This summary highlights selected information contained elsewhere in this proxy statement. This summary does not contain all of the information you should consider, and you should read the entire proxy statement carefully before voting. For more complete information regarding the 2023 performance of New York Community Bancorp, Inc. (the “Company” or “NYCB”), please review our 2023 Annual Report on Form 10-K/A, which accompanies this proxy statement and can be found here: https://ir.mynycb.com/files/doc_financials/2023/q4/12-31-2023-10-K.pdf
VOTING MATTERS:
| PROPOSAL | RECOMMENDATIONOF THE BOARD: | |
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| Proposal 1 The election of three directors to three-year terms. | | FOR ALL |
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| Proposal 2 Ratification of the appointment of KPMG LLP as our independent registered public accounting firm for 2024. | | FOR |
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| Proposal 3 Approval, on a non-binding advisory basis, of the Company’s Named Executive Officer compensation. | | FOR |
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| Proposal 4 A proposal to amend the Amended and Restated Certificate of Incorporation of the Company (the “COI”) to increase (a) the total number of shares of stock of all classes that the Company has authority to issue from 905,000,000 to 2,005,000,000 and (b) the number of authorized shares of common stock, par value $0.01 per share, of the Company (“Common Stock”) from 900,000,000 to 2,000,000,000. | | FOR |
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| Proposal 5 A proposal to amend the COI to effect a reverse stock split of the Common Stock by a ratio of 1-3, with such action to be effected at such time and date as determined by the Board of Directors of the Company within one year after the conclusion of the 2024 Annual Meeting of Shareholders of the Company, and a corresponding reduction in the total number of shares of Common Stock that the Company is authorized to issue under the COI. | | FOR |
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| Proposal 6 A proposal to waive the application of Article Fourth, Section C, Clauses 1 and 4 of the COI with respect to affiliates of funds managed by Liberty 77 Capital L.P. (the “Liberty Investors”) and affiliates of funds managed by Reverence Capital Partners, L.P. (the “Reverence Investors”), but not any other shareholders of the Company, which provision prohibits any person who beneficially owns, directly or indirectly, more than 10% of the then-outstanding shares of Common Stock from voting any such shares in excess of such 10% threshold. | | FOR |
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| Proposal 7 A proposal to approve the issuance of shares of Common Stock in connection with the March 2024 capital raise pursuant to New York Stock Exchange (“NYSE”) listing rules. | | FOR |
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| Proposal 8 A proposal to amend the New York Community Bancorp, Inc. 2020 Omnibus Incentive Plan. |
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| Proposal 9 A proposal to amend the COI and Bylaws of the Company to eliminate the supermajority voting requirements | | FOR |
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| Proposal 10 A shareholder proposal on Simple Majority Vote. | | AGAINST |
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| Proposal 11 An adjournment proposal, if necessary or appropriate, to solicit additional proxies if there are insufficient votes at the time of the Annual Meeting to approve Proposals 4, 6 and 7. | | FOR |
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| PROXY STATEMENT SUMMARY | ENVIRONMENTAL, SOCIAL & GOVERNANCE | SUMMARY OF THE MARCH 2024 CAPITAL RAISE | CORPORATE GOVERNANCE | EXECUTIVE COMPENSATION | STOCKHOLDER PROPOSALS | INFORMATION ABOUT OUR ANNUAL MEETING AND SOLICITATION OF PROXIES | ADDITIONAL INFORMATION |
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HIGHLIGHTS:
COMPANY PROFILE:
New York Community Bancorp, Inc. is the parent company of Flagstar Bank, N.A., one of the largest commercial banks in the country. The Company is headquartered in Hicksville, New York with regional headquarters in Troy, Michigan. At December 31, 2023, the Company had $114.1 billion of assets, $84.6 billion of loans, deposits of $81.5 billion, and total stockholders’ equity of $8.4 billion. Atyear-end 2023, Flagstar Bank, N.A. operated 420 branches across a nine-state footprint, including strongholds in the Northeast and the Midwest, along with exposure to high growth markets in the Southeast and on the West Coast. In addition, the Company has approximately 130 private banking teams located in over 10 cities, in the metropolitan New York City region and on the West Coast, which serve the needs of high net worth individuals and their businesses. In December 2022, the former New York Community Bank (“Legacy NYCB”), was merged with and into Flagstar Bank, N.A. Herein, the assets, liabilities, operations and personnel of Flagstar Bank, N.A., as they existed prior to the December 1, 2022 merger with Legacy NYCB, are referred to as “Legacy Flagstar,” and Legacy Flagstar, together with Legacy NYCB are referred to as “Flagstar Bank” or the “Bank.”
In March 2023, the Bank acquired and assumed certain assets and liabilities of Signature Bridge Bank, N.A., including all of legacy Signature Bank’s core deposit relationships, including both the New York and West Coast Private Client Banking teams, its wealth management and broker dealer business, and 40 branch locations, most of which are in the New York City metro area. Herein, the assets, liabilities, operations, and personnel acquired from Signature Bridge Bank, N.A. may be referred to as “Legacy Signature.” All Legacy Signature branches, together with all Legacy NYCB and Legacy Flagstar branches, have been rebranded as Flagstar Bank. The three Legacy institutions are referred to herein collectively as the “Legacy Organizations.”
EQUITY CAPITAL RAISE
On March 11, 2024, the Company announced the completion of a capital raise transaction (the “March 2024 capital raise”) resulting in individual investments aggregating to approximately $1.05 billion in the Company by (i) affiliates of funds managed by Liberty 77 Capital L.P. (the “Liberty Investors”), (ii) affiliates of funds managed by Hudson Bay Capital Management, LP (the “Hudson Bay Investors”), (iii) affiliates of funds managed by Reverence Capital Partners, L.P. (the “Reverence Investors”) and (iv) other investors.
This major equity raise is a significant component of the broad-based turnaround effort of the Company following disappointing fourth quarter 2023 financial results principally tied to Flagstar Bank’s commercial real estate lending business. The March 2024 capital raise and other changes adopted by the Company, including turnover within and reduction in the size of the Board of Directors (the “2024 Board Turnover”) and changes to the management team (including the CEO), is expected to allow the Company to better focus on executing its strategy, as it enters a new chapter of its long history, from a position of strength and repositioning itself as a regional bank. These changes are expected to allow the Company to enhance its capital position, proactively manage its liquidity profile, enhance its focus on credit risk management, continue to reduce its concentrations in commercial real estate, continue to build upon regulatory and compliance focus, and continue to strengthen its management team through a series of recent appointments. The new leadership team, with the support of the reconstituted Board, will continue to take actions that they deem advisable to execute upon and realize the opportunities provided by the March 2024 capital raise to improve earnings, profitability and drive enhanced value for shareholders.
In connection with the March 2024 capital raise, on or shortly after March 11, 2024, Thomas Cangemi, James Carpenter, Leslie Dunn, Lawrence Rosano Jr, Ronald Rosenfeld, Lawrence Savarese, David Treadwell and Robert Wann resigned as directors of the Board. Additionally, in February 2024, Toan C. Huynh and Hanif (Wally) Dahya
| PROXY STATEMENT SUMMARY | ENVIRONMENTAL, SOCIAL & GOVERNANCE | SUMMARY OF THE MARCH 2024 CAPITAL RAISE | CORPORATE GOVERNANCE | EXECUTIVE COMPENSATION | STOCKHOLDER PROPOSALS | INFORMATION ABOUT OUR ANNUAL MEETING AND SOLICITATION OF PROXIES | ADDITIONAL INFORMATION |
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resigned as directors of the Board. Four directors who were serving on the Board as of December 31, 2023 continue to serve on the Board: Alessandro P. DiNello, Marshall J. Lux, Peter Schoels, and Jennifer R. Whip. Additionally, in connection with the March 2024 capital raise, on or shortly after March 11, 2024, five new directors were appointed to the Board: Former Treasury Secretary Steven Mnuchin, Joseph Otting, Milton Berlinski, Allen Puwalski and Alan Frank.
EXECUTIVE MANAGEMENT TEAM
The Company has recently appointed seven new distinguished leaders to its executive management team. These strategic appointments signify the Company’s commitment to enhancing its operational capabilities, fortifying its risk and compliance framework, and driving sustainable growth. Joining the executive management team are:
| • | Joseph Otting, President, Chief Executive Officer – Joseph is an experienced executive and former government official who served as the 31st Comptroller of the Currency from November 2017 to 2020. He brings more than 20 years of banking experience. Prior to becoming Comptroller of the Currency, Joseph was an executive in the banking industry. He served as President of CIT Bank and Co-President of CIT Group Inc. from August 2015 to December 2015. Joseph previously was President, Chief Executive Officer, and a member of the board of directors of OneWest Bank, N.A. Prior to joining OneWest Bank, he served as Vice Chairman of U.S. Bancorp, where he managed the Commercial Banking Group and served on U.S. Bancorp’s Executive Management Committee. He also served as a member of U.S. Bank’s main subsidiary banks’ board of directors. |
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| • | Craig Gifford, SEVP, Chief Financial Officer – Craig brings more than 30 years of banking experience, most recently as EVP, Enterprise Operations with U.S. Bancorp where he led all physical operations, including the distribution strategy for the bank’s branch and ATM network. Previously, he served as U.S. Bancorp’s Corporate Controller, and prior to that, as Chief Accounting Officer and Corporate Controller for Guaranty Financial Group, following a 13-year career in the financial services group of Ernst & Young LLP. Craig brings proven experience in navigating challenging financial environments, including raising capital and delivering profitable results. |
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| • | Bao Nguyen, SEVP, General Counsel & Chief of Staff – Bao brings more than 15 years of experience as a financial services attorney. Most recently he served as a Partner for Skadden, Arps, Slate, Meagher & Flom LLP where he advised global and regional financial institutions, fintech and digital asset companies and private equity firms on the regulatory aspects of complex transactions, charters, compliance matters and enforcement issues. Prior to joining Skadden, he held senior positions with the Office of the Comptroller of the Currency (OCC), including as acting Chief Counsel and, most recently, as Principal Deputy Chief Counsel. During his time at the OCC, he oversaw significant policy decisions, rulemaking, transaction reviews and enforcement matters. Earlier in his career he served as Senior Counsel at the Board of Governors of the Federal Reserve System, and as a Banking Fellow in the U.S. Senate, negotiating key reforms to the U.S. regulatory framework as part of the Dodd-Frank Act. |
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| • | Scott Shepherd, SEVP, Head of Commercial Real Estate Lending – Scott is a senior executive with a more than 20-year track record building and leading teams in commercial real estate, creating value through lending, debt restructuring, workouts and acquisitions. Most recently, he served as Managing Director, The Ruth Group, a commercial real estate deal sponsor, and operator, where he focused on securing debt and equity financing to acquire value-add office and industrial conversion properties and complex restructurings. Prior to that he founded Archbell Capital, a commercial real estate bridge lender focused on institutional quality deal sponsors across property types. He also spent six years at OneWest Bank where he was the Head of the Commercial Real Estate Group. While there, he launched a CRE lending business that originated over $3.5 billion in loan commitments and led workouts of $2 billion of acquired loans. He started his real estate finance career at Goldman Sachs, where he was an investment banker for ten years. |
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| PROXY STATEMENT SUMMARY | ENVIRONMENTAL, SOCIAL & GOVERNANCE | SUMMARY OF THE MARCH 2024 CAPITAL RAISE | CORPORATE GOVERNANCE | EXECUTIVE COMPENSATION | STOCKHOLDER PROPOSALS | INFORMATION ABOUT OUR ANNUAL MEETING AND SOLICITATION OF PROXIES | ADDITIONAL INFORMATION |
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| • | George F. Buchanan III, EVP, Chief Risk Officer – George brings over 30 years of financial services-related risk management and credit experience. Prior to joining the Company, Mr. Buchanan spent 13 years at Regions Bank, where he held several roles of escalating responsibility, across various risk disciplines. Most recently, he served in Regions’ credit review area. Prior to that, he spent five years as Chief Risk Officer for Consumer Banking and Wealth Management, with responsibility for all aspects of risk management. Additionally, Mr. Buchanan led numerous areas within the credit division, including commercial, private wealth, small business, and business services. |
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| • | Colleen McCullum, EVP, Chief Audit Executive – Colleen brings over 20 years of bank experience. Prior to joining the Company, Ms. McCullum was Chief Audit Executive at United Community Bank, where she led the Internal Audit Department with responsibility for delivering all aspects of the audit plan, including overseeing the design, planning and execution of the plan. Ms. McCullum also served on the Operating Committee of the Bank. She also has considerable large bank experience, including time at Capital One, Bank of America, and Wells Fargo. Prior to United Community Bank, Ms. McCullum spent three years at Capital One, most recently serving as Senior Vice President and Head of Line-of-Business Audit. Prior to joining Capital One, she spent three years at Bank of America as Senior Vice President and General Auditor responsible for overseeing the risk and compliance audit coverage. Previously, she spent 15 years at Wells Fargo, where she held a variety of risk positions with escalating responsibility, including the role of Chief Risk Officer of the European, Middle East and African (EMEA) region and the Head of Counterparty Credit Risk. |
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| • | James Simons, EVP, Special Advisor to the CEO – In this newly created role, James will advise on credit administration, portfolio management and lending projects. He brings more than 45 years of banking experience, the last 20 of those serving as Senior Credit Executive/Chief Credit Officer for First Citizens Bank (formerly OneWest Bank and CIT Bank), Associated Bank, Guaranty Bancorp, and U.S. Bancorp. In these positions, he was responsible for a variety of credit functions, problem loan management and served as the primary business line approver for commercial real estate, middle market lending, builder finance, private banking, and asset-based lending. He also brings considerable bank turn-around and loan workout experience, as well as bank regulator experience with the OCC and Resolution Trust Corporation. |
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For further details on our current executive officers, please refer to the section entitled“Information with respect to Nominees, Continuing Directors and Executive Officers”.
| PROXY STATEMENT SUMMARY | ENVIRONMENTAL, SOCIAL & GOVERNANCE | SUMMARY OF THE MARCH 2024 CAPITAL RAISE | CORPORATE GOVERNANCE | EXECUTIVE COMPENSATION | STOCKHOLDER PROPOSALS | INFORMATION ABOUT OUR ANNUAL MEETING AND SOLICITATION OF PROXIES | ADDITIONAL INFORMATION |
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2023 PERFORMANCE:
In 2023, the Company reported net loss available to common shareholders of $112 million, or diluted loss per common share of $0.16. This represents a return on average assets of-0.07% and a return on average tangible assets of 0.57%, as well as a return on average common equity of-1.11% and a return on average tangible common equity of 8.17%.
| 1 | Return on average tangible assets and return on tangible common equity are non-GAAP financial measures. Please see Appendix A for a reconciliation of these non-GAAP measures. |
| • | From 1993 through the end of 2023, we recorded a mere 135 basis points of losses (cumulative charge-offs as a percent of average loans), in contrast to an industry average of 2,477 basis points during the same time. |
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| • | From 1993 through 2023, our average efficiency ratio was 41%, in contrast to the 60.12% industry average (as reported by S&P Global Market Intelligence). |
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| PROXY STATEMENT SUMMARY | ENVIRONMENTAL, SOCIAL & GOVERNANCE | SUMMARY OF THE MARCH 2024 CAPITAL RAISE | CORPORATE GOVERNANCE | EXECUTIVE COMPENSATION | STOCKHOLDER PROPOSALS | INFORMATION ABOUT OUR ANNUAL MEETING AND SOLICITATION OF PROXIES | ADDITIONAL INFORMATION |
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| • | Over the course of our public life, we have expanded our balance sheet by $99.5 billion through 12 mergers and acquisitions, involving nine in-market competitors and three out-of-market banks. |
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| • | On March 11, 2024, the Company announced the completion of the March 2024 capital raise as a first, and crucial step, in our effort to rebuild our capital base. Relatedly, we have made substantial changes to the Board to oversee these efforts. |
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EXECUTIVE COMPENSATION HIGHLIGHTS
| • | The composition of our Compensation Committee changed as a result of the turnover of our Board membership in connection with our March 2024 capital raise transaction. The new Compensation Committee made all determinations regarding the results of the 2023 short-term incentive program and the settlement of performance awards for the 2021-2023 performance period. |
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| • | Our short-term incentive program did not fund so our named executive officers did not receive a 2023 annual incentive award. The Company failed to achieve threshold requirements for the designated financial metric and for the critical Company objectives included in the strategic/qualitative scorecard. |
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| • | In March 2023, our named executive officers received awards at target under our 2023 long-term incentive program (“LTIP”). The target level represented a specified percentage of base salary for each executive. The award included a performance-based component covering the 2023-2025 performance period (65% of the target award) and a restricted stock award (35% of the target award) vesting over three years. The actual award, if any, under the performance-based component will be determined in the first quarter of 2026. Our former CEO, Mr. Cangemi, forfeited his 2023 LTIP award upon his resignation in February 2024. |
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| • | With one exception that reflected a specific business rationale, the base salary levels for our named executive officers were maintained at 2022 levels, reflecting the Compensation Committee’s assessment of positioning relative to market practice and our peers. |
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| • | Long-term incentive awards for the 2021-2023 period did not fund as a result of Company performance below the threshold level of performance for the designated financial metrics. |
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| • | We adopted a robust clawback policy under NYSE rules to provide that the Company can recover incentive compensation erroneously paid on the basis of misstated financial results. |
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GOVERNANCE HIGHLIGHTS
We are committed to maintaining the highest standards of corporate governance. Strong corporate governance practices will help us achieve our performance goals and maintain the trust and confidence of our shareholders and other constituents. In connection with the March 2024 capital raise, we made substantial changes to the Board to improve our corporate governance framework. Highlights of our current governance standards and policies framework include:
| • | Our Board of Directors is comprised of individuals possessing a well-rounded variety of skills, knowledge, experience and perspectives and who bring diverse and specialized experience and perspectives on our business. |
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| • | As part of the 2024 Board Turnover, our Board welcomed five new members to the Board (See page 21 for the specific appointments). |
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| • | The new Board is committed to enhancing the Company’s corporate governance practices and recognizes that sound corporate governance practices are necessary to build the trust and confidence of the shareholders and other stakeholders. |
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| PROXY STATEMENT SUMMARY | ENVIRONMENTAL, SOCIAL & GOVERNANCE | SUMMARY OF THE MARCH 2024 CAPITAL RAISE | CORPORATE GOVERNANCE | EXECUTIVE COMPENSATION | STOCKHOLDER PROPOSALS | INFORMATION ABOUT OUR ANNUAL MEETING AND SOLICITATION OF PROXIES | ADDITIONAL INFORMATION |
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| • | 78% of our Board members satisfy NYSE independence standards (“Independent Directors”), and each of the Compensation, Audit, and Nominating and Corporate Governance Committees is comprised wholly of Independent Directors. |
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| • | Our Lead Independent Director has significant governance responsibilities. |
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| • | Our Bylaws provide for “proxy access,” allowing eligible shareholders to include their own nominees for director in the Company’s proxy materials. |
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| • | Our Board Risk Assessment Committee, which meets the requirements for U.S. Bank Holding Companies under the Dodd-Frank Act’s Enhanced Prudential Standards, meets at least on a quarterly basis and oversees a robust and exacting enterprise risk management program. |
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COMMUNITY SUPPORT:
Service to our customers and the community is an important part of the Company’s and Bank’s culture. We support the communities we serve through lending, investments, services, and charitable giving, including through the New York Community Bank Foundation, the Richmond County Savings Foundation, and the Flagstar Foundation (the “Foundations”), with the following notable highlights:
| • | Bank employees in 2023 volunteered more than 10,000 hours of service to over 300 community organizations; |
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| • | In 2023, the Bank and the Foundations contributed over $10.7 million through grants, sponsorships, and community grass-roots initiatives; |
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| • | The Bank donated to over 400 charitable organizations and employees volunteered at more than 1,700 community events during 2023; |
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| • | The New York Community Bank and Richmond County Savings Foundations awarded more than $2.3 million combined in grants during 2023 to more than 190 community organizations throughout the Tri-State area supporting charitable causes including, among others, health and human services, education, civic and community services, and arts and culture; |
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| • | The Flagstar Foundation awarded more than $3.1 million in grants during 2023 to more than 165 community organizations in Michigan, Indiana, Ohio, Florida, Arizona, New York, New Jersey, and California aiding citizens in their communities through supporting charitable causes in workplace readiness, arts and culture, financial capability- tax preparation services, and disaster relief funds; |
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| • | Between the Flagstar Gift, Flagstar New York and Flagstar Power-Up programs, the Bank provided $1.8 million in down payment assistance in 2023; and |
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| • | The Legacy Organization made a combined total of 91 Community Development Loans for $856.6 million in 2023, distributing such funds widely across the entirety of the Bank’s CRA assessment areas. |
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| PROXY STATEMENT SUMMARY | ENVIRONMENTAL, SOCIAL & GOVERNANCE | SUMMARY OF THE MARCH 2024 CAPITAL RAISE | CORPORATE GOVERNANCE | EXECUTIVE COMPENSATION | STOCKHOLDER PROPOSALS | INFORMATION ABOUT OUR ANNUAL MEETING AND SOLICITATION OF PROXIES | ADDITIONAL INFORMATION |
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