Hudson City 1Q Profit Climbs 17% But Charge-Offs Rise

Hudson City Bancorp's first-quarter earnings rose 17%, but the New Jersey-based regional bank saw both its loan-loss provisions and net charge-offs climb.

Though he noted there are signs the economy and housing markets are stabilizing, Chief Executive Ronald E. Hermance Jr. warned the elevated level of unemployment and the extended length of time that it takes to complete a foreclosure may continue to result in higher levels of nonperforming loans going forward. In the most recent period, they increased by $117.2 million, to $744.9 million.

Shares slid 1.8%, to $14.25 in after-hours trading, and are up about 6% so far this year.

Hudson City reported a profit of $148.9 million, or 30 cents a share, up from $127.7 million, or 26 cents, a year earlier. The latest period included $30.8 million in pretax securities gains from the sale of mortgage-backed securities, partially offset by $8.5 million of accelerated amortization and loss of income on certain securities.

Revenue jumped 27%, to $364.1 million.

Analysts polled by Thomson Reuters had most recently forecast earnings of 28 cents on $343 million in revenue.

Loan-loss provisions were $50 million, up from $20 million a year earlier and $45 million in the prior quarter. Net charge-offs, or loans lenders don't think are collectible, rose to $24.2 million from $4.7 million a year earlier.

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