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mtb-8k_20190117.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): January 17, 2019

M&T BANK CORPORATION

(Exact name of registrant as specified in its charter)

New York

(State or other jurisdiction of incorporation)

1-9861		16-0968385
(Commission File Number)		(I.R.S. Employer Identification No.)

One M&T Plaza, Buffalo, New York		14203
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (716) 635-4000

(NOT APPLICABLE)

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐	Pre-commencement communications pursuant to Rule 13e4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 2.02.Results of Operations and Financial Condition.

On January 17, 2019, M&T Bank Corporation announced its results of operations for the quarter and year ended December 31, 2018. The public announcement was made by means of a news release, the text of which is set forth in Exhibit 99.1 hereto.

The information in this Form 8-K, including Exhibit 99.1 attached hereto, is being furnished under Item 2.02 and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”), or otherwise subject to the liability of such section, nor shall it be deemed incorporated by reference in any filing of M&T Bank Corporation under the Securities Act of 1933 or the Exchange Act, regardless of any general incorporation language in such filing, unless expressly incorporated by specific reference in such filing.

Item 9.01.

Financial Statements and Exhibits.

(d) Exhibits.

Exhibit

No.

Exhibit Description

99.1

News Release dated January 17, 2019.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	M&T BANK CORPORATION

Date: January 17, 2019	By:	/s/ Darren J. King
		Darren J. King
		Executive Vice President and Chief Financial Officer

mtb-ex991_6.htm

Exhibit 99.1

INVESTOR CONTACT:

Donald J. MacLeod

FOR IMMEDIATE RELEASE:

(716) 842-5138

January 17, 2019

MEDIA CONTACT:

C. Michael Zabel

(716) 842-5385

M&T BANK CORPORATION ANNOUNCES 2018 FOURTH QUARTER AND FULL-YEAR RESULTS

BUFFALO, NEW YORK -- M&T Bank Corporation (“M&T”) (NYSE: MTB) today reported its results of operations for 2018.

GAAP Results of Operations. Diluted earnings per common share measured in accordance with generally accepted accounting principles (“GAAP”) were $3.76 in the fourth quarter of 2018, 87% higher than $2.01 in the year-earlier quarter and 7% above $3.53 in the third quarter of 2018. GAAP-basis net income in the recent quarter was $546 million, up from $322 million in the fourth quarter of 2017 and $526 million in the third 2018 quarter. GAAP-basis net income for the fourth quarter of 2018 expressed as an annualized rate of return on average assets and average common shareholders' equity was 1.84% and 14.80%, respectively, improved from 1.06% and 8.03%, respectively, in the corresponding 2017 period and 1.80% and 14.08%, respectively, in the third quarter of 2018. In December 2018, M&T received approval from the Internal Revenue Service to change its tax return treatment for certain loan fees retroactive to 2017. Given the reduction of the Federal income tax rate in 2018, that change in treatment resulted in a $15 million reduction of income tax expense in the recent quarter. The impact of that benefit on net income was offset by a $20 million contribution to The M&T Charitable Foundation in the fourth quarter that, after applicable tax effect, reduced net income by $15 million. As compared with 2017, income tax expense in all 2018 periods reflects the reduction of the corporate Federal income tax rate from 35% to 21%. M&T’s results in 2017’s final quarter were reduced by $98 million, or $.65 of diluted earnings per common share, predominantly reflecting the impact of that lower tax rate on the carrying values of M&T’s net deferred tax assets and other items.

Commenting on M&T’s financial performance, Darren J. King, Executive Vice President and Chief Financial Officer, noted, “We are extremely pleased with M&T’s performance this past quarter and for 2018 as a whole. Our results reflect a continuation of many positive factors including growth in interest and noninterest revenues, subdued credit costs and well-controlled expenses. Average balances of loans to commercial customers rose in the recent quarter and year-end commercial balances grew $2.2 billion from the end of the third quarter. We believe M&T is well positioned as we enter 2019.”

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M&T BANK CORPORATION

Earnings Highlights

										Change 4Q18 vs.
($ in millions, except per share data)	4Q18			4Q17			3Q18			4Q17			3Q18

Net income	$	546		$	322		$	526			69	%		4	%
Net income available to common shareholders ̶ diluted	$	525		$	302		$	505			74	%		4	%
Diluted earnings per common share	$	3.76		$	2.01		$	3.53			87	%		7	%
Annualized return on average assets		1.84	%		1.06	%		1.80	%
Annualized return on average common equity		14.80	%		8.03	%		14.08	%

Diluted earnings per common share were $12.74 for the year ended December 31, 2018, 46% higher than $8.70 in 2017. GAAP-basis net income for 2018 aggregated $1.92 billion, up 36% from $1.41 billion in 2017. Expressed as a rate of return on average assets and average common shareholders’ equity, GAAP-basis net income for 2018 was 1.64% and 12.82%, respectively, improved from 1.17% and 8.87%, respectively, in 2017.

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 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 $3.79 in the recent quarter, compared with $2.04 in the fourth quarter of 2017 and $3.56 in the third quarter of 2018. Net operating income for the fourth quarter of 2018 was $550 million, compared with $327 million in the year-earlier period and $531 million in 2018’s third quarter. Expressed as an annualized rate of return on average tangible assets and average tangible common shareholders' equity, net operating income in the recent quarter was 1.93% and 22.16%, respectively, compared with 1.12% and 11.77%, respectively, in the corresponding 2017 quarter and 1.89% and 21.00%, respectively, in the third quarter of 2018.

For the year ended December 31, 2018, diluted net operating earnings per common share were $12.86, compared with $8.82 in 2017. Net operating income in 2018 increased 36% to $1.94 billion from $1.43 billion in 2017. Net operating income expressed as a rate of return on average tangible assets and average tangible common shareholders’ equity was 1.72% and 19.09%, respectively, in 2018, compared with 1.23% and 13.00%, respectively, in 2017.

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M&T BANK CORPORATION

Taxable-equivalent Net Interest Income. Net interest income expressed on a taxable-equivalent basis totaled $1.06 billion in 2018’s fourth quarter, improved 9% from $980 million in the year-earlier quarter and 3% above $1.03 billion in the third quarter of 2018. That growth predominantly resulted from a widening of the net interest margin to 3.92% in the recent quarter from 3.56% in the fourth quarter of 2017 and 3.88% in the third quarter of 2018 that reflects generally higher interest rates. Taxable-equivalent net interest income for the full year of 2018 increased 7% to $4.09 billion from $3.82 billion in 2017. The net interest margin was 3.83% in 2018 and 3.47% in 2017.


Taxable-equivalent Net Interest Income

										Change 4Q18 vs.
($ in millions)	4Q18			4Q17			3Q18			4Q17			3Q18

Average earning assets	$	107,785		$	109,412		$	105,835			-1	%		2	%
Net interest income ̶ taxable-equivalent	$	1,065		$	980		$	1,035			9	%		3	%
Net interest margin		3.92	%		3.56	%		3.88	%

Provision for Credit Losses/Asset Quality. The provision for credit losses was $38 million in the fourth quarter of 2018, compared with $31 million in the year-earlier quarter and $16 million in 2018’s third quarter. Net loan charge-offs were $38 million during the recent quarter, compared with $27 million in the fourth quarter of 2017 and $16 million in the third quarter of 2018. The lower net charge-offs in 2018’s third quarter reflected significantly higher recoveries of previously charged-off loans. Expressed as an annualized percentage of average loans outstanding, net charge-offs were .17% and .12% in the final quarters of 2018 and 2017, respectively, and .07% in the third quarter of 2018. The provision for credit losses was $132 million for the year ended December 31, 2018, compared with $168 million in 2017. Net loan charge-offs during 2018 and 2017 aggregated $130 million and $140 million, respectively, or .15% and .16%, respectively, of average loans outstanding.

Loans classified as nonaccrual totaled $894 million or 1.01% of total loans outstanding at December 31, 2018, compared with $883 million or 1.00% a year earlier and $871 million or 1.00% at September 30, 2018. Assets taken in foreclosure of defaulted loans were $78 million at December 31, 2018, improved from $112 million at December 31, 2017 and $87 million at September 30, 2018.

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 $1.02 billion at each of December 31, 2018, December 31, 2017 and September 30, 2018. As a percentage of loans outstanding, the allowance was 1.15% and 1.16% at December 31, 2018 and 2017, respectively, and 1.18% at September 30, 2018.

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M&T BANK CORPORATION

Asset Quality Metrics

										Change 4Q18 vs.
($ in millions)	4Q18			4Q17			3Q18			4Q17			3Q18

At end of quarter
Nonaccrual loans	$	894		$	883		$	871			1	%		3	%
Real estate and other foreclosed assets	$	78		$	112		$	87			-30	%		-10	%
Total nonperforming assets	$	972		$	995		$	958			-2	%		1	%
Accruing loans past due 90 days or more (1)	$	223		$	244		$	254			-9	%		-13	%
Nonaccrual loans as % of loans outstanding		1.01	%		1.00	%		1.00	%

Allowance for credit losses	$	1,019		$	1,017		$	1,019			—			—
Allowance for credit losses as % of loans outstanding		1.15	%		1.16	%		1.18	%

For the period
Provision for credit losses	$	38		$	31		$	16			23	%		138	%
Net charge-offs	$	38		$	27		$	16			40	%		141	%
Net charge-offs as % of average loans (annualized)		.17	%		.12	%		.07	%

(1)	Excludes loans acquired at a discount. Predominantly residential real estate loans.

Noninterest Income and Expense. Noninterest income totaled $481 million in the recent quarter, little changed from $484 million in the fourth quarter of 2017, but up from $459 million in the third quarter of 2018. As compared with the fourth quarter of 2017, higher credit-related fees, trading account and foreign exchange gains, and trust income in the recent quarter were offset by a decline in residential mortgage banking revenues and lower gains on investment securities. Higher trading account and foreign exchange gains, valuation gains on equity securities and increased commercial mortgage banking revenues in the recent quarter contributed to the improvement from the third quarter of 2018.

Noninterest Income

								Change 4Q18 vs.
($ in millions)	4Q18		4Q17		3Q18			4Q17			3Q18

Mortgage banking revenues	$	92	$	96	$	88			-4	%		4	%
Service charges on deposit accounts		109		108		109			1	%		—
Trust income		135		130		133			4	%		1	%
Brokerage services income		13		13		12			—			4	%
Trading account and foreign exchange gains		17		10		6			58	%		173	%
Gain (loss) on bank investment securities		4		21		(3	)		-80	%		—
Other revenues from operations		111		106		114			5	%		-2	%
Total other income	$	481	$	484	$	459			-1	%		5	%

Noninterest income aggregated $1.86 billion in 2018 and $1.85 billion in 2017. Higher trust income in 2018 was largely offset by the impact of investment securities gains in 2017.

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M&T BANK CORPORATION

Noninterest expense aggregated $802 million in the fourth quarter of 2018, $796 million in the year-earlier quarter and $776 million in the third quarter of 2018. Excluding expenses considered to be nonoperating in nature, such as amortization of core deposit and other intangible assets, noninterest operating expenses were $797 million in the recent quarter, $789 million in the fourth quarter of 2017 and $770 million in the third quarter of 2018. Higher salaries and employee benefits expenses in the recent quarter were largely offset by lower charitable contributions and FDIC assessments as compared with the fourth quarter of 2017. The higher level of noninterest expense in the final 2018 quarter as compared with the third quarter of 2018 was attributable to increased charitable contributions and costs for professional services and salaries and employee benefits, that were partially offset by lower FDIC assessments.

Noninterest Expense

							Change 4Q18 vs.
($ in millions)	4Q18		4Q17		3Q18		4Q17			3Q18

Salaries and employee benefits	$	439	$	402	$	431		9	%		2	%
Equipment and net occupancy		74		71		77		3	%		-5	%
Outside data processing and software		50		50		51		—			-1	%
FDIC assessments		10		24		19		-59	%		-48	%
Advertising and marketing		26		19		22		34	%		19	%
Printing, postage and supplies		9		9		9		2	%		-1	%
Amortization of core deposit and other intangible assets		5		7		6		-24	%		-13	%
Other costs of operations		189		214		161		-11	%		18	%
Total other expense	$	802	$	796	$	776		1	%		3	%

For the year ended December 31, 2018, noninterest expense aggregated $3.29 billion, compared with $3.14 billion in 2017. Noninterest operating expenses were $3.26 billion and $3.11 billion in 2018 and 2017, respectively. The higher level of such expenses in 2018 resulted largely from increased costs for salaries and employee benefits, professional services and legal-related matters.

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 51.7% in the fourth quarter of 2018, 54.7% in the corresponding 2017 quarter and 51.4% in the third quarter of 2018. The efficiency ratio for the full year 2018 was 54.8%, improved from 55.1% in 2017.

Balance Sheet. M&T had total assets of $120.1 billion at December 31, 2018, compared with $118.6 billion and $116.8 billion at December 31, 2017 and September 30, 2018, respectively. Loans and leases, net of unearned discount, were $88.5 billion at December 31, 2018, $88.0 billion at December 31, 2017 and $86.7 billion at September 30, 2018. Contributing to the higher outstanding balances of loans and leases at the recent quarter-end as compared with September 30, 2018 were growth in commercial loans and commercial real estate loans that was partially offset by acquired residential mortgage loan repayments. Total deposits were $90.2

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M&T BANK CORPORATION

billion at the recent year-end, compared with $92.4 billion at December 31, 2017 and $89.1 billion at September 30, 2018.

Total shareholders' equity was $15.5 billion at December 31, 2018 and $16.3 billion a year earlier, representing 12.87% and 13.70%, respectively, of total assets. Total shareholders’ equity was $15.4 billion, or 13.21% of total assets at September 30, 2018. Common shareholders' equity was $14.2 billion, or $102.69 per share, at December 31, 2018, compared with $15.0 billion, or $100.03 per share, a year-earlier and $14.2 billion, or $100.38 per share, at September 30, 2018. Tangible equity per common share was $69.28 at December 31, 2018, compared with $69.08 at December 31, 2017 and $67.64 at September 30, 2018. 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 estimates that the ratio of Common Equity Tier 1 to risk-weighted assets under regulatory capital rules was approximately 10.13% at December 31, 2018.

In accordance with its 2018 capital plan, M&T repurchased 3,060,000 shares of its common stock during the recent quarter at an average cost per share of $163.34, for a total cost of $500 million. In the aggregate, during the 2018, M&T repurchased 12,295,817 shares of common stock at a total cost of $2.2 billion.

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 #8982419. The conference call will be webcast live through M&T's website at https://ir.mtb.com/events.cfm. A replay of the call will be available through Thursday, January 24, 2019 by calling (800) 585-8367, or (404) 537-3406 for international participants, and by making reference to ID #8982419. 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.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, 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 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.

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M&T BANK CORPORATION

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.

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M&T BANK CORPORATION

Financial Highlights

	Three months ended									Year ended
	December 31									December 31
Amounts in thousands, except per share	2018			2017			Change			2018			2017			Change
Performance
Net income	$	546,219			322,403			69	%	$	1,918,080			1,408,306			36	%
Net income available to common shareholders		525,328			302,486			74	%		1,836,035			1,327,517			38	%
Per common share:
Basic earnings	$	3.76			2.01			87	%	$	12.75			8.72			46	%
Diluted earnings		3.76			2.01			87	%		12.74			8.70			46	%
Cash dividends	$	1.00			.75			33	%	$	3.55			3.00			18	%
Common shares outstanding:
Average - diluted (1)		139,838			150,348			-7	%		144,151			152,551			-6	%
Period end (2)		138,534			150,112			-8	%		138,534			150,112			-8	%
Return on (annualized):
Average total assets		1.84	%		1.06	%					1.64	%		1.17	%
Average common shareholders' equity		14.80	%		8.03	%					12.82	%		8.87	%
Taxable-equivalent net interest income	$	1,064,918			980,457			9	%	$	4,094,199			3,815,614			7	%
Yield on average earning assets		4.51	%		3.93	%					4.33	%		3.82	%
Cost of interest-bearing liabilities		.94	%		.59	%					.78	%		.55	%
Net interest spread		3.57	%		3.34	%					3.55	%		3.27	%
Contribution of interest-free funds		.35	%		.22	%					.28	%		.20	%
Net interest margin		3.92	%		3.56	%					3.83	%		3.47	%
Net charge-offs to average total net loans (annualized)		.17	%		.12	%					.15	%		.16	%
Net operating results (3)
Net operating income	$	550,169			326,664			68	%	$	1,936,155			1,427,331			36	%
Diluted net operating earnings per common share		3.79			2.04			86	%		12.86			8.82			46	%
Return on (annualized):
Average tangible assets		1.93	%		1.12	%					1.72	%		1.23	%
Average tangible common equity		22.16	%		11.77	%					19.09	%		13.00	%
Efficiency ratio		51.70	%		54.65	%					54.79	%		55.07	%

	At December 31
Loan quality	2018			2017			Change
Nonaccrual loans	$	893,608			882,598			1	%
Real estate and other foreclosed assets		78,375			111,910			-30	%
Total nonperforming assets	$	971,983			994,508			-2	%
Accruing loans past due 90 days or more (4)	$	222,527			244,405			-9	%
Government guaranteed loans included in totals above:
Nonaccrual loans	$	34,667			35,677			-3	%
Accruing loans past due 90 days or more		192,443			235,489			-18	%
Renegotiated loans	$	245,367			221,513			11	%
Accruing loans acquired at a discount past due 90 days or more (5)	$	39,750			47,418			-16	%
Purchased impaired loans (6):
Outstanding customer balance	$	529,520			688,091			-23	%
Carrying amount		303,305			410,015			-26	%
Nonaccrual loans to total net loans		1.01	%		1.00	%
Allowance for credit losses to total loans		1.15	%		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 on page 15.

(4)	Excludes loans acquired at a discount. Predominantly residential real estate loans.

(5)	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)	Accruing loans acquired at a discount that were impaired at acquisition date and recorded at fair value.

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M&T BANK CORPORATION

Financial Highlights, Five Quarter Trend

	Three months ended
	December 31,			September 30,			June 30,			March 31,			December 31,
Amounts in thousands, except per share	2018			2018			2018			2018			2017
Performance
Net income	$	546,219			526,091			493,160			352,610			322,403
Net income available to common shareholders		525,328			505,365			472,600			332,749			302,486
Per common share:
Basic earnings	$	3.76			3.54			3.26			2.24			2.01
Diluted earnings		3.76			3.53			3.26			2.23			2.01
Cash dividends	$	1.00			1.00			.80			.75			.75
Common shares outstanding:
Average - diluted (1)		139,838			142,976			144,998			148,905			150,348
Period end (2)		138,534			141,479			144,261			146,799			150,112
Return on (annualized):
Average total assets		1.84	%		1.80	%		1.70	%		1.22	%		1.06	%
Average common shareholders' equity		14.80	%		14.08	%		13.32	%		9.15	%		8.03	%
Taxable-equivalent net interest income	$	1,064,918			1,034,771			1,014,184			980,326			980,457
Yield on average earning assets		4.51	%		4.40	%		4.28	%		4.11	%		3.93	%
Cost of interest-bearing liabilities		.94	%		.82	%		.71	%		.64	%		.59	%
Net interest spread		3.57	%		3.58	%		3.57	%		3.47	%		3.34	%
Contribution of interest-free funds		.35	%		.30	%		.26	%		.24	%		.22	%
Net interest margin		3.92	%		3.88	%		3.83	%		3.71	%		3.56	%
Net charge-offs to average total net loans (annualized)		.17	%		.07	%		.16	%		.19	%		.12	%
Net operating results (3)
Net operating income	$	550,169			530,619			497,869			357,498			326,664
Diluted net operating earnings per common share		3.79			3.56			3.29			2.26			2.04
Return on (annualized):
Average tangible assets		1.93	%		1.89	%		1.79	%		1.28	%		1.12	%
Average tangible common equity		22.16	%		21.00	%		19.91	%		13.51	%		11.77	%
Efficiency ratio		51.70	%		51.41	%		52.42	%		63.98	%		54.65	%

	December 31,			September 30,			June 30,			March 31,			December 31,
Loan quality	2018			2018			2018			2018			2017
Nonaccrual loans	$	893,608			870,832			819,984			864,671			882,598
Real estate and other foreclosed assets		78,375			87,333			98,062			101,514			111,910
Total nonperforming assets	$	971,983			958,165			918,046			966,185			994,508
Accruing loans past due 90 days or more (4)	$	222,527			254,360			223,026			235,325			244,405
Government guaranteed loans included in totals above:
Nonaccrual loans	$	34,667			33,570			34,870			36,618			35,677
Accruing loans past due 90 days or more		192,443			195,450			202,394			223,611			235,489
Renegotiated loans	$	245,367			242,892			242,528			226,829			221,513
Accruing loans acquired at a discount past due 90 days or more (5)	$	39,750			44,223			47,405			49,349			47,418
Purchased impaired loans (6):
Outstanding customer balance	$	529,520			572,979			606,683			643,124			688,091
Carrying amount		303,305			325,980			352,465			378,000			410,015
Nonaccrual loans to total net loans		1.01	%		1.00	%		.93	%		.99	%		1.00	%
Allowance for credit losses to total loans		1.15	%		1.18	%		1.16	%		1.16	%		1.16	%

(1)	Includes common stock equivalents.

(2)	Includes common stock issuable under deferred compensation plans.

(3)

(4)	Excludes loans acquired at a discount. Predominantly residential real estate loans.

(5)	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)	Accruing loans acquired at a discount that were impaired at acquisition date and recorded at fair value.

10-10-10-10-10

M&T BANK CORPORATION

Condensed Consolidated Statement of Income

	Three months ended							Year ended
	December 31							December 31
Dollars in thousands	2018		2017		Change			2018			2017		Change
Interest income	$	1,220,281		1,074,139		14	%	$	4,598,711			4,167,795		10	%
Interest expense		161,321		102,689		57			526,409			386,751		36
Net interest income		1,058,960		971,450		9			4,072,302			3,781,044		8
Provision for credit losses		38,000		31,000		23			132,000			168,000		-21
Net interest income after provision for credit losses		1,020,960		940,450		9			3,940,302			3,613,044		9
Other income
Mortgage banking revenues		92,229		96,235		-4			360,442			363,827		-1
Service charges on deposit accounts		108,791		107,783		1			429,337			427,372		—
Trust income		135,024		129,669		4			537,585			501,381		7
Brokerage services income		12,781		12,768		—			51,069			61,445		-17
Trading account and foreign exchange gains		16,582		10,468		58			32,547			35,301		-8
Gain (loss) on bank investment securities		4,219		21,296		-80			(6,301	)		21,279		-130
Other revenues from operations		110,970		105,834		5			451,321			440,538		2
Total other income		480,596		484,053		-1			1,856,000			1,851,143		—
Other expense
Salaries and employee benefits		438,928		402,394		9			1,752,264			1,648,794		6
Equipment and net occupancy		73,519		71,363		3			298,828			295,084		1
Outside data processing and software		50,206		50,033		—			199,025			184,670		8
FDIC assessments		9,837		23,722		-59			68,526			101,871		-33
Advertising and marketing		25,910		19,366		34			85,710			69,203		24
Printing, postage and supplies		8,777		8,563		2			35,658			35,960		-1
Amortization of core deposit and other intangible assets		5,359		7,025		-24			24,522			31,366		-22
Other costs of operations		189,626		213,347		-11			823,529			773,377		6
Total other expense		802,162		795,813		1			3,288,062			3,140,325		5
Income before income taxes		699,394		628,690		11			2,508,240			2,323,862		8
Applicable income taxes		153,175		306,287		-50			590,160			915,556		-36
Net income	$	546,219		322,403		69	%	$	1,918,080			1,408,306		36	%

11-11-11-11-11

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	2018		2018			2018		2018			2017
Interest income	$	1,220,281		1,167,375			1,128,905		1,082,150			1,074,139
Interest expense		161,321		138,337			120,118		106,633			102,689
Net interest income		1,058,960		1,029,038			1,008,787		975,517			971,450
Provision for credit losses		38,000		16,000			35,000		43,000			31,000
Net interest income after provision for credit losses		1,020,960		1,013,038			973,787		932,517			940,450
Other income
Mortgage banking revenues		92,229		88,408			92,499		87,306			96,235
Service charges on deposit accounts		108,791		108,647			106,784		105,115			107,783
Trust income		135,024		133,545			137,641		131,375			129,669
Brokerage services income		12,781		12,267			12,629		13,392			12,768
Trading account and foreign exchange gains		16,582		6,073			5,255		4,637			10,468
Gain (loss) on bank investment securities		4,219		(3,415	)		2,326		(9,431	)		21,296
Other revenues from operations		110,970		113,769			100,280		126,302			105,834
Total other income		480,596		459,294			457,414		458,696			484,053
Other expense
Salaries and employee benefits		438,928		431,371			418,537		463,428			402,394
Equipment and net occupancy		73,519		77,481			73,031		74,797			71,363
Outside data processing and software		50,206		50,678			49,712		48,429			50,033
FDIC assessments		9,837		18,849			19,560		20,280			23,722
Advertising and marketing		25,910		21,784			21,768		16,248			19,366
Printing, postage and supplies		8,777		8,843			8,719		9,319			8,563
Amortization of core deposit and other intangible assets		5,359		6,143			6,388		6,632			7,025
Other costs of operations		189,626		160,830			178,862		294,211			213,347
Total other expense		802,162		775,979			776,577		933,344			795,813
Income before income taxes		699,394		696,353			654,624		457,869			628,690
Applicable income taxes		153,175		170,262			161,464		105,259			306,287
Net income	$	546,219		526,091			493,160		352,610			322,403

12-12-12-12-12

M&T BANK CORPORATION

Condensed Consolidated Balance Sheet

	December 31
Dollars in thousands	2018		2017		Change
ASSETS
Cash and due from banks	$	1,605,439		1,420,888		13	%
Interest-bearing deposits at banks		8,105,197		5,078,903		60
Trading account		185,584		132,909		40
Investment securities		12,692,813		14,664,525		-13
Loans and leases:
Commercial, financial, etc.		22,977,976		21,742,651		6
Real estate - commercial		34,363,556		33,366,373		3
Real estate - consumer		17,154,446		19,613,344		-13
Consumer		13,970,499		13,266,615		5
Total loans and leases, net of unearned discount		88,466,477		87,988,983		1
Less: allowance for credit losses		1,019,444		1,017,198		—
Net loans and leases		87,447,033		86,971,785		1
Goodwill		4,593,112		4,593,112		—
Core deposit and other intangible assets		47,067		71,589		-34
Other assets		5,421,158		5,659,776		-4
Total assets	$	120,097,403		118,593,487		1	%

LIABILITIES AND SHAREHOLDERS' EQUITY
Noninterest-bearing deposits	$	32,256,668		33,975,180		-5	%
Interest-bearing deposits		57,087,998		58,278,970		-2
Deposits at Cayman Islands office		811,906		177,996		356
Total deposits		90,156,572		92,432,146		-2
Short-term borrowings		4,398,378		175,099		—
Accrued interest and other liabilities		1,637,348		1,593,993		3
Long-term borrowings		8,444,914		8,141,430		4
Total liabilities		104,637,212		102,342,668		2
Shareholders' equity:
Preferred		1,231,500		1,231,500		—
Common		14,228,691		15,019,319		-5
Total shareholders' equity		15,460,191		16,250,819		-5
Total liabilities and shareholders' equity	$	120,097,403		118,593,487		1	%

13-13-13-13-13

M&T BANK CORPORATION

Condensed Consolidated Balance Sheet, Five Quarter Trend


	December 31,		September 30,		June 30,		March 31,		December 31,
Dollars in thousands	2018		2018		2018		2018		2017
ASSETS
Cash and due from banks	$	1,605,439		1,311,611		1,367,594		1,291,664		1,420,888
Interest-bearing deposits at banks		8,105,197		6,523,746		6,669,985		6,135,434		5,078,903
Federal funds sold		—		—		1,500		1,000		—
Trading account		185,584		125,038		148,303		141,134		132,909
Investment securities		12,692,813		13,073,881		13,283,002		14,066,564		14,664,525
Loans and leases:
Commercial, financial, etc.		22,977,976		21,635,394		21,894,857		21,697,522		21,742,651
Real estate - commercial		34,363,556		33,518,375		34,137,937		33,753,506		33,366,373
Real estate - consumer		17,154,446		17,721,399		18,310,712		18,960,946		19,613,344
Consumer		13,970,499		13,805,317		13,453,944		13,298,775		13,266,615
Total loans and leases, net of unearned discount		88,466,477		86,680,485		87,797,450		87,710,749		87,988,983
Less: allowance for credit losses		1,019,444		1,019,488		1,019,248		1,019,671		1,017,198
Net loans and leases		87,447,033		85,660,997		86,778,202		86,691,078		86,971,785
Goodwill		4,593,112		4,593,112		4,593,112		4,593,112		4,593,112
Core deposit and other intangible assets		47,067		52,426		58,569		64,957		71,589
Other assets		5,421,158		5,486,826		5,525,786		5,637,881		5,659,776
Total assets	$	120,097,403		116,827,637		118,426,053		118,622,824		118,593,487

LIABILITIES AND SHAREHOLDERS' EQUITY
Noninterest-bearing deposits	$	32,256,668		31,773,560		32,086,191		31,817,516		33,975,180
Interest-bearing deposits		57,087,998		56,919,549		56,924,970		58,851,050		58,278,970
Deposits at Cayman Islands office		811,906		447,287		261,427		278,064		177,996
Total deposits		90,156,572		89,140,396		89,272,588		90,946,630		92,432,146
Short-term borrowings		4,398,378		1,310,110		3,239,416		1,626,129		175,099
Accrued interest and other liabilities		1,637,348		1,800,778		1,953,848		1,749,320		1,593,993
Long-term borrowings		8,444,914		9,140,268		8,382,316		8,591,051		8,141,430
Total liabilities		104,637,212		101,391,552		102,848,168		102,913,130		102,342,668
Shareholders' equity:
Preferred		1,231,500		1,231,500		1,231,500		1,231,500		1,231,500
Common		14,228,691		14,204,585		14,346,385		14,478,194		15,019,319
Total shareholders' equity		15,460,191		15,436,085		15,577,885		15,709,694		16,250,819
Total liabilities and shareholders' equity	$	120,097,403		116,827,637		118,426,053		118,622,824		118,593,487

14-14-14-14-14

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, 2018 from						December 31,										Change
Dollars in millions	2018					2017					2018					December 31,			September 30,			2018					2017					in
	Balance		Rate			Balance		Rate			Balance		Rate			2017			2018			Balance		Rate			Balance		Rate			balance
ASSETS
Interest-bearing deposits at banks	$	7,394		2.23	%		6,680		1.31	%		5,207		1.98	%		11	%		42	%	$	5,614		1.93	%		5,578		1.10	%		1	%
Federal funds sold		—		—			—		—			—		—			—			—			1		1.95			—		—			—
Trading account		56		2.65			87		1.31			65		1.78			-35			-14			58		2.55			71		1.70			-18
Investment securities		13,034		2.41			14,808		2.30			13,431		2.37			-12			-3			13,694		2.37			15,538		2.34			-12
Loans and leases, net of unearned discount
Commercial, financial, etc.		22,376		4.92			21,562		4.06			21,689		4.68			4			3			21,832		4.60			21,981		3.88			-1
Real estate - commercial		33,586		5.27			33,138		4.61			33,800		5.10			1			-1			33,682		5.01			33,196		4.40			1
Real estate - consumer		17,421		4.31			19,974		4.03			18,006		4.21			-13			-3			18,330		4.18			21,013		3.96			-13
Consumer		13,918		5.35			13,163		4.91			13,637		5.26			6			2			13,555		5.19			12,625		4.82			7
Total loans and leases, net		87,301		5.02			87,837		4.40			87,132		4.86			-1			—			87,399		4.79			88,815		4.25			-2
Total earning assets		107,785		4.51			109,412		3.93			105,835		4.40			-1			2			106,766		4.33			110,002		3.82			-3
Goodwill		4,593					4,593					4,593					—			—			4,593					4,593					—
Core deposit and other intangible assets		50					75					55					-34			-11			59					86					-32
Other assets		5,371					6,146					5,514					-13			-3			5,541					6,179					-10
Total assets	$	117,799					120,226					115,997					-2	%		2	%	$	116,959					120,860					-3	%

LIABILITIES AND SHAREHOLDERS' EQUITY
Interest-bearing deposits
Savings and interest-checking deposits	$	51,820		.54			53,436		.29			51,552		.43			-3	%		1	%	$	52,102		.41			53,399		.25			-2	%
Time deposits		5,960		1.07			6,888		.70			5,826		.88			-13			2			6,025		.85			8,161		.75			-26
Deposits at Cayman Islands office		693		1.81			215		.61			407		1.52			223			70			394		1.43			185		.64			114
Total interest-bearing deposits		58,473		.61			60,539		.34			57,785		.49			-3			1			58,521		.47			61,745		.32			-5
Short-term borrowings		315		1.91			178		.81			374		1.70			77			-16			331		1.63			205		.74			62
Long-term borrowings		9,239		3.03			8,464		2.37			9,047		2.90			9			2			8,845		2.81			8,302		2.28			7
Total interest-bearing liabilities		68,027		.94			69,181		.59			67,206		.82			-2			1			67,697		.78			70,252		.55			-4
Noninterest-bearing deposits		32,631					32,930					31,467					-1			4			31,893					32,520					-2
Other liabilities		1,752					1,844					1,775					-5			-1			1,739					1,793					-3
Total liabilities		102,410					103,955					100,448					-1			2			101,329					104,565					-3
Shareholders' equity		15,389					16,271					15,549					-5			-1			15,630					16,295					-4
Total liabilities and shareholders' equity	$	117,799					120,226					115,997					-2	%		2	%	$	116,959					120,860					-3	%

Net interest spread				3.57					3.34					3.58											3.55					3.27
Contribution of interest-free funds				.35					.22					.30											.28					.20
Net interest margin				3.92	%				3.56	%				3.88	%										3.83	%				3.47	%

15-15-15-15-15

M&T BANK CORPORATION

Reconciliation of GAAP to Non-GAAP Measures

	Three months ended						Year ended
	December 31						December 31
	2018			2017			2018			2017
Income statement data
In thousands, except per share
Net income
Net income	$	546,219			322,403			1,918,080			1,408,306
Amortization of core deposit and other intangible assets (1)		3,950			4,261			18,075			19,025
Net operating income	$	550,169			326,664			1,936,155			1,427,331

Earnings per common share
Diluted earnings per common share	$	3.76			2.01			12.74			8.70
Amortization of core deposit and other intangible assets (1)		.03			.03			.12			.12
Diluted net operating earnings per common share	$	3.79			2.04			12.86			8.82

Other expense
Other expense	$	802,162			795,813			3,288,062			3,140,325
Amortization of core deposit and other intangible assets		(5,359	)		(7,025	)		(24,522	)		(31,366	)
Noninterest operating expense	$	796,803			788,788			3,263,540			3,108,959
Efficiency ratio
Noninterest operating expense (numerator)	$	796,803			788,788			3,263,540			3,108,959
Taxable-equivalent net interest income		1,064,918			980,457			4,094,199			3,815,614
Other income		480,596			484,053			1,856,000			1,851,143
Less: Gain (loss) on bank investment securities		4,219			21,296			(6,301	)		21,279
Denominator	$	1,541,295			1,443,214			5,956,500			5,645,478
Efficiency ratio		51.70	%		54.65	%		54.79	%		55.07	%
Balance sheet data
In millions
Average assets
Average assets	$	117,799			120,226			116,959			120,860
Goodwill		(4,593	)		(4,593	)		(4,593	)		(4,593	)
Core deposit and other intangible assets		(50	)		(75	)		(59	)		(86	)
Deferred taxes		13			26			16			33
Average tangible assets	$	113,169			115,584			112,323			116,214
Average common equity
Average total equity	$	15,389			16,271			15,630			16,295
Preferred stock		(1,232	)		(1,232	)		(1,232	)		(1,232	)
Average common equity		14,157			15,039			14,398			15,063
Goodwill		(4,593	)		(4,593	)		(4,593	)		(4,593	)
Core deposit and other intangible assets		(50	)		(75	)		(59	)		(86	)
Deferred taxes		13			26			16			33
Average tangible common equity	$	9,527			10,397			9,762			10,417
At end of quarter
Total assets
Total assets	$	120,097			118,593
Goodwill		(4,593	)		(4,593	)
Core deposit and other intangible assets		(47	)		(72	)
Deferred taxes		13			19
Total tangible assets	$	115,470			113,947
Total common equity
Total equity	$	15,460			16,251
Preferred stock		(1,232	)		(1,232	)
Undeclared dividends - cumulative preferred stock		(3	)		(3	)
Common equity, net of undeclared cumulative preferred dividends		14,225			15,016
Goodwill		(4,593	)		(4,593	)
Core deposit and other intangible assets		(47	)		(72	)
Deferred taxes		13			19
Total tangible common equity	$	9,598			10,370

(1)	After any related tax effect.

16-16-16-16-16

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,
	2018			2018			2018			2018			2017
Income statement data
In thousands, except per share
Net income
Net income	$	546,219			526,091			493,160			352,610			322,403
Amortization of core deposit and other intangible assets (1)		3,950			4,528			4,709			4,888			4,261
Net operating income	$	550,169			530,619			497,869			357,498			326,664

Earnings per common share
Diluted earnings per common share	$	3.76			3.53			3.26			2.23			2.01
Amortization of core deposit and other intangible assets (1)		.03			.03			.03			.03			.03
Diluted net operating earnings per common share	$	3.79			3.56			3.29			2.26			2.04

Other expense
Other expense	$	802,162			775,979			776,577			933,344			795,813
Amortization of core deposit and other intangible assets		(5,359	)		(6,143	)		(6,388	)		(6,632	)		(7,025	)
Noninterest operating expense	$	796,803			769,836			770,189			926,712			788,788
Efficiency ratio
Noninterest operating expense (numerator)	$	796,803			769,836			770,189			926,712			788,788
Taxable-equivalent net interest income		1,064,918			1,034,771			1,014,184			980,326			980,457
Other income		480,596			459,294			457,414			458,696			484,053
Less: Gain (loss) on bank investment securities		4,219			(3,415	)		2,326			(9,431	)		21,296
Denominator	$	1,541,295			1,497,480			1,469,272			1,448,453			1,443,214
Efficiency ratio		51.70	%		51.41	%		52.42	%		63.98	%		54.65	%
Balance sheet data
In millions
Average assets
Average assets	$	117,799			115,997			116,413			117,684			120,226
Goodwill		(4,593	)		(4,593	)		(4,593	)		(4,593	)		(4,593	)
Core deposit and other intangible assets		(50	)		(55	)		(62	)		(68	)		(75	)
Deferred taxes		13			14			17			18			26
Average tangible assets	$	113,169			111,363			111,775			113,041			115,584
Average common equity
Average total equity	$	15,389			15,549			15,533			16,059			16,271
Preferred stock		(1,232	)		(1,232	)		(1,232	)		(1,232	)		(1,232	)
Average common equity		14,157			14,317			14,301			14,827			15,039
Goodwill		(4,593	)		(4,593	)		(4,593	)		(4,593	)		(4,593	)
Core deposit and other intangible assets		(50	)		(55	)		(62	)		(68	)		(75	)
Deferred taxes		13			14			17			18			26
Average tangible common equity	$	9,527			9,683			9,663			10,184			10,397
At end of quarter
Total assets
Total assets	$	120,097			116,828			118,426			118,623			118,593
Goodwill		(4,593	)		(4,593	)		(4,593	)		(4,593	)		(4,593	)
Core deposit and other intangible assets		(47	)		(52	)		(59	)		(65	)		(72	)
Deferred taxes		13			14			16			17			19
Total tangible assets	$	115,470			112,197			113,790			113,982			113,947
Total common equity
Total equity	$	15,460			15,436			15,578			15,710			16,251
Preferred stock		(1,232	)		(1,232	)		(1,232	)		(1,232	)		(1,232	)
Undeclared dividends - cumulative preferred stock		(3	)		(3	)		(3	)		(3	)		(3	)
Common equity, net of undeclared cumulative preferred dividends		14,225			14,201			14,343			14,475			15,016
Goodwill		(4,593	)		(4,593	)		(4,593	)		(4,593	)		(4,593	)
Core deposit and other intangible assets		(47	)		(52	)		(59	)		(65	)		(72	)
Deferred taxes		13			14			16			17			19
Total tangible common equity	$	9,598			9,570			9,707			9,834			10,370

(1)	After any related tax effect.