M&T Bank Corporation (NYSE: MTB) announces fourth quarter and full-year 2023 results

BUFFALO, N.Y., Jan. 18, 2024 -- M&T Bank Corporation ("M&T" or "the Company") reports quarterly net income of $482 million or $2.74 of diluted earnings per common share and full-year net income of $2.74 billion or $15.79 of diluted earnings per common share.

(Dollars in millions, except per share data)

 

4Q23

   

3Q23

   

4Q22

   

2023

   

2022

 

Earnings Highlights

             

Net interest income

 

$

1,722

   

$

1,775

   

$

1,827

   

$

7,115

   

$

5,822

 

Taxable-equivalent adjustment

   

13

     

15

     

14

     

54

     

39

 

Net interest income - taxable-equivalent

   

1,735

     

1,790

     

1,841

     

7,169

     

5,861

 

Provision for credit losses

   

225

     

150

     

90

     

645

     

517

 

Noninterest income

   

578

     

560

     

682

     

2,528

     

2,357

 

Noninterest expense

   

1,450

     

1,278

     

1,408

     

5,379

     

5,050

 

Net income

   

482

     

690

     

765

     

2,741

     

1,992

 

Net income available to common shareholders - diluted

   

457

     

664

     

739

     

2,636

     

1,891

 

Diluted earnings per common share

   

2.74

     

3.98

     

4.29

     

15.79

     

11.53

 

Return on average assets - annualized

   

.92

%

   

1.33

%

   

1.53

%

   

1.33

%

   

1.05

%

Return on average common shareholders' equity - annualized

   

7.41

%

   

10.99

%

   

12.59

%

   

11.06

%

   

8.67

%

Average Balance Sheet

             

Total assets

 

$

208,752

   

$

205,791

   

$

198,592

   

$

205,397

   

$

190,252

 

Interest-bearing deposits at banks

   

30,153

     

26,657

     

25,089

     

26,202

     

33,435

 

Investment securities

   

27,490

     

27,993

     

25,297

     

27,932

     

19,897

 

Loans and leases, net of unearned discount

   

132,770

     

132,617

     

129,406

     

132,738

     

119,297

 

Deposits

   

164,713

     

162,688

     

163,468

     

162,094

     

158,491

 

Borrowings

   

13,057

     

12,585

     

5,385

     

13,054

     

4,376

 

Selected Ratios

             

(Amounts expressed as a percent, except per share data)

                             

Net interest margin

   

3.61

%

   

3.79

%

   

4.06

%

   

3.83

%

   

3.39

%

Efficiency ratio

   

62.1

     

53.7

     

53.3

     

54.9

     

56.6

 

Net charge-offs to average total loans - annualized

   

.44

     

.29

     

.12

     

.33

     

.13

 

Allowance for credit losses to total loans

   

1.59

     

1.55

     

1.46

     

1.59

     

1.46

 

Nonaccrual loans to total loans

   

1.62

     

1.77

     

1.85

     

1.62

     

1.85

 

Common equity Tier 1 ("CET1") capital ratio (1)

   

10.98

     

10.95

     

10.44

     

10.98

     

10.44

 

Common shareholders' equity per share

 

$

150.15

   

$

145.72

   

$

137.68

   

$

150.15

   

$

137.68

 

(1) December 31, 2023 CET1 capital ratio is estimated.

Financial Highlights

  • The CET1 capital ratio increased 3 basis points to an estimated 10.98% at December 31, 2023, compared with 10.95% at September 30, 2023, modestly strengthening the Company's capital position.
  • Net interest margin of 3.61% in the recent quarter narrowed from 3.79% in the third quarter of 2023 reflecting higher costs paid on deposits amidst a continued shift of customer funds to interest-bearing products.
  • Growth in average commercial and industrial loans in the recent quarter was largely offset by a decline in commercial real estate loans.
  • Reflecting continued demand for interest-bearing products, average deposits increased 1% from the third quarter of 2023.
  • Higher provision for credit losses in the recent quarter reflects continued pressure on investor-owned commercial real estate borrowers and a $1.7 billion increase in loan balances from September 30, 2023 to December 31, 2023.
  • Noninterest expense in the fourth quarter of 2023 includes an FDIC special assessment of $197 million ($146 million net of tax or $0.88 of diluted earnings per common share).

Chief Financial Officer Commentary

"M&T enters 2024 with stronger levels of capital, liquidity and credit reserves than a year earlier. Average commercial and consumer loans as well as average deposits all increased in the final quarter of 2023, and expenses remained well controlled after considering the FDIC special assessment. With commercial real estate values and higher interest rates impacting our commercial clientele, our relationship-based approach gives us confidence in our ability to work through those challenges with our customers and appropriately assess the associated credit risk and loss reserves. Over the past year we have strengthened relationships with our customers and welcomed new ones. We thank our employees for consistently showing up within the communities we serve to make a difference."

- Daryl N. Bible, M&T's Chief Financial Officer

Contact: 

   

Investor Relations:

Brian Klock

716.842.5138

Media Relations:

Frank Lentini

929.651.0447

 

 Non-GAAP Measures (1)

 
                               
               

Change
4Q23 vs.

         

Change
4Q23 vs.

 

($ in millions, except per share data)

 

4Q23 

   

3Q23 

   

3Q23 

   

4Q22 

   

4Q22 

 
                               

Net operating income

 

$

494

   

$

702

     

-30

%

 

$

812

     

-39

%

Diluted net operating earnings per common share

 

$

2.81

   

$

4.05

     

-31

%

 

$

4.57

     

-39

%

Annualized return on average tangible assets

   

.98

%

   

1.41

%

         

1.70

%

     

Annualized return on average tangible common equity

   

11.70

%

   

17.41

%

         

21.29

%

     

Efficiency ratio

   

62.1

%

   

53.7

%

         

53.3

%

     

Tangible equity per common share

 

$

98.54

   

$

93.99

     

5

%

 

$

86.59

     

14

%

_______________

(1)  A reconciliation of non-GAAP measures is included in the tables that accompany this release.

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.

Merger-related expenses associated with the People's United Financial, Inc. ("People's United") acquisition in 2022 generally consisted of:

  • Professional services, temporary help fees and other costs associated with actual or planned conversions of systems and/or integration of operations and the introduction of M&T to its new customers.
  • Costs related to terminations of existing contractual arrangements to purchase various services, severance and travel costs.
  • An initial provision for credit losses of $242 million in the second quarter of 2022 on loans not deemed to be purchased credit deteriorated ("PCD") on the April 1, 2022 acquisition date.

The amounts of merger-related expenses in 2022 are presented in the tables that accompany this release. No merger-related expenses were incurred in the year ended December 31, 2023.

For the year ended December 31, 2023, diluted net operating earnings per common share were $16.08, compared with $14.42 in 2022. Net operating income was $2.79 billion and $2.47 billion in 2023 and 2022, respectively. Expressed as an annualized rate of return on average tangible assets and average tangible common shareholders' equity, net operating income in 2023 was 1.42% and 17.60%, respectively, compared with 1.35% and 16.70%, respectively, in 2022. 

 Taxable-equivalent Net Interest Income

 
                               
               

Change
4Q23 vs.

         

Change
4Q23 vs.

 

($ in millions)

 

4Q23 

   

3Q23 

   

3Q23 

   

4Q22 

   

4Q22 

 
                               

Average earning assets

 

$

190,536

   

$

187,403

     

2

%

 

$

179,914

     

6

%

Average interest-bearing liabilities

 

$

127,646

   

$

121,388

     

5

%

 

$

98,635

     

29

%

Net interest income - taxable-equivalent

 

$

1,735

   

$

1,790

     

-3

%

 

$

1,841

     

-6

%

Yield on average earning assets

   

5.73

%

   

5.62

%

         

4.60

%

     

Cost of interest-bearing liabilities

   

3.17

%

   

2.83

%

         

0.98

%

     

Net interest spread

   

2.56

%

   

2.79

%

         

3.62

%

     

Net interest margin

   

3.61

%

   

3.79

%

         

4.06

%

     

Taxable-equivalent net interest income decreased $55 million, or 3%, from the third quarter of 2023.

  • Average interest-bearing deposits increased $5.8 billion and the rates paid on such deposits rose 36 basis points.
  • Average long-term borrowings increased $661 million.
  • The yield on average loans and leases increased 14 basis points.
  • Average interest-bearing deposits at banks increased $3.5 billion.

Taxable-equivalent net interest income decreased $106 million, or 6%, compared with the year-earlier quarter.

  • Average interest-bearing deposits rose $21.3 billion and the rates paid on those deposits increased 210 basis points.
  • Average borrowings increased $7.7 billion.
  • Yields earned on average loans and leases and average interest-bearing deposits at banks increased 121 basis points and 173 basis points, respectively.
  • Average interest-bearing deposits at banks and average loans and leases increased $5.1 billion and $3.4 billion, respectively.
  • The yield on average investment securities increased by 36 basis points.

Taxable-equivalent net interest income was $7.17 billion in 2023, an increase of $1.31 billion, or 22% from $5.86 billion in 2022.

  • Average earning assets increased $14.2 billion to $187.0 billion in 2023 from $172.8 billion in 2022, reflecting the impact of one additional quarter of assets acquired from People's United on April 1, 2022, partially offset by lower average interest-bearing deposits at banks.
  • Yields on average loans and leases and interest-bearing deposits at banks increased 166 basis points and 367 basis points, respectively.
  • Average interest-bearing liabilities increased $25.7 billion also reflecting the impact of one additional quarter of liabilities assumed in the acquisition of People's United.
  • Rates paid on average interest-bearing deposits increased 194 basis points.

 

Provision for Credit Losses/Asset Quality

 
                               
               

Change
4Q23 vs.

         

Change
4Q23 vs.

 

($ in millions)

 

4Q23 

   

3Q23 

   

3Q23 

   

4Q22 

   

4Q22 

 
                               

At end of quarter

                             

Nonaccrual loans

 

$

2,166

   

$

2,342

     

-8

%

 

$

2,439

     

-11

%

Real estate and other foreclosed assets

   

39

     

37

     

4

%

   

41

     

-7

%

Total nonperforming assets

 

$

2,205

   

$

2,379

     

-7

%

 

$

2,480

     

-11

%

Accruing loans past due 90 days or more (1)

 

$

339

   

$

354

     

-4

%

 

$

491

     

-31

%

Nonaccrual loans as % of loans outstanding

   

1.62

%

   

1.77

%

         

1.85

%

     
                               

Allowance for credit losses

 

$

2,129

   

$

2,052

     

4

%

 

$

1,925

     

11

%

Allowance for credit losses as % of loans outstanding

   

1.59

%

   

1.55

%

         

1.46

%

     
                               

For the period

                             

Provision for credit losses

 

$

225

   

$

150

     

50

%

 

$

90

     

150

%

Net charge-offs

 

$

148

   

$

96

     

54

%

 

$

40

     

268

%

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

   

.44

%

   

.29

%

         

.12

%

     

_______________

(1)  Predominantly government-guaranteed residential real estate loans.

M&T recorded a provision for credit losses of $225 million in the fourth quarter of 2023 and $150 million in the immediately preceding quarter, compared with $90 million in the fourth quarter of 2022. The comparatively higher provisions for credit losses in the most recent two quarters as compared with the fourth quarter of 2022 reflect commercial real estate values and higher interest rates contributing to a modest deterioration in the performance of loans to commercial borrowers. The provision for credit losses was $645 million in 2023, compared with $517 million in 2022. As previously described, included in the second quarter of 2022 was the $242 million provision related to loans obtained in the People's United acquisition that were considered non-PCD. Reflective of variability in the timing and amount of commercial real estate charge-offs, net charge-offs totaled $148 million in 2023's fourth quarter as compared with $96 million in the immediately preceding quarter. Net charge-offs were $40 million in the year-earlier quarter. As compared with the year-earlier fourth quarter, the two most recent quarter net charge-offs reflect higher levels of commercial real estate loan and commercial and industrial loan net charge-offs. Net charge-offs were $442 million and $160 million in 2023 and 2022, respectively, representing .33% and .13%, respectively, of average loans outstanding.

Nonaccrual loans were $2.17 billion at December 31, 2023, $176 million lower than at September 30, 2023 and $272 million lower than at December 31, 2022. The lower level of nonaccrual loans at the recent quarter end as compared with the immediately preceding quarter end was attributable to a decline in commercial real estate nonaccrual loans, including the impact of net charge-offs, and residential real estate nonaccrual loans. The decrease in nonaccrual loans at December 31, 2023 as compared with December 31, 2022 was predominantly due to lower levels of commercial real estate nonaccrual loans and residential real estate nonaccrual loans, partially offset by a rise in commercial and industrial nonaccrual loans.

 Noninterest Income

 
                               
               

Change
4Q23 vs.

         

Change
4Q23 vs.

 

($ in millions)

 

4Q23  

   

3Q23  

   

3Q23 

   

4Q22  

   

4Q22 

 

Mortgage banking revenues

 

$

112

   

$

105

     

8

%

 

$

82

     

38

%

Service charges on deposit accounts

   

121

     

121

     

     

106

     

14

%

Trust income

   

159

     

155

     

2

%

   

195

     

-19

%

Brokerage services income

   

26

     

27

     

-3

%

   

22

     

17

%

Trading account and non-hedging derivative gains

   

11

     

9

     

23

%

   

14

     

-18

%

Gain (loss) on bank investment securities

   

4

     

     

     

(4)

     

 

Other revenues from operations

   

145

     

143

     

2

%

   

267

     

-45

%

Total

 

$

578

   

$

560

     

3

%

 

$

682

     

-15

%

Noninterest income in the fourth quarter of 2023 increased $19 million, or 3%, as compared with 2023's third quarter.

  • Mortgage banking revenues increased $8 million reflecting higher margins on sales of commercial real estate loans.
  • Gain (loss) on bank investment securities increased $4 million, which includes unrealized gains on Fannie Mae and Freddie Mac preferred stock and other equity securities.
  • Trust income increased $3 million reflecting improved sales activity.
  • Other revenues from operations rose $3 million resulting from comparatively favorable letter of credit and other credit-related fees.

Noninterest income declined $103 million, or 15%, as compared with the year-earlier fourth quarter.

  • Other revenues from operations declined $121 million due to a $136 million gain on sale of M&T Insurance Agency ("MTIA") in fourth quarter of 2022, partially offset by a rise in tax-exempt income earned from bank owned life insurance and higher letter of credit and other credit-related fees.
  • Trust income decreased $36 million reflecting lower revenues associated with the Company's Collective Investment Trust ("CIT") business following its sale in April 2023.
  • Mortgage banking revenues rose $31 million due to higher servicing income related to the bulk purchase of residential real estate loan servicing rights in the first quarter of 2023 and higher gains on sales of commercial and residential real estate loans.
  • Service charges on deposit accounts increased $15 million predominantly due to People's United conversion-related fee waivers in the fourth quarter of 2022 and a rise in commercial service charges.

Noninterest income rose $172 million, or 7%, to $2.53 billion in 2023 as compared with $2.36 billion in 2022, reflecting the sale of the CIT business in the second quarter of 2023, the sale of MTIA in the fourth quarter of 2022 and one additional quarter of revenues in 2023 from operations acquired from People's United. Other favorable factors contributing to the rise in noninterest income included higher mortgage banking revenues and trading account and non-hedging derivatives gains.

 Noninterest Expense

 
                               
               

Change
4Q23 vs.

         

Change
4Q23 vs.

 

($ in millions)

 

4Q23

   

3Q23

   

3Q23

   

4Q22

   

4Q22

 

Salaries and employee benefits

 

$

724

   

$

727

     

   

$

697

     

4

%

Equipment and net occupancy

   

134

     

131

     

2

%

   

137

     

-2

%

Outside data processing and software

   

114

     

111

     

3

%

   

108

     

6

%

Professional and other services

   

99

     

89

     

12

%

   

145

     

-32

%

FDIC assessments

   

228

     

29

     

676

%

   

24

     

849

%

Advertising and marketing

   

26

     

23

     

11

%

   

32

     

-22

%

Amortization of core deposit and other intangible assets

   

15

     

15

     

     

18

     

-15

%

Other costs of operations

   

110

     

153

     

-28

%

   

247

     

-55

%

Total

 

$

1,450

   

$

1,278

     

14

%

 

$

1,408

     

3

%

In the fourth quarter of 2023, the Company began presenting "professional and other services" as an individual component of "other expense" while combining the presentation of "printing, postage, and supplies" into "other costs of operations" within the Consolidated Statement of Income. Prior periods were reclassified to conform to the current presentation.

Noninterest expense aggregated $1.45 billion in the recent quarter, up from $1.28 billion in the third quarter of 2023. Excluding the amortization of core deposit and other intangible assets considered to be nonoperating in nature, noninterest operating expenses increased $173 million, or 14%, to $1.44 billion in the recent quarter from $1.26 billion in the immediately preceding quarter.

  • Fourth quarter of 2023 expenses include a $197 million special assessment from the FDIC.
  • Professional and other services operating expenses rose $10 million reflecting lower legal-related expenses in 2023's third quarter.
  • Other costs of operations decreased $43 million reflecting losses associated with certain retail banking activities recognized in the third quarter of 2023 and lower merchant discount and credit card fees.

Noninterest expense increased $42 million from the fourth quarter of 2022. Noninterest operating expenses aggregated $1.35 billion in the fourth quarter of 2022 after excluding $45 million of merger-related expenses, considered to be nonoperating in nature, associated with the People's United acquisition and $18 million of amortization of core deposit and other intangible assets. Noninterest operating expenses increased $90 million, or 7%, from the year-earlier quarter inclusive of the following:

  • FDIC assessments increased $204 million reflecting the $197 million FDIC special assessment.
  • Other costs of operations decreased $122 million reflecting a $135 million charitable contribution to The M&T Charitable Foundation in the year-earlier quarter.
  • Salaries and employee benefits expenses increased $31 million reflecting higher severance and other employee benefits expenses.
  • Professional and other services operating expenses declined $30 million including lower sub-advisory fees resulting from the sale of the CIT business.

For the year ended December 31, 2023, noninterest expense aggregated $5.38 billion, compared with $5.05 billion in 2022. Noninterest operating expenses were $5.32 billion in 2023, compared with $4.66 billion in 2022 after excluding $338 million of merger-related expenses, considered to be nonoperating in nature, incurred in 2022 associated with the People's United acquisition and $62 million and $56 million of amortization of core deposit and other intangible assets in 2023 and 2022, respectively. The $661 million increase in noninterest operating expenses reflected one additional quarter of operations acquired from People's United, higher salaries and employee benefits expenses from merit and other salary increases, a rise in incentive compensation and increases in employee benefits costs, including severance, and higher FDIC assessments inclusive of the special assessment in the recent quarter.

 Average Earning Assets

 
                               
               

Change
4Q23 vs.

         

Change
4Q23 vs.

 

($ in millions)

 

4Q23

   

3Q23

   

3Q23

   

4Q22

   

4Q22

 

Interest-bearing deposits at banks

 

$

30,153

   

$

26,657

     

13

%

 

$

25,089

     

20

%

Trading account

   

123

     

136

     

-10

%

   

122

     

1

%

Investment securities

   

27,490

     

27,993

     

-2

%

   

25,297

     

9

%

Loans and leases, net of unearned discount

                             

Commercial and industrial

   

55,420

     

54,567

     

2

%

   

49,955

     

11

%

Real estate - commercial

   

33,455

     

34,288

     

-2

%

   

35,773

     

-6

%

Real estate - consumer

   

23,339

     

23,573

     

-1

%

   

23,334

     

 

Consumer

   

20,556

     

20,189

     

2

%

   

20,344

     

1

%

Total loans and leases, net

   

132,770

     

132,617

     

     

129,406

     

3

%

Total earning assets

 

$

190,536

   

$

187,403

     

2

%

 

$

179,914

     

6

%

At December 31, 2023, the Company reclassified the substantial majority of its loans secured by commercial real estate that were considered owner-occupied to commercial and industrial loans to reflect the variation in the management and underlying risk profile of such loans as compared with investor-owned commercial real estate loans. Prior periods were reclassified to conform to the current presentation.

Average earning assets increased $3.1 billion, or 2%, from the third quarter of 2023.

  • Average interest-bearing deposits at banks increased $3.5 billion due to increased liquidity from a rise in average deposits and higher levels of borrowings.
  • Average loans and leases increased a modest $153 million primarily reflective of growth in average balances of commercial and industrial loans and consumer loans, largely offset by a decline in average commercial real estate and residential real estate loans. The growth in commercial and industrial loans was mainly attributable to financial and insurance industry customers and motor vehicle and recreational finance dealers.
  • Average investment securities declined $503 million primarily due to pay downs of fixed rate mortgage-backed securities.

Average earning assets increased $10.6 billion, or 6%, from the year-earlier fourth quarter.

  • Average interest-bearing deposits at banks increased $5.1 billion due to increased liquidity from a rise in average deposits and higher levels of borrowings.
  • Average loans and leases increased $3.4 billion predominantly due to higher average balances of commercial and industrial loans reflecting lending activities to financial and insurance industry customers and motor vehicle and recreational finance dealers, partially offset by a $2.3 billion decline in average commercial real estate loans.
  • Average investment securities increased $2.2 billion due to the purchases of additional investment securities in the fourth quarter of 2022 and the first quarter of 2023.

 

 Average Interest-bearing Liabilities

 
                               
               

Change
4Q23 vs.

         

Change
4Q23 vs.

 

($ in millions)

 

4Q23

   

3Q23

   

3Q23

   

4Q22

   

4Q22

 

Interest-bearing deposits

                             

Savings and interest-checking deposits

 

$

93,365

   

$

89,274

     

5

%

 

$

87,068

     

7

%

Time deposits

   

21,224

     

19,528

     

9

%

   

6,182

     

243

%

Total interest-bearing deposits

   

114,589

     

108,802

     

5

%

   

93,250

     

23

%

Short-term borrowings

   

5,156

     

5,346

     

-4

%

   

1,632

     

216

%

Long-term borrowings

   

7,901

     

7,240

     

9

%

   

3,753

     

111

%

Total interest-bearing liabilities

 

$

127,646

   

$

121,388

     

5

%

 

$

98,635

     

29

%

Average interest-bearing liabilities increased $6.3 billion, or 5%, from the third quarter of 2023.

  • Average interest-bearing deposits increased $5.8 billion, including a $4.8 billion increase in average non-brokered deposits.
  • Average borrowings increased $472 million predominantly due to the issuance of medium-term senior notes totaling $1.0 billion in the fourth quarter of 2023, partially offset by modestly lower levels of average short-term borrowings from the Federal Home Loan Bank ("FHLB") of New York.

Average interest-bearing liabilities increased $29.0 billion, or 29%, from the fourth quarter of 2022.

  • Average interest-bearing deposits rose $21.3 billion, including an $11.6 billion increase in average non-brokered deposits.
  • Average borrowings increased $7.7 billion reflecting the issuances of senior notes totaling $3.5 billion and $1.0 billion in the first and fourth quarters of 2023, respectively, and increases in short-term borrowings from the FHLB of New York.

 

 Capital

 
                   
   

4Q23 

   

3Q23 

   

4Q22 

 

CET1

   

10.98

%

(1)

 

10.95

%

   

10.44

%

Tier 1 capital

   

12.29

%

(1)

 

12.27

%

   

11.79

%

Total capital

   

13.99

%

(1)

 

13.99

%

   

13.60

%

Tangible capital – common

   

8.20

%

   

7.78

%

   

7.63

%

_______________

(1)  December 31, 2023 capital ratios are estimated.

M&T's capital ratios remained well above the minimum set forth by regulatory requirements. Cash dividends declared on M&T's common and preferred stock totaled $217 million and $25 million, respectively, for the quarter ended December 31, 2023. M&T did not repurchase any shares of its common stock in the fourth quarter of 2023.

The CET1 capital ratio for M&T was estimated at 10.98% as of December 31, 2023. M&T's total risk-weighted assets at December 31, 2023 are estimated to be $154 billion.

M&T repurchased 3,838,157 shares of its common stock in accordance with its capital plan during the first quarter of 2023 for a total cost, including the share repurchase excise tax, of $600 million. There were no other share repurchases in 2023. M&T repurchased a total of 10,453,282 shares for a total cost of $1.8 billion in 2022.

Other

In the fourth quarter of 2023 the Company completed modifications to its management reporting system to conform its internal profitability reporting with certain organizational changes that resulted in the realignment of its business operations into three reportable segments: Commercial Bank, Retail Bank and Institutional Services and Wealth Management. The change will be reflected in the Company's upcoming Annual Report on Form 10-K filing for the year ended December 31, 2023.

Conference Call

Investors will have an opportunity to listen to M&T's conference call to discuss fourth quarter financial results today at 10:00 a.m. Eastern Time. Those wishing to participate in the call may dial (800) 347-7315. International participants, using any applicable international calling codes, may dial (785) 424-1755. Callers should reference M&T Bank Corporation or the conference ID #MTBQ423. 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 Thursday January 25, 2024 by calling (800) 839-2485, or (402) 220-7222 for international participants. No conference ID or passcode 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, provides banking products and services in 12 states across the eastern U.S. from Maine to Virginia and Washington, D.C. Trust-related services are provided in select markets in the U.S. and abroad by M&T's Wilmington Trust-affiliated companies and by M&T Bank. For more information on M&T Bank, visit www.mtb.com.

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 events or factors specific to M&T and/or the financial industry as a whole, as well as national and global events generally, on M&T's business, financial condition, liquidity and results of operations may constitute forward-looking statements. Such statements 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.

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 which are difficult to predict and may cause actual outcomes to differ materially from what is expressed or forecast.

While there can be no assurance that any list of risks and uncertainties is complete, important factors that could cause actual outcomes and results to differ materially from those contemplated by forward-looking statements include the following, without limitation: economic conditions and growth rates, including inflation and market volatility; events and developments in the financial services industry, including industry conditions; changes in interest rates, spreads on earning assets and interest-bearing liabilities, and interest rate sensitivity; prepayment speeds, loan originations, loan concentrations by type and industry, credit losses and market values on loans, collateral securing loans, and other assets; sources of liquidity; levels of client deposits; ability to contain costs and expenses; changes in the Company's credit ratings; the impact of the People's United acquisition; domestic or international political developments and other geopolitical events, including international conflicts and hostilities; changes and trends in the securities markets; common shares outstanding and 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; federal, state or local legislation and/or regulations affecting the financial services industry, or M&T and its subsidiaries individually or collectively, including tax policy; regulatory supervision and oversight, including monetary policy and capital requirements; governmental and public policy changes; political conditions, either nationally or in the states in which M&T and its subsidiaries do business; the outcome of pending and future litigation and governmental proceedings, including tax-related examinations and other matters; 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; 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; protection and validity of intellectual property rights; reliance on large customers; technological, implementation and cost/financial risks in large, multi-year contracts; 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, divestment 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 factors that could affect the outcome of the forward-looking statements. In addition, as noted, 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, and other factors.

M&T provides further detail regarding these risks and uncertainties in its Form 10-K for the year ended December 31, 2022, 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 assumes no duty and does not undertake to update forward-looking statements.

Financial Highlights

 
 

Three months ended

         

Year ended

       
 

December 31

         

December 31

       

Dollars in millions, except per share, shares in thousands

2023

   

2022

   

Change 

   

2023

   

2022

   

Change 

 

Performance

                                 

Net income

$

482

     

765

     

-37

%

 

$

2,741

     

1,992

     

38

%

Net income available to common shareholders

 

457

     

739

     

-38

%

   

2,636

     

1,891

     

39

%

Per common share:

                                 

Basic earnings

$

2.75

     

4.32

     

-36

%

 

$

15.85

     

11.59

     

37

%

Diluted earnings

 

2.74

     

4.29

     

-36

%

   

15.79

     

11.53

     

37

%

Cash dividends

 

1.30

     

1.20

     

8

%

   

5.20

     

4.80

     

8

%

Common shares outstanding:

                                 

Average - diluted (1)

 

166,731

     

172,149

     

-3

%

   

167,002

     

164,030

     

2

%

Period end (2)

 

166,149

     

169,285

     

-2

%

   

166,149

     

169,285

     

-2

%

Return on (annualized):

                                 

Average total assets

 

.92

%

   

1.53

%

         

1.33

%

   

1.05

%

     

Average common shareholders' equity

 

7.41

%

   

12.59

%

         

11.06

%

   

8.67

%

     

Taxable-equivalent net interest income

$

1,735

     

1,841

     

-6

%

 

$

7,169

     

5,861

     

22

%

Yield on average earning assets

 

5.73

%

   

4.60

%

         

5.50

%

   

3.64

%

     

Cost of interest-bearing liabilities

 

3.17

%

   

.98

%

         

2.60

%

   

.45

%

     

Net interest spread

 

2.56

%

   

3.62

%

         

2.90

%

   

3.19

%

     

Contribution of interest-free funds

 

1.05

%

   

.44

%

         

.93

%

   

.20

%

     

Net interest margin

 

3.61

%

   

4.06

%

         

3.83

%

   

3.39

%

     

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

 

.44

%

   

.12

%

         

.33

%

   

.13

%

     

Net operating results (3)

                                 

Net operating income

$

494

     

812

     

-39

%

 

$

2,789

     

2,466

     

13

%

Diluted net operating earnings per common share

 

2.81

     

4.57

     

-39

%

   

16.08

     

14.42

     

12

%

Return on (annualized):

                                 

Average tangible assets

 

.98

%

   

1.70

%

         

1.42

%

   

1.35

%

     

Average tangible common equity

 

11.70

%

   

21.29

%

         

17.60

%

   

16.70

%

     

Efficiency ratio

 

62.1

%

   

53.3

%

         

54.9

%

   

56.6

%

     
                                   
 

At December 31

                     

Loan quality

2023

   

2022

   

Change 

                   

Nonaccrual loans

$

2,166

     

2,439

     

-11

%

                 

Real estate and other foreclosed assets

 

39

     

41

     

-7

%

                 

Total nonperforming assets

$

2,205

     

2,480

     

-11

%

                 

Accruing loans past due 90 days or more (4)

$

339

     

491

     

-31

%

                 

Government guaranteed loans included in totals above:

                                 

Nonaccrual loans

$

53

     

44

     

22

%

                 

Accruing loans past due 90 days or more

 

298

     

363

     

-18

%

                 

Nonaccrual loans to total net loans

 

1.62

%

   

1.85

%

                       

Allowance for credit losses to total loans

 

1.59

%

   

1.46

%

                       

_______________

(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

 
 

December 31,

   

September 30,

   

June 30,

   

March 31,

   

December 31,

 

Dollars in millions, except per share, shares in thousands

2023

   

2023

   

2023

   

2023

   

2022

 

Performance

                           

Net income

$

482

     

690

     

867

     

702

     

765

 

Net income available to common shareholders

 

457

     

664

     

841

     

676

     

739

 

Per common share:

                           

Basic earnings

$

2.75

     

4.00

     

5.07

     

4.03

     

4.32

 

Diluted earnings

 

2.74

     

3.98

     

5.05

     

4.01

     

4.29

 

Cash dividends

 

1.30

     

1.30

     

1.30

     

1.30

     

1.20

 

Common shares outstanding:

                           

Average - diluted (1)

 

166,731

     

166,570

     

166,320

     

168,410

     

172,149

 

Period end (2)

 

166,149

     

165,970

     

165,894

     

165,865

     

169,285

 

Return on (annualized):

                           

Average total assets

 

.92

%

   

1.33

%

   

1.70

%

   

1.40

%

   

1.53

%

Average common shareholders' equity

 

7.41

%

   

10.99

%

   

14.27

%

   

11.74

%

   

12.59

%

Taxable-equivalent net interest income

$

1,735

     

1,790

     

1,813

     

1,832

     

1,841

 

Yield on average earning assets

 

5.73

%

   

5.62

%

   

5.46

%

   

5.16

%

   

4.60

%

Cost of interest-bearing liabilities

 

3.17

%

   

2.83

%

   

2.43

%

   

1.86

%

   

.98

%

Net interest spread

 

2.56

%

   

2.79

%

   

3.03

%

   

3.30

%

   

3.62

%

Contribution of interest-free funds

 

1.05

%

   

1.00

%

   

.88

%

   

.74

%

   

.44

%

Net interest margin

 

3.61

%

   

3.79

%

   

3.91

%

   

4.04

%

   

4.06

%

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

 

.44

%

   

.29

%

   

.38

%

   

.22

%

   

.12

%

Net operating results (3)

                           

Net operating income

$

494

     

702

     

879

     

715

     

812

 

Diluted net operating earnings per common share

 

2.81

     

4.05

     

5.12

     

4.09

     

4.57

 

Return on (annualized):

                           

Average tangible assets

 

.98

%

   

1.41

%

   

1.80

%

   

1.49

%

   

1.70

%

Average tangible common equity

 

11.70

%

   

17.41

%

   

22.73

%

   

19.00

%

   

21.29

%

Efficiency ratio

 

62.1

%

   

53.7

%

   

48.9

%

   

55.5

%

   

53.3

%

                             
 

December 31,

   

September 30,

   

June 30,

   

March 31,

   

December 31,

 

Loan quality

2023

   

2023

   

2023

   

2023

   

2022

 

Nonaccrual loans

$

2,166

     

2,342

     

2,435

     

2,557

     

2,439

 

Real estate and other foreclosed assets

 

39

     

37

     

43

     

44

     

41

 

Total nonperforming assets

$

2,205

     

2,379

     

2,478

     

2,601

     

2,480

 

Accruing loans past due 90 days or more (4)

$

339

     

354

     

380

     

407

     

491

 

Government guaranteed loans included in totals above:

                           

Nonaccrual loans

$

53

     

40

     

40

     

42

     

44

 

Accruing loans past due 90 days or more

 

298

     

269

     

294

     

306

     

363

 

Nonaccrual loans to total net loans

 

1.62

%

   

1.77

%

   

1.83

%

   

1.92

%

   

1.85

%

Allowance for credit losses to total loans

 

1.59

%

   

1.55

%

   

1.50

%

   

1.49

%

   

1.46

%

_______________

(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

         

Year ended

       
   

December 31

         

December 31

       

Dollars in millions

 

2023

   

2022

   

Change

   

2023

   

2022

   

Change

 

Interest income

 

$

2,740

     

2,072

     

32

%

 

$

10,224

     

6,247

     

64

%

Interest expense

   

1,018

     

245

     

316

     

3,109

     

425

     

631

 

Net interest income

   

1,722

     

1,827

     

-6

     

7,115

     

5,822

     

22

 

Provision for credit losses

   

225

     

90

     

150

     

645

     

517

     

25

 

Net interest income after provision for credit losses

   

1,497

     

1,737

     

-14

     

6,470

     

5,305

     

22

 

Other income

                                   

Mortgage banking revenues

   

112

     

82

     

38

     

409

     

357

     

15

 

Service charges on deposit accounts

   

121

     

106

     

14

     

475

     

447

     

6

 

Trust income

   

159

     

195

     

-19

     

680

     

741

     

-8

 

Brokerage services income

   

26

     

22

     

17

     

102

     

88

     

17

 

Trading account and non-hedging
     derivative gains

   

11

     

14

     

-18

     

49

     

27

     

84

 

Gain (loss) on bank investment securities

   

4

     

(4)

     

     

4

     

(6)

     

 

Other revenues from operations

   

145

     

267

     

-45

     

809

     

703

     

15

 

Total other income

   

578

     

682

     

-15

     

2,528

     

2,357

     

7

 

Other expense

                                   

Salaries and employee benefits

   

724

     

697

     

4

     

2,997

     

2,787

     

8

 

Equipment and net occupancy

   

134

     

137

     

-2

     

520

     

474

     

10

 

Outside data processing and software

   

114

     

108

     

6

     

437

     

376

     

16

 

Professional and other services

   

99

     

145

     

-32

     

413

     

509

     

-19

 

FDIC assessments

   

228

     

24

     

849

     

315

     

90

     

249

 

Advertising and marketing

   

26

     

32

     

-22

     

108

     

90

     

19

 

Amortization of core deposit and other
     intangible assets

   

15

     

18

     

-15

     

62

     

56

     

12

 

Other costs of operations

   

110

     

247

     

-55

     

527

     

668

     

-21

 

Total other expense

   

1,450

     

1,408

     

3

     

5,379

     

5,050

     

7

 

Income before income taxes

   

625

     

1,011

     

-38

     

3,619

     

2,612

     

39

 

Applicable income taxes

   

143

     

246

     

-42

     

878

     

620

     

42

 

Net income

 

$

482

     

765

     

-37

%

 

$

2,741

     

1,992

     

38

%

 

Condensed Consolidated Statement of Income, Five Quarter Trend

 
   

Three months ended

 
   

December 31,

   

September 30,

   

June 30,

   

March 31,

   

December 31,

 

Dollars in millions

 

2023

   

2023

   

2023

   

2023

   

2022

 

Interest income

 

$

2,740

     

2,641

     

2,516

     

2,327

     

2,072

 

Interest expense

   

1,018

     

866

     

717

     

509

     

245

 

Net interest income

   

1,722

     

1,775

     

1,799

     

1,818

     

1,827

 

Provision for credit losses

   

225

     

150

     

150

     

120

     

90

 

Net interest income after provision for credit losses

   

1,497

     

1,625

     

1,649

     

1,698

     

1,737

 

Other income

                             

Mortgage banking revenues

   

112

     

105

     

107

     

85

     

82

 

Service charges on deposit accounts

   

121

     

121

     

119

     

113

     

106

 

Trust income

   

159

     

155

     

172

     

194

     

195

 

Brokerage services income

   

26

     

27

     

25

     

24

     

22

 

Trading account and non-hedging
     derivative gains

   

11

     

9

     

17

     

12

     

14

 

Gain (loss) on bank investment securities

   

4

     

     

1

     

     

(4)

 

Other revenues from operations

   

145

     

143

     

362

     

159

     

267

 

Total other income

   

578

     

560

     

803

     

587

     

682

 

Other expense

                             

Salaries and employee benefits

   

724

     

727

     

738

     

808

     

697

 

Equipment and net occupancy

   

134

     

131

     

129

     

127

     

137

 

Outside data processing and software

   

114

     

111

     

106

     

106

     

108

 

Professional and other services

   

99

     

89

     

100

     

125

     

145

 

FDIC assessments

   

228

     

29

     

28

     

30

     

24

 

Advertising and marketing

   

26

     

23

     

28

     

31

     

32

 

Amortization of core deposit and other
     intangible assets

   

15

     

15

     

15

     

17

     

18

 

Other costs of operations

   

110

     

153

     

149

     

115

     

247

 

Total other expense

   

1,450

     

1,278

     

1,293

     

1,359

     

1,408

 

Income before income taxes

   

625

     

907

     

1,159

     

926

     

1,011

 

Applicable income taxes

   

143

     

217

     

292

     

224

     

246

 

Net income

 

$

482

     

690

     

867

     

702

     

765

 

 

Condensed Consolidated Balance Sheet

 
   

December 31

         

Dollars in millions

 

2023

   

2022

   

Change  

   

ASSETS

                   

Cash and due from banks

 

$

1,731

     

1,517

     

14

 

%

Interest-bearing deposits at banks

   

28,069

     

24,959

     

12

   

Federal funds sold and agreements to resell securities

   

     

3

     

-100

   

Trading account

   

106

     

118

     

-10

   

Investment securities

   

26,897

     

25,211

     

7

   

Loans and leases:

                   

Commercial and industrial

   

57,010

     

51,919

     

10

   

Real estate - commercial

   

33,003

     

35,296

     

-6

   

Real estate - consumer

   

23,264

     

23,756

     

-2

   

Consumer

   

20,791

     

20,593

     

1

   

Total loans and leases, net of unearned discount

   

134,068

     

131,564

     

2

   

Less: allowance for credit losses

   

2,129

     

1,925

     

11

   

Net loans and leases

   

131,939

     

129,639

     

2

   

Goodwill

   

8,465

     

8,490

     

   

Core deposit and other intangible assets

   

147

     

209

     

-30

   

Other assets

   

10,910

     

10,584

     

3

   

Total assets

 

$

208,264

     

200,730

     

4

 

%

                     

LIABILITIES AND SHAREHOLDERS' EQUITY

                   

Noninterest-bearing deposits

 

$

49,294

     

65,502

     

-25

 

%

Interest-bearing deposits

   

113,980

     

98,013

     

16

   

Total deposits

   

163,274

     

163,515

     

   

Short-term borrowings

   

5,316

     

3,555

     

50

   

Accrued interest and other liabilities

   

4,516

     

4,377

     

3

   

Long-term borrowings

   

8,201

     

3,965

     

107

   

Total liabilities

   

181,307

     

175,412

     

3

   

Shareholders' equity:

                   

Preferred

   

2,011

     

2,011

     

   

Common

   

24,946

     

23,307

     

7

   

Total shareholders' equity

   

26,957

     

25,318

     

6

   

Total liabilities and shareholders' equity

 

$

208,264

     

200,730

     

4

 

%

                     
                     
                     

SUMMARY OF RECLASSIFICATION OF OWNER-OCCUPIED LOANS

Commercial and industrial previously reported

       

$

41,850

         

Reclassification of certain owner-occupied loans

         

10,069

         

Commercial and industrial after reclassification

       

$

51,919

         
                     

Real estate - commercial previously reported

       

$

45,365

         

Reclassification of certain owner-occupied loans

         

(10,069)

         

Real estate - commercial after reclassification

       

$

35,296

         

 

Condensed Consolidated Balance Sheet, Five Quarter Trend

 
 

December 31,

   

September 30,

   

June 30,

   

March 31,

   

December 31,

 

Dollars in millions

2023

   

2023

   

2023

   

2023

   

2022

 

ASSETS

                           

Cash and due from banks

$

1,731

     

1,769

     

1,848

     

1,818

     

1,517

 

Interest-bearing deposits at banks

 

28,069

     

30,114

     

27,107

     

22,306

     

24,959

 

Federal funds sold and agreements to resell securities

 

     

     

     

     

3

 

Trading account

 

106

     

137

     

137

     

165

     

118

 

Investment securities

 

26,897

     

27,336

     

27,917

     

28,443

     

25,211

 

Loans and leases:

                           

Commercial and industrial

 

57,010

     

54,891

     

54,699

     

53,934

     

51,919

 

Real estate - commercial

 

33,003

     

33,741

     

34,634

     

34,897

     

35,296

 

Real estate - consumer

 

23,264

     

23,448

     

23,762

     

23,790

     

23,756

 

Consumer

 

20,791

     

20,275

     

20,249

     

20,317

     

20,593

 

Total loans and leases, net of unearned discount

 

134,068

     

132,355

     

133,344

     

132,938

     

131,564

 

Less: allowance for credit losses

 

2,129

     

2,052

     

1,998

     

1,975

     

1,925

 

Net loans and leases

 

131,939

     

130,303

     

131,346

     

130,963

     

129,639

 

Goodwill

 

8,465

     

8,465

     

8,465

     

8,490

     

8,490

 

Core deposit and other intangible assets

 

147

     

162

     

177

     

192

     

209

 

Other assets

 

10,910

     

10,838

     

10,675

     

10,579

     

10,584

 

Total assets

$

208,264

     

209,124

     

207,672

     

202,956

     

200,730

 
                             

LIABILITIES AND SHAREHOLDERS' EQUITY

                           

Noninterest-bearing deposits

$

49,294

     

53,787

     

54,938

     

59,955

     

65,502

 

Interest-bearing deposits

 

113,980

     

110,341

     

107,120

     

99,120

     

98,013

 

Total deposits

 

163,274

     

164,128

     

162,058

     

159,075

     

163,515

 

Short-term borrowings

 

5,316

     

6,731

     

7,908

     

6,995

     

3,555

 

Accrued interest and other liabilities

 

4,516

     

4,946

     

4,488

     

4,046

     

4,377

 

Long-term borrowings

 

8,201

     

7,123

     

7,417

     

7,463

     

3,965

 

Total liabilities

 

181,307

     

182,928

     

181,871

     

177,579

     

175,412

 

Shareholders' equity:

                           

Preferred

 

2,011

     

2,011

     

2,011

     

2,011

     

2,011

 

Common

 

24,946

     

24,185

     

23,790

     

23,366

     

23,307

 

Total shareholders' equity

 

26,957

     

26,196

     

25,801

     

25,377

     

25,318

 

Total liabilities and shareholders' equity

$

208,264

     

209,124

     

207,672

     

202,956

     

200,730

 
                             
                             
                             

SUMMARY OF RECLASSIFICATION OF OWNER-OCCUPIED LOANS

 

Commercial and industrial previously reported

     

$

45,058

     

44,684

     

43,758

     

41,850

 

Reclassification of certain owner-occupied loans

       

9,833

     

10,015

     

10,176

     

10,069

 

Commercial and industrial after reclassification

     

$

54,891

     

54,699

     

53,934

     

51,919

 
                             

Real estate - commercial previously reported

     

$

43,574

     

44,649

     

45,073

     

45,365

 

Reclassification of certain owner-occupied loans

       

(9,833)

     

(10,015)

     

(10,176)

     

(10,069)

 

Real estate - commercial after reclassification

     

$

33,741

     

34,634

     

34,897

     

35,296

 

 

Condensed Consolidated Average Balance Sheet and Annualized Taxable-equivalent Rates

 
     

Three months ended

     

Change in balance

     

Year ended

           
     

December 31,

     

September 30,

     

December 31,

     

December 31, 2023 from

     

December 31,

     

Change

   

Dollars in millions

   

2023

     

2023

     

2022

     

September 30,

     

December 31,

     

2023

     

2022

     

in

   
     

Balance 

     

Rate 

     

Balance 

     

Rate 

     

Balance 

     

Rate 

     

2023

     

2022

     

Balance 

     

Rate 

     

Balance 

     

Rate 

     

balance 

   

ASSETS

                                                                                                         

Interest-bearing deposits at banks

 

$

30,153

     

5.48

 

%

 

26,657

     

5.40

 

%

 

25,089

     

3.75

 

%

 

13

 

%

 

20

 

%

$

26,202

     

5.19

 

%

 

33,435

     

1.52

 

%

 

-22

 

%

Federal funds sold and agreements to
     resell securities

   

     

5.79

     

     

5.79

     

     

4.32

     

     

-78

     

     

5.39

     

70

     

.43

     

-100

   

Trading account

   

123

     

3.80

     

136

     

4.05

     

122

     

2.13

     

-10

     

1

     

133

     

3.20

     

109

     

1.49

     

21

   

Investment securities

   

27,490

     

3.13

     

27,993

     

3.14

     

25,297

     

2.77

     

-2

     

9

     

27,932

     

3.09

     

19,897

     

2.59

     

40

   

Loans and leases, net of unearned discount

                                                                               

Commercial and industrial

   

55,420

     

7.01

     

54,567

     

6.86

     

49,955

     

5.65

     

2

     

11

     

54,271

     

6.71

     

44,127

     

4.62

     

23

   

Real estate - commercial

   

33,455

     

6.54

     

34,288

     

6.50

     

35,773

     

5.04

     

-2

     

-6

     

34,473

     

6.33

     

34,375

     

4.35

     

   

Real estate - consumer

   

23,339

     

4.25

     

23,573

     

4.14

     

23,334

     

3.92

     

-1

     

     

23,614

     

4.11

     

21,257

     

3.75

     

11

   

Consumer

   

20,556

     

6.42

     

20,189

     

6.16

     

20,344

     

5.28

     

2

     

1

     

20,380

     

6.03

     

19,538

     

4.65

     

4

   

Total loans and leases, net

   

132,770

     

6.33

     

132,617

     

6.19

     

129,406

     

5.12

     

     

3

     

132,738

     

6.07

     

119,297

     

4.41

     

11

   

Total earning assets

   

190,536

     

5.73

     

187,403

     

5.62

     

179,914

     

4.60

     

2

     

6

     

187,005

     

5.50

     

172,808

     

3.64

     

8

   

Goodwill

   

8,465

           

8,465

           

8,494

           

     

     

8,473

           

7,537

           

12

   

Core deposit and other intangible assets

   

154

           

170

           

218

           

-9

     

-29

     

177

           

179

           

-1

   

Other assets

   

9,597

           

9,753

           

9,966

           

-2

     

-4

     

9,742

           

9,728

           

   

Total assets

 

$

208,752

           

205,791

           

198,592

           

1

 

%

 

5

 

%

$

205,397

           

190,252

           

8

 

%

                                                                                 

LIABILITIES AND SHAREHOLDERS' EQUITY

                                                                               

Interest-bearing deposits

                                                                               

Savings and interest-checking deposits

 

$

93,365

     

2.58

     

89,274

     

2.20

     

87,068

     

.76

     

5

 

%

 

7

 

%

$

89,489

     

1.95

     

84,753

     

.32

     

6

 

%

Time deposits

   

21,224

     

4.30

     

19,528

     

4.09

     

6,182

     

1.29

     

9

     

243

     

17,131

     

3.92

     

4,850

     

.49

     

253

   

Total interest-bearing deposits

   

114,589

     

2.90

     

108,802

     

2.54

     

93,250

     

.80

     

5

     

23

     

106,620

     

2.27

     

89,603

     

.33

     

19

   

Short-term borrowings

   

5,156

     

5.27

     

5,346

     

5.16

     

1,632

     

3.24

     

-4

     

216

     

5,758

     

5.07

     

936

     

2.08

     

515

   

Long-term borrowings

   

7,901

     

5.70

     

7,240

     

5.52

     

3,753

     

4.65

     

9

     

111

     

7,296

     

5.49

     

3,440

     

3.23

     

112

   

Total interest-bearing liabilities

   

127,646

     

3.17

     

121,388

     

2.83

     

98,635

     

.98

     

5

     

29

     

119,674

     

2.60

     

93,979

     

.45

     

27

   

Noninterest-bearing deposits

   

50,124

           

53,886

           

70,218

           

-7

     

-29

     

55,474

           

68,888

           

-19

   

Other liabilities

   

4,482

           

4,497

           

4,393

           

     

2

     

4,350

           

3,575

           

22

   

Total liabilities

   

182,252

           

179,771

           

173,246

           

1

     

5

     

179,498

           

166,442

           

8

   

Shareholders' equity

   

26,500

           

26,020

           

25,346

           

2

     

5

     

25,899

           

23,810

           

9

   

Total liabilities and shareholders' equity

 

$

208,752

           

205,791

           

198,592

           

1

 

%

 

5

 

%

$

205,397

           

190,252

           

8

 

%

                                                                                 

Net interest spread

         

2.56

           

2.79

           

3.62

                       

2.90

           

3.19

         

Contribution of interest-free funds

         

1.05

           

1.00

           

.44

                       

.93

           

.20

         

Net interest margin

         

3.61

 

%

       

3.79

 

%

       

4.06

 

%

                   

3.83

 

%

       

3.39

 

%

     
                                                                                 
                                                                                 
                                                                                 

SUMMARY OF RECLASSIFICATION OF OWNER-OCCUPIED LOANS

Commercial and industrial previously reported

   

$

44,625

     

7.01

     

40,038

     

5.76

                           

$

34,926

     

4.68

         

Reclassification of certain owner-occupied loans

     

9,942

           

9,917

                                   

9,201

               

Commercial and industrial after reclassification

   

$

54,567

     

6.86

     

49,955

     

5.65

                           

$

44,127

     

4.62

         
                                                                                 

Real estate - commercial previously reported

   

$

44,230

     

6.41

     

45,690

     

5.06

                           

$

43,576

     

4.35

         

Reclassification of certain owner-occupied loans

     

(9,942)

           

(9,917)

                                   

(9,201)

               

Real estate - commercial after reclassification

   

$

34,288

     

6.50

     

35,773

     

5.04

                           

$

34,375

     

4.35

         

 

Reconciliation of Quarterly GAAP to Non-GAAP Measures

 
   

Three months ended

   

Year ended

 
   

December 31

   

December 31

 
   

2023

   

2022

   

2023

   

2022

 

Income statement data

                       

In millions, except per share

                       

Net income

                       

Net income

 

$

482

     

765

   

$

2,741

     

1,992

 

Amortization of core deposit and other intangible assets (1)

   

12

     

14

     

48

     

43

 

Merger-related expenses (1)

   

     

33

     

     

431

 

Net operating income

 

$

494

     

812

     

2,789

     

2,466

 

Earnings per common share

                       

Diluted earnings per common share

 

$

2.74

     

4.29

   

$

15.79

     

11.53

 

Amortization of core deposit and other intangible assets (1)

   

.07

     

.08

     

.29

     

.26

 

Merger-related expenses (1)

   

     

.20

     

     

2.63

 

Diluted net operating earnings per common share

 

$

2.81

     

4.57

     

16.08

     

14.42

 

Other expense

                       

Other expense

 

$

1,450

     

1,408

   

$

5,379

     

5,050

 

Amortization of core deposit and other intangible assets

   

(15)

     

(18)

     

(62)

     

(56)

 

Merger-related expenses

   

     

(45)

     

     

(338)

 

Noninterest operating expense

 

$

1,435

     

1,345

   

$

5,317

     

4,656

 

Merger-related expenses

                       

Salaries and employee benefits

 

$

     

4

   

$

     

102

 

Equipment and net occupancy

   

     

2

     

     

7

 

Outside data processing and software

   

     

2

     

     

5

 

Professional and other services

   

     

16

     

     

72

 

Advertising and marketing

   

     

5

     

     

9

 

Other costs of operations

   

     

16

     

     

143

 

Other expense

   

     

45

     

     

338

 

Provision for credit losses

   

     

     

     

242

 

Total

 

$

     

45

   

$

     

580

 

Efficiency ratio

                       

Noninterest operating expense (numerator)

 

$

1,435

     

1,345

   

$

5,317

     

4,656

 

Taxable-equivalent net interest income

 

$

1,735

     

1,841

   

$

7,169

     

5,861

 

Other income

   

578

     

682

     

2,528

     

2,357

 

Less:  Gain (loss) on bank investment securities

   

4

     

(4)

     

4

     

(6)

 

Denominator

 

$

2,309

     

2,527

   

$

9,693

     

8,224

 

Efficiency ratio

   

62.1

%

   

53.3

%

   

54.9

%

   

56.6

%

Balance sheet data

                       

In millions

                       

Average assets

                       

Average assets

 

$

208,752

     

198,592

   

$

205,397

     

190,252

 

Goodwill

   

(8,465)

     

(8,494)

     

(8,473)

     

(7,537)

 

Core deposit and other intangible assets

   

(154)

     

(218)

     

(177)

     

(179)

 

Deferred taxes

   

39

     

54

     

44

     

43

 

Average tangible assets

 

$

200,172

     

189,934

   

$

196,791

     

182,579

 

Average common equity

                       

Average total equity

 

$

26,500

     

25,346

   

$

25,899

     

23,810

 

Preferred stock

   

(2,011)

     

(2,011)

     

(2,011)

     

(1,946)

 

Average common equity

   

24,489

     

23,335

     

23,888

     

21,864

 

Goodwill

   

(8,465)

     

(8,494)

     

(8,473)

     

(7,537)

 

Core deposit and other intangible assets

   

(154)

     

(218)

     

(177)

     

(179)

 

Deferred taxes

   

39

     

54

     

44

     

43

 

Average tangible common equity

 

$

15,909

     

14,677

   

$

15,282

     

14,191

 

At end of quarter

                       

Total assets

                       

Total assets

 

$

208,264

     

200,730

             

Goodwill

   

(8,465)

     

(8,490)

             

Core deposit and other intangible assets

   

(147)

     

(209)

             

Deferred taxes

   

37

     

51

             

Total tangible assets

 

$

199,689

     

192,082

             

Total common equity

                       

Total equity

 

$

26,957

     

25,318

             

Preferred stock

   

(2,011)

     

(2,011)

             

Common equity

   

24,946

     

23,307

             

Goodwill

   

(8,465)

     

(8,490)

             

Core deposit and other intangible assets

   

(147)

     

(209)

             

Deferred taxes

   

37

     

51

             

Total tangible common equity

 

$

16,371

     

14,659

             

_______________

(1)

After any related tax effect.

 

<

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

 
   

Three months ended

 
   

December 31,

   

September 30,

   

June 30,

   

March 31,

   

December 31,

 
   

2023

   

2023

   

2023

   

2023

   

2022

 

Income statement data

                             

In millions, except per share

                             

Net income

                             

Net income

 

$

482

     

690

     

867

     

702

     

765

 

Amortization of core deposit and other intangible assets (1)

   

12

     

12

     

12

     

13

     

14

 

Merger-related expenses (1)

   

     

     

     

     

33

 

Net operating income

 

$

494

     

702

     

879

     

715

     

812

 

Earnings per common share