• Contact Us
  • Privacy Policy
  • Terms Of Service
  • Unsubscribe
  • Privacy Choices
Credit Ideas & Credit Management
  • Home
  • Finance
  • Insurance
  • Loans
  • Mortgage
  • Shares
No Result
View All Result
  • Home
  • Finance
  • Insurance
  • Loans
  • Mortgage
  • Shares
No Result
View All Result
New Credit Ideas
No Result
View All Result

Regional bank hit with 3rd credit downgrade as crisis concerns linger

admin by admin
February 10, 2024
Home Loans

New York Community Bank (NYCB) was hit with its third credit downgrade as fears linger that the regional bank could be in peril nearly a year after the regional banking sector was hit by a crisis that triggered some of the largest bank failures in U.S. history.

Morningstar DBRS on Thursday downgraded NYCB’s credit rating and cited “outsized” exposure to commercial real estate (CRE) that the bank has pledged to reduce in the months ahead. CRE borrowers have been under pressure due to the higher interest rate environment as well as lower occupancy rates due to the rise of remote work.

The downgrade comes after rating agencies Fitch and Moody’s also lowered NYCB’s ratings in the last week. Last Friday, Fitch cut NYCB’s rating from BBB to BBB-, its lowest investment grade rating, while Moody’s lowered NYCB’s rating to Ba2, a non-investment grade or “junk” tier, on Wednesday.

“Liquidity appears sufficient, but given the bank failures last spring, we remain cautious given that the adverse headline risk, including a significant decline in NYCB’s stock price, could eventually spook customer and depositor confidence,” Morningstar DBRS said of its downgrade.

Investors’ concerns about NYCB came to a head last week after the company posted a surprise loss and announced a dividend cut to boost reserves required by banking regulations, along with its exposure to the CRE market. Those worries sent the bank’s stock plunging to its lowest level since 2000.

NYCB’s management has tried to bolster investor confidence as the company’s stock has fallen over 59% in the last month, including a more than 6% decline during Thursday’s trading. Newly-appointed executive chairman Alessandro DiNello said Wednesday that NYCB will consider the sale of loans in its commercial real estate portfolio or let them run off the balance sheet naturally.

The lender also indicated that if necessary, it would consider shrinking its balance sheet by selling non-core assets to shore up its common equity tier 1 ratio, a key measure of financial strength.

Treasury Secretary Janet Yellen said during a hearing Thursday that she expects additional stress and some financial losses due to weakness in the CRE market, but that banking regulators are working with banks to address those risks.

NYCB set aside more capital to meet regulatory requirements for capital and liquidity that came into effect after the bank surpassed the $100 billion in total assets threshold.

NYCB was founded in 1859 and has long served as a small regional bank. Between 2000 and 2023, it completed 13 acquisitions to grow to its current size.

Among those acquisitions was Signature Bank, which failed during last year’s regional banking crisis. It also recently acquired Flagstar Bank, which allowed it to expand its footprint around the country.

Last year’s regional banking crisis saw some of the largest bank failures in U.S. history. First Republic Bank’s failure became the second largest, trailing only Washington Mutual’s failure in 2008 and surpassing the 2023 failures of Silicon Valley Bank and Signature Bank.

[Read More…]

admin

admin

Next Post

Jelly Roll says Taylor Swift has had an 'incredible impact on the NFL' ahead of Super Bowl: 'The queen'

Recommended.

Stocks making the biggest moves midday: General Electric, Warner Bros. Discovery, UPS, 3M and more

Stocks making the biggest moves midday: General Electric, Warner Bros. Discovery, UPS, 3M and more

7 Best Cryptocurrency Stocks to Buy

7 Best Cryptocurrency Stocks to Buy

Trending.

Semaglutide Reduces Risk Of Harmful Cardiovascular Events And Death In People With Heart Failure, New Study Suggests

US launches missile-detecting satellites into orbit as concerns about Russia in space grow

Musk blasts FCC for ‘illegally’ pulling Starlink award, says it would’ve helped victims of Hurricane Helene

Should You Lower Your Mortgage Rate With Discount Points?

Why surge pricing is coming at restaurants, online retailers and more

New Credit Ideas

Subscribe Us =>


By clicking submit, I authorize New Credit Ideas and its affiliated companies to: (1) use, sell, and share my information for marketing purposes, including cross-context behavioral advertising, as described in our Terms of Service and Privacy Policy, (2) supplement the information that I provide with additional information lawfully obtained from other sources, like demographic data from public sources, interests inferred from web page views, or other data relevant to what might interest me, like past purchase or location data, (3) contact me or enable others to contact me by email with offers for goods and services from any category at the email address provided, and (4) retain my information while I am engaging with marketing messages that I receive and for a reasonable amount of time thereafter. I understand I can opt out at any time through an email that I receive, or by clicking here

  • Contact Us
  • Privacy Policy
  • Terms Of Service
  • Unsubscribe
  • Privacy Choices

© Copyright 2025 - New Credit Ideas All Rights Reserved.

No Result
View All Result
  • Home
  • Finance
  • Insurance
  • Loans
  • Mortgage
  • Shares

© Copyright 2025 - New Credit Ideas All Rights Reserved.

Skip to content
Open toolbar Accessibility Tools

Accessibility Tools

  • Increase TextIncrease Text
  • Decrease TextDecrease Text
  • GrayscaleGrayscale
  • High ContrastHigh Contrast
  • Negative ContrastNegative Contrast
  • Light BackgroundLight Background
  • Links UnderlineLinks Underline
  • Readable FontReadable Font
  • Reset Reset