Billionaire crypto investor Arthur Hayes on Wednesday mentioned New York Community Bankcorp (NYCB) steadily shifting from a ‘junk’ downgrade by Moody’s to ‘bankruptcy’ amid latest setbacks. He predicts Bitcoin value will rally in response to approaching Fed cash printing.
NYCB’s Bankruptcy Scenario by Arthur Hayes
New York Community Bankcorp (NYCB) credit standing was downgraded to junk. The financial institution is dealing with “multifaceted” monetary dangers and governance challenges, Moody’s wrote in a report on Tuesday.
NYCB shares tumbled 22% in buying and selling hours and 17% after market shut on Tuesday on financial institution run dangers. The lender reported a loss in latest earnings and lower its dividend, stockpiling reserves to cowl troubled loans tied to industrial actual property. New York Community Bank faces setbacks after buying property and liabilities of troubled Signature Bank final 12 months.
BitMEX co-founder Arthur Hayes took to X saying that this confirms a possible chapter for New York Community Bankcorp (NYCB). Arthur Hayes earlier mentioned BTFP and low cost window gained’t assist as “CRE and multi-family residential loans are not eligible collateral.”
He expects Bitcoin to be risky, but when NYCB and different banks’ inventory costs proceed to plunge a brand new bailout may come quickly. Bitcoin value will rally just like March 2023 value motion.
Oh child …
From junk to bankrupt, that’s the longer term.
And then more cash printer go brrrr$BTC = $1mm pic.twitter.com/6Ia00GWYa5
— Arthur Hayes (@CryptoHayes) February 7, 2024
New York Community Bankcorp Sued by Shareholders
New York Community Bancorp was sued by shareholders after the inventory value tumbled to almost 27-year low, reported Reuters. The shares to open under $3.50 on Wednesday amid a quantity of troubles, together with no Fed charge cuts in March anticipated by Fed Chair Jerome Powell.
In the category motion filed in Brooklyn federal court docket, shareholders allege that NYCB defrauded them by failing to reveal growing reserves for troubled loans tied to industrial actual property and lower dividends by 71% to shore up its steadiness sheet.
Regional financial institution shares are beneath stress, inflicting the KBW Regional Banking Index down about 12% this 12 months, as per Yahoo Finance.
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