TRANSACTION WILL INCREASE CET1 CAPITAL RATIO
TO 10.8% ON A PROFORMA BASIS AND FURTHER BOLSTER
LIQUIDITY
LOAN-TO-DEPOSIT RATIO IMPROVES TO 104%
HICKSVILLE, N.Y., May 14, 2024
/PRNewswire/ -- New York Community Bancorp, Inc. (NYSE: NYCB)
(the "Company"), the parent company of Flagstar Bank, N.A. (the
"Bank") announced today that it has agreed to sell approximately
$5 billion in mortgage warehouse
loans to JPMorgan Chase Bank, N.A. ("JPMC").
Upon closing, the Company expects that the transaction will add
65 basis points to the CET1 capital ratio, as converted for the
preferred, resulting in a pro-forma CET1 capital ratio of 10.8% as
of March 31, 2024. It will also
bolster our liquidity profile as the proceeds of the sale will be
reinvested into cash and securities. On a pro-forma basis,
the ratio of cash and securities to total assets is projected to
improve to 24% from 20% at March 31,
2024. Similarly, the Bank's pro-forma loan-to-deposit ratio
is expected to decline to 104% compared to 110% at the end of the
first quarter of 2024.
Commenting on the sale, President and Chief Executive Officer
Joseph Otting stated, "Consistent
with my guidance during our recent earnings call, we are moving
forward quickly to implement our strategic plan, which focuses on
improving our capital, liquidity and loan-to-deposit metrics. The
mortgage team at Flagstar built a first-class warehouse business,
which is reflected in our ability to execute on an accretive
transaction with JP Morgan. The mortgage business remains an
important business for the Company and we will continue to provide
our mortgage customers and partners the same great service that
they have come to expect from Flagstar."
The Bank has entered into a commitment letter with JPMC
regarding the proposed transaction. Completion of the
transaction remains subject to completion of due diligence,
negotiation of definitive documentation, and satisfaction of
customary closing conditions. The sale is expected to close
in the third quarter of 2024.
About New York Community Bancorp, Inc.
New York Community Bancorp, Inc. is the parent company of
Flagstar Bank, N.A., one of the largest regional banks in the
country. The Company is headquartered in Hicksville, New York. At March 31, 2024, the Company had $112.9 billion of assets, $83.3 billion of loans, deposits of $74.9 billion, and total stockholders' equity of
$8.4 billion.
Flagstar Bank, N.A. operates 419 branches, including strong
footholds in the Northeast and Midwest and exposure to high-growth
markets in the Southeast and West Coast. Flagstar Mortgage operates
nationally through a wholesale network of approximately 3,000
third-party mortgage originators. In addition, the Bank has
approximately 100 private banking teams located in over ten cities
in the metropolitan New York City
region and on the West Coast, which serve the needs of high-net
worth individuals and their businesses.
New York Community Bancorp, Inc. has market-leading positions in
several national businesses, including multi-family lending,
mortgage origination and servicing, and warehouse lending.
Flagstar Mortgage is the seventh largest bank originator of
residential mortgages for the 12-months ending March 31, 2024, and the industry's fifth largest
sub-servicer of residential mortgage loans nationwide, servicing
1.4 million accounts with $367 billion in unpaid
principal balances.
Cautionary Note Regarding Forward-Looking Statements
The foregoing disclosures may include forward‐looking statements
within the meaning of the federal securities laws by the Company
pertaining to such matters as our goals, intentions, and
expectations regarding (a) revenues, earnings, loan production,
asset quality, liquidity position, capital levels, risk analysis,
divestitures, acquisitions, and other material transactions, among
other matters; (b) the ability of the Bank to complete the proposed
transaction in a timely manner, or at all; (c) the future costs and
benefits of the actions we may take; (d) our assessments of credit
risk and probable losses on loans and associated allowances and
reserves; (e) our assessments of interest rate and other market
risks; (f) our ability to execute on our strategic plan, including
the sufficiency of our internal resources, procedures and systems;
(g) our ability to attract and retain key personnel; (h) our
ability to achieve our financial and other strategic goals,
including those related to our merger with Flagstar Bancorp, Inc.,
which was completed on December 1, 2022, our acquisition of
substantial portions of the former Signature Bank through an
FDIC-assisted transaction, and our ability to fully and timely
implement the risk management programs institutions greater than
$100 billion is assets must maintain; (i) matters to be presented
to, voted on and approved by the Company's stockholders; (j) the
conversion or exchange of shares of the Company's preferred stock;
and (k) the payment of dividends on shares of the Company's capital
stock, including adjustments to the amount of dividends payable on
shares of the Company's Series B preferred stock.
Forward‐looking statements are typically identified by such
words as "believe," "expect," "anticipate," "intend," "outlook,"
"estimate," "forecast," "project," "should," and other similar
words and expressions, and are subject to numerous assumptions,
risks, and uncertainties, which change over time. Additionally,
forward‐looking statements speak only as of the date they are made;
the Company does not assume any duty, and does not undertake, to
update our forward‐looking statements. Furthermore, because
forward‐looking statements are subject to assumptions and
uncertainties, actual results or future events could differ,
possibly materially, from those anticipated in our statements, and
our future performance could differ materially from our historical
results.
Our forward‐looking statements are subject to, among others, the
following principal risks and uncertainties: general economic
conditions and trends, either nationally or locally; conditions in
the securities, credit and financial markets; changes in interest
rates; the inability of the Bank and JPMC to execute the
definitive documentation contemplated by the commitment letter or
satisfy customary closing conditions; changes in deposit
flows, and in the demand for deposit, loan, and investment products
and other financial services; changes in real estate values;
changes in the quality or composition of our loan or investment
portfolios, including associated allowances and reserves; changes
in future allowance for credit losses requirements under relevant
accounting and regulatory requirements; the ability to pay future
dividends; changes in our capital management and balance sheet
strategies and our ability to successfully implement such
strategies; changes in our strategic plan, including changes in our
internal resources, procedures and systems, and our ability to
successfully implement such plan; changes in competitive pressures
among financial institutions or from non‐financial institutions;
changes in legislation, regulations, and policies; the success of
our blockchain and fintech activities, investments and strategic
partnerships; the restructuring of our mortgage business; the
impact of failures or disruptions in or breaches of the Company's
operational or security systems, data or infrastructure, or those
of third parties, including as a result of cyberattacks or
campaigns; the impact of natural disasters, extreme weather events,
military conflict (including the Russia/Ukraine conflict, the conflict in Israel and surrounding areas, the possible
expansion of such conflicts and potential geopolitical
consequences), terrorism or other geopolitical events; and a
variety of other matters which, by their nature, are subject to
significant uncertainties and/or are beyond our control. Our
forward-looking statements are also subject to the following
principal risks and uncertainties with respect to our merger with
Flagstar Bancorp, which was completed on December 1, 2022, and our acquisition of
substantial portions of the former Signature Bank through an
FDIC-assisted transaction: the possibility that the anticipated
benefits of the transactions will not be realized when expected or
at all; the possibility of increased legal and compliance costs,
including with respect to any litigation or regulatory actions
related to the business practices of acquired companies or the
combined business; diversion of management's attention from ongoing
business operations and opportunities; the possibility that the
Company may be unable to achieve expected synergies and operating
efficiencies in or as a result of the transactions within the
expected timeframes or at all; and revenues following the
transactions may be lower than expected. Additionally, there can be
no assurance that the Community Benefits Agreement entered into
with NCRC, which was contingent upon the closing of the Company's
merger with Flagstar Bancorp, Inc., will achieve the results or
outcome originally expected or anticipated by us as a result of
changes to our business strategy, performance of the U.S. economy,
or changes to the laws and regulations affecting us, our customers,
communities we serve, and the U.S. economy (including, but not
limited to, tax laws and regulations).
More information regarding some of these factors is provided in
the Risk Factors section of our Annual Report on Form 10‐K/A for
the year ended December 31, 2023,
Quarterly Report on Form 10-Q for the quarter ended March 31, 2024, and in other SEC reports we file.
Our forward‐looking statements may also be subject to other risks
and uncertainties, including those we may discuss in this
Amendment, during investor presentations, or in our other SEC
filings, which are accessible on our website and at the SEC's
website, www.sec.gov.
Investor Contact:
Salvatore J. DiMartino
(516) 683-4286
Media Contact:
Steven
Bodakowski
(248) 312-5872
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SOURCE New York Community Bancorp, Inc.