Each depositor insured to at least $250,000 per insured bank

Board of Directors
Hudson City Savings Bank
West 80 Century Road
Paramus, New Jersey 07652

Board of Directors:

The notice of intent to convert from mutual to stock form and related application for approval of a merger transaction, filed on behalf of Hudson City Savings Bank, Paramus, New Jersey ("Hudson"), have been reviewed by the Federal Deposit Insurance Corporation ("FDIC") pursuant to section 303.161 of the FDIC Rules and Regulations and Section 18(c) of the Federal Deposit Insurance Act.

These filings were made in connection with the "Hudson City Savings Bank Plan of Reorganization from a Mutual Savings Bank to a Mutual Holding Company and Stock Issuance Plan" (the "Plan"). Pursuant to the Plan, Hudson will: (i) merge with an interim stock savings bank that will succeed to all the rights and obligations of Hudson; (ii) establish a mid-tier Delaware stock holding company, Hudson City Bancorp, Inc. ("HBI") which will own 100 percent of the common stock of the stock savings bank; and (iii) establish a New Jersey mutual holding company, Hudson City, MHC ("MHC") which will own at least 51 percent of the common stock of HBI. Concurrently, with the reorganization, HBI intends to offer for sale up to 49 percent of its common stock on a priority basis to eligible account holders with qualifying deposits, tax-qualified employee benefit plans, and supplemental eligible account holders.

The FDIC has relied on information provided in Hudson's notice of conversion and the accompanying business plan in reaching its decision regarding that notice. Management of the Hudson and HBI have represented that for three years after the closing of the conversion, the FDIC will be given 30 days prior written notice before implementing any material deviation from the business plan, such as a return of capital. Management has further represented that neither Hudson nor HBI will award a return of capital during the first year following the Bank's conversion to stock form. Management is reminded that payment of regular or special dividends by HBI must be made from the earnings of HBI; any distribution to HBI shareholders in excess of HBI's earnings would be considered a return of capital.

Based on the information and representations presented, the FDIC plans to issue a letter of non-objection to the proposed conversion transaction provided that the bank satisfies the following conditions:

(1) Hudson must provide written evidence that its Plan of conversion has been approved by the affirmative vote of a majority of the votes eligible to be cast at a special meeting of the Bank's voting participants;

(2) Hudson must advise this office of the results of the subscription offering and deliver an updated appraisal that;

(a) takes the results of the subscription offering into account;

(b) discusses any material occurrences during the subscription period; and

(c) explains any orders that may have been rejected;

(3) Hudson must receive final approval from the appropriate State of New Jersey officials for its establishment as a stock savings bank. The mutual holding company and the mid-tier stock holding company must receive final approval from the appropriate Federal Reserve officials for the establishment of the bank holding companies; and

(4) Hudson will cast votes for trustee or custodian accounts, in the cases where no proxy card is returned, in the same ratio as all other votes cast in the adoption of the plan of reorganization.

Provided Hudson meets the foregoing conditions and that the FDIC is satisfied with the appraiser's determination in the updated appraisal that the results of the subscription offering represent fair value for Hudson, the FDIC will issue a letter of non-objection to the proposed conversion transaction.

Enclosed is the FDIC's Order and Basis for the merger application filed on behalf of Hudson in connection with the conversion transaction. Please furnish the FDIC's New York Regional Office with satisfactory evidence of Hudson's compliance with the conditions stated in the Order, and notify that office in writing when the proposed transaction has been consummated. If an extension of the time limitation included in the Order is necessary, please submit to the New York Regional Office a letter requesting a specific extension of the limitation, including the reasons for the requested extension.

Sincerely,

James L. Sexton
Director

FEDERAL DEPOSIT INSURANCE CORPORATION

Hudson City Savings Bank
Paramus, Bergen County, New Jersey
Application for Consent to Merge To facilitate a conversion from a Mutual Savings Bank to a Stock Savings Bank

ORDER AND BASIS FOR CORPORATION APPROVAL

These filings were made in connection with the "Hudson City Savings Bank Plan of Reorganization from a Mutual Savings Bank to a Mutual Holding Company and Stock Issuance Plan" (the "Plan"). Pursuant to the Plan, Hudson will: (i) merge with an interim stock savings bank that will succeed to all the rights and obligations of Hudson; (ii) establish a mid-tier Delaware stock holding company, Hudson City Bancorp, Inc. ("HBI") which will own 100 percent of the common stock of the stock savings bank; and (iii) establish a New Jersey mutual holding company, Hudson City, MHC ("MHC") which will own at least 51 percent of the common stock of HBI. Concurrently, with the reorganization, HBI intends to offer for sale up to 49 percent of its common stock on a priority basis to eligible account holders with qualifying deposits, tax-qualified employee benefit plans, and supplemental eligible account holders. The proposed transaction per se will not alter the competitive structure of banking in the market currently served by Hudson. Hudson's principal office will remain at West 80 Century Road, Paramus, New Jersey. Notice of the proposed transaction, in a form approved by the FDIC, has been published pursuant to the FDI Act.

A review of available information, including the Community Reinvestment Act ("CRA") Statement of Hudson discloses no inconsistencies with the purposes of the CRA. The bank is expected to continue to meet the credit needs of its entire community, consistent with safe and sound operation of the institution.

In connection with the application the FDIC has taken into consideration the financial and managerial resources and future prospects of the resultant Bank, and the convenience and needs of the community to be served. Having found favorably on these statutory factors and having considered other relevant information, including any reports on the competitive factors furnished by the Comptroller of the Currency, the Board of Governors of the Federal Reserve System, the Office of Thrift Supervision, or the Attorney General of the United States, it is the FDIC's judgement that the application should be and hereby is approved, subject to the following conditions:

(1) The proposed transaction may not be consummated unless the Plan receives prior approval by an affirmative vote of a majority of the votes eligible to be cast at a special meeting of Hudson's voting participants;

(2) That the proposed transaction may not be consummated unless and until the FDIC issues a nonobjection letter to the Notice filed on behalf of the applicant pursuant to section 303.161 of the FDIC's Rules and Regulations concerning the mutual-to-stock conversion portion of this transaction;

(3) The proposed transaction may not be consummated unless and until the resultant Bank has authority to conduct a banking business, and that its establishment and operation as a stock savings bank have been fully approved by the New Jersey State Banking Department, and that the applications by the mutual holding company and the mid-tier stock holding company to become bank holding companies are approved by the Board of Governors of the Federal Reserve System;

(4) That any changes in proposed management, including the board of directors or proposed ownership (10 percent or more of the stock and new acquisitions of or subscriptions to 10 percent or more of the stock), will render this approval null and void unless such proposal is approved by the Regional Director (Supervision) of the FDIC's New York Regional Office prior to the consummation of the proposed transaction;

(5) The transaction being consummated not less than fifteen calendar days after the date of this Order or later than six months after the date of the Order, unless such period is extended for good cause by the FDIC;

(6) That prior to a sale, transfer, or disposition of any shares of HBI by the MHC to any person (including any Employee Stock Ownership Plan), or a conversion of the mutual holding company to stock form, MHC will provide written notification to the FDIC and provide the FDIC with copies of all documents filed with state and federal banking and/or securities regulators in connection with any such sale, transfer, disposition, or conversion;

(7) That, should any shares of the stock of HBI or the Stock Bank be issued to persons other than MHC, any dividends waived by MHC must be retained by HBI or the Stock Bank and segregated, earmarked, or otherwise identified on the books and records of HBI or the Stock Bank; such amounts must be taken into account in any valuation of the institution and factored into the calculation used in establishing a fair and reasonable basis for exchanging shares in any subsequent conversion of MHC to stock form; such amounts shall not be available for payment to or the value thereof transferred to minority shareholders, by means including through dividend payments or at liquidation;

(8) Until the proposed transaction is consummated, the FDIC has the right to alter, suspend, or withdraw its approval should any interim development be deemed to warrant such action.

By Order of the Director of the Division of Supervision pursuant to the delegated authority of the Board of Directors.

Dated at Washington, D.C., this day of May, 1999.

____________________________
James L. Sexton
Director