New York Community Bank has announced a major restructuring plan as part of its strategic efforts to revitalize its business. The bank will lay off 700 employees, which accounts for 8% of its workforce, at its subsidiary Flagstar Bank. This move is part of a broader initiative to strengthen its financial foundation and improve competitiveness.
Earlier this week, New York Community Bank declared its rebranding to Flagstar Financial, effective shortly. Additionally, the bank plans to complete the sale of its residential mortgage servicing operations this quarter. This transaction is expected to result in a further reduction of 1,200 employees.
CEO Joseph Otting expressed confidence in these strategic actions, despite the difficult decisions involved, as essential for building a more agile and competitive company. Otting, previously the head of the U.S. Office of the Comptroller of the Currency, is leading a comprehensive reform of the bank. The bank has faced significant stock price declines this year due to concerns about its New York commercial real estate business.
