Pooling, Aggregation and Integration: Strategies for Small Issuers to Increase Their Volume Presented by: Steven Brookner NCB, FSB May 22, 2006 New York

National Cooperative Bank, NCBDC & NCB, FSB – Mission Activities  Community Development Loans - $230,556,094 Affordable Housing - $92,753,015 Community Healthcare - $36,106,372 Commercial Real Estate - $28,200,000 Education/Charter Schools - $23,374,961 Alaska/Native Tribes - $21,875,761 Small Business - $13,732,027 ESOPs - $11,383,958 Community-Based Organizations - $3,130,000  Arranged Transactions - $115,027,783  SF Low/Moderate Mortgage Loans - $54,647,000  Other - $19,460,427  TOTAL - $419,691,304

Current Strategy  Judicious Use of Balance Sheet Challenges Include:  Overall Capacity  Nationwide Presence  Managing Risk Profile  Managing Diverse Portfolio of Community Development Loans  Regulatory Environment at NCB, FSB Successes Include:  Growing Capacity  Superior Risk-Adjusted Returns Exceeding Some Market Rate Lending

Current Strategy - Continued  CMBS & Agency Delivery – Over $150 Million in 2005 Challenges Include:  Seeding Pools with Appropriate Levels of Community Development Loans  Educating Investors, Rating Agencies and Others Successes Include:  Standardized Underwriting and Documentation  Superior Execution Resulting in Lower Pricing to Borrowers  Leveraging NCB’s Securitization Experience and Origination Reputation  Maintaining Servicing of Loans – Master, Primary and Special

Current Strategy - Continued  Arranged Transactions New Markets Tax Credits Enhancement Fund – Charter Schools CCAP – Charter Schools Healthy California – Health Clinics  Challenges Include:  Narrowly Defined  Geographic Constraints  The Investor Market is Not Particularly Deep  Success Include:  Strong Loan Performance  Leveraging Other People’s Money  Lower Cost of Funds  Slicing of the Capital Structure to Create Enhancement

Looking Ahead – Items Necessary to Take Aggregation to the Next Level  Homogeneity Loans Require Common Structures – Some Differentiation is Acceptable  Prepayment, Fixed/Floating, Asset Class, Amortization, Term, Insurance Requirements, etc. Standardization of Documentation to Meet Secondary Market Requirements  Common Servicing Platform/Capabilities Primary Servicing Master Servicing Investor Reporting Capability  Special Servicing Capability  Partnering  Representations and Warranties  Performance History

FUND & CDO Structure CDFIs CBOs Banks Etc. Originator & Seller CDO CDF Collateral Mgr Trustee Hedge Counterparty Investment Grade Investors CDF FUND Equity Investor AAA AA A BBB BB B Preferred Share Assets Proceeds CDO Securities P & I Loans Sold Loan Proceeds CDF FUND Warehouse Aggregator Securitizer CDF Servicer Rated

Advantages of Structure  Cost of Funds Attractive Warehouse Advance Rates CDO Effective Rate – Superior to Other Structures Resulting Lower Cost to Borrowers  Flexibility Ability to Mix Community Development Loans Ramp Up CDO^2 Unregulated Environment  Maximized Leverage Created by Foundation, Investment Firm, and Socially Responsible Investors’ Monies