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

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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 improved in the third quarter of 2024 as compared with the second quarter of 2024 reflecting a decline in provision for credit losses, higher other income and a modest increase in net interest income. Following four FOMC federal funds target interest rate increases totaling 100 basis points in the first three quarters of 2023, interest rates remained elevated resulting in higher deposit and borrowing costs which adversely impacted net interest income for the nine months ended September 30, 2024 as compared with the similar 2023 period. Those costs have since stabilized. In September 2024, the FOMC decreased the federal funds target interest rate by 50 basis points. That interest rate reduction had little impact on the Company's results of operations for the three and nine months ended September 30, 2024. Other income in the first nine months of 2023 included a $225 million gain on the sale of the Company's CIT business in April 2023. A summary of financial results for the Company is provided below:

SUMMARY OF FINANCIAL RESULTS


	Three Months Ended						Change				Nine Months Ended						Change
(Dollars in millions, except per share)	September 30, 2024			June 30, 2024			Amount		%		September 30, 2024			September 30, 2023			Amount		%
Net interest income	$	1,726		$	1,718		$	8	—	%	$	5,124		$	5,393		$	(269)	-5	%
Taxable-equivalent adjustment (a)	13			13			—		2		38			41			(3)		-9
Net interest income (taxable-equivalent basis) (a)	1,739			1,731			8		1		5,162			5,434			(272)		-5
Provision for credit losses	120			150			(30)		-20		470			420			50		12
Other income	606			584			22		4		1,770			1,950			(180)		-9
Other expense	1,303			1,297			6		—		3,996			3,930			66		2
Net income	721			655			66		10		1,907			2,259			(352)		-16
Per common share data:
Basic earnings	4.04			3.75			0.29		8		10.83			13.09			(2.26)		-17
Diluted earnings	4.02			3.73			0.29		8		10.78			13.05			(2.27)		-17
Performance ratios, annualized
Return on:
Average assets	1.37		%	1.24		%					1.21		%	1.48		%
Average common shareholders’ equity	10.26			9.95							9.47			12.33
Net interest margin	3.62			3.59							3.58			3.91

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*(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 preferred equity securities, is based on a composite income tax rate of approximately 25%.

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The increase in net income in the recent quarter as compared with the second quarter of 2024 resulted from the following:

Net interest income on a taxable-equivalent basis increased slightly reflecting an expansion of the net interest margin by 3 basis points as the cost of interest-bearing liabilities decreased while yields on earning assets remained unchanged from the immediately preceding quarter.
Provision for credit losses declined $30 million reflecting a decrease in criticized commercial real estate and commercial and industrial loans, partially offset by commercial and industrial and consumer loan growth.
Other income increased $22 million reflecting an increase in service charges on deposit accounts, favorable trading account and other non-hedging derivative gains and lower losses on bank investment securities.

The decline in net income for the nine months ended September 30, 2024 as compared with the same 2023 period reflects the following:

Net interest income on a taxable-equivalent basis declined $272 million reflecting a narrowing of the net interest margin by 33 basis points as higher deposit and borrowing costs outpaced increased yields on the Company's earning assets.
Provision for credit losses increased $50 million reflecting the impact of higher interest rates on the performance of commercial borrowers and loan growth.
Other income in the first nine months of 2024 declined $180 million as compared with the first nine months of 2023 reflecting the sale of the CIT business in April 2023, partially offset by higher service charges on deposit accounts and a rise in residential mortgage banking revenues.
Other expense in the first nine months of 2024, excluding $34 million of FDIC special assessment expense, rose $32 million from the similar 2023 period. Those higher expenses included an increase in salaries and employee benefits expense and outside data processing and software costs, partially offset by lower professional and other services expense and other costs of operations.

The Company's effective income tax rates were 20.7% and 23.4% for the quarters ended September 30, 2024 and June 30, 2024, respectively, and 21.5% and 24.5% for the nine-month periods ended September 30, 2024 and 2023, respectively. The recent quarter income tax expense reflects a $14 million discrete tax benefit related to certain tax credits claimed on a prior year income tax return. The first quarter of 2024 income tax expense reflects a $17 million net discrete tax benefit related to the resolution of an income tax matter inherited from the acquisition of People's United. Each of the discrete income tax benefits noted herein contributed to the lower effective income tax rate for the nine-month period ended September 30, 2024 as compared with the nine-month period ended September 30, 2023.

On August 15, 2024, M&T redeemed all 350,000 outstanding shares of its Perpetual Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series E, for $350 million. On May 13, 2024, M&T issued 75,000 shares of Perpetual Non-Cumulative Preferred Stock, Series J, with a liquidation preference of $10,000 per share. Additional information about the issued and outstanding preferred stock of M&T is included in note 6 of Notes to Financial Statements.

M&T repurchased 1,190,054 shares of its common stock in accordance with its capital plan during the recent quarter at an average cost per share of $166.40 resulting in a total cost, including the share repurchase excise tax, of $200 million. No share repurchases occurred in the first or second quarter of 2024. During the first nine months of 2023, M&T repurchased 3,838,157 shares of its common stock at an average cost per share of $154.76 resulting in a total cost, including the share repurchase excise tax, of $600 million.

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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.

SUPPLEMENTAL REPORTING OF NON-GAAP RESULTS OF OPERATIONS


	Three Months Ended						Change				Nine Months Ended						Change
(Dollars in millions, except per share)	September 30, 2024			June 30, 2024			Amount		%		September 30, 2024			September 30, 2023			Amount		%
Net operating income	$	731		$	665		$	66	10	%	$	1,939		$	2,295		$	(356)	-16	%
Diluted net operating earnings per share	4.08			3.79			0.29		8		10.97			13.26			(2.29)		-17
Annualized return on:
Average tangible assets	1.45		%	1.31		%					1.28		%	1.57		%
Average tangible common equity	15.47			15.27							14.51			19.70
Efficiency ratio	55.0			55.3							57.0			52.6
Tangible equity per common share (a)	$	107.97		$	102.42		$	5.55	5	%	$	107.97		$	93.99		$	13.98	15	%

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*(a)*At the period end.

The efficiency ratio measures the relationship of noninterest operating 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 Company’s 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), and reconciliations of GAAP amounts with corresponding non-GAAP amounts are presented in Table 2.

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Taxable-equivalent Net Interest Income

Interest income earned on certain of the Company's assets is exempt from federal income tax. Taxable-equivalent net interest income 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


	Three Months Ended
	September 30, 2024						June 30, 2024
(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	$	59,779	$	1,054	7.01	%	$	58,152	$	1,018	7.04	%
Commercial real estate	29,075		466		6.27		31,458		506		6.38
Residential real estate	22,994		253		4.41		23,006		249		4.32
Consumer	22,903		387		6.72		21,972		362		6.61
Total loans and leases, net	134,751		2,160		6.38		134,588		2,135		6.38
Interest-bearing deposits at banks	25,491		348		5.43		29,294		400		5.50

Trading account	101		1		3.40		99		1		3.47
Investment securities (b):
U.S. Treasury and federal agencies	27,304		246		3.60		25,809		220		3.43
Obligations of states and political subdivisions	2,411		24		3.83		2,443		23		3.81
Other	1,308		19		5.69		1,443		23		6.47
Total investment securities	31,023		289		3.70		29,695		266		3.61
Total earning assets	191,366		2,798		5.82		193,676		2,802		5.82
Allowance for credit losses	(2,208)						(2,199)
Cash and due from banks	1,764						1,754
Other assets	18,659						18,750
Total assets	$	209,581					$	211,981
Liabilities and shareholders’ equity
Interest-bearing liabilities:
Interest-bearing deposits:
Savings and interest-checking deposits	$	98,295	$	655	2.65	%	$	95,955	$	618	2.59	%
Time deposits	17,052		180		4.19		19,802		217		4.41
Total interest-bearing deposits	115,347		835		2.88		115,757		835		2.90
Short-term borrowings	4,034		57		5.60		4,962		69		5.62
Long-term borrowings	11,394		167		5.83		11,490		167		5.83
Total interest-bearing liabilities	130,775		1,059		3.22		132,209		1,071		3.26
Noninterest-bearing deposits	46,158						47,734
Other liabilities	3,923						4,293
Total liabilities	180,856						184,236
Shareholders’ equity	28,725						27,745
Total liabilities and shareholders’ equity	$	209,581					$	211,981
Net interest spread					2.60						2.56
Contribution of interest-free funds					1.02						1.03
Net interest income/margin on earning assets			$	1,739	3.62	%			$	1,731	3.59	%

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*(a)*Includes nonaccrual loans.

*(b)*Includes available-for-sale securities at amortized cost.

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


	Nine Months Ended
	September 30, 2024						September 30, 2023
(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	$	58,256	$	3,059	7.01	%	$	53,877	$	2,660	6.60	%
Commercial real estate	31,069		1,498		6.34		34,823		1,652		6.26
Residential real estate	23,045		749		4.33		23,707		723		4.06
Consumer	22,009		1,092		6.63		20,320		898		5.90
Total loans and leases, net	134,379		6,398		6.36		132,727		5,933		5.98
Interest-bearing deposits at banks	28,467		1,167		5.48		24,871		942		5.07

Trading account	102		3		3.43		136		3		3.02
Investment securities (b):
U.S. Treasury and federal agencies	25,917		657		3.39		24,199		523		2.89
Obligations of states and political subdivisions	2,448		70		3.80		2,550		71		3.72
Other	1,408		62		5.90		1,332		53		5.24
Total investment securities	29,773		789		3.54		28,081		647		3.08
Total earning assets	192,721		8,357		5.79		185,815		7,525		5.41
Allowance for credit losses	(2,188)						(1,974)
Cash and due from banks	1,735						1,809
Other assets	18,740						18,616
Total assets	$	211,008					$	204,266
Liabilities and shareholders’ equity
Interest-bearing liabilities:
Interest-bearing deposits:
Savings and interest-checking deposits	$	96,379	$	1,888	2.62	%	$	88,184	$	1,140	1.73	%
Time deposits	19,138		622		4.34		15,751		441		3.74
Total interest-bearing deposits	115,517		2,510		2.90		103,935		1,581		2.03
Short-term borrowings	5,071		210		5.53		5,961		223		5.01
Long-term borrowings	10,887		475		5.82		7,092		287		5.42
Total interest-bearing liabilities	131,475		3,195		3.24		116,988		2,091		2.39
Noninterest-bearing deposits	47,498						57,277
Other liabilities	4,202						4,305
Total liabilities	183,175						178,570
Shareholders’ equity	27,833						25,696
Total liabilities and shareholders’ equity	$	211,008					$	204,266
Net interest spread					2.55						3.02
Contribution of interest-free funds					1.03						.89
Net interest income/margin on earning assets			$	5,162	3.58	%			$	5,434	3.91	%

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*(a)*Includes nonaccrual loans.

*(b)*Includes available-for-sale securities at amortized cost.

Expressed on a taxable-equivalent basis net interest income was $1.74 billion in the third quarter of 2024, compared with $1.73 billion in the second quarter of 2024. The $8 million increase in taxable-equivalent net interest income in the recent quarter reflects a 3 basis-point expansion of the net interest margin, or taxable-equivalent net interest income expressed as an annualized percentage of average earning assets, from the second quarter of 2024 to 3.62% in the recent quarter. That expansion reflects a stable yield on earning assets as higher yields on investment securities offset a decline in the yield on interest-bearing deposits at the FRB of New York, and a decrease in the cost of interest-bearing liabilities reflecting reduced funding levels from short-term borrowings and brokered time deposits. The Company continues to adjust its funding sources in consideration of the changing interest rate environment as well as the competitive landscape for customer deposits. Average brokered deposits and average short-term

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borrowings declined by $1.1 billion or 9% and $928 million or 19%, respectively, when comparing the recent quarter with the second quarter of 2024.

Taxable-equivalent net interest income in the first nine months of 2024 was $5.16 billion, compared with $5.43 billion in the corresponding 2023 period. That decrease reflects a 33 basis-point narrowing of the net interest margin to 3.58% in the 2024 period from 3.91% in the year-earlier period as higher rates paid on interest-bearing liabilities outpaced an increase in yields on earning assets. An increase in average interest-bearing liabilities in the first nine months of 2024 as compared with the first nine months of 2023 reflected a shift in customer deposits toward higher cost interest-bearing products, including time deposits, and higher average brokered deposits and borrowings. Average interest-bearing deposits rose $11.6 billion or 11% in the first nine months of 2024 as compared with the first nine months of 2023 and included an increase in average brokered deposits of $1.5 billion or 14%. Average borrowings rose $2.9 billion or 22% when comparing the first nine months of 2024 with the same 2023 period. The increase in average earning assets in the first nine months of 2024 reflects higher average deposits at the FRB of New York, purchases of investment securities and loan growth.

Lending activities

The Company's lending activities in 2023 and for the first nine months of 2024 reflect its execution of various strategies to reduce its relative concentration of commercial real estate loans. The following table summarizes average loans and leases for the three-month and nine-month periods ended September 30, 2024 and percentage changes in the major components of the portfolio.

AVERAGE LOANS AND LEASES


			Percent Change from				Percent Change from
	Three Months Ended		Three Months Ended		Nine Months Ended		Nine Months Ended
(Dollars in millions)	September 30, 2024		June 30, 2024		September 30, 2024		September 30, 2023
Commercial and industrial	$	59,779	3	%	$	58,256	8	%
Commercial real estate	29,075		-8		31,069		-11
Residential real estate	22,994		—		23,045		-3
Consumer:
Recreational finance	11,583		6		10,949		19
Automobile	4,649		6		4,408		5
Home equity lines and loans	4,557		—		4,571		-5
Other	2,114		2		2,081		1
Total consumer	22,903		4		22,009		8
Total	$	134,751	—	%	$	134,379	1	%

Average loans and leases totaled $134.8 billion in the third quarter of 2024, up nominally from the second quarter of 2024.

Average commercial and industrial loans and leases were $59.8 billion in the recent quarter, up $1.6 billion from the second quarter of 2024, reflecting growth that spanned most industry types.
Commercial real estate loans averaged $29.1 billion in the third quarter of 2024, down $2.4 billion from the second quarter of 2024, reflecting decreases of $1.9 billion and $472 million of average permanent and construction commercial real estate loans, respectively.
Average consumer loans in the third quarter of 2024 increased $931 million from the second quarter of 2024 to $22.9 billion. That growth reflects an increase in average balances of recreational finance loans and automobile loans of $633 million and $255 million, respectively.

In the first nine months of 2024, average loans and leases totaled $134.4 billion, up $1.7 billion or 1%, from $132.7 billion in the corresponding 2023 period.

Average commercial and industrial loans and leases in the first nine months of 2024 increased $4.4 billion from the similar 2023 period, reflecting growth across most industries, predominantly lending to the services and the financial and insurance industries and to motor vehicle and recreational finance dealers.

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Average commercial real estate loans declined $3.8 billion in the first nine months of 2024 as compared with the corresponding 2023 period reflecting decreases of $2.7 billion in average permanent commercial real estate loans and $1.1 billion in average construction loans.
Average residential real estate loans decreased $662 million in the nine months ended September 30, 2024 from the first nine months of 2023. That decrease was largely attributable to customer payments on loans held for investment.
Average consumer loans in the first nine months of 2024 increased $1.7 billion from the first nine months of 2023. That growth reflected higher average balances of recreational finance and automobile loans of $1.7 billion and $205 million, respectively, partially offset by a decline in the average balance of home equity loans and lines of credit of $251 million.

Investing activities

The investment securities portfolio averaged $31.0 billion in the third quarter of 2024, up $1.3 billion from the second quarter of 2024. That increase reflects the purchase of $4.0 billion of U.S. Treasury securities and government issued or guaranteed commercial and residential mortgage-backed securities in the recent quarter. In the first nine months of 2024 and 2023, investment securities averaged $29.8 billion and $28.1 billion, respectively. The rise in average balances in the first nine months of 2024 as compared with the similar 2023 period reflects purchases of U.S Treasury securities and government issued or guaranteed commercial and residential mortgage-backed securities of $11.2 billion during the first nine months of 2024. The Company sold $71 million of non-agency investment securities from its available-for-sale portfolio during the first nine months of 2024. There were no significant sales of investment securities during the nine months ended September 30, 2023. The Company routinely adjusts its holdings of capital stock of the FHLB of New York and the FRB of New 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 commercial and residential mortgage-backed securities and U.S. Treasury securities, but also includes municipal and other securities. When purchasing investment securities, the Company considers its liquidity position and its overall 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.

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 each of the nine months ended September 30, 2024 and 2023. A further discussion of fair values of investment securities is included herein under the heading "Capital." Additional information about the investment securities portfolio is included in notes 3 and 13 of Notes to Financial Statements.

Other earning assets include interest-bearing deposits at banks and trading account assets. Those other earning assets in the aggregate averaged $25.6 billion in the recent quarter, compared with $29.4 billion during the three months ended June 30, 2024, and $28.6 billion in the nine months ended September 30, 2024, compared with $25.0 billion in the nine months ended September 30, 2023. The amounts of other earning assets at those respective dates were predominantly comprised of deposits held at the FRB of New York. In general, the levels of those deposits often fluctuate due to changes in deposits of retail and commercial customers, trust-related deposits, brokered deposits and additions to or maturities of investment securities or borrowings.

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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 represented 77% and 76% of average earning assets for the quarters ended September 30, 2024 and June 30, 2024, respectively, and 77% and 80% for the nine months ended September 30, 2024 and 2023, respectively. The Company also includes brokered deposits as a component of its wholesale funding strategy. Depending on market conditions, including demand by customers and other investors, and the cost of funds available from alternative sources, the Company may change the amount or composition of brokered deposits in the future. The following table provides an analysis of changes in the components of average deposits.

AVERAGE DEPOSITS


			Percent Change from				Percent Change from
	Three Months Ended		Three Months Ended		Nine Months Ended		Nine Months Ended
(Dollars in millions)	September 30, 2024		June 30, 2024		September 30, 2024		September 30, 2023
Noninterest-bearing deposits	$	46,158	-3	%	$	47,498	-17	%
Savings and interest-checking deposits	89,464		2		88,026		4
Time deposits of $250,000 or less	11,698		-6		12,029		69
Total core deposits	$	147,320	—	%	$	147,553	-1	%

Time deposits greater than $250,000	$	3,240	-9	%	$	3,404	72	%
Brokered deposits	10,945		-9		12,058		14
Total deposits	$	161,505	-1	%	$	163,015	1	%

Deposits averaged $161.5 billion in the recent quarter, a $2.0 billion decrease from $163.5 billion in the second quarter of 2024.

Average core deposits decreased modestly when compared with the second quarter of 2024 and reflected a shift in customer funds from noninterest-bearing accounts and time deposits to savings and interest-checking accounts.
The decrease in average brokered deposits in the recent quarter reflects a continued shift in the Company's wholesale funding strategy. Average brokered time deposits decreased 45% to $2.1 billion in the recent quarter from $3.8 billion in the second quarter of 2024. The rates paid on those deposits averaged 4.87% and 4.99% during the three months ended September 30, 2024 and June 30, 2024, respectively. Average brokered savings and interest-checking accounts increased 8% to $8.8 billion in the recent quarter from $8.2 billion in the second quarter of 2024. The rates paid on those deposits averaged 4.65% and 4.75% during the three months ended September 30, 2024 and June 30, 2024, respectively. The rate paid on total non-brokered interest-bearing deposits during the three months ended September 30, 2024 was 2.68%, up nominally from 2.67% for the quarter ended June 30, 2024, reflecting a stabilization in non-brokered deposit product pricing in 2024.

Average deposits increased $1.8 billion in the first nine months of 2024 from $161.2 billion in the corresponding 2023 period.

Average core deposits decreased $1.1 billion in the nine months ended September 30, 2024 as compared with the similar 2023 period reflecting the impact of an elevated interest rate environment that influenced customers to seek higher rate alternatives, including a shift of funds to certain commercial sweep products and time deposits greater than $250,000.

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The increase in average brokered deposits in the nine months ended September 30, 2024 as compared with the first nine months of 2023 reflects the Company's liquidity management and funding strategies during a period of rising interest rates, partially offset by the maturity of some brokered time deposits in the recent nine-month period. Average brokered time deposits decreased $2.9 billion to $3.7 billion in the first nine months of 2024 from $6.6 billion in the nine months ended September 30, 2023 and the rates paid on those deposits averaged 4.98% and 4.95%, respectively. Average brokered savings and interest-checking accounts increased $4.4 billion to $8.4 billion in the nine months ended September 30, 2024 from $3.9 billion in the nine months ended September 30, 2023 and the rates paid on those deposits averaged 4.72% and 3.94%, respectively. The rate paid on total non-brokered interest-bearing deposits was 2.68% in the first nine months of 2024, compared with 1.74% in the similar 2023 period. That increase in the rate on non-brokered interest-bearing deposits reflected repricing on certain deposit products as customers sought higher yields in an elevated interest rate environment.

The accompanying table summarizes the components of average total deposits by reportable segment for the three months ended September 30, 2024 and June 30, 2024 and the nine months ended September 30, 2024 and 2023.

AVERAGE DEPOSITS BY REPORTABLE SEGMENT


(Dollars in millions)	Commercial Bank		Retail Bank		Institutional Services and Wealth Management		All Other		Total
Three Months Ended September 30, 2024
Noninterest-bearing deposits	$	11,970	$	24,638	$	8,864	$	686	$	46,158
Savings and interest-checking deposits	31,858		51,729		8,274		6,434		98,295
Time deposits	346		14,546		41		2,119		17,052
Total	$	44,174	$	90,913	$	17,179	$	9,239	$	161,505

Three Months Ended June 30, 2024
Noninterest-bearing deposits	$	12,523	$	25,150	$	9,340	$	721	$	47,734
Savings and interest-checking deposits	30,003		51,655		7,895		6,402		95,955
Time deposits	426		15,501		43		3,832		19,802
Total	$	42,952	$	92,306	$	17,278	$	10,955	$	163,491

Nine Months Ended September 30, 2024
Noninterest-bearing deposits	$	12,648	$	25,055	$	9,094	$	701	$	47,498
Savings and interest-checking deposits	30,532		51,553		7,769		6,525		96,379
Time deposits	375		15,012		40		3,711		19,138
Total	$	43,555	$	91,620	$	16,903	$	10,937	$	163,015

Nine Months Ended September 30, 2023
Noninterest-bearing deposits	$	18,065	$	29,047	$	9,476	$	689	$	57,277
Savings and interest-checking deposits	23,630		53,488		7,247		3,819		88,184
Time deposits	309		8,778		17		6,647		15,751
Total	$	42,004	$	91,313	$	16,740	$	11,155	$	161,212

- 53 -

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				Nine Months Ended
(Dollars in millions)	September 30, 2024		June 30, 2024		September 30, 2024		September 30, 2023
Short-term borrowings:
Federal funds purchased and repurchase agreements	$	219	$	292	$	272	$	439
FHLB advances	3,815		4,670		4,799		5,522
Total short-term borrowings	$	4,034	$	4,962	$	5,071	$	5,961

Long-term borrowings:
Senior notes	$	7,089	$	7,088	$	6,866	$	5,470
FHLB advances	2,005		2,005		1,778		5
Subordinated notes	636		976		862		979
Junior subordinated debentures	542		541		541		537
Asset-backed notes	1,112		870		830		91
Other	10		10		10		10
Total long-term borrowings	11,394		11,490		10,887		7,092
Total borrowings	$	15,428	$	16,452	$	15,958	$	13,053

The Company uses borrowing capacity from banks, the FHLBs, the FRB of New York and others as sources of funding. Short-term borrowings represent arrangements that at the time they were entered into had a contractual maturity of one year or less. The lower levels of short-term borrowings in the third quarter of 2024 as compared with the second quarter of 2024 as well as for the nine months ended September 30, 2024 as compared with the similar 2023 period reflect the Company's management of liquidity.

Long-term borrowings averaged $11.4 billion and $11.5 billion in the three-month periods ended September 30, 2024 and June 30, 2024, respectively. In the recent quarter the Company issued $650 million of asset-backed notes secured by equipment finance loans and leases and $400 million of fixed-rate subordinated notes matured. For the nine-month periods ended September 30, 2024 and 2023, long-term borrowings averaged $10.9 billion and $7.1 billion, respectively. The increased usage of borrowing facilities in the 2024 period reflects the Company's strategies to diversify its wholesale funding sources 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 M&T's 2023 Annual Report.

Additional information regarding borrowings is provided in notes 5 and 12 of Notes to Financial Statements.

Net interest margin

Taxable-equivalent 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 yield on earning assets and the rate paid on interest-bearing liabilities, was 2.60% in the recent quarter, up 4 basis points from 2.56% in the second quarter of 2024. The increase in the net interest spread from the second quarter of 2024 reflected stable yields on average earning assets and a decrease in the cost of interest-bearing liabilities. The yield on earning assets during the third quarter of 2024 was 5.82%, unchanged from the second quarter of 2024. The yield on investment securities increased 9 basis points reflecting purchases of investment securities in the recent quarter with a higher yield than maturing securities. That increase was offset by a decline in the yield on interest-bearing deposits at the FRB of New York. The yield on loans was unchanged from 2024's second quarter. The rate paid on interest-bearing liabilities was 3.22%, down 4 basis points from the second quarter of 2024 reflecting reduced funding from short-term borrowings and brokered time deposits. For the first nine months of 2024, the net interest spread was 2.55%, down from 3.02% in the corresponding year-earlier period.

- 54 -

Higher rates paid on interest-bearing deposits and borrowings that outpaced higher yields earned on investment securities, loans and other earning assets, largely contributed to that decline in net interest spread.

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 $60.6 billion in the third quarter of 2024, down from $61.5 billion in the second quarter of 2024. Net interest-free funds averaged $61.2 billion and $68.8 billion in the first nine months of 2024 and 2023, respectively. Noninterest-bearing deposits averaged $46.2 billion in the third quarter of 2024, compared with $47.7 billion in the second quarter of 2024, and $47.5 billion in the first nine months of 2024 as compared with $57.3 billion in the first nine months of 2023. The declines in average noninterest-bearing deposits in the respective comparative periods reflect customer use of off-balance sheet investment products and a shift in deposits to interest-bearing accounts in an environment of elevated interest rates. The contribution of net interest-free funds to net interest margin was 1.02% in the third quarter of 2024, compared with 1.03% in the second quarter of 2024. In the first nine months of 2024 and 2023, the contribution of net interest-free funds to net interest margin was 1.03% and .89%, respectively. The increased contribution of net interest-free funds to net interest margin in the first nine months of 2024 as compared with the first nine months of 2023 reflects higher rates paid on interest-bearing liabilities used to value net interest-free funds.

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 3.62% in the third quarter of 2024, compared with 3.59% in the second quarter of 2024. During the first nine months of 2024 and 2023, the net interest margin was 3.58% and 3.91%, respectively. That 33 basis-point narrowing of the net interest margin reflects an increase in the rates paid on the Company's sources of funding which has outpaced the 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.

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. Under the terms of those interest rate swap agreements, the Company generally received payments based on the outstanding notional amount at fixed rates and made payments at variable rates. 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 Company enters into forward-starting interest rate swap agreements predominantly to hedge interest rate exposures expected in future periods. The following table summarizes information about interest rate swap agreements entered into for interest rate risk management purposes at September 30, 2024 and December 31, 2023.

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INTEREST RATE SWAP AGREEMENTS - DESIGNATED AS HEDGES



	Notional Amount		Weighted-Average Maturity (In years)	Weighted- Average Rate
(Dollars in millions)	Fixed		Variable
September 30, 2024
Fair value hedges:

Fixed rate long-term borrowings — active	$	2,000	5.6	3.11	%	5.14	%
Fixed rate long-term borrowings — forward-starting	1,850		5.2	3.87		4.96
Fixed rate available for sale securities — active	15		0.3	4.84		4.86
Total fair value hedges	3,865		5.4
Cash flow hedges:
Variable rate commercial real estate loans and commercial and industrial loans:
Active	20,155		1.2	3.24		5.04
Forward-starting	6,550		2.7	3.86		4.96
Total cash flow hedges	26,705		1.5
Total	$	30,570	2.0
December 31, 2023
Fair value hedges:
Fixed rate long-term borrowings:
Active	$	2,000	6.4	3.11	%	5.74	%
Forward-starting	1,000		4.8	4.13		5.37
Total fair value hedges	3,000		5.8
Cash flow hedges:
Variable rate commercial real estate loans:
Active	14,977		1.2	3.31		5.35
Forward-starting	9,000		2.5	3.67		5.37
Total cash flow hedges	23,977		1.7
Total	$	26,977	2.2

- 56 -

Information regarding the fair value of interest rate swap agreements is presented in note 11 of Notes to Financial Statements. 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 presented in the table that follows.

INTEREST RATE SWAP AGREEMENTS - EFFECT ON NET INTEREST INCOME


	Three Months Ended
	September 30, 2024				June 30, 2024
(Dollars in millions)	Amount		Rate (a)		Amount		Rate (a)
Increase (decrease) in:
Interest income	$	(102)	-.21	%	$	(99)	-.21	%
Interest expense	13		.04		14		.04
Net interest income/margin	$	(115)	-.24	%	$	(113)	-.23	%
Average notional amount (b)	$	21,558			$	20,589
Rate received (c)			3.21	%			3.21	%
Rate paid (c)			5.30				5.38


	Nine Months Ended September 30,
	2024				2023
(Dollars in millions)	Amount		Rate (a)		Amount		Rate (a)
Increase (decrease) in:
Interest income	$	(288)	-.20	%	$	(173)	-.12	%
Interest expense	40		.04		38		.04
Net interest income/margin	$	(328)	-.23	%	$	(211)	-.15	%
Average notional amount (b)	$	20,454			$	13,089
Rate received (c)			3.25	%			3.05	%
Rate paid (c)			5.35				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 $120 million was recorded in the third quarter of 2024, compared with $150 million in the second quarter of 2024. The lower provision for credit losses in the recent quarter as compared with the second quarter of 2024 reflects a decline in commercial and industrial and commercial real estate criticized loans, partially offset by growth in commercial and industrial and consumer loan portfolios. For the nine months ended September 30, 2024 and 2023, the Company recorded a provision for credit losses of $470 million and $420 million, respectively. The higher provision for credit losses in the first nine months of 2024 as compared with the similar 2023 period reflects declines in commercial real estate values, including office properties, and higher interest rates contributing to a deterioration in the performance of loans to certain commercial borrowers, including nonautomotive dealers and health services facilities, as well as growth in certain sectors of M&T's commercial and industrial and consumer loan portfolios.

- 57 -

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


	Three Months Ended
	September 30, 2024				June 30, 2024
(Dollars in millions)	Net Charge-Offs (Recoveries)		Annualized Percentage of Average Loans		Net Charge-Offs (Recoveries)		Annualized Percentage of Average Loans
Commercial and industrial	$	50	.33	%	$	70	.48	%
Real estate:
Commercial	20		.36		26		.43
Residential builder and developer	—		—		—		—
Other commercial construction	—		—		—		—
Residential	—		—		—		—
Residential - limited documentation	—		—		—		—
Consumer:
Home equity lines and loans	—		—		—		—
Recreational finance	21		.72		16		.59
Automobile	3		.29		2		.25
Other	26		4.69		23		4.41
Total	$	120	.35	%	$	137	.41	%


	Nine Months Ended September 30,
	2024				2023
(Dollars in millions)	Net Charge-Offs (Recoveries)		Annualized Percentage of Average Loans			Net Charge-Offs (Recoveries)		Annualized Percentage of Average Loans
Commercial and industrial	$	193	.44	%		$	37	.09	%
Real estate:
Commercial	54		.30			169		.84
Residential builder and developer	—		—			2		.20
Other commercial construction	11		.24			1		.03
Residential	—		—			—		—
Residential - limited documentation	—		—			—		—
Consumer:
Home equity lines and loans	—		—			—		—
Recreational finance	58		.70			33		.47
Automobile	10		.33			4		.13
Other	69		4.45			47		3.06
Total	$	395	.39	%		$	293	.30	%

- 58 -

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)	September 30, 2024			June 30, 2024			December 31, 2023			September 30, 2023
Nonaccrual loans	$	1,926		$	2,024		$	2,166		$	2,342
Real estate and other foreclosed assets	37			33			39			37
Total nonperforming assets	$	1,963		$	2,057		$	2,205		$	2,379
Accruing loans past due 90 days or more (a)	$	288		$	233		$	339		$	354
Government-guaranteed loans included in totals above:
Nonaccrual loans	$	69		$	64		$	53		$	40
Accruing loans past due 90 days or more (a)	269			215			298			269
Loans 30-89 days past due	1,506			1,387			1,724			1,748

Nonaccrual loans to total net loans and leases	1.42		%	1.50		%	1.62		%	1.77		%
Nonperforming assets to total net loans and leases and real estate and other foreclosed assets	1.44			1.52			1.64			1.80
Accruing loans past due 90 days or more to total net loans and leases	.21			.17			.25			.27
Loans 30-89 days past due to total net loans and leases	1.11			1.03			1.29			1.32

_______________________________________________________________

*(a)*Predominantly government-guaranteed residential real estate loans.

The $98 million decline in nonaccrual loans from June 30, 2024 to September 30, 2024 reflects lower commercial real estate nonaccrual loans of $122 million. As compared with December 31, 2023, the $240 million decline in nonaccrual loans at September 30, 2024 reflects a $379 million reduction in commercial real estate nonaccrual loans, partially offset by a $140 million increase in commercial and industrial nonaccrual loans. At September 30, 2024, approximately 57% of nonaccrual commercial and industrial and commercial real estate loans were considered current with respect to their payment status.

Government-guaranteed loans designated 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 $204 million at September 30, 2024, $170 million at June 30, 2024, $228 million at December 31, 2023 and $202 million at September 30, 2023. 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 72% of loans 30 to 89 days past due were less than 60 days delinquent at September 30, 2024, compared with 74% at June 30, 2024 and 73% at December 31, 2023. Additional information about past due and nonaccrual loans at September 30, 2024 and December 31, 2023 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 modifications that the Company grants are typically comprised of maturity extensions, payment deferrals and interest rate reductions but may also include other modification types. 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.

- 59 -

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 designated as “criticized.” A criticized loan may be designated 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 review 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. 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. Elevated vacancies and higher interest rates have contributed to lower current and anticipated future debt service coverage ratios, which have and may 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, in particular those borrowers with loans secured by office properties, to refinance their obligations at loan maturity. Despite these challenges, the ability of borrowers to service loans secured by certain investor-owned real estate, including health services, retail and multifamily properties has modestly improved in recent quarters. Criticized investor-owned commercial real estate loans totaled $6.7 billion or 23% of such loans at September 30, 2024, improved from $7.6 billion or 26% at June 30, 2024 and $8.8 billion or 27% of such loans at December 31, 2023. Investor-owned commercial real estate loans comprised 62%, 63% and 70% of total criticized loans at September 30, 2024, June 30, 2024 and December 31, 2023, respectively. The weighted-average LTV ratio for investor-owned commercial real estate loans was approximately 56% at each of September 30, 2024, June 30, 2024 and December 31, 2023. Criticized loans secured by investor-owned commercial real estate had a weighted-average LTV ratio of approximately 63%, 62% and 61% at September 30, 2024, June 30, 2024 and December 31, 2023, respectively.

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 148% of Tier 1 capital plus its allowable allowance for credit losses at September 30, 2024, compared with 151% at June 30, 2024 and 183% at December 31, 2023. The Company has intentionally reduced its relative concentration of investor-owned commercial real estate loans throughout 2023 and the first nine months of 2024.

- 60 -

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 September 30, 2024 and December 31, 2023.

CRITICIZED COMMERCIAL AND INDUSTRIAL LOANS


	September 30, 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	$	11,056	$	119	$	15	$	134	$	10,679	$	346	$	3	$	349
Services	7,635		337		119		456		6,715		295		100		395
Motor vehicle and recreational finance dealers	6,652		560		97		657		6,242		164		51		215
Manufacturing	6,231		429		109		538		5,981		549		65		614
Wholesale	4,086		253		28		281		3,803		180		45		225
Transportation, communications, utilities	3,770		282		69		351		3,342		195		71		266
Retail	3,083		75		23		98		2,727		102		35		137
Construction	2,226		154		54		208		2,092		173		62		235
Health services	1,933		209		32		241		1,950		297		28		325
Real estate investors	1,641		150		4		154		1,684		189		4		193
Other	1,730		98		53		151		1,889		123		50		173
Total commercial and industrial excluding owner-occupied real estate	$	50,043	$	2,666	$	603	$	3,269	$	47,104	$	2,613	$	514	$	3,127
Owner-occupied real estate by industry:
Services	$	2,336	$	169	$	43	$	212	$	2,162	$	154	$	51	$	205
Motor vehicle and recreational finance dealers	2,072		42		10		52		1,867		10		7		17
Retail	1,617		66		18		84		1,541		107		13		120
Health services	1,432		259		81		340		656		55		26		81
Wholesale	865		26		4		30		940		28		2		30
Manufacturing	844		49		23		72		842		64		24		88
Real estate investors	773		44		15		59		818		26		12		38
Other	1,030		52		13		65		1,080		32		21		53
Total owner-occupied real estate	10,969		707		207		914		9,906		476		156		632
Total	$	61,012	$	3,373	$	810	$	4,183	$	57,010	$	3,089	$	670	$	3,759

CRITICIZED COMMERCIAL REAL ESTATE LOANS


	September 30, 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	$	6,291	$	884	$	120	$	1,004	$	6,165	$	1,184	$	115	$	1,299
Retail/Service	5,040		734		134		868		5,912		1,075		227		1,302
Office	4,413		1,177		131		1,308		4,727		879		185		1,064
Health services	2,286		734		29		763		3,615		1,364		117		1,481
Hotel	2,133		375		146		521		2,510		496		210		706
Industrial/Warehouse	1,949		143		16		159		2,034		224		13		237
Other	259		57		2		59		314		28		2		30
Total permanent	22,371		4,104		578		4,682		25,277		5,250		869		6,119
Construction/Development	6,312		1,957		86		2,043		7,726		2,527		174		2,701
Total	$	28,683	$	6,061	$	664	$	6,725	$	33,003	$	7,777	$	1,043	$	8,820

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Total criticized commercial and industrial loans and commercial real estate loans were $10.9 billion, $12.1 billion and $12.6 billion at September 30, 2024, June 30, 2024 and December 31, 2023, respectively. Criticized loans represented 12.2% of total commercial and industrial and commercial real estate loans at September 30, 2024, compared with 13.5% at June 30, 2024 and 14.0% at December 31, 2023. At each of September 30, 2024 and June 30, 2024, permanent finance commercial real estate loans comprised 43% of total criticized loans, compared with 49% at December 31, 2023. Commercial and industrial loans represented 38%, 37% and 30% of total criticized loans at September 30, 2024, June 30, 2024 and December 31, 2023, respectively. At September 30, 2024, construction loans represented 19% of total criticized loans, compared with 20% at June 30, 2024 and 21% at December 31, 2023. Loans to nonautomotive finance dealers and loans to borrowers secured by owner-occupied health services properties predominantly contributed to the $424 million increase in commercial and industrial criticized loans from December 31, 2023 to September 30, 2024. The $2.1 billion decline in criticized commercial real estate loans from December 31, 2023 to September 30, 2024 was largely driven by lower criticized construction loans and loans secured by health services, retail and multifamily properties, partially offset by a rise in criticized loans secured by office properties.

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.

- 62 -

NONACCRUAL LOANS SECURED BY RESIDENTIAL REAL ESTATE


	September 30, 2024
			Nonaccrual
(Dollars in millions)	Outstanding Balances		Balances		Percent of Outstanding Balances
Residential mortgage loans:
New York	$	6,554	$	92	1.40	%
Mid-Atlantic (a)	6,742		60		.89
New England (b)	5,977		48		.81
Other	2,923		19		.65
Total	$	22,196	$	219	.99	%
Limited documentation first lien mortgage loans:
New York	$	376	$	27	7.28	%
Mid-Atlantic (a)	335		20		5.98
New England (b)	77		7		9.40
Other	35		3		7.59
Total	$	823	$	57	6.96	%
First lien home equity loans and lines of credit:
New York	$	784	$	15	1.90	%
Mid-Atlantic (a)	922		21		2.31
New England (b)	443		5		1.10
Other	17		3		16.42
Total	$	2,166	$	44	2.02	%
Junior lien home equity loans and lines of credit:
New York	$	806	$	16	1.93	%
Mid-Atlantic (a)	966		17		1.75
New England (b)	607		5		.84
Other	31		—		1.06
Total	$	2,410	$	38	1.57	%

_______________________________________________________________

*(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)	September 30, 2024		December 31, 2023
Home equity lines and loans	$	82	$	81
Recreational finance	28		36
Automobile	11		14
Other	55		52
Total	$	176	$	183

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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.

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 September 30, 2024 concerns existed about the impact of elevated levels of inflation and potential increases in unemployment on the discretionary income and purchasing power of consumer borrowers; slower economic growth in future quarters; the volatile nature of global markets and international economic conditions that could impact the U.S. economy; Federal Reserve positioning of monetary policy, including the effects of liquidity in financial markets; downward pressures on commercial real estate values, especially in the office sector; elevated interest rates and wage pressures impacting commercial borrowers, including nonautomotive finance dealers; and the extent to which borrowers may be negatively affected by general economic conditions.

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 each period end reporting date 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 Review Committee, which is comprised of senior management business leaders and economists. The assumptions utilized as of September 30, 2024, June 30, 2024 and December 31, 2023 are presented in the following table and were based on information available at or near the time the Company was preparing its estimate of expected credit losses as of those dates.

ALLOWANCE FOR CREDIT LOSSES MACROECONOMIC ASSUMPTIONS


	September 30, 2024						June 30, 2024						December 31, 2023
	Year 1		Year 2		Cumulative		Year 1		Year 2		Cumulative		Year 1		Year 2		Cumulative
National unemployment rate	4.7	%	4.8	%			4.5	%	4.7	%			4.4	%	4.7	%
Real GDP growth rate	1.4		1.9		3.4	%	1.2		1.9		3.1	%	.9		1.9		2.8	%
Commercial real estate price index growth/decline rate	.6		5.3		6.2		-4.0		4.6		.7		-9.1		4.8		-4.5
Home price index growth/ decline rate	-.4		2.4		2.0		-.1		2.1		2.0		-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 forecast 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.

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ALLOWANCE FOR CREDIT LOSSES SENSITIVITIES


	September 30, 2024
	Year 1		Year 2		Cumulative
Potential downside economic scenario:
National unemployment rate	7.0	%	8.0	%
Real GDP growth/decline rate	-2.3		1.6		-.7	%
Commercial real estate price index decline rate	-11.4		-2.1		-13.3
Home price index growth/decline rate	-9.2		2.1		-7.3
Potential upside economic scenario:
National unemployment rate	3.4		3.2
Real GDP growth rate	3.7		2.2		6.0
Commercial real estate price index growth rate	6.2		8.9		15.7
Home price index growth rate	4.5		4.3		9.0


(Dollars in millions)	Impact to Modeled Credit Losses Increase (Decrease)
Potential downside economic scenario	$	321
Potential upside economic scenario	(152)

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 September 30, 2024 appropriately reflected expected credit losses inherent in the portfolio as of that date. The allowance for credit losses totaled $2.2 billion at each of September 30, 2024 and June 30, 2024, compared with $2.1 billion at December 31, 2023. As a percentage of loans and leases outstanding, the allowance was 1.62% at September 30, 2024, 1.63% at June 30, 2024 and 1.59% at December 31, 2023. The increase in the allowance for credit losses as a percentage of loans and leases outstanding since December 31, 2023 reflects a higher level of credit losses expected on certain commercial borrowers and growth in consumer recreational finance loans. Included in the allocation of the allowance for credit losses were reserves for loans secured by office properties of 4.70% at September 30, 2024, 4.33% at June 30, 2024 and 4.37% at 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 September 30, 2024, June 30, 2024 and December 31, 2023 was 114%, 109% 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.

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Other Income

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

OTHER INCOME


	Three Months Ended				Change				Nine Months Ended				Change
(Dollars in millions)	September 30, 2024		June 30, 2024		Amount		%		September 30, 2024		September 30, 2023		Amount		%
Mortgage banking revenues	$	109	$	106	$	3	3	%	$	319	$	297	$	22	7	%
Service charges on deposit accounts	132		127		5		3		383		354		29		8
Trust income	170		170		—		—		500		521		(21)		-4
Brokerage services income	32		30		2		2		91		76		15		19
Trading account and other non-hedging derivative gains	13		7		6		109		29		38		(9)		-22
Gain (loss) on bank investment securities	(2)		(8)		6		—		(8)		—		(8)		—
Other revenues from operations	152		152		—		—		456		664		(208)		-31
Total other income	$	606	$	584	$	22	4	%	$	1,770	$	1,950	$	(180)	-9	%

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				Nine Months Ended				Change
(Dollars in millions)	September 30, 2024		June 30, 2024		Amount		%		September 30, 2024		September 30, 2023		Amount		%
Residential mortgage banking revenues
Gains on loans originated for sale	$	9	$	7	$	2	32	%	$	23	$	20	$	3	20	%
Loan servicing fees	37		38		(1)		-2		114		94		20		20
Loan sub-servicing and other fees	29		31		(2)		-8		92		94		(2)		-2
Total loan servicing revenues	66		69		(3)		-5		206		188		18		9
Total residential mortgage banking revenues	$	75	$	76	$	(1)	-1	%	$	229	$	208	$	21	10	%
New commitments to originate loans for sale	$	405	$	399	$	6	1	%	$	1,092	$	1,011	$	81	8	%


(Dollars in millions)	September 30, 2024		June 30, 2024		December 31, 2023		September 30, 2023
Balances at period end
Loans held for sale	$	242	$	209	$	190	$	205
Commitments to originate loans for sale	258		281		163		238
Commitments to sell loans	419		419		295		384
Capitalized mortgage servicing rights	389		409		456		481

Loans serviced for others	38,609		39,034		40,021		40,504
Loans sub-serviced for others (a)	112,695		112,486		115,321		114,599
Total loans serviced for others	$	151,304	$	151,520	$	155,342	$	155,103

_______________________________________________________________

*(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 16 of Notes to Financial Statements.

The increase in residential mortgage loan servicing fees of $20 million in the nine-month period ended September 30, 2024 as compared with the same 2023 period reflects an additional quarter of revenues in 2024 from 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.

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COMMERCIAL MORTGAGE BANKING ACTIVITIES


	Three Months Ended				Change				Nine Months Ended				Change
(Dollars in millions)	September 30, 2024		June 30, 2024		Amount		%		September 30, 2024		September 30, 2023		Amount		%
Commercial mortgage banking revenues
Gains on loans originated for sale	$	15	$	12	$	3	17	%	$	35	$	38	$	(3)	-7	%
Loan servicing fees and other	19		18		1		9		55		51		4		7
Total commercial mortgage banking revenues	$	34	$	30	$	4	12	%	$	90	$	89	$	1	1	%
Loans originated for sale to other investors	$	1,191	$	626	$	565	90	%	$	2,861	$	2,547	$	314	12	%


(Dollars in millions)	September 30, 2024		June 30, 2024		December 31, 2023		September 30, 2023
Balances at period end
Loans held for sale	$	716	$	168	$	189	$	226
Commitments to originate loans for sale	825		682		916		339
Commitments to sell loans	1,521		850		1,105		565
Capitalized mortgage servicing rights	116		120		123		125

Loans serviced for others (a)	25,793		25,541		24,157		23,934
Loans sub-serviced for others	4,044		3,927		3,873		3,749
Total loans serviced for others	$	29,837	$	29,468	$	28,030	$	27,683

_______________________________________________________________

*(a)*Includes loan balances for which investors had recourse to the Company if such balances are ultimately uncollectible of $3.9 billion at each of September 30, 2024 and December 31, 2023 and $4.0 billion at each of June 30, 2024 and September 30, 2023.

Service charges on deposit accounts

Service charges on deposit accounts in the third quarter of 2024 increased $5 million as compared with the second quarter of 2024 reflecting more days in the recent quarter in which transactions were processed. Service charges on deposit accounts for the first nine months of 2024 increased $29 million as compared with the first nine months of 2023 reflecting higher commercial service charges that resulted from pricing changes and increased customer usage of sweep products, and a rise in consumer fees.

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Trust income

Trust income primarily includes revenues 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				Nine Months Ended				Change
(Dollars in millions)	September 30, 2024		June 30, 2024		Amount		%		September 30, 2024		September 30, 2023		Amount		%
Trust income
Institutional Services	$	88	$	87	$	1	2	%	$	256	$	287	$	(31)	-11	%
Wealth Management	81		82		(1)		-3		241		233		8		4
Commercial	1		1		—		-18		3		1		2		86
Total trust income	$	170	$	170	$	—	—	%	$	500	$	521	$	(21)	-4	%


(Dollars in millions)	September 30, 2024		June 30, 2024		December 31, 2023		September 30, 2023
Assets under management at period end
Trust assets under management (excluding proprietary funds)	$	66,739	$	65,274	$	63,963	$	62,769
Proprietary mutual funds	15,092		14,139		14,772		14,836
Total assets under management	$	81,831	$	79,413	$	78,735	$	77,605

Trust income was $170 million in the recent quarter, unchanged from the second quarter of 2024. The modest decrease in Wealth Management revenues reflected seasonal tax service fees earned in the second quarter of 2024, partially offset by higher fees resulting from improved market performance of assets under management.

For the nine months ended September 30, 2024, trust income totaled $500 million, compared with $521 million in the similar 2023 period.

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 $60 million in the first nine months 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 nine months.
Institutional Services trust income not related to the CIT business increased $29 million for the first nine months of 2024 as compared with the similar 2023 period reflecting higher sales and fund management fees from its global capital markets business.
The higher level of trust income in the first nine months of 2024 from the Wealth Management business reflected the impact of higher assets under management and improved market performance associated with those managed assets.

Brokerage services income

Brokerage services income, which includes revenues from the sale of mutual funds and annuities, securities brokerage fees and select investment products of LPL Financial, an independent financial services broker, increased $15 million for the nine months ended September 30, 2024 as compared with the first nine months of 2023 reflecting higher annuities sales.

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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				Nine Months Ended				Change
(Dollars in millions)	September 30, 2024		June 30, 2024		Amount		%		September 30, 2024		September 30, 2023		Amount		%
Letter of credit and other credit-related fees	$	50	$	49	$	1	—	%	$	143	$	133	$	10	7	%
Merchant discount and credit card fees	44		46		(2)		-4		130		130		—		—
Bank owned life insurance revenue (a)	14		17		(3)		-17		47		44		3		8
Equipment operating lease income	13		9		4		33		33		44		(11)		-26
BLG income (b)	—		—		—		—		25		20		5		25
Gain on divestiture of CIT	—		—		—		—		—		225		(225)		-100
Other	31		31		—		—		78		68		10		15
Total other revenues from operations	$	152	$	152	$	—	—	%	$	456	$	664	$	(208)	-31	%

_______________________________________________________________

*(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 16 of Notes to Financial Statements.

Other revenues from operations were unchanged in the third quarter of 2024 as compared with 2024's second quarter. Other revenues from operations in the first nine months of 2024 declined $208 million from the first nine months of 2023 reflecting a $225 million gain on the sale of the CIT business in April 2023 and an $11 million decline in operating lease income reflecting higher gains on sales of leased equipment recognized in the 2023 period. Those unfavorable factors were partially offset by a $10 million increase in letter of credit and other credit-related fees, reflecting higher lines of credit and line usage fees, partially offset by lower loan syndication fees, and a $5 million increase in distributions received from M&T's investment in BLG.

Other Expense

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

OTHER EXPENSE


	Three Months Ended				Change				Nine Months Ended				Change
(Dollars in millions)	September 30, 2024		June 30, 2024		Amount		%		September 30, 2024		September 30, 2023		Amount		%
Salaries and employee benefits	$	775	$	764	$	11	1	%	$	2,372	$	2,273	$	99	4	%
Equipment and net occupancy	125		125		—		—		379		387		(8)		-2
Outside data processing and software	123		124		(1)		-1		367		323		44		14
Professional and other services	88		91		(3)		-4		264		314		(50)		-16
FDIC assessments	25		37		(12)		-32		122		87		35		40
Advertising and marketing	27		27		—		—		74		82		(8)		-10
Amortization of core deposit and other intangible assets	12		13		(1)		—		40		47		(7)		-14
Other costs of operations	128		116		12		10		378		417		(39)		-9
Total other expense	$	1,303	$	1,297	$	6	—	%	$	3,996	$	3,930	$	66	2	%

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Salaries and employee benefits

The number of full time equivalent employees was 21,986 at September 30, 2024, 22,110 at June 30, 2024, 21,980 at December 31, 2023 and 22,424 at September 30, 2023.
Salaries and employee benefits expense increased $11 million in the third quarter as compared with the second quarter of 2024 reflecting one additional working day in the recent quarter.
Salaries and employee benefits expense increased $99 million in the nine months ended September 30, 2024 as compared with the year-earlier period reflecting higher salaries expense from annual merit and other increases and a rise in incentive compensation, partially offset by lower average employee staffing levels.

Nonpersonnel expenses

FDIC assessments in the first nine months of 2024 reflect estimated special assessment expense of $5 million and $29 million in the second and first quarter of 2024, respectively, related to the FDIC's updated loss estimates associated with certain failed banks. No FDIC special assessment expense was recognized in the comparable 2023 periods.
Nonpersonnel expenses aggregated $528 million in the recent quarter, down from $533 million in the second quarter of 2024. A decline in FDIC assessments expense was largely offset by an increase in other costs of operations predominantly due to the Company's obligation under various agreements to share in losses stemming from certain litigation of Visa, Inc.
Nonpersonnel expenses decreased $33 million to $1.62 billion in the nine months ended September 30, 2024 as compared with $1.66 billion in the first nine months of 2023, reflecting a decline in professional and other services expense of $50 million, predominantly from lower sub-advisory fees following the sale of the CIT business in April 2023, and a decrease in losses associated with certain retail banking activities. Those favorable factors were partially offset by a rise in outside data processing and software costs of $44 million and higher FDIC assessments expense as previously described.

Income Taxes

Income tax expense was $188 million in the third quarter of 2024, compared with $200 million in the second quarter of 2024. For the nine-month periods ended September 30, 2024 and 2023, the provision for income taxes was $521 million and $734 million, respectively. The Company's effective tax rates were 20.7% and 23.4% for the quarters ended September 30, 2024 and June 30, 2024, respectively, and 21.5% and 24.5% for the nine-month periods ended September 30, 2024 and 2023, respectively. The income tax expense in the recent quarter reflects a $14 million discrete tax benefit related to certain tax credits claimed on a prior year return. The income tax expense in the first nine months of 2024 reflects that discrete tax benefit and, in the first quarter of 2024, a $17 million net discrete tax benefit related to the resolution of an income 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 the various tax authorities that may examine tax returns filed by M&T or any of its subsidiaries.

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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 $150.2 billion at September 30, 2024 and $146.5 billion at December 31, 2023. The increase in core deposits since December 31, 2023 reflects higher savings and interest-checking deposits, including higher transitory commercial and institutional services deposits near the end of the recent quarter, partially offset by lower noninterest-bearing deposits as customers shifted funds to interest-bearing accounts in an elevated interest rate environment.

The Company supplements funding provided through deposits with various short-term and long-term wholesale borrowings, including overnight federal funds purchased, repurchase agreements, advances from 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 and the FRB of New York. M&T Bank is also a counterparty to the FRB of New York standing repurchase agreement facility, which allows it to enter into overnight repurchase transactions using eligible investment securities. The Company has, in the past, issued subordinated capital notes and junior subordinated debentures associated with trust preferred securities to provide liquidity and enhance regulatory capital ratios. At September 30, 2024 and December 31, 2023, long-term borrowings aggregated $11.6 billion and $8.2 billion, respectively, and short-term borrowings aggregated $2.6 billion and $5.3 billion, respectively. Information about the Company's borrowings is presented in note 5 of Notes to Financial Statements.

The Company's wholesale funding sources include the placement of brokered deposits. The Company had brokered savings and interest-checking deposit accounts which aggregated $9.3 billion at September 30, 2024 and $7.8 billion at December 31, 2023. Reflecting a mix shift in the Company's wholesale funding strategy, brokered time deposits totaled $2.0 billion at September 30, 2024, down $4.1 billion from $6.1 billion at December 31, 2023, as brokered time deposits matured. Approximately 76% of brokered time deposits at September 30, 2024 have a contractual maturity date in the next 12 months.

Total uninsured deposits were estimated to be $74.8 billion at September 30, 2024 and $67.0 billion at December 31, 2023. Approximately $11.2 billion and $10.7 billion of those uninsured deposits were collateralized by the Company at September 30, 2024 and December 31, 2023, respectively. The Company maintains available liquidity sources which represent approximately 134% of uninsured deposits that are not collateralized by the Company at September 30, 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 risks by conducting scenario analyses that estimate the liquidity impact resulting from a debt ratings downgrade 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 September 30, 2024 approximately $2.6 billion was available for payment of dividends to M&T from bank subsidiaries. M&T may also 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

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and financial source of strength to its bank subsidiaries as described in Part I, Item 1, "Business" in M&T's 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 September 30, 2024, M&T's parent company liquidity covered projected cash outflows for 35 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, 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. U.S. Treasury and federal agency securities and government issued or guaranteed mortgage-backed securities comprised 92% of the Company's debt securities portfolio at September 30, 2024. The weighted-average durations of debt investment securities available for sale and held to maturity at September 30, 2024 were 2.3 years and 5.2 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 14 of Notes to Financial Statements.

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. 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 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 at September 30, 2024 and December 31, 2023.

AVAILABLE LIQUIDITY SOURCES


(Dollars in millions)	September 30, 2024		December 31, 2023
Deposits at the FRB of New York	$	24,288	$	27,957
Unused secured borrowing facilities:
FRB of New York	23,814		17,106
FHLB of New York	15,757		16,765
Unencumbered investment securities (after estimated haircuts)	21,603		16,480
Total	$	85,462	$	78,308

Management continuously evaluates the use and mix of its various available funding alternatives, including short-term borrowings, 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

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management can quickly leverage to assist in decision-making and specifies roles and responsibilities for departments impacted by a potential liquidity stress event.

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 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 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. The Company has entered into interest rate swap agreements to help manage exposure to interest rate risk. At September 30, 2024, the aggregate notional amount of interest rate swap agreements entered into for interest rate risk management purposes that were currently in effect was $22.2 billion. In addition, the Company has entered into $8.4 billion of forward-starting interest rate swap agreements designated for hedging purposes. 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 11 of Notes to Financial Statements.

The Company’s Executive ALCO Committee 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 contemplate both parallel (that is, when interest rates at each point of the yield curve change by the same magnitude) and non-parallel (that is, allowing interest rates at points on the yield curve to change by different amounts) shifts in the yield curve. The Company also contemplates instantaneous and gradual shifts in the yield curve over the scenario time horizon. 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. 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 September 30, 2024 and December 31, 2023 displays the estimated impact on net interest income in the base scenario described above resulting from changes in market interest rates. The scenarios presented in the table below assume a gradual and parallel change 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
(Dollars in millions)	September 30, 2024		December 31, 2023
Changes in interest rates
+200 basis points	$	(55)	$	(18)
+100 basis points	(10)		20


-100 basis points	9		(46)
-200 basis points	(6)		(83)

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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. Changes in amounts presented since December 31, 2023 reflect changes in portfolio composition (including purchases of investment securities, shifts between noninterest-bearing and interest-bearing deposit products, lower levels of brokered time deposits and short-term borrowings and higher levels of long-term borrowings), the level of market-implied forward interest rates and hedging actions taken by the Company. M&T's cumulative deposit pricing beta, which is the change in deposit pricing in response to a change in market interest rates, approximated 55 percent amidst a rising interest rate environment from the first quarter of 2022 through the second quarter of 2024. Reflecting the first cut of the federal funds target interest rate since March 2020, the FOMC decreased that rate by 50 basis points on September 18, 2024. 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. Management also uses an “economic value of equity” model to supplement the modeling technique described above and provide a long-term interest rate risk metric. Economic value of equity is a point-in-time analysis of the economic sensitivity of assets, liabilities and 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. Information about the fair valuation of financial instruments is presented in note 13 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 consolidated 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 11 of Notes to Financial Statements. As with any non-government guaranteed financial instrument, the Company is exposed to credit risk associated with counterparties to its 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 $232 million and $584 million, respectively, at September 30, 2024 and $256 million and $898 million, respectively, at December 31, 2023. The fair value asset and liability amounts at September 30, 2024 have been reduced by contractual settlements of $496 million and $51 million, respectively, and at December 31, 2023 have been reduced by contractual settlements of $783 million and $32 million, respectively. The amounts associated with the Company's non-hedging derivative activities at September 30, 2024 and December 31, 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 $102 million at September 30, 2024 and $106 million at December 31, 2023. Included in trading account assets were assets related to deferred compensation plans of $22 million at each of September 30, 2024 and December 31, 2023. Changes in the fair values of such assets are recorded as trading account and other non-hedging derivative gains in the Consolidated Statement of Income. Included in accrued interest and other liabilities in the Consolidated Balance Sheet were $27 million of liabilities related to deferred compensation plans at each of September 30, 2024 and December 31, 2023. Changes in the balances of such liabilities due to the valuation of allocated investment options to which the liabilities are indexed are recognized in other costs of operations in the Consolidated Statement of Income. Also included in trading account assets were investments in mutual funds and

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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 $80 million at each of September 30, 2024 and December 31, 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 at September 30, 2024, however, as previously noted, the Company is exposed to credit risk associated with counterparties to transactions related to the Company’s actions to mitigate foreign currency and interest rate risk associated with customer activities. Information about the Company’s use of derivative financial instruments is included in note 11 of Notes to Financial Statements.

Capital

The following table presents components related to shareholders' equity and 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 2.

SHAREHOLDERS' EQUITY, DIVIDENDS AND SELECT RATIOS


(Dollars in millions, except per share)	September 30, 2024			December 31, 2023			September 30, 2023
Preferred stock	$	2,394		$	2,011		$	2,011
Common shareholders' equity	26,482			24,946			24,186
Total shareholders' equity	$	28,876		$	26,957		$	26,197
Per share:
Common shareholders’ equity	$	159.38		$	150.15		$	145.72
Tangible common shareholders’ equity	107.97			98.54			93.99
Ratios:
Shareholders' equity to total assets	13.63		%	12.94		%	12.53		%
Tangible common shareholders' equity to tangible assets	8.83			8.20			7.78
Cash dividends declared for quarter ended:
Common stock (a)	$	226		$	217		$	218
Common stock per share	1.35			1.30			1.30
Preferred stock (a)	47			25			25

_______________________________________________________________

*(a)*Common stock dividends were $673 million and $654 million and preferred stock dividends were $99 million and $75 million for the nine months ended September 30, 2024 and 2023, respectively.

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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, gains or losses associated with interest rate swap agreements designated as cash flow hedges and adjustments to reflect the funded status of defined benefit pension and other postretirement plans. The components of accumulated other comprehensive income (loss) are presented in the following table.

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


(Dollars in millions, except per share)	September 30, 2024		December 31, 2023		September 30, 2023
Investment securities unrealized gains (losses), net (a)	$	51	$	(187)	$	(331)
Cash flow hedges unrealized gains (losses), net (b)	45		(151)		(394)
Defined benefit plans adjustments, net (c)	(119)		(115)		(207)
Other, net	(4)		(6)		(10)
Total	$	(27)	$	(459)	$	(942)

Accumulated other comprehensive income (loss), net, per common share	$	(0.16)	$	(2.76)	$	(5.67)

_______________________________________________________________

*(a)*Refer to note 3 of Notes to Financial Statements.

*(b)*Refer to note 11 of Notes to Financial Statements.

*(c)*Refer to note 8 of Notes to Financial Statements.

Reflected in the carrying amount of available-for-sale investment securities at September 30, 2024 were pre-tax effect unrealized gains of $177 million on securities with an amortized cost of $10.8 billion and pre-tax effect unrealized losses of $108 million on securities with an amortized cost of $5.9 billion. Information concerning the Company’s fair valuations of investment securities is provided in notes 3 and 13 of Notes to Financial Statements. As also described in note 3 of Notes to Financial Statements, the Company does not expect any material credit-related losses with respect to its investment securities portfolio at September 30, 2024.

Pursuant to previously approved capital plans and authorizations approved by M&T's Board of Directors, M&T repurchased 1,190,054 shares of its common stock during the recent quarter at an average cost per share of $166.40 resulting in a total cost, including the share repurchase excise tax, of $200 million. No share repurchases occurred in the first or second quarter of 2024. During the first nine months of 2023, M&T repurchased 3,838,157 shares of its common stock at an average cost per share of $154.76 resulting in a total cost, including the share repurchase excise tax, of $600 million. 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.

M&T and its subsidiary banks are required to comply with applicable Capital Rules. Pursuant to those regulations, the minimum capital ratios are as follows:

4.5% CET1 to RWA (each as defined in the Capital Rules);
6.0% Tier 1 capital (that is, CET1 plus additional Tier 1 capital) to RWA (each as defined in the Capital Rules);
8.0% Total capital (that is, Tier 1 capital plus Tier 2 capital) to RWA (each as defined in the 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 Rules.

Capital Rules require buffers in addition to the minimum risk-based capital ratios noted above. M&T is subject to a 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 SCB at September 30, 2024 was 4.0%. In June 2024, the Federal Reserve released the results of its most recent supervisory stress tests. Based on those results, on October 1, 2024, M&T's SCB of 3.8% became effective.

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

REGULATORY CAPITAL RATIOS


(Dollars in millions)	M&T (Consolidated)			M&T Bank			Wilmington Trust, N.A.
CET1	11.54		%	12.54		%	275.18		%
Tier 1 capital	13.08			12.54			275.18
Total capital	14.65			13.92			275.53
Tier 1 leverage	10.14			9.72			86.02
RWA	$	155,981		$	155,554		$	226

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 $107 million at September 30, 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 September 30, 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 September 30, 2024 covered projected cash outflows for 35 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 M&T's 2023 Annual Report.

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 Deposit Insurance Fund 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 insured depositors. 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 on 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 2023 Annual Report.

As described in Part I, Item 1 of M&T's 2023 Annual Report, the federal banking agencies issued a notice of proposed rulemaking on July 27, 2023 to modify the regulatory capital requirements applicable to large banking organizations with total assets exceeding $100 billion, like the Company. Management continues to evaluate the impact of the proposed rules on the regulatory capital requirements of M&T and its subsidiary banks. At September 30, 2024, the inclusion of accumulated other comprehensive income (loss) components related to investment securities available for sale and defined benefit plan liability adjustments would have reduced the Company's CET1 ratio by 4 basis points.

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Segment Information

Reportable segments have been determined based upon the Company's organizational structure and its internal profitability reporting system. Financial information about the Company's segments is presented in note 15 of Notes to Financial Statements. The reportable segments are Commercial Bank, Retail Bank, and 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				Nine Months Ended				Change
(Dollars in millions)	September 30, 2024		June 30, 2024		Amount		%		September 30, 2024		September 30, 2023		Amount		%
Net income (loss)
Commercial Bank	$	239	$	205	$	34	16	%	$	645	$	819	$	(174)	-21	%
Retail Bank	446		472		(26)		-5		1,364		1,400		(36)		-3
Institutional Services and Wealth Management	137		144		(7)		-5		409		515		(106)		-21
All Other	(101)		(166)		65		39		(511)		(475)		(36)		-8
Total net income	$	721	$	655	$	66	10	%	$	1,907	$	2,259	$	(352)	-16	%

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 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.

COMMERCIAL BANK SEGMENT FINANCIAL SUMMARY


	Three Months Ended				Change				Nine Months Ended				Change
(Dollars in millions)	September 30, 2024		June 30, 2024		Amount		%		September 30, 2024		September 30, 2023		Amount		%
Income Statement
Net interest income	$	551	$	553	$	(2)	—	%	$	1,652	$	1,826	$	(174)	-9	%
Noninterest income	172		164		8		5		487		482		5		1
Total revenue	723		717		6		1		2,139		2,308		(169)		-7
Provision for credit losses	39		77		(38)		-50		193		184		9		5
Noninterest expense	358		359		(1)		—		1,062		1,002		60		6
Income before taxes	326		281		45		16		884		1,122		(238)		-21
Income taxes	87		76		11		15		239		303		(64)		-21
Net income	$	239	$	205	$	34	16	%	$	645	$	819	$	(174)	-21	%
Average Balance Sheet
Loans and leases:
Commercial and industrial	$	51,920	$	50,341	$	1,579	3	%	$	50,442	$	46,125	$	4,317	9	%
Commercial real estate	27,226		29,561		(2,335)		-8		29,170		32,868		(3,698)		-11
Residential real estate	428		437		(9)		-2		437		398		39		10
Consumer	21		29		(8)		-29		25		25		—		—
Total loans and leases, net	$	79,595	$	80,368	$	(773)	-1	%	$	80,074	$	79,416	$	658	1	%
Deposits:
Noninterest-bearing	$	11,970	$	12,523	$	(553)	-4	%	$	12,648	$	18,065	$	(5,417)	-30	%
Interest-bearing	32,204		30,429		1,775		6		30,907		23,939		6,968		29
Total deposits	$	44,174	$	42,952	$	1,222	3	%	$	43,555	$	42,004	$	1,551	4	%

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The Commercial Bank segment’s net income was $239 million in the third quarter of 2024, up from $205 million in the second quarter of 2024.

Noninterest income increased $8 million reflecting higher commercial mortgage banking revenues.
Provision for credit losses decreased $38 million reflecting lower net charge-offs of commercial and industrial loans and commercial real estate loans.
Average loans and leases declined $773 million reflecting a $2.3 billion reduction in average commercial real estate loans, partially offset by a $1.6 billion increase in average commercial and industrial loans. The growth in average commercial and industrial loans spanned most industry types.
Average deposits increased $1.2 billion reflecting higher average savings and interest-checking deposits of $1.9 billion, partially offset by a $553 million decline in noninterest-bearing deposits.

Net income for the Commercial Bank segment was $645 million in the first nine months of 2024, compared with $819 million in the first nine months of 2023.

Net interest income declined $174 million reflecting a narrowing of the net interest margin on deposits and loans of 34 basis points and 17 basis points, respectively, partially offset by a rise in average outstanding deposit and loan balances of $1.6 billion and $658 million, respectively.
Provision for credit losses increased $9 million reflecting higher net charge-offs of commercial and industrial loans, partially offset by lower net charge-offs of loans secured by commercial real estate.
Noninterest expense increased $60 million reflecting a rise in centrally-allocated costs associated with data processing, risk management and other support services provided to the Commercial Bank segment of $46 million and an increase in personnel-related costs of $17 million.
The increase in average loans as compared with the first nine months of 2023 reflects higher average balances of commercial and industrial loans including growth in loans to financial and insurance industry customers and motor-vehicle and recreational finance dealers, partially offset by a reduction in average permanent commercial real estate and average construction loans.
Average deposits grew $1.6 billion compared with the first nine months of 2023 and reflected a shift in customer funds from noninterest-bearing accounts to interest-bearing products amidst an elevated interest rate environment.

Retail Bank

The Retail Bank segment 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 Small Business Administration, business credit cards, deposit products and services such as cash management, payroll and direct deposit, merchant credit card and letters of credit to small businesses and professionals through the Company's branch network and other delivery channels.

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RETAIL BANK SEGMENT FINANCIAL SUMMARY


	Three Months Ended				Change				Nine Months Ended				Change
(Dollars in millions)	September 30, 2024		June 30, 2024		Amount		%		September 30, 2024		September 30, 2023		Amount		%
Income Statement
Net interest income	$	1,087	$	1,090	$	(3)	—	%	$	3,248	$	3,269	$	(21)	-1	%
Noninterest income	205		204		1		1		606		568		38		7
Total revenue	1,292		1,294		(2)		—		3,854		3,837		17		—
Provision for credit losses	74		60		14		23		202		117		85		74
Noninterest expense	617		599		18		3		1,815		1,829		(14)		-1
Income before taxes	601		635		(34)		-5		1,837		1,891		(54)		-3
Income taxes	155		163		(8)		-5		473		491		(18)		-4
Net income	$	446	$	472	$	(26)	-5	%	$	1,364	$	1,400	$	(36)	-3	%
Average Balance Sheet
Loans and leases:
Commercial and industrial	$	6,979	$	6,955	$	24	—	%	$	6,936	$	6,784	$	152	2	%
Commercial real estate	1,815		1,859		(44)		-2		1,859		1,899		(40)		-2
Residential real estate	20,400		20,628		(228)		-1		20,623		21,567		(944)		-4
Consumer	22,117		21,201		916		4		21,238		19,473		1,765		9
Total loans and leases, net	$	51,311	$	50,643	$	668	1	%	$	50,656	$	49,723	$	933	2	%
Deposits:
Noninterest-bearing	$	24,638	$	25,150	$	(512)	-2	%	$	25,055	$	29,047	$	(3,992)	-14	%
Interest-bearing	66,275		67,156		(881)		-1		66,565		62,266		4,299		7
Total deposits	$	90,913	$	92,306	$	(1,393)	-2	%	$	91,620	$	91,313	$	307	—	%

The Retail Bank segment’s net income was $446 million in the third quarter of 2024, compared with $472 million in the second quarter of 2024.

Net interest income decreased $3 million reflecting a 7 basis-point narrowing of the net interest margin on deposits and a decrease in average outstanding deposit balances of $1.4 billion, partially offset by a 3 basis-point expansion of the net interest margin on loans and higher average loan balances.
Provision for credit losses increased $14 million reflecting higher net charge-offs.
Noninterest expense increased $18 million reflecting a rise in equipment and net occupancy costs of $8 million and higher personnel-related costs of $4 million. Also contributing to the higher expense was an increase in centrally-allocated costs associated with data processing, risk management, and other support services provided to the Retail Bank segment of $3 million.
Average loans increased $668 million reflecting growth in the segment's portfolio of recreational finance loans and automobile loans, partially offset by lower average residential real estate loans.
Lower average deposits in the recent quarter as compared with the second quarter of 2024 reflect time deposit account maturities in the recent quarter and lower noninterest-bearing deposits.

Net income for the Retail Bank segment decreased $36 million in the first nine months of 2024 from $1.40 billion in the similar 2023 period.

Net interest income decreased $21 million reflecting a 2 basis-point narrowing of the net interest margin on each of loans and deposits.
Provision for credit losses increased $85 million reflecting higher net charge-offs of consumer and business banking loans and loan growth, including recreational vehicle loans and automobile loans.
Noninterest income increased $38 million primarily due to higher residential mortgage loan servicing revenues, reflecting the bulk purchase of residential mortgage loan servicing rights at the end of the first quarter of 2023, and a rise in service charges on deposit accounts.

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Noninterest expense decreased $14 million predominantly due to lower other cost of operations of $39 million, reflecting lower losses on certain retail banking activities, and a decline in personnel-related costs of $14 million reflecting lower staffing levels, partially offset by higher centrally-allocated costs associated with data processing, risk management, and other support services provided to the Retail Bank segment of $40 million.
Average loans in the first nine months of 2024 grew $933 million from the similar 2023 period, reflecting higher average consumer loans resulting from an increase in average recreational finance and automobile loans, partially offset by lower average balances of residential real estate loans.
Average deposits in the nine months ended September 30, 2024 as compared with the nine months ended September 30, 2023 reflect a shift from noninterest-bearing accounts to interest-bearing products amidst an elevated interest rate environment.

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				Nine Months Ended				Change
(Dollars in millions)	September 30, 2024		June 30, 2024		Amount		%		September 30, 2024		September 30, 2023		Amount		%
Income Statement
Net interest income	$	185	$	194	$	(9)	-5	%	$	565	$	524	$	41	8	%
Noninterest income	204		207		(3)		-1		602		820		(218)		-27
Total revenue	389		401		(12)		-3		1,167		1,344		(177)		-13
Provision for credit losses	3		3		—		9		6		—		6		100
Noninterest expense	202		203		(1)		-1		610		648		(38)		-6
Income before taxes	184		195		(11)		-5		551		696		(145)		-21
Income taxes	47		51		(4)		-6		142		181		(39)		-22
Net income	$	137	$	144	$	(7)	-5	%	$	409	$	515	$	(106)	-21	%
Average Balance Sheet
Loans and leases:
Commercial and industrial	$	709	$	727	$	(18)	-2	%	$	739	$	795	$	(56)	-7	%
Commercial real estate	34		38		(4)		-8		40		56		(16)		-29
Residential real estate	2,166		1,941		225		12		1,985		1,742		243		14
Consumer	749		731		18		3		734		817		(83)		-10
Total loans and leases, net	$	3,658	$	3,437	$	221	6	%	$	3,498	$	3,410	$	88	3	%
Deposits:
Noninterest-bearing	$	8,864	$	9,340	$	(476)	-5	%	$	9,094	$	9,476	$	(382)	-4	%
Interest-bearing	8,315		7,938		377		5		7,809		7,264		545		7
Total deposits	$	17,179	$	17,278	$	(99)	-1	%	$	16,903	$	16,740	$	163	1	%

The Institutional Services and Wealth Management segment’s net income decreased $7 million to $137 million in the third quarter of 2024 from $144 million in the second quarter of 2024.

Net interest income declined $9 million predominantly due to a 21 basis-point narrowing of the net interest margin on deposits.

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Net income for the Institutional Services and Wealth Management segment decreased $106 million for the nine months ended September 30, 2024 from $515 million in the comparable 2023 period.

Net interest income increased $41 million reflecting a widening of the net interest margin on deposits of 25 basis points.
Noninterest income decreased $218 million predominantly due to the $225 million gain on sale of the CIT business in the second quarter of 2023 and a decline in trust income of $23 million. The lower trust income reflects lower revenues associated with the CIT business of $60 million following its sale, partially offset by higher non-CIT related revenues of $37 million reflecting improved sales in the segment's global capital markets business and a rise in fee income from the wealth management business reflecting higher assets under management and favorable market performance. Those unfavorable factors were partially offset by higher brokerage services income of $14 million, reflecting increased annuities sales.
Noninterest expense decreased $38 million reflecting a $53 million decline in professional and other services expense due, in part, to lower sub-advisory fees as a result of the sale of the CIT business, partially offset by an increase in personnel-related costs of $8 million.

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 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; merger-related gains and expenses related to acquisitions; the net impact of the Company’s internal funds transfer pricing methodology; eliminations of transactions between reportable segments; certain non-recurring transactions; and 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. The results of such activities are captured in the "All Other" category.

ALL OTHER CATEGORY FINANCIAL SUMMARY


	Three Months Ended				Change				Nine Months Ended				Change
(Dollars in millions)	September 30, 2024		June 30, 2024		Amount		%		September 30, 2024		September 30, 2023		Amount		%
Income Statement
Net interest income (expense)	$	(97)	$	(119)	$	22	18	%	$	(341)	$	(226)	$	(115)	-51	%
Noninterest income	25		9		16		165		75		80		(5)		-7
Total revenue (expense)	(72)		(110)		38		34		(266)		(146)		(120)		-83
Provision for credit losses	4		10		(6)		-59		69		119		(50)		-42
Noninterest expense	126		136		(10)		-7		509		451		58		13
Loss before taxes	(202)		(256)		54		21		(844)		(716)		(128)		-18
Income taxes	(101)		(90)		(11)		-13		(333)		(241)		(92)		-38
Net loss	$	(101)	$	(166)	$	65	39	%	$	(511)	$	(475)	$	(36)	-8	%

The “All Other” category recorded a net loss in the third quarter of 2024 of $101 million, compared with a net loss of $166 million in the second quarter of 2024.

Net interest expense declined $22 million due to the favorable impact from the Company’s allocation methodologies for internal transfers related to funding charges and credits associated with earning assets and interest-bearing liabilities of the Company’s reportable segments.
Noninterest income increased $16 million primarily reflecting realized losses on sales of certain non-agency investment securities in the second quarter of 2024 and a rise in trading account and non-hedging derivative gains.

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Provision for credit losses decreased $6 million reflecting the net impact of the allocation of provision for credit losses to reportable segments.
Noninterest expense decreased $10 million reflecting $5 million of FDIC special assessment expense recognized in the second quarter of 2024.

The net loss recorded for the “All Other” category was $511 million for the first nine months of 2024, compared with a net loss of $475 million in the similar 2023 period.

Net interest expense increased $115 million reflecting the impact of interest rate swap agreements entered into for interest rate risk management purposes and the unfavorable impact from the Company’s allocation methodologies for internal transfers related to funding charges and credits associated with earning assets and interest-bearing liabilities of the Company’s reportable segments.
Noninterest income decreased $5 million reflecting realized losses on sales of certain non-agency investment securities in the 2024 period, partially offset by an increase in BLG distributions of $5 million.
Provision for credit losses decreased $50 million reflecting the net impact of the allocation of the provision for credit losses to reportable segments.
Noninterest expense increased $58 million reflecting FDIC special assessment expense of $34 million recorded in the 2024 period and higher personnel-related costs.

Other Matters

On March 6, 2024, the SEC adopted a final rule to enhance and standardize climate-related disclosures by public companies. The final rule requires registrants, including the Company, to disclose their risk management processes for material climate-related risks, governance and oversight of material climate-risks and any risks that have materially impacted, or are reasonably likely to have a material impact on, its business strategy, results of operations or financial 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.

Recent Accounting Developments

A discussion of the Company's significant accounting policies and critical accounting estimates can be found in M&T's 2023 Annual Report. A summary of recent accounting developments is included in note 1 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. 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.

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, 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

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future performance and involve certain risks, uncertainties and assumptions which are difficult to predict and may cause actual outcomes to differ materially from what is expressed or forecasted.

While there can be no assurance that any list of 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 following, without limitation: economic conditions and growth rates, including inflation and market volatility; events and developments in the financial services industry, including industry 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, 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; governmental and public 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 by the Financial Accounting Standards Board, regulatory agencies or legislation; increasing price, product and service competition by competitors, including new entrants; 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; 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.

These are representative of the 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 the Company does business, and other factors.

The Company provides further detail regarding these risks and uncertainties in its 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 the Company assumes no duty and does not undertake to update forward-looking statements.

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M&T BANK CORPORATION AND SUBSIDIARIES

Table 1

QUARTERLY TRENDS


	2024 Quarters									2023 Quarters
(Dollars in millions, except per share, shares in thousands)	Third			Second			First			Fourth			Third			Second			First
Earnings and dividends
Interest income (taxable-equivalent basis)	$	2,798		$	2,802		$	2,757		$	2,753		$	2,656		$	2,530		$	2,341
Interest expense	1,059			1,071			1,065			1,018			866			717			509
Net interest income	1,739			1,731			1,692			1,735			1,790			1,813			1,832
Less: provision for credit losses	120			150			200			225			150			150			120
Other income	606			584			580			578			560			803			587
Less: other expense	1,303			1,297			1,396			1,450			1,278			1,293			1,359
Income before income taxes	922			868			676			638			922			1,173			940
Applicable income taxes	188			200			133			143			217			292			224
Taxable-equivalent adjustment	13			13			12			13			15			14			14
Net income	$	721		$	655		$	531		$	482		$	690		$	867		$	702
Net income available to common shareholders-diluted	$	674		$	626		$	505		$	457		$	664		$	841		$	676
Per common share data:
Basic earnings	4.04			3.75			3.04			2.75			4.00			5.07			4.03
Diluted earnings	4.02			3.73			3.02			2.74			3.98			5.05			4.01
Cash dividends	1.35			1.35			1.30			1.30			1.30			1.30			1.30
Average common shares outstanding:
Basic	166,671			166,951			166,460			165,985			165,909			165,842			167,732
Diluted	167,567			167,659			167,084			166,731			166,570			166,320			168,410
Performance ratios
Annualized return on:
Average assets	1.37		%	1.24		%	1.01		%	.92		%	1.33		%	1.70		%	1.40		%
Average common shareholders’ equity	10.26			9.95			8.14			7.41			10.99			14.27			11.74
Net interest margin on average earning assets (taxable-equivalent basis)	3.62			3.59			3.52			3.61			3.79			3.91			4.04
Nonaccrual loans to total loans and leases, net of unearned discount	1.42			1.50			1.71			1.62			1.77			1.83			1.92
Net operating (tangible) results (a)
Net operating income	$	731		$	665		$	543		$	494		$	702		$	879		$	715
Diluted net operating income per common share	4.08			3.79			3.09			2.81			4.05			5.12			4.09
Annualized return on:
Average tangible assets	1.45		%	1.31		%	1.08		%	.98		%	1.41		%	1.80		%	1.49		%
Average tangible common shareholders’ equity	15.47			15.27			12.67			11.70			17.41			22.73			19.00
Efficiency ratio (b)	55.0			55.3			60.8			62.1			53.7			48.9			55.5
Balance sheet data
Average balances:
Total assets (c)	$	209,581		$	211,981		$	211,478		$	208,752		$	205,791		$	204,376		$	202,599
Total tangible assets (c)	201,031			203,420			202,906			200,172			197,199			195,764			193,957
Earning assets	191,366			193,676			193,135			190,536			187,403			185,936			184,069
Investment securities	31,023			29,695			28,587			27,490			27,993			28,623			27,622
Loans and leases, net of unearned discount	134,751			134,588			133,796			132,770			132,617			133,545			132,012
Deposits	161,505			163,491			164,065			164,713			162,688			159,399			161,537
Borrowings	15,428			16,452			16,001			13,057			12,585			15,055			11,505
Common shareholders’ equity (c)	26,160			25,340			25,008			24,489			24,009			23,674			23,366
Tangible common shareholders’ equity (c)	17,610			16,779			16,436			15,909			15,417			15,062			14,724
At end of quarter:
Total assets (c)	211,785			208,855			215,137			208,264			209,124			207,672			202,956
Total tangible assets (c)	203,243			200,302			206,574			199,689			200,538			199,074			194,321
Earning assets	192,766			189,787			195,712			189,140			189,942			188,504			183,853
Investment securities	32,327			29,894			28,496			26,897			27,336			27,916			28,443
Loans and leases, net of unearned discount	135,920			135,002			134,973			134,068			132,355			133,344			132,938
Deposits	164,554			159,910			167,196			163,274			164,128			162,058			159,075
Borrowings	14,188			16,083			16,245			13,517			13,854			15,325			14,458
Common shareholders’ equity (c)	26,482			25,680			25,158			24,946			24,186			23,790			23,366
Tangible common shareholders’ equity (c)	17,940			17,127			16,595			16,371			15,600			15,192			14,731
Equity per common share	159.38			153.57			150.90			150.15			145.72			143.41			140.88
Tangible equity per common share	107.97			102.42			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


	2024 Quarters									2023 Quarters
(Dollars in millions, except per share)	Third			Second			First			Fourth			Third			Second			First
Income statement data
Net income
Net income	$	721		$	655		$	531		$	482		$	690		$	867		$	702
Amortization of core deposit and other intangible assets (a)	10			10			12			12			12			12			13

Net operating income	$	731		$	665		$	543		$	494		$	702		$	879		$	715
Earnings per common share
Diluted earnings per common share	$	4.02		$	3.73		$	3.02		$	2.74		$	3.98		$	5.05		$	4.01
Amortization of core deposit and other intangible assets (a)	.06			.06			.07			.07			.07			.07			.08

Diluted net operating earnings per common share	$	4.08		$	3.79		$	3.09		$	2.81		$	4.05		$	5.12		$	4.09
Other expense
Other expense	$	1,303		$	1,297		$	1,396		$	1,450		$	1,278		$	1,293		$	1,359
Amortization of core deposit and other intangible assets	(12)			(13)			(15)			(15)			(15)			(15)			(17)

Noninterest operating expense	$	1,291		$	1,284		$	1,381		$	1,435		$	1,263		$	1,278		$	1,342










Efficiency ratio
Noninterest operating expense (numerator)	$	1,291		$	1,284		$	1,381		$	1,435		$	1,263		$	1,278		$	1,342
Taxable-equivalent net interest income	$	1,739		$	1,731		$	1,692		$	1,735		$	1,790		$	1,813		$	1,832
Other income	606			584			580			578			560			803			587
Less: Gain (loss) on bank investment securities	(2)			(8)			2			4			—			1			—
Denominator	$	2,347		$	2,323		$	2,270		$	2,309		$	2,350		$	2,615		$	2,419
Efficiency ratio	55.0		%	55.3		%	60.8		%	62.1		%	53.7		%	48.9		%	55.5		%
Balance sheet data
Average assets
Average assets	$	209,581		$	211,981		$	211,478		$	208,752		$	205,791		$	204,376		$	202,599
Goodwill	(8,465)			(8,465)			(8,465)			(8,465)			(8,465)			(8,473)			(8,490)
Core deposit and other intangible assets	(113)			(126)			(140)			(154)			(170)			(185)			(201)
Deferred taxes	28			30			33			39			43			46			49
Average tangible assets	$	201,031		$	203,420		$	202,906		$	200,172		$	197,199		$	195,764		$	193,957
Average common equity
Average total equity	$	28,725		$	27,745		$	27,019		$	26,500		$	26,020		$	25,685		$	25,377
Preferred stock	(2,565)			(2,405)			(2,011)			(2,011)			(2,011)			(2,011)			(2,011)
Average common equity	26,160			25,340			25,008			24,489			24,009			23,674			23,366
Goodwill	(8,465)			(8,465)			(8,465)			(8,465)			(8,465)			(8,473)			(8,490)
Core deposit and other intangible assets	(113)			(126)			(140)			(154)			(170)			(185)			(201)
Deferred taxes	28			30			33			39			43			46			49
Average tangible common equity	$	17,610		$	16,779		$	16,436		$	15,909		$	15,417		$	15,062		$	14,724
At end of quarter
Total assets
Total assets	$	211,785		$	208,855		$	215,137		$	208,264		$	209,124		$	207,672		$	202,956
Goodwill	(8,465)			(8,465)			(8,465)			(8,465)			(8,465)			(8,465)			(8,490)
Core deposit and other intangible assets	(107)			(119)			(132)			(147)			(162)			(177)			(192)
Deferred taxes	30			31			34			37			41			44			47
Total tangible assets	$	203,243		$	200,302		$	206,574		$	199,689		$	200,538		$	199,074		$	194,321
Total common equity
Total equity	$	28,876		$	28,424		$	27,169		$	26,957		$	26,197		$	25,801		$	25,377
Preferred stock	(2,394)			(2,744)			(2,011)			(2,011)			(2,011)			(2,011)			(2,011)
Common equity	26,482			25,680			25,158			24,946			24,186			23,790			23,366
Goodwill	(8,465)			(8,465)			(8,465)			(8,465)			(8,465)			(8,465)			(8,490)
Core deposit and other intangible assets	(107)			(119)			(132)			(147)			(162)			(177)			(192)
Deferred taxes	30			31			34			37			41			44			47
Total tangible common equity	$	17,940		$	17,127		$	16,595		$	16,371		$	15,600		$	15,192		$	14,731

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*(a)*After any related tax effect.

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