M&T Bank 1st-qtr profit more than doubles as bad loans decline, deposits rise

Monday, April 19, 2010

M&T 1Q profit more than doubles as sour loans fall

BUFFALO, N.Y. — Fewer souring loans and higher deposits help M&T Bank Corp. more than double its first-quarter profit. The results beat Wall Street expectations, and its shares rose.

For the three months ended March 31, M&T said its earnings available to common shareholders rose to $138.3 million, or $1.15 per share, compared with $55.3 million, or 49 cents per share, a year ago. There were 7 percent more shares outstanding in the recent quarter than last year.

Analysts polled by Thomson Reuters, on average, expected profit of 99 cents per share.

Net interest income, or money earned from deposits, rose 24 percent to $562 million, from $453 million in the 2009 first quarter. The bank said lower rates paid on deposits and long-term borrowings helped improved net interest margin to 3.78 percent from 3.19 percent.

Total deposits increased 12 percent to $47.5 billion, from $42.5 billion a year earlier.

The results were also helped by the acquisitions of Provident Bankshares Corp. and Bradford Bank. The buyout of Provident was completed in May. M&T took over the assets of Bradford Bank in August after it was shut down by regulators.

Non-interest income, or profit coming from fees and other charges, rose to $258 million, from $232 million last year.

M&T pared back its provision for credit losses, or money set aside to cover souring loans, by 34 percent to $105 million from $158 million a year ago.

Net charge-offs, or loans written off as uncollectible, slipped to $95 million from $100 million last year.

Non-performing assets, or loans that have fallen behind payments, rose 30 percent to $1.44 billion from $1.1 billion a year ago.

Loans past due 90 days or more and accruing interest totaled $203 million, including $195 million in loans guaranteed by government-related entities. That was up from $143 million last year.

M&T had total assets of $68.4 billion at March 31, up from $64.9 billion a year earlier.

In midday trading, M&T shares fell $1.05, or 1.3 percent, to $83.20. The stock has traded between $43.50 and $87.62 in the past 52 weeks.

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