M&T profit slips in 4th quarter

A combination of one-time items helped push profit down at M&T Bank Corp. (NYSE: MTB) in the fourth quarter, but full-year earnings for 2011 rose more than 16 percent.

Buffalo–based M&T earned $148 million, or $1.04 per share, in the fourth quarter, down from $204 million, or 

$1.59 per share, a year earlier. For the full year, the banking company earned 

$859 million, or $6.35 per share, up from $736 million, or $5.69 per share, in 2010.

For the quarter, M&T recorded a charge of $79 million related to its 20 percent stake in Bayview Lending Group, LLC of Miami.

The small-balance, commercial real-estate securitization market that Bayview previously operated in is stagnant, according to M&T, but the company’s asset-management operations continue to grow.

Its business of managing capital in the distressed real-estate market is also performing well, the bank said. Still, M&T leaders have increased their estimate of the amount of time it will take to recoup the bank’s investment.

M&T paid $300 million for its minority stake in Bayview in February 2007. The investment has been written down to its estimated fair value of $115 million.

In addition to the Bayview charge, M&T took a $25 million charge related to certain mortgage-backed investment securities. The bank also received $55 million in cash related to a lawsuit settlement during the quarter and made a $30 million contribution to the M&T Charitable Foundation.

Combined, those four items cut profit by $48 million, or 38 cents a share, in the fourth quarter, M&T said.

M&T Bank, has $77.9 billion in assets and 780 branch offices in New York, Pennsylvania, Maryland, Virginia, West Virginia, New Jersey, Delaware, Florida, Washington, D.C., and Ontario, Canada.

M&T is the leading bank in the Syracuse–area deposit market with 30 branch offices, more than $2.2 billion in deposits, and a market share of more than 21.2 percent. It is number two in the Utica–Rome market with 13 branches, more than $615 million in deposits, and a market share of about 16.8 percent.

M&T also leads the Binghamton–area market with a deposit market share of 48.7 percent, 16 branches, and more than $1.2 billion in deposits, according to statistics as of June 30 from the Federal Deposit Insurance Corp.

The bank remains cautious in its outlook for loan growth, M&T Executive Vice President and CFO Rene Jones said during a Jan. 17 conference call on the fourth-quarter results.

“The economy is growing, albeit slowly, but unemployment still remains high and the housing sector is unsettled,” he said.

Loans and leases totaled $60.1 billion at the end of 2011, up from about $52 billion at the end of 2010. Deposits totaled

 $59.4 billion at the end of the year, up from $49.8 billion the year before.

The provision for loan losses was $74 million in the fourth quarter, down from $85 million a year earlier. Net charge- offs totaled $74 million for the period, down from $77 million a year earlier.

Nonaccruing loans at the end of the year totaled $1.1 billion, down from $1.14 billion a year earlier.

Fourth-quarter net interest income at M&T was $625 million, up from $580 million in the same quarter of 2010. Noninterest income for the period totaled $398 million, up from $287 million a year earlier.

Noninterest expenses in the fourth quarter totaled $740 million, up from $469 million in the fourth quarter of 2010.