Fitch Affirms New York Community Bancorp, Inc. at 'BBB+'; Outlook Remains Stable

  Fitch Affirms New York Community Bancorp, Inc. at 'BBB+'; Outlook Remains
  Stable

Business Wire

NEW YORK -- March 8, 2013

Fitch Ratings today affirmed the long-term and short-term Issuer Default
Ratings (IDRs) of New York Community Bank at 'BBB+/F2'. The Rating Outlook
remains Stable. A full list of rating actions follows at the end of this press
release.

RATING ACTION RATIONALE

Today's rating affirmation reflects NYCB's strong track record implementing
its focused multifamily lending strategy in the New York City area as well as
its solid earnings and asset quality. These strengths are balanced against
NYCB's relatively higher risk funding profile and modest franchise.

KEY RATING DRIVERS - IDRs, VRs and Preferred Stock

Loss history continues to be a rating strength for the institution. Through
the credit cycle, NCOs peaked at 34bps and totaled just 13bps in 2012. Low
losses are attributable to NYCB's ability to execute its core strategy of
rent-regulated, multi-family lending predominantly in NYCB's core market in
New York City. However, NPAs for the institution remain elevated compared to
pre-crisis levels at 2.36. Fitch expects the level of NPAs to continue to
decline while NCOs remain low.

Earnings performance is solid. NYCB's ROA of 1.18% compares favorably with
similarly rated institutions. NYCB's profitability is a function of low credit
costs, low overhead expenses and a balance sheet which has a greater
percentage loans than most banks. Fitch expects NYCB's profitability to face
headwinds in 2013 as the low rate environment and increasing competition for
multi-family loans pressures net interest margin. Additionally, mortgage
banking could also see some contraction as many borrowers no longer have
economic incentive to refinance their home mortgages.

NYCB's limited franchise remains ratings weakness for the institution. NYCB is
reliant on wholesale funding as the institution continues to try to grow its
core deposit base. With a loan to deposit ratio of 128%, it remains an outlier
relative to similarly rated peers. Further, NYCB's commercial loan origination
platform is largely originated via brokerage channels, which leaves limited
opportunity to cross sell products and diversify income. NYCB's acquired
mortgage banking platform has introduced some diversity into the company's
revenue mix. However, mortgage banking tends to be volatile, and Fitch
considers the quality of this income weaker than that of the core multifamily
business.

RATING SENSITIVITIES - IDRs, VRs and Preferred Stock

NYCB's ratings are highly sensitive to the multifamily market in the New York
City area. Loosening of rent-regulations in the New York area could be a
negative rating driver for the institution. Additionally, aggressive capital
management or any deterioration of asset quality metrics could also result in
negative ratings pressure.

NYCB continues to eye potential large accretive acquisitions. Such a
transaction will be viewed by Fitch with caution. Although NYCB has
demonstrated the ability to integrate many institutions in the past, large
acquisitions will require commensurate enhancements to risk management and
will likely make NYCB a systemically important financial institution under
Dodd-Frank.

Conversely, NYCB has very limited ability to achieve ratings improvement given
its concentration to asset classes, geographies and single name borrowers.
Further, NYCB's limited franchise and funding profile also make positive
ratings action unlikely in the near term.

KEY RATING DRIVERS - Support and Support Rating Floors

NYCB has a Support Ratings of '5' and Support Rating Floors of 'NF'. Fitch
believes that they are not systemically important and therefore, the
probability of support is unlikely. The IDRs and VRs do not incorporate any
external support.

RATING SENSITIVITIES - Support and Support Rating Floors

Fitch does not anticipate changes to NYCB's Support Ratings or Support Rating
Floors given size and the lack of systemic importance of the institution.

Fitch has affirmed the following ratings:

New York Community Bancorp

--Long-term IDR at 'BBB+';

--Viability rating at 'bbb+';

--Short-term IDR at 'F2';

--Support at '5';

--Support floor at 'NF'.

New York Community Bank

--Long-term IDR at 'BBB+';

--Long-term deposits at 'A-';

--Viability rating at 'bbb+';

--Short-term IDR at 'F2';

--Support at '5';

--Support floor at 'NF';

--Short-term deposits at 'F2'.

New York Commercial Bank

--Long-term IDR at 'BBB+';

--Long-term deposits at 'A-';

--Viability rating at 'bbb+'.

--Short-term IDR at 'F2';

--Support at '5';

--Support floor at 'NF';

--Short-Term deposits at 'F2'.

Richmond County Capital Corporation

--Preferred stock at 'BB-'.

Additional information is available at 'www.fitchratings.com'. The ratings
above were solicited by, or on behalf of, the issuer, and therefore, Fitch has
been compensated for the provision of the ratings.

In addition to the source(s) of information identified in Fitch's Master
Criteria, these actions were additionally informed by information provided by
the companies.

Applicable Criteria and Related Research:

--'Risk Radar' (Jan. 16, 2013);

--'Global Financial Institutions Rating Criteria' (Aug. 15, 2012);

--'Rating FI Subsidiaries and Holding Companies' (Aug. 10, 2012);

--'U.S. Banking Quarterly Comment: 4Q12' (Feb. 21, 2013).

Applicable Criteria and Related Research

Risk Radar Update

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=699014

Global Financial Institutions Rating Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=686181

Rating FI Subsidiaries and Holding Companies

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=679209

U.S. Banking Quarterly Comment: 4Q12

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=701972

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Contact:

Fitch Ratings
Primary Analyst
Jaymin Berg, CPA
Director
+1-212-908-0368
Fitch Ratings, Inc.
One State Street Plaza
New York, NY 10004
or
Secondary Analyst
Doriana Gamboa
Director
+1-212-908-0865
or
Committee Chairperson
Christopher Wolfe
Managing Director
+1-212-908-0771
or
Media Relations
Brian Bertsch
+1-212-908-0549
brian.bertsch@fitchratings.com
 
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