Yahoo Finance New York Community (NYCB) Reports Loss in Q1, Cuts Dividend
New York Community Bancorp NYCB reported the first-quarter 2024 loss of 25 cents per share compared with the Zacks Consensus Estimate of a loss of 13 cents. It reported earnings of 23 cents in the year-ago quarter.
The results were primarily affected by a significant rise in provisions for credit losses and expenses. A fall in non-interest income and lower deposit balance were additional concerns. However, substantial growth in net interest income (NII) acted as a tailwind.
The net loss to common stockholders was $335 million against a net income of $1.99 billion in the prior-year quarter.
Revenues Decline, Expenses Rise
Quarterly revenues were $633 million, which declined 76% from the prior-year quarter. The top line also missed the Zacks Consensus Estimate of $779.5 million.
NII was $624 million, up 12% from the prior-year quarter. The net interest margin of 2.28% was down 32 basis points.
Non-interest income was $9 million, down year over year from $2.09 billion.
Non-interest expenses of $699 million jumped 47% from the year-ago quarter.
The efficiency ratio was 82.47%, up year over year from 60.21%. A rise in the efficiency ratio indicates deteriorating profitability.
Total loans and leases held for investment declined 3% sequentially to $82.3 billion as of Dec 31, 2023. As of Dec 31, 2024, total deposits decreased 8% sequentially to $84.8 billion.
Credit Quality Deteriorates
Non-performing assets were $811 million, which increased significantly from $174 million as of Mar 31, 2023.
Also, the provision for credit losses was $315 million, which increased substantially from $170 million in the prior-year quarter. Net charge-offs were $81 million, while the company did not record any net charge-offs in the prior-year quarter.
Capital Ratios Improve
As of Dec 31, 2024, the common equity tier 1 ratio was 9.45%, which increased from 9.05% as of Dec 31, 2023. The total risk-based capital ratio was 13.09%, which rose from 11.77%.
The leverage capital ratio was 7.90%, which improved from 7.75%.
Dividend Cut
New York Community declared a quarterly cash dividend of 1 cent per share, reducing it 80% sequentially. The dividend will be paid out on Jun 17 of record as of Jun 7.
Conclusion
In the quarter, the company raised $1.05 billion in capital investment, anchored by Liberty Strategic Capital. However, due to weakness in the commercial real estate market, it increased its credit reserve in the quarter. The company also anticipates a high level of loan loss provision over the remainder of 2024. This might affect bottom-line growth.
New York Community Bancorp, Inc. Price, Consensus and EPS Surprise
New York Community Bancorp, Inc. price-consensus-eps-surprise-chart | New York Community Bancorp, Inc. Quote
NYCB currently has a Zacks Rank #4 (Sell).
You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
Performances of Other Banks
Texas Capital Bancshares, Inc. TCBI reported first-quarter 2024 EPS of 62 cents (excluding non-recurring items), which beat the Zacks Consensus Estimate of 59 cents. However, earnings compared unfavorably with 70 cents in the year-ago quarter.
TCBI's results benefited from an increase in non-interest income, and higher loan and deposit balances. Additionally, a strong capital position and lower provisions were other positives. However, a decline in NII and an increase in expenses were the undermining factors.
Citizens Financial Group CFG reported first-quarter 2024 EPS of 65 cents, missing the Zacks Consensus Estimate of 75 cents. The bottom line declined from $1 in the year-ago quarter.
Underlying EPS for the first quarter of 2024 was 79 cents, down from $1.10 in the year-ago quarter.
CFG’s results were affected by lower NII, and increased provisions and operating expenses. However, a rise in non-interest income and lower allowance for credit losses offered some support.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Texas Capital Bancshares, Inc. (TCBI) : Free Stock Analysis Report
New York Community Bancorp, Inc. (NYCB) : Free Stock Analysis Report
Citizens Financial Group, Inc. (CFG) : Free Stock Analysis Report
