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 2007 were $1.83, compared with $1.85 in the similar period of 2006. On the same basis, net income in the recent quarter totaled $199 million, compared with $210 million in the third quarter of 2006. GAAP-basis net income for the third quarter of 2007 expressed as an annualized rate of return on average assets and average common stockholders' equity was 1.37% and 12.78%, respectively, compared with 1.49% and 13.72%, respectively, in the corresponding 2006 quarter.
The recent quarter's results include an increase in the provision for credit losses reflecting, in part, higher net charge-offs and nonperforming loans. In addition, M&T's February 2007 investment in Bayview Lending Group, LLC ("BLG") resulted in a reduction of net income of $9 million (after tax effect), or $.09 per diluted share, inclusive of interest expense to fund the investment. BLG's results were impacted by the timing of the recognition of gains from loan sales and securitizations. Rene F. Jones, Executive Vice President and Chief Financial Officer of M&T, observed, "Higher credit costs, slow revenue growth and the impact of our investment in BLG hindered M&T's performance in the recent quarter. We were, however, encouraged with loan growth of more than $1 billion experienced late in the quarter and our continued ability to effectively manage operating expenses."
For the nine-month period ended September 30, 2007, GAAP-basis diluted earnings per share totaled $5.34, compared with $5.49 in the year-earlier period. On the same basis, net income for the first three quarters of 2007 was $589 million. In the year earlier period net income was $626 million. GAAP-basis net income for the nine months ended September 30, 2007 expressed as an annualized rate of return on average assets and average common stockholders' equity was 1.37% and 12.69%, respectively, compared with 1.51% and 14.01%, respectively, in the corresponding nine-month period of 2006.
Supplemental Reporting of Non-GAAP Results of Operations. M&T consistently provides 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, since 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 $10 million ($.09 per diluted share) in the recent quarter, compared with $12 million ($.10 per diluted share) in the third quarter of 2006. Similar amortization charges, after tax effect, for the nine-month periods ended September 30, 2007 and 2006 were $31 million or $.28 per diluted share and $27 million or $.23 per diluted share, respectively. The after-tax effect of expenses related to the acquisition and integration of branch offices acquired on June 30, 2006 were $1 million during the third quarter of 2006. Such 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 2007.
Diluted net operating earnings per share, which exclude amortization of core deposit and other intangible assets and merger-related expenses, were $1.92 in the third quarter of 2007, compared with $1.96 in the year-earlier quarter. Net operating income totaled $209 million and $223 million in the third quarter of 2007 and 2006, respectively. Expressed as an annualized rate of return on average tangible assets and average tangible stockholders' equity, net operating income was 1.51% and 26.80%, respectively, in 2007's third quarter, compared with 1.67% and 30.22% in the year-earlier quarter.
Diluted net operating earnings per share for the nine-month period ended September 30, 2007 aggregated $5.62, compared with $5.75 in the corresponding period of 2006. Net operating income totaled $620 million for the first nine months of 2007 and $656 million in the similar 2006 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 2007 was 1.52% and 26.74%, respectively, compared with 1.67% and 29.86% in the first nine months of 2006.
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
2007 2006 2007 2006
---- ---- ---- ----
(in thousands, except per share)
Diluted earnings per share $ 1.83 1.85 5.34 5.49
Amortization of core deposit
and other intangible assets(1) .09 .10 .28 .23
Merger-related expenses (1) - .01 - .03
-------- ------- ------- -------
Diluted net operating earnings
per share $ 1.92 1.96 5.62 5.75
======== ======= ======= =======
Net income $199,187 210,370 589,329 625,860
Amortization of core deposit
and other intangible assets(1) 9,562 12,154 30,772 27,014
Merger-related expenses (1) - 704 - 3,048
-------- ------- ------- -------
Net operating income $208,749 223,228 620,101 655,922
======== ======= ======= =======
(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
2007 2006 2007 2006
---- ---- ---- ----
(in millions)
Average assets $57,862 56,158 57,533 55,591
Goodwill (2,909) (2,909) (2,909) (2,908)
Core deposit and other
intangible assets (208) (281) (224) (167)
Deferred taxes 21 36 24 39
------- ------- ------ ------
Average tangible assets $54,766 53,004 54,424 52,555
======= ======= ====== ======
Average equity $ 6,186 6,085 6,209 5,973
Goodwill (2,909) (2,909) (2,909) (2,908)
Core deposit and other
intangible assets (208) (281) (224) (167)
Deferred taxes 21 36 24 39
------- ------- ------ ------
Average tangible equity $ 3,090 2,931 3,100 2,937
======= ======= ====== ======
Taxable-equivalent Net Interest Income. Taxable-equivalent net interest income was $473 million in the third quarter of 2007, up 2% from $462 million in the year-earlier quarter. Growth in average loans and leases, which increased 5% to $43.8 billion in 2007's third quarter from $41.7 billion in the third quarter of 2006, was the largest contributor to the rise. Such growth was largely attributable to increases in average outstanding balances of $803 million or 7% in commercial loans and $862 million or 17% in residential real estate loans. The positive impact of that growth on taxable- equivalent net interest income was offset by a year-over-year decline in the net interest margin, or taxable-equivalent net interest income expressed as an annualized percentage of average earning assets, of 3 basis points (hundredths of one percent). The net interest margin was 3.65% in 2007's third quarter and 3.68% in the corresponding period of 2006. The net interest margin was 3.67% in the second quarter of 2007.
Provision for Credit Losses/Asset Quality. Reflecting current credit conditions that have contributed to higher net charge-offs, delinquencies and nonperforming loans at M&T and throughout the banking industry, M&T's provision for credit losses increased to $34 million in the recent quarter from $17 million in the third quarter of 2006.
Net charge-offs of loans during the third quarter of 2007 and 2006 were $22 million and $17 million, respectively. Expressed as an annualized percentage of average loans outstanding, net charge-offs were .20% in the recently completed quarter, compared with .16% in the corresponding 2006 period. Loans classified as nonperforming totaled $371 million, or .83% of total loans at the recent quarter-end, up from $180 million or .43% at September 30, 2006, $224 million or .52% at December 31, 2006 and $296 million or .68% of total loans at June 30, 2007. The increase from June 30, 2007 reflects additional loans to residential home builders and developers of approximately $42 million and a $26 million increase in residential real estate loans classified as nonperforming. The higher level of nonperforming residential real estate loans substantially resulted from delinquencies in the portfolio of alternative ("Alt-A") residential mortgage loans transferred to M&T's held-for-investment loan portfolio in March 2007. Loans past due 90 days or more and accruing interest totaled $140 million at September 30, 2007, compared with $112 million a year earlier. Included in these past due but accruing amounts were loans guaranteed by government-related entities of $70 million and $76 million, respectively. Assets taken in foreclosure of defaulted loans were $22 million at September 30, 2007, up from $14 million a year earlier.
Allowance for Credit Losses. The allowance for credit losses totaled $680 million, or 1.52% of total loans, at September 30, 2007, compared with $646 million, or 1.54%, a year earlier and $650 million or 1.51% at December 31, 2006. The ratio of M&T's allowance for credit losses to nonperforming loans was 183%, 360% and 290% at September 30, 2007, September 30, 2006 and December 31, 2006, respectively.
Noninterest Income and Expense. Noninterest income in the third quarter of 2007 aggregated $253 million, down 8% from $274 million in the year-earlier quarter. The recent quarter's total includes M&T's pro-rata portion of the operating loss of BLG of $11 million while last year's third quarter reflects the impact of a $13 million gain from the accelerated recognition of a purchase accounting premium related to the call of an FHLB borrowing assumed in an acquisition. If the BLG operating results and the prior year gain are excluded, noninterest income increased to $264 million in the third quarter of 2007 from $261 million in the year-earlier period, despite a $5 million decrease in revenues from mortgage banking activities.
As already noted, M&T's investment in BLG reduced M&T's net income in the third quarter of 2007 by approximately $9 million (after tax effect), or $.09 per diluted share. The BLG investment added $8 million to noninterest income and approximately $2 million (after tax effect), or $.02 per diluted share, to M&T's net income in the second quarter of 2007. Results from M&T's investment in BLG fluctuate from quarter to quarter depending on the timing of loan sales/securitizations conducted by BLG. Through September 30, 2007, M&T's pro-rata portion of the operating results of BLG reduced noninterest income by $6 million and, including expenses associated with the investment, reduced net income by approximately $10 million, or $.09 per diluted share.
Noninterest expense in the third quarter of 2007 totaled $391 million, compared with $409 million in the third quarter of 2006. Included in such amounts are expenses considered to be nonoperating in nature consisting of amortization of core deposit and other intangible assets of $16 million in 2007 and $20 million in 2006 and acquisition-related expenses of $1 million in 2006 related to M&T's June 30, 2006 transaction to acquire 21 banking offices in Western New York. Exclusive of those nonoperating expenses, noninterest operating expenses were $375 million in the recent quarter, compared with $388 million in the third quarter of 2006. Operating expenses in the third quarter of 2006 reflected an $18 million charitable contribution made by M&T Bank, M&T's principal banking subsidiary, to The M&T Charitable Foundation, a tax exempt private charitable foundation, and a $5 million addition to the valuation allowance for the impairment of capitalized mortgage servicing rights. There were no similar expenses in the third quarter of 2007.
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 51.6% in the third quarter of 2007, compared with 52.8% in the year-earlier period.
Balance Sheet. M&T had total assets of $60.0 billion at September 30, 2007, up from $56.4 billion at September 30, 2006. Loans and leases, net of unearned discount, rose 6% to $44.8 billion at September 30, 2007 from $42.1 billion a year earlier. Deposits aggregated $38.5 billion at the recent quarter-end, compared with $39.1 billion at September 30, 2006. Total stockholders' equity was $6.2 billion at each of September 30, 2007 and 2006, representing 10.40% and 10.91%, respectively, of total assets. Common stockholders' equity per share was $58.40 and $55.58 at September 30, 2007 and 2006, respectively. Tangible equity per common share was $29.48 at September 30, 2007, compared with $27.15 at September 30, 2006. 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 at each of September 30, 2007 and 2006.
During the recent quarter, M&T repurchased 675,000 shares of common stock at an average cost per share of $105.28 under a plan authorized in February 2007 by M&T's Board of Directors allowing for the purchase of up to 5,000,000 shares of common stock. During the nine months ended September 30, 2007 M&T repurchased 4,389,800 shares of its common stock pursuant to authorized repurchase plans at an average cost of $113.00 per share.
As previously announced, M&T has entered into a definitive agreement with Partners Trust Financial Group, Inc. ("Partners Trust"), Utica, New York, providing for a merger between the two companies. As of June 30, 2007, Partners Trust had approximately $3.7 billion of assets, including $2.3 billion of loans, and $3.2 billion of liabilities, including $2.3 billion of deposits. The merger is subject to a number of conditions, including the approval of various state and Federal regulators and Partners Trust's stockholders, and is expected to be completed in the fourth quarter of 2007. In addition, in September 2007 M&T Bank announced that it had entered into a definitive agreement with First Horizon National Corp. ("First Horizon") to acquire First Horizon's 13-branch Mid-Atlantic franchise. Ten of the branches are located in the Greater Washington region and three are in the Greater Baltimore area. M&T Bank will acquire approximately $226 million in loans, $201 million in deposits and $136 million in trust and investment assets under management. The transaction is subject to various regulatory approvals and is expected to close in either the fourth quarter of 2007 or the first quarter of 2008.
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 #9287947. 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 Friday, October 12, 2007 by calling 877-519-4471, or 973-341-3080 for international participants, and by making reference to ID #9287947. 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.
M&T is a bank holding company whose banking subsidiaries, M&T Bank and M&T Bank, National Association, operate branch offices in New York, Pennsylvania, Maryland, Virginia, West Virginia, Delaware, New Jersey and the District of Columbia.
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, credit losses and market values on loans and other assets; 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, including tax legislation; 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, acquisition and investment 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.
Additional Information about the M&T/Partners Trust Transaction:
In connection with the proposed merger, M&T has filed with the SEC a Registration Statement on Form S-4 that includes a preliminary version of a Proxy Statement of Partners Trust and a preliminary Prospectus of M&T, as well as other relevant documents concerning the proposed transaction. The S-4 has not yet become effective. Following the S-4 being declared effective by the SEC, Partners Trust intends to mail the final Proxy Statement to its shareholders. Such final documents, however, are not currently available. Stockholders are urged to read the Registration Statement and the final Proxy Statement/Prospectus regarding the merger when it becomes available and any other relevant documents filed with the SEC or incorporated by reference in the final Proxy Statement/Prospectus, if and when they become available, because they will contain important information. You will be able to obtain a free copy of the final Proxy Statement/Prospectus, as well as other filings containing information about M&T and Partners Trust at the SEC's Internet site (http://www.sec.gov/). You will also be able to obtain these documents, free of charge, at http://www.mandtbank.com/ under the tab "About Us" and then under the heading "Investor Relations" and then under "SEC Filings." Copies of the final Proxy Statement/Prospectus and the SEC filings that will be incorporated by reference in the final Proxy Statement/Prospectus can also be obtained, free of charge, by directing a request to Investor Relations, One M&T Plaza, Buffalo, New York 14203, (716) 842-5138.
M&T and Partners Trust and their respective directors and executive officers may be deemed to be participants in the solicitation of proxies from the stockholders of Partners Trust in connection with the proposed merger. Information about the directors and executive officers of M&T is set forth in the proxy statement for M&T's 2007 annual meeting of stockholders, as filed with the SEC on a Schedule 14A on March 5, 2007. Information about the directors and executive officers of Partners Trust is set forth in the proxy statement for Partners Trust's 2007 annual meeting of stockholders, as filed with the SEC on a Schedule 14A on March 23, 2007. Additional information regarding the interests of those participants and other persons who may be deemed participants in the transaction may be obtained by reading the final Proxy Statement/Prospectus regarding the proposed merger when it becomes available. You may obtain free copies of this document as described in the preceding paragraph.
INVESTOR CONTACT: Donald J. MacLeod
(716) 842-5138
MEDIA CONTACT: C. Michael Zabel
(716) 842-5385
M&T BANK CORPORATION
Financial Highlights
Three months ended
September 30
Amounts in thousands, -----------------
except per share 2007 2006 Change
---- ---- ------
Performance
-----------
Net income $199,187 210,370 -5 %
Per common share:
Basic earnings $ 1.86 1.89 -2 %
Diluted earnings 1.83 1.85 -1
Cash dividends $ .70 .60 17
Common shares outstanding:
Average - diluted (1) 108,957 113,897 -4 %
Period end (2) 106,807 110,678 -3
Return on (annualized):
Average total assets 1.37 % 1.49 %
Average common stockholders' equity 12.78 % 13.72 %
Taxable-equivalent net interest
income $472,800 462,356 2 %
Yield on average earning assets 6.94 % 6.83 %
Cost of interest-bearing liabilities 3.88 % 3.77 %
Net interest spread 3.06 % 3.06%
Contribution of interest-free funds .59 % .62 %
Net interest margin 3.65 % 3.68%
Net charge-offs to average total
net loans (annualized) .20 % .16 %
Net operating results (3)
-------------------------
Net operating income $208,749 223,228 -6 %
Diluted net operating earnings per
common share 1.92 1.96 -2
Return on (annualized):
Average tangible assets 1.51 % 1.67 %
Average tangible common equity 26.80 % 30.22 %
Efficiency ratio 51.64 % 52.76 %
Nine months ended
September 30
Amounts in thousands, -----------------
except per share 2007 2006 Change
---- ---- ------
Performance
-----------
Net income $ 589,329 625,860 -6 %
Per common share:
Basic earnings $ 5.45 5.62 -3 %
Diluted earnings 5.34 5.49 -3
Cash dividends $ 1.90 1.65 15
Common shares outstanding:
Average - diluted (1) 110,342 114,069 -3 %
Period end (2) 106,807 110,678 -3
Return on (annualized):
Average total assets 1.37 % 1.51 %
Average common stockholders' equity 12.69 % 14.01 %
Taxable-equivalent net interest
income $1,395,234 1,365,367 2 %
Yield on average earning assets 6.94 % 6.64 %
Cost of interest-bearing liabilities 3.88 % 3.54 %
Net interest spread 3.06 % 3.10 %
Contribution of interest-free funds .60 % .59 %
Net interest margin 3.66 % 3.69 %
Net charge-offs to average total
net loans (annualized) .19 % .14 %
Net operating results (3)
-------------------------
Net operating income $ 620,101 655,922 -5 %
Diluted net operating earnings per
common share 5.62 5.75 -2
Return on (annualized):
Average tangible assets 1.52 % 1.67 %
Average tangible common equity 26.74 % 29.86 %
Efficiency ratio 52.24 % 51.95 %
At September 30
-----------------
Loan quality 2007 2006 Change
------------ ---- ---- ------
Nonaccrual loans $356,438 162,933 119 %
Renegotiated loans 14,953 16,579 -10
-------- -------
Total nonperforming loans $371,391 179,512 107 %
======== =======
Accruing loans past due
90 days or more $140,313 112,090 25 %
Nonperforming loans to
total net loans .83 % .43 %
Allowance for credit losses to total
net loans 1.52 % 1.54 %
-------------------------------------------------------------------------
(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
September 30
--------------------
Dollars in thousands 2007 2006 Change
-------- -------- ------
Interest income $893,014 852,836 5 %
Interest expense 425,326 395,652 8
-------- --------
Net interest income 467,688 457,184 2
Provision for credit losses 34,000 17,000 100
-------- --------
Net interest income after
provision for credit losses 433,688 440,184 -1
Other income
Mortgage banking revenues 31,643 36,806 -14
Service charges on deposit
accounts 104,402 100,314 4
Trust income 38,168 35,224 8
Brokerage services income 14,978 14,794 1
Trading account and foreign
exchange gains 7,279 5,082 43
Gain (loss) on bank investment
securities (138) 1,133 -
Equity in earnings of Bayview
Lending Group, LLC (11,294) - -
Other revenues from operations 67,861 80,549 -16
-------- --------
Total other income 252,899 273,902 -8
Other expense
Salaries and employee benefits 220,750 218,980 1
Equipment and net occupancy 42,091 41,683 1
Printing, postage and supplies 7,996 8,294 -4
Amortization of core deposit and
other intangible assets 15,702 19,936 -21
Other costs of operations 103,989 120,048 -13
------- -------
Total other expense 390,528 408,941 -5
Income before income taxes 296,059 305,145 -3
Applicable income taxes 96,872 94,775 2
-------- --------
Net income $199,187 210,370 -5 %
======== ========
Nine months ended
September 30
----------------------
Dollars in thousands 2007 2006 Change
---------- --------- ------
Interest income $2,632,239 2,443,019 8 %
Interest expense 1,252,212 1,092,196 15
---------- ---------
Net interest income 1,380,027 1,350,823 2
Provision for credit losses 91,000 52,000 75
---------- ---------
Net interest income after
provision for credit losses 1,289,027 1,298,823 -1
Other income
Mortgage banking revenues 81,062 112,882 -28
Service charges on deposit
accounts 303,615 284,739 7
Trust income 112,691 103,777 9
Brokerage services income 46,844 43,999 6
Trading account and foreign
exchange gains 20,465 17,756 15
Gain (loss) on bank investment
securities 1,185 1,427 -
Equity in earnings of Bayview
Lending Group, LLC (5,594) - -
Other revenues from operations 212,231 224,855 -6
---------- ---------
Total other income 772,499 789,435 -2
Other expense
Salaries and employee benefits 682,204 660,224 3
Equipment and net occupancy 126,036 127,612 -1
Printing, postage and supplies 25,886 24,933 4
Amortization of core deposit and
other intangible assets 50,515 44,321 14
Other costs of operations 297,575 310,851 -4
---------- ---------
Total other expense 1,182,216 1,167,941 1
Income before income taxes 879,310 920,317 -4
Applicable income taxes 289,981 294,457 -2
---------- ---------
Net income $ 589,329 625,860 -6 %
========== =========
M&T BANK CORPORATION
Condensed Consolidated Balance Sheet
September 30
-------------------------
Dollars in thousands 2007 2006 Change
---------- ---------- ------
ASSETS
Cash and due from banks $ 1,295,377 1,336,737 -3 %
Interest-bearing deposits at banks 8,503 10,425 -18
Federal funds sold and agreements
to resell securities 399,997 123,245 225
Trading account assets 180,019 176,450 2
Investment securities 8,003,015 7,626,300 5
Loans and leases, net of unearned
discount 44,778,472 42,098,271 6
Less: allowance for credit losses 680,498 646,319 5
---------- ----------
Net loans and leases 44,097,974 41,451,952 6
Goodwill 2,908,849 2,908,849 -
Core deposit and other intangible
assets 200,195 270,910 -26
Other assets 2,914,194 2,468,608 18
---------- ---------
Total assets $60,008,123 56,373,476 6 %
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Noninterest-bearing deposits at U.S.
offices $ 7,565,762 7,754,061 -2 %
Other deposits at U.S. offices 24,719,291 27,348,917 -10
Deposits at foreign office 6,188,126 3,975,811 56
---------- ----------
Total deposits 38,473,179 39,078,789 -2
Short-term borrowings 4,920,901 4,418,356 11
Accrued interest and other
liabilities 859,847 1,001,600 -14
Long-term borrowings 9,516,192 5,723,488 66
---------- ----------
Total liabilities 53,770,119 50,222,233 7
Stockholders' equity (1) 6,238,004 6,151,243 1
---------- ----------
Total liabilities and
stockholders' equity $60,008,123 56,373,476 6 %
=========== ==========
(1) Reflects accumulated other comprehensive loss, net of applicable
income tax effect, of $86.7 million at September 30, 2007 and $86.9
million at September 30, 2006.
M&T BANK CORPORATION
Condensed Consolidated Average
Balance Sheet and Annualized
Taxable-equivalent Rates
Three months ended
September 30
--------------------------------
Dollars in millions 2007 2006
-------------- -------------- Change in
Balance Rate Balance Rate balance
ASSETS ------- ---- ------- ---- ---------
Interest-bearing deposits at
banks $ 8 3.27 % 13 3.67 % -40 %
Federal funds sold and
agreements to resell
securities 248 5.47 136 7.23 82
Trading account assets 59 .98 92 2.97 -36
Investment securities 7,260 5.04 7,898 4.82 -8
Loans and leases, net of
unearned discount
Commercial, financial, etc 12,239 7.25 11,436 7.31 7
Real estate - commercial 15,474 7.54 15,256 7.43 1
Real estate - consumer 5,915 6.47 5,053 6.48 17
Consumer 10,122 7.51 9,965 7.29 2
-------- --------
Total loans and leases, net 43,750 7.28 41,710 7.22 5
-------- --------
Total earning assets 51,325 6.94 49,849 6.83 3
Goodwill 2,909 2,909 -
Core deposit and other
intangible assets 208 281 -26
Other assets 3,420 3,119 10
-------- --------
Total assets $ 57,862 56,158 3 %
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Interest-bearing deposits
NOW accounts $ 464 .84 434 .88 7 %
Savings deposits 14,908 1.67 14,463 1.42 3
Time deposits 9,880 4.70 13,016 4.65 -24
Deposits at foreign office 4,324 5.11 3,674 5.21 18
------ ------
Total interest-bearing
deposits 29,576 3.17 31,587 3.19 -6
------ ------
Short-term borrowings 5,228 5.19 4,441 5.31 18
Long-term borrowings 8,661 5.51 5,660 5.79 53
------ ------
Total interest-bearing
liabilities 43,465 3.88 41,688 3.77 4
Noninterest-bearing deposits 7,360 7,571 -3
Other liabilities 851 814 5
------ ------
Total liabilities 51,676 50,073 3
Stockholders' equity 6,186 6,085 2
------- ------
Total liabilities and
stockholders' equity $57,862 56,158 3 %
====== ======
Net interest spread 3.06 3.06
Contribution of interest-free
funds .59 .62
Net interest margin 3.65 % 3.68 %
Nine months ended
September 30
-------------------------------
Dollars in millions 2007 2006
-------------- ------------- Change in
Balance Rate Balance Rate balance
ASSETS ------- ---- ------- ---- -------
Interest-bearing deposits at
banks $ 8 3.31 % 13 3.17 % -38 %
Federal funds sold and
agreements to resell
securities 333 6.00 66 6.58 402
Trading account assets 60 1.09 97 2.89 -38
Investment securities 7,120 5.03 8,197 4.78 -13
Loans and leases, net of
unearned discount
Commercial, financial, etc 12,051 7.25 11,250 7.01 7
Real estate - commercial 15,509 7.43 14,962 7.24 4
Real estate - consumer 5,909 6.48 4,839 6.32 22
Consumer 10,012 7.47 10,031 7.02 -
------ ------
Total loans and leases, net 43,481 7.27 41,082 7.03 6
------ ------
Total earning assets 51,002 6.94 49,455 6.64 3
Goodwill 2,909 2,908 -
Core deposit and other
intangible assets 224 167 34
Other assets 3,398 3,061 11
------- ------
Total assets $57,533 55,591 3 %
====== ======
LIABILITIES AND STOCKHOLDERS'
EQUITY
Interest-bearing deposits
NOW accounts $ 452 .94 427 .75 6 %
Savings deposits 14,890 1.66 14,351 1.33 4
Time deposits 10,680 4.73 12,532 4.37 -15
Deposits at foreign office 3,918 5.16 3,553 4.85 10
Total interest-bearing ------ ------
deposits 29,940 3.20 30,863 2.96 -3
------ ------
Short-term borrowings 5,213 5.27 4,441 4.93 17
Long-term borrowings 7,963 5.54 5,959 5.49 34
------ ------
Total interest-bearing
liabilities 43,116 3.88 41,263 3.54 4
Noninterest-bearing deposits 7,373 7,530 -2
Other liabilities 835 825 1
------ ------
Total liabilities 51,324 49,618 3
Stockholders' equity 6,209 5,973 4
------- ------
Total liabilities and
stockholders' equity $57,533 55,591 3 %
====== ======
Net interest spread 3.06 3.10
Contribution of interest-free
funds .60 .59
Net interest margin 3.66 % 3.69 %
Media Contact:
C. Michael Zabel
(716) 842-5385
Investor Contact:
Donald J. MacLeod
(716) 842-5138
Web site: http://www.mandtbank.com/