M&T Bank Corporation ("M&T")
GAAP Results of Operations. Diluted earnings per share measured in accordance with generally accepted accounting principles ("GAAP") for the third quarter of 2006 were $1.85, 13% higher than $1.64 in the corresponding period of 2005. On the same basis, net income in the recent quarter totaled $210 million, up 10% from $191 million in the third quarter of 2005. GAAP-basis net income for 2006's third quarter expressed as an annualized rate of return on average assets and average common stockholders' equity was 1.49% and 13.72%, respectively, compared with 1.39% and 12.97%, respectively, in the year-earlier quarter.
M&T's third quarter 2006 results reflect the impact of the June 30, 2006 acquisition by M&T Bank of 21 branch offices in Buffalo and Rochester, New York from Citibank, N.A., including approximately $269 million in loans and $1.0 billion in deposits. Including the impact of the amortization of core deposit intangible resulting from the transaction and acquisition-related expenses, net income and diluted earnings per share in the recent quarter were reduced by approximately $5 million and $.04, respectively, as a result of the transaction.
The recent quarter's results also reflect certain other notable events that in total had no significant effect on net income. M&T recorded a $13 million gain resulting from the accelerated recognition of a purchase accounting premium related to the call of a $200 million Federal Home Loan Bank of Atlanta ("FHLB") borrowing assumed in a previous acquisition. After applicable taxes, that gain added $8 million to net income. Also reflected in the 2006 third quarter results was a $3 million reduction of income tax expense related to the favorable settlement of refund claims originally filed by Allfirst Financial Inc. prior to its acquisition by M&T on April 1, 2003. The refunds received, consisting of income taxes and taxable interest, exceeded the amounts previously accrued for such items by $5 million (pre-tax). Finally, an $18 million tax deductible contribution was made by M&T Bank, a wholly owned subsidiary of M&T, to The M&T Charitable Foundation, a tax exempt private charitable foundation, which increased "other expense" by the amount of the contribution and, after applicable tax effect, reduced net income by $11 million. As noted above, the aggregate impact of these events had no significant effect on M&T's net income or diluted earnings per share in the third quarter of 2006.
Last year's third quarter results reflected a $29 million non-cash, other-than-temporary impairment charge related to preferred stock issuances of the Federal National Mortgage Association ("FNMA") and the Federal Home Loan Mortgage Corporation ("FHLMC"). As a result of that impairment charge and the recognition of available income tax benefits, M&T's reported net income in 2005's third quarter was reduced by $18 million, or $.16 of diluted earnings per share.
Commenting on M&T's third quarter results, Rene F. Jones, Executive Vice President and Chief Financial Officer, noted, "Despite a less than desirable rate environment and modest loan growth, M&T posted strong results for the third quarter. Highlights of the quarter included the integration of 21 branches in upstate New York acquired at the end of the second quarter of 2006, a stable net interest margin, strong credit quality and continued success at managing operating expense levels."
Further commenting on M&T's operating expense levels, Mr. Jones noted, "Even after considering the incremental costs added to our recent quarter's expense totals associated with the acquired branches, M&T's operating expenses were held in check. In fact, after excluding the recent quarter's $18 million charitable contribution and mortgage impairment charges and recoveries, operating expenses in the third quarter decreased from the second quarter by over $4 million."
For the nine-month period ended September 30, 2006, GAAP-basis diluted earnings per share rose 11% to $5.49 from $4.95 in the similar period of 2005. On the same basis, net income for the first three quarters of 2006 totaled $626 million, up 8% from the $577 million earned in the corresponding 2005 period. GAAP-basis net income for the nine months ended September 30, 2006 expressed as an annualized rate of return on average assets and average common stockholders' equity was 1.51% and 14.01%, respectively, compared with 1.43% and 13.37%, respectively, in the similar nine-month period of 2005.
Supplemental Reporting of Non-GAAP Results of Operations. Since 1998, M&T has consistently provided supplemental reporting of its results on a "net operating" or "tangible" basis, from which M&T excludes the after-tax effect of amortization of core deposit and other intangible assets (and the related goodwill, core deposit intangible and other intangible asset balances, net of applicable deferred tax amounts) and expenses associated with merging acquired operations into M&T, because such expenses are considered by management to be "nonoperating" in nature. Although "net operating income" as defined by M&T is not a GAAP measure, M&T's management believes that this information helps investors understand the effect of acquisition activity in reported results. Amortization of core deposit and other intangible assets, after tax effect, totaled $12 million ($.10 per diluted share) in the recent quarter, compared with $9 million ($.08 per diluted share) in the third quarter of 2005. Similar amortization charges, after tax effect, for each of the nine-month periods ended September 30, 2006 and 2005 were $27 million or $.23 per diluted share. The after-tax effect of amortization of the core deposit intangible associated with the June 2006 branch acquisition was $5 million and of expenses related to the acquisition and integration of those branch offices was $1 million during the third quarter of 2006. Together, those items totaled $6 million, after tax effect, or $.05 per diluted share in the recent quarter. Acquisition and integration-related expenses totaled $3 million, after tax effect, or $.03 of diluted earnings per share, during the nine months ended September 30, 2006. There were no similar expenses in 2005.
Diluted net operating earnings per share, which exclude amortization of core deposit and other intangible assets and merger-related expenses, were $1.96 in the third quarter of 2006, 14% higher than $1.72 in the year-earlier quarter. Net operating income totaled $223 million and $200 million in the third quarter of 2006 and 2005, respectively. The second quarter branch acquisition was slightly accretive to the recent quarter's diluted net operating earnings per share. Expressed as an annualized rate of return on average tangible assets and average tangible stockholders' equity, net operating income was 1.67% and 30.22%, respectively, in 2006's third quarter, compared with 1.54% and 27.67% in the year-earlier quarter.
Diluted net operating earnings per share for the nine-month period ended September 30, 2006 increased 11% to $5.75 from $5.18 in the corresponding period of 2005. For the first nine months of 2006, net operating income totaled $656 million, 9% above $604 million in the year-earlier period. Expressed as an annualized rate of return on average tangible assets and average tangible equity, net operating income for the first three quarters of 2006 was 1.67% and 29.86%, respectively, compared with 1.59% and 29.04% in the first nine months of 2005.
Reconciliation of GAAP and Non-GAAP Results of Operations. A reconciliation of diluted earnings per share and net income with diluted net operating earnings per share and net operating income follows:
Three months ended Nine months ended
September 30 September 30
2006 2005 2006 2005
---- ---- ---- ----
(in thousands, except per share)
Diluted earnings per share $ 1.85 1.64 5.49 4.95
Amortization of core deposit
and other intangible assets(1) .10 .08 .23 .23
Merger-related expenses (1) .01 - .03 -
-------- ------- ------- -------
Diluted net operating earnings
per share $ 1.96 1.72 5.75 5.18
======== ======= ======= =======
Net income $210,370 191,074 625,860 577,198
Amortization of core deposit
and other intangible assets(1) 12,154 8,503 27,014 26,929
Merger-related expenses (1) 704 - 3,048 -
-------- ------- ------- -------
Net operating income $223,228 199,577 655,922 604,127
======== ======= ======= =======
(1) After any related tax effect
Reconciliation of Total Assets and Equity to Tangible Assets and Equity. A reconciliation of average assets and equity with average tangible assets and average tangible equity follows:
Three months ended Nine months ended
September 30 September 30
2006 2005 2006 2005
---- ---- ---- ----
(in millions)
Average assets $56,158 54,444 55,591 53,899
Goodwill (2,909) (2,904) (2,908) (2,904)
Core deposit and other
intangible assets (281) (128) (167) (142)
Deferred taxes 36 49 39 55
------- ------ ------ ------
Average tangible assets $53,004 51,461 52,555 50,908
======= ====== ====== ======
Average equity $ 6,085 5,845 5,973 5,772
Goodwill (2,909) (2,904) (2,908) (2,904)
Core deposit and other
intangible assets (281) (128) (167) (142)
Deferred taxes 36 49 39 55
------- ------ ------ ------
Average tangible equity $ 2,931 2,862 2,937 2,781
======= ====== ====== ======
Taxable-equivalent Net Interest Income. Taxable-equivalent net interest income was $462 million in the third quarter of 2006, up slightly from $460 million in the year-earlier quarter. Net interest margin, or taxable-equivalent net interest income expressed as an annualized percentage of average earning assets, was 3.68% in 2006's third quarter, compared with 3.76% in the corresponding period of 2005. Such decline reflects the continuing impact of higher short-term interest rates, which resulted in the rates paid on interest-bearing liabilities rising more rapidly than the yield on many earning assets. However, reflecting a more stable short-term interest rate environment in the recent quarter, the net interest margin in 2006's third quarter was 2 basis points (hundredths of one percent) higher than in 2006's second quarter. Largely offsetting the impact of a lower net interest margin in the recent quarter as compared with the year-earlier quarter was growth in average loans and leases, which aggregated $41.7 billion in 2006's third quarter, up 5% from $39.9 billion in the third quarter of 2005. Such growth was attributable to increases in average outstanding balances of 9% in commercial loans, 6% in commercial real estate loans and 18% in residential real estate loans, while average consumer loans declined 7% from the third quarter of 2005. The major factor in that decline was a drop in automobile loans and leases outstanding resulting from M&T's decision to allow such loans to decline rather than matching interest rates that M&T believes are inadequate, but that are being offered by competitors.
Provision for Credit Losses/Asset Quality. The provision for credit losses totaled $17 million in the recent quarter, down from $22 million in the third quarter of 2005. Net charge-offs of loans during the third quarter of 2006 and 2005 were also $17 million and $22 million, respectively. Expressed as an annualized percentage of average loans outstanding, net charge-offs were .16% in the recently completed quarter, compared with .21% in the corresponding 2005 period.
Loans classified as nonperforming totaled $180 million, or .43% of total loans at the recent quarter-end, up from $166 million or .41% at September 30, 2005 and $156 million at each of December 31, 2005 and June 30, 2006, or .39% and .38% of total loans at those respective dates. The increase from the prior periods was due to the recent quarter addition of approximately $26 million of loans related to a single automobile dealer relationship. Loans past due 90 days or more and accruing interest totaled $112 million at September 30, 2006, compared with $131 million a year earlier. Included in these past due but accruing amounts were loans guaranteed by government-related entities of $76 million and $107 million, respectively. Assets taken in foreclosure of defaulted loans were $14 million at September 30, 2006, compared with $9 million a year earlier.
Allowance for Credit Losses. The allowance for credit losses totaled $646 million, or 1.54% of total loans, at September 30, 2006, compared with $638 million, or 1.58%, a year earlier and at December 31, 2005. The ratio of M&T's allowance for credit losses to nonperforming loans was 360%, 383% and 408% at September 30, 2006, September 30, 2005 and December 31, 2005, respectively.
Noninterest Income and Expense. Noninterest income in the recent quarter totaled $274 million, up 24% from $221 million in the year-earlier quarter. The increase reflects the previously discussed $13 million gain recognized in the recent quarter from the accelerated recognition of a purchase accounting premium related to the call of an FHLB borrowing assumed in an acquisition and the $29 million non-cash accounting charge recognized during 2005's third quarter for the other-than-temporary decline in value of the preferred stock of FNMA and FHLMC.
Noninterest expense in the third quarter of 2006 totaled $409 million, compared with $368 million in 2005's third quarter. Included in such amounts are expenses considered to be nonoperating in nature consisting of amortization of core deposit and other intangible assets of $20 million in 2006 and $14 million in 2005 and merger-related expenses of $1 million in 2006. Exclusive of those nonoperating expenses, noninterest operating expenses were $388 million in the recent quarter, compared with $354 million in the third quarter of 2005. The higher operating expenses in the recent quarter reflect the $18 million charitable contribution made in the quarter and a $5 million addition to the valuation allowance for the impairment of capitalized mortgage servicing rights. The addition to the valuation allowance reflects a decrease in the value of capitalized mortgage servicing rights resulting from lower residential mortgage loan interest rates at September 30, 2006 as compared with a quarter earlier. A $6 million partial reversal of the valuation allowance for the impairment of capitalized mortgage servicing rights was recorded during the third quarter of 2005, largely the result of the higher interest rate environment that existed at the end of that quarter as compared with June 30, 2005.
The efficiency ratio, or noninterest operating expenses divided by the sum of taxable-equivalent net interest income and noninterest income (exclusive of gains and losses from bank investment securities), measures the relationship of operating expenses to revenues. M&T's efficiency ratio was 52.8% in the third quarter of 2006, compared with 50.0% in the year-earlier period. Were the $18 million charitable contribution and the $13 million gain on the called borrowing with the FHLB excluded from the computation, the efficiency ratio in the recent quarter would have been 51.2%.
Balance Sheet. M&T had total assets of $56.4 billion at September 30, 2006, up from $54.8 billion at September 30, 2005. Loans and leases, net of unearned discount, totaled $42.1 billion at September 30, 2006, compared with $40.3 billion a year earlier. Deposits aggregated $39.1 billion at the recent quarter-end, up from $37.2 billion at September 30, 2005. Total stockholders' equity was $6.2 billion at September 30, 2006, representing 10.91% of total assets, compared with $5.8 billion or 10.66% a year earlier. Common stockholders' equity per share was $55.58 and $51.81 at September 30, 2006 and 2005, respectively. Tangible equity per common share was $27.15 at September 30, 2006, compared with $25.42 at September 30, 2005. In the calculation of tangible equity per common share, stockholders' equity is reduced by the carrying values of goodwill and core deposit and other intangible assets, net of applicable deferred tax balances, which aggregated $3.1 billion and $3.0 billion at September 30, 2006 and 2005, respectively.
In November 2005, M&T announced that it had been authorized by its Board of Directors to purchase up to 5,000,000 shares of its common stock. During the recent quarter, 762,000 shares of common stock were repurchased by M&T pursuant to such plan at an average cost per share of $120.44. Through September 30, 2006, M&T had repurchased 2,681,400 shares of its common stock pursuant to such plan at an average cost of $113.31 per share.
Conference Call. Investors will have an opportunity to listen to M&T's conference call to discuss third quarter financial results today at 10:00 a.m. Eastern Daylight Saving Time. Those wishing to participate in the call may dial 877-780-2276. International participants, using any applicable international calling codes, may dial 973-582-2700. Callers should reference M&T Bank Corporation or conference ID #7900365.
The conference call will also be webcast live on M&T's website at http://ir.mandtbank.com/conference.cfm. A replay of the call will be available until Thursday, October 12, 2006 by calling 877-519-4471, or 973-341-3080 for international participants, and by making reference to ID #7900365. The event will also be archived and available by 3:00 p.m. today on M&T's website at http://ir.mandtbank.com/conference.cfm.
Forward-Looking Statements. This news release contains forward-looking statements that are based on current expectations, estimates and projections about M&T's business, management's beliefs and assumptions made by management. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions ("Future Factors") which are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements.
Future Factors include changes in interest rates, spreads on earning assets and interest-bearing liabilities, and interest rate sensitivity; prepayment speeds, loan originations and credit losses; sources of liquidity; common shares outstanding; common stock price volatility; fair value of and number of stock-based compensation awards to be issued in future periods; legislation affecting the financial services industry as a whole, and M&T and its subsidiaries individually or collectively; regulatory supervision and oversight, including monetary policy and required capital levels; changes in accounting policies or procedures as may be required by the Financial Accounting Standards Board or other regulatory agencies; increasing price and product/service competition by competitors, including new entrants; rapid technological developments and changes; the ability to continue to introduce competitive new products and services on a timely, cost-effective basis; the mix of products/services; containing costs and expenses; governmental and public policy changes; protection and validity of intellectual property rights; reliance on large customers; technological, implementation and cost/financial risks in large, multi-year contracts; the outcome of pending and future litigation and governmental proceedings; continued availability of financing; financial resources in the amounts, at the times and on the terms required to support M&T and its subsidiaries' future businesses; and material differences in the actual financial results of merger and acquisition activities compared with M&T's initial expectations, including the full realization of anticipated cost savings and revenue enhancements.
These are representative of the Future Factors that could affect the outcome of the forward-looking statements. In addition, such statements could be affected by general industry and market conditions and growth rates, general economic and political conditions, either nationally or in the states in which M&T and its subsidiaries do business, including interest rate and currency exchange rate fluctuations, changes and trends in the securities markets, and other Future Factors.
M&T BANK CORPORATION
Financial Highlights
Three months ended Nine months ended
September 30 September 30
------------------ ------------------
Amounts in thousands,
except per share 2006 2005 Change 2006 2005 Change
-------- ------- ------ -------- ------- ------
Performance
-----------
Net income $210,370 191,074 10% $625,860 577,198 8%
Per common share:
Basic earnings $1.89 1.68 13% $5.62 5.06 11%
Diluted earnings 1.85 1.64 13 5.49 4.95 11
Cash dividends $ .60 .45 33 $1.65 1.30 27
Common shares
outstanding:
Average
- diluted (1) 113,897 116,200 -2% 114,069 116,598 -2%
Period end (2) 110,678 112,848 -2 110,678 112,848 -2
Return on
(annualized):
Average total
assets 1.49% 1.39% 1.51% 1.43%
Average common
stockholders'
equity 13.72% 12.97% 14.01% 13.37%
Taxable-equivalent
net interest
income $462,356 459,553 1% $1,365,367 1,357,493 1%
Yield on average
earning assets 6.83% 5.94% 6.64% 5.72%
Cost of
interest-bearing
liabilities 3.77% 2.64% 3.54% 2.35%
Net interest spread 3.06% 3.30% 3.10% 3.37%
Contribution of
interest-free funds .62% .46% .59% .42%
Net interest margin 3.68% 3.76% 3.69% 3.79%
Net charge-offs to
average total net
loans (annualized) .16% .21% .14% .18%
Net operating
results (3)
-------------
Net operating
income $223,228 199,577 12% $ 655,922 604,127 9%
Diluted net
operating earnings
per common share 1.96 1.72 14 5.75 5.18 11
Return on
(annualized):
Average tangible
assets 1.67% 1.54% 1.67% 1.59%
Average tangible
common equity 30.22% 27.67% 29.86% 29.04%
Efficiency ratio 52.76% 49.97% 51.95% 51.38%
At September 30
-------------------------
Loan quality 2006 2005 Change
------------ -------- ------- ------
Nonaccrual loans $162,933 154,768 5%
Renegotiated loans 16,579 11,697 42
-------- -------
Total nonperforming loans $179,512 166,465 8%
======== =======
Accruing loans past due 90 days or
more $112,090 130,944 -14%
Nonperforming loans to total net loans .43% .41%
Allowance for credit losses to total
net loans 1.54% 1.58%
(1) Includes common stock equivalents.
(2) Includes common stock issuable under deferred compensation plans.
(3) Excludes amortization and balances related to goodwill and core
deposit and other intangible assets and merger-related expenses
which, except in the calculation of the efficiency ratio, are net of
applicable income tax effects. A reconciliation of net income and
net operating income is included herein.
M&T BANK CORPORATION
Condensed Consolidated Statement of Income
Three months ended Nine months ended
September 30 September 30
------------------ ---------------------
Dollars in thousands 2006 2005 Change 2006 2005 Change
-------- ------- ------ ---------- --------- -----
Interest income $852,836 720,754 18% $2,443,019 2,035,593 20%
Interest expense 395,652 265,576 49 1,092,196 690,858 58
-------- ------- ---------- ---------
Net interest income 457,184 455,178 - 1,350,823 1,344,735 -
Provision for
credit losses 17,000 22,000 -23 52,000 65,000 -20
-------- ------- ---------- ---------
Net interest income
after provision
for credit losses 440,184 433,178 2 1,298,823 1,279,735 1
Other income
Mortgage banking
revenues 36,806 35,345 4 112,882 100,045 13
Service charges on
deposit accounts 100,314 94,878 6 284,739 276,200 3
Trust income 35,224 33,748 4 103,777 100,016 4
Brokerage services
income 14,794 13,685 8 43,999 42,045 5
Trading account and
foreign exchange
gains 5,082 6,326 -20 17,756 17,152 4
Gain (loss) on bank
investment
securities 1,133 (27,995) - 1,427 (27,749) -
Other revenues from
operations 80,549 65,507 23 224,855 193,405 16
-------- ------- ---------- ---------
Total other
income 273,902 221,494 24 789,435 701,114 13
Other expense
Salaries and
employee benefits 218,980 207,705 5 660,224 618,922 7
Equipment and net
occupancy 41,683 43,033 -3 127,612 129,647 -2
Printing, postage
and supplies 8,294 8,684 -4 24,933 25,926 -4
Amortization of core
deposit and other
intangible assets 19,936 13,926 43 44,321 44,102 -
Other costs of
operations 120,048 94,902 26 310,851 297,431 5
-------- ------- ---------- ---------
Total other
expense 408,941 368,250 11 1,167,941 1,116,028 5
Income before
income taxes 305,145 286,422 7 920,317 864,821 6
Applicable income
taxes 94,775 95,348 -1 294,457 287,623 2
-------- ------- ---------- ---------
Net income $210,370 191,074 10% $ 625,860 577,198 8%
======== ======= ========== =========
M&T BANK CORPORATION
Condensed Consolidated Balance Sheet
September 30
------------------------
Dollars in thousands 2006 2005 Change
----------- ----------
ASSETS
Cash and due from banks $ 1,336,737 1,401,790 -5%
Interest-bearing deposits at banks 10,425 10,491 -1
Federal funds sold and agreements
to resell securities 123,245 20,690 496
Trading account assets 176,450 186,744 -6
Investment securities 7,626,300 8,230,447 -7
Loans and leases, net of unearned
discount 42,098,271 40,334,607 4
Less: allowance for credit losses 646,319 637,819 1
----------- ----------
Net loans and leases 41,451,952 39,696,788 4
Goodwill 2,908,849 2,904,081 -
Core deposit and other intangible
assets 270,910 121,405 123
Other assets 2,468,608 2,268,913 9
----------- ----------
Total assets $56,373,476 54,841,349 3%
=========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Noninterest-bearing deposits at U.S.
offices $ 7,754,061 8,067,788 -4%
Other deposits at U.S. offices 27,348,917 24,948,861 10
Deposits at foreign office 3,975,811 4,182,366 -5
----------- ----------
Total deposits 39,078,789 37,199,015 5
Short-term borrowings 4,418,356 4,198,206 5
Accrued interest and other
liabilities 1,001,600 742,442 35
Long-term borrowings 5,723,488 6,854,663 -17
----------- ----------
Total liabilities 50,222,233 48,994,326 3
Stockholders' equity (1) 6,151,243 5,847,023 5
----------- ----------
Total liabilities and stockholders'
equity $56,373,476 54,841,349 3%
=========== ==========
(1) Reflects accumulated other comprehensive loss, net of applicable
income tax effect, of $86.9 million at September 30, 2006 and
$45.3 million at September 30, 2005.
M&T BANK CORPORATION
Condensed Consolidated Average Balance Sheet
and Annualized Taxable-equivalent Rates
Three months ended
September 30
-------------------------------
Dollars in millions
2006 2005 Change in
------------ ------------
Balance Rate Balance Rate balance
------- ---- ------- ---- ------
ASSETS
Interest-bearing
deposits at banks $ 13 3.67% 11 1.77% 22%
Federal funds sold and
agreements to resell
securities 136 7.23 24 3.79 476
Trading account assets 92 2.97 94 2.16 -3
Investment securities 7,898 4.82 8,439 4.41 -6
Loans and leases, net
of unearned discount
Commercial,
financial, etc. 11,436 7.31 10,497 5.71 9
Real estate -
commercial 15,256 7.43 14,351 6.86 6
Real estate -
consumer 5,053 6.48 4,268 5.99 18
Consumer 9,965 7.29 10,763 6.25 -7
------ ------
Total loans
and leases, net 41,710 7.22 39,879 6.27 5
------ ------
Total earning
assets 49,849 6.83 48,447 5.94 3
Goodwill 2,909 2,904 -
Core deposit and
other intangible
assets 281 128 119
Other assets 3,119 2,965 5
------ ------
Total assets $56,158 54,444 3%
====== ======
LIABILITIES AND
STOCKHOLDERS' EQUITY
Interest-bearing
deposits
NOW accounts $ 434 .88 400 .60 8%
Savings deposits 14,463 1.42 14,822 1.00 -2
Time deposits 13,016 4.65 9,540 3.30 36
Deposits at
foreign office 3,674 5.21 4,005 3.42 -8
------ ------
Total
interest-
bearing
deposits 31,587 3.19 28,767 2.09 10
------ ------
Short-term borrowings 4,441 5.31 4,779 3.50 -7
Long-term borrowings 5,660 5.79 6,373 4.46 -11
------ ------
Total interest-
bearing liabilities 41,688 3.77 39,919 2.64 4
Noninterest-
bearing deposits 7,571 7,941 -5
Other liabilities 814 739 10
------ ------
Total liabilities 50,073 48,599 3
Stockholders' equity 6,085 5,845 4
------ ------
Total liabilities
and stockholders'
equity $56,158 54,444 3%
====== ======
Net interest
spread 3.06 3.30
Contribution
of interest-free
funds .62 .46
Net interest margin 3.68% 3.76%
M&T BANK CORPORATION
Condensed Consolidated Average Balance Sheet
and Annualized Taxable-equivalent Rates
Nine months ended
September 30
-------------------------------
Dollars in millions
2006 2005 Change in
------------ ------------
Balance Rate Balance Rate balance
------- ---- ------- ---- ------
ASSETS
Interest-bearing
deposits at banks $ 13 3.17% 10 1.48% 25%
Federal funds sold and
agreements to resell
securities 66 6.58 24 3.34 178
Trading account assets 97 2.89 74 1.63 31
Investment securities 8,197 4.78 8,535 4.37 -4
Loans and leases, net
of unearned discount
Commercial,
financial, etc. 11,250 7.01 10,360 5.43 9
Real estate -
commercial 14,962 7.24 14,315 6.44 5
Real estate -
consumer 4,839 6.32 3,672 5.98 32
Consumer 10,031 7.02 10,887 6.03 -8
------ ------
Total loans
and leases, net 41,082 7.03 39,234 6.02 5
------ ------
Total earning
assets 49,455 6.64 47,877 5.72 3
Goodwill 2,908 2,904 -
Core deposit and
other intangible
assets 167 142 17
Other assets 3,061 2,976 3
------ ------
Total assets $55,591 53,899 3%
====== ======
LIABILITIES AND
STOCKHOLDERS'EQUITY
Interest-bearing
deposits
NOW accounts $ 427 .75 393 .50 9%
Savings deposits 14,351 1.33 15,021 .88 -4
Time deposits 12,532 4.37 8,531 3.01 47
Deposits at
foreign office 3,553 4.85 4,018 2.93 -12
------ ------
Total
interest-
bearing
deposits 30,863 2.96 27,963 1.82 10
------ ------
Short-term borrowings 4,441 4.93 4,979 2.98 -11
Long-term borrowings 5,959 5.49 6,346 4.21 -6
------ ------
Total interest-
bearing liabilities 41,263 3.54 39,288 2.35 5
Noninterest-
bearing deposits 7,530 8,121 -7
Other liabilities 825 718 15
------ ------
Total liabilities 49,618 48,127 3
Stockholders' equity 5,973 5,772 3
------ ------
Total liabilities
and stockholders'
equity $55,591 53,899 3%
====== ======
Net interest
spread 3.10 3.37
Contribution
of interest-free
funds .59 .42
Net interest margin 3.69% 3.79%
Media Contact:
C. Michael Zabel
(716) 842-5385
Investor Contact:
Donald J. MacLeod
(716) 842-5138
Web site: http://www.mandtbank.com/