M&T Bank Corporation Announces First Quarter Results
M&T Bank Corporation Announces First Quarter Results Tuesday April 15, 8:34 am ET
BUFFALO, N.Y., April 15 /PRNewswire-FirstCall/ -- M&T Bank Corporation ("M&T")(NYSE: MTB - News) today reported its results of operations for the quarter ended March 31, 2008.
GAAP Results of Operations. Diluted earnings per share measured in accordance with generally accepted accounting principles ("GAAP") for the first quarter of 2008 were $1.82, up 16% from $1.57 in the corresponding 2007 quarter. GAAP-basis net income in the recent quarter increased 15% to $202 million from $176 million in the year-earlier period. GAAP-basis net income for the initial quarter of 2008 expressed as an annualized rate of return on average assets and average common stockholders' equity was 1.25% and 12.49%, respectively, compared with 1.25% and 11.38%, respectively, in the similar quarter of 2007.
M&T's financial results for the first three months of 2008 reflect $29 million, or $.26 of diluted earnings per share, resulting from M&T Bank's status as a member bank of Visa, including $20 million ($33 million pre-tax) or $.18 per share of gains realized from the mandatory partial redemption of Visa stock owned by M&T Bank and $9 million ($15 million pre-tax) or $.08 per share related to Visa's funding of an escrow account to provide for possible costs associated with pending litigation against Visa ("Covered Litigation"). That funding allowed member banks of Visa to reverse litigation-related accruals made in 2007 up to each bank's proportionate membership interest of the $3 billion used to fund the escrow account.
Reflecting on M&T's first quarter results, Rene F. Jones, Executive Vice President and Chief Financial Officer, commented, "M&T's financial results for the first three months of this year demonstrate a certain resilience to the ongoing disarray in the financial markets. Positive factors during the quarter included continued strong growth in our commercial and commercial real estate loan portfolios, while core deposit balances increased at a healthy rate. We also saw an improvement in our fee income, even after excluding the benefit from our share of the Visa IPO. These positive factors served to offset a continued upward trend in credit costs."
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 associated with merging acquired operations into M&T, since such expenses 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. Amortization of core deposit and other intangible assets, after tax effect, was $11 million ($.10 per diluted share) in each of the first quarters of 2008 and 2007. Merger-related acquisition and integration expenses during the three-month period ended March 31, 2008 related to the acquisition of Partners Trust Financial Group, Inc. on November 30, 2007 and the acquisition of the Mid-Atlantic retail banking franchise of First Horizon Bank on December 7, 2007 totaled $2 million, after tax effect, or $.02 of diluted earnings per share. There were no similar expenses in the first quarter 2007.
Diluted net operating earnings per share, which exclude the impact of amortization of