M&T Bank's earnings up 38% in 2nd quarter

Numbers enhanced by loan, deposit growth and expense control

July 13, 2004|By Bill Atkinson | Bill Atkinson,Sun STAFF

M&T Bank Corp. said yesterday that profit in the second quarter jumped 38 percent on strong loan and deposit growth and expense control.

The Buffalo, N.Y.-based banking company, which acquired Baltimore's Allfirst Financial Inc. last year, made $184 million in the quarter that ended June 30, compared with $134 million in last year's second quarter.

Diluted earnings per share rose 39 percent to $1.53, compared with $1.10 a year earlier, the company said.

The results surprised Wall Street analysts, who expected the company to report $1.45 per share, according to Thomson Financial, which tallied the estimates of 10 analysts who follow the company.

"It was a good quarter," said Erik Eisenstein, a banking analyst at S&P Equity Research in New York. "It was solid in pretty much all respects."

Shares of M&T jumped $3.70 to $91.60 yesterday.

It was the first quarter that year-over-year and quarterly comparisons included the results of Allfirst, which was acquired on April 1, 2003. M&T bought the Baltimore banking company from Dublin-based Allied Irish Banks PLC in the wake of a major currency trading scandal.

"While many of the cultural elements of the integration will yet take some time, the financial results of the merger continue to meet or exceed our initial expectations," Michael Pinto, M&T's chief financial officer said in a conference call yesterday.

In the first six months of the year, M&T made $344 million, or $2.83 a share, compared with $251 million, or $2.30 a share, in the first half of 2003. Assets rose to $52.1 billion, up 3.4 percent from a year earlier.

Pinto said deposit growth during the quarter was strong across the board. Deposits rose 7.7 percent to $35 billion at quarter's end, up from $32.5 billion a year earlier.

"We think it is widespread and somewhat reflective of the economic conditions in our area," Pinto said.

He said loan growth has been "very encouraging" in M&T's traditional markets such as Buffalo and Syracuse as well as in new markets throughout Maryland.

"Commercial loans grew gangbusters," Pinto said.

Michael S. Piemonte, senior vice president at M&T, said the company was "thrilled" with the performance.

"There is obviously things we would like to work on," he said. "We would obviously like to see expenses come down."

M&T's expenses were $357 million in the second quarter, down 17 percent from $431 million in 2003's second quarter.

Problem loans fell 40 percent in the quarter, to $190 million from $319 million a year earlier.

The problem loans, called nonperforming loans, represent just 0.51 percent of M&T's total loans, the company said.

Also yesterday, SunTrust Banks Inc., another large regional bank with operations in Maryland, reported that its second-quarter profit rose 10.4 percent to $364.8 million, up from $330.4 million a year earlier.

SunTrust, which operates 62 branches in the Maryland region, said net income per diluted share was $1.29 in the quarter compared with $1.17 in the second quarter of 2003.

The Atlanta-based banking company, which had $128.1 billion in assets at the end of the quarter, made $723.3 million in the first half of the year, or $2.55 a share, up 9.9 percent from a year earlier.

Shares of SunTrust Banks rose $1.62 to $66 in trading on the New York Stock Exchange yesterday.

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