Quarterly profits plunged at Hudson City Bancorp in Paramus, N.J., last quarter as it awaits regulatory approval to be sold to M&T Bank.
The $37.8 billion-asset financial institution reported net income of $39.2 million for the quarter, down 19% year over year. Earnings per share of 8 cents beat estimates of analysts polled by Bloomberg by 1 cent.
Net interest income declined 26%, to $117.7 million, as interest-earning assets and liabilities decreased. Net interest margin fell 35 basis points from the year-ago period, to 1.29%.
M&T agreed to buy Hudson City in August 2012. However, the deal has yet to close because regulators are making M&T fix anti-laundering problems. The deadline to complete the transaction has been extended until yearend.
Hudson City reported some good news in its quarterly earnings release Wednesday. Noninterest income rose 121%, to $21.2 million, as the company obtained $19.5 million from selling mortgage-backed securities in advance of rising interest rates.
Noninterest expenses fell more than 4%, to $73.1 million, because of a $6.5 million decrease in deposit-insurance assessments. Yet Hudson City spent an additional $1.8 million in legal fees as it hires more consultants.
Hudson City did not make a loan-loss provision in the second quarter. A year ago it reported a provision of $12.5 million.
Net chargeoffs were $10.7 million, down 34% from last year.
Shares of Hudson City closed trading on Wednesday at $9.76, the same as the previous day.