New York Community Bancorp Inc. completed a deal to raise more than $1 billion of capital through an equity investment by backers led by former U.S. Treasury Secretary Steven Mnuchin, Bloomberg News reported. The troubled commercial real estate lender, which announced the agreement last week, said in a statement late Monday that the transaction has closed and that Mnuchin was appointed lead independent director. The investment was anchored by his Liberty Strategic Capital, as well as Hudson Bay Capital and Reverence Capital Partners. “We believe that this transaction has strengthened the company’s balance sheet and liquidity position and look forward to working with management and the dedicated workforce of NYCB to deliver shareholder value,” Mnuchin said in the statement. The transaction included an issuance of common stock at $2 per share to the investors, as well as some convertible preferred stock. The cohort will own about 40% of the firm on a fully diluted basis, according to the statement, and the investors will also get warrants. The company also plans to ask shareholders to amend its certificate of incorporation to call for a minimum reverse stock split of three for one, in part to “make the bid price more attractive to a broader group of institutional and retail investors.” The stock closed at $3.25 on Monday. Joseph Otting, a former comptroller of the currency, will be NYCB’s chief executive officer, the firm had announced last week, replacing Alessandro DiNello, who will return to his role as non-executive chairman. Along with Mnuchin, Otting and two other investors will join the company’s board.
