New York Community Bancorp's credit rating downgraded to junk on real estate concerns

New York Community Bancorp, a regional bank, suffered a blow as its credit rating was downgraded to junk status by Moody’s Investors Service. The downgrade was due to concerns about the bank’s challenges following the revelation of a surprise loss on its exposure to the struggling commercial real estate market. This two-notch downgrade reflects a loss of faith in the bank’s ability to repay its debt. The downgrade caused a 17% drop in shares during after-hours trading, on top of a 22% decrease during regular trading. Moody’s also highlighted the bank’s funding and liquidity weaknesses and its reliance on market-sensitive wholesale funding.