HICKSVILLE, N.Y. - New York Community Bancorp , Inc. (NYSE: NYSE:NYCB), the parent company of Flagstar Bank, N.A., announced on Thursday that its Board of Directors has approved a one-for-three reverse stock split. This decision follows the authorization by the company's shareholders at the annual meeting on June 5, 2024. The reverse stock split is expected to be implemented in mid-to-late July.
The company, headquartered in Hicksville, New York, reported assets of $112.9 billion and loans totaling $83.3 billion as of March 31, 2024. With deposits amounting to $74.9 billion and total stockholders' equity of $8.4 billion, New York Community Bancorp maintains a significant presence in the banking industry. It operates 419 branches through Flagstar Bank and has a substantial mortgage business that ranks seventh in bank-originated residential mortgages and fifth in sub-servicing of residential mortgage loans nationwide.
The reverse stock split is part of the company's strategic initiatives following its merger with Flagstar Bancorp (NYSE:FBC), Inc. on December 1, 2022, and the acquisition of substantial parts of the former Signature Bank (OTC:SBNY) in an FDIC-assisted transaction. The company has emphasized its commitment to achieving financial and strategic goals, including the implementation of risk management programs required for institutions with assets over $100 billion.
Forward-looking statements in the press release indicate the company's intentions and expectations regarding various financial aspects and strategic plans. However, these statements are subject to a range of assumptions, risks, and uncertainties that could affect actual outcomes.
The press release also acknowledges the potential risks and uncertainties related to general economic conditions, market trends, competitive pressures, and regulatory changes. The company has outlined that forward-looking statements are not guarantees of future performance and that actual results could differ materially from historical results.
This news is based on a press release statement from New York Community Bancorp, Inc.
In other recent news, New York Community Bancorp (NYCB) has completed the acquisition of assets from the defunct Signature Bank worth an estimated $37.8 billion. This includes $24.9 billion in cash and cash equivalents, as well as $11.7 billion in loans and leases. Simultaneously, NYCB has assumed liabilities estimated at $35.7 billion in fair value, primarily composed of $33.5 billion in customer deposits.
Furthermore, Liberty Strategic Capital, led by former U.S. Treasury Secretary Steven Mnuchin, disclosed a 7.7% ownership in NYCB. This stake was revealed following Liberty Strategic Capital's participation in an investor consortium that injected approximately $1 billion into NYCB earlier this year.
The U.S. Securities and Exchange Commission (SEC) has also requested NYCB to provide additional information regarding its recent capital-raising activities and its efforts to decrease its commercial real estate sector exposure. This request followed NYCB's capital raise of $1.05 billion from investors, including Steven Mnuchin.
In addition, shareholders of NYCB have passed several significant measures at the Annual Shareholders Meeting, including the election of directors and the ratification of the company's independent auditor. They also endorsed the issuance of shares of common stock in connection with the March 2024 capital raise.
Lastly, NYCB has appointed Joseph Otting as the executive chairman, adding to his current role as President and CEO. This follows the bank's strategy to improve liquidity and return to profitability, which includes selling approximately $5 billion in mortgage warehouse loans to JPMorgan Chase (NYSE:JPM).
InvestingPro Insights
In the wake of New York Community Bancorp's recent announcement regarding a reverse stock split, investors are closely monitoring the company's financial health and market position. According to real-time data from InvestingPro, NYCB has a market capitalization of approximately $3.22 billion. The company's Price / Book ratio stands at a notably low 0.41 as of the last twelve months leading into Q1 2024, indicating that the stock may be undervalued relative to its book value. This is reinforced by an "InvestingPro Tip" highlighting that NYCB is trading at a low Price / Book multiple, which could attract value-focused investors.
Despite a substantial year-over-year revenue growth of 85.66% in the last twelve months as of Q1 2024, analysts are expecting a sales decline in the current year, as noted in another "InvestingPro Tip". Additionally, the company's stock has experienced significant price volatility with a 6-month price total return plummeting by 69.65%, and a 1-year price total return down by 71.0%, reflecting a period of considerable market pressure for NYCB.
New York Community Bancorp has also maintained its dividend payments for an impressive 31 consecutive years, a testament to its long-term commitment to shareholder returns. However, investors should be aware of the anticipated net income drop this year and the analysts' forecast that the company may not be profitable within the same timeframe. These factors, along with the company's recent strategic initiatives, are critical considerations for stakeholders and potential investors.
For those looking to delve deeper into NYCB's financials and forecasts, InvestingPro offers additional insights and analytics. There are 11 more "InvestingPro Tips" available, which could provide further clarity on the company's performance and prospects. Interested readers can take advantage of a special offer using the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, unlocking a wealth of investment analysis and data.
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