New York Community Bancorp said Wednesday it has raised $1 billion in equity investments from investors including former U.S. Treasury Secretary Steven Mnuchin’s Liberty Strategic Capital.
According to the NYCB, Hudson Bay Capital, Reverence Capital Partners, Citadel Securities, other institutional investors and some members of the bank’s management also participated in the contribution.
The bank has been under pressure since it reported a surprise fourth-quarter loss, weighed down by higher provisions linked to its exposure to the commercial real estate (CRE) sector.
It cut its quarterly dividend by 70% to shore up capital and cope with tougher regulation facing banks with assets of $100 billion or more. Its acquisition of Flagstar Bank in 2022 and Signature Bank’s assets last year put it above that threshold.
Last week, the NYCB revealed that it had found “material weaknesses” in internal controls related to loan reviews. The bank revised its quarterly loss to 10 times what it previously stated.
At last price, shares fell more than 40% in New York. Trading had been suspended this afternoon due to the release of the investment statement.
Source: Terra
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