Regional lender New York Community Bancorp (NYCB) offered a new reminder Friday that commercial real estate problems are not totally in the rear-view mirror of US banks.

The Hicksville, N.Y.-based regional lender posted higher loan loss provisions and loan write-offs in the third quarter than Wall Street expected. It also reported its fourth consecutive quarterly loss, of $280 million, and delayed its goal of turning profitable by a year to 2026.

Its stock fell 8.3% Friday. As of Friday’s close, it has fallen 65.6% since the beginning of the year.

NYCB is a big lender to office buildings and rent-regulated apartment complexes, especially in New York City. With $114 billion in assets, it is one of the country’s 30 largest banks.

Its stock began plummeting in January after the bank set aside more money for real estate loan losses related in part to those apartment complexes in the New York City area.

NYCB was able to calm the market with an emergency equity infusion from a group that included former Treasury Secretary Steven Mnuchin. A new team began cutting the bank’s exposure to commercial real estate while selling businesses, cutting costs, and laying off employees.

Earlier this year, the bank pledged as part of its turnaround it would turn a profit or break even in 2025.

But on Friday, the bank pushed that forecast to 2026 while also lowering what it estimates it will earn in that breakthrough year.

“The company is making a seismic change, and that commercial bank is going to be better in 2026 and 2027 from a profit and structure and franchise value perspective,” Janney analyst Chris Marinac told Yahoo Finance. “It’s simply going to be more expensive for them to make the transition in 2025.”

NYCB is not the only bank still working its way through commercial real estate burdens.

Wells Fargo (WFC) CEO Charlie Scharf said on Thursday that his bank may lose $2 billion to $3 billion on its commercial real estate office loan portfolio and that the problems are expected to play out over the next three to four years.

“We’re going to lose $2 to $3 billion, it’s a lot of money,” Scharf said at an event in Washington Thursday. “On the other hand, we’ve reserved for all of it.”

Two weeks ago, Wells Fargo disclosed that it had an allowance of $2.42 billion for future credit losses.

Scharf said concerns about commercial real estate are waning, however, as interest rates start to come back down, and that most of the problems are concentrated among office buildings that are emptier than they were pre-pandemic

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It’s “not something that we look at as anything crippling or should have a knock-on impact to any other asset class.”

An October survey from the Mortgage Bankers Association released Thursday reported that delinquency rates on non-office CRE loans are starting to ease even as those rates continue to rise on office building borrowings.

NYCB has roughly $2.6 billion in office loans, but it is more heavily exposed to multifamily properties.

As of the third quarter, about 45% of its loans held for investment are tied to apartment complexes — many of which are rent-regulated buildings in New York state that were impacted by a 2019 New York law change.

New CEO Joseph Otting, a former head of the US Office of the Comptroller of the Currency, has been leading a comprehensive review of its multifamily and other commercial real estate loans as part of an effort to turn around the bank.

It also recently announced plans to eliminate roughly 22% of its employees. Of that total, 700 positions have already been eliminated. The company plans to cut another 1200 more before the end of the year as it closes on the sale of its mortgage servicing and third-party origination business.

At 5 p.m. ET today, it will also officially change its name to Flagstar Financial Inc. On Monday, the bank’s stock will cease trading under its current NYCB ticker symbol and instead trade under the symbol FLG.

The name Flagstar comes from the Troy, Mich.-based lender that NYCB acquired in December 2022.

One big reason for the bank’s change in profitability forecasts is that its expenses will be $50 million to $100 million higher in 2024 and $100 million to $150 million higher in 2025 and 2026.

“I really feel good about the people and the direction that we’re going in,” Otting told analysts Friday.

David Hollerith is a senior reporter for Yahoo Finance covering banking, crypto, and other areas in finance.

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