Sep. 11, 2014, 2:48 PM
- Now part of M&T Bank (MTB +0.6%), Wilmington Trust agrees to pay $18.5M to settle SEC charges it failed to disclose more than $330M of non-performing real-estate related loans on its books in Q3 and Q4 of 2009, and then continued to materially misreport the loans in 2010 H1.
- Wilmington agreed to sell itself at a bargain price to M&T Bank in 2010.
- It's unclear how this might affect M&T's hoped-for purchase of Hudson City Bancorp (HCBK +0.6%), but it surely won't help as regulators have held up the deal due to concern about M&T's internal controls, especially as they concern money laundering.
Aug. 27, 2014, 1:10 PM
- "It's clearly not helpful to poke your primary regulator in the face with a stick," says an investment banker who works on bank acquisition deals. He's referring to 80-year old M&T Bank (MTB -0.1%) boss Robert Wilmers. After guiding his bank through the financial crisis without cutting the dividend or reporting a quarterly loss, Wilmers has been critical of regulatory overreach, arguing smaller lenders are suffering for the mistakes of the TBTF banks.
- Today marks the 2-year anniversary of the M&T/Hudson City (HCBK -0.4%) merger announcement, a deal which continues to be held up because of Fed concerns over M&T's money-laundering compliance, but maybe regulators are just making an example of Mr. Wilmers.
- In any case, the 2-year and counting delay has put a chill on the merger market for banks. Since the beginning of 2013, at least 10 lenders hoping to complete deals have instead been forced to move back planned closing dates. Among those, ViewPoint Financial (VPFG -0.3%) has a merger agreement expiring this weekend, and BancorpSouth (BXS -0.3%) dropped its request to buy two banks earlier this month after weaknesses were found in its money-laundering program (it plans to refile for approval after cleaning this up).
- For its part, M&T has spent vast quantities trying to come into compliance and at latest check is still hopeful on closing the purchase before year's end.
- ETFs: XLF, FAS, FAZ, UYG, VFH, IYF, SEF, IYG, FXO, FNCL, FINU, RWW, RYF, FINZ
Jul. 23, 2014, 9:10 AM
- Net income of $39.2M or $0.08 per share vs. $48.7M and $0.10 one year ago. Quarterly dividend of $0.04 declared.
- Net interest income of $42.2M falls 26% Y/Y, with NIM of 1.29% tumbling 35 basis points.
- Noninterest income of $21.2M rises from $9.6M, boosted by $19.5M in gains from sale of $565.6M of MBS (gains were $7.2M in Q2 one year ago).
- Noninterest expense of $73.1M vs. $76.6M one year ago, thanks to a $6.5M decrease in Federal deposit insurance costs (as balance sheet shrunk). Compensation and employee benefit costs were about flat.
- No loan loss provision vs. $12.5M provision one year ago.
- Efficiency ratio of 52.65% deteriorates from 45.22% a year ago. Tier 1 leverage capital ratio of 11.26% up from 10.82% at start of year.
- HCBK continues to mark time as it awaits approval for its purchase by M&T Bank.
- Previously: Hudson City Bancorp beats by $0.01, beats on revenue
Jul. 23, 2014, 8:06 AM| Comment!
Jul. 22, 2014, 5:30 PM
May. 14, 2014, 10:17 AM
- Among those started at Buy is M&T Bank (MTB -0.9%), with analyst Bill Carcache noting the usually strong performer has lagged over the past 16 months amid regulatory issues and the delay of the Hudson City Bancorp (HCBK -1%) acquisition. Carcache expects approval this year, along with meaningful operating efficiency improvements. "We believe MTB shares are trading at a significant discount to their intrinsic value and expect to see meaningful share price appreciation through 2015."
- Also a Buy is Wells Fargo (WFC -0.8%), with Carcache seeing the bank as well-positioned if the economic recovery remains muted thanks to a combination of fee income and expense control.
- Started at Reduce with $40 price target is Comerica (CMA -1.7%), with Carcache saying the stock price has gotten ahead of itself.
- See also: More on Nomura's wide-ranging new bank coverage
May. 12, 2014, 9:53 AM| Comment!
Apr. 29, 2014, 8:24 AM
- Net income of $42.5M or $0.09 per share vs. $47.9M and $0.10 one year ago. Quarterly dividend is $0.04.
- Net interest income falls 25.4% Y/Y to $132.3M, with net interest margin of 1.41% from1.8%. Bank is also pulling back its horns a bit amid worry about higher rates at the long end. "We continue to carry an elevated and increasing level of overnight funds since we do not want to invest in longer duration assets at these low interest rates."
- Noninterest income of $17.8M up from $2.5M thanks to a big gain-on-sale of MBS. Noninterest expense of $79.7M falls from $81.3M.
- Tangible book value per share of $9.29 up from $9.21 at end of 2013. Tier 1 leverage ratio of 11.03% up from 10.82%.
- Source: Press Release
- Previously: Hudson City Bancorp beats by $0.02
- HCBK no trades premarket
Apr. 29, 2014, 8:06 AM
Apr. 28, 2014, 5:30 PM
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Apr. 24, 2014, 7:15 AM
Feb. 19, 2014, 7:12 AM
Feb. 3, 2014, 1:40 PM
- M&T's (MTB -1.4%) purchase of Hudson City Bancorp (HCBK -1.2%) - first announced in August 2012 - has been stuck in a regulatory morass, with D.C. insisting M&T beef up its money-laundering compliance before approval is granted.
- The numbers that day in August assumed an 18% IRR on the purchase for M&T, but updating his team's model, Citi's Keith Horowitz calculates it to be closer to 20% thanks to the increase in M&T's stock price and Hudson City's better position today - its quarterly expense run rate in 13% lower, the balance sheet is 11% smaller which offsets the higher deal cost by improving the capital ratio. Horowitz expects the deal to add 3% to M&T's EPS, improving to 7% within a couple of years.
- Horowitz, however, rates M&T at just a Neutral given the risks to the stock due to its premium valuation - it trades at 4.1x tangible book vs. a "normal" of 2.5x.
Jan. 29, 2014, 10:08 AM
- "We believe market interest rates still remain too low to compel us to pursue any balance sheet growth in the near-term," says Hudson City Bancorp (HCBK +0.9%) CEO Ronald Hermance in the company's Q4 earnings release. The good news is declining net interest margins may have run their course - falling just one basis point during the Q to 1.47%; they were 1.97% a year ago.
- The shrinking balance sheet - assets fell $1.99B during 2013 - boosted Tier 1 capital leverage to 10.82%.
- Management is considering a number of plans to cut interest rate risk this year, with something likely to be in place by H2 and forcing quarterly results into the red.
- Press release, Q4 report
Jan. 29, 2014, 8:06 AM
Jan. 21, 2014, 9:58 AM
- M&T Bank (MTB -1%) and Hudson City Bancorp (HCBK -1.1%) are again the laggards in a nicely green regional bank sector (KRE +1.9%) as Raymond James pulls its Buy rating on M&T following last week's earnings report.
- At issue with the results are the high costs M&T is experiencing to upgrade its infrastructure to comply with the Bank Secrecy Act and anti-money laundering laws. The immediate need for all the work is to please regulators currently holding up the Hudson City takeover, but management insists it's something which would need to be done anyway.
HCBK vs. ETF Alternatives
Hudson City Bancorp Inc serves as the holding company for Hudson City Savings Bank. It is a community and consumer-oriented retail savings bank offering traditional deposit products, residential real estate mortgage loans and consumer loans.
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