Company Announcements

New York Community Bancorp, Inc. Reports Third Quarter 2020 Diluted EPS Of $0.23 On Continued Double-Digit NIM Expansion And Strong Loan Growth While 95% Of $3.1 Billion In Eligible Loan Deferrals Returned To Payment Status

WESTBURY, N.Y., Oct. 28, 2020 /PRNewswire/ --


Third Quarter 2020 Summary

Earnings :


-

Diluted EPS of $0.23, up 10% compared to the second quarter of the year and up 21% compared to the year-ago third quarter.


-

Net income available to common shareholders for the third quarter was $107.6 million, up 11% compared to the second quarter of the year and up 18% compared to the year-ago third quarter.


-

Pre-provision net revenue for the third quarter of 2020 totaled $167.1 million, up 6% relative to the second quarter of the year and up 22% compared to the year-ago third quarter. (1)


-

The efficiency ratio for the third quarter was 43.47%, down slightly compared to the second quarter of the year and compared to 47.37% in the year-ago third quarter.


-

Third quarter results included a provision for credit losses of $13.0 million, down 26% compared to the second quarter of the year.

Net Interest Margin/Income :


-

The net interest margin increased 11 bps to 2.29% compared to the second quarter of the year and was up 30 bps compared to the year-ago third quarter.


-

Prepayment income added nine bps to the third quarter NIM, same as in the previous quarter.  Excluding the impact from prepayments, the NIM on a non-GAAP basis would have been 2.20%, up 11 bps sequentially and 32 bps compared to the year-ago third quarter.


-

Net interest income for the third quarter increased 6% to $281.9 million compared to the second quarter and was up 19% compared to the year-ago third quarter driven by significantly lower interest expense.

Balance Sheet :


-

 Total loans held for investment grew $935 million on a year-to-date basis to $42.8 billion, up 3% annualized and increased $523 million, up 5% annualized  compared to the second quarter, led by continued growth in the multi-family portfolio and a rebound in specialty finance lending.


-

During the first nine months of 2020, multi-family loans increased $942 million or 4% annualized to $32.1 billion and increased $504 million or 6% annualized on a sequential basis.


-

Specialty finance loans and leases totaled $3.1 billion, up $138 million or 19% annualized compared to the previous quarter and are up 22% annualized compared to the beginning of 2020.


-

Total deposits of $31.7 billion were relatively unchanged compared to both the previous quarter and to year-end 2019.

Asset Quality :


-

From June 30, 2020 through October 22nd, 95% of the $3.1 billion of loan deferrals eligible to come off of deferral returned to payment status and represented 7.3% of total loans as of this date compared to 14.4% at June 30, 2020.


-

Non-performing assets declined to $54.9 million or 0.10% of total assets, compared to $63.2 million or 0.12% of total assets as of June 30, 2020; NPAs included $32.0 million of non-performing taxi medallion loans compared to $33.6 million in the previous quarter.


-

The allowance for loan and lease losses increased $14.0 million to $188.3 million at September 30, 2020, compared to the previous quarter, and represented 415.22% of non-performing loans and 0.44% of total loans.

Capital Position at September 30, 2020 :


-

Common Equity Tier 1 Capital Ratio was 9.68%.


-

Tier 1 Risk-Based Capital Ratio was 10.94%.


-

Total Risk-Based Capital Ratio was 13.00%.


-

Leverage Capital Ratio was 8.42%.

(1)

Pre-provision net revenue is a non-GAAP measure, but we believe it is relevant to understanding the Company's financial results in light of the implementation of CECL and the economic impact of COVID-19.

New York Community Bancorp, Inc. (NYSE: NYCB) (the "Company") today reported net income for the three months ended September 30, 2020 of $115.8 million, up 10% compared to the $105.3 million we reported for the three months ended June 30, 2020 and up 17% compared to the $99.0 million the Company reported in the year-ago quarter.  For the nine months ended September 30, 2020, the Company reported net income of $321.4 million, up 9% compared to the $293.9 million of net income reported in the first nine months of 2019.

Net income available to common shareholders for the third quarter of 2020 totaled $107.6 million, up 11% compared to $97.1 million for the second quarter of 2020 and was up 18% compared to the $90.8 million reported for the third quarter of 2019.  On a year-to-date basis, net income available to common shareholders totaled $296.8 million, up 10% compared to the $269.2 million reported for the first nine months of 2019.

On a per share basis, the Company reported diluted EPS of $0.23 for the third quarter of 2020, up 10% compared to the $0.21 reported for the second quarter of 2020, and up 21% compared to the $0.19 reported for the third quarter of 2019.  For the first nine months of 2020, diluted EPS were $0.63, up 11% compared to diluted EPS of $0.57 for the first nine months of 2019.

Commenting on the Company's third quarter performance, President and Chief Executive Officer Joseph R. Ficalora stated: "We are very pleased with our strong third quarter results, especially given the uneven economic recovery and the lingering effects from the COVID-19 pandemic over the past quarter.  We had solid net income and EPS growth during the current third quarter, driven by strong loan growth and double-digit net interest margin expansion resulting in continued net interest income growth.  At the same time, operating expenses remained well-contained leading to higher levels of pre-provision net revenues.

"More importantly, our loan deferrals declined significantly.  From June 30, 2020 to October 22nd, $3.1 billion of loan deferrals were eligible to come off of their deferral period. As of October 22nd, 95% of these deferrals returned to payment status. As of this date, deferrals represented 7.3% of total loans compared to 14.4% as of June 30, 2020. Going forward, an additional $3.1 billion of deferrals are scheduled to come off of their deferral period, the majority of which are eligible to do so during November. Given October's strong payment performance, we remain confident about deferral payment trends through the remainder of the year.

"Our asset quality metrics remain very strong and rank among the best in the industry. Our NPAs declined on a linked quarter basis and we recorded a net recovery during the quarter. As always, we will continue to closely monitor our entire loan portfolio for any signs of stress.

"Our net interest margin increased 11 basis points to 2.29% during the third quarter, compared to the second quarter level.  Excluding the impact from prepayment income, the margin also increased 11 basis points to 2.20%.  The continued improvement was the result of lower funding costs as our maturing certificates of deposits repriced significantly lower during the quarter, while the cost of our borrowings also declined. At the same time, loan yields were relatively stable, down only five basis points on a sequential basis.

"On the lending side, our loan portfolio grew, both on a year-to-date and sequential basis.  Overall, loans grew 3% annualized on a year-to-date basis and 5% on an annualized basis compared to the prior quarter.  The linked-quarter growth was driven by ongoing growth in our core multi-family portfolio and a rebound in our specialty finance portfolio.  We ended the third quarter with a solid loan pipeline, which bodes positively for fourth quarter loan growth.

"Finally, reflecting our earnings growth, capital position, and strong asset quality metrics, yesterday our Board of Directors declared a quarterly cash dividend of $0.17 per common share."

DIVIDEND DECLARATION

The Board of Directors yesterday declared a quarterly cash dividend of $0.17 per share on the Company's common stock.  Based on a closing price of $8.33 as of October 27, 2020, this represents an annualized dividend yield of 8.2%.  The dividend is payable on November 17, 2020 to common shareholders of record as of November 7, 2020.

BALANCE SHEET SUMMARY

At September 30, 2020, assets totaled $54.9 billion, up $1.3 billion compared to December 31, 2019.  This growth was primarily due to continued loan growth offset somewhat by a decline in the securities portfolio. This growth was funded mainly through wholesale borrowings while total deposits were relatively unchanged.

Total loans and leases held for investment increased to $42.8 billion, up $935 million or 3% annualized compared to December 31, 2019 and up $523 million or 5% annualized compared to June 30, 2020.  Loan growth for both the year-to-date and quarter-to-date periods was driven by growth in our multi-family portfolio and in our specialty finance portfolio, offset by a decline in the commercial real estate ("CRE") portfolio.

Total securities, consisting mainly of available-for-sale securities, declined $621 million compared to December 31, 2019 but increased modestly compared to June 30, 2020.  The Company has refrained from meaningfully growing the securities portfolio, given the currently low interest rate environment, which is expected to persist in the foreseeable future.

On the liability side, total deposits of $31.7 billion were relatively unchanged compared to both the previous quarter and compared to the levels at December 31, 2019.  However, the deposit mix is trending toward lower cost deposit account categories. Borrowed funds rose $1.1 billion compared to December 31, 2019 and $675 million compared to June 30, 2020.

Loans

Total multi-family loans rose $942 million or 4% annualized to $32.1 billion compared to the balance at December 31, 2019.  On a linked-quarter basis, total multi-family loans increased $504 million or 6% annualized compared to June 30, 2020.  The continued growth in our multi-family portfolio is the result of three factors:  increased refinancing activity as many loans are nearing their contractual maturity or option repricing dates; higher retention rates; and market share gains as some bank and thrift competitors have either retrenched from this market or are no longer focused on this type of lending.

The specialty finance portfolio rebounded during the third quarter.  Specialty finance loans and leases increased $138 million to $3.1 billion or 19% annualized compared to the second quarter of this year.  On a year-to-date basis, specialty finance loans and leases grew $439 million or 22% annualized compared to December 31, 2019.  During second-quarter 2020, the COVID-19 pandemic had a temporary negative impact on this category, especially in the dealer financing segment.  This segment returned to form during the third quarter while other borrowers have drawn on their lines during the current quarter as their businesses have improved.

The CRE loan portfolio declined $197 million or 4% annualized compared to the balance at December 31, 2019, and declined $45 million or 3% annualized compared to the balance at June 30, 2020.

Additionally, as of September 30, 2020, the Company had $117.3 million of loans held for sale, up $14 million compared to June 30, 2020.  All of these loans are part of the Paycheck Protection Program (the "PPP").  At December 31, 2019, the Company did not have any loans held for sale.

During the third quarter, the average loan size for our multi-family loans was $6.6 million and for our CRE loans, it was $6.7 million.  Both metrics were relatively unchanged compared to the average loan size in the previous quarter.

The weighted average life of the multi-family portfolio for the third quarter of the year was 2.0 years compared to 1.9 years for the second quarter of the year, and for the CRE portfolio, it was 2.3 years, unchanged compared to the prior quarter.

Originations

For the three months ended September 30, 2020, loans and leases originated for investment, excluding PPP loan originations, totaled $3.0 billion, down 9% compared to June 30, 2020 and exceeded that quarter's pipeline by $800 million.  Originations rose 31% compared to the $2.3 billion we originated during the third quarter of last year.  For the nine months ended September 30, 2020, originations totaled $9.0 billion, up 23% compared to $7.3 billion for the nine months ended September 30, 2019.

Pipeline

The current loan pipeline stands at $1.8 billion.  Of this amount, approximately 61% is new money, slightly better than the previous quarter.  The current pipeline composition includes $1.4 billion in multi-family loans, $141 million in specialty finance loans and leases, and $199 million in CRE loans.

Funding

Deposits

In line with the Company's strategy to substantially reduce its cost of funds given the significant drop in market interest rates and the correct expectation that market rates will remain low for an extended period of time, CDs declined $1.1 billion during the third quarter and $3.2 billion on a year-to-date basis to $11.0 billion.

Some of the drop in CDs was offset by growth in other deposit categories, which have lower rates. Interest-bearing checking and money market accounts rose $553 million, while they increased $1.5 billion on a year-to-date basis, to $11.7 billion. Savings accounts increased $340 million to $6.0 billion compared to the second quarter and they rose $1.2 billion compared to year end 2019. Also, non-interest-bearing checking accounts grew $135 million on a linked-quarter basis and $624 million on a year-to-date basis to $3.1 billion.

Looking ahead, the Company has $5.8 billion in CDs which are scheduled to mature during the fourth quarter of this year.  These CDs carry a weighted average interest rate of 1.46%.  Over the next four quarters (fourth quarter 2020 through third quarter 2021), the Company has $11.6 billion of CDs with a weighted average interest rate of 1.21% which are scheduled to mature.

During the current third quarter, our deposit costs dropped 31 basis points to 0.85% compared to the second quarter of 2020 and 104 basis points compared to the year-ago quarter.  For the nine months ended September 30, 2020, our deposit costs declined 65 basis points to 1.21% compared to the nine months ended September 30, 2019.

Borrowings

During the third quarter of 2020, the Company continued to take advantage of the low interest rate environment and favorable capital market conditions to lock in intermediate-to-long-term funding at attractive rates.  Wholesale borrowings, consisting primarily of advances from the Federal Home Loan Bank of New York (the "FHLB-NY") increased $675 million to $15.0 billion compared to the previous quarter and rose $1.1 billion compared to the level at year-end 2019.

The FHLB-NY advances that the Company added during the current quarter had a blended rate of 0.45% and an average term of 2.0 years.  This compared to an overall average cost of 1.97% during the current quarter.  The Company has an additional $725 million of FHLB-NY advances maturing in the fourth quarter of 2020 with an average weighted cost of 1.18%.  Over the next four quarters (fourth quarter 2020 through third quarter 2021), we have $1.4 billion of maturing FHLB-NY advances with a weighted average cost of 1.44%.

Liquidity

Our liquidity position remained robust during the current third quarter.  In addition to the ample liquidity provided to us from our deposits, other sources of available liquidity stems from our balance of cash and cash equivalents and the unencumbered portion of our securities portfolio.  Additional significant sources of liquidity available to the Company include approved lines of credit with various counterparties, including borrowing facilities with the FHLB-NY and with the Federal Reserve Bank of New York (the "FRB-NY").

As of September 30, 2020, our available funding with the FHLB-NY was $7.3 billion and with the FRB-NY, it was $1.1 billion.  Additionally, the unencumbered portion of the securities portfolio totaled $3.9 billion.

Asset Quality

Loan Deferral Update

During the second quarter of 2020, the Company implemented various loan modification programs with some of its borrowers, in accordance with the Coronavirus Aid, Relief, and Economic Security Act (the "CARES Act").  These modifications were primarily full-payment deferrals for an initial six-month period, with the ability to extend again at the end of the deferral period, at the Bank's discretion.

From June 30, 2020 to October 22, 2020, we had $3.1 billion of loan deferrals that were eligible to come off of their deferral period. As of October 22nd, approximately $3.0 billion or 95% of these deferrals returned to payment status, while the remaining 5% or $157 million have come off deferral but are still due for their first payment. We continue to work with these borrowers on a case by case basis to provide additional assistance, if needed, in line with regulatory guidance and the CARES Act.

Going forward, we have an additional $3.1 billion of loan deferrals eligible to come off of their deferral periods, $2.9 billion of which, are scheduled to do so during November.

Non-Performing Assets

Our asset quality metrics improved this quarter and continue to reflect the underlying strength of our loan portfolio.  Non-performing assets ("NPAs") at September 30, 2020 were $54.9 million compared to $63.2 million at June 30, 2020, down 13%.  This reflects 10 basis points of total assets compared to 12 basis points in the previous quarter.  Total non-accrual mortgage loans were $18.4 million compared to $24.2 million at June 30, 2020, down 24%.  Other non-accrual loans were $26.9 million compared to $29.5 million in the previous quarter, down 9%.

Total repossessed assets were $9.5 million at September 30, 2020, unchanged from the previous quarter. Of this amount, $7.6 million were taxi medallion-related, also unchanged from the previous quarter.

As in previous quarters, the majority of our non-performing assets were comprised of non-performing taxi medallion-related loans and repossessed taxi medallion-related assets.  Excluding the impact from non-performing taxi medallion-related assets, our third quarter 2020 NPAs would have been $22.9 million or four basis points of total assets compared to $29.6 million or five basis points at June 30, 2020.

Allowance for Loan and Lease Losses

At September 30, 2020, the allowance for loan and lease losses ("ALLL") was $188.3 million, up $40.7 million from December 31, 2019 and up $14.0 million from June 30, 2020.  At September 30, 2020, the ALLL represented 415.22% of non-performing loans and 0.44% of total loans. Both the year-to-date and quarter-to-date increases reflect the Company's adoption of the Current Expected Credit Losses ("CECL") methodology on January 1, 2020 and also reflects deterioration in forecasted economic conditions since the beginning of the year arising from the COVID-19 pandemic, primarily the result of estimated decreases in property values.







Unfunded 

(in thousands)



Loans and Leases


Commitments

Allowance for credit losses at December 31, 2019


$147,638


$461

   CECL Day 1 Transition Adjustment


1,911


12,529

   YTD 2020 Provision for (recovery of) credit losses


51,837


(645)

   YTD 2020 (net charge-offs)/recoveries


-13,079


0

Allowance for credit losses at June 30, 2020


$188,307


$12,345

 

CAPITAL POSITION

The Company's capital position remains strong at both the holding company level and at the Bank level, as all of our regulatory capital ratios continue to exceed regulatory minimums to be classified as "Well Capitalized," the highest regulatory classification.

The table below depicts the Company's and the Bank's regulatory capital ratios at those respective periods.


September 30,


June 30,


September 30,




2020


2020


2019



REGULATORY CAPITAL RATIOS: (1)








New York Community Bancorp, Inc.








Common equity tier 1 ratio

9.68

%

9.77

%

10.15

%


Tier 1 risk-based capital ratio

10.94


11.06


11.49



Total risk-based capital ratio

13.00


13.13


13.61



Leverage capital ratio

8.42


8.42


8.65



New York Community Bank








Common equity tier 1 ratio

12.20

%

12.37

%

12.76

%


Tier 1 risk-based capital ratio

12.20


12.37


12.76



Total risk-based capital ratio

12.65


12.80


13.16



Leverage capital ratio

9.40


9.42


9.60











(1)

The minimum regulatory requirements for classification as a well-capitalized institution are a common equity tier 1 capital ratio of 6.5%; a tier one risk-based capital ratio of 8.00%; a total risk-based capital ratio of 10.00%; and a leverage capital ratio of 5.00%.

 

EARNINGS SUMMARY FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2020

Net Interest Income

Net interest income for the three months ended September 30, 2020 totaled $281.9 million, up $16.0 million or 6% compared to the three months ended June 30, 2020 and up $46.0 million or 19% compared to the three months ended September 30, 2019.  Both the quarter-over-quarter and year-over-year increases in our net interest income were driven by significantly lower levels of interest expense.  Interest expense for the three months ended September 30, 2020 declined $21.0 million or 13% to $136.2 million, on a quarter-over-quarter basis, while on a year-over-year basis it decreased $82.5 million or 38%.  These decreases were largely driven by lower deposit costs, driven primarily by lower CD rates.

Prepayment income for the three months ended September 30, 2020 was $11.6 million, up 2% compared to the previous quarter, but down 18% compared to the year-ago quarter.  Excluding the impact from prepayment income, net interest income on a non-GAAP basis would have been $270.3 million, up $15.8 million or 6% on a linked-quarter basis and up $48.5 million or 22% on a year-over-year basis.

For the nine months ended September 30, 2020, net interest income increased $77.3 million or 11% to $792.2 million compared to $714.9 million for the nine months ended September 30, 2019.  The year-to-date improvement was also due to significantly lower levels of interest expense due mainly to a substantial decline in the Company's cost of deposits.  Interest expense for the nine months ended September 30, 2020 dropped $149.6 million or 23% to $489.9 million compared to $639.5 million for the nine months ended September 30, 2019.

For the nine months ended September 30, 2020, prepayment income was $33.6 million, down 8% or $2.8 million compared to the nine months ended September 30, 2019.  Excluding the impact from prepayment income, net interest income on a non-GAAP basis would have been $758.6 million, up 12% or $80.0 million compared to the nine months ended September 30, 2020.














September 30, 2020








For the Three Months Ended


compared to
























September 30,


June 30,


September 30,


June 30,


September 30,








2020


2020


2019


2020


2019

















(Dollars in thousands)






























Total interest income





$        418,049


$          423,075


$        454,551


-1%


-8%

Total interest expense





136,163


157,203


218,636


-13%


-38%


Net interest income





$        281,886


$          265,872


$        235,915


6%


19%

Less:
















Total prepayment income





11,634


11,412


14,145


2%


-18%


Net interest income excluding prepayment income

$        270,252


$          254,460


$        221,770


6%


22%

 








For the Nine Months Ended






















September 30,


September 30,










2020


2019


% Change













(Dollars in thousands)






















Total interest income





$     1,282,166


$       1,354,477


-5%

Total interest expense





489,941


639,547


-23%


Net interest income





$        792,225


$          714,930


11%

Less:












Total prepayment income





33,583


36,335


-8%


Net interest income excluding prepayment income

$        758,642


$          678,595


12%

Net Interest Margin

The Company's net interest margin ("NIM") continued to expand at a double-digit pace during the current third quarter.  The NIM for the three months ended September 30, 2020 was 2.29%, up 11 basis points compared to the prior quarter and up 30 basis points compared to the third quarter of last year.

Both the quarter-over-quarter and year-over-year improvements were driven by significantly lower funding costs.  The overall cost of funds declined 22 basis points to 1.24% compared to the previous quarter and 80 basis points compared to the year-ago quarter.

This improvement was the result of a substantial decline in both the average cost of deposits and in the average cost of borrowed funds.  The average cost of deposits declined to 0.85% during the current third quarter, down 31 basis points compared to the previous quarter and down 104 basis points compared to the year-ago third quarter.  Our average cost of CDs during the third quarter was 1.52%, down 48 basis points compared to the second quarter and down 93 basis points compared to the third quarter of last year.  At the same time, the average cost of borrowings declined nine basis points to 1.97% compared to the previous quarter and 41 basis points compared to the year-ago quarter.

Prepayment income contributed nine basis points to the current quarter's NIM, unchanged compared to the contribution in the previous quarter and 11 basis points compared to the year-ago quarter.

Excluding the impact from prepayment income, the third quarter NIM, on a non-GAAP basis would have been 2.20%, up 11 basis points compared to the previous quarter and up 32 basis points compared to the year-ago quarter.

For the nine months ended September 30, 2020, our NIM was 2.16%, up 15 basis points compared to the nine months ended September 30, 2019.  Prepayment income contributed seven and 10 basis points, respectively, to the NIM.  Excluding the impact from prepayment income, the year-to-date NIM on a non-GAAP basis would have been 2.09% compared to 1.91%, up 18 basis points.

Provision for Credit Losses

During the current third quarter, the provision for credit losses was $13.0 million compared to $17.6 million in the previous quarter and $4.8 million in the year-ago third quarter.  The third quarter provision for credit losses exceeded net charge-offs by $13.9 million.

For the three months ended September 30, 2020, the Company reported a net recovery of $901,000 compared to net charge-offs of $3.8 million or 0.01% of average loans in the previous quarter and $6.5 million or 0.02% of average loans in the year-ago quarter.

For the nine months ended September 30, 2020, net charge-offs totaled $13.1 million or 0.03% of average loans compared to $15.8 million or 0.04% of average loans for the nine months ended September 30, 2019.

Importantly, we have not experienced any charge-offs on either a quarter-to-date or year-to-date basis in our multi-family, CRE, or specialty finance portfolios.

Pre-Provision Net Revenue ("PPNR")

The tables below details the Company's PPNR for the periods noted.

For the three months ended September 30, 2020, PPNR totaled $167.1 million, up $9.5 million or 6% compared to the three months ended June 30, 2020 and up $30.1 million or 22% compared to the three months ended September 30, 2019.















September 30, 2020









For the Three Months Ended


compared to


























September 30,


June 30,


September 30,


June 30,


September 30,









2020


2020


2019


2020


2019



















(Dollars in thousands)
































Net interest income





$        281,886


$          265,872


$        235,915


6%


19%


Non-interest income





13,768


15,380


24,386


-10%


-44%



Total revenues





$        295,654


$          281,252


$        260,301


5%


14%


Total non-interest expense





128,508


123,593


123,302


4%


4%



Pre-provision net revenue (PPNR)



167,146


157,659


136,999


6%


22%


Provision for credit losses





13,016


17,574


4,781


-26%


172%


Income before taxes





$        154,130


$          140,085


$        132,218


10%


17%


Income tax expense





38,360


34,738


33,172


10%


16%



Net Income





$        115,770


$          105,347


$         99,046


10%


17%


Preferred stock dividends





8,207


8,207


8,207


0%


0%



Net income available to common shareholders


$        107,563


$           97,140


$         90,839


11%


18%

 

For the nine months ended September 30, 2020, PPNR totaled $460.7 million, up $64.1 million or 16% compared to the nine months ended September 30, 2019.








For the Nine Months Ended






















September 30,


September 30,










2020


2019


% Change













(Dollars in thousands)






















Net interest income





$        792,225


$          714,930


11%

Non-interest income





46,047


66,768


-31%

          Total revenues





$        838,272


$          781,698


7%

Total non-interest expense





377,622


385,121


-2%

          Pre-provision net revenue (PPNR)



460,650


396,577


16%

Provision for credit losses





51,192


5,403


847%

Income before taxes





$        409,458


$          391,174


5%

Income tax expense





88,013


97,305


-10%

          Net Income





$        321,445


$          293,869


9%

Preferred stock dividends







24,621


24,621


0%

          Net income available to common shareholders


$        296,824


$          269,248


10%

 

Non-Interest Income

For the three months ended September 30, 2020, total non-interest income was $13.8 million, down 10% and 44% compared to the prior and year-ago quarters.  Third quarter 2020 results reflect a rebound in retail banking fee income, offset by lower bank-owned life insurance ("BOLI") income.  Additionally, the current third quarter included a net loss on securities of $284,000 compared to gains in the previous and year-ago quarters.  Results for the third quarter of 2019 included a $7.9 million gain on sale of a branch property in Florida.

For the nine months ended September 30, 2020, total non-interest income declined 31% to $46.0 million compared to $66.8 million for the nine months ended September 30, 2019.  The decline is attributable to the previously mentioned factors, including the waiver of certain retail banking fees due to COVID-19, lower net gains on securities, and the gain on sale of a branch property in Florida during the third quarter of last year.  This was partially offset by an increase in BOLI income.

Non-Interest Expense

For the three months ended September 30, 2020, non-interest expenses totaled $128.5 million, up $4.9 million or 4% compared to the previous quarter and up $5.2 million, also 4%, compared to the year-ago quarter.  Most of this increase was in the general and administrative expense category and largely relate to systems conversion-related expenses during the quarter.  As previously disclosed, the Company undertook an enterprise-wide system conversion, which occurred at the end of August.  The occupancy and equipment category increased $2.8 million, primarily due to COVID-19-related costs as many of our branches reopened during the third quarter and 25% of our back-office personnel returned to their offices. This was partially offset by a quarter-over-quarter and year-over-year decline in compensation and benefits expense.

The efficiency ratio for the third quarter of 2020 was 43.47%, down slightly compared to the previous quarter and compared to 47.37% compared to the year-ago third quarter.

For the nine months ended September 30, 2020, total non-interest expenses were $377.6 million, down $7.5 million or 2% compared to the nine months ended September 30, 2019.  Included in the year-to-date results for 2020 was a $4.4 million lease termination benefit, while the year-to-date 2019 results included certain items related to severance and branch rationalization totaling $10.4 million.

Income Taxes

Income tax expense for the three months ended September 30, 2020 totaled $38.4 million, up $3.6 million or 10% compared to the prior quarter and $5.2 million or 16% compared to the year-ago quarter. The effective tax rate for the current third quarter was 24.89% compared to 24.80% in the previous quarter and 25.09% in the year-ago quarter.  The increase during the current quarter is due to a higher level of pre-tax income compared to previous periods.

For the nine months ended September 30, 2020, income tax expense was $88.0 million and reflected an effective tax rate of 21.50% compared to $97.3 million and an effective tax rate of 24.88% for the nine months ended September 30, 2019.  The year-to-date 2020 income tax expense includes a $13.1 million tax benefit recorded in the first quarter of 2020, related to the Company's tax loss carryback as provided by certain tax provisions for corporations included in the CARES Act, as enacted on March 27, 2020.

About New York Community Bancorp, Inc.

Based in Westbury, NY, New York Community Bancorp, Inc. is a leading producer of multi-family loans on non-luxury, rent-regulated apartment buildings in New York City, and the parent of New York Community Bank. At September 30, 2020, the Company reported assets of $54.9 billion, loans of $42.9 billion, deposits of $31.7 billion, and stockholders' equity of $6.7 billion.

Reflecting our growth through a series of acquisitions, the Company operates 236 branches through eight local divisions, each with a history of service and strength: Queens County Savings Bank, Roslyn Savings Bank, Richmond County Savings Bank, Roosevelt Savings Bank, and Atlantic Bank in New York; Garden State Community Bank in New Jersey; Ohio Savings Bank in Ohio; and AmTrust Bank in Florida and Arizona.

Post-Earnings Release Conference Call

The Company will host a conference call on Wednesday, October 28, 2020, at 8:30 a.m. (Eastern Time) to discuss its third quarter 2020 performance. The conference call may be accessed by dialing (877) 407-8293 (for domestic calls) or (201) 689-8349 (for international calls) and asking for "New York Community Bancorp" or "NYCB." A replay will be available approximately three hours following completion of the call through 11:59 p.m. on November 1, 2020 and may be accessed by calling (877) 660-6853 (domestic) or (201) 612-7415 (international) and providing the following conference ID: 13710795. In addition, the conference call will be webcast at ir.myNYCB.com, and archived through 5:00 p.m. on November 25, 2020.

Cautionary Statements Regarding Forward-Looking Information

This earnings release and the associated conference call may include forward–looking statements by the Company and our authorized officers 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.

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: the effect of the COVID-19 pandemic, including the length of time that the pandemic continues, the potential imposition of future shelter in place orders or additional restrictions on travel in the future, the effect of the pandemic on the general economy and on the businesses of our borrowers and their ability to make payments on their obligation, the remedial actions and stimulus measures adopted by federal, state, and local governments; the inability of employees to work due to illness, quarantine, or government mandates; 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 competitive pressures among financial institutions or from non–financial institutions; our ability to obtain the necessary shareholder and regulatory approvals of any acquisitions we may propose; our ability to successfully integrate any assets, liabilities, customers, systems, and management personnel we may acquire into our operations, and our ability to realize related revenue synergies and cost savings within expected time frames; changes in legislation, regulations, and policies; the impact of recently adopted accounting pronouncements; and a variety of other matters which, by their nature, are subject to significant uncertainties and/or are beyond our control.

More information regarding some of these factors is provided in the Risk Factors section of our Form 10–K for the year ended December 31, 2019 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 news release, on our conference call, during investor presentations, or in our SEC filings, which are accessible on our website and at the SEC's website, www.sec.gov.

- Financial Statements and Highlights Follow  

 

NEW YORK COMMUNITY BANCORP, INC.

CONSOLIDATED STATEMENTS OF CONDITION






September 30,


December 31,


2020


2019


(unaudited)



(in thousands, except share data)




Assets




Cash and cash equivalents

$   1,458,641


$      741,870

Securities:




Available-for-sale

5,233,744


5,853,057

    Equity investments with readily




        determinable fair values, at fair value

31,448


32,830

Total securities

5,265,192


5,885,887

Loans held for sale

117,272


-

Mortgage loans held for investment:




Multi-family

32,124,324


31,182,079

Commercial real estate 

6,887,918


7,084,499

One-to-four family

274,387


380,684

Acquisition, development, and construction

85,902


200,464

Total mortgage loans held for investment

39,372,531


38,847,726

Other loans and leases held for investment: 




Specialty Finance

3,055,896


2,617,304

Commercial and industrial 

394,305


420,993

Other loans

6,487


8,132

Total other loans and leases  held for investment

3,456,688


3,046,429

Total loans and leases held for investment

42,829,219


41,894,155

Less:  Allowance for loan and lease losses

(188,307)


(147,638)

Total loans and leases, net

42,758,184


41,746,517

Federal Home Loan Bank stock, at cost

697,483


647,562

Premises and equipment, net

289,788


312,626

Operating lease right-of-use assets

271,515


286,194

Goodwill

2,426,379


2,426,379

Other assets 

1,764,573


1,593,786

Total assets

$ 54,931,755


$ 53,640,821

Liabilities and Shareholders' Equity




Deposits:




Interest-bearing checking and money market accounts

$ 11,693,982


$ 10,230,144

Savings accounts

5,964,981


4,780,007

Certificates of deposit

10,990,080


14,214,858

Non-interest-bearing accounts

3,055,898


2,432,123

Total deposits

31,704,941


31,657,132

Borrowed funds:




Wholesale borrowings

15,027,661


13,902,661

Junior subordinated debentures

360,157


359,866

Subordinated notes

295,485


295,066

Total borrowed funds

15,683,303


14,557,593

Operating lease liabilities

271,499


285,991

Other liabilities

537,282


428,411

Total liabilities

48,197,025


46,929,127

Shareholders' equity:




Preferred stock at par $0.01 (5,000,000 shares authorized): 




Series A (515,000 shares issued and outstanding)

502,840


502,840

Common stock at par $0.01 (900,000,000 shares authorized; 490,439,070 and 490,439,070




shares issued; and 463,904,084 and 467,346,781 shares outstanding, respectively)

4,904


4,904

Paid-in capital in excess of par

6,117,902


6,115,487

Retained earnings 

391,528


342,023

Treasury stock, at cost (26,534,986 and 23,092,289 shares, respectively)

(257,521)


(220,717)

Accumulated other comprehensive loss, net of tax:




Net unrealized gain on securities available for sale, net of tax

67,755


25,440

Pension and post-retirement obligations, net of tax

(55,137)


(59,136)

Net unrealized (loss) gain on cash flow hedges, net of tax

(37,541)


853

Total accumulated other comprehensive loss, net of tax

(24,923)


(32,843)

Total shareholders' equity

6,734,730


6,711,694

Total liabilities and shareholders' equity

$ 54,931,755


$ 53,640,821

 

NEW YORK COMMUNITY BANCORP, INC.

CONSOLIDATED STATEMENTS OF INCOME

(unaudited)






















For the Three Months Ended


For the Nine Months Ended


September 30,


June 30,


September 30,


September 30,


September 30,


2020


2020


2019


2020


2019











(in thousands, except per share data)










Interest Income:










Loans and leases

$    380,337


$    381,884


$    391,920


$ 1,154,133


$ 1,159,344

Securities and money market investments

37,712


41,191


62,631


128,033


195,133

Total interest income

418,049


423,075


454,551


1,282,166


1,354,477











Interest Expense:










Interest-bearing checking and money market accounts

9,328


10,059


42,465


47,951


140,396

Savings accounts 

7,593


8,208


9,326


24,735


26,270

Certificates of deposit

44,481


65,233


86,934


189,270


235,360

Borrowed funds

74,761


73,703


79,911


227,985


237,521

Total interest expense

136,163


157,203


218,636


489,941


639,547

Net interest income

281,886


265,872


235,915


792,225


714,930

Provision for credit losses

13,016


17,574


4,781


51,192


5,403

Net interest income after provision for credit losses

268,870


248,298


231,134


741,033


709,527











Non-Interest Income:










Fee income

5,240


3,723


7,580


15,981


22,295

Bank-owned life insurance

7,566


9,503


6,791


24,458


20,245

Net (losses) gains on securities 

(284)


887


275


1,137


7,755

Other income 

1,246


1,267


9,740


4,471


16,473

Total non-interest income  

13,768


15,380


24,386


46,047


66,768











Non-Interest Expense:










Operating expenses:










Compensation and benefits

73,182


75,705


75,159


228,338


229,172

Occupancy and equipment

23,960


21,177


21,748


63,011


66,599

General and administrative

31,366


26,711


26,395


86,273


89,350

Total non-interest expense

128,508


123,593


123,302


377,622


385,121

Income before income taxes

154,130


140,085


132,218


409,458


391,174

Income tax expense 

38,360


34,738


33,172


88,013


97,305

Net Income 

115,770


105,347


99,046


321,445


293,869

Preferred stock dividends

8,207


8,207


8,207


24,621


24,621

Net income available to common shareholders

$    107,563


$      97,140


$      90,839


$    296,824


$    269,248











Basic earnings per common share 

$          0.23


$          0.21


$          0.19


$          0.63


$          0.57

Diluted earnings per common share

$          0.23


$          0.21


$          0.19


$          0.63


$          0.57

 

NEW YORK COMMUNITY BANCORP, INC.
RECONCILIATIONS OF CERTAIN GAAP AND NON-GAAP FINANCIAL MEASURES
(unaudited)

While stockholders' equity, total assets, and book value per share are financial measures that are recorded in accordance with U.S. generally accepted accounting principles ("GAAP"), tangible stockholders' equity, tangible assets, and tangible book value per share are not.  Nevertheless, it is management's belief that these non-GAAP measures should be disclosed in our earnings releases and other investor communications for the following reasons:

  1. Tangible stockholders' equity is an important indication of the Company's ability to grow organically and through business combinations, as well as its ability to pay dividends and to engage in various capital management strategies.
  2. Returns on average tangible assets and average tangible stockholders' equity are among the profitability measures considered by current and prospective investors, both independent of, and in comparison with, the Company's peers.
  3. Tangible book value per share and the ratio of tangible stockholders' equity to tangible assets are among the capital measures considered by current and prospective investors, both independent of, and in comparison with, its peers. 

Tangible stockholders' equity, tangible assets, and the related non-GAAP profitability and capital measures should not be considered in isolation or as a substitute for stockholders' equity, total assets, or any other profitability or capital measure calculated in accordance with GAAP.  Moreover, the manner in which we calculate these non-GAAP measures may differ from that of other companies reporting non-GAAP measures with similar names. 

The following table presents reconciliations of our common stockholders' equity and tangible common stockholders' equity, our total assets and tangible assets, and the related GAAP and non-GAAP profitability and capital measures at or for the periods indicated: 


At or for the


At or for the




Three Months Ended




Nine Months Ended


September 30,


June 30,


September 30,


September 30,


September 30,

(dollars in thousands)

2020


2020


2019


2020


2019

Total Shareholders' Equity

$   6,734,730


$   6,693,013


$   6,695,007


$   6,734,730


$   6,695,007

Less: Goodwill

(2,426,379)


(2,426,379)


(2,426,379)


(2,426,379)


(2,426,379)

  Preferred stock

(502,840)


(502,840)


(502,840)


(502,840)


(502,840)

Tangible common shareholders' equity

$   3,805,511


$   3,763,794


$   3,765,788


$   3,805,511


$   3,765,788











Total Assets 

$ 54,931,755


$ 54,210,416


$ 52,537,629


$ 54,931,755


$ 52,537,629

Less: Goodwill

(2,426,379)


(2,426,379)


(2,426,379)


(2,426,379)


(2,426,379)

Tangible assets

$ 52,505,376


$ 51,784,037


$ 50,111,250


$ 52,505,376


$ 50,111,250











Average Common Shareholders' Equity

$   6,219,783


$   6,153,861


$   6,201,970


$   6,187,344


$   6,152,253

Less: Average goodwill 

(2,426,379)


(2,426,379)


(2,426,379)


(2,426,379)


(2,429,487)

Average tangible common shareholders' equity

$   3,793,404


$   3,727,482


$   3,775,591


$   3,760,965


$   3,722,766











Average Assets

$ 54,269,399


$ 53,787,221


$ 52,257,718


$ 53,823,341


$ 51,984,879

Less: Average goodwill 

(2,426,379)


(2,426,379)


(2,426,379)


(2,426,379)


(2,429,487)

Average tangible assets

$ 51,843,020


$ 51,360,842


$ 49,831,339


$ 51,396,962


$ 49,555,392











Net Income Available to Common Shareholders 

$      107,563


$      97,140


$        90,839


$      296,824


$      269,248











GAAP MEASURES:










Return on average assets (1)

0.85


0.78


0.76

%

0.80

%

0.75

Return on average common shareholders' equity (2)

6.92


6.31


5.86


6.40


5.84

Book value per common share

$          13.43


$          13.34


$          13.25


$          13.43


$          13.25

Common shareholders' equity to total assets

11.34


11.42


11.79


11.34


11.79











NON-GAAP MEASURES:










Return on average tangible assets (1)

0.89


0.82


0.80

%

0.83

%

0.79

Return on average tangible common shareholders' equity (2) 

11.34


10.42


9.62


10.52


9.64

Tangible book value per common share

$            8.20


$            8.11


$            8.06


$            8.20


$            8.06

Tangible common shareholders' equity to tangible assets

7.25


7.27


7.51


7.25


7.51



(1)

To calculate return on average assets for a period, we divide net income generated during that period by average assets recorded during that period. To calculate return on average tangible assets for a period, we divide net income by average tangible assets recorded during that period.

(2)

To calculate return on average common stockholders' equity for a period, we divide net income available to common shareholders generated during that period by average common stockholders' equity recorded during that period. To calculate return on average tangible common stockholders' equity for a period, we divide net income available to common shareholders generated during that period by average tangible common stockholders' equity recorded during that period.

 

NEW YORK COMMUNITY BANCORP, INC.


NET INTEREST INCOME ANALYSIS


LINKED-QUARTER AND YEAR-OVER-YEAR COMPARISONS


(unaudited)






















For the Three Months Ended



September 30, 2020


June 30, 2020


September 30, 2019



Average

Balance


Interest


Average
Yield/Cost


Average
Balance


Interest


Average
Yield/Cost


Average
Balance


Interest


Average
Yield/Cost


(dollars in thousands)



















Assets:



















Interest-earning assets:



















Mortgage and other loans and leases, net 

$ 42,302,113


$  380,337


3.60

%

$ 41,852,839


$  381,884


3.65

%

$   40,756,495


$  391,920


3.84

%

Securities

5,747,423


37,398


2.60


5,920,536


40,973


2.77


6,324,588


59,785


3.78


Interest-earning cash and cash equivalents

1,224,114


314


0.10


856,238


218


0.10


511,730


2,846


2.21


Total interest-earning assets

49,273,650


418,049


3.39


48,629,613


423,075


3.48


47,592,813


454,551


3.82


Non-interest-earning assets

4,995,749






5,157,608






4,664,905






Total assets

$ 54,269,399






$ 53,787,221






$   52,257,718






Liabilities and Stockholders' Equity:



















Interest-bearing deposits:



















Interest-bearing checking and money



















market accounts

$ 11,231,509


$      9,328


0.33

%

$ 10,540,243


$    10,059


0.38

%

$   10,263,331


$    42,465


1.64

%

Savings accounts

$5,755,035


7,593


0.52


$5,336,234


8,208


0.62


4,747,843


9,326


0.78


Certificates of deposit

11,654,094


44,481


1.52


13,134,732


65,233


2.00


14,093,146


86,934


2.45


Total interest-bearing deposits

28,640,638


61,402


0.85


29,011,209


83,500


1.16


29,104,320


138,725


1.89


Borrowed funds

15,138,875


74,761


1.97


14,402,886


73,703


2.06


13,325,104


79,911


2.38


Total interest-bearing liabilities

43,779,513


136,163


1.24


43,414,095


157,203


1.46


42,429,424


218,636


2.04


Non-interest-bearing deposits

2,992,018






3,040,046






2,491,796






Other liabilities

775,245






676,379






631,688






Total liabilities

47,546,776






47,130,520






45,552,908






Stockholders' equity

6,722,623






6,656,701






6,704,810






Total liabilities and shareholders' equity

$ 54,269,399






$ 53,787,221






$   52,257,718






Net interest income/interest rate spread



$  281,886


2.15

%



$  265,872


2.02

%



$  235,915


1.78

%

Net interest margin





2.29

%





2.18

%





1.99

%

Ratio of interest-earning assets to



















interest-bearing liabilities 





1.13

x





1.12

x





1.12

x

 

NEW YORK COMMUNITY BANCORP, INC.


NET INTEREST INCOME ANALYSIS


YEAR-OVER-YEAR COMPARISON


(unaudited)
















For the Nine Months Ended September 30,



2020


2019



Average

Balance


Interest


Average
Yield/Cost


Average
Balance


Interest


Average
Yield/Cost


(dollars in thousands)













Assets:













Interest-earning assets:













Mortgage and other loans, net 

$ 41,890,218


$ 1,154,133


3.67

%

$ 40,288,311


$ 1,159,344


3.84

%

Securities

6,004,152


125,647


2.79


6,303,147


181,162


3.83


Interest-earning cash and cash equivalents

915,547


2,386


0.35


789,034


13,971


2.37


Total interest-earning assets

48,809,917


1,282,166


3.50


47,380,492


1,354,477


3.81


Non-interest-earning assets

5,013,424






4,604,387






Total assets

$ 53,823,341






$ 51,984,879






Liabilities and Shareholders' Equity:













Interest-bearing deposits:













Interest-bearing checking and money













market accounts

$ 10,616,205


$      47,951


0.60

%

$ 10,846,624


$    140,396


1.73

%

Savings accounts

5,309,920


24,735


0.62


4,716,014


26,270


0.74


Certificates of deposit

12,964,968


189,270


1.95


13,306,845


235,360


2.36


Total interest-bearing deposits

28,891,093


261,956


1.21


28,869,483


402,026


1.86


Borrowed funds

14,662,103


227,985


2.08


13,308,941


237,521


2.39


Total interest-bearing liabilities

43,553,196


489,941


1.50


42,178,424


639,547


2.03


Non-interest-bearing deposits

2,867,587






2,555,984






Other liabilities

712,374






595,378






Total liabilities

47,133,157






45,329,786






Shareholders' equity

6,690,184






6,655,093






Total liabilities and shareholders' equity

$ 53,823,341






$ 51,984,879






Net interest income/interest rate spread



$    792,225


2.00

%



$    714,930


1.78

%

Net interest margin





2.16

%





2.01

%

Ratio of interest-earning assets to













interest-bearing liabilities 





1.12

x





1.12

x

 

NEW YORK COMMUNITY BANCORP, INC.


CONSOLIDATED FINANCIAL HIGHLIGHTS


(unaudited)














For the Three Months Ended


For the Nine Months Ended



September 30,


June 30,


September 30,


September 30,


September 30,


(dollars in thousands except share and per share data)

2020


2020


2019


2020


2019


PROFITABILITY MEASURES:











Net income

$      115,770


$      105,347


$        99,046


$      321,445


$      293,869


Net income available to common shareholders

107,563


97,140


90,839


296,824


269,248


Basic earnings per common share 

0.23


0.21


0.19


0.63


0.57


Diluted earnings per common share 

0.23


0.21


0.19


0.63


0.57


Return on average assets

0.85

%

0.78

%

0.76

%

0.80

%

0.75

%

Return on average tangible assets (1)

0.89


0.82


0.80


0.83


0.79


Return on average common shareholders' equity

6.92


6.31


5.86


6.40


5.84


Return on average tangible common shareholders'











equity (1)

11.34


10.42


9.62


10.52


9.64


Efficiency ratio (2)

43.47


43.94


47.37


45.05


49.27


Operating expenses to average assets

0.95


0.92


0.94


0.94


0.99


Interest rate spread

2.15


2.02


1.78


2.00


1.78


Net interest margin

2.29


2.18


1.99


2.16


2.01


Effective tax rate

24.89


24.80


25.09


21.50


24.88


Shares used for basic common EPS computation

461,780,959


461,933,533


465,357,326


462,898,726


465,400,372


Shares used for diluted common EPS computation

462,645,814


462,489,493


465,776,000


463,512,808


465,638,080


Common shares outstanding at the respective











period-ends

463,904,084


463,933,831


467,350,860


463,904,084


467,350,860













(1)  See the reconciliations of these non-GAAP measures with the comparable GAAP measures on page 9 of this release.







(2)  We calculate our efficiency ratio by dividing our operating expenses by the sum of our net interest income and non-interest income.


 


September 30,


June 30,


September 30,




2020


2020


2019



CAPITAL MEASURES:








Book value per common share

$      13.43


$      13.34


$      13.25



Tangible book value per common share (1)

8.20


8.11


8.06



Common shareholders' equity to total assets

11.34

%

11.42

%

11.79

%


Tangible common shareholders' equity to tangible assets (1)

7.25


7.27


7.51











(1)  See the reconciliations of these non-GAAP measures with the comparable GAAP measures on page 9 of this release.



 

NEW YORK COMMUNITY BANCORP, INC.




SUPPLEMENTAL FINANCIAL INFORMATION


September 30, 2020








compared to


September 30,


June 30,


September 30,


June 30,

September 30,


2020


2020


2019


2020

2019


(unaudited)


(unaudited)


(unaudited)




(in thousands, except share data)









Assets









Cash and cash equivalents

$   1,458,641


$   1,404,527


$      854,678


4%

71%

Securities:









Available-for-sale

5,233,744


5,168,182


5,854,568


1%

-11%

    Equity investments with readily









        determinable fair values, at fair value

31,448


33,518


32,861


-6%

-4%

Total securities

5,265,192


5,201,700


5,887,429


1%

-11%

Loans held for sale

117,272


103,362


-


13%

N/A

Mortgage loans held for investment:









Multi-family

32,124,324


31,620,152


30,289,364


2%

6%

Commercial real estate 

6,887,918


6,932,776


6,988,226


-1%

-1%

One-to-four family

274,387


321,045


395,347


-15%

-31%

Acquisition, development, and construction

85,902


126,305


297,565


-32%

-71%

Total mortgage loans held for investment

39,372,531


39,000,278


37,970,502


1%

4%

Other loans and leases held for investment: 









Specialty Finance

3,055,896


2,918,296


2,416,941


5%

26%

Commercial and industrial 

394,305


380,862


448,003


4%

-12%

Other loans

6,487


6,751


8,774


-4%

-26%

Total other loans and leases  held for investment

3,456,688


3,305,909


2,873,718


5%

20%

Total loans and leases held for investment

42,829,219


42,306,187


40,844,220


1%

5%

Less:  Allowance for loan and lease losses

(188,307)


(174,287)


(149,433)


8%

26%

Total loans and leases, net

42,758,184


42,235,262


40,694,787


1%

5%

Federal Home Loan Bank stock, at cost

697,483


668,698


606,371


4%

15%

Premises and equipment, net

289,788


297,180


321,792


-2%

-10%

Operating lease right-of-use assets

271,515


278,276


300,955


-2%

-10%

Goodwill

2,426,379


2,426,379


2,426,379


0%

0%

Other assets 

1,764,573


1,698,394


1,445,238


4%

22%

Total assets

$ 54,931,755


$ 54,210,416


$ 52,537,629


1%

5%

Liabilities and Shareholders' Equity









Deposits:









Interest-bearing checking and money market accounts

$ 11,693,982


$ 11,141,163


$   9,960,403


5%

17%

Savings accounts

5,964,981


5,624,999


4,817,697


6%

24%

Certificates of deposit

10,990,080


12,042,254


14,264,171


-9%

-23%

Non-interest-bearing accounts

3,055,898


2,921,165


2,529,905


5%

21%

Total deposits

31,704,941


31,729,581


31,572,176


0%

0%

Borrowed funds:









Wholesale borrowings

15,027,661


14,352,661


12,971,661


5%

16%

Junior subordinated debentures

360,157


360,058


359,773


0%

0%

Subordinated notes

295,485


295,345


294,926


0%

0%

Total borrowed funds

15,683,303


15,008,064


13,626,360


4%

15%

Operating lease liabilities

271,499


278,272


300,610


-2%

-10%

Other liabilities

537,282


501,486


343,476


7%

56%

Total liabilities

48,197,025


47,517,403


45,842,622


1%

5%

Shareholders' equity:









Preferred stock at par $0.01 (5,000,000 shares authorized): 









Series A (515,000 shares issued and outstanding)

502,840


502,840


502,840


0%

0%

Common stock at par $0.01 (900,000,000 shares authorized; 490,439,070; 490,439,070;









and 490,439,070 shares issued; and 463,904,084; 463,933,831; and 467,350,860

4,904


4,904


4,904


0%

0%

shares outstanding, respectively)









Paid-in capital in excess of par

6,117,902


6,109,597


6,107,376


0%

0%

Retained earnings 

391,528


362,724


328,407


8%

19%

Treasury stock, at cost (26,534,986; 26,505,239 and 23,088,210 shares, respectively)

(257,521)


(257,232)


(220,669)


0%

17%

Accumulated other comprehensive loss, net of tax:









Net unrealized gain on securities available for sale, net of tax

67,755


66,548


37,762


2%

79%

Pension and post-retirement obligations, net of tax

(55,137)


(56,470)


(65,613)


-2%

-16%

Net unrealized (loss) gain on cash flow hedges, net of tax

(37,541)


(39,898)


-


-6%

N/A

Total accumulated other comprehensive loss, net of tax

(24,923)


(29,820)


(27,851)


-16%

-11%

Total shareholders' equity

6,734,730


6,693,013


6,695,007


1%

1%

Total liabilities and shareholders' equity

$ 54,931,755


$ 54,210,416


$ 52,537,629


1%

5%

 

NEW YORK COMMUNITY BANCORP, INC.

SUPPLEMENTAL FINANCIAL INFORMATION (continued)

(unaudited)
















September 30, 2020


For the Three Months Ended


compared to


September 30,


June 30,


September 30,


June 30,

September 30,


2020


2020


2019


2020

2019










(in thousands, except per share data)









Interest Income:









Loans and leases

$    380,337


$ 381,884


$ 391,920


0%

-3%

Securities and money market investments

37,712


41,191


62,631


-8%

-40%

Total interest income

418,049


423,075


454,551


-1%

-8%










Interest Expense:









Interest-bearing checking and money market accounts

9,328


10,059


42,465


-7%

-78%

Savings accounts 

7,593


8,208


9,326


-7%

-19%

Certificates of deposit

44,481


65,233


86,934


-32%

-49%

Borrowed funds

74,761


73,703


79,911


1%

-6%

Total interest expense

136,163


157,203


218,636


-13%

-38%

Net interest income

281,886


265,872


235,915


6%

19%

Provision for credit losses

13,016


17,574


4,781


-26%

172%

Net interest income after provision for credit losses

268,870


248,298


231,134


8%

16%










Non-Interest Income:









Fee income

5,240


3,723


7,580


41%

-31%

Bank-owned life insurance

7,566


9,503


6,791


-20%

11%

Net (losses) gains on securities 

(284)


887


275


-132%

-203%

Other income 

1,246


1,267


9,740


-2%

-87%

Total non-interest income  

13,768


15,380


24,386


-10%

-44%










Non-Interest Expense:









Operating expenses:









Compensation and benefits

73,182


75,705


75,159


-3%

-3%

Occupancy and equipment

23,960


21,177


21,748


13%

10%

General and administrative

31,366


26,711


26,395


17%

19%

Total non-interest expense

128,508


123,593


123,302


4%

4%

Income before income taxes

154,130


140,085


132,218


10%

17%

Income tax expense 

38,360


34,738


33,172


10%

16%

Net Income 

115,770


105,347


99,046


10%

17%

Preferred stock dividends

8,207


8,207


8,207


0%

0%

Net income available to common shareholders

$    107,563


$   97,140


$   90,839


11%

18%










Basic earnings per common share 

$          0.23


$       0.21


$       0.19


10%

21%

Diluted earnings per common share

$          0.23


$       0.21


$       0.19


10%

21%

Dividends per common share

$          0.17


$       0.17


$       0.17


0%

0%

 

NEW YORK COMMUNITY BANCORP, INC.
SUPPLEMENTAL FINANCIAL INFORMATION (continued)

The following tables summarize the contribution of loan and securities prepayment income on the Company's interest income and net interest margin for the periods indicated.


For the Three Months Ended


September 30, 2020 compared to



September 30,


June 30,


September 30,


June 30,


September 30,



2020


2020


2019


2020


2019


(dollars in thousands)






















Total Interest Income

$418,049


$423,075


$454,551


-1%


-8%













Prepayment Income:











     Loans

$11,279


$11,098


$12,279


2%


-8%


     Securities

355


314


1,866


13%


-81%


Total prepayment income

$11,634


$11,412


$14,145


2%


-18%













GAAP Net Interest Margin

2.29%


2.18%


1.99%


11

bp

30

bp

     Less:











     Prepayment income from loans

9

bp

9

bp

10

bp

0

bp

-1

bp

     Prepayment income from securities

-


-


1


0

bp

-1

bp

Total prepayment income contribution 











to net interest margin

9

bp

9

bp

11

bp

0

bp

-2

bp












Adjusted Net Interest Margin (non-GAAP)

2.20%


2.09%


1.88%


11

bp

32

bp



































For the Nine Months Ended









September 30,


September 30,









2020


2019


Change (%)






(dollars in thousands)






















Total Interest Income

$1,282,166


$1,354,477


-5%

















Prepayment Income:











     Loans

$32,566


$33,462


-3%






     Securities

1,017


2,873


-65%






Total prepayment income

$33,583


$36,335


-8%

















GAAP Net Interest Margin

2.16%


2.01%


15

bp





     Less:











     Prepayment income from loans

6

bp

10

bp

-4

bp





     Prepayment income from securities

1


-


1

bp





Total prepayment income contribution











to net interest margin

7

bp

10

bp

-3

bp
















Adjusted Net Interest Margin (non-GAAP)

2.09%


1.91%


18

bp





 

While our net interest margin, including the contribution of prepayment income is recorded in accordance with GAAP, adjusted net interest margin, which excludes the contribution of prepayment income is not.  Nevertheless, management uses this non-GAAP measure in its analysis of our performance, and believes that this non-GAAP measure should be disclosed in our earnings releases and other investor communications for the following reasons:

  1. Adjusted net interest margin gives investors a better understanding of the effect of prepayment income and other items on our net interest margin. Prepayment income in any given period depends on the volume of loans that refinance or prepay, or securities that prepay, during that period. Such activity is largely dependent on external factors such as current market conditions, including real estate values, and the perceived or actual direction of market interest rates.
  2. Adjusted net interest margin is among the measures considered by current and prospective investors, both independent of, and in comparison with, our peers.

 

NEW YORK COMMUNITY BANCORP, INC.

SUPPLEMENTAL FINANCIAL INFORMATION (continued)




LOANS ORIGINATED FOR INVESTMENT


(unaudited)









September 30, 2020



For the Three Months Ended


compared to



September 30,


June 30,


September 30,


June 30,


September 30,



2020


2020


2019


2020


2019


(in thousands)











Mortgage Loans Originated for Investment:











     Multi-family

$2,104,809


$2,413,257


$1,180,054


-13%


78%


     Commercial real estate

169,536


89,975


309,314


88%


-45%


     One-to-four family residential

-


18,090


20,745


-100%


NM


     Acquisition, development, and construction

19,309


535


36,961


3509%


-48%


Total mortgage loans originated for investment

2,293,654


2,521,857


1,547,074


-9%


48%













Other Loans Originated for Investment:











     Specialty Finance

589,970


700,010


637,843


-16%


-8%


     Other commercial and industrial

93,023


57,177


93,905


63%


-1%


     Other

845


826


1,343


2%


-37%


Total other loans originated for investment

683,838


758,013


733,091


-10%


-7%


Total Loans Originated for Investment

$2,977,492


$3,279,870


$2,280,165


-9%


31%




































For the Nine Months Ended









September 30,


September 30,









2020


2019


Change (%)






(in thousands)











Mortgage Loans Originated for Investment:











     Multi-family

$5,935,285


$3,990,064


49%






     Commercial real estate

451,162


899,438


-50%






     One-to-four family residential

45,286


25,508


78%






     Acquisition, development, and construction

24,752


58,227


-57%






Total mortgage loans originated for investment

6,456,485


4,973,237


30%

















Other Loans Originated for Investment:











     Specialty Finance

2,247,373


2,000,799


12%






     Other commercial and industrial

272,586


303,030


-10%






     Other

2,596


3,493


-26%






Total other loans originated for investment

2,522,555


2,307,322


9%






Total Loans Originated for Investment

$8,979,040


$7,280,559


23%




























The following table provides certain information about the Company's multi-family and CRE loan portfolios at the




respective dates:


















September 30, 2020



At or For the Three Months Ended


compared to



September 30,


June 30,


September 30,


June 30,


September 30,



2020


2020


2019


2020


2019


(dollars in thousands)











Multi-Family Loan Portfolio:











     Loans outstanding

32,124,324


$31,620,152


$30,289,364


2%


6%


Percent of total held-for-investment loans

75.0%


74.7%


74.2%


26

bp

81

bp

     Average principal balance

$6,569


$6,479


$6,162


1%


7%


     Weighted average life (in years)

2.0


1.9


2.1


5%


-5%













Commercial Real Estate Loan Portfolio:











     Loans outstanding

6,887,918


$6,932,776


$6,988,226


-1%


-1%


     Percent of total held-for-investment loans

16.1%


16.4%


17.1%


-30

bp

-102

bp

     Average principal balance

$6,653


$6,677


$6,399


0%


4%


     Weighted average life (in years)

2.3


2.3


2.4


0%


-4%


 

NEW YORK COMMUNITY BANCORP, INC.

SUPPLEMENTAL FINANCIAL INFORMATION (continued)


ASSET QUALITY SUMMARY

(unaudited)











The following table presents the Company's non-performing loans and assets at the respective dates:


















September 30, 2020








compared to


September 30,


June 30,


September 30,


June 30,


September 30,

(in thousands)

2020


2020


2019


2020


2019

Non-Performing Assets:










Non-accrual mortgage loans:










     Multi-family

$4,068


$6,316


$5,793


-36%


-30%

     Commercial real estate

12,673


16,183


5,563


-22%


128%

     One-to-four family residential

1,706


1,716


2,040


-1%


-16%

     Acquisition, development, and construction

-


-


-


NM


NM

Total non-accrual mortgage loans

18,447


24,215


13,396


-24%


38%

Other non-accrual loans (1)

26,904


29,456


42,797


-9%


-37%

Total non-performing loans

45,351


53,671


56,193


-16%


-19%

Repossessed assets (2)

9,526


9,526


11,691


0%


-19%

Total non-performing assets

$54,877


$63,197


$67,884


-13%


-19%











(1) Includes $24.4 million, $26.0 million and $33.6 million of non-accrual taxi medallion-related loans at September 30, 2020





June 30, 2020 and September 30, 2019, respectively.










(2) Includes $7.6 million, $7.6 million and $9.7 million of repossessed taxi medallions at September 30, 2020, June 30, 2020 and September 30, 2019



respectively.








































The following table presents the Company's asset quality measures at the respective dates:
















September 30,


June 30,


September 30,






2020


2020


2019















Non-performing loans to total loans

0.11

%

0.13

%

0.14

%














Non-performing assets to total assets

0.10


0.12


0.13















Allowance for losses on loans to non-performing loans

415.22


324.73


265.93















Allowance for losses on loans to total loans

0.44


0.41


0.37





 

NEW YORK COMMUNITY BANCORP, INC.

SUPPLEMENTAL FINANCIAL INFORMATION (continued)


The following table presents the Company's loans 30 to 89 days past due at the respective dates:


















September 30, 2020








compared to


September 30,


June 30,


September 30,


June 30,


September 30,


2020


2020


2019


2020


2019

(in thousands)










Loans 30 to 89 Days Past Due:










     Multi-family

$                  378


$             383


$                       -


-1%


NM

     Commercial real estate

2,617


326


9,750


703%


NM

     One-to-four family residential

2,078


1,361


-


53%


NM

     Acquisition, development, and construction

-


-


-


NM


NM

     Other (1)

56


65


489


-14%


-89%

Total loans 30 to 89 days past due

$               5,129


$          2,135


$             10,239


140%


-50%











(1) Includes $0, $0 and $483,000 of taxi medallion loans at September 30, 2020

June 30, 2020 and September 30, 2019, respectively.





















The following table summarizes the Company's net charge-offs (recoveries) for the respective periods:












For the Three Months Ended


For the Nine Months Ended


September 30,


June 30,


September 30,


September 30,


September 30,


2020


2020


2019


2020


2019

(dollars in thousands)










Charge-offs:










     Multi-family

$                       -


$                  -


$                  437


$                       -


$                  437

     Commercial real estate

-


-


-


-


-

     One-to-four family residential

2


-


949


2


949

     Acquisition, development, and







-



   construction

-


-


-


-


-

     Other (1)

1,075


3,938


5,180


15,398


15,010

Total charge-offs

1,077


3,938


6,566


15,400


16,396











Recoveries:










     Multi-family

$                       -


$                  -


$                       -


$                       -


$                       -

     Commercial real estate

(755)


-


-


(755)


-

     One-to-four family residential

-


-


-


-


-

     Acquisition, development, and







-



   construction

(2)


(49)


(21)


(62)


(43)

     Other (1)

(1,221)


(105)


(84)


(1,504)


(562)

Total recoveries

(1,978)


(154)


(105)


(2,321)


(605)











Net charge-offs 

$                 (901)


$          3,784


$               6,461


$             13,079


$             15,791





















Net charge-offs to average loans (2)

0.00%


0.01%


0.02%


0.03%


0.04%











(1) Includes taxi medallion loans of $(1.2) million, $3.0 million, and $2.7 million, respectively,

 for the three months ended September 30, 2020, June 30, 2020, and September 30, 2019 and

 $8.6 million and $6.8 million, respectively, for the nine months ended September 30, 2020 and 2019.

(2) Three and nine months ended presented on a non-annualized basis.

 

Investor/Media Contact:
Salvatore J. DiMartino
(516) 683-4286

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SOURCE New York Community Bancorp, Inc.