New York Community Bancorp (NYSE:NYCB) is, I fervently believe, one of the best banking stocks available. The company's fundamentals are solid, it manages its business very well, and it has a solid grip on a very lucrative and dependable niche market. It also boasts an extremely high dividend relative to its share price, at 6.3%, well above not only the current S&P 500 average but also the firm's regional and national banking rivals.

A dividend that mighty isn't cheap, however. New York Community Bancorp has lately had a payout ratio (i.e., the percentage of net profits it distributes as dividends) just shy of 100%, which leaves almost no maneuvering room should its business sour. At first glance, this is worrying -- how likely is it that a slip in profit will occur, putting that beloved dividend at risk?

Smooth operator
New York Community Bancorp has one of the steadiest dividends not only in the financial sector, but across the wider stock market. It's paid a $0.25 per share quarterly dividend for over ten years running, a remarkable feat given the scary near-collapse of its sector back in the dark days of the Great Recession.

In those run-for-the-bunker times, the company's payout ratio spiked briefly. Well, perhaps "spiked" doesn't quite capture the magnitude -- it shot well into space, at one point exceeding 750%. In other words, for a moment the firm had to distribute seven and a half times what it netted in profit. At most banks this would result in a serious liquidity crisis, if not an outright collapse.

NYCB Payout Ratio (TTM) Chart

NYCB Payout Ratio (TTM) data by YCharts

New York Community Bancorp, however, is different. The company absorbed that body blow, and went right on paying that $0.25 per share without blinking. That's remarkable, but par for the course for this most exceptional lender.

Steady as it goes
A major reason New York Community Bancorp's that successful and resilient is because its business is extremely focused. Its loan portfolio is overwhelmingly dominated by mortgages for residential properties in the ferociously expensive and competitive New York City metropolitan area. 

That has always been, and likely always will be, a highly desirable place to live. No wonder the bank has an atypically low level of non-performing loans; it's uncommon for borrowers to default on lucrative rental properties that are in such high demand. 

On top of that, a great many of those homes are -- typically for the city -- rent-controlled. So, much of the bank's take is from high-demand housing stock with strong, predictable revenue streams.

New York Community Bancorp's bottom line reflects this. On a per-share basis, net profit came in at $0.27 in the firm's Q3 of this year. Looking back to the previous quarter, the number is precisely the same. Rewinding further, Q3 2013 saw the bank post EPS of $0.26.

Safe as houses?
There is no such thing as a sure investment, particularly in finance. Sooner or later good banks lend to bad people, suffer shock defaults from important borrowers, or take a left turn into an unproductive line of business. And once in a great while, the entire system buckles, as we saw back in the bad old days of the recession.

But if there's one bank out there that can be relied on to keep its focus tight and its profitability up, it's New York Community Bancorp. People are going to continue to want to live in New York City, and pay sky-high rents for the privilege. The company's core business is probably not going to take a dive anytime in the near future, at the very least.

Consequently, it should be able to run for quite some time with that lofty payout ratio and fat dividend yield without breaking too much of a sweat.