A couple of months ago, we shared a bearish thesis on New York Community Bancorp (NYCB). Following the publication, we received many questions on the stock from SA readers. First off, it seems that there is a big misconception that NYCB should benefit from higher interest rates. As the table below shows, contrary to popular belief, higher interest rates are a headwind for NYCB’s net interest income.
Source: NYCB 10-Q
NYCB has recently reported its financial results for the fourth quarter. While the numbers were broadly in line with expectations, we are turning even more bearish on the stock.
