BREAKING NEWSNew York Community Bank shares fall ANOTHER 40 percent in an hour today and trading is halted as it urgently seeks funding
- Shares in NYCB plunged another 40 percent on Wednesday morning
- They have now lost more than 80 percent of their value since the end of January
Shares of New York Community Bank fell another 40 percent on Wednesday after it was reported the bank was seeking a cash injection.
The trading of shares in the bank was also halted multiple times during the morning session.
A halt is a temporary pause in trading to allow the market to adjust to a rapidly developing situation and can prevent a crash.
Shares were down to $1.86 at 1pm ET - having lost more than 80 percent of their value since the end of January.
Earlier on Wednesday the lender was seeking a cash infusion and gauging investor interest in its stock, a person familiar with the matter told Reuters.
New York Community Bank has been facing a crisis over souring commercial real estate loans
Shares were down to $1.86 at 1pm ET and trading was halted several times
The bank, with 420 branches and hundreds of thousands of customers, has faced a crisis in recent months after the quality of its commercial real estate loans soured and ratings agencies downgraded its credit status to junk.
Companies are giving up on offices and downtown retail spaces - after Covid normalized working from home and catalyzed the decline of downtown shopping.
That left the owners of commercial buildings unable to pay lenders like New York Community Bank (NYCB). Some 16 percent of its loans are for commercial real estate acquisition, development and construction.
The bank's share price first started to fall at the end of January - after it cut its dividend and posted a surprise loss.
On the last day of the month they plummeted 38 percent from $10.38 to $5.47.
Then, last week, the Long Island-based bank disclosed it had identified 'material weaknesses' in internal controls tied to its review of loans.
Covid normalized working from home and catalyzed the decline of downtown shopping
Shares fell further after it amended its fourth-quarter results to report losses 10 times higher than it had previously, citing a $2.4 billion charge which it associated with pre-2007 purchases.
Losses since January are now up to about 82 percent.
On Thursday, the bank also announced that its executive chairman Alessandro DiNello would take on the role of president and CEO, effective immediately.
New York Community Bank did not immediately respond to DailyMail.com's request for comment on Wednesday afternoon.
