M&T BANK CORPORATION 
By BUFFALO, N.Y., Jan. 16, 2013 /PRNewswire/ -- M&T Bank Corporation ("M&T") (NYSE: MTB) today reported its results of operations for 2012.
GAAP Results of Operations. Diluted earnings per common share measured in accordance with generally accepted accounting principles ("GAAP") for the fourth quarter of 2012 rose 108% to $2.16 from $1.04 in the year-earlier quarter and were comparable to $2.17 in the third quarter of 2012. GAAP-basis net income in the recent quarter totaled $296 million, up from $148 million and $293 million in the fourth quarter of 2011 and the third quarter of 2012, 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 1.45% and 12.10%, respectively, compared with .75% and 6.12%, respectively, in the year-earlier quarter and 1.45% and 12.40%, respectively, in the third quarter of 2012.
For the year ended December 31, 2012, diluted earnings per common share were $7.54, up 19% from $6.35 in 2011. Net income rose to $1.03 billion in 2012 from $859 million in the previous year. Expressed as a rate of return on average assets and average common shareholders' equity, net income in 2012 was 1.29% and 10.96%, respectively, compared with 1.16% and 9.67%, respectively, in 2011.
Commenting on M&T's performance, Rene F. Jones, Executive Vice President and Chief Financial Officer, noted, "This was a year of tremendous accomplishment, in which M&T recorded record levels of net income and earnings per share. Revenues were up in most major categories, led by exceptional growth in mortgage banking. We continued to extend credit throughout the communities we serve, and as a result, loans rose an impressive $6.5 billion or 11% from the end of 2011, all while improving our capital base and expanding the services we offer our customers. The fourth quarter was a continuation of those trends, positioning us well for continued success in 2013. As we await shareholder and regulatory approvals for our proposed acquisition of Hudson City Bancorp, Inc., we are working diligently to prepare to welcome our new employees and customers to M&T."
While there were no unusual items included in M&T's results during the recent quarter, the fourth quarter of 2011 included several items of note: a $79 million (pre-tax effect) other-than-temporary impairment charge related to M&T's 20% investment in Bayview Lending Group LLC ("BLG"); $55 million of income in full settlement of a lawsuit arising from a 2007 investment in collateralized debt obligations; and a $30 million tax-deductible cash contribution to The M&T Charitable Foundation. The after-tax impact of those three items reduced the previous year's fourth quarter net income by $33 million, or $.26 of diluted earnings per common share.
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 $2.23 in the recent quarter, compared with $1.20 in the year-earlier period and $2.24 in the third quarter of 2012. Net operating income for the fourth quarter of 2012 was $305 million, improved from $168 million in the year-earlier quarter and $302 million in the third quarter of 2012. For the three months ended December 31, 2012, net operating income expressed as an annualized rate of return on average tangible assets and average tangible common shareholders' equity was 1.56% and 20.46%, respectively, compared with .89% and 12.36% in the corresponding 2011 period and 1.56% and 21.53%, respectively, in the third quarter of 2012.
Diluted net operating earnings per common share rose 20% to $7.88 in 2012 from $6.55 in 2011. Net operating income for 2012 and 2011 totaled $1.07 billion and $884 million, respectively. Net operating income in 2012 expressed as a rate of return on average tangible assets and average tangible common shareholders' equity was 1.40% and 19.42%, respectively, compared with 1.26% and 17.96%, respectively, in 2011.
Taxable-equivalent Net Interest Income. Taxable-equivalent net interest income aggregated $674 million in the recent quarter, up from $669 million in the third quarter of 2012. That improvement resulted from an increase in average earning assets, most notably a $1.6 billion rise in average loans and leases, partially offset by a 3 basis point narrowing of the net interest margin to 3.74% in the fourth quarter, compared with 3.77% in the immediately preceding quarter. Taxable-equivalent net interest income in the recent quarter increased $49 million from $625 million in the fourth quarter of 2011 reflecting a $2.9 billion rise in average earning assets and a 14 basis point widening of the net interest margin. For the year ended December 31, 2012, net interest income on a taxable-equivalent basis rose 9% to $2.62 billion from $2.42 billion in 2011 as a result of a 12%, or $6.5 billion, increase in average loans and leases. Significantly, the net interest margin held steady at 3.73% in 2012 as compared with the prior year despite a challenging low interest rate environment.
Provision for Credit Losses/Asset Quality. Credit quality remained strong. The provision for credit losses was $49 million during the fourth quarter of 2012, compared with $74 million in the year-earlier quarter and $46 million in the third quarter of 2012. Net charge-offs of loans were $44 million in the recent quarter, representing an annualized .27% of average loans outstanding, compared with $74 million or .50% in the final quarter of 2011 and $42 million or .26% in 2012's third quarter. The provision for credit losses declined 24% to $204 million for the year ended December 31, 2012 from $270 million in 2011. Net loan charge-offs for the year totaled $186 million, or .30% of average loans outstanding, compared with $265 million, or .47% of average loans in 2011.
Loans classified as nonaccrual totaled $1.01 billion, or 1.52% of total loans at December 31, 2012, compared with $1.10 billion or 1.83% a year earlier and $925 million or 1.44% at September 30, 2012. The increase in nonaccrual loans from September 30, 2012 resulted largely from the addition of $64 million of loans to a single borrower that are fully secured by residential real estate.
Assets taken in foreclosure of defaulted loans were $104 million at December 31, 2012, down from $157 million and $112 million at December 31, 2011 and September 30, 2012, 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. Reflecting those analyses, the allowance for credit losses was $926 million at December 31, 2012, compared with $908 million a year earlier and $921 million at September 30, 2012. The allowance expressed as a percentage of outstanding loans was 1.39% at the recent quarter-end, compared with 1.51% at December 31, 2011 and 1.44% at September 30, 2012.
Noninterest Income and Expense. Noninterest income totaled $453 million in the recently completed quarter, compared with $398 million and $446 million in the final quarter of 2011 and the third quarter of 2012, respectively. Reflected in those amounts were net losses from investment securities of $14 million, $25 million and $5 million, each predominantly due to other-than-temporary impairment charges. Also included in noninterest income in the fourth quarter of 2011 was the $55 million favorable litigation settlement related to M&T's 2007 investment in certain collateralized debt obligations, as previously noted.
Excluding the specific items referred to in the preceding paragraph, noninterest income was $468 million in the recent quarter, increasing from $368 million in the year-earlier quarter and $451 million in the third quarter of 2012. The rise in noninterest income in the recent quarter as compared with those earlier quarters was predominantly due to higher mortgage banking revenues.
Noninterest income aggregated $1.67 billion and $1.58 billion during the years ended December 31, 2012 and 2011, respectively. The most significant contributors to the rise in noninterest income in 2012 as compared with 2011 were higher mortgage banking revenues and trust income, the latter reflecting the full-year impact of the acquisition of Wilmington Trust Corporation ("Wilmington Trust"). Partially offsetting those factors were net gains from investment securities, the previously noted litigation settlement and merger-related gains, all reflected in M&T's 2011 results.
Noninterest expense in the fourth quarter of 2012 totaled $626 million, compared with $740 million in the year-earlier quarter and $616 million in 2012'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 and merger-related expenses. Exclusive of those expenses, noninterest operating expenses were $612 million in the recent quarter, compared with $706 million and $602 million in the fourth quarter of 2011 and the third quarter of 2012, respectively. Reflected in noninterest expense in the fourth quarter of 2011 was the aforementioned $79 million impairment charge related to BLG and the $30 million charitable contribution.
For the year ended December 31, 2012, noninterest expense aggregated $2.51 billion, compared with $2.48 billion in the previous year. Excluding those previously noted expenses considered to be nonoperating in nature, noninterest operating expenses were $2.44 billion in 2012 and $2.33 billion in 2011. That increase was largely attributable to the full-year impact of the operations obtained in the Wilmington Trust acquisition.
The efficiency ratio, or noninterest operating expenses divided by the sum of taxable-equivalent net interest income and noninterest income (exclusive of gains and losses from bank investment securities and merger-related gains), measures the relationship of operating expenses to revenues. As a result of revenue growth that has outpaced increases in operating expenses, M&T's efficiency ratio improved to 53.6% in the recent quarter from 67.4% in the year-earlier quarter and 53.7% in the third quarter of 2012. The efficiency ratio for the year ended December 31, 2012 was 56.2%, also improved, from 60.4% in 2011. The improved efficiency ratio reflects the significant progress made in the integration of the operations obtained in the May 2011 acquisition of Wilmington Trust.
Balance Sheet. M&T had total assets of $83.0 billion at December 31, 2012, up from $77.9 billion a year earlier. Loans and leases, net of unearned discount, totaled $66.6 billion at the 2012 year-end, $6.5 billion or 11% higher than $60.1 billion at December 31, 2011. The pace of growth in outstanding loans and leases during 2012's final quarter remained robust, increasing $2.5 billion, or 4%, from $64.1 billion at September 30, 2012. That growth reflects increases in commercial loans, commercial real estate loans and residential real estate loans. Total deposits were $65.6 billion at December 31, 2012, $6.2 billion or 10% higher than $59.4 billion a year earlier and $1.6 billion or 3% above $64.0 billion at September 30, 2012.
Total shareholders' equity rose 10% to $10.2 billion at December 31, 2012 from $9.3 billion a year earlier, representing 12.29% and 11.90% respectively, of total assets. Common shareholders' equity was $9.3 billion, or $72.73 per share at December 31, 2012, compared with $8.4 billion, or $66.82 per share, a year earlier. Tangible equity per common share rose 18% to $44.61 at December 31, 2012 from $37.79 a year earlier. 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 7.20% at December 31, 2012, compared with 6.40% and 7.04% at December 31, 2011 and September 30, 2012, respectively. M&T's estimated Tier 1 common ratio was 7.57% at December 31, 2012, compared with 6.86% and 7.46% at December 31, 2011 and September 30, 2012, respectively.
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 #86834125. 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 19, 2013 by calling (800)585-8367, or (404)537-3406 for international participants, and by making reference to ID #86834125. 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 2012 2011 Change 2012 2011 Change
---- ---- ------ ---- ---- ------
Performance
-----------
Net income $296,193 147,740 100% $1,029,498 859,479 20%
Net income available to common shareholders 276,605 129,804 113 953,429 781,765 22
Per common share:
Basic earnings $2.18 1.04 110% $7.57 6.37 19%
Diluted earnings 2.16 1.04 108 7.54 6.35 19
Cash dividends $.70 .70 - $2.80 2.80 -
Common shares outstanding:
Average - diluted (1) 127,800 124,736 2% 126,405 123,079 3%
Period end (2) 128,234 125,752 2 128,234 125,752 2
Return on (annualized):
Average total assets 1.45% .75% 1.29% 1.16%
Average common shareholders' equity 12.10% 6.12% 10.96% 9.67%
Taxable-equivalent net interest income $673,929 624,566 8% $2,624,907 2,415,632 9%
Yield on average earning assets 4.17% 4.17% 4.22% 4.35%
Cost of interest-bearing liabilities .67% .82% .74% .87%
Net interest spread 3.50% 3.35% 3.48% 3.48%
Contribution of interest-free funds .24% .25% .25% .25%
Net interest margin 3.74% 3.60% 3.73% 3.73%
Net charge-offs to average total
net loans (annualized) .27% .50% .30% .47%
Net operating results (3)
------------------------
Net operating income $304,657 168,410 81% $1,072,510 884,253 21%
Diluted net operating earnings per common share 2.23 1.20 86 7.88 6.55 20
Return on (annualized):
Average tangible assets 1.56% .89% 1.40% 1.26%
Average tangible common equity 20.46% 12.36% 19.42% 17.96%
Efficiency ratio 53.63% 67.38% 56.19% 60.43%
At December 31
--------------
Loan quality 2012 2011 Change
------------ ---- ---- ------
Nonaccrual loans $1,013,176 1,097,581 -8%
Real estate and other foreclosed assets 104,279 156,592 -33%
Total nonperforming assets $1,117,455 1,254,173 -11%
========== =========
Accruing loans past due 90 days or more (4) $358,397 287,876 24%
Government guaranteed loans included in totals
above:
Nonaccrual loans $57,420 40,529 42%
Accruing loans past due 90 days or more 316,403 252,503 25%
Renegotiated loans $271,971 214,379 27%
Acquired accruing loans past due 90 days or
more (5) $166,554 163,738 2%
Purchased impaired loans (6):
Outstanding customer balance $828,571 1,267,762 -35%
Carrying amount 447,114 653,362 -32%
Nonaccrual loans to total net loans 1.52% 1.83%
Allowance for credit losses to total loans 1.39% 1.51%
(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 2012 2012 2012 2012 2011
---- ---- ---- ---- ----
Performance
-----------
Net income $296,193 293,462 233,380 206,463 147,740
Net income available to common shareholders 276,605 273,896 214,716 188,241 129,804
Per common share:
Basic earnings $2.18 2.18 1.71 1.50 1.04
Diluted earnings 2.16 2.17 1.71 1.50 1.04
Cash dividends $.70 .70 .70 .70 .70
Common shares outstanding:
Average - diluted (1) 127,800 126,292 125,897 125,616 124,736
Period end (2) 128,234 127,461 126,645 126,534 125,752
Return on (annualized):
Average total assets 1.45% 1.45% 1.17% 1.06% .75%
Average common shareholders' equity 12.10% 12.40% 10.12% 9.04% 6.12%
Taxable-equivalent net interest income $673,929 669,256 654,628 627,094 624,566
Yield on average earning assets 4.17% 4.23% 4.25% 4.24% 4.17%
Cost of interest-bearing liabilities .67% .71% .76% .80% .82%
Net interest spread 3.50% 3.52% 3.49% 3.44% 3.35%
Contribution of interest-free funds .24% .25% .25% .25% .25%
Net interest margin 3.74% 3.77% 3.74% 3.69% 3.60%
Net charge-offs to average total
net loans (annualized) .27% .26% .34% .32% .50%
Net operating results (3)
------------------------
Net operating income $304,657 302,060 247,433 218,360 168,410
Diluted net operating earnings per common share 2.23 2.24 1.82 1.59 1.20
Return on (annualized):
Average tangible assets 1.56% 1.56% 1.30% 1.18% .89%
Average tangible common equity 20.46% 21.53% 18.54% 16.79% 12.36%
Efficiency ratio 53.63% 53.73% 56.86% 61.09% 67.38%
December 31, September 30, June 30, March 31, December 31,
Loan quality 2012 2012 2012 2012 2011
------------ ---- ---- ---- ---- ----
Nonaccrual loans $1,013,176 925,231 968,328 1,065,229 1,097,581
Real estate and other foreclosed assets 104,279 112,160 115,580 140,297 156,592
Total nonperforming assets $1,117,455 1,037,391 1,083,908 1,205,526 1,254,173
========== ========= ========= ========= =========
Accruing loans past due 90 days or more (4) $358,397 309,420 274,598 273,081 287,876
Government guaranteed loans included in totals
above:
Nonaccrual loans $57,420 54,583 48,712 44,717 40,529
Accruing loans past due 90 days or more 316,403 280,410 255,495 252,622 252,503
Renegotiated loans $271,971 266,526 267,111 213,024 214,379
Acquired accruing loans past due 90 days or more (5) $166,554 161,424 162,487 165,163 163,738
Purchased impaired loans (6):
Outstanding customer balance $828,571 978,731 1,037,458 1,158,829 1,267,762
Carrying amount 447,114 528,001 560,700 604,779 653,362
Nonaccrual loans to total net loans 1.52% 1.44% 1.54% 1.75% 1.83%
Allowance for credit losses to total loans 1.39% 1.44% 1.46% 1.49% 1.51%
(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 2012 2011 Change 2012 2011 Change
---- ---- ------ ---- ---- ------
Interest income $745,353 716,000 4% $2,941,685 2,792,087 5%
Interest expense 77,931 97,969 -20 343,169 402,331 -15
------ ------ ------- -------
Net interest income 667,422 618,031 8 2,598,516 2,389,756 9
Provision for credit losses 49,000 74,000 -34 204,000 270,000 -24
------ ------ ------- -------
Net interest income after
provision for credit losses 618,422 544,031 14 2,394,516 2,119,756 13
Other income
Mortgage banking revenues 116,546 40,573 187 349,064 166,021 110
Service charges on deposit accounts 112,364 104,071 8 446,698 455,095 -2
Trust income 116,915 113,820 3 471,852 332,385 42
Brokerage services income 14,872 13,341 11 59,059 56,470 5
Trading account and foreign exchange gains 10,356 7,971 30 35,634 27,224 31
Gain on bank investment securities - 1 - 9 150,187 -
Other-than-temporary impairment losses
recognized in earnings (14,491) (24,822) - (47,822) (77,035) -
Equity in earnings of Bayview Lending Group LLC (4,941) (5,419) - (21,511) (24,231) -
Other revenues from operations 101,543 148,918 -32 374,287 496,796 -25
------- ------- ------- -------
Total other income 453,164 398,454 14 1,667,270 1,582,912 5
Other expense
Salaries and employee benefits 323,010 312,528 3 1,314,540 1,203,993 9
Equipment and net occupancy 62,884 65,080 -3 257,551 249,514 3
Printing, postage and supplies 10,417 11,399 -9 41,929 40,917 2
Amortization of core deposit and other
intangible assets 13,865 17,162 -19 60,631 61,617 -2
FDIC assessments 23,398 27,826 -16 101,110 100,230 1
Other costs of operations 192,572 305,588 -37 733,499 821,797 -11
------- ------- ------- -------
Total other expense 626,146 739,583 -15 2,509,260 2,478,068 1
Income before income taxes 445,440 202,902 120 1,552,526 1,224,600 27
Applicable income taxes 149,247 55,162 171 523,028 365,121 43
------- ------ ------- -------
Net income $296,193 147,740 100% $1,029,498 859,479 20%
======== ======= ========== =======
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 2012 2012 2012 2012 2011
---- ---- ---- ---- ----
Interest income $745,353 744,851 737,386 714,095 716,000
Interest expense 77,931 82,129 89,403 93,706 97,969
------ ------ ------ ------ ------
Net interest income 667,422 662,722 647,983 620,389 618,031
Provision for credit losses 49,000 46,000 60,000 49,000 74,000
------ ------ ------ ------ ------
Net interest income after
provision for credit losses 618,422 616,722 587,983 571,389 544,031
Other income
Mortgage banking revenues 116,546 106,812 69,514 56,192 40,573
Service charges on deposit accounts 112,364 114,463 110,982 108,889 104,071
Trust income 116,915 115,709 122,275 116,953 113,820
Brokerage services income 14,872 14,114 16,172 13,901 13,341
Trading account and foreign exchange gains 10,356 8,469 6,238 10,571 7,971
Gain (loss) on bank investment securities - 372 (408) 45 1
Other-than-temporary impairment losses
recognized in earnings (14,491) (5,672) (16,173) (11,486) (24,822)
Equity in earnings of Bayview Lending Group LLC (4,941) (5,183) (6,635) (4,752) (5,419)
Other revenues from operations 101,543 96,649 89,685 86,410 148,918
------- ------ ------ ------ -------
Total other income 453,164 445,733 391,650 376,723 398,454
Other expense
Salaries and employee benefits 323,010 321,746 323,686 346,098 312,528
Equipment and net occupancy 62,884 64,248 65,376 65,043 65,080
Printing, postage and supplies 10,417 8,272 11,368 11,872 11,399
Amortization of core deposit and other
intangible assets 13,865 14,085 15,907 16,774 17,162
FDIC assessments 23,398 23,801 24,962 28,949 27,826
Other costs of operations 192,572 183,875 186,093 170,959 305,588
------- ------- ------- ------- -------
Total other expense 626,146 616,027 627,392 639,695 739,583
Income before income taxes 445,440 446,428 352,241 308,417 202,902
Applicable income taxes 149,247 152,966 118,861 101,954 55,162
------- ------- ------- ------- ------
Net income $296,193 293,462 233,380 206,463 147,740
======== ======= ======= ======= =======
M&T BANK CORPORATION
Condensed Consolidated Balance Sheet
December 31
-----------
Dollars in thousands 2012 2011 Change
---- ---- ------
ASSETS
Cash and due from banks $1,983,615 1,449,547 37%
Interest-bearing deposits at banks 129,945 154,960 -16
Federal funds sold and agreements
to resell securities 3,000 2,850 5
Trading account assets 488,966 561,834 -13
Investment securities 6,074,361 7,673,154 -21
Loans and leases:
Commercial, financial, etc 17,776,953 15,734,436 13
Real estate - commercial 25,993,790 24,411,114 6
Real estate - consumer 11,240,837 7,923,165 42
Consumer 11,559,377 12,027,290 -4
---------- ----------
Total loans and leases, net of unearned discount 66,570,957 60,096,005 11
Less: allowance for credit losses 925,860 908,290 2
------- -------
Net loans and leases 65,645,097 59,187,715 11
Goodwill 3,524,625 3,524,625 -
Core deposit and other intangible assets 115,763 176,394 -34
Other assets 5,043,431 5,193,208 -3
--------- ---------
Total assets $83,008,803 77,924,287 7%
=========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
Noninterest-bearing deposits $24,240,802 20,017,883 21%
Interest-bearing deposits 40,325,932 39,020,839 3
Deposits at Cayman Islands office 1,044,519 355,927 193
--------- -------
Total deposits 65,611,253 59,394,649 10
Short-term borrowings 1,074,482 782,082 37
Accrued interest and other liabilities 1,512,717 1,790,121 -15
Long-term borrowings 4,607,758 6,686,226 -31
--------- ---------
Total liabilities 72,806,210 68,653,078 6
Shareholders' equity:
Preferred 872,500 864,585 1
Common (1) 9,330,093 8,406,624 11
--------- ---------
Total shareholders' equity 10,202,593 9,271,209 10
---------- ---------
Total liabilities and shareholders' equity $83,008,803 77,924,287 7%
=========== ==========
(1) Reflects accumulated other comprehensive loss, net of applicable income tax effect, of $240.3 million
at December 31, 2012 and $356.4 million at December 31, 2011.
M&T BANK CORPORATION
Condensed Consolidated Balance Sheet, Five Quarter Trend
December 31, September 30, June 30, March 31, December 31,
Dollars in thousands 2012 2012 2012 2012 2011
---- ---- ---- ---- ----
ASSETS
Cash and due from banks $1,983,615 1,622,928 1,421,831 1,344,092 1,449,547
Interest-bearing deposits at banks 129,945 411,994 1,069,717 1,282,040 154,960
Federal funds sold and agreements
to resell securities 3,000 - 1,000 - 2,850
Trading account assets 488,966 526,844 544,938 517,620 561,834
Investment securities 6,074,361 6,624,004 7,057,300 7,195,296 7,673,154
Loans and leases:
Commercial, financial, etc 17,776,953 16,704,575 16,395,587 15,938,672 15,734,436
Real estate - commercial 25,993,790 24,970,416 24,898,707 24,486,555 24,411,114
Real estate - consumer 11,240,837 10,808,220 9,811,525 8,696,594 7,923,165
Consumer 11,559,377 11,628,744 11,745,453 11,799,929 12,027,290
---------- ---------- ---------- ---------- ----------
Total loans and leases, net of unearned discount 66,570,957 64,111,955 62,851,272 60,921,750 60,096,005
Less: allowance for credit losses 925,860 921,223 917,028 909,006 908,290
------- ------- ------- ------- -------
Net loans and leases 65,645,097 63,190,732 61,934,244 60,012,744 59,187,715
Goodwill 3,524,625 3,524,625 3,524,625 3,524,625 3,524,625
Core deposit and other intangible assets 115,763 129,628 143,713 159,619 176,394
Other assets 5,043,431 5,054,478 5,110,210 5,150,851 5,193,208
--------- --------- --------- --------- ---------
Total assets $83,008,803 81,085,233 80,807,578 79,186,887 77,924,287
=========== ========== ========== ========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
Noninterest-bearing deposits $24,240,802 22,968,401 22,854,794 20,648,970 20,017,883
Interest-bearing deposits 40,325,932 39,636,104 39,327,849 39,868,782 39,020,839
Deposits at Cayman Islands office 1,044,519 1,402,753 366,164 395,191 355,927
--------- --------- ------- ------- -------
Total deposits 65,611,253 64,007,258 62,548,807 60,912,943 59,394,649
Short-term borrowings 1,074,482 592,154 975,575 511,981 782,082
Accrued interest and other liabilities 1,512,717 1,570,758 1,965,421 1,856,749 1,790,121
Long-term borrowings 4,607,758 4,969,536 5,687,868 6,476,526 6,686,226
--------- --------- --------- --------- ---------
Total liabilities 72,806,210 71,139,706 71,177,671 69,758,199 68,653,078
Shareholders' equity:
Preferred 872,500 870,416 868,433 866,489 864,585
Common (1) 9,330,093 9,075,111 8,761,474 8,562,199 8,406,624
--------- --------- --------- --------- ---------
Total shareholders' equity 10,202,593 9,945,527 9,629,907 9,428,688 9,271,209
---------- --------- --------- --------- ---------
Total liabilities and shareholders' equity $83,008,803 81,085,233 80,807,578 79,186,887 77,924,287
=========== ========== ========== ========== ==========
(1) Reflects accumulated other comprehensive loss, net of applicable income tax effect, of $240.3 million at December 31, 2012,
$230.1 million at September 30, 2012, $277.8 million at June 30, 2012, $331.3 million at March 31, 2012 and $356.4 million at
December 31, 2011.
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, 2012 from
December 31,
Dollars in millions 2012 2011 2012 December 31, September 30, 2012 2011 Change in
---- ---- ---- ---- ----
Balance Rate Balance Rate Balance Rate 2011 2012 Balance Rate Balance Rate balance
------- ---- ------- ---- ------- ---- ---- ---- ------- ---- ------- ---- -------
ASSETS
Interest-bearing deposits at banks $273 .15% 1,973 .25% 298 .18% -86% -9% $528 .23% 1,195 .25% -56%
Federal funds sold and agreements
to resell securities 3 .57 6 .38 4 .55 -51 -28 4 .55 180 .11 -98
Trading account assets 97 1.45 82 1.30 94 1.13 18 3 96 1.45 94 1.50 2
Investment securities 6,295 3.31 7,633 3.48 6,811 3.39 -18 -8 6,969 3.44 7,064 3.82 -1
Loans and leases, net of unearned discount
Commercial, financial, etc. 16,995 3.68 15,392 3.78 16,504 3.73 10 3 16,336 3.71 14,655 3.85 11
Real estate - commercial 25,332 4.50 24,108 4.47 24,995 4.61 5 1 24,907 4.50 22,901 4.59 9
Real estate - consumer 11,087 4.10 7,480 4.77 10,296 4.29 48 8 9,727 4.33 6,778 4.93 43
Consumer 11,597 4.69 12,097 4.87 11,660 4.76 -4 -1 11,732 4.77 11,865 4.99 -1
Total loans and leases, net 65,011 59,077 4.39 63,455 4.34 10 2 62,702 56,199 4.53 12
------ ------ ------ ------ ------
Total earning assets 71,679 4.17 68,771 4.17 70,662 4.23 4 1 70,299 4.22 64,732 4.35 9
Goodwill 3,525 3,525 3,525 - - 3,525 3,525 -
Core deposit and other intangible assets 122 185 136 -34 -10 144 168 -14
Other assets 6,040 5,912 6,109 2 -1 6,015 5,552 8
----- ----- ----- ----- -----
Total assets $81,366 78,393 80,432 4% 1% $79,983 73,977 8%
======= ====== ====== ======= ======
LIABILITIES AND SHAREHOLDERS' EQUITY
Interest-bearing deposits
NOW accounts $881 .14 826 .15 875 .15 7% 1% $856 .16 753 .15 14%
Savings deposits 34,587 .19 32,179 .27 33,298 .20 7 4 33,398 .20 30,403 .28 10
Time deposits 4,727 .79 6,379 .93 5,164 .84 -26 -8 5,347 .86 6,480 1.10 -17
Deposits at Cayman Islands office 763 .18 512 .15 702 .19 49 9 605 .19 779 .12 -22
--- --- ---
Total interest-bearing deposits 40,958 .26 39,896 .37 40,039 .28 3 2 40,206 .29 38,415 .41 5
------ ------ ------ ------ ------
Short-term borrowings 677 .16 674 .10 976 .15 - -31 839 .15 827 .12 1
Long-term borrowings 4,510 4.52 6,574 3.66 5,006 4.27 -31 -10 5,527 4.08 6,959 3.50 -21
----- ----- ----- ----- -----
Total interest-bearing liabilities 46,145 .67 47,144 .82 46,021 .71 -2 - 46,572 .74 46,201 .87 1
Noninterest-bearing deposits 23,311 20,103 22,704 16 3 21,761 17,273 26
Other liabilities 1,805 1,733 1,918 4 -6 1,947 1,499 30
----- ----- ----- ----- -----
Total liabilities 71,261 68,980 70,643 3 1 70,280 64,973 8
Shareholders' equity 10,105 9,413 9,789 7 3 9,703 9,004 8
------ ----- ----- ----- -----
Total liabilities and shareholders' equity $81,366 78,393 80,432 4% 1% $79,983 73,977 8%
======= ====== ====== ======= ======
Net interest spread 3.50 3.35 3.52 3.48 3.48
Contribution of interest-free funds .24 .25 .25 .25 .25
Net interest margin 3.74% 3.60% 3.77% 3.73% 3.73%
M&T BANK CORPORATION
Reconciliation of GAAP to Non-GAAP Measures
Three months ended Year ended
December 31 December 31
----------- -----------
2012 2011 2012 2011
---- ---- ---- ----
Income statement data
---------------------
In thousands, except per share
Net income
Net income $296,193 147,740 $1,029,498 859,479
Amortization of core deposit and other
intangible assets (1) 8,464 10,476 37,011 37,550
Merger-related gain (1) - - - (64,930)
Merger-related expenses (1) - 10,194 6,001 52,154
Net operating income $304,657 168,410 $1,072,510 884,253
======== ======= ========== =======
Earnings per common share
Diluted earnings per common share $2.16 1.04 $7.54 6.35
Amortization of core deposit and other
intangible assets (1) .07 .08 .29 .30
Merger-related gain (1) - - - (.52)
Merger-related expenses (1) - .08 .05 .42
Diluted net operating earnings per common
share $2.23 1.20 $7.88 6.55
===== ==== ===== ====
Other expense
Other expense $626,146 739,583 $2,509,260 2,478,068
Amortization of core deposit and other
intangible assets (13,865) (17,162) (60,631) (61,617)
Merger-related expenses - (16,393) (9,879) (83,687)
Noninterest operating expense $612,281 706,028 $2,438,750 2,332,764
======== ======= ========== =========
Merger-related expenses
Salaries and employee benefits $ - 534 $4,997 16,131
Equipment and net occupancy - 189 15 412
Printing, postage and supplies - 1,475 - 2,663
Other costs of operations - 14,195 4,867 64,481
Total $ - 16,393 $9,879 83,687
=== ====== ====== ======
Efficiency ratio
Noninterest operating expense
(numerator) $612,281 706,028 $2,438,750 2,332,764
======== ======= ========== =========
Taxable-equivalent net interest income 673,929 624,566 2,624,907 2,415,632
Other income 453,164 398,454 1,667,270 1,582,912
Less: Gain (loss) on bank investment
securities - 1 9 150,187
Net OTTI losses recognized in earnings (14,491) (24,822) (47,822) (77,035)
Merger-related gain - - - 64,930
--- ------
Denominator $1,141,584 1,047,841 $4,339,990 3,860,462
========== ========= ========== =========
Efficiency ratio 53.63% 67.38% 56.19% 60.43%
===== ===== ===== =====
Balance sheet data
------------------
In millions
Average assets
Average assets $81,366 78,393 $79,983 73,977
Goodwill (3,525) (3,525) (3,525) (3,525)
Core deposit and other intangible assets (122) (185) (144) (168)
Deferred taxes 36 54 42 43
--- --- --- ---
Average tangible assets $77,755 74,737 $76,356 70,327
======= ====== ======= ======
Average common equity
Average total equity $10,105 9,413 $9,703 9,004
Preferred stock (872) (864) (869) (797)
Average common equity 9,233 8,549 8,834 8,207
Goodwill (3,525) (3,525) (3,525) (3,525)
Core deposit and other intangible assets (122) (185) (144) (168)
Deferred taxes 36 54 42 43
--- --- --- ---
Average tangible common equity $5,622 4,893 $5,207 4,557
====== ===== ====== =====
At end of quarter
Total assets
Total assets $83,009 77,924
Goodwill (3,525) (3,525)
Core deposit and other intangible assets (116) (176)
Deferred taxes 34 51
Total tangible assets $79,402 74,274
======= ======
Total common equity
Total equity $10,203 9,271
Preferred stock (873) (865)
Undeclared dividends -cumulative preferred
stock (3) (3)
Common equity, net of undeclared cumulative
preferred dividends 9,327 8,403
Goodwill (3,525) (3,525)
Core deposit and other intangible assets (116) (176)
Deferred taxes 34 51
Total tangible common equity $5,720 4,753
====== =====
(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,
2012 2012 2012 2012 2011
---- ---- ---- ---- ----
Income statement data
---------------------
In thousands, except per share
Net income
Net income $296,193 293,462 233,380 206,463 147,740
Amortization of core deposit and other
intangible assets (1) 8,464 8,598 9,709 10,240 10,476
Merger-related expenses (1) - - 4,344 1,657 10,194
Net operating income $304,657 302,060 247,433 218,360 168,410
======== ======= ======= ======= =======
Earnings per common share
Diluted earnings per common share $2.16 2.17 1.71 1.50 1.04
Amortization of core deposit and other
intangible assets (1) .07 .07 .08 .08 .08
Merger-related expenses (1) - - .03 .01 .08
Diluted net operating earnings per common share $2.23 2.24 1.82 1.59 1.20
Other expense
Other expense $626,146 616,027 627,392 639,695 739,583
Amortization of core deposit and other
intangible assets (13,865) (14,085) (15,907) (16,774) (17,162)
Merger-related expenses - - (7,151) (2,728) (16,393)
Noninterest operating expense $612,281 601,942 604,334 620,193 706,028
======== ======= ======= ======= =======
Merger-related expenses
Salaries and employee benefits $ - - 3,024 1,973 534
Equipment and net occupancy - - - 15 189
Printing, postage and supplies - - - - 1,475
Other costs of operations - - 4,127 740 14,195
Total $ - - 7,151 2,728 16,393
=== === ===== ===== ======
Efficiency ratio
Noninterest operating expense (numerator) $612,281 601,942 604,334 620,193 706,028
======== ======= ======= ======= =======
Taxable-equivalent net interest income 673,929 669,256 654,628 627,094 624,566
Other income 453,164 445,733 391,650 376,723 398,454
Less: Gain (loss) on bank investment securities - 372 (408) 45 1
Net OTTI losses recognized in earnings (14,491) (5,672) (16,173) (11,486) (24,822)
Denominator $1,141,584 1,120,289 1,062,859 1,015,258 1,047,841
========== ========= ========= ========= =========
Efficiency ratio 53.63% 53.73% 56.86% 61.09% 67.38%
===== ===== ===== ===== =====
Balance sheet data
------------------
In millions
Average assets
Average assets $81,366 80,432 80,087 78,026 78,393
Goodwill (3,525) (3,525) (3,525) (3,525) (3,525)
Core deposit and other intangible assets (122) (136) (151) (168) (185)
Deferred taxes 36 39 44 48 54
--- --- --- --- ---
Average tangible assets $77,755 76,810 76,455 74,381 74,737
======= ====== ====== ====== ======
Average common equity
Average total equity $10,105 9,789 9,536 9,376 9,413
Preferred stock (872) (870) (868) (866) (864)
Average common equity 9,233 8,919 8,668 8,510 8,549
Goodwill (3,525) (3,525) (3,525) (3,525) (3,525)
Core deposit and other intangible assets (122) (136) (151) (168) (185)
Deferred taxes 36 39 44 48 54
--- --- --- --- ---
Average tangible common equity $5,622 5,297 5,036 4,865 4,893
====== ===== ===== ===== =====
At end of quarter
Total assets
Total assets $83,009 81,085 80,808 79,187 77,924
Goodwill (3,525) (3,525) (3,525) (3,525) (3,525)
Core deposit and other intangible assets (116) (129) (143) (160) (176)
Deferred taxes 34 38 41 46 51
Total tangible assets $79,402 77,469 77,181 75,548 74,274
======= ====== ====== ====== ======
Total common equity
Total equity $10,203 9,945 9,630 9,429 9,271
Preferred stock (873) (870) (868) (867) (865)
Undeclared dividends - cumulative preferred stock (3) (4) (4) (3) (3)
---
Common equity, net of undeclared cumulative
preferred dividends 9,327 9,071 8,758 8,559 8,403
Goodwill (3,525) (3,525) (3,525) (3,525) (3,525)
Core deposit and other intangible assets (116) (129) (143) (160) (176)
Deferred taxes 34 38 41 46 51
Total tangible common equity $5,720 5,455 5,131 4,920 4,753
====== ===== ===== ===== =====
(1) After any related tax effect.
SOURCE M&T Bank Corporation
