New York Pension Buys Shares of New York Community Bank Before Plummet, Cuts Investment in Chinese Companies
A New York pension fund made some strategic moves with its investments recently, buying up shares of New York Community Bank (NYCB) just before their value took a tumble and reducing its stake in two major Chinese companies. The New York State Common Retirement Fund (NYSCRF), one of the largest public pensions in the US, added to its holdings of NYCB in the fourth quarter of 2023, right before the bank’s shares fell in January 2024. At the same time, the pension fund sold off significant amounts of shares in Alibaba Group Holding and Tencent Music Entertainment Group, while also trimming its investment in Palantir Technologies.
NYCB Stock and Performance
NYCB stock saw a modest gain of 19% in 2023, falling short of the 24% rise of the S&P 500 index. However, the stock took a major hit in 2024, dropping 52% compared to the index’s 4.9% increase. Despite this, NYCB executives and directors recently purchased shares of the struggling bank.
New York State Common Retirement Fund’s Movements
NYSCRF increased its stake in NYCB by buying an additional 184,757 shares in the fourth quarter, bringing its total investment to 1 million shares. In contrast, the pension fund sold 173,379 Alibaba American depositary receipts (ADRs) to reduce its ownership of the Chinese company to 318,731 ADRs. NYSCRF also sold 1.2 million Tencent Music ADRs and reduced its holding in Palantir Technologies by selling 199,120 shares.
The New York State Comptroller’s office declined to comment on the changes to its investment portfolio, citing active manager activity and routine rebalancing as reasons for the decisions. As of March 31, 2023, the audited value of NYSCRF’s assets was $248.5 billion at the close of the previous fiscal year.
Analyst comment
Negative news.
As an analyst, the market for New York Community Bank (NYCB) is expected to face difficulties as the stock plummeted and the bank experienced a surprise loss in Q4 2023. However, executives and directors purchasing shares may indicate confidence in a potential recovery. The reduction in investments in Alibaba Group Holding and Tencent Music Entertainment Group suggests a lack of confidence in the Chinese market. The market for Palantir Technologies is expected to perform well due to its strong earnings and continued stock growth.
