorp and Investors Bank in 1997. He served as President and Chief Executive Officer of the Federal Home Loan Bank of New York from 1985 until his retirement in 1992. Mr. Dittenhafer joined the FHLB in 1976 where he also served as Vice President and Chief Economist, Chief Financial Officer and Executive Vice President. Previously, he was employed as a Business Economist at the Federal Reserve Bank of Atlanta from 1971 to 1976. From 1992 to 1995, Mr. Dittenhafer served as President and Chief Financial Officer of Collective Federal Savings Bank and as Chairman of the Resolution Funding Corporation from 1989 to 1992. From 1995 to 2007 Mr. Dittenhafer was Chairman of MBD Management Company. Mr. Dittenhafer has a Bachelor of Arts from Ursinus College and a Master of Arts in Economics from Temple University where he subsequently taught economics. He was named to Omicron Delta Epsilon, the national honor society in Economics. Mr. Dittenhafer is a member of the National Association for Business Economics and the National Association of Corporate Directors. In 2007 he was awarded the Certificate of Director Education by the National Association of Corporate Directors, where he continues his education and has achieved Director Professional designation. In 2012, Mr. Dittenhafer achieved the status of the National Association of Corporate Directors

RX STATEMENT PROXY Governance Fellow.

Mr. Dittenhafer brings extensive knowledge of the banking industry and a strong background in economics to the Board of Directors. The Nominating and Corporate Governance Committee considers Mr. Dittenhafer’s experience, leadership, financial expertise and strong economics background to be unique assets for the Board of Directors.

10 Michele N. Siekerka was appointed to the Board of Directors of Investors Bancorp and Investors Bank on December 6, 2013 upon the consummation of Investors Bancorp’s acquisition of Roma Financial Corporation where she served as Chairman. Ms. Siekerka is a licensed attorney and President and CEO of New Jersey Business and Industry Association. From 2010 to 2014, Ms. Siekerka was employed by the New Jersey Department of Environmental Protection, first as an Assistant Commissioner and then she completed her service as Deputy Commissioner. From 2004 to 2010, she served as the President and Chief Executive Officer of the Mercer Regional Chamber of Commerce. From 2000 to 2004, Ms. Siekerka was employed by AAA Mid-Atlantic, first as vice president of human resources and then as senior counsel. Active in numerous civic/professional organizations, Ms. Siekerka is on the Board of Choose New Jersey, New Jersey Innovation Institute, Junior Achievement of New Jersey, Better Choices Better Care and Opportunity New Jersey where she serves as Co- Founder and Co-Chairman. Ms. Siekerka is a former member of the Robbinsville Township Board of Education where she served as President from 2002 to 2005.

The Nominating and Corporate Governance Committee considers Ms. Siekerka’s legal and government affairs expertise and market knowledge to be assets to the Board of Directors. PROXY STATEMENT

11 Term to Expire 2019

Robert C. Albanese was appointed to the Board of Directors of Investors Bancorp and Investors Bank on December 6, 2013 upon the consummation of Investors Bancorp’s acquisition of Roma Financial Corporation, where he served as a director. He was the President and Chief Executive Officer of Pentegra Retirement Services, located in White Plains, New York, from 2007 to 2013 following an eleven year tenure on Pentegra’s Board of Directors. Prior to his employment with Pentegra, he served as Regional Director of the Northeast Region of the Office of Thrift Supervision from 1996 through 2007 where he was directly responsible for the oversight of all federally chartered institutions and their holding companies located in the twelve states comprising the Northeast Region. Prior to 1996, he served in various other capacities with the Office of Thrift Supervision and its predecessor, the Federal Home Loan Bank Board.

Mr. Albanese has also been involved in many civic activities, most prominently as past President and Treasurer of the Waldwick, New Jersey Jaycees. He presently sits on the Board of Trustees of the Bridge Academy, a school for children with learning disabilities located in Lawrenceville, New Jersey. The Nominating and Corporate Governance Committee considers Mr. Albanese's extensive regulatory experience with particular expertise in financial analysis, enterprise risk analysis and audit to be assets to the Board of Directors.

Domenick A. Cama was appointed to the Board of Directors of Investors Bancorp and Investors Bank in January 2011. He became Chief Operating Officer of Investors Bank effective January 1, 2008 and was appointed Senior Executive Vice President in January of 2010. Prior to this appointment, Mr. Cama had served as Chief Financial RX STATEMENT PROXY Officer since April 2003. Prior to joining Investors Bank, Mr. Cama was employed for 13 years by the FHLB where he served as Vice President and Director of Sales. Mr. Cama is also a member of the Board of Directors for the Raritan Bay Medical Center Foundation and the Madison YMCA. Mr. Cama holds a Bachelor’s degree in Economics and a Master’s degree in Finance from Pace University.

Mr. Cama has extensive knowledge of the banking industry and local markets served by Investors Bank. The Nominating and Corporate Governance Committee considers Mr. Cama’s experience, leadership, financial expertise and strong economics background to be unique assets for the Board of Directors.

12 James J. Garibaldi was appointed to the Board of Directors of Investors Bancorp and Investors Bank in 2012. He is currently the Chief Executive Officer of The Garibaldi Group, a corporate real estate services firm headquartered in Chatham, New Jersey. Mr. Garibaldi joined The Garibaldi Group in 1974. In 1986, Mr. Garibaldi assumed the role of managing partner of the firm and in 1997 he became its Chief Executive Officer. Mr. Garibaldi formerly served as President of CORFAC International. He is also a member of the Board of Trustees of Big Brothers and Big Sisters of North Jersey, a member of the Advisory Board for the Community Soup Kitchen in Morristown and a former member of the Board of Trustees for the Cancer Hope Network as well as the Finance Council for the Diocese of Paterson. Mr. Garibaldi has a Bachelor of Science degree from the University of Scranton.

Mr. Garibaldi’s extensive real estate experience and knowledge of the local real estate market bring valuable expertise to the Board of Directors. The Nominating and Corporate Governance Committee considers Mr. Garibaldi’s leadership skills and real estate knowledge to be assets to the Board of Directors.

James H. Ward III was appointed to the Board of Directors of Investors Bancorp and Investors Bank in June 2009 upon consummation of Investors Bancorp’s acquisition of American Bancorp of New Jersey, Inc. From 1998 to 2000, he was the majority stockholder and Chief Operating Officer of Rylyn Group, which operated a restaurant in Indianapolis, Indiana. Prior to that, he was the majority stockholder and Chief Operating Officer of Ward and Company, an insurance agency in Springfield, New Jersey, where he was employed from 1968 to 1998. He is now a retired investor. In 2009 he was awarded the Certificate of Director Education by the National Association of Corporate Directors, where he is a member and continues his education.

Mr. Ward brings a wide range of management experience and business knowledge that provides a valuable resource to the Board of Directors. These skills and experience combined with the unique perspective Mr. Ward brings from his background as an entrepreneur provide skills and experience which the Nominating and Corporate Governance Committee considers to be valuable assets for the Board of PROXY STATEMENT Directors.

13 Executive Officers of the Bank Who Are Not Also Directors

Richard S. Spengler, age 55, was appointed Executive Vice President and Chief Lending Officer of Investors Bank effective January 1, 2008. Mr. Spengler began working for Investors Bank in September 2004 as Senior Vice President. Prior to joining Investors Bank, Mr. Spengler had a 21-year career with First Savings Bank, Woodbridge, New Jersey where he served as Executive Vice President and Chief Lending Officer from 1999 to 2004. Mr. Spengler holds a Bachelor’s degree in Business Administration from Rutgers University.

Paul Kalamaras, age 58, was appointed Executive Vice President and Chief Retail Banking Officer of Investors Bank in January of 2010. Mr. Kalamaras joined Investors Bank as a Senior Vice President and Director of Retail Banking in August 2008. Before joining Investors, Mr. Kalamaras was Executive Vice President of Millennium bcp bank, N.A., in Newark, New Jersey where he was responsible for the retail, commercial banking and treasury lines of business. He served on the bank’s Executive Committee and was a member of the Board of Directors. Mr. Kalamaras previously was President and CEO of The Barré Company, a manufacturer of precision engineered metal components for the electronics and telecommunications industry. Mr. Kalamaras is a member of, among other organizations, the Board of

RX STATEMENT PROXY Directors of New Jersey State Chamber of Commerce, Board of Trustees, New Jersey SEEDS, Board of Directors Big Brothers Big Sisters of Northern NJ and Board of Directors New Jersey Region of the American Red Cross. Earlier, Mr. Kalamaras was Executive Vice President at Summit Bank, where he was responsible for the retail network and business banking. Mr. Kalamaras holds a Bachelor’s degree in Finance from the University of Notre Dame.

14 Sean Burke, age 45, was appointed Senior Vice President and Chief Financial Officer of Investors Bank effective January 26, 2015. Prior to joining Investors Bank, Mr. Burke was the Managing Director and Head of U.S. Depository Institution Investment Banking for RBC Capital Markets in New York. Mr. Burke has over 20 years of experience working with financial institutions. Mr. Burke earned bachelor's degrees in accounting and computer science from the University of Notre Dame and earned an MBA from Northwestern University's J.L. Kellogg Graduate School of Management. Prior to attending Northwestern, Mr. Burke was a certified public accountant and worked in the financial services audit practice of Ernst & Young.

Corporate Governance Matters Investors Bancorp is committed to maintaining sound corporate governance guidelines and very high standards of ethical conduct and is in compliance with applicable corporate governance laws and regulations.

Board of Directors Meetings and Committees The Board of Directors of Investors Bancorp and Investors Bank each met 12 times during 2016. The Board of Directors of Investors Bancorp currently maintains four standing committees: the Nominating and Corporate Governance Committee, the Audit Committee, the Compensation and Benefits Committee and the Risk Oversight Committee.

No director attended fewer than 75% of the total number of Board meetings held by the Investors Bancorp and Investors Bank Board of Directors and all committees of the Boards on which they served (during the period they served) during 2016. Investors Bancorp does not have a specific policy regarding attendance at the annual meeting of stockholders. However, all but one of Investors Bancorp’s directors attended the annual meeting of stockholders held on May 24, 2016.

Director Independence A majority of the Board of Directors and each member of the Compensation and Benefits, Nominating and Corporate Governance and Audit Committees are independent, as affirmatively determined by the Board of PROXY STATEMENT Directors consistent with the listing rules of the Nasdaq Stock Market.

The Board of Directors conducts an annual review of director independence for all current nominees for election as directors and all continuing directors. In connection with this review, the Board of Directors considers all relevant facts and circumstances relating to relationships that each director, his or her immediate family members and their respective related interests has with Investors Bancorp and its subsidiaries.

As a result of this review, the Board of Directors affirmatively determined that Messrs. Cashill, Albanese, Cosgrove, Bone, Dittenhafer, Ward, Carlin and Mses. Byrnes and Siekerka, are independent as defined in the Nasdaq corporate governance listing rules. The Board of Directors determined that Messrs. Cummings and Cama are not independent as they are Investors Bank employees. Mr. Garibaldi is not independent due to commercial real estate brokerage services provided by his company to Investors Bank, the subsidiary of Investors Bancorp, in 2015.

15 In establishing its structure and appointing a Lead Independent Director, Investors Bancorp has also taken into account the extent to which a director who satisfies independence standards under the listing rules of the Nasdaq Stock Market would also qualify as an independent outside director (as opposed to an affiliated outside director) under the standards set forth by Institutional Shareholder Services (“ISS”).

Board Leadership Structure – Separate CEO and Chairman Role / Lead Independent Director Currently, the positions of Chairman of the Board and Chief Executive Officer are held by different persons, which the Board believes is appropriate under present circumstances. However, the Board recognizes that its optimal leadership structure can change over time to reflect our Company’s evolving needs, strategy, and operating environment; changes in our Board’s composition and leadership needs; and other factors, including the perspectives of stockholders and other stakeholders. The Board of Directors believes that management accountability and the Board’s independence from management is best served by maintaining a majority of independent directors and where required maintaining standing board committees comprised exclusively of independent members.

In addition, the Board’s Corporate Governance Guidelines allow for the appointment of a Lead Independent Director, who shall be an “independent outside director”, which is defined as an independent director who is not considered an “affiliated outside director” under ISS standards. When appointed by the Board, the Lead Independent Director has the following duties:  Preside at all meetings of the independent outside directors and independent directors;  Coordinate as necessary Investors Bancorp related activities of the independent outside directors;  Facilitate communications between the Chairman of the Board, the CEO and the independent outside directors;  Consult as needed with the Chairman of the Board with respect to meeting agendas and schedules, as well as Board materials, prior to Board meetings; and RX STATEMENT PROXY  Consult with the Chairman of the Board to assure that appropriate topics are being discussed with sufficient time allocated for each.

The Lead Independent Director has the authority to call meetings of the independent outside directors. Pursuant to the recommendation of the Nominating and Corporate Governance Committee, the Board has appointed Brian D. Dittenhafer as Lead Independent Director.

Corporate Governance Guidelines The Board of Directors has adopted Corporate Governance Guidelines, which are posted on the “Governance Documents” section of the “Investor Relations” page of Investors Bank’s website at www.myinvestorsbank.com. The Corporate Governance Guidelines cover the general operating policies and procedures followed by the Board of Directors including, among other things:  Mission of the Board;  Director responsibilities and qualifications;  Board nominating procedures and election criteria;  Stock ownership policies, Board size, director independence; and  Director compensation, education and code of ethics.

16 The Corporate Governance Guidelines provide for the independent directors of the Board of Directors to meet in regularly scheduled executive sessions. During 2016, eight executive sessions were held, of which three were conducted by the independent directors.

Anti-Hedging Policy The Corporate Governance Guidelines include an anti-hedging policy, which prohibits directors and executive officers from engaging in or effecting any transaction designed to hedge or offset the economic risk of owning shares of Investors Bancorp common stock. Accordingly, any hedging, derivative or other equivalent transaction that is specifically designed to reduce or limit the extent to which declines in the trading price of Investors Bancorp common stock would affect the value of the shares of Investors Bancorp common stock owned by an executive officer or director is prohibited. Cashless exercises of employee stock options are not deemed short sales and are not prohibited. This policy does not prohibit transactions in the stock of other companies.

Prohibition on Pledging Securities Company policy prohibits directors and executive officers from holding Company securities in a margin account or pledging Company securities as collateral for any other loan. An exception to this prohibition may be granted, in the sole discretion of the Board and in limited circumstances, after giving consideration to, among other factors, the number of shares proposed to be pledged as a percentage of the director’s or executive officer’s total shares held. No shares are currently pledged by a director or executive officer.

Stock Ownership Requirements The Board of Directors believes that it is in the best interest of Investors Bancorp and its stockholders to align the financial interests of its executives and directors with those of stockholders. Accordingly, the Corporate Governance Guidelines include Stock Ownership Guidelines for Named Executive Officers and Directors of Investors Bancorp that require the following minimum investment in Investors Bancorp common stock:

CEO: A number of shares having a market value equal to five times (5.0x) annual base salary Other Named Executive Officers: A number of shares having a market value equal to three times (3.0x) annual base salary Directors: 25,000 shares

Stock holdings are expected to be achieved within five (5) years of either the implementation of the Ownership Guidelines or the starting date of the individual, whichever is later. Stock ownership for Named PROXY STATEMENT Executive Officer and Directors is reviewed as of the last day of each calendar quarter.

Majority Voting Policy The Board of Directors believes that each director of the Company should have the confidence and support of the Company's stockholders and, to this end, the Board has adopted a majority voting policy, which is utilized for the election of any director at any meeting of stockholders for uncontested elections and shall not be applicable for contested elections. Pursuant to this policy, any incumbent director nominee in an uncontested election who receives a greater number of votes “WITHHELD” than votes cast “FOR” at the stockholders meeting shall promptly tender his or her proposed resignation following certification of the stockholder vote.

The Nominating and Corporate Governance Committee will promptly consider the resignation and will recommend to the Board whether to accept the resignation or to take other action, including rejecting the

17 resignation and addressing any apparent underlying causes of the failure of the director to obtain a majority of votes “FOR” such nominee. The Board will act on the Nominating and Corporate Governance Committee's recommendation no later than at its first regularly scheduled meeting following the committee's deliberation and recommendation, but in any case, no later than 90 days following the certification of the stockholder vote. The Company will publicly disclose the Board's decision and process in a periodic or current report filed with or furnished with to the SEC within 90 days following the certification of the stockholder vote. Any director who tenders his or her resignation will not participate in the Nominating and Corporate Governance Committee's or full Board's deliberations, considerations or actions regarding whether or not to accept the resignation or take any other related action.

Nominating and Corporate Governance Committee The current members of the Nominating and Corporate Governance Committee are: Ms. Byrnes (Chair), Messrs. Bone, Cosgrove, Ward, Dittenhafer and Ms. Siekerka. Each member of the Nominating and Corporate Governance Committee is considered independent as defined in the Nasdaq corporate governance listing rules. The Nominating and Corporate Governance Committee’s Charter and Corporate Governance Guidelines are posted on the “Governance Documents” section of the “Investor Relations” page of the Investors Bank’s website at www.myinvestorsbank.com. The Committee met three times during 2016.

As noted in the Nominating and Corporate Governance Committee Charter, the purpose of the committee is to assist the Board in identifying individuals to become Board members, determine the size and composition of the Board and its committees, monitor Board effectiveness and implement Corporate Governance Guidelines.

In furtherance of this purpose, this committee, among other things, shall:  Lead the search for individuals qualified to become members of the Board of Directors and develop criteria (such as independence, experience relevant to the needs of Investors Bancorp, leadership qualities, diversity, stock ownership) for board membership;  Make recommendations to the Board concerning Board nominees and stockholders proposals;

RX STATEMENT PROXY  Develop, recommend and oversee the annual self-evaluation process of the board and its committees;  Develop and annually review corporate governance guidelines applicable to Investors Bancorp;  Review and monitor the Board’s compliance with Nasdaq Stock Market listing standards for independence; and  Review, in consultation with the Compensation and Benefits Committee, directors’ compensation and benefits.

In accordance with Corporate Governance Guidelines, the Committee considers all qualified director candidates identified by members of the Committee, by other members of the Board of Directors, by senior management and by stockholders. Stockholders recommending a director candidate to the Committee may do so by submitting the candidate’s name, resume and biographical information to the attention of the Chairman of this Committee in accordance with procedures listed in this proxy statement (also available on Investors Bancorp’s website). All stockholder recommendations for director candidates that the Chairman of the Committee receives in accordance with these procedures will be presented to the Committee for its consideration. The Committee’s recommendations to the Board are based on its determination as to the suitability of each individual, and the slate as a whole, to serve as directors of Investors Bancorp.

18 Criteria for Election Investors Bancorp’s goal is to have a Board of Directors whose members have diverse professional backgrounds and have demonstrated professional achievement with the highest personal and professional ethics and integrity and whose values are compatible with those of Investors Bancorp. The Nominating and Corporate Governance Committee does not have a formal policy with regard to the consideration of diversity in identifying director nominees. However, important factors considered in the selection of nominees for director include experience in positions that develop good business judgment, that demonstrate a high degree of responsibility and independence, and that show the individual’s ability to commit adequate time and effort to serve as a director.

Nominees should have a familiarity with the markets in which Investors Bancorp operates, be involved in activities that do not create a conflict with his/her responsibilities to Investors Bancorp and its stockholders, and have the capacity and desire to represent the balanced, best interests of the stockholders of Investors Bancorp as a group, and not primarily a special interest group or constituency.

The Nominating and Corporate Governance Committee will also take into account whether a candidate satisfies the criteria for “independence” as defined in the Nasdaq corporate governance listing rules, and, if a candidate with financial and accounting expertise is sought for service on the Audit Committee, whether the individual qualifies as an Audit Committee financial expert.

On March 27, 2017, Mr. Carlin was appointed to the Boards of Directors of Investors Bancorp and its subsidiary, Investors Bank, each for a term expiring in 2020. These appointments were made in accordance with an agreement dated as of March 27, 2017 (the “Agreement”) between Investors Bancorp and Blue Harbour Group, L.P. (“Blue Harbour”). Blue Harbour has had a significant shareholder interest in Investors Bancorp since 2014 and Mr. Carlin is a managing director of Blue Harbour. Mr. Carlin has substantial experience and expertise in the capital and financial markets and is very familiar with Investors Bancorp’s operations and the markets in which it conducts business. Mr. Carlin’s appointment further evidences Investors Bancorp’s commitment to alignment and engagement with its shareholders.

Under the terms of the Agreement, for so long as Blue Harbour and the investment funds managed by it own at least four percent (4%) of the outstanding shares of Investors Bancorp’s common stock, it shall be entitled to propose one designee to the Boards of Directors of Investors Bancorp and Investors Bank, subject to the satisfaction of applicable corporate governance requirements. If at any time Blue Harbour’s aggregate ownership of Investors Bancorp’s common stock shall fall below four percent (4%) of the outstanding shares, Investors Bancorp can require that Mr. Carlin, or any other designee of Blue Harbour then serving on the Boards of Directors of Investors Bancorp and Investors Bank, resign from the Boards of Directors. For a further discussion of the Agreement, see “Transactions with Related Persons”.

Procedures for the Nomination of Directors by Stockholders PROXY STATEMENT As previously indicated, the Nominating and Corporate Governance Committee has adopted procedures for the consideration of Board candidates submitted by stockholders. Stockholders can submit the names of candidates for director by writing to the Chair of the Nominating and Corporate Governance Committee, at Investors Bancorp, Inc., 101 JFK Parkway, Short Hills New Jersey 07078. The submission must include the following information:  a statement that the writer is a stockholder and is proposing a candidate for consideration by the Nominating and Corporate Governance Committee;  the qualifications of the candidate and why this candidate is being proposed;  the name, address and contact information for the nominated candidate, and the number of shares of Investors Bancorp common stock that are owned by the candidate (if the candidate is not a holder of record, appropriate evidence of the stockholder’s ownership should be provided);

19  the name and address of the nominating stockholder as he/she appears on Investors Bancorp’s books, and number of shares of Investors Bancorp common stock that are owned beneficially by such stockholder (if the stockholder is not a holder of record, appropriate evidence of the stockholder’s ownership will be required);  a statement of the candidate’s business and educational experience;  such other information regarding the candidate as would be required to be included in a proxy statement pursuant to SEC Regulation 14A;  a statement detailing any relationship between the candidate and Investors Bancorp and between the candidate and any customer, supplier or competitor of Investors Bancorp;  detailed information about any relationship or understanding between the proposing stockholder and the candidate; and  a statement that the candidate is willing to be considered and willing to serve as a director if nominated and elected.

A nomination submitted by a stockholder for presentation by the stockholder at an annual meeting of stockholders must comply with the procedural and informational requirements described in “Advance Notice of Business to be Conducted at an Annual Meeting.” Investors Bancorp did not receive any stockholder submission for Board nominees for this annual meeting.

Stockholder and Interested Party Communication with the Board A stockholder of Investors Bancorp who wants to communicate with the Board or with any individual director can write to the Chair of the Nominating and Corporate Governance Committee at Investors Bancorp, Inc., 101 JFK Parkway, Short Hills, New Jersey 07078. The letter should indicate that the author is a stockholder and if shares are not held of record, should include appropriate evidence of stock ownership. Depending on the subject matter, the Chair will:  Forward the communication to the director(s) to whom it is addressed; RX STATEMENT PROXY  Handle the inquiry directly, for example where it is a request for information about Investors Bancorp or it is a stock-related matter; or  Not forward the communication if it is primarily commercial in nature, relates to an improper or irrelevant topic, or is unduly hostile, threatening, illegal or otherwise inappropriate.

At each Board meeting, the Chair of the Nominating and Corporate Governance Committee shall present a summary of all communications received since the last meeting and make those communications available to the directors upon request.

Code of Business Conduct and Ethics The Board has adopted a Code of Business Conduct and Ethics to be followed by Investors Bancorp’s employees, officers (including its CEO, CFO and CAO) and directors to communicate our commitment to ethical conduct and to describe our standards and expectations for integrity and ethical behavior. Directors, NEOs, executive officers and employees are required to read, understand and comply with the Code. Investors Bancorp requires that all new employees take Code training shortly after their commencement of employment and also requires periodic training for all directors and employees. All employees must certify annually that they have read the Code and agree to abide by it.

The Code provides that any waivers for directors or executive officers may be made only by the Board of Directors and must be promptly disclosed to the shareholders. During 2016, the Board of Directors did not receive nor grant any request for directors or executive officers for waivers under the provisions of the Code.

20 This Code was last modified on November 22, 2016 and is available on the “Governance Documents” section of the “Investors Relations” page of the Investors Bank’s website at www.myinvestorsbank.com. Investors Bancorp will post on its website any amendments to the Code and any waivers granted to its directors or executive officers.

Investors Bancorp expects its employees to report behavior that concerns them or may represent a violation of the Code. Investors Bancorp offers several channels by which employees may raise an issue or concern, including any actual or potential violation of the Code. One such channel is EthicsPoint, a website and telephone hotline that is available to employees 24 hours a day, 7 days a week. EthicsPoint complaints or concerns can be submitted anonymously.

Environmental, Social and Corporate Governance As we continuously endeavor to make Investors Bancorp a great place to work, we listen to our employees and build on our programs and resources to enhance their experience, help cultivate their competencies and further their careers with us. We are dedicated to the learning initiatives for our employees that promote both their professional and personal well-being. We have a chief culture officer who focuses on ensuring that the strategies and ideas of the Company align with the overall long-term strategy of the organization. Our strong sense of community is one of our main core values and we make this part of the onboarding experience for our new employees through volunteer opportunities in the communities we serve. This community involvement and team orientation are incorporated into our annual performance reviews. Our contributions to community-based organizations are just a part of the commitment we make. Our business practices and policies also promote social responsibility, both environmentally and industry- related, to promote responsible growth. We continuously focus on our economic, social and corporate governance responsibilities to grow in a sustainable manner.

Section 16(a) Beneficial Ownership Reporting Compliance Investors Bancorp’s common stock is registered with the SEC pursuant to Section 12(b) of the Exchange Act. The executive officers and directors of Investors Bancorp, and beneficial owners of greater than 10% of Investors Bancorp’s common stock, are required to file reports on Forms 3, 4 and 5 with the SEC disclosing beneficial ownership and changes in beneficial ownership of Investors Bancorp’s common stock. The SEC rules require disclosure in Investors Bancorp’s Proxy Statement or Annual Report on Form 10-K of the failure of an executive officer, director or 10% beneficial owner of Investors Bancorp’s common stock to file a Form 3, 4, or 5 on a timely basis. Based on Investors Bancorp’s review of ownership reports and confirmations by executive officers and directors, Investors Bancorp believes that, during 2016, its officers, directors and beneficial owners of greater than 10% of its common stock timely filed all required reports. PROXY STATEMENT

Transactions With Certain Related Persons Federal laws and regulations generally require that all loans or extensions of credit to executive officers and directors must be made on substantially the same terms, including interest rates and collateral, as those prevailing at the time for comparable transactions with the general public and must not involve more than the normal risk of repayment or present other unfavorable features. However, regulations also permit executive officers and directors to receive the same terms through programs that are widely available to other employees, as long as the executive officer or director is not given preferential treatment compared to the other participating employees. Pursuant to such a program, loans have been extended to executive officers on substantially the same terms, including interest rates and collateral, as those prevailing at the time for comparable transactions with the general public, with the exception of waiving certain fees. These loans do not involve more than the normal risk of collectability or present other unfavorable features.

21 Section 402 of the Sarbanes-Oxley Act of 2002 generally prohibits an issuer from: (1) extending or maintaining credit; (2) arranging for the extension of credit; or (3) renewing an extension of credit in the form of a personal loan for an officer or director. However, the prohibitions of Section 402 do not apply to loans made by a depository institution, such as Investors Bank, that is insured by the FDIC and is subject to the insider lending restrictions of the Federal Reserve Act. The Audit Committee and the Board reviews related party transactions, the disclosure of which is required under SEC proxy disclosure rules.

As noted above in the section entitled “Criteria for Election”, on March 27, 2017 Investors Bancorp entered into the Agreement with Blue Harbour pursuant to which Mr. Carlin was appointed to the Boards of Directors of Investors Bancorp and Investors Bank. Under the terms of the Agreement, for so long as Blue Harbour and the investment funds managed by it own at least four percent (4%) of the outstanding shares of Investors Bancorp’s common stock, it shall be entitled to have one designee serve on the Boards of Directors of Investors Bancorp and Investors Bank, subject to the satisfaction of applicable corporate governance requirements. If at any time Blue Harbour’s aggregate ownership of Investors Bancorp’s common stock shall fall below four percent (4%) of the outstanding shares, Investors Bancorp can require that Mr. Carlin, or any other designee of Blue Harbour then serving on the Boards of Directors of Investors Bancorp and Investors Bank, resign from the Boards of Directors.

In accordance with the terms of the Agreement, during the period commencing on March 27, 2017 and ending on the earlier of (i) the day after the Company’s 2020 Annual Meeting of Stockholders, or (ii) the date as of which Blue Harbour’s Board designee is no longer a director of the Company and Investors Bank (the “Restricted Period”), Blue Harbour agreed to vote its shares (A) in favor of each director nominated and recommended by the Board for election by the stockholders, (B) against any stockholder nominations for director that are not approved and recommended by the Board and against any proposals or resolutions to remove any member of the Board, and (C) in accordance with the recommendations of the Board on all other proposals of the Board set forth in the Company’s proxy statements. During the Restricted Period, Blue Harbour also agreed to comply with the terms of customary standstill provisions.

Risk Oversight Matters

RX STATEMENT PROXY Risk Oversight Committee The entire Board of Directors is engaged in risk oversight. However, the Board established a separate standing Risk Oversight Committee to facilitate its risk oversight responsibilities. The current members of the Risk Oversight Committee are Messrs. Ward (Chair), Bone, Cosgrove, Cashill, Dittenhafer, Garibaldi, Albanese, and Mses. Byrnes and Siekerka. The Chief Executive Officer and Chief Operating Officer serve as a resource to the Risk Oversight Committee but have no vote in the committee’s decision-making process. The Risk Oversight Committee Charter is posted on the “Governance Documents” section of the “Investors Relations” page of the Investors Bank’s website at www.myinvestorsbank.com. The Committee met three times during 2016.

The Risk Oversight Committee has responsibility for enterprise-wide risk management and determining that significant risks of Investors Bancorp are monitored by the Board of Directors or one of its standing committees. In addition, the Risk Oversight Committee reviews new products and services proposed to be implemented by management to determine that appropriate risk identification has occurred and that controls are considered to mitigate identified risks to an acceptable level. The Risk Oversight Committee is also responsible for reviewing and monitoring enterprise risk including interest rate, liquidity, operational, compliance, strategic and reputational risks.

22 Audit Committee Matters Audit Committee The current members of the Audit Committee are: Messrs. Albanese (Chair), Cosgrove, Dittenhafer, Ward and Mses. Byrnes and Siekerka. Each member of the Audit Committee is considered independent as defined in the Nasdaq corporate governance listing rules and under SEC Rule 10A-3. The Board considers Mr. Albanese, the Chair of the Audit Committee, and Mr. Dittenhafer each an “audit committee financial expert” as that term is used in the rules and regulations of the SEC.

The Audit Committee operates under a written charter adopted by the Board of Directors. The Audit Committee’s Charter is posted on the “Governance Documents” section of the “Investor Relations” page of Investors Bank’s website at www.myinvestorsbank.com.

As noted in Audit Committee Charter, the primary purpose of the Audit Committee is to assist the Board in overseeing:  The integrity of Investors Bancorp’s financial statements;  Investors Bancorp’s compliance with legal and regulatory requirements;  The independent auditor’s qualifications and independence;  The performance of Investors Bancorp’s internal audit function and independent auditor; and  Investors Bancorp’s system of disclosure controls and system of internal controls regarding finance, accounting, and legal compliance.

In furtherance of this purpose, this committee, among other things, shall:  Retain, oversee and evaluate a firm of independent registered public accountants to audit the annual financial statements;  Review the integrity of Investors Bancorp’s internal controls over financial reporting, both internal and external, in consultation with the independent registered public accounting firm and the internal auditor;  Review the financial statements and the audit report with management and the independent registered public accounting firm;  Review earnings and financial releases and quarterly and annual reports filed with the SEC; and  Approve all engagements for audit and non-audit services by the independent registered

public accounting firm. PROXY STATEMENT

The Audit Committee met six times during 2016. The Audit Committee reports to the Board of Directors on its activities and findings.

23 Audit Committee Report Pursuant to rules and regulations of the SEC, this Audit Committee Report shall not be deemed incorporated by reference by any general statement incorporating by reference this Proxy Statement into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except to the extent that Investors Bancorp specifically incorporates this information by reference, and otherwise shall not be deemed “soliciting material” or to be “filed” with the SEC subject to Regulation 14A or 14C of the SEC or subject to the liabilities of Section 18 of the Exchange Act.

Management has the primary responsibility for Investors Bancorp’s internal control and financial reporting process, and for making an assessment of the effectiveness of Investors Bancorp’s internal control over financial reporting. The independent registered public accounting firm is responsible for performing an independent audit of Investors Bancorp’s consolidated financial statements in accordance with standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”) and to issue an opinion on those financial statements, and for providing an opinion on the Company's internal control over financial reporting. The Audit Committee’s responsibility is to monitor and oversee these processes.

As part of its ongoing activities, the Audit Committee has:  reviewed and discussed with management, and the independent registered public accounting firm, the audited consolidated financial statements and the internal control procedures of Investors Bancorp for the year ended December 31, 2016;  discussed with the independent registered public accounting firm the matters required to be discussed by Statement on Auditing Standards No. 1301, Communications with Audit Committees, as adopted by the PCAOB; and  received the written disclosures and the letter from the independent registered public accounting firm required by applicable requirements of the PCAOB regarding the independent registered public accounting firm’s communications with the Audit Committee concerning independence, and has discussed with the independent registered public accounting firm its independence from Investors Bancorp. RX STATEMENT PROXY Based on the review and discussions referred to above, the Audit Committee has recommended to Investors Bancorp’s Board of Directors that the audited consolidated financial statements for the year ended December 31, 2016 be included in Investors Bancorp’s Annual Report on Form 10-K for filing with the SEC. In addition, the Audit Committee approved the re-appointment of KPMG LLP as the independent registered public accounting firm for the year ending December 31, 2017, subject to the ratification of this appointment by the stockholders of Investors Bancorp.

Audit Committee of Investors Bancorp, Inc. Robert C. Albanese, Chair William V. Cosgrove, Member Brian D. Dittenhafer, Member James H. Ward III, Member Doreen R. Byrnes, Member Michele N. Siekerka, Member

24 Compensation and Benefits Committee Matters Compensation and Benefits Committee The current members of the Compensation and Benefits Committee are: Messrs. Bone (Chair), Albanese, Cosgrove, Dittenhafer, Ward and Ms. Byrnes. Each member of the Compensation and Benefits Committee is considered independent as defined in the Nasdaq corporate governance listing rules and SEC Rule 10C-1. The Compensation and Benefits Committee’s Charter is posted on the “Governance Documents” section of the “Investor Relations” page of the Investors Bank’s website at www.myinvestorsbank.com. The Committee met seven times during 2016.

As noted in the Compensation and Benefits Committee Charter, the purpose of the committee is to assist the Board in carrying out the Board’s overall responsibility relating to executive compensation, incentive compensation and equity and non-equity based benefit plans.

In furtherance of this purpose, this committee, among other things, shall:  Review and recommend to the Board for approval the Chief Executive Officer’s annual compensation, including salary, cash incentive, incentive and equity compensation;  Review and recommend to the Board the evaluation process and compensation for Investors Bancorp’s executive officers and coordinate compensation determinations and benefit plans for all employees of Investors Bancorp;  Review Investors Bancorp’s incentive compensation and other equity-based plans and make changes in such plans as needed;  Review, as appropriate and in consultation with the Nominating and Corporate Governance Committee, director compensation and benefits; and  Review the independence of the Compensation and Benefits Committee members, legal counsel and compensation consultants.

In addition to these duties the committee shall assist the Board in recruiting and succession planning.

The Compensation and Benefits Committee retains responsibility for all compensation recommendations to the Board of Directors as to Investors Bancorp’s executive officers. The Compensation and Benefits Committee may utilize information and benchmarks from an independent compensation consulting firm, and from other sources, to determine how executive compensation levels compare to those companies within the industry. The Compensation and Benefits Committee may review published data for companies of similar size, location, financial characteristics and stage of development among other factors.

In designing the compensation program for Investors Bancorp, the Committee takes into consideration PROXY STATEMENT methods to avoid encouraging the taking of excessive risk by executive management or by any other employees. The Committee assessed risks posed by the incentive compensation paid to executive management and other employees and determined that Investors Bancorp’s compensation policies, practices and programs do not pose risks that are reasonably likely to have a material adverse effect on Investors Bancorp.

The basic elements of Investors Bancorp’s executive compensation program include base salary, annual cash incentive awards, long-term equity incentive awards and other benefit arrangements. In addition to determining the compensation payable to Investors Bancorp’s executive officers, including the Chief Executive Officer and other Named Executive Officers, the Compensation and Benefits Committee evaluates senior executive and director compensation plans and programs, administers and has discretionary authority over the issuance of equity awards under Investors Bancorp’s equity compensation plans and oversees preparation of a report on executive compensation for inclusion in Investors Bancorp’s annual proxy statement. The Compensation and Benefits

25 Committee is supported by the Chief Executive Officer and Chief Operating Officer, both of whom serve as a resource by providing input regarding Investors Bancorp’s executive compensation program and philosophy.

Compensation and Benefits Committee Interlocks and Insider Participation During 2016, Messrs. Dittenhafer, Dugan, Albanese, Bone and Ward served as members of the Compensation and Benefits Committee. None of these directors has ever been an officer or employee of Investors Bancorp; or an executive officer of another entity at which one of Investors Bancorp’s executive officers serves on the Board of Directors, or had any transactions or relationships with Investors Bancorp in 2016 requiring specific disclosures under SEC rules or Nasdaq listing standards. Mr. Cosgrove and Ms. Byrnes, who also served as members of the Compensation and Benefits Committee in calendar 2016, are neither an executive officer of another entity at which one of Investors Bancorp’s executive officers serves on the Board of Directors, nor had transactions or relationships with Investors Bancorp in 2016 requiring specific disclosures under SEC rules. Mr. Cosgrove was a non Section 16 officer of Investors Bank commencing with Investors Bancorp’s acquisition of Summit Federal Bankshares, Inc. and Summit Federal Savings Bank in June 2008 through his retirement from Investors Bank on October 1, 2011. Ms. Byrnes was an officer of Investors Bank prior to her retirement in 2007.

Compensation Discussion and Analysis Investors Bancorp’s Transformation from 2007 - 2014 Since the Company’s initial public offering in 2005, it has transitioned from a wholesale thrift to a retail commercial bank. This transition has been primarily accomplished by growing commercial loans and shifting the mix of deposits to a greater percentage of core deposits. A significant portion of this growth was achieved organically and through bank acquisitions. From 2008 through 2014 the Company completed eight bank or bank branch acquisitions which provided us with the opportunity to grow our business, expand our geographic footprint and improve our financial performance.

Capital management is also a key component of our business strategy. In May 2014 we raised net

RX STATEMENT PROXY proceeds of $2.2 billion in equity upon the completion of the second step mutual conversion (“Second Step Conversion”). Prior to the Second Step Conversion, our parent company held 55% of Investors Bancorp's outstanding common stock in connection with its initial public offering in 2005. With the completion of the Second Step Conversion, we reorganized from a two-tier mutual holding company structure to a fully public stock holding company structure. This was an important milestone for our company which was the culmination of the significant growth from the period 2007 through 2014, where assets grew 245% and total shareholder return over that same period was 86%.

Asset Growth: 245% 2007 2008 2009 2010 2011 2012 2013 2014 Total Shareholder Return: 86% June 2008 January 2012 May 2014 Acquistion May 2009 Acquistion of $2.2 Billion of Summit Acqisition of Brooklyn Federal Capital Federal American Savings Bank Raise Savings Bank Bank of New Jersey October 2010 October 2012 January 2014 Acquistion of Acquistion of Acquistion of Millennium Marathon Gateway Bcpbank National Bank Financial October 2009 branches December 2013 Acquistion of 6 Acquistion of Banco Popular Roma Financial branches Corporation

2007 2008 2009 2010 2011 2012 2013 2014 Asset Growth: 245% Total Shareholder Return: 86% June 2008 Acquisition of Summit Federal Savings Bank May 2009 Acquisition of American Bank December 2013 Acquisition of Roma Financial Corporation January 2014 Acquisition of Gateway Financial May 2014 $2.2 Billion Capital Raise

26 2016 Financial Performance We continue to execute on a strategy of prudent capital management to create shareholder value. During 2016, we accomplished this through a combination of organic growth, stock repurchases and dividends. Since receiving approval in March 2015 for our repurchase program, we have repurchased 62.9 million shares totaling $746.3 million at an average price of $11.86. For the year ended 2016 our dividend payout ratio was 40% which includes a 33% dividend increase in the fourth quarter of 2016 to $0.08 per share. These capital strategies are important to the successful deployment of the $2.2 billion in capital raised during the Second Step Conversion. Our total shareholder return for the one, two and three year period ended December 31, 2016 was 14.7%, 29.7% and 46.9%, respectively.

2016 was another strong year of earnings for Investors Bancorp as earnings per share grew 16% year over year. We continued to make significant investments in our risk management infrastructure and branch franchise. Total assets increased $2.28 billion, or 10.9% to $23.17 billion at December 31, 2016 from $20.89 billion at December 31, 2015, driven mainly by loan growth of $1.91 billion year-over-year. Our credit quality remains a key focus for our Company as demonstrated by the decrease in our level of non-accrual loans to $94.3 million in 2016 from $115.4 million in 2015.

Net Income Credit Quality (in millions) Non-Performing Assets / Assets $192.1 $181.5 0.81% 0.69% 0.47% $131.7

2014 2015 2016 2014 2015 2016

Capital Levels Total Shareholder Return Common Equity Tier 1 Ratio period ending December 31, 2016

17.01% 46.9% 15.87% 14.75% 29.7% 14.7% PROXY STATEMENT

2014 2015 2016 One year Two year Three year

Net Income (in millions) $131.7 $181.5 $192.1 2014 2015 2016 Credit Quality Non-Performing Assets 0.81% 0.69% 0.47% 2014 2015 2016 Non-performing assets as a percentage of total assets Capital Levels Common Equity Tier 1 Ratio 19.06% 15.85% 13.48% 2014 2015 2016 Total Shareholder Return Three Year 13% 28% 47% 2014 2015 2016

27 Executive Summary As discussed in greater detail below, our compensation program is specifically designed to provide executives with competitive compensation packages that include elements of both reward and retention. The Compensation and Benefits Committee routinely reviews our executive compensation practices to remain market competitive and to ensure that these practices are aligned with our compensation philosophy and objectives, regulatory requirements and evolving best practices. Key highlights of the program include:  All members of the Compensation and Benefits Committee and all of its compensation consultants and advisers are independent under applicable Nasdaq rules, which ensures that all aspects of the compensation decision-making process are free from conflicts of interest.  The Compensation and Benefits Committee controls the selection and activities of any compensation consultant or advisers who assist us with executive compensation matters.  We maintain a clawback policy for bonus and other incentive compensation paid to executive officers, which mitigates risk-taking behavior.  Our directors and Named Executive Officers are required to hold our common stock at specified minimum levels, which recognizes the importance of aligning their interests with those of stockholders. In particular, our Chief Executive Officer is required to hold Investors Bancorp common stock valued at five times his annual base salary.  The Compensation and Benefits Committee continually reviews all incentive compensation programs with respect to risk-taking behavior, with the guiding principle being the safety and soundness of Investors Bancorp and Investors Bank as paramount to all compensation incentives. The Compensation and Benefits Committee consults with the Risk Oversight Committee on these matters.  A significant portion of each Named Executive Officer's compensation is in the form of short and long-term performance-based pay, which reflects and reinforces our pay for performance philosophy.  Compensation packages for Named Executive Officers include an appropriate mix of fixed and

RX STATEMENT PROXY variable pay, which provides Named Executive Officers with both reward and retention incentives.  We provide limited executive perquisites.  Assistance is regularly provided to the Compensation and Benefits Committee by an independent compensation consultant selected by such committee.

This discussion is focused specifically on the compensation of the following executive officers, each of whom is named in the Summary Compensation Table and other compensation tables which appears later in this section. The following executives are referred to in this discussion as “Named Executive Officers.”

Name Title Kevin Cummings President and Chief Executive Officer Domenick A. Cama Senior Executive Vice President and Chief Operating Officer Richard S. Spengler Executive Vice President and Chief Lending Officer Paul Kalamaras Executive Vice President and Chief Retail Banking Officer Sean Burke Senior Vice President and Chief Financial Officer

Executive Compensation Philosophy Investors Bancorp’s executive compensation program is designed to offer competitive cash and equity compensation and benefits that will attract, motivate and retain highly qualified and talented executives who will help maximize Investors Bancorp’s financial performance and earnings growth. Investors Bancorp’s executive compensation program is also intended to align the interests of its executive officers with

28 stockholders by rewarding performance against established corporate financial targets, and by motivating strong executive leadership and superior individual performance. In this regard: (1) a substantial portion of the compensation payable to our Named Executive Officers is linked to financial and individual performance; (2) the interests of our Named Executive Officers are aligned with the long-term interests of our stockholders through their stock-based and non-equity incentive compensation, which are earned primarily based on the satisfaction of corporate performance metrics; (3) our focus is providing compensation that is commensurate with the achievement of short-term and long-term financial goals and individual performance; and (4) our executive compensation program is competitive to attract, retain and motivate our Named Executive Officers.

Investors Bancorp’s executive compensation program allocates portions of total compensation between long-term and short-term compensation and between cash and non-cash compensation by including competitive base salaries, an annual cash incentive plan, stock options and performance and time-based stock awards, supplemental executive retirement benefits and executive perquisites, which encourage long term employment with Investors Bancorp.

The compensation paid to each Named Executive Officer is based on the executive officer’s level of job responsibility, corporate financial performance measured against corporate financial targets, and an assessment of individual performance. A significant portion of each Named Executive Officer's total compensation is performance-based because each executive is in a leadership role that can significantly impact corporate performance.

The following are key features of our executive compensation program:

What We Do What We Don’t Do  We carefully control business risk by ensuring that the  We don’t modify annual incentive compensation structure and administration of our executive and performance objectives during the year in which those incentive compensation plans are reasonable and objectives apply. appropriate.  We don’t award stock compensation with short vesting  We utilize an independent compensation consultant to periods to Named Executive Officers annually evaluate Named Executive Officer cash and stock compensation based on the pay levels of  We don’t require the base salaries and total cash comparable executives in fifteen-to-twenty peer compensation of our Named Executive Officers to attain comparator banking companies. any particular percentile position versus the compensation of executives in our peer comparator  We pay equity and non equity incentive compensation companies. based on our most important measurable and verifiable corporate performance objectives.  We don’t allow directors and executive officers to engage in or effect transactions designed to hedge or  We award long-term stock compensation, the vesting of offset economic risk of owning shares of our stock. which depends on multi-year financial performance.  We don’t allow directors and executive officers to hold  We conservatively vest stock compensation over long

company stock in a margin account or pledge securities PROXY STATEMENT periods of time (generally five years for performance- as collateral. based stock awards and five-to-seven years for time- vested stock awards).  We no longer enter into change of control agreements with single triggers.  We require each of our Named Executive Officers to own Company common stock valued at a minimum of  We don’t have excessive perquisites. three-to-five times their annual salary.  We don’t enter into new employment contracts with tax  We maintain a clawback policy for bonus and other gross up provisions. incentive compensation paid to executive officers, which mitigates risk-taking behavior.  We will place greater weight on performance when granting future equity awards.

29 Summary of Shareholder Engagement Following Investors Bancorp’s Annual Meeting of Stockholders in May 2016, the Compensation and Benefits Committee reviewed the results of the stockholder advisory vote on our 2015 executive compensation program for our Named Executive Officers and related compensation policies and decisions. At our 2016 annual meeting, approximately 52% of the votes cast on the proposal were voted in support of the compensation outlined in last year’s proxy statement (commonly referred to as “Say-on-Pay”). This was a significant departure from the support stockholders expressed in the 2014 and 2015 Say-on-Pay votes (approximately 98% and 96%, respectively) even though the core philosophy and design of our annual compensation programs remained materially consistent across all three years.

Throughout the course of 2016, management met with the majority of shareholders, primarily through individual conversations, investor conferences, investor roadshows, through our investor relations channel and at our annual shareholder meeting. Management reached out to over 50% of outstanding shareholders over the course of 2016 and had interaction with over 40% of outstanding shareholders. Over the course of the interaction and meetings, management discussed the Company’s most recent financial results, capital management and execution of business strategies. In addition to these items, stockholder feedback following the 2016 Say-on-Pay was also discussed. Below is a summary of the areas discussed with regard to Say-on-Pay:

What We Heard The 2015 Stock and Option Awards granted to our CEO were viewed as excessive and were not well understood. We had extensive discussions with shareholders relating to Say-on-Pay, primarily related to the size of the 2015 grant of Stock and Option awards granted to our CEO under the 2015 Equity Incentive Plan. As part of these discussions, we found that these shareholders understood the Company’s rationale in making such awards and were also familiar with marketplace precedents in the banking industry that the Company relied upon in establishing the size and structure of such awards. Management believes our shareholders understood the transformation the Company underwent up through 2014 and the strong incentive and retention features embedded in the awards. RX STATEMENT PROXY How We Responded Future awards will not be of this magnitude. The magnitude of the 2015 stock grant was made in the context of an important milestone in the Company’s historic Second Step Conversion to a fully public company. The Company does not anticipate that future awards of stock compensation to the Named Executive Officers will be similar to the 2015 grant in size or in potential compensation value.

In 2016, the Compensation and Benefits Committee determined that no awards to Named Executive Officers were necessary, as the number of restricted stock awards and stock options provided to the Named Executive Officers in June 2015 were effective in achieving performance incentive and management retention. The sustained service requirements and future performance contingencies included in the 2015 stock awards will be effective in retaining and motivating our senior management team to continue their dedication and loyalty to the Company, as well as their concentrated efforts toward furthering Company growth and shareholder value creation.

Based on information provided to the Compensation and Benefits Committee, future stock awards granted to the Named Executive Officers will not be similar in size or potential value to those provided in June 2015. The future use of stock incentive compensation as an element of the Company’s overall executive compensation program will depend on specific items, including but not limited to individual and company performance, succession and leadership evaluation, comparative compensation data and prevailing marketplace practice.

30 Greater emphasis on performance based compensation. Since the June 2015 stock awards were primarily focused on the future retention and stability of our key management team, 75% of the awards were made in the form of time-vested restricted stock with seven-year vesting. We believe that our seven-year vesting schedule is an extraordinarily long and stringent requirement as compared to the compensation practices of our peers, and that it will ensure the strong retention of our key executives in the years ahead.

25% of the equity grants made in 2015 to the NEO’s were performance based and will measure certain performance metrics over a three year period (2015-2017). The Compensation and Benefits Committee is aware of the use of performance-based compensation made by its selected peer comparator companies in recent years and expects that future awards of stock incentive compensation to the Named Executive Officers will be weighted more heavily towards performance-based compensation.

The Compensation and Benefits Committee does not have any immediate plans or any explicit intentions to make additional stock awards to the Chief Executive Officer or Chief Operating Officer or to establish commensurate performance periods or requirements since the Company is still in the midst of the performance period established in 2015. Should any such stock awards and their related contingencies be established by the Compensation and Benefits Committee going forward, the Company expects that a greater number of future stock awards will be associated with specific performance requirements reflective of the Company’s strategic multi-year performance objectives.

Changes made to pension benefits. The Compensation and Benefits Committee carefully and diligently reviews all elements of compensation on an annual basis. The Committee utilizes information and benchmarks to determine how executive compensation levels compare to those companies within the industry. As a result of their review, changes were made to the pension benefits.

As of December 31, 2016, the annual benefit provided under the tax-qualified defined benefit plan (the “Defined Benefit Plan”) was frozen. As a result, each participant’s frozen accrued benefit will be determined as of December 31, 2016 and no further benefits will accrue beyond such date.

Additionally, effective December 31, 2016, the Executive Supplemental Retirement Wage Replacement Plan (“SERP II”) was frozen. The SERP II was amended to freeze future benefit accruals and, for certain participants, structure the benefits payable attributable solely to the participants’ 2016 year of service to vest over a two-year period. Messrs. Cummings, Cama, Kalamaras and Spengler are participants in the SERP II and were impacted by this freeze.

Continue to enhance shareholder engagement. PROXY STATEMENT Throughout 2016, management met with over 40% of outstanding shareholders, with an outreach to over 50% of outstanding shareholders. We meet with the majority of our shareholders through individual conversations, at certain investor conferences, investor roadshows, through our investor relations channel and at our annual shareholder meeting. We will continue to create opportunities for shareholder engagement going forward through similar channels as we did in 2016. In addition, we have a structure in place to allow shareholders to communicate directly with our Board (see “Corporate Governance Matters” section above).

We have regular dialogue with members of Blue Harbor Group, one of our largest shareholders since 2014 and remain aligned on strategy and practices that deliver shareholder value. Blue Harbor Group supported Say-on-Pay at our 2016 annual meeting because they understood the principles under which those shares were granted.

31 On March 27, 2017 the Company announced the appointment of Peter Carlin to the 2020 class of Directors for Investors Bancorp and Investors Bank. Mr. Carlin has been a Managing Director at Blue Harbour since 2014. We believe that having one of our largest shareholders represented as a member of our Boards demonstrates our commitment to further aligning our interests with shareholders. Mr. Carlin’s strong financial background and operational expertise will enhance our Boards as we continue to grow our franchise.

Role of Executive Officers Although the Compensation and Benefits Committee is ultimately responsible for designing our executive compensation program, the Chief Executive Officer and Chief Operating Officer serve as a resource to the Compensation and Benefits Committee and are critical in ensuring that the Compensation and Benefits Committee has the pertinent information needed to make well-informed and appropriate decisions. The Chief Executive Officer and Chief Operating Officer participate in compensation-related activities purely in an informational and advisory capacity and have no votes in the committee’s decision-making process.

The Compensation and Benefits Committee meets regularly with the Chief Executive Officer and Chief Operating Officer regarding the potential incentive compensation performance metrics, including their respective weightings, and to review the progress towards the achievement of the pre-established corporate financial targets and individual performance goals related to our cash and equity incentive plans. Also, the Chief Executive Officer and Chief Operating Officer provide the Compensation and Benefits Committee with performance assessments and compensation recommendations for each of the other Named Executive Officers, which are considered by the Compensation and Benefits Committee in arriving at its compensation determinations. However, the Chief Executive Officer and Chief Operating Officer do not attend portions of committee meetings during which their performance is being evaluated or their compensation is being determined.

Role of Compensation Consultant For 2016, the Compensation and Benefits Committee engaged GK Partners, an independent compensation consultant, to assist in its evaluation of Investors Bancorp’s executive compensation program and providing an

RX STATEMENT PROXY annual competitive evaluation of the total compensation of the Named Executive Officers. GK Partners reported directly to the Compensation and Benefits Committee, and did not perform any other services to Investors Bancorp or Investors Bank. GK Partners provided the Compensation and Benefits Committee with executive compensation benchmarking trends and external developments, and also provided input on Investors Bancorp and Investors Bank's short-term and long-term incentive plans for best practices and market competitiveness.

The Compensation and Benefits Committee considered the independence of GK Partners under the Securities and Exchange Commission rules and NASDAQ corporate governance listing standards. The Compensation and Benefits Committee requested and received a report from GK Partners regarding its independence, including information relating to the following factors: (1) other services provided to Investors Bancorp by GK Partners; (2) fees paid by Investors Bancorp as a percentage of GK Partners’ total revenue; (3) policies or procedures maintained by GK Partners that are designed to prevent a conflict of interest; (4) any business or personal relationships between the senior advisors and any member of the Compensation and Benefits Committee; (5) any Investors Bancorp common stock owned by the senior advisors; and (6) any business or personal relationships between Investors Bancorp’s executive officers and GK Partners. The Compensation and Benefits Committee discussed these considerations and concluded that GK Partners was independent and had no conflicts of interest with respect to its engagement.

Market Comparison For 2016, GK Partners compared Investors Bancorp’s executive compensation program to peer group compensation data. GK Partners provided the Compensation and Benefits Committee with relevant competitive cash and stock compensation information obtained from public disclosures of a selected peer group of 17

32 banking institutions to be used for evaluating 2016 compensation. These included thrift and banking institutions with assets of $14.6 billion to $48.6 billion, having an asset mix similar to Investors Bancorp and doing business predominately in the Northeast and Central regions of the United States.

The 17 peer comparator companies selected for inclusion in the Compensation and Benefits Committee’s evaluation of 2016 compensation represented a group of companies whose aggregate Average and Median performance on the above-specified banking industry metrics closely approximated that of Investors Bancorp. As has been the practice of our Compensation and Benefits Committee, the composition of this peer group is carefully reviewed and appropriately modified from year-to-year based on several factors, including significant changes and developments in the size, scope, business mix and financial condition of Investors Bancorp and each of the potential peer comparators. In addition, the Compensation and Benefits Committee considers the impact of completed mergers and acquisitions activity in our geographic region and relevant areas of competitive banking operations, as well as other publicly-announced business combinations within the broader banking industry. The Compensation and Benefits Committee also considers pertinent competitive industry knowledge and information provided by its compensation advisors and senior management.

Changes in Peer Group – 2015 to 2016 Regarding the changes in the composition of our selected peer group of comparator companies from 2015 to 2016, the Compensation and Benefits Committee eliminated eight banking companies and added seven other banking companies which resulted in the reduction in the size of our selected comparator group from a total of 18 peer companies to a revised total of 17 peer companies. The eight banking companies eliminated from 2015 were eliminated as a result of merger/acquisition activity or asset size (total assets of less than $10 billion). The seven banking companies added each had similar business models and total assets of between $15 billion and $25 billion.

Companies Removed Companies Added Due to Merger/Acquisition: Due to Size: Astoria Financial Corp. Dime Community Bancshares Associated Banc-Corp TCF Financial Corporation First Niagara Financial Group, Inc. Flushing Financial Corp. Commerce Bancshares Inc. UMB Financial Corporation Susquehanna Bancshares NBT Bancorp, Inc. F.N.B. Corporation Umpqua Holdings Corporation Northwest Bancshares, Inc. IBERIABANK Corporation Provident Financial Services, Inc.

2016 Peer Group As a result, the group of companies approved by the Compensation and Benefits Committee for the evaluation of 2016 Named Executive Officer compensation consisted of the 17 peer banking institutions identified below: PROXY STATEMENT Associated Banc-Corp-WI IBERIABANK Corporation-LA UMB Financial Corporation-MO BankUnited, Inc.- FL MB Financial, Inc.- IL Umpqua Holdings Corporation-OR Commerce Bancshares Inc.-MO New York Community Bancorp.-NY Valley National Bancorp.-NJ F.N.B. Corporation-PA People’s United Financial, Inc.-CT Webster Financial Corporation-CT FirstMerit Corporation-OH Signature Bank-NY Wintrust Financial Corporation- IL Fulton Financial Corporation-PA TCF Financial Corporation-MN

33 While our executive compensation program targets each Named Executive Officer’s base salary, annual cash incentives and long-term equity compensation at fully competitive levels commensurate with corporate and personal performance, Investors Bancorp has no formal policy that requires the compensation of the Named Executive Officers to attain any specific percentile position within our peer group. However, the Compensation and Benefits Committee carefully reviewed detailed comparative information provided by its compensation consultant regarding the cash and stock compensation of each Named Executive Officer for the fiscal year ending December 31, 2015, which included the following items:  A detailed comparative study of the cash and stock compensation of the Named Executive Officers of the selected peer companies on a functionally position-matched basis.  Statistical Median and Average value of the detailed array of comparative executive compensation data for each element of Named Executive Officer compensation o base salary; o non-equity incentive compensation; o total cash compensation; o stock option present value at the date of award; o restricted stock present value at the date of award; and o total direct compensation

This comparative compensation study also includes specific information regarding the cash and stock compensation provided to the non-employee Directors of each of the peer comparator companies.

In connection with the Compensation and Benefits Committee’s understanding and utilization of comparative compensation data in the context of its pay-for-performance philosophy, it should be noted that Investors Bancorp’s one-year, three-year and five-year Total Shareholder Returns (TSR) for the period ending December 31, 2015 were 13.2%, 86.0% and 152.8%, respectively, which the Compensation and Benefits Committee regarded as highly competitive and favorable as compared with our selected peer banking companies. For the year ending December 31, 2015, our net income was 99% of the average net income of our RX STATEMENT PROXY seventeen peer banking institutions and our 0.92% return on average assets (ROAA), which is a standard banking industry measure, exceeded the 0.83% ROAA of those seventeen comparator banks.

In understanding and directing the relationship between Investors Bancorp’s corporate performance and its Named Executive Officers’ compensation, the Compensation and Benefits Committee is focused on balancing its consideration of Investors Bancorp’s short-term financial results versus the Company’s long-term economic growth and increasing shareholder value. With a clear recognition of senior management’s demanding operational challenges in leading and managing a fast-growing business enterprise over the past decade, the Compensation and Benefits Committee endeavors to fairly apply its pay-for-performance philosophy with a view towards both the critical decisions and actions taken by the senior management team on a day-to-day basis, as well as the strategies and initiatives regularly implemented by management that have built and sustained our corporate reputation as a successful, stable and trustworthy financial institution. It is important to the Compensation and Benefits Committee not only to administer Named Executive Officer compensation to meet prevailing banking industry levels and standards, but also to ensure that senior management continues to take a hard-working, reasonable and balanced approach to Investors Bancorp’s short- term and long-term condition and performance.

Given the availability of a substantial amount of directly relevant comparative financial and compensation information, as well as the Compensation and Benefits Committee’s careful review and interpretation of this information with the assistance of its consultant, the Company believes that the 2016 executive compensation program for the Named Executive Officers was appropriate relative to our corporate goals and relative to our peer group because it continued to be commensurate with our growth and strong corporate performance, as well as each Named Executive Officer's individual contributions and experience. We believe our 2016 executive

34 compensation program is consistent with our performance-based approach based on our business results relative to our peers, as well as the overall market conditions in our geographical area and nationally. We therefore believe that our administration of Named Executive Officer compensation continues to be reasonable and fully consistent with our ongoing pay-for-performance philosophy.

Elements of Executive Compensation for 2016 The Compensation and Benefits Committee used a total compensation approach in establishing our elements of executive compensation, which consist of base salary, annual cash incentive awards, long-term incentive awards (such as stock option and restricted stock awards), a competitive benefits package and limited perquisites.

Base Salary Base salary is the primary fixed component of our executive compensation package for our Named Executive Officers. Base salary levels for the Named Executive Officers are evaluated by the Compensation and Benefits Committee on an annual basis. In general, base salaries are reviewed considering the experience and market value of each Named Executive Officer based on the competitive executive salary information furnished to the Compensation and Benefits Committee by GK Partners. Specifically, each Named Executive Officer’s base salary level is determined by his sustained individual performance, leadership, operational effectiveness, tenure in office, experience in the industry and employment market conditions in our geographical area. In determining base salary adjustments for 2016, the Compensation and Benefits Committee considered Investors Bancorp’s financial performance, and peer group and market-based industry salary data provided by GK Partners, our independent consultant, as well as the individual factors identified above. Based on this analysis, the Compensation and Benefits Committee made no changes to the base salary amounts for each Named Executive Officer for 2016.

The following table sets forth for the calendar years ended December 31, 2016, 2015 and 2014 salary earned to Named Executive Officers:

Executive Officer 2016 Salary ($) 2015 Salary ($) 2014 Salary ($) Kevin Cummings 1,000,000 1,000,000 1,000,000 Domenick A. Cama 675,000 675,000 675,000 Richard S. Spengler 430,000 430,000 430,000 Paul Kalamaras 415,000 415,000 415,000 Sean Burke(1) 400,000 376,923 N/A

(1) Mr. Burke was appointed Senior Vice President and Chief Financial Officer on January 26, 2015. Mr. Burke’s 2015 full year annualized base salary was $400,000. PROXY STATEMENT Executive Officer Annual Incentive Plan The Executive Officer Annual Incentive Plan was adopted, and approved by shareholders, in 2013 such that, under Section 162(m) of the Internal Revenue Code, awards issued under the plan may be treated as performance-based compensation for purposes of the exemption from the $1 million limit on deductibility of compensation paid to each Named Executive Officer of a publicly traded company (other than the principal financial officer). Ms. Byrnes did not participate in any decisions related to the annual incentive awards issued to the Named Executive Officers in 2016 because as a former officer of Investors Bank, she is not an “outside director” as determined under Code Section 162(m). Each of the Named Executive Officers participated in the Executive Officer Annual Incentive Plan in 2016.

The Compensation and Benefits Committee assigns corporate financial targets and individual performance goals and a range of annual cash incentive award opportunities to each executive officer, or group

35 of officers participating in the plan. The award opportunities for each Named Executive Officer are linked to specific targets and range of performance results for both annual corporate financial performance and individual goals. In the context of the structure of the Investors Bancorp Executive Officer Annual Incentive Plan, the use of individual goals represents the clear assignment by the Board and its Compensation and Benefits Committee of direct personal accountability for specific financial, organizational, operational, risk management, and information systems objectives to one or more of our Named Executive Officers. In this context, the individual goals assigned by the Compensation and Benefits Committee are quantifiable, measurable and otherwise verifiable performance objectives, the attainment of which contribute significantly to the growth, profitability, productivity and efficiency of our business operations and corporate health.

In many cases, these individual goals include personal accountability on the part of one or more Named Executive Officer (including the Chief Executive Officer) for critical performance with respect to standard banking industry and other public company metrics (e.g., deposit growth, efficiency ratio, loan delinquency, regulator/investor relations, marketing, and other such goals). In our view, the assignment of personal accountability in the form of individual goals has served to strength the effectiveness our executive compensation program, and continues to have a significant positive impact on our managerial performance. The Company believes that this incentive plan structure allows our Named Executive Officers to effectively plan, organize, supervise, monitor and evaluate the key functional areas and departments for which they are responsible, and through which our most important corporate objectives are achieved.

In recent years, our Chief Executive Officer’s personal goals have been weighted as 40% of his incentive award opportunity with a weighting of 60% given to corporate objectives. Particularly with respect to our Chief Executive Officer and Chief Operating Officer, the personal goals assigned by the Compensation and Benefits Committee are fundamentally “corporate goals” in that they are aligned closely with our strategic objectives for growth, productivity, profitability and risk management. The Company believes that the Chief Executive Officer’s and the Chief Operating Officer’s direct personal accountability for the achievement of objectively measurable and verifiable goals that are particularly relevant to our industry, our strategy, and our stage of corporate development has contributed in a meaningful way to our success.

Each Named Executive Officer's annual cash incentive award is defined as a percentage of base salary. The corporate financial targets and individual goals are established by the Compensation and Benefits

RX STATEMENT PROXY Committee no later than 90 days after the commencement of the period of service to which the performance goal relates, but in no event after 25% of the performance period has elapsed, and in either case, so long as the outcome is substantially uncertain at the time that the goal is established. Such targets and goals are weighted in relation to the Named Executive Officer's position and duties. As corporate financial targets and/or individual performance goals exceed or fall short of achievement levels (which are established at Threshold, Target and Maximum Achievements), the actual amount paid under the plan will exceed or fall short of the targeted payment amount.

36 Annual Incentive Opportunity As stated above, the Compensation and Benefits Committee did not increase the base salary of any of our Named Executive Officers during 2015 and similarly, there were no salary increases during 2016. However, the Compensation and Benefits Committee also regularly evaluates the level of annual incentive compensation, including the annual incentive compensation opportunity available to each of our Named Executive Officers based on the Company’s growth and financial performance, as well as peer competitive compensation practices, and overall marketplace conditions. The Company’s objective is to continue to provide annual incentive opportunities that are commensurate with our annual financial and operational results, as well as each Named Executive Officer’s personal contribution to those results. In that context, the Committee determined that an increase in each Named Executive Officer’s annual incentive opportunity was warranted considering the following important factors directly related to the Company’s ongoing transformation into a larger and more successful financial institution:  The Company’s continued consistent and profitable growth in assets;  The Company’s extraordinary track record of identifying, negotiating, closing and integrating strategic acquisitions during the period from 2008 to 2014;  The Company’s successful 2015 Second Step Conversion and related public offering resulting in new equity capital of $2.2 billion;  The consecutive annual increases in net income;  The significant enhancement and upgrading of our core operating system;  Successful recruitment of integral senior management personnel; and  The increase placed greater emphasis on performance as a percentage of total compensation.

Therefore, in 2015, the Compensation and Benefits Committee determined to increase the maximum annual incentive compensation opportunity of each of the Named Executive Officers consistent with the increasing size and scope of their management responsibilities, their individual accountability for corporate results, and the actual incentive compensation amounts paid to named executives among our comparator companies. The effect of these increases in maximum incentive opportunity was to increase the percentage of each Named Executive Officer’s total cash compensation that is directly performance-driven. Currently, at Investors Bancorp, each Named Executive Officer is eligible to receive an annual cash incentive award in the range of zero to a maximum percent of base salary that is specified below for each executive. Among our Named Executive Officers (other than the Chief Executive Officer), these maximum cash incentive opportunities range from 100% of base salary to 160% of base salary. The maximum cash incentive opportunity for our Chief Executive Officer is 200% of base salary. Actual 2015 incentive compensation to the CEOs of our seventeen comparator banks ranged from a low of 37% of base salary to a high of 400% of base salary with an average of 143% of base salary. PROXY STATEMENT

37 2016 Incentive Opportunity For 2016, the Compensation and Benefits Committee established the following range of annual cash incentive award opportunities for Threshold, Target and Maximum Achievements as a percentage of base salary:

Executive Officer Threshold (1) Target (1) Maximum Kevin Cummings 122.0% 161.0% 200.0% Domenick A. Cama 97.6% 128.8% 160.0% Richard S. Spengler 81.0% 100.5% 120.0% Paul Kalamaras 81.0% 100.5% 120.0% Sean Burke 67.5% 83.75% 100.0%

(1) Assumed 100% achievement of all individual goals.

The Compensation and Benefits Committee weighted each Named Executive Officer's 2016 annual cash incentive award opportunity under the plan (as a percentage of the total award opportunity) with respect to corporate financial targets and individual goals as follows:

Corporate Financial Individual Executive Officer Targets Goals Kevin Cummings 60% 40% Domenick A. Cama 60% 40% Richard S. Spengler 50% 50% Paul Kalamaras 50% 50% Sean Burke 50% 50%

The Compensation and Benefits Committee feels strongly that executive compensation should be formally tied to the attainment of certain corporate financial targets and individual performance goals to more closely align the executive’s performance with providing value for our stockholders. The corporate financial

RX STATEMENT PROXY targets for 2016 were based on: (1) net income, weighted at 70%; and (2) enhanced risk management, weighted at 30%.

The Compensation and Benefits Committee established the following corporate financial targets for net income:

Metric Weighting Threshold Target Maximum Net Income 70% $173 million $177 million $181 million

The net income goals at threshold, target and maximum were 12%, 11% and 10% higher than the corresponding net income goals for 2015. In establishing the net income goal, management discussed with the Compensation and Benefits Committee some specific challenges in attaining the 2016 net income projection. The first factor was the change to forecasted interest rates utilized for the business plan in light of the current consensus forecast as a result of several macro-economic factors occurring in the market. The second factor was the continued build out of the risk management and operational infrastructure. Based these factors, the Compensation and Benefits Committee concluded that the net income corporate goal appeared reasonable and challenging.

The enhanced risk management was viewed by the Compensation and Benefits Committee as a company- wide performance target metric, as many groups within the Bank worked towards its achievement. In establishing the enhanced risk management goal, management discussed with the Compensation and Benefits Committee the Company’s strong growth in recent years and given the size and future growth expectations

38 management believed that a robust risk management structure and culture was the most important strategy to focus on during 2016. The Compensation and Benefits Committee agreed with this assessment.

In comparing the target percentages to the 2015 incentive opportunity, the change in the target is directly tied to the weighting of corporate financial targets. For both 2016 and 2015 Net Income goals were given specific amounts for threshold, target and maximum achievement with weightings being the same in both years. For 2016, the enhanced risk management goal was weighted at 0%, 50%, and 100% at the threshold, target and maximum. For 2015, the corporate financial target related to the completion of the core operating system goal was weighted at 0%, 0%, and 100% at the threshold, target and maximum.

The individual goals established by the Compensation and Benefits Committee were therefore aligned with each Named Executive Officer's area of responsibility at Investors Bancorp and related to the successful implementation of our strategic initiatives. For 2016, each Named Executive Officer's individual goals were related to the following:  Messrs. Cummings’ and Cama’s individual goals included achieving certain core deposit growth, maintaining loan quality versus peers and promoting Investors Bancorp to various audiences, including but not limited to: stockholders, customers, investment bankers, analysts and employees. In establishing the individual goals of both Messrs. Cummings and Cama the Compensation and Benefits Committee considered the following for each: o Deposits are the primary source of funds used for our lending and investment activities. Low cost core deposits are essential to fund our continued growth. o One of the Company’s key operating objectives has been, and continues to be, maintaining a high level of loan quality to ensure that Investors Bancorp does not take any undue risk.  Mr. Spengler’s individual goals included achieving certain loan growth, maintaining loan quality versus our peers and growing deposits for new loan customers.  Mr. Kalamaras’ individual goals included achieving growth in certain core deposit, loan and non- deposit investment products.  Mr. Burke's individual goals were related to the successful execution of the strategic plan and budget approval by the Board of Directors, DFAST process enhancements and submission as well as the implementation of a new ALM model and profitability system.

2016 Incentive Achievement For 2016, the net income utilized for evaluation of the corporate goal achievement was $182.6 million which met the Maximum achievement level. For purposes of evaluating net income, adjustments were made to recorded net income as it included both the early adoption of ASU 2016-09 related to the accounting of stock

compensation and compensation expenses related to the accelerated vesting of equity awards upon the death of PROXY STATEMENT our director, Brendan Dugan, see reconciliation below:

2016 Net Income $ 192,125 Compensation and fringe benefits 878 Income taxes (10,414) Adjusted net income $ 182,589

For the enhanced risk management goal, there were four criteria which needed to be met. The Compensation and Benefits Committee determined that based on the information provided, the achievement of the enhanced risk management goal was assessed at 50%. Based upon the foregoing and the assessment of the Named Executive Officer’s individual performance relative to his pre-established individual goals, the

39 Compensation and Benefits Committee approved the following annual cash incentive awards on January 23, 2017:

2016 Annual Cash Incentive Awards

Bonus Guidelines Achievement Eligible Maximum Corporate Individual Corporate Individual Cash Percent of Executive Officer Earnings ($) Bonus (%) Goals Goals Goals Goals Incentive ($) Salary Kevin Cummings 1,000,000 200% 60% 40% 85% 100% 1,820,000 182% Domenick A. Cama 675,000 160% 60% 40% 85% 100% 982,800 146% Richard S. Spengler 430,000 120% 50% 50% 85% 96.4% 468,012 109% Paul Kalamaras 415,000 120% 50% 50% 85% 100% 460,650 111% Sean Burke 400,000 100% 50% 50% 85% 100% 370,000 93%

Other Elements of Compensation 2015 Equity Incentive Plan At the annual meeting of stockholders held on June 9, 2015, stockholders of the Company approved the Investors Bancorp, Inc. 2015 Equity Incentive Plan (“2015 Equity Plan”). Under this plan, individuals may receive awards of Investors Bancorp common stock (restricted stock) and grants of options to purchase shares of Investors Bancorp common stock at a specified exercise price during a specified time period. The 2015 Equity Plan provides for the issuance or delivery of up to 30,881,296 shares (13,234,841 restricted stock awards and 17,646,455 stock options) of Investors Bancorp common stock.

During the year ended 2016 the Company awarded 276,890 restricted stock awards and 201,440 options under the 2015 Equity Plan. None of the 2016 grants were issued to Named Executive Officers. On June 23, 2015, Investors Bancorp granted to executive officers, employees and directors a total of 6,849,832 restricted stock awards and 11,576,612 stock options to purchase Investors Bancorp common stock. Of the 2015 grant, a total of 3,333,333 restricted stock awards and 4,453,331 stock options were awarded to Named Executive Officers. As a result of these grants, the CEO’s total beneficial stock ownership of Investors Bancorp stock was RX STATEMENT PROXY 0.9% of common stock outstanding on that date. The Compensation and Benefits Committee reviewed comparable levels of beneficial stock ownership among the CEOs of the Company’s peer comparator group, which showed an average of 1.4% shares outstanding per CEO. The 2015 grant of stock awards was effective in increasing the CEO’s potential for additional stock ownership and thereby reinforcing his alignment of long- term economic interest with all Company shareholders.

The Compensation and Benefits Committee believes that officer and employee stock ownership provides a significant incentive in building stockholder value by further aligning the interests of our officers and employees with stockholders because such compensation is directly linked to the performance of Investors Bancorp common stock. This element of compensation increases in importance as Investors Bancorp, Inc. common stock appreciates in value and serves as a retention tool for executives. The inclusion of performance- vesting awards also encourages long-term strategic focus of our executives.

Background From 2007 through 2015, Investors Bancorp experienced substantial growth in assets, revenues and profitability based on senior management’s and the Board’s consistent and concerted efforts. With oversight from the Board, the Named Executive Officers successfully executed the Company’s long-term business strategy which resulted in the transformation of Investors Bancorp from a relatively small community-based banking organization into a much larger, nationally-recognized, and financially strong institution. We believe that senior management was particularly successful in achieving the long-term strategic objectives approved by our Board, and in the process, Investors Bancorp has become a substantially larger, stronger and more profitable

40 company. Investors Bancorp’s senior management team successfully completed its Second Step Conversion, raising $2.2 billion of equity that resulted in Investors Bancorp becoming a fully-public company.

In light of the Company’s growth and success and its resulting Second Step Conversion and given that no further stock grants were available under the Investors Bancorp 2006 Equity Plan, the Company believed that a new management stock incentive compensation plan was clearly necessary and warranted as an essential element of its overall executive compensation program. The establishment and structure of the 2015 Equity Incentive Plan was in line with prevailing marketplace executive compensation practices, as well as the precedents established by other banking companies both in their initial conversions to public ownership and in their ongoing administration of executive compensation as exchange-listed companies.

The Company undertook the following in establishing the 2015 Equity Plan approved by Investors Bancorp shareholders:  Researched comparative financial and compensation data;  Reviewed directly-related marketplace precedents concerning similar equity compensation plans implemented by the Company’s regional competitors at the time of their respective public offerings and conversions from mutual holding companies (MHCs) to exchange-listed companies;  The Board set an overall limit of 14% of the shares sold in the Company’s Second Step Conversion; and  Received relevant data concerning the appropriate percentages and number of shares typically awarded to the Chief Executive Officer and other Named Executive Officers of competing banks at the time of their “second step” public offerings.

Emphasis on Retention of Key Management In granting the June 2015 stock awards to the Chief Executive Officer and the other Named Executive Officers, our Compensation and Benefits Committee and Board intended to recognize and reward what had been accomplished by our senior management team, but most importantly, the Compensation and Benefits Committee wished to ensure the retention and stability of those high-performing key executives (who are individually and collectively responsible for Investors Bancorp’s growth and success) going forward. These stock awards were made at an important milestone in the Company’s history, namely, its conversion to a fully public company, and were atypical in nature. The Company does not anticipate that any future awards of stock compensation to the Named Executive Officers will be similar to the 2015 grant in size or in potential compensation value.

Longer Vesting Term

Since the June 2015 stock awards were primarily focused on the future retention and stability of our key PROXY STATEMENT management team, 75% of the awards were made in the form of time-vested restricted stock with seven-year vesting. We believe that our seven-year vesting schedule is an extraordinarily long and stringent requirement as compared to the compensation practices of our peers, and that it will ensure the strong retention of our key executives in the years ahead. Also, the June 2015 stock awards included competitively-based awards of stock options with an option exercise price (“strike price”) of $12.54 per share. We believe that these stock options, whose value are dependent on the performance of Investors Bancorp Inc. stock are a motivational and cost- effective element of our long-term management incentive program, and that they will create a strong mutuality of economic interest with all our shareholders.

Greater Emphasis on Performance-Based Equity Awards The Compensation and Benefits Committee also approved strict performance-vesting requirements for 25% of the 2015 stock awards that were not stock options or time-vested restricted stock. The June 2015

41 performance-based stock awards included three key banking industry performance metrics that our Compensation and Benefits Committee and Board believe are accurate indicators of our long-term, multi-year corporate performance. Two of the three performance metrics will measure our financial performance relative to our peer compensation comparators (i.e., the seventeen banking companies listed in the Market Comparison section that our Compensation and Benefits Committee utilizes for its annual marketplace research and benchmarking of executive compensation amounts and practices). Our performance on these indicators will be measured over a three-year performance period ending on December 31, 2017. If all or any portion of these performance-based stock awards are thereby earned by participating executives, the vesting and payout of any earned shares will be 1/3 at the end of the three-year performance period, 1/3 one year thereafter, and 1/3 two years thereafter (resulting in a total performance and vesting period of five years). The Company believes that the five-year period for performance-vested stock awards is longer and stricter than what is found in similar stock compensation programs among our competitors. The selected performance metrics for the 2015 performance-based stock awards are described in detail below.

The performance-based restricted stock that is deemed to have been earned at the conclusion of a three- year performance (i.e., the specific number of shares earned based on Investors’ three-year performance, and thereafter subject to further time-vesting and subsequent distribution to the participating executives) is based on the satisfaction of the following performance metrics: (1) Net Charge-Offs as a Percentage of Average Loans and Leases vs. Peers; (2) Return on Average Tangible Core Equity vs. Pre-Established Board-Approved Strategic Plan; and (3) Total Shareholder Return vs. Peers. The peer group is established by the Compensation and Benefits Committee with input from our independent compensation consultant and is currently comprised of companies with asset sizes ranging from approximately $14.6 billion to $48.6 billion.

 Net Charge-Offs as a Percentage of Average Loans and Leases vs. Peers. Up to 40% of the Performance-Based Restricted Stock can be earned based on the following:

If Investors Bancorp’s 3-year If Investors Bancorp’s 3-year If Investors Bancorp’s 3-year average peer percentile is equal average peer percentile is 51st average peer percentile is 66th to or less than 50th percentile percentile to 65th percentile percentile or higher 40% of Shares vest 20% of Shares vest 0% of Shares vest

RX STATEMENT PROXY  Return on Average Tangible Core Equity vs. Board-Approved Strategic Plan. 30% of the Performance-Based Restricted Stock can be earned based on the following:

If Investors Bancorp’s 3 year average Return on If Investors Bancorp’s 3 year average Return on Average Tangible Core Equity is equal to or Average Tangible Core Equity is less than that greater than that projected in the 2014 Strategic projected in the 2014 Strategic Plan Plan 30% of Shares vest 0% of Shares vest

 Total Shareholder Return vs. Peers. 30% of the Performance-Based Restricted Stock can be earned based on the following:

If Investors Bancorp’s 3 year TSR is equal to or If Investors Bancorp’s 3 year TSR is less than greater than the 50th percentile the 50th percentile 30% of Shares vest 0% of Shares vest

Following the completion of the three-year performance period, the Performance-Based Restricted Stock that has been earned based on the satisfaction of the foregoing performance metrics will be subject to further service requirements (i.e., time-vesting) such that 1/3 of such earned shares will be vested on February 15, 2018, 1/3 on February 15, 2019 and 1/3 on February 15, 2020. No dividends will be paid with respect to any stock award subject to performance-vesting conditions unless and until the performance conditions are met and vesting occurs, and only on that portion of the stock award that actually vests.

42 Future Grants under the 2015 Equity Incentive Plan The Compensation and Benefits Committee carefully and diligently reviews all elements of compensation for the Named Executive Officers on an annual basis. As the June 2015 awards were atypical in nature, future stock awards granted to the Named Executive Officers will not be similar in size or potential value. The future use of stock incentive compensation as an element of executive compensation will depend on the below factors:  Named Executive Officers’ individual and company performance;  the condition of management leadership and succession, as well as other organizational needs of the Company;  pertinent comparative compensation data provided by our compensation advisors; and  prevailing marketplace compensation practices, good corporate governance principles, and competitive business requirements at various points in the future.

The Compensation and Benefits Committee is aware of the use of performance-based restricted stock awards made by its selected peer comparator companies in recent years and expects that future awards of stock incentive compensation to the Named Executive Officers will be weighted more towards performance. In addition, the Compensation and Benefits Committee has determined that no additional awards of any form of stock compensation will be made to the CEO and the COO until the completion of the current three-year performance period, which ends on December 31, 2017. The Compensation and Benefits Committee may consider additional awards in the future to ensure a sound and competitive executive compensation program.

2006 Equity Incentive Plan At the October 24, 2006 annual meeting of stockholders, the stockholders approved the Investors Bancorp, Inc. 2006 Equity Incentive Plan (“2006 Equity Incentive Plan”). Under this plan, individuals received awards of Investors Bancorp common stock (restricted stock) and grants of options to purchase shares of Investors Bancorp common stock at a specified exercise price during a specified time period. Upon completion of the Second Step Conversion and related stock offering on May 7, 2014, vesting accelerated for all stock options and stock awards outstanding and all applicable expenses were recognized at that time. No further grants will be made under the 2006 Equity Incentive Plan or under any equity incentive plan previously maintained by any entity that we acquired.

Benefits Investors Bank provides its executives, including the Named Executive Officers, with medical and dental insurance, disability insurance and group life insurance coverage consistent with the same benefits provided to all of its full-time employees. The Named Executive Officers are participants in our qualified retirement plans, including the ESOP, and 401(k) Plan offered to all full-time employees of Investors Bank and designated PROXY STATEMENT subsidiaries, and the Bank’s non-qualified Supplemental ESOP and Retirement Plan (“SERP I”). The Named Executive Officers have accrued benefits under the Defined Benefit Plan and SERP II that were each frozen as of December 31, 2016. Additionally, Investors Bank sponsors a long-term care program for certain of its executive officers, senior vice presidents and their spouses or spousal equivalents. Each individual policy is owned by the covered person. Investors Bank pays all premiums under the long term care program but will stop paying premiums in the event of the participant’s: (i) termination for cause; (ii) retirement; (iii) relocation outside of the country; or (iv) death. Spousal coverage will be terminated upon: (i) a participant’s termination or retirement; (ii) divorce from the participant; (iii) the participant no longer qualifying for coverage; (iv) the spouse’s permanent relocation outside of the country; or (v) death. Participants who cannot be insured through an insurance company under the long-term care program will be self-insured by Investors Bank.

43 ESOP Under the ESOP, employees of Investors Bank and any subsidiary (unless excluded by the ESOP) who have been credited with at least 1,000 hours of service during a 12-month period are eligible to participate in the ESOP. In 2005, the ESOP utilized proceeds from a loan made to it by Investors Bancorp to purchase 10,847,883 shares of common stock for the ESOP in connection with Investors Bancorp’s initial public offering in 2005. In connection with the completion of the Second-Step Conversion and related stock offering on May 7, 2014, the ESOP purchased an additional 6,617,421 shares of common stock. The Company refinanced the outstanding principal and interest balance of $33.9 million and borrowed an additional $66.2 million to purchase the additional shares. The purchased shares serve as collateral for the loan. The loan is being repaid principally through annual contributions to the ESOP by Investors Bank and dividends paid on the unallocated ESOP shares over the 30 year loan. Shares purchased by the ESOP are held in a suspense account for allocation among the participants’ accounts as the loan is repaid on a pro-rata basis.

Contributions to the ESOP and shares released from the suspense account in an amount proportional to the repayment of the ESOP loan will be allocated to each eligible participant’s plan account, based on the ratio of each participant’s compensation to the total compensation of all eligible participants. Vested benefits will be payable generally upon the participants’ termination of employment, and will be paid in the form of Investors Bancorp common stock. Pursuant to FASB ASC Topic 718-40, we are required to record a compensation expense each year in an amount equal to the fair market value of the shares released from the suspense account.

401(k) Plan Investors Bank maintains the 401(k) Plan, a tax-qualified defined contribution retirement plan, for all employees who have satisfied the 401(k) Plan’s eligibility requirements. All eligible employees may begin participation in the 401(k) Plan on the first day of the plan year or the first day of the month following the date on which the employee attains age 21. A participant may contribute up to 60% of his or her compensation to the 401(k) Plan on a pre-tax basis, subject to the limitations imposed by the Internal Revenue Code. For 2016, the salary deferral contribution limit is $18,000. However, a participant over age 50 may contribute an additional $6,000 to the 401(k) Plan. A participant is always 100% vested in his or her salary deferral contributions. In addition to salary deferral contributions, the 401(k) Plan provides that Investors Bank will make an employer RX STATEMENT PROXY contribution equal to 50% of the participant’s salary deferral contribution, provided that such amount does not exceed 6% of the participant’s compensation earned during the plan year. Participants will become 100% vested in their employer contributions after completing three years of credited service (which is a three-year cliff vesting schedule). However a participant will immediately become 100% vested in any employer contributions upon the participant’s disability or attainment of age 65 while employed with Investors Bank. Generally, unless a participant elects otherwise, the participant’s benefit under the 401(k) Plan is generally payable in the form of a lump sum payment as soon as administratively feasible following his or her termination of employment with Investors Bank, provided, however that a participant can elect to receive a distribution of his or her vested account upon attaining age 59 1⁄2.

Each participant has an individual account under the 401(k) Plan and may direct the investment of his or her account among a variety of investment options or vehicles available. In connection with the Second-Step Conversion and related stock offering, each participant was eligible to make a one-time purchase of Investors Bancorp common stock through the 401(k) Plan, provided that the purchase did not exceed 50% of the participant’s account balance. Investors Bancorp common stock is not currently an investment option available under the 401(k) Plan.

Defined Benefit Pension Plan As of December 31, 2016 the annual benefit provided under the Defined Benefit Plan was amended to freeze the plan. Freezing the plan eliminates all future benefit accruals and each participant’s frozen accrued benefit was determined as of December 31, 2016 and no further benefits will accrue beyond such date.

44 Investors Bank participates in the Pentegra Defined Benefit Plan for Financial Institutions, formerly known as the Financial Institutions Retirement Fund, which is a tax-qualified defined benefit pension plan (the “Defined Benefit Plan”). All employees age 21 or older who have completed one year of employment with Investors Bank are eligible for participation in the Defined Benefit Plan the first of the month following their one year anniversary; however, only employees who have been credited with 1,000 or more hours of service with Investors Bank are eligible to accrue benefits under the Defined Benefit Plan. Effective with the freezing of the plan on December 31, 2016, employees hired after November 30, 2015 would be ineligible for participation in the plan as they would not meet the service eligibility requirement. Investors Bank annually contributes an amount to the plan necessary to satisfy the minimum funding requirements established under the Employee Retirement Income Security Act of 1974, as amended (“ERISA”).

The retirement benefit formula under the Defined Benefit Plan provides for a nonintegrated unit accrual formula with an annual accrual rate of 1.25% of the participant’s high five year average salary, with a 30-year salary cap. A participant’s average annual compensation is the average annual compensation over the five consecutive calendar years out of the last 10 calendar years in which the participant’s compensation was the greatest, or over all calendar years if less than five.

The regular form of retirement benefit is a straight life annuity (if the participant is single) and a joint and survivor annuity (if the participant is married). However, various alternative forms of joint and survivor annuities may be selected instead. If a participant dies while in active service, and after having become fully vested, a qualified 100% survivor benefit will be payable to the participant’s beneficiary. Benefits payable upon death may be paid in a lump sum, installments, or in the form of a life annuity. Upon termination of employment due to disability, the participant will be entitled to a disability retirement benefit at age 65.

SERP I SERP I is intended to compensate certain executives participating in the Defined Benefit Plan and the ESOP whose contributions or benefits are limited by Sections 415 and/or 401(a)(17) of the Internal Revenue Code, applicable to tax-qualified retirement plans (the “Tax Law Limitations”). As of December 31, 2016, Messrs. Cummings, Cama, Spengler, Kalamaras and Burke were participants in the SERP I.

SERP I provides benefits attributable to participation in the Defined Benefit Plan equal to the excess, if any, of the vested accrued benefit to which the participant would be entitled under the Defined Benefit Plan, determined without regard to the Tax Law Limitations, over the vested accrued benefit to which the participant is actually entitled under the Defined Benefit Plan, taking into account the Tax Law Limitations (the “Supplemental Retirement Plan Benefit”).

SERP I also provides benefits attributable to participation in the ESOP equal to the difference between the allocation of shares of Investors Bancorp common stock the participant would have received under the ESOP

without regard to the Tax Law Limitations, and the number of shares of stock that are actually allocated as a PROXY STATEMENT result of the Tax Law Limitations (the “Supplemental ESOP Benefit”). The Supplemental ESOP Benefit under the plan is denominated in phantom shares of stock such that one phantom share has a value equal to the fair market value of one share of Investors Bancorp common stock. Each participant’s phantom shares are held in a bookkeeping account established on his or her behalf. Each plan year, the dollar amount of appreciation on the phantom shares deemed allocated to each participant’s account will be converted into phantom shares and credited to each participant’s account.

As a long-term compensation plan, the participant’s vested interest in the Supplemental Retirement Plan Benefit and in the Supplemental ESOP Benefit is based on a five-year cliff vesting schedule where participants with less than five years of employment will not be vested in their benefits, and will become 100% vested upon the completion of five years of employment.

In the event of a participant’s separation from service prior to attainment of age 55, the participant’s accrued Supplemental Retirement Plan Benefit will be paid in a single lump sum payment within 30 days of the

45 participant’s separation from service. In the event of separation from service after age 55, the participant’s Supplemental Retirement Plan Benefit will be payable upon the participant’s early retirement date (age 55 with 10 years of service) or normal retirement date (age 65 with five years of service) in either a lump sum or an annuity (single life, single life with 120 months guaranteed, joint and 100% survivor annuity or joint and 50% survivor annuity) as elected by the participant, subject to the requirements of Section 409A of the Internal Revenue Code. In the event of a participant’s separation from service within two years following a change in control (as defined in the Plan), the participant will receive his Supplemental Retirement Plan Benefit in a lump sum within 30 days after his separation from service. The participant’s Supplemental ESOP Benefit will be payable in cash in either a lump sum or annual installments over a period not to exceed five years, as elected by the participant, and will commence within 30 days following the earlier of the participant’s: (i) separation from service, (ii) death or (iii) disability, subject to the requirements of Section 409A of the Internal Revenue Code. Notwithstanding the foregoing, in the event the participant is a “specified employee”, as defined under Section 409A of the Internal Revenue Code, no benefit will be payable under the plan during the first six months following the participant’s separation from service (except in the event of death or disability).

SERP II SERP II was frozen effective as of the close of business on December 31, 2016. SERP II was originally designed to provide participants with a normal retirement benefit, which is an annual benefit equal to 60% of the participant’s highest average annual base salary and cash incentive (over a consecutive 36-month period within the participant’s credited service period) reduced by the sum of the benefits provided under the Defined Benefit Plan and the annuitized value of his or her benefits payable from the defined benefit portion of the SERP I (which is referred to above as the Supplemental Retirement Plan Benefit).

The SERP II was amended to freeze future benefit accruals, and for certain participants, structure the benefits payable attributable solely to the participants’ 2016 year of service to vest over a two-year period such that the participants would have a right to 50% of their accrued benefits attributable to their 2016 year of service as of December 31, 2016, which will become 100% vested provided the participants remained continuously employed through and including December 31, 2017. As a result, each participant would be entitled to receive his vested frozen accrued benefit as of December 31, 2016, upon his qualifying termination event (the “Frozen Accrued Benefit”). In the event that the participant’s Termination Event (as defined below) occurs prior to RX STATEMENT PROXY attaining age 65, the Frozen Accrued Benefit would be subject to further reduction by multiplying the Frozen Accrued Benefit by a percentage equal to: (i) 2% multiplied by (ii) the numerical difference between 65 and the participant’s age on the date of his termination, provided, however, that if: (i) the participant has completed 25 years of employment with Investors Bank as of his date of termination; or (ii) the participant’s termination is due to death or disability, the participant’s Frozen Accrued Benefit would not be reduced pursuant to the foregoing.

Payment of the Frozen Accrued Benefit (as quantified above) would commence upon the earlier of the participant’s: (i) separation from service; (ii) disability; or (iii) death (the “Termination Event”), which would be paid generally in the form of a life annuity with 120 monthly payments guaranteed, unless the participant elected an alternative form of distribution.

At December 31, 2016, Messrs. Cummings, Cama, Kalamaras and Spengler were participants in the SERP II.

Perquisites The Compensation and Benefits Committee believes that perquisites should be provided on a limited basis, and only to the most senior level of executive officers. As of December 31, 2016, the following perquisites were available for Messrs. Cummings, Cama, Spengler and Kalamaras: (i) club membership; (ii) automobile allowance; (iii) long term care insurance and (iv) an annual medical examination. For Mr. Burke available perquisites included an annual medical examination and long term care insurance.

46 Elements of Post-Termination Benefits Employment Agreements Investors Bancorp entered into employment agreements with each of Messrs. Cummings, Cama, Spengler, Kalamaras and Burke. The employment agreements for Messrs. Cummings, Cama and Spengler were originally entered into on October 11, 2005, the employment agreement for Mr. Kalamaras was originally entered into on August 18, 2008 and the employment agreement for Mr. Burke was entered into on January 26, 2015.

Each of these agreements has an initial term of three years. Unless notice of non-renewal is provided, the agreements renew annually. Each executive is entitled to base salary and is eligible to participate in employee benefit plans and arrangements, including incentive compensation and nonqualified compensation plans, generally made available by Investors Bancorp or Investors Bank to its senior executives and key management employees.

Each executive is entitled to a severance payment and benefits in the event of his termination of employment under specified circumstances. In the event the executive’s employment is terminated for reasons other than for just cause, disability or retirement, provided that such termination of employment constitutes a “separation from service” under Internal Revenue Code Section 409A, or in the event the executive resigns during the term of the agreement following: (i) the failure to elect or reelect or to appoint or reappoint the executive to his executive position; (ii) a material change in the executive’s functions, duties, or responsibilities, which change would cause the executive’s position to become one of lesser responsibility, importance or scope; (iii) the liquidation or dissolution of Investors Bancorp or Investors Bank, other than a liquidation or dissolution caused by a reorganization that does not affect the status of the executive; (iv) a change in control of Investors Bancorp (for Mr. Burke in the event of involuntary termination for any reason other than cause or voluntary termination for good reason); or (v) a material breach of the employment agreement by Investors Bancorp or Investors Bank; then the executive would be entitled to a severance payment equal to three times the sum of his base salary and the highest amount of cash incentive compensation awarded to him during the prior three years, payable in a lump sum. In addition, the executive would be entitled to, at Investors Bancorp’s sole expense, the continuation of nontaxable life and medical, dental and disability coverage for 36 months after termination of employment. The executive would also receive a lump sum payment of the excess, if any, of the present value of the benefits he would be entitled to under any defined benefit pension plan maintained by Investors Bank or Investors Bancorp if he had continued working for Investors Bancorp and Investors Bank for 36 months over the present value of the benefits to which he is actually entitled as of the date of termination. The executives would be entitled to no additional benefits under the employment agreement upon retirement at age 65 or if terminated for just cause.

Should the executive become disabled, Investors Bancorp would continue to pay the executive his base salary for the longer of the remaining term of the agreement or one year, provided that any amount paid to the executive pursuant to any employer-provided disability insurance would reduce the compensation he would PROXY STATEMENT receive. In the event the executive dies while employed by Investors Bancorp, the executive’s estate will be paid the executive’s base salary for one year and the executive’s family will be entitled to continuation of medical and dental benefits for one year after the executive’s death. The employment agreement terminates upon retirement (as defined therein), and the executive would only be entitled to benefits under any retirement plan of Investors Bancorp and other plans to which the executive is a party.

The employment agreements for Messrs. Cummings and Cama also provide for indemnification against any excise taxes which may be owed by the executive for any payments made in connection with a change in control that would constitute “excess parachute payments” under Section 280G of the Internal Revenue Code. The indemnification payment would be the amount necessary to ensure that the amount of such payments and the value of such benefits received by the executive equal the amount of such payments and the value of such benefits the executive would have received in the absence of an excise tax attributable to Sections 280G and 4999 of the Internal Revenue Code, including any federal, state and local taxes on Investors Bancorp’s payment

47 to the executive attributable to such tax. The employment agreements for Messrs. Spengler, Kalamaras and Burke, as amended, provide that the gross benefits under the employment agreements would be reduced to avoid penalties under Section 280G of the Internal Revenue Code if doing so results in a greater after-tax benefit to the executive.

Upon any termination of the executive’s employment, other than a termination (whether voluntary or involuntary) following a change in control as a result of which Investors Bancorp has paid the executive severance benefits, the executive is prohibited from competing with Investors Bank and/or Investors Bancorp for a period of one year following such termination within 25 miles of any existing branch of Investors Bank or any subsidiary of Investors Bancorp or within 25 miles of any office for which Investors Bank, Investors Bancorp or a bank subsidiary of Investors Bancorp has filed an application for regulatory approval to establish an office, determined as of the effective date of such termination, except as agreed to pursuant to a resolution duly adopted by the Board of Directors. The executive is also subject to confidentiality provisions during and after the term of the employment agreement.

Other Matters Stock Ownership Requirements The Board of Directors adopted stock ownership guidelines for our Named Executive Officers that require the following minimum investment in Investors Bancorp common stock:

Chief Executive Officer A number of shares having a market value equal to 5x annual base salary Other Named Executive Officers A number of shares having a market value equal to 3x annual base salary

Equity Retention Policy In 2013, the Board of Directors adopted the Equity Retention Policy, which is independent of the stock ownership guidelines described above. This policy applies to all executive officers of Investors Bancorp and all members of the Board of Directors. Under the policy, each executive officer is required to retain direct RX STATEMENT PROXY ownership of at least 50% of his or her “covered shares,” net of taxes and transaction costs, until three months following the date of the executive officer’s termination of employment. Each director is required to retain direct ownership of at least 50% of his or her “covered shares,” net of taxes and transaction costs, until termination of service from the Board of Directors. A “covered share” means any share acquired by an executive officer or director pursuant to an award granted after July 23, 2013 under any equity compensation plan or other written compensatory arrangement.

Anti-Hedging Policy The Board of Directors adopted an anti-hedging policy, which prohibits directors and executive officers, including the Named Executive Officers, from engaging in or effecting any transaction designed to hedge or offset the economic risk of owning shares of Investors Bancorp common stock. Accordingly, any hedging, derivative or other equivalent transaction that is specifically designed to reduce or limit the extent to which declines in the trading price of Investors Bancorp common stock would affect the value of shares of Investors Bancorp common stock owned by an executive officer or director is prohibited. Cashless exercises of stock options are not deemed short sales and are permitted. This policy does not prohibit transactions involving the stock of other unrelated companies.

Prohibition on Pledging Securities Company policy prohibits directors and executive officers from holding Company securities in a margin account or pledging Company securities as collateral for any other loan. An exception to this prohibition may be

48 granted, in the sole discretion of the Board and in limited circumstances, after giving consideration to, among other factors, the number of shares proposed to be pledged as a percentage of the director’s or executive officer’s total shares held. No shares are currently pledged by a director or executive officer.

Clawback Policy In accordance with a clawback policy adopted by the Board of Directors, as a condition to receiving incentive compensation, Named Executive Officers agree to return bonus and other incentive compensation paid by Investors Bancorp (including cancellation of outstanding equity awards and reimbursement of any gains realized on such awards) if: (i) the payments or awards were based on reported financial statement or financial information or (any performance metrics or criteria that were based on such financial statements or information); (ii) there is an accounting restatement of financial statements due to material noncompliance with financial reporting requirements under the federal securities laws; and (iii) the amount of the bonus or incentive compensation, as calculated under the restated financial results, is less than the amount actually paid or awarded under the original financial results.

Tax Deductibility of Executive Compensation Under Section 162(m) of the Internal Revenue Code, companies are subject to limits on the deductibility of executive compensation. Deductible compensation is limited to $1 million per year for each Named Executive Officer listed in the summary compensation table, except for the principal financial officer. Compensation that is “qualified performance-based” as defined under Section 162(m) of the Internal Revenue Code is exempt from this limit. Stock option grants are intended to qualify as performance-based compensation.

A number of requirements must be met for particular compensation to qualify for tax deductibility, so there can be no assurance that the incentive compensation awarded will be fully deductible in all circumstances. While the Compensation and Benefits Committee currently does not have a formal policy with respect to the payment of compensation in excess of the deduction limit, the Committee’s practice is to structure compensation programs offered to the Named Executive Officers with a view to maximizing the tax deductibility of amounts paid. However, in structuring compensation programs and making compensation decisions, the Compensation and Benefits Committee considers a variety of factors, including Investors Bancorp’s tax position, the materiality of the payment and tax deductions involved and the need for flexibility to address unforeseen circumstances and Investors Bancorp’s incentive and retention requirement for its management personnel. After considering these factors, the Compensation and Benefits Committee may decide to authorize payments, all or part of which would be nondeductible for federal tax purposes.

Compensation Risk Management The Compensation and Benefits Committee believes that any risks arising from Investors Bancorp’s compensation policies and practices for all of its employees, including the Named Executive Officers, are not PROXY STATEMENT reasonably likely to have a material adverse effect on Investors Bancorp or Investors Bank. In addition, the Compensation and Benefits Committee believes that the mix and design of the elements of the compensation program will encourage senior management to act in a manner that is focused on long-term valuation of Investors Bancorp and Investors Bank.

The Compensation and Benefits Committee regularly reviews Investors Bancorp’s compensation program to ensure that controls are in place so that employees are not presented with opportunities to take unnecessary and excessive risks that could threaten the value of Investors Bancorp or Investors Bank. With respect to the Executive Officer Annual Incentive Plan, the Compensation and Benefits Committee reviews and approves the company-wide performance objectives that determine the bonus payments to be made thereunder. The performance objectives are selected in consultation with an outside independent consultant, and are customary performance metrics for financial institutions in Investors Bancorp’s peer group. Furthermore, all bonus payments are subject to clawback in accordance with our clawback policy, which ensures that performance

49 awards are linked to the actual performance of Investors Bancorp and Investors Bank and promotes the long- term value creation of Investors Bancorp and Investors Bank. Moreover, we instituted our equity retention policy to more closely align the interests of management and the Board with those of our stockholders.

Finally, by implementing the ESOP, the 2006 Equity Plan, the 2015 Equity Plan and by having an executive stock ownership requirement and an equity retention policy, our executive management team and employees have a significant ownership interest in Investors Bancorp, which will align their interests with those of the stockholders, and in turn will contribute to long-term stockholder value and decrease the likelihood that they would take excessive risks that could threaten the value of their Investors Bancorp common stock.

Compensation and Benefits Committee Report Pursuant to rules and regulations of the SEC, this Compensation and Benefits Committee Report shall not be deemed incorporated by reference to any general statement incorporating by reference this Proxy Statement into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except to the extent that Investors Bancorp specifically incorporates this information by reference, and otherwise shall not be deemed “soliciting material” or to be “filed” with the SEC subject to Regulation 14A or 14C of the SEC or subject to the liabilities of Section 18 of the Securities Exchange Act of 1934, as amended.

The Compensation and Benefits Committee (the Committee) of Investors Bancorp has reviewed and discussed the Compensation Discussion and Analysis required by Item 402(b) of Regulation S-K with management and, based on such review and discussions, the Compensation and Benefits Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this Proxy Statement and our Annual Report on Form 10-K.

The Committee understands its fiduciary responsibility to shareholders. The Committee has worked diligently with the assistance of management and our compensation consultant to implement a performance driven compensation program.

RX STATEMENT PROXY We operate in a very competitive banking market. To ensure fairness and competiveness, the Committee collects and analyzes an extensive amount of information about executive compensation values and practices in our marketplace. In our region, obtaining and retaining talented people is a serious challenge. The worldwide financial services industry has a large footprint in the New York and New Jersey area and consequently many opportunities exist for employment. It is important to make Investors Bancorp attractive to this important talent pool.

The Committee believes that our Executive Officer Annual Incentive Plan is competitive and has had a positive effect on employee performance and has properly stimulated and motivated our employees to contribute to the overall success of Investors Bancorp. Each year a participant is assigned personal goals and a share of the overall corporate goals. Each participant is advised of the cash incentive opportunity for meeting his/her goals. Careful selection of goals in a way that aligns the employees’ performance with advancing the overall strategic objectives of Investors Bancorp moves the entire company along its carefully designed strategic path.

The Committee has also utilized equity grants to drive long term performance and to align employees’ financial interests with those of our stockholders. Recent grants have been made with not less than a five- or seven-year vesting requirement, which is much longer than the vesting requirements of our peers and also included performance requirements for the restricted stock awards. Investors Bank also sponsors the ESOP, through which all eligible employees are eligible to receive Investors Bancorp common stock. By ensuring that all employees are shareholders, the Committee believes that the entire workforce has a personal financial stake in the success of Investors Bancorp.

50 Investors Bancorp has adopted a clawback policy, in order to recapture inappropriate incentive compensation payments, should that ever occur. At the same time, the Committee recognizes the need to discourage the taking of undue risk to achieve short term goals. We have built into our overall compensation philosophy elements that encourage longer term thinking and in particular, the preservation of asset quality. It is the Committee’s belief that our compensation program spends company funds in a way that effectively drives superior employee performance and the success of Investors Bancorp.

Compensation and Benefits Committee of Investors Bancorp, Inc. Dennis M. Bone, Chair Robert C. Albanese, Member Doreen R. Byrnes, Member William V. Cosgrove, Member Brian D. Dittenhafer, Member James H. Ward, III, Member

Executive Compensation The following table sets forth for the calendar years ended December 31, 2016, 2015 and 2014 certain information as to the total remuneration earned to Named Executive Officers with respect to the applicable year.

Summary Compensation Table

Change in Pension Value and Non-Equity Nonqualified Stock Option Incentive Plan Deferred Awards Awards Compensation Compensation All Other Name and Principal Position Year Salary ($) Bonus ($) ($) (1) ($) (1) ($) (2) Earnings ($) (3) Compensation ($) (4) Total ($) Kevin Cummings, 2016 1,000,000 — — — 1,820,000 1,982,000 265,911 5,067,911 President and 2015 1,000,000 — 12,540,000 4,159,999 2,076,923 2,411,000 230,035 22,417,957 Chief Executive Officer 2014 1,000,000 — — — 1,500,000 5,058,000 278,700 7,836,700 Domenick A. Cama, 2016 675,000 — — — 982,800 1,091,000 180,396 2,929,196 Senior Executive Vice President 2015 675,000 — 10,032,000 3,327,998 1,121,539 1,200,000 161,720 16,518,257 and Chief Operating Officer 2014 675,000 — — — 810,000 2,799,000 180,794 4,464,794 Richard S. Spengler, 2016 430,000 — — — 468,012 410,000 99,287 1,407,299 Executive Vice President 2015 430,000 — 6,687,996 2,225,599 535,846 295,000 94,231 10,268,672 and Chief Lending Officer 2014 430,000 — — — 381,195 1,049,000 105,118 1,965,313 Paul Kalamaras, 2016 415,000 — — — 460,650 663,000 94,333 1,632,983 Executive Vice President and 2015 415,000 — 6,687,996 2,225,599 516,223 541,000 84,559 10,470,377 Chief Retail Banking Officer 2014 415,000 — — — 371,633 935,000 91,726 1,813,359 Sean Burke, 2016 400,000 — — — 370,000 20,000 44,441 834,441 Senior Vice President and 2015(5) 376,923 — 5,852,004 1,955,198 376,923 — 38,159 8,599,207 PROXY STATEMENT

Chief Financial Officer

(1) The amounts in this column reflect the aggregate grant date fair value computed in accordance with FASB ASC 718, of restricted stock and stock option awards granted pursuant to the 2015 Equity Incentive Plan. The grant date fair value for each option award and stock award was $3.12 and $12.54, respectively. Assumptions used in the calculation of these amounts are included in Note 10 to Investors Bancorp’s audited financial statements for the calendar year ended December 31, 2016 included in Investors Bancorp’s Annual Report on Form 10-K. (2) The amounts were earned pursuant to the Executive Officer Annual Incentive Plan. (3) The amounts in this column reflect the aggregate change in the actuarial present value of the Named Executive Officer's accumulated benefit under all defined benefit and actuarial pension plans (including supplemental plans) from the measurement date in the immediately preceding calendar year to the measurement date in such calendar year, determined using the interest rate and mortality rate assumptions consistent with those used in Investors Bancorp’s financial statements. Effective December 31, 2016 the SERP II was frozen. For Mr. Cummings, Cama and Spengler, the benefit attributable to their 2016 year of service vests over two years. Earnings under the SERP I attributable to the Supplemental ESOP Benefit are not included in this column because the earnings were not “above-market,” as defined by the SEC. For 2014, the change in pension value was substantially higher than 2015 and 2016 primarily as a result of the decrease in the discount rate assumption due to market conditions, as well as the Society of Actuaries’ 2014 issuance of new mortality tables projecting longer life expectancies. In particular, 53% of Mr. Cummings change in pension value in 2014 was due solely to changes in these assumptions.

51 (4) The amounts in this column represent all other compensation not reported in prior columns in this table, including perquisites, the aggregate value of which exceeds $10,000, and employer contributions to defined contribution plans. See the “All Other Compensation” and “Perquisites” tables below for a breakdown of these amounts for the year ended December 31, 2016. (5) Mr. Burke was appointed Senior Vice President and Chief Financial Officer on January 26, 2015. Mr. Burke's full year annualized base salary was $400,000.

Amounts included in the “Stock Awards” and “Option Awards” columns of the Summary Compensation Table represent the grant date fair value of the awards issued to the Named Executive Officers under the 2015 Equity Plan, as determined in accordance with applicable accounting standards. The 2015 Equity Plan was adopted following, and in connection with, the completion of the Company’s Second Step Conversion to stock form. Notwithstanding that (1) stock options and time-based restricted stock awards vest ratably over a seven- year period and the performance-based restricted stock awards are subject to a three-year performance period ending on December 31, 2017; and (2) the annual financial statement expense that we are required to recognize for these grants will be expensed ratably over the vesting period and will be significantly less than the amounts included in the “Stock Awards” and “Option Awards” columns for the year ended December 31, 2015, SEC rules require that we report the full grant date fair value of restricted stock and stock option awards in the year in which the grants are made even though the value cannot be received by the officers in that year. In addition, with respect to the performance-based restricted stock awards, the actual value, if any, realized by the Named Executive Officers will depend on the satisfaction of the performance metrics related to the awards. Moreover, with respect to the stock options, the actual value, if any, realized by any Named Executive Officers will depend on the extent to which the market value of the Investors Bancorp common stock exceeds the exercise price of the stock option on the date of exercise. Accordingly, there is no assurance that the values realized by the Named Executive Officer will be at or near the amounts in the “Stock Awards” and “Option Awards” columns.

All Other Compensation

Company Company Perquisites Contribution Contributions Calendar and Other for Medical to ESOP and or Fiscal Personal and Insurance 401(k) Plan and Name Year Benefits ($)(1) Benefits ($) SERP I ($) Total ($) Kevin Cummings 2016 30,335 26,618 208,958 265,911

RX STATEMENT PROXY Domenick A. Cama 2016 24,959 29,235 126,202 180,396 Richard S. Spengler 2016 8,767 18,560 71,960 99,287 Paul Kalamaras 2016 20,989 3,360 69,984 94,333

Sean Burke 2016 — 26,018 18,423 44,441

(1) A detailed description of the perquisites included in this column is set forth in the table below.

Perquisites

Total Perquisites Calendar Executive and Other or Fiscal Automobile Long Term Club Health Personal Name Year Allowance ($) Care ($) Dues ($) Exam ($) Benefits ($) Kevin Cummings 2016 11,887 8,107 4,646 5,695 30,335 Domenick A. Cama 2016 6,864 11,383 3,642 3,070 24,959 Richard S. Spengler 2016 4,130 2,176 2,461 — 8,767 Paul Kalamaras 2016 7,230 12,262 1,497 — 20,989

Sean Burke 2016 — — — — —

52 Grants of Plan-Based Awards for 2016 The following table sets forth certain information as to grants during calendar 2016 of plan-based awards to the Named Executive Officers under the Executive Officer Annual Incentive Plan.

All Other All Other Option Awards Exercise Stock Number of or Base Grant Date Estimated Payouts Under Non- Awards Securities Price of Fair Value of Equity Incentive Plan Awards (1) Number Underlying Option Stock and Grant Threshold Target Maximum of Shares Options Awards Option Name Date ($) ($) ($) of Units(#) (#) ($/Sh) Awards ($) Kevin Cummings 2/22/2016 1,220,000 1,610,000 2,000,000 — — $ — $ — Domenick A. Cama 2/22/2016 658,800 869,400 1,080,000 — — $ — $ — Richard S. Spengler 2/22/2016 348,300 432,150 516,000 — — $ — $ — Paul Kalamaras 2/22/2016 336,150 417,075 498,000 — — $ — $ —

Sean Burke 2/22/2016 270,000 335,000 400,000 — — $ — $ —

(1) Amounts shown assume achievement of 100% of individual goals and objectives. The range of estimated possible payouts reflects payouts under the Executive Officer Annual Incentive Plan.

For a narrative description of the material factors necessary to an understanding of the information disclosed in the Summary Compensation Table and in the Grants of Plan-Based Awards Table for 2016, please see “Compensation Discussion and Analysis” above.

Outstanding Equity Awards at December 31, 2016 The following table sets forth information with respect to outstanding equity awards as of December 31, 2016 for the Named Executive Officers.

Option Awards Stock Awards Equity Equity Incentive Incentive Plan Plan Awards: Awards: Market or Number of Payout Value Number of Number of Number of Market Unearned of Unearned Securities Securities Shares or Value of Shares, Units, Shares, Units Underlying Underlying Units of Shares or Units or Other or Other Unexercised Unexercised Option Option Stock That of Stock That Rights That Rights That Grant Options (#) Options (#) (1) Exercise Expiration Have Not Have Not Have Not Have Not Name Date Exercisable Unexercisable Price ($) Date (2) Vested (#) (1) Vested ($) (3) Vested (#) (4) Vested ($) (3) Kevin Cummings 6/23/15 190,476 1,142,857 12.54 6/23/25 642,857 8,967,855 250,000 3,487,500 Domenick A. Cama 6/23/15 152,380 914,286 12.54 6/23/25 514,286 7,174,290 200,000 2,790,000 Richard S. Spengler 6/23/15 101,904 611,429 12.54 6/23/25 342,857 4,782,855 133,333 1,859,995 PROXY STATEMENT Paul Kalamaras 6/23/15 101,904 611,429 12.54 6/23/25 342,857 4,782,855 133,333 1,859,995

Sean Burke 6/23/15 89,523 537,143 12.54 6/23/25 300,000 4,185,000 116,667 1,627,505

(1) Stock option and restricted stock awards generally vest over a seven-year period commencing on the first anniversary of the date granted. (2) Stock options generally expire if unexercised 10 years after the grant date. (3) Amounts shown are based on the fair market value of Investors Bancorp common stock on December 31, 2016 of $13.95. (4) Amounts shown represent the number of stock awards that may vest if performance goals are achieved over a three-year period 2015-2017 at Target level.

53 Option Exercises and Stock Vested at December 31, 2016 The following table provides information concerning stock option exercises and the vesting of stock awards for each Named Executive Officer during 2016.

Option Awards Stock Awards Number of Number of Shares Value Shares Value Acquired on Realized on Acquired on Realized on Name Exercise (#) Exercise ($) Vesting (#) Vesting ($) Kevin Cummings(1) 1,147,500 6,524,636 107,143 1,271,787 Domenick A. Cama(1) 1,020,000 5,755,533 85,714 1,017,425 Richard S. Spengler(1) 110,000 645,770 57,143 678,287 Paul Kalamaras 182,000 1,196,230 57,143 678,287

Sean Burke — — 50,000 593,500

(1) Option awards exercised for the period ending December 31, 2016 had an expiration date of November 2016.

Pension Benefits at or for the year ended December 31, 2016 The table below shows the present value of accumulated benefits payable to each of the Named Executive Officers, including the number of years of service credited to each such Named Executive Officer, under our pension plans determined using interest rate and mortality rate assumptions consistent with those used in Investors Bancorp’s financial statements. The Defined Benefit Plan and SERP II were frozen effective as of the close of business on December 31, 2016. For a narrative description of each applicable plan, please see “Compensation Discussion and Analysis” above.

Number of Years Present Value of Credited Accumulated Payment During Name Plan Name Service($) (1) Benefit ($) (2) Last Year ($) Kevin Cummings Defined Benefit Plan 12.5 604,000 — SERP I and SERP II 12.5 15,743,000 —

RX STATEMENT PROXY Domenick A. Cama Defined Benefit Plan 26.0 1,088,000 — SERP I and SERP II 26.0 8,115,000 — Richard S. Spengler Defined Benefit Plan 30.0 868,000 — SERP I and SERP II 30.0 2,425,000 — Paul Kalamaras Defined Benefit Plan 7.3 258,000 — SERP I and SERP II 7.3 2,813,000 — Sean Burke Defined Benefit Plan 0.9 20,000 —

SERP I and SERP II — — —

(1) The number of years of credited service represents all years of service, including years following the change in benefit formula for the Defined Benefit Plan on January 1, 2006. For Messrs. Cama and Spengler, credited service years include qualified years served at other financial institutions that participated in the Defined Benefit Plan, formerly known as the Financial Institutions Retirement Fund. (2) The figures shown are determined as of the plan’s measurement date of December 31, 2016 for purposes of Investors Bancorp’s audited financial statements. For discount rate and other assumptions used for this purpose, please refer to Note 10 to the audited financial statements included in the Annual Report on Form 10-K for the year ended December 31, 2016.

54 Nonqualified Deferred Compensation at or for the year ended December 31, 2016 The following table sets forth information with respect to the Supplemental ESOP portion of SERP I at and for the year ended December 31, 2016 for the Named Executive Officers. For a narrative description of SERP I, please see “Compensation Discussion and Analysis” above.

Executive Registrant Aggregate Aggregate Aggregate Contributions Contributions Earnings in Withdrawals/ Balance at Last Name Plan Name in Last Year ($) in Last Year ($)(1) Last Year ($)(2) Distributions ($) Year-End ($)(3) Kevin Cummings SERP I — 181,113 194,045 — 1,973,782 Domenick A. Cama SERP I — 98,356 95,909 — 984,399 Richard S. Spengler SERP I — 44,113 34,102 — 359,160 Paul Kalamaras SERP I — 42,138 23,063 — 255,204

Sean Burke SERP I — — — — —

(1) The value of the non-qualified Supplemental ESOP contribution made pursuant to SERP I in calendar 2016 is based on the fair market value of Investors Bancorp common stock on December 31, 2016 of $13.95. These contributions are included in the Summary Compensation Table. (2) The aggregate earnings for the Supplemental ESOP and Retirement Plan reflect the change in value of phantom shares issued prior to calendar 2016, based on the fair market value of Investors Bancorp common stock on December 31, 2016 of $13.95. This amount is not included in the Summary Compensation Table because the rate of earnings was not “above-market,” as defined by the SEC. (3) The aggregate balances reported for the Supplemental ESOP Plan are based on the market value of Investors Bancorp common stock on December 31, 2016 of $13.95. For Messrs. Cummings, Cama, Spengler and Kalamaras, $976,054, $486,709, $179,037 and $133,875, respectively, of their total aggregate balance was previously reported as compensation to them in our Summary Compensation Tables for previous years.

Potential Payments Upon Termination or Change in Control At December 31, 2016, Investors Bancorp has entered into employment agreements with Messrs. Cummings, Cama, Spengler, Kalamaras and Burke. A narrative description of the material terms of the agreements is set forth in “Compensation Discussion and Analysis.” The table below reflects the amount of compensation and benefits payable to each Named Executive Officer pursuant to his employment agreement in the event of termination of his employment. No payments are required under the employment agreements due to the Named Executive Officers’ voluntary termination prior to a change in control. The amount of compensation payable to each Named Executive Officer upon: (i) retirement; (ii) early retirement; (iii) involuntary termination (other than for cause); (iv) termination following a change of control; and (v) in the event of disability is shown below. The amounts shown assume that such termination was effective as of December 31, 2016, and thus includes amounts earned through such time and are estimates of the amounts that would be paid to the Named Executive Officer upon termination. The amounts shown relating to unvested stock options and restricted stock awards are based on the fair market value of Investors Bancorp common stock on December 31, 2016 of $13.95 per share. Messrs. Cummings and Cama are entitled to tax indemnification payments for any excess parachute payments under Section 280G of the Internal Revenue Code. With respect to the change in control benefits payable to Messrs. Spengler, Kalamaras and Burke, the amounts shown in the table below do not take into account any reductions that may be required in order to comply with the Internal PROXY STATEMENT Revenue Code Section 280G cut back or net best benefit provision in each of their employment agreements. The actual amounts to be paid out can only be determined at the time of such executive’s date of termination with Investors Bancorp. The following table does not include amounts payable upon termination of employment under SERP I and SERP II that are vested as of December 31, 2016 because the present value of the accumulated vested benefits under each of those plans as of December 31, 2016 is set forth in the tables above.

55

Mr. Mr. Mr. Mr. Mr. Cummings Cama Spengler Kalamaras Burke Retirement (1) Retiree Health/Life Insurance — — — — — Stock Option Vesting — — — — — Restricted Stock Vesting — — — — — Early Retirement (1) Retiree Health/Life Insurance — — — — — Stock Option Vesting — — — — — Restricted Stock Vesting — — — — — Disability Salary Continuation (2) 2,383,542 1,488,542 1,033,542 988,542 663,542 Stock Option Vesting 1,611,428 1,289,143 862,115 862,115 757,372 Restricted Stock Vesting 12,455,355 9,964,290 6,642,851 6,642,851 5,812,505 Other benefits (3) 21,884 20,173 13,063 6,941 17,830 Death Salary Continuation (5) 1,000,000 675,000 430,000 415,000 400,000 Stock Option Vesting 1,611,428 1,289,143 862,115 862,115 757,372 Restricted Stock Vesting 12,455,355 9,964,290 6,642,851 6,642,851 5,812,505 Other benefits (3) 34,185 27,487 22,474 144 34,185 Discharge w/o Cause or Resignation w/ Good Reason-no Change in Control Stock Option Vesting — — — — — Restricted Stock Vesting — — — — — Salary and Cash Incentive (6) 8,460,000 4,973,400 2,694,036 2,626,950 2,310,000 Other benefits (3) 131,302 121,039 83,598 46,865 110,402 Excess Pension Benefit (4)(6) 746,514 365,081 147,100 — — Discharge w/o Cause or Resignation w/ Good Reason-Change in Control-related Stock Option Vesting 1,611,428 1,289,143 862,115 862,115 757,372 Restricted Stock Vesting 12,455,355 9,964,290 6,642,851 6,642,851 5,812,505 Salary and Cash Incentive (6) 8,460,000 4,973,400 2,694,036 2,626,950 2,310,000 Other benefits (3) 131,302 121,039 83,598 46,865 110,402 Excess Pension Benefit (4)(6) 746,514 365,081 147,100 — — (7) Tax Indemnification Payment 9,115,629 6,572,096 — — — RX STATEMENT PROXY (1) As of December 31, 2016, none of the Named Executive Officers were eligible for early retirement or retirement. (2) Upon disability, the Named Executive Officer is entitled to base salary for the longer of the remaining term of his employment agreement or one year. Such benefit is reduced by the amount paid under our disability plan or policy, which is not reflected in this table. (3) Other benefits include amounts for benefits in effect prior to termination; life, medical, dental, disability and long term care, and is calculated based on the terms specified in the employment agreements. (4) Each employment agreement provides that Investors Bancorp will pay the excess, if any of: (i) the present value of benefits to which the Named Executive Officer would be entitled to under the defined benefit plans if he had continued working for Investors Bancorp for 36 months and (ii) the present value of the benefits to which he is actually entitled. (5) This amount is payable according to normal payroll practices for one year following the Named Executive Officer's date of death. (6) This amount is paid in a lump sum following the Named Executive Officer's date of termination. (7) This amount is generally payable in a lump sum to the Named Executive Officer following the date of termination, but it may be timely paid directly to the applicable taxing authorities on behalf of the named executive officer.

Director Compensation Director Fees Each of the individuals who serve as a director of Investors Bancorp also serves as a director of Investors Bank. The non-employee directors of Investors Bancorp and Investors Bank are compensated separately for service on each entity’s board. Each non-employee director of Investors Bancorp is paid a monthly retainer of $2,000 ($4,000 per month for the Chairman), and $2,500 for each committee meeting attended. The Chairman of the Audit Committee, Compensation and Benefits Committee, Nominating and Corporate Governance Committee and Risk Oversight Committee are each paid an annual retainer of $10,000. Each non-employee director of Investors Bank is paid a monthly retainer of $4,000 ($8,000 per month for the Chairman) and $2,100

56 for each Board meeting attended ($4,200 per meeting for the Chairman). Employee directors are not compensated for serving as directors.

The Board of Directors establishes non-employee director compensation based on recommendations of the Compensation and Benefits Committee. Periodically, the Compensation and Benefits Committee engages the services of GK Partners and its external surveys to assist in the committee’s review of director compensation.

Stock Option and Stock Award Program At the annual meeting of stockholders held on June 9, 2015, stockholders of the Company approved the Investors Bancorp, Inc. 2015 Equity Plan, as described above in “Compensation Discussion and Analysis.” Directors are eligible to participate in the 2015 Equity Incentive Plan. Under this plan, individuals may receive awards of Investors Bancorp common stock (restricted stock) and grants of options to purchase shares of Investors Bancorp common stock at a specified exercise price during a specified time period. The Compensation and Benefits Committee engaged GK Partners, an independent compensation consultant to assess the Committee’s recommendations for granting stock options and restricted stock awards to non- employee directors. In determining the amount of restricted stock awards and stock options non-employee directors would receive, the Compensation and Benefits Committee considered the Board’s role in setting the strategic direction for the Company, most notably, their role in completing the mutual to stock public offering in 2014. The Committee also considered the directors’ past contributions, their industry knowledge, their financial expertise and the role they would play in the Company’s future. The Committee also reviewed survey data regarding awards made to directors of other companies that had undertaken a mutual to stock public offering. GK Partners concluded that the Committee’s recommendations for the awards were fair and reasonable and intended to align the economic interest of the directors with that of other shareholders consistent with prevailing director compensation practices in the competitive marketplace for similarly situated public companies.

For the year ended 2016 there were no grants awarded to the directors.

Director Benefits For directors and their spouses or spousal equivalents as of 2007, Investors Bank sponsors a long-term care program. Directors become eligible to participate after one year of service either on the Board of Directors, through past employment or as counsel prior to becoming a director. Each individual policy is owned by the covered person. Investors Bank pays all premiums under the long term care program but will stop paying premiums in the event of the participant’s: (i) resignation from the Board of Directors prior to attaining normal retirement age (except for health reasons); (ii) relocation outside of the country; or (iii) death. Spousal coverage will be terminated upon: (i) a participant’s resignation prior to normal retirement age (except for health reasons); (ii) divorce from the participant; (iii) the participant no longer qualifying for coverage; (iv) the spouse’s permanent relocation outside of the country; or (v) death. Participants who cannot be insured through PROXY STATEMENT an insurance company under the long-term care program will be self-insured by Investors Bank.

Amended and Restated Director Retirement Plan Investors Bank maintains the Amended and Restated Director Retirement Plan. Effective November 21, 2006, the Amended and Restated Director Retirement Plan was frozen such that no new benefits accrued under, and no new directors were eligible to participate in, the plan. A director who: (i) was not an active employee of Investors Bank upon retirement from board service; (ii) has provided at least ten years of “cumulative service” (service on the board and, if applicable, as an employee or counsel); and (iii) retired at age 65 or later or as a result of disability, was eligible to participate in the plan prior to November 21, 2006. Directors Cashill and Dittenhafer are the only directors currently participating in the plan.

57 An eligible director with at least 15 years of cumulative service will be entitled to an annual retirement benefit equal to the sum of 60% of the annual retainer and 13 times the regular board meeting fee in effect for the calendar year preceding the director’s year of retirement. A director with at least 10 years of cumulative service but less than 15 years will be entitled to 40% of the sum of the annual retainer and 13 times the regular meeting fee in effect for the calendar year preceding the director’s year of retirement, plus a pro-rated percentage of 20% of the sum of the annual retainer and 13 times the regular board meeting fee in effect for the calendar year preceding the director’s year of retirement. The plan includes the annual retainer and board fees, if any, paid by Investors Bancorp in determining a director’s retirement benefit.

In the event of a change in control, a director who has not yet attained ten years of service will be deemed to have ten years of service and attained age 65 in order to calculate his benefit under the plan. In the event a director dies prior to retirement, the director’s beneficiary will be entitled to benefit payments in the form of a joint and survivor benefit payable at 100% of the amount paid to the director. Retirement benefits may be paid, at the director’s election, either in monthly payments until the eligible director’s death, or as a joint and survivor form of benefit payable for the lifetime of the eligible director and, upon the eligible director’s death, at 50% of the benefit amount, to the director’s beneficiary, or a joint and survivor form of benefit payable for the lifetime of the director and, upon the director’s death, at 100% of the amount, to the director’s beneficiary during the beneficiary’s lifetime. In order to receive retirement benefits under the plan, the director must remain a director emeritus in good standing after retirement and must not engage in any business enterprise which competes with Investors Bank nor disclose any confidential information relative to the business of Investors Bank.

Deferred Directors Fee Plans Investors Bank maintains the Investors Bank Deferred Directors Fee Plan. Each non-employee member of the Board of Directors of Investors Bank is eligible to participate in the plan and has the right to elect to defer the receipt of all or any part of the director fees earned as a member of the Board of Directors of Investors Bank. Compensation deferred under the plan and interest (at a rate equal to one and one-half percent below the Wall Street Journal prime rate) thereon is payable upon the earlier of the participant’s death, disability or separation from service. Such deferred compensation will be payable in a lump sum, unless the participant has elected payment in monthly installments over a period of up to ten years. At December 31, 2016 there were no participants in the Investors Bank Deferred Directors Fee Plan. RX STATEMENT PROXY Investors Bancorp maintains the Investors Bancorp, Inc. Deferred Directors Fee Plan. Each non-employee member of the Board of Directors of Investors Bancorp is eligible to participate in the plan and has the right to elect to defer the receipt of all or any part of the director fees earned as a member of the Board of Directors of Investors Bancorp. Compensation deferred under the plan and interest (at a rate equal to one and one-half percent below the Wall Street Journal prime rate) thereon is payable upon the earlier of the participant’s death, disability or separation from service. Such deferred compensation will be payable in a lump sum, unless the participant has elected payment in monthly installments over a period of up to ten years. At December 31, 2016 there were no participants in the Investors Bancorp Inc. Deferred Directors Fee Plan.

Split Dollar Life Insurance Agreements Mr. Albanese, Mr. Bone and Ms. Siekerka are each parties to individual split dollar life insurance agreements with Roma Bank, which were assumed by Investors Bank on December 6, 2013 in connection with the merger between Investors Bancorp and Roma Financial Corporation. Investors Bank owns a life insurance policy on the lives of Messrs. Albanese, Bone and Ms. Siekerka. Under the agreement, upon the death of the director, the proceeds of the policy are divided between the director’s beneficiary, who is entitled to $100,000 on the director’s death, and Investors Bank, which is entitled to the remainder of the death benefit. The director has the right to designate the beneficiary who will receive his or her share of the proceeds payable upon death.

58 Summary of Directors’ Compensation The following table sets forth for the year ended December 31, 2016 certain information as to total compensation paid to non-employee directors.

Directors’ Compensation Table

Change in Pension Value and Nonqualified Investors Bancorp Investors Bank Deferred Fees Earned or Fees Earned or Stock Option Compensation All Other Paid in Cash Paid in Cash Awards Awards Earnings Compensation Total Name ($) ($) ($) (1) ($) (2) ($) ($) (3) ($) Robert C. Albanese 74,000 73,200 — — — 413 147,613 Dennis M. Bone 66,500 73,200 — — — 312 140,012 Doreen R. Byrnes 81,500 73,200 — — — 11,234 165,934 Robert M. Cashill 44,000 134,200 — — — 14,306 192,506 William V. Cosgrove 71,500 73,200 — — — 26,674 171,374 Brian D. Dittenhafer 71,500 73,200 — — — 15,200 159,900 Brendan J. Dugan(4) 57,000 67,100 — — — — 124,100 James J. Garibaldi 31,500 73,200 — — — — 104,700 Michele N. Siekerka 54,000 73,200 — — — 281 127,481

James H. Ward III 81,500 73,200 — — — — 154,700

(1) Messrs. Albanese, Bone, Cashill, Cosgrove, Dittenhafer, Garibaldi and Ward and Mses. Byrnes and Siekerka had unvested stock awards of 80,000, 80,000, 100,000, 80,000, 100,000, 80,000, 80,000, 80,000 and 80,000, respectively, at December 31, 2016. All unvested stock awards were granted June 23, 2015 under the 2015 Equity Incentive Plan. (2) Messrs. Albanese, Bone, Cashill, Cosgrove, Dittenhafer, Garibaldi and Ward and Mses. Byrnes and Siekerka each had unexercised stock option awards of 250,000, respectively, at December 31, 2016 which were granted June 23, 2015 under the 2015 Equity Incentive Plan. Mr. Cosgrove had unexercised stock option awards of 100,000 at December 31, 2016 which were received as an employee of Investors Bank under the 2006 Equity Incentive Plan. Mr. Albanese and Ms. Siekerka had unexercised stock option awards of 35,302 and 70,606 options, respectively, at December 31, 2016, which were granted under the Roma Financial Corporation 2008 Equity Incentive Plan. (3) This amount includes perquisites and other personal benefits, or property, if the aggregate amount for each director is at least $10,000. Specifically, this amount represents the premiums paid for long term care coverage for Messrs. Cashill and Dittenhafer and Ms. Byrnes and their spouses. In addition, the amount includes automobile allowance and club dues for Mr. Cosgrove. For Messrs. Albanese and Bone and Ms. Siekerka includes imputed income with respect to their split dollar life insurance agreements. (4) Director Brendan J. Dugan passed away on December 18, 2016. Upon his death, all outstanding stock options and awards vested.

Other Matters PROXY STATEMENT Director Stock Ownership Requirements The Board believes its directors should have a financial investment in Investors Bancorp to further align their interests with stockholders. Directors are expected to own at least 25,000 shares of common stock (excluding stock options). Stock holdings are expected to be achieved within five (5) years of either the implementation of the ownership guidelines or the starting date of the individual, whichever is later.

59 Securities Authorized for Issuance Under Equity Compensation Plans Set forth below is information as of December 31, 2016 regarding equity compensation plans categorized by those plans that have been approved by stockholders and those plans that have not been approved by stockholders.

Number of Number of Securities to Securities be Issued Upon Remaining Exercise of Weighted Available For Outstanding Average Issuance Options and Exercise Under Rights(1) Price(2) Plan Equity compensation plans approved by stockholders 13,998,666 $ 11.74 11,976,522 (3) Equity compensation plans not approved by stockholders — $ — —

Total 13,998,666 $ 11.74 11,976,522

(1) Includes outstanding stock options to purchase 1,107,249 shares of common stock granted under the 2006 Equity Incentive Plan, outstanding stock options to purchase 574,678 shares of common stock granted under the Roma Financial Corporation 2008 Equity Incentive Plan and 833,333 performance-based stock awards granted under the 2015 Equity Incentive Plan. (2) With respect to the stock options, the weighted average exercise price reflects an exercise price of $5.27 for 640,191 stock options granted in 2008; an exercise price of $3.91 for 25,500 stock options granted in 2009; an exercise price of $4.97 for 12,750 stock options granted in 2010; an exercise price of $5.78 for 12,750 stock options granted in 2011; an exercise price of $7.00 for 8,925 stock options granted in 2012; an exercise price of $6.77 for 871,753 stock options granted in 2013; an exercise price of $10.25 for 110,058 stock options granted in 2014; an exercise price of $12.54 for 11,311,966 stock options granted in 2015; an exercise price of $11.60 for 171,440 stock options granted in 2016 under the Company’s stock-based compensation plans. (3) Represents the number of available shares that may be granted as stock options and other stock awards under the Company’s stock- based compensation plans. RX STATEMENT PROXY

60 Proposal II–Advisory Vote to Approve Executive Compensation The Compensation Discussion and Analysis appearing earlier in this Proxy Statement describes the executive compensation program and the compensation decisions made by the Compensation and Benefits Committee with respect to the Chief Executive Officer and other officers named in the Summary Compensation Table (who are referred to as the “Named Executive Officers”).

This proposal, commonly known as a “Say-on-Pay” proposal, gives you as a stockholder the opportunity to vote on our executive pay program. In accordance with Section 14A of the Exchange Act, the Board of Directors is requesting stockholder to cast a non-binding advisory vote on the following resolution: “RESOLVED, that the stockholders of Investors Bancorp, Inc. approve the compensation paid to the Named Executive Officers, as disclosed in this Proxy Statement pursuant to the compensation disclosure rules of the SEC, including the Compensation Discussion and Analysis, the compensation tables and narrative accompanying the tables.”

Our executive compensation program is based on a pay for performance philosophy that is designed to support our business strategy and align the interests of our executives with our stockholders. The Board of Directors believes that the link between compensation and the achievement of our long- and short-term business goals has helped our financial performance over time, while not encouraging excessive risk taking.

For these reasons, the Board of Directors is requesting stockholders to support this proposal. While this advisory vote is non-binding, the Compensation and Benefits Committee and the Board of Directors value the views of the stockholders and will consider the outcome of this vote in future executive compensation decisions.

The Board of Directors recommends a vote “FOR” approval of the compensation paid to Investors Bancorp’s Named Executive Officers. PROXY STATEMENT

61 Proposal III–Ratification of the Appointment of the Independent Registered Public Accounting Firm Investors Bancorp’s independent registered public accounting firm for the year ended December 31, 2016 was KPMG LLP. The Audit Committee has re-appointed KPMG LLP to continue as the independent registered public accounting firm for Investors Bancorp for the year ending December 31, 2017, subject to the ratification by the stockholders at the Annual Meeting. Representatives of KPMG LLP are expected to attend the Annual Meeting. They will be given an opportunity to make a statement if they desire to do so and will be available to respond to appropriate questions.

Stockholder ratification of the appointment of KPMG LLP is not required by Investors Bancorp’s Bylaws or otherwise. However, the Board of Directors is submitting the appointment of the independent registered public accounting firm to the stockholders for ratification as a matter of good corporate practice. If the stockholders fail to ratify the appointment of KPMG LLP, the Audit Committee will reconsider whether it should select another independent registered public accounting firm. Even if the selection is ratified, the Audit Committee in its discretion may direct the appointment of a different independent registered public accounting firm at any time during the year if it determines that such a change is in the best interests of Investors Bancorp and its stockholders.

Audit Fees. The aggregate fees billed to Investors Bancorp for professional services rendered by KPMG LLP for the audit of the Investors Bancorp’s annual financial statements, review of the financial statements included in the Investors Bancorp’s Quarterly Reports on Form 10-Q and services that are normally provided by KPMG LLP in connection with statutory and regulatory filings and engagements were $1,180,000 and $1,260,000 during the years ended December 31, 2016 and 2015, respectively.

Audit Related Fees. The aggregate fees billed to Investors Bancorp for assurance and related services rendered by KPMG LLP that are reasonably related to the performance of the audit of and review of the financial statements and that are not already reported in “Audit Fees,” above, were $130,875 and $104,500 during the years ended December 31, 2016 and 2015, respectively. These services included audits of employee benefit plans, acquisition and transaction related procedures for a subsidiary of the Company.

RX STATEMENT PROXY Tax Fees. The aggregate fees billed to Investors Bancorp for professional services rendered by KPMG LLP for tax compliance, tax advice and tax planning were $159,970 and $118,200 during the years ended December 31, 2016 and 2015, respectively.

All Other Fees. The aggregate fees billed to Investors Bancorp for compliance reviews was $127,000 during the year ended December 31, 2016. There were no “Other Fees” during the years ended December 31, 2015.

The Audit Committee has considered whether the provision of non-audit services is compatible with maintaining the independence of KPMG LLP. The Audit Committee concluded that performing such services does not affect the independence of KPMG LLP in performing its function as Investors Bancorp’s independent registered public accounting firm.

The Audit Committee has delegated to the Chair of the Audit Committee the authority to pre-approve audit and audit-related services between meetings of the Audit Committee, provided the Chair reports any such approvals to the full Audit Committee at its next meeting. The full Audit Committee pre-approves all other services to be performed by the independent registered public accounting firm and the related fees.

The Board of Directors recommends a vote “FOR” the ratification of KPMG LLP as the independent registered public accounting firm.

62 Other Matters As of the date of this document, the Board of Directors knows of no matters that will be presented for consideration at the Annual Meeting other than as described in this document. However, if any other matter shall properly come before the Annual Meeting or any adjournment or postponement thereof and shall be voted upon, the proposed proxy will be deemed to confer authority to the individuals named as authorized therein to vote the shares represented by the proxy in accordance with their best judgment as to any matters that fall within the purposes set forth in the notice of Annual Meeting.

Stockholder Proposals To be eligible for inclusion in the proxy materials for next year’s annual meeting of stockholders under SEC Rule 14(a)-8, any stockholder proposal to take action at such meeting must be received at Investors Bancorp’s executive office, 101 JFK Parkway, Short Hills, New Jersey 07078, no later than December 14, 2017. Any such proposals shall be subject to the requirements of the proxy rules adopted under the Securities Exchange Act of 1934, as amended.

Advance Notice of Business to be Conducted at an Annual Meeting The Bylaws of Investors Bancorp also provide an advance notice procedure for certain business, or nominations to the Board of Directors, to be brought before an annual meeting of stockholders. In order for a stockholder to properly bring business before an annual meeting, the stockholder must give written notice to the Corporate Secretary of Investors Bancorp not less than 90 days prior to the date of Investors Bancorp’s proxy materials for the preceding year’s annual meeting; provided, however, that if the date of the annual meeting is advanced more than 30 days prior to or delayed by more than 30 days after the anniversary of the preceding year’s annual meeting, notice by the stockholder to be timely must be so delivered not later than the close of business on the tenth day following the day on which public announcement of the date of such annual meeting is first made. The notice must include the stockholder’s name, record address, and number of shares owned, describe briefly the proposed business, the reasons for bringing the business before the annual meeting, and any material interest of the stockholder in the proposed business. Nothing in this paragraph shall be deemed to require Investors Bancorp to include in its proxy statement and proxy relating to an annual meeting any stockholder proposal under SEC Rule 14a-8. In accordance with the foregoing, in order for a proposal or a nomination to be brought before the annual meeting of stockholders to be held following the year ending December 31, 2017, notice must be provided to the Corporate Secretary by January 12, 2018.

The following documents are available on the “Governance Documents” section of the “Investor Relations” page of the Investors Bank’s website at www.myinvestorsbank.com:  Audit Committee Charter

 Compensation and Benefits Committee Charter PROXY STATEMENT  Nominating and Corporate Governance Charter  Investors Bancorp’s Corporate Governance Guidelines  Investors Bancorp’s Code of Business Conduct and Ethics  Investors Bancorp’s Independence Standards

Copies of each will be furnished without charge upon written request to the Corporate Secretary, Investors Bancorp, Inc., 101 JFK Parkway, Short Hills, New Jersey 07078.

An additional copy of Investors Bancorp’s Annual Report on Form 10-K (without exhibits) for the year ended December 31, 2016, as filed with the Securities and Exchange Commission, will be furnished without charge to stockholders upon written request to the Corporate Secretary, Investors Bancorp, Inc., 101 JFK Parkway, Short Hills, New Jersey 07078. The Form 10-K is also available free of charge on the “Investor Relations” page of the Investors Bank’s website at www.myinvestorsbank.com.

63 CORPORATE INFORMATION

BOARD OF DIRECTORS Robert M. Cashill Kevin Cummings James J. Garibaldi Chairman of the Board President & Chief Executive Officer Michele N. Siekerka Robert C. Albanese Peter H. Carlin James H. Ward, III Dennis M. Bone William V. Cosgrove Paul N. Stathoulopoulos* Doreen R. Byrnes Brian D. Dittenhafer Domenick Cama Senior Executive Vice President & Chief Operating Officer

EXECUTIVE OFFICERS Kevin Cummings Richard Spengler Sean Burke President & Executive Vice President & Senior Vice President & Chief Executive Officer Chief Lending Officer Chief Financial Officer Domenick Cama Paul Kalamaras Senior Executive Vice President Executive Vice President & & Chief Operating Officer Chief Retail Banking Officer

INDEPENDENT AUDITORS CORPORATE COUNSEL KPMG, LLP Luse Gorman, PC 51 JFK Parkway 5335 Wisconsin Ave., NW Short Hills, NJ 07078 Suite 780 Washington, DC 20015 TRANSFER AGENT & REGISTRAR Inquiries regarding stock certificate INVESTOR RELATIONS administration, address changes and other Stockholders, Investors, and related services should be directed to: Analysts may also contact: Computershare Marianne Wade P O Box 30170 Vice President College Station, TX 973.924.5100 77842-3170 [email protected] 800.851.9677

CORPORATE OFFICE 101 JFK Parkway Short Hills, NJ 07078 973.924.5100 www.investorsbank.com

*Member of the Investors Bank Board of Directors ANNUAL REPORT • FORM 10-K & PROXY STATEMENT

2016 investorsBancorp, INC. 101 JFK PARKWAY • SHORT HILLS, NJ • 07078

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