M&T Bank Corporation Announces 2020 Fourth Quarter And Full-Year Results
01/21/2021 - 05:40 AM
BUFFALO, N.Y. , Jan. 21, 2021 /PRNewswire/ -- M&T Bank Corporation ("M&T") (NYSE: MTB) today reported its results of operations for 2020.
GAAP Results of Operations . Diluted earnings per common share measured in accordance with generally accepted accounting principles ("GAAP") were $3.52 $3.60 $2.75 $471 million $493 million $372 million 1.30% and 12.07% , respectively, compared with 1.60% and 12.95% , respectively, in the corresponding 2019 period and 1.06% and 9.53% , respectively, in the third quarter of 2020.
Darren J. King , M&T's Executive Vice President and Chief Financial Officer, commented, "In what has been an extremely challenging year, M&T responded quickly and effectively to take on those challenges while continuing to meet the needs of our customers through the extraordinary efforts of our employees. Although the effects of the pandemic and the low interest rate environment impacted M&T's financial results in 2020, we were pleased with the growth experienced in the mortgage banking and trust businesses, as well as the role we played in providing our customers the opportunity to participate in the Paycheck Protection Program."
Earnings Highlights
Change 4Q20 vs.
($ in millions, except per share data)
4Q20
4Q19
3Q20
4Q19
3Q20
Net income
$
471
$
493
$
372
-4
%
27
%
Net income available to common shareholders ̶ diluted
$
452
$
473
$
353
-5
%
28
%
Diluted earnings per common share
$
3.52
$
3.60
$
2.75
-2
%
28
%
Annualized return on average assets
1.30
%
1.60
%
1.06
%
Annualized return on average common equity
12.07
%
12.95
%
9.53
%
For the years ended December 31, 2020 and 2019, diluted earnings per common share were $9.94 $13.75 $1.35 billion $1.93 billion 1.00% and 8.72% , respectively, and 1.61% and 12.87% , respectively, in 2019.
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 and core deposit and other intangible asset balances, net of applicable deferred tax amounts) and expenses associated with merging acquired operations into M&T (when incurred), since such items are considered by management to be "nonoperating" in nature. The amounts of such "nonoperating" expenses are presented in the tables that accompany this release. 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 $3.54 $3.62 $2.77 $473 million $496 million $375 million 1.35% and 17.53% , respectively, 1.67% and 19.08% , respectively, in the similar quarter of 2019 and 1.10% and 13.94% , respectively, in the third quarter of 2020.
Diluted net operating earnings per common share for the years ended December 31, 2020 and 2019 were $10.02 $13.86 $1.36 billion $1.94 billion 1.04% and 12.79% , respectively, in 2020 and 1.69% and 19.08% , respectively, in 2019.
Taxable-equivalent Net Interest Income . Net interest income expressed on a taxable-equivalent basis totaled $993 million $1.01 billion 3.00% in the fourth quarter of 2020 from 3.64% in the year-earlier quarter, that was partially offset by the impact of a $21.3 billion 19% increase in average earning assets to $131.9 billion $110.6 billion $947 million 2.95% and average earning assets were $127.7 billion $29 million December 31, 2020 and September 30, 2020 , outstanding balances of PPP loans totaled $5.4 billion $6.5 billion New York , while the rise in average earning assets reflected higher balances of those same asset types. The improvement in the net interest margin in the recent quarter as compared with 2020's third quarter reflects a five basis point decline in average rates paid to customers on deposits, while the impacts of accelerated amortization of deferred PPP fees and increased levels of low-yielding balances held at the Federal Reserve Bank of New York were largely offsetting. Taxable-equivalent net interest income for the full year of 2020 was $3.88 billion $4.15 billion 3.16% in 2020 and 3.84% in 2019.
Taxable-equivalent Net Interest Income
Change 4Q20 vs.
($ in millions)
4Q20
4Q19
3Q20
4Q19
3Q20
Average earning assets
$
131,916
$
110,581
$
127,689
19
%
3
%
Net interest income ̶ taxable-equivalent
$
993
$
1,014
$
947
-2
%
5
%
Net interest margin
3.00
%
3.64
%
2.95
%
Provision for Credit Losses/Asset Quality . The provision for credit losses totaled $75 million $54 million $150 million $800 million December 31, 2020 , compared with $176 million January 1, 2020 . Those projections included estimates of the economic impact of the COVID-19 pandemic. Prior to 2020, the provision for credit losses reflected incurred losses only. Net loan charge-offs were $97 million $41 million $30 million 39% and .18% in the final quarters of 2020 and 2019, respectively, and .12% in the third quarter of 2020. Net loan charge-offs during 2020 and 2019 aggregated $247 million $144 million 26% and .16% , respectively, of average loans outstanding.
Loans classified as nonaccrual rose to $1.89 billion 1.92% of total loans outstanding at December 31, 2020 from $1.24 billion 1.26% of total loans at September 30, 2020 . That significant increase reflected the continuing impact of the pandemic on borrowers' ability to make contractual payments on their loans, particularly loans collateralized by hotels. Of the $653 million $530 million $963 million 1.06% of total loans. The adoption of the new accounting guidance previously mentioned resulted in an increase in nonaccrual loans on January 1, 2020 of $171 million $35 million $86 million $50 million
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 for credit losses totaled $1.74 billion 1.76% of loans outstanding at December 31, 2020, compared with $1.05 billion 1.16% at December 31, 2019, $1.76 billion 1.79% at September 30, 2020 and $1.18 billion 1.30% as of January 1, 2020 following adoption of the current expected credit loss accounting rules. The adoption of the amended accounting guidance resulted in an increase to the allowance of $132 million January 1, 2020 . The allowance at December 31, 2020 and September 30, 2020 represented 1.86% and 1.91% , respectively, of total loans on those dates, excluding outstanding balances of PPP loans.
Asset Quality Metrics
Change 4Q20 vs.
($ in millions)
4Q20
4Q19
3Q20
4Q19
3Q20
At end of quarter
Nonaccrual loans
$
1,893
$
963
$
1,240
97
%
53
%
Real estate and other foreclosed assets
$
35
$
86
$
50
-60
%
-30
%
Total nonperforming assets
$
1,928
$
1,049
$
1,290
84
%
49
%
Accruing loans past due 90 days or more (1)
$
859
$
519
$
527
66
%
63
%
Nonaccrual loans as % of loans outstanding
1.92
%
1.06
%
1.26
%
Allowance for credit losses
$
1,736
$
1,051
$
1,759
65
%
-1
%
Allowance for credit losses as % of loans outstanding
1.76
%
1.16
%
1.79
%
For the period
Provision for credit losses
$
75
$
54
$
150
39
%
-50
%
Net charge-offs
$
97
$
41
$
30
135
%
227
%
Net charge-offs as % of average loans (annualized)
.39
%
.18
%
.12
%
(1)
Predominantly government-guaranteed residential real estate loans. Prior to 2020, excludes loans acquired at a discount.
Noninterest Income and Expense . Noninterest income was $551 million $521 million $30 million
Noninterest Income
Change 4Q20 vs.
($ in millions)
4Q20
4Q19
3Q20
4Q19
3Q20
Mortgage banking revenues
$
140
$
118
$
153
19
%
-8
%
Service charges on deposit accounts
96
111
91
-14
%
5
%
Trust income
151
151
150
—
1
%
Brokerage services income
12
12
12
3
%
5
%
Trading account and foreign exchange gains
7
17
4
-57
%
79
%
Gain (loss) on bank investment securities
2
(6)
3
—
-42
%
Other revenues from operations
143
118
108
21
%
33
%
Total
$
551
$
521
$
521
6
%
6
%
Noninterest income improved to $2.09 billion $2.06 billion 24% rise in mortgage banking revenues, higher trust income and increased income from Bayview Lending Group LLC were partially offset by declines in service charges on deposit accounts, trading account and foreign exchange gains and loan syndication fees.
Noninterest expense totaled $845 million $824 million $827 million $842 million $819 million $823 million $14 million $3 million $16 million
Noninterest Expense
Change 4Q20 vs.
($ in millions)
4Q20
4Q19
3Q20
4Q19
3Q20
Salaries and employee benefits
$
476
$
469
$
479
1
%
-1
%
Equipment and net occupancy
84
83
81
2
%
4
%
Outside data processing and software
68
62
65
10
%
5
%
FDIC assessments
15
12
12
22
%
25
%
Advertising and marketing
18
27
12
-34
%
50
%
Printing, postage and supplies
9
10
9
-12
%
-12
%
Amortization of core deposit and other intangible assets
3
4
4
-27
%
-20
%
Other costs of operations
172
157
165
10
%
4
%
Total
$
845
$
824
$
827
3
%
2
%
For the year ended December 31, 2020 , noninterest expense aggregated $3.39 billion $3.47 billion $3.37 billion $3.45 billion $48 million
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 54.6% in the fourth quarter of 2020, 53.1% in the year-earlier quarter and 56.2% in the third quarter of 2020. The efficiency ratio for the full year 2020 was 56.3% , compared with 55.7% in 2019.
Balance Sheet . M&T had total assets of $142.6 billion $119.9 billion $138.6 billion $98.5 billion $90.9 billion $98.4 billion $3.7 billion $2.1 billion $5.4 billion $119.8 billion $94.8 billion $115.2 billion December 31, 2019 reflect increased commercial and consumer deposits, as well as higher deposits associated with residential mortgage servicing activities.
Total shareholders' equity was $16.2 billion 11.35% of total assets at December 31, 2020, $15.7 billion 13.11% at December 31, 2019 and $16.1 billion 11.61% at September 30, 2020. Common shareholders' equity was $14.9 billion $116.39 $14.5 billion $110.78 $14.9 billion $115.75 $80.52 $75.44 $79.85 10.0% at December 31, 2020, up from 9.81% three months earlier and 9.73% at December 31, 2019 .
Conference Call . Investors will have an opportunity to listen to M&T's conference call to discuss fourth 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 #1884289. The conference call will be webcast live through M&T's website at https://ir.mtb.com/events-presentations Thursday, January 28, 2021 by calling (800) 585-8367, or (404) 537-3406 for international participants, and by making reference to the ID #1884289. The event will also be archived and available by 3:00 p.m. today on M&T's website at https://ir.mtb.com/events-presentations
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 , Maryland , New Jersey , Pennsylvania , Delaware , Connecticut , Virginia , West Virginia 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 and related conference call may contain 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. Any statement that does not describe historical or current facts is a forward-looking statement, including statements regarding the potential effects of the Coronavirus Disease 2019 ("COVID-19") pandemic on M&T's business, financial condition, liquidity and results of operations. 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; risks and uncertainties relating to the impact of the COVID-19 pandemic; 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 or regulation; 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, regulatory agencies or legislation; 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.
Further, statements about the potential effects of the COVID-19 pandemic on M&T's business, financial condition, liquidity and results of operations may constitute forward-looking statements and are subject to the risk that the actual effects may differ, possibly materially, from what is reflected in those forward-looking statements due to factors and future developments that are uncertain, unpredictable and in many cases beyond M&T's control, including the scope and duration of the pandemic, actions taken by governmental authorities in response to the pandemic, and the direct and indirect impact of the pandemic on customers, clients, third parties and M&T.
M&T provides further detail regarding these risks and uncertainties in its 2019 Form 10-K and subsequent Form 10-Qs, including in the respective Risk Factors sections of such reports, as well as in subsequent SEC filings. Forward-looking statements speak only as of the date made, and M&T does not assume any duty and does not undertake to update forward-looking statements.
Financial Highlights
Three months ended
Year ended
December 31
December 31
Amounts in thousands, except per share
2020
2019
Change
2020
2019
Change
Performance
Net income
$
471,140
493,066
-4
%
$
1,353,152
1,929,149
-30
%
Net income available to common shareholders
451,869
473,372
-5
%
1,279,068
1,849,511
-31
%
Per common share:
Basic earnings
$
3.52
3.60
-2
%
$
9.94
13.76
-28
%
Diluted earnings
3.52
3.60
-2
%
9.94
13.75
-28
%
Cash dividends
$
1.10
1.10
—
$
4.40
4.10
7
%
Common shares outstanding:
Average - diluted (1)
128,379
131,549
-2
%
128,704
134,462
-4
%
Period end (2)
128,333
130,589
-2
%
128,333
130,589
-2
%
Return on (annualized):
Average total assets
1.30
%
1.60
%
1.00
%
1.61
%
Average common shareholders' equity
12.07
%
12.95
%
8.72
%
12.87
%
Taxable-equivalent net interest income
$
993,252
1,014,225
-2
%
$
3,883,605
4,153,127
-6
%
Yield on average earning assets
3.15
%
4.27
%
3.43
%
4.53
%
Cost of interest-bearing liabilities
.25
%
.97
%
.43
%
1.05
%
Net interest spread
2.90
%
3.30
%
3.00
%
3.48
%
Contribution of interest-free funds
.10
%
.34
%
.16
%
.36
%
Net interest margin
3.00
%
3.64
%
3.16
%
3.84
%
Net charge-offs to average total net loans (annualized)
.39
%
.18
%
.26
%
.16
%
Net operating results (3)
Net operating income
$
473,453
496,237
-5
%
$
1,364,145
1,943,508
-30
%
Diluted net operating earnings per common share
3.54
3.62
-2
%
10.02
13.86
-28
%
Return on (annualized):
Average tangible assets
1.35
%
1.67
%
1.04
%
1.69
%
Average tangible common equity
17.53
%
19.08
%
12.79
%
19.08
%
Efficiency ratio
54.6
%
53.1
%
56.3
%
55.7
%
At December 31
Loan quality
2020
2019
Change
Nonaccrual loans
$
1,893,299
963,112
97
%
Real estate and other foreclosed assets
34,668
85,646
-60
%
Total nonperforming assets
$
1,927,967
1,048,758
84
%
Accruing loans past due 90 days or more (4)
$
859,208
518,728
66
%
Government guaranteed loans included in totals above:
Nonaccrual loans
$
48,820
50,891
-4
%
Accruing loans past due 90 days or more
798,121
479,829
66
%
Renegotiated loans
$
238,994
234,424
2
%
Accruing loans acquired at a discount past due 90 days or more (5)
N/A
39,632
—
Purchased impaired loans (6):
Outstanding customer balance
N/A
415,413
—
Carrying amount
N/A
227,545
—
Nonaccrual loans to total net loans
1.92
%
1.06
%
Allowance for credit losses to total loans
1.76
%
1.16
%
(1)
Includes common stock equivalents.
(2)
Includes common stock issuable under deferred compensation plans.
(3)
Excludes amortization and balances related to goodwill and core deposit and other intangible assets and merger-related expenses which, except in the calculation of the efficiency ratio, are net of applicable income tax effects. Reconciliations of net income with net operating income appear herein.
(4)
Predominantly residential real estate loans. Prior to 2020, excludes loans acquired at a discount.
(5)
Prior to 2020, loans acquired at a discount that were recorded at fair value at acquisition date. This category does not include purchased impaired loans that are presented separately.
(6)
Prior to 2020, accruing loans acquired at a discount that were impaired at acquisition date and recorded at fair value.
Financial Highlights, Five Quarter Trend
Three months ended
December 31,
September 30,
June 30,
March 31,
December 31,
Amounts in thousands, except per share
2020
2020
2020
2020
2019
Performance
Net income
$
471,140
372,136
241,054
268,822
493,066
Net income available to common shareholders
451,869
353,400
223,099
250,701
473,372
Per common share:
Basic earnings
$
3.52
2.75
1.74
1.93
3.60
Diluted earnings
3.52
2.75
1.74
1.93
3.60
Cash dividends
$
1.10
1.10
1.10
1.10
1.10
Common shares outstanding:
Average - diluted (1)
128,379
128,355
128,333
129,755
131,549
Period end (2)
128,333
128,303
128,294
128,282
130,589
Return on (annualized):
Average total assets
1.30
%
1.06
%
.71
%
.90
%
1.60
%
Average common shareholders' equity
12.07
%
9.53
%
6.13
%
7.00
%
12.95
%
Taxable-equivalent net interest income
$
993,252
947,114
961,371
981,868
1,014,225
Yield on average earning assets
3.15
%
3.13
%
3.38
%
4.18
%
4.27
%
Cost of interest-bearing liabilities
.25
%
.30
%
.40
%
.83
%
.97
%
Net interest spread
2.90
%
2.83
%
2.98
%
3.35
%
3.30
%
Contribution of interest-free funds
.10
%
.12
%
.15
%
.30
%
.34
%
Net interest margin
3.00
%
2.95
%
3.13
%
3.65
%
3.64
%
Net charge-offs to average total net loans (annualized)
.39
%
.12
%
.29
%
.22
%
.18
%
Net operating results (3)
Net operating income
$
473,453
375,029
243,958
271,705
496,237
Diluted net operating earnings per common share
3.54
2.77
1.76
1.95
3.62
Return on (annualized):
Average tangible assets
1.35
%
1.10
%
.74
%
0.94
%
1.67
%
Average tangible common equity
17.53
%
13.94
%
9.04
%
10.39
%
19.08
%
Efficiency ratio
54.6
%
56.2
%
55.7
%
58.9
%
53.1
%
December 31,
September 30,
June 30,
March 31,
December 31,
Loan quality
2020
2020
2020
2020
2019
Nonaccrual loans
$
1,893,299
1,239,972
1,156,650
1,061,748
963,112
Real estate and other foreclosed assets
34,668
49,872
66,763
83,605
85,646
Total nonperforming assets
$
1,927,967
1,289,844
1,223,413
1,145,353
1,048,758
Accruing loans past due 90 days or more (4)
$
859,208
527,258
535,755
530,317
518,728
Government guaranteed loans included in totals above:
Nonaccrual loans
$
48,820
45,975
51,165
50,561
50,891
Accruing loans past due 90 days or more
798,121
505,446
454,269
464,243
479,829
Renegotiated loans
$
238,994
242,581
234,768
232,439
234,424
Accruing loans acquired at a discount past due 90 days or
more (5)
N/A
N/A
N/A
N/A
39,632
Purchased impaired loans (6):
Outstanding customer balance
N/A
N/A
N/A
N/A
415,413
Carrying amount
N/A
N/A
N/A
N/A
227,545
Nonaccrual loans to total net loans
1.92
%
1.26
%
1.18
%
1.13
%
1.06
%
Allowance for credit losses to total loans
1.76
%
1.79
%
1.68
%
1.47
%
1.16
%
(1)
Includes common stock equivalents.
(2)
Includes common stock issuable under deferred compensation plans.
(3)
Excludes amortization and balances related to goodwill and core deposit and other intangible assets and merger-related expenses which, except in the calculation of the efficiency ratio, are net of applicable income tax effects. Reconciliations of net income with net operating income appear herein.
(4)
Predominantly residential real estate loans. Prior to 2020, excludes loans acquired at a discount.
(5)
Prior to 2020, loans acquired at a discount that were recorded at fair value at acquisition date. This category does not include purchased impaired loans that are presented separately.
(6)
Prior to 2020, accruing loans acquired at a discount that were impaired at acquisition date and recorded at fair value.
Condensed Consolidated Statement of Income
Three months ended
Year ended
December 31
December 31
Dollars in thousands
2020
2019
Change
2020
2019
Change
Interest income
$
1,038,890
1,185,902
-12
%
$
4,192,712
4,879,593
-14
%
Interest expense
49,610
177,069
-72
326,395
749,329
-56
Net interest income
989,280
1,008,833
-2
3,866,317
4,130,264
-6
Provision for credit losses
75,000
54,000
39
800,000
176,000
355
Net interest income after provision for credit losses
914,280
954,833
-4
3,066,317
3,954,264
-22
Other income
Mortgage banking revenues
140,441
118,134
19
566,641
457,770
24
Service charges on deposit accounts
95,817
110,987
-14
370,788
432,978
-14
Trust income
151,314
151,525
—
601,884
572,608
5
Brokerage services income
12,234
11,891
3
47,428
48,922
-3
Trading account and foreign exchange gains
7,204
16,717
-57
40,536
62,044
-35
Gain (loss) on bank investment securities
1,619
(6,452)
—
(9,421)
18,037
—
Other revenues from operations
142,621
118,238
21
470,588
469,320
—
Total other income
551,250
521,040
6
2,088,444
2,061,679
1
Other expense
Salaries and employee benefits
476,110
469,080
1
1,950,692
1,900,797
3
Equipment and net occupancy
84,228
82,892
2
322,037
324,079
-1
Outside data processing and software
68,034
61,720
10
258,480
229,731
13
FDIC assessments
15,204
12,431
22
53,803
41,535
30
Advertising and marketing
17,832
27,063
-34
61,904
93,472
-34
Printing, postage and supplies
8,335
9,513
-12
39,869
39,893
—
Amortization of core deposit and other
intangible assets
3,129
4,305
-27
14,869
19,490
-24
Other costs of operations
172,136
156,679
10
683,586
819,685
-17
Total other expense
845,008
823,683
3
3,385,240
3,468,682
-2
Income before income taxes
620,522
652,190
-5
1,769,521
2,547,261
-31
Applicable income taxes
149,382
159,124
-6
416,369
618,112
-33
Net income
$
471,140
493,066
-4
%
$
1,353,152
1,929,149
-30
%
Condensed Consolidated Statement of Income, Five Quarter Trend
Three months ended
December 31,
September 30,
June 30,
March 31,
December 31,
Dollars in thousands
2020
2020
2020
2020
2019
Interest income
$
1,038,890
1,001,161
1,032,242
1,120,419
1,185,902
Interest expense
49,610
58,066
75,105
143,614
177,069
Net interest income
989,280
943,095
957,137
976,805
1,008,833
Provision for credit losses
75,000
150,000
325,000
250,000
54,000
Net interest income after provision for credit losses
914,280
793,095
632,137
726,805
954,833
Other income
Mortgage banking revenues
140,441
153,267
145,024
127,909
118,134
Service charges on deposit accounts
95,817
91,355
77,455
106,161
110,987
Trust income
151,314
149,937
151,882
148,751
151,525
Brokerage services income
12,234
11,602
10,463
13,129
11,891
Trading account and foreign exchange gains
7,204
4,026
8,290
21,016
16,717
Gain (loss) on bank investment securities
1,619
2,773
6,969
(20,782)
(6,452)
Other revenues from operations
142,621
107,601
87,190
133,176
118,238
Total other income
551,250
520,561
487,273
529,360
521,040
Other expense
Salaries and employee benefits
476,110
478,897
458,842
536,843
469,080
Equipment and net occupancy
84,228
81,080
77,089
79,640
82,892
Outside data processing and software
68,034
64,660
61,376
64,410
61,720
FDIC assessments
15,204
12,121
14,207
12,271
12,431
Advertising and marketing
17,832
11,855
9,842
22,375
27,063
Printing, postage and supplies
8,335
9,422
11,260
10,852
9,513
Amortization of core deposit and other intangible assets
3,129
3,914
3,913
3,913
4,305
Other costs of operations
172,136
164,825
170,513
176,112
156,679
Total other expense
845,008
826,774
807,042
906,416
823,683
Income before income taxes
620,522
486,882
312,368
349,749
652,190
Applicable income taxes
149,382
114,746
71,314
80,927
159,124
Net income
$
471,140
372,136
241,054
268,822
493,066
Condensed Consolidated Balance Sheet
December 31
Dollars in thousands
2020
2019
Change
ASSETS
Cash and due from banks
$
1,552,743
1,432,805
8
%
Interest-bearing deposits at banks
23,663,810
7,190,154
229
Federal funds sold
—
3,500
—
Trading account
1,068,581
470,129
127
Investment securities
7,045,697
9,497,251
-26
Loans and leases:
Commercial, financial, etc.
27,574,564
23,838,168
16
Real estate - commercial
37,637,889
35,541,914
6
Real estate - consumer
16,752,993
16,156,094
4
Consumer
16,570,421
15,386,693
8
Total loans and leases, net of unearned discount
98,535,867
90,922,869
8
Less: allowance for credit losses
1,736,387
1,051,071
65
Net loans and leases
96,799,480
89,871,798
8
Goodwill
4,593,112
4,593,112
—
Core deposit and other intangible assets
14,165
29,034
-51
Other assets
7,863,517
6,784,974
16
Total assets
$
142,601,105
119,872,757
19
%
LIABILITIES AND SHAREHOLDERS' EQUITY
Noninterest-bearing deposits
$
47,572,884
32,396,407
47
%
Interest-bearing deposits
71,580,750
60,689,618
18
Deposits at Cayman Islands office
652,104
1,684,044
-61
Total deposits
119,805,738
94,770,069
26
Short-term borrowings
59,482
62,363
-5
Accrued interest and other liabilities
2,166,409
2,337,490
-7
Long-term borrowings
4,382,193
6,986,186
-37
Total liabilities
126,413,822
104,156,108
21
Shareholders' equity:
Preferred
1,250,000
1,250,000
—
Common
14,937,283
14,466,649
3
Total shareholders' equity
16,187,283
15,716,649
3
Total liabilities and shareholders' equity
$
142,601,105
119,872,757
19
%
Condensed Consolidated Balance Sheet, Five Quarter Trend
December 31,
September 30,
June 30,
March 31,
December 31,
Dollars in thousands
2020
2020
2020
2020
2019
ASSETS
Cash and due from banks
$
1,552,743
1,489,232
1,354,815
1,298,192
1,432,805
Interest-bearing deposits at banks
23,663,810
20,197,937
20,888,341
8,896,307
7,190,154
Federal funds sold
—
—
—
—
3,500
Trading account
1,068,581
1,215,573
1,293,534
1,224,291
470,129
Investment securities
7,045,697
7,723,004
8,454,344
8,956,590
9,497,251
Loans and leases:
Commercial, financial, etc.
27,574,564
27,891,648
29,203,862
26,243,648
23,838,168
Real estate - commercial
37,637,889
37,582,084
37,159,451
36,684,106
35,541,914
Real estate - consumer
16,752,993
16,663,708
15,611,462
15,643,014
16,156,094
Consumer
16,570,421
16,309,608
15,782,773
15,571,507
15,386,693
Total loans and leases, net of unearned discount
98,535,867
98,447,048
97,757,548
94,142,275
90,922,869
Less: allowance for credit losses
1,736,387
1,758,505
1,638,236
1,384,366
1,051,071
Net loans and leases
96,799,480
96,688,543
96,119,312
92,757,909
89,871,798
Goodwill
4,593,112
4,593,112
4,593,112
4,593,112
4,593,112
Core deposit and other intangible assets
14,165
17,294
21,208
25,121
29,034
Other assets
7,863,517
6,702,048
6,812,303
6,826,311
6,784,974
Total assets
$
142,601,105
138,626,743
139,536,969
124,577,833
119,872,757
LIABILITIES AND SHAREHOLDERS' EQUITY
Noninterest-bearing deposits
$
47,572,884
44,201,670
45,397,843
35,554,715
32,396,407
Interest-bearing deposits
71,580,750
70,061,680
68,701,832
63,410,672
60,689,618
Deposits at Cayman Islands office
652,104
899,989
868,284
1,217,921
1,684,044
Total deposits
119,805,738
115,163,339
114,967,959
100,183,308
94,770,069
Short-term borrowings
59,482
46,123
52,298
59,180
62,363
Accrued interest and other liabilities
2,166,409
1,857,383
2,250,316
2,198,116
2,337,490
Long-term borrowings
4,382,193
5,458,885
6,321,291
6,321,435
6,986,186
Total liabilities
126,413,822
122,525,730
123,591,864
108,762,039
104,156,108
Shareholders' equity:
Preferred
1,250,000
1,250,000
1,250,000
1,250,000
1,250,000
Common
14,937,283
14,851,013
14,695,105
14,565,794
14,466,649
Total shareholders' equity
16,187,283
16,101,013
15,945,105
15,815,794
15,716,649
Total liabilities and shareholders' equity
$
142,601,105
138,626,743
139,536,969
124,577,833
119,872,757
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, 2020 from
December 31,
Change
Dollars in millions
2020
2019
2020
December 31,
September 30,
2020
2019
in
Balance
Rate
Balance
Rate
Balance
Rate
2019
2020
Balance
Rate
Balance
Rate
balance
ASSETS
Interest-bearing deposits at banks
$
22,206
.10
%
8,944
1.65
%
16,440
.10
%
148
%
35
%
$
15,329
.21
%
6,783
2.08
%
126
%
Federal funds sold and agreements
to resell securities
3,799
.12
1,279
1.68
5,113
.13
197
-26
2,717
.26
327
1.68
—
Trading account
50
1.97
70
4.36
50
1.62
-30
—
53
2.10
68
2.72
-22
Investment securities
7,195
2.25
10,044
2.51
7,876
1.95
-28
-9
8,165
2.16
11,550
2.50
-29
Loans and leases, net of unearned
discount
Commercial, financial, etc.
27,713
3.56
23,548
4.36
28,333
3.05
18
-2
27,520
3.42
23,306
4.80
18
Real estate - commercial
37,707
4.15
35,039
5.06
37,243
4.19
8
1
36,986
4.39
34,885
5.21
6
Real estate - consumer
16,761
3.56
16,330
4.15
16,558
3.69
3
1
16,215
3.82
16,665
4.25
-3
Consumer
16,485
4.78
15,327
5.26
16,076
4.76
8
3
15,884
4.92
14,638
5.43
9
Total loans and leases, net
98,666
4.01
90,244
4.77
98,210
3.89
9
—
96,605
4.13
89,494
4.99
8
Total earning assets
131,916
3.15
110,581
4.27
127,689
3.13
19
3
122,869
3.43
108,222
4.53
14
Goodwill
4,593
4,593
4,593
—
—
4,593
4,593
—
Core deposit and other intangible
assets
16
31
19
-50
-19
21
38
-44
Other assets
8,038
7,349
7,880
9
2
7,997
6,731
19
Total assets
$
144,563
122,554
140,181
18
%
3
%
$
135,480
119,584
13
%
LIABILITIES AND SHAREHOLDERS' EQUITY
Interest-bearing deposits
Savings and interest-checking
deposits
$
69,133
.11
57,103
.66
65,848
.14
21
%
5
%
$
63,590
.23
54,610
.67
16
%
Time deposits
4,113
.97
6,015
1.58
4,715
1.22
-32
-13
4,960
1.34
6,309
1.51
-21
Deposits at Cayman Islands
office
826
.11
1,716
1.14
957
.10
-52
-14
1,117
.36
1,367
1.60
-18
Total interest-bearing
deposits
74,072
.16
64,834
.76
71,520
.21
14
4
69,667
.31
62,286
.78
12
Short-term borrowings
64
.01
675
1.86
62
.01
-91
3
62
.05
1,059
2.34
-94
Long-term borrowings
5,294
1.47
6,941
2.83
5,499
1.51
-24
-4
5,803
1.88
7,703
3.11
-25
Total interest-bearing liabilities
79,430
.25
72,450
.97
77,081
.30
10
3
75,532
.43
71,048
1.05
6
Noninterest-bearing deposits
46,904
32,069
44,786
46
5
41,683
30,763
35
Other liabilities
2,016
2,203
2,241
-8
-10
2,274
2,055
11
Total liabilities
128,350
106,722
124,108
20
3
119,489
103,866
15
Shareholders' equity
16,213
15,832
16,073
2
1
15,991
15,718
2
Total liabilities and
shareholders' equity
$
144,563
122,554
140,181
18
%
3
%
$
135,480
119,584
13
%
Net interest spread
2.90
3.30
2.83
3.00
3.48
Contribution of interest-free funds
.10
.34
.12
.16
.36
Net interest margin
3.00
%
3.64
%
2.95
%
3.16
%
3.84
%
Reconciliation of Quarterly GAAP to Non-GAAP Measures
Three months ended
Year ended
December 31
December 31
2020
2019
2020
2019
Income statement data
In thousands, except per share
Net income
Net income
$
471,140
493,066
1,353,152
1,929,149
Amortization of core deposit and other intangible assets (1)
2,313
3,171
10,993
14,359
Net operating income
$
473,453
496,237
1,364,145
1,943,508
Earnings per common share
Diluted earnings per common share
$
3.52
3.60
9.94
13.75
Amortization of core deposit and other intangible assets (1)
.02
.02
.08
.11
Diluted net operating earnings per common share
$
3.54
3.62
10.02
13.86
Other expense
Other expense
$
845,008
823,683
3,385,240
3,468,682
Amortization of core deposit and other intangible assets
(3,129)
(4,305)
(14,869)
(19,490)
Noninterest operating expense
$
841,879
819,378
3,370,371
3,449,192
Efficiency ratio
Noninterest operating expense (numerator)
$
841,879
819,378
3,370,371
3,449,192
Taxable-equivalent net interest income
993,252
1,014,225
3,883,605
4,153,127
Other income
551,250
521,040
2,088,444
2,061,679
Less: Gain (loss) on bank investment securities
1,619
(6,452)
(9,421)
18,037
Denominator
$
1,542,883
1,541,717
5,981,470
6,196,769
Efficiency ratio
54.6
%
53.1
%
56.3
%
55.7
%
Balance sheet data
In millions
Average assets
Average assets
$
144,563
122,554
135,480
119,584
Goodwill
(4,593)
(4,593)
(4,593)
(4,593)
Core deposit and other intangible assets
(16)
(31)
(21)
(38)
Deferred taxes
4
8
5
10
Average tangible assets
$
139,958
117,938
130,871
114,963
Average common equity
Average total equity
$
16,213
15,832
15,991
15,718
Preferred stock
(1,250)
(1,250)
(1,250)
(1,272)
Average common equity
14,963
14,582
14,741
14,446
Goodwill
(4,593)
(4,593)
(4,593)
(4,593)
Core deposit and other intangible assets
(16)
(31)
(21)
(38)
Deferred taxes
4
8
5
10
Average tangible common equity
$
10,358
9,966
10,132
9,825
At end of quarter
Total assets
Total assets
$
142,601
119,873
Goodwill
(4,593)
(4,593)
Core deposit and other intangible assets
(14)
(29)
Deferred taxes
4
7
Total tangible assets
$
137,998
115,258
Total common equity
Total equity
$
16,187
15,717
Preferred stock
(1,250)
(1,250)
Common equity
14,937
14,467
Goodwill
(4,593)
(4,593)
Core deposit and other intangible assets
(14)
(29)
Deferred taxes
4
7
Total tangible common equity
$
10,334
9,852
(1)
After any related tax effect.
Reconciliation of Quarterly GAAP to Non-GAAP Measures, Five Quarter Trend
Three months ended
December 31,
September 30,
June 30,
March 31,
December 31,
2020
2020
2020
2020
2019
Income statement data
In thousands, except per share
Net income
Net income
$
471,140
372,136
241,054
268,822
493,066
Amortization of core deposit and other intangible assets (1)
2,313
2,893
2,904
2,883
3,171
Net operating income
$
473,453
375,029
243,958
271,705
496,237
Earnings per common share
Diluted earnings per common share
$
3.52
2.75
1.74
1.93
3.60
Amortization of core deposit and other intangible assets (1)
.02
.02
.02
.02
.02
Diluted net operating earnings per common share
$
3.54
2.77
1.76
1.95
3.62
Other expense
Other expense
$
845,008
826,774
807,042
906,416
823,683
Amortization of core deposit and other intangible assets
(3,129)
(3,914)
(3,913)
(3,913)
(4,305)
Noninterest operating expense
$
841,879
822,860
803,129
902,503
819,378
Efficiency ratio
Noninterest operating expense (numerator)
$
841,879
822,860
803,129
902,503
819,378
Taxable-equivalent net interest income
993,252
947,114
961,371
981,868
1,014,225
Other income
551,250
520,561
487,273
529,360
521,040
Less: Gain (loss) on bank investment securities
1,619
2,773
6,969
(20,782)
(6,452)
Denominator
$
1,542,883
1,464,902
1,441,675
1,532,010
1,541,717
Efficiency ratio
54.6
%
56.2
%
55.7
%
58.9
%
53.1
%
Balance sheet data
In millions
Average assets
Average assets
$
144,563
140,181
136,446
120,585
122,554
Goodwill
(4,593)
(4,593)
(4,593)
(4,593)
(4,593)
Core deposit and other intangible assets
(16)
(19)
(23)
(27)
(31)
Deferred taxes
4
5
6
7
8
Average tangible assets
$
139,958
135,574
131,836
115,972
117,938
Average common equity
Average total equity
$
16,213
16,073
15,953
15,720
15,832
Preferred stock
(1,250)
(1,250)
(1,250)
(1,250)
(1,250)
Average common equity
14,963
14,823
14,703
14,470
14,582
Goodwill
(4,593)
(4,593)
(4,593)
(4,593)
(4,593)
Core deposit and other intangible assets
(16)
(19)
(23)
(27)
(31)
Deferred taxes
4
5
6
7
8
Average tangible common equity
$
10,358
10,216
10,093
9,857
9,966
At end of quarter
Total assets
Total assets
$
142,601
138,627
139,537
124,578
119,873
Goodwill
(4,593)
(4,593)
(4,593)
(4,593)
(4,593)
Core deposit and other intangible assets
(14)
(17)
(21)
(25)
(29)
Deferred taxes
4
4
5
6
7
Total tangible assets
$
137,998
134,021
134,928
119,966
115,258
Total common equity
Total equity
$
16,187
16,101
15,945
15,816
15,717
Preferred stock
(1,250)
(1,250)
(1,250)
(1,250)
(1,250)
Common equity
14,937
14,851
14,695
14,566
14,467
Goodwill
(4,593)
(4,593)
(4,593)
(4,593)
(4,593)
Core deposit and other intangible assets
(14)
(17)
(21)
(25)
(29)
Deferred taxes
4
4
5
6
7
Total tangible common equity
$
10,334
10,245
10,086
9,954
9,852
(1)
After any related tax effect.
INVESTOR CONTACT:
Donald J. MacLeod
(716) 842-5138
MEDIA CONTACT:
C. Michael Zabel
(716) 842-5385
http://www.prnewswire.com/news-releases/mt-bank-corporation-announces-2020-fourth-quarter-and-full-year-results-301212443.html
SOURCE M&T Bank Corporation
