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M&T Bank Corporation Announces Third Quarter Results

BUFFALO, N.Y., Oct. 17, 2014 /PRNewswire/ -- M&T Bank Corporation ("M&T")(NYSE: MTB) today reported its results of operations for the quarter ended September 30, 2014.

GAAP Results of Operations.  Diluted earnings per common share measured in accordance with generally accepted accounting principles ("GAAP") for the third quarter of 2014 were $1.91, compared with $2.11 in the year-earlier quarter and $1.98 in the second quarter of 2014.  GAAP-basis net income in the recently completed quarter aggregated $275 million, compared with $294 million and $284 million in the third quarter of 2013 and the second quarter of 2014, respectively.  GAAP-basis net income for the third quarter of 2014 expressed as an annualized rate of return on average assets and average common shareholders' equity was 1.17% and 9.18%, respectively, compared with 1.39% and 11.06%, respectively, in the year-earlier quarter and 1.27% and 9.79%, respectively, in 2014's second quarter.  Reflected in last year's third quarter profits were after-tax gains of $34 million from loan securitization transactions that added $.26 of diluted earnings per common share to that quarter's results.

Commenting on M&T's financial performance for the recent quarter, Rene F. Jones, Vice Chairman and Chief Financial Officer, noted, "Revenue levels were largely unchanged in comparison with the linked quarter.  Average loans grew modestly and fee income declined slightly from the strong second quarter performance.  Most important was the substantial progress we have made on our key initiatives related to strengthening M&T's BSA/AML, compliance and risk management infrastructure.  That progress led to the continuation of an elevated level of operating expenses, but we firmly believe that our decision to invest in these initiatives is money well-spent.  Significantly, credit quality remained quite strong, as reflected in lower levels of nonperforming loans and net charge-offs when compared with the previous quarter."

Supplemental Reporting of Non-GAAP Results of Operations.  M&T consistently provides supplemental reporting of its results on a "net operating" or "tangible" basis, from which M&T excludes the after-tax effect of amortization of core deposit and other intangible assets (and the related goodwill, core deposit intangible and other intangible asset balances, net of applicable deferred tax amounts) and gains and expenses associated with merging acquired operations into M&T, since such items 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. 

Diluted net operating earnings per common share were $1.94 in the third quarter of 2014, compared with $2.16 and $2.02 in the year-earlier quarter and the second quarter of 2014, respectively.  Net operating income during the recent quarter was $280 million, compared with $301 million in the third quarter of 2013 and $290 million in 2014's second quarter.  Expressed as an annualized rate of return on average tangible assets and average tangible common shareholders' equity, net operating income was 1.24% and 13.80%, respectively, in the recent quarter, compared with 1.48% and 17.64%, respectively, in the third quarter of 2013 and 1.35% and 14.92%, respectively, in the second quarter of 2014. 

Taxable-equivalent Net Interest Income.  Net interest income expressed on a taxable-equivalent basis totaled $675 million in each of the second and third quarters of 2014.  A 17 basis point decline in the net interest margin to 3.23% in the recent quarter was offset by a $3.2 billion increase in average earning assets, including a $1.8 billion rise in average investment securities.  Taxable-equivalent net interest income in the recent quarter was down $4 million from $679 million in the year-earlier period reflecting a 38 basis point decline of the net interest margin from 3.61% in the third quarter of 2013 that was substantially offset by an $8.1 billion rise in average earning assets, including $5.8 billion of investment securities.  In each quarterly comparison, the decline in the net interest margin was attributable to increased lower-yielding balances of investment securities and deposits held at the Federal Reserve Bank of New York combined with continuing downward pressure on yields earned on loans. The growth in investment securities resulted from progress made in response to new regulatory liquidity requirements that were recently finalized and will become effective for M&T in January 2016.

Provision for Credit Losses/Asset Quality.  The provision for credit losses was $29 million in the recent quarter, compared with $48 million in the third quarter of 2013 and $30 million in 2014's second quarter. Net charge-offs of loans were $28 million during 2014's third quarter, compared with $48 million and $29 million in the third quarter of 2013 and second quarter of 2014, respectively.  Expressed as an annualized percentage of average loans outstanding, net charge-offs were .17% and .29% in the third quarter of 2014 and 2013, respectively, and .18% in the second quarter of 2014.

Loans classified as nonaccrual declined to $848 million, or 1.29% of total loans outstanding at September 30, 2014, improved from $916 million or 1.44% at September 30, 2013 and $880 million or 1.36% at June 30, 2014.  Assets taken in foreclosure of defaulted loans totaled $68 million at September 30, 2014, compared with $89 million and $60 million at September 30, 2013 and June 30, 2014, 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 $919 million or 1.40% of loans outstanding at September 30, 2014, compared with $916 million or 1.44% at September 30, 2013 and $918 million or 1.42% at June 30, 2014

Noninterest Income and Expense.  Noninterest income totaled $451 million in the recent quarter, little changed from $456 million in the second quarter of 2014, but down from $477 million in the third quarter of 2013 when $56 million of pre-tax gains from loan securitization transactions were realized.  Excluding those gains, noninterest income in the year-earlier quarter aggregated $421 million. The improvement in the recent quarter as compared with 2013's third quarter, exclusive of the gains from securitizations, resulted predominantly from higher residential mortgage banking revenues associated with loan servicing activities. 

Noninterest expenses in the third quarter of 2014 totaled $679 million, compared with $659 million in the year-earlier quarter and $681 million in the second quarter of 2014.  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 $672 million in each of the two most recent quarters and $648 million in the third quarter of 2013. The higher level of operating expenses in the recent quarter as compared with the year-earlier period was predominantly attributable to increased costs for professional services and salaries associated with BSA/AML activities, compliance, capital planning and stress testing, and risk management initiatives. 

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 59.7% in the recent quarter, 59.4% in the second quarter of 2014 and 56.0% in 2013's third quarter.

Balance Sheet.  M&T had total assets of $97.2 billion at September 30, 2014, up 15% from $84.4 billion a year earlier.  Investment securities were $13.3 billion at the recent quarter-end, up $5.0 billion or 61% from September 30, 2013.  M&T added investment securities during 2013 and 2014 through purchase and loan securitization transactions in order to enhance its liquidity position in response to new regulatory requirements.   Loans and leases, net of unearned discount, totaled $65.6 billion at September 30, 2014, $1.9 billion or 3% above $63.7 billion a year earlier.  Total deposits rose 12% to $74.3 billion at the recent quarter-end from $66.6 billion at September 30, 2013

Total shareholders' equity also rose 12% to $12.3 billion at September 30, 2014 from $11.0 billion a year earlier, representing 12.68% and 13.05%, respectively, of total assets.  Common shareholders' equity was $11.1 billion, or $83.99 per share, at September 30, 2014, compared with $10.1 billion, or $77.81 per share, at September 30, 2013.  Tangible equity per common share rose 13% to $57.10 at September 30, 2014 from $50.32 at September 30, 2013.  Common shareholders' equity per share and tangible equity per common share were $82.86 and $55.89, respectively, at June 30, 2014.  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 estimated Tier 1 common ratio, a regulatory capital measure, continued to increase and was 9.77% at September 30, 2014, compared with 9.08% and 9.63% at September 30, 2013 and June 30, 2014, respectively.  M&T estimates that the ratio of Common Equity Tier 1 to risk-weighted assets under the capital rules approved in July 2013 on a fully phased-in basis was approximately 9.52% as of September 30, 2014.

Conference Call.  Investors will have an opportunity to listen to M&T's conference call to discuss third quarter financial results today at 11:00 a.m. Eastern Time.  Those wishing to participate in the call may dial (877)780-2276.  International participants, using any applicable international calling codes, may dial (973)582-2700.  Callers should reference M&T Bank Corporation or the conference ID #15231149.  The conference call will be webcast live through M&T's website at http://ir.mandtbank.com/events.cfm.  A replay of the call will be available until October 20, 2014 by calling (800)585-8367, or (404)537-3406 for international participants, and by making reference to ID #15231149.  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 regulatory agencies; increasing price and product/service competition by competitors, including new entrants; rapid technological developments and changes; the ability to continue to introduce competitive new products and services on a timely, cost-effective basis; the mix of products/services; containing costs and expenses; governmental and public policy changes; protection and validity of intellectual property rights; reliance on large customers; technological, implementation and cost/financial risks in large, multi-year contracts; the outcome of pending and future litigation and governmental proceedings, including tax-related examinations and other matters; continued availability of financing; financial resources in the amounts, at the times and on the terms required to support M&T and its subsidiaries' future businesses; and material differences in the actual financial results of merger, acquisition and investment activities compared with M&T's initial expectations, including the full realization of anticipated cost savings and revenue enhancements.

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

INVESTOR CONTACT: Donald J. MacLeod
                                  (716) 842-5138

MEDIA CONTACT: C. Michael Zabel
                            (716) 842-5385

 

M&T BANK CORPORATION













Financial Highlights















Three months ended







Nine months ended




Amounts in thousands,


September 30







September 30




 except per share


2014


2013


Change





2014


2013


Change



















Performance


































Net income 

$

275,344


294,479


-6

%


$

788,697


917,058


-14

%

Net income available to common shareholders 


251,917


275,356


-9

%



724,344


859,000


-16

%


















Per common share:

















  Basic earnings 

$

1.92


2.13


-10

%


$

5.54


6.69


-17

%

  Diluted earnings 


1.91


2.11


-9

%



5.50


6.64


-17

%

  Cash dividends 

$

.70


.70


-




$

2.10


2.10


-



















Common shares outstanding:

















  Average - diluted (1) 


132,128


130,265


1

%



131,698


129,312


2

%

  Period end (2) 


132,142


130,241


1

%



132,142


130,241


1

%


















Return on (annualized):

















  Average total assets  


1.17

%

1.39

%






1.17

%

1.48

%



  Average common shareholders' equity  


9.18

%

11.06

%






9.07

%

11.98

%




















Taxable-equivalent net interest income 

$

674,900


679,213


-1

%


$

2,012,241


2,025,517


-1

%


















Yield on average earning assets 


3.59

%

3.98

%






3.72

%

4.07

%



Cost of interest-bearing liabilities 


.54

%

.58

%






.53

%

.61

%



Net interest spread 


3.05

%

3.40

%






3.19

%

3.46

%



Contribution of interest-free funds 


.18

%

.21

%






.19

%

.22

%



Net interest margin 


3.23

%

3.61

%






3.38

%

3.68

%




















Net charge-offs to average total 

















  net loans (annualized) 


.17

%

.29

%






.19

%

.29

%




















Net operating results (3)


































Net operating income  

$

279,838


300,968


-7

%


$

804,974


946,838


-15

%

Diluted net operating earnings per common share 


1.94


2.16


-10

%



5.62


6.87


-18

%

Return on (annualized):

















  Average tangible assets 


1.24

%

1.48

%






1.25

%

1.59

%



  Average tangible common equity 


13.80

%

17.64

%






13.84

%

19.66

%



Efficiency ratio 


59.67

%

56.03

%






60.96

%

54.27

%
























































At September 30













Loan quality


2014


2013


Change




























Nonaccrual loans 

$

847,784


915,871


-7

%









Real estate and other foreclosed assets 


67,629


89,203


-24

%









  Total nonperforming assets 

$

915,413


1,005,074


-9

%


























Accruing loans past due 90 days or more (4) 

$

312,990


339,792


-8

%


























Government guaranteed loans included in totals

















  above:

















  Nonaccrual loans 

$

68,586


68,519


-

%









  Accruing loans past due 90 days or more 


265,333


320,732


-17

%


























Renegotiated loans 

$

209,099


259,301


-19

%


























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

$

132,147


153,585


-14

%


























Purchased impaired loans (6):

















  Outstanding customer balance 

$

429,915


648,118


-34

%









  Carrying amount 


236,662


357,337


-34

%


























Nonaccrual loans to total net loans 


1.29

%

1.44

%





























Allowance for credit losses to total loans 


1.40

%

1.44

%














































(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)  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,


September 30,


June 30,


March 31,


December 31,


September 30,

 except per share


2014


2014


2014


2013


2013

















Performance
































Net income 

$

275,344



284,336



229,017



221,422



294,479


Net income available to common shareholders 


251,917



260,695



211,731



203,451



275,356


















Per common share:
















  Basic earnings 

$

1.92



1.99



1.63



1.57



2.13


  Diluted earnings 


1.91



1.98



1.61



1.56



2.11


  Cash dividends 

$

.70



.70



.70



.70



.70


















Common shares outstanding:
















  Average - diluted (1) 


132,128



131,828



131,126



130,464



130,265


  Period end (2) 


132,142



131,953



131,431



130,564



130,241


















Return on (annualized):
















  Average total assets 


1.17

%


1.27

%


1.07

%


1.03

%


1.39

%

  Average common shareholders' equity 


9.18

%


9.79

%


8.22

%


7.99

%


11.06

%

















Taxable-equivalent net interest income 

$

674,900



674,963



662,378



672,683



679,213


















Yield on average earning assets 


3.59

%


3.73

%


3.87

%


3.92

%


3.98

%

Cost of interest-bearing liabilities 


.54

%


.51

%


.55

%


.56

%


.58

%

Net interest spread 


3.05

%


3.22

%


3.32

%


3.36

%


3.40

%

Contribution of interest-free funds 


.18

%


.18

%


.20

%


.20

%


.21

%

Net interest margin 


3.23

%


3.40

%


3.52

%


3.56

%


3.61

%

















Net charge-offs to average total 
















  net loans (annualized) 


.17

%


.18

%


.20

%


.26

%


.29

%

















Net operating results (3)
































Net operating income 

$

279,838



289,974



235,162



227,797



300,968


Diluted net operating earnings per common share


1.94



2.02



1.66



1.61



2.16

Return on (annualized):
















  Average tangible assets 


1.24

%


1.35

%


1.15

%


1.11

%


1.48

%

  Average tangible common equity 


13.80

%


14.92

%


12.76

%


12.67

%


17.64

%

Efficiency ratio 


59.67

%


59.39

%


63.95

%


65.48

%


56.03

%























































September 30,


June 30,


March 31,


December 31,


September 30,

Loan quality


2014


2014


2014


2013


2013

















Nonaccrual loans 

$

847,784



880,134



890,893



874,156



915,871


Real estate and other foreclosed assets 


67,629



59,793



59,407



66,875



89,203


  Total nonperforming assets 

$

915,413



939,927



950,300



941,031



1,005,074


















Accruing loans past due 90 days or more (4)  

$

312,990



289,016



307,017



368,510



339,792


















Government guaranteed loans included in totals above:
































  Nonaccrual loans 

$

68,586



81,817



75,959



63,647



68,519


  Accruing loans past due 90 days or more 


265,333



275,846



291,418



297,918



320,732


















Renegotiated loans 

$

209,099



270,223



257,889



257,092



259,301


















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

$

132,147



134,580



120,996



130,162



153,585


















Purchased impaired loans (6):
















  Outstanding customer balance 

$

429,915



504,584



534,331



579,975



648,118


  Carrying amount 


236,662



282,517



303,388



330,792



357,337


















Nonaccrual loans to total net loans 


1.29

%


1.36

%


1.39

%


1.36

%


1.44

%

















Allowance for credit losses to total loans 


1.40

%


1.42

%


1.43

%


1.43

%


1.44

%

















(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)  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






Nine months ended






September 30






September 30




Dollars in thousands


2014


2013


Change




2014


2013


Change


















Interest income 

$

743,023


742,686


-

%


$

2,200,265


2,222,868


-1

%

Interest expense 


73,964


69,578


6




205,659


216,123


-5


















Net interest income 


669,059


673,108


-1




1,994,606


2,006,745


-1


















Provision for credit losses 


29,000


48,000


-40




91,000


143,000


-36


















Net interest income after
















   provision for credit losses 


640,059


625,108


2




1,903,606


1,863,745


2


















Other income
















     Mortgage banking revenues 


93,532


64,731


44




269,237


249,096


8


     Service charges on deposit accounts 


110,071


113,839


-3




321,637


336,505


-4


     Trust income  


128,671


123,801


4




379,816


370,132


3


     Brokerage services income 


17,416


16,871


3




51,403


49,840


3


     Trading account and foreign exchange gains 


6,988


8,987


-22




21,477


27,138


-21


     Gain on bank investment securities 


-


-


-




-


56,457


-


     Other-than-temporary impairment losses 
















        recognized in earnings 


-


-


-




-


(9,800)


-


     Equity in earnings of Bayview Lending Group LLC


(4,114)


(3,881)


-




(12,623)


(9,990)


-


     Other revenues from operations 


98,547


153,040


-36




296,683


349,581


-15


          Total other income 


451,111


477,388


-6




1,327,630


1,418,959


-6


















Other expense
















     Salaries and employee benefits 


348,776


339,332


3




1,059,815


1,019,019


4


     Equipment and net occupancy 


67,713


66,220


2




206,964


195,657


6


     Printing, postage and supplies 


9,184


9,752


-6




29,320


30,749


-5


     Amortization of core deposit and other 
















        intangible assets 


7,358


10,628


-31




26,654


36,473


-27


     FDIC assessments 


13,193


14,877


-11




43,836


52,010


-16


     Other costs of operations  


233,060


217,817


7




696,160


558,905


25


          Total other expense 


679,284


658,626


3




2,062,749


1,892,813


9


















Income before income taxes 


411,886


443,870


-7




1,168,487


1,389,891


-16


















Applicable income taxes


136,542


149,391


-9




379,790


472,833


-20


















Net income 

$

275,344


294,479


-6

%


$

788,697


917,058


-14

%

















 

M&T BANK CORPORATION













Condensed Consolidated Statement of Income, Five Quarter Trend


























Three months ended




September 30,


June 30,


March 31,


December 31,


September 30,

Dollars in thousands


2014


2014


2014


2013


2013

















Interest income 

$

743,023



734,290



722,952



734,466



742,686


Interest expense 


73,964



65,176



66,519



67,982



69,578


















Net interest income 


669,059



669,114



656,433



666,484



673,108


















Provision for credit losses 


29,000



30,000



32,000



42,000



48,000


















Net interest income after
















   provision for credit losses 


640,059



639,114



624,433



624,484



625,108


















Other income
















     Mortgage banking revenues 


93,532



95,656



80,049



82,169



64,731


     Service charges on deposit accounts 


110,071



107,368



104,198



110,436



113,839


     Trust income 


128,671



129,893



121,252



125,876



123,801


     Brokerage services income 


17,416



17,487



16,500



15,807



16,871


     Trading account and foreign exchange gains 


6,988



8,042



6,447



13,690



8,987


     Equity in earnings of Bayview Lending Group LLC 


(4,114)



(4,055)



(4,454)



(6,136)



(3,881)


     Other revenues from operations 


98,547



102,021



96,115



104,404



153,040


          Total other income 


451,111



456,412



420,107



446,246



477,388


















Other expense
















     Salaries and employee benefits 


348,776



339,713



371,326



336,159



339,332


     Equipment and net occupancy 


67,713



68,084



71,167



68,670



66,220


     Printing, postage and supplies 


9,184



9,180



10,956



8,808



9,752


     Amortization of core deposit and other 
















        intangible assets 


7,358



9,234



10,062



10,439



10,628


     FDIC assessments 


13,193



15,155



15,488



17,574



14,877


     Other costs of operations 


233,060



239,828



223,272



301,422



217,817


          Total other expense 


679,284



681,194



702,271



743,072



658,626


















Income before income taxes 


411,886



414,332



342,269



327,658



443,870


















Applicable income taxes 


136,542



129,996



113,252



106,236



149,391


















Net income 

$

275,344



284,336



229,017



221,422



294,479


































 

M&T BANK CORPORATION





Condensed Consolidated Balance Sheet















September 30




Dollars in thousands


2014


2013


Change










ASSETS
















Cash and due from banks 

$

1,445,877


1,941,944


-26

%









Interest-bearing deposits at banks 


7,676,064


1,925,811


299










Federal funds sold and agreements








  to resell securities 


77,766


117,809


-34










Trading account assets 


296,913


371,370


-20










Investment securities 


13,348,368


8,309,773


61










Loans and leases:
















   Commercial, financial, etc. 


19,112,009


17,911,149


7


   Real estate - commercial 


26,942,847


26,345,267


2


   Real estate - consumer      


8,663,408


9,228,003


-6


   Consumer 


10,854,095


10,174,623


7


     Total loans and leases, net of unearned discount 


65,572,359


63,659,042


3


        Less: allowance for credit losses 


918,633


916,370


-










  Net loans and leases 


64,653,726


62,742,672


3










Goodwill 


3,524,625


3,524,625


-










Core deposit and other intangible assets 


42,197


79,290


-47




.


.




Other assets 


6,162,806


5,414,191


14










  Total assets 

$

97,228,342


84,427,485


15

%

















LIABILITIES AND SHAREHOLDERS' EQUITY
















Noninterest-bearing deposits 

$

27,440,524


24,150,771


14

%








Interest-bearing deposits 


46,659,442


42,084,860


11










Deposits at Cayman Islands office 


241,536


316,510


-24










  Total deposits 


74,341,502


66,552,141


12










Short-term borrowings 


164,609


246,019


-33










Accrued interest and other liabilities 


1,327,524


1,491,797


-11










Long-term borrowings 


9,061,391


5,121,326


77










  Total liabilities 


84,895,026


73,411,283


16










Shareholders' equity:
















   Preferred 


1,231,500


879,010


40


   Common (1) 


11,101,816


10,137,192


10










     Total shareholders' equity 


12,333,316


11,016,202


12










  Total liabilities and shareholders' equity 

$

97,228,342


84,427,485


15

%

















(1)  Reflects accumulated other comprehensive income, net of applicable income tax effect, of $12.5 million at September 30, 2014, and accumulated other comprehensive loss, net of applicable income tax effect, $198.1 million at September 30, 2013.









 

M&T BANK CORPORATION

Condensed Consolidated Balance Sheet, Five Quarter Trend



















September 30,


June 30,



March 31,



December 31,



September 30,


Dollars in thousands



2014


2014



2014



2013



2013



















ASSETS


































Cash and due from banks 


$

1,445,877



1,827,197



1,671,052



1,573,361



1,941,944



















Interest-bearing deposits at banks 



7,676,064



3,032,530



3,299,185



1,651,138



1,925,811



















Federal funds sold and agreements to resell securities 



77,766



90,239



92,066



99,573



117,809



















Trading account assets 



296,913



313,325



314,807



376,131



371,370



















Investment securities 



13,348,368



12,120,195



10,364,249



8,796,497



8,309,773



















Loans and leases:


































   Commercial, financial, etc. 



19,112,009



19,105,892



18,896,070



18,705,216



17,911,149


   Real estate - commercial 



26,942,847



26,374,274



26,104,086



26,148,208



26,345,267


   Real estate - consumer 



8,663,408



8,656,766



8,774,095



8,928,221



9,228,003


   Consumer 



10,854,095



10,610,761



10,360,827



10,291,514



10,174,623


     Total loans and leases, net of unearned discount.



65,572,359



64,747,693



64,135,078



64,073,159



63,659,042


        Less: allowance for credit losses 



918,633



917,666



916,768



916,676



916,370



















  Net loans and leases 



64,653,726



63,830,027



63,218,310



63,156,483



62,742,672



















Goodwill 



3,524,625



3,524,625



3,524,625



3,524,625



3,524,625



















Core deposit and other intangible assets 



42,197



49,555



58,789



68,851



79,290



















Other assets 



6,162,806



6,047,309



5,987,277



5,915,732



5,414,191



















  Total assets 


$

97,228,342



90,835,002



88,530,360



85,162,391



84,427,485




































LIABILITIES AND SHAREHOLDERS' EQUITY


































Noninterest-bearing deposits 


$

27,440,524



26,088,763



25,244,200



24,661,007



24,150,771



















Interest-bearing deposits 


46,659,442



43,502,602



43,207,286



42,134,859



42,084,860



















Deposits at Cayman Islands office 



241,536



237,890



247,880



322,746



316,510



















  Total deposits 



74,341,502



69,829,255



68,699,366



67,118,612



66,552,141



















Short-term borrowings 



164,609



161,631



230,209



260,455



246,019



















Accrued interest and other liabilities 



1,327,524



1,283,430



1,462,725



1,368,922



1,491,797



















Long-term borrowings 



9,061,391



7,391,931



6,251,197



5,108,870



5,121,326



















  Total liabilities 



84,895,026



78,666,247



76,643,497



73,856,859



73,411,283



















Shareholders' equity:


































   Preferred 



1,231,500



1,231,500



1,231,500



881,500



879,010


   Common (1)  



11,101,816



10,937,255



10,655,363



10,424,032



10,137,192



















     Total shareholders' equity 



12,333,316



12,168,755



11,886,863



11,305,532



11,016,202



















  Total liabilities and shareholders' equity 


$

97,228,342



90,835,002



88,530,360



85,162,391



84,427,485




































(1)  Reflects accumulated other comprehensive income, net of applicable income tax effect, of $12.5 million at September 30, 2014 and $40.3 million at June 30, 2014, and accumulated other comprehensive loss, net of applicable income tax effect, of $25.3 million at March 31, 2014, $64.2 million at December 31, 2013 and $198.1 million at September 30, 2013.

 

M&T BANK CORPORATION












Condensed Consolidated Average Balance Sheet


























 and Annualized Taxable-equivalent Rates



























































Three months ended


Change in balance





Nine months ended








September 30,


September 30,


June 30,


September 30, 2014 from





September 30






Dollars in millions


2014


2013


2014


September 30,


June 30,



2014


2013


Change in




Balance


Rate


Balance


Rate


Balance


Rate


2013


2014



Balance


Rate


Balance 


Rate


balance


ASSETS






























































Interest-bearing deposits at banks 

$

5,083


.25

%

2,646


.25

%

4,080


.25

%

92

%


25

%


$

4,091


.25

%

1,866


.24

%

119

%
































Federal funds sold and agreements































  to resell securities 


80


.07


117


.08


90


.07


-32



-12




90


.07


133


.09


-32

































Trading account assets 


70


1.65


67


1.27


84


1.25


4



-17




75


1.83


76


2.10


-2

































Investment securities 


12,780


2.89


6,979


3.31


10,959


3.19


83



17




11,015


3.11


6,030


3.33


83

































Loans and leases, net of unearned discount































  Commercial, financial, etc. 


18,889


3.29


17,798


3.50


18,978


3.34


6



-




18,783


3.33


17,615


3.59


7


  Real estate - commercial


26,487


4.19


26,129


4.51


26,140


4.22


1



1




26,258


4.27


26,033


4.55


1


  Real estate - consumer 


8,634


4.17


9,636


4.17


8,746


4.36


-10



-1




8,740


4.24


10,522


4.10


-17


  Consumer 


10,753


4.52


11,295


4.57


10,479


4.52


-5



3




10,512


4.54


11,389


4.61


-8


     Total loans and leases, net 


64,763


4.00


64,858


4.21


64,343


4.05


-



1




64,293


4.06


65,559


4.26


-2

































  Total earning assets 


82,776


3.59


74,667


3.98


79,556


3.73


11



4




79,564


3.72


73,664


4.07


8

































Goodwill 


3,525




3,525




3,525




-



-




3,525




3,525




-

































Core deposit and other intangible assets 


45




84




53




-46



-15




54




96




-44

































Other assets 


6,899




5,735




6,739




20



2




6,809




5,815




17

































  Total assets 

$

93,245




84,011




89,873




11

%


4

%


$

89,952




83,100




8

%






























































































LIABILITIES AND SHAREHOLDERS' EQUITY






























































Interest-bearing deposits































  NOW accounts 

$

1,037


.15


924


.14


1,026


.13


12

%


1

%


$

1,017


.13


919


.14


11

%

  Savings deposits 


41,056


.11


36,990


.15


39,478


.11


11



4




39,640


.12


36,287


.15


9


  Time deposits 


3,227


.47


3,928


.62


3,350


.46


-18



-4




3,345


.46


4,190


.70


-20


  Deposits at Cayman Islands office 


325


.20


392


.22


339


.21


-17



-4




348


.21


524


.20


-34


     Total interest-bearing deposits 


45,645


.14


42,234


.19


44,193


.14


8



3




44,350


.14


41,920


.21


6

































Short-term borrowings 


181


.04


299


.08


220


.05


-39



-17




222


.05


425


.12


-48


Long-term borrowings 


8,547


2.69


5,010


3.89


6,525


3.05


71



31




6,999


3.02


4,918


4.09


42

































Total interest-bearing liabilities 


54,373


.54


47,543


.58


50,938


.51


14



7




51,571


.53


47,263


.61


9

































Noninterest-bearing deposits 


25,127




23,998




25,466




5



-1




24,915




23,570




6

































Other liabilities 


1,498




1,589




1,430




-6



5




1,486




1,676




-11

































  Total liabilities 


80,998




73,130




77,834




11



4




77,972




72,509




8

































Shareholders' equity 


12,247




10,881




12,039




13



2




11,980




10,591




13

































  Total liabilities and shareholders' equity 

$

93,245




84,011




89,873




11

%


4

%


$

89,952




83,100




8

%































































Net interest spread 




3.05




3.40




3.22











3.19




3.46




Contribution of interest-free funds 




.18




.21




.18











.19




.22




Net interest margin  




3.23

%



3.61

%



3.40

%










3.38

%



3.68

%


 

M&T BANK CORPORATION

Reconciliation of Quarterly GAAP to Non-GAAP Measures































Three months ended



Nine months ended




September 30



September 30




2014


2013



2014


2013


Income statement data











In thousands, except per share











Net income











Net income 

$

275,344


294,479


$

788,697


917,058


Amortization of core deposit and other











  intangible assets (1) 


4,494


6,489



16,277


22,269


Merger-related expenses (1) 


-


-



-


7,511


  Net operating income 

$

279,838


300,968


$

804,974


946,838


Earnings per common share











Diluted earnings per common share 

$

1.91


2.11


$

5.50


6.64


Amortization of core deposit and other











  intangible assets (1) 


.03


.05



.12


.17


Merger-related expenses (1) 


-


-



-


.06


  Diluted net operating earnings per common share 

$

1.94


2.16


$

5.62


6.87


Other expense











Other expense 

$

679,284


658,626


$

2,062,749


1,892,813


Amortization of core deposit and other











  intangible assets  


(7,358)


(10,628)



(26,654)


(36,473)


Merger-related expenses  


-


-



-


(12,364)


  Noninterest operating expense 

$

671,926


647,998


$

2,036,095


1,843,976


Merger-related expenses











Salaries and employee benefits 

$

-


-


$

-


836


Equipment and net occupancy 


-


-



-


690


Printing, postage and supplies 


-


-



-


1,825


Other costs of operations 


-


-



-


9,013


  Total 

$

-


-


$

-


12,364


Efficiency ratio











Noninterest operating expense (numerator) 

$

671,926


647,998


$

2,036,095


1,843,976


Taxable-equivalent net interest income 


674,900


679,213



2,012,241


2,025,517


Other income 


451,111


477,388



1,327,630


1,418,959


Less:  Gain on bank investment securities 


-


-



-


56,457


           Net OTTI losses recognized in earnings 


-


-



-


(9,800)


Denominator 

$

1,126,011


1,156,601


$

3,339,871


3,397,819


Efficiency ratio 


59.67

%

56.03

%


60.96

%

54.27

%






















Balance sheet data











In millions











Average assets











Average assets 

$

93,245


84,011


$

89,952


83,100


Goodwill 


(3,525)


(3,525)



(3,525)


(3,525)


Core deposit and other intangible assets 


(45)


(84)



(54)


(96)


Deferred taxes 


14


25



17


28


  Average tangible assets 

$

89,689


80,427


$

86,390


79,507


Average common equity











Average total equity 

$

12,247


10,881


$

11,980


10,591


Preferred stock 


(1,232)


(878)



(1,179)


(876)


  Average common equity 


11,015


10,003



10,801


9,715


Goodwill 


(3,525)


(3,525)



(3,525)


(3,525)


Core deposit and other intangible assets 


(45)


(84)



(54)


(96)


Deferred taxes 


14


25



17


28


  Average tangible common equity 

$

7,459


6,419


$

7,239


6,122













At end of quarter











Total assets











Total assets 

$

97,228


84,427







Goodwill 


(3,525)


(3,525)







Core deposit and other intangible assets 


(42)


(79)







Deferred taxes 


13


24







  Total tangible assets 

$

93,674


80,847







Total common equity











Total equity 

$

12,333


11,016







Preferred stock 


(1,232)


(879)







Undeclared dividends - cumulative preferred stock 


(2)


(4)







  Common equity, net of undeclared cumulative











    preferred dividends 


11,099


10,133







Goodwill 


(3,525)


(3,525)







Core deposit and other intangible assets


(42)


(79)







Deferred taxes 


13


24







  Total tangible common equity 

$

7,545


6,553





























(1) After any related tax effect.









 

 


M&T BANK CORPORATION















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


























































Three months ended







September 30,


June 30,


March 31,


December 31,


September 30,







2014


2014


2014


2013


2013



Income statement data















In thousands, except per share















Net income















Net income 



$

275,344


284,336


229,017


221,422


294,479



Amortization of core deposit and other














  intangible assets (1) 




4,494


5,638


6,145


6,375


6,489



  Net operating income 



$

279,838


289,974


235,162


227,797


300,968



Earnings per common share















Diluted earnings per common share 


$

1.91


1.98


1.61


1.56


2.11



Amortization of core deposit and other














  intangible assets (1) 




.03


.04


.05


.05


.05



  Diluted net operating earnings per common share 

$

1.94


2.02


1.66


1.61


2.16



Other expense















Other expense 



$

679,284


681,194


702,271


743,072


658,626



Amortization of core deposit and other














  intangible assets  




(7,358)


(9,234)


(10,062)


(10,439)


(10,628)



  Noninterest operating expense 



$

671,926


671,960


692,209


732,633


647,998



Efficiency ratio















Noninterest operating expense (numerator)

$

671,926


671,960


692,209


732,633


647,998



Taxable-equivalent net interest income 



674,900


674,963


662,378


672,683


679,213



Other income  




451,111


456,412


420,107


446,246


477,388



Denominator 



$

1,126,011


1,131,375


1,082,485


1,118,929


1,156,601



Efficiency ratio 




59.67

%

59.39

%

63.95

%

65.48

%

56.03

%































Balance sheet data















In millions















Average assets















Average assets 



$

93,245


89,873


86,665


85,330


84,011



Goodwill 




(3,525)


(3,525)


(3,525)


(3,525)


(3,525)



Core deposit and other intangible assets 


(45)


(53)


(64)


(74)


(84)



Deferred taxes 




14


16


20


23


25



  Average tangible assets 



$

89,689


86,311


83,096


81,754


80,427



Average common equity















Average total equity 



$

12,247


12,039


11,648


11,109


10,881



Preferred stock 




(1,232)


(1,231)


(1,072)


(881)


(878)



  Average common equity 




11,015


10,808


10,576


10,228


10,003



Goodwill 




(3,525)


(3,525)


(3,525)


(3,525)


(3,525)



Core deposit and other intangible assets 


(45)


(53)


(64)


(74)


(84)



Deferred taxes 




14


16


20


23


25



  Average tangible common equity 



$

7,459


7,246


7,007


6,652


6,419


















At end of quarter















Total assets















Total assets 



$

97,228


90,835


88,530


85,162


84,427



Goodwill 




(3,525)


(3,525)


(3,525)


(3,525)


(3,525)



Core deposit and other intangible assets 


(42)


(49)


(59)


(69)


(79)



Deferred taxes 




13


15


19


21


24



  Total tangible assets 



$

93,674


87,276


84,965


81,589


80,847



Total common equity















Total equity 



$

12,333


12,169


11,887


11,306


11,016



Preferred stock 




(1,232)


(1,232)


(1,232)


(882)


(879)



Undeclared dividends - cumulative preferred stock 


(2)


(3)


(3)


(3)


(4)



  Common equity, net of undeclared cumulative












    preferred dividends 




11,099


10,934


10,652


10,421


10,133



Goodwill 




(3,525)


(3,525)


(3,525)


(3,525)


(3,525)



Core deposit and other intangible assets 


(42)


(49)


(59)


(69)


(79)



Deferred taxes 




13


15


19


21


24



  Total tangible common equity 



$

7,545


7,375


7,087


6,848


6,553

































(1) After any related tax effect.














 

 

SOURCE M&T Bank Corporation

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