Torsten Asmus
New York Community Bancorp (NYSE:NYCB) grabbed headlines in the financial sector this week, recording a massive provision for credit losses, on two problem loans and its preparation to meet stricter capital rules.
For the week, financial stocks were mostly treading water. The Financial Select Sector SPDR ETF (NYSEARCA:XLF) edged up 0.9%, while the S&P 500 crept up 1.4%.
Four of the five biggest decliners were regional banks, while the top three gainers were South Korea-based banks helped by an improved outlook for the country’s exports.
New York Community Bancorp (NYCB) stock sank 42% during the week ended Friday, Feb. 2, among financial stocks with market cap over $2B. After its surprise Q4 loss due to its provision for credit losses, at least four firms downgraded the the stock.
MarketAxess (NASDAQ:MKTX) stock tumbled 19% despite a Q4 earnings beat.
Bank OZK (NASDAQ:OZK) dropped 12%, as fears over NYCB spilled over to the Little Rock, Arkansas-based bank’s due to its heavy exposure to commercial real estate in its loan book.
Tupelo, Mississippi-based Cadence Bank (NYSE:CADE) saw its shares slide 11%.
Valley National Bancorp (NASDAQ:VLY) shares also wilted 11%, as more than half of its loans are related to commercial real estate.
The biggest gainers of the week were South Korea-based banks.
KB Financial Group (NYSE:KB) stock jumped 23%, Shinhan Financial Group (NYSE:SHG) climbed 13% and Woori Financial Group (NYSE:WF) increased 11%. In mid-January, Bank of America upgraded Shinhan and Woori to Buy as export growth drew more investor interest in Korea. In the past week, the South Korean won (KRW:USD) weakened almost 0.1% against the U.S. dollar.
Banco Bilbao Vizcaya Argentaria (NYSE:BBVA) rose 9.9% after posting Q4 2023 adjusted EPS of EUR 0.34, up from EUR 0.25 in the year-ago quarter. Net interest income of EUR 5.25B slipped from EUR 5.33B a year ago.
Piper Sandler (NYSE:PIPR) advanced 8.2% as it turned in better-than-expected Q4 earnings and revenue.