NY Community Bancorp Plunges as Real Estate Risks Jolt Market
- Loan-loss provision soars on sign of weakening credit quality
- Bank is also bolstering balance sheet for stiffer regulation
WATCH; Citizens Financial CEO Calls NYCB ‘An Outlier’
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New York Community Bancorp, one of the winners as regional lenders struggled and collapsed last year, plunged by a record as investors worried it’s now the harbinger of the industry’s next source of pain: commercial real estate.
The firm, which acquired part of Signature Bank last year, stockpiled cash as it contends with lending risks — including a pair of troubled loans for a co-op complex and office space — as well as stiffer regulation due to its size. The bank’s provision for loan losses surged to $552 million, shocking analysts and shareholders.