Moody's places embattled lender NYCB on 'review for upgrade'
Reuters
Published Mar 07, 2024 08:06PM ET
(Reuters) - Ratings agency Moody's (NYSE:MCO) said on Thursday it had changed the direction of its rating view of New York Community Bancorp (NYSE:NYCB) to "review for upgrade" from "review for downgrade".
The new rating follows the bank's announcement on Wednesday that it had raised $1 billion from investors including former U.S. Treasury Secretary Steven Mnuchin's Liberty Strategic Capital and also named Joseph Otting, a former Comptroller of the Currency, as its new CEO.
Moody's changed the direction of its review as the capital raise will increase NYCB's common equity tier 1 (CET1) ratio - a key measure of financial strength - to 10.3% on a proforma basis, assuming full conversion of the preferred equity to common, from 9.2% reported at Dec. 31, 2023.
NYCB's "planned capital raise could help stabilize its franchise following the tumultuous series of events that have occurred in recent weeks, and could improve its creditworthiness," according to Moody's.
The agency also continues to believe that NYCB may have to further increase its provisions for credit losses.
Last week, Moody's had downgraded NYCB's long-term issuer rating to "B3" from "Ba2".
NYCB's new CEO said earlier on Thursday that the company is seeing interest from non-bank bidders for some of its loans and will outline a new business plan next month, after the bank slashed its dividend again and disclosed deposits fell 7%.
Get The News You Want
Written By: Reuters
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.