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New York Community Bancorp: M&A Rumor Winner

The SIFI status will certainly bring up the subject of New York Community Bancorp's quarterly dividend of 25 cents a share, for a dividend yield of 7.16%. That's the highest yield on common shares for actively traded U.S. banks, according to Thomson Reuters Bank Insight.

Please see TheStreet's 10 Buy-Rated Bank Stocks With Highest Dividend Yields for details on other bank stocks with high dividend yields.

New York Community Bancorp reported 2012 net income of $501.1 million, or $1.13 a share, increasing from $480.0 million, or $1.09 a share in 2011. Some analysts have questioned New York Community Bancorp's ability to continue paying out nearly all of its earnings, especially if the company becomes an SIFI.

When discussing the possibility of the company being forced by regulators to cut the dividend if and when it is treated as an SIFI, "Ficalora said during the company's earnings conference call on Jan. 30 that "there is individual review of every bank with regard to capacity to pay. And the limitation on capacity to pay is driven by the adequacy of your capital to deal with stress. There is no indication that we aren't way overcapitalized based on the likely charges we would have to capital."

Gilbert said there was a "favorable risk/reward" in her analysis of several possible deal outcomes for New York Community Bancorp, most of which would include the company maintaining the annual dividend of $1.00 a share. But if the company is unable to complete a major acquisition, with weak loan demand continuing in a hostile interest rate environment, she said there was "potential downside" to a share price of $12.00.

A Market Pause

After seven straight winning sessions for S&P 500 (SPX.X) Index, investors' excitement over the U.S. economic recovery seemed to fade. The S&P and Nasdaq Composite (^IXIC) indices saw slight declines, while the Dow Jones Industrial Average (^DJI) rose slightly.

ManpowerGroup on Tuesday released the results of its quarterly survey of employers, saying that "hiring decision makers continue to take a measured but optimistic approach to hiring plans for Quarter 2 2013."

"Of the more than 18,000 employers surveyed, 18 percent expect to add to their workforces in Quarter 2 2013, while 5 percent expect a decrease in payrolls, resulting in a Net Employment Outlook of +13%," Manpower said. On a seasonal adjusted basis, the Net Employment Outlook was +11%, increasing from 10% both in the previous quarter and a year earlier, the staffing company.
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