M&T-Hudson City Deal Delayed by Fed's Money-Laundering Review
The Buffalo, N.Y., bank has selected Gino Martocci and two others to run the operations in the New York City region it is scheduled to acquire from Hudson City before midyear.February 26
M&T Bank's (MTB) purchase of Hudson City Bancorp (HCBK) faces a lengthy delay after regulators raised concerns about M&T's compliance with anti-money-laundering rules.
The Federal Reserve Board also expressed concerns about M&T's compliance with the Bank Secrecy Act, the companies said in press release Friday. As the result, the companies moved the termination date for the merger back to Jan. 31 from its original Aug. 27 deadline.
M&T, in Buffalo, N.Y., has started a "major initiative" and hired a consulting firm to address the Fed's concerns. Representatives for the companies were not immediately available for comment.
The shareholders of each company will still meet next week to vote on the merger, the companies said.
The $84 billion-asset M&T agreed in September to pay $3.7 billion in cash and stock for the $44 billion-asset Hudson City, based in Paramus, N.J. Earlier this year, M&T tapped three executives to integrate and run Hudson City's operations.