M&T Bank Corp. (MTB), financial holding company for regional lender M&T Bank, Monday reported a significant increase in first-quarter profit, led by higher residential mortgage banking revenues and lower credit costs.
Net income available to common shareholders increased 36 percent to $255.1 million from last year's $188.24 million. Earnings per share advanced to $1.98 from $1.50. After adjusting for amortization of core deposit and other intangible expenses as well as merger-related expenses, net operating earnings per common share was $2.06, while it stood at $1.59 last year.
On average, 22 analysts polled by Thomson Reuters expected earnings of $1.96 per share for the quarter. Analysts' estimates typically exclude special items.
Net interest income grew 6 percent to $656.05 million from $620.39 million in the previous year. Taxable-equivalent net interest income rose 6 percent to $663 million, amid an increase in average earning assets, fueled by $5.4 billion of growth in average loans and leases.
Mortgage banking revenues climbed 66 percent to $93.10 million from $56.19 million, benefiting from increased loan volumes and wider margins.
Trust income grew 4 percent to $121.60 million and Brokerage services income were 13 percent higher at $15.71 million.
Provision for credit losses fell 22 percent to $38 million from $49 million in the previous year. Net charge-offs of loans were $37 million, down from $48 million in the first quarter of 2012.
Rene Jones, chief financial officer, said, "Residential mortgage banking revenues continued to be robust and trust income grew nicely from last year's fourth quarter. Credit costs in the recent quarter were well below our historical trends, with the ratio of net charge-offs to average loans improving to .23%."
MTB closed on Friday at $100.24. The stock is up 2.7 percent in pre-market activity.
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