(Reuters) – New York Community Bancorp shares swayed between gains and losses in early trading on Friday, reeling under credit-rating cuts over its exposure to the troubled commercial real estate (CRE) sector in the United States.

The lender’s shares have lost nearly 60% of their value since Jan. 31 when it posted a surprise quarterly loss and slashed its dividend. It was last down 0.7%.

The selloff sparked worries of a global contagion as investors feared potential defaults of CRE loans would hurt the balance sheets of several regional banks, even as NYCB promised steps to bolster its financial strength.

The KBW Regional Banking Index, a key index to gauge investor sentiment toward the industry, has fallen 11.7% so far this year.

NYCB’s newly appointed executive chairman Alessandro DiNello said on Wednesday the bank will consider the sale of loans in its CRE portfolio or let them run off the balance sheet naturally.

If needed, it would also shrink its balance sheet by selling non-core assets, he said.

Morningstar DBRS on Thursday downgraded NYCB’s credit rating due to “outsized” exposure to CRE. Rating agencies Fitch and Moody’s had already cut their ratings on the bank.

“The company is also facing challenges of meeting the higher regulatory bar that comes with being a Schedule IV bank (over $100 billion in assets), while at the same time fully integrating the Flagstar Bancorp merger,” Morningstar said.

(Reporting by Manya Saini and Niket Nishant in Bengaluru; Editing by Arun Koyyur)

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