Can small still be beautiful, and profitable, in banking today? Like in so many other areas, consolidations have become the norm in banking in this country, leading to a few mega-mega banks.
In such a world, independents such as Astoria Federal have become the exception. Whether they will succeed and survive in the longer term is an open question.
Here's some looks at the question of scale in banking, including a Time magazine article about North Fork a few years before it too was gobbled up:
http://www.allbusiness.com/personal-finance/851204-1.html
http://www.dallasfed.org/research/swe/2004/swe0401b.html
http://www.time.com/time/magazine/article/0,9171,536217,00.html
--Noel Rubinton