NYCB-A New York Community Bancorp Inc

April 21, 2023

Dear Fellow Shareholders:

You are cordially invited to attend the Annual Meeting of Shareholders of New York Community Bancorp, Inc., the holding company for Flagstar Bank, National Association. The meeting will be held in a “virtual” format through a live webcast on Thursday, June 1, 2023, at 10:00 a.m. Eastern Daylight Time. You will be able to attend the Annual Meeting, vote, and submit questions by visiting www.virtualshareholdermeeting.com/NYCB2023.

New York Community Bancorp, Inc. had another strong year in 2022, which was capped off on December 1^st by the closing of the Flagstar Bancorp, Inc. acquisition and the simultaneous merger of our principal banking subsidiary, New York Community Bank, into Flagstar Bank, N.A. (“Flagstar” or “Flagstar Bank”). This acquisition, our largest at the time, has already begun to benefit the organization, as both our loan portfolio and funding mix are more diverse, while our sensitivity to interest rate changes has improved materially to a more balanced position. Further benefits from this acquisition should materialize throughout the remainder of this year and next as we embark on our systems conversion and full integration in early 2024.

Financially, last year was another record year for the Company. On a GAAP basis, we reported full-year diluted earnings per share of $1.26 and net income available to common stockholders of $617 million, compared to $1.20 full-year diluted earnings per share and net income available to common stockholders of $563 million in 2021. We ended the year with total assets of $90 billion, total loans of $69 billion, and total deposits of $59 billion, ranking the Company as one of the largest regional banks in the country.

While we had record results last year, the significant policy shift by the Federal Reserve over the course of 2022 resulted in substantially higher residential mortgage rates. This had a negative impact on Flagstar’s mortgage business as mortgage activity slowed for all participants in the industry. While legacy Flagstar was proactive throughout the past year in rightsizing its mortgage operations, we expect that this business will remain challenged for the foreseeable future. Therefore, in January of this year we made the strategic decision to restructure this business. We currently operate in six channels across the mortgage spectrum and we will continue to do so going forward. However, in the future, the distributed retail channel will operate as an in-branch footprint model in the nine states where we have branches. Our consolidation of all out of footprint locations is expected to result in significant cost savings. We anticipate that these

As a result of our strength and stability, we were able to capitalize on the dislocation in the local marketplace. On March 20^th we announced that Flagstar acquired certain assets and assumed certain deposits (none of which were cryptocurrency deposits) of Signature Bridge Bank, N.A. from the Federal Deposit Insurance Corporation. The deal significantly strengthens our deposit base with an additional $34 billion in low-cost deposits, most of which are non-interest-bearing accounts. We also picked up approximately $25 billion of cash, which affords us the opportunity to pay down a substantial amount of wholesale borrowings, thereby further improving our funding mix, while maintaining a liquid balance sheet and about $13 billion in mostly commercial loans. Importantly, we did not acquire the entire bank, only certain financially and strategically complimentary parts of Signature that will enhance and quicken our growth. This deal builds upon the transformation set in motion by the merger of New York Community Bank and Flagstar Bank, accelerating our evolution into a high-performing commercial bank. The Signature transaction adds a substantial amount of low-cost deposits and is expected to be significantly accretive to both earnings per share and tangible book value per share.

The attached Notice and Proxy Statement describe the formal business to be transacted at the Annual Meeting, including with respect to the Company’s corporate governance, executive compensation, and other matters arising during a most extraordinary year.

I encourage you to cast your vote by signing, dating, and returning the proxy card promptly, or by voting online or by telephone as instructed on the proxy card. As the holders of a majority of the common stock entitled to vote must be represented, either in person or by proxy, to constitute a quorum at the meeting, we would appreciate your timely response.

Directors and officers of New York Community Bancorp, Inc. and Flagstar Bank, as well as representatives of KPMG LLP, the Company’s independent registered public accounting firm, will be present at the meeting and will be pleased to respond to any questions you may have.

On behalf of the Board of Directors, officers, and employees of New York Community Bancorp, Inc., we thank you for your continued interest and support.

Sincerely,

Thomas R. Cangemi

President and Chief Executive Officer

HIGHLIGHTS:

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Our management and Board value direct and transparent engagement with our shareholders and regularly seek opportunities to obtain feedback in connection with our governance, management compensation, and strategies. We embrace engagement as an important tenet of good governance and we value the views of our shareholders and other stakeholders. We believe that positive dialogue builds informed relationships that promote transparency and accountability, allowing us to respond more fully to the interests of our shareholders as they adjust to evolving governance and compensation norms in our competitive industry.

Our shareholder outreach program consists of regular management dialogue with the investor community (the “Management Outreach Program”) and formal outreach by our independent Board members to institutional shareholders (the “Board Outreach Program”).

As part of our Management Outreach Program, senior members of our management team conduct extensive investor communications, including conferences, non-deal road shows (NDR) and individual and group conference calls with portfolio managers and industry analysts. Each quarter’s earnings press release is thoroughly reviewed in open investor conference calls with broad participation and significant Q&A by the analyst community. Our senior management regularly makes themselves available for such communications across the United States and in Europe, focusing on elements of our strategic plans, consolidated business results and capital structure, and other topics of interest to shareholders. We believe that management can strengthen its ability to lead the Company by constructively discussing our business and strategy in such settings.

As part of the Management Outreach Program for 2022, Mr. Cangemi, our Chief Financial Officer, John J. Pinto, and Chief of Staff to the CEO and Director of Investor Relations, Salvatore J. DiMartino, met with shareholders or prospective shareholders at five industry conferences and four non-deal roadshows (NDR), and also conducted numerous individual conference calls with institutional investors. In total, management met with 161 investors from 87 discreet institutions in 2022.

Additionally, as part of the Board Outreach Program, our Presiding Director, the Chair of the Board’s Compensation Committee, and the Chair of the Nominating and Corporate Governance Committee participate in meetings with institutional investors. For several years now, the Company has conducted a formal outreach program in order to allow Board members to hear directly from these investor representatives regarding their perspectives on our governance and compensation practices, among other issues. During such discussions, the Board members solicit feedback from these shareholders that is considered by the Board in making strategic and other decisions.

The Board encourages our shareholders to participate in its outreach program. We typically reach out to invite participation by our top 25 institutional shareholders at each year end and participation levels vary year to year. For 2022, this group represented 44% of our then outstanding shares. Of those contacted, investors representing 49% of the then outstanding shares made themselves available to speak with us, including two of three largest shareholders.

Additional disclosure regarding the relationship between our NEO compensation programs and long-term value creation appears on page 27 of this proxy statement. Stockholders are urged to read the Compensation Discussion & Analysis section and other information in this Proxy Statement to better understand how the Company’s executive compensation program engages and aligns with the Company’s performance.

Results of Election of Directors at 2022 Annual Meeting—At our 2022 annual meeting of shareholders, Marshall J. Lux, Ronald A. Rosenfeld, and Lawrence J. Savarese were re-elected to the term of the Board that expires at the 2025 annual meeting of shareholders. Each received an affirmative vote of more than 80% of the votes cast for their re-election with the combined average percentage being 94% of the votes cast.

We value shareholder input and we encourage you to share your opinions with us. You can do so by writing to us at the address on page 103 of this proxy statement. You can also provide feedback on our executive compensation program by contacting us through our Investor Relations Department (please visit our website www.myNYCB.com) or through the other contacts identified on page 24 of this proxy statement.

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As a responsible steward of financial services, the Company has continued to evolve its understanding and approach to environmental, social, and governance (ESG) issues over the last several years. The Company has grown to have nine full-time employees dedicated solely to ESG efforts. We are committed to operating in a responsible, transparent, and sustainable manner.

Our corporate responsibility strategy is focused on leveraging leading ESG practices across our business and we have been recognized for our leadership in this space, including receiving the following recognitions over the past year:

The Company strives to reduce its environmental impact by identifying and evaluating opportunities to increase energy and water efficiency, reduce greenhouse gas emissions, invest in projects that reduce energy and water consumption that meet our rate of return thresholds, and focus on the environmental aspects within our supply chain. As representative examples, in 2022 we strengthened our environmental commitment by:

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The Company values and is committed to its employees and local communities in fostering positive diverse cultures and backgrounds. We believe that a diverse workforce is critical to our long-term success. We have a number of social initiatives in place that are focused on fostering a more diverse workforce, giving back to our communities, and ensuring the health and well-being of our employees.

Our diversity, equity, and inclusion (DEI) vision is built around six focus areas:

Each of these focus areas and senior leaders within the Company are responsible for driving DEI efforts in talent acquisition, talent retention, community connectivity, and a diverse supplier and customer base. We have formed DEI Committees comprised of senior executives, including our CEO, to govern our overall program and monitor the progress of our focus areas. We strive to achieve our DEI vision by hiring great people who represent the talents, experiences, backgrounds, and diversity of the communities we serve. In addition, we are focused on crafting financial products and services tailored to make a real difference to our customers.

We regularly conduct employee surveys to assess the job satisfaction of our employees and use information from the surveys to improve our ability to attract, develop, and retain talented employees and ensure our long-term success. Our commitment is reflected in established policies that govern the approach to our workforce, including our Diversity, Equity, and Inclusion Policy. In addition, we participate in and sponsor events focused on diversity, including those for individuals with disabilities, LGBTQ+, veterans, and more.

The DEI vision comes to life in our recruiting strategies, diversity, equity, and inclusion training, and Employee Resource Groups (ERG), which are key to our efforts. Our ERGs, which are led by employees and partnered with executive sponsors, provide our associates access to coaching, mentoring, and professional development. Our efforts have been focused on the following ERGs within the Company: African American, Asian-Indian, Hispanic / Latinx, Inter-Faith, Green Team, LGBTQ, Military Veterans, Native American, People with Disabilities, Women, and Young Professionals. Additionally, we’ve continued to host “Let’s Talk About It” sessions for employees to engage in complex conversations, gain an understanding of our DEI goals, and evolve. We continue to work toward infusing DEI into all of our programs and activities, both internally and externally and throughout our culture.

We believe in the importance of corporate philanthropy and giving back to the communities in which we operate. The Company looks to support charitable causes within our key market areas. We support the communities we serve through lending, investments, services and charitable giving, including through the New York Community Bank Foundation, the Richmond County Savings Foundation, and the Flagstar Foundation. Since 2000, the New York Community Bank Foundation and the Richmond County Savings Foundation have awarded more than $99.4 million combined in grants to more than 6,200 non-profits and community organizations throughout the Tri-State area supporting charitable causes such as health and human services, education, civic and community services, and arts and culture. We further reaffirmed our commitment to our communities in anticipation of the merger by making a $22.1 million contribution to the Company’s Flagstar Foundation. The Flagstar Foundation looks to provide grants to nonprofit organizations and support charitable causes that align with our corporate philanthropy priorities of arts and culture, workforce readiness and financial capability within the communities we serve. Since its creation in 2017, the Flagstar Foundation’s total contributions have been over $10 million.

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The Company was certified by the Cities for Financial Empowerment Fund as meeting the Bank On National Account Standards for 2021 – 2022. Bank On-certified accounts promote financial inclusion for the underbanked and unbanked consumers through standard account features that are low-cost, with robust transaction capabilities. Additionally, a Spanish-language version of the www.myNYCB.com website and its direct banking website www.MyBankingDirect.com were launched to meet the needs of our customer base.

The Company’s wholly-owned subsidiary, Flagstar Bank, N.A., is a leading multifamily mortgage portfolio lender. While a significant share of the multifamily mortgage loans we originate are for properties in New York and New Jersey, where rent-regulated apartment buildings are a predominant housing type, the Bank is also a leading multifamily mortgage portfolio lender in Ohio, Florida, and Arizona. The Bank originated multifamily loans that were primarily secured by non-luxury residential apartment buildings that feature rent-regulated units and below-market rents.

Many of the neighborhoods in which the Bank originates multifamily loans can be considered areas of naturally occurring affordable housing. In the last 11 years, the Bank’s multi-family lending in these neighborhoods, primarily in low- and moderate-income areas, represented 46% of total originated loans and 54% of total originated loan amount. In New York City where the Bank originates a significant share of multi-family loans, 56% of the number of loans and 59% of total loan amount were originated in neighborhoods containing naturally occurring affordable housing more often found in low- and moderate-income areas.

In 2022, the Company and the National Community Reinvestment Coalition (NCRC) announced the Company’s commitment to provide $28 billion in loans, investments, and other financial support to communities and people of color, low-and moderate-income (LMI) families and communities, and small businesses. The agreement includes $22 billion in community lending and affordable housing commitments and $6 billion of residential mortgage originations to underserved and LMI borrowers and in LMI and majority-minority neighborhoods over a five-year period.

The Community Reinvestment Act (CRA) of 1977 encourages certain insured depository institutions to help meet the credit needs of the communities in which they are chartered, including low- and moderate-income neighborhoods, consistent with the safe and sound operations of such institutions. The Bank’s CRA program contributed nearly $3.4 million annually to community organizations.

The Company’s approach aims beyond simply investing—we work to find sustainable solutions. Our employees volunteer their expertise and time in support of our communities. In 2022, our employees, despite the continuing impact of the coronavirus pandemic, volunteered more than 8,000 hours at community organizations. Employees participated in more than 1,000 community events across the communities we serve. In addition, the Bank provides multiple down payment assistance programs, specialty mortgage programs that invest in our communities (CRA focused) and Federal Home Loan Grant programs. In its most recent review of the Bank’s community reinvestment activities, the Comptroller of the Currency, the Bank’s primary regulator, gave the Bank an Outstanding rating, the highest available.

Our Supplier Diversity strategy to increase our partnership with diverse-owned businesses is another initiative that helps us innovate, create value, and puts us at a competitive business advantage, all while giving back to the community. To support this, in 2022 the Company hired a full-time manager to focus solely on this topic.

We also continue to provide tools, resources and support to promote employees’ financial, emotional and physical well-being. Additional details on the Company’s focus on diversity, equity, and inclusion as well as wellness are included in the Human Capital section below.

Our executive leadership and Board of Directors oversee and advance our ESG strategy and initiatives. For example, the Nominating Committee of the Board of Directors oversees various Company ESG activities, including reviewing and monitoring ESG programs. In addition, a number of teams and senior leaders contribute to the oversight of different areas such as sustainability, community investing, talent and diversity, ethics and business practices, remuneration, and risk.

The Risk Assessment Committee of the Board of Directors provides oversight of the Company’s Independent Risk Management function and reviews the Company’s risk policies and frameworks, including with respect to environmental and social risks, incorporating climate risk into our Company risk appetite policy. As part of these initiatives, the Board in 2022 authorized the issuance of the Company’s first Task Force on Climate-Related Financial Disclosures (TCFD) report. The TCFD report summarizes the initial progress we have made, and future enhancements, towards the organization’s goal of appropriately incorporating climate risk identification management into the organization’s overall business strategy. A full copy of the TCFD report can be found at https://ir.mynycb.com/corporate-governance/esg/default.aspx. For more information regarding the Company’s management of environmental and social risks, please see page 11 of Item 1 of Part I and page 40 of the “Risk Factors” section of the Company’s Annual Report on Form 10-K.

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In 2022, we announced changes and appointments to our Board of Directors, resulting in a composition where out of fourteen members three identify as female, two identify as Asian, and one identifies as both African American and Asian. The changes and larger size of the Board of Directors were a direct result of the Company’s merger with Flagstar Bancorp, Inc.

Additional information regarding our ESG programs and initiatives is available on our website at www.flagstar.com/esg. Information on our website, including legacy Flagstar’s past ESG reports or sections thereof as well as our TCFD report, are not wholly incorporated by reference into this proxy.

At December 31, 2022, our workforce included 7,631 employees.

We believe our employees are among our most significant resources and that our employees are critical to our continued success. We focus significant attention on attracting and retaining talented and experienced individuals to manage and support our operations. We pay our employees competitively and offer a broad range of benefits, both of which we believe are competitive with our industry peers and with other firms in the locations in which we do business. Our employees receive salaries that are subject to annual review and periodic benchmarking. Our benefits program includes a 401(k) Plan with an employer matching contribution, healthcare and other insurance benefits, flexible spending accounts and paid time off. Many of our employees are also eligible to participate in the Company’s equity award program, which aligns employee compensation with shareholder interests.    

We are proud to maintain a diverse and inclusive workforce that reflects the demographics of the communities in which we do business. Our Company recognizes that the talents of a diverse workforce are a key competitive advantage. To increase diversity within out talent pool, we work with professional associations, colleges and universities and non-profits to deepen our understanding and better position the organization to recruit and retain talent within the Asian, Black, Latino, LGBTQ+ communities, people with disabilities, neuro-diverse individuals, and talent from other under-represented communities.

We strive to create and foster a supportive environment for all of our employees and are proud to share our business success with individuals whose cultural and personal differences create a more innovative and productive workplace. We engage in significant outreach to veterans, women and minorities in our recruiting efforts, and our policies and practices reflect our commitment to diversity and inclusion in the workplace.

None of our employees are represented by a collective bargaining agreement. We believe our employee relations to be good.

Our management teams and all of our employees are expected to exhibit and promote honest, ethical and respectful conduct in the workplace. All of our employees must adhere to a code of conduct that sets standards for appropriate behavior and all employees are required to complete annual training that focuses on preventing, identifying, reporting and stopping any type of unlawful discrimination.

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The following tables and graphs illustrate the ethnic and gender diversity of the Company’s executives, managers and employees as of December 31, 2022 (by gender and racial/ethnic diversity):

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Our Board, as stewards of shareholder interests, is committed to maximizing long-term shareholder value creation and to maintaining sound corporate governance principles consistent with current rules and practices. Under the leadership of the Nominating and Corporate Governance Committee, we have concentrated significant efforts and resources on ensuring that our overall corporate governance practices serve the best interests of the Company and its various constituencies, focusing on the changing needs for financial institutions in the current regulatory environment and have taken into consideration the governance policies and practices of our peers.

The Board of Directors maintains a Risk Assessment Committee comprised of independent directors to assist the Board, together with the other Committees of the Board, in overseeing and reviewing information regarding our enterprise risk management programs, risk exposure, and risk governance policies and practices. See page 22 for a description of the committee.

Certain governance policies and practices in effect during 2022 include:

The Board-adopted Corporate Governance Guidelines are available on the corporate governance page of the Investor Relations portion of our Company’s website, www.ir.mynycb.com, and also are available in print to any shareholder who requests a copy. These guidelines address, among other matters, the qualifications and responsibilities of directors; functions of the Board and Board committees; director compensation, training, and performance evaluations; and management performance evaluations and succession.

The Board has determined that 10 of our 14 directors are “independent” within the meaning of the rules of the New York Stock Exchange including: Hanif “Wally” Dahya, Leslie D. Dunn, Toan C. Huynh, Marshall J. Lux, Lawrence Rosano, Jr., Ronald A. Rosenfeld, Lawrence J. Savarese, Peter H. Schoels, David L. Treadwell, and Jennifer R. Whip. Additionally, the Board has determined that each of the members of the Audit, Nominating and Corporate Governance, and Compensation Committees are independent in accordance with the listing standards of the NYSE and, in the case of the members of the Audit Committee, the rules of the SEC. In determining the independence of its members, the Board broadly considers all facts and circumstances it deems to be relevant and does not limit such review to a specific set of categorical independence standards. Such determinations are made not merely from the standpoint of the director, but also from that of persons or organizations with whom or which the director has an affiliation. Material relationships can include commercial, industrial, banking, consulting, legal, accounting, charitable, and familial relationships, among others.

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In arriving at its conclusions with respect to the directors named above, the Board determined that the directors had no material relationships (as such term is defined under the listing standards of the NYSE) with the Company either directly or as a partner, shareholder, or officer of an organization that has a relationship with the Company. Director Rosano is a principal in, and has an ownership interest in, an organization that maintains a lending relationship with the Bank. In addition, Ms. Whip serves on the board of directors of two organizations that maintain lending relationships with the Bank. Mr. Rosano and Ms. Whip have fully disclosed such relationships to the Board, and the Board has determined that the subject loans do not involve more than normal risk of collectability or present other unfavorable features, and were made on substantially the same terms (including interest rates and collateral requirements) as those prevailing at the same time for comparable transactions with unaffiliated persons. Each of the loans is fully performing in accordance with its terms. Accordingly, these lending relationships maintained by the Bank would not be inconsistent with a determination that either Mr. Rosano or Ms. Whip is an independent director of the Company.    Further, Director Rosano possesses significant knowledge of, and is a principal in companies that actively participate in, the New York metropolitan area real estate market, where the Bank currently conducts significant portions of its lending business and Ms. Whip provides broad experience in housing finance, strategic initiatives and risk management bringing varied perspective to the Board’s oversight over these principal business areas.

The Company currently relies on an efficient and balanced leadership structure, with Mr. DiNello serving as Non-Executive Chairman, Mr. Dahya serving as the independent Presiding Director and Mr. Cangemi serving as President and Chief Executive Officer (“CEO”). Generally, the structure is intended to be a synergistic one, with Messrs. DiNello, Dahya, and Cangemi working closely together on governance and other Board-level issues.

The Company does not have a formal policy with respect to the separation or combination of the offices of Chairman of the Board and CEO. Rather, the Board has the discretion to combine or separate these roles as it deems appropriate from time to time, which provides the Board with the necessary flexibility to adjust to changed circumstances, such as the consummation of the merger with Flagstar Bancorp, Inc., in which the Board agreed to assign the role of Non-Executive Chairman of the Board to Flagstar’s former President and CEO Alessandro P. DiNello for a period of two years from the closing date of the Flagstar merger after which the position of Chairman would revert to Mr. Cangemi, who will then become Chairman, President and CEO. The Board has determined that it currently is in the best interests of the Company that separating the roles of Non-Executive Chairman and the President and CEO allows the CEO to devote the requisite significant time to, and focus on, managing our business and maintaining our financial strength.

In the position of Presiding Director, Mr. Dahya functions as a Lead Independent Director, identifying strategic priorities to be discussed by the Board, overseeing the Board’s functioning, and helping to ensure that the Board fulfills its stewardship role. The Board prefers the term Presiding Director to emphasize that all directors share equally in their responsibilities as members of the Board. The Presiding Director presides at all Board meetings at which the Non-Executive Chairman is not present, presides over periodic executive sessions of the Board in which management directors and other members of management do not participate, and is responsible for coordinating the annual self-evaluations of the members of the Board. Additionally, the Presiding Director is available for consultation and communication with shareholders as part of the Board’s shareholder outreach program. As a result, the Presiding Director provides a source of Board leadership complementary to, collaborative with, and independent of the leadership of the Non-Executive Chairman and the President and CEO, which promotes best practices and high standards of corporate governance.

As President and CEO, Mr. Cangemi plays a central role in establishing and communicating the Company’s goals and strategies while also carrying out many critical leadership functions in our day-to-day operations. Mr. Cangemi frequently meets and confers with Mr. Dahya and Mr. DiNello and other members of the Board of Directors, whose expertise and counsel provide for a sound and effective governance framework. As Non-Executive Chairman of the Board, Mr. DiNello presides at all Board meetings, having no greater nor lesser vote on matters considered by the Board than any other director and sharing the fiduciary obligations of all our directors to serve the best interests of our shareholders.

Some of the respective duties and responsibilities of the Non-Executive Chairman and Presiding Director include:

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Committee Chairs – All of the Company’s Board Committee chairpersons are independent and are appointed annually by the Board. They approve agendas and materials for their respective committee meetings and serve as the liaisons between committee members and the Board and between committee members and senior management.

Risk Governance – Management of risk is important to the success of our operations and business strategies and our Board devotes significant attention to the oversight of risks inherent in our banking business, including, but not limited to, credit, interest rate, liquidity, price, operational, strategic, compliance and reputational risks.    

The Board reviews the key risks associated with the Company’s strategic plan annually and regularly throughout the year as part of its consideration of the strategic direction of the Company as well as regularly reviewing various Company’s risk management processes reporting and reviewing risks associated with specific business units and corporate functions.

While the Board of Directors as a whole is responsible for risk management oversight, management is responsible for the day-to-day management of the risks faced by the Company. As part of our risk oversight processes, our Chief Risk Officer reports to the Risk Assessment Committee; the Chairman of the Board’s Risk Assessment Committee meets regularly with management to discuss the risks facing the Company and strategies to address these risks; and senior members of management attend Board meetings and are available to address questions or concerns raised by the Board on risk management and other matters.

In carrying out its responsibilities in this area, the Board has delegated important duties to its committees. The Risk Assessment Committee has responsibility to oversee the functioning of the Company’s enterprise risk management program and to ensure that risk is appropriately identified, measured, mitigated, monitored, and reported within approved governance structures. Among its duties, the Risk Assessment Committee reviews with management Company policies regarding risk assessment and management of risks that may be material to the Company, the Company’s system of disclosure controls and system of internal controls over financial reporting, the Company’s governance structure and processes, related person transactions, certain compliance issues and Board and committee structures, and the Company’s compliance with legal and regulatory requirements. The Chairman of the Risk Assessment Committee is independent and the Nominating and Corporate Governance Committee of the Board has determined that he has the requisite risk experience for such position.

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Additionally, the Board’s other Committees, including the Technology Committee, Credit Committee, and Audit Committee, have other important risk oversight functions involving, among other things, ensuring the Company’s operations are maintained in according with the Board approved Risk Appetite Statement.

Information Security – Our management devotes significant time and attention to protecting the information we maintain, including our customer’s sensitive information, and the Board of Directors requires regular reporting regarding our information security controls. Information security breaches and other cybersecurity events can lead to significant financial losses and reputational harm to a breached company, and information security, including cybersecurity, is a high priority for our Company.

The Board’s Risk Assessment Committee and Technology Committee are actively involved in oversight of the Company’s cybersecurity risks, remaining actively engaged in overseeing the Company’s processes for identifying, assessing, monitoring, and managing cybersecurity risk. Accordingly, we continue to develop policies and utilize technology to protect our information and that of our customers from cyberattacks or other corruption or loss. Our Chief Information Security Officer (our “CISO”) is responsible for developing, implementing, and maintaining an effective information security program, which includes a multitude of techniques to secure our operations and proprietary information, such as the performance of risk assessments for the purpose of identifying and documenting risks and mitigating controls, network monitoring, access controls, and utilization of dedicated security personnel and consultation with third-party experts when necessary. The Chief Information Security Officer provides regular and, when appropriate, operational reports to the Risk Assessment Committee, the Technology Committee, and information security training to all Board members.

The information security program is subject to independent testing and relies upon industry standards, such as the Federal Financial Institutions Examination Council’s Cybersecurity Assessment framework, to gauge the program’s maturity level, and other evolving standards. The Board, directly and through the Risk Assessment and Technology Committees, actively oversees management’s efforts to maintain and enhance our cybersecurity practices, reviewing and approving information security policies and programs, including those relating to cybersecurity, security risk assessment, security strategies, disaster recovery, business continuity, and incident response plans. The CISO conducts training and awareness programs for the Board to ensure that the Board remains aware and informed of information security incidents and response plans.

The Audit Committee is responsible for overseeing the Internal Audit Department’s testing of the design and operational effectiveness of our cybersecurity controls and for monitoring our cybersecurity program under the Audit Committee’s risk oversight responsibilities as it relates to financial controls. Regular reporting on cybersecurity is provided to both the Risk Assessment and Technology Committees as well as the Board. The Audit Committee serves a key role in managing our risk through oversight of the external and internal audit functions, which test the adequacy of internal controls and the financial reporting process. The Committee oversees risks related to the Company’s financial statements, the financial reporting process, other financial matters, certain compliance issues, and accounting and legal matters.

Finally, the Compensation Committee has responsibility for overseeing certain risks in the Company’s incentive compensation practices and has authority to conduct annual reviews of such compensation arrangements and practices to ensure that they do not encourage inappropriate risk-taking. The Compensation Committee also oversees succession planning for possible successors to the position of Chief Executive Officer and planning for other key senior management positions. The Compensation Committee receives regular reports concerning the Company’s incentive compensation programs and has concluded that the Company’s current compensation arrangements do not encourage inappropriate risks.

In performing these risk oversight functions, the Risk Assessment, Technology, Audit, and Compensation Committees of the Board each have full access to management in the Enterprise Risk Management, Information Security, and Internal Audit areas and in other first and second line functions within the Company, as well as the ability to engage advisors. Each committee reports to the full Board and works with all members of the Board to fulfill its risk oversight objectives. Key members of management maintain regular dialogue with members of our Board and regular reporting to the Risk, Technology, and Audit Committees, as well as the whole Board, regarding various operational, lending, financial, and other issues and actions.

The entire Board reviews and approves, on an annual basis, all significant policies that address risk within our consolidated organization, including credit risk, interest rate risk, liquidity risk, operational risk, strategic risk, and reputational risk. The Board monitors risk through, among other things, reports received on a monthly or more frequent basis from management.

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Majority Voting in Director Elections – Our Certificate of Incorporation requires that nominees for Director in uncontested elections receive a majority of the votes cast in respect of their election as directors. If an election is uncontested, each of our director nominees has agreed to tender his or her irrevocable contingent resignation if he or she is not elected by a majority of votes cast by shareholders. The Board’s Nominating and Corporate Governance Committee will promptly consider the director’s resignation and recommend to the Board whether to accept or reject the resignation. Our Board is expected to act on the Nominating and Corporate Governance Committee’s recommendation within ninety days of the applicable shareholder meeting and will then publicly disclose its decision.

Shareholder Rights Plan – We do not have a shareholder rights plan and are not currently considering adopting one.

Corporate Governance Guidelines – Our Corporate Governance Guidelines formalize certain of the Company’s and the Board of Directors’ existing governance policies and practices with respect to board membership; leadership; roles, procedures and practices; committees; and executive officer evaluations, compensation and succession and also address the governance policies discussed below. These Corporate Governance Guidelines are available on the Company’s website (www.myNYCB.com) under Investor Relations.

Board Self-Evaluations – The Board of Directors annually assesses its effectiveness and the effectiveness of its committees. The independent Presiding Director coordinates the evaluation of the Board as a whole and its committees.

Proxy Access – Our amended and restated Bylaws permit a shareholder, or a group of up to 20 shareholders, that owns three percent or more of the Company’s common stock continuously for at least three years, to nominate and include in the Company’s proxy materials candidates for election as directors. Such shareholder(s) or group(s) of shareholders may nominate up to the greater of two individuals or 20% of the Board, provided that the shareholder(s) and the nominee(s) satisfy the eligibility, notice, and other requirements specified in the Bylaws.

Code of Business Conduct and Ethics – The Company maintains a Code of Professional Conduct, applicable to all Company and Bank employees, which sets forth requirements relating to ethical conduct, conflicts of interest, and compliance with the law. The Code of Professional Conduct requires that the Bank’s employees avoid conflicts of interest, comply with all laws and other legal requirements, conduct business in an honest and ethical manner, and otherwise act with integrity and in the Company’s and the Bank’s best interests. The CEO, Chief Financial Officer and Chief Accounting Officer are bound by the Code of Professional Conduct as well as our Code of Business Conduct and Ethics for the CEO, Chief Financial Officer and other senior financial officers. Copies of both Codes, which also apply to the directors of the Company, are available, free of charge, on the corporate governance pages of the Investor Relations portion of our website, www.ir.mynycb.com, and are available in print to any shareholder who requests a copy.

Stock Ownership Policy – The Company maintains a Stock Ownership Policy which is intended to align the interests of senior executives and non-executive directors of the Company with the interests of the Company’s shareholders, and to support sound risk management by requiring each of them to attain and maintain a target level of stock ownership. The target level of stock ownership in the Company that each must attain and maintain shall differ depending on the applicable officer’s or director’s category and is expressed, for the year being measured, as a multiple of annual base salary for executives and as a multiple of annual retainer for non-executive directors. For the CEO, the multiple is six times base salary, for senior executives (including the NEOs), the multiple is four times base salary, and for the non-executive directors, the multiple is five times the annual retainer exclusive of any compensation for committee fees, meeting fees, and leadership roles.

Executive Sessions of the Board – In 2022, the Board met 13 times in executive session with the CEO and former COO present and, in keeping with the Company’s Corporate Governance Guidelines, met four times in executive session with no members of management present.

Board Diversity and Tenure – The Nominating and Corporate Governance Committee has a commitment to diversity, and is guided by the Company’s diversity philosophy in its review and consideration of potential director nominees. In this regard, the Board and the Committee view diversity holistically. As required under the Company’s Corporate Governance Guidelines, the Committee has adopted criteria to be used in evaluating candidates for Board membership, under which the Board and the Committee consider:

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The Board of Directors has directed that the Nominating and Corporate Governance Committee seek to add qualified members who represent diverse backgrounds, including women and candidates who, among other things, are from racial minority communities. The Board expects that, as changes occur in its membership, the Committee will bring forward nominees representing such diverse backgrounds.

As a result of the consummation of the Company’s merger with Flagstar Bancorp, Inc., the Board amended the Company’s Bylaws to fix the size of the Board at 14 members, of which there currently are (i) eight directors come from the legacy Company Board (before the Flagstar merger), which include the Company’s CEO Thomas R. Cangemi, Hanif M. Dahya, Leslie D. Dunn, Marshall J. Lux, Lawrence Rosano, Jr., Ronald A. Rosenfeld, Lawrence J. Savarese, and Robert Wann; (ii) one new director, James J. Carpenter, the former Chief Lending Officer of the Company, who retired in December 2019 and subsequently served as a consultant for the Company and the Bank; and (iii) five directors from the legacy Flagstar Bancorp Board, including the former CEO of Flagstar Alessandro P. DiNello, who serves as the Non-Executive Chairman of the Company Board of Directors, Toan C. Huynh, Peter H. Schoels, David L. Treadwell, and Jennifer R. Whip.

The Board has not established any specific minimum qualifications for nominees to the Board and evaluates each individual in the context of the Board as a whole, with the objective of recommending a group of members who will best enhance the Company’s success and represent shareholder interests through the exercise of sound judgment and the application of its diversity of experience. In determining whether to recommend a director for re-election, the Committee also considers the director’s past attendance at meetings and participation in, and contributions, to the activities of the Board. In addition, the Committee considers whether the Board has specific needs for certain skills or attributes at a given time (for example, financial or chief executive officer experience). Other criteria for Board membership are set forth in the Company’s Corporate Governance Guidelines and Nominating and Corporate Governance Committee Charter, copies of which are available, free of charge, on the corporate governance pages of the Investor Relations portion of our website, www.ir.mynycb.com, and are available in print to any shareholder who requests a copy.

Our current Board members have an average tenure of six years and the Boards’ composition reflects its desire to maintain a diversity of new and longer-term representation. Our Board believes that director tenure, like other governance factors, should be tailored to the Company’s unique governance needs and challenges. Long-tenured directors can offer significant benefits in the governance of the Company due to the deep knowledge of our business and functioning they acquire through years of service. They provide continuity and stability at the highest governance level, as well as historical perspectives that are indispensable in determining the Company’s strategic vision. Long-tenured directors maintain significant institutional knowledge and offer stability. In addition, due to their historical knowledge of the Company, long-tenured directors can be particularly well suited to exercise Board-level influence and to provide an effective challenge mechanism when required. Over the course of time, in addition to their stature, long-tenured directors develop important working relationships with other Board members and management, resulting in effective collaboration in carrying out the Company’s objectives and management oversight.

Our Bylaws provide that, unless otherwise determined by a majority of the disinterested members of the Board, no person may be elected, appointed, or nominated as a director after December 31 of the year in which such person attains the age of 75. Based upon, among other things, the significant experience, knowledge, and value they offer the Board, the Board has previously and unanimously determined to exempt certain members from this retirement age requirement.

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The Board conducts its business through periodic meetings and through the activities of its committees. In 2022, the Board held nine regular monthly meetings, four special meetings, and the various standing committees of the Board met another 25 times, for an aggregate of 38 meetings. All directors of the Company attended at least 75% of the aggregate number of meetings of the Board and committees on which such directors served during their tenure as a director in fiscal year 2022. Board members are expected to make reasonable efforts to attend all Board meetings and all meetings of the Board committees on which they serve. Absences are excused only for good cause.

The Board has six standing committees as follows: (i) Audit Committee, (ii) Compensation Committee, (iii) Nominating and Corporate Governance Committee, (iv) Risk Assessment Committee, (v) Technology Committee and (vi) Executive Committee. Each committee has a written charter adopted by the Board, which contain detailed lists of the respective Committees duties and responsibilities. Charters for the Audit, Compensation, and Nominating and Corporate Governance Committees can be found on the Investor Relations portion of the Company’s website at www.ir.mynycb.com, and are available in hardcopy to any shareholder who requests them. Each member of the Audit Committee, the Compensation Committee, and the Nominating and Corporate Governance Committee has been determined by the Board to be independent for purposes of the NYSE corporate governance listing standards and within the meaning of regulations of the SEC.

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The following table presents the membership of our Board members on the various Board committees as of April 4, 2023:

Director2

James J. Carpenter

Hanif “Wally” Dahya

Leslie D. Dunn

Toan C. Huynh

Marshall J. Lux

Lawrence Rosano, Jr.

Ronald A. Rosenfeld

Lawrence J. Savarese*

Peter H. Schoels

David L. Treadwell#

Robert Wann

Jennifer R. Whip

Thomas R. Cangemi

Alessandro P. DiNello†

Meetings Held in 2022

8

5

4

6

2

0

26

Chairman of the Committee         Member of the Committee

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A description of the nature and purpose of each of the Board committees follows. Copies of the Committee Charters are available on the corporate governance pages within the Investor Relations portion of the Company’s website at www.ir.mynycb.com.

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The Executive Committee of the Board was formed on December 1, 2022. The authority granted to the Executive Committee by the Board includes, during the interval between meetings of the Board, the exercise of the powers of the Board to act upon any matters which, in the opinion of the Non-Executive Chairman of the Board, should not be postponed until the next scheduled meeting of the Board and which are permitted to be taken by the Committee under applicable laws, the Company’s Amended and Restated Articles of Incorporation, or the Amended and Restated Bylaws of the Company. The members of the Executive Committee are Messrs. DiNello, Cangemi, and Dahya.

In addition to the above described committees of the Company Board, the Credit Committee of the Bank Board serves important governance functions in the lending businesses of the Company. The multi-family, commercial real estate, commercial and industrial, residential, consumer, warehouse, home-builder and other asset-based loans that the Bank originates all are made in accordance with loan underwriting policies and procedures approved by the Committee, which maintain active oversight of management’s loan origination, servicing, and collections processes. Committee members, who have significant experience in real estate and other lending businesses, apply their knowledge and expertise in key policy and risk-management decisions relating to these core business areas.

The authority of the Bank Board Credit Committee includes, among other things, oversight regarding the administration and implementation of loan policies, credit management policies and procedures, lending activities of the Bank’s specialty finance company subsidiary, oversight regarding the administration and implementation of commercial and industrial loan policies, review of the risks associated with loans approved by management, and the delegation of credit authority. Each member has expertise in relevant areas of commercial and residential real estate lending, commercial and industrial lending, lending risk, and the business of financial institutions.

The members of the Credit Committee are Messrs. Carpenter (Chair), Cangemi, Dahya, DiNello, Rosano, and Rosenfeld and Ms. Whip. The Credit Committee held 12 regular monthly meetings and 14 special meetings in 2022.

The Board of Directors expects all directors to attend the Annual Meeting of Shareholders. All of the then-serving Board members of the Company attended the Annual Meeting of Shareholders held on June 1, 2022. Because the meeting was held in a virtual format, all Board members attended telephonically.

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Shareholders and other parties interested in communicating directly with the Company by directing correspondence to any of the individuals listed below. Letters addressed to the Presiding Director will be opened by the Company’s Corporate Secretary, who will review them and forward a summary of such correspondence to the Presiding Director and, if applicable, the Board. If the Corporate Secretary determines that an item of correspondence relates to the functions of the Board or its committees, or otherwise requires their attention, he will direct the item itself to the Presiding Director or other Board members. Directors may at any time review a log of all correspondence received by the Company that is addressed to the Presiding Director as provided above, and request copies of any correspondence.

How to contact us:

It is the policy of the Nominating and Corporate Governance Committee to consider director candidates who appear to be qualified to serve on the Board and who are recommended by shareholders. The Nominating and Corporate Governance Committee may choose not to consider an unsolicited recommendation if no vacancy exists on the Board of Directors and if the Nominating and Corporate Governance Committee does not perceive a need to increase the size of the Board. To avoid the unnecessary use of its resources, the Nominating and Corporate Governance Committee will consider only those director candidates recommended in accordance with the procedures set forth below. To submit a recommendation of a director candidate to the Nominating and Corporate Governance Committee, a shareholder should submit the following information in writing, addressed to the Chairman of the Nominating and Corporate Governance Committee, care of the Corporate Secretary, at the main office of the Company:

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In order for a director candidate to be considered for nomination at the Company’s Annual Meeting of Shareholders, the recommendation must be received at the principal executive office of the Company not less than 90 days prior to the date of the meeting; provided, however, that in the event that less than 100 days’ notice or prior disclosure of the date of the annual meeting is given or made to shareholders, notice by the shareholder to be timely must be so received not later than the close of business on the 10th day following the day on which such notice of the date of the meeting was mailed or such public disclosure was made.

Under the proxy access provisions of our Bylaws, eligible shareholders and/or shareholder groups were permitted to include shareholder-nominated director candidates in our proxy materials for the 2023 annual meeting of shareholders. No such proposals were received. For details about the process to include shareholder-nominated director candidates in our proxy materials, please see Additional Information – Proxy Access Nominations and refer to Article I, Sections 6, 7, and 8 of our Amended and Restated Bylaws. A copy of the Amended and Restated Bylaws of the Company are available, free of charge, in print to any shareholder who requests a copy.

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The following table sets forth, as of April 4, 2023, the names of the nominees, continuing directors, and executive officers of the Company, their ages and, as applicable, the year in which he or she became a director and the year in which his or her term (or in the case of the nominees, their proposed terms) as director of the Company expire. The table also sets forth the amount and percentage of Common Stock beneficially owned by each director, by each named executive officer (as defined on page 29), and by all directors and executive officers as a group as of April 4, 2023.

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I. COMPENSATION DISCUSSION AND ANALYSIS

A. INTRODUCTION

We are pleased to provide our shareholders with an overview of the compensation programs, process and specific compensation decisions for the following executive officers (our “named executive officers” or “NEOs”).

The composition of the NEO group for 2022 reflects the impact of significant developments during the year. Mr. Wann departed as an officer of the Company immediately prior to the closing of the Company’s merger with Flagstar Bancorp, Inc. on November 30, 2022 and Messrs. Smith and Davis joined the Company as officers upon the closing of the Flagstar merger on December 1, 2022. Neither Mr. Wann nor Messrs. Smith and Davis participated in the Company’s 2022 short- and long-term incentive programs. The 2022 NEOs include:

Ø Compensation Discussion and Analysis Roadmap

The Compensation Discussion and Analysis provides shareholders with important information regarding our executive compensation program, including the following:

B. EXECUTIVE SUMMARY

Ø A Transformative Transaction and Business Results

The Company executed on its strategic plan and delivered strong results in 2022. We posted record earnings and the closing of our transaction with Flagstar was transformative. The Flagstar merger accelerates our transition to a commercial bank model with a diversified loan portfolio and funding mix. As a combined company, we can execute our key strategic objective of becoming a top-tier regional bank with the potential for strong capital generation, robust

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deposit growth opportunities, a diversified revenue stream, and reduced sensitivity to interest rate changes. By year-end 2022, we had grown from $60 billion in assets and 237 branches across four states at the beginning of the year to over $90 billion in total assets and 395 branches across nine states.

Throughout 2022, we made significant progress advancing our strategic goals toward a commercial bank model:

Our 2022 financial results reflected strong operating performance with record net income and solid earnings per share, excluding merger-related expenses. Our asset quality remained sound with key metrics comparing favorably to our regional bank peers and the industry generally. The selected financial highlights below provide a summary of our 2022 performance.

The foregoing metrics do not reflect our March 2023 acquisition of select Signature Bank deposits and loans, which further accelerates the execution of our strategic transformation. Management’s 2022 incentive compensation determinations were not influenced by the Signature Bank transaction.

Ø 2022 Executive Pay Decisions

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Ø Our 2022 Say-on-Pay Advisory Vote and Shareholder Engagement

We are pleased that 91% of the votes cast on our say-on-pay advisory vote at the 2022 Annual Meeting were in favor of our executive compensation program. The Committee continues to work diligently to ensure that our executive incentive compensation program is consistent with our philosophy, market and best practices and the feedback we receive from our shareholders. The Committee will continue to monitor the results of the say-on-pay vote to ensure continued support for our incentive pay program among our shareholders.

Shareholder engagement is a continuous process for our Board and executive management. Our dialogue with shareholders is a critical element in the evaluation of our executive compensation program and corporate governance practices. We take the shareholder engagement process seriously and act based on the feedback that we receive. We recognize that accountability to our shareholders is the cornerstone of sound corporate governance and essential to the attainment of our business objectives. The Compensation Committee considers feedback received from shareholders and carefully reviews assessments from Institutional Shareholder Services, Glass Lewis, and other external sources. As part of our shareholder engagement program each year the Board and management contact the Company’s largest shareholders – generally representing more than 44% of shares outstanding – and requested that they participate in governance outreach calls with members of our Board of Directors. Participation by the shareholder representatives is voluntary and in recent years many have expressed the view that individual governance meetings are not necessary. Accordingly, our engagement with shareholders principally involves meetings, virtual conferences, and telephone calls with shareholder representatives by members of the Company’s senior executive management. We believe that our 2022 executive pay program reflected our continuing efforts to improve the alignment of pay and performance and our alignment with peer and industry practices.

C. OUR COMPENSATION PHILOSOPHY

Our approach to executive compensation is reflected in eight guiding principles that determine the structure of our executive compensation program:

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D. THE GOVERNANCE FRAMEWORK FOR OUR COMPENSATION DECISIONS

All decisions on executive compensation are made within the context of a strong governance framework that helps ensure that the outcome is consistent with our compensation philosophy, the creation of shareholder value, and the safety and soundness of our banking operations. To that end, we use the following principles to guide the development and implementation of our executive compensation program:

Ø What we do

Ø What we don’t do

E. OUR EXECUTIVE COMPENSATION DECISION MAKING PROCESS

☐ Key Participants

Ø The Compensation Committee

Our Compensation Committee, all the members of which are independent directors under NYSE listing standards, makes decisions on the compensation of our NEOs. This responsibility is discharged within the framework of a formal committee charter, which delegates a wide range of strategic and administrative issues to the Committee. Key among the Committee’s tasks is the development of, and monitoring of adherence to, the Company’s executive compensation philosophy. The Committee is responsible for ensuring that our plans and programs comply with all regulatory directives, including consideration of the risk profile of our compensation programs to ensure that such programs do not encourage unnecessary risk taking by participants. In addition, the Committee is charged with the annual administration of our senior

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executive incentive compensation program, including the development of plan design, the selection of performance metrics, the designation of specific performance goals and award opportunities, and the certification of performance results. See, “Board Committees – Compensation Committee,” for a detailed discussion of the Committee’s responsibilities and membership. The Committee’s charter is posted on the corporate governance pages within the Investor Relations portion of our website at www.myNYCB.com.

The Committee met five times in 2022, each time including discussions in executive session without management present.

The Committee reviews the compensation of each NEO annually to evaluate whether the executive’s pay level is consistent with our compensation philosophy, risk profile, and the performance of both the Company and the individual, and whether market practices dictate an adjustment in the form or level of the executive’s compensation. As part of this annual review, the Committee considers the executive’s individual contributions to the financial success of the Company, management of subordinates, contribution to safety and soundness objectives, and their long-term potential as a senior executive.

The Committee does not delegate any substantive responsibilities related to the determination of compensation for our NEOs, and the Committee members exercise their independent judgment when they make executive compensation decisions.

Ø Timing of Executive Compensation Decisions

The Compensation Committee meets throughout the year and every meeting typically includes discussion of executive pay matters. In the months following the annual shareholder meeting, the Committee meets to consider the results of the meeting, including the say-on-pay vote and the analysis of proxy advisory firms. In addition, the Committee periodically receives input from the independent compensation consultant on emerging industry trends and best practices for executive pay. In the January-February timeframe, the Committee typically reviews benchmarking data for NEOs and outside director compensation, followed by consideration of changes to NEO base pay and the compensation structure of outside director compensation. the Committee reviews the peer group composition and makes revisions as necessary. In the March-April timeframe, the Committee reviewed and approved awards under the 2022 STIP and the settlement of LTIP awards for the three-year performance period (2020-2022), During this time, the Committee also reviewed and approved the 2023 STI and LTIP program, metrics and goals.

Ø Our CEO’s Role in the Compensation Process

Although the Compensation Committee makes independent determinations on all matters related to compensation of the NEOs, our CEO provides the Committee with his evaluation of the other NEOs’ performance and provides recommendations to the Committee regarding base salary and incentive compensation awards. However, the Committee has absolute discretion to accept, reject, or modify the CEO’s recommendations. Our CEO plays no role in, and is not present during, discussions regarding his own compensation or final decisions of the Committee regarding compensation of the other NEOs.

Ø The Independent Compensation Consultant

The Compensation Committee has retained Meridian Compensation Partners, LLC (“Meridian”) as an independent compensation consultant. Meridian works with the Committee to review our executive compensation program and assess our program relative to our performance and the market. Meridian attends Committee meetings as requested and participates in general discussions regarding executive compensation matters. While the Committee considers input from Meridian, the Committee’s decisions are the product of many factors and considerations. Management works with Meridian at the direction of the Committee to develop materials and analyses that are critical to the Committee’s evaluations and determinations. Such materials include competitive market assessments of NEO compensation and guidance on best practices and regulatory developments. Meridian also helps the Committee to identify an appropriate peer group and annually provides the Committee with comparative financial information for the peer group to establish and approve award levels under the Company’s incentive compensation program.

Meridian coordinates with the Chair of the Committee and participates with members of the Committee in executive session (without management personnel present) to discuss compensation matters. Meridian does not provide other services to the Company and has no direct or indirect business relationships with the Company or its affiliates. The Compensation Committee has considered Meridian’s independence for the 2022 fiscal year and whether its work raised conflicts of interest under the NYSE listing standards. Considering these factors, the Committee determined that the work performed by Meridian did not create any conflict of interest and that Meridian is independent of the Company’s management.

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Ø Benchmarking and Peer Group Analysis

An important element of our compensation philosophy is the analysis of our executive compensation structure and financial performance relative to a peer group of similarly sized, publicly traded financial institutions. The peer group is a key reference point as the Committee assesses the competitiveness of the executive compensation program, reviews program design features and sets compensation levels and pay mix. Our peer group is selected with the assistance of our independent compensation consultant based on objective criteria, with a focus on industry and asset size and a goal to position the company at approximately the 50^th percentile. We consider additional factors such as business footprint, business mix, comparability of revenue, market capitalization, and their status as a competitor for customers, executive talent, and investment capital. The peer group is reviewed annually and may change periodically as a result of the Company’s growth, industry consolidation, and changes in a peer company’s asset size or condition. The 16 banks included in the 2022 peer group are reflective of the Committee’s consideration of these factors.

The 2022 peer group included the following financial institutions, positioning the Company at approximately the median:

The Committee will continue to assess the universe of financial institutions to evaluate possible candidates for inclusion in the peer group. We anticipate that, in light of the significant Flagstar and Signature Bank transactions, the peer group will be evaluated in 2023 to factor in our greater size, diversified business mix and geographic footprint.

☐ Individual Performance Assessments

Our NEOs receive annual performance assessments following a process established by the Compensation Committee. Our CEO provides the Committee with an assessment of his direct reports, and the Committee, in turn, provides our CEO with an assessment of his performance and considers the CEO’s evaluation of his direct reports. While the scope of the assessment may vary from year to year, the focus of the Committee’s review is on whether the executive is meeting the functional responsibilities of the position.

F. ELEMENTS OF COMPENSATION AND 2022 PAY DECISIONS

☐ Introduction

Our NEOs participate in a competitive compensation program that emphasizes pay for performance and the creation of shareholder value. For 2022, only three NEOs (Messrs. Cangemi, Pinto and Adams) were part of the ongoing company pay program, a result of our transformative merger at year end. Messrs. Smith and Davis joined the company on December 1, 2022 with compensation arrangements that were negotiated as part of the merger. Mr. Wann did not participate in the 2022 incentive compensation program. Going forward in 2023, all NEOs will participate in the Company’s executive compensation program.

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The elements of our executive compensation program, the specific objectives for each element, and a summary of how we implemented each element in 2022 are summarized in the table below:

☐ Target Pay Mix

The Compensation Committee establishes a target pay mix for each NEO that ensures that the largest part of each NEO’s annual compensation is at risk and depends on the level of attainment of specific pre-defined performance objectives. In 2022, 78 % of Mr. Cangemi’ s compensation and 67% (on average) of the compensation of the other continuing NEOs (Messrs. Pinto and Adams) was directly linked to the performance of the Company. Mr. Wann did not participate in the 2022 incentive program. Messrs. Smith and Davis joined the Company on December 1, 2022 coincident with the Flagstar merger, and they also did not participate in the 2022 program:

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☐ 2022 Executive Compensation Program and Pay Decisions

Ø Base Salary

In early 2022, based on the independent consultant’s benchmark review, the Committee reviewed base compensation for the senior management team. The Committee considered a range of factors including (i) peer data provided by the Committee’s independent consultant, (ii) the role of each executive in the Company’s leadership team, (iii) individual performance evaluations for the prior year, (iv) the positioning of each executive’s base pay relative to other senior executives and (iv) the effect of base salary adjustments on incentive plan opportunities.

Below is a summary of the adjustments to the NEO’s salaries for 2022:

The Committee did not adjust Mr. Wann’s base salary. Mr. Smith and Mr. Davis joined the Company on December 1, 2022 in connection with the closing of the merger with Flagstar Bancorp and their 2022 base salaries were set under the terms of their employment agreements with the Company that became effective on December 1, 2022.

Ø Executive Incentive Compensation Program

Our 2022 executive incentive compensation program was maintained under applicable provisions of our 2020 Omnibus Incentive Plan (“2020 Plan”) which was approved by shareholders in 2020. In 2022, our executive incentive compensation program had two components: (i) a short-term incentive plan (STIP) performance-based cash award opportunity and (ii) a long-term performance-based award opportunity (LTIP).

☐ 2022 Short-Term Incentive Program (“STIP”)

After significant revisions in 2021, the Committee used the same plan design for our 2022 STIP. The following provides a summary of the key provisions of the 2022 STIP:

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☐ STIP Strategic/Qualitative Scorecard

The STIP included a strategic/qualitative scorecard factor weighted at 25% of the total award. The scorecard was intended to provide a more holistic assessment of the Company’s performance. The Committee did not assign a specific weight to individual scorecard items, but rather evaluated the overall scorecard results considering a range of performance from threshold to stretch (i.e., 50% to 150% payout range). The specific factors considered by the Committee are identified in the chart below referencing “Significant Considerations Identified by the Compensation Committee.”

☐ 2022 STIP Award Opportunities, Performance Results and Award Determinations

The following table show the award opportunities established by the Compensation Committee for our CEO and the other Continuing NEOs under the 2022 STIP:

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The table shows the Company’s performance goals, actual 2022 results and calculated payouts for each of the two designated financial metrics and the Strategic/Qualitative Scorecard. Pre-tax Operating Earnings of $837,861 was slightly above target and resulted in a payout of 108%. ROATA of 1.03% was slightly below target of 1.05% and resulted in a payout of 90%. The Committee devoted substantial time over several meetings assessing the factors under the Strategic/Qualitative Scorecard and rated performance at 130% of target (see detailed analysis below). Applying the weights of 50%, 25% and 25% respectively, resulted in an overall payout of 109% of target:

The following table identifies the assessment categories included in the strategic/qualitative Company Scorecard and the significant considerations identified by the Committee in each category:

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Over several meetings, the Committee reviewed, discussed and evaluated the results of the Strategic Qualitative Scorecard as summarized above. The Committee recognized the significant achievements related to the completion of the Flagstar acquisition during a challenging operating environment, efficient integration planning, systems technology preparation work, relative performance and importance of cultural transformation. While the Committee felt these achievements would typically warrant a stretch payout, they acknowledged the lag in our stock price and total shareholder return (TSR), which was partially impacted by the lengthy regulatory approval process for the Flagstar transaction. The Strategic/Qualitative Scorecard does not assign weights to any one component. The Committee, while acknowledging the overall strength of the Company relative to the 2022 scorecard factors, reduced the final scorecard rating to recognize the shareholder perspective on annual investment returns and assigned a 130% achievement level for the scorecard element.

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