M&t Bank Corporation · NYSE:MTB
M&t Bank — Investor Presentation (December 2023)
38 slides from M&t Bank's investor presentation, Dec 5, 2023
Slide 1: Investor Update 4th Quarter 2023
Investor Update 4th Quarter 2023 December 2023 Exhibit 99.1
Slide 2: Disclaimer
Disclaimer This presentation may contain forward-looking statements regarding M&T Bank Corporation (“M&T”) within the meaning of the Private Securities Litigation Reform Act of 1995 and the rules and regulations of the Securities and Exchange Commission (“SEC”). Any statement that does not describe
Slide 3: Purpose, Mission and Operating Principles
Purpose To make a difference in people’s lives. Mission We are a bank for communities – committed to improving the lives of our customers and all the communities we touch. Operating Principles Local Scale Credit Discipline Operating & Capital Efficiency
Slide 4: Driven by our talent
Driven by our talent 18-year average tenure for executive management Talent development programs span 4 decades Only 3 CEOs, 5 CFOs, and 2 CCOs in 39 years More than 40% of our Board of Directors team is diverse Several employee development programs and initiatives for attracting and promoting diver
Slide 5: Delivering impact to our communities and customers
Delivering impact to our communities and customers Customer Focused Community Engagement Business Support Top Rankings When our customers and communities succeed, we all succeed Note: All data points except for SBA rankings are for 2022. Long lasting relationships Designated 119 multicultural bankin
Slide 6: Our ESG commitment
Our ESG commitment $231.6 million invested in the renewable energy sector 13% reduced electricity consumption since 2019(1) 46% reduced Scope 1 emissions since 2019(1) 14% reduced Scope 2 emissions since 2019(1) 1,440 Small Business Administration loans originated in 2022, totaling $203.8 million 2,
Slide 7: Local Scale in Key Markets
Local Scale in Key Markets Source: S&P Global Market Intelligence, FDIC Summary of Deposits (1) Top banks and thrifts by number of branches in Northeast / Mid-Atlantic regions (CT, DC, DE, MA, MD, ME, NH, NJ, NY, PA, RI, VA, VT, WV). M&T as of 11/14/2023, excludes two domestic branches outside of No
Slide 8: Superior Pre-Credit Earnings
2018 2019 2020 2021 2022 3Q22 2Q23 3Q23 Superior Pre-Credit Earnings Net Interest Margin 3.83% 3.84% 3.16% 2.76% 3.39% 3.68% 3.91% 3.79% Efficiency Ratio (1) 54.8% 55.7% 56.3% 59.0% 56.6% 53.6% 48.9% 53.7% Efficiency Ratio - Adjusted (1) 54.8% 54.9% 56.3% 59.0% 55.9% 53.6% 53.4% 53.7% PPNR (1) $2,64
Slide 9: Solid Performance in Key Metrics against Peers
Solid Performance in Key Metrics against Peers ROTCE % (ex-AOCI)(1) 3Q23 Net Interest Margin 3Q23 Efficiency Ratio(1) 3Q23 PPNR / RWA(1) 3Q23 NCO / Loans 3Q23 Note: (1) See Appendix 1 and 2 for reconciliation of GAAP with these non-GAAP measures. Source: S&P Global Market Intelligence and company fi
Slide 10: Areas of Focus
Areas of M&& Bank Corporation | 10
Slide 11: Balance Sheet & 4Q23 Trends and Outlook
Balance Sheet & 4Q23 Trends 4Q23 November QTD Comments Average Balance Int-Bearing Dep. At Banks (Cash) $30.4 Billion Securities $27.6 Billion Loans $132.5 Billion C&I and Consumer loan growth, continued decline in CRE, modest decline in Residential Mortgage Deposits $164.6 Billion Primarily growth
Slide 12: Decreasing Asset Sensitivity
Decreasing Asset Sensitivity Represents estimated impact on NII resulting from a parallel shift in interest rates during first modeling year Sensitivity of NII to Changes in Interest Rates1 $, Millions Increased mix of fixed liquid assets Y/Y Avg. interest-bearing deposits at banks down $4B to $27B
Slide 13: Granular, Diversified Core Deposit Funding & Strong Liquidity Position
Granular, Diversified Core Deposit Funding & Strong Liquidity Position Granular Deposit Base Diversified Deposit Base Stable & Long-Tenured Relationships Strong Liquidity Profile 65% of deposits are insured or collateralized as of 9/30/2023 Average consumer deposit account balance is $12,000 Average
Slide 14: Local Scale Leads to Superior Deposit Franchise
Sources: S&P Global Market Intelligence and FDIC Local Scale Leads to Superior Deposit Franchise Noninterest-bearing deposits represented 33% of 3Q 2023 average total deposits for M&T or 36% of total deposits excluding brokered, compared to 27% peer median 2003-3Q23 Average M&T 0.70% Peer Median 0.8
Slide 15: Diversified and Granular Deposit Base
Diversified and Granular Deposit Base Total commercial and business banking diversified geographically across Upstate NY (24%), Mid-Atlantic (10%), New England (12%), NYC area (16%), Greater Baltimore area (11%), Connecticut (8%), and other regions Commercial $43B in deposits diversified across indu
Slide 16: Strong Core Funding and Liquidity
Liquidity Sources represent ~133% of Adjusted Uninsured Deposits Uninsured Deposits represent 42% of Total Deposits, 35% excluding Collateralized Deposits Average Cash Balances represent over 14% of Earning Assets Issued $1 billion in senior notes in 4Q23 Strong Core Funding and Liquidity Liquidity
Slide 17: Strong CRE Underwriting Track Record
Strong CRE Underwriting Track Record All information presented as of 9/30/23. Long History & Expertise in CRE Lending Long-term relationships and consistently conservative Credit Standards through economic cycles Two Chief Credit Officers over the past 40 years Diversified Loan Portfolio The mix of
Slide 18: Well Diversified Loan Portfolio
-6% Permanent IRE $25.9B, 20% Well Diversified Loan Portfolio Loan Portfolio Composition 9/30/2023 Investor-Owned Real Estate % of Total Loans IRE Concentration has declined 6% since 2019 $132B Construction Permanent
Slide 19: Allowance for Credit Losses assumptions
September 30, 2023 assumptions Average unemployment rate of 4.6% Gross domestic product growth at a 0.7% rate during the first year of the forecast period and at a 2.0% rate in the second year Commercial real estate and residential real estate prices were assumed to cumulatively contract 8.5% and 4.
Slide 20: Superior Credit Losses Through Multiple Economic Cycles
Source: S&P Global Market Intelligence and FRY9C. Note: Industry data represents all FDIC-insured institutions from the FDIC’s Quarterly Banking Profile (“QBP”). Average, max, and range are weighted FY1990-3Q23. Superior Credit Losses Through Multiple Economic Cycles M&T Credit Philosophy NCO % of L
Slide 21: Best-In-Class Credit NCO Ratios Across All Portfolios
Source: S&P Global Market Intelligence and FRY9C. Note: Range measures the difference between the period maximum and minimum for M&T and peers. Average, max, and range are FY2005-3Q23 Best-In-Class Credit NCO Ratios Across All Portfolios C&I Construction CRE, excluding Construction HELOC Residential
Slide 22: Spotlight on Permanent IRE
Spotlight on Permanent IRE Hallmark of structures requires material upfront ‘skin in the game’ to ensure alignment and provide a buffer against potential future losses Weighted average LTV is 56%; over 80% of the total Permanent IRE portfolio has an LTV of 70% or less Approximately 70% of the Perman
Slide 23: Diversified and Low LTV Permanent Office CRE
Diversified and Low LTV Permanent Office CRE (1) Lease maturity data for loans with >$10MM in exposure Balance ($, B) % of Total Loans WAVG LTV New York City $0.7B 0.5% 51% Connecticut $0.5B 0.4% 58% Greater Boston $0.5B 0.3% 60% New Jersey $0.3B 0.2% 58% Western New York $0.3B 0.2% 65% VT/NH/ME $0.
Slide 24: Permanent Office CRE Maturities Spread Out and Manageable
Permanent Office CRE Maturities Spread Out and Manageable 4Q23 1Q24 2Q24 3Q24 4Q23-3Q24 4Q24-3Q25 >90% 9% 0% 0% 1% 4% 13% >80%-90% 5% 25% 0% 22% 14% 0% >70%-80% 0% 9% 22% 17% 9% 4% >60%-70% 26% 23% 20% 19% 23% 21% >50%-60% 36% 10% 43% 11% 24% 30% ≤50% 24% 33% 14% 30% 27% 32% Maturities ($, B) $0.2 $
Slide 25: Commercial Criticized & Nonaccrual Details
Commercial Criticized & Nonaccrual Details Borrower selection is key to low loss content; approximately 90% of criticized and 56% of nonaccrual loans are paid current. History of working with borrowers to reduce loss; minimal loan/note sales over past 20 years. In most cases, for loans maturing in t
Slide 26: Strong Capital and Low AOCI Impact
Strong Capital and Low AOCI Impact Top quartile CET1 ratio among peers (10.95%) Top quartile TCE ratio among peers (7.8%); more than ~290 bps above peer median Agency MBS/CMBS account for 54% of total and U.S. Treasurys 32% AFS duration ~1.5 years and HTM duration ~5.7 years, total debt securities d
Slide 27: Diversified Securities Portfolio
Diversified Securities Portfolio (1) Mortgage securities include estimated prepayment under market forward interest rates. $27.3B Securities Portfolio Composition 9/30/2023 Securities of $27.3B; 13% of total assets ~$6.9B securities maturing1 in 2024 with an average yield of 2.2%. ~$4.8B securities
Slide 28: Strong Capital Levels Compared to Peers
Strong Capital Levels Compared to Peers Capital levels favorable to peers both as reported and when considering AOCI Strong capital position benefits M&T under current and proposed rules CET1 ratio would exceed SCB minimum levels under proposal Modest impact from including AOCI in regulatory capital
Slide 29: Why invest in M&T?
Why invest in M&T? Long term focused with deeply embedded culture Business operated to represent the best interests of all key stakeholders Energized colleagues consistently serving our customers and communities A safe haven for our clients as proven during turbulent times and crisis Experienced and
Slide 30: Appendices
Appendices M&f& Bank Corporation | 30
Slide 31: GAAP to GAAP - Adjusted (Non-GAAP) Reconciliation
Appendix 1 Note: M&T is providing supplemental reporting of its results on a “GAAP – Adjusted” basis, from which M&T excludes the after-tax effect of certain notable items of significance. Although “GAAP – Adjusted” income as presented by M&T is not a GAAP measure, M&T management believes that this
Slide 32: GAAP to Net Operating and Net Operating-Adjusted Reconciliation
Appendix 2 Note: 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 and other intangible asset balan
Slide 33: GAAP to Net Operating (Non-GAAP) Reconciliation
Appendix 2 GAAP to Net Operating (Non-GAAP) Reconciliation In millions 2018 2019 2020 2021 2022 3Q22 2Q23 3Q23 Efficiency ratio Noninterest expense $3,288 $3,469 $3,385 $3,612 $5,050 $1,279 $1,293 $1,278 Less: Amortization of core deposit and other intangible assets 25 19 15 10 56 18 15 15 Less: Mer
Slide 34: GAAP to Net Operating - Adjusted (Non-GAAP) Reconciliation
Appendix 2 GAAP to Net Operating - Adjusted (Non-GAAP) Reconciliation In millions 2018 2019 2020 2021 2022 3Q22 2Q23 3Q23 Efficiency ratio - Adjusted Noninterest expense $3,288 $3,469 $3,385 $3,612 $5,050 $1,279 $1,293 $1,278 Less: Amortization of core deposit and other intangible assets 25 19 15 10
Slide 35: GAAP to Tangible (Non-GAAP) Reconciliation
Appendix 2 GAAP to Tangible (Non-GAAP) Reconciliation In millions 2018 2019 2020 2021 2022 3Q22 2Q23 3Q23 Average assets Average assets $116,959 $119,584 $135,480 $152,669 $190,252 $201,131 $204,376 $205,791 Goodwill (4,593) (4,593) (4,593) (4,593) (7,537) (8,501) (8,473) (8,465) Core deposit and ot
Slide 36: GAAP to Tangible (Non-GAAP) Reconciliation
Appendix 2 GAAP to Tangible (Non-GAAP) Reconciliation In millions 12/31/2018 12/31/2019 12/31/2020 12/31/2021 12/31/2022 9/30/2022 6/30/2023 9/30/2023 Total assets Total assets $120,097 $119,873 $142,601 $155,107 $200,730 $197,955 $207,672 $209,124 Goodwill (4,593) (4,593) (4,593) (4,593) (8,490) (8
Slide 37: GAAP to Tangible (Non-GAAP) Reconciliation
Appendix 2 GAAP to Tangible (Non-GAAP) Reconciliation In millions 3Q23 Average common equity ex AOCI Average total equity $26,020 Preferred stock (2,011) Average common equity $24,009 Goodwill (8,465) Core deposit and other intangible assets (170) Deferred taxes 43 Average tangible common equity $15
Slide 38: M&T Peer Group
M&T Peer Group PNC Financial Services Group, Inc. Comerica Incorporated Regions Financial Corporation Fifth Third Bancorp Huntington Bancshares Incorporated Zions Bancorporation, NA KeyCorp Truist Financial Corporation U.S. Bancorp M&T Bank Corporation Citizens Financial Group, Inc. First Horizon Na