Fri, Apr. 17, 8:10 AM
- Hudson City Bancorp (NASDAQ:HCBK) and M&T Bank (NYSE:MTB) agree yet again to extend their merger agreement, this time from April 30 to October 31.
- Originally announced about three years ago, the merger received its latest - and some thought fatal - blow earlier this month when the Fed signaled it's still not ready to approve.
- HCBK +6.3% premarket.
- Source: Press release
- Previously: Hudson City mulling options as sale to M&T delayed again (April 6)
- Previously: Hudson City lower on report of discriminatory lending (April 15)
Wed, Apr. 15, 2:30 PM
- Another potential stumbling block to its long-delayed sale to M&T Bank (MTB +1.1%) - now about three years and counting - Hudson City Bancorp (HCBK -1.1%) is under investigation by the DOJ and CFPB over vioations of the Fair Housing Act, with a preliminary CFPB review finding the bank denied loans to those in minority communities.
- Source: Bloomberg
- The sale to M&T has been delayed all this time over concerns about M&T's money-laundering controls, and it's unclear what delays this new probe could bring.
- So far, the banks have signaled their sticking with the deal, but should it fall through, it could be a long way down for both. HCKB was trundling along at less than $6 per share prior to the agreement, and it's above $9 today.
- Previously: Hudson City mulling options as sale to M&T delayed again (April 6)
Mon, Apr. 6, 8:13 AM
- The Fed informed M&T Bancorp (NYSE:MTB) late Friday that it will not be able to approve its purchase of Hudson City Bancorp (NASDAQ:HCBK) ahead of the April 30 termination date.
- The two banks have discussed this latest disappointment, and Hudson City is going to take some time so decide on its next moves. CEO Denis Salamone: "We continue to believe the strategic and economic fundamentals of the merger of Hudson City and M&T are attractive to Hudson City's shareholders, customers and the communities we serve."
Mon, Mar. 23, 9:43 AM
- Hudson City Bancorp (HCBK +2.7%) notifies participants in its ESOP of a "blackout period" expected to begin on April 21 in anticipation of the possible closing of its sale to M&T Bank (MTB +0.8%).
- To review, the $3.7B deal was originally announced almost three years ago, but has been held up until the Fed finds itself satisfied with M&T's money-laundering controls.
- Source: SEC Form 8-K
Wed, Mar. 4, 3:44 PM
- M&T Bank (MTB -0.3%) announced the agreement to purchase Hudson City Bancorp (HCBK) nearly three years ago, but the regulatory green-light has been on hold pending approval of the banks' anti-money-laundering compliance program.
- While the stress test and CCAR have nothing to do with money-laundering compliance, analyst Marty Mosby suspects if both banks' capital plans are approved, then a merger approval isn't far behind.
- The current deadline for a closing is April 30.
- The stress tests results are due after the close on Thursday, with the CCAR results six days later.
Tue, Jan. 20, 1:19 PM
- "Substantial progress" has been made, says M&T Bank (MTB -1.6%) CFO Rene Jones on the conference call, on the subject of his bank's coming into better compliance with anti-money laundering regulations.
- The issues have held up M&T's purchase of Hudson City Bancorp (HCBK -0.9%) forever, but Jones still expects the deal to close (though declining to give a time frame).
- "The capabilities we have today versus where we were two years ago are vastly different, so we feel very good about that progress."
- Previously: Big drop in net interest margin at M&T Bank (Jan. 20)
- Previously: M&T Bank beats by $0.01, revenue in-line (Jan. 20)
Dec. 9, 2014, 8:11 AM
- The merger plan was originally announced more than two years ago, but regulators have sat on it over concerns with M&T Bank's (NYSE:MTB) compliance with the Bank Secrecy Act and anti-money laundering compliance program.
- With the deadline of December 31 approaching, M&T and HCBK today announce an extension to April 30, 2015.
- Hudson City EO Denis Salamone: "While we are disappointed that the transaction is delayed further, we understand that M&T has continued to make significant progress towards addressing the Federal Reserve's concerns."
- Source: Press Release
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. 17, 2014, 3:16 PM
- "You can't give a measure of completion because it's a dynamic process, so we work with our teams to build out a process, we go through that, we have those processes validated by outside parties," says M&T (MTB -2.8%) CFO Rene Jones on the earnings call to analysts who mostly just wanted to hear about progress the Bank Secrecy Act and anti-money laundering compliance - and when the Hudson City takeover (HCBK -2.7%) might close.
- CC transcript
- Previous earnings coverage
- Management expects expenses on upgrading the bank infrastructure to begin declining in size by Q4. Jones does say both banks have reviewed the economics of the deal and remain very committed to it.
- Sterne Agee's Todd Hagerman: "It seems as almost the agreement is becoming ... an agreement in principle, such that when the stars align sometime in the future, the boards will revisit the transaction and determine whether or not it makes sense."
- Rene Jones: "Put Hudson City aside for a minute ... We tend to think long-term. So regardless of any specific merger transaction, we think in order to survive and be around, you've got to have a pretty strong infrastructure ... These investments that we're making, particularly in risk management, don't relate to any one particular transaction."
Dec. 17, 2013, 9:11 AM
- Hudson City Bancorp (HCBK) and M&T Bank (MTB) agree to extend the time to complete their merger until December 31, 2014.
- To review, M&T agreed to buy Hudson City in August 2012, but regulators - displeased with M&T's money laundering policies - put the deal on ice, chilling not just this transaction, but a lot of other possible regional bank M&A.
- "M&T has received no assurance from the Federal Reserve as to whether or when the Federal Reserve will approve the merger. However, M&T and Hudson City believe that the earliest time the merger could be completed is in the latter half of 2014."
- Hudson City CEO Ronald Hermance: "While all parties are disappointed that the transaction is delayed further, we are gratified that M&T continues to see the value in the Hudson City franchise. Our Board of Directors continues to believe that the M&T transaction is ultimately in the best interest of the company and our shareholders, but is also committed to diversifying our business model by continuing to pursue our Strategic Plan."
- HCBK -1.2% premarket
- Press release
Oct. 17, 2013, 11:50 AM
- M&T Bank (MTB -2.9%) and Hudson CIty Bancorp (HCBK -3.1%) are notable laggards in the regional bank sector after M&T's Q3 earnings report gives no clue on progress towards regulatory approval of their merger.
- "We're not really focused on (the merger)," says CFO Rene Jones on the earnings call, preferring instead to spend energy on operating the bank and getting through the next CCAR (Fed stress test and approval of capital returns).
- Like with other banks, M&T suffered from the slowdown in the mortgage business, with noninterest income falling to $421M vs. $451M a year ago.
- Q3 results, press release.
Jul. 18, 2013, 3:52 PMHudson City Bancorp (HCBK +1.7%) shrugs off a downgrade to Hold at Sandler O'Neill as suitor M&T Bank (MTB +1.1%) rises following yesterday's earnings (the acquisition is an all stock deal). Speaking to American Banker, M&T CFO Rene Jones says the bank remains comfortable with the purchase despite higher mortgage rates which could crimp Hudson City's profits. M&T, he says, is committed to reforming the anti-money laundering policies which have held up the merger's approval. | Comment!
Jun. 18, 2013, 11:30 AM
May 24, 2013, 7:11 AMRemember M&T Bank's (MTB) proposed purchase of Hudson City Bancorp (HCBK)? Regulators have put the merger on ice and it's sending a chill through the executive suites of other regional banks (KRE) who were considering doing deals, but now figure it's not worth the regulatory scrutiny. In the past, conditions such as we're in - slow economy, weak loan growth - have prompted waves of bank mergers (it's happening in community banks). "I am not buying another bank for as long as I can see," sees one unnamed top executive. | Comment!
Apr. 12, 2013, 9:29 AMM&T Bank (MTB) and Hudson City Bancorp (HCBK) both tumble about 4.5% as they have been unable to gain regulatory approval for their merger. "The timeframe for closing the transaction will be extended substantially beyond the date previously expected." The date for terminating the agreement is moved from August 27 to January 31, 2014. (PR) | Comment!
Oct. 25, 2012, 1:24 PMWanting to secure long-term financing for its GE Capital unit, GE reportedly made a play for Hudson City Bancorp (HCBK) before the lender fell into the arms of M&T Bank (MTB). Previously (and maybe still) a bank dressed up in an industrial firm's clothes, GE's reliance on short-term funding nearly brought the enterprise to ruin in 2008. | Comment!
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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