(Alliance News) - Embattled lender New York Community Bancorp announced Wednesday that it has lined up more than USD1 billion from investors led by the firm of former US Treasury Secretary Steven Mnuchin.

NYCB, which had seen its share price plunge more than 40% earlier Wednesday before trading was halted, said the consortium was led by Mnuchin's Liberty Strategic Capital and also includes Hudson Bay Capital and Reverence Capital.

Shares in NYCB were down 31% at USD4.18 in New York on Wednesday afternoon.

The transaction is scheduled to close on March 11, pending regulatory approvals.

The questions surrounding NYCB are reminiscent of those that swirled around Silicon Valley Bank, Signature Bank and First Republic before all three failed in the spring of 2023.

NYCB acquired much of Signature Bank out of receivership from the Federal Deposit Insurance Corporation last March.

In May 2023, JPMorgan Chase & Co acquired the substantial majority of assets and assumed the deposits and certain other liabilities of First Republic from the Federal Deposit Insurance Corp.

source: AFP