New York Community Bancorp downgraded to Hold from Buy at Jefferies

Jefferies downgraded New York Community Bancorp to Hold from Buy with a price target of $7, down from $13. The analyst cites the “unexpectedly faster” regulatory mandate to Cat IV bank compliance for the downgrade. The bank’s actions taken thus far are a solid step forward, but impair profitability significantly given a need to run with higher capital, liquidity and reserves while trailing Cat IV peers modestly, the analyst tells investors in a research note. The firm expects New York Community’s path to improved profitability will take years while credit risk remains an overhang.