U.S. markets closed
  • S&P 500

    +39.95 (+1.06%)
  • Dow 30

    +321.83 (+1.05%)
  • Nasdaq

    +99.11 (+0.90%)
  • Russell 2000

    +19.77 (+1.16%)
  • Crude Oil

    +2.70 (+2.55%)
  • Gold

    +5.60 (+0.31%)
  • Silver

    -0.51 (-2.50%)

    -0.0057 (-0.54%)
  • 10-Yr Bond

    -0.0830 (-2.79%)

    -0.0072 (-0.59%)

    -0.5530 (-0.41%)

    -73.27 (-0.38%)
  • CMC Crypto 200

    +0.70 (+0.17%)
  • FTSE 100

    -0.63 (-0.01%)
  • Nikkei 225

    -457.42 (-1.73%)

New York Community (NYCB) Rolls Out Bank-On-Certified Account

  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
·4 min read
In this article:
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.

New York Community Bancorp, Inc.’s NYCB bank-on certified checking account — My Community SimplyOne Checking account — has been certified by the Cities for Financial Empowerment Fund as meeting the Bank On National Account Standards for 2021-2022.

With this, the company now offers features like a low monthly fee of $5, low minimum opening deposit requirements, no overdraft or non-sufficient fund fees, and access to both online banking and mobile banking with mobile deposit. Also, it provides the ability to send and receive money with Zelle and the option of either paper or e-statements. The company has rolled out the account availability across all of its 237 branches in its five-state footprint in New York, New Jersey, Ohio, Florida and Arizona.

Since bank-on-certified accounts encourage financial inclusion for underbanked and unbanked consumers, with low-cost standard account features that have robust transaction capabilities, the launch of the same by NYCB is likely to help its customers to better manage their finances.

Moreover, it underlines the company’s efforts to equip consumers to monitor and improve their finances in a safe and affordable manner.

Given the growing momentum of its deposit base, the move is likely to significantly benefit New York Community’s customers. Notably, deposits recorded a five-year (2017-2021) compound annual growth rate (CAGR) of 4.8%. The company aims to continue deposit growth through numerous strategies, including further advancement in its existing borrower base, expansion into the Banking as a Service space and additional partnerships with fintech companies.

Further, New York Community’s merger deal with Flagstar Bancorp FBC is expected to offer NYCB a national scale by enhancing its foothold in Northeast/Midwest regions and exposing it to high-growth markets. This, along with deposit growth opportunities in the Banking as a Service space, bodes well for New York Community’s balance-sheet strength.

The all-stock merger deal with FBC was announced in April 2021 and receivedshareholders’ nods in August 2021. The transaction is expected to close in 2022, subject to regulatory consent. It is also likely to advance New York Community’s transformation strategies through geographical as well as product diversification.

However, non-interest income at New York Community declined, seeing a CAGR of 27.1% over the last five years (ended 2021). The key reason behind the decline is the company’s exit from unprofitable mortgage banking and wealth management businesses in 2017 and 2019, respectively. The new checking account is unlikely to substantially boost its fee income, given the low-cost nature and zero overdraft or non-sufficient fund fees features. Hence, New York Community must utilize excess funds toward business development in order to support its top line.

Shares of this Zacks Rank #3 (Hold) company have declined 11.8% over the past year, wider than the industry’s fall of 1%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Zacks Investment Research
Zacks Investment Research

Image Source: Zacks Investment Research

Last month Citigroup Inc. C and M&T Bank MTB also announced the removal of overdraft fees and non-sufficient fund fees.

Citigroup said that it would completely terminate overdraft fees, returned item fees and overdraft protection fees by this summer, making it the largest U.S. lender to do so.

Citigroup’s overdraft fee collection has been among the lowest among its peers. Other than consumer-friendly overdraft policy, the big bank continues to expand access to banking products and services, making banking more financially inclusive for the underserved communities.

MTB, which is a member of the Bank On coalition, announced theremoval of non-sufficient fund fees and an overdraft protection transfer charge from a linked deposit account. It will also diminish overdraft fees to $15 and limiting daily fee assessment to once per day.

The alterations are scheduled to be effective from second-quarter 2022.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Citigroup Inc. (C) : Free Stock Analysis Report

M&T Bank Corporation (MTB) : Free Stock Analysis Report

Flagstar Bancorp, Inc. (FBC) : Free Stock Analysis Report

New York Community Bancorp, Inc. (NYCB) : Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research