New York Community Bancorp sells $7.5 billion in assets

Executives of New York Community Bancorp Inc. said Thursday the Hicksville-based lender has strengthened its finances by selling assets and winning new deposits — each valued in the billions of dollars — after nearly going under five months ago.

Joseph M. Otting, the former U.S. comptroller of the currency hired in March to turn around NYCB, said it had raised $7.5 billion by selling a portfolio of mortgages on warehouses and a mortgage-servicing operation this week.

Banking behemoth JPMorgan Chase paid $6.1 billion for the warehouse loans and mortgage provider Mr. Cooper paid $1.4 billion for the mortgage servicing operation, Otting said in announcing NYCB’s earnings for the April-June period.

NYCB reported a loss of $323 million for the period compared with a profit of $413 million in April-June 2023. The latter was boosted by NYCB’s purchase of Michigan-based Flagstar Bank and some of the assets of Signature Bank after it was taken over by federal regulators.

NYCB’s loss totaled $327 million in the January-March period.

On Wall Street, investors responded to Thursday’s earnings report by sending NYCB’s stock lower. The bank’s shares were down 71 cents, or more than 6%, to $10.23 at 11 a.m. on the New York Stock Exchange.

“I am confident that the actions we are taking will be instrumental in transforming [NYCB] into a well-diversified regional bank with a strong balance sheet, robust capital and meaningful earnings power,” said Otting, the bank’s CEO, president and board chairman.

NYCB received $4.2 billion in new deposits in the April-June period, an increase of nearly 6% from the January-March period.

The bank’s branches now use the Flagstar Bank name after the Roslyn Savings Bank, Queens County Savings Bank, New York Community Bank and other brand names were retired in February.

NYCB’s woes began in February when its stock price tanked — going from $10 per share to under $3 — on news of a $2.4 billion charge against its 2023 earnings because of troubled loans for rent-regulated apartments and office buildings. The unexpected charge turning the projected profit into a loss.

At the time, NYCB was being compared with Silicon Valley Bank and Signature, both of which failed last year.