New York Community Bancorp gained on Friday after its chief executive officer and other insiders bought more than 200,000 shares of the stock, which has lost about half its value since last week’s shock announcement of a dividend cut and larger loan-loss provisions.
The lender was up as much as 11% at midday in New York, for its biggest intraday gain since July, to as high as $4.63. Filings show a handful of insiders at the Hicksville, New York-based bank had purchased shares on Friday. Alessandro DiNello, who was appointed executive chairman this week, bought 50,000. CEO Thomas Cangemi purchased about 11,000, and several other insiders, including board members, also bought. Combined, the purchases amount to about $860,000, according to a calculation by Bloomberg.
“Insider buying today is a very positive development — it is exactly what investors have wanted to see, renewed commitment to ‘eat their own cooking,’” said Christopher Marinac, an analyst at Janney Montgomery Scott.
The company’s market value has declined by more than $4 billion since its Jan. 31 announcement that it would slash its dividend and build a loan-loss provision that was much bigger than analysts had expected. The bank is grappling with concerns about its commercial-property loans and stiffer regulation due to its size. The surprise rattled regional-bank shares broadly, but the sector has since stabilized.
The bank didn’t immediately respond to phone and emailed requests for comment about the transactions.