M&T Bank And Hudson City Bancorp Get Approval To Merge

Hudson City Bancorp (HCBK – Get Report) stock is gaining by 5.26% to $10 in early afternoon trading on Wednesday, after the Federal Reserve approved M&T Bank’s acquisition of the company today.

It is believed that M&T might have satisfied the Federal Reserve that it had built sound controls to identify suspicious fund movements.

Separately, TheStreet Ratings team rates HUDSON CITY BANCORP INC as a Buy with a ratings score of B-.

The combination will create the 14th-biggest bank in the USA with combined assets of around $132 billion.

“At M&T, we are deeply committed to the success of the customers and communities we serve, and we look forward to the opportunity to bring that strong commitment to Hudson City’s markets”, said Robert G. Wilmers, M&T Chairman and CEO.

“We also found their integrity and care for their customers was very similar to Hudson City’s values and culture”. Shareholders have until October. 30 to elect what form of consideration they wish to receive. It’s expected to be completed on November 1, pending approval by the New York State Department of Financial Services and the satisfaction of closing conditions.

Hudson City branches will operate under the M&T name until they are converted to M&T’s network, which is expected to happen in the first quarter of 2016. “M&T also brings a wider array of banking solutions and services”. Upon the central bank’s recommendation, M&T started revamping its anti-money laundering program, spending millions of dollars to do so.

Both firms first made their agreement to merge known in August 2012, as M&T hoped to increase its footprint in New Jersey where Hudson City is headquartered. The regulator had told the lenders it would reach a decision on the proposed deal by the end of this month, Paramus, New Jersey-based Hudson City said in April.