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New York Community Bancorp still sees M&A as 'best way' to pass $50B

A large deal is still the best path for New York Community Bancorp Inc. to breach the $50 billion-asset mark after the termination of the company's merger with Astoria Financial Corp., New York Community President and CEO Joseph Ficalora said in an earnings release.

"A large deal is still the best way for us to become a SIFI, and ... it still would be fair to expect our transition to SIFI status to occur in conjunction with a transaction of some size," he said in the release. "While we expect to invest more of our resources into becoming SIFI-compliant, we will be monitoring any changes in the regulatory landscape that could influence our plans."

The company on Jan. 25 reported fourth-quarter 2016 net income of $113.7 million, or 23 cents per share. In comparison, it was a net loss of $404.8 million, or 87 cents per share, a year ago.

Full-year 2016 net income, meanwhile, was $495.4 million, or $1.01 per share, compared with 2015's loss of $47.2 million, or 11 cents per share.

The S&P Capital IQ consensus normalized EPS estimates were 26 cents for the recent quarter and $1.05 for the full year.

New York Community Bancorp recorded a net interest margin of 2.86%, down from the linked quarter's 2.91%.

Total nonperforming noncovered assets amounted to $68.1 million, up sequentially from $56.0 million and up from the year-ago period's $60.9 million. The earnings release further noted that $13.3 million of taxi medallion loans were placed in nonaccrual status in 2016. CRE loans and loan originations also declined, due to a general decline in loan demand, aggravated by higher market interest rates after the U.S. election.

Provisions for noncovered loan losses stood at $5.2 million at the end of the fourth quarter of 2016, up from $1.2 million in the linked period. In the year-ago quarter, the company recovered $80,000. Net charge-offs amounted to $1.6 million. New York Community Bancorp had recorded recoveries of $412,000 and $1.2 million, in the linked- and year-ago quarters, respectively.

Merger-related expenses for the quarter amounted to $6.0 million, up from the linked quarter's $2.4 million. The company's efficiency ratio rose to 47.20% from the third-quarter's 44.21%.