TheStreet.com Staff
Hudson City has been successful because of the geographic area the company operates in. "Of the 202,000 new foreclosures in November, 70% [were] in Florida," he said. "If you look at foreclosures in New York, New Jersey and Connecticut, [they] were down."
The average down payment by Hudson City's customers was exceptionally high, at 41%. "No one is going to walk away from a home if they have put down 40%," said Cramer. Hudson City operates much more efficiently compared with its competitors, said Hermance. Other banks spend 55 cents of a dollar on overhead costs while Hudson City spends 25 cents. The higher efficiency allows the company to give its customers better deposit rates and better rates on its mortgages, Hermance said. "The in-born efficiency is not something you can create now," he said. "It has to have occurred 20 to 25 years ago, with getting the right kind of lease, employees, pensions, everything. You have to make that kind of investment years ahead of time." Hudson City is willing to expand, but only in areas with the right demographics: high income and good real estate." "The Washington area is crying for something like this," said Hermance. Cramer awarded the George Bailey award, named after the fictional character in the movie, It's a Wonderful life, to Hermance.
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