Compass Point Downgrades Hudson City Bancorp (HCBK) to Neutral; Regulatory Scrutiny Heightened

May 14, 2012 8:52 AM EDT
Get Alerts HCBK Hot Sheet
Price: $10.12 --0%

Rating Summary:
    2 Buy, 11 Hold, 2 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 6 | Down: 3 | New: 2
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Compass Point downgraded Hudson City Bancorp (NASDAQ: HCBK) to Neutral, price target cut to $7.00.

Analyst, Mike Turner, said, "In their recent 10-Q filing, HCBK disclosed that they received a new memorandum of understanding from the Federal Reserve on April 24. While the language would imply the new MOU is generally no different than the current one with the OCC, we remain concerned. Why has the Fed inserted themselves into the situation a year after the initial MOU, and why was there no mention of it in the earnings release which was announced a day after the new MOU was received? Also, the MOU states the company must obtain approval before issuing debt with a maturity greater than one year. While we have no reason to believe they haven't received this approval, their ability to offer any fixed rate mortgages is almost completely impaired if this were the case."

For an analyst ratings summary and ratings history on Hudson City Bancorp click here. For more ratings news on Hudson City Bancorp click here.

Shares of Hudson City Bancorp closed at $6.47 yesterday.

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