Billionaire crypto investor Arthur Hayes on Wednesday mentioned New York Group Bankcorp (NYCB) step by step shifting from a ‘junk’ downgrade by Moody’s to ‘chapter’ amid current setbacks. He predicts Bitcoin value will rally in response to imminent Fed cash printing.
NYCB’s Chapter Situation by Arthur Hayes
New York Group Bankcorp (NYCB) credit standing was downgraded to junk. The financial institution is dealing with “multifaceted” monetary dangers and governance challenges, Moody’s wrote in a report on Tuesday.
NYCB shares tumbled 22% in buying and selling hours and 17% after market shut on Tuesday on financial institution run dangers. The lender reported a loss in current earnings and lower its dividend, stockpiling reserves to cowl troubled loans tied to business actual property. New York Group Financial institution faces setbacks after buying belongings and liabilities of troubled Signature Financial institution final yr.
BitMEX co-founder Arthur Hayes took to X saying that this confirms a probable chapter for New York Group Bankcorp (NYCB). Arthur Hayes earlier mentioned BTFP and low cost window received’t assist as “CRE and multi-family residential loans should not eligible collateral.”
He expects Bitcoin to be unstable, but when NYCB and different banks’ inventory costs proceed to plunge a brand new bailout might come quickly. Bitcoin value will rally just like March 2023 value motion.
Oh child …
From junk to bankrupt, that’s the longer term.
After which extra money printer go brrrr$BTC = $1mm pic.twitter.com/6Ia00GWYa5
— Arthur Hayes (@CryptoHayes) February 7, 2024
New York Group Bankcorp Sued by Shareholders
New York Group Bancorp was sued by shareholders after the inventory value tumbled to just about 27-year low, reported Reuters. The shares to open under $3.50 on Wednesday amid a lot of troubles, together with no Fed fee cuts in March anticipated by Fed Chair Jerome Powell.
Within the class motion filed in Brooklyn federal court docket, shareholders allege that NYCB defrauded them by failing to reveal growing reserves for troubled loans tied to business actual property and lower dividends by 71% to shore up its stability sheet.
Regional financial institution shares are underneath strain, inflicting the KBW Regional Banking Index down about 12% this yr, as per Yahoo Finance.
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