The sale will occur through a public underwriting. The offering will be held on May 19, closing before June 8. Barclays (NYSE:BCS) will manage the offering. NYCB is not selling any shares in the FDIC offering.
New York Community’s bank in Hicksville, on Long Island, acquired $38 billion of Signature Bank assets in March, including $13 billion in loans. NYCB is up 59% since it acquired the assets. Its stock rose 5% overnight, opening at about $10.70 per share, representing a market capitalization of $7.3 billion.
Is There a Happy Ending for NYCB Stock?
Signature Bank’s collapse, which the FDIC now blames on “poor management,” caused a regional banking crisis that is only now ebbing. The FDIC’s report said Signature’s investments in cryptocurrencies helped cause its collapse.
But Signature was also heavily involved in commercial real estate. That industry remains in crisis as demand for office space has fallen, with many employees working from home. The failed bank still has $60 billion in loans to sell. However, it is laying off its commercial real estate team at the end of the month. The layoffs were announced as former bank officials were criticized at a congressional hearing.
What Happens Next?
The happy ending for NYCB is a sad one for the region’s commercial real estate business, which must now find a new place to borrow money.
On the date of publication, Dana Blankenhorn held no positions in any companies mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.