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M&T Bank Corporation Announces 2013 Fourth Quarter And Full-Year Profits

BUFFALO, N.Y., Jan. 17, 2014 /PRNewswire/ -- M&T Bank Corporation ("M&T") (NYSE: MTB) today reported its results of operations for 2013.

GAAP Results of Operations.  Diluted earnings per common share measured in accordance with generally accepted accounting principles ("GAAP") for the fourth quarter of 2013 were $1.74, compared with $2.16 in the year-earlier quarter and $2.11 in the third quarter of 2013.  GAAP-basis net income in the recent quarter totaled $246 million, compared with $296 million and $294 million in the fourth quarter of 2012 and the third quarter of 2013, respectively.  Expressed as an annualized rate of return on average assets and average common shareholders' equity, GAAP-basis net income for the recent quarter was 1.14% and 8.93%, respectively, compared with 1.45% and 12.10%, respectively, in the year-earlier quarter and 1.39% and 11.06%, respectively, in the third quarter of 2013.

For the full year of 2013, diluted earnings per common share were $8.38, up 11% from $7.54 for 2012.  Net income rose to $1.16 billion in 2013 from $1.03 billion in 2012.  Expressed as a rate of return on average assets and average common shareholders' equity, net income in 2013 was 1.39% and 11.18%, respectively, compared with 1.29% and 10.96%, respectively, in 2012.  

Reflecting on M&T's performance in 2013, Rene F. Jones, Executive Vice President and Chief Financial Officer, commented, "While expenses were elevated by investments in our infrastructure during 2013, M&T achieved a net operating return on average tangible common shareholders' equity of 18.17% for the full year.  Our core capital position strengthened, as the Tier 1 common ratio grew to 9.25% at the 2013 year-end, up 17 basis points from September 30 and 168 basis points higher than at December 31, 2012.  We are also pleased with the continued improvement in credit quality.  M&T's liquidity and risk profile was enhanced during the year through several actions, including replacing less liquid investment securities with Ginnie Mae securities and the securitization of loans held in the loan portfolio.  During the final two quarters of 2013 we invested heavily in several key areas, including risk management, capital planning and stress testing, regulatory compliance, and other operational and technology initiatives.  Those investments will better position M&T for the future."

Supplemental Reporting of Non-GAAP Results of Operations.  M&T consistently provides supplemental reporting of its results on a "net operating" or "tangible" basis, from which M&T excludes the after-tax effect of amortization of core deposit and other intangible assets (and the related goodwill, core deposit intangible and other intangible asset balances, net of applicable deferred tax amounts) and expenses and gains associated with merging acquired operations into M&T, since such amounts are considered by management to be "nonoperating" in nature.  Although "net operating income" as defined by M&T is not a GAAP measure, M&T's management believes that this information helps investors understand the effect of acquisition activity in reported results.  Reconciliations of GAAP to non-GAAP measures are provided in the financial tables included herein.

Diluted net operating earnings per common share, which exclude the impact of amortization of core deposit and other intangible assets and merger-related gains and expenses, were $1.79 in the recent quarter, compared with $2.23 in the year-earlier period and $2.16 in the third quarter of 2013.  Net operating income for the fourth quarter of 2013 was $252 million, compared with $305 million and $301 million in the final quarter of 2012 and the third quarter of 2013, respectively.  For the three months ended December 31, 2013, net operating income expressed as an annualized rate of return on average tangible assets and average tangible common shareholders' equity was 1.22% and 14.12%, respectively, compared with 1.56% and 20.46% in the corresponding 2012 period and 1.48% and 17.64%, respectively, in the third quarter of 2013.

For the year ended December 31, 2013, diluted net operating earnings per common share increased 10% to $8.66 from $7.88 in 2012.  Net operating income for 2013 and 2012 totaled $1.20 billion and $1.07 billion, respectively.  Net operating income in 2013 expressed as a rate of return on average tangible assets and average tangible common shareholders' equity was 1.50% and 18.17%, respectively, compared with 1.40% and 19.42%, respectively, in 2012.

Taxable-equivalent Net Interest Income.  Taxable-equivalent net interest income aggregated $673 million in the fourth quarter of 2013, compared with $679 million in the immediately preceding quarter.  That decline resulted from a five basis point narrowing of the net interest margin to 3.56% in the recent quarter from 3.61% in 2013's third quarter, partially offset by an increase in average earning assets.  Taxable-equivalent net interest income in the recent quarter was little changed from the $674 million earned in the fourth quarter of 2012.  For the year ended December 31, 2013, net interest income on a taxable-equivalent basis rose 3% to $2.70 billion from $2.62 billion in 2012 as a result of a $3.7 billion or 5% increase in average earning assets, partially offset by an eight basis point narrowing of the net interest margin to 3.65% in 2013 from 3.73% in 2012.

Provision for Credit Losses/Asset Quality.  The provision for credit losses was $42 million during the fourth quarter of 2013, down from $49 million in the year-earlier quarter and $48 million in the third quarter of 2013.  The provision was equal to net charge-offs in the third and fourth quarters of 2013, and exceeded net charge-offs by $5 million in the fourth quarter of 2012.  Expressed as an annualized percentage of average loans outstanding, net charge-offs were .26% and .27% in the final quarter of 2013 and 2012, respectively, and .29% in 2013's third quarter.  The provision for credit losses declined 9% to $185 million for the year ended December 31, 2013 from $204 million in 2012.  Net loan charge-offs for 2013 totaled $183 million, or .28% of average loans outstanding, improved from $186 million, or .30% of average loans in 2012.

Loans classified as nonaccrual declined to $871 million, or 1.36% of total loans at December 31, 2013, from $1.01 billion or 1.52% a year earlier and $916 million or 1.44% at September 30, 2013.  Assets taken in foreclosure of defaulted loans were $67 million at December 31, 2013, down from $104 million and $89 million at December 31, 2012 and September 30, 2013, respectively.  

Allowance for Credit Losses.  M&T regularly performs detailed analyses of individual borrowers and portfolios for purposes of assessing the adequacy of the allowance for credit losses.  As a result of those analyses, the allowance totaled $917 million at December 31, 2013, compared with $926 million a year earlier and $916 million at September 30, 2013.  The allowance expressed as a percentage of outstanding loans was 1.43% at the recent quarter-end, compared with 1.39% at December 31, 2012 and 1.44% at September 30, 2013.  

Noninterest Income and Expense.  Noninterest income aggregated $446 million in the recently completed quarter, compared with $453 million and $477 million in the final quarter of 2012 and the third quarter of 2013, respectively.  Reflected in noninterest income in the third quarter of 2013 were gains from loan securitization activities of $56 million.  Net losses from investment securities of $14 million were reflected in noninterest income in the fourth quarter of 2012, due to other-than-temporary impairment charges.  There were no similar gains or losses in 2013's final quarter. 

Excluding gains from securitization activities and losses from investment securities, noninterest income was $446 million in the recent quarter, compared with $468 million in the year-earlier quarter and $421 million in the third quarter of 2013.  As compared with the immediately preceding quarter, the recent quarter's improvement resulted largely from higher mortgage banking revenues, primarily related to increased servicing activities.  The decline in noninterest income as compared with the final 2012 quarter was predominantly due to lower mortgage banking revenues, partially offset by higher trust income.    

Noninterest income aggregated $1.87 billion and $1.67 billion during the years ended December 31, 2013 and 2012, respectively.  That rise was primarily the result of net gains on investment securities and gains on securitization activities, which aggregated $110 million in 2013, compared with net losses on investment securities of $48 million in 2012, supplemented by higher trust income in 2013.

Noninterest expense in the fourth quarter of 2013 totaled $703 million, up from $626 million in the year-earlier quarter and $659 million in 2013's third quarter.  Included in such amounts are expenses considered to be nonoperating in nature consisting of amortization of core deposit and other intangible assets.  Exclusive of those expenses, noninterest operating expenses were $693 million in the recent quarter, up from $612 million and $648 million in the fourth quarter of 2012 and the third quarter of 2013, respectively.  The higher noninterest operating expenses in the recent quarter reflect increased costs for professional services largely associated with investments in M&T's infrastructure related to BSA/AML compliance, capital planning and stress testing, risk management, and operational and technology initiatives.  Those increases amounted to approximately $40 million when compared to the immediately preceding quarter and $50 million in comparison to the fourth quarter of 2012.  The higher level of expenses in the recent quarter as compared with the year-earlier quarter also reflects salaries associated with M&T's expanded residential mortgage loan sub-servicing activities.

For the year ended December 31, 2013, noninterest expense aggregated $2.60 billion, compared with $2.51 billion in the previous year.  Noninterest operating expenses were $2.54 billion in 2013 and $2.44 billion in 2012.  That increase was largely attributable to higher costs for professional services and salaries, partially offset by lower FDIC assessments.

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 61.9% in the recent quarter, compared with 53.6% in the year-earlier quarter and 56.0% in the third quarter of 2013.  The efficiency ratio for the full year of 2013 was unchanged from 2012 at 56.2%.   

Balance Sheet.  M&T had total assets of $85.1 billion at December 31, 2013, up from $83.0 billion a year earlier.  Loans and leases, net of unearned discount, totaled $64.1 billion at the 2013 year-end, compared with $66.6 billion at December 31, 2012.  After considering the impact of the loan securitization transactions during 2013 and a $919 million decline in loans held for sale, M&T experienced growth in its loan portfolio from December 31, 2012 to the 2013 year-end.  Total deposits were $67.1 billion at the recent year-end, $1.5 billion higher than $65.6 billion at December 31, 2012. 

Total shareholders' equity rose $1.1 billion or 11% to $11.3 billion at December 31, 2013 from $10.2 billion a year earlier, representing 13.31% and 12.29%, respectively, of total assets.  Common shareholders' equity was $10.4 billion, or $80.00 per share, at December 31, 2013, compared with $9.3 billion, or $72.73 per share, at December 31, 2012.  Tangible equity per common share rose 18% to $52.64 at December 31, 2013 from $44.61 a year earlier.  Common shareholders' equity per share and tangible equity per share were $77.81 and $50.32, respectively, at September 30, 2013.  In the calculation of tangible equity per common share, common shareholders' equity is reduced by the carrying values of goodwill and core deposit and other intangible assets, net of applicable deferred tax balances.  M&T's tangible common equity to tangible assets ratio was 8.42% at December 31, 2013, compared with 7.20% and 8.11% at December 31, 2012 and September 30, 2013, respectively. M&T's estimated Tier 1 common ratio, a regulatory capital measure, rose to 9.25% at December 31, 2013 from 7.57% and 9.08% at December 31, 2012 and September 30, 2013, respectively.  M&T estimates that the ratio of Common Equity Tier 1 to risk-weighted assets under the new capital rules approved in July 2013 on a fully phased-in basis was approximately 9.01% as of December 31, 2013.

Conference Call.  Investors will have an opportunity to listen to M&T's conference call to discuss fourth quarter and full-year financial results today at 10:30 a.m. Eastern Time.  Those wishing to participate in the call may dial (877)780-2276.  International participants, using any applicable international calling codes, may dial (973)582-2700.  Callers should reference M&T Bank Corporation or the conference ID #31841565.  The conference call will be webcast live on M&T's website at http://ir.mandtbank.com/events.cfm.  A replay of the call will  be available until January 20, 2014 by calling (800)585-8367, or (404)537-3406 for international participants, and by making reference to ID #31841565.  The event will also be archived and available by 7:00 p.m. today on M&T's website at http://ir.mandtbank.com/events.cfm

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

Forward-Looking Statements.  This news release contains forward-looking statements that are based on current expectations, estimates and projections about M&T's business, management's beliefs and assumptions made by management.  These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions ("Future Factors") which are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements.

Future Factors include changes in interest rates, spreads on earning assets and interest-bearing liabilities, and interest rate sensitivity; prepayment speeds, loan originations, credit losses and market values on loans, collateral securing loans, and other assets; sources of liquidity; common shares outstanding; common stock price volatility; fair value of and number of stock-based compensation awards to be issued in future periods; the impact of changes in market values on trust-related revenues; legislation affecting the financial services industry as a whole, and M&T and its subsidiaries individually or collectively, including tax legislation; regulatory supervision and oversight, including monetary policy and capital requirements; changes in accounting policies or procedures as may be required by the Financial Accounting Standards Board or other regulatory agencies; increasing price and product/service competition by competitors, including new entrants; rapid technological developments and changes; the ability to continue to introduce competitive new products and services on a timely, cost-effective basis; the mix of products/services; containing costs and expenses; governmental and public policy changes; protection and validity of intellectual property rights; reliance on large customers; technological, implementation and cost/financial risks in large, multi-year contracts; the outcome of pending and future litigation and governmental proceedings, including tax-related examinations and other matters; continued availability of financing; financial resources in the amounts, at the times and on the terms required to support M&T and its subsidiaries' future businesses; and material differences in the actual financial results of merger, acquisition and investment activities compared with M&T's initial expectations, including the full realization of anticipated cost savings and revenue enhancements.

These are representative of the Future Factors that could affect the outcome of the forward-looking statements.  In addition, such statements could be affected by general industry and market conditions and growth rates, general economic and political conditions, either nationally or in the states in which M&T and its subsidiaries do business, including interest rate and currency exchange rate fluctuations, changes and trends in the securities markets, and other Future Factors.

 

INVESTOR CONTACT:

Donald J. MacLeod


(716) 842-5138



MEDIA CONTACT:

C. Michael Zabel


(716) 842-5385

 

 


M&T BANK CORPORATION
















Financial Highlights



















Three months ended






Year ended





Amounts in thousands,



December 31






December 31





 except per share



2013


2012


Change




2013


2012


Change





















Performance




































Net income 


$

245,722


296,193


-17

%


$

1,162,780


1,029,498


13

%


Net income available to common shareholders 



227,449


276,605


-18

%



1,086,481


953,429


14

%




















Per common share:


















  Basic earnings 


$

1.76


2.18


-19

%


$

8.44


7.57


11

%


  Diluted earnings 



1.74


2.16


-19

%



8.38


7.54


11

%


  Cash dividends 


$

.70


.70


-



$

2.80


2.80


-





















Common shares outstanding:


















  Average - diluted (1) 



130,464


127,800


2

%



129,603


126,405


3

%


  Period end (2) 



130,564


128,234


2

%



130,564


128,234


2

%




















Return on (annualized):


















  Average total assets 



1.14

%

1.45

%





1.39

%

1.29

%




  Average common shareholders' equity 



8.93

%

12.10

%





11.18

%

10.96

%






















Taxable-equivalent net interest income 


$

672,683


673,929


-



$

2,698,200


2,624,907


3

%




















Yield on average earning assets 



3.92

%

4.17

%





4.03

%

4.22

%




Cost of interest-bearing liabilities 



.56

%

.67

%





.60

%

.74

%




Net interest spread 



3.36

%

3.50

%





3.43

%

3.48

%




Contribution of interest-free funds 



.20

%

.24

%





.22

%

.25

%




Net interest margin 



3.56

%

3.74

%





3.65

%

3.73

%






















Net charge-offs to average total 


















  net loans (annualized) 



.26

%

.27

%





.28

%

.30

%






















Net operating results (3)




































Net operating income 


$

252,097


304,657


-17

%


$

1,198,935


1,072,510


12

%


Diluted net operating earnings per common share



1.79


2.23


-20

%



8.66


7.88


10

%


Return on (annualized):


















  Average tangible assets 



1.22

%

1.56

%





1.50

%

1.40

%




  Average tangible common equity 



14.12

%

20.46

%





18.17

%

19.42

%




Efficiency ratio 



61.90

%

53.63

%





56.16

%

56.19

%





























































At December 31













Loan quality



2013


2012


Change





























Nonaccrual loans 


$

871,280


1,013,176


-14

%










Real estate and other foreclosed assets 



66,875


104,279


-36

%










  Total nonperforming assets 


$

938,155


1,117,455


-16

%




























Accruing loans past due 90 days or more (4) 


$

368,510


358,397


3

%




























Government guaranteed loans included in totals


















  above:


















  Nonaccrual loans 


$

63,647


57,420


11

%










  Accruing loans past due 90 days or more 



297,918


316,403


-6

%




























Renegotiated loans 


$

257,092


271,971


-5

%




























Acquired accruing loans past due 90 days or more (5) 

$

129,782


166,554


-22

%




























Purchased impaired loans (6):


















  Outstanding customer balance 


$

579,975


828,571


-30

%










  Carrying amount 



330,792


447,114


-26

%




























Nonaccrual loans to total net loans 



1.36

%

1.52

%






























Allowance for credit losses to total loans 



1.43

%

1.39

%
















































(1)  Includes common stock equivalents.










(2)  Includes common stock issuable under deferred compensation plans.





(3)  Excludes amortization and balances related to goodwill and core deposit and other intangible assets and merger-related gains and expenses which, except in the calculation of the efficiency ratio, are net of applicable income tax effects. Reconciliations of net income with net operating income appear herein.







(4)  Excludes acquired loans. 













(5)  Acquired loans that were recorded at fair value at acquisition date. This category does not include purchased impaired loans that are presented separately.




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






 

 

M&T BANK CORPORATION













Financial Highlights, Five Quarter Trend

















Three months ended




Amounts in thousands,



December 31,


September 30,


June 30,


March 31,


December 31,



 except per share



2013


2013


2013


2013


2012























Performance








































Net income


$

245,722



294,479



348,466



274,113



296,193




Net income available to common shareholders 



227,449



275,356



328,557



255,096



276,605
























Per common share:



















  Basic earnings 


$

1.76



2.13



2.56



2.00



2.18




  Diluted earnings 



1.74



2.11



2.55



1.98



2.16




  Cash dividends 


$

.70



.70



.70



.70



.70
























Common shares outstanding:



















  Average - diluted (1) 



130,464



130,265



129,017



128,636



127,800




  Period end (2)



130,564



130,241



129,464



128,999



128,234
























Return on (annualized):



















  Average total assets 



1.14

%


1.39

%


1.68

%


1.36

%


1.45

%



  Average common shareholders' equity 



8.93

%


11.06

%


13.78

%


11.10

%


12.10

%























Taxable-equivalent net interest income 


$

672,683



679,213



683,804



662,500



673,929
























Yield on average earning assets 



3.92

%


3.98

%


4.10

%


4.13

%


4.17

%



Cost of interest-bearing liabilities 



.56

%


.58

%


.62

%


.64

%


.67

%



Net interest spread 



3.36

%


3.40

%


3.48

%


3.49

%


3.50

%



Contribution of interest-free funds 



.20

%


.21

%


.23

%


.22

%


.24

%



Net interest margin 



3.56

%


3.61

%


3.71

%


3.71

%


3.74

%























Net charge-offs to average total 



















  net loans (annualized) 



.26

%


.29

%


.35

%


.23

%


.27

%























Net operating results (3)







































Net operating income 


$

252,097



300,968



360,734



285,136



304,657




Diluted net operating earnings per common share 



1.79



2.16



2.65



2.06



2.23




Return on (annualized):



















  Average tangible assets 



1.22

%


1.48

%


1.81

%


1.48

%


1.56

%



  Average tangible common equity 



14.12

%


17.64

%


22.72

%


18.71

%


20.46

%



Efficiency ratio 



61.90

%


56.03

%


50.92

%


55.88

%


53.63

%











































































December 31,


September 30,


June 30,


March 31,


December 31,



Loan quality



2013


2013


2013


2013


2012























Nonaccrual loans 


$

871,280



915,871



964,906



1,052,794



1,013,176




Real estate and other foreclosed assets 



66,875



89,203



82,088



95,680



104,279




  Total nonperforming assets 


$

938,155



1,005,074



1,046,994



1,148,474



1,117,455
























Accruing loans past due 90 days or more (4) 


$

368,510



339,792



340,467



331,283



358,397
























Government guaranteed loans included in totals



















  above:



















  Nonaccrual loans 


$

63,647



68,519



69,508



63,385



57,420




  Accruing loans past due 90 days or more 



297,918



320,732



315,281



311,579



316,403
























Renegotiated loans 


$

257,092



259,301



263,351



272,285



271,971
























Acquired accruing loans past due 90 days or more (5)


$

129,782



153,585



155,686



157,068



166,554
























Purchased impaired loans (6):



















  Outstanding customer balance 


$

579,975



648,118



725,196



790,048



828,571




  Carrying amount 



330,792



357,337



394,697



425,232



447,114
























Nonaccrual loans to total net loans 



1.36

%


1.44

%


1.46

%


1.60

%


1.52

%























Allowance for credit losses to total loans 



1.43

%


1.44

%


1.41

%


1.41

%


1.39

%











































(1)  Includes common stock equivalents.













(2)  Includes common stock issuable under deferred compensation plans.









(3)  Excludes amortization and balances related to goodwill and core deposit and other intangible assets and merger-related gains and expenses which, except in the calculation of the efficiency ratio, are net of applicable income tax effects.  Reconciliations of net income with net operating income appear herein.



(4)  Excludes acquired loans. 












(5)  Acquired loans that were recorded at fair value at acquisition date. This category does not include purchased impaired loans that are presented separately.


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












 

 

M&T BANK CORPORATION













Condensed Consolidated Statement of Income































Three months ended






Year ended






December 31






December 31




Dollars in thousands


2013


2012


Change




2013


2012


Change


















Interest income 

$

734,466


745,353


-1

%


$

2,957,334


2,941,685


1

%

Interest expense 


67,982


77,931


-13




284,105


343,169


-17


















Net interest income 


666,484


667,422


-




2,673,229


2,598,516


3


















Provision for credit losses 


42,000


49,000


-14




185,000


204,000


-9


















Net interest income after
















   provision for credit losses 


624,484


618,422


1




2,488,229


2,394,516


4


















Other income
















     Mortgage banking revenues 


82,169


116,546


-29




331,265


349,064


-5


     Service charges on deposit accounts 


110,436


112,364


-2




446,941


446,698


-


     Trust income 


125,876


116,915


8




496,008


471,852


5


     Brokerage services income 


15,807


14,872


6




65,647


59,059


11


     Trading account and foreign exchange gains 


13,690


10,356


32




40,828


35,634


15


     Gain on bank investment securities 


-


-


-




56,457


9


-


     Other-than-temporary impairment losses 
















        recognized in earnings 


-


(14,491)


-




(9,800)


(47,822)


-


     Equity in earnings of Bayview Lending Group LLC 


(6,136)


(4,941)


-




(16,126)


(21,511)


-


     Other revenues from operations 


104,404


101,543


3




453,985


374,287


21


          Total other income 


446,246


453,164


-2




1,865,205


1,667,270


12


















Other expense
















     Salaries and employee benefits 


336,159


323,010


4




1,355,178


1,314,540


3


     Equipment and net occupancy 


68,670


62,884


9




264,327


257,551


3


     Printing, postage and supplies 


8,808


10,417


-15




39,557


41,929


-6


     Amortization of core deposit and other 
















        intangible assets 


10,439


13,865


-25




46,912


60,631


-23


     FDIC assessments 


17,574


23,398


-25




69,584


101,110


-31


     Other costs of operations  


261,422


192,572


36




820,327


733,499


12


          Total other expense 


703,072


626,146


12




2,595,885


2,509,260


3


















Income before income taxes 


367,658


445,440


-17




1,757,549


1,552,526


13


















Applicable income taxes 


121,936


149,247


-18




594,769


523,028


14


















Net income 

$

245,722


296,193


-17

%


$

1,162,780


1,029,498


13

%

















 

 

M&T BANK CORPORATION











Condensed Consolidated Statement of Income, Five Quarter Trend





























Three months ended




December 31,


September 30,


June 30,


March 31,


December 31,

Dollars in thousands


2013


2013


2013


2013


2012

















Interest income 

$

734,466



742,686



750,207



729,975



745,353


Interest expense 


67,982



69,578



72,620



73,925



77,931


















Net interest income 


666,484



673,108



677,587



656,050



667,422


















Provision for credit losses 


42,000



48,000



57,000



38,000



49,000


















Net interest income after
















   provision for credit losses 


624,484



625,108



620,587



618,050



618,422


















Other income
















     Mortgage banking revenues 


82,169



64,731



91,262



93,103



116,546


     Service charges on deposit accounts 


110,436



113,839



111,717



110,949



112,364


     Trust income 


125,876



123,801



124,728



121,603



116,915


     Brokerage services income 


15,807



16,871



17,258



15,711



14,872


     Trading account and foreign exchange gains 


13,690



8,987



9,224



8,927



10,356


     Gain on bank investment securities 


-



-



56,457



-



-


     Other-than-temporary impairment losses 
















        recognized in earnings 


-



-



-



(9,800)



(14,491)


     Equity in earnings of Bayview Lending Group LLC 


(6,136)



(3,881)



(2,453)



(3,656)



(4,941)


     Other revenues from operations 


104,404



153,040



100,496



96,045



101,543


          Total other income 


446,246



477,388



508,689



432,882



453,164


















Other expense
















     Salaries and employee benefits 


336,159



339,332



323,136



356,551



323,010


     Equipment and net occupancy 


68,670



66,220



64,278



65,159



62,884


     Printing, postage and supplies 


8,808



9,752



10,298



10,699



10,417


     Amortization of core deposit and other 
















        intangible assets 


10,439



10,628



12,502



13,343



13,865


     FDIC assessments 


17,574



14,877



17,695



19,438



23,398


     Other costs of operations  


261,422



217,817



170,682



170,406



192,572


          Total other expense 


703,072



658,626



598,591



635,596



626,146


















Income before income taxes 


367,658



443,870



530,685



415,336



445,440


















Applicable income taxes 


121,936



149,391



182,219



141,223



149,247


















Net income 

$

245,722



294,479



348,466



274,113



296,193


















 

 

M&T BANK CORPORATION







Condensed Consolidated Balance Sheet



















December 31




Dollars in thousands



2013


2012


Change











ASSETS


















Cash and due from banks 


$

1,573,361


1,983,615


-21

%










Interest-bearing deposits at banks 



1,651,138


129,945


-











Federal funds sold and agreements









  to resell securities 



99,573


3,000


-











Trading account assets 



376,131


488,966


-23











Investment securities 



8,796,497


6,074,361


45











Loans and leases:


















   Commercial, financial, etc. 



18,705,216


17,776,953


5


   Real estate - commercial 



26,148,208


25,993,790


1


   Real estate - consumer 



8,928,221


11,240,837


-21


   Consumer 



10,291,514


11,559,377


-11


     Total loans and leases, net of unearned discount 



64,073,159


66,570,957


-4


        Less: allowance for credit losses 



916,676


925,860


-1











  Net loans and leases 



63,156,483


65,645,097


-4











Goodwill 



3,524,625


3,524,625


-











Core deposit and other intangible assets 



68,851


115,763


-41











Other assets 



5,900,032


5,043,431


17











  Total assets 


$

85,146,691


83,008,803


3

%



















LIABILITIES AND SHAREHOLDERS' EQUITY


















Noninterest-bearing deposits 


$

24,661,007


24,240,802


2

%










Interest-bearing deposits 



42,134,859


40,325,932


4











Deposits at Cayman Islands office 



322,746


1,044,519


-69











  Total deposits 



67,118,612


65,611,253


2











Short-term borrowings 



260,455


1,074,482


-76











Accrued interest and other liabilities 



1,328,922


1,512,717


-12











Long-term borrowings 



5,108,870


4,607,758


11











  Total liabilities 



73,816,859


72,806,210


1











Shareholders' equity:


















   Preferred 



881,500


872,500


1


   Common (1)  



10,448,332


9,330,093


12











     Total shareholders' equity 



11,329,832


10,202,593


11











  Total liabilities and shareholders' equity 


$

85,146,691


83,008,803


3

%



















(1)  Reflects accumulated other comprehensive loss, net of applicable income tax effect, of $64.2 million


       at December 31, 2013 and $240.3 million at December 31, 2012.











 

 

M&T BANK CORPORATION














Condensed Consolidated Balance Sheet, Five Quarter Trend






















December 31,


September 30,



June 30,



March 31,



December 31,


Dollars in thousands



2013


2013



2013



2013



2012



















ASSETS


































Cash and due from banks 


$

1,573,361



1,941,944



1,350,015



1,231,091



1,983,615



















Interest-bearing deposits at banks 



1,651,138



1,925,811



2,555,354



1,304,770



129,945



















Federal funds sold and agreements

















  to resell securities 



99,573



117,809



124,487



594,976



3,000



















Trading account assets 



376,131



371,370



378,235



420,144



488,966



















Investment securities 



8,796,497



8,309,773



5,210,526



5,660,831



6,074,361



















Loans and leases:


































   Commercial, financial, etc. 



18,705,216



17,911,149



18,021,812



17,469,138



17,776,953


   Real estate - commercial 



26,148,208



26,345,267



26,116,394



25,944,819



25,993,790


   Real estate - consumer 



8,928,221



9,228,003



10,399,749



11,094,577



11,240,837


   Consumer 



10,291,514



10,174,623



11,433,911



11,415,733



11,559,377


     Total loans and leases, net of unearned discount 


64,073,159



63,659,042



65,971,866



65,924,267



66,570,957


        Less: allowance for credit losses 



916,676



916,370



927,065



927,117



925,860



















  Net loans and leases 



63,156,483



62,742,672



65,044,801



64,997,150



65,645,097



















Goodwill 



3,524,625



3,524,625



3,524,625



3,524,625



3,524,625



















Core deposit and other intangible assets 



68,851



79,290



89,918



102,420



115,763



















Other assets 



5,900,032



5,414,191



4,951,044



4,975,950



5,043,431



















  Total assets 


$

85,146,691



84,427,485



83,229,005



82,811,957



83,008,803




































LIABILITIES AND SHAREHOLDERS' EQUITY


































Noninterest-bearing deposits 


$

24,661,007



24,150,771



24,074,815



23,603,971



24,240,802



















Interest-bearing deposits 



42,134,859



42,084,860



41,302,212



41,219,679



40,325,932



















Deposits at Cayman Islands office 



322,746



316,510



284,443



266,076



1,044,519



















  Total deposits 



67,118,612



66,552,141



65,661,470



65,089,726



65,611,253



















Short-term borrowings



260,455



246,019



307,740



374,593



1,074,482



















Accrued interest and other liabilities 



1,328,922



1,491,797



1,421,067



1,530,118



1,512,717



















Long-term borrowings 



5,108,870



5,121,326



5,122,398



5,394,563



4,607,758



















  Total liabilities 



73,816,859



73,411,283



72,512,675



72,389,000



72,806,210



















Shareholders' equity:


































   Preferred 



881,500



879,010



876,796



874,627



872,500


   Common (1) 



10,448,332



10,137,192



9,839,534



9,548,330



9,330,093



















     Total shareholders' equity 



11,329,832



11,016,202



10,716,330



10,422,957



10,202,593



















  Total liabilities and shareholders' equity 


$

85,146,691



84,427,485



83,229,005



82,811,957



83,008,803




































(1)  Reflects accumulated other comprehensive loss, net of applicable income tax effect, of $64.2 million at December 31, 2013, $198.1 million at September 30, 2013, $227.8 million at June 30, 2013, $226.0 million at March 31, 2013 and $240.3 million at December 31, 2012.




















 

 

M&T BANK CORPORATION





























Condensed Consolidated Average Balance Sheet


























 and Annualized Taxable-equivalent Rates




























































Three months ended


Change in balance



Year ended







December 31,


December 31,


September 30,


December 31, 2013 from



December 31,




Dollars in millions



2013


2012


2013


December 31,


September 30,



2013


2012


Change in




Balance


Rate


Balance


Rate


Balance


Rate


2012


2013



Balance


Rate


Balance 


Rate


balance


ASSETS
































































Interest-bearing deposits at banks 


$

2,948


.25

%

273


.15

%

2,646


.25

%

982

%


11

%


$

2,139


.24

%

528


.23

%

305

%

































Federal funds sold and agreements
































  to resell securities 



115


.07


3


.57


117


.08


-



-2




128


.09


4


.55


-


































Trading account assets 



82


1.36


97


1.45


67


1.27


-15



23




78


1.91


96


1.45


-19


































Investment securities 



8,354


3.32


6,295


3.31


6,979


3.31


33



20




6,615


3.32


6,969


3.44


-5


































Loans and leases, net of unearned discount
































  Commercial, financial, etc. 



18,096


3.41


16,995


3.68


17,798


3.50


6



2




17,736


3.54


16,336


3.71


9


  Real estate - commercial



26,231


4.48


25,332


4.50


26,129


4.51


4



-




26,083


4.53


24,907


4.50


5


  Real estate - consumer 



8,990


4.20


11,087


4.10


9,636


4.17


-19



-7




10,136


4.12


9,727


4.33


4


  Consumer 



10,233


4.60


11,597


4.69


11,295


4.57


-12



-9




11,098


4.60


11,732


4.77


-5


     Total loans and leases, net 



63,550


4.17


65,011


4.28


64,858


4.21


-2



-2




65,053


4.24


62,702


4.35


4


































  Total earning assets 



75,049


3.92


71,679


4.17


74,667


3.98


5



1




74,013


4.03


70,299


4.22


5


































Goodwill 



3,525




3,525




3,525




-



-




3,525




3,525




-


































Core deposit and other intangible assets 



74




122




84




-40



-13




90




144




-37


































Other assets 



6,682




6,040




5,735




11



17




6,034




6,015




-


































  Total assets 


$

85,330




81,366




84,011




5

%


2

%


$

83,662




79,983




5

%

































































































LIABILITIES AND SHAREHOLDERS' EQUITY






























































Interest-bearing deposits
































  NOW accounts 


$

933


.13


881


.14


924


.14


6

%


1

%


$

923


.14


856


.16


8

%

  Savings deposits 



38,079


.14


34,587


.19


36,990


.15


10



3




36,739


.15


33,398


.20


10


  Time deposits 



3,617


.51


4,727


.79


3,928


.62


-23



-8




4,045


.65


5,347


.86


-24


  Deposits at Cayman Islands office 



414


.21


763


.18


392


.22


-46



6




496


.21


605


.19


-18


     Total interest-bearing deposits 



43,043


.17


40,958


.26


42,234


.19


5



2




42,203


.20


40,206


.29


5


































Short-term borrowings 



287


.06


677


.16


299


.08


-58



-4




390


.11


839


.15


-54


Long-term borrowings 



5,009


3.91


4,510


4.52


5,010


3.89


11



-




4,941


4.05


5,527


4.08


-11


































Total interest-bearing liabilities 



48,339


.56


46,145


.67


47,543


.58


5



2




47,534


.60


46,572


.74


2


































Noninterest-bearing deposits 



24,169




23,311




23,998




4



1




23,721




21,761




9


































Other liabilities 



1,713




1,805




1,589




-5



8




1,685




1,947




-13


































  Total liabilities 



74,221




71,261




73,130




4



1




72,940




70,280




4


































Shareholders' equity 



11,109




10,105




10,881




10



2




10,722




9,703




10


































  Total liabilities and shareholders' equity 


$

85,330




81,366




84,011




5

%


2

%


$

83,662




79,983




5

%

































































Net interest spread 





3.36




3.50




3.40











3.43




3.48




Contribution of interest-free funds 





.20




.24




.21











.22




.25




Net interest margin 





3.56

%



3.74

%



3.61

%










3.65

%



3.73

%



































 

 

M&T BANK CORPORATION










Reconciliation of GAAP to Non-GAAP Measures








































Three months ended



Year ended






December 31



December 31






2013


2012



2013


2012


Income statement data













In thousands, except per share













Net income













Net income 



$

245,722


296,193


$

1,162,780


1,029,498


Amortization of core deposit and other












  intangible assets (1) 




6,375


8,464



28,644


37,011


Merger-related expenses (1) 




-


-



7,511


6,001


  Net operating income 



$

252,097


304,657


$

1,198,935


1,072,510


Earnings per common share













Diluted earnings per common share 



$

1.74


2.16


$

8.38


7.54


Amortization of core deposit and other












  intangible assets (1) 




.05


.07



.22


.29


Merger-related expenses (1) 




-


-



.06


.05


  Diluted net operating earnings per common share 

$

1.79


2.23


$

8.66


7.88


Other expense













Other expense 



$

703,072


626,146


$

2,595,885


2,509,260


Amortization of core deposit and other












  intangible assets 




(10,439)


(13,865)



(46,912)


(60,631)


Merger-related expenses 




-


-



(12,364)


(9,879)


  Noninterest operating expense 



$

692,633


612,281


$

2,536,609


2,438,750


Merger-related expenses













Salaries and employee benefits 



$

-


-


$

836


4,997


Equipment and net occupancy 




-


-



690


15


Printing, postage and supplies 




-


-



1,825


-


Other costs of operations 




-


-



9,013


4,867


  Total 



$

-


-


$

12,364


9,879


Efficiency ratio













Noninterest operating expense (numerator) 

$

692,633


612,281


$

2,536,609


2,438,750


Taxable-equivalent net interest income 



672,683


673,929



2,698,200


2,624,907


Other income 




446,246


453,164



1,865,205


1,667,270


Less:  Gain on bank investment securities 


-


-



56,457


9


           Net OTTI losses recognized in earnings 


-


(14,491)



(9,800)


(47,822)


Denominator 



$

1,118,929


1,141,584


$

4,516,748


4,339,990


Efficiency ratio 




61.90

%

53.63

%


56.16

%

56.19

%



























Balance sheet data













In millions













Average assets













Average assets 



$

85,330


81,366


$

83,662


79,983


Goodwill 




(3,525)


(3,525)



(3,525)


(3,525)


Core deposit and other intangible assets 



(74)


(122)



(90)


(144)


Deferred taxes 




23


36



27


42


  Average tangible assets 



$

81,754


77,755


$

80,074


76,356


Average common equity













Average total equity 



$

11,109


10,105


$

10,722


9,703


Preferred stock 




(881)


(872)



(878)


(869)


  Average common equity




10,228


9,233



9,844


8,834


Goodwill 




(3,525)


(3,525)



(3,525)


(3,525)


Core deposit and other intangible assets 



(74)


(122)



(90)


(144)


Deferred taxes 




23


36



27


42


  Average tangible common equity 



$

6,652


5,622


$

6,256


5,207















At end of quarter













Total assets













Total assets 



$

85,147


83,009







Goodwill 




(3,525)


(3,525)







Core deposit and other intangible assets 




(69)


(116)







Deferred taxes 




21


34







  Total tangible assets 



$

81,574


79,402







Total common equity













Total equity 



$

11,330


10,203







Preferred stock




(882)


(873)







Undeclared dividends - cumulative preferred stock 


(3)


(3)







  Common equity, net of undeclared cumulative











    preferred dividends 




10,445


9,327







Goodwill 




(3,525)


(3,525)







Core deposit and other intangible assets 



(69)


(116)







Deferred taxes 




21


34







  Total tangible common equity 



$

6,872


5,720

































(1) After any related tax effect.





















 

 

M&T BANK CORPORATION










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






















































Three months ended






December 31,


September 30,


June 30,


March 31,


December 31,






2013


2013


2013


2013


2012


Income statement data














In thousands, except per share














Net income














Net income

$

245,722


294,479


348,466


274,113


296,193


Amortization of core deposit and other













  intangible assets (1)


6,375


6,489


7,632


8,148


8,464


Merger-related expenses (1)


-


-


4,636


2,875


-


  Net operating income

$

252,097


300,968


360,734


285,136


304,657


Earnings per common share














Diluted earnings per common share

$

1.74


2.11


2.55


1.98


2.16


Amortization of core deposit and other













  intangible assets (1)


.05


.05


.06


.06


.07


Merger-related expenses (1)


-


-


.04


.02


-


  Diluted net operating earnings per common share

$

1.79


2.16


2.65


2.06


2.23


Other expense














Other expense

$

703,072


658,626


598,591


635,596


626,146


Amortization of core deposit and other













  intangible assets


(10,439)


(10,628)


(12,502)


(13,343)


(13,865)


Merger-related expenses


-


-


(7,632)


(4,732)


-


  Noninterest operating expense

$

692,633


647,998


578,457


617,521


612,281


Merger-related expenses














Salaries and employee benefits

$

-


-


300


536


-


Equipment and net occupancy


-


-


489


201


-


Printing, postage and supplies


-


-


998


827


-


Other costs of operations


-


-


5,845


3,168


-


  Total

$

-


-


7,632


4,732


-


Efficiency ratio














Noninterest operating expense (numerator)

$

692,633


647,998


578,457


617,521


612,281


Taxable-equivalent net interest income


672,683


679,213


683,804


662,500


673,929


Other income


446,246


477,388


508,689


432,882


453,164


Less:  Gain on bank investment securities


-


-


56,457


-


-


           Net OTTI losses recognized in earnings


-


-


-


(9,800)


(14,491)


Denominator

$

1,118,929


1,156,601


1,136,036


1,105,182


1,141,584


Efficiency ratio


61.90

%

56.03

%

50.92

%

55.88

%

53.63

%





























Balance sheet data














In millions














Average assets














Average assets

$

85,330


84,011


83,352


81,913


81,366


Goodwill


(3,525)


(3,525)


(3,525)


(3,525)


(3,525)


Core deposit and other intangible assets


(74)


(84)


(95)


(109)


(122)


Deferred taxes


23


25


28


32


36


  Average tangible assets

$

81,754


80,427


79,760


78,311


77,755


Average common equity














Average total equity

$

11,109


10,881


10,563


10,322


10,105


Preferred stock


(881)


(878)


(876)


(874)


(872)


  Average common equity


10,228


10,003


9,687


9,448


9,233


Goodwill


(3,525)


(3,525)


(3,525)


(3,525)


(3,525)


Core deposit and other intangible assets


(74)


(84)


(95)


(109)


(122)


Deferred taxes


23


25


28


32


36


  Average tangible common equity

$

6,652


6,419


6,095


5,846


5,622
















At end of quarter














Total assets














Total assets

$

85,147


84,427


83,229


82,812


83,009


Goodwill


(3,525)


(3,525)


(3,525)


(3,525)


(3,525)


Core deposit and other intangible assets


(69)


(79)


(90)


(102)


(116)


Deferred taxes


21


24


27


30


34


  Total tangible assets

$

81,574


80,847


79,641


79,215


79,402


Total common equity














Total equity

$

11,330


11,016


10,716


10,423


10,203


Preferred stock

(882)


(879)


(877)


(875)


(873)


Undeclared dividends - cumulative preferred stock


(3)


(4)


(3)


(3)


(3)


  Common equity, net of undeclared cumulative












    preferred dividends


10,445


10,133


9,836


9,545


9,327


Goodwill


(3,525)


(3,525)


(3,525)


(3,525)


(3,525)


Core deposit and other intangible assets


(69)


(79)


(90)


(102)


(116)


Deferred taxes


21


24


27


30


34


  Total tangible common equity

$

6,872


6,553


6,248


5,948


5,720






























(1) After any related tax effect.




































 

 

SOURCE M&T Bank Corporation

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