Good day, and welcome to the New York Community Bancorp, Inc. 2020 Annual Meeting of Stockholders. I would now like to turn the conference over to Joseph R. Ficalora, President and Chief Executive Officer of New York Community Bancorp, Inc. Please go ahead.
Good morning, everyone, and thank you for joining us today. I hope that all of you and your loved ones are healthy and safe during this unprecedented time in our nation's history. Given this extraordinary environment and for the health and safety of our shareholders, Board of Directors, management, and employees, we decided to hold our 2020 Annual Meeting of Shareholders via a live webcast. Despite the change in format this year, you will still be able to ask any proposal-related questions when that specific proposal is being discussed. There will also be an opportunity to respond to your other questions after I complete my formal presentation and remarks. The instructions on how to vote, change your vote, or ask a question are contained in the Rules of Order, which are posted on the website.
Before commencing with the formal business at hand, I would like to make a few comments regarding recent events. First and foremost, our immediate thoughts and prayers go out to all the individuals and communities impacted by the COVID-19 pandemic, including those members of the NYCB family, past and present, who are suffering from COVID-19, and particularly those employees, their families, and friends who have lost to this disease. I would also like to express our gratitude and thanks to the thousands of healthcare professionals and all those on the front lines. They are true heroes making sacrifices in order to help those afflicted with this disease, fighting this war on a daily basis, putting themselves at risk, and being away from their families for an extended period of time.
Obviously, the last few months have been difficult for everyone, but all of us are in this together, and together we will get through this crisis just as we have done many times in the past. I am confident that our country and our state can collectively emerge from this more united and better than before. I am joined on today's webcast by all the directors from our corporate board, as well as several directors from the boards of each of our divisional banks. I would also like to acknowledge our senior executive management team, who are also on the line with us today. I would like to personally thank all of you for your service to the company over the past year, and especially over the several months, and for continuing to represent us and the divisional banks in the communities where you live and work.
On behalf of the entire board of directors, I would like to thank you, our shareholders, for your investment in NYCB and for participating in today's meeting. Now, for today's business. First, I would like to draw your attention to the agenda, Rules of Order, and Safe Harbor Statement, which is available on the website for today's meeting. As stated in the Notice of Annual Meeting you received in the mail or read online, the purpose of today's meeting is to consider seven proposals. First, the election of four director nominees to the board of directors to serve for three-year terms of office. Second, to ratify the appointment of KPMG as our independent registered public accounting firm for the fiscal year ending December 31st, 2020. Third, to approve on a non-binding advisory basis the compensation of the company's named executive officers.
Fourth, a proposal to amend the amended and restated certificate of incorporation and bylaws of the company to eliminate the supermajority voting requirements. Fifth, a proposal to approve the New York Community Bancorp, Inc. 2020 Omnibus Incentive Program. Sixth, a shareholder proposal submitted by Kenneth Steiner requesting board action to eliminate the classified board. And seventh, a shareholder proposal submitted by Jeffrey Doppelt regarding director age and term limits. As indicated on the agenda, a discussion period will follow the presentation of each of the seven proposals. You will have the ability to ask questions online at that time. Online voting will be conducted after all seven proposals have been discussed.
Once the vote has taken place and while the proxies are being tabulated, I will review our recent results and discuss our business model, and then I will open the meeting for your general Q&A, which you can also participate in through the website. As the Rules of Order indicate, we would appreciate you limiting your questions to two per shareholder. Only shareholders as of April 7th, 2020, are permitted to ask questions during the virtual annual meeting. To ask a question, you may do so by typing it in the field provided on the website. If there are any matters of individual concern to you as a customer, I would ask that you contact John J. Fennell from our retail banking group at the following phone number: 516-683-4577, or by emailing john.j.fennell@mynycb.com.
If you have any questions about your shareholder accounts, please contact our investor relations department at 516-683-4420 or by emailing ir@mynycb.com. I would now like to call on Mr. Quinn, who is serving as secretary to today's meeting, to provide the Notice of Annual Meeting.
Mr. Ficalora, resolutions providing for the annual meeting to be held virtually at this time and date and directing that such notice be given were adopted by the board of directors of the Company. The board has fixed April 7th, 2020, as the record date to determine those persons eligible to receive notice of and to vote at this annual meeting. An alphabetical list of shareholders of record as of April 7th, 2020, showing their respective addresses and the number of shares held by each, is available online through the provided link for inspection by shareholders in accordance with company bylaws and applicable law. As of April 7th, 2020, there were 463,958,344 outstanding shares of the Company Common Stock of New York Community Bancorp entitled to vote.
A notice of meeting, proxy statement, and form of proxy or a notice of internet access to such information was duly mailed on or about April 24th, 2020, to every shareholder of record as of the April 7th record date. An affidavit of mailing prepared by Broadridge Financial, our proxy distributor and vote tabulator, will be filed with the minutes of this meeting. The board of directors has appointed Mr. Peter Descovich, an independent agent, to serve as inspector of election at this meeting. Mr. Descovich has filed with me his oath of office as inspector of election. The inspector of election has in his possession the list of shareholders entitled to vote and the voted proxies received prior to the onset of this meeting.
Thank you, Patrick. I have been advised by the inspector of election that there are present today, in person or by proxy, holders of at least 390,159,189 shares of New York Community Bancorp Common Stock. This represents more than a majority of the outstanding shares of the company's Common Stock entitled to vote at today's annual meeting. Accordingly, I declare that a quorum is present and that this meeting is duly convened. The polls for voting are now open. It is 10:12 A.M. First, if you have already voted, there is no need for you to recast your vote unless you wish to revoke or change your vote. If you have not voted, there are instructions on the website on how to cast your vote. Each proposal will be open for discussion as it is presented.
Shareholders who wish to ask questions regarding the proposals are asked to observe the established Rules of Order. Questions may be submitted in the field provided in the web portal at or before the time the matters are before the annual meeting for consideration. Please limit your questions or comments at this time to the proposal under discussion. The first proposal we will consider is the election of directors. The board has nominated board directors for three-year terms of office to expire at the annual meeting of shareholders to be held in the year 2023 or until their successors are elected and qualified. Information about the nominees' principal occupations and service with New York Community Bancorp and other pertinent matters may be found in your proxy statement. Are there any comments with respect to the nominations for director at this time?
The second proposal to be considered calls for the ratification of the appointment of KPMG LLP as the company's independent registered public accounting firm for the fiscal year ending December 31st, 2020. Representatives of KPMG are on the line today to answer any questions related to their engagement. Operator, please unmute the line to Paul Lorenzano. Mr. Lorenzano, do you wish to make a statement?
Thank you, Joe. No statement required from KPMG at this point.
Thank you, Paul. In that case, are there any comments with respect to the ratification of KPMG as the company's independent registered public accounting firm for the fiscal year? The third proposal on the agenda calls for the approval on a non-binding advisory basis of the compensation of the company's named executive officers. Are there any comments with regard to this proposal? The fourth proposal on the agenda is a proposal to amend the company's certificate of incorporation and bylaws to eliminate the supermajority voting requirements. Are there any comments with regard to this proposal? The fifth proposal on the agenda is a proposal to approve the New York Community Bancorp Inc. 2020 Omnibus Incentive Program. Are there any comments with regard to this proposal?
The sixth proposal on the agenda is being submitted by John Chevedden on behalf of shareholder Kenneth Steiner, requesting board action to eliminate the classified board by amending the company's certificate of incorporation. Mr. Chevedden, you can read your brief statement now. Operator, please unmute Mr. Chevedden's line.
Hello, this is John Chevedden. Can you hear me okay?
Yes.
This is proposal six: elect each director annually. Joe has asked that management take the steps necessary to reorganize the board of directors into one class with each director subject to election each year for a one-year term. Arthur Levitt, the former chairman of the Securities and Exchange Commission, said, "In my view, it's best for the investor if the entire board is elected once a year. Without annual election of each director, shareholders have far less control over who represents them." A total of 79 Standard & Poor's 500 and Fortune 500 companies worth more than $1 trillion also adopted this proposal topic since 2012. Annual elections are widely viewed as the corporate governance best practice. Annual election of each director would make directors more accountable and thereby contribute to improved performance and increased company value.
Adoption of this proposal would be facilitated by the adoption of the supermajority vote management proposal four, which is based on the 2019 shareholder proposal on the same topic. The 2019 shareholder proposal won 75% support at the 2019 annual meeting. The 2019 New York Community Bank proxy cited shareholder outreach of NYCB. This so-called outreach was apparently clueless by not forecasting the 75% vote against the management position. There was no report from this so-called outreach on what shareholders think of the stock falling from $19 to $10 in the past five years. New York Community Bancorp failed to cite any governance improvement as a result of its so-called outreach. NYCB directors seem to have abdicated in regard to improving the corporate governance, and shareholder proposals have taken the lead in improving the governance of NYCB.
NYCB previously had adopted shareholder proxy access due to a shareholder proposal submitted by the City of New York Office of the Comptroller. The timing is right to enhance the corporate governance at NYCB with this proposal. In less than five years, the stock has fallen from $19 to $10. It's especially important that directors stand for election annually since the presiding director, Michael Levine, was rejected by 8% of shares in 2019, double the typical director rejection vote. In spite of the leadership role of shareholder proposals, management does not believe in giving shareholder proposals a fair chance. The management statement next to this proposal is more than twice as long as the shareholder proposal. The management statement next to this proposal is so long it comes with an executive summary plus two sidebars. One sidebar even has a negative image.
Shareholder proposals have taken the lead in improving the governance of NYCB. NYCB did away with plurality voting after shareholders gave 55% support to a proposal by the California Public Employees' Retirement System. Elect each director annually, proposal six. Please vote yes.
Thank you, Mr. Chevedden. Are there any other comments related to this proposal? The seventh and final proposal on the agenda has also been submitted by our shareholder, Mr. Jeffrey Doppelt. His proposal is in regards to director age and term limits. Mr. Doppelt, can you read your statement now? Operator, please unmute Mr. Doppelt's line.
Yes. First, I want to make sure you can hear me.
Yes, we can.
Okay. To my fellow shareholders, I have submitted a proposal to address the age and tenure of each incumbent director in an effort to maintain a board that balances the fresh perspective and ideas of newer directors. My proposal is very similar to governance procedures adopted by major public companies. For example, Annaly Capital Management, in conjunction with an outside governance expert, led a full review of options to facilitate board refreshment. Following the review in October 2018, the board adopted an enhanced board refreshment policy, 12 or 73, requiring that independent directors may not stand for reelection upon the earlier of 12 years of service or their 73rd birthday. Similarly, Verizon, under the corporate governance guidelines, a director must retire from the board the day before the annual meeting of shareholders that follows his or her 72nd birthday.
And while Verizon does not have term limits for directors, the board seeks to maintain an average tenure of nine years or less for its independent directors. Non-executive directors at HSBC are typically expected to serve two three-year terms. Any term beyond six years is subject to particularly rigorous reviews by the nomination and corporate governance committee. Yet seven of the nine non-executive directors at New York Community Bancorp have served for over 12 years or in their 70s and 80s. Yet despite the fact that my proposal represents good corporate governance, the board of directors unanimously recommends that you vote against my proposal. The board believes that imposing mandatory limits on director tenure is not in the best interest of the company.
In support of this idea, the board asserts that it takes a long-term approach to generate shareholder value and that our longest-tenured directors whose terms exceed 12 years have overseen the growth of the company and continued to bring important experience and institutional knowledge to the board regarding the company and its operations. The board further states the imposition of director term limits would deprive the company of directors whose tenure has given them an important perspective on the development and implementation of the company's historical operations and long-term growth strategies. Finally, the board states that the proposal cites no evidence that the company's performance has been hampered by director age or tenure or that arbitrary limits based on director age or tenure would lead to improved results.
In the board statement in opposition from the proxy statement dated April 24, 2020, they do not tell you that on April 24, 2008, 12 years ago, the closing price of New York Community Bancorp stock was $19.21, and I'm sorry, on April 24, 2020, 12 years later, the closing price of New York Community Bancorp stock was $9.79. This represents a negative stock performance under the supposed experienced director long-term approach of almost 50%, and during the same period of time, the board has reduced the dividend from $1 to $0.68. The committee, by re-nominating the same incumbent individual directors over and over again, has not served its shareholders well.
If adopted, my proposal would not permit directors to serve more than four terms less than three years each or past their 72nd birthday. Will add new perspectives to a stale board while reasonably accommodating the competing goal of maintaining continuity and institutional knowledge. Thus, my proposal is balanced and makes sense. For all of these reasons, I urge you to vote yes for proposal seven.
Thank you, Mr. Doppelt. Are there any other comments related to this proposal? There being no further discussion, let us now proceed with the vote. If you have already cast your vote by proxy and do not wish to change your vote, there is no need to vote now. If you would like to vote now or change your vote, you can do so by following the directions on your screen. With respect to proposal number one, the election of directors, the nominations have already been presented, and no further action with respect to this proposal is required. At this time, please electronically mark your ballots with respect to proposal one. The vote will now be taken on the ratification of KPMG LLP as the independent registered public accounting firm of New York Community Bancorp for the fiscal year ending December 31, 2020.
Please electronically mark your ballots with respect to proposal two. With respect to proposal three, the vote will now be taken on the approval, on a non-binding advisory basis, of the compensation of the company's named executive officers. Please electronically mark your ballots now with respect to proposal three. Next, the vote will be taken on proposal four, which is requesting that the company eliminates the supermajority voting requirements. Please electronically mark your ballot now with respect to proposal four. The vote will now be taken on proposal five, the approval of the New York Community Bancorp 2020 Omnibus Incentive Program. Please electronically mark your ballot now with respect to proposal five. Next, the vote will be taken on proposal six, the shareholder proposal requesting board action to eliminate the classified board and the company's certificate of incorporation and bylaws.
Please electronically mark your ballot now with respect to proposal six. Lastly, the vote will now be taken on proposal seven, the approval of the shareholder proposal regarding director age and term limits. Please electronically mark your ballot now with respect to proposal seven. This completes the presentation of the proposals for voting. If you have just entered your vote electronically, please make sure that you entered your vote correctly and received confirmation that your vote was submitted. At this time, I would ask Mr. Levine to electronically submit the ballot that is being cast by the proxy committee of the board of directors.
[Uncertain] . Mr. Levine has submitted the ballot on behalf of the proxy committee of the board of directors.
Thank you, Patrick. The polls for voting on the matters before this annual meeting are hereby closed at 10:30 A.M. As in the past, during this time that the votes are being tabulated, I will discuss our business model and recent financial results. Once the presentation has ended, we will do our best to answer any questions you may have. The presentation will be shown on your screen, and it is also available on the investor relations section of our website. To begin with, slide three tells you in some detail who we are. On the lending side, we have focused over the last 50 years on multifamily lending, which for us entails lending to the owners of rent-regulated non-luxury apartment buildings, primarily within the five counties of New York City. We are one of the leading, if not the leading, originators of these types of loans.
We know this market well, having been involved in it for over five decades. During this time, we have developed a proven expertise in this business due to our long-standing relationships with the property owners that we lend to and with real estate brokers who source us the majority of the loans we originate. Traditional commercial real estate loans are a natural extension of our multifamily business and are underwritten in much the same way that we underwrite our multifamily loans. We complement our multifamily and commercial real estate loans with commercial lending, specifically specialty finance lending. We have been in this business since 2013 when we hired a group of seasoned professionals who have worked together, originating these types of loans for over 25 years with an excellent long-term track record. The portfolio has grown to about $3 billion, and we have not experienced any losses.
On the retail side, we operate over 230 locations in five states. Our retail franchise is a good source of inexpensive funding for us, which we then use to make loans. From a credit perspective, we are a conservative lender across all of our businesses. Later in this presentation, you will see how well we stack up versus the industry on credit quality. We also are a low-cost operator, and finally, our strategy has been to complement our organic growth with acquisitions. Before I go into detail about our business model and recent performance, I would like to share with you some of the actions we have taken across the organization to deal with the COVID-19 pandemic. It goes without saying that the health and well-being of our employees, customers, and shareholders is of paramount importance to management and the board of directors.
We were very proactive during this early stage of the crisis and immediately put into place our business continuity plan and pandemic planning procedures. By the middle of March, close to 100% of our back office employees were working remotely without any issues. In addition, we temporarily closed all of our in-store locations along with several other locations, converted some locations to drive-up only, and adjusted the hours at our remaining branches. On the consumer side, we have enhanced our online banking and mobile capabilities, temporarily waived certain retail banking fees, and offered 90-day payment forbearance to our residential mortgage customers. On the commercial side, we have proactively reached out to our borrowers on a case-by-case basis to help them manage through this crisis as well. We've put in place several risk mitigation strategies, including enhanced monitoring of certain loans and payment deferral options consistent with regulatory guidance.
Also, while we are not a major player in SBA lending, we are participating in the Paycheck Protection Program. The majority, if not all, of these monies were to the bank's customers or to local small businesses in our communities. None of this would have been possible without our management team and our employees. We have a veteran, experienced management team that has worked together for decades, and we have successfully navigated multiple economic cycles and business disruptions together and each have done a yeoman's job during the pandemic. At NYCB, we are not just a community bank. We are a family, and when things get difficult, our family comes together to help each other. I am extremely proud of all the efforts every employee has made to ensure that we continue to service our customers.
The last two months have been a very stressful, challenging period for everyone, and I take great pride in how the entire organization has pulled together and risen to the occasion. I would like to extend my thanks to all of our 3,000 employees throughout our franchise. Moving on, as you can see on this slide, based on all the relevant metrics: asset size, loans, deposits, and market capitalization, we are one of the largest banking organizations in the United States and also one of the largest regional banks in the New York metro market. Even though we are one of the largest banks in the country, we do not have all the risks that other large banks have. As depicted on this slide, we consistently lead the industry in credit performance. No matter how you look at it, over various cycles, we have produced impressively low loan loss rates.
Since we went public in 1993, our cumulative losses are about 1% compared to 23.5% for the industry and 12.5% compared to our peers. The next slide highlights our current franchise. We have grown from seven branches in Queens at the time of our IPO to over 230 branches as of today. Outside of New York and New Jersey, we have locations in Ohio, Florida, and Arizona, which we entered through FDIC-assisted deals during the last financial crisis. All of our markets we operate in have attractive demographics and are strong banking markets, which have helped us grow our deposits significantly over the last two years. The next slide is a snapshot of our first quarter 2020 performance compared to the first quarter 2019. It was a noisy quarter due to COVID-19 and the adoption of a new accounting policy for loan losses.
But as you can see, our results are very solid, all things considered. We had year-over-year growth in net income and diluted earnings per share, largely driven by loan growth and a lower cost of funding, which should continue throughout the rest of this year. I would also like to point out that as a liability-sensitive bank, that is, a bank whose liabilities reprice quicker than our assets, we are a main beneficiary of the Federal Reserve having lowered interest rates to near zero. At the same time, the yields on our new loans are holding relatively steady as credit spreads have widened due to less competition. Moving next to our capital position. As you can see, our capital levels are very strong, given that we have virtually zero loan losses, and they compare very favorably to both our peers and our industry as a whole.
We believe that these ratios more than adequately protect our balance sheet, and I would also point out that we have never taken a large credit-related loss against capital, unlike the rest of the industry, which suffers large losses over various cycles. Turning now to our loan portfolio. Our loan portfolio is very low risk, with the majority of the loans being in our primary multifamily lending niche. As I mentioned, we are the primary lender in this field with over 50 years of experience and deep industry relationships. Diving a bit deeper into this portfolio, multifamily loans currently stand at about $32 billion, representing 74% of our overall portfolio, and almost all of these loans are in the greater New York City market. The average principal balance is about $6 million, and they have a short-weighted average life of 1.9 years.
60% of the multifamily portfolio, or $18.7 billion, are subject to New York State rent regulations, and these loans have a weighted average loan-to-value ratio of 53% compared to 57% for the overall multifamily portfolio. Moreover, we have not seen a meaningful impact on rent collections in this portfolio from COVID-19. Rent collections are at 85% or better during the second quarter. So you can see that we are well insulated against a decline in property values, which to date we have not seen. Turning now to our commercial real estate portfolio. This is another low-risk business and logical extension of our multifamily business. Today, this portfolio stands at $7 billion, or about 17% of total loans. As with our multifamily portfolio, almost all of the loans are in the New York City metro area.
The average principal balance is $6.6 million, and the weighted average life is just over two years. COVID-19 is having some impact on this portfolio, specifically in the retail office sectors, which is logical given the shutdown. However, we have very low loan-to-value ratios and high debt service coverage ratios in this portfolio, which should mitigate the impact. The third major component of our loan portfolio is our specialty finance business. This is a relatively new business for us, but not for the team we hired at the end of 2013. This team has been working together for over 25 years, mostly at larger financial institutions in the Northeast, and is composed of six industry veterans with nearly 150 years of combined experience in secured lending, credit, transaction structuring, and risk management.
One of the main reasons we hired this particular group of people is their conservative underwriting and their excellent history with regard to credit losses, which is similar to our loss history on multifamily and CRE lending. We view this as an attractive business in other ways as well. In addition to providing us with low-risk assets with appropriate returns, it also adds a level of diversification and helps our interest rate risk profile due to the variable rate feature of most of these loans. Nothing speaks louder about the durability of our business model over multiple business cycles than the next few slides. We are the industry leader in credit performance among all banks in the country, be they large banks, regional banks, or community banks. This slide depicts our non-performing loans as a percentage of total loans going back to 1993 when we came public.
As you can see by the gold-shaded bars, we have performed consistently better than the industry during the best of times and, more importantly, during the worst of times. At the same time, very little, if any, of our non-performing loans translate into actual losses. Look at the gray bars in this slide, which represent industry losses, and look at the gold bars, which represent NYCB. You may have to squint a little bit to find our gold because we had zero to minimal losses since 1993 compared to the industry. All of this results in this slide, which shows our consistent profitability over various business cycles. On this slide, you do see a lot more gold because we have outperformed our peers over the long run. We tend to perform better during industry downturns due to our tried-and-true business model.
Specifically, if you look at the last major downturn from 2007 to 2010, not only did we remain profitable while the rest of the industry was either barely profitable or losing money, we actually became more profitable. Moving now to our expenses. We have always operated a low-cost business model. At March 31st, 2020, our efficiency ratio was 48%, which means simply that it costs us 48 cents to generate $1 of revenues. It costs our peers nearly 56 cents to generate that same $1 in revenues. While many banks would be happy with a 48% efficiency ratio, this ratio is high for us compared to historical standards. While there are many reasons to explain why our efficiency ratio is above historical norms, over the last several years, we have reduced our operating expenses by about $160 million from their peak, or about 25%.
We expect to be able to run the company with our operating expenses in the low $500 million range over the foreseeable future. Turning now to our deposits. We are pleased with our deposit growth over the last two years, whereby deposits grew by over $1 billion in both 2018 and 2019. This trend continued into the first quarter of 2020 as deposits increased $316 million, or 4% on an annualized basis. This next slide summarizes our earnings growth strategy. It is comprised of three levers. First, we will grow our loan portfolio by mid-single digits. Second, we expect double-digit improvements in our net interest margin driven by a significant downward repricing in our funding costs. And third, we expect our operating expenses to be contained. Next, as I mentioned at the beginning of this presentation, we complement our organic growth with acquisitions.
This has been and continues to be a core part of our business model. Since going public in 1993, we have closed on 11 strategic transactions, essentially completing one per year from the year 2000 to 2010. Our acquisition strategy focuses primarily on the funding side of the balance sheet and not necessarily the asset side. We like to partner with like-minded companies and management teams with solid franchises in good retail banking markets. We will look at the asset side if it is a unique opportunity to complement our existing loan portfolio. Importantly, from a financial perspective, acquisitions need to be accretive to tangible book value and accretive to earnings. Lastly, this slide shows our total return on investment, including dividends, since our IPO has compared to the rest of the banking industry, as well as the S&P 500.
As of March 31st, 2020, our total return on investment was 3,375%. While this is down from its highs, it is still ahead of our peers and the S&P 500 by a large measure. I will now open the floor to your questions. Since we are webcasting today's meeting, you can ask your questions via the website by entering your control number to verify your identity and then typing in your question into the field provided. To ensure that everyone with a question has the opportunity to ask it, I would appreciate your being mindful of the rules of order. We will do our best to get to all of your questions within the time allotted. Again, if your questions or comments are regarding your shareholder account or your customer account, please contact either the investor relations department or our retail banking group at your convenience.
And now I will be happy to take your questions.
Excuse me, this is the conference operator.
Yes.
Yes, sir. Is there anyone whose line you would like me to open at this time, sir?
Are we going to have the others ask the question?
I think we're waiting for any questions to come through the internet site. Mr. Ficalora, I don't know if there are any questions that have come through. If there are, I think they need to be read and then answered, those that have been presented.
I apologize for the time delay. We are accumulating the questions. We'll establish a means of communicating with you the question, and then I will answer it.
Mr. DiMartino, your line is open, sir.
Thank you, operator. Mr. Ficalora, we have several questions from shareholders.
The first question, a shareholder wishes to know about the sustainability of the company's dividend going forward.
Well, that is actually a question that's extraordinarily important to all of the members of the board and management, and over the course of our entire public life, we've always felt that a strong dividend was an appropriate means of returning value to shareholders, so over that life, we've been one of the best providers of a dividend, and we have every expectation to continue to be so. I would share that as we see the future period, our dividend is better suited to be paid than it had been in the more recent past.
The next question that we have is on the company's M&A strategy. Several shareholders wish to know if you expect M&A activity for the company to increase once the COVID-19 pandemic subsides.
They also wish to know if all previous M&A transactions have been accretive to tangible book value. And outside of tangible book value, what other metrics would shareholders look at to see if deals are accretive? And finally, one shareholder wishes to know what regions of the country would we want to expand in that would complement the multifamily business?
Well, I'll start with the last part of the question first. We are not seeking assets in other geographies. The good news is that despite the size of our presence in the New York market, it is gigantic, and there's more than adequate assets for us to generate in the world that we know. The outside tangible book value is, in every transaction that we execute, always accretive. We do accretive deals. Our deals have always added value to shareholders.
It's not the price so much as it is the actual value created. Our price has changed over the 25 years that we're a public company. But our total return to shareholders, which is the relevance of our price and our dividend, is well over 3,300 plus %. There are no banks that we are aware of that have had, in a 25-year horizon, that significant return to shareholders. It's not the actual dollar value, which is a consequence of the number of outstanding shares as well as other factors. It's the value created for the investment. Over the course of our entire public life, the total return for being a shareholder is overwhelmingly the best, well over 3,300%. Over the course of the most immediate period, that may be different.
As a result of activities, or more important in our case, our inability to act, we are a bank that creates great value by buying banks. We have not been able, for a variety of reasons outside of our control, able to buy banks. Surely, as we are poised today, we are going to resume acquiring banks. It's not a matter of the region of the country or the structure of the bank. All interpretations necessary to add shareholder value are made by us before we buy a bank. We never would do a transaction that was not going to result in benefit to our shareholders. The only reason we do transactions is because we can create greater value for shareholders. All of the transactions we have executed have created greater value for shareholders.
Okay. The next question we have is on multifamily lending. Shareholders wish to know how the bank is navigating the political landscape in New York City regarding rent-regulated multifamily apartment buildings. Given the change in the rent regulation rules, will we consider diversifying into other types of lending?
The unfortunate reality is that this is a typical example of government interceding into the private sector on behalf of one constituency at the burden of another. There is no constitutional justification for government to take rights away from an owner and give them to a tenant. There are many rules and laws and regulations that have been passed inappropriately over the course of time that do that. They explicitly change the rights of citizens where they favor one citizen over another. We're not talking about the breaking of common law.
We're talking about setting rules or priorities that give economic benefit to one citizen over another citizen because of political reasons. That is not new news. And some of the current activity is quite as inept as previous political intervention into the private sector. In this case, the people who are most impacted, the property owners themselves, are in fact exercising their rights to try and establish that they have the right in a free market to charge the rent that the market will bear. And the market should be deciding the rent, not a politician. So the effort to accomplish this is ongoing. The consequence to us to date has not been in any way significant.
The buildings that we lend on are very conservatively priced, appraised, and lo and behold, even with the change in hand, we have the capacity to reasonably expect that the rent rolls in our buildings will cover the costs and benefits of running that building. So we've had no noticeable to date adversity from the changes which are being discussed. The reality is that our buildings continue to be in the higher 80 percentile performing. The payments are being received. The speculation by others that tenants can't pay their rent may be true in some places, may be true with regard to a majority of the higher-end buildings, but have not been evident in our unique relationships or in the payment stream that we enjoy.
Our next question, Mr. Ficalora, comes from the Cooperative Union Pension Funds. They would like to know about our share buyback activity.
In their question, they noted that we bought back some stock in the first quarter of 2020. And they'd like to know that given that liquidity is especially important in uncertain markets, has the company suspended the current share repurchase program? And if so, what factors would we consider when to start repurchasing shares again?
As is evident over the course of long periods of time, we have significantly better liquidity than the banking sector, in particular during periods of crisis. So our liquidity, our ability to buy stock, has been proven to continue even during periods of stress because we continue to get our payments. So our loan portfolio performs on a distinguishably better basis compared to our sector during periods of stress. So even during periods of stress, we've been able to lend more dollars. We actually have greater liquidity.
We actually have a performance metric that is significantly beyond the industry activity. So when you think through the many years that we've been public and the troubles that might have occurred in the 2008 to 2010 period, our performance metrics were fine. Our liquidity was fine. So the distinctions between us and our sector actually widen. We are actually better on a relative basis during periods of stress. And during those periods, we actually are capable of making even better loans because there are fewer and fewer competitors able to compete with us in our market.
Then our next question has to do with our specialty finance business. I think we already mentioned how big that portfolio is. But a shareholder wishes to know how quickly we can grow that, what kind of growth we expect to see in that portfolio on a go-forward basis, and do we expect to see any sort of meaningful credit losses in that portfolio.
One of the things that made it possible for us to decide to be in that business is, in fact, the expertise and consistency of the team that we have in place executing on those loans. They have a long-term, 25, 35, long-term experience in dealing with the best of times and the worst of times. As we do, they have a real track record of no loss or less loss during periods of stress. And lo and behold, the numbers are discernible, and we've verified them before we ever hired a single one of the people that we depend upon for this product.
We're not talking about a business that is only good in the best of times and terrible in the worst of times. The way we execute this business, we actually get through periods of stress with little to no loss. And it's hard to imagine, but the loss metrics over the course of 25 years, which all of us know had periods of stress, the loss metrics for this team, for this product, is in fact comparable to our losses. It was so impressive for us to see another lending team policy practice that could generate such favorable metrics. We're not talking about a maybe. We're talking about decades of performance in the face of adversity. So the tested and true methods that we follow are genuinely discernible and expected to be replicable.
Okay. And then we have a final question. It's actually two related questions. This is regarding the bank system conversion. Shareholders like to know, will the new system result in a substantial cost savings to the bank and an improvement in the efficiency ratio going forward, and will bank customers see any noticeable differences?
Is our expectation that all three of those priorities are in the decision process that led us to go through this change? It is clear that a change of this significance takes a significant effort on the part of our people and has a genuine cost to execute. We have weighed the benefits against the burden and have come to the conclusion that this is well beyond reason for us to do the conversion. Our services to our customers will be enhanced by the new environment. Our controls over our risks will be enhanced by the new environment.
The speed with which we can get information or execute on unique transactions will be enhanced by the new environment. So for many good reasons, we're going through a substantive, costly effort, all justified by our discernible expectation of the new environment being better than the existing environment. We're very pleased that we have the opportunity and the resources, both intellectual and financial, to make this happen. The outcome will be appreciated by our depositors.
Okay. That was the last question, Mr. Ficalora.
And Mr. Ficalora, I understand that the vote tally is complete.
Thank you, Patrick. Mr. Descovich, will you please present your report on the vote? Operator, please unmute the line to Mr. Descovich.
Thank you, Mr. Ficalora. The preliminary results of the voting are as follows. With respect to proposal number one, all four nominees have been duly elected by a majority of the votes cast.
With respect to proposal number two, the appointment of KPMG LLP as independent registered public accounting firm for the fiscal year ended December 31st, 2020, has been ratified. With respect to proposal number three, a majority of the votes cast were voted for the compensation plan for the company's named executive officers. Therefore, proposal number three has been approved. With regard to proposal number four, pertaining to the elimination of the supermajority voting requirements, the required percentage of shares voted for this proposal was not obtained. Therefore, proposal four has not been approved. As for proposal five, regarding the approval of the company's 2020 Omnibus Incentive Program, a majority of the votes cast were voted for this proposal. Therefore, proposal five has been approved. Regarding proposal number six, regarding elimination of a classified board, a majority of the votes cast were voted for this proposal.
Therefore, proposal number six has been approved, and finally, regarding proposal number seven, regarding director age and term limits, a majority of the votes cast were voted against this proposal. Therefore, proposal number seven has not been approved. My final report and certificate as inspector of election will be executed and delivered to the secretary of this meeting within 24 hours so that the final vote results can be included in a Form 8-K that the company will file with the SEC.
Thank you. The preliminary report of the inspector of election, as presented, is accepted. We appreciate all of your support this year. With respect to proposal six, I will ask the board to consider the outcome of today's vote when it next meets. Mr. Quinn, please safeguard the ballots, proxies, and oath and certificate and report of the inspector of election and maintain them among the records of the company. On behalf of the board of directors, I thank you again for joining us today and for your investment in New York Community Bancorp. This meeting is now adjourned.
The conference has ended. You may disconnect your line.