MTB - Earnings call transcript Q3 2024

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Operator

Welcome to the M&T Bank Third Quarter 2024 Earnings Conference Call. [Operator Instructions]

Please be advised that today's conference is being recorded. I would now like to hand the conference over to Brian Klock, Head of Market and Investor Relations. Please go ahead.

Brian Klock

good and Todd, you, morning. Thank thank I'd Third through participating M&T's for XXXX like the Earnings and to Quarter telephone Conference in by everyone Call, webcast. both

morning, earnings you financial the schedules our we If read to and access the going www.mtb.com. not issued along have tables this website, you by with may it release

along webcast. Once there, the the to may SEC like our are been contain information. and before Cautionary investor release point. Presentations mention on today's materials the for Events as in I'd well filings information has provided this and forward-looking link also presentation the Relations that today's as in you and Investor other can presentation and statements investor those start, we included following Most Also earnings click on and on captioning then about materials.

includes also are identified in earnings release non-GAAP investor in GAAP the as financial appropriate appendix. included to and Presentation reconciliations the The presentation. measures

Vice M&T's the on me Joining Executive call CFO, morning is Daryl Bible. Senior President this and

I'd Daryl. call over like to the to Now turn

Daryl Bible

Brian, and good you, everyone. morning, Thank

results As quarter call, hear today's continued dynamic M&T's environment. the on through third will economic strength you a represent

support We we communities serve. our that continue to

provide growth consecutive and County. ranging million Syracuse We inclusion and New nation's among Bank England, M&T XX SBA $XX Westchester to the third Connecticut, financial top launched recently York, nonprofits New on economic [indiscernible] lenders, For is will and our Long XXth #X the which Buffalo, year, Baltimore, D.C. focused in the Delaware, across Washington, Island of phase

Scope renewable energy interim and recently emissions. our XXX% environmental use We reduction X with of X establishing updated including offsetting XXXX and several also targets for goals, by electricity

Slide X. Turning to

trade products consumer, business and organizations. awards from employees continue receive Our to and

X, the which the Turn quarter. third to of results Slide shows

concentration. income margin in grew quarter grow successes interest we continue we interest we to highlight. out results As to we Net this to our reducing on progress plans press loans release, continue laid and There as the CRE are January. make morning's while third sequentially released net as our noted in several

quarter average CRE the we over growing nearly and fact, grown XXXX, while reducing and $X $X C&I billion of In consumer have by since loans. by fourth loans billion

you Funding was grew our basis decline those a the foregone divestitures. resiliency to achieved income our Noninterest repurchase a business our the cost X third program ratio of exclude point We the in from high of on was quarter reached third this our liabilities. if fee X businesses in prior with interest-bearing CETX income This demonstrating well sold point model. the share share diversified $XXX in executed considering even quarter costs and repurchases X gains managed strength in restarted over the quarter, XX.X%. the in by million and and

balances in nonaccrual and quality a Asset criticized this the charge-offs with outlook. and quarter to reduction both net improve commercial below year loans full continued

Now in the earnings Diluted third quarter. let's look at $X.XX second quarter, third the from GAAP the quarter. $X.XX were per improved the for specifics for share

third at or an quarter value million X%. EPS $XX third a the book per growing of the results million Net in quarter quarter, CETX produced respectively. strong benefit increase share and M&T's XX.XX%, note, tangible an end to an tax XX%. million for was quarter linked at and and the quarter Of X.XX% of $XXX XX.XX% grew discrete third the remained $X.XX the of benefit. income of included ROA ROCE compared ratio $XXX The

income quarter. ROTCE from for of $X.XX was and the the an for the results in third recent and earnings a quarter operating per of operating quarter. Net XX.XX% Slide X $XXX income for basis. with operating includes tangible quarter. supplemental $XXX million M&T's Diluted the compared X.XX% million the operating reporting net recent in and net $X.XX yielded up on second share ROTA were quarter linked M&T's net

let's equivalent from quarter Taxable or deposit margin asset was in Positive funding third X.XX%, of from Slide and points a interest X results. portfolio Next, by for deeper quarter. and margin mix, drivers The turn $X.XX X. income costs, partially Please mix positive a point points The the the from underlying of from little basis increase offset mostly the X positive nonaccrual points negative linked a a investment interest to consumer our negative primary million of interest the second other net and X% all fixed $X repricing, generated X were basis was net from lower basis into earning that X loans. basis billion, an asset trends to quarter. look points basis X an basis the increase and increase from X points wholesale items. the

Nonaccrual $XX in million interest million $XX to amounted second quarter. to compared the

saw dealer loans Slide Average loans. talk Turning decline last outpaced the C&I and to quarters, trend XX leases C&I banking, grew $XX.X by commercial the similar to loans what lending. to in in and services, billion, mortgage we warehouse increases X% to average $XXX.X about several CRE. that slightly fund to growth billion, increased driven franchise

loans. end paydowns indirect billion. were CRE our loans capital declined the and market floor $XX $XX.X manage at were in quarter. the billion as increased offset largely continue loans finance continued fixed CRE rate plan unchanged interest mix declined second concentration. utilization lower low while X% third the X.XX% utilization of Loan billion, CRE unchanged relatively a from shift. slower we the result sales to estimated new and as a nonaccrual quarter [indiscernible] was dealer repricing loan to Residential as Tier at originations and Middle model percent reflecting X% allowance is of by yields growth loans of mortgage auto of and as grew modestly benefit $XX.X arrivals. reflecting at to Consumer and be X auto to recreational

Turning to Slide XX.

X The cash investment held and increased securities fourth maturing $X the as at quarter, the totaled the of reinvest. representing yield maturing increased The at billion. securities including $X.X to in have strong. of Our $XX liquidity an cash, securities. yield total third securities end to points investment the the basis In quarter, yield billion, At X.X%, average remains exceeded new purchases we of the Fed, intend on X.X% on on average we assets. securities which yield XX% billion

included The basis quarter duration X of the and investment at regulatory portfolio CETX end was on unrealized years, gain million benefit was of X.X $XX available-for-sale the capital. pretax portfolio the or the if in points the

a on we deposits. are a non-broker $X.X pleased deposits X% Business or decline declined deposits XX. [indiscernible], and and Slide to We performance. $X deposits. total to $XXX.X remain billion reflecting grew Average billion to customer Turning loans and growing more deposits rate-sensitive focused deposit $X.X billion the quarter, sequentially broker as overall from deposits Banking second with in decline consumer manage declined continue in the while Commercial average total and

$X.X Average trust expected continued $XX.X from billion commercial decline noninterest-bearing an and deposits billion declined demand consumer. modest and deposits deal-related to in disintermediation within

average deposits, third deposit points Interest-bearing in X XX.X%. broker was mix decreased basis deposit the quarter to costs Excluding noninterest-bearing X.XX%.

compared market sales the million, linked $X and quarter. in to quarter income fees Trust fees tax Continuing $XXX second on Noninterest at compared Slide was ICS. the were of income second $XXX $XXX to $XXX quarter. the performance from prep seasonal Mortgage equity by quarter million performance with prior million in million, offset $XXX strong XX. million unchanged was million

million. the Commercial quarter in origination of $XX uptick million increased number million in reflecting to mortgage commercial, activity. quarter. increased the revenues $XXX operations at consumer and charges from the fees were to to days linked processing Service from from million, $X million $XXX an $X related both the mostly Other unchanged

Slide Noninterest expenses $XX working an to $XXX the of million Salary second $X reflecting to X million, increase benefits increased day. quarter. $X.X XX. Turning from billion, were additional and million

under the and mostly assessment. million various litigation from stemming Other quarter. XX% reflecting unchanged $XX the million from prior decreased Visa. was million, of costs efficiency $X increased M&T's special $XXX $XX agreements insurance to share by from The ratio certain driven largely million second quarter losses of Deposit operations to incremental obligation

basis from million C&I upgrades and out from to $X.X million the downs. million, or basis credit. X quarter. In basis we several ratio X X.XX%, charge-off The turn to billion. nonaccruals quarter of in net Nonaccrual for million. XX Slide for CRE represented a office decrease as million $XXX X in large points pay with provision a to compared charge-offs nonaccrual well loans nonaccrual Let's largest X to $XX driven points were as largely loan. XX $XX of decreased X% of totaled linked quarter CRE XX points, and $XXX or Net the decreased by the quarter, loans in recorded down combined and $XXX charge-offs the payoffs The third a

improvements we from a improvement and in quarter in macroeconomic million compared we weeks, C&I our will the offset the decline quality in driven level linked criticized at June. Please $XX.X in CRE ratio to loan to The certain $XX.X X.XX% of a improvements as result continued that in growth point $XXX When in balances. X few billion be to outlook, loans at end The criticized XX-Q the basis estimate $XXX allowance to of Form a of turn was by and billion decline million decreased partially Slide XX. by portfolios. file the asset

most finance mostly manufacturing XX vehicle detail the industries, other criticized finance ratios dealers segments motor smaller service on C&I reflects debt decline within and profit and in the segment. RV motor the recreational balances. changes balance normalizing the largest decreases improvements with C&I criticized The vehicle across Slide the within margins provides additional recreational were within and coverage dealers and

was improved allowed performance CRE declines as repayment criticized health saw occupancy types, and declining office. health Slide for viable balances. most continued in decline CRE borrowers support except uptick to The projects. property other construction modifications the with loan and criticized on by continue curtailments and growth, within modest more with largest but and rates, long-term combined activity XX takeouts. we includes construction care, an more for aided declines rent detail Within were criticized these in as in A improvements in project care

that [indiscernible] factor the largest drove quarter. quarters of occurred the amount prior The that in versus was upgrades

negative end from for compared was million CETX basis AOCI strong estimated third CETX would The and on XX XX.XX% the the second ratio at the to a be end for impact combined the in the Slide the share of quarter. was pension-related earnings continued to points. and strong the ratio components increase of the At of third due to at XX.XX% an sale approximately and available capital. quarter, Turning $XXX quarter securities M&T quarter. third end X repurchase the

Now XX turning for the to outlook. Slide

economic market we mild recession impact to we the and slowed, but on remains slowed, had spending Though scenario economy landing a alleviating remains projected. to for expected a has healthy. probability, quarter, nearly has The the Recently, stronger labor services. growth backdrop. in target remains with highest brought by as pressure come soft having resilient the GDP begin third The Let's with than of in consumer and Fed's The the for possibility inflation inflation rate returned X%. hikes. lagged goods many see the has

Now turning to outlook. the

the for year last NII update. full from our unchanged is outlook Our

the charge-offs X ranges quarters from focus While the we complete, expenses through will outlook the and from January initially That in maintained full fees, is we for unchanged quarter. on with net the the the fourth year. discussed outlook year and said,

be near we expect to margin end the interest the at be the a in taxable low $X.XX year Net least to expected implying NII range previously. of NII We full billion, is [indiscernible]. equivalent provided top

points has that year. in Our of outlook curve incorporates forward an rate basis cuts end additional the by the XX the latest

total We are to focus as growth expected to on and CRE of billion billion approximately loans and lower $XXX deposits. average expect be we growing customer Total C&I balances. core growth at $XXX and in continue continued deposits with loan consumer least

first interest quarter. deposit the expected interest-bearing expect We in the Security for approximately couple balances to to XX% continue beta cuts. rate grow of are of fourth

fourth the noninterest categories. million, in offset quarter $XXX by for partially is trust other income reflecting mortgage about continued outlook Our fee strength and

are expenses. coming the due investment quarter reflects closely key expenses, initiatives managing of including priorities our online. projects continued Fourth to intangible $X.XX billion about to our timing amortization, in This be expected are and

to for be year basis XX near points. to continue expect full We net the charge-offs

approximately Our $XX tax the the preferred quarter. million the for outlook to in is We dividends share about XX.XX% and to plan be fourth continue fourth are the for repurchase rate million. quarter the expected $XXX

including Slide underscore on results a model shareholders. has with a an investment stakeholders, business benefits M&T been always XX, that To organization successful purpose-driven thesis. all optimistic conclude our

We of remain economic outperforming we have while within credit markets the record consistent dividend growth. cycles, a long growing focused shareholder serve. track returns all on and We through

of steward Finally, prudent and capital. we are acquirer a shareholder disciplined

our which will Now questions to briefly operator open the review call before let's instruction.

Operator

[Operator Instructions] with will Cassidy from come Markets. Gerard question Capital Our first RBC

Gerard Cassidy

capital to Daryl, a and shareholders. over managing returning job capital in their the has excess great done years, M&T

increase again CETX game, at to ratio fourth do today an Basel You're is the have into pointing think what once forward buyback so there, a you ratio quarter. you the you and that could very optimal us get strong out where share the your you the is the CETX get on with level. in share you we going XX.X% go repurchases you III end And to expect. also final XXXX? as know guys And Can

Daryl Bible

Yes. Thanks, Gerard.

of to First, I it strong into fourth a we a have have impact as forward comes negative with to we the and have CETX XXXX. AOCI, capital of really we capital end start of no and when ratio That generation. we want the XX.X%. into continue on just with that said, move to flexibility quarter lot And the

to But if increases grow to continues sign slow at impact will that continue The economy. now. to could We to share the we down, look economy potential repurchase.

progress criticized now great they've come made on down X our loans, quarters. We've consecutive

to We it that CRE our be expect that fourth pipeline want we And exposure now, we be. quarter is believe is from to a in also starting criticized. we And are strong point we're decrease perspective. the at the really now where to build

believe plays I capital a as out, dollar long more probably of we'll to about. ratio. as return So I shareholders as it target what and CETX more We amounts just mentioned in switched talked XXXX,

back ratio might do stay want on how growth if the repurchases RWA in much loan that So say and we to and CETX for example, that XX% on buy above and growth sheet. depends we we we'll have XXXX, balance

working in quarter targets and what so. we'll our I we're would is next on XX% know that higher the you than about long need probably something long-term to But have term. or say

Gerard Cassidy

-- big slope based the get you're like that because And the in X are income know interest the balance quarter kind positive If forward looks end out income has you net out your the growth to funds It helpful. and forward I'm margins won't just X.X% then that follow-up, possibly rate if it's year, that the like is asking and I curve Slide curve, is these interest and upon correct, and until and But looks of net for your first correct Very possibly just and frame curve know not Fed net guidance possibly interest accelerate a good. is I this January. but income next a going in can come to if sheet, growing correct, lower X% on the Very and that from should bottomed as -- 'XX based it interest you're ifs, growing gradually obviously seeing expanding. the and of the rates but the we based Fed Fed continue to and aside by XXXX, troughed.

Brian Klock

scenario. with rosy start off a You very

hard as past happy really are And net on we happened interest started really the team really neutral rates. me income lowering worked that year this has Let say and just our 'XX. that Fed just in

very for we fortunate So that. were

roll good your on get If on, portfolios. what's and those at know fixed really as lot to you models. I rates we look really off going it's -- of and into roll understand hard have analysts our you numbers for that a asset and

positively raising RV, look mortgage quarter. at portfolio, to and But all [indiscernible] and if this investment those continue you reprice our

quarter We expect XXXX. that and to continue next into

a for us. that's So positive

that For curve sloping enhance would potentially.

strong have. It side, is foundation On see that the of Gerard. our strength deposit just it's company, we the I our

of we downward about of talked the the We're XX%. have an previously. deposits. That's higher at that stable now seeing strong, really range We beta end core initial operating

So that's strong.

improvements that you already hedging, hedges. we look have swap our hedges our locked we going reprice know when at And in basically in book we're to

[indiscernible]. points to at you point-to-point If don't should basis up point points point, should XX rates look change. if in That's the go the hedges, value and cash basis go about about they XX up even fair flow hedges

from very So positive that's there. probably

when loan things out have eke we're Plus, a shrinking on. growing we able of to growth. we CRE, lot were good we loans, So going were even

performing our as both our So are C&I businesses. consumer CRE businesses on and side as well the really well,

have we we as move would we I forward that. continue So positive say to benefit as grow mix

confidence margin So net improve. of NII, me lot continue that interest a to that gives should

Operator

Our America. Ebrahim question with next of Bank from Poonawala will come

Ebrahim Poonawala

Just question a on you the loans -- criticized mentioned declined.

really step could Just wondering, on And down process or go much it updated borrowers? stair we big do I like criticized thought loans some decline the we result today need appraisals, your year is to at for Does these when from implications? coming XX% where you, get don't as are quarters? rates change at know, CETX a ratio lower And point the reserve come CRE early what financials the next the X.XX? over to a see

Daryl Bible

upgrades more the actually occurring, Yes. quarter, rates the in that, getting we rates prepared a have biggest in that's and tell Ebrahim. this in would is down. lot with several we're What and that our roles. obviously, versus question, I out we Thanks coming from quarter remarks, But When actually quarters the for of difference you upgrades now. good can is past third had fall, the the I paydowns pointed takeouts

more started health their had, that's If they better, we the really really positive occupancy care and flowing sector you in specifically operations to rents cash look that were our positive. and improve were and

paying that remember book is current. You in have that our to have we criticized in total, XX%

So good. that's really really,

amount, book, you just the and CRE driven that really the that seeing rates you're and If also by fair that our stabilization marketplace, in also construction we a dropped interest look was at have. projects that

we're the supporting credits has strong really and client lend with is to. want get them. to selection right they they We are believe seeing we that all you're of are committed come and really now clients M&T really seeing things hold on strengths upgrades. the to And that as this their have through, you're people come that to to the One through of and really lending our starting

significant to saw RV The X really and perspective. that excess helped thing upgrade They from get is an XXXX, in our dealers. were dealers, able quarter of that had other we this RV their rid inventory

very so probably that. have Ebrahim, a there think a we be of direct down, line won't positive and lot I but down, I momentum [indiscernible] have is we and trajectory feel definitely about the So think I

Ebrahim Poonawala

Darryl, maybe, just mentioned And Understood. so growth. of drivers loan you

good through partly here? Is few from of had the Or kind by going levels? kind growth coming done somewhat driven quarters. acquisition third you of from runoff this flatline You quarter footprint C&I are still the there? the be still the we Could last with that to that pretty in CRE? Peoples is and And acquired declining

Daryl Bible

Yes.

So let first. the CRE with me start

So in pipelines are our building CRE.

had while there. pipelines a haven't large We for

So seeing balance to pipelines growing We it's CRE, probably for take are to hit couple get fill we confidence CRE. But start making good really be CRE up it going but be won't of us as portfolio. me shrinking we'll into we gives a on that in progress And and those quarters XXXX. the sheet. our

So it's another oar in from us growth from momentum a the that. water that will perspective more give revenue

that's positive. think very I So

we fund As first the far soft out, was quarter play have, were franchise, this a we that little quarter, businesses quarter, mean, growth. saw but specialty the the we finished quarter really and all as I strong growers were strong. part really quarter. institutional, of it continued our the growth this mortgage When you warehouse in banking, corporate

lot You have fourth can in a going quarter. momentum see balances, loan into the and it end-of-period we of

have, go New middle all Baltimore, would regions that you to really Virginia, are and York our at When areas and Richmond, there good. PA, that's Jersey, the our really positive. So highlight those be market, continue progress that we look Austin

lending have revenue say would momentum side the the about and good feel that I we projections So on we good have.

Ebrahim Poonawala

don't on the one December And Got of X here? we the those, just November, cut outlook at rate get response get in fourth or we the follow-up previous change . it. from on least Gerard. to a NII quarter does your that in NIM If

Daryl Bible

on on our Everything was Ebrahim that interest structural that in I going balance said sheet rates. has going that's no through impact list,

So they down. up if go I going rates comfortable we're if feel flat that or up or actually stay

complexities neutral but you relatively hard it's percentage, interest be We're and that can balance we're exact, from nuts when an to and the sheet the be with you as rate have. risk

that income. net So interest I have an on we and feel good trajectory upward margin

Operator

next Stanley. come Manan Morgan will Our with Gosalia question from

Manan Gosalia

So on ask beta. I deposit wanted to

assuming think a you deposit I that you beta XQ. XX% noted in

if I deposit betas closer way to recall on XXs Now correctly. up or the the mid

XQ the year see on expect betas So betas to get do . that go the and cuts you rate saw we from accelerate that closer more you you and next into as will way up? as

Daryl Bible

Yes.

I down, up my up, about very least I were, are way a quarter. where mind the think the will back think you or whatever, businesses end feel -- of all simple peaked a feel we we're that probably been if get equal, our forward lowering But fourth we good to going get really how at our the that do at betas I there. to but that of went at But what hopefully think pace think it good positive but It's we'll good down able point. in at repricing we'll maybe the XXXX. we into XX% really some and we've XX% about being it's I I on felt move end that beta to things at quickly September. And don't XX% as have rates. continue And I

we a lot the in had company. of was that planning good There

good with good strategies Our come feel really really where treasury we've implementation, headed. good up hard we're team the and that really at worked tested businesses with all to and and

Ebrahim Poonawala

as we start loan to it. like Got -- I then -- as speaking that sounds loans. were into mean, in the of build CRE get growth you it will growth And loan year, on accelerate just the next about, just terms you as

they there cash slower and quarter. deposits little is bring that cash do some balances? to grow year? that you go room to didn't this that of there terms a year? funding In maybe balances noticed utilize room Or expect bit with next grow growth deposits Is line the loan next much down down growth, I in to loan

Daryl Bible

being big trying the our [indiscernible] the to rates, to always get always are always a out always the means is We customers. all that operate from When deposits. say deposits. basically customer deposits on. I I'm believer had out there we'll company on, there won't quarters of that what asking want we but rates, be for lowest pay highest in pay won't X we growth we consecutive We've of

focus will We to on customer growing deposits. continue

it's growing think you to if important in loans, I think of so you that. don't go a you [indiscernible], circle deposits all you're a need and if grow

need going to move shrink able grow to So I and like do that. noncore if be with to forward. you actually to to continue than you our able continue some faster honest that's we're loans, funding, would if deposits of to

Ebrahim Poonawala

Got it.

like stay you would expect pay So cash? as noncore away securities well funding. core grow, this some it balances to Or of that from cash? down And you move sounds the of to continue deposits at you as grow the level would

Daryl Bible

are where at right the have look between billion now, you we If we two. about $XX

We more us. investment methodical into money out are really increasing putting all portfolio increases, our very and that's been well portfolio. for year we've Again, the and played investment

from a we in end XXXX the be ] in and saw [ X% increases year, of sometime nice probably the X.XXs had first early towards yield perspective. You quarter will the

continue we to investment grow portfolio. So will our

the in then reevaluate out. quarter, how plays $X fourth in and have and maturing $X billion probably we'll the quarter. in We 'XX billion see We'll invest fourth

operate we Fed. right with we will we cash at sitting we where billion cash $XX-plus Fed. are probably $XX a Right Fed billion I No lot now, have than the go perspective, about the a flexibility at at just of on we're lower much think now. probably that. But at won't From

a got flexibility. we lot So of

Operator

Our next Spahr question Christopher with Wells Fargo. come will from

Christopher Spahr

question . period a Can just it me So better on -- Or bad? the is still hear now? loan you

Daryl Bible

I now, yes. can

Christopher Spahr

Okay.

that. about Sorry

Just billion, bit the to CRE just you that in more XXXX. a -- for quarter there runoff little stabilizes? do stabilizing relative fourth some see portfolio more some of period is paydowns in the if $XXX that loans upside Or and then and into to end

Daryl Bible

Yes.

CRE to going for a think at I you're quarters. in see more least couple runoff

to quarter, pipelines from for or quarter, construction the depends kind type perspective. moving going that making, But we're in that CRE being projection. mix build our operate and from sure, maybe quarter, we're it loan quarter, about First permanent have to of that whether what how book that forward second of with fourth we're quickly is first loans of XX% of our on it's loans kind going

So it's pipelines are team job move great and to as forward. building, do of and try a communities and needs his and the will clients meet our we Peter

the -- way, balances expect grow right but but year wouldn't it do we'll CRE So I to mid-next until conservatively.

Christopher Spahr

kind in questions, Okay. the actually is And have timing, wipe to that then loans CRE. lower the basis it then of like [indiscernible]. during the out that the the earlier last. quarter, points back you XXX Do could just criticized said And getting in rates effectively I that correct? if so,

Daryl Bible

the got part, get didn't I the first [indiscernible]. I Yes, last part. .

Christopher Spahr

Apologies about the connection.

the points in CRE. the timing get criticized the on the XXX timing benefits lower that what's the of you of what's -- Just do basis if the for curve,

Daryl Bible

Yes.

I like out. good don't I to wipe don't appropriate. So and that's criticized. trajectory think word use the we a have downward

staying long-term and long they their We and we as that our working have with I are with as a when history, them to Chris, stressful clients will will. support do of loans things continue that

criticized -- very some us. always just So DNA. going who in our clients It also loans to to loyal we makes our that's we're have are

we down. quarter that. believe wipe do do will feel But that's aren't to trajectory out continue good we a I from to going perspective. that But the with trajectory continue and fourth So balances. really that down I all good criticized going in XXXX

Operator

Rochester Dave with question from come will Our next Point. Compass

David Rochester

Nice quarter. .

Daryl Bible

Thank you.

David Rochester

close of front, part I that's thoughts On the a you so the noninterest-bearing deposits? still that you've are outlook curious about And appreciate runoff bit part a been within little deposit broker on the you a in running But in how noninterest-bearing piece side for of beta, that know we you're XX% deposit mentioned. that? as drop factoring . were what I deposits, you those that deposit are to was XQ. can I on decline off on outlook. a the more that your the talking about talk

Daryl Bible

bearing, So consumer commercial a wouldn't look forward. down say but that might much side the when I occurs, at I disintermediation very you would our little say that of significantly. be bit we as noninterest move and really There is slowed

what just volatile. have, from our though, that in of be think ICS is function business. we balances those are we you bearing I tend our who And have to is noninterest balances a

sometimes, And you swings back and see of that forth. going

out have to all several quarters try around I when from some perspective. playing we average exclude but you're our part, going broker out volatility XX% you think we We said that, with the most ago that that noninterest-bearing, and I for that. point that's we'd what deposits will thought But those think to

So really feel from good noninterest-bearing perspective. a I

thing, think benefit less, it's free work And value getting you I forward, higher noninterest-bearing. spreads the the rate our that so aren't keep interest we're as the key out. down, we because as of have as and into how We're aware you harder to of that. come to much look deposits from margins rates definitely just plays

David Rochester

Okay. Great.

the appreciate loan for drivers gave to switching XQ. color I on all growth. you the Just

. competitive within start down the actually was I just to be those mean, a specialty could When about great. up you utilization you think the I market middle that mentioned expect bit. overall, and meaningfully? landscape C&I talk move that you lines do little would if more utilization to more

Daryl Bible

services. lots commercial, more in seems there's still within I have is cars more that a up. did said, -- net-net increase, we utilization It now, like Well, lot the the dealer our like driving But is which on down. Yes.

in to on that be defaulting lot a a that to And talk you needs of actually they as are we good to the happen. clients a matter have that we there It's pin lot That's the could hard the post hard when of as But today. and our over to will growth for can just time. marketplaces. us. you down, Some we're things of when honest I with be of market places, need working to there when It's in election. what we people serve, and seem be markets will we clients it be in going think

If grow. at to you actually look can our lines, lines continue

making more available lines So for we're clients. our actually

and and on customers that our growing start will eventually, are accounts draw to from they we So perspective them.

Operator

will Frank with from Piper question next Schiraldi Sandler. come Our

Frank Schiraldi

moving last loan X there's lot guess a just of parts growth. I on mean know I X here. I

of for the you X% as building, You to sort could talk quarter which of [indiscernible] growth quarters pretty number. you a linked forward you Do maybe bogey? a a more X% trough. even bogey . next average unannualized do there $XXX pipelines billion be from quarter. going from couple growth, mentioned in that would that quarter, that's about think think maybe quarterly linked decent see accelerate even Is sort Or of you good

Daryl Bible

maybe the love We're That's customers little the it's to tell and most less bit our XXXX, anywhere to more say average, still maybe we're would than a that -- continuously you the or would I be answer midst that. planning Frank, give do our I take. of to going we season now. for from X%, right in X% support communities. thing do bit an to X% to the important thing right might little I a than

is customers very out we we as we We that the with growth business that get do from said, in But prudent the marketplace. in much are as -- think selective that. will

our We to credit stretch going or and all aren't levels change that.

on see call. plays more earnings just that we'll next color it but So I'll out, you how give

Frank Schiraldi

yields terms rates they the mentioned to. a we with think for then could seeing enough. you're the aside I repricing quarterly you of you get And the for where set also security or we back now repricing about think are the yields give loan book talked you we on of And rate the If basis currently, where purposes, . Fair the sit of just what from modeling book. about the is of -- kind repricing, sort you color book? side think of you what sort a loan in pickup and movements any can minute, just on back Okay. on of just where

Daryl Bible

Yes.

give this a what level of seeing high you on I'll quarter. past So we're

at is all all in categories. CRE point C&I rate of XXX averaging off, rate -- rolling about together you what's up on. fixed basis consumers X% a is about fixed C&I that X.X%. The X.X%. over around at on off when these and look X%, we'll loan rate little So all at up Mortgage you averaging portfolio, averaging Net-net, our benefit. is blend look if about on, The it's about rolling rolling loan are the loans fixed

Operator

Our next question will come ISI. from John Pancari with Evercore

John Pancari

the us terms leverage Could look thoughts expenses, term. type you operating thoughts is operating of operating Curious like near mean, I full points believe implies 'XX. you as now, give to outlook positive I It what year in leverage looking of looks you right about achievable. leverage you what XXXX, is operating continued In into leverage guys XXX positive your possible that as into positive your this on you some we put on up your basis good is the some pretty XXX look for acceleration at Street quarter. -- believe

Daryl Bible

Yes.

do XXX% I will figured putting have and XXX end confident for will there. think it, get will where out, very feel we're have I we're from still we believe XXX, on we So kind are the to will leverage plan get operating neighborhood agreed I positive XXXX but of XXXX. that. everybody's but together. we we there of in or Whether you're out

expenses fourth projects to the up guided, you If at due the that we a bit It's little have. they we quarter. were that look in mainly

amount a increase company, have We progress. there. in have We making a and an of fair of do we're going projects the lot on

just from of good deposit is getting and progress growth thing a and made good pretty we've other some good performance a our on asset good financially. We our improving The loan year perspective, we're that quality priorities had doing -- accomplished. and both and

for payout corporate-wide So be with good still XXXX XXXX quarter to increasing to is fourth in a year. honest we said, for for feel are That you. everybody actually year than going our I that incentives the better be a

a it making positive and in about to to the happen are have more people continue progress. that we need lot But good make to do the of a momentum reward now lot and have that. work We feel company and

John Pancari

I and that there. side, reserve you'll you now. points then as basis in you see that right. percentage or helpful. assume trending and on do decline guess, stands ticked assume of around to a then here credit in loss continued decline All a look good to Fair the quarter, XXX quarter that Where as out? down criticized trajectory modest fair your Great. cited it here? where this a pretty You ratio . ratio? the expected That's see the loans Is that so bit And loan

Daryl Bible

Yes.

some past when quarter, macro you helped drop that had with positives in is downward think it, at more creepy this good and look criticized, we much factor I positive and being drive good. which

balance occur part, all forward, change though, definitely you growing lending yields, charge-offs. look most higher seeing that are a as of with side. so categories, the And heavy consumer is mix they more change Consumers mix that we and think I have come spreads also you in overall our for you're but on have, higher the net sheet. the

So you're seeing a mix change.

happens. it that, change a now, So than how be lower mix that, than operating little really now depends where a It it's that XX%. higher on right quick Could around good be possibly. maybe. really bit right we're little we're it Could feeling

overall getting sure we're look putting spread have that obviously, on good it. our we're on net a from and making I returns We assets balance the sheet. at

good use So capital our shareholders. for a it's

really little thing much we of play potentially more the more we just shift out couple over could But CRE. be a were John, company, have not so really the higher diversification. from So we're think a trying doing years perspective. but as bit little bit I get XXX% think that that diversified. diversified never to much having mix charge-off right We XXX%, to a relying much of are it's try the more we company on next

strong as marketplace. businesses like of lot as a out great and businesses in CRE businesses consumer So businesses, fee wealth have C&I well the and ICS we

present So diversified as move you investors -- more we that that, I we at all a the all and mean really of we're talking look things if it's the at company forward. really

John Pancari

. Very helpful.

Operator

will Our Deutsche come O'Connor question from next Bank. with Matt

Unknown Analyst

to Nathan Matt you it's expect it be trajectory X.XXs on ask in strong I of it -- This is NIM O'Connor. given and behalf quarter quarter. wanted next the about Stein this low X.XX% to at came

So strong sense changed given X.XXs this high the regarding how I Have think date? your is X.XX the of NIM been for half thoughts to range September, in to your above the year. the it's prior said NIM be a guide in next you year. In second makes trajectory

Daryl Bible

repricing in feel XX% a earnings do in quarter give the we roll roll next well good about you you loan and have, good X.XXs that we'll low and our positive So off really really assets on It we on deposit going the what I side. for we're comfortable on we would tell our the and is I and rates momentum rate that think call fourth when January reactivity as fixed is margin, guidance well.

we So of a positive have lot I think momentum.

Unknown Analyst

interchange it come trend line I how line you those then that come forward? a Okay. bit it syndication Did but revenues Great. you expect of And with down levels. bit in And helps And kind XQ suggested else this fees. to lower had was was think something nuanced and in of revenue do a then previously on going other would question, Or better you fee kind expected? these? a than

Daryl Bible

other, syndications really within and the say that's drives the and fees. largest category merchant items tend those be loan and categories that most Those other for X I well, going to Yes. would are what the card that X or line part. very

Operator

will question with next Our Westerlind from UBS. Zach come

Unknown Analyst

onetime those This kind run that quarter. Can clarify is I is that on a just in the stay Erika. question. are fourth of that to projects? type there for know to the had follow-up projects going Zack rate? on you just hit Or in some are I expected if you quick the were mentioned expense

Daryl Bible

a Zack. It's mix,

to coming in we're rate. Some be are on of putting the things quarter, centers our online that new that online, going data come run like that's fourth

also the fourth expenses more have expensed being that. that project are We in some quarter that from have we

we'll give a leverage and feel and really there. good good that specifics positive 'XX that, guidance January. you to more I you going it's give in have as we're January give I so I So XXXX, have you good we said, strong get in We'll in about operating projections. mix think But like we

Unknown Analyst

made Can remind think just a looking charge-offs around how of kind net Helpful. Appreciate pretty then you're you that. us trending better front. down, number thoughts share quality the trends to about bunch if able just Clearly, credit of you good. you And progress credit your that? on with charge-off have through-the-cycle guys

Daryl Bible

changes, if historically our of charge-off cycle through more portfolio question, is earlier But look consumer an having basis that changing. the loan on And portfolio mix as the what mix So good a we're allowance said or that points. you good. I is look is XX loans, those balances. sure we still capital making make a percentage loans loans on spread return that at just It's have good the total that there. that it We on net of to as drive higher will

more a So change continue it's company It's nothing to a mix forward. be as that it's be that concerned diversified to you have moving we just about.

Operator

you. like Klock would this for At call over time, to Brian remarks. Thank additional to I turn the or closing back any

Brian Klock

a of Thank or day. any participating the great Investor (XXX) is And clarification at as code please today. area always, department call XXX-XXXX. for you and news the in all you release thank Relations Again, if our items of contact necessary, have

Operator

This Bank Conference Quarter M&T Third conclude you. Call. the does XXXX Thank Earnings

may your this day. have a lines disconnect and great time, at You

M&T Bank (MTB) 17 Oct 242024 Q3 Earnings call transcript