Hudson City Bancorp, Inc. (NASDAQ:HCBK) saw its stock fall amid concerns that regulatory scrutiny could derail its merger, with M&T Bank Corporation (NYSE:MTB). The share of Hudson City fell by as much as 7.2% in before closing 5.8% in the negative at $9.89 per share. M&T’s shares fell 2.3% at $124.33 per share.

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M&T stated that Federal Reserve has notified it of the inability to complete the review of the proposed merger by April 30, the deadline for the deal. However, M&T stated its commitment to the merger.

Hudson City in a separate statement stated that it needed time to review the matter.

According to Bob Ramsey, an analyst at FBR Capital Markets, the deal will benefit both the companies. He however raised doubts whether the deal will go through or not.

The merger between the two banks would be the largest ever in U.S; however, it has repeatedly been stalled since 2012 due to regulatory concerns. The Federal Reserve has not given its assent to the deal as it reviews the money laundering controls of M&T. The deal, if goes ahead will be worth $3.7 billion.

According to Morgan Stanley, without the deal Hudson City’s share would be worth $3 per share, a decline of more than 70%. At the same time, M&T’s 2016 earnings per share would decline 11% from previous estimates of $8.77. Morgan Stanley also added that New York Community Bancorp Inc. might be interested in buying Hudson City is the deal doesn’t go through.

Both banks had taken steps to prepare for the completion of the deal like notifying stockholders and suspension of elections. Now that the deal is unlikely to happen by the deadline, either bank can terminate the transaction of it after the deadline.

M&T had spent millions to improve compliance and risk management controls amid Fed’s probe. Hudson City Bancorp, Inc. (NASDAQ:HCBK) made its efforts to expand business

The long-pending deal has made other lenders wary of bank acquisitions, and that may have an effect on the market.