Don't Bank On It by Neil A. Martin
Highlighted companies: New York Community Bancorp (NYB)
Summary: Like many regional banks, NYCB has been struggling in the current unfavorable interest rate environment (inverted yield curve), and amidst the housing slowdown. Its approach has been to acquire a number of small banks that can help steer its activity toward higher-margin commercial lending. The nation's fifth largest thrift and second largest mortgage lender to multifamily dwellings in the northeast, NYCB's strategy may not work for income investors, as its $1 dividend may need to be cut in the near future. Though Barron's notes that "for speculators, the shares may be worth a bet on the chance of a takeover," given the consolidation that has been occurring among smaller commercial banks.
Related: Seeking Alpha coverage of Regional & Commercial banks