10 May 2011 New York Community Bancorp (NYB) 2 Investment Thesis New York Community Bancorp (NYB) is a strong niche player in the multi-family lending space. While competition remains high in the metro-New York markets, multifamily activity is picking up. We recognize that competitive and pricing pressures exist; however, NYB is positioned to benefit from the consolidation of players in their markets and is likely to gain share. First quarter originations were strong; representing the highest loan production volume in several years. NYB’s current loan pipeline stands at levels not posted since 2004. We are optimistic that NYB can generate solid balance sheet growth as the company’s hallmark has been that of a solid asset generator. Stronger balance sheet growth will lead to improved EPS growth and solid returns. Furthermore, credit quality has been solid given NYB’s strong underwriting standards and ability to leverage its expertise in this niche market. Our Outperform Rating and $19 target price remain unchanged. We are fine-tuning our 2011 EPS estimate to $1.18 (from $1.15). Our 2012 and 2013 EPS estimates remain unchanged at $1.35 and $1.50, respectively. We consider the stock’s risk/reward profile attractive, as we see downside support from a strong dividend yield and solid earnings power and greater upside potential via stronger ROTEs, and EPS growth as loan growth and prepayment activity accelerate in 2011. Our price target of $19 reflects 2.7 times our 2011 year-end tangible book value and 14.1 times our 2012 EPS estimate. Our target P/E on 2012 EPS is consistent with NYB’s 10-year median forward P/E ratio of 14.5 times. Our target price of 2.7 times tangible book value represents a premium to peers at 1.4 times; however, we view this as appropriate given NYB’s 2010 ROTE of 19% versus thrift peers at 7%.