Magazine article American Banker

Lower Yields, Higher Expenses Hurt Hudson City in 3Q

Magazine article American Banker

Lower Yields, Higher Expenses Hurt Hudson City in 3Q

Article excerpt

Byline: Brian Browdie

Lower yields and higher expenses weighed on Hudson City Bancorp (HCBK) in Paramus, N.J., in the third quarter.

Earnings at the $43 billion-asset company, which M&T Bank in Buffalo, N.Y. agreed in August to buy for $3.7 billion in cash and stock, fell 33.6%, to $55.9 million, from the same period a year ago, Hudson City reported Wednesday.

Hudson City recorded net interest income of $203.2 million, down 16.9% from the third quarter of 2011, primarily because of declining interest rates on mortgage loans and a decrease in interest-earning assets. Its net interest margin increased 5 basis points, to 2.02%, from a year earlier because it paid off $4.3 billion in high-cost borrowings in December.

Noninterest income remained roughly unchanged, at $3 million. Noninterest expense rose 12.2%, to $93.8 million, as a result of higher spending on pay and employee benefits, as well as expenses related to the company's merger with M&T. …

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