(Reuters) – Shares of New York Community Bancorp plummeted another 11% on Tuesday, stretching a sell-off since the lender reported a surprise quarterly loss last week that puts the stock on track to shed more than half of its value at the current levels.
The sell-off since Wednesday has dragged down shares of peers on renewed fears about the health of the industry, even as analysts highlighted that the issues at the bank were specific to its balance sheet.
The capital-building exercise, which spurred a 70% cut to its dividend last week, was also a result of NYCB catching up with peers of the same size, analysts have said.
The lender has said it was boosting capital to deal with stricter regulatory requirements after the purchase of Signature Bank last year pushed assets above a $100 billion threshold.
Still, at least 13 brokerages have downgraded or lowered their price targets for the bank’s stock since the earnings report.
The increased regulatory requirement will curtail the bank’s “flexibility” as it focuses on building capital, Fitch said in its note announcing the downgrade, adding that the size of provisions NYCB took were “outside of Fitch’s baseline expectations.”
(Reporting by Niket Nishant in Bengaluru; Editing by Sriraj Kalluvila)
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