Want to make the merger gods laugh? Tell them your turnaround plans in a low interest rate environment.

Hudson City Bancorp (HCBK) could no longer defy the odds of interest rate risk, agreeing Monday to sell itself to M&T Bank (MTB) for $3.7 billion. The deal, one of the largest in years, is a hard-luck ending for a former industry darling that relied too heavily on making jumbo home loans financed by wholesale funds.

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