NEW YORK, Nov. 5, 2004 (PRIMEZONE) -- Murray, Frank & Sailer LLP announces that a class action lawsuit was filed in the Eastern District of New York on behalf of a class (the "Class") consisting of all persons who purchased or otherwise acquired the securities of New York Community Bancorp Inc. ("NYB" or the "Company") (NYSE:NYB) between June 27, 2003 and May 9, 2004, inclusive (the "Class Period").
The complaint charges NYB, Joseph R. Ficalora, and Michael P. Puorro with violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. More specifically, the complaint alleges that the Company failed to disclose and misrepresented the following material adverse facts which were known to defendants or recklessly disregarded by them: (1) that defendants manipulated the Company's financial results in order to appear more attractive for potential merger deals; (2) that this was accomplished through leveraged growth funded by short-term funding; (3) the Company's projections about growth and interest rate sensitivity were lacking in any reasonable basis when made; and (4) that the Company's financial results were materially inflated at all relevant times.
On Sunday, May 9, 2004, NYB announced that its Board of Directors had authorized the Company's management team to engage Bear Stearns & Co., Inc., Citigroup Global Markets, Inc., and Sandler O'Neill & Partners, L.P. to assist the Company in undertaking a review of its strategic alternatives, including remaining independent. Commenting on the announcement, defendant Ficalora stated: "We have always been a company that has focused on shareholder value, and this review is consistent with that focus." News of the engagement of Bear Stearns & Co., Inc., Citigroup Global Markets, Inc., and Sandler O'Neill & Partners, L.P. shocked the market. For months, and in numerous interviews, filings, and press releases, defendant Ficalora maintained that, given the nature of the Company's business, assets, and liabilities, NYB would not only do better than its rivals in its sector, but even thrive in an environment of rising interest rates. Furthermore, Ficalora stated that NYB's predictions were based on lower interest rates, and that an interest rate increase would be good for the company. However, the sudden engagement of three financial firms to "review strategic alternatives" was the market's and investors' first indication that NYB's strategy may not be working as planned or advertised.
Following NYB's announcement, in intra-day trading on Monday, May 10, 2004, NYB dropped over $2.53 per share from its previous close, on May 7, 2004, of $24.13 per share, or 10.5%, to close at a low of $21.60 per share. At the close of trading, NYB had fallen $1.33 per share, or 5.5%, to close at $21.80 per share on volume of 9 million shares -- nearly three times its usual volume.
Murray, Frank & Sailer LLP and its predecessor firms have devoted its practice to shareholder class actions and complex commercial litigation for more than thirty years and have recovered hundreds of millions of dollars for shareholders in class actions throughout the United States.
If you purchased or acquired the common stock of NYB between June 27, 2003 and May 9, 2004, inclusive, and sustained damages, you may, no later than November 23, 2004, move the Court to serve as lead plaintiff of the class. Shareholders outside the United States may also join the action, regardless of where they live or which exchange was used to purchase the securities. To serve as lead plaintiff, however, you must meet certain legal requirements. You can join this class action online at http://www.murrayfrank.com/CM/NewCases/NewCases.asp. If you would like to discuss this action, this announcement, or your rights and interests, please contact plaintiff's counsel Eric J. Belfi or Aaron D. Patton of Murray, Frank & Sailer LLP.
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca