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"We
have a clear path to profitability over the following two
years," newly appointed CEO Joseph Otting said in a statement.
NYCB has been looking to cut its exposure to rent-regulated
multi-family properties and office buildings in New York after
fears of borrowers defaulting on their loans prompted it to set
aside bigger rainy-funds.
The bank sees 2025 earnings per share (EPS) between 35 cents and
40 cents, higher than estimates of 28 cents, according to LSEG.
It also expects 2026 EPS between 50 cents and 60 cents, higher
than Wall Street's expectations of 36 cents.
Shares of the bank were last trading at $3.05. The stock is off
74% so far this year, after it posted a surprise quarterly loss
in January and announced a 70% cut in its dividend.
A month later, it also disclosed it had found "material
weakness" in internal controls and revised its loss to 10 times
higher than earlier due to a goodwill impairment charge.
NO RELIEF THIS YEAR
The bank sees loss in 2024 between 50 cents and 55 cents per
share, higher than the estimate of a 5 cent per share loss,
suggesting that there would be little relief this year.
"We anticipate an elevated level of loan loss provision over the
remainder of 2024 related to the potential for market and rate
conditions to impact borrower performance on certain portions of
our loan portfolio," Otting said.
Provision for credit losses rose to $315 million in the quarter,
compared with $170 million in the year-ago period.
NYCB has been trying to arrest a persistent stock rout that has
wiped billions off its market value, roughly a year after the
collapse of Silicon Valley Bank and Signature Bank ignited
widespread concerns over the health of the sector.
It received a $1 billion lifeline from an investor consortium
led by former U.S. Treasury Secretary Steven Mnuchin's Liberty
Strategic Capital in March that has helped shore up the bank for
the short-term.
The bank posted a loss of $327 million, or 45 cents per share,
in the three months ended March 31. That compares with a profit
of $2.01 billion, or $2.87 per share, in the year-ago period.
(Reporting by Niket Nishant and Manya Saini in Bengaluru;
Editing by Saumyadeb Chakrabarty)
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