New York Community Bank Raises $1 Billion in Emergency Cash

New York Community Bank, the midsize lender under pressure over its real estate loans and internal management, announced an overhaul on Wednesday that included more than $1 billion in emergency cash, the addition of former Treasury Secretary Steven Mnuchin to its board and the appointment of its third chief executive in a month.

The deal was an attempt to shore up a bank that has lurched from shock to shock this year, and attracted the attention of regulators in Washington eager to avoid another banking crisis close to the one-year anniversary of the collapse of Silicon Valley Bank.

The investment of more than $1 billion includes cash from Mr. Mnuchin’s private equity firm, Liberty Strategic Capital, and Kenneth Griffin’s Citadel Global Equities, among others.

The bank’s new chief executive, Joseph Otting, worked closely with Mr. Mnuchin in the past. He ran OneWest Bank, then owned by Mr. Mnuchin, for five years. He also oversaw the Office of the Comptroller of the Currency, one of the banking industry’s primary regulators, during the Trump administration.

Mr. Otting was a controversial figure in government, feuding with other regulators and angering critics who said his proposals would have defanged rules requiring banks to invest in poor communities and lend to low-income individuals.

The troubles at New York Community Bank began when it posted a $240 million loss in its most recent earnings report in January, mostly tied to apartment and office building investments, surprising analysts and investors and causing the stock to tank swiftly.