This Bank Stock Has the Highest Dividend Yield In Its Sector and Is Safe to Own

There are few banks that are able to pay a massive dividend while exposing shareholders to little risk. It's for this reason that New York Community Bancorp has long been coveted by income-seeking investors.

May 14, 2014 at 6:36PM


If you're looking for a high-yielding bank stock, it's hard to get much better than New York Community Bancorp (NYSE:NYCB). Not only does the New York-based lender sport a 6.6% yield, but it's also one of the safest bank stocks to own today.

What makes these two things possible?

First, New York Community Bancorp doesn't write bad loans, which is the absolute "most important thing" about great bank stocks. Even at the height of the financial crisis, it charged off only 0.53% of its loan portfolio. This was dramatically better than even industry darling US Bancorp, which had a net charge-off ratio of 2.49% in the first quarter of 2010. And there's simply no comparison to the likes of Bank of America (NYSE:BAC), which wrote off 4.7% of its loan book at its peak five years ago.

Second, New York Community Bancorp is phenomenally efficient. With an efficiency ratio in the low-40% range, it blows away competitors like Bank of America, which are struggling against bloated expense bases that may never be remedied -- click here to see how the nation's biggest banks stack up in this regard.

As Motley Fool senior banking specialist John Maxfield explains in the video below, the net result is that unlike Bank of America and others, New York Community Bancorp is able to pass on the lion's share of its revenue to shareholders via dividends.

Is New York Community Bancorp the best dividend option?
The smartest investors know that dividend stocks simply crush their non-dividend paying counterparts over the long term. That's beyond dispute. They also know that a well-constructed dividend portfolio creates wealth steadily, while still allowing you to sleep like a baby. Knowing how valuable such a portfolio might be, our top analysts put together a report on a group of high-yielding stocks that should be in any income investor's portfolio. To see our free report on these stocks, just click here now.

John Maxfield has no position in any stocks mentioned. The Motley Fool recommends Bank of America. The Motley Fool owns shares of Bank of America. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

Click here to learn about this incredible technology before Buffett stops being scared and starts buying!

David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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