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M&T Bank Corporation Announces Third Quarter Profits
PR Newswire
BUFFALO, N.Y.

BUFFALO, N.Y., Oct. 19, 2011 -- M&T Bank Corporation ("M&T") (NYSE: MTB) today reported its results of operations for the quarter ended September 30, 2011.

GAAP Results of Operations.  Diluted earnings per common share measured in accordance with generally accepted accounting principles ("GAAP") for the third quarter of 2011 were $1.32, compared with $1.48 in the year-earlier quarter.  GAAP-basis net income in the recent quarter aggregated $183 million, compared with $192 million in the third quarter of 2010.  GAAP-basis net income for the third quarter of 2011 expressed as an annualized rate of return on average assets and average common shareholders' equity was .94% and 7.84%, respectively, compared with 1.12% and 9.56%, respectively, in the year-earlier quarter.

As compared with the third quarter of 2010, the recent quarter's performance reflected higher net interest income, a lower provision for credit losses and significantly higher trust income.  Those positive factors were muted by higher noninterest expenses and lower residential mortgage banking revenues.  The increased net interest income, trust income and noninterest expenses were each predominantly related to the acquisition of Wilmington Trust Corporation ("Wilmington Trust") on May 16, 2011.  Included in noninterest expenses in the recent quarter were merger-related expenses associated with the Wilmington Trust acquisition of $16 million, after applicable tax effect, or $.13 of diluted earnings per common share.  Such expenses were related to systems conversions and other costs of integrating operations and introducing Wilmington Trust's former customers to M&T's products and services.  There were no merger-related expenses in the year-earlier quarter.  

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 and gains associated with merging acquired operations into M&T, since such amounts 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.  Reconciliations of GAAP to non-GAAP measures are provided in the financial tables included herein.

Diluted net operating earnings per common share, which exclude the impact of amortization of core deposit and other intangible assets and merger-related gains and expenses, were $1.53 in the recent quarter, down 1% from $1.55 in the third quarter of 2010.  Net operating income during the third quarter of 2011 was $210 million, up 5% from $200 million in the year-earlier quarter.  Expressed as an annualized rate of return on average tangible assets and average tangible common shareholders' equity, net operating income was 1.14% and 16.26%, respectively, in the recent quarter, compared with 1.24% and 19.58% in the third quarter of 2010.

Commenting on M&T's financial results in the third quarter of 2011, Rene F. Jones, Executive Vice President and Chief Financial Officer, said, "The recent quarter's results reflect the impact of M&T's acquisition of Wilmington Trust.  Notably, in late-August the major loan and deposit systems of Wilmington Trust were successfully converted to those of M&T, culminating a significant resource commitment.  Now that the conversions are behind us, we are well positioned to turn our attention towards achieving the economic benefits from combining the organizations."  

Further commenting on recent quarter highlights, Mr. Jones noted, "Despite the continued challenging economic environment and turbulent markets, which dampened our fee income relative to the second quarter, we experienced a number of positive trends.  We were pleased with the credit performance for the period.  Specifically, net charge-offs declined for the fourth consecutive quarter.  We also continued to experience solid growth in customer deposits."

Taxable-equivalent Net Interest Income.  Taxable-equivalent net interest income totaled $623 million in the third quarter of 2011, up from $576 million in the year-earlier period and $593 million in the second quarter of 2011.  The improvement in such income from the prior periods resulted from higher average earning assets, partially offset by a narrowing of the net interest margin.  The net interest margin was 3.68% in the recent quarter, compared with 3.87% in the third quarter of 2010 and 3.75 percent in the second quarter of 2011.  The higher levels of average earning assets in the two most recent quarters as compared with the third quarter of 2010 were predominantly due to the impact of the Wilmington Trust acquisition, which added approximately $9.6 billion of earning assets on the May 16, 2011 acquisition date.  The narrowing of the net interest margin in the recent quarter as compared with the year-earlier quarter and the second 2011 quarter also reflected the impact of the Wilmington Trust transaction, including significantly higher earning balances on deposit with the Federal Reserve.  

Provision for Credit Losses/Asset Quality.  The provision for credit losses was $58 million in the recent quarter, improved from $93 million in the third quarter of 2010 and $63 million in 2011's second quarter.  Net charge-offs of loans totaled $57 million during the third quarter of 2011, compared with $93 million and $59 million in the quarters ended September 30, 2010 and June 30, 2011, respectively.  Expressed as an annualized percentage of average loans outstanding, net charge-offs were .39% and .73% in the third quarter of 2011 and 2010, respectively, and .43% in the second quarter of 2011.

Effective September 30, 2011, M&T has begun to separately report "other acquired impaired loans."  M&T defines other acquired impaired loans as loans that ceased performing in accordance with their contractual terms and became impaired subsequent to the acquisition date.  Nevertheless, in accordance with GAAP, such loans are included in accounting pools which continue to accrue interest.  Other acquired impaired loans, which had previously been aggregated with nonaccrual loans, totaled $218 million or .37% of total loans at September 30, 2011, compared with $141 million or .24% at June 30, 2011 and $98 million or .19% at September 30, 2010.  The increase in such loans from June 30, 2011 was due to loans obtained in the acquisition of Wilmington Trust.

Nonaccrual loans, which exclude other acquired impaired loans, were little changed from June 30, 2011.  Such loans totaled $1.11 billion and $1.12 billion at September 30 and June 30, 2011, respectively, or 1.91% of total loans at each of those dates, compared with $1.00 billion or 1.97% at September 30, 2010.  

Assets taken in foreclosure of defaulted loans were $150 million at September 30, 2011, down from $193 million at September 30, 2010 and $159 million at June 30, 2011.  The decrease in such assets at the two most recent quarter-ends as compared with September 30, 2010 resulted from the sale during 2011's second quarter of a commercial real estate property in New York City with a carrying value of $99 million.  Reflected in assets taken in foreclosure of defaulted loans at September 30 and June 30, 2011 were $51 million and $57 million, respectively, of assets related to the Wilmington Trust acquisition.  

Loans past due 90 days or more and accruing interest totaled $310 million at September 30, 2011, down from $373 million at June 30, 2011.  Included in such past due but accruing loans at the two most recent quarter-ends were $64 million and $130 million, respectively, of loans obtained in the Wilmington Trust acquisition.  At September 30, 2010, loans past due 90 days or more and accruing interest were $215 million.  Included in this category were $212 million, $207 million and $194 million of loans guaranteed by government-related entities at September 30, 2011, June 30, 2011 and September 30, 2010, respectively.

Allowance for Credit Losses.  M&T regularly performs detailed analyses of individual borrowers and portfolios for purposes of assessing the adequacy of the allowance for credit losses.  As a result of those analyses, the allowance for credit losses was $909 million at September 30, 2011, compared with $895 million at September 30, 2010 and $908 million at June 30, 2011.  Beginning in 2009, GAAP requires that expected credit losses associated with loans obtained in an acquisition be reflected in the estimation of loan fair value as of each respective acquisition date and prohibits any carry-over of the acquired entity's allowance for credit losses.  Excluding amounts related to loans obtained in acquisition transactions subsequent to 2008, the allowance-to-legacy loan ratio was 1.79% at September 30, 2011, compared with 1.86% at September 30, 2010 and 1.80% at June 30, 2011.

Noninterest Income and Expense.  Noninterest income totaled $368 million in the recent quarter, compared with $290 million and $502 million in the third quarter of 2010 and the second quarter of 2011, respectively.  Reflected in such income were net pre-tax losses from investment securities of $10 million and $8 million in the recent quarter and the third quarter of 2010, respectively, and net pre-tax gains from investment securities of $84 million in the second quarter of 2011.  

Excluding gains and losses from investment securities in all periods and the non-taxable gain of $65 million recorded in the second quarter of 2011 related to the Wilmington Trust acquisition, noninterest income in the third quarter of 2011 aggregated $378 million, up from $298 million in the third quarter of 2010 and $353 million in 2011's second quarter.  Contributing to those increases were significantly higher trust income, predominantly due to the Wilmington Trust transaction, partially offset by a decline in residential mortgage banking revenues.  That decline reflected M&T's decision to retain the majority of residential mortgage loan originations in the recent quarter rather than selling them.  

Noninterest expense in the third quarter of 2011 aggregated $662 million, compared with $480 million in the year-earlier quarter and $577 million in the second quarter of 2011.  Included in such amounts are expenses considered to be nonoperating in nature consisting of amortization of core deposit and other intangible assets and merger-related expenses.  Exclusive of those expenses, noninterest operating expenses were $619 million in the recent quarter, compared with $467 million in the third quarter of 2010 and $525 million in 2011's second quarter.  The most significant factor for the higher levels of operating expenses in the two most recent quarters as compared with the third quarter of 2010 was the impact of the operations obtained in the Wilmington Trust acquisition mid-way through 2011's second quarter.  

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 and merger-related gains), measures the relationship of operating expenses to revenues.  M&T's efficiency ratio was 61.8% in the recent quarter, compared with 53.4% and 55.6% in the year-earlier quarter and the second quarter of 2011, respectively.  The higher ratio in the recent quarter reflects expenses associated with the operations obtained in the Wilmington Trust acquisition.  M&T should begin to realize certain cost savings related to that acquisition transaction during the final quarter of 2011, but expects that the full realization of operating efficiencies will not happen until 2012.

Balance Sheet.  M&T had total assets of $77.9 billion at September 30, 2011, compared with $68.2 billion at September 30, 2010.  Loans and leases, net of unearned discount, were $58.4 billion at September 30, 2011, compared with $50.8 billion a year earlier.  Total deposits aggregated $59.5 billion at the recent quarter-end, up 22% from $48.7 billion at September 30, 2010.  

Total shareholders' equity rose 14% to $9.4 billion at September 30, 2011 from $8.2 billion a year earlier, representing 12.04% and 12.06%, respectively, of total assets.  Common shareholders' equity was $8.5 billion, or $67.70 per share, at September 30, 2011, compared with $7.5 billion, or $62.69 per share, at September 30, 2010.  Tangible equity per common share rose 18% to $38.11 at September 30, 2011 from $32.23 at September 30, 2010.  Common shareholders' equity per share and tangible equity per common share were $66.71 and $37.00, respectively, at June 30, 2011.  In the calculation of tangible equity per common share, common shareholders' equity is reduced by the carrying values of goodwill and core deposit and other intangible assets, net of applicable deferred tax balances.  M&T's tangible common equity to tangible assets ratio was 6.46% at September 30, 2011, compared with 5.96% and 6.28% at September 30, 2010 and June 30, 2011, respectively.  M&T's estimated Tier 1 common ratio rose to 6.89% at September 30, 2011, improved from 6.42% and 6.67% at September 30, 2010 and June 30, 2011, respectively.

Conference Call.  Investors will have an opportunity to listen to M&T's conference call to discuss third quarter financial results today at 11:00 a.m. Eastern 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 the conference ID #18665770.  The conference call will be webcast live on M&T's website at http://ir.mandtbank.com/events.cfm.  A replay of the call will be available until Friday, October 21, 2011 by calling (800)585-8367, or (404)537-3406 for international participants, and by making reference to ID #18665770.  The event will also be archived and available by 5:00 p.m. today on M&T's website at http://ir.mandtbank.com/events.cfm.

M&T is a financial holding company headquartered in Buffalo, New York.  M&T's principal banking subsidiary, M&T Bank, operates retail and commercial bank branches in New York, Pennsylvania, Maryland, Virginia, West Virginia, Delaware, New Jersey, the District of Columbia and Ontario, Canada. Trust-related services are provided by M&T's Wilmington Trust-affiliated companies and by M&T Bank.

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, collateral securing 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; the impact of changes in market values on trust-related revenues; 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 capital requirements; 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, including tax-related examinations and other matters; 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.

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

           

Nine months ended

       

Amounts in thousands,

   

September 30

           

September 30

       

except per share

   

2011

 

2010

 

Change

       

2011

 

2010

 

Change

   
                                     

Performance

                                   
                                     

Net income

 

$

183,108

 

192,015

 

-5

%

   

$

711,739

 

531,719

 

34

%

 

Net income available to common shareholders

   

164,671

 

176,789

 

-7

       

651,966

 

486,831

 

34

   
                                     

Per common share:

                                   

 Basic earnings

 

$

1.32

 

1.49

 

-11

%

   

$

5.34

 

4.12

 

30

%

 

 Diluted earnings

   

1.32

 

1.48

 

-11

       

5.32

 

4.10

 

30

   

 Cash dividends

 

$

.70

 

.70

 

-

     

$

2.10

 

2.10

 

-

   
                                     

Common shares outstanding:

                                   

 Average - diluted (1)

   

124,860

 

119,155

 

5

%

     

122,521

 

118,766

 

3

%

 

 Period end (2)

   

125,678

 

119,435

 

5

       

125,678

 

119,435

 

5

   
                                     

Return on (annualized):

                                   

 Average total assets  

   

.94

%

1.12

%

         

1.31

%

1.04

%

     

 Average common shareholders' equity  

   

7.84

%

9.56

%

         

10.94

%

9.05

%

     
                                     

Taxable-equivalent net interest income

 

$

623,265

 

575,733

 

8

%

   

$

1,791,066

 

1,711,322

 

5

%

 
                                     

Yield on average earning assets

   

4.29

%

4.65

%

         

4.42

%

4.62

%

     

Cost of interest-bearing liabilities

   

.86

%

1.03

%

         

.89

%

1.04

%

     

Net interest spread

   

3.43

%

3.62

%

         

3.53

%

3.58

%

     

Contribution of interest-free funds

   

.25

%

.25

%

         

.25

%

.25

%

     

Net interest margin

   

3.68

%

3.87

%

         

3.78

%

3.83

%

     
                                     

Net charge-offs to average total

                                   

 net loans (annualized)

   

.39

%

.73

%

         

.46

%

.70

%

     
                                     

Net operating results (3)

                                   
                                     

Net operating income  

 

$

209,996

 

200,225

 

5

%

   

$

715,843

 

558,930

 

28

%

 

Diluted net operating earnings per common
 share

   

1.53

 

1.55

 

-1

       

5.36

 

4.33

 

24

   

Return on (annualized):

                                   

 Average tangible assets

   

1.14

%

1.24

%

         

1.39

%

1.16

%

     

 Average tangible common equity

   

16.26

%

19.58

%

         

20.16

%

19.13

%

     

Efficiency ratio

   

61.79

%

53.40

%

         

57.84

%

54.10

%

     
                                   

 
                   
     

At September 30

       

Loan quality

 

2011

   

2010

 

Change

   
                   

Nonaccrual loans

$

1,113,788

   

1,001,454

 

11  

%

 

Real estate and other foreclosed assets

 

149,868

   

192,600

 

-22  

%

 

 Total nonperforming assets

$

1,263,656

   

1,194,054

 

6  

%

 
                   

Other acquired impaired loans (4)

$

217,759

   

98,106

 

122  

%

 
                   

Accruing loans past due 90 days or more (6)

$

309,966

   

214,769

 

44  

%

 
                   

Renegotiated loans

$

223,233

   

233,671

 

-4  

%

 
                   

Government guaranteed loans included in totals

                 

 above:

                 

 Nonaccrual loans

$

32,937

   

37,218

 

-12  

%

 

 Other acquired impaired loans

 

40,961

   

1,014

 

-  

   

 Accruing loans past due 90 days or more

 

211,808

   

194,223

 

9  

%

 
                   

Purchased impaired loans (5):

                 

 Outstanding customer balance

$

1,393,777

   

113,964

 

-  

   

 Carrying amount

 

703,632

   

52,728

 

-  

   
                   

Nonaccrual loans to total net loans

 

1.91

%

 

1.97

%

     
                   

Allowance for credit losses to:

                 

 Legacy loans

 

1.79

%

 

1.86

%

     

 Total loans

 

1.56

%

 

1.76

%

     
                   

(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 gains and expenses which, except in the calculation of the efficiency ratio, are net of applicable income tax effects. Reconciliations of net income with net operating income appear herein.

 

(4)  Acquired loans that ceased performing in accordance with their contractual terms and became impaired subsequent to the acquisition date, but are included in accounting pools that continue to accrue interest.

 

(5)  Accruing loans that were impaired at acquisition date and recorded at fair value.

 

(6)  Excludes purchased impaired and other acquired impaired loans.

 
                 

 

M&T BANK CORPORATION

 

Financial Highlights, Five Quarter Trend

 
     

Three months ended

   

Amounts in thousands,

   

September 30,

 

June 30,

 

March 31,

 

December 31,

 

September 30,

 

except per share

   

2011

 

2011

 

2011

 

2010

 

2010

 
                                   

Performance

                                 
                                   

Net income

 

$

183,108

   

322,358

   

206,273

   

204,442

   

192,015

   

Net income available to common shareholders

   

164,671

   

297,179

   

190,121

   

189,678

   

176,789

   
                                   

Per common share:

                                 

 Basic earnings

 

$

1.32

   

2.43

   

1.59

   

1.59

   

1.49

   

 Diluted earnings

   

1.32

   

2.42

   

1.59

   

1.59

   

1.48

   

 Cash dividends

 

$

.70

   

.70

   

.70

   

.70

   

.70

   
                                   

Common shares outstanding:

                                 

 Average - diluted (1)

   

124,860

   

122,796

   

119,852

   

119,503

   

119,155

   

 Period end (2)

   

125,678

   

125,622

   

120,410

   

119,774

   

119,435

   
                                   

Return on (annualized):

                                 

 Average total assets  

   

.94

%

 

1.78

%

 

1.23

%

 

1.18

%

 

1.12

%

 

 Average common shareholders'
   equity

   

7.84

%

 

14.94

%

 

10.16

%

 

10.03

%

 

9.56

%

 
                                   

Taxable-equivalent net interest
 income

 

$

623,265

   

592,670

   

575,131

   

580,227

   

575,733

   
                                   

Yield on average earning assets

   

4.29

%

 

4.40

%

 

4.60

%

 

4.58

%

 

4.65

%

 

Cost of interest-bearing liabilities

   

.86

%

 

.89

%

 

.91

%

 

.97

%

 

1.03

%

 

Net interest spread

   

3.43

%

 

3.51

%

 

3.69

%

 

3.61

%

 

3.62

%

 

Contribution of interest-free
 funds

   

.25

%

 

.24

%

 

.23

%

 

.24

%

 

.25

%

 

Net interest margin  

   

3.68

%

 

3.75

%

 

3.92

%

 

3.85

%

 

3.87

%

 
                                   

Net charge-offs to average total
 net loans (annualized)

   

.39

%

 

.43

%

 

.58

%

 

.60

%

 

.73

%

 
                                   

Net operating results (3)

                                 
                                   

Net operating income

 

$

209,996

   

289,487

   

216,360

   

196,235

   

200,225

   

Diluted net operating earnings
 per common share

   

1.53

   

2.16

   

1.67

   

1.52

   

1.55

   

Return on (annualized):

                                 

 Average tangible assets

   

1.14

%

 

1.69

%

 

1.36

%

 

1.20

%

 

1.24

%

 

 Average tangible common
   equity

   

16.26

%

 

24.40

%

 

20.16

%

 

18.43

%

 

19.58

%

 

Efficiency ratio

   

61.79

%

 

55.56

%

 

55.75

%

 

52.55

%

 

53.40

%

 
                                   
           
     

September 30,

 

June 30,

 

March 31,

 

December 31,

 

September 30,

 

Loan quality

   

2011

 

2011

 

2011

 

2010

 

2010

 
                                   

Nonaccrual loans

 

$

1,113,788

   

1,117,584

   

1,081,920

   

1,139,740

   

1,001,454

   

Real estate and other foreclosed
 assets

   

149,868

   

158,873

   

218,203

   

220,049

   

192,600

   

 Total nonperforming assets

 

$

1,263,656

   

1,276,457

   

1,300,123

   

1,359,789

   

1,194,054

   
                                   

Other acquired impaired loans
 (4)

 

$

217,759

   

141,391

   

129,191

   

99,454

   

98,106

   
                                   

Accruing loans past due 90 days
 or more (6)

 

$

309,966

   

373,197

   

264,480

   

269,593

   

214,769

   
                                   

Renegotiated loans

 

$

223,233

   

234,726

   

241,190

   

233,342

   

233,671

   
                                   

Government guaranteed loans
 included in totals above:

                                 

 Nonaccrual loans

 

$

32,937

   

42,337

   

36,300

   

39,883

   

37,218

   

 Other acquired impaired loans

   

40,961

   

36,395

   

33,053

   

16,904

   

1,014

   

 Accruing loans past due 90
   days or more

   

211,808

   

207,135

   

214,505

   

214,111

   

194,223

   
                                   

Purchased impaired loans (5):

                                 

 Outstanding customer balance

 

$

1,393,777

   

1,473,237

   

206,253

   

219,477

   

113,964

   

 Carrying amount

   

703,632

   

752,978

   

88,589

   

97,019

   

52,728

   
                                   

Nonaccrual loans to total net
 loans

   

1.91

%

 

1.91

%

 

2.08

%

 

2.19

%

 

1.97

%

 
                                   

Allowance for credit losses to:

                                 

 Legacy loans

   

1.79

%

 

1.80

%

 

1.81

%

 

1.82

%

 

1.86

%

 

 Total loans

   

1.56

%

 

1.55

%

 

1.73

%

 

1.74

%

 

1.76

%

 
                                   
                                   

(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 gains and expenses which, except in the calculation of the efficiency ratio, are net of applicable income tax effects. Reconciliations of net income with net operating income appear herein.

   

(4)  Acquired loans that ceased performing in accordance with their contractual terms and became impaired subsequent to the acquisition date, but are included in accounting pools that continue to accrue interest.

   

(5)  Accruing loans that were impaired at acquisition date and recorded at fair value.

   

(6)  Excludes purchased impaired and other acquired impaired loans.

   
                                     
                                   

 

M&T BANK CORPORATION 

 

Condensed Consolidated Statement of Income 

 
                                 
   

Three months ended

         

Nine months ended

       
   

September 30

         

September 30

       

Dollars in thousands

 

2011

 

2010

 

Change

     

2011

 

2010

 

Change

   
                                 

Interest income

$

720,351

 

685,900

 

5

%

 

$

2,076,087

 

2,047,070

 

1

%

 

Interest expense

 

103,632

 

116,032

 

-11

     

304,362

 

353,641

 

-14

   
                                 

Net interest income

 

616,719

 

569,868

 

8

     

1,771,725

 

1,693,429

 

5

   
                                 

Provision for credit losses

 

58,000

 

93,000

 

-38

     

196,000

 

283,000

 

-31

   
                                 

Net interest income after

                               

  provision for credit losses

 

558,719

 

476,868

 

17

     

1,575,725

 

1,410,429

 

12

   
                                 

Other income

                               

    Mortgage banking revenues

 

38,141

 

61,052

 

-38

     

125,448

 

149,612

 

-16

   

    Service charges on deposit accounts

 

121,577

 

117,733

 

3

     

351,024

 

367,004

 

-4

   

    Trust income

 

113,652

 

30,485

 

273

     

218,565

 

91,582

 

139

   

    Brokerage services income

 

13,907

 

12,127

 

15

     

43,129

 

38,021

 

13

   

    Trading account and foreign exchange gains

 

4,176

 

6,035

 

-31

     

19,253

 

14,531

 

32

   

    Gain on bank investment securities

 

89

 

1,440

 

-

     

150,186

 

1,909

 

-

   

    Other-than-temporary impairment losses

                               

       recognized in earnings

 

(9,642)

 

(9,532)

 

-

     

(52,213)

 

(58,714)

 

-

   

    Equity in earnings of Bayview Lending Group LLC

 

(6,911)

 

(6,460)

 

-

     

(18,812)

 

(18,353)

 

-

   

    Other revenues from operations

 

93,393

 

77,019

 

21

     

347,878

 

235,570

 

48

   

         Total other income

 

368,382

 

289,899

 

27

     

1,184,458

 

821,162

 

44

   
                                 

Other expense

                               

    Salaries and employee benefits

 

325,197

 

246,389

 

32

     

891,465

 

756,296

 

18

   

    Equipment and net occupancy

 

68,101

 

54,353

 

25

     

184,434

 

165,185

 

12

   

    Printing, postage and supplies

 

10,593

 

7,820

 

35

     

29,518

 

25,412

 

16

   

    Amortization of core deposit and other

                               

       intangible assets

 

17,401

 

13,526

 

29

     

44,455

 

44,834

 

-1

   

    FDIC assessments

 

26,701

 

18,039

 

48

     

72,404

 

60,995

 

19

   

    Other costs of operations

 

214,026

 

140,006

 

53

     

516,209

 

392,841

 

31

   

         Total other expense

 

662,019

 

480,133

 

38

     

1,738,485

 

1,445,563

 

20

   
                                 

Income before income taxes

 

265,082

 

286,634

 

-8

     

1,021,698

 

786,028

 

30

   
                                 

Applicable income taxes

 

81,974

 

94,619

 

-13

     

309,959

 

254,309

 

22

   
                                 

Net income

$

183,108

 

192,015

 

-5

%

 

$

711,739

 

531,719

 

34

%

 
                                 
                               

 

M&T BANK CORPORATION

 

Condensed Consolidated Statement of Income, Five Quarter Trend 

 
                               
   

Three months ended

 
   

September 30,

 

June 30,

 

March 31,

 

December 31,

 

September 30,

 

Dollars in thousands

 

2011

 

2011

 

2011

 

2010

 

2010

 
                               

Interest income

$

720,351

   

688,253

   

667,483

   

682,725

   

685,900

 

Interest expense

 

103,632

   

102,051

   

98,679

   

108,628

   

116,032

 
                               

Net interest income

 

616,719

   

586,202

   

568,804

   

574,097

   

569,868

 
                               

Provision for credit losses

 

58,000

   

63,000

   

75,000

   

85,000

   

93,000

 
                               

Net interest income after

                             

  provision for credit losses

 

558,719

   

523,202

   

493,804

   

489,097

   

476,868

 
                               

Other income

                             

    Mortgage banking revenues

 

38,141

   

42,151

   

45,156

   

35,013

   

61,052

 

    Service charges on deposit accounts

 

121,577

   

119,716

   

109,731

   

111,129

   

117,733

 

    Trust income

 

113,652

   

75,592

   

29,321

   

31,031

   

30,485

 

    Brokerage services income

 

13,907

   

14,926

   

14,296

   

11,648

   

12,127

 

    Trading account and foreign exchange gains

 

4,176

   

6,798

   

8,279

   

12,755

   

6,035

 

    Gain on bank investment securities

 

89

   

110,744

   

39,353

   

861

   

1,440

 

    Other-than-temporary impairment losses

                             

       recognized in earnings

 

(9,642)

   

(26,530)

   

(16,041)

   

(27,567)

   

(9,532)

 

    Equity in earnings of Bayview Lending Group LLC

 

(6,911)

   

(5,223)

   

(6,678)

   

(7,415)

   

(6,460)

 

    Other revenues from operations

 

93,393

   

163,482

   

91,003

   

119,483

   

77,019

 

         Total other income

 

368,382

   

501,656

   

314,420

   

286,938

   

289,899

 
                               

Other expense

                             

    Salaries and employee benefits

 

325,197

   

300,178

   

266,090

   

243,413

   

246,389

 

    Equipment and net occupancy

 

68,101

   

59,670

   

56,663

   

50,879

   

54,353

 

    Printing, postage and supplies

 

10,593

   

9,723

   

9,202

   

8,435

   

7,820

 

    Amortization of core deposit and other

                             

       intangible assets

 

17,401

   

14,740

   

12,314

   

13,269

   

13,526

 

    FDIC assessments

 

26,701

   

26,609

   

19,094

   

18,329

   

18,039

 

    Other costs of operations

 

214,026

   

165,975

   

136,208

   

134,949

   

140,006

 

         Total other expense

 

662,019

   

576,895

   

499,571

   

469,274

   

480,133

 
                               

Income before income taxes

 

265,082

   

447,963

   

308,653

   

306,761

   

286,634

 
                               

Applicable income taxes

 

81,974

   

125,605

   

102,380

   

102,319

   

94,619

 
                               

Net income

$

183,108

   

322,358

   

206,273

   

204,442

   

192,015

 
                               
                             

 

M&T BANK CORPORATION 

 

Condensed Consolidated Balance Sheet 

 
                   
     

September 30

       

Dollars in thousands

   

2011

 

2010

 

Change

   
                   

ASSETS

                 
                   

Cash and due from banks

 

$

1,349,057

 

1,070,625

 

26

%

 
                   

Interest-bearing deposits at banks

   

2,226,779

 

401,624

 

454

   
                   

Federal funds sold and agreements
 to resell securities

   

5,000

 

443,700

 

-99

   
                   

Trading account assets

   

605,557

 

536,702

 

13

   
                   

Investment securities

   

7,173,797

 

7,662,715

 

-6

   
                   

Loans and leases:

                 
                   

  Commercial, financial, etc.

   

15,218,502

 

12,788,136

 

19

   

  Real estate - commercial

   

23,961,306

 

20,580,450

 

16

   

  Real estate - consumer

   

7,065,451

 

5,754,432

 

23

   

  Consumer

   

12,156,005

 

11,668,540

 

4

   

    Total loans and leases, net of unearned discount

   

58,401,264

 

50,791,558

 

15

   

       Less: allowance for credit losses

   

908,525

 

894,720

 

2

   
                   

 Net loans and leases

   

57,492,739

 

49,896,838

 

15

   
                   

Goodwill

   

3,524,625

 

3,524,625

 

-

   
                   

Core deposit and other intangible assets

   

257,656

 

139,186

 

85

   
                   

Other assets

   

5,228,681

 

4,570,822

 

14

   
                   

 Total assets

 

$

77,863,891

 

68,246,837

 

14

%

 
                   
                   

LIABILITIES AND SHAREHOLDERS' EQUITY

 
                   

Noninterest-bearing deposits

 

$

19,637,491

 

14,665,603

 

34

%

 
                   

Interest-bearing deposits

   

39,330,027

 

33,335,104

 

18

   
                   

Deposits at Cayman Islands office

   

514,871

 

653,916

 

-21

   
                   

 Total deposits

   

59,482,389

 

48,654,623

 

22

   
                   

Short-term borrowings

   

694,398

 

1,211,683

 

-43

   
                   

Accrued interest and other liabilities

   

1,563,121

 

1,157,250

 

35

   
                   

Long-term borrowings

   

6,748,857

 

8,991,508

 

-25

   
                   

 Total liabilities

   

68,488,765

 

60,015,064

 

14

   
                   

Shareholders' equity:

                 
                   

  Preferred

   

862,717

 

737,979

 

17

   

  Common (1)  

   

8,512,409

 

7,493,794

 

14

   
                   

    Total shareholders' equity

   

9,375,126

 

8,231,773

 

14

   
                   

 Total liabilities and shareholders' equity

 

$

77,863,891

 

68,246,837

 

14

%

 
                   
                   

(1)  Reflects accumulated other comprehensive loss, net of applicable income tax effect, of $192.5 million at September 30, 2011 and $192.6 million at September 30, 2010.

 
                   
                 

 

M&T BANK CORPORATION 

 

Condensed Consolidated Balance Sheet, Five Quarter Trend 

 
             
     

September 30,

 

June 30,

   

March 31,

   

December 31,

   

September 30,

     

Dollars in thousands

   

2011

 

2011

   

2011

   

2010

   

2010

     
                                     

ASSETS

                                   
                                     

Cash and due from banks

 

$

1,349,057

   

1,297,335

   

972,005

   

908,755

   

1,070,625

     
                                     

Interest-bearing deposits at banks

   

2,226,779

   

2,275,450

   

100,101

   

101,222

   

401,624

     
                                     

Federal funds sold and
 agreements to resell

 securities

   

5,000

   

415,580

   

10,300

   

25,000

   

443,700

     
                                     

Trading account assets

   

605,557

   

502,986

   

413,737

   

523,834

   

536,702

     
                                     

Investment securities

   

7,173,797

   

6,492,265

   

6,507,165

   

7,150,540

   

7,662,715

     
                                     

Loans and leases:

                                   
                                     

  Commercial, financial, etc.

   

15,218,502

   

15,040,892

   

13,826,299

   

13,390,610

   

12,788,136

     

  Real estate - commercial

   

23,961,306

   

24,263,726

   

20,891,615

   

21,183,161

   

20,580,450

     

  Real estate - consumer

   

7,065,451

   

6,970,921

   

6,154,960

   

5,928,056

   

5,754,432

     

  Consumer

   

12,156,005

   

12,265,690

   

11,245,807

   

11,488,555

   

11,668,540

     

    Total loans and leases, net of
      unearned discount

   

58,401,264

   

58,541,229

   

52,118,681

   

51,990,382

   

50,791,558

     

       Less: allowance for credit
         losses

   

908,525

   

907,589

   

903,703

   

902,941

   

894,720

     
                                     

 Net loans and leases

   

57,492,739

   

57,633,640

   

51,214,978

   

51,087,441

   

49,896,838

     
                                     

Goodwill

   

3,524,625

   

3,524,625

   

3,524,625

   

3,524,625

   

3,524,625

     
                                     

Core deposit and other intangible
 assets

   

257,656

   

275,057

   

113,603

   

125,917

   

139,186

     
                                     

Other assets

   

5,228,681

   

5,310,216

   

5,024,694

   

4,573,929

   

4,570,822

     
                                     

 Total assets

 

$

77,863,891

   

77,727,154

   

67,881,208

   

68,021,263

   

68,246,837

     
                                     
                                     

LIABILITIES AND SHAREHOLDERS' EQUITY

                                   
                                     

Noninterest-bearing deposits

 

$

19,637,491

   

18,598,828

   

15,219,562

   

14,557,568

   

14,665,603

     
                                     

Interest-bearing deposits

   

39,330,027

   

40,078,834

   

34,264,867

   

33,641,800

   

33,335,104

     
                                     

Deposits at Cayman Islands office

   

514,871

   

551,553

   

1,063,670

   

1,605,916

   

653,916

     
                                     

 Total deposits

   

59,482,389

   

59,229,215

   

50,548,099

   

49,805,284

   

48,654,623

     
                                     

Short-term borrowings

   

694,398

   

567,144

   

504,676

   

947,432

   

1,211,683

     
                                     

Accrued interest and other
 liabilities

   

1,563,121

   

1,557,685

   

1,015,495

   

1,070,701

   

1,157,250

     
                                     

Long-term borrowings

   

6,748,857

   

7,128,916

   

7,305,420

   

7,840,151

   

8,991,508

     
                                     

 Total liabilities

   

68,488,765

   

68,482,960

   

59,373,690

   

59,663,568

   

60,015,064

     
                                     

Shareholders' equity:

                                   
                                     

  Preferred

   

862,717

   

860,901

   

743,385

   

740,657

   

737,979

     

  Common (1)

   

8,512,409

   

8,383,293

   

7,764,133

   

7,617,038

   

7,493,794

     
                                     

    Total shareholders' equity

   

9,375,126

   

9,244,194

   

8,507,518

   

8,357,695

   

8,231,773

     
                                     

 Total liabilities and shareholders'
   equity

 

$

77,863,891

   

77,727,154

   

67,881,208

   

68,021,263

   

68,246,837

     
                                     
                                     

(1)  Reflects accumulated other comprehensive loss, net of applicable income tax effect, of $192.5 million at September 30, 2011, $228.8 million at June 30, 2011, $197.5 million at March 31, 2011, $205.2 million at December 31, 2010 and $192.6 million at September 30, 2010.

 
                                   

 

M&T BANK CORPORATION

 

Condensed Consolidated Average Balance Sheet

 

and Annualized Taxable-equivalent Rates 

 
                                                                 
     

Three months ended

 

Change in balance

   

Nine months ended 

       
     

September 30,

 

September 30,

 

June 30,

 

September 30, 2011 from

   

September 30 

       

Dollars in millions

   

2011

 

2010

 

2011

 

September 30,

 

June 30,

   

2011

 

2010

 

Change in

   
     

Balance

 

Rate

 

Balance

 

Rate

 

Balance

 

Rate

 

2010

 

2011

   

Balance

 

Rate

 

Balance

 

Rate

 

balance

   

ASSETS

                                                               
                                                                 

Interest-
 bearing
 deposits
 at banks

 

$

1,861

 

.25

%

92

 

.15

%

804

 

.24

%

-

%

 

131

%

 

$

933

 

.24

%

100

 

.06

%

834

%

 
                                                                 

Federal funds
 sold and
 agreements
 to resell
 securities

   

76

 

.14

 

64

 

.26

 

622

 

.09

 

20

   

-88

     

238

 

.10

 

33

 

.27

 

628

   
                                                                 

Trading
 account
 assets

   

85

 

1.75

 

82

 

.65

 

101

 

1.32

 

3

   

-16

     

98

 

1.55

 

69

 

.79

 

41

   
                                                                 

Investment
 securities

   

7,005

 

3.65

 

7,993

 

4.16

 

6,394

 

4.03

 

-12

   

10

     

6,872

 

3.95

 

8,180

 

4.29

 

-16

   
                                                                 

Loans and
 leases, net of
 unearned discount

                                                               

 Commercial,
   financial, etc.

   

15,007

 

3.82

 

12,856

 

3.97

 

14,623

 

3.89

 

17

   

3

     

14,406

 

3.88

 

13,118

 

3.96

 

10

   

 Real estate -
   commercial

   

23,979

 

4.62

 

20,612

 

4.85

 

22,471

 

4.59

 

16

   

7

     

22,495

 

4.64

 

20,745

 

4.66

 

8

   

 Real estate -
   consumer

   

7,002

 

4.95