Hudson City Announces Settlement With DOJ, CFPB

(RTTNews) - Hudson City Bancorp Inc (HCBK), the holding company for Hudson City Savings Bank (the "Bank"), on Thursday announced that the Bank has entered into a settlement agreement with the U.S. Department of Justice ("DOJ") and the Consumer Financial Protection Bureau ("CFPB") related to certain alleged violations of the Fair Housing Act and Equal Credit Opportunity Act.

The settlement was the result of investigations by the DOJ and CFPB into Hudson City's lending practices in majority-Black and Hispanic areas in its footprint mostly outside of New Jersey during the years 2009 through 2013.

The DOJ and CFPB asserted that the Bank failed to originate enough loans in these areas when compared to a group of other market participants using statistical analysis of market data.

Although Hudson City disagrees with the statistical analysis of loans relied upon by the DOJ and CFPB as the principal basis for its claims as well as the agencies' conclusions from their investigations, the Bank has agreed to offer $25 million in subsidies to support home lending in minority areas and to implement a number of outreach and educational programs to residents of these communities.

The Bank decided to settle this matter, which includes payment of a $5.5 million civil penalty, to avoid litigation with these agencies so that it can focus on continuing to provide fair credit services to its customers and working to complete its pending merger with M&T Bank Corp.