New York Community Bank stands in Brooklyn, New York, on February 8, 2024.
Spencer Pratt | Getty Images
shares of new york community bancorp Shares fell more than 20% in after-hours trading Thursday after the regional financial institution announced management changes and disclosed internal control issues.
The regional bank announced that Executive Chairman Alessandro Dinero will assume the role of President and CEO, effective immediately. NYCB has come under pressure in recent months, due in part to concerns about its exposure to commercial real estate.
NYCB stock fell sharply in after-hours trading.
The bank also announced a restatement to its fourth quarter financial results that adds disclosure regarding internal risk management.
“As part of management’s assessment of the Company’s internal controls, the company identified significant changes in the Company’s internal controls related to internal loan reviews due to ineffective oversight, risk assessment, and monitoring activities,” the company said in a filing with the U.S. stock exchange. We have identified key weaknesses.” Exchange committee.
Dinero previously served as CEO of Flagstar Bank, which NYCB acquired in 2022. He was appointed NYCB’s executive chairman in early February, shortly after Moody’s Investors Service downgraded the bank’s credit rating to junk.
“While we have faced recent challenges, we are confident in our direction and our ability to serve our customers, employees and shareholders over the long term. The changes reflect that “a new chapter is underway,” Dinero said in a press release Thursday.
In another leadership change, Marshall Lux has been promoted to lead director on the NYCB board, replacing Hanif Dahiya. Mr. Lux served as global chief risk officer for JPMorgan’s Chase Consumer Bank from 2007 to 2009, according to a press release.
NYCB stock has fallen 53% since the beginning of the year, after the company disclosed on January 31 that it had charged more than expected for potential loan losses. .
Loan loss concerns reignited concerns about the broader situation in the commercial real estate market and local banks. Several regional banks, including Silicon Valley Bank, failed in 2023 as customers and investors became concerned about the value of debt on banks’ balance sheets.
In fact, NYCB acquired Signature, one of the failed banks, last March.
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