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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-K
  þ
    
    Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 For the fiscal year ended:December 31, 2008
 o
    
    Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 For the transition period from to
 Commission File Number: 0-26001
 Hudson City Bancorp, Inc.
  Delaware
    
    22-3640393(State or other jurisdiction of 
incorporation or organization)
    
    (I.R.S. Employer
Identification No.)West 80 Century Road Paramus, New Jersey
    
    07652(Address of Principal Executive Offices)
    
    (Zip Code)
 
   
  þ o
  o þ
  þ o
 o
  Large accelerated filer þAccelerated filer oNon-accelerated filer o(Do not check if a smaller reporting company)Smaller reporting company o  o þ




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##### 



Hudson City Bancorp, Inc.
2008 Annual Report on Form 10-K
Table of Contents
 PagePrivate Securities Litigation Reform Act Safe Harbor Statement
    
    
    1PART IItem 1
    
    Business
    
    
    2Item 1A
    
    Risk Factors
    
    
    49Item 1B
    
    Unresolved Staff Comments
    
    
    54Item 2
    
    Properties
    
    
    54Item 3
    
    Legal Proceedings
    
    
    54Item 4
    
    Submission of Matters to a Vote of Security Holders
    
    
    54PART IIItem 5
    
    Market for Registrants Common Equity, Related Stockholder
Matters and Issuer Purchases of Equity Securities
    
    
    55Item 6
    
    Selected Financial Data
    
    
    58Item 7
    
    Managements Discussion and Analysis of Financial Condition
and Results Of Operations
    
    
    60Item 7A
    
    Quantitative and Qualitative Disclosures About Market Risk
    
    
    86Item 8
    
    Financial Statements and Supplementary Data
    
    
    94Item 9
    
    Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure
    
    
    140Item 9A
    
    Controls and Procedures
    
    
    141Item 9B
    
    Other Information
    
    
    142PART IIIItem 10
    
    Directors, Executive Officers and Corporate Governance
    
    
    142Item 11
    
    Executive Compensation
    
    
    142Item 12
    
    Security Ownership of Certain Beneficial Owners and Management
and Related Stockholder Matters
    
    
    142Item 13
    
    Certain Relationships and Related Transactions, and Director
Independence
    
    
    143Item 14
    
    Principal Accounting Fees and Services
    
    
    143PART IVItem 15
    
    Exhibits, Financial Statement Schedules
    
    
    143SIGNATURES
    
    
    
    
    146EX-10.3: FORM OF AMENDED AND RESTATED TWO-YEAR CHANGE IN CONTROL AGREEMENTEX-10.11: AMENDED AND RESTATED EMPLOYMENT AGREEMENTEX-10.12: AMENDED AND RESTATED EMPLOYMENT AGREEMENTEX-10.13: AMENDED AND RESTATED EMPLOYMENT AGREEMENTEX-10.14: AMENDED AND RESTATED EMPLOYMENT AGREEMENTEX-10.28: BENEFIT MAINTAINANCE PLANEX-10.31: DIRECTORS' DEFERRED COMPENSATION PLANEX-10.32: OFFICERS DEFERRED COMPENSATION PLANEX-21.1: SUBSIDIARIES OF HUDSON CITY BANCORP, INC.EX-23.1: CONSENT OF KPMG LLPEX-31.1: CERTIFICATIONEX-31.2: CERTIFICATIONEX-32.1: CERTIFICATION




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PRIVATE SECURITIES LITIGATION REFORM ACT SAFE HARBOR STATEMENT
  
    
    the timing and occurrence or non-occurrence of events may be subject to circumstances
beyond our control;
    
    there may be increases in competitive pressure among the financial institutions or from
non-financial institutions;
    
    changes in the interest rate environment may reduce interest margins or affect the value of
our investments;
    
    changes in deposit flows, loan demand or real estate values may adversely affect our
business;
    
    changes in accounting principles, policies or guidelines may cause our financial condition
to be perceived differently;
    
    general economic conditions, either nationally or locally in some or all of the areas in
which we do business, or conditions in the securities markets or the banking industry may be
less favorable than we currently anticipate;
    
    legislative or regulatory changes may adversely affect our business;
    
    applicable technological changes may be more difficult or expensive than we anticipate;
    
    success or consummation of new business initiatives may be more difficult or expensive than
we anticipate;
    
    litigation or matters before regulatory agencies, whether currently existing or commencing
in the future, may delay the occurrence or non-occurrence of events longer than we anticipate;
    
    the risks associated with continued diversification of assets and adverse changes to credit
quality;
    
    difficulties associated with achieving expected future financial results; and
    
    the risk of an economic slowdown that would adversely affect credit quality and loan
originations.
   Page 1




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PART I
 
 Item 1. Business.
 Hudson City Bancorp, Inc.
  Hudson City Savings.
     Page 2




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Available Information
 ,
 Market Area
   
    Page 3




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Competition
   Lending Activities
 Loan Portfolio Composition.
  Page 4




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Page 5




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At December 31,2008
    
    
    2007
    
    
    2006
    
    
    2005
    
    
    2004Percent
    
    
    
    
    
    
    Percent
    
    
    
    
    
    
    Percent
    
    
    
    
    
    
    Percent
    
    
    
    
    
    
    PercentAmount
    
    
    of Total
    
    
    Amount
    
    
    of Total
    
    
    Amount
    
    
    of Total
    
    
    Amount
    
    
    of Total
    
    
    Amount
    
    
    of Total(Dollars in thousands)First mortgage loans:One- to four-family
    
    $
    28,935,645
    
    
    
    98.36
    %
    
    $
    23,671,712
    
    
    
    97.86
    %
    
    $
    18,561,467
    
    
    
    97.27
    %
    
    $
    14,780,819
    
    
    
    98.13
    %
    
    $
    11,120,874
    
    
    
    97.87
    %FHA/VA
    
    
    20,197
    
    
    
    0.07
    
    
    
    22,940
    
    
    
    0.09
    
    
    
    29,573
    
    
    
    0.15
    
    
    
    43,672
    
    
    
    0.29
    
    
    
    81,915
    
    
    
    0.72Multi-family and
commercial
    
    
    53,421
    
    
    
    0.18
    
    
    
    58,874
    
    
    
    0.24
    
    
    
    69,322
    
    
    
    0.36
    
    
    
    2,320
    
    
    
    0.02
    
    
    
    3,000
    
    
    
    0.03Construction
    
    
    24,830
    
    
    
    0.08
    
    
    
    34,064
    
    
    
    0.14
    
    
    
    41,150
    
    
    
    0.22
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Total first
mortgage loans
    
    
    29,034,093
    
    
    
    98.69
    
    
    
    23,787,590
    
    
    
    98.33
    
    
    
    18,701,512
    
    
    
    98.00
    
    
    
    14,826,811
    
    
    
    98.44
    
    
    
    11,205,789
    
    
    
    98.62Consumer
and other loans:Fixed-rate second
mortgages
    
    
    262,538
    
    
    
    0.89
    
    
    
    284,406
    
    
    
    1.18
    
    
    
    274,028
    
    
    
    1.44
    
    
    
    205,826
    
    
    
    1.37
    
    
    
    127,737
    
    
    
    1.12Home equity credit
lines
    
    
    101,751
    
    
    
    0.35
    
    
    
    104,567
    
    
    
    0.43
    
    
    
    97,644
    
    
    
    0.51
    
    
    
    29,150
    
    
    
    0.19
    
    
    
    28,929
    
    
    
    0.25Other
    
    
    20,506
    
    
    
    0.07
    
    
    
    15,718
    
    
    
    0.06
    
    
    
    10,433
    
    
    
    0.05
    
    
    
    662
    
    
    
    
    
    
    
    584
    
    
    
    0.01Total consumer and
other loans
    
    
    384,795
    
    
    
    1.31
    
    
    
    404,691
    
    
    
    1.67
    
    
    
    382,105
    
    
    
    2.00
    
    
    
    235,638
    
    
    
    1.56
    
    
    
    157,250
    
    
    
    1.38Total loans
    
    
    29,418,888
    
    
    
    100.00
    %
    
    
    24,192,281
    
    
    
    100.00
    %
    
    
    19,083,617
    
    
    
    100.00
    %
    
    
    15,062,449
    
    
    
    100.00
    %
    
    
    11,363,039
    
    
    
    100.00
    %Deferred loan
costs (fees)
    
    
    71,670
    
    
    
    
    
    
    
    40,598
    
    
    
    
    
    
    
    16,159
    
    
    
    
    
    
    
    1,653
    
    
    
    
    
    
    
    (8,073
    )Allowance for
loan losses
    
    
    (49,797
    )
    
    
    
    
    
    
    (34,741
    )
    
    
    
    
    
    
    (30,625
    )
    
    
    
    
    
    
    (27,393
    )
    
    
    
    
    
    
    (27,319
    )Net Loans
    
    $
    29,440,761
    
    
    
    
    
    
    $
    24,198,138
    
    
    
    
    
    
    $
    19,069,151
    
    
    
    
    
    
    $
    15,036,709
    
    
    
    
    
    
    $
    11,327,647
  At December 31, 2008Loans in each stateto Total loansNew Jersey
    
    
    44.8
    %New York
    
    
    15.6
    %Connecticut
    
    
    9.3
    %Total New York metropolitan area
    
    
    69.7
    %Virginia
    
    
    5.5
    %Illinois
    
    
    4.3
    %Maryland
    
    
    4.2
    %Massachusetts
    
    
    3.0
    %Minnesota
    
    
    1.8
    %Michigan
    
    
    1.7
    %Pennsylvania
    
    
    1.5
    %All others (30 states)
    
    
    8.3
    %30.3
    %100.0
    %
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Loan Maturity .
 At December 31, 2008Multi-familyFirst Mortgage
    
    
    and Commercial
    
    
    
    
    
    
    Consumer andLoans
    
    
    Mortgages
    
    
    Construction
    
    
    Other Loans
    
    
    Total(In thousands)Amounts Due:One year or less
    
    $
    1,370
    
    
    $
    6,703
    
    
    $
    24,830
    
    
    $
    3,991
    
    
    $
    36,894After one year:One to three years
    
    
    8,015
    
    
    
    11,107
    
    
    
    
    
    
    
    16,522
    
    
    
    35,644Three to five years
    
    
    57,166
    
    
    
    16,673
    
    
    
    
    
    
    
    15,449
    
    
    
    89,288Five to ten years
    
    
    719,662
    
    
    
    10,742
    
    
    
    
    
    
    
    61,094
    
    
    
    791,498Ten to twenty years
    
    
    1,942,284
    
    
    
    6,392
    
    
    
    
    
    
    
    281,801
    
    
    
    2,230,477Over twenty years
    
    
    26,227,345
    
    
    
    1,804
    
    
    
    
    
    
    
    5,938
    
    
    
    26,235,087Total due after one
year
    
    
    28,954,472
    
    
    
    46,718
    
    
    
    
    
    
    
    380,804
    
    
    
    29,381,994Total loans
    
    $
    28,955,842
    
    
    $
    53,421
    
    
    $
    24,830
    
    
    $
    384,795
    
    
    
    29,418,888Deferred loan costs
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    71,670Allowance for loan losses
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (49,797
    )Net loans
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    29,440,761
  Due After December 31, 2009Fixed
    
    
    Adjustable
    
    
    Total(In thousands)First mortgage loans
    
    $
    21,903,253
    
    
    $
    7,051,219
    
    
    $
    28,954,472Multi-family and commercial mortgages
    
    
    44,677
    
    
    
    2,041
    
    
    
    46,718Consumer and other loans
    
    
    270,154
    
    
    
    110,650
    
    
    
    380,804Total loans due after one year
    
    $
    22,218,084
    
    
    $
    7,163,910
    
    
    $
    29,381,994
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For the Year Ended December 31,2008
    
    
    2007
    
    
    2006(In thousands)Total loans:Balance outstanding at beginning of period
    
    $
    24,192,281
    
    
    $
    19,083,617
    
    
    $
    15,062,449Loans transferred in Acquisition
    
    
    
    
    
    
    
    
    
    
    774,908Originations:One- to four-family first mortgage loans
    
    
    4,949,024
    
    
    
    3,206,695
    
    
    
    2,144,991Multi-family and commercial mortgage loans
    
    
    250
    
    
    
    4,125
    
    
    
    3,392Construction loans
    
    
    9,038
    
    
    
    8,593
    
    
    
    7,614Consumer and other loans
    
    
    81,909
    
    
    
    133,098
    
    
    
    151,490Total originations
    
    
    5,040,221
    
    
    
    3,352,511
    
    
    
    2,307,487Purchases:One- to four-family first mortgage loans
    
    
    3,061,859
    
    
    
    3,971,273
    
    
    
    2,711,604Other first mortgage loans
    
    
    
    
    
    
    
    
    
    
    544Total purchases
    
    
    3,061,859
    
    
    
    3,971,273
    
    
    
    2,712,148Less:Principal payments:First mortgage loans
    
    
    (2,759,356
    )
    
    
    (2,104,443
    )
    
    
    (1,678,882
    )Consumer and other loans
    
    
    (101,805
    )
    
    
    (110,510
    )
    
    
    (73,997
    )Total principal payments
    
    
    (2,861,161
    )
    
    
    (2,214,953
    )
    
    
    (1,752,879
    )Premium amortization and discount accretion, net
    
    
    4,580
    
    
    
    1,585
    
    
    
    (1,440
    )Transfers to foreclosed real estate
    
    
    (18,892
    )
    
    
    (1,752
    )
    
    
    (3,642
    )Loan sales
    
    
    
    
    
    
    
    
    
    
    (15,414
    )Balance outstanding at end of period
    
    $
    29,418,888
    
    
    $
    24,192,281
    
    
    $
    19,083,617
 Residential Mortgage Lending .
  Page 8




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.
  Page 9




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Percent ofFirst MortgageAmount
    
    Loan Originations(In thousands)2008
    
    $
    197,266
    
    
    
    4.1
    %2007
    
    
    107,481
    
    
    
    3.32006
    
    
    83,693
    
    
    
    3.9
  Mortgage LoansModified(In thousands)2008
    
    $
    88,7022007
    
    
    15,2722006
    
    
    11,656
  Page 10




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Page 11




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.
 Multi-family and Commercial Mortgage Loans.
  Page 12




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Construction Lending .
   Consumer Loans .
 Page 13




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Loan Approval Procedures and Authority .
   Page 14




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Asset Quality
   Page 15




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At December 31, 2008Average LTV ratio ofTotal loans
    
    Non-performing loans
    
    Non-performing mortgage loansNew Jersey
    
    
    44.8
    %
    
    
    40.4
    %
    
    
    65
    %New York
    
    
    15.6
    %
    
    
    22.6
    %
    
    
    65
    %Connecticut
    
    
    9.3
    %
    
    
    2.3
    %
    
    
    71
    %Total New York
metropolitan area
    
    
    69.7
    %
    
    
    65.3
    %
    
    
    65
    %Virginia
    
    
    5.5
    %
    
    
    4.2
    %
    
    
    71
    %Illinois
    
    
    4.3
    %
    
    
    3.5
    %
    
    
    77
    %Maryland
    
    
    4.2
    %
    
    
    5.4
    %
    
    
    76
    %Massachusetts
    
    
    3.0
    %
    
    
    2.7
    %
    
    
    77
    %Minnesota
    
    
    1.8
    %
    
    
    3.8
    %
    
    
    74
    %Michigan
    
    
    1.7
    %
    
    
    3.7
    %
    
    
    71
    %Pennsylvania
    
    
    1.5
    %
    
    
    1.5
    %
    
    
    70
    %All others
    
    
    8.3
    %
    
    
    9.9
    %
    
    
    69
    %30.3
    %
    
    
    34.7
    %
    
    
    73
    %100.0
    %
    
    
    100.0
    %
    
    
    68
    %
  Delinquent Loans and Foreclosed Assets .
   Page 16




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At December 31,2008
    
    
    2007
    
    
    200660-89 Days
    
    
    90 Days or More
    
    
    60-89 Days
    
    
    90 Days or More
    
    
    60-89 Days
    
    
    90 Days or MorePrincipal
    
    
    
    
    
    
    Principal
    
    
    
    
    
    
    Principal
    
    
    
    
    
    
    Principal
    
    
    
    
    
    
    Principal
    
    
    
    
    
    
    PrincipalNo. of
    
    
    Balance
    
    
    No. of
    
    
    Balance
    
    
    No. of
    
    
    Balance
    
    
    No. of
    
    
    Balance
    
    
    No. of
    
    
    Balance
    
    
    No. of
    
    
    BalanceLoans
    
    
    of Loans
    
    
    Loans
    
    
    of Loans
    
    
    Loans
    
    
    of Loans
    
    
    Loans
    
    
    of Loans
    
    
    Loans
    
    
    of Loans
    
    
    Loans
    
    
    of Loans(Dollars in thousands)One- to four-family
first mortgages
    
    
    265
    
    
    $
    100,604
    
    
    
    527
    
    
    $
    200,642
    
    
    
    103
    
    
    $
    32,448
    
    
    
    198
    
    
    $
    71,614
    
    
    
    60
    
    
    $
    16,910
    
    
    
    82
    
    
    $
    22,026FHA/VA first mortgages
    
    
    5
    
    
    
    874
    
    
    
    30
    
    
    
    6,407
    
    
    
    12
    
    
    
    1,995
    
    
    
    21
    
    
    
    4,157
    
    
    
    8
    
    
    
    1,236
    
    
    
    23
    
    
    
    3,657Multi-family and
commercial mortgages
    
    
    1
    
    
    
    1,417
    
    
    
    4
    
    
    
    1,854
    
    
    
    3
    
    
    
    1,393
    
    
    
    2
    
    
    
    2,028
    
    
    
    1
    
    
    
    566
    
    
    
    
    
    
    
    Construction loans
    
    
    
    
    
    
    
    
    
    
    5
    
    
    
    7,610
    
    
    
    3
    
    
    
    4,457
    
    
    
    1
    
    
    
    647
    
    
    
    4
    
    
    
    2,769
    
    
    
    2
    
    
    
    3,098Consumer and other loans
    
    
    11
    
    
    
    1,850
    
    
    
    14
    
    
    
    1,061
    
    
    
    7
    
    
    
    329
    
    
    
    12
    
    
    
    956
    
    
    
    20
    
    
    
    1,125
    
    
    
    11
    
    
    
    1,217Total delinquent loans
(60 days and over)
    
    
    282
    
    
    $
    104,745
    
    
    
    580
    
    
    $
    217,574
    
    
    
    128
    
    
    $
    40,622
    
    
    
    234
    
    
    $
    79,402
    
    
    
    93
    
    
    $
    22,606
    
    
    
    118
    
    
    $
    29,998Delinquent loans
(60 days and over)
to total loans
    
    
    
    
    
    
    0.36
    %
    
    
    
    
    
    
    0.74
    %
    
    
    
    
    
    
    0.17
    %
    
    
    
    
    
    
    0.33
    %
    
    
    
    
    
    
    0.12
    %
    
    
    
    
    
    
    0.16
    %
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At December 31,2008
    
    
    2007
    
    
    2006
    
    
    2005
    
    
    2004(Dollars in thousands)Non-accrual first mortgage loans
    
    $
    202,496
    
    
    $
    71,932
    
    
    $
    20,053
    
    
    $
    9,649
    
    
    $
    6,057Non-accrual construction loans
    
    
    7,610
    
    
    
    647
    
    
    
    3,098
    
    
    
    
    
    
    
    Non-accrual consumer and other loans
    
    
    626
    
    
    
    956
    
    
    
    1,217
    
    
    
    2
    
    
    
    Accruing loans delinquent 90 days or more
    
    
    6,842
    
    
    
    5,867
    
    
    
    5,630
    
    
    
    9,661
    
    
    
    15,550Total non-performing loans
    
    
    217,574
    
    
    
    79,402
    
    
    
    29,998
    
    
    
    19,312
    
    
    
    21,607Foreclosed real estate, net
    
    
    15,532
    
    
    
    4,055
    
    
    
    3,161
    
    
    
    1,040
    
    
    
    878Total non-performing assets
    
    $
    233,106
    
    
    $
    83,457
    
    
    $
    33,159
    
    
    $
    20,352
    
    
    $
    22,485Non-performing loans to total loans
    
    
    0.74
    %
    
    
    0.33
    %
    
    
    0.16
    %
    
    
    0.13
    %
    
    
    0.19
    %Non-performing assets to total assets
    
    
    0.43
    
    
    
    0.19
    
    
    
    0.09
    
    
    
    0.07
    
    
    
    0.11
  Allowance for Loan Losses .
 At or for the Year December 31,2008
    
    
    2007
    
    
    2006
    
    
    2005
    
    
    2004(Dollars in thousands)Balance at beginning of year
    
    $
    34,741
    
    
    $
    30,625
    
    
    $
    27,393
    
    
    $
    27,319
    
    
    $
    26,547Provision for loan losses
    
    
    19,500
    
    
    
    4,800
    
    
    
    
    
    
    
    65
    
    
    
    790Allowance transferred in Acquisition
    
    
    
    
    
    
    
    
    
    
    3,308
    
    
    
    
    
    
    
    Charge-offs:First mortgage loans
    
    
    (4,458
    )
    
    
    (701
    )
    
    
    (72
    )
    
    
    (2
    )
    
    
    (11
    )Consumer and other loans
    
    
    (64
    )
    
    
    (62
    )
    
    
    (7
    )
    
    
    (8
    )
    
    
    (9
    )Total charge-offs
    
    
    (4,522
    )
    
    
    (763
    )
    
    
    (79
    )
    
    
    (10
    )
    
    
    (20
    )Recoveries
    
    
    78
    
    
    
    79
    
    
    
    3
    
    
    
    19
    
    
    
    2Net (charge-offs) recoveries
    
    
    (4,444
    )
    
    
    (684
    )
    
    
    (76
    )
    
    
    9
    
    
    
    (18
    )Balance at end of year
    
    $
    49,797
    
    
    $
    34,741
    
    
    $
    30,625
    
    
    $
    27,393
    
    
    $
    27,319Allowance for loan losses to total loans
    
    
    0.17
    %
    
    
    0.14
    %
    
    
    0.16
    %
    
    
    0.18
    %
    
    
    0.24
    %Allowance for loan losses to
non-performing loans
    
    
    22.89
    
    
    
    43.75
    
    
    
    102.09
    
    
    
    141.84
    
    
    
    126.44
  Page 19




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Page 20




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##### Table of Contents



Page 21




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##### Table of Contents



At December 31,2008
    
    
    2007
    
    
    2006
    
    
    2005
    
    
    2004Percentage
    
    
    
    
    
    
    Percentage
    
    
    
    
    
    
    Percentage
    
    
    
    
    
    
    Percentage
    
    
    
    
    
    
    Percentageof Loans in
    
    
    
    
    
    
    of Loans in
    
    
    
    
    
    
    of Loans in
    
    
    
    
    
    
    of Loans in
    
    
    
    
    
    
    of Loans inCategory to
    
    
    
    
    
    
    Category to
    
    
    
    
    
    
    Category to
    
    
    
    
    
    
    Category to
    
    
    
    
    
    
    Category toAmount
    
    
    Total Loans
    
    
    Amount
    
    
    Total Loans
    
    
    Amount
    
    
    Total Loans
    
    
    Amount
    
    
    Total Loans
    
    
    Amount
    
    
    Total Loans(Dollars in thousands)First mortgage loans:One- to four-family
    
    $
    45,642
    
    
    
    98.43
    %
    
    $
    29,511
    
    
    
    97.95
    %
    
    $
    24,578
    
    
    
    97.42
    %
    
    $
    25,474
    
    
    
    98.13
    %
    
    $
    25,524
    
    
    
    97.87
    %Other first mortgages
    
    
    2,065
    
    
    
    0.26
    
    
    
    1,883
    
    
    
    0.38
    
    
    
    999
    
    
    
    0.58
    
    
    
    23
    
    
    
    0.31
    
    
    
    35
    
    
    
    0.75Total first
mortgage loans
    
    
    47,707
    
    
    
    98.69
    
    
    
    31,394
    
    
    
    98.33
    
    
    
    25,577
    
    
    
    98.00
    
    
    
    25,497
    
    
    
    98.44
    
    
    
    25,559
    
    
    
    98.62Consumer and other loans
    
    
    2,090
    
    
    
    1.31
    
    
    
    3,347
    
    
    
    1.67
    
    
    
    3,618
    
    
    
    2.00
    
    
    
    1,774
    
    
    
    1.56
    
    
    
    1,305
    
    
    
    1.38Unallocated
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,430
    
    
    
    
    
    
    
    122
    
    
    
    
    
    
    
    455
    
    
    
    Total allowance for
loan losses
    
    $
    49,797
    
    
    
    100.00
    %
    
    $
    34,741
    
    
    
    100.00
    %
    
    $
    30,625
    
    
    
    100.00
    %
    
    $
    27,393
    
    
    
    100.00
    %
    
    $
    27,319
    
    
    
    100.00
    %
 Investment Activities
     Page 22




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Investment Securities .
 Mortgage-backed Securities .
 Page 23




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##### Table of Contents



For the Year Ended December 31,2008
    
    
    2007
    
    
    2006(In thousands)Investment securities:Carrying value at beginning of year
    
    $
    4,173,992
    
    
    $
    5,913,584
    
    
    $
    5,496,727Transferred in Acquisition
    
    
    
    
    
    
    
    
    
    
    120,087Purchases:Available for sale
    
    
    2,100,000
    
    
    
    2,148,705
    
    
    
    1,250,010Calls:Held to maturity
    
    
    (1,358,485
    )
    
    
    (125,480
    )
    
    
    (256
    )Available for sale
    
    
    (1,449,902
    )
    
    
    (2,100,060
    )
    
    
    (350,004
    )Maturities:Available for sale
    
    
    (4
    )
    
    
    (1,725,000
    )
    
    
    (500,005
    )Sales:Available for sale
    
    
    
    
    
    
    
    
    
    
    (97,549
    )Mutual fund shares
    
    
    
    
    
    
    
    
    
    
    (15,530
    )Premium amortization and discount
accretion, net
    
    
    164
    
    
    
    1,025
    
    
    
    (17
    )Change in unrealized gain or loss
    
    
    (2,046
    )
    
    
    61,218
    
    
    
    10,121Net (decrease) increase in investment
securities
    
    
    (710,273
    )
    
    
    (1,739,592
    )
    
    
    416,857Carrying value at end of year
    
    $
    3,463,719
    
    
    $
    4,173,992
    
    
    $
    5,913,584
 Page 24




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##### Table of Contents



For the Year Ended December 31,2008
    
    
    2007
    
    
    2006(In thousands)Mortgage-backed securities:Carrying value at beginning of year
    
    $
    14,570,935
    
    
    $
    9,329,631
    
    
    $
    6,910,497Transferred in Acquisition
    
    
    
    
    
    
    
    
    
    
    186,169Purchases:Held to maturity
    
    
    1,360,861
    
    
    
    3,861,633
    
    
    
    3,313,669Available for sale
    
    
    5,777,777
    
    
    
    3,248,326
    
    
    
    617,171Principal payments:Held to maturity
    
    
    (1,348,304
    )
    
    
    (1,215,867
    )
    
    
    (773,343
    )Available for sale
    
    
    (956,710
    )
    
    
    (696,560
    )
    
    
    (741,200
    )Sales:Available for sale
    
    
    
    
    
    
    
    
    
    
    (186,169
    )Premium amortization and discount accretion, net
    
    
    (11,722
    )
    
    
    (10,257
    )
    
    
    (10,709
    )Change in unrealized gain or loss
    
    
    94,974
    
    
    
    54,029
    
    
    
    13,546Net increase in mortgage-backed securities
    
    
    4,916,876
    
    
    
    5,241,304
    
    
    
    2,419,134Carrying value at end of year
    
    $
    19,487,811
    
    
    $
    14,570,935
    
    
    $
    9,329,631
 Page 25




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##### Table of Contents



At December 31,2008
    
    
    2007
    
    
    2006Percent
    
    
    
    
    
    
    
    
    
    
    Percent
    
    
    
    
    
    
    
    
    
    
    PercentCarrying
    
    
    of
    
    
    Fair
    
    
    Carrying
    
    
    of
    
    
    Fair
    
    
    Carrying
    
    
    of
    
    
    FairValue
    
    
    Total (1)
    
    
    Value
    
    
    Value
    
    
    Total (1)
    
    
    Value
    
    
    Value
    
    
    Total (1)
    
    
    Value(Dollars in thousands)Money market investments:Federal funds sold
    
    $
    76,896
    
    
    
    100.00
    %
    
    $
    76,896
    
    
    $
    106,299
    
    
    
    100.00
    %
    
    $
    106,299
    
    
    $
    56,616
    
    
    
    100.00
    %
    
    $
    56,616Investment securities:Held to maturity:United States government-
sponsored enterprises
    
    $
    49,981
    
    
    
    1.45
    %
    
    $
    50,406
    
    
    $
    1,408,071
    
    
    
    33.74
    %
    
    $
    1,409,814
    
    
    $
    1,533,059
    
    
    
    25.92
    %
    
    $
    1,502,014Municipal bonds
    
    
    105
    
    
    
    0.01
    
    
    
    106
    
    
    
    430
    
    
    
    0.01
    
    
    
    432
    
    
    
    910
    
    
    
    0.02
    
    
    
    920Total held to maturity
    
    
    50,086
    
    
    
    1.46
    
    
    
    50,512
    
    
    
    1,408,501
    
    
    
    33.75
    
    
    
    1,410,246
    
    
    
    1,533,969
    
    
    
    25.94
    
    
    
    1,502,934Available for sale:United States government-
sponsored enterprises
    
    
    3,406,248
    
    
    
    98.33
    
    
    
    3,406,248
    
    
    
    2,758,193
    
    
    
    66.08
    
    
    
    2,758,193
    
    
    
    4,372,295
    
    
    
    73.94
    
    
    
    4,372,295Corporate bonds
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4
    
    
    
    
    
    
    
    4
    
    
    
    57
    
    
    
    
    
    
    
    57Equity securities
    
    
    7,385
    
    
    
    0.21
    
    
    
    7,385
    
    
    
    7,294
    
    
    
    0.17
    
    
    
    7,294
    
    
    
    7,263
    
    
    
    0.12
    
    
    
    7,263Total available for sale
    
    
    3,413,633
    
    
    
    98.54
    
    
    
    3,413,633
    
    
    
    2,765,491
    
    
    
    66.25
    
    
    
    2,765,491
    
    
    
    4,379,615
    
    
    
    74.06
    
    
    
    4,379,615Total investment securities
    
    $
    3,463,719
    
    
    
    100.00
    %
    
    $
    3,464,145
    
    
    $
    4,173,992
    
    
    
    100.00
    %
    
    $
    4,175,737
    
    
    $
    5,913,584
    
    
    
    100.00
    %
    
    $
    5,882,549Mortgage-backed securities:By issuer:Held to maturity:GNMA pass-through
certificates
    
    $
    128,906
    
    
    
    0.66
    %
    
    $
    127,309
    
    
    $
    157,716
    
    
    
    1.08
    %
    
    $
    158,999
    
    
    $
    215,161
    
    
    
    2.31
    %
    
    $
    216,504FNMA pass-through
certificates
    
    
    3,203,799
    
    
    
    16.44
    
    
    
    3,247,847
    
    
    
    3,214,509
    
    
    
    22.06
    
    
    
    3,205,922
    
    
    
    3,233,852
    
    
    
    34.66
    
    
    
    3,191,324FHLMC pass-through
certificates
    
    
    5,859,297
    
    
    
    30.07
    
    
    
    5,943,155
    
    
    
    5,808,288
    
    
    
    39.87
    
    
    
    5,849,744
    
    
    
    3,069,884
    
    
    
    32.90
    
    
    
    3,019,995FHLMC and FNMA
REMICs
    
    
    380,255
    
    
    
    1.95
    
    
    
    377,134
    
    
    
    385,013
    
    
    
    2.64
    
    
    
    351,647
    
    
    
    406,313
    
    
    
    4.36
    
    
    
    376,775Total held to maturity
    
    
    9,572,257
    
    
    
    49.12
    
    
    
    9,695,445
    
    
    
    9,565,526
    
    
    
    65.65
    
    
    
    9,566,312
    
    
    
    6,925,210
    
    
    
    74.23
    
    
    
    6,804,598Available for sale:GNMA pass-through
certificates
    
    
    915,995
    
    
    
    4.70
    
    
    
    915,995
    
    
    
    1,257,893
    
    
    
    8.62
    
    
    
    1,257,893
    
    
    
    1,696,715
    
    
    
    18.18
    
    
    
    1,696,715FNMA pass-through
certificates
    
    
    3,300,888
    
    
    
    16.94
    
    
    
    3,300,888
    
    
    
    1,098,072
    
    
    
    7.54
    
    
    
    1,098,072
    
    
    
    575,293
    
    
    
    6.17
    
    
    
    575,293FHLMC pass-through
certificates
    
    
    5,698,671
    
    
    
    29.24
    
    
    
    5,698,671
    
    
    
    2,649,444
    
    
    
    18.18
    
    
    
    2,649,444
    
    
    
    132,413
    
    
    
    1.42
    
    
    
    132,413Total available for sale
    
    
    9,915,554
    
    
    
    50.88
    
    
    
    9,915,554
    
    
    
    5,005,409
    
    
    
    34.35
    
    
    
    5,005,409
    
    
    
    2,404,421
    
    
    
    25.77
    
    
    
    2,404,421Total mortgage-backed
securities
    
    $
    19,487,811
    
    
    
    100.00
    %
    
    $
    19,610,999
    
    
    $
    14,570,935
    
    
    
    100.00
    %
    
    $
    14,571,721
    
    
    $
    9,329,631
    
    
    
    100.00
    %
    
    $
    9,209,019By coupon type:Adjustable-rate
    
    $
    16,277,336
    
    
    
    83.53
    %
    
    $
    16,377,257
    
    
    $
    11,995,377
    
    
    
    82.32
    %
    
    $
    12,055,525
    
    
    $
    6,495,769
    
    
    
    69.63
    %
    
    $
    6,457,465Fixed-rate
    
    
    3,210,475
    
    
    
    16.47
    
    
    
    3,233,742
    
    
    
    2,575,558
    
    
    
    17.68
    
    
    
    2,516,196
    
    
    
    2,833,862
    
    
    
    30.37
    
    
    
    2,751,554Total mortgage-backed
securities
    
    $
    19,487,811
    
    
    
    100.00
    %
    
    $
    19,610,999
    
    
    $
    14,570,935
    
    
    
    100.00
    %
    
    $
    14,571,721
    
    
    $
    9,329,631
    
    
    
    100.00
    %
    
    $
    9,209,019Total investment portfolio
    
    $
    23,028,426
    
    
    
    
    
    
    $
    23,152,040
    
    
    $
    18,851,226
    
    
    
    
    
    
    $
    18,853,757
    
    
    $
    15,299,831
    
    
    
    
    
    
    $
    15,148,184
 
 (1)
    
    Based on carrying value for each investment type. Page 26




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##### Table of Contents



Carrying Values, Rates and Maturities .
 At December 31, 2008More Than One Year
    
    
    More Than Five YearsOne Year or Less
    
    
    to Five Years
    
    
    to Ten Years
    
    
    More Than Ten Years
    
    
    TotalWeighted
    
    
    
    
    
    
    Weighted
    
    
    
    
    
    
    Weighted
    
    
    
    
    
    
    Weighted
    
    
    
    
    
    
    WeightedCarrying
    
    
    Average
    
    
    Carrying
    
    
    Average
    
    
    Carrying
    
    
    Average
    
    
    Carrying
    
    
    Average
    
    
    Carrying
    
    
    AverageValue
    
    
    Rate
    
    
    Value
    
    
    Rate
    
    
    Value
    
    
    Rate
    
    
    Value
    
    
    Rate
    
    
    Value
    
    
    Rate(Dollars in thousands)Money market investments:Federal funds sold
    
    $
    76,896
    
    
    
    0.25
    %
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    76,896
    
    
    
    0.25
    %Investment securities:Held to maturity:United States government-
sponsored enterprises
    
    $
    
    
    
    
    
    %
    
    $
    
    
    
    
    
    %
    
    $
    
    
    
    
    
    %
    
    $
    49,981
    
    
    
    5.00
    %
    
    $
    49,981
    
    
    
    5.00
    %Municipal bonds
    
    
    
    
    
    
    
    
    
    
    105
    
    
    
    7.58
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    105
    
    
    
    7.58Total held to maturity
    
    
    
    
    
    
    
    
    
    
    105
    
    
    
    7.58
    
    
    
    
    
    
    
    
    
    
    
    49,981
    
    
    
    5.00
    
    
    
    50,086
    
    
    
    5.01Available for sale:United States government-
sponsored enterprises
    
    $
    
    
    
    
    
    %
    
    
    148,176
    
    
    
    4.59
    
    
    
    2,512,954
    
    
    
    4.95
    
    
    
    745,118
    
    
    
    4.91
    
    
    
    3,406,248
    
    
    
    4.93Corporate bonds
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Total available for sale
    
    
    
    
    
    
    
    
    
    
    148,176
    
    
    
    4.59
    
    
    
    2,512,954
    
    
    
    4.95
    
    
    
    745,118
    
    
    
    4.91
    
    
    
    3,406,248
    
    
    
    4.93Total investment securities
    
    $
    
    
    
    
    
    %
    
    $
    148,281
    
    
    
    4.59
    %
    
    $
    2,512,954
    
    
    
    4.95
    %
    
    $
    795,099
    
    
    
    4.92
    %
    
    $
    3,456,334
    
    
    
    4.93
    %Mortgage-backed securities:By issuer:Held to maturity:GNMA pass-through
certificates
    
    $
    40
    
    
    
    8.43
    %
    
    $
    78
    
    
    
    11.15
    %
    
    $
    
    
    
    
    
    %
    
    $
    128,788
    
    
    
    5.09
    %
    
    $
    128,906
    
    
    
    5.09
    %FNMA pass-through
certificates
    
    
    85
    
    
    
    5.73
    
    
    
    
    
    
    
    
    
    
    
    9,497
    
    
    
    6.56
    
    
    
    3,194,217
    
    
    
    5.15
    
    
    
    3,203,799
    
    
    
    5.15FHLMC pass-through
certificates
    
    
    6
    
    
    
    7.87
    
    
    
    581
    
    
    
    6.88
    
    
    
    6,126
    
    
    
    5.41
    
    
    
    5,852,584
    
    
    
    5.33
    
    
    
    5,859,297
    
    
    
    5.33FHLMC and FNMA
REMICs
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    380,255
    
    
    
    4.58
    
    
    
    380,255
    
    
    
    4.58Total held to maturity
    
    
    131
    
    
    
    6.65
    
    
    
    659
    
    
    
    7.39
    
    
    
    15,623
    
    
    
    6.11
    
    
    
    9,555,844
    
    
    
    5.24
    
    
    
    9,572,257
    
    
    
    5.24Available for sale:GNMA pass-through
certificates
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    915,995
    
    
    
    4.68
    
    
    
    915,995
    
    
    
    4.68FNMA pass-through
certificates
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,300,888
    
    
    
    5.26
    
    
    
    3,300,888
    
    
    
    5.26FHLMC pass-through
certificates
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,698,671
    
    
    
    5.42
    
    
    
    5,698,671
    
    
    
    5.42Total available for sale
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    9,915,554
    
    
    
    5.30
    
    
    
    9,915,554
    
    
    
    5.30Total mortgage-backed
securities
    
    $
    131
    
    
    
    6.65
    %
    
    $
    659
    
    
    
    7.39
    %
    
    $
    15,623
    
    
    
    6.11
    %
    
    $
    19,471,398
    
    
    
    5.27
    %
    
    $
    19,487,811
    
    
    
    5.27
    %By coupon type:Adjustable-rate
    
    $
    
    
    
    
    
    %
    
    $
    
    
    
    
    
    %
    
    $
    5,747
    
    
    
    4.95
    %
    
    $
    16,271,589
    
    
    
    5.30
    %
    
    $
    16,277,336
    
    
    
    5.30
    %Fixed-rate
    
    
    131
    
    
    
    6.65
    
    
    
    659
    
    
    
    7.39
    
    
    
    9,876
    
    
    
    6.79
    
    
    
    3,199,809
    
    
    
    5.09
    
    
    
    3,210,475
    
    
    
    5.10Total mortgage-backed
securities
    
    $
    131
    
    
    
    6.65
    %
    
    $
    659
    
    
    
    7.39
    %
    
    $
    15,623
    
    
    
    6.11
    %
    
    $
    19,471,398
    
    
    
    5.27
    %
    
    $
    19,487,811
    
    
    
    5.27
    %Total investment portfolio
    
    $
    77,027
    
    
    
    0.26
    %
    
    $
    148,940
    
    
    
    4.60
    %
    
    $
    2,528,577
    
    
    
    4.96
    %
    
    $
    20,266,497
    
    
    
    5.26
    %
    
    $
    23,021,041
    
    
    
    5.20
    %
 Page 27




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##### Table of Contents



Sources of Funds
 General .
 Deposits .
   Page 28




---



##### Table of Contents



For the Year Ended December 31,2008
    
    
    2007
    
    
    2006(Dollars in thousands)Total deposits at beginning of year
    
    $
    15,153,382
    
    
    $
    13,415,587
    
    
    $
    11,383,300Deposits assumed in Acquisition
    
    
    
    
    
    
    
    
    
    
    1,062,121Net increase in deposits
    
    
    2,729,303
    
    
    
    1,130,859
    
    
    
    534,070Interest credited
    
    
    581,357
    
    
    
    606,936
    
    
    
    436,096Total deposits at end of year
    
    $
    18,464,042
    
    
    $
    15,153,382
    
    
    $
    13,415,587Net increase
    
    $
    3,310,660
    
    
    $
    1,737,795
    
    
    $
    2,032,287Percent increase
    
    
    21.85
    %
    
    
    12.95
    %
    
    
    17.85
    %
  Maturity Period
    
    Amount(In thousands)3 months or less
    
    $
    1,974,828Over 3 months through 6 months
    
    
    2,246,744Over 6 months through 12 months
    
    
    277,486Over 12 months
    
    
    100,170Total
    
    $
    4,599,228
 Page 29




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##### Table of Contents



At December 31,2008
    
    
    2007
    
    
    2006Weighted
    
    
    
    
    
    
    
    
    
    
    Weighted
    
    
    
    
    
    
    
    
    
    
    WeightedPercent
    
    
    average
    
    
    
    
    
    
    Percent
    
    
    average
    
    
    
    
    
    
    Percent
    
    
    averageof total
    
    
    nominal
    
    
    
    
    
    
    of total
    
    
    nominal
    
    
    
    
    
    
    of total
    
    
    nominalAmount
    
    
    deposits
    
    
    rate
    
    
    Amount
    
    
    deposits
    
    
    rate
    
    
    Amount
    
    
    deposits
    
    
    rate(Dollars in thousands)Savings
    
    $
    712,420
    
    
    
    3.86
    %
    
    
    0.76
    %
    
    $
    737,813
    
    
    
    4.87
    %
    
    
    0.74
    %
    
    $
    805,278
    
    
    
    6.00
    %
    
    
    0.92
    %Interest-bearing demand
    
    
    1,573,771
    
    
    
    8.52
    
    
    
    2.47
    
    
    
    1,588,084
    
    
    
    10.48
    
    
    
    3.26
    
    
    
    2,095,811
    
    
    
    15.62
    
    
    
    3.29Money market
    
    
    2,716,429
    
    
    
    14.72
    
    
    
    2.87
    
    
    
    1,575,097
    
    
    
    10.39
    
    
    
    4.26
    
    
    
    918,549
    
    
    
    6.85
    
    
    
    3.59Noninterest-bearing
demand
    
    
    514,196
    
    
    
    2.78
    
    
    
    
    
    
    
    517,970
    
    
    
    3.42
    
    
    
    
    
    
    
    498,301
    
    
    
    3.71
    
    
    
    Total
    
    
    5,516,816
    
    
    
    29.88
    
    
    
    2.22
    
    
    
    4,418,964
    
    
    
    29.16
    
    
    
    2.81
    
    
    
    4,317,939
    
    
    
    32.18
    
    
    
    2.53Time deposits:Time deposits $100,000
and over
    
    
    4,599,228
    
    
    
    24.92
    
    
    
    3.66
    
    
    
    3,336,049
    
    
    
    22.02
    
    
    
    4.97
    
    
    
    2,565,020
    
    
    
    19.12
    
    
    
    5.03Time deposits less than
$100,000 with original
maturities of:3 months or less
    
    
    356,822
    
    
    
    1.93
    
    
    
    3.17
    
    
    
    1,057,289
    
    
    
    6.98
    
    
    
    4.98
    
    
    
    146,921
    
    
    
    1.10
    
    
    
    4.37Over 3 months to
12 months
    
    
    5,520,470
    
    
    
    29.89
    
    
    
    3.74
    
    
    
    4,558,298
    
    
    
    30.07
    
    
    
    5.04
    
    
    
    4,302,331
    
    
    
    32.06
    
    
    
    5.23Over 12 months to
24 months
    
    
    1,200,957
    
    
    
    6.50
    
    
    
    3.56
    
    
    
    524,722
    
    
    
    3.46
    
    
    
    4.57
    
    
    
    557,510
    
    
    
    4.16
    
    
    
    3.82Over 24 months
to 36 months
    
    
    71,707
    
    
    
    0.39
    
    
    
    3.65
    
    
    
    79,613
    
    
    
    0.53
    
    
    
    3.87
    
    
    
    202,276
    
    
    
    1.51
    
    
    
    3.67Over 36 months to
48 months
    
    
    34,469
    
    
    
    0.19
    
    
    
    3.89
    
    
    
    77,185
    
    
    
    0.51
    
    
    
    3.93
    
    
    
    264,204
    
    
    
    1.97
    
    
    
    3.66Over 48 months
to 60 months
    
    
    14,498
    
    
    
    0.08
    
    
    
    4.08
    
    
    
    32,299
    
    
    
    0.21
    
    
    
    3.94
    
    
    
    43,243
    
    
    
    0.32
    
    
    
    3.72Over 60 months
    
    
    109,666
    
    
    
    0.59
    
    
    
    4.27
    
    
    
    138,738
    
    
    
    0.92
    
    
    
    3.98
    
    
    
    164,502
    
    
    
    1.23
    
    
    
    3.99Qualified retirement plans
    
    
    1,039,409
    
    
    
    5.63
    
    
    
    3.78
    
    
    
    930,225
    
    
    
    6.14
    
    
    
    4.70
    
    
    
    851,641
    
    
    
    6.35
    
    
    
    4.47Total time deposits
    
    
    12,947,226
    
    
    
    70.12
    
    
    
    3.69
    
    
    
    10,734,418
    
    
    
    70.84
    
    
    
    4.93
    
    
    
    9,097,648
    
    
    
    67.82
    
    
    
    4.89Total deposits
    
    $
    18,464,042
    
    
    
    100.00
    %
    
    
    3.25
    %
    
    $
    15,153,382
    
    
    
    100.00
    %
    
    
    4.31
    %
    
    $
    13,415,587
    
    
    
    100.00
    %
    
    
    4.13
    %
 Page 30




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##### Table of Contents



At December 31,2008
    
    
    2007
    
    
    2006(In thousands)Time deposit accounts:3.00% or less
    
    $
    1,672,922
    
    
    $
    2,397
    
    
    $
    38,1583.01% to 3.50%
    
    
    3,513,581
    
    
    
    44,450
    
    
    
    457,9953.51% to 4.00%
    
    
    7,278,114
    
    
    
    514,022
    
    
    
    979,9184.01% to 4.50%
    
    
    353,947
    
    
    
    317,633
    
    
    
    1,283,9114.51% to 5.00%
    
    
    127,433
    
    
    
    3,639,404
    
    
    
    482,8475.01% and over
    
    
    1,229
    
    
    
    6,216,512
    
    
    
    5,854,819Total
    
    $
    12,947,226
    
    
    $
    10,734,418
    
    
    $
    9,097,648
  Period to Maturity from December 31, 2008Within
    
    
    Over three
    
    
    Over six
    
    
    Over one
    
    
    Over two
    
    
    Overthree
    
    
    to six
    
    
    months to
    
    
    to two
    
    
    to three
    
    
    threemonths
    
    
    months
    
    
    one year
    
    
    years
    
    
    years
    
    
    years
    
    
    Total(In thousands)Time deposit accounts:3.00% or less
    
    $
    655,316
    
    
    $
    822,257
    
    
    $
    94,607
    
    
    $
    80,918
    
    
    $
    8,846
    
    
    $
    10,978
    
    
    $
    1,672,9223.01% to 3.50%
    
    
    748,224
    
    
    
    1,913,830
    
    
    
    747,111
    
    
    
    97,489
    
    
    
    4,555
    
    
    
    2,372
    
    
    
    3,513,5813.51% to 4.00%
    
    
    3,930,578
    
    
    
    3,227,261
    
    
    
    28,963
    
    
    
    83,525
    
    
    
    4,974
    
    
    
    2,813
    
    
    
    7,278,1144.01% to 4.50%
    
    
    121,080
    
    
    
    11,617
    
    
    
    73,795
    
    
    
    112,801
    
    
    
    12,988
    
    
    
    21,666
    
    
    
    353,9474.51% to 5.00%
    
    
    25,455
    
    
    
    28,590
    
    
    
    48,271
    
    
    
    24,696
    
    
    
    314
    
    
    
    107
    
    
    
    127,4335.01% and over
    
    
    3
    
    
    
    
    
    
    
    
    
    
    
    1,217
    
    
    
    
    
    
    
    9
    
    
    
    1,229Total
    
    $
    5,480,656
    
    
    $
    6,003,555
    
    
    $
    992,747
    
    
    $
    400,646
    
    
    $
    31,677
    
    
    $
    37,945
    
    
    $
    12,947,226
 Borrowings.
 .
 Page 31




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##### Table of Contents



2008
    
    
    2007Weighted
    
    
    
    
    
    
    WeightedAverage
    
    
    
    
    
    
    AveragePrincipal
    
    
    Rate
    
    
    Principal
    
    
    Rate(Dollars in thousands)Securities sold under agreements to repurchase:FHLB
    
    $
    2,400,000
    
    
    
    4.44
    %
    
    $
    2,066,000
    
    
    
    4.62
    %Other brokers
    
    
    12,700,000
    
    
    
    3.91
    
    
    
    9,950,000
    
    
    
    4.15Total securities sold under agreements to repurchase
    
    
    15,100,000
    
    
    
    3.99
    
    
    
    12,016,000
    
    
    
    4.23Advances from the FHLB
    
    
    15,125,000
    
    
    
    3.94
    
    
    
    12,125,000
    
    
    
    4.20Total borrowed funds
    
    $
    30,225,000
    
    
    
    3.97
    %
    
    $
    24,141,000
    
    
    
    4.22
    %Accrued interest payable
    
    $
    138,351
    
    
    
    
    
    
    $
    115,012
  At or for the Year Ended December 31,2008
    
    
    2007
    
    
    2006(Dollars in thousands)Repurchase Agreements:Average balance outstanding during the year
    
    $
    13,465,540
    
    
    $
    10,305,216
    
    
    $
    8,313,321Maximum balance outstanding at any month-end
during the year
    
    $
    15,100,000
    
    
    $
    12,016,000
    
    
    $
    8,923,000Weighted average rate during the period
    
    
    4.17
    %
    
    
    4.20
    %
    
    
    3.81
    %FHLB Advances:Average balance outstanding during the year
    
    $
    13,737,057
    
    
    $
    10,286,869
    
    
    $
    5,977,115Maximum balance outstanding at any month-end
during the year
    
    $
    15,125,000
    
    
    $
    12,125,000
    
    
    $
    8,050,000Weighted average rate during the period
    
    
    4.14
    %
    
    
    4.28
    %
    
    
    4.17
    %
   Page 32




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##### Table of Contents



Borrowings by Scheduled
    
    
    Borrowings by Earlier of ScheduledMaturity Date
    
    
    Maturity or Next Potential Call DateWeighted
    
    
    
    
    
    
    WeightedAverage
    
    
    
    
    
    
    AverageYear
    
    Principal
    
    
    Rate
    
    
    Principal
    
    
    Rate(Dollars in thousands)2009
    
    $
    600,000
    
    
    
    2.02
    %
    
    $
    21,725,000
    
    
    
    4.17
    %2010
    
    
    300,000
    
    
    
    5.68
    
    
    
    2,850,000
    
    
    
    3.702011
    
    
    250,000
    
    
    
    4.90
    
    
    
    5,050,000
    
    
    
    3.212012
    
    
    100,000
    
    
    
    4.76
    
    
    
    600,000
    
    
    
    4.332013
    
    
    250,000
    
    
    
    5.30
    
    
    
    
    
    
    
    2014
    
    
    350,000
    
    
    
    3.37
    
    
    
    
    
    
    
    2015
    
    
    3,725,000
    
    
    
    3.85
    
    
    
    
    
    
    
    2016
    
    
    8,075,000
    
    
    
    4.32
    
    
    
    
    
    
    
    2017
    
    
    10,725,000
    
    
    
    4.22
    
    
    
    
    
    
    
    2018
    
    
    5,850,000
    
    
    
    3.13
    
    
    
    
    
    
    
    Total
    
    $
    30,225,000
    
    
    
    3.97
    
    
    $
    30,225,000
    
    
    
    3.97
   At or for the Year Ended December 31,2008
    
    
    2007
    
    
    2006(Dollars in thousands)Amortized cost of collateral:United States government-sponsored enterprise securities
    
    $
    2,150,000
    
    
    $
    3,620,083
    
    
    $
    3,329,639Mortgage-backed securities
    
    
    15,572,838
    
    
    
    9,308,551
    
    
    
    6,257,678Total amortized cost of collateral
    
    $
    17,722,838
    
    
    $
    12,928,634
    
    
    $
    9,587,317Fair value of collateral:United States government-sponsored enterprise securities
    
    $
    2,159,471
    
    
    $
    3,626,572
    
    
    $
    3,195,765Mortgage-backed securities
    
    
    15,759,490
    
    
    
    9,294,264
    
    
    
    6,143,223Total fair value of collateral
    
    $
    17,918,961
    
    
    $
    12,920,836
    
    
    $
    9,338,988
 Page 33




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##### Table of Contents



Subsidiaries
   Personnel
  REGULATION OF HUDSON CITY SAVINGS BANK AND HUDSON CITY BANCORP
 General
   Page 34




---



##### Table of Contents



Federally Chartered Savings Bank Regulation
 Activity Powers.
  Capital Requirements.
   Page 35




---



##### Table of Contents



OTS RequirementsMinimum Capital
    
    For Classification asBank Actual
    
    Adequacy
    
    Well-CapitalizedAmount
    
    Ratio
    
    Amount
    
    Ratio
    
    Amount
    
    Ratio(Dollars in thousands)December 31, 2008Tangible capital
    
    $
    4,290,316
    
    
    
    7.99
    %
    
    $
    805,475
    
    
    
    1.50
    %
    
    
    n/a
    
    
    
    n/aLeverage (core) capital
    
    
    4,290,316
    
    
    
    7.99
    
    
    
    2,147,935
    
    
    
    4.00
    
    
    $
    2,684,918
    
    
    
    5.00
    %Total-risk-based capital
    
    
    4,340,315
    
    
    
    21.52
    
    
    
    1,613,657
    
    
    
    8.00
    
    
    
    2,017,071
    
    
    
    10.00December 31, 2007Tangible capital
    
    $
    4,055,952
    
    
    
    9.16
    %
    
    $
    664,169
    
    
    
    1.50
    %
    
    
    n/a
    
    
    
    n/aLeverage (core) capital
    
    
    4,055,952
    
    
    
    9.16
    
    
    
    1,771,118
    
    
    
    4.00
    
    
    $
    2,213,898
    
    
    
    5.00
    %Total-risk-based capital
    
    
    4,090,693
    
    
    
    24.83
    
    
    
    1,318,102
    
    
    
    8.00
    
    
    
    1,647,627
    
    
    
    10.00
    Safety and Soundness Standards.
 Page 36




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##### Table of Contents



Prompt Corrective Action.
  1.
    
    an amount equal to five percent of the banks total assets at the time it became
undercapitalized; and2.
    
    the amount that is necessary (or would have been necessary) to bring the bank
into compliance with all capital standards applicable with respect to such bank as of
the time it fails to comply with the plan.
  Insurance Activities.
 Deposit Insurance.
  Page 37




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##### Table of Contents



Temporary Liquidity Guarantee Program.
 Page 38




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Transactions with Affiliates of Hudson City Savings.
   Privacy Standards.
  Page 39




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Community Reinvestment Act.
  
    
    a lending test, to evaluate the institutions record of making loans in its
service areas;
    
    an investment test, to evaluate the institutions record of investing in
community development projects, affordable housing, and programs benefiting low or
moderate income individuals and businesses; and
    
    a service test, to evaluate the institutions delivery of services through its
branches, ATMs and other offices.
  Loans to One Borrower.
 Page 40




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Interagency Guidance on Nontraditional Mortgage Product Risks.
    OTS Guidance on Commercial Real Estate Lending.
 Page 41




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Qualified Thrift Lender (QTL) Test.
  Limitation on Capital Distributions.
    Page 42




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Liquidity.
 Assessments.
 Branching.
 Anti-Money Laundering and Customer Identification
   
    
    Establishment of anti-money laundering programs.
    
    Establishment of a program specifying procedures for obtaining identifying
information from customers seeking to open new accounts, including verifying the
identity of customers within a reasonable period of time.
    
    Establishment of enhanced due diligence policies, procedures and controls
designed to detect and report money-laundering.
    
    Prohibitions on correspondent accounts for foreign shell banks and compliance
with record keeping obligations with respect to correspondent accounts of foreign
banks.
    
    Bank regulators are directed to consider a holding companys effectiveness in
combating money laundering when ruling on Federal Reserve Act and Bank Merger Act
applications.
 Page 43




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Federal Home Loan Bank System
   Federal Reserve System
   Page 44




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Federal Holding Company Regulation
  Restrictions Applicable to New Savings and Loan Holding Companies.
 
    
    furnishing or performing management services for a savings institution subsidiary
of such holding company;
    
    conducting an insurance agency or escrow business;
    
    holding, managing, or liquidating assets owned or acquired from a savings
institution subsidiary of such company;
    
    holding or managing properties used or occupied by a savings institution
subsidiary of such company;
    
    acting as trustee under a deed of trust;
    
    any other activity (i) that the FRB, by regulation, has determined to be
permissible for bank holding companies under Section 4(c) of the Bank Holding
Company Act of 1956 (the BHC Act), unless the Director of the OTS, by regulation,
prohibits or limits any such
activity for savings and loan holding companies, or (ii) which multiple savings and
loan holding companies were authorized by regulation to directly engage in on March 5,
1987;
    
    purchasing, holding, or disposing of stock acquired in connection with a
qualified stock issuance if the purchase of such stock by such holding company is
approved by the Director of the OTS; and
    
    any activity permissible for financial holding companies under section 4(k) of
the BHC Act.
  
    
    lending, exchanging, transferring, investing for others, or safeguarding money or
securities;
 Page 45




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##### Table of Contents




    
    insurance activities or providing and issuing annuities, and acting as principal,
agent, or broker;
    
    financial, investment, or economic advisory services;
    
    issuing or selling instruments representing interests in pools of assets that a
bank is permitted to hold directly;
    
    underwriting, dealing in, or making a market in securities;
    
    activities previously determined by the FRB to be closely related to banking;
    
    activities that bank holding companies are permitted to engage in outside of the
U.S.; and
    
    portfolio investments made by an insurance company.
  Restrictions Applicable to All Savings and Loan Holding Companies.
 
    
    control (as defined under HOLA) of another savings institution (or a holding
company parent) without prior OTS approval;
    
    through merger, consolidation, or purchase of assets, another savings institution
or a holding company thereof, or acquiring all or substantially all of the assets of
such institution (or a holding company) without prior OTS approval; or
    
    control of any depository institution not insured by the FDIC (except through a
merger with and into the holding companys savings institution subsidiary that is
approved by the OTS).
  
    
    in the case of certain emergency acquisitions approved by the FDIC;
    
    if such holding company controls a savings institution subsidiary that operated a
home or branch office in such additional state as of March 5, 1987; or
    
    if the laws of the state in which the savings institution to be acquired is
located specifically authorize a savings institution chartered by that state to be
acquired by a savings institution chartered by the state where the acquiring savings
institution or savings and loan holding company is located or by a holding company
that controls such a state chartered association.
  Page 46




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Federal Securities Law
  Delaware Corporation Law
  TAXATION
 Federal
 General.
 Page 47




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Distributions.
  Corporate Alternative Minimum Tax.
 Elimination of Dividends; Dividends Received Deduction.
 State
 New Jersey State Taxation.
  Page 48




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Delaware State Taxation.
 New York State Taxation.
 Connecticut State Taxation.
 New York City Taxation.
 
 Item 1A. Risk Factors.
 The Geographic Concentration Of Our Loan Portfolio And Lending Activities Makes Us Vulnerable To A
Downturn In The Economy.
  Page 49




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The Impact On Us Of Recently Enacted And Proposed Legislation And Government Programs To Stabilize
The Financial Markets Cannot Be Predicted At This Time.
   Page 50




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Changes In Interest Rates Could Adversely Affect Our Results of Operations And Financial Condition.
 Page 51




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Page 52




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Because We Compete Primarily On The Basis Of The Interest Rates We Offer Depositors And The Terms
Of Loans We Offer Borrowers, Our Margins Could Decrease If We Were Required To Increase Deposit
Rates Or Lower Interest Rates On Loans In Response To Competitive Pressures.
    We May Not Be Able To Successfully Implement Our Plans For Growth.
  Page 53




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We
Operate In A Highly Regulated Industry, Which Limits The Manner And Scope Of Our Business
Activities.
  
 Item 1B. Unresolved Staff Comments.
  
 Item 2. Properties.
   
 Item 3. Legal Proceedings.
  
 Item 4. Submission of Matters to a Vote of Security Holders.
 .
 Page 54




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PART II
 
 Item 5. Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases
of Equity Securities.
  Sales Price
    
    Dividend InformationAmountHigh
    
    Low
    
    Per Share
    
    Date of Payment2007First quarter
    
    14.25
    
    13.11
    
    0.080
    
    March 1, 2007Second quarter
    
    13.83
    
    12.11
    
    0.080
    
    June 1, 2007Third quarter
    
    15.66
    
    11.45
    
    0.085
    
    September 3, 2007Fourth quarter
    
    16.08
    
    14.10
    
    0.085
    
    December 3, 20072008First quarter
    
    18.65
    
    13.28
    
    0.090
    
    March 1, 2008Second quarter
    
    19.78
    
    16.07
    
    0.110
    
    May 31, 2008Third quarter
    
    25.05
    
    15.55
    
    0.120
    
    August 29, 2008Fourth quarter
    
    19.41
    
    14.00
    
    0.130
    
    November 29, 2008
    Page 55




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MaximumTotal Number of
    
    Number of SharesTotal
    
    
    
    
    
    Shares Purchased
    
    that May Yet BeNumber of
    
    Average
    
    as Part of Publicly
    
    Purchased UnderShares
    
    Price Paid
    
    Announced Plans
    
    the Plans orPeriod
    
    Purchased
    
    per Share
    
    or Programs
    
    Programs (1)October 1-October 31, 2008
    
    
    
    
    
    $
    
    
    
    
    
    
    
    
    54,973,550November 1-November 30, 2008
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    54,973,550December 1-December 31, 2008
    
    
    900,000
    
    
    
    14.94
    
    
    
    900,000
    
    
    
    54,073,550Total
    
    
    900,000
    
    
    
    14.94
    
    
    
    900,000
 
 (1)
    
    On June 20, 2006, Hudson City Bancorp announced the adoption of its seventh Stock Repurchase Program, which authorized the repurchase of up to
56,975,000 shares of common stock. This program has no expiration date and has 2,673,550 shares yet to be purchased as of December 31, 2008.
On July 25, 2007, Hudson City Bancorp announced the adoption of its eighth Stock Repurchase Program, which authorized the repurchase
of up to 51,400,000 shares of common stock. This program has no expiration date and no shares have been
purchased pursuant to this program. Page 56




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Performance Graph
  Hudson City Bancorp, Inc. Total Return Performance
 
 12/31/03
    
    12/31/04
    
    12/31/05
    
    12/31/06
    
    12/31/07
    
    12/31/08Hudson City Bancorp, Inc.
    
    
    100
    
    
    
    98
    
    
    
    106
    
    
    
    124
    
    
    
    138
    
    
    
    150SNL Thrift Index
    
    
    100
    
    
    
    111
    
    
    
    115
    
    
    
    134
    
    
    
    81
    
    
    
    51S&P 500 Index
    
    
    100
    
    
    
    111
    
    
    
    116
    
    
    
    135
    
    
    
    142
    
    
    
    90
 
 *
    
    Source: SNL Financial LC and Bloomberg Financial DatabaseThere can be no assurance that stock performance will continue in the future with the same or
similar trends as those depicted in the graph above. Page 57




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Item 6. Selected Financial Data.
  At December 31,2008
    
    2007
    
    2006
    
    2005
    
    2004(In thousands)Selected Financial Condition Data:Total assets
    
    $
    54,145,328
    
    
    $
    44,423,971
    
    
    $
    35,506,581
    
    
    $
    28,075,353
    
    
    $
    20,145,981Total loans
    
    
    29,418,888
    
    
    
    24,192,281
    
    
    
    19,083,617
    
    
    
    15,062,449
    
    
    
    11,363,039Federal Home Loan Bank of New York stock
    
    
    865,570
    
    
    
    695,351
    
    
    
    445,006
    
    
    
    226,962
    
    
    
    140,000Investment securities held to maturity
    
    
    50,086
    
    
    
    1,408,501
    
    
    
    1,533,969
    
    
    
    1,534,216
    
    
    
    1,334,249Investment securities available for sale
    
    
    3,413,633
    
    
    
    2,765,491
    
    
    
    4,379,615
    
    
    
    3,962,511
    
    
    
    1,594,639Mortgage-backed securities held to maturity
    
    
    9,572,257
    
    
    
    9,565,526
    
    
    
    6,925,210
    
    
    
    4,389,864
    
    
    
    3,755,921Mortgage-backed securities available for sale
    
    
    9,915,554
    
    
    
    5,005,409
    
    
    
    2,404,421
    
    
    
    2,520,633
    
    
    
    1,620,708Total cash and cash equivalents
    
    
    261,811
    
    
    
    217,544
    
    
    
    182,246
    
    
    
    102,259
    
    
    
    168,183Foreclosed real estate, net
    
    
    15,532
    
    
    
    4,055
    
    
    
    3,161
    
    
    
    1,040
    
    
    
    878Total deposits
    
    
    18,464,042
    
    
    
    15,153,382
    
    
    
    13,415,587
    
    
    
    11,383,300
    
    
    
    11,477,300Total borrowed funds
    
    
    30,225,000
    
    
    
    24,141,000
    
    
    
    16,973,000
    
    
    
    11,350,000
    
    
    
    7,150,000Total stockholders equity
    
    
    4,938,796
    
    
    
    4,611,307
    
    
    
    4,930,256
    
    
    
    5,201,476
    
    
    
    1,402,884
 For the Year Ended December 31,2008
    
    
    2007
    
    
    2006
    
    
    2005
    
    
    2004(In thousands)Selected Operating Data:Total interest and dividend income
    
    $
    2,653,225
    
    
    $
    2,127,505
    
    
    $
    1,614,843
    
    
    $
    1,178,908
    
    
    $
    915,058Total interest expense
    
    
    1,711,248
    
    
    
    1,480,322
    
    
    
    1,001,610
    
    
    
    616,774
    
    
    
    430,066Net interest income
    
    
    941,977
    
    
    
    647,183
    
    
    
    613,233
    
    
    
    562,134
    
    
    
    484,992Provision for loan losses
    
    
    19,500
    
    
    
    4,800
    
    
    
    
    
    
    
    65
    
    
    
    790Net interest income after provision for loan losses
    
    
    922,477
    
    
    
    642,383
    
    
    
    613,233
    
    
    
    562,069
    
    
    
    484,202Non-interest income:Service charges and other income
    
    
    8,485
    
    
    
    7,267
    
    
    
    6,287
    
    
    
    5,267
    
    
    
    5,128Gains on securities transactions, net
    
    
    
    
    
    
    6
    
    
    
    4
    
    
    
    2,740
    
    
    
    11,429Total non-interest income
    
    
    8,485
    
    
    
    7,273
    
    
    
    6,291
    
    
    
    8,007
    
    
    
    16,557Total non-interest expense
    
    
    198,076
    
    
    
    167,913
    
    
    
    158,955
    
    
    
    127,703
    
    
    
    118,348Income before income tax expense
    
    
    732,886
    
    
    
    481,743
    
    
    
    460,569
    
    
    
    442,373
    
    
    
    382,411Income tax expense
    
    
    287,328
    
    
    
    185,885
    
    
    
    171,990
    
    
    
    166,318
    
    
    
    143,145Net income
    
    $
    445,558
    
    
    $
    295,858
    
    
    $
    288,579
    
    
    $
    276,055
    
    
    $
    239,266
 Page 58




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At or for the Year Ended December 31,2008
    
    2007
    
    2006
    
    2005
    
    2004Selected Financial Ratios and Other Data:Performance Ratios:Return on average assets
    
    
    0.91
    %
    
    
    0.74
    %
    
    
    0.91
    %
    
    
    1.14
    %
    
    
    1.29
    %Return on average stockholders equity
    
    
    9.36
    
    
    
    6.23
    
    
    
    5.70
    
    
    
    7.52
    
    
    
    17.66Net interest rate spread (1)
    
    
    1.57
    
    
    
    1.11
    
    
    
    1.31
    
    
    
    1.84
    
    
    
    2.43Net interest margin (2)
    
    
    1.96
    
    
    
    1.65
    
    
    
    1.96
    
    
    
    2.35
    
    
    
    2.66Non-interest expense to average assets
    
    
    0.41
    
    
    
    0.42
    
    
    
    0.50
    
    
    
    0.53
    
    
    
    0.64Efficiency ratio (3)
    
    
    20.84
    
    
    
    25.66
    
    
    
    25.66
    
    
    
    22.40
    
    
    
    23.60Average interest-earning assets to
average interest-bearing liabilities
    
    
    1.11
    x
    
    
    1.14
    x
    
    
    1.20
    x
    
    
    1.20
    x
    
    
    1.09
    xShare and Per Share Data:Basic earnings per share
    
    $
    0.92
    
    
    $
    0.59
    
    
    $
    0.54
    
    
    $
    0.49
    
    
    $
    0.41Diluted earnings per share
    
    
    0.90
    
    
    
    0.58
    
    
    
    0.53
    
    
    
    0.48
    
    
    
    0.40Cash dividends paid per common share
    
    
    0.45
    
    
    
    0.33
    
    
    
    0.30
    
    
    
    0.27
    
    
    
    0.22Dividend pay-out ratio (4)
    
    
    48.91
    %
    
    
    55.93
    %
    
    
    55.56
    %
    
    
    54.69
    %
    
    
    53.17
    %Book value per share (5)
    
    $
    10.10
    
    
    $
    9.55
    
    
    $
    9.47
    
    
    $
    9.44
    
    
    $
    7.85Tangible book value per share (5)
    
    
    9.77
    
    
    
    9.22
    
    
    
    9.15
    
    
    
    9.44
    
    
    
    7.85Weighted average number of common
shares outstanding:Basic
    
    
    484,907,441
    
    
    
    499,607,828
    
    
    
    536,214,778
    
    
    
    567,789,397
    
    
    
    576,621,209Diluted
    
    
    495,856,156
    
    
    
    509,927,433
    
    
    
    546,790,604
    
    
    
    581,063,426
    
    
    
    593,000,573Capital Ratios:Average stockholders equity to average assets
    
    
    9.74
    %
    
    
    11.93
    %
    
    
    16.00
    %
    
    
    15.10
    %
    
    
    7.29
    %Stockholders equity to assets
    
    
    9.12
    
    
    
    10.38
    
    
    
    13.89
    
    
    
    18.53
    
    
    
    6.96Regulatory Capital Ratios of Bank:Leverage capital
    
    
    7.99
    %
    
    
    9.16
    %
    
    
    11.30
    %
    
    
    14.68
    %
    
    
    6.36
    %Total risk-based capital
    
    
    21.52
    
    
    
    24.83
    
    
    
    30.99
    
    
    
    41.31
    
    
    
    17.49Asset Quality Ratios:Non-performing loans to total loans
    
    
    0.74
    %
    
    
    0.33
    %
    
    
    0.16
    %
    
    
    0.13
    %
    
    
    0.19
    %Non-performing assets to total assets
    
    
    0.43
    
    
    
    0.19
    
    
    
    0.09
    
    
    
    0.07
    
    
    
    0.11Allowance for loan losses to non-performing loans
    
    
    22.89
    
    
    
    43.75
    
    
    
    102.09
    
    
    
    141.84
    
    
    
    126.44Allowance for loan losses to total loans
    
    
    0.17
    
    
    
    0.14
    
    
    
    0.16
    
    
    
    0.18
    
    
    
    0.24Branch and Deposit Data:Number of deposit accounts
    
    
    638,951
    
    
    
    605,018
    
    
    
    580,987
    
    
    
    484,956
    
    
    
    476,627Branches
    
    
    127
    
    
    
    119
    
    
    
    111
    
    
    
    90
    
    
    
    85Average deposits per branch (thousands)
    
    $
    145,386
    
    
    $
    127,339
    
    
    $
    120,861
    
    
    $
    126,481
    
    
    $
    135,027
 
 (1)
    
    Determined by subtracting the weighted average cost of average total interest-bearing liabilities from the weighted average yield
on average total interest-earning assets.(2)
    
    Determined by dividing net interest income by average total interest-earning assets.(3)
    
    Determined by dividing total non-interest expense by the sum of net interest income and total non-interest income.(4)
    
    The dividend pay-out ratio for 2004 and 2005 uses per share information that does not reflect the dividend waiver by Hudson City, MHC.(5)
    
    Computed based on total common shares issued, less treasury shares, unallocated ESOP shares and unvested stock award shares. Tangible book value excludes goodwill and other intangible assets. Page 59




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Item 7. Managements Discussion and Analysis of Financial Condition and Results of Operations.
 .
 Executive Summary
     Page 60




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Comparison of Financial Condition at December 31, 2008 and December 31, 2007
      Page 63




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Page 64




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Analysis of Net Interest Income
  Page 66




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Average Balance Sheet.
 For the Year Ended December 31,2008
    
    
    2007
    
    
    2006Average
    
    
    
    
    
    
    
    
    
    
    Average
    
    
    
    
    
    
    
    
    
    
    AverageAverage
    
    
    
    
    
    
    Yield/
    
    
    Average
    
    
    
    
    
    
    Yield/
    
    
    Average
    
    
    
    
    
    
    Yield/Balance
    
    
    Interest
    
    
    Cost
    
    
    Balance
    
    
    Interest
    
    
    Cost
    
    
    Balance
    
    
    Interest
    
    
    Cost(Dollars in thousands)Assets:Interest-earning assets:First mortgage loans, net (1)
    
    $
    26,379,724
    
    
    $
    1,523,521
    
    
    
    5.78
    %
    
    $
    21,208,167
    
    
    $
    1,205,461
    
    
    
    5.68
    %
    
    $
    16,685,920
    
    
    $
    932,550
    
    
    
    5.59
    %Consumer and other loans
    
    
    422,097
    
    
    
    26,184
    
    
    
    6.20
    
    
    
    431,491
    
    
    
    28,247
    
    
    
    6.55
    
    
    
    316,844
    
    
    
    19,698
    
    
    
    6.22Federal funds sold
    
    
    209,607
    
    
    
    4,295
    
    
    
    2.05
    
    
    
    248,201
    
    
    
    12,293
    
    
    
    4.95
    
    
    
    165,380
    
    
    
    8,242
    
    
    
    4.98Mortgage-backed securities,
at amortized cost
    
    
    16,694,279
    
    
    
    875,008
    
    
    
    5.24
    
    
    
    11,391,487
    
    
    
    587,905
    
    
    
    5.16
    
    
    
    8,022,309
    
    
    
    381,995
    
    
    
    4.76Federal Home Loan Bank stock
    
    
    790,305
    
    
    
    48,009
    
    
    
    6.07
    
    
    
    586,021
    
    
    
    39,492
    
    
    
    6.74
    
    
    
    345,870
    
    
    
    16,507
    
    
    
    4.77Investment securities, at amortized cost
    
    
    3,602,206
    
    
    
    176,208
    
    
    
    4.89
    
    
    
    5,358,155
    
    
    
    254,107
    
    
    
    4.74
    
    
    
    5,697,565
    
    
    
    255,851
    
    
    
    4.49Total interest-earning assets
    
    
    48,098,218
    
    
    
    2,653,225
    
    
    
    5.52
    
    
    
    39,223,522
    
    
    
    2,127,505
    
    
    
    5.42
    
    
    
    31,233,888
    
    
    
    1,614,843
    
    
    
    5.17Noninterest-earning assets
    
    
    788,032
    
    
    
    
    
    
    
    
    
    
    
    621,860
    
    
    
    
    
    
    
    
    
    
    
    414,084Total assets
    
    $
    48,886,250
    
    
    
    
    
    
    
    
    
    
    $
    39,845,382
    
    
    
    
    
    
    
    
    
    
    $
    31,647,972Liabilities and stockholders equity:Interest-bearing liabilities:Savings accounts
    
    $
    724,943
    
    
    
    5,485
    
    
    
    0.76
    
    
    $
    775,802
    
    
    
    6,330
    
    
    
    0.82
    
    
    $
    796,410
    
    
    
    7,851
    
    
    
    0.99Interest-bearing transaction accounts
    
    
    1,578,419
    
    
    
    48,444
    
    
    
    3.07
    
    
    
    1,806,203
    
    
    
    60,641
    
    
    
    3.36
    
    
    
    2,734,787
    
    
    
    90,936
    
    
    
    3.33Money market accounts
    
    
    2,227,261
    
    
    
    73,180
    
    
    
    3.29
    
    
    
    1,176,185
    
    
    
    47,172
    
    
    
    4.01
    
    
    
    688,311
    
    
    
    20,670
    
    
    
    3.00Time deposits
    
    
    11,546,958
    
    
    
    454,248
    
    
    
    3.93
    
    
    
    10,005,377
    
    
    
    492,793
    
    
    
    4.93
    
    
    
    7,417,812
    
    
    
    316,639
    
    
    
    4.27Total interest-bearing deposits
    
    
    16,077,581
    
    
    
    581,357
    
    
    
    3.62
    
    
    
    13,763,567
    
    
    
    606,936
    
    
    
    4.41
    
    
    
    11,637,320
    
    
    
    436,096
    
    
    
    3.75Repurchase agreements
    
    
    13,465,540
    
    
    
    561,301
    
    
    
    4.17
    
    
    
    10,305,216
    
    
    
    432,852
    
    
    
    4.20
    
    
    
    8,313,321
    
    
    
    316,444
    
    
    
    3.81FHLB advances
    
    
    13,737,057
    
    
    
    568,590
    
    
    
    4.14
    
    
    
    10,286,869
    
    
    
    440,534
    
    
    
    4.28
    
    
    
    5,977,115
    
    
    
    249,070
    
    
    
    4.17Total borrowed funds
    
    
    27,202,597
    
    
    
    1,129,891
    
    
    
    4.15
    
    
    
    20,592,085
    
    
    
    873,386
    
    
    
    4.24
    
    
    
    14,290,436
    
    
    
    565,514
    
    
    
    3.96Total interest-bearing liabilities
    
    
    43,280,178
    
    
    
    1,711,248
    
    
    
    3.95
    
    
    
    34,355,652
    
    
    
    1,480,322
    
    
    
    4.31
    
    
    
    25,927,756
    
    
    
    1,001,610
    
    
    
    3.86Noninterest-bearing liabilities:Noninterest-bearing deposits
    
    
    554,584
    
    
    
    
    
    
    
    
    
    
    
    514,685
    
    
    
    
    
    
    
    
    
    
    
    462,022Other noninterest-bearing liabilities
    
    
    289,930
    
    
    
    
    
    
    
    
    
    
    
    222,760
    
    
    
    
    
    
    
    
    
    
    
    195,845Total noninterest-bearing liabilities
    
    
    844,514
    
    
    
    
    
    
    
    
    
    
    
    737,445
    
    
    
    
    
    
    
    
    
    
    
    657,867Total liabilities
    
    
    44,124,692
    
    
    
    
    
    
    
    
    
    
    
    35,093,097
    
    
    
    
    
    
    
    
    
    
    
    26,585,623Stockholders equity
    
    
    4,761,558
    
    
    
    
    
    
    
    
    
    
    
    4,752,285
    
    
    
    
    
    
    
    
    
    
    
    5,062,349Total liabilities and
stockholders equity
    
    $
    48,886,250
    
    
    
    
    
    
    
    
    
    
    $
    39,845,382
    
    
    
    
    
    
    
    
    
    
    $
    31,647,972Net interest income
    
    
    
    
    
    $
    941,977
    
    
    
    
    
    
    
    
    
    
    $
    647,183
    
    
    
    
    
    
    
    
    
    
    $
    613,233Net interest rate spread (2)
    
    
    
    
    
    
    
    
    
    
    1.57
    %
    
    
    
    
    
    
    
    
    
    
    1.11
    %
    
    
    
    
    
    
    
    
    
    
    1.31
    %Net interest-earning assets
    
    $
    4,818,040
    
    
    
    
    
    
    
    
    
    
    $
    4,867,870
    
    
    
    
    
    
    
    
    
    
    $
    5,306,132Net interest margin (3)
    
    
    
    
    
    
    
    
    
    
    1.96
    %
    
    
    
    
    
    
    
    
    
    
    1.65
    %
    
    
    
    
    
    
    
    
    
    
    1.96
    %Ratio of interest-earning assets to
interest-bearing liabilities
    
    
    
    
    
    
    
    
    
    
    1.11
    x
    
    
    
    
    
    
    
    
    
    
    1.14
    x
    
    
    
    
    
    
    
    
    
    
    1.20
    x
 
 (1)
    
    Amount is net of deferred loan costs and allowance for loan losses and includes non-performing loans.(2)
    
    Determined by subtracting the weighted average cost of average total interest-bearing liabilities from the weighted average yield on average total interest-earning assets.(3)
    
    Determined by dividing net interest income by average total interest-earning assets. Page 67




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Rate/Volume Analysis.
 
    
    changes attributable to changes in volume (changes in volume multiplied by prior
rate);
    
    changes attributable to changes in rate (changes in rate multiplied by prior volume);
and
    
    the net change.
  2008 Compared to 2007
    
    
    2007 Compared to 2006Increase (Decrease) Due To
    
    
    Increase (Decrease) Due ToVolume
    
    
    Rate
    
    
    Net
    
    
    Volume
    
    
    Rate
    
    
    Net(In thousands)Interest-earning assets:First mortgage loans, net
    
    $
    296,643
    
    
    $
    21,417
    
    
    $
    318,060
    
    
    $
    257,608
    
    
    $
    15,303
    
    
    $
    272,911Consumer and other loans
    
    
    (597
    )
    
    
    (1,466
    )
    
    
    (2,063
    )
    
    
    7,455
    
    
    
    1,094
    
    
    
    8,549Federal funds sold
    
    
    (1,677
    )
    
    
    (6,321
    )
    
    
    (7,998
    )
    
    
    4,101
    
    
    
    (50
    )
    
    
    4,051Mortgage-backed securities
    
    
    277,849
    
    
    
    9,254
    
    
    
    287,103
    
    
    
    171,579
    
    
    
    34,331
    
    
    
    205,910Federal Home Loan Bank stock
    
    
    12,737
    
    
    
    (4,220
    )
    
    
    8,517
    
    
    
    14,412
    
    
    
    8,573
    
    
    
    22,985Investment securities
    
    
    (85,698
    )
    
    
    7,799
    
    
    
    (77,899
    )
    
    
    (15,627
    )
    
    
    13,883
    
    
    
    (1,744
    )Total
    
    
    499,257
    
    
    
    26,463
    
    
    
    525,720
    
    
    
    439,528
    
    
    
    73,134
    
    
    
    512,662Interest-bearing liabilities:Savings accounts
    
    
    (400
    )
    
    
    (445
    )
    
    
    (845
    )
    
    
    (199
    )
    
    
    (1,322
    )
    
    
    (1,521
    )Interest-bearing transaction accounts
    
    
    (7,241
    )
    
    
    (4,956
    )
    
    
    (12,197
    )
    
    
    (31,110
    )
    
    
    815
    
    
    
    (30,295
    )Money market accounts
    
    
    35,760
    
    
    
    (9,752
    )
    
    
    26,008
    
    
    
    17,968
    
    
    
    8,534
    
    
    
    26,502Time deposits
    
    
    69,745
    
    
    
    (108,290
    )
    
    
    (38,545
    )
    
    
    122,066
    
    
    
    54,088
    
    
    
    176,154Repurchase agreements
    
    
    131,568
    
    
    
    (3,119
    )
    
    
    128,449
    
    
    
    81,563
    
    
    
    34,845
    
    
    
    116,408FHLB advances
    
    
    142,921
    
    
    
    (14,865
    )
    
    
    128,056
    
    
    
    184,706
    
    
    
    6,758
    
    
    
    191,464Total
    
    
    372,353
    
    
    
    (141,427
    )
    
    
    230,926
    
    
    
    374,994
    
    
    
    103,718
    
    
    
    478,712Net change in net
interest income
    
    $
    126,904
    
    
    $
    167,890
    
    
    $
    294,794
    
    
    $
    64,534
    
    
    $
    (30,584
    )
    
    $
    33,950
 Comparison of Operating Results for the Years Ended December 31, 2008 and 2007
 General.
 Interest and Dividend Income.
 Page 68




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Page 69




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Interest Expense.
     Net Interest Income.
  Page 70




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Provision for Loan Losses.
    Page 71




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Page 72




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Non-Interest Income.
 Non-Interest Expense.
  Page 73




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Income Taxes.
 Comparison of Operating Results for the Years Ended December 31, 2007 and 2006
 General.
 Interest and Dividend Income .
     Page 74




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Interest Expense.
    Page 75




---



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Net Interest Income.
  Provision for Loan Losses.
   Page 76




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Non-Interest Income.
 Non-Interest Expense.
 Income Taxes.
 Liquidity and Capital Resources
  Page 77




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Page 78




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Page 79




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Off-Balance Sheet Arrangements and Contractual Obligations
   Payments Due By PeriodLess Than
    
    
    One Year to
    
    
    Three Years to
    
    
    More ThanContractual Obligation
    
    Total
    
    
    One Year
    
    
    Three Years
    
    
    Five Years
    
    
    Five Years(In thousands)Mortgage loan originations
    
    $
    337,590
    
    
    $
    337,590
    
    
    $
    
    
    
    $
    
    
    
    $
    Mortgage loan purchases
    
    
    219,117
    
    
    
    219,117
    
    
    
    
    
    
    
    
    
    
    
    Mortgage-backed security purchases
    
    
    516,000
    
    
    
    516,000
    
    
    
    
    
    
    
    
    
    
    
    Operating leases
    
    
    149,776
    
    
    
    8,404
    
    
    
    17,311
    
    
    
    16,925
    
    
    
    107,136Total
    
    $
    1,222,483
    
    
    $
    1,081,111
    
    
    $
    17,311
    
    
    $
    16,925
    
    
    $
    107,136
  Recent Accounting Pronouncements
  Page 80




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purchase method
 Page 81




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,
 Page 82




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Impact of Inflation and Changing Prices
  Critical Accounting Policies
  Allowance for Loan Losses
   Page 83




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Stock-Based Compensation
  Page 84




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Pension and Other Post-retirement Benefit Assumptions
    Page 85




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Item 7A. Quantitative and Qualitative Disclosures About Market Risk.
 General
     Page 86




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Page 87




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Management of Interest Rate Risk
  
    
    evaluate the interest rate risk inherent in our balance sheet accounts;
    
    determine the appropriate level of interest rate risk given our business plan, the
current business environment and our capital and liquidity requirements; and
    
    manage interest rate risk in a manner consistent with the approved guidelines and
policies set by our Board of Directors.
    Page 88




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Cash Flow Determination.
  
    
    we assumed an annual prepayment rate for fixed-rate first mortgage loans using the FHLMC
fixed-rate index of moderately seasoned loans and an annual prepayment rate for
variable-rate first mortgage loans using the FHLMC five year balloon index of new loans;
 Page 89




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
    
    we assumed an annual prepayment rate for our mortgage-backed securities using the
prepayment rate associated with the security type;
    
    for savings accounts that had no stated maturity, we used decay rates (the assumed rate
at which the balance of existing accounts would decline) of: 7.5% in less than six months,
7.5% in six months to one year, 10.0% in one year to two years, 10.0% in two years to three
years, 25.0% in three years to five years, and 40.0% in more than five years;
    
    for our High Value Checking product, which is included in interest-bearing transaction
accounts, we used decay rates of: 10.0% in less than six months, 10.0% in six months to one
year, 15% in one to two years, 15% in two to three years, 25% in three to five years, and
25% in more than five years;
    
    for other interest-bearing transaction accounts that had no stated maturity, we used
decay rates of : 7.5% in less than six months, 7.5% in six months to one year, 10.0% in
one to two years, 10.0% in two to three years, 25.0% in three years to five years, and
40.0% in more than five years;
    
    for money market accounts that had no stated maturity, we used decay rates of: 10.0% in
less than six months, 10.0% in six months to one year, 20.0% in one to two years, 20.0% in
two to three years, 35.0% in three years to five years, and 5.0% in more than five years;
    
    callable investment securities are shown at the earlier of their probable call date,
maturity date or the next rate adjustment date (step-up securities); the model assumed
calls of investment securities of $975.0 million over the next year in the current (zero
basis point) change scenario; we currently hold $3.25 billion of step-up bonds, of which
$950.0 million were reported at their next call date; and
    
    borrowed funds are shown at the earlier of their probable call date or maturity date
given the rate of the instrument in relation to the current market rate environment and the
call option frequency; the model assumed there were no calls of borrowed funds over the
next year in the current (zero basis point) change scenario.
 Simulation Model.
 Net Interest Income.
 Page 90




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Change in
    
    Percent Change inInterest Rates
    
    Net Interest Income(Basis points)200
    
    
    (2.83
    )%100
    
    
    0.98
  Present Value of Equity.
  Present Value of EquityAs Percent of PresentValue of AssetsChange in
    
    Present
    
    Basis PointInterest Rates
    
    Value Ratio
    
    Change(Basis points)200
    
    
    3.84
    %
    
    
    8100
    
    
    4.74
    
    
    
    980
    
    
    3.76
    
    
    
 Page 91




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Gap Analysis.
   Page 92




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At December 31, 2008More than
    
    
    More thanMore than
    
    
    More than
    
    
    two years
    
    
    three yearsSix months
    
    
    six months
    
    
    one year to
    
    
    to three
    
    
    to five
    
    
    More thanor less
    
    
    to one year
    
    
    two years
    
    
    years
    
    
    years
    
    
    five years
    
    
    Total(Dollars in thousands)Interest-earning assets:First mortgage loans
    
    $
    1,842,671
    
    
    $
    1,935,167
    
    
    $
    3,784,803
    
    
    $
    2,974,254
    
    
    $
    4,035,226
    
    
    $
    14,251,899
    
    
    $
    28,824,020Consumer and other loans
    
    
    102,599
    
    
    
    2,284
    
    
    
    19,792
    
    
    
    3,496
    
    
    
    13,516
    
    
    
    242,485
    
    
    
    384,172Federal funds sold
    
    
    76,896
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    76,896Mortgage-backed securities
    
    
    2,043,739
    
    
    
    1,840,592
    
    
    
    3,734,031
    
    
    
    4,592,093
    
    
    
    4,857,988
    
    
    
    2,419,368
    
    
    
    19,487,811FHLB stock
    
    
    865,570
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    865,570Investment securities
    
    
    982,384
    
    
    
    500,000
    
    
    
    900,105
    
    
    
    
    
    
    
    973,176
    
    
    
    108,054
    
    
    
    3,463,719Total interest-earning assets
    
    
    5,913,859
    
    
    
    4,278,043
    
    
    
    8,438,731
    
    
    
    7,569,843
    
    
    
    9,879,906
    
    
    
    17,021,806
    
    
    
    53,102,188Interest-bearing liabilities:Savings accounts
    
    
    53,431
    
    
    
    53,432
    
    
    
    71,242
    
    
    
    71,242
    
    
    
    178,105
    
    
    
    284,968
    
    
    
    712,420Interest-bearing demand accounts
    
    
    153,617
    
    
    
    153,617
    
    
    
    228,545
    
    
    
    228,545
    
    
    
    393,443
    
    
    
    416,004
    
    
    
    1,573,771Money market accounts
    
    
    271,643
    
    
    
    271,643
    
    
    
    543,286
    
    
    
    543,286
    
    
    
    950,750
    
    
    
    135,821
    
    
    
    2,716,429Time deposits
    
    
    11,484,211
    
    
    
    992,747
    
    
    
    400,646
    
    
    
    31,677
    
    
    
    37,945
    
    
    
    
    
    
    
    12,947,226Borrowed funds
    
    
    550,000
    
    
    
    50,000
    
    
    
    300,000
    
    
    
    250,000
    
    
    
    350,000
    
    
    
    28,725,000
    
    
    
    30,225,000Total interest-bearing liabilities
    
    
    12,512,902
    
    
    
    1,521,439
    
    
    
    1,543,719
    
    
    
    1,124,750
    
    
    
    1,910,243
    
    
    
    29,561,793
    
    
    
    48,174,846Interest rate sensitivity gap
    
    $
    (6,599,043
    )
    
    $
    2,756,604
    
    
    $
    6,895,012
    
    
    $
    6,445,093
    
    
    $
    7,969,663
    
    
    $
    (12,539,987
    )
    
    $
    4,927,342Cumulative interest rate sensitivity gap
    
    $
    (6,599,043
    )
    
    $
    (3,842,439
    )
    
    $
    3,052,573
    
    
    $
    9,497,666
    
    
    $
    17,467,329
    
    
    $
    4,927,342Cumulative interest rate sensitivity gap
as a percent of total assets
    
    
    (12.18)
    %
    
    
    (7.09
    )%
    
    
    5.64
    %
    
    
    17.54
    %
    
    
    32.25
    %
    
    
    9.10
    %Cumulative interest-earning assets
as a percent of interest-bearing
liabilities
    
    
    47.26
    %
    
    
    72.62
    %
    
    
    119.60
    %
    
    
    156.86
    %
    
    
    193.84
    %
    
    
    110.23
    %
   Page 93




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Item 8. Financial Statements and Supplementary Data.
 Report of Independent Registered Public Accounting Firm
 
    Internal Control  Integrated Framework
 
 Page 94




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Report of Independent Registered Public Accounting Firm
 
 Internal
Control  Integrated Framework .
    Internal Control  Integrated Framework
  Page 95




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.
 
 Page 96




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Hudson City Bancorp, Inc. and Subsidiary
Consolidated Statements of Financial Condition
 December 31,
    
    
    December 31,2008
    
    
    2007(In thousands, except share and per share amounts)Assets:Cash and due from banks
    
    $
    184,915
    
    
    $
    111,245Federal funds sold
    
    
    76,896
    
    
    
    106,299Total cash and cash equivalents
    
    
    261,811
    
    
    
    217,544Securities available for sale:Mortgage-backed securities
    
    
    9,915,554
    
    
    
    5,005,409Investment securities
    
    
    3,413,633
    
    
    
    2,765,491Securities held to maturity:Mortgage-backed securities (fair value of $9,695,445 and $9,566,312
at December 31, 2008 and 2007, respectively)
    
    
    9,572,257
    
    
    
    9,565,526Investment securities (fair value of $50,512 and $1,410,246
at December 31, 2008 and 2007, respectively)
    
    
    50,086
    
    
    
    1,408,501Total securities
    
    
    22,951,530
    
    
    
    18,744,927Loans
    
    
    29,418,888
    
    
    
    24,192,281Deferred loan costs
    
    
    71,670
    
    
    
    40,598Allowance for loan losses
    
    
    (49,797
    )
    
    
    (34,741
    )Net loans
    
    
    29,440,761
    
    
    
    24,198,138Federal Home Loan Bank of New York stock
    
    
    865,570
    
    
    
    695,351Foreclosed real estate, net
    
    
    15,532
    
    
    
    4,055Accrued interest receivable
    
    
    299,045
    
    
    
    245,113Banking premises and equipment, net
    
    
    73,502
    
    
    
    75,094Goodwill
    
    
    152,109
    
    
    
    152,109Other assets
    
    
    85,468
    
    
    
    91,640Total Assets
    
    $
    54,145,328
    
    
    $
    44,423,971Liabilities and Stockholders Equity:Deposits:Interest-bearing
    
    $
    17,949,846
    
    
    $
    14,635,412Noninterest-bearing
    
    
    514,196
    
    
    
    517,970Total deposits
    
    
    18,464,042
    
    
    
    15,153,382Repurchase agreements
    
    
    15,100,000
    
    
    
    12,016,000Federal Home Loan Bank of New York advances
    
    
    15,125,000
    
    
    
    12,125,000Total borrowed funds
    
    
    30,225,000
    
    
    
    24,141,000Due to brokers for securities purchases
    
    
    239,100
    
    
    
    281,853Accrued expenses and other liabilities
    
    
    278,390
    
    
    
    236,429Total liabilities
    
    
    49,206,532
    
    
    
    39,812,664Commitments and Contingencies (Notes 7, 9 and 14)Common stock, $0.01 par value, 3,200,000,000 shares authorized;
741,466,555 shares issued; 523,770,617 and 518,569,602 shares
outstanding at December 31, 2008 and 2007, respectively
    
    
    7,415
    
    
    
    7,415Additional paid-in capital
    
    
    4,641,571
    
    
    
    4,578,578Retained earnings
    
    
    2,196,235
    
    
    
    2,002,049Treasury stock, at cost; 217,695,938 and 222,896,953 shares at
December 31, 2008 and 2007, respectively
    
    
    (1,737,838
    )
    
    
    (1,771,106
    )Unallocated common stock held by the employee stock ownership plan
    
    
    (216,244
    )
    
    
    (222,251
    )Accumulated other comprehensive income, net of tax
    
    
    47,657
    
    
    
    16,622Total stockholders equity
    
    
    4,938,796
    
    
    
    4,611,307Total Liabilities and Stockholders Equity
    
    $
    54,145,328
    
    
    $
    44,423,971
  Page 97




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##### Table of Contents



Hudson City Bancorp, Inc. and Subsidiary
Consolidated Statements of Income
 Year Ended December 31,2008
    
    
    2007
    
    
    2006(In thousands, except per share data)Interest and Dividend Income:First mortgage loans
    
    $
    1,523,521
    
    
    $
    1,205,461
    
    
    $
    932,550Consumer and other loans
    
    
    26,184
    
    
    
    28,247
    
    
    
    19,698Mortgage-backed securities held to maturity
    
    
    497,912
    
    
    
    457,720
    
    
    
    262,417Mortgage-backed securities available for sale
    
    
    377,096
    
    
    
    130,185
    
    
    
    119,578Investment securities held to maturity
    
    
    13,390
    
    
    
    74,198
    
    
    
    74,592Investment securities available for sale
    
    
    162,818
    
    
    
    179,909
    
    
    
    181,259Dividends on Federal Home Loan Bank of New York stock
    
    
    48,009
    
    
    
    39,492
    
    
    
    16,507Federal funds sold
    
    
    4,295
    
    
    
    12,293
    
    
    
    8,242Total interest and dividend income
    
    
    2,653,225
    
    
    
    2,127,505
    
    
    
    1,614,843Interest Expense:Deposits
    
    
    581,357
    
    
    
    606,936
    
    
    
    436,096Borrowed funds
    
    
    1,129,891
    
    
    
    873,386
    
    
    
    565,514Total interest expense
    
    
    1,711,248
    
    
    
    1,480,322
    
    
    
    1,001,610Net interest income
    
    
    941,977
    
    
    
    647,183
    
    
    
    613,233Provision for Loan Losses
    
    
    19,500
    
    
    
    4,800
    
    
    
    Net interest income after
provision for loan losses
    
    
    922,477
    
    
    
    642,383
    
    
    
    613,233Non-Interest Income:Service charges and other income
    
    
    8,485
    
    
    
    7,267
    
    
    
    6,287Gains on securities transactions
    
    
    
    
    
    
    6
    
    
    
    4Total non-interest income
    
    
    8,485
    
    
    
    7,273
    
    
    
    6,291Non-Interest Expense:Compensation and employee benefits
    
    
    127,198
    
    
    
    106,630
    
    
    
    103,443Net occupancy expense
    
    
    30,457
    
    
    
    29,589
    
    
    
    25,015Federal deposit insurance assessment
    
    
    4,320
    
    
    
    1,701
    
    
    
    1,695Computer and related services
    
    
    2,851
    
    
    
    2,605
    
    
    
    2,812Other expense
    
    
    33,250
    
    
    
    27,388
    
    
    
    25,990Total non-interest expense
    
    
    198,076
    
    
    
    167,913
    
    
    
    158,955Income before income tax expense
    
    
    732,886
    
    
    
    481,743
    
    
    
    460,569Income Tax Expense
    
    
    287,328
    
    
    
    185,885
    
    
    
    171,990Net income
    
    $
    445,558
    
    
    $
    295,858
    
    
    $
    288,579Basic Earnings Per Share
    
    $
    0.92
    
    
    $
    0.59
    
    
    $
    0.54Diluted Earnings Per Share
    
    $
    0.90
    
    
    $
    0.58
    
    
    $
    0.53
  Page 98




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##### Table of Contents



Hudson City Bancorp, Inc. and Subsidiary
Consolidated Statements of Changes in Stockholders Equity
 Year Ended December 31,2008
    
    
    2007
    
    
    2006(In thousands , except share amounts)Common Stock
    
    $
    7,415
    
    
    $
    7,415
    
    
    $
    7,415Additional paid-in capital:Balance at beginning of year
    
    
    4,578,578
    
    
    
    4,553,614
    
    
    
    4,533,329Unvested RRP awards reclassified as additonal
paid-in-capital
    
    
    
    
    
    
    
    
    
    
    (2,815
    )Stock option plan expense
    
    
    15,043
    
    
    
    12,242
    
    
    
    5,526Tax benefit from stock plans
    
    
    36,119
    
    
    
    3,761
    
    
    
    8,633Allocation of ESOP stock
    
    
    10,471
    
    
    
    7,313
    
    
    
    6,700Vesting of RRP stock
    
    
    1,360
    
    
    
    1,648
    
    
    
    2,241Balance at end of year
    
    
    4,641,571
    
    
    
    4,578,578
    
    
    
    4,553,614Retained Earnings:Balance at beginning of year
    
    
    2,002,049
    
    
    
    1,877,840
    
    
    
    1,759,492Net income
    
    
    445,558
    
    
    
    295,858
    
    
    
    288,579Dividends paid on common stock ($0.45, $0.33, and
$0.30 per share, respectively)
    
    
    (217,995
    )
    
    
    (165,376
    )
    
    
    (161,374
    )Exercise of stock options
    
    
    (33,377
    )
    
    
    (6,273
    )
    
    
    (8,857
    )Balance at end of year
    
    
    2,196,235
    
    
    
    2,002,049
    
    
    
    1,877,840Treasury Stock:Balance at beginning of year
    
    
    (1,771,106
    )
    
    
    (1,230,793
    )
    
    
    (798,232
    )Purchase of common stock
    
    
    (17,045
    )
    
    
    (550,215
    )
    
    
    (448,237
    )Exercise of stock options
    
    
    50,313
    
    
    
    9,902
    
    
    
    15,676Balance at end of year
    
    
    (1,737,838
    )
    
    
    (1,771,106
    )
    
    
    (1,230,793
    )Unallocated common stock held by the ESOP:Balance at beginning of year
    
    
    (222,251
    )
    
    
    (228,257
    )
    
    
    (234,264
    )Allocation of ESOP stock
    
    
    6,007
    
    
    
    6,006
    
    
    
    6,007Balance at end of year
    
    
    (216,244
    )
    
    
    (222,251
    )
    
    
    (228,257
    )Unallocated common stock held by the Recognition and Retention Plan:Balance at beginning of year
    
    
    
    
    
    
    
    
    
    
    (2,815
    )Unvested RRP awards reclassified as additonal
paid-in-capital
    
    
    
    
    
    
    
    
    
    
    2,815Balance at end of year
    
    
    
    
    
    
    
    
    
    
    Accumulated other comprehensive income (loss):Balance at beginning of year
    
    
    16,622
    
    
    
    (49,563
    )
    
    
    (63,449
    )Net unrealized gains on securities available for sale
arising during
the year, net of tax expense of $37,961 for 2008, $47,073 for
2007 and $9,765 for 2006
    
    
    54,967
    
    
    
    68,173
    
    
    
    14,143Reclassification adjustment for gains included in net
income, net
of tax of $0 for 2008, ($2) for 2007 and ($2) for 2006
    
    
    
    
    
    
    (4
    )
    
    
    (2
    )Pension and other postretirement benefits adjustment,
net of tax
benefit of $16,528 for 2008, $1,366 for 2007 and $175
for 2006
    
    
    (23,932
    )
    
    
    (1,984
    )
    
    
    (255
    )Other comprehensive income, net of tax
    
    
    31,035
    
    
    
    66,185
    
    
    
    13,886Balance at end of year
    
    
    47,657
    
    
    
    16,622
    
    
    
    (49,563
    )Total Stockholders Equity
    
    $
    4,938,796
    
    
    $
    4,611,307
    
    
    $
    4,930,256Summary of comprehensive incomeNet income
    
    $
    445,558
    
    
    $
    295,858
    
    
    $
    288,579Other comprehensive income, net of tax
    
    
    31,035
    
    
    
    66,185
    
    
    
    13,886Total comprehensive income
    
    $
    476,593
    
    
    $
    362,043
    
    
    $
    302,465
  Page 99




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##### Table of Contents



Hudson City Bancorp, Inc. and Subsidiary
Consolidated Statements of Cash Flows
 Year Ended December 31,2008
    
    
    2007
    
    
    2006(In thousands)Cash Flows from Operating Activities:Net income
    
    $
    445,558
    
    
    $
    295,858
    
    
    $
    288,579Adjustments to reconcile net income to net cash provided
by operating activities:Depreciation, accretion and amortization expense
    
    
    26,329
    
    
    
    22,484
    
    
    
    21,952Provision for loan losses
    
    
    19,500
    
    
    
    4,800
    
    
    
    Gains on securities transactions, net
    
    
    
    
    
    
    (6
    )
    
    
    (4
    )Share-based compensation, including committed ESOP shares
    
    
    32,881
    
    
    
    27,209
    
    
    
    20,474Deferred tax benefit
    
    
    (12,868
    )
    
    
    (9,430
    )
    
    
    (3,659
    )Increase in accrued interest receivable
    
    
    (53,932
    )
    
    
    (50,884
    )
    
    
    (48,580
    )(Increase) decrease in other assets
    
    
    (21,053
    )
    
    
    11,871
    
    
    
    (4,166
    )Increase in accrued expenses and other liabilities
    
    
    18,029
    
    
    
    45,901
    
    
    
    46,571Net Cash Provided by Operating Activities
    
    
    454,444
    
    
    
    347,803
    
    
    
    321,167Cash Flows from Investing Activities:Originations of loans
    
    
    (5,040,221
    )
    
    
    (3,352,511
    )
    
    
    (2,307,487
    )Purchases of loans
    
    
    (3,061,859
    )
    
    
    (3,971,273
    )
    
    
    (2,712,148
    )Payments on loans
    
    
    2,820,381
    
    
    
    2,189,018
    
    
    
    1,754,157Principal collection of mortgage-backed securities held to maturity
    
    
    1,348,304
    
    
    
    1,215,867
    
    
    
    773,343Purchases of mortgage-backed securities held to maturity
    
    
    (1,360,861
    )
    
    
    (3,861,633
    )
    
    
    (3,313,668
    )Principal collection of mortgage-backed securities available for sale
    
    
    956,710
    
    
    
    696,560
    
    
    
    741,200Proceeds from sales of mortgage-backed securities available for sale
    
    
    
    
    
    
    
    
    
    
    186,169Purchases of mortgage-backed securities available for sale
    
    
    (5,820,531
    )
    
    
    (2,966,473
    )
    
    
    (617,172
    )Proceeds from maturities and calls of investment securities held to maturity
    
    
    1,358,485
    
    
    
    125,480
    
    
    
    256Proceeds from maturities and calls of investment securities available for sale
    
    
    1,449,906
    
    
    
    3,825,060
    
    
    
    850,013Proceeds from sales of investment securities available for sale
    
    
    
    
    
    
    
    
    
    
    112,157Purchases of investment securities available for sale
    
    
    (2,100,000
    )
    
    
    (2,148,705
    )
    
    
    (1,250,010
    )Purchases of Federal Home Loan Bank of New York stock
    
    
    (193,277
    )
    
    
    (259,660
    )
    
    
    (233,236
    )Redemption of Federal Home Loan Bank of New York stock
    
    
    23,058
    
    
    
    9,315
    
    
    
    18,000Cash paid in purchase acquistion, net of cash acquired
    
    
    
    
    
    
    
    
    
    
    (197,653
    )Purchases of premises and equipment, net
    
    
    (8,565
    )
    
    
    (11,694
    )
    
    
    (22,557
    )Net proceeds from sale of foreclosed real estate
    
    
    5,618
    
    
    
    550
    
    
    
    1,449Net Cash Used in Investing Activities
    
    
    (9,622,852
    )
    
    
    (8,510,099
    )
    
    
    (6,217,187
    )Cash Flows from Financing Activities:Net increase in deposits
    
    
    3,310,660
    
    
    
    1,737,795
    
    
    
    970,166Proceeds from borrowed funds
    
    
    6,650,000
    
    
    
    10,725,000
    
    
    
    9,125,000Principal payments on borrowed funds
    
    
    (566,000
    )
    
    
    (3,557,000
    )
    
    
    (3,525,000
    )Dividends paid
    
    
    (217,995
    )
    
    
    (165,376
    )
    
    
    (161,374
    )Purchases of treasury stock
    
    
    (17,045
    )
    
    
    (550,215
    )
    
    
    (448,237
    )Exercise of stock options
    
    
    16,936
    
    
    
    3,629
    
    
    
    6,819Tax benefit from stock plans
    
    
    36,119
    
    
    
    3,761
    
    
    
    8,633Net Cash Provided by Financing Activities
    
    
    9,212,675
    
    
    
    8,197,594
    
    
    
    5,976,007Net Increase in Cash and Cash Equivalents
    
    
    44,267
    
    
    
    35,298
    
    
    
    79,987Cash and Cash Equivalents at Beginning of Year
    
    
    217,544
    
    
    
    182,246
    
    
    
    102,259Cash and Cash Equivalents at End of Year
    
    $
    261,811
    
    
    $
    217,544
    
    
    $
    182,246Supplemental Disclosures:Interest paid
    
    $
    1,689,934
    
    
    $
    1,413,140
    
    
    $
    969,606Loans transferred to foreclosed real estate
    
    $
    18,892
    
    
    $
    1,752
    
    
    $
    3,642Income taxes paid
    
    $
    282,009
    
    
    $
    161,983
    
    
    $
    172,382
  Page 100




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##### Table of Contents



Notes to Consolidated Financial Statements
 1. Organization
  Acquisition of Sound Federal
  2. Summary of Significant Accounting Policies
 Basis of Presentation
  Page 101




---



##### Table of Contents



Cash and Cash Equivalents
  Mortgage-Backed Securities
   Investment Securities
  Page 102




---



##### Table of Contents



Loans
     Allowance for Loan Losses
  Page 103




---



##### Table of Contents



Federal Home Loan Bank of New York Stock
  Foreclosed Real Estate
  Page 104




---



##### Table of Contents



Banking Premises and Equipment
  Goodwill and Other Intangible Assets
  Income Taxes
   Employee Benefit Plans
  Page 105




---



##### Table of Contents



Stock-Based Compensation
  Bank-Owned Life Insurance
  Borrowed Funds
  Page 106




---



##### Table of Contents



Comprehensive Income
  Segment Information
  Earnings Per Share
   3. Stock Repurchase Programs
  Page 107




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##### Table of Contents



4. Mortgage-Backed Securities
  Gross
    
    
    Gross
    
    
    EstimatedAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    Fair MarketCost
    
    
    Gains
    
    
    Losses
    
    
    Value(In thousands)2008Held to Maturity:GNMA pass-through certificates
    
    $
    128,906
    
    
    $
    108
    
    
    $
    (1,705
    )
    
    $
    127,309FNMA pass-through certificates
    
    
    3,203,799
    
    
    
    44,905
    
    
    
    (857
    )
    
    
    3,247,847FHLMC pass-through certificates
    
    
    5,859,297
    
    
    
    85,885
    
    
    
    (2,027
    )
    
    
    5,943,155FHLMC and FNMA  REMICs
    
    
    380,255
    
    
    
    363
    
    
    
    (3,484
    )
    
    
    377,134Total held to maturity
    
    $
    9,572,257
    
    
    $
    131,261
    
    
    $
    (8,073
    )
    
    $
    9,695,445Available for Sale:GNMA pass-through certificates
    
    $
    938,393
    
    
    $
    2,425
    
    
    $
    (24,823
    )
    
    $
    915,995FNMA pass-through certificates
    
    
    3,253,463
    
    
    
    47,425
    
    
    
    
    
    
    
    3,300,888FHLMC pass-through certificates
    
    
    5,607,066
    
    
    
    91,657
    
    
    
    (52
    )
    
    
    5,698,671Total available for sale
    
    $
    9,798,922
    
    
    $
    141,507
    
    
    $
    (24,875
    )
    
    $
    9,915,5542007Held to Maturity:GNMA pass-through certificates
    
    $
    157,716
    
    
    $
    1,379
    
    
    $
    (96
    )
    
    $
    158,999FNMA pass-through certificates
    
    
    3,214,509
    
    
    
    15,216
    
    
    
    (23,803
    )
    
    
    3,205,922FHLMC pass-through certificates
    
    
    5,808,288
    
    
    
    52,536
    
    
    
    (11,080
    )
    
    
    5,849,744FHLMC and FNMA  REMICs
    
    
    385,013
    
    
    
    2
    
    
    
    (33,368
    )
    
    
    351,647Total held to maturity
    
    $
    9,565,526
    
    
    $
    69,133
    
    
    $
    (68,347
    )
    
    $
    9,566,312Available for Sale:GNMA pass-through certificates
    
    $
    1,254,706
    
    
    $
    5,031
    
    
    $
    (1,844
    )
    
    $
    1,257,893FNMA pass-through certificates
    
    
    1,104,434
    
    
    
    2,200
    
    
    
    (8,562
    )
    
    
    1,098,072FHLMC pass-through certificates
    
    
    2,624,612
    
    
    
    25,887
    
    
    
    (1,055
    )
    
    
    2,649,444Total available for sale
    
    $
    4,983,752
    
    
    $
    33,118
    
    
    $
    (11,461
    )
    
    $
    5,005,409
 Page 108




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##### Table of Contents



Less Than 12 Months
    
    
    12 Months or Longer
    
    
    TotalUnrealized
    
    
    
    
    
    
    Unrealized
    
    
    
    
    
    
    UnrealizedFair Value
    
    
    Losses
    
    
    Fair Value
    
    
    Losses
    
    
    Fair Value
    
    
    Losses(In thousands)2008Held to Maturity:GNMA pass-through
certificates
    
    $
    99,059
    
    
    $
    (1,333
    )
    
    $
    12,753
    
    
    $
    (372
    )
    
    $
    111,812
    
    
    $
    (1,705
    )FNMA pass-through
certificates
    
    
    53,796
    
    
    
    (230
    )
    
    
    154,150
    
    
    
    (627
    )
    
    
    207,946
    
    
    
    (857
    )FHLMC pass-through
certificates
    
    
    88,814
    
    
    
    (310
    )
    
    
    186,866
    
    
    
    (1,717
    )
    
    
    275,680
    
    
    
    (2,027
    )FHLMC and FNMA  REMICs
    
    
    
    
    
    
    
    
    
    
    274,434
    
    
    
    (3,484
    )
    
    
    274,434
    
    
    
    (3,484
    )Total held to maturity
    
    
    241,669
    
    
    
    (1,873
    )
    
    
    628,203
    
    
    
    (6,200
    )
    
    
    869,872
    
    
    
    (8,073
    )Available for Sale:GNMA pass-through
certificates
    
    
    312,112
    
    
    
    (6,714
    )
    
    
    467,660
    
    
    
    (18,109
    )
    
    
    779,772
    
    
    
    (24,823
    )FNMA pass-through
certificates
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    FHLMC pass-through
certificates
    
    
    95,928
    
    
    
    (52
    )
    
    
    
    
    
    
    
    
    
    
    95,928
    
    
    
    (52
    )Total available for sale
    
    
    408,040
    
    
    
    (6,766
    )
    
    
    467,660
    
    
    
    (18,109
    )
    
    
    875,700
    
    
    
    (24,875
    )Total
    
    $
    649,709
    
    
    $
    (8,639
    )
    
    $
    1,095,863
    
    
    $
    (24,309
    )
    
    $
    1,745,572
    
    
    $
    (32,948
    )2007Held to Maturity:GNMA pass-through
certificates
    
    $
    2,236
    
    
    $
    (3
    )
    
    $
    18,943
    
    
    $
    (93
    )
    
    $
    21,179
    
    
    $
    (96
    )FNMA pass-through
certificates
    
    
    72,976
    
    
    
    (302
    )
    
    
    1,490,241
    
    
    
    (23,501
    )
    
    
    1,563,217
    
    
    
    (23,803
    )FHLMC pass-through
certificates
    
    
    68,385
    
    
    
    (279
    )
    
    
    713,637
    
    
    
    (10,801
    )
    
    
    782,022
    
    
    
    (11,080
    )FHLMC and FNMA  REMICs
    
    
    
    
    
    
    
    
    
    
    351,387
    
    
    
    (33,368
    )
    
    
    351,387
    
    
    
    (33,368
    )Total held to maturity
    
    
    143,597
    
    
    
    (584
    )
    
    
    2,574,208
    
    
    
    (67,763
    )
    
    
    2,717,805
    
    
    
    (68,347
    )Available for Sale:GNMA pass-through
certificates
    
    
    
    
    
    
    
    
    
    
    435,687
    
    
    
    (1,844
    )
    
    
    435,687
    
    
    
    (1,844
    )FNMA pass-through
certificates
    
    
    137,603
    
    
    
    (151
    )
    
    
    470,121
    
    
    
    (8,411
    )
    
    
    607,724
    
    
    
    (8,562
    )FHLMC pass-through
certificates
    
    
    
    
    
    
    
    
    
    
    116,141
    
    
    
    (1,055
    )
    
    
    116,141
    
    
    
    (1,055
    )Total available for sale
    
    
    137,603
    
    
    
    (151
    )
    
    
    1,021,949
    
    
    
    (11,310
    )
    
    
    1,159,552
    
    
    
    (11,461
    )Total
    
    $
    281,200
    
    
    $
    (735
    )
    
    $
    3,596,157
    
    
    $
    (79,073
    )
    
    $
    3,877,357
    
    
    $
    (79,808
    )
  Page 109




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##### Table of Contents



EstimatedAmortized
    
    
    Fair MarketCost
    
    
    Value(In thousands)Held to Maturity:Due in one year or less
    
    $
    131
    
    
    $
    133Due after one year through five years
    
    
    659
    
    
    
    686Due after five years through ten years
    
    
    15,623
    
    
    
    16,128Due after ten years
    
    
    9,555,844
    
    
    
    9,678,498Total held to maturity
    
    $
    9,572,257
    
    
    $
    9,695,445Available for Sale:Due after ten years
    
    $
    9,798,922
    
    
    $
    9,915,554Total available for sale
    
    $
    9,798,922
    
    
    $
    9,915,554
  5. Investment Securities
  Gross
    
    
    Gross
    
    
    EstimatedAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    Fair MarketCost
    
    
    Gains
    
    
    Losses
    
    
    Value(In thousands)2008Held to Maturity:United States
government-sponsored enterprises debt
    
    $
    49,981
    
    
    $
    425
    
    
    $
    
    
    
    $
    50,406Municipal bonds
    
    
    105
    
    
    
    1
    
    
    
    
    
    
    
    106Total held to maturity
    
    $
    50,086
    
    
    $
    426
    
    
    $
    
    
    
    $
    50,512Available for Sale:United
States government-sponsored enterprises debt
    
    $
    3,397,204
    
    
    $
    14,137
    
    
    $
    (5,093
    )
    
    $
    3,406,248Equity securities
    
    
    6,935
    
    
    
    450
    
    
    
    
    
    
    
    7,385Total available for sale
    
    $
    3,404,139
    
    
    $
    14,587
    
    
    $
    (5,093
    )
    
    $
    3,413,6332007Held to Maturity:United
States government-sponsored enterprises debt
    
    $
    1,408,071
    
    
    $
    1,743
    
    
    $
    
    
    
    $
    1,409,814Municipal bonds
    
    
    430
    
    
    
    2
    
    
    
    
    
    
    
    432Total held to maturity
    
    $
    1,408,501
    
    
    $
    1,745
    
    
    $
    
    
    
    $
    1,410,246Available for Sale:United
States government-sponsored enterprises debt
    
    $
    2,747,012
    
    
    $
    14,365
    
    
    $
    (3,184
    )
    
    $
    2,758,193Corporate bonds
    
    
    4
    
    
    
    
    
    
    
    
    
    
    
    4Equity securities
    
    
    6,935
    
    
    
    359
    
    
    
    
    
    
    
    7,294Total available for sale
    
    $
    2,753,951
    
    
    $
    14,724
    
    
    $
    (3,184
    )
    
    $
    2,765,491
 Page 110




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##### Table of Contents



Less Than 12 Months
    
    
    12 Months or Longer
    
    
    TotalUnrealized
    
    
    
    
    
    
    Unrealized
    
    
    
    
    
    
    UnrealizedFair Value
    
    
    Losses
    
    
    Fair Value
    
    
    Losses
    
    
    Fair Value
    
    
    Losses(In thousands)2008Available for Sale:United States government
-sponsored enterprises debt
    
    $
    594,907
    
    
    $
    (5,093
    )
    
    $
    
    
    
    $
    
    
    
    $
    594,907
    
    
    $
    (5,093
    )Total
    
    $
    594,907
    
    
    $
    (5,093
    )
    
    $
    
    
    
    $
    
    
    
    $
    594,907
    
    
    $
    (5,093
    )2007Available for Sale:United States government
-sponsored enterprises debt
    
    $
    
    
    
    $
    
    
    
    $
    821,891
    
    
    $
    (3,184
    )
    
    $
    821,891
    
    
    $
    (3,184
    )Total
    
    $
    
    
    
    $
    
    
    
    $
    821,891
    
    
    $
    (3,184
    )
    
    $
    821,891
    
    
    $
    (3,184
    )
   EstimatedAmortized
    
    
    Fair MarketCost
    
    
    Value(In thousands)Held to Maturity:Due after one year through five years
    
    $
    105
    
    
    $
    106Due after ten years
    
    
    49,981
    
    
    
    50,406Total held to maturity
    
    $
    50,086
    
    
    $
    50,512Available for Sale:Due after one year through five years
    
    $
    147,204
    
    
    $
    148,176Due after five years through ten years
    
    
    2,500,000
    
    
    
    2,512,954Due after ten years
    
    
    750,000
    
    
    
    745,118Total available for sale
    
    $
    3,397,204
    
    
    $
    3,406,248
 Page 111




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##### Table of Contents



6. Loans and Allowance for Loan Losses
  2008
    
    
    2007(In thousands)First mortgage loans:One- to four-family
    
    $
    28,935,645
    
    
    $
    23,671,712FHA/VA
    
    
    20,197
    
    
    
    22,940Multi-family and commercial
    
    
    53,421
    
    
    
    58,874Construction
    
    
    24,830
    
    
    
    34,064Total first mortgage loans
    
    
    29,034,093
    
    
    
    23,787,590Consumer and other loans:Fixedrate second mortgages
    
    
    262,538
    
    
    
    284,406Home equity credit lines
    
    
    101,751
    
    
    
    104,567Other
    
    
    20,506
    
    
    
    15,718Total consumer and other loans
    
    
    384,795
    
    
    
    404,691Total loans
    
    $
    29,418,888
    
    
    $
    24,192,281
    Page 112




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##### Table of Contents



At December 31, 2008Total loans
    
    
    Non-performing loansNew Jersey
    
    
    44.8
    %
    
    
    40.4
    %New York
    
    
    15.6
    %
    
    
    22.6
    %Connecticut
    
    
    9.3
    %
    
    
    2.3
    %Total New York
metropolitan area
    
    
    69.7
    %
    
    
    65.3
    %Virginia
    
    
    5.5
    %
    
    
    4.2
    %Illinois
    
    
    4.3
    %
    
    
    3.5
    %Maryland
    
    
    4.2
    %
    
    
    5.4
    %Massachusetts
    
    
    3.0
    %
    
    
    2.7
    %Minnesotta
    
    
    1.8
    %
    
    
    3.8
    %Michigan
    
    
    1.7
    %
    
    
    3.7
    %Pennsylvania
    
    
    1.5
    %
    
    
    1.5
    %All others
    
    
    8.3
    %
    
    
    9.9
    %30.3
    %
    
    
    34.7
    %100.0
    %
    
    
    100.0
    %
   Page 113




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##### Table of Contents



2008
    
    
    2007(In thousands)Non-accrual loans:One-to four-family
    
    $
    200,642
    
    
    $
    69,904Multi-family and
commercial mortgages
    
    
    1,854
    
    
    
    2,028Construction loans
    
    
    7,610
    
    
    
    647Consumer loans
    
    
    626
    
    
    
    956Total non-accrual loans
    
    
    210,732
    
    
    
    73,535Accruing loans delinquent 90 days or more
    
    
    6,842
    
    
    
    5,867Total non-performing loans
    
    $
    217,574
    
    
    $
    79,402
    Page 114




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##### Table of Contents



2008
    
    
    2007
    
    
    2006(In thousands)Balance at beginning of year
    
    $
    34,741
    
    
    $
    30,625
    
    
    $
    27,393Charge-offs
    
    
    (4,522
    )
    
    
    (763
    )
    
    
    (79
    )Recoveries
    
    
    78
    
    
    
    79
    
    
    
    3Net charge-offs
    
    
    (4,444
    )
    
    
    (684
    )
    
    
    (76
    )Provision for loan losses
    
    
    19,500
    
    
    
    4,800
    
    
    
    Allowance transferred in Acquisition
    
    
    
    
    
    
    
    
    
    
    3,308Balance at end of year
    
    $
    49,797
    
    
    $
    34,741
    
    
    $
    30,625
 7. Banking Premises and Equipment, net
  2008
    
    
    2007(In thousands)Land
    
    $
    5,806
    
    
    $
    5,806Buildings
    
    
    54,757
    
    
    
    53,924Leasehold improvements
    
    
    41,279
    
    
    
    38,094Furniture, fixtures and equipment
    
    
    75,756
    
    
    
    71,649Total acquisition cost
    
    
    177,598
    
    
    
    169,473Accumulated depreciation and amortization
    
    
    (104,096
    )
    
    
    (94,379
    )Total banking premises and equipment, net
    
    $
    73,502
    
    
    $
    75,094
   Year
    
    Amount(In thousands)2009
    
    $
    8,4042010
    
    
    8,6442011
    
    
    8,6672012
    
    
    8,5722013
    
    
    8,353Thereafter
    
    
    107,136Total
    
    $
    149,776
  Page 115




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##### Table of Contents



8. Deposits
  2008
    
    
    2007Weighted
    
    
    
    
    
    
    
    
    
    
    WeightedBalance
    
    
    Percent
    
    
    Average Rate
    
    
    Balance
    
    
    Percent
    
    
    Average Rate(Dollars in thousands)Savings
    
    $
    712,420
    
    
    
    3.86
    %
    
    
    0.76
    %
    
    $
    737,813
    
    
    
    4.87
    %
    
    
    0.74
    %Noninterest-bearing demand
    
    
    514,196
    
    
    
    2.78
    
    
    
    
    
    
    
    517,970
    
    
    
    3.42
    
    
    
    Interest-bearing demand
    
    
    1,573,771
    
    
    
    8.52
    
    
    
    2.47
    
    
    
    1,588,084
    
    
    
    10.48
    
    
    
    3.26Money market
    
    
    2,716,429
    
    
    
    14.72
    
    
    
    2.87
    
    
    
    1,575,097
    
    
    
    10.39
    
    
    
    4.26Time deposits
    
    
    12,947,226
    
    
    
    70.12
    
    
    
    3.69
    
    
    
    10,734,418
    
    
    
    70.84
    
    
    
    4.93Total deposits
    
    $
    18,464,042
    
    
    
    100.00
    %
    
    
    3.25
    %
    
    $
    15,153,382
    
    
    
    100.00
    %
    
    
    4.31
    %
   Year
    
    Amount(In thousands)2009
    
    $
    12,476,9582010
    
    
    400,6462011
    
    
    31,6772012
    
    
    22,0182013
    
    
    15,927Total
    
    $
    12,947,226
 Page 116




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##### Table of Contents



9. Borrowed Funds
  2008
    
    
    2007Weighted
    
    
    
    
    
    
    WeightedAverage
    
    
    
    
    
    
    AveragePrincipal
    
    
    Rate
    
    
    Principal
    
    
    Rate(Dollars in thousands)Securities sold under agreements to repurchase:FHLB
    
    $
    2,400,000
    
    
    
    4.44
    %
    
    $
    2,066,000
    
    
    
    4.62
    %Other brokers
    
    
    12,700,000
    
    
    
    3.91
    
    
    
    9,950,000
    
    
    
    4.15Total securities sold under agreements to repurchase
    
    
    15,100,000
    
    
    
    3.99
    
    
    
    12,016,000
    
    
    
    4.23Advances from the FHLB
    
    
    15,125,000
    
    
    
    3.94
    
    
    
    12,125,000
    
    
    
    4.20Total borrowed funds
    
    $
    30,225,000
    
    
    
    3.97
    
    
    $
    24,141,000
    
    
    
    4.22Accrued interest payable
    
    $
    138,351
    
    
    
    
    
    
    $
    115,012
  At or for the Year Ended December 31,2008
    
    
    2007
    
    
    2006(Dollars in thousands)Repurchase Agreements:Average balance outstanding during the year
    
    $
    13,465,540
    
    
    $
    10,305,216
    
    
    $
    8,313,321Maximum balance outstanding at any month-end
during the year
    
    $
    15,100,000
    
    
    $
    12,016,000
    
    
    $
    8,923,000Weighted average rate during the period
    
    
    4.17
    %
    
    
    4.20
    %
    
    
    3.81
    %FHLB Advances:Average balance outstanding during the year
    
    $
    13,737,057
    
    
    $
    10,286,869
    
    
    $
    5,977,115Maximum balance outstanding at any month-end
during the year
    
    $
    15,125,000
    
    
    $
    12,125,000
    
    
    $
    8,050,000Weighted average rate during the period
    
    
    4.14
    %
    
    
    4.28
    %
    
    
    4.17
    %
 Page 117




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##### Table of Contents



Borrowings by Scheduled
    
    
    Borrowings by Earler of ScheduledMaturity Date
    
    
    Maturity or Next Potential Call DateWeighted
    
    
    
    
    
    
    WeightedAverage
    
    
    
    
    
    
    AverageYear
    
    Principal
    
    
    Rate
    
    
    Principal
    
    
    Rate(Dollars in thousands)2009
    
    $
    600,000
    
    
    
    2.02
    %
    
    $
    21,725,000
    
    
    
    4.17
    %2010
    
    
    300,000
    
    
    
    5.68
    
    
    
    2,850,000
    
    
    
    3.702011
    
    
    250,000
    
    
    
    4.90
    
    
    
    5,050,000
    
    
    
    3.212012
    
    
    100,000
    
    
    
    4.76
    
    
    
    600,000
    
    
    
    4.332013
    
    
    250,000
    
    
    
    5.30
    
    
    
    
    
    
    
    2014
    
    
    350,000
    
    
    
    3.37
    
    
    
    
    
    
    
    2015
    
    
    3,725,000
    
    
    
    3.85
    
    
    
    
    
    
    
    2016
    
    
    8,075,000
    
    
    
    4.32
    
    
    
    
    
    
    
    2017
    
    
    10,725,000
    
    
    
    4.22
    
    
    
    
    
    
    
    2018
    
    
    5,850,000
    
    
    
    3.13
    
    
    
    
    
    
    
    Total
    
    $
    30,225,000
    
    
    
    3.97
    
    
    $
    30,225,000
    
    
    
    3.97
  At or for the Year Ended December 31,2008
    
    
    2007
    
    
    2006(Dollars in thousands)Amortized cost of collateral:United States government-sponsored enterprise securities
    
    $
    2,150,000
    
    
    $
    3,620,083
    
    
    $
    3,329,639Mortgage-backed securities
    
    
    15,572,838
    
    
    
    9,308,551
    
    
    
    6,257,678Total amortized cost of collateral
    
    $
    17,722,838
    
    
    $
    12,928,634
    
    
    $
    9,587,317Fair value of collateral:United States government-sponsored enterprise securities
    
    $
    2,159,471
    
    
    $
    3,626,572
    
    
    $
    3,195,765Mortgage-backed securities
    
    
    15,759,490
    
    
    
    9,294,264
    
    
    
    6,143,223Total fair value of collateral
    
    $
    17,918,961
    
    
    $
    12,920,836
    
    
    $
    9,338,988
  Page 118




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##### Table of Contents



10. Employee Benefit Plans
 a) Retirement and Other Postretirement Benefits
   Page 119




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##### Table of Contents



Retirement Plans
    
    
    Other Benefits2008
    
    
    2007
    
    
    2008
    
    
    2007(In thousands)Change in Benefit Obligation:Benefit obligation at beginning of year
    
    $
    114,491
    
    
    $
    106,069
    
    
    $
    37,245
    
    
    $
    35,850Service cost
    
    
    3,285
    
    
    
    3,358
    
    
    
    1,122
    
    
    
    945Interest cost
    
    
    6,675
    
    
    
    6,392
    
    
    
    2,272
    
    
    
    2,058Plan amendments
    
    
    
    
    
    
    1,205
    
    
    
    
    
    
    
    Participant contributions
    
    
    
    
    
    
    
    
    
    
    40
    
    
    
    36Actuarial loss (gain)
    
    
    11,921
    
    
    
    1,575
    
    
    
    (1,116
    )
    
    
    (73
    )Benefits paid
    
    
    (4,238
    )
    
    
    (4,108
    )
    
    
    (1,851
    )
    
    
    (1,679
    )Medicare subsidy
    
    
    
    
    
    
    
    
    
    
    108
    
    
    
    108Benefit obligation at end of year
    
    
    132,134
    
    
    
    114,491
    
    
    
    37,820
    
    
    
    37,245Change in Plan Assets:Fair value of plan assets at beginning of year
    
    
    104,063
    
    
    
    99,568
    
    
    
    
    
    
    
    Actual return on plan assets
    
    
    (22,030
    )
    
    
    6,161
    
    
    
    
    
    
    
    Employer contributions
    
    
    18,532
    
    
    
    2,442
    
    
    
    1,811
    
    
    
    1,643Participant contributions
    
    
    
    
    
    
    
    
    
    
    40
    
    
    
    36Benefits paid
    
    
    (4,238
    )
    
    
    (4,108
    )
    
    
    (1,851
    )
    
    
    (1,679
    )Fair value of plan assets at end of year
    
    
    96,327
    
    
    
    104,063
    
    
    
    
    
    
    
    Funded status
    
    $
    (35,807
    )
    
    $
    (10,428
    )
    
    $
    (37,820
    )
    
    $
    (37,245
    )
  Retirement Plans
    
    
    Other Benefits2008
    
    
    2007
    
    
    2008
    
    
    2007(In thousands)Accrued expenses and other liabilities
    
    $
    (35,807
    )
    
    $
    (10,428
    )
    
    $
    (37,820
    )
    
    $
    (37,245
    )
  Retirement Plans
    
    
    Other Benefits2008
    
    
    2007
    
    
    2008
    
    
    2007(In thousands)Net actuarial loss
    
    $
    55,748
    
    
    $
    14,725
    
    
    $
    11,261
    
    
    $
    13,064Prior service cost (credit)
    
    
    2,577
    
    
    
    2,902
    
    
    
    (24,035
    )
    
    
    (25,600
    )Total
    
    $
    58,325
    
    
    $
    17,627
    
    
    $
    (12,774
    )
    
    $
    (12,536
    )
  Page 120




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Retirement Plans
    
    
    Other Benefits2008
    
    
    2007
    
    
    2006
    
    
    2008
    
    
    2007
    
    
    2006(In thousands)Net periodic benefit cost:Service cost
    
    $
    3,285
    
    
    $
    3,358
    
    
    $
    3,404
    
    
    $
    1,122
    
    
    $
    945
    
    
    $
    1,076Interest cost
    
    
    6,675
    
    
    
    6,392
    
    
    
    5,766
    
    
    
    2,272
    
    
    
    2,058
    
    
    
    1,996Expected return on assets
    
    
    (8,530
    )
    
    
    (8,269
    )
    
    
    (8,447
    )
    
    
    
    
    
    
    
    
    
    
    Amortization of:Net actuarial loss
    
    
    252
    
    
    
    284
    
    
    
    943
    
    
    
    687
    
    
    
    575
    
    
    
    645Prior service cost (credit)
    
    
    325
    
    
    
    300
    
    
    
    168
    
    
    
    (1,565
    )
    
    
    (1,565
    )
    
    
    (1,565
    )Net periodic benefit cost
    
    
    2,007
    
    
    
    2,065
    
    
    
    1,834
    
    
    
    2,516
    
    
    
    2,013
    
    
    
    2,152Other changes in plan assets and benefit obligations
recognized in other comprehensive income:Net actuarial loss (gain)
    
    
    41,275
    
    
    
    3,878
    
    
    
    
    
    
    
    (1,116
    )
    
    
    (74
    )
    
    
    Prior service cost (credit)
    
    
    
    
    
    
    677
    
    
    
    
    
    
    
    
    
    
    
    (1,537
    )
    
    
    Amortization of net actuarial loss
    
    
    (252
    )
    
    
    (284
    )
    
    
    
    
    
    
    (687
    )
    
    
    (575
    )
    
    
    Amortization of prior service cost
    
    
    (325
    )
    
    
    (300
    )
    
    
    
    
    
    
    1,565
    
    
    
    1,565
    
    
    
    Total recognized in other comprehensive
income
    
    
    40,698
    
    
    
    3,971
    
    
    
    
    
    
    
    (238
    )
    
    
    (621
    )
    
    
    Total recognized in net periodic benefit cost
and other comprehensive income
    
    $
    42,705
    
    
    $
    6,036
    
    
    $
    1,834
    
    
    $
    2,278
    
    
    $
    1,392
    
    
    $
    2,152
   Retirement Plans
    
    Other Benefits2008
    
    2007
    
    2006
    
    2008
    
    2007
    
    2006Discount rate
    
    
    6.00
    %
    
    
    6.00
    %
    
    
    5.75
    %
    
    
    6.00
    %
    
    
    6.00
    %
    
    
    5.75
    %Expected return on assets
    
    
    8.25
    
    
    
    8.25
    
    
    
    8.75
    
    
    
    
    
    
    
    
    
    
    
    Rate of compensation increase
    
    
    4.25
    
    
    
    4.25
    
    
    
    4.25
    
    
    
    
    
    
    
    
    
    
    
    
  Retirement Plans
    
    Other Benefits2008
    
    2007
    
    2008
    
    2007Discount rate
    
    
    5.75
    %
    
    
    6.00
    %
    
    
    5.75
    %
    
    
    6.00
    %Rate of compensation increase
    
    
    4.00
    
    
    
    4.25
    
    
    
    
    
    
    
    
  Page 121




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1% Increase
    
    1% DecreaseEffect on total service cost and interest cost
    
    $
    87
    
    
    $
    (76
    )Effect on other benefit obligations
    
    
    1,104
    
    
    
    (833
    )
  Asset Category
    
    2008
    
    2007Equity securities
    
    
    59.4
    %
    
    
    61.0
    %Fixed income securities
    
    
    29.1
    
    
    
    32.5Cash
    
    
    11.5
    
    
    
    6.5Total
    
    
    100.0
    %
    
    
    100.0
    %
    Page 122




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Retirement
    
    OtherYear
    
    Plans
    
    Benefits(In thousands)2009
    
    $
    5,061
    
    
    $
    2,0022010
    
    
    5,189
    
    
    
    2,1182011
    
    
    5,448
    
    
    
    2,2892012
    
    
    5,841
    
    
    
    2,4532013
    
    
    6,845
    
    
    
    2,6342014 through 2018
    
    
    43,587
    
    
    
    14,390
 b) Employee Stock Ownership Plan
     Page 123




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c) Recognition and Retention Plans
      Resticted Stock Awards2007
    
    2006
    
    2005Weighted
    
    
    
    
    
    Weighted
    
    
    
    
    
    WeightedAverage
    
    
    
    
    
    Average
    
    
    
    
    
    AverageNumber of
    
    Grant Date
    
    Number of
    
    Grant Date
    
    Number of
    
    Grant DateShares
    
    Fair Value
    
    Shares
    
    Fair Value
    
    Shares
    
    Fair ValueOutstanding at beginning of period
    
    
    350,576
    
    
    $
    11.74
    
    
    
    540,851
    
    
    $
    11.57
    
    
    
    951,761
    
    
    $
    9.69Granted
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Vested
    
    
    (126,159
    )
    
    
    11.75
    
    
    
    (190,275
    )
    
    
    11.27
    
    
    
    (410,910
    )
    
    
    7.22Outstanding at end of period
    
    
    224,417
    
    
    
    11.73
    
    
    
    350,576
    
    
    
    11.74
    
    
    
    540,851
    
    
    
    11.57
  d) Stock Option Plans
  Page 124




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2008
    
    
    2007
    
    
    2006Expected dividend yield
    
    
    2.30
    %
    
    
    2.32
    %
    
    
    2.35
    %Expected volatility
    
    
    20.61
    
    
    
    19.12
    
    
    
    19.96Risk-free interest rate
    
    
    2.82
    
    
    
    4.87
    
    
    
    4.98Expected option life
    
    5.30 years
    
    5.20 years
    
    5.40 yearsFair value of options granted
    
    
    $  2.76
    
    
    
    $  2.77
    
    
    
    $  2.71
  Page 125




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2007
    
    2006
    
    2005Weighted
    
    
    
    
    
    Weighted
    
    
    
    
    
    WeightedNumber of
    
    Average
    
    Number of
    
    Average
    
    Number of
    
    AverageStock
    
    Exercise
    
    Stock
    
    Exercise
    
    Stock
    
    ExerciseOptions
    
    Price
    
    Options
    
    Price
    
    Options
    
    PriceOutstanding at beginning
of year
    
    
    29,080,114
    
    
    $
    7.91
    
    
    
    26,979,989
    
    
    $
    6.89
    
    
    
    21,659,869
    
    
    $
    4.21Granted
    
    
    4,025,000
    
    
    
    15.96
    
    
    
    3,527,500
    
    
    
    13.74
    
    
    
    7,960,000
    
    
    
    12.76Exercised
    
    
    (6,325,277
    )
    
    
    2.69
    
    
    
    (1,360,635
    )
    
    
    2.67
    
    
    
    (2,629,621
    )
    
    
    2.60Forfeited
    
    
    (51,718
    )
    
    
    13.10
    
    
    
    (66,740
    )
    
    
    10.03
    
    
    
    (10,259
    )
    
    
    4.21Outstanding at end of year
    
    
    26,728,119
    
    
    
    10.35
    
    
    
    29,080,114
    
    
    
    7.91
    
    
    
    26,979,989
    
    
    
    6.89
   Options Outstanding
    
    Options ExercisableWeightedAverage
    
    Weighted
    
    
    
    
    
    WeightedNumber
    
    Remaining
    
    Average
    
    Number
    
    
    AverageOf Options
    
    Contractual
    
    Exercise
    
    Of Options
    
    
    ExerciseOutstanding
    
    Life
    
    Price
    
    Exercisable
    
    
    Price5,761,288
    
    1  years
    
    $
    2.16
    
    
    
    5,761,288
    
    
    $
    2.16147,619
    
    2  years
    
    
    3.09
    
    
    
    147,619
    
    
    
    3.09820,736
    
    2  years
    
    
    3.59
    
    
    
    820,736
    
    
    
    3.5969,501
    
    3  years
    
    
    4.20
    
    
    
    69,501
    
    
    
    4.20614,440
    
    3  years
    
    
    5.53
    
    
    
    614,440
    
    
    
    5.53163,580
    
    4  years
    
    
    5.96
    
    
    
    163,580
    
    
    
    5.96206,480
    
    4  years
    
    
    6.35
    
    
    
    206,480
    
    
    
    6.35448,840
    
    5  years
    
    
    10.33
    
    
    
    359,072
    
    
    
    10.33420,584
    
    6  years
    
    
    11.17
    
    
    
    244,880
    
    
    
    11.17308,210
    
    5  years
    
    
    11.91
    
    
    
    230,210
    
    
    
    11.912,349,341
    
    5  years
    
    
    12.22
    
    
    
    1,432,410
    
    
    
    12.227,910,000
    
    7.5 years
    
    
    12.76
    
    
    
    500,000
    
    
    
    12.76350,000
    
    8.5 years
    
    
    13.35
    
    
    
    350,000
    
    
    
    13.353,132,500
    
    8 years
    
    
    13.78
    
    
    
    135,000
    
    
    
    13.783,675,000
    
    9 years
    
    
    15.69
    
    
    
    
    
    
    
    15.69350,000
    
    9 years
    
    
    18.84
    
    
    
    
    
    
    
    18.8426,728,119
    
    
    
    
    
    $
    10.35
    
    
    
    11,035,216
    
    
    $
    5.57
  Page 126




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e) Incentive Plans
   11. Income Taxes
  2008
    
    
    2007
    
    
    2006(In thousands)Federal:Current
    
    $
    255,511
    
    
    $
    170,374
    
    
    $
    161,558Deferred
    
    
    (9,372
    )
    
    
    (7,896
    )
    
    
    (2,443
    )Total federal
    
    
    246,139
    
    
    
    162,478
    
    
    
    159,115State:Current
    
    
    44,685
    
    
    
    24,941
    
    
    
    14,091Deferred
    
    
    (3,496
    )
    
    
    (1,534
    )
    
    
    (1,216
    )Total state
    
    
    41,189
    
    
    
    23,407
    
    
    
    12,875Total income tax expense
    
    $
    287,328
    
    
    $
    185,885
    
    
    $
    171,990
   2008
    
    
    2007
    
    
    2006(Dollars in thousands)Income before income tax expense
    
    $
    732,886
    
    
    $
    481,743
    
    
    $
    460,569Statutory income tax rate
    
    
    35
    %
    
    
    35
    %
    
    
    35
    %Computed expected income tax expense
    
    
    256,510
    
    
    
    168,610
    
    
    
    161,199State income taxes, net of federal income tax benefit
    
    
    26,773
    
    
    
    15,215
    
    
    
    8,369ESOP fair market value adjustment
    
    
    3,665
    
    
    
    2,559
    
    
    
    2,345Other, net
    
    
    380
    
    
    
    (499
    )
    
    
    77Income tax expense
    
    $
    287,328
    
    
    $
    185,885
    
    
    $
    171,990
 Page 127




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##### Table of Contents



2008
    
    
    2007(In thousands)Deferred tax asset:Postretirement benefits
    
    $
    43,462
    
    
    $
    20,936Allowance for loan losses
    
    
    19,701
    
    
    
    13,340Mortgage premium amortization
    
    
    7,269
    
    
    
    7,535Non-qualified benefit plans
    
    
    37,314
    
    
    
    31,802ESOP expense
    
    
    7,245
    
    
    
    5,742Fair value adjustment on mortgages recorded in Acquisition
    
    
    3,548
    
    
    
    4,093Other
    
    
    7,335
    
    
    
    6,787125,874
    
    
    
    90,235Deferred tax liabilities:Postretirement benefits
    
    
    17,874
    
    
    
    10,969Net unrealized gain on securities available for sale
    
    
    51,522
    
    
    
    13,561Fair value adjustments related to the Acquisition:Core deposit intangible
    
    
    3,308
    
    
    
    4,177Buildings
    
    
    1,827
    
    
    
    2,007Other
    
    
    702
    
    
    
    37775,233
    
    
    
    31,091Net deferred tax asset (included in other assets)
    
    $
    50,641
    
    
    $
    59,144
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2008
    
    
    2007(in thousands)Balance at January 1
    
    $
    2,189
    
    
    $
    1,834Additions based on tax positions related
to the current year
    
    
    1,266
    
    
    
    502Additions for tax positions of prior years
    
    
    
    
    
    
    Reductions for tax positions of prior years
    
    
    (243
    )
    
    
    (147
    )Balance at December 31
    
    $
    3,212
    
    
    $
    2,189
  12. Fair Value Measurements and Disclosures
 a) Fair Value Measurements
    
    
    Level 1  Valuation is based upon quoted prices for identical instruments traded in active
markets.
 Page 129




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##### Table of Contents




    
    Level 2  Valuation is based upon quoted prices for similar instruments in active markets,
quoted prices for identical or similar instruments in markets that are not active and model-based
valuation techniques for which all significant assumptions are observable in the market.
 
    
    Level 3  Valuation is generated from model-based techniques that use significant assumptions
not observable in the market. These unobservable assumptions reflect our own estimates of
assumptions that market participants would use in pricing the asset or liability. Valuation
techniques include the use of option pricing models, discounted cash flow models and similar
techniques. The results cannot be determined with precision and may not be realized in an actual
sale or immediate settlement of the asset or liability.
    Fair Value Measurements at December 31, 2008Quoted Prices in Active
    
    
    Significant Other
    
    
    SignificantCarrying
    
    
    Markets for Identical
    
    
    Observable Inputs
    
    
    Unobservable InputsDescription
    
    Value
    
    
    Assets (Level 1)
    
    
    (Level 2)
    
    
    (Level 3)(In thousands)Available for sale:Mortgage-backed securities
    
    $
    9,915,554
    
    
    $
    
    
    
    $
    9,915,554
    
    
    $
    Investment securities
    
    
    3,413,633
    
    
    
    7,385
    
    
    
    3,406,248
    
    
    
    Total available for sale
    
    $
    13,329,187
    
    
    $
    7,385
    
    
    $
    13,321,802
    
    
    $
    
  Page 130




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##### Table of Contents



Fair Value Measurements at December 31, 2008Quoted Prices in Active
    
    Significant Other
    
    SignificantMarkets for Identical
    
    Observable Inputs
    
    Unobservable InputsDescription
    
    Assets (Level 1)
    
    (Level 2)
    
    (Level 3)(In thousands)Impaired loans
    
    $
    
    
    
    $
    
    
    
    $
    9,464Foreclosed real estate
    
    
    
    
    
    
    
    
    
    
    15,532
 b) Fair Value Disclosures
     Page 131




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2008
    
    2007Carrying
    
    Estimated
    
    Carrying
    
    EstimatedAmount
    
    Fair Value
    
    Amount
    
    Fair Value(In thousands)Assets:Cash and due from banks
    
    $
    184,915
    
    
    $
    184,915
    
    
    $
    111,245
    
    
    $
    111,245Federal funds sold
    
    
    76,896
    
    
    
    76,896
    
    
    
    106,299
    
    
    
    106,299Investment securities held to maturity
    
    
    50,086
    
    
    
    50,512
    
    
    
    1,408,501
    
    
    
    1,410,246Investment securities available for sale
    
    
    3,413,633
    
    
    
    3,413,633
    
    
    
    2,765,491
    
    
    
    2,765,491Federal Home Loan Bank of New York stock
    
    
    865,570
    
    
    
    865,570
    
    
    
    695,351
    
    
    
    695,351Mortgage-backed securities held to maturity
    
    
    9,572,257
    
    
    
    9,695,445
    
    
    
    9,565,526
    
    
    
    9,566,312Mortgage-backed securities available for sale
    
    
    9,915,554
    
    
    
    9,915,554
    
    
    
    5,005,409
    
    
    
    5,005,409Loans
    
    
    29,440,761
    
    
    
    29,743,919
    
    
    
    24,198,138
    
    
    
    24,270,758Liabilities:Deposits
    
    
    18,464,042
    
    
    
    18,486,681
    
    
    
    15,153,382
    
    
    
    15,162,402Borrowed funds
    
    
    30,225,000
    
    
    
    34,156,052
    
    
    
    24,141,000
    
    
    
    25,046,472
 13. Regulatory Matters
   Page 132




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OTS RequirementsMinimum Capital
    
    
    For Classification asBank Actual
    
    
    Adequacy
    
    
    Well-CapitalizedAmount
    
    
    Ratio
    
    
    Amount
    
    
    Ratio
    
    
    Amount
    
    
    Ratio(Dollars in thousands)December 31, 2008Tangible capital
    
    $
    4,290,316
    
    
    
    7.99
    %
    
    $
    805,475
    
    
    
    1.50
    %
    
    
    n/a
    
    
    
    n/aLeverage (core) capital
    
    
    4,290,316
    
    
    
    7.99
    
    
    
    2,147,935
    
    
    
    4.00
    
    
    $
    2,684,918
    
    
    
    5.00
    %Total-risk-based capital
    
    
    4,340,315
    
    
    
    21.52
    
    
    
    1,613,657
    
    
    
    8.00
    
    
    
    2,017,071
    
    
    
    10.00December 31, 2007Tangible capital
    
    $
    4,055,952
    
    
    
    9.16
    %
    
    $
    664,169
    
    
    
    1.50
    %
    
    
    n/a
    
    
    
    n/aLeverage (core) capital
    
    
    4,055,952
    
    
    
    9.16
    
    
    
    1,771,118
    
    
    
    4.00
    
    
    $
    2,213,898
    
    
    
    5.00
    %Total-risk-based capital
    
    
    4,090,693
    
    
    
    24.83
    
    
    
    1,318,102
    
    
    
    8.00
    
    
    
    1,647,627
    
    
    
    10.00
     Page 133




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14. Commitments and Contingencies
     Page 134




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15. Parent Company Only Financial Statements
  Statements of Financial Condition
 December 31, 2008
    
    
    December 31, 2007(In thousands)Assets:Cash and due from subsidiary bank
    
    $
    205,765
    
    
    $
    140,486Investment in subsidiary
    
    
    4,498,248
    
    
    
    4,234,428ESOP loan receivable
    
    
    234,300
    
    
    
    236,629Other assets
    
    
    483
    
    
    
    Total Assets
    
    $
    4,938,796
    
    
    $
    4,611,543Liabilities and Stockholders Equity:Accrued expenses
    
    $
    
    
    
    $
    236Total stockholders equity
    
    
    4,938,796
    
    
    
    4,611,307Total Liabilities and Stockholders Equity
    
    $
    4,938,796
    
    
    $
    4,611,543
 Statements of Income
 Year Ended December 31,2008
    
    
    2007
    
    
    2006(In thousands)Income:Dividends received from subsidiary
    
    $
    288,442
    
    
    $
    278,176
    
    
    $
    282,929Interest on ESOP loan receivable
    
    
    11,831
    
    
    
    11,942
    
    
    
    12,048Interest on deposit with subsidiary
    
    
    3,017
    
    
    
    2,820
    
    
    
    6,674Total income
    
    
    303,290
    
    
    
    292,938
    
    
    
    301,651Expenses
    
    
    1,037
    
    
    
    1,059
    
    
    
    1,273Income before income tax expense and equity in
undistributed (overdistributed) earnings of subsidiary
    
    
    302,253
    
    
    
    291,879
    
    
    
    300,378Income tax expense
    
    
    4,461
    
    
    
    5,115
    
    
    
    6,515Income before equity in undistributed (overdistributed)
earnings of subsidiary
    
    
    297,792
    
    
    
    286,764
    
    
    
    293,863Equity in undistributed (overdistributed) earnings
of subsidiary
    
    
    147,766
    
    
    
    9,094
    
    
    
    (5,284
    )Net income
    
    $
    445,558
    
    
    $
    295,858
    
    
    $
    288,579
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Statements of Cash Flows
 Year Ended December 31,2008
    
    
    2007
    
    
    2006(In thousands)Cash Flows from Operating Activities:Net income
    
    $
    445,558
    
    
    $
    295,858
    
    
    $
    288,579Adjustments to reconcile net income
to net cash provided by operating activities:Equity in (undistributed) overdistributed earnings
    
    
    (147,766
    )
    
    
    (9,094
    )
    
    
    5,284(Increase) decrease in other assets
    
    
    (483
    )
    
    
    
    
    
    
    83(Decrease) increase in accrued expenses
    
    
    (236
    )
    
    
    (729
    )
    
    
    126Net Cash Provided by Operating Activities
    
    
    297,073
    
    
    
    286,035
    
    
    
    294,072Cash Flows from Investing Activities:Principal collected on ESOP loan
    
    
    2,329
    
    
    
    2,217
    
    
    
    2,112Net Cash Provided by Investing Activities
    
    
    2,329
    
    
    
    2,217
    
    
    
    2,112Cash Flows from Financing Activities:Purchases of treasury stock
    
    
    (17,045
    )
    
    
    (550,215
    )
    
    
    (448,237
    )Exercise of stock options
    
    
    16,936
    
    
    
    3,629
    
    
    
    6,819Cash dividends paid on unallocated ESOP shares
    
    
    (16,019
    )
    
    
    (12,067
    )
    
    
    (11,257
    )Cash dividends paid
    
    
    (217,995
    )
    
    
    (165,376
    )
    
    
    (161,374
    )Net Cash Used in Financing Activities
    
    
    (234,123
    )
    
    
    (724,029
    )
    
    
    (614,049
    )Net Increase (Decrease) in Cash Due from Bank
    
    
    65,279
    
    
    
    (435,777
    )
    
    
    (317,865
    )Cash Due from Bank at Beginning of Year
    
    
    140,486
    
    
    
    576,263
    
    
    
    894,128Cash Due from Bank at End of Year
    
    $
    205,765
    
    
    $
    140,486
    
    
    $
    576,263
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16. Selected Quarterly Financial Data (Unaudited)
  2008 Quarter EndedMarch 31
    
    
    June 30
    
    
    September 30
    
    
    December 31(In thousands, except per share data)Interest and dividend income
    
    $
    613,288
    
    
    $
    646,660
    
    
    $
    681,317
    
    
    $
    711,960Interest expense
    
    
    419,973
    
    
    
    413,528
    
    
    
    426,239
    
    
    
    451,508Net interest income
    
    
    193,315
    
    
    
    233,132
    
    
    
    255,078
    
    
    
    260,452Provision for loan losses
    
    
    2,500
    
    
    
    3,000
    
    
    
    5,000
    
    
    
    9,000Net interest income after
provision for loan losses
    
    
    190,815
    
    
    
    230,132
    
    
    
    250,078
    
    
    
    251,452Non-interest income
    
    
    2,221
    
    
    
    2,088
    
    
    
    2,181
    
    
    
    1,995Non-interest expense
    
    
    48,112
    
    
    
    48,277
    
    
    
    49,423
    
    
    
    52,264Income before income tax expense
    
    
    144,924
    
    
    
    183,943
    
    
    
    202,836
    
    
    
    201,183Income tax expense
    
    
    56,255
    
    
    
    73,240
    
    
    
    80,928
    
    
    
    76,905Net income
    
    $
    88,669
    
    
    $
    110,703
    
    
    $
    121,908
    
    
    $
    124,278Basic earnings per share
    
    $
    0.18
    
    
    $
    0.23
    
    
    $
    0.25
    
    
    $
    0.25Diluted earnings per share
    
    $
    0.18
    
    
    $
    0.22
    
    
    $
    0.25
    
    
    $
    0.25
 2007 Quarter EndedMarch 31
    
    
    June 30
    
    
    September 30
    
    
    December 31(In thousands, except per share data)Interest and dividend income
    
    $
    479,647
    
    
    $
    511,494
    
    
    $
    548,203
    
    
    $
    588,161Interest expense
    
    
    323,193
    
    
    
    353,836
    
    
    
    385,987
    
    
    
    417,306Net interest income
    
    
    156,454
    
    
    
    157,658
    
    
    
    162,216
    
    
    
    170,855Provision for loan losses
    
    
    300
    
    
    
    500
    
    
    
    2,000
    
    
    
    2,000Net interest income after
provision for loan losses
    
    
    156,154
    
    
    
    157,158
    
    
    
    160,216
    
    
    
    168,855Non-interest income
    
    
    1,550
    
    
    
    1,823
    
    
    
    2,049
    
    
    
    1,851Non-interest expense
    
    
    41,097
    
    
    
    40,867
    
    
    
    41,188
    
    
    
    44,761Income before income tax expense
    
    
    116,607
    
    
    
    118,114
    
    
    
    121,077
    
    
    
    125,945Income tax expense
    
    
    45,364
    
    
    
    45,450
    
    
    
    46,634
    
    
    
    48,437Net income
    
    $
    71,243
    
    
    $
    72,664
    
    
    $
    74,443
    
    
    $
    77,508Basic earnings per share
    
    $
    0.14
    
    
    $
    0.14
    
    
    $
    0.15
    
    
    $
    0.16Diluted earnings per share
    
    $
    0.13
    
    
    $
    0.14
    
    
    $
    0.15
    
    
    $
    0.16
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17. Earnings Per Share
  For the Year Ended December 31,2008
    
    
    
    
    
    
    
    
    
    
    2007
    
    
    
    
    
    
    
    
    
    
    2006Per
    
    
    
    
    
    
    
    
    
    
    Per
    
    
    
    
    
    
    
    
    
    
    PerShare
    
    
    
    
    
    
    
    
    
    
    Share
    
    
    
    
    
    
    
    
    
    
    ShareIncome
    
    
    Shares
    
    
    Amount
    
    
    Income
    
    
    Shares
    
    
    Amount
    
    
    Income
    
    
    Shares
    
    
    Amount(In thousands, except per share data)Net income
    
    $
    445,558
    
    
    
    
    
    
    
    
    
    
    $
    295,858
    
    
    
    
    
    
    
    
    
    
    $
    288,579Basic earnings per share:Income available to
common stockholders
    
    $
    445,558
    
    
    
    484,907
    
    
    $
    0.92
    
    
    $
    295,858
    
    
    
    499,608
    
    
    $
    0.59
    
    
    $
    288,579
    
    
    
    536,215
    
    
    $
    0.54Effect of dilutive common
stock equivalents
    
    
    
    
    
    
    10,949
    
    
    
    
    
    
    
    
    
    
    
    10,319
    
    
    
    
    
    
    
    
    
    
    
    10,576Diluted earnings per share:Income available to
common stockholders
    
    $
    445,558
    
    
    
    495,856
    
    
    $
    0.90
    
    
    $
    295,858
    
    
    
    509,927
    
    
    $
    0.58
    
    
    $
    288,579
    
    
    
    546,791
    
    
    $
    0.53
 18. Recent Accounting Pronouncements
    Page 138




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purchase method
  Page 139




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##### Table of Contents



,
 
 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.
  Page 140




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Item 9A. Controls and Procedures.
 Evaluation of Disclosure Controls and Procedures
  Changes in Internal Control Over Financial Reporting
  Management Report on Internal Control Over Financial Reporting
    Internal
Control-Integrated Framework
  Page 141




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##### Table of Contents



Item 9B. Other Information.
  
 PART III
 
 Item 10. Directors, Executive Officers and Corporate Governance.
  Audit Committee Financial Expert
  Code of Ethics
  
 Item 11. Executive Compensation.
  
 Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder
Matters.
  Page 142




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##### Table of Contents



Item 13. Certain Relationships and Related Transactions, and Director Independence
  
 Item 14. Principal Accounting Fees and Services.
  
 PART IV
 
 Item 15. Exhibits, Financial Statement Schedules.
  (1)
    
    The following consolidated financial statements are in Item 8 of
this annual report:
    
    Reports of Independent Registered Public Accounting Firm
    
    Consolidated Statements of Financial Condition as of December 31, 2008 and 2007
    
    Consolidated Statements of Income for the years ended December 31, 2008, 2007 and 2006
    
    Consolidated Statements of Changes in Shareholders Equity for the years ended December 31, 2008, 2007 and 2006
    
    Consolidated Statements of Cash Flows for the years ended December 31, 2008, 2007 and 2006
    
    Notes to Consolidated Financial Statements(2)
    
    Financial Statement Schedules have been omitted because they are
not applicable or the required information is shown in the Consolidated Financial
Statements or Notes thereto in Item 8 of this annual report.
  Page 143




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EXHIBIT
    
    DESCRIPTION2.1
    
    
    Amended and Restated Plan of Conversion and Reorganization of Hudson City, MHC, Hudson City
Bancorp, Inc. and Hudson City Savings Bank(1)2.2
    
    
    Agreement and Plan of Merger by and between Hudson City Bancorp, Inc. and Sound Federal
Bancorp, Inc.(2)3.1
    
    
    Certificate of Incorporation of Hudson City Bancorp, Inc.(3)3.2
    
    
    Amended and Restated Bylaws of Hudson City Bancorp, Inc.(4)4.1
    
    
    Certificate of Incorporation of Hudson City Bancorp, Inc. (See Exhibit 3.1)4.2
    
    
    Amended and Restated Bylaws of Hudson City Bancorp, Inc. (See Exhibit 3.2)4.3
    
    
    Form of Stock Certificate of Hudson City Bancorp, Inc.(3)10.1
    
    
    Employee Stock Ownership Plan of Hudson City Savings Bank (Incorporating amendments No. 1,
2, 3, 4, 5 and 6)(13)10.2
    
    
    Profit Incentive Bonus Plan of Hudson City Savings Bank(5)10.3
    
    
    Form of Amended and Restated Two-Year Change in Control Agreement by and among Hudson City
Savings Bank and Hudson City Bancorp, Inc. and certain officers (together with Schedule
pursuant to Instruction 2 of Item 601 of Regulation S-K)*10.4
    
    
    Severance Pay Plan of Hudson City Savings Bank(3)10.5
    
    
    Hudson City Savings Bank Outside Directors Consultation Plan(3)10.6
    
    
    Hudson City Bancorp, Inc. 2000 Stock Option Plan(6)10.7
    
    
    Hudson City Bancorp, Inc. 2000 Recognition and Retention Plan(6)10.8
    
    
    Hudson City Bancorp, Inc. Denis J. Salamone Stock Option Plan(7)10.9
    
    
    Hudson City Bancorp, Inc. 2005 Employment Inducement Stock Program with Ronald E. Butkovich(8)10.10
    
    
    Hudson City Bancorp, Inc. 2005 Employment Inducement Stock Program with Christopher Nettleton(8)10.11
    
    
    Amended and Restated Employment Agreement between Hudson City Bancorp, Inc. and Ronald E.
Hermance, Jr.*10.12
    
    
    Amended and Restated Employment Agreement between Hudson City Savings Bank and Ronald E.
Hermance, Jr.*10.13
    
    
    Amended and Restated Employment Agreement between Hudson City Bancorp, Inc. and Denis J.
Salamone*10.14
    
    
    Amended and Restated Employment Agreement between Hudson City Savings Bank and Denis J.
Salamone*10.15
    
    
    Executive Officer Annual Incentive Plan of Hudson City Savings Bank(9)10.16
    
    
    Amended and Restated Loan Agreement by and between Employee Stock Ownership Plan Trust of
Hudson City Savings Bank and Hudson City Bancorp, Inc.(9)10.17
    
    
    Amended and Restated Promissory Note between Employee Stock Ownership Plan Trust and Hudson
City Bancorp, Inc.(9)10.18
    
    
    Amended and Restated Pledge Agreement by and between Employee Stock Ownership Plan Trust of
Hudson City Savings Bank and Hudson City Bancorp, Inc.(9)10.19
    
    
    Form of Amended and Restated Assignment between Employee Stock Ownership Plan Trust and Hudson
City Bancorp, Inc.(9)10.20
    
    
    Loan Agreement by and between Employee Stock Ownership Plan Trust of Hudson City Savings Bank
and Hudson City Bancorp, Inc.(9)10.21
    
    
    Promissory Note between Employee Stock Ownership Plan Trust and Hudson City Bancorp, Inc.(9)10.22
    
    
    Pledge Agreement by and between Employee Stock Ownership Plan Trust of Hudson City Savings Bank
and Hudson City Bancorp, Inc.(9)10.23
    
    
    Form of Assignment between Employee Stock Ownership Plan Trust and Hudson City Bancorp, Inc.(9)10.24
    
    
    Hudson City Bancorp, Inc. 2006 Stock Incentive Plan(10)10.25
    
    
    Form of Hudson City Bancorp, Inc. 2006 Stock Incentive Plan Performance Stock Option Agreement(11)
 Page 144




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EXHIBIT
    
    DESCRIPTION10.26
    
    
    Form of Hudson City Bancorp, Inc. 2006 Stock Incentive Plan Retention Stock Option Agreement(11)10.27
    
    
    Form of Hudson City Bancorp, Inc. 2006 Stock Incentive Plan Director Stock Option Agreement(11)10.28
    
    
    Benefit Maintenance Plan of Hudson City Savings Bank*10.29
    
    
    Summary of Material Terms of Directed Charitable Contribution Program(11)10.30
    
    
    Summary of Director Compensation(11)10.31
    
    
    Directors Deferred Compensation Plan of Hudson City Bancorp, Inc.*10.32
    
    
    Officers Deferred Compensation Plan of Hudson City Bancorp, Inc.*21.1
    
    
    Subsidiaries of Hudson City Bancorp, Inc.*23.1
    
    
    Consent of KPMG LLP*31.1
    
    
    Certification of Disclosure of Ronald E. Hermance, Jr.*31.2
    
    
    Certification of Disclosure of James C. Kranz*32.1
    
    
    Statement Furnished Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C.
Section 1350*
 
 (1)
    
    Incorporated herein by reference to the Exhibits to the Registrants Registration Statement No. 333-122989 on
Form S-3 filed with the Securities and Exchange Commission on February 25, 2005, as amended.(2)
    
    Incorporated herein by reference to the Exhibits to the Registrants Current Report on Form 8-K filed with the
Securities and Exchange Commission on February 10, 2006.(3)
    
    Incorporated herein by reference to the Exhibits to the Registrants Registration Statement No. 333-74383 on
Form S-1, filed with the Securities and Exchange Commission on March 15, 1999, as amended.(4)
    
    Incorporated herein by reference to the Exhibits to the Registrants Quarterly Report on Form 10-Q for the quarter
ended June 30, 2007 filed with the Securities and Exchange Commission on August 8, 2007 and the Registrants Current
Report on Form 8-K filed with the Securities and Exchange Commission on December 29, 2008.(5)
    
    Incorporated herein by reference to the Exhibits to the Registrants Annual Report on Form 10-K for the fiscal year
ended December 31, 2004 filed with the Securities and Exchange Commission on February 25, 2005.(6)
    
    Incorporated herein by reference to the Exhibits to the Registrants Registration Statement No. 333-95193 on
Form S-8, filed with the Securities and Exchange Commission on January 21, 2000.(7)
    
    Incorporated herein by reference to the Exhibits to the Registrants Annual Report on Form 10-K for the fiscal year
ended December 31, 2001 filed with the Securities and Exchange Commission on March 28, 2002.(8)
    
    Incorporated herein by reference to the Exhibits to the Registrants Registration Statement No. 333-114536 on
Form S-8, filed with the Securities and Exchange Commission on April 16, 2004.(9)
    
    Incorporated herein by reference to the Exhibits to the Registrants Annual Report on Form 10-K for the fiscal year
ended December 31, 2005 filed with the Securities and Exchange Commission on March 16, 2006.(10)
    
    Incorporated herein by reference to the Proxy Statement No. 000-26001 filed with the Securities and Exchange
Commission on April 28, 2006.(11)
    
    Incorporated herein by reference to the Exhibits to the Registrants Annual Report on Form 10-K for the fiscal year
ended December 31, 2006 filed with the Securities and Exchange Commission on March 1, 2007.(12)
    
    Incorporated herein by reference to the Exhibits to the Registrants Quarterly Report on Form 10-Q for the quarter
ended June 30, 2007 filed with the Securities and Exchange Commission on August 8, 2007.(13)
    
    Incorporated herein by reference to the Exhibits to the Registrants Annual Report on Form 10-K for the fiscal year
ended December 31, 2007 filed with the Securities and Exchange Commission on February 29, 2008.(*) Filed herewith. Page 145




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##### Table of Contents



SIGNATURES
  Hudson City Bancorp, Inc.By:
    
    /s/ Ronald E. Hermance, Jr.
    
    
    
    /s/ James C. KranzRonald E. Hermance, Jr.
    
    
    
    James C. KranzChairman, President and
Chief Executive Officer
    
    
    
    Executive Vice President
and Chief Financial Officer(Principal Executive Officer)
    
    
    
    (Principal Financial Officer)
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NAME
    
    TITLE
    
    DATE/s/ Ronald E. Hermance, Jr.
    
    Director, Chairman, President and
    
    February 27, 2009Ronald E. Hermance, Jr.
    
    Chief Executive Officer
(Principal Executive Officer)/s/ Denis J. Salamone
    
    Director, Senior Executive Vice President and
    
    February 27, 2009Denis J. Salamone
    
    Chief Operating Officer/s/ Michael W. Azzara
    
    Director
    
    February 27, 2009Michael W. Azzara/s/ William G. Bardel
    
    Director
    
    February 27, 2009William G. Bardel/s/ Scott A. Belair
    
    Director
    
    February 27, 2009Scott A. Belair/s/ Victoria H. Bruni
    
    Director
    
    February 27, 2009Victoria H. Bruni/s/ William J. Cosgrove
    
    Director
    
    February 27, 2009William J. Cosgrove/s/ Donald O. Quest
    
    Director
    
    February 27, 2009Donald O. Quest/s/ Joseph G. Sponholz
    
    Director
    
    February 27, 2009Joseph G. Sponholz
 Page 147