First up, from Barron's, February 1:
Shares of New York Community Bancorp plunged 38% Wednesday after the regional bank reported a surprise loss, and wrote down bad real-estate loans.
New York Community Bancorp isn’t the only bank ringing alarm bells over U.S. commercial real estate loans—there has been another warning from Japan.
Shares in regional bank New York Community plunged 38% Wednesday, their biggest-ever one-day drop, after the lender reported a surprise loss and wrote down bad real-estate loans. Ratings agency Moody’s put the bank’s credit rating on review for a downgrade Wednesday.
Wall Street also was reviewing its assessment of the stock. Raymond James and Jefferies downgraded the shares to the equivalent of Hold. J.P. Morgan, however, said the selloff was “overdone” and maintained a Buy rating, reiterating NYCB remained its top pick for 2024; it lowered NYCB’s price target to $11.50—implying a 78% upside to Wednesday’s $6.47 closing price—from its previous target of $14.
As investors and analysts digested the fallout, there was another warning about U.S. office loans overnight.
Japan’s Aozora Bank said it expects to post a net loss for the fiscal year, due to higher provisions for U.S. office loans. It was a sharp revision to a loss of 28 billion yen ($190.5 million), from a previous forecast for profit of 24 billion yen. The stock plunged 21% Thursday....
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The FT's man in Japan, former Alphavillain David Keohane goes deeper, February 1:
US office building losses hit Japanese lender Aozora
Bank’s shares fall more than 20% after it warns more commercial property loans could turn sour
Japan’s Aozora Bank blamed souring office loans in the US as it forecast its first full-year loss since 2009, in a sign of the rising stress in the American commercial property market.
Shares in Aozora fell by their maximum limit on Thursday after the midsized bank projected a full-year loss on overseas real estate loans and warned that it would take as much as two years for the US office market to stabilise....
....Aozora’s highest financial exposure, in terms of non-performing loans in the US, was to the city of Chicago. In Chicago a “considerable amount of time is required to recover supply and demand balances in urban areas”, the bank said. “The volume of property sales remains very low.”....
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