Short sellers targeting regional bank stocks up $1 billion -Ortex

NEW YORK (Reuters) – Short sellers targeting shares of a group of U.S. regional banks, including New York Community Bancorp (NYSE:), were up about $1.04 billion in paper profits over the last two sessions, according to data and analytics company Ortex.

New York Community Bancorp (NASDAQ:), down about 40% since Tuesday’s close of trading after announcing a surprise loss and a 70% divided cut, accounted for about $122 million of those gains.

Short sellers aim to profit by selling borrowed shares and buying them back later at a lower price.

About 3.6% of New York Community Bancorp’s free float is sold short, according to Ortex data, little changed over the last two days and slightly below the 3-month average of 4.18%.

During last year’s regional banking crisis short sellers targeted shares of banks including First Republic Bank (OTC:), Silicon Valley Bank and Signature Bank (OTC:), possibly exacerbating share price declines.