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M&T had delayed plans to buy Hudson City Bancorp because of the Federal Reserve's compliance concerns, and an order made public Tuesday details what the Buffalo, N.Y., company has to fix.
June 18 -
CFO Rene Jones says the two companies will "do whatever we need to do" to complete the merger, which has been delayed by the Federal Reserve Board's concerns with M&T's anti-money-laundering policies.
April 15
Investment gains helped M&T Bank Corp. (MTB) in Buffalo, N.Y., record a profit increase.
The $83.2 billion-asset company posted a profit of $348 million for the second quarter, 49% higher than in the second quarter of 2012. Per-share earnings of $2.55 beat the expectations of analysts polled by Bloomberg by 46 cents.
M&T's strong quarter was driven by gains on the sale of its holdings in Visa and MasterCard, which brought in $103 million. Including this gain, M&T's noninterest income rose 30%, to $508.7 million. Mortgage banking revenue rose 31%, to $91.3 million, and trading and foreign-exchange gains rose 48%, to $9.2 million. The bank's gain on Visa and MasterCard sales was partially offset by a $46 million loss on the sale of privately issued collateralized mortgage debt.
M&T's net interest income was $677.6 million, 5% higher than in the second quarter of 2012, despite a tightening of its net interest margin by 3 basis points, to 3.71%. Its portfolio of loans and leases grew by 7%, to $66 billion.
M&T's expenses related to bad loans remained roughly level, as its provision for loan losses dipped to $57 million, $3 million lower than in the year-prior period, while chargeoffs rose to $57 million, $5 million higher.
M&T's noninterest expense fell 4%, to $599 million, due largely to the amortization of deposits and other assets and lower costs related to the Federal Deposit Insurance Corp.'s assessment of foreclosed assets.
M&T's $3.7 billion deal to acquire Hudson City Bancorp (HCBK) is on hold after the Federal Reserve Board