M&T BANK CORP - 10-Q Quarterly Report

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

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

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

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act). Yes x No ___

Number of shares of the registrant’s Common Stock, $.50 par value, outstanding as of the close of business on October 31, 2003: 120,031,944 shares.


Table of Contents of Information Required in Report			Page

Part I. FINANCIAL INFORMATION
	Item 1. Financial Statements
		CONSOLIDATED BALANCE SHEET - September 30, 2003 and December 31, 2002		3
		CONSOLIDATED STATEMENT OF INCOME - Three and nine months ended September 30, 2003 and 2002		4
		CONSOLIDATED STATEMENT OF CASH FLOWS - Nine months ended September 30, 2003 and 2002		5
		CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY — Nine months ended September 30, 2003 and 2002		6
		CONSOLIDATED SUMMARY OF CHANGES IN ALLOWANCE FOR CREDIT LOSSES — Nine months ended September 30, 2003 and 2002		6
		NOTES TO FINANCIAL STATEMENTS		7
	Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			22
	Item 3. Quantitative and Qualitative Disclosures About Market Risk			50
	Item 4. Controls and Procedures			50
Part II. OTHER INFORMATION				50
	Item 1. Legal Proceedings			50
	Item 2. Changes in Securities and Use of Proceeds			50
	Item 3. Defaults Upon Senior Securities			50
	Item 4. Submission of Matters to a Vote of Security Holders			50
	Item 5. Other Information			50
	Item 6. Exhibits and Reports on Form 8-K			51
SIGNATURES				52
EXHIBIT INDEX				53


				September 30,			December 31,
Dollars in thousands, except per share				2003			2002

Assets	Cash and due from banks			$	2,242,825			963,772
	Money-market assets
		Interest-bearing deposits at banks			14,616			7,856
		Federal funds sold and agreements to resell securities			38,145			320,359
		Trading account			253,799			51,628

			Total money-market assets		306,560			379,843

	Investment securities
		Available for sale (cost: $5,459,052 at September 30, 2003; $3,508,300 at December 31, 2002)			5,525,909			3,599,135
		Held to maturity (market value: $110,090 at September 30, 2003; $87,893 at December 31, 2002)			107,014			86,397
		Other (market value: $324,483 at September 30, 2003; $269,618 at December 31, 2002)			324,483			269,618

			Total investment securities		5,957,406			3,955,150

	Loans and leases				37,438,815			25,936,942
		Unearned discount			(279,236	)		(209,158	)
		Allowance for credit losses			(621,417	)		(436,472	)

			Loans and leases, net		36,538,162			25,291,312

	Premises and equipment				407,929			238,986
	Goodwill				2,904,081			1,097,553
	Core deposit and other intangible assets				261,548			118,790
	Accrued interest and other assets				1,640,328			1,155,775

			Total assets	$	50,258,839			33,201,181

Liabilities	Noninterest-bearing deposits			$	8,120,990			4,072,085
	NOW accounts				1,568,902			1,029,060
	Savings deposits				13,970,918			9,156,678
	Time deposits				6,423,474			6,246,384
	Deposits at foreign offices				2,330,071			1,160,716

			Total deposits		32,414,355			21,664,923

	Federal funds purchased and agreements to repurchase securities				4,301,977			2,067,834
	Other short-term borrowings				601,272			1,361,580
	Accrued interest and other liabilities				1,169,951			400,991
	Long-term borrowings				6,199,392			4,497,374

			Total liabilities		44,686,947			29,992,702

Stockholders’ equity	Preferred stock, $1 par, 1,000,000 shares authorized, none outstanding				—			—
	Common stock, $.50 par, 250,000,000 shares authorized, 119,733,115 shares issued at September 30, 2003; 97,139,347 shares issued at December 31, 2002				59,867			48,570
	Common stock issuable, 124,239 shares at September 30, 2003; 126,670 shares at December 31, 2002				6,306			6,190
	Additional paid-in capital				2,859,699			1,192,998
	Retained earnings				2,605,372			2,297,848
	Accumulated other comprehensive income, net				40,648			54,772
	Treasury stock — common, at cost — none at September 30, 2003; 5,110,736 shares at December 31, 2002				—			(391,899	)

			Total stockholders’ equity		5,571,892			3,208,479

			Total liabilities and stockholders’ equity	$	50,258,839			33,201,181


				Three months ended					Nine months ended
				September 30					September 30
In thousands, except per share				2003		2002			2003		2002

Interest income	Loans and leases, including fees			$	503,902		421,427		$	1,407,663		1,261,573
	Money-market assets
			Deposits at banks		77		21			132		61
			Federal funds sold and agreements to resell securities		25		458			1,815		2,647
			Trading account		182		43			430		149
	Investment securities
			Fully taxable		56,252		34,822			154,283		104,762
			Exempt from federal taxes		3,699		4,500			11,769		14,691

			Total interest income		564,137		461,271			1,576,092		1,383,883

Interest expense	NOW accounts				1,044		1,024			2,657		2,998
	Savings deposits				25,154		27,797			76,422		81,743
	Time deposits				39,625		54,168			122,561		190,788
	Deposits at foreign offices				3,203		1,793			9,208		5,100
	Short-term borrowings				12,655		14,197			38,388		38,905
	Long-term borrowings				51,858		47,101			149,401		138,622

			Total interest expense		133,539		146,080			398,637		458,156

	Net interest income				430,598		315,191			1,177,455		925,727
	Provision for credit losses				34,000		37,000			103,000		89,000

	Net interest income after provision for credit losses				396,598		278,191			1,074,455		836,727

Other income	Mortgage banking revenues				38,782		30,336			117,161		81,529
	Service charges on deposit accounts				90,927		43,072			220,158		123,408
	Trust income				32,314		14,432			80,153		45,555
	Brokerage services income				13,320		11,055			37,729		34,052
	Trading account and foreign exchange gains				4,666		287			10,996		1,716
	Gain (loss) on sales of bank investment securities				58		(660	)		541		(659	)
	Other revenues from operations				51,527		29,824			130,600		88,152

			Total other income		231,594		128,346			597,338		373,753

Other expense	Salaries and employee benefits				214,118		123,388			543,673		372,543
	Equipment and net occupancy				48,450		28,073			123,497		81,004
	Printing, postage and supplies				9,092		6,988			27,031		18,892
	Amortization of core deposit and other intangible assets				22,538		13,011			56,807		39,696
	Other costs of operations				102,202		72,511			318,817		198,387

			Total other expense		396,400		243,971			1,069,825		710,522

	Income before taxes				231,792		162,566			601,968		499,958
	Income taxes				75,329		52,449			194,927		161,757

	Net income			$	156,463		110,117		$	407,041		338,201

	Net income per common share
		Basic		$	1.31		1.20		$	3.68		3.65
		Diluted			1.28		1.16			3.59		3.53
	Cash dividends per common share			$	.30		.25		$	.90		.75
	Average common shares outstanding
		Basic			119,727		92,017			110,607		92,625
		Diluted			122,593		94,942			113,441		95,714


					Nine months ended September 30
In thousands					2003			2002

Cash flows from	Net income				$	407,041			338,201
operating activities	Adjustments to reconcile net income to net cash provided by operating activities
			Provision for credit losses			103,000			89,000
			Depreciation and amortization of premises and equipment			44,876			29,102
			Amortization of capitalized servicing rights			37,151			28,663
			Amortization of core deposit and other intangible assets			56,807			39,696
			Provision for deferred income taxes			(35,806	)		(36,275	)
			Asset write-downs			376			888
			Net gain on sales of assets			(609	)		(2,333	)
			Net change in accrued interest receivable, payable			(4,797	)		(25,828	)
			Net change in other accrued income and expense			116,740			27,829
			Net change in loans held for sale			201,695			36,511
			Net change in trading account assets and liabilities			(18,995	)		(2,678	)

			Net cash provided by operating activities			907,479			522,776

Cash flows from	Proceeds from sales of investment securities
investing activities		Available for sale				71,146			45,680
		Other				146,573			20,545
	Proceeds from maturities of investment securities
		Available for sale				1,777,298			669,225
		Held to maturity				76,461			84,426
	Purchases of investment securities
		Available for sale				(2,550,587	)		(1,830,418	)
		Held to maturity				(90,727	)		(64,150	)
		Other				(149,327	)		(54,971	)
	Additions to capitalized servicing rights					(46,938	)		(49,807	)
	Net increase in loans and leases					(1,450,204	)		(1,223,305	)
	Acquisitions, net of cash and cash equivalents acquired:
		Banks and bank holding companies				2,134,822			(2,400	)
	Capital expenditures, net					(23,310	)		(11,776	)
	Other, net					86,512			9,472

		Net cash used by investing activities				(18,281	)		(2,407,479	)

Cash flows from	Net increase (decrease) in deposits					(169,614	)		962,900
financing activities	Net increase (decrease) in short-term borrowings					(136,941	)		764,917
	Proceeds from long-term borrowings					1,299,568			1,000,792
	Payments on long-term borrowings					(823,611	)		(153,214	)
	Purchases of treasury stock					—			(240,314	)
	Dividends paid — common					(99,403	)		(69,268	)
	Other, net					37,642			47,850

		Net cash provided by financing activities				107,641			2,313,663

	Net increase in cash and cash equivalents				$	996,839			428,960
	Cash and cash equivalents at beginning of period					1,284,131			1,006,750
	Cash and cash equivalents at end of period				$	2,280,970			1,435,710

Supplemental	Interest received during the period				$	1,590,377			1,384,475
disclosure of cash	Interest paid during the period					432,003			483,526
flow information	Income taxes paid during the period					182,398			205,794

Supplemental schedule of	Real estate acquired in settlement of loans				$	13,755			14,793
noncash investing and	Acquisition of banks and bank holding companies:
financing activities			Common stock issued			1,993,956			—
			Fair value of:
				Assets acquired (noncash)		14,355,837			—
				Liabilities assumed		14,496,703			—


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


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


PART I. FINANCIAL INFORMATION
	Item 1. Financial Statements.
		CONSOLIDATED BALANCE SHEET (Unaudited)
		CONSOLIDATED STATEMENT OF INCOME (Unaudited)
		CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited)
		CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY (Unaudited)
		CONSOLIDATED SUMMARY OF CHANGES IN ALLOWANCE FOR CREDIT LOSSES (Unaudited)
		NOTES TO FINANCIAL STATEMENTS
	Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
PART II. OTHER INFORMATION
	Item 1. Legal Proceedings.
	Item 2. Changes in Securities and Use of Proceeds.
	Item 3. Defaults Upon Senior Securities.
	Item 4. Submission of Matters to a Vote of Security Holders.
	Item 5. Other Information.
	Item 6. Exhibits and Reports on Form 8-K.
EX-31.1 302 Certifictaion for CEO
EX-31.2 302 Certifictaion for CFO
EX-32.1 906 Certifictaion for CEO
EX-32.2 906 Certifictaion for CFO

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