M&T Bank Corporation Announces Third Quarter Results

BUFFALO, N.Y., Oct. 20, 2021 -- M&T Bank Corporation ("M&T") (NYSE: MTB) today reported its results of operations for the quarter ended September 30, 2021.

GAAP Results of Operations. Diluted earnings per common share measured in accordance with generally accepted accounting principles ("GAAP") were $3.69 in the third quarter of 2021, up from $2.75 in the year-earlier quarter and $3.41 in the second quarter of 2021. GAAP-basis net income was $495 million in the recent quarter, $372 million in the third quarter of 2020 and $458 million in the second 2021 quarter. GAAP-basis net income for the third quarter of 2021 expressed as an annualized rate of return on average assets and average common shareholders' equity was 1.28% and 12.16%, respectively, improved from 1.06% and 9.53%, respectively, in the similar 2020 period and 1.22% and 11.55%, respectively, in the second quarter of 2021. Included in noninterest expenses in the recent quarter were merger-related expenses associated with M&T's proposed acquisition of People's United Financial, Inc. of $9 million ($7 million after tax-effect, or $.05 of diluted earnings per common share), compared with $4 million ($3 million after tax-effect, or $.02 of diluted earnings per common share) in the second quarter of 2021.  There were no merger-related expenses in the third quarter of 2020.

Darren J. King, Executive Vice President and Chief Financial Officer, commented on M&T's third quarter results, "Results in the recent quarter reflect the strength of M&T's diversified business model.  Fee income was robust, driven by strong mortgage banking, trust and brokerage, and other payments revenue relative to the year-earlier and immediately preceding quarters.  Higher expense levels, notably incentive compensation and other professional services costs, were largely associated with the increased revenue but also reflect a reversion to more normal levels.  Our balance sheet remains strong, as evidenced by a Common Equity Tier 1 Capital Ratio of 11.1% at September 30, 2021, improved from 10.7% at the end of the second quarter."

Earnings Highlights

 
                                         
                           

Change 3Q21 vs.

 

($ in millions, except per share data)

 

3Q21

   

3Q20

   

2Q21

   

3Q20

   

2Q21

 
                                         

Net income

 

$

495

   

$

372

   

$

458

     

33

%

   

8

%

Net income available to common shareholders  ̶  diluted

 

$

476

   

$

353

   

$

439

     

35

%

   

8

%

Diluted earnings per common share

 

$

3.69

   

$

2.75

   

$

3.41

     

34

%

   

8

%

Annualized return on average assets

   

1.28

%

   

1.06

%

   

1.22

%

               

Annualized return on average common equity

   

12.16

%

   

9.53

%

   

11.55

%

               

For the first nine-months of 2021, diluted earnings per common share rose 62% to $10.43 from $6.42 in the year-earlier period. GAAP-basis net income for the nine-month period ended September 30, 2021 increased to $1.40 billion from $882 million in the corresponding 2020 period.  Expressed as an annualized rate of return on average assets and average common shareholders' equity, GAAP-basis net income in the nine-month period ended September 30, 2021 was 1.24% and 11.76%, respectively, improved from .89% and 7.57%, respectively, in the corresponding 2020 period. Merger-related expenses for the first nine months of 2021 were $23 million ($17 million after tax-effect, or $.13 of diluted earnings per common share).  There were no merger-related expenses in the similar period of 2020.

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 and core deposit and other intangible asset balances, net of applicable deferred tax amounts) and expenses associated with merging acquired operations into M&T (when incurred), since such items are considered by management to be "nonoperating" in nature.  The amounts of such "nonoperating" expenses are presented in the tables that accompany this release.  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.

Diluted net operating earnings per common share were $3.76 in the recent quarter, up from $2.77 and $3.45 in the third quarter of 2020 and the second quarter of 2021, respectively.  Net operating income totaled $504 million in 2021's third quarter, $375 million in the third quarter of 2020 and $463 million in the second quarter of 2021.  Expressed as an annualized rate of return on average tangible assets and average tangible common shareholders' equity, net operating income in the recent quarter was 1.34% and 17.54%, respectively, 1.10% and 13.94%, respectively, in the year-earlier quarter and 1.27% and 16.68%, respectively, in the second quarter of 2021.

Diluted net operating earnings per common share during the first nine months of 2021 increased to $10.61 from $6.49 in the similar 2020 period.  Net operating income during the nine-month periods ended September 30, 2021 and 2020 was $1.42 billion and $891 million, respectively. Net operating income expressed as an annualized rate of return on average tangible assets and average tangible common shareholders' equity was 1.30% and 17.10%, respectively, in the first nine months of 2021 and was .93% and 11.15%, respectively, in the corresponding 2020 period.

Taxable-equivalent Net Interest Income.  Net interest income expressed on a taxable-equivalent basis totaled $971 million in the recent quarter, up from $947 million in the third quarter of 2020 and $946 million in the second 2021 quarter.  The recent quarter improvement as compared with the year-earlier quarter was largely due to lower rates paid on deposit accounts offset, in part, by the impact of lower average outstanding loan balances. As compared with the second quarter of 2021, the higher net interest income in the recent quarter was predominantly the result of increased yields on loans, reflecting fees received from payoffs of Paycheck Protection Program ("PPP") loans.  The net interest margin in the third quarter of 2021, the third quarter of 2020 and the second quarter of 2021 was 2.74%, 2.95% and 2.77%, respectively. The lower net interest margin in the two most recent quarters reflects higher amounts of low-yielding balances at the Federal Reserve Bank of New York.  Those balances add to net interest income, but lower the reported net interest margin. Interest income from PPP loans, including recognition of fees associated with repaid loans, was $71 million in the recent quarter, compared with $39 million in the third quarter of 2020 and $51 million in the second quarter of 2021.

                                         

Taxable-equivalent Net Interest Income

 
                                         
                           

Change 3Q21 vs.

 

($ in millions)

 

3Q21

   

3Q20

   

2Q21

   

3Q20

   

2Q21

 
                                         

Average earning assets

 

$

140,420

   

$

127,689

   

$

136,951

     

10

%

   

3

%

Net interest income  ̶  taxable-equivalent

 

$

971

   

$

947

   

$

946

     

3

%

   

3

%

Net interest margin

   

2.74

%

   

2.95

%

   

2.77

%

               

Provision for Credit Losses/Asset Quality.  Recaptures of the provision for credit losses of $20 million and $15 million were recorded in the third and second quarters of 2021, respectively.  The provision for credit losses totaled $150 million in the third quarter of 2020. The provision in each quarter adjusts the allowance for credit losses to reflect expected losses that are based on economic forecasts as of each quarter-end date. Net loan charge-offs were $40 million during the recent quarter, compared with $30 million in the third quarter of 2020 and $46 million in the second quarter of 2021. Expressed as an annualized percentage of average loans outstanding, net charge-offs were .17% and .12% in the third quarters of 2021 and 2020, respectively, and .19% in the second quarter of 2021.

Loans classified as nonaccrual totaled $2.24 billion at each of September 30, 2021 and June 30, 2021, compared with $1.24 billion at September 30, 2020. As a percentage of loans outstanding, nonaccrual loans were 2.40%, 2.31% and 1.26% at September 30, 2021, June 30, 2021 and September 30, 2020, respectively. The increase in nonaccrual loans from September 30, 2020 to the two most recent quarter-ends reflects the continuing impact of the pandemic on borrowers' ability to make contractual payments on their loans, most notably loans in the hospitality sector.  Assets taken in foreclosure of defaulted loans were $25 million at September 30, 2021, $50 million a year earlier and $28 million at June 30, 2021.

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 totaled $1.52 billion or 1.62% of loans outstanding at September 30, 2021, compared with $1.76 billion or 1.79% at September 30, 2020 and $1.58 billion or 1.62% at June 30, 2021. The allowance at September 30, 2021, September 30, 2020, and June 30, 2021 represented 1.66%, 1.91%, and 1.69%, respectively, of total loans on those dates, excluding outstanding balances of PPP loans.

Asset Quality Metrics

 
                           

Change 3Q21 vs.

 

($ in millions)

 

3Q21

   

3Q20

   

2Q21

   

3Q20

   

2Q21

 
                                         

At end of quarter

                                       

Nonaccrual loans

 

$

2,242

   

$

1,240

   

$

2,242

     

81

%

   

 

Real estate and other foreclosed assets

 

$

25

   

$

50

   

$

28

     

-50

%

   

-11

%

Total nonperforming assets

 

$

2,267

   

$

1,290

   

$

2,270

     

76

%

   

 

Accruing loans past due 90 days or more (1)

 

$

1,026

   

$

527

   

$

1,077

     

95

%

   

-5

%

Nonaccrual loans as % of loans outstanding

   

2.40

%

   

1.26

%

   

2.31

%

               
                                         

Allowance for credit losses

 

$

1,515

   

$

1,759

   

$

1,575

     

-14

%

   

-4

%

Allowance for credit losses as % of loans outstanding

   

1.62

%

   

1.79

%

   

1.62

%

               
                                         

For the period

                                       

Provision for credit losses

 

$

(20)

   

$

150

   

$

(15)

     

     

 

Net charge-offs

 

$

40

   

$

30

   

$

46

     

35

%

   

-13

%

Net charge-offs as % of average loans (annualized)

   

.17

%

   

.12

%

   

.19

%

               

____________

(1)

Predominantly government-guaranteed residential real estate loans.

Noninterest Income and Expense.  Noninterest income was $569 million in the third quarter of 2021, up from $521 million in the year-earlier quarter and $514 million in the second quarter of 2021. As compared with the third quarter of 2020, the higher level of noninterest income in the recent quarter resulted largely from higher service charges on deposit accounts, merchant discount and credit card fees, mortgage banking revenues and income from M&T's trust and brokerage services businesses. The recent quarter's improvement as compared with the second quarter of 2021 reflects increases in mortgage banking revenues, service charges on deposit accounts, brokerage services income, credit-related fees, and lower unrealized losses on investment securities. Brokerage services income in the recent quarter included approximately $10 million of revenues associated with the sale of select investment products of LPL Financial, an independent financial services broker.  Prior to the transition of M&T's retail brokerage and certain trust customer business to LPL Financial in mid-June 2021, those customers were provided proprietary trust products managed by M&T and revenues related thereto were reported as trust income.

Noninterest Income

 
                                         
                           

Change 3Q21 vs.

 

($ in millions)

 

3Q21

   

3Q20

   

2Q21

   

3Q20

   

2Q21

 
                                         

Mortgage banking revenues

 

$

160

   

$

153

   

$

133

     

4

%

   

20

%

Service charges on deposit accounts

   

105

     

91

     

99

     

15

%

   

7

%

Trust income

   

157

     

150

     

163

     

5

%

   

-4

%

Brokerage services income

   

20

     

12

     

10

     

77

%

   

100

%

Trading account and foreign exchange gains

   

6

     

4

     

7

     

38

%

   

-14

%

Gain (loss) on bank investment securities

 

     

3

     

(11)

   

   

 

Other revenues from operations

   

121

     

108

     

113

     

12

%

   

7

%

Total

 

$

569

   

$

521

   

$

514

     

9

%

   

11

%

Noninterest expense totaled $899 million in the third quarter of 2021, compared with $827 million in the corresponding quarter of 2020 and $865 million in the second quarter of 2021.  Excluding expenses considered to be nonoperating in nature, such as amortization of core deposit and other intangible assets and merger-related expenses, noninterest operating expenses were $888 million in the recent quarter, $823 million in the third quarter of 2020 and $859 million in 2021's second quarter. Factors contributing to the increase in noninterest operating expenses in the recent quarter as compared with the year-earlier quarter were higher costs for salaries and employee benefits (reflecting increased incentive compensation expenses), outside data processing and software, and professional services. As compared with the second quarter of 2021, the higher level of noninterest operating expenses in the recent quarter resulted largely from higher incentive compensation.

Noninterest Expense

 
                                         
                           

Change 3Q21 vs.

 

($ in millions)

 

3Q21

   

3Q20

   

2Q21

   

3Q20

   

2Q21

 
                                         

Salaries and employee benefits

 

$

510

   

$

479

   

$

479

     

7

%

   

7

%

Equipment and net occupancy

   

81

     

81

     

81

   

   

 

Outside data processing and software

   

73

     

65

     

74

     

13

%

   

-2

%

FDIC assessments

   

19

     

12

     

18

     

55

%

   

5

%

Advertising and marketing

   

15

     

12

     

13

     

28

%

   

14

%

Printing, postage and supplies

   

8

     

9

     

11

     

-16

%

   

-29

%

Amortization of core deposit and other intangible assets

   

3

     

4

     

3

     

-30

%

 

 

Other costs of operations

   

190

     

165

     

186

     

16

%

   

3

%

Total

 

$

899

   

$

827

   

$

865

     

9

%

   

4

%

                                         

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 57.7% in the third quarter of 2021, 56.2% in the year-earlier quarter and 58.4% in the second quarter of 2021.

Balance Sheet.  M&T had total assets of $151.9 billion at September 30, 2021, compared with $138.6 billion and $150.6 billion at September 30, 2020 and June 30, 2021, respectively. Loans and leases, net of unearned discount, were $93.6 billion at September 30, 2021, compared with $98.4 billion at September 30, 2020 and $97.1 billion at June 30, 2021. The lower level of loans and leases at the recent quarter-end as compared with September 30, 2020 reflects a $5.4 billion decline in commercial loans, partially offset by growth in consumer loans of $1.5 billion.  The lower commercial loan balances reflect declines in PPP and dealer floor plan loans.  The rise in consumer loans resulted from higher balances of recreational finance and automobile loans. The decline in total loans and leases at the recent quarter-end as compared with June 30, 2021 resulted largely from lower commercial loans of $2.9 billion. The decrease in commercial loans reflects lower balances of PPP loans. Those loans totaled $2.2 billion at September 30, 2021, compared with $6.5 billion at September 30, 2020 and $4.3 billion at June 30, 2021. Total deposits were $128.7 billion at the recent quarter-end, $115.2 billion at September 30, 2020 and $128.3 billion at June 30, 2021. The increased levels of deposits at the two most recent quarter-ends as compared with September 30, 2020 reflect higher levels of liquidity being maintained by many commercial and consumer customers. 

Total shareholders' equity was $17.5 billion, or 11.54% of total assets at September 30, 2021, $16.1 billion, or 11.61% at September 30, 2020 and $16.7 billion, or 11.10% at June 30, 2021. Common shareholders' equity was $15.8 billion, or $122.60 per share, at September 30, 2021, compared with $14.9 billion, or $115.75 per share, a year-earlier and $15.5 billion, or $120.22 per share, at June 30, 2021. Tangible equity per common share was $86.88 at September 30, 2021, $79.85 at September 30, 2020 and $84.47 at June 30, 2021. 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 estimates that the ratio of Common Equity Tier 1 to risk-weighted assets under regulatory capital rules was approximately 11.1% at September 30, 2021, up from 10.7% three months earlier.

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) 876-9173.  International participants, using any applicable international calling codes, may dial (785) 424-1667.  Callers should reference M&T Bank Corporation or the conference ID #MTBQ321.  The conference call will be webcast live through M&T's website at https://ir.mtb.com/events-presentations. A replay of the call will be available through Wednesday, October 27, 2021 by calling (800) 727-6189, or (402) 220-2671 for international participants. No conference ID is required.  The event will also be archived and available by 3:00 p.m. today on M&T's website at https://ir.mtb.com/events-presentations.

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

Who We Are.  We are a bank for communities – bringing the capabilities of a large bank with the care of a locally focused institution. Our purpose is to make a difference in people's lives serving all our stakeholders. The keys to our approach are characterized by responsible lending based on the advantages of local knowledge and scale, and our long history of being prudent stewards of our shareholders' capital. For more on our approach as a bank for communities, please review our latest ESG report available on M&T's website.

Earlier this month it was announced that M&T Bank again ranked in the nation's top 10 for U.S. Small Business Administration lending.  For 13 consecutive years, M&T Bank has remained one of the top 10 SBA lenders in the country.  Additionally in the quarter, M&T Bank continued to focus on its multicultural customers in its diverse communities by establishing several multicultural banking centers across its footprint to enhance local branch experience by offering services in English and other languages.  Customers can also now complete cash transactions at M&T Bank ATMs in four languages.

Forward-Looking Statements.  This news release and related conference call may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and the rules and regulations of the SEC.  Any statement that does not describe historical or current facts is a forward-looking statement, including statements based on current expectations, estimates and projections about M&T's business, and management's beliefs and assumptions.

Statements regarding the potential effects of the COVID-19 pandemic on M&T's business, financial condition, liquidity and results of operations may constitute forward-looking statements and are subject to the risk that the actual effects may differ, possibly materially, from what is reflected in those forward-looking statements due to factors and future developments that are uncertain, unpredictable and in many cases beyond M&T's control, including the scope and duration of the pandemic, actions taken by governmental authorities in response to the pandemic, and the direct and indirect impact of the pandemic on customers, clients, third parties and M&T.

Also as described further below, statements regarding M&T's expectations or predictions regarding the proposed transaction between M&T and People's United Financial, Inc. ("People's United") are forward-looking statements, including statements regarding the expected timing, completion and effects of the proposed transaction as well as M&T's and People's United's expected financial results, prospects, targets, goals and outlook.  

Forward-looking statements are typically identified by words such as "believe," "expect," "anticipate," "intend," "target," "estimate," "continue," or "potential," by future conditional verbs such as "will," "would," "should," "could," or "may," or by variations of such words or by similar expressions.  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 risks, predictions and uncertainties relating to the impact of the People's United transaction (as described in the next paragraph); the impact of the COVID-19 pandemic; 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 or regulations affecting the financial services industry and/or M&T and its subsidiaries individually or collectively, including tax policy; 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, regulatory agencies or legislation; increasing price, product and 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 and 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.

In addition, future factors related to the proposed transaction between M&T and People's United include, among others: the occurrence of any event, change or other circumstances that could give rise to the right of one or both of the parties to terminate the definitive merger agreement between M&T and People's United; the outcome of any legal proceedings that may be instituted against M&T or People's United; the possibility that the proposed transaction will not close when expected or at all because required regulatory or other approvals are not received or other conditions to the closing are not satisfied on a timely basis or at all, or are obtained subject to conditions that are not anticipated; the risk that any announcements relating to the proposed combination could have adverse effects on the market price of the common stock of either or both parties to the combination; the possibility that the anticipated benefits of the transaction will not be realized when expected or at all, including as a result of the impact of, or problems arising from, the integration of the two companies or as a result of the strength of the economy and competitive factors in the areas where M&T and People's United do business; certain restrictions during the pendency of the merger that may impact the parties' ability to pursue certain business opportunities or strategic transactions; the possibility that the transaction may be more expensive to complete than anticipated, including as a result of unexpected factors or events; diversion of management's attention from ongoing business operations and opportunities; potential adverse reactions or changes to business or employee relationships, including those resulting from the announcement or completion of the transaction; M&T's and People's United's success in executing their respective business plans and strategies and managing the risks involved in the foregoing; the business, economic and political conditions in the markets in which the parties operate; and other factors that may affect future results of M&T and People's United.  

Future factors related to the proposed transaction also include risks, such as, among others: that the proposed combination and its announcement could have an adverse effect on either or both parties' ability to retain customers and retain or hire key personnel and maintain relationships with customers; that the proposed combination may be more difficult or time-consuming than anticipated, including in areas such as sales force, cost containment, asset realization, systems integration and other key strategies; and that revenues following the proposed combination may be lower than expected, including for possible reasons such as unexpected costs, charges or expenses resulting from the transactions; as well as the unforeseen risks relating to liabilities of M&T or People's United that may exist, and uncertainty as to the extent of the duration, scope, and impacts of the COVID-19 pandemic on People's United, M&T and the proposed combination.

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 provides further detail regarding these risks and uncertainties in its 2020 Form 10-K, including in the Risk Factors section of such report, as well as in other SEC filings. Forward-looking statements speak only as of the date made, and M&T does not assume any duty and does not undertake to update forward-looking statements.    

 

Financial Highlights

                           
                             
   

Three months ended

           

Nine months ended

         
   

September 30

           

September 30

         

Amounts in thousands, except per share

 

2021

   

2020

   

Change

   

2021

   

2020

   

Change

 

Performance

                                               

Net income

 

$

495,460

     

372,136

     

33

%

 

$

1,400,778

     

882,012

     

59

%

Net income available to common shareholders

   

475,961

     

353,400

     

35

%

   

1,342,812

     

827,204

     

62

%

Per common share:

                                               

Basic earnings

 

$

3.70

     

2.75

     

35

%

 

$

10.44

     

6.42

     

63

%

Diluted earnings

   

3.69

     

2.75

     

34

%

   

10.43

     

6.42

     

62

%

Cash dividends

 

$

1.10

     

1.10

     

   

$

3.30

     

3.30

   

 

Common shares outstanding:

                                               

Average - diluted (1)

   

128,844

     

128,355

     

     

128,786

     

128,813

   

 

Period end (2)

   

128,699

     

128,303

   

     

128,699

     

128,303

   

 

Return on (annualized):

                                               

Average total assets

   

1.28

%

   

1.06

%

           

1.24

%

   

.89

%

       

Average common shareholders' equity

   

12.16

%

   

9.53

%

           

11.76

%

   

7.57

%

       

Taxable-equivalent net interest income

 

$

970,953

     

947,114

     

3

%

 

$

2,902,154

     

2,890,353

   

 

Yield on average earning assets

   

2.82

%

   

3.13

%

           

2.91

%

   

3.53

%

       

Cost of interest-bearing liabilities

   

.14

%

   

.30

%

           

.15

%

   

.50

%

       

Net interest spread

   

2.68

%

   

2.83

%

           

2.76

%

   

3.03

%

       

Contribution of interest-free funds

   

.06

%

   

.12

%

           

.07

%

   

.19

%

       

Net interest margin

   

2.74

%

   

2.95

%

           

2.83

%

   

3.22

%

       

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

   

.17

%

   

.12

%

           

.22

%

   

.21

%

       

Net operating results (3)

                                               

Net operating income

 

$

504,030

     

375,029

     

34

%

 

$

1,424,361

     

890,692

     

60

%

Diluted net operating earnings per common share

   

3.76

     

2.77

     

36

%

   

10.61

     

6.49

     

63

%

Return on (annualized):

                                               

Average tangible assets

   

1.34

%

   

1.10

%

           

1.30

%

   

.93

%

       

Average tangible common equity

   

17.54

%

   

13.94

%

           

17.10

%

   

11.15

%

       

Efficiency ratio

   

57.7

%

   

56.2

%

           

58.8

%

   

57.0

%

       
                                                 
   

At September 30

                             

Loan quality

 

2021

   

2020

   

Change

                         

Nonaccrual loans

 

$

2,242,263

     

1,239,972

     

81

%

                       

Real estate and other foreclosed assets

   

24,786

     

49,872

     

-50

%

                       

Total nonperforming assets

 

$

2,267,049

     

1,289,844

     

76

%

                       

Accruing loans past due 90 days or more (4)

 

$

1,026,080

     

527,258

     

95

%

                       

Government guaranteed loans included in totals above:

                                               

Nonaccrual loans

 

$

47,358

     

45,975

     

3

%

                       

Accruing loans past due 90 days or more

   

947,091

     

505,446

     

87

%

                       

Renegotiated loans

 

$

242,955

     

242,581

   

                         

Nonaccrual loans to total net loans

   

2.40

%

   

1.26

%

                               

Allowance for credit losses to total loans

   

1.62

%

   

1.79

%

                               

______________

(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. Reconciliations of net income with net operating income appear herein.

(4)

Predominantly residential real estate loans.

 

Financial Highlights, Five Quarter Trend

 
   

Three months ended

 
   

September 30,

   

June 30,

   

March 31,

   

December 31,

   

September 30,

 

Amounts in thousands, except per share

 

2021

   

2021

   

2021

   

2020

   

2020

 

Performance

                                       

Net income

 

$

495,460

     

458,069

     

447,249

     

471,140

     

372,136

 

Net income available to common shareholders

   

475,961

     

438,759

     

428,093

     

451,869

     

353,400

 

Per common share:

                                       

Basic earnings

 

$

3.70

     

3.41

     

3.33

     

3.52

     

2.75

 

Diluted earnings

   

3.69

     

3.41

     

3.33

     

3.52

     

2.75

 

Cash dividends

 

$

1.10

     

1.10

     

1.10

     

1.10

     

1.10

 

Common shares outstanding:

                                       

Average - diluted (1)

   

128,844

     

128,842

     

128,669

     

128,379

     

128,355

 

Period end (2)

   

128,699

     

128,686

     

128,658

     

128,333

     

128,303

 

Return on (annualized):

                                       

Average total assets

   

1.28

%

   

1.22

%

   

1.22

%

   

1.30

%

   

1.06

%

Average common shareholders' equity

   

12.16

%

   

11.55

%

   

11.57

%

   

12.07

%

   

9.53

%

Taxable-equivalent net interest income

 

$

970,953

     

946,072

     

985,128

     

993,252

     

947,114

 

Yield on average earning assets

   

2.82

%

   

2.85

%

   

3.08

%

   

3.15

%

   

3.13

%

Cost of interest-bearing liabilities

   

.14

%

   

.14

%

   

.18

%

   

.25

%

   

.30

%

Net interest spread

   

2.68

%

   

2.71

%

   

2.90

%

   

2.90

%

   

2.83

%

Contribution of interest-free funds

   

.06

%

   

.06

%

   

.07

%

   

.10

%

   

.12

%

Net interest margin

   

2.74

%

   

2.77

%

   

2.97

%

   

3.00

%

   

2.95

%

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

   

.17

%

   

.19

%

   

.31

%

   

.39

%

   

.12

%

Net operating results (3)

                                       

Net operating income

 

$

504,030

     

462,959

     

457,372

     

473,453

     

375,029

 

Diluted net operating earnings per common share

   

3.76

     

3.45

     

3.41

     

3.54

     

2.77

 

Return on (annualized):

                                       

Average tangible assets

   

1.34

%

   

1.27

%

   

1.29

%

   

1.35

%

   

1.10

%

Average tangible common equity

   

17.54

%

   

16.68

%

   

17.05

%

   

17.53

%

   

13.94

%

Efficiency ratio

   

57.7

%

   

58.4

%

   

60.3

%

   

54.6

%

   

56.2

%

                                         
   

September 30,

   

June 30,

   

March 31,

   

December 31,

   

September 30,

 

Loan quality

 

2021

   

2021

   

2021

   

2020

   

2020

 

Nonaccrual loans

 

$

2,242,263

     

2,242,057

     

1,957,106

     

1,893,299

     

1,239,972

 

Real estate and other foreclosed assets

   

24,786

     

27,902

     

29,797

     

34,668

     

49,872

 

Total nonperforming assets

 

$

2,267,049

     

2,269,959

     

1,986,903

     

1,927,967

     

1,289,844

 

Accruing loans past due 90 days or more (4)

 

$

1,026,080

     

1,077,227

     

1,084,553

     

859,208

     

527,258

 

Government guaranteed loans included in totals above:

                                       

Nonaccrual loans

 

$

47,358

     

49,796

     

51,668

     

48,820

     

45,975

 

Accruing loans past due 90 days or more

   

947,091

     

1,029,331

     

1,044,599

     

798,121

     

505,446

 

Renegotiated loans

 

$

242,955

     

236,377

     

242,121

     

238,994

     

242,581

 

Nonaccrual loans to total net loans

   

2.40

%

   

2.31

%

   

1.97

%

   

1.92

%

   

1.26

%

Allowance for credit losses to total loans

   

1.62

%

   

1.62

%

   

1.65

%

   

1.76

%

   

1.79

%

______________

(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. Reconciliations of net income with net operating income appear herein.

(4)

Predominantly residential real estate loans.

 

Condensed Consolidated Statement of Income

 
   

Three months ended

           

Nine months ended

         
   

September 30

           

September 30

         

Dollars in thousands

 

2021

   

2020

   

Change

   

2021

   

2020

   

Change

 

Interest income

 

$

992,946

     

1,001,161

     

-1

%

 

$

2,980,266

     

3,153,822

     

-6

%

Interest expense

   

25,696

     

58,066

     

-56

     

89,281

     

276,785

     

-68

 

Net interest income

   

967,250

     

943,095

     

3

     

2,890,985

     

2,877,037

   

 

Provision for credit losses

   

(20,000)

     

150,000

     

     

(60,000)

     

725,000

     

 

Net interest income after provision for credit losses

   

987,250

     

793,095

     

24

     

2,950,985

     

2,152,037

     

37

 

Other income

                                               

Mortgage banking revenues

   

159,995

     

153,267

     

4

     

432,062

     

426,200

     

1

 

Service charges on deposit accounts

   

105,426

     

91,355

     

15

     

296,721

     

274,971

     

8

 

Trust income

   

156,876

     

149,937

     

5

     

475,889

     

450,570

     

6

 

Brokerage services income

   

20,490

     

11,602

     

77

     

43,868

     

35,194

     

25

 

Trading account and foreign exchange gains

   

5,563

     

4,026

     

38

     

18,349

     

33,332

     

-45

 

Gain (loss) on bank investment securities

   

291

     

2,773

   

     

(22,646)

     

(11,040)

     

 

Other revenues from operations

   

120,485

     

107,601

     

12

     

344,114

     

327,967

     

5

 

Total other income

   

569,126

     

520,561

     

9

     

1,588,357

     

1,537,194

     

3

 

Other expense

                                               

Salaries and employee benefits

   

510,422

     

478,897

     

7

     

1,530,634

     

1,474,582

     

4

 

Equipment and net occupancy

   

80,738

     

81,080

   

     

244,057

     

237,809

     

3

 

Outside data processing and software

   

72,782

     

64,660

     

13

     

213,025

     

190,446

     

12

 

FDIC assessments

   

18,810

     

12,121

     

55

     

50,874

     

38,599

     

32

 

Advertising and marketing

   

15,208

     

11,855

     

28

     

43,200

     

44,072

     

-2

 

Printing, postage and supplies

   

7,917

     

9,422

     

-16

     

28,367

     

31,534

     

-10

 

Amortization of core deposit and other

   intangible assets

   

2,738

     

3,914

     

-30

     

8,213

     

11,740

     

-30

 

Other costs of operations

   

190,719

     

164,825

     

16

     

565,753

     

511,450

     

11

 

Total other expense

   

899,334

     

826,774

     

9

     

2,684,123

     

2,540,232

     

6

 

Income before income taxes

   

657,042

     

486,882

     

35

     

1,855,219

     

1,148,999

     

61

 

Applicable income taxes

   

161,582

     

114,746

     

41

     

454,441

     

266,987

     

70

 

Net income

 

$

495,460

     

372,136

     

33

%

 

$

1,400,778

     

882,012

     

59

%

 

Condensed Consolidated Statement of Income, Five Quarter Trend

 
   

Three months ended

 
   

September 30,

   

June 30,

   

March 31,

   

December 31,

   

September 30,

 

Dollars in thousands

 

2021

   

2021

   

2021

   

2020

   

2020

 

Interest income

 

$

992,946

     

970,358

     

1,016,962

     

1,038,890

     

1,001,161

 

Interest expense

   

25,696

     

28,018

     

35,567

     

49,610

     

58,066

 

Net interest income

   

967,250

     

942,340

     

981,395

     

989,280

     

943,095

 

Provision for credit losses

   

(20,000)

     

(15,000)

     

(25,000)

     

75,000

     

150,000

 

Net interest income after provision for credit losses

   

987,250

     

957,340

     

1,006,395

     

914,280

     

793,095

 

Other income

                                       

Mortgage banking revenues

   

159,995

     

133,313

     

138,754

     

140,441

     

153,267

 

Service charges on deposit accounts

   

105,426

     

98,518

     

92,777

     

95,817

     

91,355

 

Trust income

   

156,876

     

162,991

     

156,022

     

151,314

     

149,937

 

Brokerage services income

   

20,490

     

10,265

     

13,113

     

12,234

     

11,602

 

Trading account and foreign exchange gains

   

5,563

     

6,502

     

6,284

     

7,204

     

4,026

 

Gain (loss) on bank investment securities

   

291

     

(10,655)

     

(12,282)

     

1,619

     

2,773

 

Other revenues from operations

   

120,485

     

112,699

     

110,930

     

142,621

     

107,601

 

Total other income

   

569,126

     

513,633

     

505,598

     

551,250

     

520,561

 

Other expense

                                       

Salaries and employee benefits

   

510,422

     

479,134

     

541,078

     

476,110

     

478,897

 

Equipment and net occupancy

   

80,738

     

80,848

     

82,471

     

84,228

     

81,080

 

Outside data processing and software

   

72,782

     

74,492

     

65,751

     

68,034

     

64,660

 

FDIC assessments

   

18,810

     

17,876

     

14,188

     

15,204

     

12,121

 

Advertising and marketing

   

15,208

     

13,364

     

14,628

     

17,832

     

11,855

 

Printing, postage and supplies

   

7,917

     

11,133

     

9,317

     

8,335

     

9,422

 

Amortization of core deposit and other
   intangible assets

   

2,738

     

2,737

     

2,738

     

3,129

     

3,914

 

Other costs of operations

   

190,719

     

185,761

     

189,273

     

172,136

     

164,825

 

Total other expense

   

899,334

     

865,345

     

919,444

     

845,008

     

826,774

 

Income before income taxes

   

657,042

     

605,628

     

592,549

     

620,522

     

486,882

 

Applicable income taxes

   

161,582

     

147,559

     

145,300

     

149,382

     

114,746

 

Net income

 

$

495,460

     

458,069

     

447,249

     

471,140

     

372,136

 

 

Condensed Consolidated Balance Sheet

 
   

September 30

           

Dollars in thousands

 

2021

   

2020

   

Change

   

ASSETS

                         

Cash and due from banks

 

$

1,479,712

     

1,489,232

     

-1

 

%

Interest-bearing deposits at banks

   

38,445,788

     

20,197,937

     

90

   

Trading account

   

624,556

     

1,215,573

     

-49

   

Investment securities

   

6,447,622

     

7,723,004

     

-17

   

Loans and leases:

                         

Commercial, financial, etc.

   

22,514,940

     

27,891,648

     

-19

   

Real estate - commercial

   

37,023,952

     

37,582,084

     

-1

   

Real estate - consumer

   

16,209,354

     

16,663,708

     

-3

   

Consumer

   

17,834,648

     

16,309,608

     

9

   

Total loans and leases, net of unearned discount

   

93,582,894

     

98,447,048

     

-5

   

Less: allowance for credit losses

   

1,515,024

     

1,758,505

     

-14

   

Net loans and leases

   

92,067,870

     

96,688,543

     

-5

   

Goodwill

   

4,593,112

     

4,593,112

     

   

Core deposit and other intangible assets

   

5,952

     

17,294

     

-66

   

Other assets

   

8,236,582

     

6,702,048

     

23

   

Total assets

 

$

151,901,194

     

138,626,743

     

10

 

%

                           

LIABILITIES AND SHAREHOLDERS' EQUITY

                         

Noninterest-bearing deposits

 

$

56,542,309

     

44,201,670

     

28

 

%

Interest-bearing deposits

   

72,158,987

     

70,061,680

     

3

   

Deposits at Cayman Islands office

   

     

899,989

     

-100

   

Total deposits

   

128,701,296

     

115,163,339

     

12

   

Short-term borrowings

   

103,548

     

46,123

     

125

   

Accrued interest and other liabilities

   

2,067,188

     

1,857,383

     

11

   

Long-term borrowings

   

3,500,391

     

5,458,885

     

-36

   

Total liabilities

   

134,372,423

     

122,525,730

     

10

   

Shareholders' equity:

                         

Preferred

   

1,750,000

     

1,250,000

     

40

   

Common

   

15,778,771

     

14,851,013

     

6

   

Total shareholders' equity

   

17,528,771

     

16,101,013

     

9

   

Total liabilities and shareholders' equity

 

$

151,901,194

     

138,626,743

     

10

 

%

 

Condensed Consolidated Balance Sheet, Five Quarter Trend

 
   
   

September 30,

   

June 30,

   

March 31,

   

December 31,

   

September 30,

 

Dollars in thousands

 

2021

   

2021

   

2021

   

2020

   

2020

 

ASSETS

                                       

Cash and due from banks

 

$

1,479,712

     

1,410,468

     

1,258,989

     

1,552,743

     

1,489,232

 

Interest-bearing deposits at banks

   

38,445,788

     

33,864,824

     

31,407,227

     

23,663,810

     

20,197,937

 

Federal funds sold

   

     

     

1,000

     

     

 

Trading account

   

624,556

     

712,558

     

687,359

     

1,068,581

     

1,215,573

 

Investment securities

   

6,447,622

     

6,143,177

     

6,610,667

     

7,045,697

     

7,723,004

 

Loans and leases:

                                       

Commercial, financial, etc.

   

22,514,940

     

25,409,291

     

27,811,190

     

27,574,564

     

27,891,648

 

Real estate - commercial

   

37,023,952

     

37,558,775

     

37,425,974

     

37,637,889

     

37,582,084

 

Real estate - consumer

   

16,209,354

     

16,704,951

     

17,349,683

     

16,752,993

     

16,663,708

 

Consumer

   

17,834,648

     

17,440,415

     

16,712,233

     

16,570,421

     

16,309,608

 

Total loans and leases, net of unearned discount

   

93,582,894

     

97,113,432

     

99,299,080

     

98,535,867

     

98,447,048

 

Less: allowance for credit losses

   

1,515,024

     

1,575,128

     

1,636,206

     

1,736,387

     

1,758,505

 

Net loans and leases

   

92,067,870

     

95,538,304

     

97,662,874

     

96,799,480

     

96,688,543

 

Goodwill

   

4,593,112

     

4,593,112

     

4,593,112

     

4,593,112

     

4,593,112

 

Core deposit and other intangible assets

   

5,952

     

8,690

     

11,427

     

14,165

     

17,294

 

Other assets

   

8,236,582

     

8,351,574

     

8,248,405

     

7,863,517

     

6,702,048

 

Total assets

 

$

151,901,194

     

150,622,707

     

150,481,060

     

142,601,105

     

138,626,743

 
                                         

LIABILITIES AND SHAREHOLDERS' EQUITY

                                       

Noninterest-bearing deposits

 

$

56,542,309

     

55,621,230

     

53,641,419

     

47,572,884

     

44,201,670

 

Interest-bearing deposits

   

72,158,987

     

72,647,542

     

74,193,255

     

71,580,750

     

70,061,680

 

Deposits at Cayman Islands office

   

     

     

641,691

     

652,104

     

899,989

 

Total deposits

   

128,701,296

     

128,268,772

     

128,476,365

     

119,805,738

     

115,163,339

 

Short-term borrowings

   

103,548

     

91,235

     

58,957

     

59,482

     

46,123

 

Accrued interest and other liabilities

   

2,067,188

     

2,042,948

     

2,000,727

     

2,166,409

     

1,857,383

 

Long-term borrowings

   

3,500,391

     

3,499,448

     

3,498,503

     

4,382,193

     

5,458,885

 

Total liabilities

   

134,372,423

     

133,902,403

     

134,034,552

     

126,413,822

     

122,525,730

 

Shareholders' equity:

                                       

Preferred

   

1,750,000

     

1,250,000

     

1,250,000

     

1,250,000

     

1,250,000

 

Common

   

15,778,771

     

15,470,304

     

15,196,508

     

14,937,283

     

14,851,013

 

Total shareholders' equity

   

17,528,771

     

16,720,304

     

16,446,508

     

16,187,283

     

16,101,013

 

Total liabilities and shareholders' equity

 

$

151,901,194

     

150,622,707

     

150,481,060

     

142,601,105

     

138,626,743

 

 

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, 2021 from

     

September 30,

 

Change

 

Dollars in millions

 

2021

 

2020

 

2021

 

September 30,

 

June 30,

     

2021

 

2020

 

in

 
   

Balance

   

Rate

 

Balance

   

Rate

 

Balance

   

Rate

 

2020

 

2021

     

Balance

   

Rate

 

Balance

   

Rate

 

balance

 

ASSETS

                                                                                             

Interest-bearing deposits at banks

 

$

39,036

     

.15

%

 

16,440

     

.10

%

 

32,081

     

.11

%

 

137

%

 

22

%

   

$

32,969

     

.12

%

 

13,021

     

.28

%

 

153

%

Federal funds sold and agreements to
resell securities

   

     

.47

   

5,113

     

.13

   

     

.48

   

-100

   

40

       

223

     

.12

   

2,353

     

.33

   

 

Trading account

   

51

     

2.71

   

50

     

1.62

   

49

     

1.76

   

2

   

3

       

50

     

1.97

   

54

     

2.15

   

-7

 

Investment securities

   

6,019

     

2.19

   

7,876

     

1.95

   

6,211

     

2.23

   

-24

   

-3

       

6,276

     

2.23

   

8,490

     

2.14

   

-26

 

Loans and leases, net of unearned
discount

                                                                                             

Commercial, financial, etc.

   

23,730

     

3.96

   

28,333

     

3.05

   

27,055

     

3.26

   

-16

   

-12

       

26,155

     

3.57

   

27,455

     

3.37

   

-5

 

Real estate - commercial

   

37,547

     

3.87

   

37,243

     

4.19

   

37,419

     

3.92

   

1

   

       

37,525

     

3.98

   

36,743

     

4.47

   

2

 

Real estate - consumer

   

16,379

     

3.59

   

16,558

     

3.69

   

17,022

     

3.54

   

-1

   

-4

       

16,932

     

3.56

   

16,032

     

3.90

   

6

 

Consumer

   

17,658

     

4.34

   

16,076

     

4.76

   

17,114

     

4.44

   

10

   

3

       

17,134

     

4.47

   

15,683

     

4.96

   

9

 

Total loans and leases, net

   

95,314

     

3.95

   

98,210

     

3.89

   

98,610

     

3.79

   

-3

   

-3

       

97,746

     

3.91

   

95,913

     

4.17

   

2

 

Total earning assets

   

140,420

     

2.82

   

127,689

     

3.13

   

136,951

     

2.85

   

10

   

3

       

137,264

     

2.91

   

119,831

     

3.53

   

15

 

Goodwill

   

4,593

           

4,593

           

4,593

           

   

       

4,593

           

4,593

           

 

Core deposit and other intangible assets

   

7

           

19

           

10

           

-62

   

-27

       

10

           

23

           

-57

 

Other assets

   

9,017

           

7,880

           

9,087

           

14

   

-1

       

9,100

           

7,983

           

14

 

Total assets

 

$

154,037

           

140,181

           

150,641

           

10

%

 

2

%

   

$

150,967

           

132,430

           

14

%

                                                                                               

LIABILITIES AND SHAREHOLDERS'
EQUITY

                                                                                             

Interest-bearing deposits

                                                                                             

Savings and interest-checking
deposits

 

$

70,976

     

.04

   

65,848

     

.14

   

71,561

     

.05

   

8

%

 

-1

%

   

$

71,000

     

.05

   

61,729

     

.27

   

15

%

Time deposits

   

3,061

     

.46

   

4,715

     

1.22

   

3,358

     

.61

   

-35

   

-9

       

3,381

     

.62

   

5,245

     

1.43

   

-36

 

Deposits at Cayman Islands office

   

     

   

957

     

.10

   

50

     

.12

   

-100

   

-100

       

242

     

.11

   

1,214

     

.42

   

-80

 

Total interest-bearing deposits

   

74,037

     

.06

   

71,520

     

.21

   

74,969

     

.07

   

4

   

-1

       

74,623

     

.08

   

68,188

     

.37

   

9

 

Short-term borrowings

   

91

     

.01

   

62

     

.01

   

61

     

.01

   

48

   

50

       

72

     

.01

   

61

     

.06

   

18

 

Long-term borrowings

   

3,431

     

1.75

   

5,499

     

1.51

   

3,429

     

1.74

   

-38

   

       

3,569

     

1.76

   

5,974

     

2.01

   

-40

 

Total interest-bearing liabilities

   

77,559

     

.14

   

77,081

     

.30

   

78,459

     

.14

   

1

   

-1

       

78,264

     

.15

   

74,223

     

.50

   

5

 

Noninterest-bearing deposits

   

57,218

           

44,786

           

53,444

           

28

   

7

       

53,864

           

39,931

           

35

 

Other liabilities

   

2,151

           

2,241

           

2,167

           

-4

   

-1

       

2,167

           

2,360

           

-8

 

Total liabilities

   

136,928

           

124,108

           

134,070

           

10

   

2

       

134,295

           

116,514

           

15

 

Shareholders' equity

   

17,109

           

16,073

           

16,571

           

6

   

3

       

16,672

           

15,916

           

5

 

Total liabilities and shareholders'
equity

 

$

154,037

           

140,181

           

150,641

           

10

%

 

2

%

   

$

150,967

           

132,430

           

14

%

                                                                                               

Net interest spread

           

2.68

           

2.83

           

2.71

                           

2.76

           

3.03

       

Contribution of interest-free funds

           

.06

           

.12

           

.06

                           

.07

           

.19

       

Net interest margin

           

2.74

%

         

2.95

%

         

2.77

%

                         

2.83

%

         

3.22

%

     

 

Reconciliation of Quarterly GAAP to Non-GAAP Measures

 
   

Three months ended

   

Nine months ended

 
   

September 30

   

September 30

 
   

2021

   

2020

   

2021

   

2020

 

Income statement data

                               

In thousands, except per share

                               

Net income

                               

Net income

 

$

495,460

     

372,136

     

1,400,778

     

882,012

 

Amortization of core deposit and other intangible assets (1)

   

2,028

     

2,893

     

6,085

     

8,680

 

Merger-related expenses (1)

   

6,542

     

     

17,498

     

 

Net operating income

 

$

504,030

     

375,029

     

1,424,361

     

890,692

 
                                 

Earnings per common share

                               

Diluted earnings per common share

 

$

3.69

     

2.75

     

10.43

     

6.42

 

Amortization of core deposit and other intangible assets (1)

   

.02

     

.02

     

.05

     

.07

 

Merger-related expenses (1)

   

.05

     

     

.13

     

 

Diluted net operating earnings per common share

 

$

3.76

     

2.77

     

10.61

     

6.49

 
                                 

Other expense

                               

Other expense

 

$

899,334

     

826,774

     

2,684,123

     

2,540,232

 

Amortization of core deposit and other intangible assets

   

(2,738)

     

(3,914)

     

(8,213)

     

(11,740)

 

Merger-related expenses

   

(8,826)

     

     

(22,670)

     

 

Noninterest operating expense

 

$

887,770

     

822,860

     

2,653,240

     

2,528,492

 

Merger-related expenses

                               

Salaries and employee benefits

 

$

60

     

     

64

     

 

Equipment and net occupancy

   

1

     

     

1

     

 

Outside data processing and software

   

625

     

     

869

     

 

Advertising and marketing

   

505

     

     

529

     

 

Printing, postage and supplies

   

730

     

     

2,779

     

 

Other costs of operations

   

6,905

     

     

18,428

     

 

Other expense

 

$

8,826

     

     

22,670

     

 

Efficiency ratio

                               

Noninterest operating expense (numerator)

 

$

887,770

     

822,860

     

2,653,240

     

2,528,492

 

Taxable-equivalent net interest income

 

$

970,953

     

947,114

     

2,902,154

     

2,890,353

 

Other income

   

569,126

     

520,561

     

1,588,357

     

1,537,194

 

Less:  Gain (loss) on bank investment securities

   

291

     

2,773

     

(22,646)

     

(11,040)

 

Denominator

 

$

1,539,788

     

1,464,902

     

4,513,157

     

4,438,587

 

Efficiency ratio

   

57.7

%

   

56.2

%

   

58.8

%

   

57.0

%

Balance sheet data

                               

In millions

                               

Average assets

                               

Average assets

 

$

154,037

     

140,181

     

150,967

     

132,430

 

Goodwill

   

(4,593)

     

(4,593)

     

(4,593)

     

(4,593)

 

Core deposit and other intangible assets

   

(7)

     

(19)

     

(10)

     

(23)

 

Deferred taxes

   

2

     

5

     

2

     

6

 

Average tangible assets

 

$

149,439

     

135,574

     

146,366

     

127,820

 

Average common equity

                               

Average total equity

 

$

17,109

     

16,073

     

16,672

     

15,916

 

Preferred stock

   

(1,495)

     

(1,250)

     

(1,332)

     

(1,250)

 

Average common equity

   

15,614

     

14,823

     

15,340

     

14,666

 

Goodwill

   

(4,593)

     

(4,593)

     

(4,593)

     

(4,593)

 

Core deposit and other intangible assets

   

(7)

     

(19)

     

(10)

     

(23)

 

Deferred taxes

   

2

     

5

     

2

     

6

 

Average tangible common equity

 

$

11,016

     

10,216

     

10,739

     

10,056

 

At end of quarter

                               

Total assets

                               

Total assets

 

$

151,901

     

138,627

                 

Goodwill

   

(4,593)

     

(4,593)

                 

Core deposit and other intangible assets

   

(6)

     

(17)

                 

Deferred taxes

   

2

     

4

                 

Total tangible assets

 

$

147,304

     

134,021

                 

Total common equity

                               

Total equity

 

$

17,529

     

16,101

                 

Preferred stock

   

(1,750)

     

(1,250)

                 

Common equity

   

15,779

     

14,851

                 

Goodwill

   

(4,593)

     

(4,593)

                 

Core deposit and other intangible assets

   

(6)

     

(17)

                 

Deferred taxes

   

2

     

4

                 

Total tangible common equity

 

$

11,182

     

10,245

                 

__________________

(1)

After any related tax effect.

 

Reconciliation of Quarterly GAAP to Non-GAAP Measures, Five Quarter Trend

 
   
   

Three months ended

 
   

September 30,

   

June 30,

   

March 31,

   

December 31,

   

September 30,

 
   

2021

   

2021

   

2021

   

2020

   

2020

 

Income statement data

                                       

In thousands, except per share

                                       

Net income

                                       

Net income

 

$

495,460

     

458,069

     

447,249

     

471,140

     

372,136

 

Amortization of core deposit and other intangible assets (1)

   

2,028

     

2,023

     

2,034

     

2,313

     

2,893

 

Merger-related expenses (1)

   

6,542

     

2,867

     

8,089

     

     

 

Net operating income

 

$

504,030

     

462,959

     

457,372

     

473,453

     

375,029

 
                                         

Earnings per common share

                                       

Diluted earnings per common share

 

$

3.69

     

3.41

     

3.33

     

3.52

     

2.75

 

Amortization of core deposit and other intangible assets (1)

   

.02

     

.02

     

.02

     

.02

     

.02

 

Merger-related expenses (1)

   

.05

     

.02

     

.06

     

     

 

Diluted net operating earnings per common share

 

$

3.76

     

3.45

     

3.41

     

3.54

     

2.77

 
                                         

Other expense

                                       

Other expense

 

$

899,334

     

865,345

     

919,444

     

845,008

     

826,774

 

Amortization of core deposit and other intangible assets

   

(2,738)

     

(2,737)

     

(2,738)

     

(3,129)

     

(3,914)

 

Merger-related expenses

   

(8,826)

     

(3,893)

     

(9,951)

     

     

 

Noninterest operating expense

 

$

887,770

     

858,715

     

906,755

     

841,879

     

822,860

 

Merger-related expenses

                                       

Salaries and employee benefits

 

$

60

     

4

     

     

     

 

Equipment and net occupancy

   

1

     

     

     

     

 

Outside data processing and software

   

625

     

244

     

     

     

 

Advertising and marketing

   

505

     

24

     

     

     

 

Printing, postage and supplies

   

730

     

2,049

     

     

     

 

Other costs of operations

   

6,905

     

1,572

     

9,951

     

     

 

Other expense

 

$

8,826

     

3,893

     

9,951

     

     

 

Efficiency ratio

                                       

Noninterest operating expense (numerator)

 

$

887,770

     

858,715

     

906,755

     

841,879

     

822,860

 

Taxable-equivalent net interest income

 

$

970,953

     

946,072

     

985,128

     

993,252

     

947,114

 

Other income

   

569,126

     

513,633

     

505,598

     

551,250

     

520,561

 

Less:  Gain (loss) on bank investment securities

   

291

     

(10,655)

     

(12,282)

     

1,619

     

2,773

 

Denominator

 

$

1,539,788

     

1,470,360

     

1,503,008

     

1,542,883

     

1,464,902

 

Efficiency ratio

   

57.7

%

   

58.4

%

   

60.3

%

   

54.6

%

   

56.2

%

Balance sheet data

                                       

In millions

                                       

Average assets

                                       

Average assets

 

$

154,037

     

150,641

     

148,157

     

144,563

     

140,181

 

Goodwill

   

(4,593)

     

(4,593)

     

(4,593)

     

(4,593)

     

(4,593)

 

Core deposit and other intangible assets

   

(7)

     

(10)

     

(13)

     

(16)

     

(19)

 

Deferred taxes

   

2

     

3

     

3

     

4

     

5

 

Average tangible assets

 

$

149,439

     

146,041

     

143,554

     

139,958

     

135,574

 

Average common equity

                                       

Average total equity

 

$

17,109

     

16,571

     

16,327

     

16,213

     

16,073

 

Preferred stock

   

(1,495)

     

(1,250)

     

(1,250)

     

(1,250)

     

(1,250)

 

Average common equity

   

15,614

     

15,321

     

15,077

     

14,963

     

14,823

 

Goodwill

   

(4,593)

     

(4,593)

     

(4,593)

     

(4,593)

     

(4,593)

 

Core deposit and other intangible assets

   

(7)

     

(10)

     

(13)

     

(16)

     

(19)

 

Deferred taxes

   

2

     

3

     

3

     

4

     

5

 

Average tangible common equity

 

$

11,016

     

10,721

     

10,474

     

10,358

     

10,216

 

At end of quarter

                                       

Total assets

                                       

Total assets

 

$

151,901

     

150,623

     

150,481

     

142,601

     

138,627

 

Goodwill

   

(4,593)

     

(4,593)

     

(4,593)

     

(4,593)

     

(4,593)

 

Core deposit and other intangible assets

   

(6)

     

(9)

     

(12)

     

(14)

     

(17)

 

Deferred taxes

   

2

     

2

     

3

     

4

     

4

 

Total tangible assets

 

$

147,304

     

146,023

     

145,879

     

137,998

     

134,021

 

Total common equity

                                       

Total equity

 

$

17,529

     

16,720

     

16,447

     

16,187

     

16,101

 

Preferred stock

   

(1,750)

     

(1,250)

     

(1,250)

     

(1,250)

     

(1,250)

 

Common equity

   

15,779

     

15,470

     

15,197

     

14,937

     

14,851

 

Goodwill

   

(4,593)

     

(4,593)

     

(4,593)

     

(4,593)

     

(4,593)

 

Core deposit and other intangible assets

   

(6)

     

(9)

     

(12)

     

(14)

     

(17)

 

Deferred taxes

   

2

     

2

     

3

     

4

     

4

 

Total tangible common equity

 

$

11,182

     

10,870

     

10,595

     

10,334

     

10,245

 

__________________

(1)

After any related tax effect.

 

INVESTOR CONTACT:

 

Donald J. MacLeod

   

(716) 842-5138

     

MEDIA CONTACT:

 

Maya Dillon

   

(212) 415-0557

 

M&T Bank Corporation