M&T Bank Q4 Earnings Beat Estimates on Fee Income Growth, Stock Up

Core Viewpoint - M&T Bank Corporation reported strong fourth-quarter 2024 earnings, with adjusted net operating earnings per share of $3.92, exceeding expectations and showing significant year-over-year growth from $2.81 per share [1][2]. Financial Performance - For the fourth quarter of 2024, adjusted net operating earnings per share was $14.64, surpassing the Zacks Consensus Estimate of $14.58, but down from $15.79 in the previous year [2]. - Net income available to common shareholders was $644 million, reflecting a 40.9% increase from the prior-year quarter, while full-year net income was $2.44 billion, a decline of 7.1% year over year [3]. - Quarterly revenues reached $2.39 billion, exceeding the Zacks Consensus Estimate of $2.3 billion and increasing by 3.7% year over year [4]. - Total non-interest income was $657 million, up 13.7% year over year, driven by increases in trust income and service charges [5]. - Total non-interest expenses decreased by 6% year over year to $1.36 billion, primarily due to lower FDIC assessment charges [5]. Efficiency and Profitability - The efficiency ratio improved to 56.8%, down from 62.1% in the previous year, indicating enhanced profitability [6]. - The estimated Common Equity Tier 1 ratio rose to 11.67%, up from 10.98% in the fourth quarter of 2023, reflecting a stronger capital position [10]. Loan and Deposit Trends - Loans and leases increased to $135.7 billion, up nearly 1% from the prior quarter, while total deposits fell by 2.1% to $161.1 billion [7]. - The ratio of non-accrual loans to total net loans decreased to 1.25%, down from 1.62% year over year, indicating improved credit quality [9]. Credit Quality - Net charge-offs rose by 8.1% to $160 million compared to the prior-year quarter, while the provision for credit losses decreased by 37.8% to $140 million [8]. - Non-performing assets declined by 21.8% year over year to $1.73 billion, suggesting an improvement in asset quality [8]. Capital Management - M&T Bank repurchased 957,988 shares of its common stock for $200 million in the fourth quarter of 2024, reflecting a commitment to capital distribution [11]. Future Outlook - The company anticipates that rising loan balances and non-interest income will support organic growth, although declining deposit balances and increasing net charge-offs present near-term challenges [12].