☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

☐ ~~TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934~~

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes ☒ No

Number of shares of the registrant's Common Stock, $0.50 par value, outstanding as of the close of business on ~~August~~May 1, ~~2023:~~2024: ~~165,948,636~~166,854,421 shares.

4. Loans and leases and the allowance for credit losses

A summary of current, past due and nonaccrual loans as of ~~June 30, 2023~~March 31, 2024 and December 31, ~~2022~~2023 follows:


	Current		30-89 Days Past Due		Accruing Loans Past Due 90 Days or More		Nonaccrual		Total
	(In thousands)
June 30, 2023
Commercial, financial, leasing, etc.	$	43,939,557	$	289,931	$	38,039	$	416,022	$	44,683,549
(Dollars in millions)											Current		30-89 Days Past Due		Accruing Loans Past Due 90 Days or More		Nonaccrual		Total
March 31, 2024
Commercial and industrial											$	56,803	$	219	$	11	$	864	$	57,897
Real estate:
Commercial		34,861,282		450,072		37,542		1,383,190		36,732,086
Commercial (a)												24,119		163		31		855		25,168
Residential builder and developer		1,115,373		18,745		—		1,193		1,135,311		984		48		—		3		1,035
Other commercial construction		6,465,258		154,908		15,124		146,024		6,781,314		5,915		155		2		141		6,213
Residential		21,666,324		581,806		284,410		238,509		22,771,049
Residential (b)												21,118		627		245		202		22,192
Residential — limited documentation		900,609		23,945		—		66,614		991,168		801		30		—		53		884
Consumer:
Home equity lines and loans		4,669,522		26,478		—		77,090		4,773,090		4,437		34		—		87		4,558
Recreational finance		9,171,034		53,483		—		32,286		9,256,803		10,553		71		—		30		10,654
Automobile		4,020,722		40,974		—		21,791		4,083,487		4,252		43		—		13		4,308
Other		2,062,277		15,769		4,964		52,862		2,135,872		1,982		20		8		54		2,064
Total	$	128,871,958	$	1,656,111	$	380,079	$	2,435,581	$	133,343,729	$	130,964	$	1,410	$	297	$	2,302	$	134,973

December 31, 2022
Commercial, financial, leasing, etc.	$	40,982,398	$	448,462	$	72,502	$	347,204	$	41,850,566
December 31, 2023
Commercial and industrial											$	56,091	$	238	$	11	$	670	$	57,010
Real estate:
Commercial		34,972,627		311,188		67,696		1,396,662		36,748,173
Commercial (a)												24,072		311		25		869		25,277
Residential builder and developer		1,304,798		8,703		—		1,229		1,314,730		1,065		5		—		3		1,073
Other commercial construction		6,936,661		239,521		549		124,937		7,301,668		6,322		159		1		171		6,653
Residential		21,491,506		595,897		345,402		272,090		22,704,895
Residential (b)												21,080		763		295		215		22,353
Residential — limited documentation		950,782		22,456		—		77,814		1,051,052		825		31		—		55		911
Consumer:
Home equity lines and loans		4,891,311		30,787		—		84,788		5,006,886		4,528		40		—		81		4,649
Recreational finance		8,974,171		54,593		—		44,630		9,073,394		9,935		87		—		36		10,058
Automobile		4,393,206		44,486		—		39,584		4,477,276		3,918		60		—		14		3,992
Other		1,958,196		22,961		4,869		49,497		2,035,523		2,003		30		7		52		2,092
Total	$	126,855,656	$	1,779,054	$	491,018	$	2,438,435	$	131,564,163	$	129,839	$	1,724	$	339	$	2,166	$	134,068

(a)

Commercial real estate loans held for sale were $563 million at March 31, 2024 and $189 million at December 31, 2023.

(b)

One-to-four family residential mortgage loans held for sale were $165 million at March 31, 2024 and $190 million at December 31, 2023.

- 1413 -

NOTES TO FINANCIAL STATEMENTS, CONTINUED

4. Loans and leases and the allowance for credit losses, continued

~~One-to-four family residential mortgage loans held for sale were $216~~ ~~million and $~~32 ~~million at June 30, 2023 and December 31, 2022, respectively. Commercial real estate loans held for sale were $322~~ ~~million at June 30, 2023 and $131~~ ~~million at December 31, 2022.~~

Credit quality indicators

The Company utilizes a loan grading system to differentiate risk amongst its commercial and industrial loans and commercial real estate loans. Loans with a lower expectation of default are assigned one of ten possible “pass” loan grades and are generally ascribed lower loss factors when determining the allowance for credit losses. Loans with an elevated level of credit risk are classified as “criticized” and are ascribed a higher loss factor when determining the allowance for credit losses. Criticized loans may be classified as “nonaccrual” if the Company no longer expects to collect all amounts according to the contractual terms of the loan agreement or the loan is delinquent 90 days or more.

Line of business personnel in different geographic locations with support from and review by the Company’s credit risk personnel review and reassign loan grades based on their detailed knowledge of individual borrowers and their judgment of the impact on such borrowers resulting from changing conditions in their respective regions. Factors considered in assigning loan grades include borrower-specific information related to expected future cash flows and operating results, collateral values, geographic location, financial condition and performance, payment status, and other information. The Company’s policy is that at least annually, updated financial information be obtained from commercial borrowers associated with pass grade loans and additional analysis performed. On a quarterly basis, the Company’s credit personnel review all criticized commercial and industrial loans and commercial real estate loans greater than $15 million to determine the appropriateness of the assigned loan grade, including whether the loan should be reported as accruing or nonaccruing.

~~- 15 -~~

~~NOTES TO FINANCIAL STATEMENTS, CONTINUED~~

~~4. Loans and leases and the allowance for credit losses, continued~~

The following table summarizes the loan grades applied at ~~June 30, 2023~~March 31, 2024 to the various classes of the Company’s commercial and industrial loans and commercial real estate loans and gross charge-offs for those types of loans for the three-month ~~and six-month periods~~period ended ~~June 30, 2023~~March 31, 2024 by origination year.


	Term Loans by Origination Year												Revolving		Revolving Loans Converted to Term					Term Loans by Origination Year												Revolving		Revolving Loans Converted to Term
	2023		2022		2021		2020		2019		Prior		Loans		Loans		Total
	(In thousands)
Commercial, financial, leasing, etc.:
Loan grades:
(Dollars in millions)																				2024		2023		2022		2021		2020		Prior		Loans		Loans		Total
Commercial and industrial:																			Commercial and industrial:
Pass	$	4,084,263		7,437,543		4,342,236		1,680,841		1,434,684		2,313,703		21,051,384		45,539	$	42,390,193		$	2,012	$	8,129	$	7,567	$	4,441	$	2,099	$	6,456	$	22,719	$	74	$	53,497
Criticized accrual		89,277		242,232		245,040		169,817		108,865		282,663		715,380		24,060		1,877,334			32		306		422		277		117		602		1,745		35		3,536
Criticized nonaccrual		12,072		48,988		44,163		23,131		27,809		94,343		156,738		8,778		416,022			2		54		89		62		71		206		364		16		864
Total commercial, financial, leasing, etc.	$	4,185,612		7,728,763		4,631,439		1,873,789		1,571,358		2,690,709		21,923,502		78,377	$	44,683,549
Gross charge-offs three months ended June 30, 2023	$	728		6,854		4,705		3,999		2,214		2,758		—		—	$	21,258
Gross charge-offs six months ended June 30, 2023	$	835		10,958		8,110		6,752		4,517		8,315		773		—	$	40,260
Total commercial and industrial																				$	2,046	$	8,489	$	8,078	$	4,780	$	2,287	$	7,264	$	24,828	$	125	$	57,897
Gross charge-offs																				$	—	$	7	$	9	$	4	$	3	$	5	$	50	$	—	$	78
Real estate:
Commercial:
Loan grades:
Pass	$	2,087,296		3,865,108		3,188,161		3,200,526		4,693,259		12,993,821		797,521		—	$	30,825,692		$	696	$	1,783	$	1,652	$	1,331	$	2,013	$	11,278	$	435	$	—	$	19,188
Criticized accrual		—		403,062		434,027		354,736		788,370		2,519,575		23,434		—		4,523,204			—		273		815		464		558		3,008		7		—		5,125
Criticized nonaccrual		—		50,989		25,903		258,813		146,925		894,172		6,388		—		1,383,190			—		—		46		11		101		695		2		—		855
Total commercial real estate	$	2,087,296		4,319,159		3,648,091		3,814,075		5,628,554		16,407,568		827,343		—	$	36,732,086		$	696	$	2,056	$	2,513	$	1,806	$	2,672	$	14,981	$	444	$	—	$	25,168
Gross charge-offs three months ended June 30, 2023	$	—		—		—		424		51,516		49,433		—		—	$	101,373
Gross charge-offs six months ended June 30, 2023	$	—		—		—		424		77,906		51,911		—		—	$	130,241
Gross charge-offs																				$	—	$	—	$	—	$	—	$	—	$	13	$	—	$	—	$	13
Residential builder and developer:
Loan grades:
Pass	$	215,809		518,867		99,364		9,681		7,122		15,204		126,638		—	$	992,685		$	89	$	509	$	187	$	34	$	5	$	14	$	102	$	—	$	940
Criticized accrual		1,013		6,499		34,803		2,329		74,015		20,601		2,173		—		141,433			—		2		21		21		—		46		2		—		92
Criticized nonaccrual		—		—		675		—		518		—		—		—		1,193			—		—		—		2		—		1		—		—		3
Total residential builder and developer	$	216,822		525,366		134,842		12,010		81,655		35,805		128,811		—	$	1,135,311		$	89	$	511	$	208	$	57	$	5	$	61	$	104	$	—	$	1,035
Gross charge-offs three months ended June 30, 2023	$	—		—		—		—		—		44		172		—	$	216
Gross charge-offs six months ended June 30, 2023	$	—		—		—		—		—		55		1,678		—	$	1,733
Gross charge-offs																				$	—	$	—	$	—	$	—	$	—	$	1	$	—	$	—	$	1
Other commercial construction:
Loan grades:
Pass	$	391,286		1,373,928		1,025,430		952,484		550,745		271,623		15,867		—	$	4,581,363		$	27	$	990	$	1,231	$	590	$	273	$	589	$	45	$	—	$	3,745
Criticized accrual		245		53,186		173,616		446,290		945,352		435,238		—		—		2,053,927			—		75		538		460		567		687		—		—		2,327
Criticized nonaccrual		—		—		10,202		42,275		63,702		27,422		2,423		—		146,024			—		—		11		10		45		75		—		—		141
Total other commercial construction	$	391,531		1,427,114		1,209,248		1,441,049		1,559,799		734,283		18,290		—	$	6,781,314		$	27	$	1,065	$	1,780	$	1,060	$	885	$	1,351	$	45	$	—	$	6,213
Gross charge-offs three months ended June 30, 2023	$	—		—		—		—		—		—		—		—	$	—
Gross charge-offs six months ended June 30, 2023	$	—		—		—		—		—		—		—		—	$	—
Gross charge-offs																				$	—	$	—	$	2	$	—	$	—	$	7	$	2	$	—	$	11

- 14 -

NOTES TO FINANCIAL STATEMENTS, CONTINUED

4. Loans and leases and the allowance for credit losses, continued

The Company considers repayment performance a significant indicator of credit quality for its residential real estate loan and consumer loan portfolios. A summary of loans in accrual and nonaccrual status at ~~June 30, 2023~~March 31, 2024 for the various classes of the Company’s residential real estate loans and consumer loans and gross charge-offs for those types of loans for the three-month ~~and six-month periods~~period ended ~~June 30, 2023~~March 31, 2024 by origination year ~~follows.~~follows:


	Term Loans by Origination Year												Revolving		Revolving Loans Converted to Term
(Dollars in millions)	2024		2023		2022		2021		2020		Prior		Loans		Loans		Total
Residential:
Current	$	478	$	1,499	$	4,667	$	3,717	$	2,533	$	8,131	$	93	$	—	$	21,118
30-89 days past due		—		6		107		62		30		422		—		—		627
Accruing loans past due 90 days or more		—		2		21		19		15		188		—		—		245
Nonaccrual		—		1		15		10		2		173		1		—		202
Total residential	$	478	$	1,508	$	4,810	$	3,808	$	2,580	$	8,914	$	94	$	—	$	22,192
Gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	1	$	—	$	—	$	1
Residential - limited documentation:
Current	$	—	$	—	$	—	$	—	$	—	$	801	$	—	$	—	$	801
30-89 days past due		—		—		—		—		—		30		—		—		30
Accruing loans past due 90 days or more		—		—		—		—		—		—		—		—		—
Nonaccrual		—		—		—		—		—		53		—		—		53
Total residential - limited documentation	$	—	$	—	$	—	$	—	$	—	$	884	$	—	$	—	$	884
Gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Consumer:
Home equity lines and loans:
Current	$	—	$	—	$	—	$	2	$	2	$	105	$	2,972	$	1,356	$	4,437
30-89 days past due		—		—		—		—		—		3		—		31		34
Accruing loans past due 90 days or more		—		—		—		—		—		—		—		—		—
Nonaccrual		—		—		—		—		—		5		1		81		87
Total home equity lines and loans	$	—	$	—	$	—	$	2	$	2	$	113	$	2,973	$	1,468	$	4,558
Gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	1	$	1
Recreational finance:
Current	$	1,028	$	2,531	$	2,252	$	1,790	$	1,233	$	1,719	$	—	$	—	$	10,553
30-89 days past due		1		11		12		14		13		20		—		—		71
Accruing loans past due 90 days or more		—		—		—		—		—		—		—		—		—
Nonaccrual		—		4		6		6		4		10		—		—		30
Total recreational finance	$	1,029	$	2,546	$	2,270	$	1,810	$	1,250	$	1,749	$	—	$	—	$	10,654
Gross charge-offs	$	—	$	3	$	5	$	6	$	4	$	7	$	—	$	—	$	25
Automobile:
Current	$	684	$	1,026	$	1,004	$	942	$	371	$	225	$	—	$	—	$	4,252
30-89 days past due		1		7		11		11		6		7		—		—		43
Accruing loans past due 90 days or more		—		—		—		—		—		—		—		—		—
Nonaccrual		—		2		2		3		2		4		—		—		13
Total automobile	$	685	$	1,035	$	1,017	$	956	$	379	$	236	$	—	$	—	$	4,308
Gross charge-offs	$	—	$	2	$	2	$	2	$	1	$	1	$	—	$	—	$	8
Other:
Current	$	69	$	219	$	155	$	105	$	28	$	27	$	1,378	$	1	$	1,982
30-89 days past due		1		1		3		1		—		1		12		1		20
Accruing loans past due 90 days or more		—		—		—		—		—		—		8		—		8
Nonaccrual		1		1		1		—		—		—		51		—		54
Total other	$	71	$	221	$	159	$	106	$	28	$	28	$	1,449	$	2	$	2,064
Gross charge-offs	$	1	$	3	$	3	$	1	$	1	$	—	$	16	$	—	$	25
Total loans and leases at March 31, 2024	$	5,121	$	17,431	$	20,835	$	14,385	$	10,088	$	35,581	$	29,937	$	1,595	$	134,973
Total gross charge-offs for the three months ended March 31, 2024	$	1	$	15	$	21	$	13	$	9	$	35	$	68	$	1	$	163

~~- 16 -~~

~~NOTES TO FINANCIAL STATEMENTS, CONTINUED~~

~~4. Loans and leases and the allowance for credit losses, continued~~

Term Loans by Origination Year

Revolving

Revolving Loans Converted to Term

2023

2022

2021

2020

2019

Prior

Loans

Loans

Total

(In thousands)

Residential:

Current

$
1,078,612

4,916,628

3,904,324

2,663,709

1,266,549

7,756,199

80,303

—

$
21,666,324

30-89 days past due

4,818

77,407

49,908

33,051

23,741

392,794

87

—

581,806

Accruing loans past due
    90 days or more

170

24,637

26,574

16,174

13,590

203,265

—

—

284,410

Nonaccrual

140

12,497

14,259

2,286

8,254

194,394

6,679

—

238,509

Total residential

$
1,083,740

5,031,169

3,995,065

2,715,220

1,312,134

8,546,652

87,069

—

$
22,771,049

Gross charge-offs three months ended June 30, 2023

$
—

58

77

-

71

639

—

—

$
845

Gross charge-offs six months ended June 30, 2023

$
—

133

192

21

139

1,925

—

—

$
2,410

Residential - limited documentation:

Current

$
—

—

—

—

—

900,609

—

—

$
900,609

30-89 days past due

—

—

—

—

—

23,945

—

—

23,945

Accruing loans past due
    90 days or more

—

—

—

—

—

—

—

—

—

Nonaccrual

—

—

—

—

—

66,614

—

—

66,614

Total residential - limited
   documentation

$
—

—

—

—

—

991,168

—

—

$
991,168

Gross charge-offs three months ended June 30, 2023

$
—

—

—

—

—

227

—

—

$
227

Gross charge-offs six months ended June 30, 2023

$
—

—

—

—

—

363

—

—

$
363

Consumer:

Home equity lines and loans:

Current

$
32

31

1,962

2,164

14,100

109,021

3,082,721

1,459,491

$
4,669,522

30-89 days past due

—

—

—

55

309

1,670

—

24,444

26,478

Accruing loans past due
    90 days or more

—

—

—

—

—

—

—

—

—

Nonaccrual

—

—

32

—

65

6,298

1,140

69,555

77,090

Total home equity lines and loans

$
32

31

1,994

2,219

14,474

116,989

3,083,861

1,553,490

$
4,773,090

Gross charge-offs three months ended June 30, 2023

$
—

—

—

—

—

53

—

1,113

$
1,166

Gross charge-offs six months ended June 30, 2023

$
—

—

—

—

—

84

1,298

1,817

$
3,199

Recreational finance:

Current

$
1,111,625

2,572,098

2,047,511

1,420,955

866,786

1,152,059

—

—

$
9,171,034

30-89 days past due

1,345

9,290

12,008

10,542

7,690

12,608

—

—

53,483

Accruing loans past due
    90 days or more

—

—

—

—

—

—

—

—

—

Nonaccrual

554

2,977

6,984

5,775

4,706

11,290

—

—

32,286

Total recreational finance

$
1,113,524

2,584,365

2,066,503

1,437,272

879,182

1,175,957

—

—

$
9,256,803

Gross charge-offs three months ended June 30, 2023

$
873

2,781

3,014

2,746

1,751

3,315

—

—

$
14,480

Gross charge-offs six months ended June 30, 2023

$
873

5,150

6,027

5,731

4,163

7,357

—

—

$
29,301

Automobile:

Current

$
442,880

1,298,446

1,285,910

553,840

280,257

159,389

—

—

$
4,020,722

30-89 days past due

1,731

9,576

12,148

6,187

5,479

5,853

—

—

40,974

Accruing loans past due
    90 days or more

—

—

—

—

—

—

—

—

—

Nonaccrual

648

2,521

7,163

3,988

3,299

4,172

—

—

21,791

Total automobile

$
445,259

1,310,543

1,305,221

564,015

289,035

169,414

—

—

$
4,083,487

Gross charge-offs three months ended June 30, 2023

$
81

1,183

1,916

708

526

517

—

—

$
4,931

Gross charge-offs six months ended June 30, 2023

$
81

2,819

3,984

1,877

1,483

1,398

—

—

$
11,642

Other:

Current

$
154,995

222,468

142,584

44,462

25,013

22,444

1,444,863

5,448

2,062,277

30-89 days past due

2,113

1,885

1,304

235

221

502

8,979

530

$
15,769

Accruing loans past due
    90 days or more

—

—

—

—

—

181

4,783

—

4,964

Nonaccrual

1,434

665

445

135

127

335

49,565

156

52,862

Total other

$
158,542

225,018

144,333

44,832

25,361

23,462

1,508,190

6,134

$
2,135,872

Gross charge-offs three months ended June 30, 2023

$
5,201

3,203

2,261

1,209

1,334

4,348

172

—

$
17,728

Gross charge-offs six months ended June 30, 2023

$
6,113

11,860

4,996

2,604

2,915

9,334

192

—

$
38,014

Total loans and leases at
   June 30, 2023

$
9,682,358

23,151,528

17,136,736

11,904,481

11,361,552

30,892,007

27,577,066

1,638,001

$
133,343,729

Total gross charge-offs for
   the three months
   ended June 30, 2023

$
6,883

14,079

11,973

9,086

57,412

61,334

344

1,113

$
162,224

Total gross charge-offs for
   the six months
   ended June 30, 2023

$
7,902

30,920

23,309

17,409

91,123

80,742

3,941

1,817

$
257,163

- 1715 -

NOTES TO FINANCIAL STATEMENTS, CONTINUED

4. Loans and leases and the allowance for credit losses, continued

The following table summarizes the loan grades applied at December 31, ~~2022~~2023 to the various classes of the Company’s commercial and industrial loans and commercial real estate loans by origination year.


	Term Loans by Origination Year												Revolving		Revolving Loans Converted to Term					Term Loans by Origination Year												Revolving		Revolving Loans Converted to Term
	2022		2021		2020		2019		2018		Prior		Loans		Loans		Total
	(In thousands)
Commercial, financial, leasing, etc.:
Loan grades:
(Dollars in millions)																				2023		2022		2021		2020		2019		Prior		Loans		Loans		Total
Commercial and industrial:																			Commercial and industrial:
Pass	$	8,575,130		4,952,758		2,024,603		1,796,047		817,569		1,970,947		19,444,247		40,471	$	39,621,772		$	8,689	$	8,087	$	4,800	$	2,248	$	2,169	$	4,843	$	22,345	$	70	$	53,251
Criticized accrual		247,626		222,861		190,368		116,881		71,485		246,846		768,497		17,026		1,881,590			292		279		277		142		127		481		1,460		31		3,089
Criticized nonaccrual		18,379		52,067		37,608		36,241		35,689		59,146		100,972		7,102		347,204			29		68		56		75		36		150		243		13		670
Total commercial, financial, leasing, etc.	$	8,841,135		5,227,686		2,252,579		1,949,169		924,743		2,276,939		20,313,716		64,599	$	41,850,566

Total commercial and industrial																				$	9,010	$	8,434	$	5,133	$	2,465	$	2,332	$	5,474	$	24,048	$	114	$	57,010
Real estate:
Commercial:
Loan grades:
Pass	$	4,136,890		3,379,900		3,388,590		4,557,065		3,293,380		10,905,956		869,981		—	$	30,531,762		$	2,048	$	1,742	$	1,367	$	2,011	$	3,059	$	8,491	$	440	$	—	$	19,158
Criticized accrual		324,652		463,484		467,557		688,239		937,421		1,890,297		48,099		—		4,819,749			227		891		465		456		966		2,238		7		—		5,250
Criticized nonaccrual		11,541		22,459		183,986		297,106		170,382		688,079		23,109		—		1,396,662			—		46		3		113		93		611		3		—		869
Total commercial real estate	$	4,473,083		3,865,843		4,040,133		5,542,410		4,401,183		13,484,332		941,189		—	$	36,748,173		$	2,275	$	2,679	$	1,835	$	2,580	$	4,118	$	11,340	$	450	$	—	$	25,277

Residential builder and developer:
Loan grades:
Pass	$	680,705		230,079		11,280		22,111		12,812		9,865		150,404		—	$	1,117,256		$	530	$	252	$	41	$	6	$	2	$	12	$	116	$	—	$	959
Criticized accrual		2,969		28,472		9,952		108,968		15,069		—		30,815		—		196,245			1		18		30		—		59		—		3		—		111
Criticized nonaccrual		57		654		—		518		—		—		—		—		1,229			—		—		3		—		—		—		—		—		3
Total residential builder and developer	$	683,731		259,205		21,232		131,597		27,881		9,865		181,219		—	$	1,314,730		$	531	$	270	$	74	$	6	$	61	$	12	$	119	$	—	$	1,073

Other commercial construction:
Loan grades:
Pass	$	1,032,774		1,080,141		1,225,845		1,185,685		366,686		297,355		15,575		—	$	5,204,061		$	813	$	1,366	$	651	$	373	$	646	$	187	$	30	$	—	$	4,066
Criticized accrual		37,893		145,199		320,463		1,025,371		299,350		144,394		—		—		1,972,670			53		391		390		691		565		326		—		—		2,416
Criticized nonaccrual		—		9,992		44,037		35,841		10,542		22,099		2,426		—		124,937			—		14		10		46		50		49		2		—		171
Total other commercial construction	$	1,070,667		1,235,332		1,590,345		2,246,897		676,578		463,848		18,001		—	$	7,301,668		$	866	$	1,771	$	1,051	$	1,110	$	1,261	$	562	$	32	$	—	$	6,653

- 1816 -

NOTES TO FINANCIAL STATEMENTS, CONTINUED

4. Loans and leases and the allowance for credit losses, continued

A summary of loans in accrual and nonaccrual status at December 31, ~~2022~~2023 for the various classes of the Company’s residential real estate loans and consumer loans by origination year ~~follows.~~follows:


		Term Loans by Origination Year												Revolving		Revolving Loans Converted to Term					Term Loans by Origination Year												Revolving		Revolving Loans Converted to Term
		2022		2021		2020		2019		2018		Prior		Loans		Loans		Total
		(In thousands)
(Dollars in millions)																					2023		2022		2021		2020		2019		Prior		Loans		Loans		Total
Residential:
Current		$	5,071,379		4,001,652		2,717,371		1,392,866		753,908		7,523,890		30,440		—	$	21,491,506		$	1,726	$	4,709	$	3,732	$	2,543	$	1,215	$	7,060	$	95	$	—	$	21,080
30-89 days past due			59,477		51,308		40,337		21,849		23,126		399,301		499		—		595,897			18		120		88		52		28		457		—		—		763
Accruing loans past due 90 days or more			12,012		39,934		20,067		14,050		14,007		245,332		—		—		345,402			1		30		28		17		14		205		—		—		295
Nonaccrual			5,686		10,865		2,583		9,860		4,650		231,093		7,353		—		272,090			1		17		10		3		4		179		1		—		215
Total residential		$	5,148,554		4,103,759		2,780,358		1,438,625		795,691		8,399,616		38,292		—	$	22,704,895		$	1,746	$	4,876	$	3,858	$	2,615	$	1,261	$	7,901	$	96	$	—	$	22,353

Residential - limited documentation:	Residential - limited documentation:																			Residential - limited documentation:
Current		$	—		—		—		—		—		950,782		—		—	$	950,782		$	—	$	—	$	—	$	—	$	—	$	825	$	—	$	—	$	825
30-89 days past due			—		—		—		—		—		22,456		—		—		22,456			—		—		—		—		—		31		—		—		31
Accruing loans past due 90 days or more			—		—		—		—		—		—		—		—		—			—		—		—		—		—		—		—		—		—
Nonaccrual			—		—		—		—		—		77,814		—		—		77,814			—		—		—		—		—		55		—		—		55
Total residential - limited documentation		$	—		—		—		—		—		1,051,052		—		—	$	1,051,052		$	—	$	—	$	—	$	—	$	—	$	911	$	—	$	—	$	911

Consumer:
Home equity lines and loans:
Current		$	930		2,109		2,441		15,361		23,321		97,282		3,262,533		1,487,334	$	4,891,311		$	—	$	—	$	2	$	2	$	13	$	98	$	3,022	$	1,391	$	4,528
30-89 days past due			—		—		—		171		126		2,030		—		28,460		30,787			—		—		—		—		—		3		—		37		40
Accruing loans past due 90 days or more			—		—		—		—		—		—		—		—		—			—		—		—		—		—		—		—		—		—
Nonaccrual			—		15		—		536		334		6,458		2,799		74,646		84,788			—		—		—		—		—		5		3		73		81
Total home equity lines and loans		$	930		2,124		2,441		16,068		23,781		105,770		3,265,332		1,590,440	$	5,006,886		$	—	$	—	$	2	$	2	$	13	$	106	$	3,025	$	1,501	$	4,649

Recreational finance:	Recreational finance:																			Recreational finance:
Current		$	2,842,091		2,280,627		1,587,629		963,907		486,964		812,953		—		—	$	8,974,171		$	2,653	$	2,338	$	1,857	$	1,286	$	781	$	1,020	$	—	$	—	$	9,935
30-89 days past due			8,648		9,525		12,412		8,387		5,202		10,419		—		—		54,593			11		16		19		14		11		16		—		—		87
Accruing loans past due 90 days or more			—		—		—		—		—		—		—		—		—			—		—		—		—		—		—		—		—		—
Nonaccrual			3,533		7,440		9,427		7,625		5,344		11,261		—		—		44,630			3		5		8		6		5		9		—		—		36
Total recreational finance		$	2,854,272		2,297,592		1,609,468		979,919		497,510		834,633		—		—	$	9,073,394		$	2,667	$	2,359	$	1,884	$	1,306	$	797	$	1,045	$	—	$	—	$	10,058

Automobile:	Automobile:																			Automobile:
Current		$	1,491,076		1,557,676		702,711		378,962		167,438		95,343		—		—	$	4,393,206		$	1,063	$	1,096	$	1,047	$	427	$	198	$	87	$	—	$	—	$	3,918
30-89 days past due			6,926		13,324		7,284		7,239		5,464		4,249		—		—		44,486			8		15		17		9		6		5		—		—		60
Accruing loans past due 90 days or more			—		—		—		—		—		—		—		—		—			—		—		—		—		—		—		—		—		—
Nonaccrual			2,493		10,698		7,372		7,520		5,620		5,881		—		—		39,584			2		3		3		2		2		2		—		—		14
Total automobile		$	1,500,495		1,581,698		717,367		393,721		178,522		105,473		—		—	$	4,477,276		$	1,073	$	1,114	$	1,067	$	438	$	206	$	94	$	—	$	—	$	3,992

Other:	Other:																			Other:
Current		$	274,530		172,238		58,339		38,439		8,217		23,163		1,375,049		8,221	$	1,958,196		$	250	$	176	$	118	$	33	$	13	$	18	$	1,392	$	3	$	2,003
30-89 days past due			3,783		1,450		326		386		141		569		15,655		651		22,961			3		3		2		—		—		1		20		1		30
Accruing loans past due 90 days or more			—		—		—		—		—		226		4,643		—		4,869			—		—		—		—		—		—		7		—		7
Nonaccrual			2,745		830		332		371		120		465		44,449		185		49,497			2		1		1		—		—		—		48		—		52
Total other		$	281,058		174,518		58,997		39,196		8,478		24,423		1,439,796		9,057	$	2,035,523		$	255	$	180	$	121	$	33	$	13	$	19	$	1,467	$	4	$	2,092

Total loans and leases at December 31, 2022		$	24,853,925		18,747,757		13,072,920		12,737,602		7,534,367		26,755,951		26,197,545		1,664,096	$	131,564,163
Total loans and leases at December 31, 2023																					$	18,423	$	21,683	$	15,025	$	10,555	$	10,062	$	27,464	$	29,237	$	1,619	$	134,068

- 1917 -

NOTES TO FINANCIAL STATEMENTS, CONTINUED

4. Loans and leases and the allowance for credit losses, continued

Allowance for credit losses

For purposes of determining the level of the allowance for credit losses, the Company evaluates its loan and lease portfolio by type. Changes in the allowance for credit losses for the three months ended ~~June 30,~~March 31, 2024 and 2023 ~~and 2022~~ were as follows:


	Commercial, Financial,			Real Estate												Commercial and			Real Estate
	Leasing, etc.			Commercial			Residential			Consumer			Total
	(In thousands)
Three Months Ended June 30, 2023
(Dollars in millions)																industrial			Commercial			Residential			Consumer			Total
Three Months Ended March 31, 2024
Beginning balance	$	504,779			743,621			113,192			613,518		$	1,975,110		$	620		$	764		$	116		$	629		$	2,129
Provision for credit losses		11,977			121,092			3,957			12,974			150,000			137			9			2			52			200
Net charge-offs
Net charge-offs:
Charge-offs		(21,258	)		(101,589	)		(1,072	)		(38,305	)		(162,224	)		(78	)		(25	)		(1	)		(59	)		(163	)
Recoveries		16,431			2,552			2,315			14,182			35,480			5			6			1			13			25
Net (charge-offs) recoveries		(4,827	)		(99,037	)		1,243			(24,123	)		(126,744	)
Net charge-offs																	(73	)		(19	)		—			(46	)		(138	)
Ending balance	$	511,929			765,676			118,392			602,369		$	1,998,366		$	684		$	754		$	118		$	635		$	2,191

Three Months Ended June 30, 2022

Beginning balance

$
307,055

539,444

72,581

553,279

$
1,472,359

Allowance on acquired PCD loans

41,003

55,812

1,833

352

99,000

Provision for credit losses (a)

95,917

120,277

50,168

35,638

302,000

Net charge-offs

Charge-offs (b)

(37,925
)

(8,796
)

(2,863
)

(26,030
)

(75,614
)
Recoveries

8,423

1,656

2,607

13,359

26,045

Net charge-offs

(29,502
)

(7,140
)

(256
)

(12,671
)

(49,569
)
Ending balance

$
414,473

708,393

124,326

576,598

$
1,823,790

~~_____________________________________~~

~~(a)~~

~~Includes $242~~ ~~million related to non-PCD acquired loans for the three months ended June 30, 2022.~~

~~(b) For the three months ended June 30, 2022, net charge-offs do not reflect $~~33 ~~million of charge offs related to PCD acquired loans.~~

~~Changes in the allowance for credit losses for the six months ended June 30, 2023 and 2022 were as follows:~~


	Commercial, Financial,			Real Estate
	Leasing, etc.			Commercial			Residential			Consumer			Total
	(In thousands)
Six Months Ended June 30, 2023
Three Months Ended March 31, 2023
Beginning balance	$	502,153			676,684			115,092			631,402		$	1,925,331		$	568		$	611		$	115		$	631		$	1,925
Provision for credit losses		24,164			217,084			2,435			26,317			270,000			21			86			(1	)		14			120
Net charge-offs
Net charge-offs:
Charge-offs		(40,260	)		(131,974	)		(2,773	)		(82,156	)		(257,163	)		(20	)		(29	)		(2	)		(44	)		(95	)
Recoveries		25,872			3,882			3,638			26,806			60,198			10			1			1			13			25
Net (charge-offs) recoveries		(14,388	)		(128,092	)		865			(55,350	)		(196,965	)
Net charge-offs																	(10	)		(28	)		(1	)		(31	)		(70	)
Ending balance	$	511,929			765,676			118,392			602,369		$	1,998,366		$	579		$	669		$	113		$	614		$	1,975

Six Months Ended June 30, 2022

Beginning balance

$
283,899

557,239

71,726

556,362

$
1,469,226

Allowance on acquired PCD loans

41,003

55,812

1,833

352

99,000

Provision for credit losses (a)

124,642

89,339

51,888

46,131

312,000

Net charge-offs

Charge-offs (b)

(57,159
)

(10,596
)

(6,835
)

(52,062
)

(126,652
)
Recoveries

22,088

16,599

5,714

25,815

70,216

Net (charge-offs) recoveries

(35,071
)

6,003

(1,121
)

(26,247
)

(56,436
)
Ending balance

$
414,473

708,393

124,326

576,598

$
1,823,790

~~________________________________________________________________________________________________~~

~~(a)~~

~~Includes $242~~ ~~million related to non-PCD acquired loans for the six months ended June 30, 2022.~~

~~(b) For the six months ended June 30, 2022, net charge-offs do not reflect $~~33 ~~million of charge offs related to PCD acquired loans.~~

Despite the allocation in the preceding tables, the allowance for credit losses is general in nature and is available to absorb losses from any loan or lease type. In determining the allowance for credit losses, accruing loans with similar risk characteristics are generally evaluated collectively. The Company utilizes statistically developed models to project principal balances over the remaining contractual lives of the loan portfolios and to determine estimated credit losses through a reasonable and supportable forecast period. Individual loan credit quality indicators, including loan grade and borrower repayment performance, can inform the models, which have been statistically developed based on historical correlations of credit losses with prevailing economic metrics, including unemployment, ~~gross domestic product~~GDP and real estate prices. Model forecasts may be adjusted for inherent limitations or biases that have been identified through independent validation and back-testing of model performance to actual realized results. At each of ~~June 30, 2023~~March 31, 2024 and December 31, ~~2022,~~2023, the Company utilized a reasonable and supportable forecast period of two years. Subsequent to this forecast period the Company reverted, ratably over a one-year period, to historical loss experience to inform its estimate of losses for the remaining contractual life of each portfolio.

The Company also estimates losses attributable to specific troubled credits identified through both normal and targeted credit review processes. The amounts of specific loss components in the Company’s loan and lease portfolios are determined through a loan-by-loan analysis of larger balance commercial and industrial loans and commercial real estate loans that are in nonaccrual status. Such loss estimates are typically based on expected future cash flows, collateral values and other factors that may impact the borrower’s ability to pay. To the extent that those loans are collateral-dependent, they are evaluated based on the fair value of the loan’s collateral as estimated at or near the financial statement date. As the quality of a loan deteriorates to the point of classifying the loan as “criticized,” the process of obtaining updated collateral valuation information is usually initiated, unless it is not considered warranted given factors such as the relative size of the loan, the characteristics of the collateral or the age of the last valuation. In those cases where current appraisals may not yet be available, prior appraisals are utilized with adjustments, as deemed necessary, for estimates of subsequent declines in values as determined by line of business and/or loan workout personnel. Those adjustments are reviewed and assessed for reasonableness by the Company’s credit risk personnel. Accordingly, for real estate collateral securing larger nonaccrual commercial and industrial loans and commercial real estate loans, estimated collateral values are based on current appraisals and estimates of value. For non-real estate loans, collateral is assigned a discounted estimated liquidation value and, depending on the nature of the collateral, is verified through field exams or other procedures. In assessing collateral, real estate and non-real estate values are reduced by an estimate of selling costs.

For residential real estate loans, including home equity loans and lines of credit, the excess of the loan balance over the net realizable value of the property collateralizing the loan is charged-off when the loan becomes 150 days delinquent. That charge-off is based on recent indications of value from external parties that are generally obtained shortly after a loan becomes nonaccrual. Loans to consumers that file for bankruptcy are generally charged-off to estimated net collateral value shortly after the Company is notified of such filings. When evaluating individual home equity loans and lines of credit for charge-off and for purposes of estimating losses in determining the allowance for credit losses, the Company gives consideration to the required repayment of any first lien positions related to collateral property.

Changes in the amount of the allowance for credit losses reflect the outcome of the procedures described herein, including the impact of changes in macroeconomic forecasts as compared with previous forecasts, as well as the impact of portfolio concentrations, imprecision in economic forecasts, geopolitical conditions and other risk factors that might influence the loss estimation process.

The Company’s reserve for off-balance sheet credit exposures was not material at ~~June 30, 2023~~March 31, 2024 and December 31, ~~2022.~~2023.

4. Loans and ~~2022 follows.~~leases and the allowance for credit losses, continued

During the normal course of business, the Company modifies loans to maximize recovery efforts from borrowers experiencing financial difficulty. Such loan modifications typically include payment deferrals and interest rate reductions but may also include other modified terms. Those modified loans may be considered nonaccrual if the Company does not expect to collect the contractual cash flows owed under the loan agreement. On January 1, 2023 the Company adopted amended guidance that eliminated the accounting guidance for troubled debt restructurings while expanding disclosure requirements for certain loan refinancings and restructurings by creditors when a borrower is experiencing financial difficulty. The amended guidance also requires disclosure of current period gross charge-offs by year of origination.

The financial effects of the modifications for the three-month ~~and six-month~~ periods ended ~~June 30,~~March 31, 2024 and 2023 include an increase in the weighted-average remaining term for commercial and industrial loans of ~~1.0~~0.7 years and ~~1.1~~1.2 years, respectively, for commercial real estate loans, inclusive of residential builder and development loans and other commercial construction loans of ~~1.0~~0.8 years and~~1.1~~ 1.2 years, respectively, and for residential real estate loans of~~8.6~~ 11.4 years and~~8.9~~ 9.1 years, respectively.

Modified loans to borrowers experiencing financial difficulty are subject to the allowance for credit losses methodology described herein, including the use of models to inform credit loss estimates and, to the extent larger balance commercial and industrial loans and commercial real estate loans are in nonaccrual status, a loan-by-loan analysis of expected credit losses on those individual loans. Loans to borrowers experiencing financial difficulty that were modified during the three months ended March 31, 2023 and for which there was a subsequent payment default during that period were not material. The following table summarizes the payment status, at ~~June 30, 2023,~~March 31, 2024, of loans that were modified ~~for~~during the ~~six-month~~twelve-month period ended ~~June 30, 2023:~~March 31, 2024.

The amount of interest income recognized in the Consolidated Statement of Income associated with derivatives designated as cash flow hedges was a decrease of $4987 million and ~~an increase of~~ $2059 million for the three months ended ~~June 30,~~March 31, 2024 and 2023, ~~and 2022, respectively, and a decrease of $108~~ ~~million and an increase of $~~58 ~~million for the six-month period ended June 30, 2023 and 2022,~~ respectively. As of ~~June 30, 2023~~March 31, 2024, the unrealized net loss recognized in other comprehensive income related to cash flow hedges was $~~437~~359 million, of which losses of $121 million, $~~357~~227 million, $129 million and $682 million ~~related~~relate to interest rate swap agreements maturing in 2024, 2025, 2026 and ~~2026,~~2027, respectively.

The Company does not offset derivative asset and liability positions in its consolidated financial statements. The Company’s exposure to credit risk by entering into derivative contracts is mitigated through master netting agreements and collateral posting or settlement requirements. Master netting agreements covering interest rate and foreign exchange contracts with the same party include a right to set-off that becomes enforceable in the event of default, early termination or under other specific conditions.

The aggregate fair value of derivative financial instruments in a liability position, which are subject to enforceable master netting arrangements and the related collateral posted, was not material at each of ~~June 30, 2023~~March 31, 2024 and December 31, ~~2022.~~2023. Certain of the Company’s derivative financial instruments contain provisions that require the Company to maintain specific credit ratings from credit rating agencies to avoid higher collateral posting requirements. If the Company’s debt ratings were to fall below specified ratings, the counterparties of the derivative financial instruments could demand immediate incremental collateralization on those instruments in a net liability position. The aggregate fair value of all derivative financial instruments with such credit risk-related contingent features in a net liability position on ~~June 30, 2023~~March 31, 2024 was not material.

The aggregate fair value of derivative financial instruments in an asset position with counterparties, which are subject to enforceable master netting arrangements, was $~~286~~232 million at ~~June 30, 2023~~March 31, 2024 and $~~314~~179 million at December 31, ~~2022.~~2023. Counterparties posted collateral relating to those positions of $~~262~~231 million at ~~June 30, 2023~~March 31, 2024 and $~~312~~179 million at December 31, ~~2022,~~2023, respectively. Interest rate swap agreements entered into with customers are subject to the Company’s credit risk standards and often contain collateral provisions.

In addition to the derivative contracts noted above, the Company clears certain derivative transactions through a clearinghouse, rather than directly with counterparties. Those transactions cleared through a clearinghouse require initial margin collateral and variation margin payments depending on the contracts being in a net asset or liability position. The amount of initial margin collateral posted by the Company was $96146 million and $~~205~~129 million at ~~June 30, 2023~~March 31, 2024 and December 31, ~~2022,~~2023, respectively. The fair value asset and liability amounts of derivative contracts have been reduced by variation margin payments treated as settlements as described herein. Variation margin on derivative contracts not treated as settlements continues to represent collateral posted or received by the Company.

Commitments to extend credit are agreements to lend to customers, generally having fixed expiration dates or other termination clauses that may require payment of a fee. In addition to the amounts in the preceding table, the Company had discretionary funding commitments to commercial customers of $~~12.5~~12.4 billion and $~~11.7~~12.3 billion at ~~June 30, 2023~~March 31, 2024 and December 31, ~~2022,~~2023, respectively, that the Company had the unconditional right to cancel prior to funding. Standby and commercial letters of credit are conditional commitments issued to guarantee the performance of a customer to a third party. Standby letters of credit generally are contingent upon the failure of the customer to perform according to the terms of the underlying contract with the third party, whereas commercial letters of credit are issued to facilitate commerce and typically result in the commitment being funded when the underlying transaction is consummated between the customer and a third party. The credit risk associated with commitments to extend credit and standby and commercial letters of credit is essentially the same as that involved with extending loans to customers and is subject to normal credit policies. Collateral may be obtained based on management's assessment of the customer's creditworthiness.

Financial guarantees and indemnification contracts are predominantly comprised of recourse obligations associated with sold loans and other guarantees and commitments. Included in financial guarantees and indemnification contracts are loan principal amounts sold with recourse in conjunction with the Company's involvement in the Fannie Mae ~~Delegated Underwriting and Servicing~~DUS program. The Company's maximum credit risk for recourse associated with loans sold under this program totaled approximately $4.0 billion and $3.9 billion at ~~each of June 30, 2023~~March 31, 2024 and December 31, ~~2022.~~2023, respectively. At March 31, 2024, the Company estimated that the recourse obligations described above were not material to the Company's consolidated financial position. There have been no material losses incurred as a result of those credit recourse arrangements.

Since many loan commitments, standby letters of credit, and guarantees and indemnification contracts expire without being funded in whole or in part, the contract amounts are not necessarily indicative of future cash flows.

The Company utilizes commitments to sell real estate loans to hedge exposure to changes in the fair value of real estate loans held for sale. Such commitments are accounted for as derivatives and along with commitments to originate real estate loans to be held for sale are ~~generally~~ recorded in the Consolidated Balance Sheet at estimated fair market value.

The Company is contractually obligated to repurchase previously sold residential real estate loans that do not ultimately meet investor sale criteria related to underwriting procedures or loan documentation. When required to do so, the Company may reimburse loan purchasers for losses incurred or may repurchase certain loans. The Company reduces residential mortgage banking revenues by an estimate for losses related to its obligations to loan purchasers. The amount of those charges is based on the volume of loans sold, the level of reimbursement requests received from loan purchasers and estimates of losses that may be associated with previously sold loans. At ~~June 30, 2023,~~March 31, 2024, the ~~Company believes that its~~Company's estimated obligation to loan purchasers was not material to the Company’s consolidated financial position.

M&T and its subsidiaries are subject in the normal course of business to various pending and threatened legal proceedings and other matters in which claims for monetary damages are asserted. On an on-going basis management, after consultation with legal counsel, assesses the Company’s liabilities and contingencies in connection with such proceedings. For those matters where it is probable that the Company will incur losses and the amounts of the losses can be reasonably estimated, the Company records an expense and corresponding liability in its consolidated financial statements. To the extent pending or threatened litigation could result in exposure in excess of that liability, the amount of such excess is not currently estimable. Although not considered probable, the range of reasonably possible losses for such matters in the aggregate, beyond the existing recorded liability, was between $0 and $25 million as of ~~June 30, 2023.~~March 31, 2024. Although the Company does not believe that the outcome of pending legal matters will be material to the Company’s consolidated financial position, it cannot rule out the possibility that such outcomes will be material to the consolidated results of operations for a particular reporting period in the future.

~~On May 11,~~In February 2024, the FDIC notified member banks that the loss estimate attributable to certain failed banks in 2023 was approximately $20.4 billion, an increase of approximately $4.1 billion from the ~~Federal Deposit Insurance Corporation (“FDIC”) released a proposed rule~~estimate of $16.3 billion described in the final rule. The FDIC also indicated that ~~would impose a~~through the receivership of one of the failed banks, it had estimated residual interests in securities that were sold into trusts that could potentially reduce that loss estimate in the amount of $1.7 billion. The FDIC is expected to provide an updated estimate of the Company's special assessment amount with its first quarter 2024 invoice, which is anticipated to ~~recover~~be received in June 2024. Reflecting the ~~costs~~update to the ~~deposit insurance fund (“DIF”) resulting from~~loss estimate and related residual interest, the ~~FDIC’s use,~~Company recorded an expense of $29 million in ~~March 2023,~~the Consolidated Statement of Income in the ~~systemic risk exception~~first quarter of 2024 in addition to the ~~least-cost resolution test under~~$197 million recorded in the ~~Federal Deposit Insurance Act~~fourth quarter of 2023, resulting in ~~connection with~~an accrued liability recorded in "accrued interest and other liabilities" in the ~~receiverships~~Company's Consolidated Balance Sheet of ~~Silicon Valley Bank~~$226 million at March 31, 2024 and ~~Signature Bank.~~$197 million at December 31, 2023. The FDIC ~~stated that it currently estimates those assessed losses to total $15.8~~ ~~billion and~~has indicated that the amount of the special ~~assessments would~~assessment will be adjusted as ~~the~~its loss estimate changes. Under the proposed rule, the assessment base would be the estimated uninsured deposits that an insured depository institution (“IDI”) reported in its Consolidated Reports of Condition and Income ("Call Report") at December 31, 2022, excluding the first $estimates change.5

~~16. Recent accounting developments~~

The following table provides a description of accounting standards that were adopted by the Company in 2023 as well as standards that are not effective that could have an impact to M&T’s consolidated financial statements upon adoption.


~~Standard~~	~~Description~~	~~Required date~~ ~~of adoption~~	~~Effect on consolidated financial statements~~
~~Standards Adopted in 2023~~
~~Accounting for Contract Assets and Contract Liabilities from Contracts with Customers in a Business Combination~~	The amendments require that an entity (acquirer) recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with specified revenue recognition guidance. At the acquisition date, an acquirer should account for the related revenue contracts as if it had originated the contracts and may assess how the acquiree applied the revenue guidance to determine what to record for such contracts. The guidance is generally expected to result in an acquirer recognizing and measuring the acquired contract assets and contract liabilities consistent with how they were recognized and measured in the acquiree’s financial statements.	~~January 1, 2023~~	The Company adopted the amended guidance effective January 1, 2023 using a prospective transition method and the guidance will be applied, as applicable, to future acquisitions. The Company does not expect the guidance will have a material impact on its consolidated financial statements.
~~Fair Value Hedging of Multiple Hedge Layers under Portfolio Layer Method~~	The amendments allow multiple hedged layers to be designated for a single closed portfolio of financial assets or one or more beneficial interests secured by a portfolio of financial instruments. If multiple hedged layers are designated, the amendments require an analysis to be performed to support the expectation that the aggregate amount of the hedged layers is anticipated to be outstanding for the designated hedge periods. Only closed portfolios may be hedged under the portfolio layer method (that is, no assets can be added to the closed portfolio once established), however designating new hedging relationships and dedesignating existing hedging relationships associated with the closed portfolio any time after the closed portfolio is established is permitted.	~~January 1, 2023~~	~~At January 1, 2023 the Company did not have any designated hedging relationships under the portfolio layer method and, therefore, the adoption had no impact on its consolidated financial statements.~~
~~Accounting for Troubled Debt Restructurings (TDRs) and Expansion of Vintage Disclosures Applicable to Credit Losses~~	The amendments (1) eliminate the accounting guidance for TDRs and require enhanced disclosure for certain loan refinancings by creditors when a borrower is experiencing financial difficulty and (2) require disclosure of current-period gross write-offs by year of origination for financing receivables and net investments in leases within credit loss disclosures.	~~January 1, 2023~~	The Company adopted the amended guidance effective January 1, 2023 using a prospective transition method and will no longer be required to identify TDRs and apply specialized accounting to such loans. The Company has complied with the modified disclosure requirements in note 4.

~~- 48 -~~

~~NOTES TO FINANCIAL STATEMENTS, CONTINUED~~

~~16. Recent accounting developments, continued~~


~~Standard~~	~~Description~~	~~Required date~~ ~~of adoption~~	~~Effect on consolidated financial statements~~
~~Standards Not Yet Adopted as of June 30, 2023~~
~~Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions~~	The amendments clarify that a contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity security and, therefore, is not considered in measuring fair value. The amendments also clarify that an entity cannot, as a separate unit of account, recognize and measure a contractual sale restriction. In addition, the amendments require the following disclosures for equity securities subject to contractual sale restrictions: ~~1. The fair value of equity securities subject to contractual sale restrictions reflected in the balance sheet;~~ ~~2. The nature and remaining duration of the restriction(s); and~~ ~~3. The circumstances that could cause a lapse in the restriction(s).~~	~~January 1, 2024~~ ~~Early adoption permitted~~	~~The amendments should be applied prospectively with any adjustments from the adoption of the amendments recognized in earnings and disclosed on the date of adoption.~~ ~~The Company does not expect the guidance will have a material impact on its consolidated financial statements.~~
~~Accounting for Investments in Tax Credit Structures Using the Proportional Amortization Method~~	The amendments permit an election to account for tax equity investments, regardless of the tax credit program from which the income tax credits are received, using the proportional amortization method if certain conditions are met. Under the proportional amortization method, the initial cost of the investment is amortized in proportion to the income tax credits and other income tax benefits received and the net amortization and income tax credits and other income tax benefits are recognized in the income statement as a component of income tax expense (benefit). ~~All of the following conditions must be met to qualify for the proportional amortization method:~~ ~~1. It is probable that the income tax credits allocable to the tax equity investor will be available.~~ ~~2. The tax equity investor does not have the ability to exercise significant influence over the operating and financial policies of the underlying project.~~ 3. Substantially all of the projected benefits are from income tax credits and other income tax benefits. Projected benefits include income tax credits, other income tax benefits, and other non-income-tax-related benefits. The projected benefits are determined on a discounted basis, using a discount rate that is consistent with the cash flow assumptions used by the tax equity investor in making its decision to invest in the project. ~~4. The tax equity investor’s projected yield based solely on the cash flows from the income tax credits and other income tax benefits is positive.~~ 5. The tax equity investor is a limited liability investor in the limited liability entity for both legal and tax purposes, and the tax equity investor’s liability is limited to its capital investment. To apply the proportional amortization method, an accounting policy election must be made on a tax-credit-program-by-tax-credit-program basis rather than electing to apply the proportional amortization method at the reporting entity level or to individual investments. When applying the proportional amortization method to qualifying tax equity investments the receipt of the investment tax credits must be accounted for using the flow-through method as prescribed by GAAP, even if the deferral method is applied to other investment tax credits received. In addition, all tax equity investments accounted for using the proportional amortization method must use the delayed equity contribution guidance (which requires that a liability be recognized for delayed equity contributions that are unconditional and legally binding or for equity contributions that are contingent upon a future event when that contingent event becomes probable).	~~January 1, 2024~~ ~~Early adoption permitted~~	~~The amendments should be applied on either a modified retrospective or a retrospective basis.~~ Under a modified retrospective transition, all investments for which income tax credits or other income tax benefits are still expected to be received must be evaluated as of the beginning of the period of adoption. The assessment of whether the investment qualifies for the proportional amortization method is performed as of the date the investment was entered into. A cumulative-effect adjustment reflecting the difference between the previous method used to account for the tax equity investment and the application of the proportional amortization method since the investment was entered into is recognized in the opening balance of retained earnings as of the beginning of the period of adoption. Under a retrospective transition, all investments for which income tax credits or other income tax benefits are still expected to be received must be evaluated as of the beginning of the earliest period presented. The assessment of whether the investment qualifies for the proportional amortization method is performed as of the date the investment was entered into. A cumulative-effect adjustment reflecting the difference between the previous method used to account for the tax equity investment and the application of the proportional amortization method since the investment was entered into is recognized in the opening balance of retained earnings as of the beginning of the earliest period presented. ~~The Company is evaluating whether to early adopt the guidance as well as the impact that the guidance will have on its consolidated financial statements.~~

~~- 49 -~~

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

This Management's Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with the consolidated financial statements and other information included in this Quarterly Report on Form 10-Q as well as with M&T's 2023 Annual Report. Information regarding the Company's business, its supervision and regulation and potential risks and uncertainties that may affect the Company's business, financial condition, liquidity and results of operations are also included in M&T's 2023 Annual Report.

As described in note 1 of Notes to Financial Statements in M&T's 2023 Annual Report, certain financial reporting changes became effective in the fourth quarter of 2023. Prior periods have been presented in conformity with the new classifications.

Overview

The Company's results of operations for the first quarter of 2024 reflect an elevated interest rate environment which has led to higher costs of interest-bearing liabilities that have modestly outpaced increased yields on the Company's earning assets and an elevated level of provision for credit losses. The FOMC hiked its federal funds target rate four times in the first three quarters of 2023, totaling 100 basis points, but has not adjusted that rate since. Included in each of the first quarters of 2024 and 2023 results were seasonal salaries and employee benefits expenses of $99 million. Results for the first quarter of 2024 also included a $29 million estimated increase in the Company's FDIC special assessment. In the fourth quarter of 2023, an estimate of the FDIC special assessment for M&T ~~Bank Corporation (“M&T”)~~of $197 million was recorded in the Consolidated Statement of Income. Additional information about the FDIC special assessment is included in note 13 of Notes to Financial Statements. A summary of financial results for the Company is provided below:

SUMMARY OF FINANCIAL RESULTS


	Three Months Ended						Change						Three Months Ended						Change
(Dollars in millions, except per share)	March 31, 2024			December 31, 2023			Amount			%			March 31, 2024			March 31, 2023			Amount			%
Net interest income	$	1,680		$	1,722		$	(42	)		-2	%	$	1,680		$	1,818		$	(138	)		-8	%
Taxable-equivalent adjustment (a)		12			13			(1	)		-2			12			14			(2	)		-6
Net interest income (taxable-equivalent basis) (a)		1,692			1,735			(43	)		-2			1,692			1,832			(140	)		-8
Provision for credit losses		200			225			(25	)		-11			200			120			80			67
Other income		580			578			2			—			580			587			(7	)		-1
Other expense		1,396			1,450			(54	)		-4			1,396			1,359			37			3
Net income		531			482			49			10			531			702			(171	)		-24
Per common share data:
Basic earnings		3.04			2.75			0.29			11			3.04			4.03			(0.99	)		-25
Diluted earnings		3.02			2.74			0.28			10			3.02			4.01			(0.99	)		-25
Performance ratios, annualized
Return on:
Average assets		1.01	%		.92	%								1.01	%		1.40	%
Average common shareholders’ equity	8.14			7.41									8.14			11.74
Net interest margin	3.52			3.61									3.52			4.04

(a)

Net interest income data are presented on a taxable-equivalent basis which is a non-GAAP measure. The taxable-equivalent adjustment represents additional income taxes that would be due if all interest income were subject to income taxes. This adjustment, which is related to interest received on qualified municipal securities, industrial revenue financings and ~~its consolidated subsidiaries ("the Company") recorded~~preferred equity securities, is based on a composite income tax rate of approximately 25%.

The increase in net income in the recent quarter as compared with the fourth quarter of ~~$867~~2023 resulted from the following:

•

Net interest income on a taxable-equivalent basis declined $43 million reflecting a narrowing of the net interest margin by 9 basis points.

•

Provision for credit losses declined $25 million reflecting a modest improvement in economic forecasts, partially offset by an increase in criticized commercial and industrial loans.

•

Other expenses declined $54 million reflecting a $29 million FDIC assessment in the recent quarter as compared with $197 million in the ~~second~~fourth quarter of 2023, ~~compared with $218 million~~partially offset by seasonally higher salaries and employee benefits expenses.

- 39 -

The decrease in ~~the corresponding quarter of 2022 and $702 million~~net income in the first quarter of ~~2023. Diluted and basic earnings per common share were $5.05 and $5.07, respectively, in~~2024 as compared with 2023's initial quarter reflects the ~~recent quarter, $1.08 each in the second quarter of 2022 and $4.01 and $4.03, respectively,~~following:

•

Taxable-equivalent net interest income in the first quarter of ~~2023. For~~2024 declined $140 million, or 8%, when compared with the first ~~six months~~quarter of 2023, reflecting a narrowing of the net income totaled $1.57 billion or $9.06 and $9.09 of diluted and basic earnings per common share, respectively, compared with $580 million or $3.45 and $3.47 of diluted and basic earnings per common share, respectively, in the similar 2022 period. interest margin by 52 basis points.

•

The after-tax impact of merger-related expenses associated with M&T's acquisition of People's United Financial, Inc. ("People's United") for the three-month and six-month periods ended June 30, 2022 was $346 million ($465 million pre-tax) or $1.94 of diluted earnings per common share and $359 million ($482 million pre-tax) or $2.33 of diluted earnings per common share, respectively. Merger-related expenses incurred in 2022 and associated with the People's United acquisition generally consisted of professional services, temporary help fees and other costs associated with actual or planned conversions of systems and/or integration of operations and the introduction of M&T to its new customers, costs related to terminations of existing contractual arrangements to purchase various services, severance, travel costs, and, in the second quarter of 2022, an initialcomparatively higher provision for credit losses onin the recent quarter as compared with the first quarter of 2023 reflects declines in commercial real estate values and higher interest rates contributing to a deterioration in the performance of loans ~~not deemed~~ to ~~be purchased credit deteriorated ("PCD") on~~commercial borrowers, including nonautomotive finance dealers and healthcare facilities, and growth in loans to certain sectors of the ~~April 1, 2022 acquisition date of People's United. The Company did not incur any merger-related expenses~~Company's commercial and industrial and consumer loan portfolios.

•

Noninterest income in the first ~~or second quarters~~quarter of ~~2023.~~

~~Net income expressed~~2024 declined $7 million as ~~an annualized rate of return on average total assets for the Company in 2023's second quarter was 1.70%,~~ compared with ~~0.42%~~2023's initial quarter. Lower trust income reflecting the CIT divestiture in April 2023 was partially offset by higher mortgage banking revenues and an increase in service charges on commercial deposit accounts.

•

Noninterest expenses, excluding the increased FDIC special assessment, rose modestly from 2023's initial quarter. Higher levels of salaries and employee benefits expense, outside data processing and software expense and other costs of operations were partially offset by lower professional and other services, reflecting the CIT divestiture, and lower advertising and marketing costs.

The Company's effective tax rate was 20.0% in the ~~year-earlier~~first quarter of 2024, compared with 22.9% in the fourth quarter of 2023 and ~~1.40%~~24.2% in the first quarter of 2023. The ~~annualized rate of return on average common shareholders’ equity was 14.27% in the recent quarter, compared with 3.21% in the second quarter of 2022 and 11.74% in the~~ first quarter of ~~2023. During~~2024 income tax expense reflects a net discrete benefit related to the ~~six-month period ended June 30, 2023, the annualized rates~~resolution of ~~return on average assets and average common shareholders' equity were 1.55% and 13.02%, respectively, compared with .65% and 5.34%, respectively, in the first six months of 2022.~~

~~On April 1, 2022, M&T closed~~a tax matter inherited from the acquisition of People's United resulting in the issuance of 50,325,004 common shares. Pursuant to the terms of the merger agreement, People’s United shareholders received consideration valued at .118 of an M&T common share in exchange for each common share of People’s United. The purchase price totaled approximately $8.4 billion (with the price based on M&T’s closing price of $164.66 per share as of April 1, 2022). Additionally, People’s United outstanding preferred stock was converted into new shares of Series H Preferred Stock of M&T.

The People's United transaction has been accounted for using the acquisition method of accounting and, accordingly, assets acquired, liabilities assumed, and consideration exchanged were recorded at estimated fair value on the acquisition date. The Company recorded assets acquired of $64.2 billion, including $35.8 billion of loans and leases and $11.6 billion of investment securities, and liabilities assumed totaling $55.5 billion, including $53.0 billion of deposits. The transaction added $8.4 billion to M&T's common shareholders' equity and $261 million to preferred equity. In connection with the acquisition the Company recorded $3.9 billion of goodwill and $261 million of core deposit and other intangible assets. The acquisition of People's United formed a banking franchise with approximately $200 billion in assets serving communities in the Northeast and Mid-Atlantic from Maine to Virginia, including Washington, D.C.

In April 2023 M&T completed the divestiture of its Collective Investment Trust ("CIT") business to a private equity firm. The sale of this business resulted in a pre-tax gain of $225 million ($157 million after tax, or $0.94 of diluted earnings per common share) in the second quarter of 2023 results of operations. Prior to the sale, the operations of that business did not have a material impact on M&T's net income.

M&T repurchased 3,505,946 shares of its common stock at an average cost per share of $171.14 resulting in a total cost of $600 million in 2022's second quarter and 3,838,157 shares at an average cost per share of

~~- 50 -~~

~~$154.76 resulting in a total cost, including the share repurchase excise tax, of $600 million in the first quarter of 2023. No share repurchases occurred in the second quarter of 2023.~~

Supplemental Reporting of Non-GAAP Results of Operations

M&T consistently provides supplemental reporting of its results on a “net operating” or “tangible” basis, from which M&T excludes the after-tax effect of amortization of core deposit and other intangible assets (and the related goodwill, core deposit intangible and other intangible asset balances, net of applicable deferred tax amounts) and gains (when realized) and expenses (when incurred) associated with merging acquired operations into the Company, since such items are considered by management to be “nonoperating” in nature. Although “net operating income” as defined by M&T is not a GAAP measure, M&T’s management believes that this information helps investors understand the effect of acquisition activity in reported results.

~~Net~~SUPPLEMENTAL REPORTING OF NON-GAAP RESULTS OF OPERATIONS


	Three Months Ended						Change					Three Months Ended						Change
(Dollars in millions, except per share data)	March 31, 2024			December 31, 2023			Amount		%			March 31, 2024			March 31, 2023			Amount			%
Net operating income	$	543		$	494		$	49		10	%	$	543		$	715		$	(172	)		-24	%
Diluted net operating earnings per share		3.09			2.81			0.28		10			3.09			4.09			(1.00	)		-24
Return on:
Average tangible assets		1.08	%		.98	%							1.08	%		1.49	%
Average tangible common equity		12.67			11.70								12.67			19.00
Efficiency ratio		60.8			62.1								60.8			55.5
Tangible equity per common share (a)	$	99.54		$	98.54		$	1.00		1	%	$	99.54		$	88.81		$	10.73			12	%

(a)

At the period end.

The efficiency ratio measures the relationship of noninterest operating ~~income aggregated $879 million~~expenses, which exclude expenses M&T considers to be "nonoperating" in nature consisting of amortization of core deposit and other intangible assets and merger-related expenses, to revenues. The calculations of the ~~second quarter~~Company’s efficiency ratio, or noninterest operating expenses divided by the sum of ~~2023, compared with $578 million in the year-earlier quarter. Diluted~~taxable-equivalent net ~~operating earnings per common share in the recent quarter and the corresponding 2022 quarter were $5.12 and $3.10, respectively. Net operating~~interest income and ~~diluted net operating earnings per common share were $715 million~~noninterest income (exclusive of gains and ~~$4.09, respectively, in the first quarter of 2023. For the first six months of 2023, net operating income~~losses from bank investment securities), and ~~diluted net operating earnings per common share were $1.59 billion and $9.21, respectively, compared with $954 million and $5.88, respectively, in the first half of 2022.~~

Expressed as an annualized rate of return on average tangible assets, net operating income in the recent quarter was 1.80%, compared with 1.16% in the second quarter of 2022 and 1.49% in 2023’s first quarter.Net operating income represented an annualized return on average tangible common equity of 22.73% in the second quarter of 2023, 14.41% in the year-earlier quarter and 19.00% in the first quarter of 2023. For the first half of 2023, net operating income represented an annualized return on average tangible assets and average tangible common shareholders' equity of 1.65% and 20.90%, respectively, compared with 1.11% and 13.57%, respectively, in the corresponding 2022 period.

~~Reconciliations~~reconciliations of GAAP amounts with corresponding non-GAAP amounts are ~~provided~~presented in ~~table~~Table 2.

- 40 -

Taxable-equivalent Net Interest Income

~~Net~~Interest income earned on certain of the Company's assets is exempt from federal income tax. Taxable-equivalent net interest income ~~expressed~~is a non-GAAP measure that adjusts income earned on a tax-exempt asset to present it on an equivalent basis to interest income earned on a fully taxable asset. The Company's average balance sheets accompanied by the annualized taxable-equivalent interest income and expense and the average rate on the Company's earning assets and interest-bearing liabilities are presented as follows.

AVERAGE BALANCE SHEETS AND ANNUALIZED TAXABLE-EQUIVALENT RATES


	2024 First Quarter								2023 Fourth Quarter								2023 Third Quarter
(Dollars in millions)	Average Balance			Interest		Average Rate			Average Balance			Interest		Average Rate			Average Balance			Interest		Average Rate
Assets
Earning assets:
Loans and leases, net of unearned discount (a):
Commercial and industrial	$	56,821		$	987		6.99	%	$	55,420		$	979		7.01	%	$	54,567		$	943		6.86	%
Commercial real estate		32,696			526		6.36			33,455			560		6.54			34,288			570		6.50
Residential real estate		23,136			247		4.28			23,339			248		4.25			23,573			244		4.14
Consumer		21,143			343		6.54			20,556			332		6.42			20,189			313		6.16
Total loans and leases, net		133,796			2,103		6.32			132,770			2,119		6.33			132,617			2,070		6.19
Interest-bearing deposits at banks		30,647			419		5.49			30,153			416		5.48			26,657			363		5.40
Trading account		105			1		3.42			123			1		3.80			136			1		4.05
Investment securities (b):
U.S. Treasury and federal agencies		24,625			191		3.11			23,675			173		2.90			24,166			177		2.90
Obligations of states and political subdivisions		2,489			23		3.77			2,507			24		3.75			2,527			24		3.70
Other		1,473			20		5.54			1,308			20		6.04			1,300			21		6.51
Total investment securities		28,587			234		3.30			27,490			217		3.13			27,993			222		3.14
Total earning assets		193,135			2,757		5.74			190,536			2,753		5.73			187,403			2,656		5.62
Allowance for credit losses		(2,156	)							(2,073	)							(1,998	)
Cash and due from banks		1,687								1,634								1,730
Other assets		18,812								18,655								18,656
Total assets	$	211,478							$	208,752							$	205,791
Liabilities and shareholders’ equity
Interest-bearing liabilities:
Interest-bearing deposits:
Savings and interest-checking deposits	$	94,867		$	615		2.61	%	$	93,365		$	606		2.58	%	$	89,274		$	494		2.20	%
Time deposits		20,583			225		4.41			21,224			230		4.30			19,528			202		4.09
Total interest-bearing deposits		115,450			840		2.93			114,589			836		2.90			108,802			696		2.54
Short-term borrowings		6,228			84		5.42			5,156			69		5.27			5,346			69		5.16
Long-term borrowings		9,773			141		5.81			7,901			113		5.70			7,240			101		5.52
Total interest-bearing liabilities		131,451			1,065		3.26			127,646			1,018		3.17			121,388			866		2.83
Noninterest-bearing deposits		48,615								50,124								53,886
Other liabilities		4,393								4,482								4,497
Total liabilities		184,459								182,252								179,771
Shareholders’ equity		27,019								26,500								26,020
Total liabilities and shareholders’ equity	$	211,478							$	208,752							$	205,791
Net interest spread							2.48								2.56								2.79
Contribution of interest-free funds							1.04								1.05								1.00
Net interest income/margin on earning assets				$	1,692		3.52	%				$	1,735		3.61	%				$	1,790		3.79	%

(a)

Includes nonaccrual loans.

(b)

Includes available-for-sale securities at amortized cost.

- 41 -

AVERAGE BALANCE SHEETS AND ANNUALIZED TAXABLE-EQUIVALENT RATES (continued)


	2023 Second Quarter								2023 First Quarter
(Dollars in millions)	Average Balance			Interest		Average Rate			Average Balance			Interest		Average Rate
Assets
Earning assets:
Loans and leases, net of unearned discount (a):
Commercial and industrial	$	54,572		$	901		6.63	%	$	52,510		$	816		6.30	%
Commercial real estate		34,903			563		6.38			35,245			519		5.89
Residential real estate		23,781			244		4.10			23,770			235		3.96
Consumer		20,289			298		5.88			20,487			287		5.67
Total loans and leases, net		133,545			2,006		6.02			132,012			1,857		5.70
Interest-bearing deposits at banks		23,617			302		5.14			24,312			277		4.64
Trading account		151			1		2.66			123			1		2.32
Investment securities (b):
U.S. Treasury and federal agencies		24,630			179		2.92			23,795			167		2.85
Obligations of states and political subdivisions		2,555			24		3.71			2,570			24		3.75
Other		1,438			18		4.83			1,257			15		4.38
Total investment securities		28,623			221		3.09			27,622			206		3.00
Total earning assets		185,936			2,530		5.46			184,069			2,341		5.16
Allowance for credit losses		(1,985	)							(1,938	)
Cash and due from banks		1,747								1,952
Other assets		18,678								18,516
Total assets	$	204,376							$	202,599
Liabilities and shareholders’ equity
Interest-bearing liabilities:
Interest-bearing deposits:
Savings and interest-checking deposits	$	87,210		$	369		1.69	%	$	88,053		$	277		1.28	%
Time deposits		16,009			150		3.77			11,630			89		3.11
Total interest-bearing deposits		103,219			519		2.02			99,683			366		1.49
Short-term borrowings		7,539			96		5.11			4,994			58		4.69
Long-term borrowings		7,516			102		5.43			6,511			85		5.27
Total interest-bearing liabilities		118,274			717		2.43			111,188			509		1.86
Noninterest-bearing deposits		56,180								61,854
Other liabilities		4,237								4,180
Total liabilities		178,691								177,222
Shareholders’ equity		25,685								25,377
Total liabilities and shareholders’ equity	$	204,376							$	202,599
Net interest spread							3.03								3.30
Contribution of interest-free funds							.88								.74
Net interest income/margin on earning assets				$	1,813		3.91	%				$	1,832		4.04	%

(a)

Includes nonaccrual loans.

(b)

Includes available-for-sale securities at amortized cost.

Expressed on a taxable-equivalent basis net interest income was ~~$1.81~~$1.69 billion in the ~~second~~first quarter of 2024, compared with $1.74 billion and $1.83 billion, respectively, in the fourth and first quarters of 2023. The decrease in net interest income in the recent quarter reflects a 9 basis point reduction from the fourth quarter of 2023 ~~increased~~and a 52 basis point reduction from ~~$1.42 billion recorded in~~ the year-earlier ~~quarter. That increase reflects a 90 basis point (hundredths of one percent) expansion~~quarter of the net interest margin, or taxable-equivalent net interest income expressed as an annualized percentage of average earning assets, to ~~3.91%~~3.52% in the recent ~~quarter from 3.01% in the year-earlier~~ quarter. The ~~increased~~lower net interest margin was influenced by a rising interest rate environment resulting from actions taken by the Federal Reserve to mitigate inflationary pressures on the U.S. economy. The Federal Reserve raised its target Federal funds rate through multiple hikes totaling 5.0% from March 2022 through June 2023, which led to higher yields on loans, deposits at the Federal Reserve Bank ("FRB") of New York and investment securities, partially offset by higher rates paid on interest-bearing deposits and borrowings. Taxable-equivalent net interest income in the recent quarter declined slightly from $1.83 billion in the first quarter of ~~2023. That decrease~~2024 compared with the fourth and first quarters of 2023 predominantly reflects a ~~13 basis point narrowing of~~comparatively higher interest rate environment, which has resulted in increases in rates paid on interest-bearing deposit products and borrowings outpacing increases in yields on the ~~net~~Company's interest-earning assets. Although the FOMC has not raised its federal funds target rate since July 2023, interest ~~margin~~rates have remained elevated and the Company has experienced increased competition for customer deposits in the marketplace and a $7.1 billion increase in interest-bearing liabilities to $118.3 billion, compared with $111.2 billion in the initial 2023 quarter, partially offset by a $1.9 billion increase in average earning assets to $185.9 billion in the recent quarter from $184.1 billion in 2023's first quarter. The net interest margin was 4.04% in the first quarter of 2023.

For the first six months of 2023, taxable-equivalent net interest income was $3.64 billion, up from $2.33 billion recognized in the corresponding 2022 period. The increase was primarily attributable to the higher level of average earning assets and a 111 basis point expansion of the net interest margin to 3.97% in the 2023 period from 2.86% in the year-earlier period, partially offset by an increase in average interest-bearing liabilities. The increase in average earning assets in the first half of 2023 includes the impact of one additional quarter from earning assets obtained in the People's United transaction on April 1, 2022, commercial loan growth and purchases of investment securities, partially offset by lower deposits at the FRB of New York. The increase in average interest-bearing liabilities reflects interest-bearing liabilities assumed in the People's United acquisition and a continuedmix shift in ~~customer~~those deposits toward higher cost interest-bearing products, including time deposits. The Company has also altered its use of other funding sources including borrowings and placement of brokered deposits. Average short-term and long-term borrowings in the recent quarter collectively rose by $2.9 billion, or 23%, while average brokered deposits decreased $736 million, or 5%, from the fourth quarter of 2023. As compared with the first quarter of 2023, average short-term and ~~higher~~long-term borrowings collectively rose by $4.5 billion, or 39%, and average ~~borrowings.~~brokered deposits increased $5.2 billion, or 64% in the recent quarter.

- 5142 -

Lending Activities

The following table summarizes average loans and leases outstanding in the first quarter of 2024 and percentage changes in the major components of the portfolio over comparable periods.

AVERAGE LOANS AND LEASES


			Percent Change from
(Dollars in millions)	First Quarter 2024		Fourth Quarter 2023			First Quarter 2023
Commercial and industrial	$	56,821		3	%		8	%
Commercial real estate		32,696		-2			-7
Residential real estate		23,136		-1			-3
Consumer:
Recreational finance		10,306		5			13
Automobile		4,177		6			-6
Home equity lines and loans		4,597		-1			-7
Other		2,063		-2			3
Total consumer		21,143		3			3
Total	$	133,796		1	%		1	%

Average loans and leases totaled ~~$133.5~~$133.8 billion in the ~~second~~first quarter of 2024, up $1.0 billion or 1% from the fourth quarter of 2023.

•

Commercial and industrial loans and leases averaged $56.8 billion in the recent quarter, up $1.4 billion from the fourth quarter of 2023 ~~up $5.9~~reflecting growth which spanned most industry types.

•

Average commercial real estate loans were $32.7 billion in the first quarter of 2024, $759 million lower than the final quarter of 2023 reflecting declines of $296 million in average construction loans and $463 million in average permanent commercial real estate loans.

•

Average residential real estate loans decreased $203 million to $23.1 billion in the first quarter of 2024 as compared with the fourth quarter of 2023, largely attributable to customer payments on loans held for investment.

•

Consumer loans averaged $21.1 billion in the first quarter of 2024 or $587 million higher than the fourth quarter of 2023. That growth reflected an increase in average balances of $452 million and $247 million in M&T's portfolio of recreational finance loans and automobile loans, respectively.

Average loans and leases increased $1.8 billion or 5%1% from ~~$127.6~~$132.0 billion in the similar quarter of ~~2022. Commercial~~2023.

•

Average commercial and industrial loans and leases ~~averaged $44.5~~increased $4.3 billion ~~in the recent quarter, up $6.7 billion or 18%~~ from ~~$37.8 billion in~~ the year-earlier ~~quarter. That increase~~quarter predominantly ~~reflects~~reflecting growth in loans to financial and insurance industry customers and ~~loans~~ to ~~motor-vehicle~~motor vehicle and recreational finance dealers, partially offset by a reduction in average balances of Paycheck Protection Program ("PPP") loans reflecting loan repayments by the Small Business Administration. PPP loans averaged $86 million in the second quarter of 2023, compared with $545 million in the second quarter of 2022. dealers.

•

Average commercial real estate loans decreased ~~$2.3 billion or 5% to $44.9~~$2.5 billion in the ~~second~~recent quarter as compared with the first quarter of 2023 ~~from $47.2 billion in the year-earlier quarter. That decrease reflects declines~~reflecting decreases of ~~$1.7~~$1.0 billion in average construction loans and ~~$570 million~~$1.5 billion in average permanent commercial real estate loans.

•

Average residential real estate loans ~~increased $1.0 billion or 4% to $23.8 billion~~decreased $634 million in the ~~second~~first quarter of 2024 from the year-earlier quarter. That decrease was largely attributable to customer payments on loans held for investment. In the first quarter of 2023, ~~from $22.8 billion in~~ the ~~year-earlier quarter. Throughout 2022, M&T retained rather than sold most originated residential mortgage loans. M&T~~Company returned to originating for sale the majority of its newly ~~committed~~originated residential mortgage loans.

•

Average consumer loans in the first quarter of ~~2023. Consumer loans averaged $20.3 billion in the second quarter of 2023, up $496~~2024 increased $656 million ~~or 3%~~ from ~~$19.8 billion in~~ the year-earlier quarter. That growth reflected a higher average ~~balance~~balances of ~~$884 million in M&T's portfolio~~$1.2 billion of recreational finance loans, partially offset by ~~a decline~~declines of ~~$425~~$252 million and $332 million in average balances of automobile ~~loans.~~

Average loan and lease balances in the second quarter of 2023 increased $1.5 billion from $132.0 billion in the first quarter of 2023. The higher balances resulted predominantly from growth in commercial loans and leases which increased $2.1 billion from $42.4 billion in the first quarter of 2023 and reflected higher balances of loans to financial and insurance industry customers and motor vehicle and recreational finance dealers. Average commercial real estate loans in the second quarter of 2023 declined $383 million from $45.3 billion in the first quarter of 2023. Average balances of residential real estate loans in the recently completed quarter were essentially unchanged from 2023’s first quarter. Average consumer loans in the recent quarter decreased $199 million from $20.5 billion in the first quarter of 2023. The accompanying table summarizes quarterly changes in the major components of the loan and lease portfolio.

~~AVERAGE LOANS AND LEASES~~

~~(net of unearned discount)~~

Percent Increase

(Decrease) from

2nd Qtr.

2nd Qtr.

1st Qtr.

2023

2022

2023

(In millions)

Commercial, financial, etc.

$
44,531

18

%

5

%
Real estate — commercial

44,944

(5
)

(1
)

Real estate — consumer

23,781

4

—

Consumer

Recreational finance

9,207

11

1

Automobile

4,189

(9
)

(5
)

Home equity lines and loans

4,818

(4
)

(2
)

Other

2,075

14

4

Total consumer

20,289

3

(1
)

Total

$
133,545

5

%

1

%

~~For the first six months of 2023, average~~home equity loans and leases totaled $132.8 billion, up 21%, from $110.0 billion in the corresponding 2022 period. Loans obtained in the People's United acquisition and commercial loan growth were the predominant factors for that increase, partially offset by declining average balanceslines of ~~commercial real estate loans and average balances of PPP loans. PPP loans averaged $95 million and $706 million in the first six months of 2023 and 2022,~~credit, respectively.

- 43 -

Investing Activities

The investment securities portfolio averaged $28.6 billion in the ~~second quarter of 2023, up $6.2 billion from $22.4 billion in the year-earlier quarter and $1.0 billion higher than the $27.6 billion averaged in the~~ first quarter of ~~2023.~~2024, up $1.1 billion and $965 million from the fourth and first quarters of 2023, respectively. The higher average balance in the ~~second~~recent quarter when compared with the fourth quarter of 2023 ~~when compared with the~~and year-earlier quarter reflects the purchase of ~~$7.0~~$4.1 billion of ~~investment~~debt securities during the ~~twelve-month~~three-month period ended ~~June 30, 2023.~~March 31, 2024. Those

~~- 52 -~~

purchases were predominantly U.S. Treasury notes and fixed rate government issued or guaranteed mortgage-backed securities. When compared with the first quarter of 2023 the increase relates to a full quarter's impact of the purchases of approximately $3.3 billion of investment securities during that first quarter. Those purchases consisted predominantly of fixed rate mortgage-backed securities. For the first six months of 2023 and 2022, investment securities averaged $28.1 billion and $15.1 billion, respectively. In addition to the purchases described herein, $11.6 billion of investment securities obtained in the acquisition of People's United on April 1, 2022 contributed to the increase in average investment securities during the first half of 2023 as compared with the first half of 2022. There were no significant sales of investment securities during the ~~six~~three months ended ~~June 30,~~March 31, 2024, December 31, 2023 and ~~2022.~~March 31, 2023. The Company routinely ~~has~~ increases and decreases in its holdings of capital stock of the ~~Federal Home Loan Bank (“FHLB”)~~FHLB of New York and the FRB of New ~~York. Those holdings are accounted for at cost and are adjusted~~York based on amounts of outstanding borrowings and available lines of credit with those entities.

The investment securities portfolio is largely comprised of government issued or guaranteed residential mortgage-backed securities and shorter-term U.S. Treasury and federal agency notes, but also includes ~~municipal~~commercial mortgage-backed securities and ~~commercial real estate mortgage-backed~~municipal securities. When purchasing investment securities, the Company considers its liquidity position and its overall ~~interest-rate~~interest rate risk profile as well as the adequacy of expected returns relative to risks assumed, including prepayments. The Company may occasionally sell investment securities as a result of movements in interest rates and spreads, changes in liquidity needs, actual or anticipated prepayments, credit risk associated with a particular security, or as a result of restructuring its investment securities portfolio in connection with a business combination. The amounts of investment securities held by the Company are influenced by such factors as available yield in comparison with alternative investments, demand for loans, which generally yield more than investment securities, ongoing repayments, the levels of deposits, and management of liquidity and balance sheet size and resulting capital ratios.

Fair value changes in equity securities with readily determinable fair values are recognized in the Consolidated Statement of Income. Net unrealized gains and losses on such equity securities were not significant in each of the first six months of 2023 and 2022.

The Company regularly reviews its debt investment securities for declines in value below amortized cost that might be indicative of credit-related losses. In light of such reviews, there were no credit-related losses on debt investment securities recognized in ~~either~~any of the ~~six~~three months ended ~~June 30,~~March 31, 2024, December 31, 2023 ~~or 2022. Based on management’s assessment~~and March 31, 2023. A further discussion of ~~future cash flows associated with individual~~fair values of investment securities ~~as of June 30, 2023,~~is included herein under the ~~Company did not expect to incur any material credit-related losses in its portfolios of debt investment securities.~~heading "Capital." Additional information about the investment securities portfolio is included in notes 3 and 12 of Notes to Financial Statements.

Other earning assets include interest-bearing deposits at banks, trading account assets, federal funds sold and agreements to resell securities. Those other earning assets in the aggregate averaged ~~$23.8~~$30.8 billion in the recently completed quarter, compared with ~~$39.8~~$30.3 billion ~~in the year-earlier quarter~~ and $24.4 billion induring the ~~first quarter of 2023.~~three months ended December 31, 2023 and March 31, 2023, respectively. Interest-bearing deposits at banks averaged ~~$23.6~~$30.6 billion, ~~$39.4~~$30.2 billion and $24.3 billion during the three months ended ~~June 30,~~March 31, 2024, December 31, 2023 ~~June 30, 2022~~ and March 31, 2023, respectively. The amounts of interest-bearing deposits at banks at those respective dates were predominantly comprised of deposits held at the FRB of New York. In general, the ~~amount~~levels of those deposits ~~held at the FRB of New York fluctuates~~often fluctuate due to changes in ~~levels~~deposits of ~~the Company's investments, loans,~~retail and commercial customers, trust-related deposits and ~~other borrowings. The lower balances in the recent quarter and the first quarter of 2023, compared with the year-earlier quarter reflect loan portfolio growth, the purchases~~additions to or maturities of investment securities ~~and treasury stock and the decline in noninterest bearing deposits, partially offset by the issuance of long-term debt and other short-term borrowings and an increase in time deposits.~~or borrowings.

As a result of the changes described herein, average earning assets totaled $185.9 billion in the most recent quarter, compared with $189.8 billion in the second quarter of 2022 and $184.1 billion in the first quarter of 2023. Average earning assets totaled $185.0 billion and $164.3 billion during the first six months of 2023 and 2022, respectively.Funding Activities - Deposits

The most significant source of funding for the Company is core deposits. The Company considers noninterest-bearing deposits, interest-bearing transaction accounts, savings deposits and time deposits of $250,000 or less as core deposits. The Company’s branch network is its principal source of core deposits, which generally carry lower interest rates than wholesale funds of comparable maturities. Average core deposits totaled ~~$146.8~~$147.4 billion, inor 76% of average earning assets, for the ~~second~~ quarter

~~- 53 -~~

~~of 2023,~~ ended March 31, 2024, compared with ~~$169.6~~$147.6 billion, ~~in the similar 2022 quarter~~or 77%, and $152.0 billion, inor 83%, for the ~~first quarter~~quarters ended December 31, 2023 and March 31, 2023, respectively. The lower level of ~~2023. The decrease in average~~ core deposits in the recent quarter as compared with the year-earlier quarter and 2023's initial quarter was primarily the result of monetary tightening that influenced customers to seek higher rate alternatives, including a shift from operating demand accounts to off-balance sheet sweep accounts for commercial customers. Lower levels of activity in the capital markets also resulted in a reduction of trust demand deposits. The following table provides an analysis of quarterly changes in the components of average core deposits.

~~AVERAGE CORE DEPOSITS~~

Percent Increase

(Decrease) from

2nd Qtr.

2nd Qtr.

1st Qtr.

2023

2022

2023

(In millions)

Savings and interest-checking deposits

$
83,456

(8
)
%

(1
)
%
Time deposits

7,143

53

29

Noninterest-bearing deposits

56,180

(24
)

(9
)

Total

$
146,779

(13
)
%

(3
)
%

The Company also receives funding from other deposit sources, including branch-related time deposits over $250,000 and brokered deposits. Time deposits over $250,000 averaged $2.0 billion in the recent quarter, compared with $808 million in the second quarter of 2022 and $1.5 billion in the first quarter of 2023. The increase in such deposits in the two most recent quarters as compared with the ~~second~~first quarter of ~~2022~~2023 reflects ~~higher demand for~~a shift in the mix of funding sources, including from other deposit sources such as branch-related time ~~deposit products in a rising interest rate environment. The Company had~~deposits over $250,000 and brokered deposits. Brokered savings and interest-bearing transaction accounts ~~that~~and brokered time deposit accounts averaged ~~$3.8~~$8.0 billion ~~during~~and $5.2 billion, respectively, in the recent quarter, ~~$4.2 billion in the year-earlier quarter and $3.4 billion in the first quarter of 2023. Brokered time deposits averaged $6.9 billion in the second quarter of 2023~~ compared with ~~$58 million in the second quarter of 2022~~$6.7 billion and ~~$4.6~~$7.3 billion, ~~in the first quarter of 2023. The increase in such deposits from the second quarter of 2022 was predominantly due to deposits added late~~respectively, in the fourth quarter of ~~2022~~2023 and ~~through~~$3.4 billion and $4.6 billion, respectively, in the ~~second~~first quarter of 2023. Additional brokered deposits may be ~~solicited~~added in the future depending on market conditions, including demand by customers and other investors for those deposits, and the cost of funds available from alternative sources at that time. The following table provides an analysis of quarterly changes in the ~~time. Total uninsured~~components of average deposits.

- 44 -

AVERAGE DEPOSITS


			Percent Change from
(Dollars in millions)	First Quarter 2024		Fourth Quarter 2023			First Quarter 2023
Noninterest-bearing deposits	$	48,615		-3	%		-21	%
Savings and interest-checking deposits		86,837		—			3
Time deposits of $250,000 or less		11,985		11			117
Total core deposits		147,437		—		-3

Time deposits greater than $250,000		3,405		7			130
Brokered deposits		13,223	-5				64
Total deposits	$	164,065		—	%		2	%

Deposits averaged $164.1 billion in the recent quarter, a $648 million decline from $164.7 billion in the fourth quarter of 2023.

•

Average core deposits ~~were estimated~~decreased nominally from the fourth quarter of 2023 reflecting a stabilization of customer deposits in the higher rate environment.

•

The decrease in average brokered deposits in the recent quarter reflected a mix shift in the Company's wholesale funding strategies. Average brokered time deposits decreased $2.1 billion to ~~be $67.0~~$5.2 billion ~~at June 30,~~in the recent quarter from $7.3 billion in the fourth quarter of 2023 and the rates paid on those deposits averaged 5.01% and 4.97%, respectively. Average brokered savings and interest-bearing transaction accounts increased $1.3 billion to $8.0 billion in the recent quarter from $6.7 billion in the fourth quarter of 2023 and the rates paid on those deposits averaged 4.78% and 4.66%, respectively. The rate paid on total non-brokered interest-bearing deposits was 2.67% in the first quarter of 2024, compared with ~~$67.7~~2.62% in the fourth quarter of 2023.

Average deposits increased $2.5 billion ~~at March 31,~~from $161.5 billion in the year-earlier quarter.

•

The decrease in average core deposits in the recent quarter as compared with the year-earlier quarter reflects the impact of an elevated interest rate environment that influenced customers to seek higher rate alternatives, including a shift from noninterest-bearing deposit accounts to commercial sweep products and time deposits over $250,000.

•

The increase in average brokered deposits in the recent quarter as compared with the first quarter of 2023 ~~$74.2 billion at December 31, 2022~~reflects the Company's liquidity management and ~~$79.9 billion at June 30, 2022. Approximately $10.5 billion, $10.7 billion, $11.4~~funding strategies during a period of rising interest rates, partially offset by the maturity of some brokered time deposits in the recent quarter. The Company had brokered savings and interest-bearing transaction accounts and brokered time deposits that averaged $3.4 billion and ~~$13.2~~$4.6 billion, respectively, in the year-earlier quarter and the rates paid on those deposits averaged 3.54% and 4.82%, respectively. The rate paid on total non-brokered interest-bearing deposits in the first quarter of ~~those uninsured deposits were collateralized by the Company at June 30,~~ 2023 ~~March 31, 2023, December 31, 2022 and June 30, 2022 respectively.~~

was 1.24%.

- 5445 -

The accompanying table summarizes the components of average total deposits by segment for the quarters ended ~~June 30, 2023,~~ March 31, 2024, December 31, 2023 and ~~June 30, 2022.~~March 31, 2023.

AVERAGE DEPOSITS BY SEGMENT


	Retail		Trust			Commercial and Other		Total
	(In millions)
Three Months Ended June 30, 2023
(Dollars in millions)										Commercial Bank		Retail Bank		Institutional Services and Wealth Management		All Other		Total
Three Months Ended March 31, 2024
Noninterest-bearing deposits										$	13,459	$	25,380	$	9,081	$	695	$	48,615
Savings and interest-checking deposits	$	43,576	$	6,322		$	37,312	$	87,210		29,721		51,274		7,131		6,741		94,867
Time deposits		8,548		16			7,445		16,009		353		14,995		37		5,198		20,583
Total										$	43,533	$	91,649	$	16,249	$	12,634	$	164,065

Three Months Ended December 31, 2023
Noninterest-bearing deposits		14,579		9,269			32,332		56,180	$	14,527	$	26,474	$	8,477	$	646	$	50,124
Savings and interest-checking deposits											28,702		51,941		6,728		5,994		93,365
Time deposits											425		13,507		31		7,261		21,224
Total	$	66,703	$	15,607		$	77,089	$	159,399	$	43,654	$	91,922	$	15,236	$	13,901	$	164,713

Three Months Ended March 31, 2023
Noninterest-bearing deposits										$	20,206	$	30,552	$	10,363	$	733	$	61,854
Savings and interest-checking deposits	$	45,996	$	7,172		$	34,885	$	88,053		22,263		54,650		7,957		3,183		88,053
Time deposits		6,483		13			5,134		11,630		330		6,667		13		4,620		11,630
Noninterest-bearing deposits		15,071		10,348	��		36,435		61,854
Total	$	67,550	$	17,533		$	76,454	$	161,537	$	42,799	$	91,869	$	18,333	$	8,536	$	161,537

Three Months Ended June 30, 2022
Savings and interest-checking deposits	$	52,750	$	6,852		$	35,547	$	95,149
Time deposits		5,001		17			462		5,480
Noninterest-bearing deposits		14,483		11,691			47,880		74,054
Total	$	72,234	$	18,560		$	83,889	$	174,683

Funding Activities - Borrowings

The following table summarizes the average balances utilized from the Company's short-term and long-term borrowing facilities and note programs.

AVERAGE BORROWINGS


	Three Months Ended
	March 31,		December 31,		March 31,
(Dollars in millions)	2024		2023		2023
Short-term borrowings:
Federal funds purchased and repurchase agreements	$	307	$	404	$	364
FHLB advances		5,921		4,752		4,630
Total short-term borrowings	$	6,228	$	5,156	$	4,994

Long-term borrowings:
Senior notes	$	6,418	$	5,863	$	4,979
FHLB advances		1,323		5		5
Subordinated notes		977		989		980
Junior subordinated debentures		540		539		537
Asset-backed notes		505		495		—
Other		10		10		10
Total long-term borrowings		9,773		7,901		6,511
Total borrowed funds	$	16,001	$	13,057	$	11,505

The Company also uses ~~borrowings~~borrowing capacity from banks, the ~~FHLB of New York,~~FHLBs, the FRB of New York and others as sources of funding. Short-term borrowings represent ~~borrowing~~ arrangements that at the time they were entered into had a contractual maturity of one year or less. ~~Average~~The higher levels of short-term borrowings ~~totaled $7.5 billion in the second quarter of 2023, compared with $1.1 billion in the year-earlier quarter and $5.0 billion~~ in the first quarter of ~~2023. Short-term~~2024 as compared with the fourth quarter of 2023 and year-earlier first quarter reflect the Company's management of liquidity.

Long-term borrowings averaged $9.8 billion, $7.9 billion and $6.5 billion in the three-month periods ending March 31, 2024, December 31, 2023 and March 31, 2023, respectively. In February 2024, M&T Bank advanced $2.0 billion from the FHLB of New York ~~averaged $7.1 billion~~which matures in ~~the second quarter~~February 2025 at a variable rate of 2023 compared with $4.6 billion in the first quarter of 2023 and a nominal amount in the second quarter of 2022. Short-term borrowings assumed in connection with the People's United acquisition totaled $895 million on April 1, 2022.SOFR plus 25 basis points payable quarterly until maturity. In October 2022 M&T redeemed $500 million of unsecured senior notes due to mature in December 2022 that had been assumed in the acquisition of People's United and included in short-term borrowings. In general, the increase in short-term borrowings reflects the Company's liquidity ratio management.

Long-term borrowings averaged $7.5 billion in the second quarter of 2023, compared with $3.3 billion in the year-earlier quarter and $6.5 billion in the first quarter of 2023. As of April 1, 2022, long-term borrowings assumed in the People's United acquisition totaled $494 million and included $483 million of fixed-rate subordinated notes and $11 million of FHLB advances. Average balances of the Company’s outstanding senior notes were $6.0 billion, $1.7 billion and $5.0 billion during the three months ended June 30, 2023, June 30, 2022 and March ~~31, 2023, respectively. In January 2023,~~2024, M&T issued $1.0 billion of senior notes that mature in January 2034 and pay a 5.053% fixed rate semi-annually until January 2033 after which the Secured Overnight Financing Rate ("SOFR") plus 1.85% will be paid quarterly until maturity. Additionally, in January 2023 M&T Bank issued $1.3 billion of senior notes that mature in January 2026 and pay a fixed rate of 4.65% semi-annually until maturity and $1.2 billion of senior notes that mature in January 2028 and pay a fixed rate of 4.70% semi-annually until maturity. In November 2022 M&T Bank issued $500 million of fixed rate senior notes that pay a rate of 5.4% semi-annually and mature in November 2025. In August 2022 M&T issued $500$850 million of senior notes that mature in ~~August 2028~~March 2032 and pay a 6.08% fixed rate ~~of 4.553%~~ semi-annually until ~~August 2027~~March 2031 after which ~~the~~ SOFR plus ~~1.78%~~2.26% will be paid quarterly until maturity. ~~In April 2022,~~Also in March 2024, M&T Bank ~~redeemed $650~~issued $511 million of ~~fixed~~asset-backed notes secured by automobile loans with a weighted-average estimated life of approximately two years and a weighted-average interest rate ~~senior notes that were due~~of 5.29% at the time

- 46 -

of securitization. The increased usage of borrowing facilities reflects the Company's strategies to ~~mature on May 18, 2022. During May 2022, $250 million~~diversify its wholesale funding options to provide long-term funding stabilization and prepare for proposed regulations enumerating certain long-term debt requirements as described in Part I, Item 1 of ~~variable rate senior notes of~~ M~~&T Bank matured. Subordinated capital notes included in long-term borrowings averaged $979 million in the second quarter of~~&T's 2023 compared with $983 million in the second quarter of 2022 and $980 million in the first quarter of 2023. Junior subordinated debentures associated with trust preferred securities that were included in average long-term borrowings were $537 million during the second and first quarters of 2023 compared with $533 million in the second quarter of 2022. Annual Report.

Additional information regarding ~~junior subordinated debentures~~borrowings is provided in ~~note~~notes 5 and 11 of Notes to Financial Statements.

The Company has utilized interest rate swap agreements to modify the repricing characteristics of certain components of its loans and long-term debt. As of June 30, 2023, interest rate swap agreements were used as fair value

~~- 55 -~~

hedges of approximately $2.5 billion of outstanding fixed rate long-term borrowings. Additionally, interest rate swap agreements with a notional amount of $11.4 billion (exclusive of forward-starting swap agreements) were used as cash flow hedges of interest payments associated with variable rate commercial real estate loans. Further information on interest rate swap agreements is provided herein and in note 10 of Notes to Financial Statements.Net Interest Margin

Net interest income can be impacted by changes in the composition of the Company's earning assets and interest-bearing liabilities, as discussed herein, as well as changes in interest rates and spreads. Net interest spread, or the difference between the taxable-equivalent yield on earning assets and the rate paid on interest-bearing liabilities, was ~~3.03%~~2.48% in the recent quarter, ~~up 11~~down 8 basis points from ~~2.92%~~2.56% in the ~~second~~fourth quarter of ~~2022.~~2023. The decline in the net interest spread from the fourth quarter of 2023 reflects higher levels of average borrowings, partially offset by higher rates earned on investment securities. The yield on earning assets during the ~~second~~first quarter of ~~2023~~2024 was ~~5.46%~~5.74%, up ~~234~~1 basis ~~points~~point from ~~3.12%~~5.73% in the ~~similar 2022 period, while the~~fourth quarter of 2023. The rate paid on interest-bearing liabilities ~~increased 223 basis points to 2.43%~~was 3.26% in the recent quarter, ~~from .20%~~compared with 3.17% in the ~~year-earlier period.~~final quarter of 2023. In the first quarter of 2023, the net interest spread was 3.30%, the yield on earning assets was 5.16% and the rate paid on interest-bearing liabilities was 1.86%. The increases in the net interest spread since the second quarter of 2022 reflect the impact of generally rising interest rates that resulted in higher yields on loans and leases, deposits at the FRB of New York and investment securities, partially offset by higher rates on interest-bearing liabilities. The Federal Reserve raised its target Federal funds rate 5.0% from March 2022 through June 2023, including various increases totaling 275 basis points in the last half of 2022 and 50 basis points and 25 basis points in the first and second quarters of 2023, respectively. The decline in the net interest spread in the recent quarter as compared with the first quarter of 2023 ~~reflected increased demand for time deposit products, higher average borrowings and~~reflects the impact of ~~competitive pricing and rising~~higher rates associated with interest-bearing instruments. For the first six months of 2023, the net interest spread was 3.16%, up 38 basis points from 2.78% in the year-earlier period. The yield on earning assets and the rate paid on interest-bearing liabilities ~~for~~(predominantly interest-bearing deposits) resulting from a general rise in interest rates during the first ~~half~~three quarters of 2023, ~~were 5.31%~~which outpaced higher yields earned on loans and ~~2.15%, respectively, compared with 2.96%~~leases, deposits at the FRB of New York and ~~.18%, respectively, in the initial six months of 2022.~~investment securities.

Net interest-free funds consist largely of noninterest-bearing demand deposits and shareholders’ equity, partially offset by bank owned life insurance and non-earning assets, including goodwill and core deposit and other intangible assets. Net interest-free funds averaged ~~$67.7 billion in the second three months of 2023, compared with $84.7 billion in the year-earlier quarter and $72.9~~$61.7 billion in the first quarter of ~~2023.~~2024, compared with $62.9 billion in the fourth quarter of 2023 and $72.9 billion in the year-earlier quarter. The lower level of average net interest-free funds in the recent quarter as compared with the fourth and first ~~quarter~~quarters of 2023 ~~and second quarter of 2022~~ is predominantly the result of a decline in the average balance of noninterest-bearing ~~deposits.~~deposits, partially offset by increases in common shareholders equity from retained earnings, net of common and preferred stock dividends. Noninterest-bearing deposits averaged ~~$56.2~~$48.6 billion in the ~~second~~first quarter of 2024, compared with $50.1 billion in the last quarter of 2023 and $61.9 billion in the first quarter of ~~2023, compared with $74.1 billion~~2023. The decline in ~~the second quarter of 2022. The lower levels of~~average noninterest-bearing deposits insince the first ~~and second~~ quarter of 2023 ~~as compared with the second quarter of 2022 reflected~~reflects customer use of off-balance sheet investment products and a shift in deposits to interest-bearing accounts as interest rates rose. During the first six months of 2023 and 2022, average net interest-free funds aggregated $70.3 billion and $75.0 billion, respectively. Average noninterest-bearing deposits were $59.0 billion in the first half of 2023, compared with $66.1 billion in the first two quarters of 2022. The decline in average noninterest-bearing deposits, resulting from a shift of customer funds from noninterest-bearing accounts to interest-bearing accounts and off-balance sheet investment products, was partially offset by the impact of $17.4 billion of noninterest-bearing deposits the Company assumed in connection with the People's United acquisition on April 1, 2022. Shareholders’ equity averaged $25.7 billion during the three-month period ended June 30, 2023, compared with $26.1 billion during the year-earlier period and $25.4 billion during the first quarter of 2023. M&T issued $8.4 billion of common equity and $261 million of preferred equity in completing the acquisition of People's United on April 1, 2022. Repurchases of common stock totaled approximately $600 million in the first quarter of 2023 and $1.8 billion in the last three quarters of 2022. There were no repurchases of common stock during the second quarter of 2023. Goodwill and core deposit and other intangible assets averaged $8.7 billion in each of the second and first quarters of 2023 compared with $8.8 billion in the year-earlier quarter. The Company recorded $3.9 billion of goodwill on April 1, 2022 which represents excess consideration over the fair value of net assets acquired in the People's United transaction. As part of the transaction, intangible assets were identified and recorded at fair value, thereby increasing the balance of core deposit and other intangible assets on the Company's balance sheet by $261 million on April 1, 2022. The cash surrender value of bank owned life insurance averaged $2.6 billion in each of the second quarter of 2023, first quarter of 2023 and year-earlier quarter. Changes in the cash surrender value of bank owned life insurance and benefits received are not included in interest income, but rather are recorded in “other revenues from operations.”

~~- 56 -~~

The contribution of net interest-free funds to net interest margin was ~~.88%~~1.04% in the ~~second~~first quarter of ~~2023,~~2024, compared with ~~.09%~~1.05% in the fourth quarter of 2023 and .74% in the ~~second quarter of 2022 and the~~ first quarter of ~~2023, respectively.~~2023. The increased contribution of net interest-free funds to net interest margin in the two most recent ~~quarter and first quarter of 2023~~quarters as compared with the ~~second 2022~~first 2023 quarter reflects higher rates paid on interest-bearing liabilities used to value net interest-free funds. ~~The contribution of net interest-free funds in the first half of 2023 and 2022 was .81% and .08%, respectively.~~

Reflecting the changes to the net interest spread and the contribution of net interest-free funds as described herein, the Company’s net interest margin was ~~3.91%~~3.52% in the ~~second~~first quarter of 2024, compared with 3.61% in the fourth quarter of 2023 ~~compared with 3.01%~~and 4.04% in the year-earlier period. ~~During~~The higher interest rate environment has led to an increase in the ~~first six months~~rates paid on the Company's sources of ~~2023 and 2022,~~funding which has outpaced the ~~net interest margin was 3.97% and 2.86%, respectively.~~rise in yields on earning assets. Future changes in market interest rates or spreads, as well as changes in the composition of the Company’s portfolios of earning assets and interest-bearing liabilities that result in changes to spreads, could impact the Company’s net interest income and net interest margin. The Federal Open Market Committee has conducted a series of basis point increases in short-term interest rates from March 2022 through June 2023 totaling 5.0%. Those actions have led to generally higher interest rates overall and, accordingly, have contributed to the Company's higher net interest margin in the recent quarter as compared with the year-earlier quarter. The recent quarter's net interest margin narrowed from 4.04% in the first quarter of 2023. That 13 basis point decrease reflects a 27 basis point compression of the net interest spread partially offset by a 14 basis point increase in the contribution of interest-free funds.

Management assesses the potential impact of future changes in interest rates and spreads by projecting net interest income under several interest rate scenarios. In managing interest rate risk, the Company has utilized interest rate swap agreements to modify the repricing characteristics of certain portions of its earning assets and interest-bearing liabilities. Periodic settlement amounts arising from these agreements are reflected in either the yields on earning assets or the rates paid on interest-bearing liabilities. The notional amount of interest rate swap agreements entered into for interest rate risk management purposes was $13.9 billion (excluding $7.3 billion of forward-starting swap agreements related to cash flow hedges) at June 30, 2023, $16.0 billion (excluding $3.3 billion of forward-starting swap agreements) at June 30, 2022 and $12.7 billion (excluding $4.7 billion of forward-starting swap agreements) at December 31, 2022. Under the terms of those interest rate swap agreements, the Company received payments based on the outstanding notional amount at fixed rates and made payments at variable rates. ~~At June 30, 2023, interest rate swap~~Periodic settlement amounts arising from these agreements with notional amounts of $11.4 billion were serving as cash flow hedges of interest payments associated with variable rate commercial real estate loans, compared with $15.0 billion at June 30, 2022 and $11.2 billion at December 31, 2022. Interest rate swap agreements with notional amounts of $2.5 billion at June 30, 2023, $1.0 billion at June 30, 2022 and $1.5 billion at December 31, 2022 were serving as fair value hedges of fixed rate long-term borrowings.are reflected in either the yields on earning assets or the rates paid on interest-bearing liabilities. The Company ~~also~~ enters into forward-starting interest rate swap agreements predominantly to ~~extend the term of its~~hedge interest rate exposures expected in future periods. The following table summarizes information about interest rate swap agreements ~~serving as cash flow hedges and provide a hedge against changing interest rates on certain of its variable rate loans.~~

~~In a fair value hedge, the fair value of the derivative (the~~entered into for interest rate swap agreement) and changes in the fair value of the hedged item are recorded in the Company’s Consolidated Balance Sheet with the corresponding gain or loss recognized in current earnings. The difference between changes in the fair value of the interest rate swap agreements and the hedged items represents hedge ineffectiveness and is recorded as an adjustment to the interest income or interest expense of the respective hedged item. In a cash flow hedge, the derivative’s gain or loss is initially reported as a component of other comprehensive income and subsequently reclassified into earnings when the forecasted transaction affects earnings. The amounts of hedge ineffectiveness recognized during each of the quarters ended June 30, 2023, June 30, 2022 andrisk management purposes at March 31, ~~2023 were not material to the Company’s consolidated results of operations.~~ 2024 and December 31, 2023.

- 47 -

INTEREST RATE SWAP AGREEMENTS - DESIGNATED AS HEDGES


	Notional Amount						Average		Weighted-
			Forward-				Maturity		Average Rate
(Dollars in millions)	Active		Starting		Total		(In years)		Fixed			Variable
March 31, 2024
Fair value hedges:
Fixed rate long-term borrowings	$	2,000	$	1,850	$	3,850		5.9		3.48	%		5.51	%
Cash flow hedges:
Interest payments on variable rate commercial real estate loans		17,477		5,950		23,427		1.7	3.38			5.33
Total	$	19,477	$	7,800	$	27,277		2.3
December 31, 2023
Fair value hedges:
Fixed rate long-term borrowings	$	2,000	$	1,000	$	3,000		5.8		3.45	%		5.62	%
Cash flow hedges:
Interest payments on variable rate commercial real estate loans		14,977		9,000		23,977		1.7	3.45			5.36
Total	$	16,977	$	10,000	$	26,977		2.2

Information regarding the fair value of interest rate swap agreements ~~and hedge ineffectiveness~~ is presented in note 10 of Notes to Financial Statements. Information regarding the valuation of cash flow hedges included in other comprehensive income is presented in note 9 of Notes to Financial Statements. The changes in the fair values of the interest rate swap agreements and the hedged items primarily result from the effects of changing interest rates and spreads. The average notional amounts of interest rate swap agreements entered into for interest rate risk management purposes (excluding forward-starting interest rate swap agreements not in effect during the quarter), the related effect on net interest income and margin and the weighted-average interest rates paid or received on those swap agreements ~~are~~is presented in the ~~accompanying table. Additional information about the Company’s use of interest rate swap agreements and other derivatives is included in note 10 of Notes to Financial Statements.~~

~~- 57 -~~

table that follows.

INTEREST RATE SWAP AGREEMENTS - EFFECT ON NET INTEREST INCOME

Three Months Ended June 30
.

2023

2022

Amount

Rate (a)

Amount

Rate (a)

(Dollars in thousands)
Increase (decrease) in:

Interest income

$
(48,691
)

(.11
)
%
$
19,947

.04

%
Interest expense

14,388

.05

(5,297
)

(.02
)

Net interest income/margin

$
(63,079
)

(.14
)
%
$
25,244

.05

%
Average notional amount (c)

$
13,027,330

$
14,894,505

Rate received (b)

3.13

%

1.46

%
Rate paid (b)

5.04

%

.79

%

Six Months Ended June 30
.

2023

2022

Amount

Rate(a)

Amount

Rate(a)

(Dollars in thousands)
Increase (decrease) in:

Interest income

$
(107,730
)

(.12
)
%
$
57,966

.07

%
Interest expense

24,308

.04

(13,785
)

(.03
)

Net interest income/margin

$
(132,038
)

(.14
)
%
$
71,751

.09

%
Average notional amount (c)

$
12,053,796

$
14,933,149

Rate received (b)

2.92

%

1.46

%
Rate paid (b)

5.10

%

.51

%


	Three Months Ended March 31,
.	2024						2023
(Dollars in millions)	Amount			Rate (a)			Amount			Rate (a)
Increase (decrease) in:
Interest income (cash flow hedges)	$	(87	)		-.18	%	$	(59	)		-.13	%
Interest expense (fair value hedges)		13			.04			10			.04
Net interest income/margin	$	(100	)		-.21	%	$	(69	)		-.15	%
Average notional amount (b)	$	19,202					$	11,069
Rate received (c)					3.32	%					2.68	%
Rate paid (c)					5.38						5.17

(a)

Computed as an annualized percentage of average earning assets or interest-bearing liabilities.

(b)

Excludes forward-starting interest rate swap agreements not in effect during the period.

(c)

Weighted-average rate paid or received on interest rate swap agreements in effect during the period.

Provision for Credit Losses

A provision for credit losses is recorded to adjust the level of the allowance to reflect expected credit losses that are based on economic forecasts as of each reporting date. A provision for credit losses of $200 million was recorded in the first quarter of 2024, compared with $225 million in the fourth quarter of 2023 and $120 million in the year-earlier quarter. The comparatively higher provisions for credit losses in the most recent two quarters as compared with the first quarter of 2023 reflect declines in commercial real estate values and higher interest rates contributing to a deterioration in the performance of loans to commercial borrowers, including nonautomotive dealers and healthcare facilities, as well as growth in certain sectors of M&T's commercial and industrial and consumer loan portfolios. Net charge-offs totaled $138 million in 2024's first quarter as compared with $148 million in 2023's final quarter and $70 million in the year-earlier quarter. The lower level of net charge-offs in the first quarter of 2024 as compared with the preceding quarter included a decline in commercial real estate loan net charge-offs, partially offset by an increase in net charge-offs of commercial and industrial and consumer loans. As compared with year-earlier first quarter, the recent quarter net charge-offs reflect higher levels of commercial and industrial and consumer loan net charge-offs.

- 48 -

A summary of net charge-offs by loan type and as an annualized percentage of such average loans is presented in the table that follows.

NET CHARGE-OFF (RECOVERY) INFORMATION


	First Quarter 2024					Fourth Quarter 2023					First Quarter 2023
(Dollars in millions)	Net Charge-Offs (Recoveries)		Annualized Percentage of Average Loans			Net Charge-Offs (Recoveries)		Annualized Percentage of Average Loans			Net Charge-Offs (Recoveries)			Annualized Percentage of Average Loans
Commercial and industrial	$	73		.51	%	$	42		.30	%	$	10			.08	%
Real estate:
Commercial		8		.13			63		.98			28			.43
Residential builder and developer		—		.03			—		.10			2			.48
Other commercial construction		11		.69			7		.39			(2	)		-.09
Residential		—		-.01			3		.07			1			.01
Residential - limited documentation		—		—			—		-.01			—			—
Consumer:
Home equity lines and loans		—		.02			—		.04			—			.04
Recreational finance		21		.80			18		.72			11			.50
Automobile		5		.46			3		.32			2			.21
Other		20		4.03			12		2.14			18			3.51
Total	$	138		.42	%	$	148		.44	%	$	70			.22	%

Asset Quality

A summary of nonperforming assets and certain past due loan data and credit quality ratios is presented in the accompanying table.

NONPERFORMING ASSET AND PAST DUE LOAN DATA


(Dollars in millions)	March 31, 2024			December 31, 2023			March 31, 2023
Nonaccrual loans	$	2,302		$	2,166		$	2,557
Real estate and other foreclosed assets		38			39			44
Total nonperforming assets	$	2,340		$	2,205		$	2,601
Accruing loans past due 90 days or more (a)	$	297		$	339		$	407
Government-guaranteed loans included in totals above:
Nonaccrual loans	$	62		$	53		$	42
Accruing loans past due 90 days or more (a)		244			298			306
Loans 30-89 days past due		1,410			1,724			1,892

Nonaccrual loans to total net loans and leases		1.71	%		1.62	%		1.92	%
Nonperforming assets to total net loans and leases and real estate and other foreclosed assets		1.73			1.64			1.96
Accruing loans past due 90 days or more to total net loans and leases		.22			.25			.31
Loans 30-89 days past due to total net loans and leases		1.04			1.29			1.42

~~(c)~~(a)

~~Excludes forward-starting~~Predominantly residential real estate loans.

Nonaccrual loans were $2.3 billion at March 31, 2024, $136 million higher than December 31, 2023 and $255 million lower than March 31, 2023. The higher level of nonaccrual loans at the recent quarter end as compared with the immediately preceding quarter end was largely attributable to an increase in commercial and industrial nonaccrual loans, most notably loans to nonautomotive finance dealers and the manufacturing and services industries, partially offset by a decrease in commercial real estate nonaccrual loans. The decrease in nonaccrual loans at March 31, 2024 as compared with year-earlier quarter was predominantly due to lower levels of commercial real estate nonaccrual loans, including net charge-offs, and residential real estate nonaccrual loans, partially offset by a rise in commercial and industrial nonaccrual loans.

- 49 -

Government-guaranteed loans classified as accruing loans past due 90 days or more included one-to-four family residential mortgage loans serviced by the Company that were repurchased to reduce associated servicing costs, including a requirement to advance principal and interest payments that had not been received from individual mortgagors. Despite the loans being purchased by the Company, the insurance or guarantee by the applicable government-related entity remains in force. The outstanding principal balances of the repurchased loans included in the amounts noted herein that are guaranteed by government-related entities totaled $195 millionat March 31, 2024, $228 million at December 31, 2023 and $242 million at March 31, 2023. The remaining accruing loans past due 90 days or more not guaranteed by government-related entities were loans considered to be with creditworthy borrowers that were in the process of collection or renewal.

Approximately 73% of loans 30 to 89 days past due were less than 60 days delinquent at each of March 31, 2024 and December 31, 2023. Information about past due and nonaccrual loans at March 31, 2024 and December 31, 2023 is also included in note 4 of Notes to Financial Statements.

During the normal course of business, the Company modifies loans to maximize recovery efforts. The types of modifications that the Company grants typically include principal deferrals and interest rate ~~swap agreements~~reductions but may also include other types of modifications. The Company may offer such modified terms to borrowers experiencing financial difficulty. Such modified loans may be considered nonaccrual if the Company does not expect to collect the contractual cash flows owed under the loan agreement. Information about modifications of loans to borrowers experiencing financial difficulty is included in ~~effect~~note 4 of Notes to Financial Statements.

The Company utilizes a loan grading system to differentiate risk amongst its commercial and industrial loans and commercial real estate loans. Loans with a lower expectation of default are assigned one of ten possible “pass” loan grades while specific loans determined to have an elevated level of credit risk are classified as “criticized.” A criticized loan may be classified as “nonaccrual” if the Company no longer expects to collect all amounts according to the contractual terms of the loan agreement or the loan is delinquent 90 days or more.

Line of business personnel in different geographic locations with support from and review by the Company’s credit risk personnel review and reassign loan grades based on their detailed knowledge of individual borrowers and their judgment of the impact on such borrowers resulting from changing conditions in their respective regions. The Company’s policy is that, at least annually, updated financial information is obtained from commercial borrowers associated with pass grade loans and additional analysis performed. On a quarterly basis, the Company’s centralized credit risk department personnel reviews all criticized commercial and industrial loans and commercial real estate loans greater than $5 million to determine the appropriateness of the assigned loan grade, including whether the loan should be reported as accruing or nonaccruing. For criticized nonaccrual loans, additional meetings are held with loan officers and their managers, workout specialists and senior management to discuss each of the relationships. In analyzing criticized loans, borrower-specific information is reviewed, including operating results, future cash flows, recent developments and the borrower’s outlook, and other pertinent data. The timing and extent of potential losses, considering collateral valuation and other factors, and the Company’s potential courses of action are contemplated.

Targeted loan reviews have periodically been performed over segments of loan portfolios that are experiencing heightened credit risk due to current or anticipated economic conditions. The intention of such reviews is to identify trends across such portfolios and inform portfolio risk limits and loss mitigation strategies. The business climate in the first quarter of 2024 has continued to be subjected to inflationary pressures and elevated interest rates. These conditions have impacted many borrowers, particularly those with investor-owned commercial real estate loans in the hotel, office, retail, multifamily and healthcare sectors, including construction-related financing, and commercial and industrial loans to nonautomotive dealers and manufacturing and transportation industries. In 2023 and 2024, the Company completed targeted loan reviews covering the majority of its investor-owned commercial real estate portfolio, inclusive of construction loans, with a focus on criticized loans and loans with maturities in the next twelve months. The primary source of repayment of these loans is typically tenant lease payments to the investor/borrower. Vacancies, which have been influenced by certain demographic changes, and higher interest rates have contributed to lower current and anticipated future debt service coverage ratios, which has and could continue to influence the ability of borrowers to make existing loan payments. Lower debt service coverage ratios and reduced commercial real estate values also impact the ability of borrowers to refinance their obligations at loan maturity. As a result, criticized

- 50 -

investor-owned commercial real estate loans have remained elevated at $8.5 billion or 26% of such loans at March 31, 2024 and $8.8 billion or 27% of such loans at December 31, 2023. Investor-owned commercial real estate loans comprised 66% and 70% of total criticized loans at March 31, 2024 and December 31, 2023, respectively. The weighted-average LTV ratios for investor-owned commercial real estate loans was approximately 56% at each of March 31, 2024 and December 31, 2023. Criticized loans secured by investor-owned commercial real estate had a weighted-average LTV ratio of approximately 62% at March 31, 2024 and 61% at December 31, 2023.

The Company monitors its concentration of commercial real estate lending as a percentage of its Tier 1 capital plus its allowable allowance for credit losses, consistent with a metric utilized to differentiate such concentrations amongst regulated financial institutions. This metric, as prescribed in supervisory guidance, excludes loans secured by commercial real estate considered to be owner-occupied, but includes certain other loans, such as loans to real estate investment trusts, that are classified as commercial and industrial loans. The Company's commercial real estate loan concentration approximated 176% of Tier 1 capital plus its allowable allowance for credit losses at March 31, 2024, compared with 183% at December 31, 2023. The Company has reduced its relative concentration of investor-owned commercial real estate loans throughout 2023 and the first quarter of 2024.

The accompanying tables summarize the outstanding balances, and associated criticized balances, of commercial and industrial loans and leases by industry and commercial real estate loans by property type, respectively, at March 31, 2024 and December 31, 2023.

CRITICIZED COMMERCIAL AND INDUSTRIAL LOANS


	March 31, 2024								December 31, 2023
(Dollars in millions)	Outstanding		Criticized Accrual		Criticized Nonaccrual		Total Criticized		Outstanding		Criticized Accrual		Criticized Nonaccrual		Total Criticized
Commercial and industrial excluding owner-occupied real estate by industry:
Financial and insurance	$	10,538	$	261	$	37	$	298	$	10,679	$	346	$	3	$	349
Services		7,180		260		130		390		6,715		295		100		395
Motor vehicle and recreational finance dealers		6,268		525		109		634		6,242		164		51		215
Manufacturing		6,226		616		122		738		5,981		549		65		614
Wholesale		3,955		268		34		302		3,803		180		45		225
Transportation, communications, utilities		3,525		233		70		303		3,342		195		71		266
Retail		2,893		83		41		124		2,727		102		35		137
Construction		2,089		176		68		244		2,092		173		62		235
Health services		1,991		286		34		320		1,950		297		28		325
Real estate investors		1,618		195		4		199		1,684		189		4		193
Other		1,676		100		54		154		1,889		123		50		173
Total commercial and industrial excluding owner-occupied real estate	$	47,959	$	3,003	$	703	$	3,706	$	47,104	$	2,613	$	514	$	3,127
Owner-occupied real estate by industry:
Services	$	2,122	$	140	$	51	$	191	$	2,162	$	154	$	51	$	205
Motor vehicle and recreational finance dealers		1,922		45		9		54		1,867		10		7		17
Retail		1,587		132		14		146		1,541		107		13		120
Wholesale		944		48		3		51		940		28		2		30
Manufacturing		837		58		29		87		842		64		24		88
Real estate investors		795		24		16		40		818		26		12		38
Health services		639		53		22		75		656		55		26		81
Other		1,092		33		17		50		1,080		32		21		53
Total owner-occupied real estate		9,938		533		161		694		9,906		476		156		632
Total	$	57,897	$	3,536	$	864	$	4,400	$	57,010	$	3,089	$	670	$	3,759

- 51 -

CRITICIZED COMMERCIAL REAL ESTATE LOANS


	March 31, 2024								December 31, 2023
(Dollars in millions)	Outstanding		Criticized Accrual		Criticized Nonaccrual		Total Criticized		Outstanding		Criticized Accrual		Criticized Nonaccrual		Total Criticized
Permanent finance by property type:
Apartments/Multifamily	$	6,441	$	1,003	$	112	$	1,115	$	6,165	$	1,184	$	115	$	1,299
Retail/Service		5,795		1,039		229		1,268		5,912		1,075		227		1,302
Office		4,599		1,011		147		1,158		4,727		879		185		1,064
Health services		3,626		1,409		177		1,586		3,615		1,364		117		1,481
Hotel		2,485		485		175		660		2,510		496		210		706
Industrial/Warehouse		1,925		133		13		146		2,034		224		13		237
Other		297		45		2		47		314		28		2		30
Total permanent		25,168		5,125		855		5,980		25,277		5,250		869		6,119
Construction/Development		7,248		2,419		144		2,563		7,726		2,527		174		2,701
Total	$	32,416	$	7,544	$	999	$	8,543	$	33,003	$	7,777	$	1,043	$	8,820

Total criticized commercial and industrial loans and commercial real estate loans were $12.9 billion and $12.6 billion at March 31, 2024 and December 31, 2023, respectively. Criticized loans represented 14.3% of the total commercial and industrial and commercial real estate loans at March 31, 2024, compared with 14.0% at December 31, 2023. At March 31, 2024 and December 31, 2023, permanent finance commercial real estate loans comprised 46% and 49% of total criticized loans, respectively, whereas commercial and industrial loans represented 34% and 30%, respectively, and construction loans represented 20% and 21%, respectively. Loans to nonautomotive finance dealers and manufacturing, wholesale and transportation companies mainly contributed to the $641 million increase in commercial and industrial criticized loans from December 31, 2023 to March 31, 2024.

The Company’s loss identification and estimation techniques with respect to loans secured by residential real estate make reference to loan performance and house price data in specific areas of the country where collateral securing the Company’s residential real estate loans is located. For residential real estate-related loans, including home equity loans and lines of credit, the excess of the loan balance over the net realizable value of the property collateralizing the loan is charged-off when the loan becomes 150 days delinquent. That charge-off is based on recent indications of value from external parties that are generally obtained shortly after a loan becomes nonaccrual. Loans to consumers that file for bankruptcy are generally charged-off to estimated net collateral value shortly after the Company is notified of such filings. Limited documentation first lien mortgage loans represent loans secured by residential real estate that at origination typically included some form of limited borrower documentation requirements as compared with more traditional loans. The Company no longer originates limited documentation loans. With respect to junior lien loans, to the extent known by the Company, if a related senior lien loan would be on nonaccrual status because of payment delinquency, even if such senior lien loan was not owned by the Company, the junior lien loan or line that is owned by the Company is placed on nonaccrual status. In monitoring the credit quality of its home equity portfolio for purposes of determining the allowance for credit losses, the Company reviews delinquency and nonaccrual information and considers recent charge-off experience. When evaluating individual home equity loans and lines of credit for charge-off and for purposes of determining the allowance for credit losses, the Company considers the required repayment of any first lien positions related to collateral property. Information about the location of loans secured by residential real estate is presented in the following table.

- 52 -

NONACCRUAL LOANS SECURED BY RESIDENTIAL REAL ESTATE


	March 31, 2024
			Nonaccrual
					Percent of
	Outstanding				Outstanding
(Dollars in millions)	Balances		Balances		Balances
Residential mortgage loans:
New York	$	6,625	$	85		1.28	%
Mid-Atlantic (a)		6,605		57		.86
New England (b)		6,010		43		.72
Other		2,952		17		.58
Total	$	22,192	$	202		.91	%
Limited documentation first lien mortgage loans:
New York	$	403	$	24		5.81	%
Mid-Atlantic (a)		361		20		5.52
New England (b)		84		7		8.76
Other		36		2		6.53
Total	$	884	$	53		6.00	%
First lien home equity loans and lines of credit:
New York	$	815	$	17		2.06	%
Mid-Atlantic (a)		967		23		2.43
New England (b)		456		6		1.25
Other		17		3		16.54
Total	$	2,255	$	49		2.16	%
Junior lien home equity loans and lines of credit:
New York	$	767	$	16		2.15	%
Mid-Atlantic (a)		910		15		1.64
New England (b)		600		7		1.11
Other		26		—		.52
Total	$	2,303	$	38		1.66	%

(a)

Includes Delaware, Maryland, New Jersey, Pennsylvania, Virginia, West Virginia and the District of Columbia.

(b)

Includes Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island and Vermont.

Factors that influence the Company’s credit loss experience include overall economic conditions affecting businesses and consumers, generally, but also residential and commercial real estate valuations, in particular, given the size of the Company’s real estate loan portfolios. Commercial real estate valuations can be highly subjective, as they are based upon many assumptions. Such valuations can be significantly affected over relatively short periods of time by changes in business climate, economic conditions, interest rates and, in many cases, the results of operations of businesses and other occupants of the real property. Similarly, residential real estate valuations can be impacted by housing trends, the availability of financing at reasonable interest rates and general economic conditions affecting consumers.

A comparative summary of consumer loans in nonaccrual status by product is presented in the following table.

NONACCRUAL CONSUMER LOANS


(Dollars in millions)	March 31, 2024		December 31, 2023
Home equity lines and loans	$	87	$	81
Recreational finance		30		36
Automobile		13		14
Other		54		52
Total	$	184	$	183

- 53 -

Allowance for Credit Losses

Management determines the allowance for credit losses under accounting guidance that requires estimating the amount of current expected credit losses over the remaining contractual term of the loan and lease portfolio. A description of the methodologies used by the Company to estimate its allowance for credit losses can be found in note 4 of Notes to Financial Statements.

ALLOWANCE FOR CREDIT LOSSES MACROECONOMIC ASSUMPTIONS


	March 31, 2024									December 31, 2023
	Year 1			Year 2			Cumulative			Year 1			Year 2			Cumulative
National unemployment rate		4.4	%		4.7	%					4.4	%		4.7	%
Real GDP growth rate		1.0		1.8				2.8	%		.9		1.9				2.8	%
Commercial real estate price index growth/decline rate	-6.9			5.5			-1.5			-9.1			4.8			-4.5
Home price index growth/ decline rate		-2.0			.4		-1.6			-3.2				-.1		-3.3

In establishing the allowance for credit losses, the Company also considers the impact of portfolio concentrations, imprecision in economic forecasts, geopolitical conditions and other risk factors that influence the loss estimation process. With respect to economic forecasts, the Company assessed the likelihood of alternative economic scenarios during the two-year reasonable and supportable time period. Generally, an increase in unemployment rate or a decrease in any of the rate of change in GDP, commercial real estate prices or home prices could have an adverse impact on expected credit losses and may result in an increase to the allowance for credit losses. Forward-looking economic forecasts are subject to inherent imprecision and future events may differ materially from forecasted events. In consideration of such uncertainty, the following alternative economic scenarios were considered to estimate the possible impact on modeled credit losses.

- 54 -

ALLOWANCE FOR CREDIT LOSSES SENSITIVITIES


	March 31, 2024
	Year 1			Year 2			Cumulative
Potential downside economic scenario:
National unemployment rate		6.5	%		7.4	%
Real GDP growth/decline rate	-2.3			1.6				-.8	%
Commercial real estate price index decline rate		-18.0			-2.0		-19.6
Home price index growth/decline rate		-10.4			.5			-10.0
Potential upside economic scenario:
National unemployment rate	3.3			3.2
Real GDP growth rate	3.5			2.4				6.0
Commercial real estate price index growth/decline rate	-1.8			9.2				7.3
Home price index growth rate	2.7			2.2				5.0


(Dollars in millions)	Impact to Modeled Credit Losses Increase (Decrease)
Potential downside economic scenario	$	347
Potential upside economic scenario		(170	)

These examples are only a few of the numerous possible economic scenarios that could be utilized in assessing the sensitivity of expected credit losses. The estimated impacts on credit losses in such scenarios pertain only to modeled credit losses and do not include consideration of other factors the Company may evaluate when determining its allowance for credit losses. As a result, it is possible that the Company may, at another point in time, reach different conclusions regarding credit loss estimates. The Company’s process for determining the allowance for credit losses undergoes quarterly and periodic evaluations by independent risk management personnel, which among many other considerations, evaluate the reasonableness of management’s methodology and significant assumptions. Further information about the Company’s methodology to estimate expected credit losses is included in note 4 of Notes to Financial Statements.

Management has assessed that the allowance for credit losses at March 31, 2024 appropriately reflected expected credit losses inherent in the portfolio as of that date. The allowance for credit losses totaled $2.2 billion at March 31, 2024, compared with $2.1 billion at December 31, 2023. As a percentage of loans outstanding, the allowance was 1.62% at March 31, 2024 and 1.59% at December 31, 2023. The increase in the allowance for credit losses as a percentage of loans and leases outstanding reflects a higher level of credit losses expected on certain commercial borrowers, including nonautomotive dealers and healthcare facilities. Included in the allocation of the allowance for credit losses were reserves for loans secured by office properties of 4.37% at each of March 31, 2024 and December 31, 2023. The level of the allowance reflects management’s evaluation of the loan and lease portfolio using the methodology and considering the factors as described herein. Should the various economic forecasts and credit factors considered by management in establishing the allowance for credit losses change and should management’s assessment of losses in the loan portfolio also change, the level of the allowance as a percentage of loans could increase or decrease in future periods. The reported level of the allowance reflects management’s evaluation of the loan and lease portfolio as of each respective date. Furthermore, the Company's allowance is general in nature and is available to absorb losses from any loan or lease category.

The ratio of the allowance for credit losses to total nonaccrual loans at March 31, 2024 and December 31, 2023 was 95% and 98%, respectively. Given the Company’s general position as a secured lender and its practice of charging off loan balances when collection is deemed doubtful, that ratio and changes in the ratio are generally not an indicative measure of the adequacy of the Company’s allowance for credit losses, nor does management rely upon that ratio in assessing the adequacy of the Company’s allowance for credit losses.

- 55 -

Other Income

The components of other income are presented in the accompanying table.

OTHER INCOME


	Three Months Ended				Change						Three Months Ended				Change
(Dollars in millions)	March 31, 2024		December 31, 2023		Amount			%			March 31, 2024		March 31, 2023		Amount			%
Mortgage banking revenues	$	104	$	112	$	(8	)		-7	%	$	104	$	85	$	19			23	%
Service charges on deposit accounts		124		121		3			2			124		113		11			9
Trust income		160		159		1			1			160		194		(34	)		-17
Brokerage services income		29		26		3			10			29		24		5			20
Trading account and other non-hedging derivative gains		9		11		(2	)		-19			9		12		(3	)		-21
Gain (loss) on bank investment securities		2		4		(2	)		-35			2		—		2			—
Other revenues from operations		152		145		7			4			152		159		(7	)		-5
Total other income	$	580	$	578	$	2			—	%	$	580	$	587	$	(7	)		-1	%

Mortgage banking revenues

Mortgage banking revenues are comprised of both residential and commercial mortgage banking activities, which consist of realized gains and losses from sales of real estate loans and loan servicing rights, unrealized gains and losses on real estate loans held for sale and related commitments, real estate loan servicing fees, and other real estate loan related fees and income. The Company's involvement in commercial mortgage banking activities includes the origination, sales and servicing of loans under the multifamily loan programs of Fannie Mae, Freddie Mac, and the U.S. Department of Housing and Urban Development.

RESIDENTIAL MORTGAGE BANKING ACTIVITIES


	Three Months Ended				Change					Three Months Ended				Change
(Dollars in millions)	March 31, 2024		December 31, 2023		Amount		%			March 31, 2024		March 31, 2023		Amount		%
Residential mortgage banking revenues
Gains on loans originated for sale	$	7	$	5	$	2		35	%	$	7	$	3	$	4		138	%
Loan servicing fees		39		38		1		2			39		20		19		100
Loan sub-servicing and other fees		32		31		1		5			32		32		—		1
Total loan servicing revenues		71		69		2		3			71		52		19		38
Total residential mortgage banking revenues	$	78	$	74	$	4		5	%	$	78	$	55	$	23		43	%
New commitments to originate loans for sale	$	288	$	243	$	45		18	%	$	288	$	276	$	12		5	%


(Dollars in millions)	March 31, 2024		December 31, 2023		March 31, 2023
Balances at period end
Loans held for sale	$	165	$	190	$	152
Commitments to originate loans for sale		211		163		199
Commitments to sell loans		315		295		284
Capitalized mortgage loan servicing assets		432		456		532

Loans serviced for others		39,598		40,021		41,547
Loans sub-serviced for others (a)		111,964		115,321		97,989
Total loans serviced for others	$	151,562	$	155,342	$	139,536

(a)

The contractual servicing rights associated with residential mortgage loans sub-serviced by the Company were predominantly held by affiliates of BLG. Information about the Company’s relationship with BLG and its affiliates is included in note 15 of Notes to Financial Statements.

•

The increase in residential mortgage loan servicing fees of $19 million in the three-month period ending March 31, 2024 as compared with the similar 2023 period primarily reflects a $350 million bulk purchase of residential mortgage loan servicing rights associated with $19.5 billion of residential real estate loans on March 31, 2023.

•

The lower balance of capitalized residential mortgage servicing rights at March 31, 2024 and December 31, 2023 as compared with March 31, 2023 reflects amortization of those servicing rights.

- 56 -

COMMERCIAL MORTGAGE BANKING ACTIVITIES


	Three Months Ended				Change						Three Months Ended				Change
(Dollars in millions)	March 31, 2024		December 31, 2023		Amount			%			March 31, 2024		March 31, 2023		Amount			%
Commercial mortgage banking revenues
Gains on loans originated for sale	$	8	$	20	$	(12	)		-62	%	$	8	$	14	$	(6	)		-45	%
Loan servicing fees and other		18		18		—			2			18		16		2			12
Total commercial mortgage banking revenues	$	26	$	38	$	(12	)		-32	%	$	26	$	30	$	(4	)		-14	%
Loans originated for sale to other investors	$	1,044	$	506	$	538			106	%	$	1,044	$	672	$	372			55	%


(Dollars in millions)	March 31, 2024		December 31, 2023		March 31, 2023
Balances at period end
Loans held for sale	$	563	$	189	$	321
Commitments to originate loans for sale		451		916		588
Commitments to sell loans		1,014		1,105		909
Capitalized mortgage loan servicing assets		122		123		124

Loans serviced for others (a)		24,771		24,157		22,389
Loans sub-serviced for others		3,906		3,873		3,786
Total loans serviced for others	$	28,677	$	28,030	$	26,175

(a)

Includes $4.0 billion, $3.9 billion and $3.8 billion of loan balances for which investors had recourse to the Company if such balances are ultimately uncollectible at March 31, 2024, December 31, 2023 and March 31, 2023, respectively.

•

The decline in gains on commercial mortgage loans originated for sale in the first three months of 2024 as compared with the fourth quarter of 2023 and the corresponding 2023 period reflects lower volumes of new commitments to originate commercial real estate loans for sale, which were influenced by a higher interest rate environment.

Service charges on deposit accounts

Service charges on deposit accounts in the recent quarter increased $3 million from the fourth quarter of 2023 reflecting higher commercial service charges from pricing changes. The $11 million increase in the recent quarter as compared with the similar 2023 quarter also reflects the increased customer usage of sweep products.

Trust income

Trust income includes fees from two significant businesses managed within the Company's Institutional Services and Wealth Management segment. The Institutional Services business provides a variety of trustee, agency, investment management and administrative services for corporations and institutions, investment bankers, corporate tax, finance and legal executives, and other institutional clients who: (i) use capital markets financing structures; (ii) use independent trustees to hold assets (including retirement plan assets prior to the sale of CIT); and (iii) need investment and cash management services. The Wealth Management business offers personal trust, planning, fiduciary, asset management, family office and other services designed to help high net worth individuals and families grow, preserve and transfer wealth.

TRUST INCOME AND ASSETS UNDER MANAGEMENT


	Three Months Ended				Change						Three Months Ended				Change
(Dollars in millions)	March 31, 2024		December 31, 2023		Amount			%			March 31, 2024		March 31, 2023		Amount			%
Trust income
Institutional Services	$	81	$	82	$	(1	)		-1	%	$	81	$	120	$	(39	)		-32	%
Wealth Management		78		76		2			3			78		74		4			4
Commercial		1		1		—			9			1		—		1			179
Total trust income	$	160	$	159	$	1			1	%	$	160	$	194	$	(34	)		-17	%


(Dollars in millions)	March 31, 2024		December 31, 2023		March 31, 2023
Assets under management at period end
Trust assets under management (excluding proprietary funds)	$	65,191	$	63,963	$	161,495
Proprietary mutual funds		15,280		14,772		14,124
Total assets under management	$	80,471	$	78,735	$	175,619

- 57 -

•

In April 2023, M&T completed the divestiture of its CIT business to a private equity firm. Revenues associated with that business and included in Institutional Services trust income totaled $45 million in the first quarter of 2023. After considering expenses, the results of operations of that business were not material to M&T's net income in 2023's initial quarter.

•

Institutional Services trust income not related to the CIT business increased $6 million for the first three months of 2024 as compared with the similar 2023 period reflecting higher sales and fund management fees from its global capital markets business.

•

The lower assets under management at March 31, 2024 and December 31, 2023 as compared with March 31, 2023 reflects the sale of the CIT business in the second quarter of 2023.

Other revenues from operations

The components of other revenues from operations are presented in the accompanying table.

OTHER REVENUES FROM OPERATIONS


	Three Months Ended				Change						Three Months Ended				Change
(Dollars in millions)	March 31, 2024		December 31, 2023		Amount			%			March 31, 2024		March 31, 2023		Amount			%
Letter of credit and other credit-related fees	$	44	$	54	$	(10	)		-19	%	$	44	$	43	$	1			1	%
Merchant discount and credit card fees		40		42		(2	)		-6			40		39		1			1
Bank owned life insurance revenue (a)		16		19		(3	)		-18			16		13		3			23
Equipment operating lease income		11		12		(1	)		-7			11		21		(10	)		-49
BLG income (b)		25		—		25			—			25		20		5			25
Other		16		18		(2	)		-7			16		23		(7	)		-26
Total other revenues from operations	$	152	$	145	$	7			4	%	$	152	$	159	$	(7	)		-5	%

(a)

Tax-exempt income earned from bank owned life insurance includes increases in the cash surrender value of life insurance policies and benefits received. The Company owns both general account and separate account life insurance policies. To the extent market conditions change such that the market value of assets in a separate account bank owned life insurance policy becomes less than the previously recorded cash surrender value, an adjustment is recorded as a reduction to other revenues from operations.

(b)

During 2017, the operating losses of BLG resulted in M&T reducing the carrying value of its investment in BLG to zero. Subsequently, M&T has received cash distributions when declared by BLG that result in the recognition of income by M&T. M&T expects cash distributions from BLG in the future, but the timing and amount of those distributions are not within M&T's control. BLG is entitled to receive distributions from its affiliates that provide asset management and other services that are available for distribution to BLG’s owners, including M&T. Information about the Company’s relationship with BLG and its affiliates is included in note 15 of Notes to Financial Statements.

•

The decrease in letter of credit and other credit-related fees of $10 million in the recent quarter as compared with the fourth quarter of 2023 was primarily the result of lower loan syndication fees.

•

Equipment operating lease income declined $10 million in 2024's first quarter as compared with the similar 2023 quarter reflecting lower gains on sales of leased equipment.

•

Distributions from M&T's investment in BLG were $25 million and $20 million for the quarters ended March 31, 2024 and 2023, respectively. There were no such distributions in the fourth quarter of 2023.

Other Expense

The components of other expense are presented in the accompanying table.

OTHER EXPENSE


	Three Months Ended				Change						Three Months Ended				Change
(Dollars in millions)	March 31, 2024		December 31, 2023		Amount			%			March 31, 2024		March 31, 2023		Amount			%
Salaries and employee benefits	$	833	$	724	$	109			15	%	$	833	$	808	$	25			3	%
Equipment and net occupancy		129		134		(5	)		-4			129		127		2			2
Outside data processing and software		120		114		6			5			120		106		14			13
Professional and other services		85		99		(14	)		-13			85		125		(40	)		-31
FDIC assessments		60		228		(168	)		-74			60		30		30			101
Advertising and marketing		20		26		(6	)		-21			20		31		(11	)		-35
Amortization of core deposit and other intangible assets		15		15		—			—			15		17		(2	)		-13
Other costs of operations		134		110		24			21			134		115		19			16
Total other expense	$	1,396	$	1,450	$	(54	)		-4	%	$	1,396	$	1,359	$	37			3	%

- 58 -

Salaries and employee benefits

•

The number of full time equivalent employees was 21,927 at March 31, 2024, compared with 21,980 at December 31, 2023 and 23,004 at March 31, 2023. Included in each of the first quarters of 2024 and 2023 was $99 million of seasonally higher stock-based compensation, medical plan costs, payroll-related taxes and unemployment insurance.

•

Salaries and employee benefits expenses increased $109 million in the recent quarter as compared with the fourth quarter of 2023 reflecting the aforementioned seasonal costs, annual merit increases and a rise in incentive compensation, partially offset by lower severance expense.

•

Salaries and employee benefits expenses increased $25 million in the recent quarter as compared with the year-earlier quarter reflecting annual merit increases in the first quarter of 2024, other pay increases in 2023 and higher incentive compensation, partially offset by lower employee staffing levels.

Nonpersonnel expenses

•

FDIC assessments reflect a $197 million estimated special assessment in the fourth quarter of 2023 and $29 million of estimated incremental special assessment expense recorded in the first quarter of 2024.

•

Nonpersonnel expenses aggregated $563 million in the recent quarter as compared with $726 million in the fourth quarter of 2023. After considering the FDIC special assessments, the $5 million increase in the recent quarter as compared with 2023's fourth quarter reflects an increase in other costs of operations of $24 million, including higher costs associated with the Company's supplemental executive retirement savings plan, losses on lease terminations related to certain vacated properties and incremental charitable contributions. Those unfavorable factors were partially offset by lower professional and other services expenses of $14 million, reflecting the timing and level of consulting and legal-related fees.

•

Nonpersonnel expenses increased $12 million in the recent quarter from $551 million in the year-earlier first quarter. That increase includes an FDIC special assessment of $29 million, higher outside data processing and software costs of $14 million and a rise in other costs of operations of $19 million, reflecting amortization of mortgage loan servicing rights obtained through a bulk purchase in March 2023. Those unfavorable factors were partially offset by lower professional and other services expenses of $40 million reflecting lower sub-advisory fees following the sale of the CIT business in April 2023 and a decline in advertising and marketing costs of $11 million.

Income Taxes

Income tax expense was $133 million in the first quarter of 2024, compared with $143 million in the fourth quarter of 2023 and $224 million in the year-earlier quarter. The effective tax rates were 20.0%, 22.9% and 24.2% for the quarters ended March 31, 2024, December 31, 2023 and March 31, 2023, respectively. The first quarter of 2024 income tax expense included a net discrete benefit related to the resolution of a tax matter inherited from the acquisition of People's United. The effective tax rate is affected by the level of income earned that is exempt from tax relative to the overall level of pre-tax income, the amount of income allocated to the various state and local jurisdictions where the Company operates, because tax rates differ among such jurisdictions, and the impact of any large discrete or infrequently occurring items. The Company’s effective tax rate in future periods may also be affected by any change in income tax laws or regulations and interpretations of income tax regulations that differ from the Company’s interpretations by any of various tax authorities that may examine tax returns filed by M&T or any of its subsidiaries.

- 59 -

Liquidity Risk

As a financial intermediary, the Company is exposed to various risks, including liquidity and market risk. Liquidity refers to the Company’s ability to ensure that sufficient cash flow and liquid assets are available to satisfy current and future obligations, including demands for loans and deposit withdrawals, funding operating costs and other corporate purposes. Liquidity risk arises whenever cash flows associated with financial instruments included in assets and liabilities differ.

The most significant source of funding for the Company is core deposits, which are generated from a large base of consumer, corporate and institutional customers. That customer base has, over the past several years, become more geographically diverse as a result of expansion of the Company’s businesses. Nevertheless, the Company faces competition in offering products and services from a large array of financial market participants, including banks, thrifts, mutual funds, securities dealers and others. Core deposits totaled $151.5 billion and $146.5 billion at March 31, 2024 and December 31, 2023, respectively. The increase in core deposits at March 31, 2024 as compared with December 31, 2023 reflects a higher level of trust customer deposits.

The Company supplements funding provided through deposits with various short-term and long-term wholesale borrowings, including overnight federal funds purchased, ~~short-term~~repurchase agreements, advances from ~~the FHLB of New York,~~FHLBs, brokered deposits and longer-term borrowings. M&T Bank has access to additional funding sources through secured borrowings from the FHLB of New York ~~lines~~and the FRB of ~~credit with~~New York. Beginning in the first quarter of 2024, M&T Bank became a counterparty to the FRB of New York ~~M&T Bank’s Bank Note Program, and other available borrowing facilities. The Bank Note Program enables M&T Bank~~standing repurchase agreement facility, which allows it to ~~offer unsecured senior and subordinated notes.~~enter into overnight repurchase transactions using eligible investment securities. The Company has, ~~from time to time,~~in the past, issued subordinated capital notes and junior subordinated debentures associated with trust preferred securities to provide liquidity and enhance regulatory capital ratios. The Company’s junior subordinated debentures associated with trust preferred securities and other subordinated capital notes are considered Tier 2 capital and are includable in total regulatory capital. At ~~June 30, 2023~~March 31, 2024 and December 31, ~~2022,~~2023, long-term borrowings aggregated ~~$7.4~~$11.5 billion and ~~$4.0~~$8.2 billion, respectively and short-term borrowings aggregated ~~$7.9~~$4.8 billion and ~~$3.6~~$5.3 billion, respectively. Information about the Company's borrowings is presented in note 5 of Notes to Financial Statements.

The Company has benefited from the placement of brokered deposits. The Company had brokered savings and interest-checking deposit accounts which aggregated ~~approximately $3.8~~$7.9 billion at ~~each of June 30, 2023~~March 31, 2024 and December 31, 2022, compared with $3.9 billion at June 30, 2022. Funding from brokered time deposits increased $799 million and $4.0 billion in the first and second quarter of 2023, respectively to $8.9 billion at June 30, 2023 from $4.1$7.8 billion at December 31, ~~2022.~~2023. Brokered time deposits ~~were not~~totaled $4.7 billion at March 31, 2024 and $6.1 billion at December 31, 2023. Approximately 87% of brokered time deposits at March 31, 2024 have a ~~significant source of funding at June 30, 2022.~~contractual maturity date in the next 12 months.

~~- 58 -~~

Total uninsured deposits were estimated to be $71.9 billion at March 31, 2024 and $67.0 billion at December 31, 2023. Approximately $11.4 billion and $10.7 billion of those uninsured deposits were collateralized by the Company at March 31, 2024 and December 31, 2023, respectively. The Company maintains available liquidity sources which represent approximately 135% of uninsured deposits that are not collateralized by the Company at March 31, 2024.

The Company’s ability to obtain funding from these sources could be negatively impacted should the Company experience a substantial deterioration in its financial condition or its debt ratings or should the availability of funding become restricted due to a disruption in the financial markets. The Company attempts to quantify such ~~credit-event risk~~risks by ~~modeling scenarios~~conducting scenario analyses that estimate the liquidity impact resulting from a ~~short-term~~debt ratings downgrade ~~over various grading levels.~~and other market events. Such impact is estimated by attempting to measure the effect on available unsecured lines of credit, available capacity from secured borrowing sources and securitizable assets.

M&T’s primary source of funds to pay for operating expenses, shareholder dividends and treasury stock repurchases has historically been the receipt of dividends from its bank subsidiaries, which are subject to various regulatory limitations. Dividends from any bank subsidiary to M&T are limited by the amount of earnings of the subsidiary in the current year and the two preceding years. For purposes of that test, at March 31, 2024 approximately $1.2 billion was available for payment of dividends to M&T from bank subsidiaries. M&T also may obtain funding through long-term borrowings. Further information about the long-term outstanding borrowings of M&T is provided in note 5 of Notes to Financial Statements. As a bank holding company, M&T is obligated to serve as a managerial and financial source of strength to its bank subsidiaries as described in Part I, Item 1, "Business" in the 2023 Annual Report. As its ability to access the capital markets may be affected by market disruptions, M&T maintains sufficient cash resources at its parent company to satisfy projected cash outflows for an extended period without reliance on dividends from subsidiaries or external financing. As of March 31, 2024, M&T's parent company liquidity covered projected cash

- 60 -

outflows for more than 24 months, including dividends on common and preferred stock, debt service and scheduled debt maturities.

In addition to deposits and borrowings, other sources of liquidity include maturities and repayments of investment securities, loans and other earning assets, ~~repayments of loans and investment securities, and~~as well as cash generated from operations, such as fees collected for services. The Company also has the ability to securitize or sell certain financial assets, including various loan types, to provide other liquidity alternatives. ~~On August 7, 2023, Moody's Investor Service reaffirmed M&T Bank's short-term deposit rating at Prime-1, but downgraded M&T's~~U.S. Treasury and ~~M&T Bank's senior~~federal agency securities and ~~subordinated debt ratings from A3 to Baa1 and M&T Bank's long-term deposits rating from Aa3 to A1.~~

~~Certain customers~~government issued or guaranteed mortgage-backed securities comprised 90% of the ~~Company obtain financing through the issuance~~Company's debt securities portfolio at March 31, 2024. The weighted-average durations of ~~variable rate demand bonds (“VRDBs”). The VRDBs are generally enhanced by letters of credit provided by M&T Bank. M&T Bank oftentimes acts as remarketing agent~~debt investment securities available for ~~the VRDBs~~sale and held to maturity at its discretion, may from time-to-time own some of the VRDBs while such instruments are remarketed. When this occurs, the VRDBs are classified as trading account assets in the Company’s Consolidated Balance Sheet. Nevertheless, M&T Bank is not contractually obligated to purchase the VRDBs. ThereMarch 31, 2024 were ~~no such securities in the trading account at June 30, 2023, December 31, 2022~~2.0 years and June 30, 2022. The total amounts of VRDBs outstanding backed by M&T Bank letters of credit were $564 million at June 30, 2023, $604 million at December 31, 2022 and $645 million at June 30, 2022. M&T Bank also serves as remarketing agent for most of those bonds.5.4 years, respectively.

The Company enters into contractual obligations in the normal course of business that require future cash payments. Such obligations include, among others, payments related to deposits, borrowings, leases and other contractual commitments. Off-balance sheet commitments to customers may impact liquidity, including commitments to extend credit, standby letters of credit, commercial letters of credit, financial guarantees and indemnification contracts, and commitments to sell real estate loans. Because many of these commitments or contracts expire without being funded in whole or in part, the contract amounts are not necessarily indicative of future cash flows. Further discussion of these commitments is provided in note 13 of Notes to Financial Statements.

M&T’s primary source of funds to pay for operating expenses, shareholder dividends and treasury stock repurchases has historically been the receipt of dividends from its bank subsidiaries, which are subject to various regulatory limitations. Dividends from any bank subsidiary to M&T are limited by the amount of earnings of the subsidiary in the current year and the two preceding years. For purposes of that test, at June 30, 2023 approximately $1.63 billion was available for payment of dividends to M&T from bank subsidiaries. M&T also may obtain funding through long-term borrowings. As previously described, in January 2023 M&T issued $1.0 billion of senior notes that mature in January 2034. Outstanding senior notes of M&T at June 30, 2023 and December 31, 2022 were $2.2 billion and $1.2 billion, respectively. Junior subordinated debentures of M&T associated with trust preferred securities outstanding at June 30, 2023 and December 31, 2022 totaled $538 million and $536 million, respectively.

~~Management~~The Company's Executive ALCO Committee closely monitors the Company’s liquidity position on an ongoing basis for compliance with internal policies and regulatory ~~expectations~~expectations. As a Category IV institution, the Company adheres to enhanced liquidity standards which require the performance of internal liquidity stress testing. The stress testing is designed to ensure the Company has sufficient liquidity to withstand both institution-specific and ~~believes that~~market-wide stress scenarios. For each scenario, the Company applies liquidity stress which may include deposit run-off, increased draws on unfunded loan commitments, increased collateral need for margin calls, increased haircuts on investment security-based funding and reductions in unsecured and secured borrowing capacity. Stress scenarios are measured over various time frames ranging from overnight to twelve months. As required by regulation, the Company maintains a liquidity buffer comprised of cash and highly liquid unencumbered securities to cover a 30-day stress horizon. Liquidity stress events occurring over longer time horizons can be mitigated by the availability of secured funding sources at the FHLB of New York and FRB of New York. The following table is a summary of the Company's available sources of liquidity ~~are adequate to meet funding needs anticipated in the ordinary course of business. Available liquidity~~ at June 30, 2023 included cash on deposit at the FRB of New York of $27.1 billion, unused lines of credit of $31.0 billion and unencumbered investment securities (after estimated haircut) of approximately $18.5 billion. March 31, 2024.

AVAILABLE LIQUIDITY SOURCES


(Dollars in millions)	March 31, 2024
Deposits at the FRB of New York	$	32,033
Unused secured borrowing facilities:
FRB of New York		18,404
FHLB of New York		14,589
Unencumbered investment securities (after estimated haircuts)		16,506
Total	$	81,532

Management ~~continually~~continuously evaluates the use and mix of its various available funding alternatives, including short-term borrowings, ~~issuance~~issuances of long-term debt, the placement of brokered deposits and the securitization of certain loan products. Management does not anticipate engaging in any activities, either currently or in the long term, for which adequate funding would not be available and would therefore result in a significant strain on liquidity at either M&T or its subsidiary banks. In accordance with liquidity regulations, the Company maintains a contingency funding plan to facilitate on-going liquidity management in times of liquidity stress. The plan outlines various funding options available during a liquidity stress event and establishes a clear escalation protocol to be followed within the Company's risk management framework. The plan sets forth funding strategies and procedures that management can quickly leverage to assist in decision-making and specifies roles and responsibilities for departments impacted by a potential liquidity stress event.

- 61 -

Market Risk and Interest Rate Sensitivity

Market risk is the risk of loss from adverse changes in the market prices and/or interest rates of the Company’s financial instruments. The primary market risk the Company is exposed to is interest rate risk. Interest rate risk arises from the Company’s core banking activities of lending and deposit-taking, because assets and liabilities reprice at

~~- 59 -~~

different times and by different amounts as interest rates change. As a result, net interest income earned by the Company is subject to the effects of changing interest rates. The Company measures interest rate risk by calculating the variability of net interest income in future periods under various interest rate scenarios using projected balances for earning assets, interest-bearing liabilities and derivatives used to ~~manage~~hedge interest rate risk. Management’s philosophy toward interest rate risk management is to limit the variability of net interest income. The balances of financial instruments used in the projections are based on expected growth from forecasted business opportunities, anticipated prepayments of loans and investment securities, and expected maturities of investment securities, loans and deposits. Management uses a “value of equity” model to supplement the modeling technique described above. Those supplemental analyses are based on discounted cash flows associated with on- and off-balance sheet financial instruments. Such analyses are modeled to reflect changes in interest rates and provide management with a long-term interest rate risk metric. The Company has entered into interest rate swap agreements to help manage exposure to interest rate risk. At ~~June 30, 2023,~~March 31, 2024, the aggregate notional amount of interest rate swap agreements entered into for interest rate risk management purposes that were currently in effect was ~~$13.9~~$19.5 billion. In addition, the Company has entered into ~~$7.3~~$7.8 billion of forward-starting interest rate swap agreements predominantly related to cash flow hedges. Information about interest rate swap agreements entered into for interest rate risk management purposes is included herein under the heading “Net Interest Margin” and in note 10 of Notes to Financial Statements.

The Company’s ~~Asset-Liability~~Executive ALCO Committee ~~which includes members of executive management,~~ monitors the sensitivity of the Company’s net interest income to changes in interest rates with the aid of a computer model that forecasts net interest income under different interest rate scenarios. In modeling changing interest rates, the Company considers different yield curve shapes that consider both parallel (that is, simultaneous changes in interest rates at each point on the yield curve) and non-parallel (that is, allowing interest rates at points on the yield curve to vary by different amounts) shifts in the yield curve. In utilizing the model, market-implied forward interest rates over the subsequent twelve months are generally used to determine a base interest rate scenario for the net interest income simulation. That calculated base net interest income is then compared with the income calculated under the varying interest rate scenarios. The model considers the impact of ongoing lending and deposit-gathering activities, as well as interrelationships in the magnitude and timing of the repricing of financial instruments, including the effect of changing interest rates on expected prepayments and maturities. When deemed prudent, management has taken actions to mitigate exposure to interest rate risk through the use of on- or off-balance sheet financial instruments and intends to do so in the future. Possible actions include, but are not limited to, changes in the pricing of loan and deposit products, modifying the composition of earning assets and interest-bearing liabilities, and adding to, modifying or terminating existing interest rate swap agreements or other financial instruments used for interest rate risk management purposes.

The accompanying table as of ~~June 30, 2023~~March 31, 2024 and December 31, ~~2022~~2023 displays the estimated impact on net interest income in the base scenario described above resulting from parallel changes in interest rates across repricing categories during the first modeling year.

SENSITIVITY OF NET INTEREST INCOME

TO CHANGES IN INTEREST RATES


	Calculated Increase (Decrease) in Projected Net Interest Income
Changes in interest rates	June 30, 2023			December 31, 2022			Calculated Change in Projected Net Interest Income
	(In thousands)

(Dollars in millions)							March 31, 2024			December 31, 2023
+200 basis points	$	102,183			224,555		$	(50	)	$	(18	)
+100 basis points		83,575			158,020			5			20
-100 basis points		(164,202	)		(216,202	)		(18	)		(46	)
-200 basis points		(329,022	)		(439,512	)		(36	)		(83	)

The Company utilized many assumptions to calculate the impact that changes in interest rates may have on net interest income. The more significant of those assumptions included the rate of prepayments of mortgage-related assets, cash flows from derivative and other financial instruments, loan and deposit volumes, mix and pricing, and deposit maturities. In the scenarios presented, the Company also assumed gradual changes in interest rates during a twelve-month period as compared with the base scenario. Changes in amounts presented since December 31, ~~2022~~2023 reflect changes in portfolio composition (including shifts between noninterest-bearing and interest-bearing deposits and higher levels of borrowings), the level of market-implied forward interest rates and hedging actions taken by the

- 62 -

Company. Amidst the rising interest rate environment since the first quarter of 2022, M&T's cumulative deposit pricing beta,

~~- 60 -~~

which is the change in deposit pricing in response to a change in market interest rates, approximated 4055 percent. Excluding brokered deposits that cumulative pricing beta approximated 3450 percent. The cumulative deposit pricing beta (including and excluding brokered deposits) is assumed to approximate 4050 to 4555 percent in the ~~scenarios presented with~~ interest rate ~~increases and to approximate 35 to 40 percent in the~~ scenarios ~~presented with interest rate decreases.~~presented. The assumptions used in interest rate sensitivity modeling are inherently uncertain and, as a result, the Company cannot precisely predict the impact of changes in interest rates on net interest income. Actual results may differ significantly from those presented due to the timing, magnitude and frequency of changes in interest rates and changes in market conditions and interest rate differentials (spreads) between maturity/repricing categories, as well as any actions, such as those previously described, which management may take to counter such changes.

~~Certain~~ Management also uses an “economic value of equity” model to supplement the ~~Company's earning assets, interest-bearing liabilities, preferred equity instruments~~modeling technique described above and interest rate swap agreements at June 30, 2023 have contractual repricing terms that reference the London Interbank Offered Rate ("LIBOR"). The determination of LIBOR has effectively ceased after its final publication on June 30, 2023. In preparation for the elimination of LIBOR asprovide a reference rate, the Company essentially had discontinued entering into LIBOR-based contracts at the end of 2021 and as of the end of the second quarter of 2023 has substantially completed its work engaging with customers and other counterparties to remediate LIBOR-based agreements which expire after June 30, 2023 by incorporating alternative language, negotiating new agreements, or other means. The Company's enterprise-wide LIBOR transition program has been and continues to be monitored by executive management as well as the Risk Committee of the Board of Directors.

At June 30, 2023 the Company had outstanding LIBOR-based commercial loans and leases and commercial real estate loans of $19.2 billion and residential mortgage and consumer loans of $445 million. Substantially all of those loans have been amended to include appropriate alternative language effective upon cessation of LIBOR publication and are planned to migrate to a new index (generally SOFR) at their next scheduled reset date, which except for an insignificant percentage of the Company's loan portfolio is expected to occur in the third quarter of 2023. Additionally, M&T has approximately $483 million of variable rate junior subordinated debentures at June 30, 2023 that, as described in note 9 of Notes to Financial Statements in the Company's Form 10-K, will be indexed to SOFR beginning at their next scheduled reset date. M&T also has certain issued and outstanding preferred stock for which dividends are declared and paid at a fixed rate until a determined future date at which time such dividends convert to a variable rate that previously would have been based on LIBOR, but will now be based on SOFR. Refer to note 10 of Notes to Financial Statements in the Company's Form 10K for information on the rates for dividends on each series of preferred stock. At June 30, 2023 many of the Company's interest rate swap agreements referenced LIBOR. In October 2020, the International Swaps and Derivatives Association, Inc. published the IBOR Fallbacks Supplement ("Supplement") and the IBOR Fallback Protocol ("Protocol"). The Protocol enables market participants to incorporate certain revisions into their legacy non-cleared derivative trades with other counterparties that also choose to adhere to the Protocol. M&T adhered to the Protocol in November 2020. With respect to the Company's cleared interest rate swap agreements that reference LIBOR, clearinghouses have adopted the same SOFR benchmark alternatives of the Supplement and Protocol. Substantially all of the Company's LIBOR-based interest rate swap agreements at June 30, 2023 are expected to reset to a suitable alternative index, primarily SOFR, by the end of the third quarter of 2023.

As loans have matured and new originations occurred a larger percentage of the Company’s variable-rate loans reference SOFR or other indexes, including the Bloomberg Short Term Bank Yield Index (“BSBY”). At June 30, 2023 the Company had approximately $48.1 billion and $233 million of outstanding loan balances that reference SOFR and BSBY, respectively. Additionally, as of June 30, 2023, the Company had $20.7 billion of notional amounts of interest rate swap agreements entered into for hedging purposes, including $7.3 billion of forward-starting interest rate swap agreements and notional amounts of $24.5 billion of non-hedging derivative interest rate contracts that are referenced to SOFR. The Company’s usage of interest rate swap agreements referenced to SOFR or other alternative indexes is expected to increase in response to the discontinuation of LIBOR. The discontinuation of LIBOR and uncertainty relating to the emergence of alternative benchmark indexes to replace LIBOR could materially impact the Company'slong-term interest rate risk ~~profile~~metric. Economic value of equity is a point-in-time analysis of the economic sensitivity of assets, liabilities and ~~its management thereof.~~off-balance sheet positions that incorporates all cash flows over their estimated remaining lives. Management measures the impact of changes in market values due to interest rates under a number of scenarios, including immediate shifts of the yield curve.

In addition to the effect of interest rates, changes in fair value of the Company’s financial instruments can also result from a lack of trading activity for similar instruments in the financial markets. ~~That impact is most notable on~~

~~- 61 -~~

~~the values assigned to some of the Company’s investment securities.~~ Information about the fair valuation of ~~investment securities~~financial instruments is presented in ~~notes 3 and~~note 12 of Notes to Financial Statements.

The Company enters into interest rate and foreign exchange contracts to meet the financial needs of customers that it includes in its financial statements as other non-hedging derivatives within other assets and other liabilities. Financial instruments utilized for such activities consist predominantly of interest rate swap agreements and forward and futures contracts related to foreign currencies. The Company generally mitigates the foreign currency and interest rate risk associated with customer activities by entering into offsetting positions with third parties that are also included in other assets and other liabilities. The fair values of non-hedging derivative positions associated with interest rate contracts and foreign currency and other option and futures contracts are presented in note 10 of Notes to Financial Statements. As with any non-government guaranteed financial instrument, the Company is exposed to credit risk associated with counterparties to the Company’s non-hedging derivative activities. Although the notional amounts of these contracts are not recorded in the Consolidated Balance Sheet, the unsettled fair values of such financial instruments are recorded in the Consolidated Balance Sheet. The fair values of such non-hedging derivative assets and liabilities recognized on the Consolidated Balance Sheet were ~~$313~~$258 million and ~~$1.3~~$1.0 billion, respectively, at ~~June 30, 2023~~March 31, 2024 and ~~$380~~$256 million and ~~$1.3 billion,~~$898 million, respectively, at December 31, ~~2022.~~2023. The fair value asset and liability amounts at ~~June 30,~~March 31, 2024 have been reduced by contractual settlements of $893 million and $16 million, respectively, and at December 31, 2023 have been reduced by contractual settlements of ~~$1.1 billion~~$783 million and ~~$17 million, respectively, and at December 31, 2022 have been reduced by contractual settlements of $1.1 billion and $29~~$32 million, respectively. The ~~values~~amounts associated with the Company's non-hedging derivative activities at ~~June 30, 2023 as compared with~~March 31, 2024 and December 31, ~~2022~~2023 reflect changes in values associated with interest rate swap agreements entered into with commercial customers that are not subject to periodic variation margin settlement payments.

Trading account assets were ~~$137~~$99 million at ~~June 30, 2023, $118~~March 31, 2024 and $106 million at December 31, ~~2022 and $134 million at June 30, 2022.~~2023. Included in trading account assets were assets related to deferred compensation plans of $22 million at ~~June 30, 2023, $23 million at~~each of March 31, 2024 and December 31, ~~2022 and $17 million at June 30, 2022.~~2023. Changes in the fair values of such assets are recorded as ~~“trading~~trading account and other non-hedging derivative ~~gains”~~gains in the Consolidated Statement of Income. Included in ~~“other liabilities”~~accrued interest and other liabilities in the Consolidated Balance Sheet ~~at June 30, 2023~~ was $27 million of liabilities related to deferred compensation plans ~~compared with $29 million~~ at each of March 31, 2024 and December 31, ~~2022 and $22 million at June 30, 2022.~~2023. Changes in the balances of such liabilities due to the valuation of allocated investment options to which the liabilities are indexed ~~are~~and recorded in ~~“other~~other costs of ~~operations”~~operations in the Consolidated Statement of Income. Also included in trading account assets were investments in mutual funds and other assets that the Company was required to hold under terms of certain non-qualified supplemental retirement and other benefit plans that were assumed by the Company in various acquisitions. Those assets totaled ~~$83~~$77 million at ~~June 30, 2023, $95~~March 31, 2024 and $80 million at December 31, ~~2022 and $117 million at June 30, 2022.~~2023.

Given the Company’s policies and positions, management believes that the potential loss exposure to the Company resulting from market risk associated with trading account and other non-hedging derivative activities was not material, however, as previously noted, the Company is exposed to credit risk associated with counterparties to transactions

- 63 -

related to the Company’s actions to mitigate foreign currency and interest rate risk associated with customer activities. ~~Additional information~~Information about the Company’s use of derivative financial instruments is included in note 10 of Notes to Financial Statements.

~~Provision for Credit Losses~~

A provision for credit losses is recorded to adjust the level of the allowance to reflect expected credit losses that are based on economic forecasts as of each reporting date. A provision for credit losses of $150 million was recorded in the second quarter of 2023, compared with $302 million in the year-earlier quarter and $120 million in the first quarter of 2023. The Company's estimates of expected credit losses at June 30, 2023 reflect an expected uptick in the unemployment rate, a brief retraction of economic activity measured by gross domestic product followed by growth, and a decline in residential real estate prices. Expected declines in commercial real estate values were forecasted to steepen and, in particular, concerns continue around the healthcare and office building sectors. The provision for credit losses in the second quarter of 2022 included $242 million on loans obtained in the acquisition of People's United not deemed to be purchased credit deteriorated ("PCD"). GAAP requires a provision for credit losses to be recorded related to those loans beyond the recognition of credit losses utilized in the determination of the estimated fair value of the

~~- 62 -~~

loans at the acquisition date. In addition to the recorded provision, the allowance for credit losses was also increased by $99 million in the second quarter of 2022 to reflect the expected credit losses on loans obtained in the acquisition of People's United deemed to be PCD. That addition represented an increase of the carrying values of loans identified as PCD at the time of the acquisition.

~~A summary of net charge-offs by loan type and as an annualized percentage of such average loans is presented in the table that follows.~~

~~NET CHARGE-OFFS (RECOVERIES)~~

~~BY LOAN/LEASE TYPE~~

2023

First Quarter

Second Quarter

Year-
to-date

Net Charge-Offs (Recoveries)

Percentage of Average Loans

Net Charge-Offs (Recoveries)

Percentage of Average Loans

Net Charge-Offs (Recoveries)

Percentage of Average Loans

(Dollars in thousands)

Commercial, financial, leasing, etc.

$
9,561

.09
%

$
4,827

.04
%

$
14,388

.07
%
Real estate:

Commercial

29,055

.26

99,037

.88

128,092

.57

Residential

378

.01

(1,243
)

(.02
)

(865
)

(.01
)
Consumer

31,227

.62

24,123

.48

55,350

.55

$
70,221

.22
%

$
126,744

.38
%

$
196,965

.30
%

2022

First Quarter

Second Quarter (a)

Year-
to-date (a)

Net Charge-Offs (Recoveries)

Percentage of Average Loans

Net Charge-Offs (Recoveries)

Percentage of Average Loans

Net Charge-Offs (Recoveries)

Percentage of Average Loans

(Dollars in thousands)

Commercial, financial, leasing, etc.

$
5,569

.10
%

$
29,502

.31
%

$
35,071

.23
%
Real estate:

��

Commercial

(13,143
)

(.15
)

7,140

.06

(6,003
)

(.03
)
Residential

865

.02

256

—

1,121

.01

Consumer

13,576

.31

12,671

.26

26,247

.28

$
6,867

.03
%

$
49,569

.16
%

$
56,436

.10
%

~~(a)~~

~~For the three and six months ended June 30, 2022, net charge-offs do not reflect $33 million of charge-offs related to PCD acquired loans.~~

Net charge-offs of commercial loans in the second quarter of 2023 reflect a $9 million recovery of a previously charged off loan to a skilled nursing facility. There were no individually notable commercial loan charge-offs or recoveries in the first quarter of 2023. Net charge-offs of commercial loans in the year-earlier quarter reflected a $23 million charge-off of a loan to a consumer products manufacturer. The net charge-offs of commercial real estate loans in the second quarter of 2023 reflect a $38 million charge-off of a loan secured by a multi-tenant office and retail building in New York City, a $28 million charge-off of eight loans related to a single operator of multiple healthcare facilities located in New York, Vermont, and Rhode Island, a $13 million charge-off of a loan secured by a multi-tenant office and retail building in Massachusetts, and a $12 million charge-off to a real estate development and management company in the mid-Atlantic region. There were no notable charge-offs or recoveries of commercial real estate loans in the second quarter of 2022. Net charge-offs of commercial real estate loans in the first quarter of 2023 included an $18 million net charge-off of a loan secured by a multi-tenant office and retail building in New York City and a $9 million charge-off of a loan to a real estate development and management company in the mid-Atlantic region. Included in net charge-offs of consumer loans were: net charge-offs of automobile loans of less than $1 million in the recent quarter and $2 million in the first quarter of 2023, compared with net recoveries of $1 million in the second quarter of 2022; net charge-offs of recreational finance loans of $10 million in the second quarter of 2023, $7 million in the year-earlier quarter and $11 million in the first quarter of 2023; and net charge-offs associated with other consumer loans including credit cards and installment loans that totaled $14 million in the recent quarter, $7 million in the year-earlier quarter and $17 million in the first quarter of 2023.

~~- 63 -~~

Nonaccrual loans aggregated $2.4 billion or 1.83% of total loans and leases outstanding at June 30, 2023, compared with $2.6 billion or 2.05% at June 30, 2022 and $2.4 billion or 1.85% at December 31, 2022, and $2.6 billion or 1.92% at March 31, 2023. Loans obtained in the acquisition of People's United that have been classified as nonaccrual totaled $570 million at June 30, 2023, $545 million at June 30, 2022, $572 million at December 31, 2022, and $605 million at March 31, 2023. The level of nonaccrual loans reflects the continuing impact of economic conditions on borrowers’ abilities to make contractual payments on their loans, most notably commercial real estate loans in the retail, office, healthcare and hospitality sectors.

Accruing loans past due 90 days or more were $380 million or .29% of loans and leases at June 30, 2023, compared with $524 million or .41% at June 30, 2022, $491 million or .37% at December 31, 2022 and $407 million or .31% at March 31, 2023. Approximately 75% of accruing loans past due 90 days or more were residential real estate loans and included in that population were loans guaranteed by government-related entities of $294 million, $468 million, $363 million, and $306 million at June 30, 2023, June 30, 2022, December 31, 2022 and March 31, 2023, respectively. The lower balances reported since June 30, 2022 reflect residential real estate loans guaranteed by government-related entities receiving payment deferrals during the COVID-19 pandemic, but ineligible for treatment under the CARES Act, that subsequently exited those arrangements and became less than 90 days past due. Guaranteed loans included one-to-four family residential mortgage loans serviced by the Company that were repurchased to reduce associated servicing costs, including a requirement to advance principal and interest payments that had not been received from individual mortgagors. Despite the loans being purchased by the Company, the insurance or guarantee by the applicable government-related entity remains in force. The outstanding principal balances of the repurchased loans included in the amounts noted above that are guaranteed by government-related entities totaled $223 million at June 30, 2023, $435 million at June 30, 2022, $294 million at December 31, 2022, and $242 million at March 31, 2023. The remaining accruing loans past due 90 days or more not guaranteed by government-related entities were loans considered to be with creditworthy borrowers that were in the process of collection or renewal.

Loans that were 30-89 days past due were $1.7 billion at June 30, 2023, or 1.24% of total loans outstanding, $952 million or .74% of total loans outstanding at June 30, 2022, $1.8 billion or 1.35% of total loans outstanding at December 31, 2022, and $1.9 billion or 1.42% of total loans outstanding at March 31, 2023. At June 30, 2023, 75% of loans 30-89 days past due were less than 60 days delinquent. Loans subject to COVID-19 related payment deferrals were classified as current in accordance with regulatory guidance and, as a result, did not contribute to past due loan categories in earlier periods. Information about delinquent loans at June 30, 2023 and December 31, 2022 is included in note 4 of Notes to Financial Statements.

During the normal course of business, the Company modifies loans to maximize recovery efforts. The types of modifications that the Company grants typically include principal deferrals and interest rate reductions but may also include other types of modifications. The Company may offer such modified terms to borrowers experiencing financial difficulty. Such modified loans may be considered nonaccrual if the Company does not expect to collect the contractual cash flows owed under the loan agreement. Information about modifications of loans to borrowers experiencing financial difficulty is included in note 4 of Notes to Financial Statements.

~~- 64 -~~

Commercial loans and leases classified as nonaccrual totaled $416 million, $442 million, $347 million and $382 million at June 30, 2023, June 30, 2022, December 31, 2022 and March 31, 2023, respectively. Commercial real estate loans in nonaccrual status aggregated $1.5 billion at June 30, 2023, $1.6 billion at June 30, 2022, $1.5 billion at December 31, 2022 and $1.7 billion at March 31, 2023. Commercial real estate loans in nonaccrual status were largely reflective of loans in the retail, office, healthcare and hospitality sectors. Commercial loans and leases and commercial real estate loans acquired from People's United and classified as nonaccrual totaled $96 million and $418 million, respectively, at June 30, 2023, $188 million and $312 million, respectively, at June 30, 2022, $118 million and $401 million, respectively, at December 31, 2022 and $96 million and $456 million, respectively, at March 31, 2023.

Nonaccrual residential real estate loans totaled $305 million at June 30, 2023, compared with $444 million at June 30, 2022, $350 million at December 31, 2022 and $323 million at March 31, 2023. The lower balance of nonaccrual residential real estate loans at the three most recent quarter-ends as compared with June 30, 2022 is reflective of improved customer repayment performance in current economic conditions. Residential real estate loans obtained in the acquisition of People's United and classified as nonaccrual aggregated $39 million at June 30, 2023, $35 million at June 30, 2022, $36 million at December 31, 2022 and $37 million at March 31, 2023. Included in residential real estate loans classified as nonaccrual were limited documentation first mortgage loans of $67 million at June 30, 2023, compared with $113 million at June 30, 2022, $78 million at December 31, 2022 and $69 million at March 31, 2023. Limited documentation first mortgage loans represent loans secured by residential real estate that at origination typically included some form of limited borrower documentation requirements as compared with more traditional loans. The Company no longer originates limited documentation loans. Residential real estate loans past due 90 days or more and accruing interest aggregated $284 million at June 30, 2023, compared with $474 million at June 30, 2022, $345 million at December 31, 2022 and $293 million at March 31, 2023. Those amounts related predominantly to government-guaranteed loans. The lower balances at June 30, 2023, December 31, 2022 and March 31, 2023 as compared with the 2022's second quarter reflect improved borrower repayment performance. Information about the location of nonaccrual and charged-off residential real estate loans as of and for the quarter ended June 30, 2023 is presented in the accompanying table.

Nonaccrual consumer loans were $184 million at June 30, 2023, $196 million at June 30, 2022, $218 million at December 31, 2022 and $189 million at March 31, 2023. Included in nonaccrual consumer loans at June 30, 2023, June 30, 2022, December 31, 2022 and March 31, 2023 were: automobile loans of $22 million, $36 million, $40 million and $27 million, respectively; recreational finance loans of $32 million, $33 million, $45 million and $34 million, respectively; and outstanding balances of home equity loans and lines of credit of $77 million, $79 million, $85 million and $81 million, respectively. Consumer loans acquired from People's United and classified as nonaccrual were $16 million at each of June 30, 2023 and March 31, 2023 and totaled $10 million and $17 million at June 30, 2022 and December 31, 2022, respectively, and consisted predominantly of home equity loans and lines of credit. Information about the location of nonaccrual and charged-off home equity loans and lines of credit as of and for the quarter ended June 30, 2023 is presented in the accompanying table.

~~- 65 -~~

~~Information about past due and nonaccrual loans as of June 30, 2023 and December 31, 2022 is also included in note 4 of Notes to Financial Statements.~~

~~SELECTED RESIDENTIAL REAL ESTATE-RELATED LOAN DATA~~

Quarter Ended

June 30, 2023

June 30, 2023

Nonaccrual

Net Charge-offs (Recoveries)

Annualized

Percent of

Percent of

Average

Outstanding

Outstanding

Outstanding

Balances

Balances

Balances

Balances

Balances

(Dollars in thousands)

Residential mortgages:

New York

$
6,821,113

$
95,922

1.41
%

$
260

.02
%
Mid-Atlantic (a)

6,779,605

71,460

1.05

(1,191
)

(.07
)
New England (b)

6,149,687

51,703

.84

(39
)

—

Other

2,974,012

15,090

.51

(430
)

(.06
)
Total

$
22,724,417

$
234,175

1.03
%

$
(1,400
)

(.02
%)
Residential construction loans:

New York

$
19,608

$
3,421

17.45
%

$
—

—
%
Mid-Atlantic (a)

11,696

913

7.81

—

—

New England (b)

10,585

—

—

—

—

Other

4,743

—

—

—

—

Total

$
46,632

$
4,334

9.29
%

$
—

—
%
Limited documentation first lien mortgages:

New York

$
453,315

$
29,729

6.56
%

$
134

.11
%
Mid-Atlantic (a)

405,870

23,235

5.72

25

.02

New England (b)

91,876

9,694

10.55

—

—

Other

40,107

3,956

9.86

(2
)

(.02
)
Total

$
991,168

$
66,614

6.72
%

$
157

.06
%
First lien home equity loans and lines of
credit:

New York

$
914,405

$
17,288

1.89
%

$
(140
)

(.06
%)
Mid-Atlantic (a)

1,063,871

20,015

1.88

60

.02

New England (b)

506,062

3,943

.78

36

.03

Other

14,332

194

1.35

—

—

Total

$
2,498,670

$
41,440

1.66
%

$
(44
)

.01
%
Junior lien home equity loans and lines of
credit:

New York

$
755,274

$
16,096

2.13
%

$
(110
)

(.06
%)
Mid-Atlantic (a)

890,964

14,379

1.61

(357
)

(.16
)
New England (b)

607,772

4,951

.81

(47
)

(.03
)
Other

20,410

224

1.10

38

.76

Total

$
2,274,420

$
35,650

1.57
%

$
(476
)

(.08
%)

~~(a)~~

~~Includes Delaware, Maryland, New Jersey, Pennsylvania, Virginia, West Virginia and the District of Columbia.~~

~~(b)~~

~~Includes Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island and Vermont.~~

Real estate and other foreclosed assets totaled $43 million at June 30, 2023, compared with $29 million at June 30, 2022, $41 million at December 31, 2022 and $45 million at March 31, 2023. Net gains or losses associated with real estate and other foreclosed assets were not material during the three months ended June 30, 2023, June 30, 2022 and March 31, 2023. At June 30, 2023, foreclosed assets are comprised predominantly of residential real estate-related properties.

~~- 66 -~~

~~A comparative summary of nonperforming assets and certain past due loan data and credit quality ratios is presented in the accompanying table.~~

~~NONPERFORMING ASSET AND PAST DUE LOAN DATA~~

2023 Quarters

2022 Quarters

Second

First

Fourth

Third

Second

(Dollars in thousands)

Nonaccrual loans

$
2,435,581

2,556,799

2,438,435

2,429,326

2,633,005

Real estate and other foreclosed assets

42,720

44,567

41,375

37,031

28,692

Total nonperforming assets

$
2,478,301

2,601,366

2,479,810

2,466,357

2,661,697

Accruing loans past due 90 days or more

$
380,079

407,457

491,018

476,503

523,662

Government guaranteed loans included in totals above:

   Nonaccrual loans

$
39,846

42,102

43,536

44,797

46,937

   Accruing loans past due 90 days or more (a)

294,184

306,049

363,409

423,371

467,834

Nonaccrual loans to total loans and leases, net of
   unearned discount

1.83
%

1.92
%

1.85
%

1.89
%

2.05
%
Nonperforming assets to total net loans and
   leases and real estate and other foreclosed assets

1.86
%

1.96
%

1.88
%

1.92
%

2.07
%
Accruing loans past due 90 days or more to
   total loans and leases, net of unearned discount

.29
%

.31
%

.37
%

.37
%

.41
%

~~(a)~~

~~Predominantly residential real estate loans.~~

In establishing the allowance for credit losses, the Company estimates losses attributable to specific troubled credits identified through both normal and targeted credit review processes and also estimates losses for other loans and leases with similar risk characteristics on a collective basis. For purposes of determining the level of the allowance for credit losses, the Company evaluates its loan and lease portfolio by type. At the time of the Company’s analysis regarding the determination of the allowance for credit losses as of June 30, 2023 concerns existed about elevated levels of inflation; fears of liquidity shortages in the financial services markets and a slowing economy or possible recession in coming quarters; the volatile nature of global markets and international economic conditions that could impact the U.S. economy; Federal Reserve positioning of monetary policy; downward pressures on commercial and residential real estate values especially in the office and healthcare sectors; ongoing supply chain issues and wage pressures impacting commercial borrowers; the extent to which borrowers, in particular commercial real estate borrowers, may be negatively affected by general economic conditions; and continued stagnant population and economic growth in the upstate New York and central Pennsylvania regions (approximately 37% of the Company’s loans and leases are to customers in New York State and Pennsylvania) that historically lag other regions of the country. The Company utilizes a loan grading system to differentiate risk amongst its commercial loans and commercial real estate loans. Loans with a lower expectation of default are assigned one of ten possible “pass” loan grades while specific loans determined to have an elevated level of credit risk are classified as “criticized.” A criticized loan may be classified as “nonaccrual” if the Company no longer expects to collect all amounts according to the contractual terms of the loan agreement or the loan is delinquent 90 days or more. Criticized commercial loans and commercial real estate loans totaled $10.5 billion, including $2.2 billion of loans acquired from People's United, at June 30, 2023, compared with $11.6 billion, including $2.8 billion acquired from People's United at June 30, 2022, and $10.7 billion, including $2.5 billion of loans acquired from People's United, at December 31, 2022, and $10.6 billion, including $2.5 billion of loans acquired from People's United, at March 31, 2023. Despite improved economic conditions during 2022 as pandemic-related restrictions were lifted and consumer spending increased, the business climate through the first half of 2023 continues to be subjected to inflationary pressures, supply chain constraints, rising interest rates and liquidity concerns. The level of criticized loans remains reflective of the impact of current conditions on many borrowers, particularly those with investor-owned commercial real estate loans in the hotel, office,

~~- 67 -~~

retail and healthcare sectors. Investor-owned commercial real estate loans comprised $7.6 billion or 72% of total criticized loans at June 30, 2023. The weighted-average loan-to-value (“LTV”) ratio for investor-owned commercial real estate properties was approximately 56%. Criticized loans secured by investor-owned commercial real estate had a weighted-average LTV ratio of approximately 62%.Capital

The ~~accompanying tables summarize the outstanding balances of commercial loans and leases and commercial real estate loans by industry or property type at June 30, 2023 and December 31, 2022.~~

~~COMMERCIAL LOANS AND LEASES, NET OF UNEARNED DISCOUNT~~

~~(Excludes Loans Secured by Real Estate)~~

June 30, 2023

December 31, 2022

Outstanding

Criticized Accrual

Criticized Nonaccrual

Total Criticized

Outstanding

Criticized Accrual

Criticized Nonaccrual

Total Criticized

(In millions)

Financial and insurance

$
9,205

$
10

$
1

$
11

$
7,428

$
139

$
1

$
140

Services

6,691

312

34

346

6,494

333

35

368

Manufacturing

5,962

343

64

407

5,524

299

72

371

Motor vehicle and recreational
finance dealers

5,306

5

39

44

4,797

7

—

7

Wholesale

3,690

228

30

258

4,140

183

8

191

Transportation, communications, utilities

3,383

191

58

249

3,078

217

73

290

Retail

2,753

157

52

209

2,525

175

34

209

Construction

2,252

218

56

274

2,324

248

46

294

Real estate investors

1,703

31

2

33

1,882

35

3

38

Health services

1,990

281

40

321

1,972

171

39

210

Other

1,749

101

40

141

1,686

75

36

111

Total

$
44,684

$
1,877

$
416

$
2,293

$
41,850

$
1,882

$
347

$
2,229

~~COMMERCIAL REAL ESTATE LOANS, NET OF UNEARNED DISCOUNT~~

June 30, 2023

December 31, 2022

Outstanding

Criticized Accrual

Criticized Nonaccrual

Total Criticized

Outstanding

Criticized Accrual

Criticized Nonaccrual

Total Criticized

(In millions)

Investor-owned

Permanent finance by property type

Apartments/Multifamily

$
6,396

$
647

$
95

$
742

$
5,888

$
684

$
78

$
762

Retail/Service

6,054

839

246

1,085

6,296

971

182

1,153

Office

4,992

849

278

1,127

5,186

863

208

1,071

Health services

3,824

979

188

1,167

3,667

1,052

222

1,274

Hotel

2,825

615

357

972

2,810

676

512

1,188

Industrial/Warehouse

2,201

151

14

165

2,238

98

12

110

Other

363

4

12

16

527

42

24

66

               Total permanent

26,655

4,084

1,190

5,274

26,612

4,386

1,238

5,624

Construction/development

7,500

2,196

147

2,343

8,257

2,169

126

2,295

               Total investor-owned

34,155

6,280

1,337

7,617

34,869

6,555

1,364

7,919

Owner-occupied by industry (a)

Other services

2,263

153

68

221

2,253

168

69

237

Motor vehicle and recreational
   finance dealers

1,911

5

2

7

1,848

—

2

2

Retail

1,697

53

34

87

1,688

66

11

77

Health services

707

49

19

68

989

30

6

36

Wholesale

991

37

2

39

978

19

2

21

Real estate investors

904

45

21

66

732

50

23

73

Manufacturing

871

69

23

92

841

52

23

75

Other

1,150

28

24

52

1,167

49

23

72

               Total owner-occupied

10,494

439

193

632

10,496

434

159

593

Total commercial real estate

$
44,649

$
6,719

$
1,530

$
8,249

$
45,365

$
6,989

$
1,523

$
8,512

~~(a)~~

~~Includes $417 million and $359 million of construction loans at June 30, 2023 and December 31, 2022, respectively.~~

~~- 68 -~~

nonaccruing. For criticized nonaccrual loans, additional meetings are held with loan officers and their managers, workout specialists and senior management to discuss each of the relationships. In analyzing criticized loans, borrower-specific information is reviewed, including operating results, future cash flows, recent developments and the borrower’s outlook, and other pertinent data. The timing and extent of potential losses, considering collateral valuation and other factors, and the Company’s potential courses of action are contemplated.

With regard to residential real estate loans, the Company’s loss identification and estimation techniques make reference to loan performance and house price data in specific areas of the country where collateral securing the Company’s residential real estate loans is located. For residential real estate-related loans, including home equity loans and lines of credit, the excess of the loan balance over the net realizable value of the property collateralizing the loan is charged-off when the loan becomes 150 days delinquent. That charge-off is based on recent indications of value from external parties that are generally obtained shortly after a loan becomes nonaccrual. Loans to consumers that file for bankruptcy are generally charged off to estimated net collateral value shortly after the Company is notified of such filings. At June 30, 2023, approximately 52% of the Company’s home equity portfolio consisted of first lien loans and lines of credit and 48% were junior liens. With respect to junior lien loans, to the extent known by the Company, if a related senior lien loan would be on nonaccrual status because of payment delinquency, even if such senior lien loan was not owned by the Company, the junior lien loan or line that is owned by the Company is placed on nonaccrual status. In monitoring the credit quality of its home equity portfolio for purposes of determining the allowance for credit losses, the Company reviews delinquency and nonaccrual information and considers recent charge-off experience. When evaluating individual home equity loans and lines of credit for charge off and for purposes of determining the allowance for credit losses, the Company gives consideration to the required repayment of any first lien positionsfollowing table presents components related to ~~collateral property. Home~~shareholders' equity line of credit terms vary but such lines are generally originated with an open draw period of ten years followed by an amortization period of up to twenty years. At June 30, 2023 approximately 86% of all outstanding balances of home equity lines of credit related to lines that were still in the draw period, the weighted-average remaining draw periods were approximately five years, and ~~approximately 16% were making contractually allowed payments that do not include any repayment of principal.~~

The Company generally estimates current expected credit losses on loans with similar risk characteristics on a collective basis. To estimate expected losses, the Company utilizes statistically developed models to project principal balances over the remaining contractual lives of the loan portfolios and determine estimated credit losses through a reasonable and supportable forecast period. The Company’s approach for estimating current expected credit losses for loans and leases at June 30, 2023, March 31, 2023, December 31, 2022 and June 30, 2022 included utilizing macroeconomic assumptions to project losses over a two-year reasonable and supportable forecast period. Subsequent to the forecast period, the Company reverted to longer-term historical loss experience, over a period of one year, to estimate expected credit losses over the remaining contractual life. Forward-looking estimates of certain macroeconomic variables are determined by the M&T Scenario Development Group, which is comprised of senior management business leaders and economists. Events posing emerging risks to the macroeconomic environment, such as international conflicts and other events, liquidity concerns, inflation and supply chain issues, are considered when developing economic forecasts even if the events do not directly and materially impact the Company’s financial results. Supply chain disruptions, inflationary pressures, liquidity trends or other peripheral impacts of global events may alter economic forecasts and the Company monitors this activity as part of its risk management procedures in assessing the allowance for credit losses. Among the assumptions utilized as of June 30, 2023 was that the national unemployment rate will average 4.6% through the reasonable and supportable forecast period. The forecast also assumed gross domestic product grows at a 0.8% average rate during the first year of the reasonable and supportable forecast period

~~- 69 -~~

and at a 2.3% average rate in the second year. Commercial real estate and residential real estate prices were assumed to cumulatively contract 11.1% and 6.6%, respectively over the two-year reasonable and supportable forecast period. The assumptions utilized as of March 31, 2023 included an average national unemployment rate of 4.4% through the reasonable and supportable forecast period. The forecast also assumed gross domestic product would grow 1.0% during the first year of the reasonable and supportable forecast period followed by 2.4% in the second year. Commercial real estate prices were assumed to cumulatively contract 5.5% and residential real estate prices were assumed to contract 6.7% over the two-year reasonable and supportable forecast period. The assumptions utilized as of December 31, 2022 included an average national unemployment rate of 4.0% through the reasonable and supportable forecast period. The forecast also assumed gross domestic product would grow during the first year of the reasonable and supportable period at a 1.0% average annual rate followed by a 2.5% average rate in the second year. Commercial real estate prices were assumed to cumulatively grow 1.9% and residential real estate prices were assumed to contract 6.2% over the two-year reasonable and supportable forecast period. Among the assumptions utilized as of June 30, 2022 was that the national unemployment rate would average 3.4% through the reasonable and supportable forecast period. The forecast also assumed gross domestic product would grow at a 2.4% average rate during the first year of the reasonable and supportable forecast period and at a 2.9% average rate in the second year. Commercial real estate and residential real estate prices were assumed to cumulatively grow 11.6% and 0.4%, respectively, over the two-year reasonable and supportable forecast period. The assumptions utilized were based on the information available to the Company at or near June 30, 2023, March 31, 2023, December 31, 2022 and June 30, 2022 (at the time the Company was preparing its estimate of expected credit losses as of those dates).

In establishing the allowance for credit losses, the Company also considers the impact of portfolio concentrations, imprecision in economic forecasts, geopolitical conditions and other risk factors that might influence the loss estimation process. With respect to economic forecasts, the Company assessed the likelihood of alternative economic scenarios during the two-year reasonable and supportable time period. Generally, an increase in unemployment rate or a decrease in any of the rate of change in gross domestic product, commercial real estate prices or home prices could have an adverse impact on expected credit losses and may result in an increase to the allowance for credit losses. Forward looking economic forecasts are subject to inherent imprecision and future events may differ materially from forecasted events. In consideration of such uncertainty, the following alternative economic scenarios were considered to estimate the possible impact on modeled credit losses.

A potential downside economic scenario assumed the unemployment rate averages 7.1% in the reasonable and supportable forecast period. The scenario also assumed gross domestic product contracts 2.2% in the first year of the reasonable and supportable forecast period before recovering to 1.8% growth in the second year and commercial real estate and residential real estate prices cumulatively decline 27.4% and 15.0%, respectively, by the end of the reasonable and supportable forecast period.

A potential upside economic scenario assumed the unemployment rate averages approximately 3.3% for the duration of the reasonable and supportable forecast period. The scenario also assumes gross domestic product grows 3.3% in the initial year of the reasonable and supportable forecast period and 2.4% in the second year while commercial real estate prices cumulatively decline 3.2% and residential real estate prices cumulatively rise 0.5% over the two-year reasonable and supportable forecast period.

The scenario analyses resulted in an additional $471 million of modeled credit losses under the assumptions of the downside economic scenario, whereas under the assumptions of the upside economic scenario a $210 million reduction in modeled credit losses could occur. These examples are only a few of the numerous possible economic scenarios that could be utilized in assessing the sensitivity of expected credit losses. The estimated impacts on credit losses in such scenarios pertain only to modeled credit losses and do not include consideration of other factors the Company may evaluate when determining its allowance for credit losses.

As a result, it is possible that the Company may, at another point in time, reach different conclusions regarding credit loss estimates. The Company’s process for determining the allowance for credit losses undergoes quarterly and periodic evaluations by independent risk management personnel, which among many other considerations, evaluate the reasonableness of management’s methodology and significant assumptions. Further information about the Company’s methodology to estimate expected credit losses is included in note 4 of Notes to Financial Statements.

~~- 70 -~~

Management believes that the allowance for credit losses at June 30, 2023 appropriately reflected expected credit losses inherent in the portfolio as of that date. The allowance for credit losses totaled $2.00 billion at June 30, 2023, compared with $1.82 billion at June 30, 2022, $1.93 billion at December 31, 2022 and $1.98 billion at March 31, 2023. As a percentage of loans outstanding, the allowance was 1.50% at June 30, 2023, 1.42% at June 30, 2022, 1.46% at December 31, 2022 and 1.49% at March 31, 2023. Using the same methodology described herein, the Company added $341 million to the allowance for credit losses related to the $35.8 billion of loans and leases obtained in the acquisition of People's United on April 1, 2022. Macroeconomic assumptions used to estimate credit losses on loans acquired from People's United were consistent with those used by the Company to estimate credit losses at March 31, 2022. The combined Company allowance for credit losses at April 1, 2022 as a percentage of loans outstanding was 1.42%. The level of the allowance reflects management’s evaluation of the loan and lease portfolio using the methodology and considering the factors as described herein. Should the various economic forecasts and credit factors considered by management in establishing the allowance for credit losses change and should management’s assessment of losses in the loan portfolio also change, the level of the allowance as a percentage of loans could increase or decrease in future periods. The reported level of the allowance reflects management’s evaluation of the loan and lease portfolio as of each respective date.

The ratio of the allowance for credit losses to total nonaccrual loans at June 30, 2023, June 30, 2022, December 31, 2022 and March 31, 2023 was 82%, 69%, 79% and 77%, respectively. Given the Company’s general position as a secured lender and its practice of charging off loan balances when collection is deemed doubtful, that ratio and changes in the ratio are generally not an indicative measure of the adequacy of the Company’s allowance for credit losses, nor does management rely upon that ratio in assessing the adequacy of the Company’s allowance for credit losses.

~~Other Income~~

Other income totaled $803 million in the second quarter of 2023, improved from $571 million in the year-earlier quarter and $587 million in the first quarter of 2023. For the first six months of 2023, other revenues totaled $1.39 billion compared with $1.11 billion for the similar 2022 period. The three-month and six-month periods ended June 30, 2023 reflect a $225 million gain on sale of the CIT business. The components of other income are presented in the accompanying table.

Three Months Ended

Six Months Ended

June 30, 2023

June 30, 2022

March 31, 2023

June 30, 2023

June 30, 2022

(In thousands)

Mortgage banking revenues

$
107,112

$
82,926

$
84,985

$
192,097

$
192,074

Service charges on deposit accounts

118,697

124,170

113,546

232,243

225,677

Trust income

172,463

190,084

193,802

366,265

359,297

Brokerage services income

25,126

24,138

24,041

49,167

44,328

Trading account and non-hedging derivative gains

16,754

2,293

11,675

28,429

7,662

Gain (loss) on bank investment securities

1,004

(62
)

(416
)

588

(805
)
Other revenues from operations

362,015

147,551

159,500

521,515

283,754

Total other income

$
803,171

$
571,100

$
587,133

$
1,390,304

$
1,111,987

Mortgage banking revenues were $107 million in the second quarter of 2023, compared with $83 million in the second quarter of 2022 and $85 million in the first quarter of 2023. Mortgage banking revenues are comprised of both residential and commercial mortgage banking activities. The Company’s involvement in commercial mortgage banking activities includes the origination, sales and servicing of loans under the multifamily loan programs of Fannie Mae, Freddie Mac and the U.S. Department of Housing and Urban Development.

Residential mortgage banking revenues, consisting of realized gains and losses from sales of residential real estate loans and loan servicing rights, unrealized gains and losses on residential real estate loans held for sale and related commitments, residential real estate loan servicing fees, and other residential real estate loan-related fees and income, were $77 million in the second quarter of 2023, $50 million in the similar quarter of 2022 and $55 million in the first quarter of 2023. That income reflects gains associated with residential mortgage loans originated for sale and loan servicing of $8 million and $69 million, respectively, in the recent quarter and $3 million and $52 million,

~~- 71 -~~

respectively, in the first quarter of 2023, compared with losses on residential mortgage loans originated for sale of $17 million and income from loan servicing of $67 million in the year earlier quarter.

Throughout 2022, the Company originated the majority of its residential real estate loans for retention in its loan portfolio rather than for sale. However, in the first quarter of 2023 the Company returned to originating for sale the majority of its newly originated residential mortgage loans. New commitments to originate residential real estate loans to be sold were approximately $395 million in the second quarter of 2023, compared with $78 million in the year-earlier quarter and $276 million in the first quarter of 2023. Loans held for sale that were secured by residential real estate aggregated $216 million at June 30, 2023, $65 million at June 30, 2022 and $32 million at December 31, 2022. Commitments to sell residential real estate loans and commitments to originate residential real estate loans for sale at pre-determined rates totaled $393 million and $243 million, respectively, at June 30, 2023, compared with $84 million and $69 million, respectively, at June 30, 2022 and $53 million and $31 million, respectively, at December 31, 2022. Net recognized unrealized gains on residential real estate loans held for sale, commitments to sell loans, and commitments to originate loans for sale were $7 million at June 30, 2023 and less than $1 million at June 30, 2022, compared with net recognized unrealized losses of $1 million at December 31, 2022. Changes in net unrealized gains or losses are recorded in mortgage banking revenues and resulted in a net increase in revenues of $4 million in the recent quarter and $2 million in the first quarter of 2023, compared with a net decrease of $5 million in the second quarter of 2022.

Revenues from servicing residential real estate loans for others were $69 million during the quarter ended June 30, 2023, compared with $67 million and $52 million during the three months ended June 30, 2022 and March 31, 2023, respectively. The higher revenues from servicing residential real estate loans in the recent quarter as compared with the first quarter of 2023 reflect a $350 million bulk purchase of residential mortgage loan servicing rights associated with $19.5 billion of residential real estate loans on March 31, 2023. The increase in revenues in the recent quarter as compared with the year-earlier quarter also reflects that bulk purchase of residential mortgage loan servicing rights, partially offset by lower sub-servicing fees on modified loans with improved performance as compared with the year-earlier period. Residential real estate loans serviced for others totaled $153.7 billion at June 30, 2023, $102.5 billion at June 30, 2022 and $118.4 billion at December 31, 2022. Loans sub-serviced for others that were included in residential real estate loans serviced for others were $112.8 billion, $79.0 billion and $96.0 billion at June 30, 2023, June 30, 2022 and December 31, 2022, respectively. Revenues earned for sub-servicing loans totaled $32 million during each of the recent quarter and the first quarter of 2023, compared with $44 million in the second quarter of 2022. The decrease in sub-servicing fees in the two most recent quarters as compared with the second quarter of 2022 reflects lower fees associated with modifying and selling reperforming loans previously repurchased by the holder of the contractual servicing rights. The contractual servicing rights associated with loans sub-serviced by the Company were predominantly held by affiliates of Bayview Lending Group LLC ("BLG"). Information about the Company’s relationship with BLG and its affiliates is included in note 15 of Notes to Financial Statements. Capitalized residential mortgage servicing assets totaled $505 million at June 30, 2023, $215 million at June 30, 2022 and $194 million at December 31, 2022. The higher balance of capitalized mortgage servicing rights at June 30, 2023 as compared with June 30, 2022 and December 31, 2022 reflects the bulk purchase of residential mortgage loan servicing rights described herein.

Commercial mortgage banking revenues totaled $30 million in each of the second quarter of 2023 and the first quarter of 2023, compared with $33 million in the second quarter of 2022. Included in such amounts were revenues from loan origination and sales activities of $13 million in the second quarter of 2023, $14 million in the second quarter of 2022 and $15 million in the first quarter of 2023. Commercial real estate loans originated for sale to other investors were $940 million in the recent quarter, compared with $692 million in the second quarter of 2022 and $672 million in the first quarter of 2023. Loan servicing revenues totaled $17 million and $19 million in the second quarters of 2023 and 2022, respectively, compared with $15 million in the first quarter of 2023. Capitalized commercial mortgage servicing assets were $124 million and $130 million at June 30, 2023 and June 30, 2022, respectively, and $126 million at December 31, 2022. Commercial real estate loans serviced for other investors totaled $26.9 billion at June 30, 2023, $24.4 billion at June 30, 2022 and $26.0 billion at December 31, 2022. Those servicing amounts included $3.9 billion at each of June 30, 2023, June 30, 2022 and December 31, 2022 of loan balances for which investors had recourse to the Company if such balances are ultimately uncollectable. Included in commercial real estate loans serviced for others

~~- 72 -~~

were loans sub-serviced for others of $3.8 billion at each of June 30, 2023 and December 31, 2022, compared with $3.6 billion at June 30, 2022. Commitments to sell commercial real estate loans and commitments to originate commercial real estate loans for sale were $632 million and $310 million, respectively, at June 30, 2023, $824 million and $569 million, respectively, at June 30, 2022 and $480 million and $349 million, respectively, at December 31, 2022. Commercial real estate loans held for sale at June 30, 2023, June 30, 2022 and December 31, 2022 were $322 million, $255 million and $131 million, respectively.

Service charges on deposit accounts were $119 million and $124 million in the second quarter of 2023 and 2022, respectively, compared with $114 million in the first quarter of 2023. The decline in the recent quarter as compared with the year-earlier quarter reflects a full quarter impact of the Company's planned elimination of certain non-sufficient funds fees and overdraft protection transfer charges from linked deposit accounts beginning in the second quarter of 2022. The $5 million increase in service charges on deposit accounts from the first quarter of 2023 reflects $3 million of increased commercial service charges and higher consumer service charges of $2 million.

Trust income includes fees related to two businesses. The Institutional Client Services (“ICS”) business provides a variety of trustee, agency, investment management and administrative services for corporations and institutions, investment bankers, corporate tax, finance and legal executives, and other institutional clients who: (i) use capital markets financing structures; (ii) use independent trustees to hold retirement plan and other assets; and (iii) need investment and cash management services. The Wealth Advisory Services (“WAS”) business offers personal trust, planning, fiduciary, asset management, family office and other services designed to help high net worth individuals and families grow, preserve, and transfer wealth. Trust income aggregated $172 million in the second quarter of 2023, compared with $190 million in the year-earlier quarter and $194 million in the first quarter of 2023. Revenues associated with the ICS business were $91 million, $109 million and $120 million during the quarters ended June 30, 2023, June 30, 2022 and March 31, 2023, respectively. In April 2023 M&T completed the divestiture of its CIT business through a sale to a private equity firm. The resulting decline in trust income associated with that business was $25 million and $31 million, respectively, when compared with 2022's second quarter and the first quarter of 2023. Higher money market fees on new and existing business partially offset the decline in CIT-related trust income as compared with the second quarter of 2022. Revenues attributable to the WAS business totaled $79 million in the three-month period ended June 30, 2023 and $78 million during the quarter ended June 30, 2022. Revenues from the WAS business were $73 million in the quarter ended March 31, 2023. The increase from the initial quarter of 2023 reflected seasonal tax service fees of $4 million. Reflective of the divestiture of the CIT business, trust assets under management declined to $78.5 billion at June 30, 2023 from $151.8 billion and $165.2 billion at June 30, 2022 and December 31, 2022, respectively. Trust assets under management include the Company’s proprietary mutual funds’ assets of $14.1 billion, $11.9 billion and $13.0 billion at June 30, 2023, June 30, 2022 and December 31, 2022, respectively. Additional trust income from investment management activities comprised of fees earned from retail customer investment accounts was $2 million in the second quarter of 2023, $3 million in the corresponding quarter of 2022, and $1 million in the first quarter of 2023.

Brokerage services income, which includes revenues from the sale of mutual funds and annuities, securities brokerage fees and select investment products of LPL Financial totaled $25 million in the second quarter of 2023 and $24 million in each of the second quarter of 2022 and the first quarter of 2023. Trading account and other non-hedging derivative activity resulted in gains of $17 million, $2 million and $12 million during the quarters ended June 30, 2023, June 30, 2022 and March 31, 2023, respectively. The increase in trading account and other non-hedging derivative gains in the recent quarter as compared with the year-earlier quarter and the first quarter of 2023 reflects higher revenues from interest rate swap agreements with commercial customers and comparative gains on assets related to the Company's supplemental executive retirement plans in the recent quarter. Information about the notional amount of interest rate, foreign exchange and other contracts entered into by the Company is included in note 10 of Notes to Financial Statements and herein under the heading “Taxable-equivalent Net Interest Income.” There were no significant net gains or losses on investment securities in each of the second quarter of 2023, the second quarter of 2022 and the first quarter of 2023.

Other revenues from operations were $362 million in the second quarter of 2023, compared with $148 million in the corresponding 2022 period and $160 million in the first quarter of 2023. A $225 million gain on the sale of CIT

~~- 73 -~~

was recorded in the second quarter of 2023. Also included in other revenues from operations were the following significant components. Letter of credit and other credit-related fees aggregated $48 million in the recent quarter, compared with $38 million in the year-earlier quarter and $43 million in the first quarter of 2023. The higher revenues in the two most recent quarters as compared with 2022's second quarter reflect higher loan syndication fees. Revenues from merchant discount and credit card fees were $45 million in each of the second quarter of 2023 and 2022, compared with, $39 million in the first quarter of 2023. The lower merchant discount and credit card fees in the first quarter of 2023 as compared with the recent quarter and 2022's second quarter is reflective of seasonal declines in customer activity. Tax-exempt income from bank owned life insurance, which includes changes in the cash surrender value of life insurance policies and benefits received, totaled $14 million in each of the second quarter of 2023 and 2022, compared with $13 million in the first quarter of 2023. Insurance-related sales commissions and other revenues declined to $5 million in the quarter ended June 30, 2023 and $4 million in the first quarter of 2023 from $14 million in the second quarter of 2022 due to the sale of M&T Insurance Agency ("MTIA") in the fourth quarter of 2022. M&T received distributions as a result of its investment in BLG of $20 million in the first quarter of 2023. There was no similar distribution in the second quarter of 2023 or 2022.

Other income totaled $1.39 billion during the first six months of 2023, up from $1.11 billion during the year-earlier period. The increase as compared with the first half of 2022 was predominantly due to the gain on sale of the CIT business in April 2023 and the impact of one additional quarter of People's United-related revenues in the first half of 2023. Those positive factors were partially offset by a decrease in revenues resulting from the sales of the CIT business in April 2023 and of MTIA in October 2022 and from lower distributions from the Company's investment in BLG in the first half of 2023 as compared with the corresponding 2022 period.

Mortgage banking revenues totaled $192 million in each of the first six months of 2023 and 2022. Residential mortgage banking revenues aggregated $132 million and $126 million during the six-month periods ended June 30, 2023 and 2022, respectively. New commitments to originate residential real estate loans to be sold aggregated $671 million and $239 million in the initial six months of 2023 and 2022, respectively. Realized gains from sales of residential real estate loans and loan servicing rights and recognized unrealized gains and losses on residential real estate loans held for sale, commitments to originate loans for sale and commitments to sell loans aggregated to gains of $11 million in the first six months of 2023, compared with losses of $3 million in the first six months of 2022. The increase in volume and revenues reflect the Company’s decision in the first quarter of 2023 to return to selling the majority of recently originated residential mortgage loans rather than retaining such loans in its own portfolio. Revenues from servicing residential real estate loans for others were $121 million in the first half of 2023 and $129 million in the corresponding 2022 period. Included in servicing revenues were sub-servicing revenues aggregating $64 million and $86 million in the first six months of 2023 and 2022, respectively. For the six months ended June 30, commercial mortgage banking revenues were $60 million and $66 million in 2023 and 2022, respectively. Commercial real estate loans originated for sale to other investors totaled $1.6 billion and $1.3 billion during the six-month periods ended June 30, 2023 and 2022, respectively.

Service charges on deposit accounts aggregated $232 million during the first six months of 2023, compared with $226 million in the year-earlier period. Trust income totaled $366 million and $359 million during the first six months of 2023 and 2022, respectively. The increase in trust income in 2023 as compared with 2022, despite two less months of CIT-related trust income as a result of the sale of that business in April 2023, was largely due to the impact of one additional quarter of revenues associated with the People's United acquisition. Brokerage services income totaled $49 million in the first six months of 2023, compared with $44 million in the six-month period ended June 30, 2022. Trading account and non-hedging derivative gains were $28 million and $8 million, respectively, for the six-months ended June 30, 2023 and 2022, reflecting higher revenues from interest rate swap agreements with commercial customers and comparative gains on assets related to the Company's supplemental executive retirement plans in the first half of 2023. There were no significant net gains or losses on investment securities recognized during the first six months of 2023 and 2022.

Other revenues from operations totaled $522 million in the first six months of 2023, compared with $284 million in the year-earlier period. Other revenues from operations in the most recent six months include the $225 million gain on the sale of the CIT business. Other revenues from operations also include the following significant components.

~~- 74 -~~

Letter of credit and other credit-related fees aggregated $91 million and $65 million in 2023 and 2022, respectively. The higher level of revenues in the recent period reflects higher loan syndication and line usage fees. Merchant discount and credit card fees were $84 million and $79 million in the first six months of 2023 and 2022, respectively. Income from bank owned life insurance totaled $27 million in the first six months of 2023, compared with $24 million in the corresponding 2022 period. Insurance-related commissions and other revenues aggregated $9 million and $29 million in the first six months of 2023 and 2022, respectively. The comparative decline reflects the sale of MTIA in October 2022. M&T’s investment in BLG resulted in income of $20 million in the first six months of 2023 and $30 million in the first half of 2022.

~~Other Expense~~

Other expense totaled $1.29 billion in the second quarter of 2023, compared with $1.40 billion in the year-earlier quarter and $1.36 billion in the first quarter of 2023. Included in those amounts are expenses considered to be “nonoperating” in nature consisting of amortization of core deposit and other intangible assets of $15 million in the recent quarter, $18 million in the second quarter of 2022 and $17 million in the first 2023 quarter, and merger-related expenses of $223 million in the second quarter of 2022. There were no merger-related expenses during the first and second quarters of 2023. Exclusive of those nonoperating expenses, noninterest operating expenses were $1.28 billion in the recent quarter, compared with $1.16 billion in the year-earlier quarter and $1.34 billion in the first quarter of 2023. Other expense for the first half of 2023 totaled $2.65 billion, compared with $2.36 billion in the year-earlier period. Included in those amounts are expenses considered to be “nonoperating” in nature consisting of amortization of core deposit and other intangible assets of $32 million and $20 million in the six-month periods ended June 30, 2023 and 2022, respectively, and merger-related expenses of $240 million during 2022's first half. There were no merger-related expenses recognized in 2023. Exclusive of those nonoperating expenses, noninterest operating expenses for the first half of 2023 were $2.62 billion, compared with $2.10 billion in the first six months of 2022. Table 2 provides a reconciliation of other expense to noninterest operating expense. The components of other expense are presented in the accompanying table.

Three Months Ended

Six Months Ended

June 30, 2023

June 30, 2022

March 31,
2023

June 30, 2023

June 30,
2022

(In thousands)

Salaries and employee benefits

$
737,665

776,201

807,942

1,545,607

1,353,721

Equipment and net occupancy

128,689

124,655

126,904

255,593

210,467

Outside data processing and software

106,438

93,820

105,780

212,218

173,539

FDIC assessments

27,932

22,585

29,758

57,690

38,161

Advertising and marketing

28,353

20,635

31,063

59,416

36,659

Printing, postage and supplies

14,199

15,570

14,183

28,382

25,720

Amortization of core deposit and other intangible assets

14,945

18,384

17,208

32,153

19,640

Other costs of operations

234,338

331,304

226,392

460,730

504,988

Total other expense

$
1,292,559

1,403,154

1,359,230

2,651,789

2,362,895

Salaries and employee benefits expense totaled $738 million in the second quarter of 2023, compared with $776 million in the year-earlier quarter and $808 million in the first quarter of 2023. Excluding the nonoperating expense items described earlier, salaries and employee benefits expense totaled $691 million in the second quarter of 2022. The increase in salaries and employee benefits operating expense in the recent quarter as compared with the second quarter of 2022 reflects the impact of higher employee staffing levels and merit increases. Comparing the recent quarter with the first quarter of 2023, the effect of seasonally higher stock-based compensation, medical plan costs, payroll-related taxes and unemployment insurance that totaled $99 million in the initial 2023 quarter was partially offset by the full quarter impact of annual merit increases, higher average staffing levels and higher severance expense. During the first six months of 2023 and 2022, salaries and employee benefits expense aggregated $1.55 billion and $1.35 billion, respectively. Excluding nonoperating expenses described herein, salaries and employee benefits operating expense in the first half of 2022 totaled $1.27 billion. The higher operating expense level in 2023 largely reflects the addition of People's United employees at the beginning of the second quarter of 2022 and higher salaries resulting from an increase in legacy staffing levels, annual merit increases and a rise in incentive compensation, including stock-based compensation. The Company, in accordance with GAAP, has accelerated the recognition of compensation costs

~~- 75 -~~

for stock-based awards. As a result, stock-based compensation expense during the first quarters of 2023 and 2022 included $41 million and $36 million, respectively, that would have been recognized over the normal vesting period if not for the accelerated recognition provisions of GAAP. That acceleration had no effect on the value of stock-based compensation awarded to employees. Salaries and employee benefits expense included stock-based compensation of $19 million, $23 million and $62 million in the three-month periods ended June 30, 2023, June 30, 2022 and March 31, 2023, respectively, and $81 million and $73 million during the six-month periods ended June 30, 2023 and 2022, respectively. The number of full-time equivalent employees was 22,946 at June 30, 2023, compared with 22,680 and 23,004 at June 30, 2022 and March 31, 2023, respectively.

Excluding the nonoperating expense items described earlier from each quarter, nonpersonnel operating expenses were $540 million, $471 million and $534 million in the quarters ended June 30, 2023, June 30, 2022 and March 31, 2023, respectively. On that same basis, such expenses were $1.07 billion and $835 million in the six-month periods ended June 30, 2023 and 2022, respectively. The increase in the recent quarter as compared with the second quarter of 2022 reflects increases in outside data processing and software costs, expenses related to the bulk purchase of residential mortgage loan servicing rights at the end of the first quarter of 2023 and check fraud losses, partially offset by a decline in professional and outside services expenses reflecting a decline in sub-advisory fees resulting from the sale of the CIT business in April 2023. The rise in non-personnel operating expenses in 2023’s second quarter as compared with 2023’s first quarter reflected an increase in expenses related to the bulk purchase of residential mortgage loan servicing rights, partially offset by a decline in professional services expenses primarily driven by a decline in sub-advisory fees resulting from the sale of the CIT business. In addition to the impact of an additional quarter of nonpersonnel operating expenses in 2023 associated with the People's United acquisition, the year-over-year increase reflects higher professional and outside services expenses, outside data processing and software costs, check fraud losses, deposit insurance and advertising and marketing costs.

On May 11, 2023, the Federal Deposit Insurance Corporation (“FDIC”) released a proposed rule that would impose a special assessment to recover the costs to the deposit insurance fund (“DIF”) resulting from the FDIC’s use, in March 2023, of the systemic risk exception in connection with the receiverships of Silicon Valley Bank and Signature Bank. Under the proposed rule, the assessment base would be the estimated uninsured deposits of an insured depository institution at December 31, 2022, excluding the first $5 billion of those estimated uninsured deposits. The special assessments would be collected at an annual rate of approximately 12.5 basis points per year (3.13 basis points per quarter) over eight quarters in 2024 and 2025, with the first assessment period beginning January 1, 2024. Under the proposed rule, the estimated loss pursuant to the systemic risk determination may be periodically adjusted by the FDIC. M&T expects the special assessments, as currently contemplated, would be tax deductible. Although the proposal could be revised, the total of the assessments for the Company is estimated at $183 million and such amount is expected to be recorded as an expense in the quarter of enactment. Such expense would significantly affect noninterest expense and results of operations for that future quarter. Refer to note 13 of Notes to Financial Statements for additional information on the FDIC special assessment.

The efficiency ratio, or noninterest operating expenses divided by the sum of taxable-equivalent net interest income and noninterest income (exclusive of gains and losses from bank investment securities), measures the relationship of noninterest operating expenses to revenues. The Company’s efficiency ratio was 48.9% during the recent quarter, compared with 58.3% and 55.5% in the second quarter of 2022 and first quarter of 2023, respectively. The efficiency ratios for the six-month periods ended June 30, 2023 and 2022 were 52.0% and 61.1%, respectively.

~~Income Taxes~~

Income tax expense was $293 million in the second quarter of 2023, compared with $60 million in the year-earlier quarter and $225 million in the first quarter of 2023. For the six-month periods ended June 30, 2023 and 2022, the provisions for income taxes were $517 million and $173 million, respectively. The effective tax rates were 25.2%, 21.7% and 24.2% for the quarters ended June 30, 2023, June 30, 2022 and March 31, 2023, respectively, and 24.8% and 23.0% for the six-month periods ended June 30, 2023 and 2022, respectively.

The effective tax rate is affected by the level of income earned that is exempt from tax relative to the overall level of pre-tax income, the amount of income allocated to the various state and local jurisdictions where the Company operates, because tax rates differ among such jurisdictions, and the impact of any large discrete or infrequently

~~- 76 -~~

occurring items. The Company’s effective tax rate in future periods will also be affected by any change in income tax laws or regulations and interpretations of income tax regulations that differ from the Company’s interpretations by any of various tax authorities that may examine tax returns filed by M&T or any of its subsidiaries.

~~Capital~~

Shareholders’ equity was $25.8 billion at June 30, 2023, representing 12.42% of total assets, compared with $25.8 billion or 12.64% a year earlier and $25.3 billion or 12.61% at December 31, 2022. Shareholders' equity at each of the respective quarter ends reflects the issuance of 50,325,004 M&T common shares and other common equity consideration totaling $8.4 billion for the acquisition of People's United and the conversion of People's United preferred stock into 10,000,000 shares of Series H Perpetual Fixed-to-Floating Rate Non-cumulative Preferred Stock of M&T ("Series H Preferred Stock") amounting to $261 million on April 1, 2022. Included in shareholders’ equity was preferred stock with financial statement carrying values of $2.01 billion at each of June 30, 2023, December 31, 2022 and June 30, 2022.

Common shareholders’ equity was $23.8 billion, or $143.41 per share, at June 30, 2023, compared with $23.8 billion, or $135.16 per share, a year earlier and $23.3 billion, or $137.68 per share, at December 31, 2022. Tangible equity per common share, which excludes goodwill and core deposit and other intangible assets and applicable deferred tax balances, was $91.58 at the end of the recent quarter, compared with $85.78 at June 30, 2022 and $86.59 at December 31, 2022. The Company’s ratio of tangible common equity to tangible assets was 7.63% at each of June 30, 2023 and December 31, 2022, as compared with 7.73% at June 30, 2022.dividends. Reconciliations of total common shareholders’ equity and tangible common equity and total assets and tangible assets as of each of those dates are presented in ~~table~~Table 2.

SHAREHOLDERS' EQUITY, DIVIDENDS AND SELECT RATIOS


(Dollars in millions, except per share)	March 31, 2024			December 31, 2023			March 31, 2023
Shareholders' equity	$	27,169		$	26,957		$	25,377
Preferred stock		(2,011	)		(2,011	)		(2,011	)
Common shareholders' equity	$	25,158		$	24,946		$	23,366
Per share:
Common shareholders’ equity	$	150.90		$	150.15		$	140.88
Tangible common shareholders’ equity		99.54			98.54			88.81
Ratios:
Shareholder's equity to total assets		12.63	%		12.94	%		12.50	%
Tangible common shareholders' equity to tangible assets		8.03			8.20			7.58
Cash dividends declared for quarter ended:
Common stock	$	218		$	217		$	219
Common stock per share		1.30			1.30			1.30
Preferred stock		25			25			25

Shareholders’ equity reflects accumulated other comprehensive income or loss, which includes the net after-tax impact of unrealized gains or losses on investment securities classified as available for sale, ~~remaining unrealized losses on held-to-maturity securities transferred from available for sale that have not yet been amortized,~~ gains or losses associated with interest rate swap agreements designated as cash flow hedges ~~foreign currency translation adjustments~~ and adjustments to reflect the funded status of defined benefit pension and other postretirement plans. ~~Net unrealized losses on investment securities reflected~~The components of other comprehensive income (loss) are presented in shareholders’ equity, net of applicable tax effect, were $328 million or $1.98 per common share at June 30, 2023, $129 million or $.73 per common share at June 30, 2022 and $329 million, or $1.94 per common share, at December 31, 2022. Changes in unrealized gains and losses on investment securities are predominantly reflective of the ~~impact of changes in interest rates on the values of such securities. Information about unrealized gains and losses on investment securities as of June 30, 2023 and December 31, 2022 is included in~~following table.

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) - NET OF INCOME TAX


	March 31,			December 31,			March 31,
(Dollars in millions, except per share)	2024			2023			2023
Investment securities unrealized losses, net (a)	$	(197	)	$	(187	)	$	(264	)
Cash flow hedges unrealized losses, net (b)		(268	)		(151	)		(169	)
Defined benefit plans adjustments, net (c)		(116	)		(115	)		(204	)
Other, net		(8	)		(6	)		(8	)
Total	$	(589	)	$	(459	)	$	(645	)

Accumulated other comprehensive income (loss), net, per common share	$	(3.53	)	$	(2.76	)	$	(3.89	)

(a)

Refer to note 3 of Notes to Financial Statements.

(b)

Refer to note 10 of Notes to Financial Statements.

(c)

Refer to note 7 of Notes to Financial Statements.

Reflected in the carrying amount of available-for-sale investment securities at ~~June 30, 2023~~March 31, 2024 were pre-tax effect unrealized gains of ~~$234 thousand on securities with an amortized cost of $32 million and pre-tax effect unrealized losses of $441~~$1 million on securities with an amortized cost of ~~$11.2~~$622 million and pre-tax effect unrealized losses of $264 million on securities with an amortized cost of $11.8 billion. Information concerning the Company’s fair valuations of investment securities is provided in notes 3 and 12 of Notes to Financial Statements.

~~Each reporting period the Company reviews its available-for-sale investment securities for declines~~ As also described in ~~value that might be indicative~~note 3 of ~~credit-related losses through an analysis of the creditworthiness of the issuer or the credit performance of the underlying collateral supporting the bond. If~~Notes to Financial Statements, the Company does not expect any material credit-related losses with respect to recover the entire amortized cost basis of a debt security a credit loss is recognized in the Consolidated Statement of Income. A loss is also recognized if the Company intends to sell a bond or it more likely than not will be required to sell a bond before recovery of the amortized cost basis. As of June 30, 2023, based on a review of each of the securities in the available-for-saleits investment securities portfolio the Company concluded that it expected to realize the amortized cost basis of each security. As of June 30, 2023, the Company did not intend to sell nor is it anticipated that it would be required to sell any securities for which fair value was less than the amortized cost basis of the security. The Company intends to continue to closely monitor the performance of its securities because changes in their underlying credit performance or other events could cause the amortized cost basis of those securities to become uncollectable.at March 31, 2024.

~~Accounting guidance requires investment securities held~~Pursuant to ~~maturity to be presented at their net carrying value that is expected to be collected over their contractual term. The Company estimated no material credit losses for its~~

~~- 77 -~~

~~investment securities classified as held-to-maturity at June 30, 2023~~previously approved capital plans and December 31, 2022. The amortized cost basis of obligations of states and political subdivisions in the held-to-maturity portfolio totaled $2.5 billion at June 30, 2023 and $2.6 billion at December 31, 2022. At June 30, 2023 and December 31, 2022, the Company had in its held-to-maturity portfolio privately issued mortgage-backed securities with an amortized cost basis of $47 million and $50 million, respectively, and a fair value of $49 million and $51 million, respectively. At June 30, 2023, 82% of those mortgage-backed securities were in the most senior tranche of the securitization structure. The mortgage-backed securities are generally collateralizedauthorizations approved by residential and small-balance commercial real estate loans originated between 2004 and 2008. After considering the repayment structure and estimated future collateral cash flows of each individual bond, the Company concluded that as of June 30, 2023, it expected to recover the amortized cost basis of those privately issued mortgage-backed securities. Nevertheless, it is possible that adverse changes in the estimated future performance of mortgage loan collateral underlying such securities could impact the Company’s conclusions.

Adjustments to reflect the funded status of defined benefit pension and other postretirement plans, net of applicable tax effect, reduced accumulated other comprehensive income by $205 million or $1.24 per common share at June 30, 2023, $261 million or $1.48 per common share at June 30, 2022 and $202 million or $1.19 per common share at December 31, 2022.

Other adjustments, substantially comprised of net unrealized losses on interest rate swaps designated as cash flow hedges, reduced accumulated other comprehensive income by $332 million or $2.00 per common share at June 30, 2023, $116 million or $.66 per common share at June 30, 2022 and $259 million or $1.53 per common share at December, 31, 2022. Information about net unrealized losses on interest rate swaps designated as cash flow hedges is provided in note 10 of the Notes to Financial Statements.

~~On July 19, 2022,~~ M&T's Board of Directors, ~~authorized a stock purchase program to repurchase up to $3.0 billion of common shares subject to all applicable regulatory reporting limitations.~~ M&T repurchased ~~3,505,946~~3,838,157 shares of its common stock for a total cost of $600 million, ~~under the program in the second quarter of 2022 and 3,838,157 shares for a total cost,~~ including the share repurchase excise tax, ~~of $600 million~~under the program in the first quarter of 2023. ~~No share repurchases occurred~~There were no shares of common stock repurchased in the ~~second~~fourth quarter of 2023. Discretion as to the amount and timing of authorized share repurchases in a given period has been delegated, through the authorization of the Board of Directors, to management and can be influenced by capital and liquidity requirements, including funding of future loan growth and other balance sheet management activities, as well as market and economic conditions.

Cash dividends declared on M&T's common stock totaled $217 million in the recent quarter, compared with $215 million and $219 million in the quarters ended June 30, 2022 and March 31, 2023, respectively. Common stock dividends during the six-month periods ended June 30, 2023 and 2022 were $436 million and $371 million, respectively. Cash dividends declared on preferred stock aggregated $25 million during each of the first two quarters of 2023 and the ~~second~~first quarter of ~~2022. Preferred stock dividends totaled $50 million and $47 million during the first six months of 2023 and 2022, respectively.~~2024.

- 7864 -

M&T and its subsidiary banks are required to comply with applicable ~~capital adequacy standards established by the federal banking agencies.~~Capital Rules. Pursuant to those regulations, the minimum capital ratios are as follows:

•

4.5% ~~Common equity Tier 1 (“CET1”)~~CET1 to ~~risk-weighted assets~~RWA (each as defined in the ~~capital regulations)~~Capital Rules);

•

6.0% Tier 1 capital (that is, CET1 plus additional Tier 1 capital) to ~~risk-weighted assets~~RWA (each as defined in the ~~capital regulations)~~Capital Rules);

•

8.0% Total capital (that is, Tier 1 capital plus Tier 2 capital) to ~~risk-weighted assets~~RWA (each as defined in the ~~capital regulations)~~Capital Rules); and

•

4.0% Tier 1 capital to average consolidated assets as reported on consolidated financial statements (known as the “leverage ratio”), as defined in the ~~capital regulations.~~Capital Rules.

Capital ~~regulations~~Rules require buffers in addition to the minimum risk-based capital ratios noted above. M&T is subject to a ~~stress capital buffer~~SCB requirement that is determined through the Federal Reserve’s supervisory stress tests and M&T’s bank subsidiaries are subject to a 2.5% capital conservation buffer requirement. The buffer requirement must be composed entirely of CET1. ~~M&T's current stress capital buffer is 4.7%. In June 2023,~~Based on the Federal ~~Reserve released the results of its~~Reserve's most recent supervisory stress ~~tests. Based on those results,~~tests M&T's ~~stress capital buffer~~SCB is ~~estimated to be~~ 4.0% ~~effective October 1, 2023.~~.

The regulatory capital ratios of the Company and its bank subsidiaries, M&T Bank and Wilmington Trust, N.A., as of ~~June 30, 2023~~March 31, 2024 are presented in the accompanying table.

REGULATORY CAPITAL RATIOS

~~June 30, 2023~~March 31, 2024


	M&T			M&T			Wilmington			M&T			M&T			Wilmington
	(Consolidated)			Bank			Trust, N.A.

Common equity Tier 1		10.59	%		11.47	%		287.31	%
(Dollars in millions)										(Consolidated)			Bank			Trust, N.A.
CET1											11.08	%		11.66	%		260.57	%
Tier 1 capital		11.91	%		11.47	%		287.31	%		12.38			11.66			260.57
Total capital		13.71	%		13.01	%		287.67	%		14.04			13.11			260.98
Tier 1 leverage		9.25	%		8.89	%		89.22	%		9.47			8.90			86.02
RWA										$	155,338		$	154,730		$	227

Capital Rules generally require the deduction of goodwill and core deposit and other intangible assets, net of applicable deferred taxes, from the calculation of capital in the determination of the minimum capital ratios. As a result of previous business acquisitions, the Company recorded goodwill of $8.5 billion and core deposit and other intangible assets of $132 million at March 31, 2024. Goodwill, as required by GAAP, is not amortized, but rather is tested for impairment at least annually at the business reporting unit level. The Company completed its annual goodwill impairment test in the fourth quarter of 2023 and concluded the amount of goodwill was not impaired at the testing date. The Company has not identified events or circumstances that would more likely than not reduce the fair value of a business reporting unit below its carrying amount at March 31, 2024. Should a business reporting unit with assigned goodwill experience declines in revenue, increased credit losses or expenses, or other adverse developments due to economic, regulatory, competition or other factors, that would be material to that reporting unit, an impairment of goodwill could occur in a future period that could be material to the Company's Consolidated Balance Sheet and its Consolidated Statement of Income. Although a goodwill impairment charge would not have a significant impact on the Company's regulatory tangible capital ratios, it would reduce the capacity of its bank subsidiary, M&T Bank, to dividend earnings to M&T. As described herein under the heading "Liquidity Risk", M&T's parent company liquidity at March 31, 2024 covered projected cash outflows for more than 24 months, including dividends on common and preferred stock, debt service and scheduled debt maturities. Information concerning goodwill and other intangible assets is included in note 8 of Notes to Financial Statements in the 2023 Annual Report.

- 65 -

The Company is subject to the comprehensive regulatory framework applicable to bank and financial holding companies and their subsidiaries, which includes examinations by a number of regulators. Regulation of financial institutions such as M&T and its subsidiaries is intended primarily for the protection of depositors, the DIF of the FDIC and the banking and financial system as a whole, and generally is not intended for the protection of shareholders, investors or creditors other than insureddepositors. Changes in laws, regulations and regulatory policies applicable to the Company’s operations can increase or decrease the cost of doing business, limit or expand permissible activities or affect the competitive environment in which the Company operates, all of which could have a material effect on the business, financial condition or results of operations of the Company and in M&T’s ability to pay dividends. For additional information concerning this comprehensive regulatory framework, refer to Part I, Item 1 of ~~M&T’s Form 10-K for~~ the ~~year ended December 31, 2022.~~2023 Annual Report.

On July 27, 2023, the federal banking agencies issued a notice of proposed rulemaking to modify the regulatory capital requirements applicable to large banking organizations with over $100 billion of total assets and their depository institution subsidiaries. The proposed rule would generally require banking organizations subject to Category III and IV standards, like the Company, to compute their regulatory capital consistent with Category I and II standards. Management is in the process of evaluating the impact of the proposed rule on the regulatory capital requirements of M&T and its subsidiary ~~banks.~~banks and currently estimates the proposed rules would increase the Company's RWA by a percentage in the mid-single digits.

Segment Information

~~The Company's reportable~~Reportable segments have been determined based upon the Company's organizational structure and its internal profitability reporting ~~system, which is organized by strategic business unit.~~system. Financial information about the Company's segments is presented in note 14 of Notes to Financial Statements. The reportable segments are ~~Business Banking,~~ Commercial ~~Banking, Commercial Real Estate, Discretionary Portfolio, Residential Mortgage Banking~~Bank, Retail Bank, and ~~Retail Banking. As described~~Institutional Services and Wealth Management. All other business activities that are not included in the three reportable segment results have been included in the "All Other" category.

NET INCOME (LOSS) BY SEGMENT


	Three Months Ended						Change						Three Months Ended						Change
(Dollars in millions)	March 31, 2024			December 31, 2023			Amount			%			March 31, 2024			March 31, 2023			Amount			%
Net income (loss)
Commercial Bank	$	201		$	220		$	(19	)		-9	%	$	201		$	333		$	(132	)		-40	%
Retail Bank		446			438			8			2			446			452			(6	)		-1
Institutional Services and Wealth Management		128			105			23			21			128			110			18			16
All Other		(244	)		(281	)		37			13			(244	)		(193	)		(51	)		-26
Total net income	$	531		$	482		$	49			10	%	$	531		$	702		$	(171	)		-24	%

Commercial Bank

The Commercial Bank segment provides a wide range of credit products and banking services to middle-market and large commercial customers, mainly within the markets served by the Company. Services provided by this segment include commercial lending and leasing, credit facilities which are secured by various types of commercial real estate, letters of credit, deposit products and cash management services. Commercial real estate loans may be secured by multifamily residential buildings, hotels, office, retail and industrial space or other types of collateral. Activities of this segment include the origination, sales and servicing of commercial real estate loans through the Fannie Mae DUS program and other programs. Commercial real estate loans held for sale are included in this segment.

- 7966 -

~~Company’s Form 10-K for~~COMMERCIAL BANK SEGMENT FINANCIAL SUMMARY


	Three Months Ended				Change						Three Months Ended				Change
(Dollars in millions)	March 31, 2024		December 31, 2023		Amount			%			March 31, 2024		March 31, 2023		Amount			%
Income Statement
Net interest income	$	548	$	583	$	(35	)		-6	%	$	548	$	649	$	(101	)		-16	%
Noninterest income		151		176		(25	)		-14			151		162		(11	)		-7
Total revenue		699		759		(60	)		-8			699		811		(112	)		-14
Provision for credit losses		77		113		(36	)		-31			77		34		43			129
Noninterest expense		345		344		1			—			345		322		23			7
Income before taxes		277		302		(25	)		-9			277		455		(178	)		-39
Income taxes		76		82		(6	)		-8			76		122		(46	)		-38
Net income	$	201	$	220	$	(19	)		-9	%	$	201	$	333	$	(132	)		-40	%
Average Balance Sheet
Loans and leases:
Commercial and industrial	$	49,048	$	47,717	$	1,331			3	%	$	49,048	$	44,655	$	4,393			10	%
Commercial real estate		30,747		31,489		(742	)		-2			30,747		33,280		(2,533	)		-8
Residential real estate		447		444		3			1			447		329		118			36
Consumer		25		21		4			14			25		25		—			-3
Total loans and leases, net	$	80,267	$	79,671	$	596			1	%	$	80,267	$	78,289	$	1,978			3	%
Deposits:
Noninterest-bearing		13,459		14,527		(1,068	)		-7			13,459		20,206		(6,747	)		-33
Interest-bearing		30,074		29,127		947			3			30,074		22,593		7,481			33
Total deposits	$	43,533	$	43,654	$	(121	)		—	%	$	43,533	$	42,799	$	734			2	%

The Commercial Bank segment’s net income was $201 million in the year ended December 31, 2022, certain lending relationships within the hospitality sector were realigned from the Commercial Banking segment to the Commercial Real Estate segment and certain expenses were reallocated from the All Other segment to various reportable segmentsfirst quarter of 2024, compared with $220 million in the fourth quarter of ~~2022. During 2022,~~2023.

•

Net interest income declined $35 million reflecting a narrowing of the ~~Company also realigned certain acquired operations~~net interest margin on loans and deposits by 13 basis points and 4 basis points, respectively.

•

Noninterest income decreased $25 million reflecting lower commercial mortgage banking revenues and a decrease in credit-related fees (predominantly loan syndication fees).

•

The provision for credit losses decreased $36 million reflecting lower net charge-offs on loans secured by commercial real estate, partially offset by higher net charge-offs on commercial and industrial loans.

•

Average loans and leases increased $596 million reflecting $1.3 billion of growth in average commercial and industrial loans that spanned most industry types, partially offset by a reduction in average commercial real estate loans.

•

Average deposits in the recent quarter as compared with the final quarter of 2023 reflect a shift from noninterest-bearing accounts to interest-bearing products amidst an elevated interest rate environment.

Net income for the Commercial Bank segment declined $132 million in the first quarter of 2024 from $333 million in the year-earlier quarter.

•

Net interest income declined $101 million reflecting a narrowing of the net interest margin on loans and deposits of 37 basis points and 43 basis points, respectively, partially offset by a rise in average outstanding loan balances of $2.0 billion.

•

Noninterest income decreased $11 million due to lower gains on sales of leased equipment and lower gains on commercial mortgage loans originated for sale, partially offset by higher service charges on commercial deposit accounts.

•

The provision for credit losses increased $43 million reflecting higher net charge-offs on commercial and industrial loans, partially offset by lower net charge-offs on loans secured by commercial real estate.

•

Noninterest expense increased $23 million reflecting a rise in centrally-allocated costs associated with ~~People's United primarily consisting of reclassifications of certain revenues~~data processing, risk management and ~~expenses~~other support services provided to the Commercial ~~Banking~~Bank segment of $21 million.

- 67 -

•

The increase in average loans from ~~other reportable segments. The results~~the first quarter of 2023 reflects higher average balances of commercial and ~~analysis provided herein are reflective of those changes.~~industrial loans including growth in loans to financial and insurance industry customers and to motor-vehicle and recreational finance dealers, partially offset by a reduction in average permanent commercial real estate and average construction loans.

•

Average deposits grew $734 million from the year-earlier first quarter and reflected a shift in customer funds from noninterest-bearing accounts to interest-bearing products amidst an elevated interest rate environment.

Retail Bank

The ~~Business Banking~~Retail Bank segment ~~recorded~~provides a wide range of services to consumers and small businesses through the Company’s branch network and several other delivery channels such as telephone banking, internet banking and automated teller machines. The Company has branch offices in New York State, Maryland, New Jersey, Pennsylvania, Delaware, Connecticut, Massachusetts, Maine, Vermont, New Hampshire, Virginia, West Virginia and the District of Columbia. The segment offers to its customers deposit products, including demand, savings and time accounts, and other services. Credit services offered by this segment include automobile and recreational finance loans (originated both directly and indirectly through dealers), home equity loans and lines of credit, credit cards and other loan products. This segment also originates and services residential mortgage loans and either sells those loans in the secondary market to investors or retains them for investment purposes. Residential mortgage loans are also originated and serviced on behalf of the Institutional Services and Wealth Management segment. The Company periodically purchases the rights to service residential real estate loans that have been originated by other entities and also sub-services residential real estate loans for others. Residential real estate loans held for sale are included in this segment. This segment also provides various business loans, including loans guaranteed by the SBA, business credit cards, deposit products and services such as cash management, payroll and direct deposit, merchant credit card and letters of credits to small businesses and professionals through the Company's branch network and other delivery channels.

RETAIL BANK SEGMENT FINANCIAL SUMMARY


	Three Months Ended				Change						Three Months Ended				Change
(Dollars in millions)	March 31, 2024		December 31, 2023		Amount			%			March 31, 2024		March 31, 2023		Amount			%
Income Statement
Net interest income	$	1,071	$	1,083	$	(12	)		-1	%	$	1,071	$	1,064	$	7			1	%
Noninterest income		197		194		3			2			197		170		27			16
Total revenue		1,268		1,277		(9	)		-1			1,268		1,234		34			3
Provision for credit losses		68		56		12			22			68		43		25			61
Noninterest expense		599		629		(30	)		-5			599		580		19			3
Income before taxes		601		592		9			1			601		611		(10	)		-1
Income taxes		155		154		1			—			155		159		(4	)		-3
Net income	$	446	$	438	$	8			2	%	$	446	$	452	$	(6	)		-1	%
Average Balance Sheet
Loans and leases:
Commercial and industrial	$	6,874	$	6,766	$	108			2	%	$	6,874	$	6,819	$	55			1	%
Commercial real estate		1,904		1,908		(4	)		—			1,904		1,909		(5	)		—
Residential real estate		20,843		21,057		(214	)		-1			20,843		21,721		(878	)		-4
Consumer		20,387		19,762		625			3			20,387		19,645		742			4
Total loans and leases, net	$	50,008	$	49,493	$	515			1	%	$	50,008	$	50,094	$	(86	)		—	%
Deposits:
Noninterest-bearing		25,380		26,474		(1,094	)		-4			25,380		30,552		(5,172	)		-17
Interest-bearing		66,269		65,448		821			1			66,269		61,317		4,952			8
Total deposits	$	91,649	$	91,922	$	(273	)		—	%	$	91,649	$	91,869	$	(220	)		—	%

- 68 -

The Retail Bank segment’s net income ~~of $116~~increased $8 million to $446 million in the ~~second~~first quarter of 2024 from $438 million in the final quarter of 2023.

•

Net interest income declined $12 million.

•

Noninterest income increased $3 million.

•

The provision for credit losses increased $12 million reflecting higher net charge-offs of recreational finance loans, indirect auto loans and business banking loans.

•

Noninterest expenses declined $30 million due to declines in equipment and net occupancy costs of $10 million, centrally-allocated costs associated with data processing, risk management, and other support services provided to the Retail Bank segment of $8 million and advertising and marketing expenses of $7 million.

•

Average loans increased $515 million reflecting growth in the segment's portfolio of recreational finance loans and automobile loans.

•

Average deposits in the recent quarter as compared with the final quarter of 2023 ~~compared with $68~~reflect a shift from noninterest-bearing accounts to interest-bearing products amidst an elevated interest rate environment.

Net income for the Retail Bank segment decreased $6 million ~~and $113 million, respectively,~~ in the ~~periods ended June 30, 2022~~recent quarter from $452 million in the first quarter of 2023.

•

Net interest income rose $7 million.

•

Noninterest income increased $27 million primarily due to higher residential mortgage banking revenues reflecting a rise in servicing income from the bulk purchase of residential mortgage loan servicing rights at the end of the first quarter of 2023 and ~~March 31, 2023. As compared with the year-earlier quarter, the~~an increase ~~was~~in service charges on deposit accounts.

•

The provision for credit losses increased $25 million reflecting higher net charge-offs of consumer loans.

•

Noninterest expense rose $19 million predominantly due to higher ~~net interest income~~centrally-allocated costs associated with data processing, risk management, and other support services provided to the Retail Bank segment of ~~$73~~$22 million, partially offset by a decrease in personnel-related costs reflecting ~~a comparatively higher interest rate environment~~lower staffing levels.

•

Average loans in the recent quarter declined slightly from the first quarter of 2023, reflecting lower balances of residential real estate loans, partially offset by higher average consumer loans resulting from growth of recreational finance loan balances. In the first quarter of 2023, the Company returned to originating for sale the majority of its newly originated residential mortgage loans.

•

Average deposits in the recent quarter as compared with the first quarter of 2023 reflect a shift from noninterest-bearing accounts to interest-bearing products amidst an elevated interest rate environment.

- 69 -

Institutional Services & Wealth Management

The Institutional Services and Wealth Management segment provides a variety of trustee, agency, investment management and administrative services for corporations and institutions, investment bankers, corporate tax, finance and legal executives, and other institutional clients, as well as personal trust, planning, fiduciary, asset management, family office and other services designed to help high net worth individuals and families grow, preserve and transfer wealth. This segment also provides investment products, including mutual funds and annuities and other services to customers.

INSTITUTIONAL SERVICES & WEALTH MANAGEMENT SEGMENT FINANCIAL SUMMARY


	Three Months Ended				Change						Three Months Ended				Change
(Dollars in millions)	March 31, 2024		December 31, 2023		Amount			%			March 31, 2024		March 31, 2023		Amount			%
Income Statement
Net interest income	$	186	$	176	$	10			6	%	$	186	$	170	$	16			9	%
Noninterest income		191		186		5			3			191		220		(29	)		-13
Total revenue		377		362		15			4			377		390		(13	)		-4
Provision for credit losses		—		—		—			—			—		—		—			—
Noninterest expense		205		219		(14	)		-6			205		241		(36	)		-15
Income before taxes		172		143		29			21			172		149		23			15
Income taxes		44		38		6			19			44		39		5			14
Net income	$	128	$	105	$	23			21	%	$	128	$	110	$	18			16	%
Average Balance Sheet
Loans and leases:
Commercial and industrial	$	783	$	761	$	22			3	%	$	783	$	787	$	(4	)		-1	%
Commercial real estate		48		56		(8	)		-13			48		53		(5	)		-9
Residential real estate		1,846		1,838		8			—			1,846		1,720		126			7
Consumer		722		766		(44	)		-6			722		812		(90	)		-11
Total loans and leases, net	$	3,399	$	3,421	$	(22	)		-1	%	$	3,399	$	3,372	$	27			1	%
Deposits:
Noninterest-bearing		9,081		8,477		604			7			9,081		10,363		(1,282	)		-12
Interest-bearing		7,168		6,759		409			6			7,168		7,970		(802	)		-10
Total deposits	$	16,249	$	15,236	$	1,013			7	%	$	16,249	$	18,333	$	(2,084	)		-11	%

The Institutional Services and Wealth Management segment’s net income increased $23 million to $128 million in the first quarter of 2024 from $105 million in the last quarter of 2023.

•

Net interest income increased $10 million reflecting a widening of the net interest margin on deposits of 3 basis points and a $1.0 billion increase in average outstanding deposit balances.

•

Noninterest income increased $5 million reflecting higher brokerage fee and trust income.

•

Noninterest expenses decreased $14 million reflecting a decline in personnel-related costs and professional and other services.

Net income for the Institutional Services and Wealth Management segment increased $18 million in the recent quarter from $110 million in the year-earlier first quarter.

•

Net interest income increased $16 million reflecting a widening of the net interest margin on deposits of 80 basis points, partially offset by a $7$2.1 billion decline in average outstanding deposit balances.

•

Noninterest income decreased $29 million predominantly due to lower trust income of $34 million reflecting lower revenues associated with the CIT business of approximately $45 million following its sale in April 2023, partially offset by higher revenues from the segment’s global capital markets business. An increase in brokerage services income reflecting sales of annuity products partially offset the trust income decline.

•

Noninterest expenses decreased $36 million reflecting a $39 million decline in professional and other services due, in part, to lower sub-advisory fees as a result of the sale of the CIT business, partially offset by an increase in centrally-allocated costs associated with data processing, risk management and other support services provided to the ~~Business Banking~~Institutional Services and Wealth Management segment. The higher net interest income reflected a 224 basis point widening of the net interest margin on deposits, partially offset by a 106 basis point narrowing of the net interest margin on loans and a decline in average outstanding deposit balances of $5.0 billion. As compared with the first quarter of 2023, the modest increase in net income in the recent quarter was attributable to a $4 million decrease in the provision for credit losses. Net income recorded by the Business Banking segment was $229 million in the first six months of 2023, compared with $107 million in the year-earlier period. Reflecting the impact of one additional quarter of People’s United-related operations, that 114% improvement resulted from a $199 million rise in net interest income, partially offset by a $23 million increase in centrally-allocated costs associated with data processing, risk management and other support services and higher personnel-related costs of $10 million. The increase in net interest income reflected a widening of the net interest margin on deposits of 232 basis points, partially offset by a narrowing of the net interest margin on loans of 116 basis points.

Net income earned by the Commercial Banking segment totaled $166 million during the quarter ended June 30, 2023, $162 million in the year-earlier quarter and $220 million in the first quarter of 2023. The increase in net income as compared with the second quarter of 2022 reflected higher credit-related and other fees of $12 million and a lower provision for credit losses of $7 million, largely offset by a $19 million increase in centrally-allocated costs associated with data processing, risk management and other support services provided to the Commercial Banking segment. The recent quarter’s 25% decline in net income as compared with the initial 2023 quarter was largely due to lower net interest income of $47 million, a $15 million increase in the provision for credit losses and a $10 million rise in centrally-allocated costs associated with data processing, risk management and other support services. The recent quarter’s decline in net interest income as compared with the first quarter of 2023 reflected a narrowing of the interest margin on loans and deposits of 31 and 14 basis points, respectively, and a decrease in average outstanding deposit balances of $2.5 billion, partially offset by higher average outstanding loan balances of $2.0 billion. The Commercial Banking segment contributed $386 million of net income in the first half of 2023, up from $290 million earned in the similar 2022 period. Contributing to that rise was a $179 million increase in net interest income and higher credit-related fees of $34 million, partially offset by higher centrally-allocated costs associated with data processing, risk management and other support services of $59 million and increases in personnel-related costs of $37 million, all reflecting one additional quarter of People’s United-related activity. The higher net interest income in the first half of 2023 was driven by a widening of the net interest margin on deposits of 157 basis points and higher average outstanding loan balances of $13.2 billion, partially offset by a 43 basis point narrowing of the net interest margin on loans and lower average outstanding deposit balances of $5.0 billion.

The Commercial Real Estate segment contributed net income of $39 million in the recent quarter, compared with $118 million in the second quarter of 2022 and $81 million in the initial 2023 quarter. The decline as compared with the second quarter of 2022 reflects a rise in the provision for credit losses of $68 million, a $25 million decrease in net interest income and higher centrally-allocated costs associated with data processing, risk management and other support services provided to the Commercial Real Estate segment of $11 million. The lower net interest income was driven by a 38 basis point narrowing of the net interest margin on loans and decreases in average outstanding balances of deposits and loans of $2.5 billion and $1.8 billion, respectively, partially offset by a widening of the net interest margin on deposits of 142 basis points. The decline in the recent quarter’s net income as compared with the first quarter of 2023 was driven by a $43 million increase in the provision for credit losses and lower net interest income of $8

- 8070 -

million. The increase in the provision for credit losses in the recent quarter as compared with the year-earlier quarter and 2023’s first quarter reflects higher net charge-offs. Net income earned by the Commercial Real Estate segment totaled $120 million during the six-month period ended June 30, 2023, compared with $229 million in the corresponding 2022 period. The factors contributing to that decline included: a $106 million increase in the provision for credit losses, reflecting higher net charge-offs; a $30 million rise in centrally-allocated costs associated with data processing, risk management and other support services; and a $14 million decline in net interest income reflecting the narrowing of the net interest margin on loans of 52 basis points. Those unfavorable factors were partially offset by a widening of the net interest margin on deposits of 165 basis points and higher average outstanding balances of loans of $2.4 billion.

The Discretionary Portfolio segment recorded net losses of $32 million in the recent quarter and $40 million in the initial 2023 quarter, compared with net income of $44 million in the second quarter of 2022. As compared with 2022’s second quarter, the recent quarter’s results reflected a decline in net interest income of $117 million, driven by increased interest expense from interest rate swap agreements utilized as part of the Company’s management of interest rate risk, partially offset by a $19 million decrease in intersegment fees paid to the Residential Mortgage Banking segment reflecting the Company’s return in the first quarter of 2023 to originating for sale the majority of its newly originated residential mortgage loans, and favorable trading and non-hedging derivative gains of $6 million. The reduction in net loss in the recent quarter as compared with the immediately preceding quarter was attributable to a $5 million increase in net interest income. In the first six months of 2023, the Discretionary segment recorded a net loss of $72 million, compared with net income of $79 million in the comparable 2022 period. The year-over-year decline was predominantly the result of a $226 million decrease in net interest income reflecting the Company’s management of interest rate risk through interest rate swap agreements, offset, in part, by lower intersegment fees paid to the Residential Mortgage Banking segment of $28 million and favorable trading and non-hedging derivative gains of $7 million.

The Residential Mortgage Banking segment recorded net losses of $15 million and $12 million, respectively, during the quarters ended June 30, 2023 and March 31, 2023, compared with net income of $8 million in the quarter ended June 30, 2022. As compared with the year-earlier period, the net loss in the recent quarter reflects lower net interest income of $11 million. The modest increase in net loss from the first quarter of 2023 was driven by higher personnel-related costs (including severance and overtime salary expenses) of $6 million. The Residential Mortgage Banking segment recorded a net loss of $27 million in the first six months of 2023, compared with net income of $35 million in the corresponding 2022 period. Factors attributable to the net loss included a decline in net interest income of $30 million and lower revenues associated with mortgage origination and sales activities (including intersegment revenues) of $27 million, partially offset by a $7 million decline in centrally-allocated costs associated with data processing, risk management and other support services provided to the Residential Mortgage Banking segment and $5 million of lower personnel-related costs.

Net income earned by the Retail Banking segment totaled $336 million in the second quarter of 2023, compared with $105 million in the year-earlier quarter and $317 million in the first quarter of 2023. The improvement in the recent quarter as compared with the second quarter of 2022 included higher net interest income of $351 million reflecting a 226 basis point widening of the net interest margin on deposits, partially offset by a $5.6 billion decline in average outstanding balances in deposits. Those beneficial results were partially offset by higher personnel-related costs and a rise in the provision for credit losses of $14 million each, and a $6 million decline in service charges on deposit accounts. As compared with the immediately preceding quarter, the $20 million increase in net income was driven by higher net interest income of $29 million, declines of $5 million each in the provision for credit losses and check fraud and other losses. Those favorable factors were partially offset by a $20 million increase in centrally-allocated costs associated with data processing, risk management and other support services provided to the Retail Banking segment. The rise in net interest income was predominantly due to a 21 basis point widening in the net interest margin on deposits, partially offset by a 9 basis point narrowing of the net interest margin on loans. Net income recorded by the Retail Banking segment totaled $653 million in the first half of 2023 and $184 million in 2022. The most significant factor contributing to that 255% increase in net income was an $822 million increase in net interest income, reflecting a widening of the net interest margin on deposits of 229 basis points and higher average outstanding balances of deposits of $7.2 billion due, in part, to deposits assumed on April 1, 2022 in the People’s United transaction.

~~- 81 -~~

Partially offsetting that favorable factor was an increase in personnel-related costs of $77 million, a higher provision for credit losses of $33 million due to higher net charge-offs, a $29 million rise in equipment and occupancy costs, an increase in check fraud and other losses of $23 million and higher centrally-allocated costs associated with data processing, risk management and other support services of $9 million. Higher levels of expenses in the first half of 2023 reflect an additional three months of operations related to People’s United as compared with the year-earlier period.All Other

The “All Other” category reflects other activities of the Company that are not directly attributable to the reported segments. Reflected in this category are the ~~amortization of~~difference between the provision for credit losses and the calculated provision allocated to the reportable segments; goodwill and core deposit and other intangible assets resulting from the acquisitions of financial ~~institutions, distributions from BLG,~~institutions; merger-related gains and expenses ~~resulting from acquisitions, and~~related to acquisitions; the net impact of the Company’s ~~allocation methodologies for~~ internal ~~transfers for funding charges~~funds transfer pricing methodology; eliminations of transactions between reportable segments; certain non-recurring transactions; and ~~credits associated with~~ the residual effects of unallocated support systems and general and administrative expenses. The Company’s investment securities portfolio, brokered deposits and short-term and long-term borrowings are generally included in the “All Other” category. In its management of interest rate risk, the Company utilizes interest rate swap agreements to modify the repricing characteristics of certain portfolios of earning assets and interest-bearing ~~liabilities~~liabilities. The results of such activities are captured in the ~~Company’s reportable segments and the provision for credit losses.~~ "All Other" category.

ALL OTHER CATEGORY FINANCIAL SUMMARY


	Three Months Ended						Change						Three Months Ended						Change
(Dollars in millions)	March 31, 2024			December 31, 2023			Amount			%			March 31, 2024			March 31, 2023			Amount			%
Income Statement
Net interest income (expense)	$	(125	)	$	(120	)	$	(5	)		4	%	$	(125	)	$	(65	)	$	(60	)		91	%
Noninterest income		41			22			19			76			41			35			6			16
Total revenue (expense)		(84	)		(98	)		14			-13			(84	)		(30	)		(54	)		179
Provision for credit losses		55			56			(1	)		—			55			43			12			25
Noninterest expense		247			258			(11	)		-5			247			216			31			15
Income before taxes		(386	)		(412	)		26			-6			(386	)		(289	)		(97	)		34
Income taxes		(142	)		(131	)		(11	)		9			(142	)		(96	)		(46	)		49
Net income	$	(244	)	$	(281	)	$	37			-13	%	$	(244	)	$	(193	)	$	(51	)		26	%

The “All Other” category ~~also includes income from~~recorded a net loss in the ~~Company's ICS and WAS business activities. The various components~~first quarter of ~~the “All Other” category resulted in net income~~2024 of ~~$256~~$244 million, ~~for the quarter ended June 30, 2023,~~ compared with a net loss of ~~$287~~$281 million in the ~~second~~fourth quarter of ~~2022 and net~~2023.

•

Net interest income decreased $5 million.

•

Noninterest income increased $19 million primarily reflecting BLG distributions of ~~$24~~$25 million, ~~and~~partially offset by a decline in tax-exempt income earned from bank owned life insurance revenue.

•

Noninterest expense decreased $11 million reflecting a decline in FDIC assessment expense of $169 million due to the $197 million special assessment expense recorded in the fourth quarter of 2023, partially offset by the incremental special assessment expense of $29 million recorded in the first quarter of ~~2023.~~2024. The ~~$543 million favorable change from the year-earlier quarter reflected the $225 million gain on sale~~decrease was partially offset by a rise in personnel-related costs of ~~the CIT business in April 2023, a decrease to the provision for credit losses of $223~~$109 million reflecting ~~a $242~~merit increases and seasonally higher stock-based compensation and employee benefits expenses; an increase in other costs of operations of $27 million ~~provision~~reflecting higher costs associated with the Company's supplemental executive retirement savings plan, losses on lease terminations related to certain vacated properties and incremental charitable contributions as compared with the fourth quarter of 2023; and increased outside data processing and software expense of $8 million.

The net loss recorded for ~~credit losses~~the “All Other” category was $193 million in the ~~second~~first quarter ~~of 2023 on loans acquired from People’s United not deemed to be PCD, a $116~~2023.

•

Net interest income decreased $60 million ~~increase in~~reflecting higher net interest ~~income attributable to an increased net~~expense from interest ~~margin of 222 basis points on deposits related to~~rate swap agreements entered into for interest rate risk management purposes, as well as the ~~ICS and WAS businesses, a favorable~~unfavorable impact from the Company’s allocation methodologies for internal transfers ~~for~~related to funding charges and credits associated with earning assets and interest-bearing liabilities of the Company’s reportable ~~segments, and merger-related expenses associated with acquisition~~segments.

•

Noninterest income increased $6 million reflecting an increase in BLG distributions of ~~People’s United that were incurred~~$5 million.

•

The $12 million increase in the ~~second quarter of 2022. No merger-related expenses were incurred in~~provision for credit losses reflects the ~~recent quarter. The increase in~~ net ~~income in the second quarter of 2023 as compared with the immediately preceding quarter reflected the gain on sale~~impact of the ~~CIT business, a decrease in personnel-related expenses~~allocation of ~~$74~~provision to reportable segments.

•

Noninterest expense increased $31 million ~~predominantly due to seasonal stock compensation and employee benefits expenses~~reflecting estimated incremental special FDIC assessment expense of $29 million recorded in the first quarter of 2023 and a decline in the provision for credit losses of $17 million, partially offset by income received from BLG of $20 million in the first quarter of 2023. The “All Other” category had a net gain of $280 million for the six months ended June 30, 2023, compared with a net loss of $345 million recorded in the corresponding prior year period. The improved performance in 2023 was attributable to the following factors: a $373 million increase in net interest income attributable to a 234 basis point widening in net interest margin on deposits, the $225 million gain on the sale of the CIT business; a decrease in the provision for credit losses of $184 million reflecting a $242 million provision for credit losses in the second quarter of 2023 on loans acquired from People’s United not deemed to be PCD; lower merger-related costs associated with People’s United; and the favorable impact from the Company's allocation methodologies for internal transfers for funding charges and credits associated with earnings assets and interest-bearing liabilities of the Company's reportable segments. Increased expenses generally resulting from one additional quarter of operations from People’s United partially offset those favorable factors.2024.

- 71 -

Other Matters

~~As widely reported~~On March 6, 2024, the SEC adopted a ~~global cybersecurity incident involving MOVEit, a file transfer software owned~~final rule to enhance and standardize climate-related disclosures by ~~Progress Software Corporation, occurred in May 2023.~~public companies. The ~~software is used by thousands~~final rule requires registrants, including the Company, to disclose their risk management processes for material climate-related risks, governance and oversight of ~~public~~material climate-risks and ~~private sector entities around the world. This incident resulted in the potential exposure of customer information for~~ any ~~organization using MOVEit. It was determined~~risks that no information was obtained from the Company’s internal systems and these systems were not at risk from the MOVEit incident, however, certain customer information available at some of the Company's external service providers was compromised. The Company has begun notifying its affected customers of this incident. The Company does not believe this incident willhave materially impacted, or are reasonably likely to have a material impact on, its business strategy, results of operations or ~~consolidated~~ financial ~~statements.~~condition. Additionally, the final rule requires disclosure of material Scope 1 and Scope 2 greenhouse gas emissions, material climate targets and goals and certain disclosures related to severe weather events and other natural conditions. Such disclosures will be required in a registrant’s annual reporting under a phased-in approach beginning with annual reports for the year ending December 31, 2025 for calendar-year-end large accelerated filers, such as M&T. On April 4, 2024, the SEC issued an order to stay the final rule pending the completion of judicial review by the United States Court of Appeals for the Eighth Circuit.

~~- 82 -~~

Recent Accounting Developments

A discussion of the Company's significant accounting policies and critical accounting estimates can be found in the 2023 Annual Report. A summary of recent accounting developments is included in note 161 of Notes to Financial Statements.

Forward-Looking Statements

Management’s Discussion and Analysis of Financial Condition and Results of Operations and other sections of this quarterly report contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of ~~1995 and the rules and regulations of the SEC.~~1995. Any statement that does not describe historical or current facts is a forward-looking statement, including statements based on current expectations, estimates and projections about the Company’s business, and management's beliefs and ~~assumptions made by management.~~assumptions.

Statements regarding the potential effects of events or factors specific to the Company and/or the financial industry as a whole, as well as national and global events generally, ~~including economic conditions,~~ on the Company's business, financial condition, liquidity and results of operations may constitute forward-looking statements. Such statements are subject to the risk that the actual effects may differ, possibly materially, from what is reflected in those forward-looking statements due to factors and future developments that are uncertain, unpredictable and in many cases beyond the Company's control.

Forward-looking statements are typically identified by words such as "believe," "expect," "anticipate," "intend," "target," "estimate," "continue," or "potential," by future conditional verbs such as "will," "would," "should," "could," or "may," or by variations of such words or by similar expressions. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions ~~("Future Factors")~~ which are difficult to ~~predict. Therefore,~~predict and may cause actual outcomes ~~and results may~~to differ materially from what is expressed or ~~forecasted in such forward-looking statements.~~forecasted.

~~Examples~~While there can be no assurance that any list of ~~Future Factors include:~~risks and uncertainties is complete, important factors that could cause actual outcomes and results to differ materially from those contemplated by forward-looking statements include the ~~impact of the Company's acquisition of People's United (as described in the next paragraph);~~following, without limitation: economic conditions and growth rates, including inflation and market volatility; events and developments in the financial services industry, including ~~legislation, regulations and other governmental actions as well as business conditions affecting the~~ industry ~~and/or M&T and its subsidiaries, individually or collectively; economic conditions, including inflation and market volatility;~~conditions; changes in interest rates, spreads on earning assets and interest-bearing liabilities, and interest rate sensitivity; prepayment speeds, loan originations, loan concentrations by type and industry, credit losses and market values on loans, collateral securing loans, and other assets; sources of liquidity; levels of client deposits; ability to contain costs and expenses; changes in the Company's credit ratings; the impact of the People's United acquisition; domestic or international political developments and other geopolitical events, including international conflicts and hostilities; changes and trends in the securities markets; common shares ~~outstanding;~~outstanding, common stock price volatility; fair value of and number of stock-based compensation awards to be issued in future periods; the impact of changes in market values on trust-related revenues; federal, state or local legislation and/or regulations affecting the financial services industry, or M&T and its subsidiaries individually or collectively, including tax policy; regulatory supervision and oversight, including monetary policy and capital requirements; ~~domestic or international political developments and other geopolitical events, including international conflicts;~~ governmental and public policy ~~changes, including tax policy;~~changes; political conditions, either nationally or in the states in which M&T and its subsidiaries do business; the outcome of pending and future litigation and governmental proceedings, including tax-related examinations and other matters; changes in accounting policies or procedures as may be required

- 72 -

by the Financial Accounting Standards Board, regulatory agencies or legislation; increasing price, product and service competition by competitors, including new entrants; ~~rapid~~ technological developments and changes; the ability to continue to introduce competitive new products and services on a timely, cost-effective basis; the mix of products and services; ~~containing costs and expenses;~~ protection and validity of intellectual property rights; reliance on large customers; technological, implementation and cost/financial risks in large, multi-year contracts; continued availability of financing; financial resources in the amounts, at the times and on the terms required to support M&T and its subsidiaries' future businesses; and material differences in the actual financial results of merger, acquisition, divestment and investment activities compared with M&T's initial expectations, including the full realization of anticipated cost savings and revenue enhancements.

In addition, Future Factors related to the acquisition of People's United include, among others: the possibility that the anticipated benefits of the transaction will not be realized when expected or at all; potential adverse reactions or changes to business, customer or employee relationships; the Company's success in executing its business plans and strategies and managing the risks involved in the foregoing; the results and costs of integration efforts; the business, economic and political conditions in the markets in which M&T and its subsidiaries operate; the outcome of any legal proceedings that may be instituted against M&T or its subsidiaries; and other factors related to the acquisition that may affect future results of the Company.

~~- 83 -~~

These are representative of the ~~Future Factors~~factors that could affect the outcome of the forward-looking statements. In addition, as noted, such statements could be affected by general industry and market conditions and growth rates, general economic and political conditions, either nationally or in the states in which ~~M&T and its subsidiaries do~~the Company does business, ~~including interest rate and currency exchange rate fluctuations, changes and trends in the securities markets,~~ and other ~~Future Factors.~~factors.

~~M&T~~The Company provides further detail regarding these risks and uncertainties in ~~its Form 10-K for~~ the ~~year ended December 31, 2022,~~2023 Annual Report, including in the Risk Factors section of such report, as well as in other SEC filings. Forward-looking statements speak only as of the date they are made, and ~~M&T does not assume any~~the Company assumes no duty and does not undertake to update forward-looking statements.

- 8473 -

M&T BANK CORPORATION AND SUBSIDIARIES

Table 1

QUARTERLY TRENDS


	2023 Quarters						2022 Quarters												2024			2023 Quarters
	Second			First			Fourth			Third			Second			First
(Dollars in millions, except per share, shares in thousands)																			First Quarter			Fourth			Third			Second			First
Earnings and dividends
Amounts in thousands, except per share
Interest income (taxable-equivalent basis)	$	2,529,511			2,340,447			2,085,594			1,793,340			1,475,868			931,490		$	2,757		$	2,753		$	2,656		$	2,530		$	2,341
Interest expense		716,496			508,721			244,835			102,822			53,425			24,082			1,065			1,018			866			717			509
Net interest income		1,813,015			1,831,726			1,840,759			1,690,518			1,422,443			907,408			1,692			1,735			1,790			1,813			1,832
Less: provision for credit losses		150,000			120,000			90,000			115,000			302,000			10,000			200			225			150			150			120
Other income		803,171			587,133			681,537			563,079			571,100			540,887			580			578			560			803			587
Less: other expense		1,292,559			1,359,230			1,408,288			1,279,253			1,403,154			959,741			1,396			1,450			1,278			1,293			1,359
Income before income taxes		1,173,627			939,629			1,024,008			859,344			288,389			478,554			676			638			922			1,173			940
Applicable income taxes		292,707			224,543			245,252			200,921			60,141			113,146			133			143			217			292			224
Taxable-equivalent adjustment		13,886			13,462			13,385			11,827			10,726			3,234			12			13			15			14			14
Net income	$	867,034			701,624			765,371			646,596			217,522			362,174		$	531		$	482		$	690		$	867		$	702
Net income available to common shareholders-diluted	$	840,524			675,511			739,126			620,554			192,236			339,590		$	505		$	457		$	664		$	841		$	676
Per common share data
Per common share data:
Basic earnings	$	5.07			4.03			4.32			3.55			1.08			2.63			3.04			2.75			4.00			5.07			4.03
Diluted earnings		5.05			4.01			4.29			3.53			1.08			2.62			3.02			2.74			3.98			5.05			4.01
Cash dividends	$	1.30			1.30			1.20			1.20			1.20			1.20			1.30			1.30			1.30			1.30			1.30
Average common shares outstanding
Average common shares outstanding:
Basic		165,842			167,732			171,187			174,609			177,367			128,945			166,460			165,985			165,909			165,842			167,732
Diluted		166,320			168,410			172,149			175,682			178,277			129,416			167,084			166,731			166,570			166,320			168,410
Performance ratios, annualized
Return on
Return on:
Average assets		1.70	%		1.40	%		1.53	%		1.28	%		.42	%		.97	%		1.01	%		.92	%		1.33	%		1.70	%		1.40	%
Average common shareholders’ equity		14.27	%		11.74	%		12.59	%		10.43	%		3.21	%		8.55	%		8.14			7.41			10.99			14.27			11.74
Net interest margin on average earning assets (taxable-equivalent basis)		3.91	%		4.04	%		4.06	%		3.68	%		3.01	%		2.65	%		3.52			3.61			3.79			3.91			4.04
Nonaccrual loans to total loans and leases, net of unearned discount		1.83	%		1.92	%		1.85	%		1.89	%		2.05	%		2.32	%		1.71			1.62			1.77			1.83			1.92
Net operating (tangible) results (a)
Net operating income (in thousands)	$	878,661			714,935			812,359			700,030			577,622			375,999
Net operating income																			$	543		$	494		$	702		$	879		$	715
Diluted net operating income per common share	$	5.12			4.09			4.57			3.83			3.10			2.73		3.09				2.81			4.05			5.12			4.09
Annualized return on
Annualized return on:
Average tangible assets		1.80	%		1.49	%		1.70	%		1.44	%		1.16	%		1.04	%		1.08	%		.98	%		1.41	%		1.80	%		1.49	%
Average tangible common shareholders’ equity		22.73	%		19.00	%		21.29	%		17.89	%		14.41	%		12.44	%		12.67			11.70		17.41			22.73				19.00
Efficiency ratio (b)		48.9	%		55.5	%		53.3	%		53.6	%		58.3	%		64.9	%		60.8			62.1			53.7			48.9			55.5
Balance sheet data
In millions, except per share
Average balances
Average balances:
Total assets (c)	$	204,376			202,599			198,592			201,131			208,865			151,648		$	211,478		$	208,752		$	205,791		$	204,376		$	202,599
Total tangible assets (c)		195,764			193,957			189,934			192,450			200,170			147,053			202,906			200,172			197,199			195,764			193,957
Earning assets		185,936			184,069			179,914			182,382			189,755			138,624			193,135			190,536			187,403			185,936			184,069
Investment securities		28,623			27,622			25,297			23,945			22,384			7,724			28,587			27,490			27,993			28,623			27,622
Loans and leases, net of unearned discount		133,545			132,012			129,406			127,525			127,599			92,159			133,796			132,770			132,617			133,545			132,012
Deposits		159,399			161,537			163,468			167,271			174,683			128,055			164,065			164,713			162,688			159,399			161,537
Borrowings																				16,001			13,057			12,585			15,055			11,505
Common shareholders’ equity (c)		23,674			23,366			23,335			23,654			24,079			16,144			25,008			24,489			24,009			23,674			23,366
Tangible common shareholders’ equity (c)		15,062			14,724			14,677			14,973			15,384			11,549			16,436			15,909			15,417			15,062			14,724
At end of quarter
At end of quarter:
Total assets (c)	$	207,672			202,956			200,730			197,955			204,033			149,864			215,137			208,264			209,124			207,672			202,956
Total tangible assets (c)		199,074			194,321			192,082			189,281			195,344			145,269			206,574			199,689			200,538			199,074			194,321
Earning assets		188,504			183,853			181,855			178,351			185,109			137,237			195,712			189,140			189,942			188,504			183,853
Investment securities		27,916			28,443			25,211			24,604			22,802			9,357			28,496			26,897			27,336			27,916			28,443
Loans and leases, net of unearned discount		133,344			132,938			131,564			128,226			128,486			91,808			134,973			134,068			132,355			133,344			132,938
Deposits		162,058			159,075			163,515			163,845			170,358			126,319			167,196			163,274			164,128			162,058			159,075
Borrowings																				16,245			13,517			13,854			15,325			14,458
Common shareholders’ equity (c)		23,790			23,366			23,307			23,245			23,784			16,126			25,158			24,946			24,186			23,790			23,366
Tangible common shareholders’ equity (c)		15,192			14,731			14,659			14,571			15,095			11,531			16,595			16,371			15,600			15,192			14,731
Equity per common share		143.41			140.88			137.68			134.45			135.16			124.93			150.90			150.15			145.72			143.41			140.88
Tangible equity per common share		91.58			88.81			86.59			84.28			85.78			89.33			99.54			98.54			93.99			91.58			88.81

(a)

Excludes amortization and balances related to goodwill and core deposit and other intangible assets and merger-related expenses which, except in the calculation of the efficiency ratio, are net of applicable income tax effects. A reconciliation of net income and net operating income appears in Table 2.

(b)

Excludes impact of merger-related expenses and net securities transactions.

(c)

The difference between total assets and total tangible assets, and common shareholders’ equity and tangible common shareholders’ equity, represents goodwill, core deposit and other intangible assets, net of applicable deferred tax balances. A reconciliation of such balances appears in Table 2.

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M&T BANK CORPORATION AND SUBSIDIARIES

Table 2

RECONCILIATION OF QUARTERLY GAAP TO NON-GAAP MEASURES


	2023 Quarters						2022 Quarters													2024			2023 Quarters
	Second			First			Fourth			Third			Second			First
Income statement data (in thousands, except per share)
(Dollars in millions, except per share)																				First Quarter			Fourth			Third			Second			First
Income statement data																			Income statement data
Net income
Net income	$	867,034			701,624			765,371			646,596			217,522			362,174			$	531		$	482		$	690		$	867		$	702
Amortization of core deposit and other intangible assets (a)		11,627			13,311			13,559			14,141			14,138			933				12			12			12			12			13
Merger-related expenses (a)		—			—			33,429			39,293			345,962			12,892
Net operating income	$	878,661			714,935			812,359			700,030			577,622			375,999			$	543		$	494		$	702		$	879		$	715
Earnings per common share
Diluted earnings per common share	$	5.05			4.01			4.29			3.53			1.08			2.62			$	3.02		$	2.74		$	3.98		$	5.05		$	4.01
Amortization of core deposit and other intangible assets (a)		0.07			.08			.08			.08			.08			.01				.07			.07			.07			.07			.08
Merger-related expenses (a)		—			—			.20			.22			1.94			.10
Diluted net operating earnings per common share	$	5.12			4.09			4.57			3.83			3.10			2.73			$	3.09		$	2.81		$	4.05		$	5.12		$	4.09
Other expense
Other expense	$	1,292,559			1,359,230			1,408,288			1,279,253			1,403,154			959,741			$	1,396		$	1,450		$	1,278		$	1,293		$	1,359
Amortization of core deposit and other intangible assets		(14,945	)		(17,208	)		(17,600	)		(18,384	)		(18,384	)		(1,256	)			(15	)		(15	)		(15	)		(15	)		(17	)
Merger-related expenses		—			—			(45,113	)		(53,027	)		(222,809	)		(17,372	)
Noninterest operating expense	$	1,277,614			1,342,022			1,345,575			1,207,842			1,161,961			941,113			$	1,381		$	1,435		$	1,263		$	1,278		$	1,342
Merger-related expenses
Salaries and employee benefits	$	—			—			3,670			13,094			85,299			87
Equipment and net occupancy		—			—			2,294			2,106			502			1,807
Outside data processing and software		—			—			2,193			2,277			716			252
Advertising and marketing		—			—			5,258			2,177			1,199			628
Printing, postage and supplies		—			—			2,953			651			2,460			722
Other costs of operations		—			—			28,745			32,722			132,633			13,876
Other expense		—			—			45,113			53,027			222,809			17,372
Provision for credit losses		—			—			—			—			242,000			—
Total	$	—		$	—			45,113			53,027			464,809			17,372
Efficiency ratio
Noninterest operating expense (numerator)	$	1,277,614			1,342,022			1,345,575			1,207,842			1,161,961			941,113			$	1,381		$	1,435		$	1,263		$	1,278		$	1,342
Taxable-equivalent net interest income	$	1,813,015			1,831,726			1,840,759			1,690,518			1,422,443			907,408			$	1,692		$	1,735		$	1,790		$	1,813		$	1,832
Other income		803,171			587,133			681,537			563,079			571,100			540,887				580			578			560			803			587
Less: Gain (loss) on bank investment securities		1,004			(416	)		(3,773	)		(1,108	)		(62	)		(743	)			2			4			—			1			—
Denominator	$	2,615,182			2,419,275			2,526,069			2,254,705			1,993,605			1,449,038			$	2,270		$	2,309		$	2,350		$	2,615		$	2,419
Efficiency ratio		48.9	%		55.5	%		53.3	%		53.6	%		58.3	%		64.9	%			60.8	%		62.1	%		53.7	%		48.9	%		55.5	%
Balance sheet data (in millions)
Balance sheet data
Average assets
Average assets	$	204,376			202,599			198,592			201,131			208,865			151,648			$	211,478		$	208,752		$	205,791		$	204,376		$	202,599
Goodwill		(8,473	)		(8,490	)		(8,494	)		(8,501	)		(8,501	)		(4,593	)			(8,465	)		(8,465	)		(8,465	)		(8,473	)		(8,490	)
Core deposit and other intangible assets		(185	)		(201	)		(218	)		(236	)		(254	)		(3	)			(140	)		(154	)		(170	)		(185	)		(201	)
Deferred taxes		46			49			54			56			60			1				33			39			43			46			49
Average tangible assets	$	195,764			193,957			189,934			192,450			200,170			147,053			$	202,906		$	200,172		$	197,199		$	195,764		$	193,957
Average common equity
Average total equity	$	25,685			25,377			25,346			25,665			26,090			17,894			$	27,019		$	26,500		$	26,020		$	25,685		$	25,377
Preferred stock		(2,011	)		(2,011	)		(2,011	)		(2,011	)		(2,011	)		(1,750	)			(2,011	)		(2,011	)		(2,011	)		(2,011	)		(2,011	)
Average common equity		23,674			23,366			23,335			23,654			24,079			16,144				25,008			24,489			24,009			23,674			23,366
Goodwill		(8,473	)		(8,490	)		(8,494	)		(8,501	)		(8,501	)		(4,593	)			(8,465	)		(8,465	)		(8,465	)		(8,473	)		(8,490	)
Core deposit and other intangible assets		(185	)		(201	)		(218	)		(236	)		(254	)		(3	)			(140	)		(154	)		(170	)		(185	)		(201	)
Deferred taxes		46			49			54			56			60			1				33			39			43			46			49
Average tangible common equity	$	15,062			14,724			14,677			14,973			15,384			11,549			$	16,436		$	15,909		$	15,417		$	15,062		$	14,724
At end of quarter
Total assets
Total assets	$	207,672			202,956			200,730			197,955			204,033			149,864			$	215,137		$	208,264		$	209,124		$	207,672		$	202,956
Goodwill		(8,465	)		(8,490	)		(8,490	)		(8,501	)		(8,501	)		(4,593	)			(8,465	)		(8,465	)		(8,465	)		(8,465	)		(8,490	)
Core deposit and other intangible assets		(177	)		(192	)		(209	)		(227	)		(245	)		(3	)			(132	)		(147	)		(162	)		(177	)		(192	)
Deferred taxes		44			47			51			54			57			1				34			37			41			44			47
Total tangible assets	$	199,074			194,321			192,082			189,281			195,344			145,269			$	206,574		$	199,689		$	200,538		$	199,074		$	194,321
Total common equity
Total equity	$	25,801			25,377			25,318			25,256			25,795			17,876			$	27,169		$	26,957		$	26,197		$	25,801		$	25,377
Preferred stock		(2,011	)		(2,011	)		(2,011	)		(2,011	)		(2,011	)		(1,750	)			(2,011	)		(2,011	)		(2,011	)		(2,011	)		(2,011	)
Common equity		23,790			23,366			23,307			23,245			23,784			16,126				25,158			24,946			24,186			23,790			23,366
Goodwill		(8,465	)		(8,490	)		(8,490	)		(8,501	)		(8,501	)		(4,593	)			(8,465	)		(8,465	)		(8,465	)		(8,465	)		(8,490	)
Core deposit and other intangible assets		(177	)		(192	)		(209	)		(227	)		(245	)		(3	)			(132	)		(147	)		(162	)		(177	)		(192	)
Deferred taxes		44			47			51			54			57			1				34			37			41			44			47
Total tangible common equity	$	15,192			14,731			14,659			14,571			15,095			11,531			$	16,595		$	16,371		$	15,600		$	15,192		$	14,731

(a)

After any related tax effect.

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~~M&T BANK CORPORATION AND SUBSIDIARIES~~

~~Table 3~~

~~AVERAGE BALANCE SHEETS AND ANNUALIZED TAXABLE-EQUIVALENT RATES~~

2023 Second Quarter

2023 First Quarter

2022 Fourth Quarter

Average
Balance

Interest

Average
Rate

Average
Balance

Interest

Average
Rate

Average
Balance

Interest

Average
Rate

Average balance in millions; interest in thousands

Assets

Earning assets

Loans and leases, net of unearned
discount (a)

Commercial, financial, etc.

$
44,531

$
754,312

6.79
%

$
42,428

$
676,194

6.46
%

$
40,038

$
581,161

5.76
%

Real estate – commercial

44,944

710,284

6.25

45,327

659,099

5.82

45,690

591,290

5.06

Real estate – consumer

23,781

243,896

4.10

23,770

235,141

3.96

23,334

228,391

3.92

Consumer

20,289

297,217

5.88

20,487

286,596

5.67

20,344

270,590

5.28

Total loans and leases, net

133,545

2,005,709

6.02

132,012

1,857,030

5.70

129,406

1,671,432

5.12

Interest-bearing deposits at banks

23,617

302,429

5.14

24,312

278,417

4.64

25,089

237,021

3.75

Federal funds sold and agreements
to resell securities

—

6

5.53

—

2

4.89

—

4

4.32

Trading account

151

994

2.66

123

712

2.32

122

652

2.13

Investment securities (b)

U.S. Treasury and federal agencies

24,630

179,452

2.92

23,795

166,978

2.85

21,590

140,315

2.58

Obligations of states and political subdivisions

2,555

23,600

3.71

2,570

23,751

3.75

2,607

24,228

3.67

Other

1,438

17,321

4.83

1,257

13,557

4.38

1,100

11,942

4.31

Total investment securities

28,623

220,373

3.09

27,622

204,286

3.00

25,297

176,485

2.77

Total earning assets

185,936

2,529,511

5.46

184,069

2,340,447

5.16

179,914

2,085,594

4.60

Allowance for credit losses

(1,985
)

(1,938
)

(1,888
)

Cash and due from banks

1,747

1,952

1,989

Other assets

18,678

18,516

18,577

Total assets

$
204,376

$
202,599

��

$
198,592

Liabilities and shareholders’ equity

Interest-bearing liabilities

Interest-bearing deposits

Savings and interest-checking deposits

$
87,210

$
368,362

1.69

$
88,053

$
277,068

1.28

$
87,068

$
167,421

.76

Time deposits

16,009

150,337

3.77

11,630

89,197

3.11

6,182

20,119

1.29

Total interest-bearing deposits

103,219

518,699

2.02

99,683

366,265

1.49

93,250

187,540

.80

Short-term borrowings

7,539

95,996

5.11

4,994

57,776

4.69

1,632

13,336

3.24

Long-term borrowings

7,516

101,801

5.43

6,511

84,680

5.27

3,753

43,959

4.65

Total interest-bearing liabilities

118,274

716,496

2.43

111,188

508,721

1.86

98,635

244,835

.98

Noninterest-bearing deposits

56,180

61,854

70,218

Other liabilities

4,237

4,180

4,393

Total liabilities

178,691

177,222

173,246

Shareholders’ equity

25,685

25,377

25,346

Total liabilities and shareholders’ equity

$
204,376

$
202,599

$
198,592

Net interest spread

3.03

3.30

3.62

Contribution of interest-free funds

.88

.74

.44

Net interest income/margin on earning assets

$
1,813,015

3.91
%

$
1,831,726

4.04
%

$
1,840,759

4.06
%

~~(a)~~

~~Includes nonaccrual loans.~~

~~(b)~~

~~Includes available-for-sale securities at amortized cost.~~

~~(continued)~~

~~- 87 -~~

~~M&T BANK CORPORATION AND SUBSIDIARIES~~

~~Table 3 (continued)~~

~~AVERAGE BALANCE SHEETS AND ANNUALIZED TAXABLE-EQUIVALENT RATES (continued)~~

2022 Third Quarter

2022 Second Quarter

Average
Balance

Interest

Average
Rate

Average
Balance

Interest

Average
Rate

Average balance in millions; interest in thousands

Assets

Earning assets

Loans and leases, net of unearned
    discount (a)

Commercial, financial, etc.

$
38,321

$
470,738

4.87
%

$
37,818

$
373,543

3.96
%

Real estate – commercial

46,282

531,225

4.49

47,227

461,594

3.87

Real estate – consumer

22,962

220,464

3.84

22,761

207,080

3.64

Consumer

19,960

239,471

4.76

19,793

210,290

4.26

Total loans and leases, net

127,525

1,461,898

4.55

127,599

1,252,507

3.94

Interest-bearing deposits at banks

30,752

172,956

2.23

39,386

80,773

.82

Federal funds sold and agreements
   to resell securities

29

41

.55

250

253

.41

Trading account

131

583

1.78

136

199

.59

Investment securities (b)

U.S. Treasury and federal agencies

20,227

124,084

2.43

18,644

109,755

2.36

Obligations of states and political
  subdivisions

2,688

23,626

3.49

2,768

23,344

3.38

Other

1,030

10,152

3.91

972

9,037

3.73

Total investment securities

23,945

157,862

2.62

22,384

142,136

2.55

Total earning assets

182,382

1,793,340

3.90

189,755

1,475,868

3.12

Allowance for credit losses

(1,822
)

(1,814
)

Cash and due from banks

1,962

1,690

Other assets

18,609

19,234

Total assets

$
201,131

$
208,865

Liabilities and shareholders’ equity

Interest-bearing liabilities

Interest-bearing deposits

Savings and interest-checking deposits

$
89,360

$
68,690

.31

$
95,149

$
27,907

.12

Time deposits

5,050

1,124

.09

5,480

1,227

.09

Total interest-bearing deposits

94,410

69,814

.29

100,629

29,134

.12

Short-term borrowings

913

2,670

1.16

1,126

3,419

1.22

Long-term borrowings

3,281

30,338

3.67

3,282

20,872

2.55

Total interest-bearing liabilities

98,604

102,822

.41

105,037

53,425

.20

Noninterest-bearing deposits

72,861

74,054

Other liabilities

4,001

3,684

Total liabilities

175,466

182,775

Shareholders’ equity

25,665

26,090

Total liabilities and shareholders’ equity

$
201,131

$
208,865

Net interest spread

3.49

2.92

Contribution of interest-free funds

.19

.09

Net interest income/margin on earning assets

$
1,690,518

3.68
%

$
1,422,443

3.01
%

~~(a)~~

~~Includes nonaccrual loans.~~

~~(b)~~

~~Includes available-for-sale securities at amortized cost.~~

~~- 88 -~~

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

Incorporated by reference to the discussion contained ~~under the caption “Taxable-equivalent Net Interest Income”~~ in Part I, Item 2, ~~“Management’s~~"Management's Discussion and Analysis of Financial Condition and Results of ~~Operations.”~~Operations," under the captions "Liquidity Risk," "Market Risk and Interest Rate Sensitivity" and "Capital."

Item 4. Controls and Procedures.

(a) Evaluation of disclosure controls and procedures. Based upon their evaluation of the effectiveness of M&T’s disclosure controls and procedures (as defined in Exchange Act rules 13a-15(e) and 15d-15(e)), René F. Jones, Chairman of the Board and Chief Executive Officer, and Daryl N. Bible, Senior Executive Vice President and Chief Financial Officer, concluded that M&T’s disclosure controls and procedures were effective as of ~~June 30, 2023.~~March 31, 2024.

(b) Changes in internal control over financial reporting. M&T regularly assesses the adequacy of its internal control over financial reporting and enhances its controls in response to internal control assessments and internal and external audit and regulatory recommendations. No changes in internal control over financial reporting have been identified in connection with the evaluation of disclosure controls and procedures during the quarter ended ~~June 30, 2023~~March 31, 2024 that have materially affected, or are reasonably likely to materially affect, M&T’s internal control over financial reporting.

- 8976 -

PART II. OTHER INFORMATION

Item 1. Legal Proceedings.

M&T and its subsidiaries are subject in the normal course of business to various pending and threatened legal proceedings and other matters in which claims for monetary damages are asserted. On an on-going basis management, after consultation with legal counsel, assesses the Company’s liabilities and contingencies in connection with such proceedings. For those matters where it is probable that the Company will incur losses and the amounts of the losses can be reasonably estimated, the Company records an expense and corresponding liability in its consolidated financial statements. To the extent the pending or threatened litigation could result in exposure in excess of that liability, the amount of such excess is not currently estimable. Although not considered probable, the range of reasonably possible losses for such matters in the aggregate, beyond the existing recorded liability, was between $0 and $25 millionas of ~~June 30, 2023.~~March 31, 2024. Although the Company does not believe that the outcome of pending legal matters will be material to the Company’s consolidated financial position, it cannot rule out the possibility that such outcomes will be material to the consolidated results of operations for a particular reporting period in the future.

Item 1A. Risk Factors.

There have been no material changes in risk factors relating to M&T to those disclosed in response to ~~Item 1A. to~~ Part I, Item 1A of ~~Form 10-K for~~ the ~~year ended December 31, 2022.~~2023 Annual Report.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

(a) – (b) Not applicable.

(c)

Issuer Purchases of Equity Securities

Period

(a) Total
Number
of Shares
(or Units)
Purchased (1)

(b) Average
Price Paid
per Share
(or Unit)

(c) Total
Number of
Shares
(or Units)
Purchased
as Part of
Publicly
Announced
Plans or
Programs

(d) Maximum
Number (or
Approximate
Dollar Value)
of Shares
(or Units)
that may yet
be Purchased
Under the
Plans or
Programs (2)

April 1 - April 30, 2023

466

$
118.50

—

$
1,200,060,000

May 1 - May 31, 2023

131

119.20

—

1,200,060,000

June 1 - June 30, 2023

659

120.08

—

1,200,060,000

Total

1,256

$
119.40

—


	Issuer Purchases of Equity Securities
Period	Total Number of Shares (or Units) Purchased (1)		Average Price Paid per Share (or Unit)		Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs		Maximum Number (or Approximate Dollar Value) of Shares (or Units) that may yet be Purchased Under the Plans or Programs (2)
January 1 - January 31, 2024		210	$	136.94		—	$	1,200,060,000
February 1 - February 29, 2024		—		—		—		1,200,060,000
March 1 - March 31, 2024		18,205		140.05		—		1,200,060,000
Total		18,415	$	140.01		—

(1)

The total number of shares purchased during the periods indicated includes shares purchased as part of publicly announced programs and/or shares deemed to have been received from employees who exercised stock options by attesting to previously acquired common shares in satisfaction of the exercise price or shares received from employees upon the vesting of restricted stock awards in satisfaction of applicable tax withholding obligations, as is permitted under M&T’s stock-based compensation plans.

(2)

In July 2022, M&T's Board of Directors authorized a program under which $3.0 billion of common shares may be repurchased with the exact number, timing, price and terms of such repurchases to be determined at the discretion of management and subject to all regulatory limitations.

Item 3. Defaults Upon Senior Securities.

(None.)

Item 4. Mine Safety Disclosures.

(Not applicable.)

- 77 -

Item 5. Other Information.

(a) – (b) Not applicable.

(c) Certain of our officers or directors have made elections to participate in, and are participating in, our tax-qualified 401(k) plan and nonqualified deferred compensation plans, or have made, and may from time to time make,

~~- 90 -~~

elections to reinvest dividends in M&T Bank Corporation common stock, or have shares withheld to cover withholding taxes upon the vesting of equity awards or to pay the exercise price of options, each of which may be designed to satisfy the affirmative defense conditions of Rule 10b5-1 under the Exchange Act or may constitute non-Rule 10b5-1 trading arrangements (as defined in Item 408(c) of Regulation S-K).

Item 6. Exhibits.

The following exhibits are filed as a part of this report.


Exhibit No.

10.1		Retirement and Consulting Agreement, dated as of February 8, 2024, by and between Doris Meister and M&T Bank. Filed herewith.*

31.1		Certification of Chief Executive Officer under Section 302 of the Sarbanes-Oxley Act of 2002. Filed herewith.

31.2		Certification of Chief Financial Officer under Section 302 of the Sarbanes-Oxley Act of 2002. Filed herewith.

32.1		Certification of Chief Executive Officer under 18 U.S.C. §1350 pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. Filed herewith.

32.2		Certification of Chief Financial Officer under 18 U.S.C. §1350 pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. Filed herewith.

101.INS		Inline XBRL Instance Document. Filed herewith.

101.SCH		Inline XBRL Taxonomy Extension ~~Schema. Filed herewith.~~

~~101.CAL~~		~~Inline XBRL Taxonomy Extension Calculation Linkbase. Filed herewith.~~

~~101.DEF~~		~~Inline XBRL Taxonomy Extension Definition Linkbase. Filed herewith.~~

~~101.LAB~~		~~Inline XBRL Taxonomy Extension Label Linkbase. Filed herewith.~~

~~101.PRE~~		~~Inline XBRL Taxonomy Extension Presentation Linkbase.~~Schema With Embedded Linkbase Documents. Filed herewith.

104		The cover page from M&T Bank Corporation’s Quarterly Report on Form 10-Q for the quarter ended ~~June 30, 2023~~March 31, 2024 has been formatted in Inline XBRL.

* Management contract or compensatory plan or arrangement.

- 9178 -

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


	M&T BANK CORPORATION

Date: ~~August 8, 2023~~May 3, 2024	By:	/s/ Daryl N. Bible
		Daryl N. Bible
		Senior Executive Vice President and Chief Financial Officer

- 9279 -


New York		16-0968385
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

One M ~~& T~~&T Plaza Buffalo, New York		14203
(Address of principal executive offices)		(Zip Code)


Title of Each Class	Trading Symbols	Name of Each Exchange on Which Registered
Common Stock, ~~$.50~~$0.50 par value	MTB	New York Stock Exchange
Perpetual Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series H	MTBPrH	New York Stock Exchange


	June 30,			December 31,			March 31,			December 31,
(Dollars in thousands, except per share)	2023			2022
(Dollars in millions, except per share)							2024			2023
Assets
Cash and due from banks	$	1,848,386		$	1,517,244		$	1,695		$	1,731
Interest-bearing deposits at banks		27,106,899			24,958,719			32,144			28,069
Federal funds sold		—			3,000
Trading account		137,240			117,847			99			106
Investment securities
Available for sale (cost: $11,248,458 at June 30, 2023; $11,193,152 at December 31, 2022)		10,807,659			10,748,961
Held to maturity (fair value: $14,713,496 at June 30, 2023; $12,375,420 at December 31, 2022)		15,918,106			13,529,969
Equity and other securities (cost: $1,191,927 at June 30, 2023; $933,766 at December 31, 2022)		1,190,690			931,941
Available for sale (cost: $12,397 at March 31, 2024; $10,691 at December 31, 2023)								12,134			10,440
Held to maturity (fair value: $13,865 at March 31, 2024; $14,308 at December 31, 2023)								15,078			15,330
Equity and other securities (cost: $1,279 at March 31, 2024; $1,125 at December 31, 2023)								1,284			1,127
Total investment securities		27,916,455			25,210,871			28,496			26,897
Loans and leases		134,061,568			132,074,156
Unearned discount		(717,839	)		(509,993	)
Loans and leases, net of unearned discount		133,343,729			131,564,163
Loans and leases, net of unearned discount of $928 at March 31, 2024 and $868 at December 31, 2023								134,973			134,068
Allowance for credit losses		(1,998,366	)		(1,925,331	)		(2,191	)		(2,129	)
Loans and leases, net		131,345,363			129,638,832			132,782			131,939
Premises and equipment		1,672,998			1,653,628			1,707			1,739
Goodwill		8,465,089			8,490,089			8,465			8,465
Core deposit and other intangible assets		177,221			209,374			132			147
Accrued interest and other assets		9,002,078			8,930,237			9,617			9,171
Total assets	$	207,671,729		$	200,729,841		$	215,137		$	208,264
Liabilities
Noninterest-bearing deposits	$	54,937,913		$	65,501,860		$	50,578		$	49,294
Savings and interest-checking deposits		88,046,247			87,911,463			96,339			93,221
Time deposits		19,074,220			10,101,545			20,279			20,759
Total deposits		162,058,380			163,514,868			167,196			163,274
Short-term borrowings		7,907,884			3,554,951			4,795			5,316
Accrued interest and other liabilities		4,487,894			4,377,495			4,527			4,516
Long-term borrowings		7,416,638			3,964,537			11,450			8,201
Total liabilities		181,870,796			175,411,851			187,968			181,307
Shareholders' equity
Preferred stock, $1.00 par, 20,000,000 shares authorized; Issued and outstanding: Liquidation preference of $1,000 per share: 350,000 shares at June 30, 2023 and December 31, 2022; Liquidation preference of $10,000 per share: 140,000 shares at June 30, 2023 and December 31, 2022; Liquidation preference of $25 per share: 10,000,000 shares at June 30, 2023 and December 31, 2022		2,010,600			2,010,600
Common stock, $.50 par, 250,000,000 shares authorized, 179,436,779 shares issued at June 30, 2023 and December 31, 2022		89,718			89,718
Common stock issuable, 12,124 shares at June 30, 2023; 14,031 shares at December 31, 2022		972			1,112
Preferred stock, $1.00 par, 20,000,000 shares authorized; Issued and outstanding: Liquidation preference of $1,000 per share: 350,000 shares at March 31, 2024 and December 31, 2023; Liquidation preference of $10,000 per share: 140,000 shares at March 31, 2024 and December 31, 2023; Liquidation preference of $25 per share: 10,000,000 shares at March 31, 2024 and December 31, 2023								2,011			2,011
Common stock, $0.50 par, 250,000,000 shares authorized, 179,436,779 shares issued at March 31, 2024 and December 31, 2023								90			90
Common stock issuable, 11,458 shares at March 31, 2024; 12,217 shares at December 31, 2023								1			1
Additional paid-in capital		10,000,335			10,002,891			9,976			10,020
Retained earnings		16,836,810			15,753,978			17,812			17,524
Accumulated other comprehensive income (loss), net		(864,800	)		(790,030	)		(589	)		(459	)
Treasury stock — common, at cost — 13,555,383 shares at June 30, 2023; 10,165,419 shares at December 31, 2022		(2,272,702	)		(1,750,279	)
Treasury stock — common, at cost — 12,724,121 shares at March 31, 2024; 13,300,298 shares at December 31, 2023								(2,132	)		(2,230	)
Total shareholders’ equity		25,800,933			25,317,990			27,169			26,957
Total liabilities and shareholders’ equity	$	207,671,729		$	200,729,841		$	215,137		$	208,264


	Three Months Ended June 30						Six Months Ended June 30						Three Months Ended March 31,
(In thousands)	2023			2022			2023			2022

(Dollars in millions)													2024			2023
Net income	$	867,034		$	217,522		$	1,568,658		$	579,696		$	531		$	702
Other comprehensive income (loss), net of tax and reclassification adjustments:
Net unrealized gains (losses) on investment securities		(63,810	)		(70,551	)		1,330			(206,918	)		(10	)		65
Cash flow hedges adjustments		(156,290	)		(58,188	)		(75,357	)		(172,249	)		(117	)		81
Defined benefit plans liability adjustments														(1	)		(2	)
Foreign currency translation adjustments		1,316			(4,264	)		2,510			(5,912	)		(2	)		1
Defined benefit plans liability adjustments		(1,011	)		3,898			(3,253	)		6,167
Total other comprehensive income (loss)		(219,795	)		(129,105	)		(74,770	)		(378,912	)		(130	)		145
Total comprehensive income	$	647,239		$	88,417		$	1,493,888		$	200,784		$	401		$	847


	Six Months Ended June 30
(In thousands)	2023			2022
							Three Months Ended March 31,
(Dollars in millions)							2024			2023
Cash flows from operating activities
Net income	$	1,568,658		$	579,696		$	531		$	702
Adjustments to reconcile net income to net cash provided by operating activities
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for credit losses		270,000			312,000			200			120
Depreciation and amortization of premises and equipment		148,806			134,949			80			76
Amortization of capitalized servicing rights		57,442			50,998			35			20
Amortization of core deposit and other intangible assets		32,153			19,640			15			17
Provision for deferred income taxes		(6,687	)		(77,346	)		2			11
Asset write-downs		1,337			3,469			6			1
Net gain on sales of assets		(234,388	)		(10,856	)		(1	)		(12	)
Net change in accrued interest receivable, payable		259,115			10,834			27			55
Net change in other accrued income and expense		(72,168	)		(32,412	)		(74	)		(43	)
Net change in loans originated for sale		(339,702	)		571,879			(352	)		(274	)
Net change in trading account and other non-hedging derivative assets and liabilities		521			920,288			139			(245	)
Net cash provided by operating activities		1,685,087			2,483,139			608			428
Cash flows from investing activities
Proceeds from sales of investment securities
Proceeds from sales of investment securities:
Available for sale								4			—
Equity and other securities		614,355			26,286			110			521
Proceeds from maturities of investment securities
Proceeds from maturities of investment securities:
Available for sale		298,136			467,788			1,989			141
Held to maturity		570,742			572,192			257			281
Purchases of investment securities
Purchases of investment securities:
Available for sale		(343,946	)		(4,588,013	)		(4,145	)		(337	)
Held to maturity		(2,947,627	)		(796,312	)		—			(2,948	)
Equity and other securities		(872,516	)		(26,505	)		(264	)		(792	)
Net increase in loans and leases		(1,645,467	)		(265,684	)		(724	)		(1,166	)
Net (increase) decrease in interest-bearing deposits at banks		(2,148,180	)		17,628,196			(4,075	)		2,652
Capital expenditures, net		(101,379	)		(87,742	)		(35	)		(55	)
Net decrease in loan servicing advances		285,706			1,039,029			81			207
Acquisition, net of cash consideration
Bank and bank holding company		—			393,923
Other, net		(359,299	)		(324,594	)		(280	)		(251	)
Net cash provided (used) by investing activities		(6,649,475	)		14,038,564
Net cash used by investing activities								(7,082	)		(1,747	)
Cash flows from financing activities
Net decrease in deposits		(1,454,879	)		(14,151,849	)
Net increase (decrease) in deposits								3,921			(4,441	)
Net increase (decrease) in short-term borrowings		4,352,933			(72,595	)		(521	)		3,440
Proceeds from long-term borrowings		3,485,675			—			3,357			3,486
Payments on long-term borrowings		(194	)		(900,096	)		(49	)		—
Purchases of treasury stock		(594,000	)		(600,000	)		—			(594	)
Dividends paid — common		(436,369	)		(369,822	)		(221	)		(221	)
Dividends paid — preferred		(49,881	)		(47,046	)		(34	)		(34	)
Other, net		(10,755	)		(29,598	)		(15	)		(19	)
Net cash provided (used) by financing activities		5,292,530			(16,171,006	)
Net increase in cash, cash equivalents and restricted cash		328,142			350,697
Net cash provided by financing activities								6,438			1,617
Net increase (decrease) in cash, cash equivalents and restricted cash								(36	)		298
Cash, cash equivalents and restricted cash at beginning of period		1,520,244			1,337,577			1,731			1,520
Cash, cash equivalents and restricted cash at end of period	$	1,848,386		$	1,688,274		$	1,695		$	1,818
Supplemental disclosure of cash flow information
Interest received during the period	$	4,813,949		$	2,416,362		$	2,716		$	2,289
Interest paid during the period		922,988			86,713			999			410
Income taxes paid during the period		329,200			231,687			41			22
Supplemental schedule of noncash investing and financing activities
Real estate acquired in settlement of loans	$	11,612		$	8,800			19			7
Additions to right-of-use assets under operating leases		68,672			31,013			19			31
Acquisition of bank and bank holding company
Common stock issued		—			8,286,515
Common stock awards converted		—			104,810
Fair value of
Assets acquired (noncash)		—			63,757,316
Liabilities assumed		—			55,499,314
Preferred stock converted		—			260,600


Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
Emerging growth company	☐


Table of Contents of Information Required in Report			Page
	Glossary of Terms		3
Part I. FINANCIAL INFORMATION

Item 1.	Financial Statements

	CONSOLIDATED BALANCE SHEET – ~~June 30, 2023~~March 31, 2024 and December 31, ~~2022~~		3

	~~CONSOLIDATED STATEMENT OF INCOME – Three and six months ended June 30,~~ 2023 ~~and 2022~~		4

	CONSOLIDATED STATEMENT OF ~~COMPREHENSIVE~~ INCOME – Three ~~and six~~ months ended ~~June 30,~~March 31, 2024 and 2023 ~~and 2022~~		5

	CONSOLIDATED STATEMENT OF ~~CASH FLOWS~~COMPREHENSIVE INCOME – ~~Six~~Three months ended ~~June 30,~~March 31, 2024 and 2023 ~~and 2022~~		6

	CONSOLIDATED STATEMENT OF ~~CHANGES IN SHAREHOLDERS' EQUITY~~CASH FLOWS – Three ~~and six~~ months ended ~~June 30,~~March 31, 2024 and 2023 ~~and 202~~	2	7
	7
	CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY – Three months ended March 31, 2024 and 2023		8

	NOTES TO FINANCIAL STATEMENTS		89

Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations		5039

Item 3.	Quantitative and Qualitative Disclosures About Market Risk		8976

Item 4.	Controls and Procedures		8976

Part II. OTHER INFORMATION

Item 1.	Legal Proceedings		9077

Item 1A.	Risk Factors		9077

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		9077

Item 3.	Defaults Upon Senior Securities		9077

Item 4.	Mine Safety Disclosures		9077

Item 5.	Other Information		9078

Item 6.	Exhibits		9178

SIGNATURES			9279


Term	Definition
2023 Annual Report	Form 10-K for the year ended December 31, 2023
Bayview Financial	Bayview Financial Holdings, L.P. together with its affiliates
BLG	Bayview Lending Group, LLC
Capital Rules	Capital adequacy standards established by the federal banking agencies
CET1	Common Equity Tier 1
CIT	Collective Investment Trust
Company	M&T Bank Corporation and its consolidated subsidiaries
DIF	Deposit Insurance Fund
DUS	Delegated Underwriting and Servicing
Executive ALCO Committee	Executive Asset-Liability Liquidity Capital Committee of M&T
FDIC	Federal Deposit Insurance Corporation
FHLB	Federal Home Loan Bank
FOMC	Federal Open Market Committee
FRB	Federal Reserve Bank
GAAP	Accounting principles generally accepted in the U.S.
GDP	Gross Domestic Product
Junior subordinated debentures	Fixed and variable rate junior subordinated deferrable interest debentures
LTV	Loan-to-value
M&T	M&T Bank Corporation
M&T Bank	Manufacturers and Traders Trust Company
People’s United	People’s United Financial, Inc.
RWA	Risk-weighted assets
SCB	Stress capital buffer
SOFR	Secured Overnight Financing Rate
U.S.	United States of America


														Accumulated
														Other
					Common			Additional						Comprehensive
	Preferred		Common		Stock			Paid-in			Retained			Income			Treasury
Dollars in thousands, except per share	Stock		Stock		Issuable			Capital			Earnings			(Loss), Net			Stock			Total
Three Months Ended June 30, 2023
Balance — April 1, 2023	$	2,010,600	$	89,718	$	957		$	9,986,325		$	16,212,095		$	(645,005	)	$	(2,277,519	)	$	25,377,171
Total comprehensive income		—		—		—			—			867,034			(219,795	)		—			647,239
Preferred stock cash dividends (a)		—		—		—			—			(24,940	)		—			—			(24,940	)
Purchases of treasury stock (b)		—		—		—			—			—			—			—			—
Stock-based compensation transactions, net (b)		—		—		15			14,010			(475	)		—			4,817			18,367
Common stock cash dividends — $1.30 per share		—		—		—			—			(216,904	)		—			—			(216,904	)
Balance — June 30, 2023	$	2,010,600	$	89,718	$	972		$	10,000,335		$	16,836,810		$	(864,800	)	$	(2,272,702	)	$	25,800,933

Six Months Ended June 30, 2023
Balance — January 1, 2023	$	2,010,600	$	89,718	$	1,112		$	10,002,891		$	15,753,978		$	(790,030	)	$	(1,750,279	)	$	25,317,990
Total comprehensive income		—		—		—			—			1,568,658			(74,770	)		—			1,493,888
Preferred stock cash dividends (a)		—		—		—			—			(49,881	)		—			—			(49,881	)
Purchases of treasury stock (b)		—		—		—			—			—			—			(599,940	)		(599,940	)
Stock-based compensation transactions, net (b)		—		—		(140	)		(2,556	)		(946	)		—			77,517			73,875
Common stock cash dividends — $2.60 per share		—		—		—			—			(434,999	)		—			—			(434,999	)
Balance — June 30, 2023	$	2,010,600	$	89,718	$	972		$	10,000,335		$	16,836,810		$	(864,800	)	$	(2,272,702	)	$	25,800,933

Three Months Ended June 30, 2022
Balance — April 1, 2022	$	1,750,000	$	79,871	$	1,074		$	6,611,659		$	14,830,671		$	(377,385	)	$	(5,019,870	)	$	17,876,020
Total comprehensive income		—		—		—			—			217,522			(129,105	)		—			88,417
Acquisition of People's United Financial, Inc.:
Common stock issued		—		9,824		—			3,256,821			—			—			5,019,870			8,286,515
Common stock awards converted		—		—		—			104,810			—			—			—			104,810
Conversion of Series H preferred stock		260,600		—		—			—			—			—			—			260,600
Preferred stock cash dividends (a)		—		—		—			—			(24,941	)		—			—			(24,941	)
Purchases of treasury stock		—		—		—			—			—			—			(600,000	)		(600,000	)
Stock-based compensation transactions, net		—		23		16			13,591			(313	)		—			4,095			17,412
Common stock cash dividends — $1.20 per share		—		—		—			—			(214,302	)		—			—			(214,302	)
Balance — June 30, 2022	$	2,010,600	$	89,718	$	1,090		$	9,986,881		$	14,808,637		$	(506,490	)	$	(595,905	)	$	25,794,531

Six Months Ended June 30, 2022
Balance — January 1, 2022	$	1,750,000	$	79,871	$	1,212		$	6,635,000		$	14,646,448		$	(127,578	)	$	(5,081,548	)	$	17,903,405
Total comprehensive income		—		—		—			—			579,696			(378,912	)		—			200,784
Acquisition of People's United Financial, Inc.:
Common stock issued		—		9,824		—			3,256,821			—			—			5,019,870			8,286,515
Common stock awards converted		—		—		—			104,810			—			—			—			104,810
Conversion of Series H preferred stock		260,600		—		—			—			—			—			—			260,600
Preferred stock cash dividends (a)		—		—		—			—			(46,706	)		—			—			(46,706	)
Purchases of treasury stock		—		—		—			—			—			—			(600,000	)		(600,000	)
Stock-based compensation transactions, net		—		23		(122	)		(9,750	)		(643	)		—			65,773			55,281
Common stock cash dividends — $2.40 per share		—		—		—			—			(370,158	)		—			—			(370,158	)
Balance — June 30, 2022	$	2,010,600	$	89,718	$	1,090		$	9,986,881		$	14,808,637		$	(506,490	)	$	(595,905	)	$	25,794,531


Standard	Description	Required date of adoption	Effect on consolidated financial statements
Standards Adopted in 2024
Accounting for Investments in Tax Credit Structures Using the Proportional Amortization Method	The amendments permit an election to account for tax equity investments, regardless of the tax credit program from which the income tax credits are received, using the proportional amortization method if certain conditions are met. Under the proportional amortization method, the initial cost of the investment is amortized in proportion to the income tax credits and other income tax benefits received and the net amortization and income tax credits and other income tax benefits are recognized in the income statement as a component of income tax expense (benefit).	January 1, 2024	As described in note 11, the Company adopted the amended guidance effective January 1, 2024 using a modified retrospective transition. The guidance did not have a material impact on the Company’s consolidated financial statements.


	(In thousands)
Consideration:
Common stock issued (50,325,004 shares)	$	8,286,515
Common stock awards converted		104,810
Cash		1,824
Total consideration		8,393,149

Net assets acquired:
Identifiable assets
Cash and due from banks		395,747
Interest-bearing deposits at banks		9,193,346
Investment securities		11,574,689
Loans and leases		35,840,648
Core deposit and other intangible assets		261,000
Other assets		2,979,388
Total identifiable assets acquired		60,244,818
Liabilities and preferred stock
Deposits		52,967,915
Borrowings		1,389,012
Other liabilities		1,142,387
Total liabilities assumed		55,499,314
Preferred stock		260,600
Total liabilities and preferred stock		55,759,914
Net assets acquired		4,484,904
Goodwill	$	3,908,245


	PCD				Non-PCD
	(In thousands)
Unpaid principal balance	$	3,410,506		(a)	$	32,896,454
Allowance for credit losses at acquisition		(99,000	)	(a)		—
Other discount		(106,814	)			(260,498	)	(b)
Fair value	$	3,204,692			$	32,635,956


	Pro forma
	Six months ended June 30, 2022
	(In thousands)
Total revenues (a)	$	3,900,483
Net income		757,459


	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
	(In thousands)
June 30, 2023
(Dollars in millions)									Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
March 31, 2024
Investment securities available for sale:
U.S. Treasury and federal agencies	$	7,930,292	$	18	$	237,858	$	7,692,452	$	7,818	$	—	$	99	$	7,719
Mortgage-backed securities:
Government issued or guaranteed:
Commercial		634,961		—		19,998		614,963		1,355		1		13		1,343
Residential		2,506,882		105		166,959		2,340,028		3,053		—		143		2,910
Other debt securities		176,323		111		16,218		160,216		171		—		9		162
		11,248,458		234		441,033		10,807,659		12,397		1		264		12,134
Investment securities held to maturity:
U.S. Treasury and federal agencies		1,049,342		—		48,391		1,000,951		1,007		—		33		974
Obligations of states and political subdivisions		2,549,551		2,009		103,344		2,448,216		2,466		—		94		2,372
Mortgage-backed securities:
Government issued or guaranteed:
Commercial		2,029,755		—		148,315		1,881,440		2,035		—		154		1,881
Residential		10,241,181		—		909,050		9,332,131		9,527		—		935		8,592
Privately issued		46,636		9,249		6,768		49,117		41		9		6		44
Other debt securities		1,641		—		—		1,641		2		—		—		2
		15,918,106		11,258		1,215,868		14,713,496		15,078		9		1,222		13,865
Total debt securities	$	27,166,564	$	11,492	$	1,656,901	$	25,521,155	$	27,475	$	10	$	1,486	$	25,999
Equity and other securities:
Readily marketable equity — at fair value	$	219,405	$	2,137	$	3,374	$	218,168	$	351	$	8	$	3	$	356
Other — at cost		972,522		—		—		972,522		928		—		—		928
Total equity and other securities	$	1,191,927	$	2,137	$	3,374	$	1,190,690	$	1,279	$	8	$	3	$	1,284

December 31, 2022
December 31, 2023
Investment securities available for sale:
U.S. Treasury and federal agencies	$	7,913,932	$	200	$	243,172	$	7,670,960	$	7,818	$	—	$	113	$	7,705
Mortgage-backed securities:
Government issued or guaranteed:
Commercial		594,779		—		20,480		574,299		425		—		9		416
Residential		2,501,334		65		171,281		2,330,118		2,272		—		118		2,154
Other debt securities		183,107		250		9,773		173,584		176		—		11		165
		11,193,152		515		444,706		10,748,961		10,691		—		251		10,440
Investment securities held to maturity:
U.S. Treasury and federal agencies		1,054,035		—		45,747		1,008,288		1,005		—		31		974
Obligations of states and political subdivisions		2,577,078		4		116,512		2,460,570		2,501		—		67		2,434
Mortgage-backed securities:
Government issued or guaranteed:
Commercial		912,431		—		103,528		808,903		2,033		—		130		1,903
Residential		8,934,918		1,451		891,063		8,045,306		9,747		4		802		8,949
Privately issued		49,742		8,833		7,987		50,588		42		9		5		46
Other debt securities		1,765		—		—		1,765		2		—		—		2
		13,529,969		10,288		1,164,837		12,375,420		15,330		13		1,035		14,308
Total debt securities	$	24,723,121	$	10,803	$	1,609,543	$	23,124,381	$	26,021	$	13	$	1,286	$	24,748
Equity and other securities:
Readily marketable equity — at fair value	$	153,283	$	2,120	$	3,945	$	151,458	$	266	$	5	$	3	$	268
Other — at cost		780,483		—		—		780,483		859		—		—		859
Total equity and other securities	$	933,766	$	2,120	$	3,945	$	931,941	$	1,125	$	5	$	3	$	1,127


	Less Than 12 Months				12 Months or More				Less Than 12 Months				12 Months or More
	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
	(In thousands)
June 30, 2023
(Dollars in millions)									Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
March 31, 2024
Investment securities available for sale:
U.S. Treasury and federal agencies	$	3,030,061	$	77,628	$	4,657,228	$	160,230	$	2,242	$	10	$	5,177	$	89
Mortgage-backed securities:
Government issued or guaranteed:
Commercial		84,889		2,187		530,074		17,811		765		6		393		7
Residential		599,600		25,579		1,718,645		141,380		813		6		1,964		137
Other debt securities		5,341		388		149,121		15,830		—		—		156		9
		3,719,891		105,782		7,055,068		335,251		3,820		22		7,690		242
Investment securities held to maturity:
U.S. Treasury and federal agencies		49,056		966		951,895		47,425		49		1		925		32
Obligations of states and political subdivisions		585,349		12,092		1,831,988		91,252		43		—		2,284		94
Mortgage-backed securities:
Government issued or guaranteed:
Commercial		1,070,875		42,712		810,565		105,603		172		9		1,709		145
Residential		2,885,964		62,203		6,446,167		846,847		1,133		12		7,459		923
Privately issued		1,986		82		34,677		6,686		—		—		33		6
		4,593,230		118,055		10,075,292		1,097,813		1,397		22		12,410		1,200
Total	$	8,313,121	$	223,837	$	17,130,360	$	1,433,064	$	5,217	$	44	$	20,100	$	1,442

December 31, 2022
December 31, 2023
Investment securities available for sale:
U.S. Treasury and federal agencies	$	6,706,413	$	183,760	$	841,945	$	59,412	$	229	$	1	$	7,474	$	112
Mortgage-backed securities:
Government issued or guaranteed:
Commercial		574,299		20,480		—		—		74		1		330		8
Residential		2,295,873		169,489		28,305		1,792		151		2		1,959		116
Other debt securities		93,458		3,604		73,280		6,169		6		—		154		11
		9,670,043		377,333		943,530		67,373		460		4		9,917		247
Investment securities held to maturity:
U.S. Treasury and federal agencies		1,008,288		45,747		—		—		50		—		924		31
Obligations of states and political subdivisions		2,449,420		116,512		—		—		218		3		2,172		64
Mortgage-backed securities:
Government issued or guaranteed:
Commercial		808,903		103,528		—		—		328		9		1,575		121
Residential		6,292,462		619,403		1,319,300		271,660		955		11		7,139		791
Privately issued		—		—		35,661		7,987		—		—		34		5
		10,559,073		885,190		1,354,961		279,647		1,551		23		11,844		1,012
Total	$	20,229,116	$	1,262,523	$	2,298,491	$	347,020	$	2,011	$	27	$	21,761	$	1,259


Three Months Ended June 30, 2022
Beginning balance	$	307,055		539,444		72,581		553,279		$	1,472,359
Allowance on acquired PCD loans		41,003		55,812		1,833		352			99,000
Provision for credit losses (a)		95,917		120,277		50,168		35,638			302,000
Net charge-offs
Charge-offs (b)		(37,925	)	(8,796	)	(2,863	)	(26,030	)		(75,614	)
Recoveries		8,423		1,656		2,607		13,359			26,045
Net charge-offs		(29,502	)	(7,140	)	(256	)	(12,671	)		(49,569	)
Ending balance	$	414,473		708,393		124,326		576,598		$	1,823,790


Six Months Ended June 30, 2022
Beginning balance	$	283,899		557,239		71,726		556,362		$	1,469,226
Allowance on acquired PCD loans		41,003		55,812		1,833		352			99,000
Provision for credit losses (a)		124,642		89,339		51,888		46,131			312,000
Net charge-offs
Charge-offs (b)		(57,159	)	(10,596	)	(6,835	)	(52,062	)		(126,652	)
Recoveries		22,088		16,599		5,714		25,815			70,216
Net (charge-offs) recoveries		(35,071	)	6,003		(1,121	)	(26,247	)		(56,436	)
Ending balance	$	414,473		708,393		124,326		576,598		$	1,823,790


	Amortized Cost with Allowance		Amortized Cost without Allowance		Total		Amortized Cost			Interest Income Recognized
(Dollars in millions)	March 31, 2024							January 1, 2024		Three Months Ended March 31, 2024
Commercial and industrial	$	590	$	274	$	864		$	670	$	2
Real estate:
Commercial		379		476		855			869		6
Residential builder and developer		3		—		3			3		—
Other commercial construction		33		108		141			171		—
Residential		82		120		202			215		3
Residential — limited documentation		18		35		53			55		1
Consumer:
Home equity lines and loans		48		39		87			81		1
Recreational finance		18		12		30			36		—
Automobile		7		6		13			14		—
Other		54		—		54			52		—
Total	$	1,232	$	1,070	$	2,302		$	2,166	$	13

(Dollars in millions)	March 31, 2023							January 1, 2023		Three Months Ended March 31, 2023
Commercial and industrial	$	227	$	342	$	569		$	504	$	3
Real estate:
Commercial		364		966		1,330			1,240		5
Residential builder and developer		3		—		3			1		—
Other commercial construction		94		49		143			125		2
Residential		125		129		254			272		5
Residential — limited documentation		40		29		69			78		—
Consumer:
Home equity lines and loans		39		42		81			85		2
Recreational finance		24		10		34			45		—
Automobile		23		4		27			40		—
Other		47		—		47			49		—
Total	$	986	$	1,571	$	2,557		$	2,439	$	17


	Amortized cost at June 30, 2023													Amortized cost at March 31, 2024
	Payment Deferral		Interest Rate Reduction		Other		Combination of Modification Types (a)		Total (b)		Percent of Total Loan Class
	(Dollars in thousands)
Three Months Ended June 30, 2023
Commercial, financial, leasing, etc.	$	21,595	$	415	$	—	$	200	$	22,210		0.05	%
(Dollars in millions)														Payment Deferral		Interest Rate Reduction		Other		Combination of Modification Types (a)		Total (b) (c)		Percent of Total Loan Class
Three Months Ended March 31, 2024
Commercial and industrial														$	184	$	—	$	—	$	—	$	184		.32	%
Real estate:
Commercial		55,946		—		—		8,214		64,160		0.17	%		267		—		—		3		270	1.07
Residential builder and developer		85,008		—		—		—		85,008		7.49	%		2		—		—		—		2		.18
Other commercial construction		123,924		—		—		8,248		132,172		1.95	%		131		—		—		—		131	2.11
Residential		38,356		—		—		1,131		39,487		0.17	%		48		—		—		1		49		.22
Residential — limited documentation		3,075		—		—		701		3,776		0.38	%		2		—		—		—		2		.17
Consumer:
Home equity lines and loans		359		135		—		264		758		0.02	%		—		—		—		—		—		—
Recreational finance		69		—		—		—		69		—			—		—		—		—		—		—
Automobile		181		—		—		—		181		—			—		—		—		—		—		—
Other		—		—		—		—		—		—			—		—		—		—		—		—
Total	$	328,513	$	550	$	—	$	18,758	$	347,821		0.26	%	$	634	$	—	$	—	$	4	$	638		.47	%


Six Months Ended June 30, 2023
Commercial, financial, leasing, etc.	$	63,393	$	415	$	—	$	473	$	64,281	0.14	%
													Amortized cost at March 31, 2023
(Dollars in millions)													Payment Deferral		Interest Rate Reduction		Other		Combination of Modification Types (a)		Total (b) (c)		Percent of Total Loan Class
Three Months Ended March 31, 2023
Commercial and industrial													$	70	$	—	$	—	$	—	$	70		.13	%
Real estate:
Commercial		171,361		—		—		8,214		179,575	0.49	%		94		—		—		—		94		.35
Residential builder and developer		90,708		—		—		—		90,708	7.99	%		8		—		—		—		8		.64
Other commercial construction		214,846		—		—		8,248		223,094	3.29	%		92		—		—		—		92	1.39
Residential		69,413		—		—		3,084		72,497	0.32	%		33		—		—		2		35		.15
Residential — limited documentation		8,260		—		—		701		8,961	0.90	%		5		—		—		—		5		.51
Consumer:
Home equity lines and loans		359		135		—		291		785	0.02	%		—		—		—		—		—		—
Recreational finance		203		—		—		—		203	—			—		—		—		—		—		—
Automobile		224		—		—		—		224	0.01	%		—		—		—		—		—		—
Other		—		—		—		—		—	—			—		—		—		—		—		—
Total	$	618,767	$	550	$	—	$	21,011	$	640,328	0.48	%	$	302	$	—	$	—	$	2	$	304		.23	%


	Payment status at June 30, 2023 (amortized cost)								Payment status at March 31, 2024 (amortized cost)
	Current		30-89 Days Past Due		Past Due 90 Days or More (a)		Total
Six Months Ended June 30, 2023	(In thousands)

Commercial, financial, leasing, etc.	$	60,448	$	3,716	$	117	$	64,281
(Dollars in millions)									Current		30-89 Days Past Due		Past Due 90 Days or More (a)		Total
Twelve Months Ended March 31, 2024
Commercial and industrial									$	310	$	7	$	10	$	327
Real estate:
Commercial		177,753		426		1,396		179,575		715		33		24		772
Residential builder and developer		90,708		—		—		90,708		14		39		—		53
Other commercial construction		222,818		276		—		223,094		534		5		—		539
Residential (b)		53,545		14,798		4,154		72,497		112		35		30		177
Residential — limited documentation		6,745		1,600		616		8,961		6		2		—		8
Consumer:
Home equity lines and loans		785		—		—		785		2		—		—		2
Recreational finance		203		—		—		203		—		—		—		—
Automobile		224		—		—		224		—		—		—		—
Other		—		—		—		—		—		—		—		—
Total	$	613,229	$	20,816	$	6,283	$	640,328	$	1,693	$	121	$	64	$	1,878


					Post-modification (a)
	Number		Pre- modification Recorded Investment		Principal Deferral		Interest Rate Reduction		Other		Combination of Concession Types		Total
	(Dollars in thousands)

Three Months Ended June 30, 2022

Commercial, financial, leasing, etc.		40	$	36,983	$	31,514	$	9	$	700	$	5,963	$	38,186
Real estate:
Commercial		13		2,816		1,454		—		—		1,330		2,784
Residential		67		18,481		14,284		—		—		5,038		19,322
Residential — limited documentation		—		—		—		—		—		—		—
Consumer:
Home equity lines and loans		33		2,633		2,597		—		—		93		2,690
Recreational finance		170		6,204		6,204		—		—		—		6,204
Automobile		529		9,771		9,771		—		—		—		9,771
Other		65		465		465		—		—		—		465
Total		917	$	77,353	$	66,289	$	9	$	700	$	12,424	$	79,422


Six Months Ended June 30, 2022

Commercial, financial, leasing, etc.	77	$	46,986	$	38,434	$	9	$	754	$	8,743	$	47,940
Real estate:
Commercial	30		10,398		5,830		—		2,101		2,185		10,116
Residential	164		42,532		29,727		—		—		14,999		44,726
Residential — limited documentation	5		1,076		894		—		—		193		1,087
Consumer:
Home equity lines and loans	68		4,783		4,585		—		—		265		4,850
Recreational finance	347		12,201		12,194		—		—		—		12,194
Automobile	1,063		20,034		20,004		—		—		—		20,004
Other	98		799		799		—		—		—		799
Total	1,852	$	138,809	$	112,467	$	9	$	2,855	$	26,385	$	141,716


	Business Banking		Commercial Banking		Commercial Real Estate		Discretionary Portfolio		Residential Mortgage Banking		Retail Banking		All Other		Total
Three Months Ended June 30, 2023	(In thousands)

Classification in Consolidated Statement of Income
Service charges on deposit accounts	$	20,878		30,230		4,426		—		—		61,678		1,485	$	118,697
Trust income		19		—		—		—		—		—		172,444		172,463
Brokerage services income		—		—		—		—		—		—		25,126		25,126
Other revenues from operations:
Merchant discount and credit card fees		16,927		17,771		1,148		—		—		6,189		327		42,362
Other		—		5,931		1,332		17		211		7,668		1,127		16,286
	$	37,824		53,932		6,906		17		211		75,535		200,509	$	374,934

Three Months Ended June 30, 2022

Classification in Consolidated Statement of Income

Service charges on deposit accounts	$	19,623		29,829		3,742		—		—		68,420		2,556	$	124,170
Trust income		—		—		—		—		—		—		190,084		190,084
Brokerage services income		—		—		—		—		—		—		24,138		24,138
Other revenues from operations:
Merchant discount and credit card fees		16,835		16,854		858		—		—		8,024		278		42,849
Other		—		1,259		3,803		871		1,126		7,673		11,758		26,490
	$	36,458		47,942		8,403		871		1,126		84,117		228,814	$	407,731


	Pension Benefits						Other Postretirement Benefits
	Three Months Ended June 30
	2023			2022			2023			2022
	(In thousands)

Service cost	$	2,952		$	4,543		$	410		$	993
Interest cost on projected benefit obligation		28,888			22,080			662			671
Expected return on plan assets		(50,230	)		(50,083	)		—			—
Amortization of prior service cost (credit)		53			133			(505	)		(311	)
Amortization of net actuarial loss (gain)		(173	)		5,322			(734	)		(416	)
Net periodic cost (benefit)	$	(18,510	)	$	(18,005	)	$	(167	)	$	937


	Investment			Defined Benefit						Total Amount				Income						Investment			Cash Flow			Defined Benefit						Total Amount				Income
	Securities			Plans			Other			Before Tax				Tax			Net
(Dollars in millions)																				Securities			Hedges			Plans			Other			Before Tax				Tax			Net
Balance — January 1, 2024																				$	(251	)	$	(203	)	$	(155	)	$	(7	)	$	(616	)		$	157		$	(459	)
Other comprehensive income (loss) before reclassifications:
Unrealized holding losses, net																					(13	)		—			—			—			(13	)			2			(11	)
Foreign currency translation adjustment																					—			—			—			(2	)		(2	)			—			(2	)
Unrealized losses on cash flow hedges																					—			(243	)		—			—			(243	)			60			(183	)
Total other comprehensive income (loss) before reclassifications																					(13	)		(243	)		—			(2	)		(258	)			62			(196	)
Amounts reclassified from accumulated other comprehensive income (loss) that (increase) decrease net income:
Losses realized in net income																					1			—			—			—			1				—			1
Net yield adjustment from cash flow hedges currently in effect																					—			87			—			—			87		(a)		(21	)		66
Amortization of actuarial losses																					—			—			(1	)		—			(1	)	(b)		—			(1	)
Total other comprehensive income (loss)																					(12	)		(156	)		(1	)		(2	)		(171	)			41			(130	)
Balance — March 31, 2024																				$	(263	)	$	(359	)	$	(156	)	$	(9	)	$	(787	)		$	198		$	(589	)
	(In thousands)

Balance — January 1, 2023	$	(444,192	)		(272,856	)		(349,129	)	$	(1,066,177	)			276,147		$	(790,030	)	$	(444	)	$	(336	)	$	(273	)	$	(13	)	$	(1,066	)		$	276		$	(790	)
Other comprehensive income (loss) before reclassifications:
Unrealized holding gains, net		3,392			—			—			3,392				(2,062	)		1,330			89			—			—			—			89				(24	)		65
Foreign currency translation adjustment		—			—			3,550			3,550				(1,040	)		2,510			—			—			—			2			2				(1	)		1
Unrealized losses on cash flow hedges		—			—			(207,774	)		(207,774	)			51,363			(156,411	)		—			51			—			—			51				(13	)		38
Total other comprehensive income (loss) before reclassifications		3,392			—			(204,224	)		(200,832	)			48,261			(152,571	)		89			51			—			2			142				(38	)		104
Amounts reclassified from accumulated other comprehensive income (loss) that (increase) decrease net income:
Accretion of net gain on terminated cash flow hedges		—			—			(61	)		(61	)	(b)		16			(45	)
Net yield adjustment from cash flow hedges currently in effect		—			—			107,730			107,730		(a)		(26,631	)		81,099			—			59			—			—			59		(a)		(16	)		43
Amortization of prior service credit		—			(927	)		—			(927	)	(c)		36			(891	)
Amortization of actuarial losses		—			(2,457	)		—			(2,457	)	(c)		95			(2,362	)		—			—			(2	)		—			(2	)	(b)		—			(2	)
Total other comprehensive income (loss)		3,392			(3,384	)		(96,555	)		(96,547	)			21,777			(74,770	)		89			110			(2	)		2			199				(54	)		145
Balance — June 30, 2023	$	(440,800	)		(276,240	)		(445,684	)	$	(1,162,724	)			297,924		$	(864,800	)


Balance — January 1, 2022	$	104,691			(360,276	)		83,531		$	(172,054	)			44,476		$	(127,578	)
Other comprehensive income (loss) before reclassifications:
Unrealized holding losses, net		(280,918	)		—			—			(280,918	)			72,691			(208,227	)
Foreign currency translation adjustment		—			—			(7,873	)		(7,873	)			1,961			(5,912	)
Unrealized losses on cash flow hedges		—			—			(174,371	)		(174,371	)			45,129			(129,242	)
Total other comprehensive income (loss) before reclassifications		(280,918	)		—			(182,244	)		(463,162	)			119,781			(343,381	)
Amounts reclassified from accumulated other comprehensive income (loss) that (increase) decrease net income:
Amortization of unrealized holding losses on held-to-maturity securities		1,765			—			—			1,765		(a)		(456	)		1,309
Accretion of net gain on terminated cash flow hedges		—			—			(60	)		(60	)	(b)		17			(43	)
Net yield adjustment from cash flow hedges currently in effect		—			—			(57,966	)		(57,966	)	(a)		15,002			(42,964	)
Amortization of prior service credit		—			(1,128	)		—			(1,128	)	(c)		267			(861	)
Amortization of actuarial losses		—			9,206			—			9,206		(c)		(2,178	)		7,028
Total other comprehensive income (loss)		(279,153	)		8,078			(240,270	)		(511,345	)			132,433			(378,912	)
Balance — June 30, 2022	$	(174,462	)		(352,198	)		(156,739	)	$	(683,399	)			176,909		$	(506,490	)
Balance — March 31, 2023																				$	(355	)	$	(226	)	$	(275	)	$	(11	)	$	(867	)		$	222		$	(645	)


				Defined
	Investment			Benefit
	Securities			Plans			Other			Total
	(In thousands)

Balance — December 31, 2022	$	(329,168	)	$	(202,186	)	$	(258,676	)	$	(790,030	)
Net gain (loss) during period		1,330			(3,253	)		(72,847	)		(74,770	)
Balance — June 30, 2023	$	(327,838	)	$	(205,439	)	$	(331,523	)	$	(864,800	)


					Weighted-						Estimated					Average		Weighted-						Estimated
	Notional		Average		Average Rate						Fair Value			Notional		Maturity		Average Rate						Fair Value
	Amount		Maturity		Fixed			Variable			Gain (Loss) (a)
	(In thousands)		(In years)								(In thousands)
June 30, 2023
(Dollars in millions)														Amount		(In years)		Fixed			Variable			Gain (Loss) (a)
March 31, 2024
Fair value hedges:
Fixed rate long-term borrowings (b) (c)														$	3,850		5.9		3.48	%		5.51	%	$	—
Cash flow hedges:
Interest payments on variable rate commercial real estate loans (b) (d)															23,427		1.7	3.38			5.33				2
Total														$	27,277		2.3							$	2
December 31, 2023
Fair value hedges:
Fixed rate long-term borrowings (b) (e)	$	2,500,000		5.5		3.05	%		5.27	%	$	2,207		$	3,000		5.8		3.45	%		5.62	%	$	(1	)
Cash flow hedges:
Interest payments on variable rate commercial real estate loans (b) (c)		18,727,000		2.0		3.31	%		5.09	%		(74	)
Interest payments on variable rate commercial real estate loans (b) (f)															23,977		1.7	3.45			5.36				11
Total	$	21,227,000		2.4							$	2,133		$	26,977		2.2							$	10
December 31, 2022
Fair value hedges:
Fixed rate long-term borrowings (b)	$	1,500,000		3.3		2.98	%		4.52	%	$	(833	)
Cash flow hedges:
Interest payments on variable rate commercial real estate loans (b) (d)		15,900,000		1.4		1.91	%		4.38	%		(7,059	)
Total	$	17,400,000		1.6							$	(7,892	)


	Asset Derivatives				Liability Derivatives				Asset Derivatives				Liability Derivatives
	Fair Value				Fair Value				Fair Value				Fair Value
	June 30,		December 31,		June 30,		December 31,		March 31,		December 31,		March 31,		December 31,
	2023		2022		2023		2022
	(In thousands)
(Dollars in millions)									2024		2023		2024		2023
Derivatives designated and qualifying as hedging instruments (a)
Interest rate swap agreements	$	3,631	$	1,202	$	1,498	$	9,094	$	3	$	12	$	1	$	2
Commitments to sell real estate loans		9,545		3,037		45		9		11		6		1		8
		13,176		4,239		1,543		9,103		14		18		2		10
Derivatives not designated and qualifying as hedging instruments (a)
Mortgage banking:
Mortgage-related commitments to originate real estate loans for sale		3,137		452		40,315		46,025
Commitments to originate real estate loans for sale										6		15		36		32
Commitments to sell real estate loans		45,080		51,410		47		14		40		35		2		3
		48,217		51,862		40,362		46,039		46		50		38		35
Other:
Interest rate contracts (b)		293,761		355,806		1,234,889		1,278,180		243		237		1,019		879
Foreign exchange and other option and futures contracts		19,636		24,062		18,738		22,004		15		19		13		19
		313,397		379,868		1,253,627		1,300,184		258		256		1,032		898
Total derivatives	$	374,790	$	435,969	$	1,295,532	$	1,355,326	$	318	$	324	$	1,072	$	943


	Amount of Gain (Loss) Recognized
	Three Months Ended June 30
	2023					2022
	Derivative			Hedged Item		Derivative			Hedged Item
	(In thousands)
Derivatives in fair value hedging relationships
Interest rate swap agreements:
Fixed rate long-term borrowings (a)	$	(46,429	)		47,202	$	(20,683	)		20,762

Derivatives not designated as hedging instruments
Interest rate contracts (b)	$	11,153				$	5,808
Foreign exchange and other option and futures contracts (b)		3,160					4,493
Total	$	14,313				$	10,301


		Carrying Amount of the Hedged Item				Cumulative Amount of Fair Value Hedging Adjustment Increasing (Decreasing) the Carrying Amount of the Hedged Item							Carrying Amount of the Hedged Item				Cumulative Amount of Fair Value Hedging Adjustment Increasing (Decreasing) the Carrying Amount of the Hedged Item
		June 30, 2023		December 31, 2022		June 30, 2023			December 31, 2022
		(In thousands)
(Dollars in millions)													March 31, 2024		December 31, 2023		March 31, 2024			December 31, 2023
Location in the Consolidated Balance Sheet of the Hedged Items in Fair Value Hedges	Location in the Consolidated Balance Sheet of the Hedged Items in Fair Value Hedges											Location in the Consolidated Balance Sheet of the Hedged Items in Fair Value Hedges

Long-term debt		$	2,394,614	$	1,433,731	$	(100,493	)	$	(65,310	)

Long-term borrowings													$	3,742	$	2,954	$	(104	)	$	(44	)


	Fair Value Measurements		Level 1		Level 2		Level 3
	(In thousands)
June 30, 2023
(Dollars in millions)									Fair Value Measurements		Level 1		Level 2		Level 3 (a)
March 31, 2024
Trading account	$	137,240	$	137,240	$	—	$	—	$	99	$	99	$	—	$	—
Investment securities available for sale:
U.S. Treasury and federal agencies		7,692,452		—		7,692,452		—		7,719		—		7,719		—
Mortgage-backed securities:
Government issued or guaranteed
Commercial		614,963		—		614,963		—		1,343		—		1,343		—
Residential		2,340,028		—		2,340,028		—		2,910		—		2,910		—
Other debt securities		160,216		—		160,216		—		162		—		162		—
		10,807,659		—		10,807,659		—		12,134		—		12,134		—
Equity securities		218,168		211,341		6,827		—		356		343		13		—
Real estate loans held for sale		538,306		—		538,306		—		728		—		728		—
Other assets (a)		374,790		—		371,653		3,137
Other assets (b)										318		—		312		6
Total assets	$	12,076,163	$	348,581	$	11,724,445	$	3,137	$	13,635	$	442	$	13,187	$	6
Other liabilities (a)		1,295,532		��		1,255,217		40,315
Other liabilities (b)									$	1,072	$	—	$	1,036	$	36
Total liabilities	$	1,295,532	$	—	$	1,255,217	$	40,315	$	1,072	$	—	$	1,036	$	36

December 31, 2022
December 31, 2023
Trading account	$	117,847	$	117,847	$	—	$	—	$	106	$	101	$	5	$	—
Investment securities available for sale:
U.S. Treasury and federal agencies		7,670,960		—		7,670,960		—		7,705		—		7,705		—
Mortgage-backed securities:
Government issued or guaranteed
Commercial		574,299		—		574,299		—		416		—		416		—
Residential		2,330,118		—		2,330,118		—		2,154		—		2,154		—
Other debt securities		173,584		—		173,584		—		165		—		165		—
		10,748,961		—		10,748,961		—		10,440		—		10,440		—
Equity securities		151,458		145,289		6,169		—		268		258		10		—
Real estate loans held for sale		162,393		—		162,393		—		379		—		379		—
Other assets (a)		435,969		—		435,517		452
Other assets (b)										324		—		309		15
Total assets	$	11,616,628	$	263,136	$	11,353,040	$	452	$	11,517	$	359	$	11,143	$	15
Other liabilities (a)		1,355,326		—		1,309,301		46,025
Other liabilities (b)									$	943	$	—	$	911	$	32
Total liabilities	$	1,355,326	$	—	$	1,309,301	$	46,025	$	943	$	—	$	911	$	32


	~~Other Assets and Other Liabilities~~
~~2023~~	~~(In thousands)~~

~~Balance — April 1, 2023~~	$	(~~28,141~~	)
~~Total losses realized/unrealized:~~
~~Included in earnings~~		(~~895~~	)	~~(a)~~
~~Transfers out of Level 3~~		(~~8,142~~	)	~~(b)~~
~~Balance — June 30, 2023~~	$	(~~37,178~~	)
~~Changes in net unrealized gains (losses) included in earnings related to instruments still held at June 30, 2023~~	$	(~~2,102~~	)	~~(a)~~

~~2022~~

~~Balance — April 1, 2022~~	$	(~~15,428~~	)
~~Total losses realized/unrealized:~~
~~Included in earnings~~		(~~6,609~~	)	~~(a)~~
~~Transfers out of Level 3~~		(~~2,144~~	)	~~(b)~~
~~Balance — June 30, 2022~~	$	(~~24,181~~	)
~~Changes in net unrealized gains (losses) included in earnings related to instruments still held at June 30, 2022~~	$	(~~8,441~~	)	~~(a)~~


	Other Assets and Other Liabilities
	(In thousands)
2023
Balance — January 1, 2023	$	(45,573	)
Total gains realized/unrealized:
Included in earnings		16,456		(a)
Transfers out of Level 3		(8,061	)	(b)
Balance — June 30, 2023	$	(37,178	)
Changes in net unrealized gains (losses) included in earnings related to instruments still held at June 30, 2023	$	10,543		(a)

2022
Balance — January 1, 2022	$	6,440
Total losses realized/unrealized:
Included in earnings		(25,309	)	(a)
Transfers out of Level 3		(5,312	)	(b)
Balance — June 30, 2022	$	(24,181	)
Changes in net unrealized gains (losses) included in earnings related to instruments still held at June 30, 2022	$	3,405		(a)


		~~Fair Value~~			Valuation Technique	Unobservable Inputs / Assumptions	Range (Weighted- Average)
		~~(In thousands)~~
~~June 30, 2023~~
~~Recurring fair value measurements~~
~~Net other assets (liabilities) (a)~~		$	(~~37,178~~	)	~~Discounted cash flow~~	~~Commitment expirations~~	0~~% -~~ 97~~% (~~10%)

~~December 31, 2022~~
~~Recurring fair value measurements~~
~~Net other assets (liabilities) (a)~~	��	$	(~~45,573~~	)	~~Discounted cash flow~~	~~Commitment expirations~~	0~~% -~~ 97~~% (~~3%)