Flagstar Bank
Corporate brand
UnclaimedFlagstar Bank was a Michigan-based commercial bank and major U.S. mortgage lender that operated under the Flagstar name from 1996 until its acquisition by New York Community Bancorp in 2022. US national bank
Last updated October 16, 2026
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Overview
Flagstar Bank was an American commercial bank headquartered in Troy, Michigan, whose historical corporate identity ran from its origins as First Security Savings Bank in 1987 through its acquisition by New York Community Bancorp on December 1, 2022. The institution developed from a federally chartered savings bank focused on regional retail and wholesale mortgage funding into a diversified banking organization serving consumers, businesses, mortgage intermediaries, and institutional counterparties. The bank’s original business was closely tied to residential mortgage finance. First Security Savings Bank was established in 1987 under the leadership of Thomas J. Hammond. FSSB Holding Corporation was formed in 1993, and the holding company expanded through the 1994 acquisition of Security Savings Bank of Jackson, Michigan. In 1996, the organization adopted the Flagstar Bank name, establishing the brand used during its subsequent expansion. Flagstar Bancorp went public through an initial public offering in 1997 and moved its common-stock listing from NASDAQ to the New York Stock Exchange in 2001. Flagstar’s activities extended beyond branch banking. Its business included consumer deposits and loans, commercial banking, small-business finance, mortgage origination and servicing, wholesale mortgage lending, warehouse lending, and related financial services. Mortgage finance remained the defining part of its profile, but the bank also pursued branch acquisitions and commercial-credit transactions to broaden its geographic reach and revenue base. In 2013, it sold a commercial loan portfolio to CIT Group. In 2018, it purchased branches from Desert Community Bank in San Bernardino County, acquired a mortgage warehouse loan portfolio from Santander Bank, and acquired branches from Wells Fargo in Indiana, Michigan, Ohio, and Wisconsin. The 2008 financial crisis was a major turning point. Flagstar raised approximately $1.6 billion in new capital through investments associated with MP Thrift Investments, the U.S. Troubled Asset Relief Program, and public offerings. The bank also carried out one-for-ten reverse stock splits in 2010 and 2012 in an effort to maintain its New York Stock Exchange listing. The U.S. Treasury sold its preferred stock in Flagstar to private investors in 2013, and Flagstar repaid all TARP funds in August 2016. The institution also faced extensive legal and regulatory scrutiny related to mortgage underwriting and residential mortgage-backed securities. Settlements and judgments involving MBIA, Assured Guaranty, Fannie Mae, Freddie Mac, and the Consumer Financial Protection Bureau reflected disputes over mortgage representations, repurchase obligations, and servicing or consumer-finance practices. In February 2012, the U.S. Department of Justice sued Flagstar over alleged improper approval of federally insured residential mortgage loans. A federal court later found that Flagstar had materially breached contractual requirements concerning loans packaged into securities. Flagstar maintained a strong Michigan community presence. In 2016, it announced a five-year, $10 million economic-development initiative for Pontiac, including mortgage support, small-business and startup financing, investment in the Flagstar Strand Theatre for the Performing Arts, and financial-literacy funding. The bank also became the Detroit Pistons’ jersey sponsor for the 2017–18 NBA season. A technology disruption during the 2018 Wells Fargo branch conversion caused customer-service problems, leading Flagstar to waive fees, add staff, and establish a dedicated customer-contact channel. New York Community Bancorp announced an all-stock strategic merger with Flagstar Bancorp on April 26, 2021. The transaction closed on December 1, 2022, ending Flagstar Bank as an independent historical banking organization. The Flagstar name was subsequently retained and expanded across the acquiring company’s branch network, but those later developments belong to the post-2022 Flagstar organization rather than the canonical 1987–2022 entity covered here. Flagstar maintained a strong community presence in Michigan. In 2016, it announced a five-year, $10 million Pontiac economic-development program that included mortgage support, small-business and startup financing, investment in the Flagstar Strand Theatre for the Performing Arts, and financial-literacy funding. The bank also became the jersey sponsor of the Detroit Pistons for the 2017–18 season. Technical disruptions during the 2018 Wells Fargo branch conversion caused customer-service problems, and Flagstar responded by waiving fees, adding staff, and establishing a dedicated customer contact channel. The company initiated a dividend in 2019.
History
Flagstar Bank began in 1987 as First Security Savings Bank, a federally chartered savings institution established under the leadership of Thomas J. Hammond. Its early business centered on funding retail and wholesale mortgage operations in the regional market. FSSB Holding Corporation was created in 1993 as the bank’s holding company, and the organization expanded in 1994 by acquiring Security Savings Bank of Jackson, Michigan. The organization adopted the Flagstar Bank name in 1996. It completed an initial public offering in 1997, giving Flagstar Bancorp access to public equity markets, and transferred its stock listing from NASDAQ to the New York Stock Exchange in 2001. During this period, Flagstar combined branch banking with a substantial mortgage-lending platform. Its activities included residential originations, wholesale and correspondent lending, servicing, consumer banking, commercial credit, and mortgage warehouse finance. The financial crisis of 2008 placed significant pressure on Flagstar and the broader mortgage industry. The company raised about $1.6 billion in capital through private investment, TARP participation, and public offerings. It later completed one-for-ten reverse stock splits in 2010 and 2012 to support continued NYSE listing. The Treasury sold its preferred Flagstar stock to private investors in 2013, and Flagstar fully repaid its TARP funding in August 2016. Mortgage-related litigation and regulatory actions became a defining part of the bank’s post-crisis history. Flagstar paid a $93.5 million settlement to Fannie Mae in 2011 and an $110 million settlement to MBIA in 2013. It also reached a $105 million settlement with Assured Guaranty in 2013 and paid Freddie Mac $8.9 million concerning mortgage repurchase obligations. In 2014, Flagstar agreed to pay $37.5 million to the Consumer Financial Protection Bureau. Separately, the Department of Justice filed a 2012 complaint alleging that the bank had improperly approved thousands of residential loans for government insurance. A federal court later found that Flagstar materially breached contractual standards governing loans packaged into securities. The bank pursued portfolio management and geographic expansion during the 2010s. In 2013, it sold a $1.3 billion commercial loan portfolio to CIT Group. In 2018, it acquired eight Desert Community Bank branches in San Bernardino County, a mortgage warehouse loan portfolio from Santander Bank, and 56 branches formerly operated by Wells Fargo across Indiana, Michigan, Ohio, and Wisconsin. The Wells Fargo conversion generated customer complaints after website and transition problems. Flagstar waived fees, increased staffing, and offered a dedicated email channel to address affected customers. Flagstar also invested in its Michigan community identity. In 2016, it announced a $10 million, five-year Pontiac economic-development program. The plan included mortgage financing, capital for small businesses and startups, support for the Flagstar Strand Theatre for the Performing Arts, and financial-literacy funding. Its consumer-facing visibility increased through a jersey sponsorship of the Detroit Pistons during the 2017–18 NBA season. The company initiated a dividend in 2019. On April 26, 2021, New York Community Bancorp announced an all-stock merger with Flagstar Bancorp. The transaction closed on December 1, 2022. This ended the independent 1987–2022 Flagstar Bank organization documented by the canonical article. The acquiring organization subsequently used the Flagstar name for its branch network and later adopted Flagstar-related corporate naming, but those developments should be treated as the history of the successor organization rather than as part of the defunct historical entity.
- 2022
Independent Flagstar organization acquired
[1]The acquisition by New York Community Bancorp closed on December 1, ending the historical entity’s independent operation.
- 2021
Merger announced with New York Community Bancorp
[1]New York Community Bancorp announced an all-stock strategic merger with Flagstar Bancorp.
- 2016
TARP funds fully repaid
[1]Flagstar completed repayment of the funds it had received through TARP.
- 2013
Treasury preferred stock sold
[1]The U.S. Treasury sold its preferred stock in Flagstar to private investors.
- 2008
Crisis-era capital raising
[1]Flagstar raised approximately $1.6 billion through private investment, TARP participation, and public offerings.
- 2001
Stock listing moved to NYSE
[1]Flagstar moved its stock listing from NASDAQ to the New York Stock Exchange.
- 1997
Initial public offering
[1]Flagstar Bancorp became a publicly traded company.
- 1996
Flagstar name adopted
[1]The company changed its name to Flagstar Bank.
- 1994
Security Savings Bank acquired
[1]The organization acquired Security Savings Bank in Jackson, Michigan.
- 1993
Holding company established
[1]FSSB Holding Corporation was formed to serve as the bank holding company.
Products and positioning
A regional American bank with a strong mortgage-finance heritage, combining retail and commercial banking with wholesale lending, mortgage servicing, and community-development initiatives.
Mortgage banking · 1987
Residential mortgage lending
Residential mortgage finance was the central business associated with Flagstar. The bank originated and funded home loans through retail, wholesale, and related channels, and its history included substantial exposure to mortgage representations, repurchase obligations, government-insurance requirements, and residential mortgage-backed securities.
Mortgage banking
Mortgage servicing
Flagstar’s mortgage platform included servicing activities connected with residential loans. Servicing formed part of the institution’s broader mortgage-finance model and contributed to its relationships with borrowers, investors, government-sponsored enterprises, and mortgage-insurance counterparties.
Retail banking · 1987
Consumer banking
The bank operated consumer branches and offered deposit and lending services to individuals. Its retail footprint expanded through branch acquisitions, including locations obtained from Desert Community Bank and Wells Fargo in several Midwestern and Western states.
Commercial banking
Commercial banking
Flagstar served businesses through commercial loans and related financial services. The institution managed commercial-credit portfolios and in 2013 sold a $1.3 billion commercial loan portfolio to CIT Group as part of its balance-sheet strategy.
Wholesale finance
Mortgage warehouse lending
Mortgage warehouse lending provided short-term financing to mortgage originators and supported Flagstar’s wholesale mortgage ecosystem. In 2018, the bank acquired a mortgage warehouse loan portfolio from Santander Bank, reinforcing this specialist capability.
Controversies
2014
Consumer Financial Protection Bureau settlement
Flagstar agreed to pay a settlement to the Consumer Financial Protection Bureau in connection with consumer-finance and mortgage-servicing-related matters.
2013
Mortgage-backed-securities and repurchase settlements
Flagstar reached or paid settlements involving MBIA, Assured Guaranty, Fannie Mae, and Freddie Mac concerning mortgage representations, residential mortgage-backed securities, and loan repurchase obligations.
2012
Federal mortgage-insurance lawsuit
The U.S. Department of Justice sued Flagstar, alleging that the bank improperly approved thousands of residential mortgage loans for government insurance. The litigation became part of the institution’s broader post-crisis mortgage-underwriting record.
Marketing campaigns
- 2017Detroit Pistons jersey sponsorship
Detroit metropolitan area · United States
Flagstar became the jersey sponsor of the Detroit Pistons for the 2017–18 NBA season, giving the Michigan-based bank prominent sports and regional brand exposure.
- 2016Pontiac economic-development initiative
Pontiac, Michigan
Flagstar announced a five-year, $10 million program intended to support Pontiac’s economic revitalization. The initiative combined customized mortgage financing, funding for small businesses and startups, support for the Flagstar Strand Theatre for the Performing Arts, and financial-literacy investment.
Brand decisions
2021
All-stock merger with New York Community BancorpM&ABackground
Flagstar pursued a strategic combination with another U.S. regional banking organization.
Action taken
New York Community Bancorp announced an all-stock acquisition of Flagstar Bancorp on April 26, 2021.
Aftermath
The transaction closed on December 1, 2022, ending Flagstar Bancorp’s independent corporate existence.
2018
Branch and warehouse-lending expansionStrategyBackground
Flagstar sought to expand its geographic branch network and strengthen mortgage-wholesale infrastructure.
Action taken
The bank acquired eight Desert Community Bank branches, a mortgage warehouse loan portfolio from Santander Bank, and 56 Wells Fargo branches across Indiana, Michigan, Ohio, and Wisconsin.
Aftermath
The Wells Fargo conversion experienced website and customer-service problems. Flagstar waived fees, added personnel, and established a dedicated contact channel while stating that most issues had been resolved by the end of the week.
2013
Sale of commercial loan portfolio to CIT GroupStrategyBackground
Flagstar adjusted its balance sheet and commercial-credit exposure during its post-crisis restructuring period.
Action taken
The bank sold a commercial loan portfolio with a reported value of $1.3 billion to CIT Group.
Commercial loan portfolio sold. $1.3 billion portfolio transferred (2013)
Recent events
Reported
Stavvy and Flagstar Bank announce alliance for remote loan modifications[2]
Stavvy announced an alliance with Flagstar Bank to provide remote loan modification services.
Reported
Flagstar and New York Community Bancorp announce merger[3]
Flagstar Bancorp announced it would combine with New York Community Bancorp in an all-stock merger valued at $2.6 billion. The merger was expected to close by year-end; the Flagstar Bank brand would be maintained in the Midwest and for the Flagstar mortgage division.
Reported
Flagstar launches “The Human Interest Rate” campaign[4]
Flagstar Bank announced the launch of its “The power of the Human Interest Rate” marketing campaign, featuring television, digital, outdoor, print, and radio advertising, along with customer stories and testimonials.
Sources5 sources
- 1Flagstar Bank (1987–2022)en.wikipedia.org
- 2Stavvy与Flagstar Bank宣布远程贷款修改合作bankerandtradesman.com
- 3Flagstar与纽约社区银行宣布合并wxyz.com
- 4Flagstar 推出“人文利率”营销活动prnewswire.com
- 5Stavvy Announces Over $40 Million in Series A Financing, Partners with Flagstar Bank to Provide COVID Loan Relief to Consumersnewyorktelegraph.com
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