M&t Bank Corporation · NYSE:MTB
M&t Bank — Q2 2024 Earnings Presentation
27 slides from M&t Bank's earnings presentation, Jul 18, 2024
Slide 1: Earnings Results 2nd Quarter 2024
Earnings Results 2nd Quarter 2024 July 18, 2024
Slide 2: Disclaimer
Disclaimer This presentation may contain forward-looking statements regarding M&T Bank Corporation (“M&T”) within the meaning of continued availability of financing; financial resources in the amounts, at the times and on the terms required to support M&T the Private Securities Litigation Reform Act
Slide 3: Purpose, Mission and Operating Principles
Purpose Mission To make a difference We are a bank for communities – in people’s lives. committed to improving the lives of our customers and all the communities we touch. Operating Principles Local Scale Credit Discipline Operating & Capital Efficiency 3 3
Slide 4: Making a positive impact on our communities, customers, and colleagues
Making a positive impact on our communities, customers, and colleagues Sustainability Accomplishments and Highlights Fostering Prosperity in Our Communities Investing in Our Employees • Ranked #6 SBA Lender in the country (FY2023), the 15th consecutive year among the nation’s top 10 SBA • 412 people
Slide 5: Key Awards and Accolades
Key Awards and Accolades #1 in Customer Satisfaction with Mobile Banking Apps among Regional Banks J.D. Power 2024 U.S. Banking Mobile App Satisfaction Study; among banks with $70B to $200B in deposits. Visit jdpower.com/awards for more details. 5
Slide 6: Financial Results
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Slide 7: Second Quarter 2024 Earnings Highlights
Second Quarter 2024 Earnings Highlights GAAP Notable items ($ in millions, except per share) 2Q24 1Q24 2Q23 ($ in millions, except per share) 2Q24 1Q24 2Q23 Revenues $2,302 $2,260 $2,602 Amt(1) EPS Amt(1) EPS Amt(1) EPS Noninterest Expense $1,297 $1,396 $1,293 Gain on sale of Collective $— $— $— $—
Slide 8: Second Quarter 2024 Earnings Highlights
Second Quarter 2024 Earnings Highlights Net Operating Results (Non-GAAP)(1) ($ in millions, except per share) 2Q24 1Q24 2Q23 Net Operating Income $665 $543 $879 Diluted Net Operating EPS $3.79 $3.09 $5.12 Efficiency Ratio 55.3% 60.8% 48.9% Net Operating ROTA 1.31% 1.08% 1.80% Net Operating ROTCE 15.
Slide 9: Net Interest Income & Net Interest Margin
Net Interest Income & Net Interest Margin QoQ Drivers $1,813 $1,790 • Taxable-equivalent net interest income(1) $1,735 $1,692 $1,731 increased +$39 million or +2% QoQ – Favorable impact from loan growth and asset repricing, particularly in the investment securities portfolio – Higher nonaccrual inte
Slide 10: Balance Sheet – Overview
Balance Sheet – Overview Change 2Q24 vs Average Balances, $ in billions, except per share 2Q24 1Q24 2Q23 1Q24 2Q23 Interest-bearing Deposits at Banks $29.3 $30.7 $23.6 -4% 24% Investment Securities $29.7 $28.6 $28.6 4% 4% Commercial and Industrial (“C&I”) $58.1 $56.8 $54.5 2% 7% Commercial Real Esta
Slide 11: Balance Sheet – Average Loans
Balance Sheet – Average Loans QoQ Drivers $133.5 $132.6 $132.8 $133.8 $134.6 Average loans +$792 million or +1% QoQ: $20.3 $20.2 $20.6 $21.2 $22.0 • C&I loans increased +2% (+$1.3 billion), driven by continued growth spanning most industry types $23.8 $23.6 $23.3 $23.1 $23.0 • CRE loans declined -4%
Slide 12: Balance Sheet – Securities and Cash
Balance Sheet – Securities and Cash Average Investment Securities and Yield Securities and Cash - at 6/30/24 Other Interest- Securities $29.7 bearing 2% $28.6 $28.6 deposits $28.0 $27.5 at banks HTM 44% Securities 26% $ IN BILLIONS Yield up +31 bps $56.5B 3.61% TOTAL 3.30% 3.09% 3.14% 3.13% Cash 3%
Slide 13: Balance Sheet – Average Deposits
Balance Sheet – Average Deposits $164.7 $164.1 QoQ Drivers $162.7 $163.5 $159.4 $16.0 $19.5 $21.2 $20.6 $19.8 Average deposits decreased -$574 million or less than -0.5% QoQ: • Mix shift to lower cost savings and interest-checking deposits $ IN BILLIONS $87.2 $89.3 $93.4 $94.9 $96.0 • Cost of intere
Slide 14: Income Statement – Noninterest Income
Income Statement – Noninterest Income Gain on Change 2Q24 vs CIT Sale(1) $ in millions 2Q24 1Q24 2Q23 1Q24 2Q23 $803 Mortgage Banking Revenues $106 $104 $107 1% -1% $225 Service Charges on Deposits $127 $124 $119 3% 8% $578 $580 $584 $ IN MILLIONS $560 Trust Income $170 $160 $172 6% -1% $578 $560 $5
Slide 15: Income Statement – Noninterest Expenses
Income Statement – Noninterest Expenses FDIC special assessment(3) Change 2Q24 vs $1,450 $1,396 $ in millions 2Q24 1Q24 2Q23 1Q24 2Q23 $1,293 $1,278 $1,297 $1,435 (4) $1,381 Salaries & Benefits $764 $833 $738 -8% 4% $1,278 $1,263 $1,284 Equip & Occupancy $125 $129 $129 -3% -3% $ IN MILLIONS Outside
Slide 16: Credit
Credit Net Charge-offs Provision for Credit Losses $ IN MILLIONS $148 $ IN MILLIONS $138 $137 $127 $225 $200 $96 0.44% 0.42% 0.41% 0.38% $150 $150 $150 0.29% 2Q23 3Q23 4Q23 1Q24 2Q24 Net Charge-offs ($) Net Charge-off Ratio (%) 2Q23 3Q23 4Q23 1Q24 2Q24 Nonaccrual Loans Allowance for Credit Losses $2
Slide 17: Criticized C&I and CRE Loans
Criticized C&I and CRE Loans -$889 million QoQ criticized loans decreased: $12.6 $12.9 • C&I increased +$98 million $12.1 – Driven by health services and motor vehicle and recreational $11.1 finance dealers $10.5 • CRE decreased -$987 million – Permanent CRE -$773 million $ IN BILLIONS – Constructio
Slide 18: Criticized C&I Loans
Criticized C&I Loans June 30, 2024 March 31, 2024 Criticized Criticized Total Criticized Criticized Total (Dollars in millions) Outstanding Accrual Nonaccrual Criticized Outstanding Accrual Nonaccrual Criticized Commercial and industrial excluding owner-occupied real estate by industry: Financial an
Slide 19: Criticized CRE Loans
Criticized CRE Loans June 30, 2024 March 31, 2024 Criticized Criticized Total Criticized Criticized Total (Dollars in millions) Outstanding Accrual Nonaccrual Criticized Outstanding Accrual Nonaccrual Criticized Permanent finance by property type: Apartments/Multifamily $5,824 $882 $108 $990 $6,441
Slide 20: Capital
Capital CET1(1) TBVPS (2) 11.44% $102.42 $98.54 $99.54 11.08% 10.95% 10.98% $93.99 $91.58 10.59% 2Q23 3Q23 4Q23 1Q24 2Q24 2Q23 3Q23 4Q23 1Q24 2Q24 QoQ Drivers • CET1 capital ratio increased +36 bps to 11.44%(1) at 2Q24 • Tangible common equity to tangible assets increased +52 bps to 8.55% at the end
Slide 21: 2024 Outlook
2024 Outlook 2024 Outlook Comments Net Interest Income $6.85 billion to • NIM in the 3.50s Taxable-equivalent $6.90 billion • Reflects two rate cuts Income Statement $2.3 billion to Fee Income • Growth in trust income from strong market activity $2.4 billion GAAP Expense $5.25 billion to Includes in
Slide 22: Why invest in M&T?
Why invest in M&T? Purpose-Driven Successful and Sustainable Business Model that Produces Strong Shareholder Returns Purpose Driven Successful and Strong Shareholder Organization Sustainable Returns Business Model • Long term focused with deeply • Experienced and seasoned • 15-20% ROATCE embedded cu
Slide 23: Appendix
Appendix M&&Bank Corporation| 23
Slide 24: GAAP to Net Operating (Non-GAAP) Reconciliation
Appendix GAAP to Net Operating (Non-GAAP) Reconciliation In millions, except per share 2Q23 3Q23 4Q23 1Q24 2Q24 Net income Net income $867 $690 $482 $531 $655 Amortization of core deposits and other intangible assets (1) 12 12 12 12 10 Net operating income $879 $702 $494 $543 $665 Earnings per commo
Slide 25: GAAP to Net Operating (Non-GAAP) Reconciliation
Appendix GAAP to Net Operating (Non-GAAP) Reconciliation In millions 2Q23 3Q23 4Q23 1Q24 2Q24 Other expense Other expense $1,293 $1,278 $1,450 $1,396 $1,297 Amortization of core deposit and other intangible assets (15) (15) (15) (15) (13) Noninterest operating expense $1,278 $1,263 $1,435 $1,381 $1,
Slide 26: GAAP to Tangible (Non-GAAP) Reconciliation
Appendix GAAP to Tangible (Non-GAAP) Reconciliation In millions 2Q23 3Q23 4Q23 1Q24 2Q24 Average assets Average assets $204,376 $205,791 $208,752 $211,478 $211,981 Goodwill (8,473) (8,465) (8,465) (8,465) (8,465) Core deposit and other intangible assets (185) (170) (154) (140) (126) Deferred taxes 4
Slide 27: GAAP to Tangible (Non-GAAP) Reconciliation
Appendix GAAP to Tangible (Non-GAAP) Reconciliation In millions 6/30/2023 9/30/2023 12/31/2023 3/31/2024 6/30/2024 Total assets Total assets $207,672 $209,124 $208,264 $215,137 $208,855 Goodwill (8,465) (8,465) (8,465) (8,465) (8,465) Core deposit and other intangible assets (177) (162) (147) (132)