March 1 (Reuters) -

* MOODY'S DOWNGRADES NEW YORK COMMUNITY BANCORP'S LONG-TERM ISSUER RATING TO B3; REMAINS ON REVIEW FOR FURTHER DOWNGRADE

* MOODY'S - ALSO DOWNGRADED TO B3 FROM BA2 FLAGSTAR BANCORP, INC.'S SUBORDINATE DEBT RATING, WHICH IS ASSUMED BY NYCB

* MOODY'S - RATING ACTION FOLLOWS NYCB'S 29 FEBRUARY FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION

* MOODY'S - NYCB'S CHANGES OCCURRING DURING CHALLENGING OPERATING ENVIRONMENT, WHICH POINTS TO HEIGHTENED ONGOING RISKS TO ITS CREDITWORTHINESS

* MOODY'S - BELIEVES THAT NYCB MAY HAVE TO FURTHER INCREASE ITS PROVISIONS FOR CREDIT LOSSES OVER THE NEXT TWO YEARS

* MOODY'S - NYCB WILL ALSO FACE HIGHER FUNDING COSTS ON INTEREST-BEARING LIABILITIES DUE TO HIGHER FOR LONGER INTEREST RATES THAT MAY PERSIST IN 2024

* MOODY'S - DOWNGRADED NYCB'S LEAD BANK, FLAGSTAR BANK'S LONG-TERM DEPOSITS TO BA3 FROM BAA2 Source text for Eikon: Further company coverage: