New York Community Bancorp - 70% decline in its stock price since January
NYCB, buffeted by fears over potential real-estate loan losses, weaknesses in its internal controls and a sharp drop in its stock price, has dispatched bankers to gauge investors’ interest in buying stock in the company, people familiar with the matter said.
There is no guarantee there will be a deal, or that one would succeed in addressing the bank’s challenges, which as of Wednesday morning had led to a roughly 70% decline in its stock price since January.
NYCB has been in crisis mode since the bank in January revealed signs of trouble in its commercial real-estate books, swung to a fourth-quarter loss and slashed its dividend.
Then last week, the bank disclosed that it had found “material weaknesses” in the way it assesses and monitors loans.
The disclosures have triggered several credit downgrades.
Wall Street Journal 6 March 2024
https://www.wsj.com/finance/new-york-community-bancorp-seeks-cash-infusion-6e4c0083
NYCB Raises More Than $1 Billion in Equity Led by Steven Mnuchin’s Firm
“In evaluating this investment, we were mindful of the bank’s credit risk profile,” Mnuchin, the former US Treasury secretary, said in the statement.
6 mars 2024 at 20:10 CET
Mnuchin’s firm and the other investors will buy common shares at $2 apiece and get some convertible preferred stock with a conversion price also at $2, to raise $1.05 billion in total.
While the bank’s statement didn’t provide full terms, the group will also get warrants with an exercise price of $2.50 per share.
The investment triggered a rally, with the stock closing at $3.46.
Bloomberg 7 March 2024
https://englundmacro.blogspot.com/search?q=NYCB+
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