Overview

A class action lawsuit has been filed against New York Community Bancorp, Inc. (exchange for FlagstarBank N.A. f/k/a Flagstar Bancorp, Inc.) (Other: FLG) (“NYCB” or the “Company”) and certain of the Company’s current and former senior executive officers alleging violations of the federal securities laws.  The NYCB class action lawsuit is brought on behalf of all persons and entities who purchased or otherwise acquired NYCB common stock in exchange for FlagstarBank N.A., f/k/a Flagstar Bancorp, Inc. (“Flagstar”) securities pursuant to the S-4 registration statement, 424B3 prospectus, and materials incorporated therein (collectively, the “Registration Statement” orthe “Offering Documents,” which were issued in connection with the transaction pursuant to which NYCB acquired and merged with Flagstar (the “Merger”)).  The Merger, announced in April 2021, closed on December 1, 2022.  Investors have until February 18, 2025 to seek appointment as lead plaintiff in the NYCB class action lawsuit.

NYCB was a bank holding company incorporated under Delaware law.  NYCB is the issuer and a direct seller of all shares of NYCB common stock sold to investors and other former Flagstar shareholders in the Merger, and Defendants NYCB and the other Defendants conceived, negotiated, and controlled the Merger and the Offering Documents filed in connection with the Merger.  On October 8, 2024, NYCB’s Board of Directors (the “Board”) approved an amendment to the Company’s Amended and Restated Certificate of Incorporation (the “Certificate of Incorporation”) changing the Company’s name from New York Community Bank, Inc. to Flagstar Financial, Inc. (“New Flagstar”).  As of October 28, 2024, NYCB trades on the New York Stock Exchange under the symbol “FLG.”

The NYCB class action lawsuit alleges that prior to its merger, Flagstar was a holding company for Flagstar Bank, a federally chartered stock savings bank with $29.4 billion in assets, while NYCB, one of the nation’s largest regional banks, specialized in commercial real estate lending.  Under a stock-for-stock exchange agreement, Flagstar stockholders received NYCB shares in exchange for its Flagstar shares.  The Offering Documents promoting the merger contained numerous materially false and misleading statements, including overstating NYCB’s income, goodwill, and total assets, and understating expenses and losses.  Additionally, NYCB’s underwriting and risk management systems were misrepresented as rigorous and conservative, despite significant weaknesses and risks in its loan portfolio.

Following the merger, the true state of NYCB’s financial condition began to emerge.  On January 31, 2024, NYCB announced a $252 million net loss for the fourth quarter of 2023 due to a $552 million provision for loan losses, far exceeding analyst expectations.  This announcement led to a 38% drop in NYCB’s stock price.  Subsequent revelations included ineffective internal controls, poorly managed risk assessments, and material weaknesses in internal loan reviews.  These issues caused further stock price declines, credit rating downgrades, and leadership changes, including executive removals and restructuring.

By March 2024, NYCB reported a $2.4 billion impairment of goodwill from historical transactions and disclosed its systemic internal control failures.  These developments caused NYCB’s stock price to plummet, ultimately leading to halted trading and significant losses for shareholders.  The Company later raised $1.05 billion from investors to stabilize its finances.  Plaintiff and other former Flagstar investors allege severe financial harm due to NYCB’s misrepresentations and omissions.

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If you purchased or otherwise acquired NYCB” common stock in exchange for Flagstar securities pursuant to the S-4 registration statement, 424B3 prospectus, and materials incorporated therein (collectively, the “Registration Statement” or the “Offering Documents,” which were issued in connection with the transaction pursuant to which NYCB acquired and merged with Flagstar (the “Merger”)), and you wish to serve as lead plaintiff in this lawsuit, we encourage you to submit your information to DiCello Levitt LLP via the form on this page. 

You can also contact DiCello Levitt partner Brian O’Mara by calling (888) 287-9005 or at [email protected]. 

The deadline to apply to the Court to serve as lead plaintiff in the NYCB class action lawsuit is February 18, 2025.