Hudson City said Monday that a proposed merger with M&T Bank has been delayed again.
Hudson said that M&T Bank received notice that the Federal Reserve will not make a decision on the merger in time to close the deal by May 1 as previously expected. The Federal Reserve said it decided not to act, and Hudson said it is working on a response.
"Given the unexpected notice of delay over a holiday weekend," Hudson City CEO Denis Salamone said in a written statement, "the board of Hudson City needs more time to understand the nature and timing of the delay and its potential impact on the transaction before the board can determine its course of action."
M&T first announced plans to buy Hudson City in August 2012. The deal has been delayed several times as the banks seek approval. The deal was valued at $3.7 billion at the time. The Federal Reserve is concerned about procedures related to its bank secrecy and anti-money-laundering compliance program.
Shares of M&T Bank Corp., based in Buffalo, New York, fell $3.07, or 2.4 percent, to $124.14 in midday trading Monday. Shares of Paramus, New Jersey-based Hudson City Bancorp Inc. fell 60 cents, or 5.7 percent, to $9.89.
Copyright 2015 The Associated Press.