New York Community Bank (NYCB.US) credit rating downgraded, Fitch holds negative outlook on risk position

Credit rating agency Fitch has downgraded the credit rating of New York Community Bank (NYCB.US) and its subsidiary Flagstar Bank from "BBB-"/"F3" to "BB+"/"B". Previously, Fitch had already downgraded New York Community Bank's long-term issuer default rating from "BBB" to "BBB-" in February. Fitch stated that the downgrade decision was based on a reassessment of the risk profile of New York Community Bank, following the announcement of significant internal control deficiencies within the company, particularly related to internal loan reviews. The agency also added that the outlook for the bank's rating is negative. In addition, several companies including Morningstar DBRS have downgraded this struggling loan institution due to its "excessive" exposure to commercial real estate (CRE). Moody's has also downgraded their ratings. Fitch stated that the appointment of Alessandro Dinello as CEO on Thursday was viewed positively, given his previous role as CEO of Flagstar Bancorp.