NEW YORK COMMUNITY BANCORP, INC. ANNOUNCES OVER $1 BILLION EQUITY INVESTMENT ANCHORED BY FORMER U.S. TREASURY SECRETARY STEVEN MNUCHIN'S LIBERTY STRATEGIC CAPITAL, HUDSON BAY AND REVERENCE CAPITAL
- Over $1 billion investment from Liberty, Hudson Bay, Reverence, and others.
- Former Secretary Mnuchin and Joseph Otting to join NYCB's Board.
- Joseph Otting to become CEO, Sandro DiNello named Non-Executive Chairman.
- Transaction to create a well-capitalized $100+ billion national bank.
- Strong balance sheet and liquidity position with a diversified deposit base.
- Equity capital raise through sale of common and convertible preferred stock.
- Transaction expected to close on or around March 11, 2024.
- Jefferies LLC as exclusive financial advisor and placement agent to NYCB.
- None.
Former Secretary Steven Mnuchin, Joseph Otting, Allen Puwalski and Milton Berlinski to Join NYCB Board of Directors
Joseph Otting to Become CEO and Alessandro DiNello to be Named as Non-Executive Chairman
Investment is Strong Endorsement of New Management Team; Creates Strong Balance Sheet
Reconstituted Board and Management Team Positioned to Deliver Well Capitalized
In connection with the transaction, the Company will add four new directors to its Board, including Steven Mnuchin, the 77th Secretary of the Treasury, Joseph Otting, former Comptroller of the Currency, Allen Puwalski from Hudson Bay, and Milton Berlinski, Managing Partner of Reverence Capital.
In addition, Mr. Otting will become Chief Executive Officer and Mr. DiNello will be named as Non-Executive Chairman, providing his strong banking knowledge in support of Mr. Otting and the Board. Mr. Otting served as the 31st Comptroller of the Currency and has had a long, distinguished career in banking including, having served as CEO of OneWest Bank from 2010 to 2015 and as Acting Director of the Federal Housing Finance Agency in 2018.
Secretary Steven Mnuchin stated, "In evaluating this investment, we were mindful of the Bank's credit risk profile. With the over
Non-Executive Chairman Sandro DiNello stated, "We welcome the approach that Liberty and its partners took in its evaluation of the Bank and look forward to incorporating their insights going forward. The strategic investment involving former Secretary Steven Mnuchin, former Comptroller Joseph Otting and Milton Berlinski, along with the other institutional investors is a positive endorsement of the turnaround that is underway and allows us to execute on our strategy from a position of strength. We enter this next chapter with a strong balance sheet and liquidity position supported by a diversified and retail focused deposit base. Our new leadership team, with the support of the reconstituted Board, will continue to take the actions that are necessary to improve earnings, profitability and drive enhanced value for shareholders."
Secretary Mnuchin stated, "We decided to make this investment because we believe Sandro, alongside new management, has taken the appropriate actions to stabilize the Company and to position NYCB to become a best-in-class
Mr. Berlinski added, "We are excited to be investing behind this management team with such a strong investor group and believe NYCB has a great opportunity to reposition the company and return to growth. NYCB franchise is well positioned for continued success with the addition of former Comptroller Otting."
As part of the reconstitution, the Board will be reduced to nine members and will include Secretary Mnuchin, Mr. Otting, Mr. Puwalski, Mr. Berlinski, Mr. DiNello, Marshall Lux, Peter Schoels, Jennifer Whip and David Treadwell.
Transaction Details
In connection with the equity capital raise transaction, NYCB will sell and issue, in the aggregate, to the Investors shares of common stock of the Company at a price per share of
Holders of the preferred stock will not have voting rights and will be entitled to quarterly non-cumulative cash dividends, as and if declared by the Board. Each share of preferred stock is convertible into common stock on a 1 preferred share – 1,000 common shares basis. Series B preferred stock will automatically convert upon certain transfers permitted by federal banking regulations and stockholder approval of a charter amendment to increase the Company's authorized common stock, while Series C preferred stock will automatically convert upon the achievement of certain trigger events related to receipt of antitrust clearance under the Hart Scott Rodino Act and the charter amendment. The Company will provide customary shelf and piggyback registration rights to each of the Investors. Additionally, Liberty will also have the ability to request an underwritten shelf take-down and block trade rights.
Timing and Approvals
The transaction is expected to close on or around Monday, March 11, 2024, subject to the satisfaction of certain closing conditions, receipt of any regulatory approvals required in connection with the new roles of Mr. Otting and Mr. DiNello, and the filing of a supplemental listing application required to authorize for listing on the New York Stock Exchange the shares of common stock issued under each investment agreement and to be issued upon the conversion of shares of the preferred stock issued under the investment agreements.
Advisors
Jefferies LLC is acting as exclusive financial advisor and sole placement agent to NYCB. Skadden, Arps, Slate, Meagher & Flom LLP is serving as legal counsel to NYCB. Sullivan & Cromwell LLP is serving as legal counsel to Liberty Strategic Capital.
About New York Community Bancorp, Inc.
New York Community Bancorp, Inc. is the parent company of Flagstar Bank, N.A., one of the largest regional banks in the country. The Company is headquartered in
Flagstar Bank, N.A. operates 420 branches, including strong footholds in the Northeast and Midwest and exposure to high growth markets in the Southeast and West Coast. Flagstar Mortgage operates nationally through a wholesale network of approximately 3,000 third-party mortgage originators. In addition, the Bank has 134 private banking teams located in over ten cities in the metropolitan
New York Community Bancorp, Inc. has market-leading positions in several national businesses, including multi-family lending, mortgage origination and servicing, and warehouse lending. Flagstar Mortgage is the seventh largest bank originator of residential mortgages for the 12-months ending December 31, 2023, while we are the industry's fifth largest sub-servicer of mortgage loans nationwide, servicing 1.4 million accounts with
About Liberty Strategic Capital
Liberty Strategic Capital is a
About Hudson Bay
Hudson Bay Capital is a multi-billion-dollar global investment management firm operating in
About Reverence Capital
Reverence Capital Partners is a private investment firm focused on three complementary strategies: (i) Financial Services-Focused Private Equity, (ii) Opportunistic, Structured Credit, and (iii) Real Estate Solutions. Today, Reverence manages in excess of
Forward Looking Statements
This press release may include forward–looking statements by the Company pertaining to such matters as our goals, intentions, and expectations regarding revenues, earnings, loan production, asset quality, capital levels, and acquisitions, among other matters; our estimates of future costs and benefits of the actions we may take; our assessments of probable losses on loans; our assessments of interest rate and other market risks; and our ability to achieve our financial and other strategic goals, including those related to our merger with Flagstar Bancorp, Inc., which was completed on December 1, 2022, the Signature Transaction, and our transition to a
Forward–looking statements are typically identified by such words as "believe," "expect," "anticipate," "intend," "outlook," "estimate," "forecast," "project," "should," and other similar words and expressions, and are subject to numerous assumptions, risks, and uncertainties, which change over time. Additionally, forward–looking statements speak only as of the date they are made; the Company does not assume any duty, and does not undertake, to update our forward–looking statements. Furthermore, because forward–looking statements are subject to assumptions and uncertainties, actual results or future events could differ, possibly materially, from those anticipated in our statements, and our future performance could differ materially from our historical results.
Our forward–looking statements are subject to the following principal risks and uncertainties: general economic conditions and trends, either nationally or locally; conditions in the securities markets; changes in interest rates; changes in deposit flows, and in the demand for deposit, loan, and investment products and other financial services; changes in real estate values; changes in the quality or composition of our loan or investment portfolios; changes in future allowance for credit losses requirements under relevant accounting and regulatory requirements; the ability to pay future dividends at currently expected rates; changes in our capital management and balance sheet strategies and our ability to successfully implement such strategies; changes in competitive pressures among financial institutions or from non–financial institutions; changes in legislation, regulations, and policies; the success of our blockchain and fintech activities, investments and strategic partnerships; the restructuring of our mortgage business; the impact of failures or disruptions in or breaches of the Company's operational or security systems, data or infrastructure, or those of third parties, including as a result of cyberattacks or campaigns; the impact of natural disasters, extreme weather events, military conflict (including the
More information regarding some of these factors is provided in the Risk Factors section of our Annual Report on Form 10–K for the year ended December 31, 2022, Quarterly Reports on Form 10-Q for the quarters ended March 31, 2023, June 30, 2023, and September 30, 2023 and in other SEC reports we file. Our forward–looking statements may also be subject to other risks and uncertainties, including those we may discuss in this Amendment, during investor presentations, or in our other SEC filings, which are accessible on our website and at the SEC's website, www.sec.gov.
Important Information and Where You Can Find It
This press release may be deemed to be solicitation material in respect of a charter amendment. In connection with the requisite stockholder approval, NYCB will file with the SEC a preliminary proxy statement and a definitive proxy statement, which will be sent to the stockholders of NYCB, seeking certain approvals related to the issuances of shares of common stock issued under each investment agreement and to be issued upon the conversion of shares of the preferred stock issued under the investment agreements.
INVESTORS AND SECURITY HOLDERS OF NYCB AND THEIR RESPECTIVE AFFILIATES ARE URGED TO READ, WHEN AVAILABLE, THE PROXY STATEMENT AND ANY OTHER RELEVANT DOCUMENTS FILED OR TO BE FILED WITH THE SEC IN CONNECTION WITH THE TRANSACTION, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THOSE DOCUMENTS, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT NYCB AND THE TRANSACTION. Investors and security holders will be able to obtain a free copy of the proxy statement, as well as other relevant documents filed with the SEC containing information about NYCB, without charge, at the SEC's website (http://www.sec.gov). Copies of documents filed with the SEC by NYCB can also be obtained, without charge, by directing a request to Investor Relations, New York Community Bancorp, Inc., 102 Duffy Avenue,
Participants in the Solicitation of Proxies in Connection with Proposed Transaction
NYCB and certain of their respective directors, executive officers and employees may be deemed to be participants in the solicitation of proxies in respect of the requisite stockholder approvals under the rules of the SEC. Information regarding NYCB's directors and executive officers is available in its definitive proxy statement for its 2023 annual stockholders meeting, which was filed with the SEC on April 21, 2023, and certain of its Current Reports on Form 8-K. Other information regarding the participants in the solicitation of proxies in respect of the proposed transaction and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the proxy statement and other relevant materials to be filed with the SEC. Free copies of these documents, when available, may be obtained as described in the preceding paragraph.
Not an Offer of Securities
The information in this communication is for informational purposes only and shall not constitute, or form a part of, an offer to sell or the solicitation of an offer to sell or the solicitation of an offer to buy any securities. The securities that are the subject of the private placement have not been registered under the Securities Act and may not be offered or sold in
Investor Contact:
Salvatore J. DiMartino
(516) 683-4286
Media Contact:
Steven Bodakowski
(248) 312-5872
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SOURCE New York Community Bancorp, Inc.
FAQ
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