Jim Cramer's 'Stop Trading!': Buy Hudson City

Buy Hudson City Bancorp (HCBK Quote), Jim Cramer said on CNBC's "Stop Trading!" segment Tuesday.

Cramer had previously given Hudson City CEO Ronald Hermance a "Mad Money" award for outstanding banking. "He was the only bank that was making money in the country," Cramer explained. He said Hudson City's banking practices stand in sharp contrast to those of National City (NCC Quote), which has had to raise $7 billion in equity thanks to the declining housing market. Hermance joined Cramer on "Stop Trading!" to explain his company's success.

Hermance said his bank has a record backlog in mortgage applications. Many borrowers, he said, are trying to refinance and couldn't go to other banks. He said that the "tremendous" mortgage applications are accompanied by "tremendous" deposit flow.

Cramer told Hermance he was "too humble." He said, "There's a lot of banks that dropped out of this business. They're afraid." He asked Hermance whether he believed that Fannie Mae (FNM Quote) and Freddie Mac (FRE Quote) will have to "take one for the team," and take on a number of bad loans. ...