M&T Bank Corporation (NYSE:MTB) Q2 2016 Earnings Conference Call - Final Transcript

Jul 20, 2016 • 11:00 am ET


M&T Bank Corporation (NYSE:MTB) Q2 2016 Earnings Conference Call - Final Transcript


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Ladies and gentlemen, thank you for standing by. And welcome to the M&T Bank Second Quarter 2016 Earnings Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. [Operator Instructions] Thank you.

I would now like to turn the conference over to Mr. Don McLeod, Director of Investor Relations. Please go ahead, sir.

Donald J. MacLeod

Thank you, Paula, and good morning. I'd like to thank everyone for participating in M&T's second quarter 2016 earnings conference call both by telephone and through the webcast. If you have not read the earnings release we issued this morning, you may access it along with the financial tables and schedules from our website, www.mtb.com and by clicking on the Investor Relations link. Also before we start, I'd like to mention that comments made during this call might contain forward-looking statements relating to the banking industry and to M&T Bank Corporation. M&T encourages participants to refer to our SEC filings, including those found on Forms 8-K, 10-K and 10-Q for a complete discussion of forward-looking statements.

Now, I'd like to introduce our Chief Financial Officer, Darren King.

Darren J. King

Thank you, Don, and good morning, everyone. Since this is my first conference call as Chief Financial Officer, I'll ask you to bear with me. Rene Jones most recently and Mike Pinto before him, set a high bar for CFOs in general and for M&T Bank in particular. I certainly have big shoes to fill. Before I start, I'd like to take a moment and thank Rene for the advice and guidance that he's provided to the Company and to me personally over the time that we worked together, particularly during the last 90 days. I'm looking forward to working with many of you as well over the coming months and years.

Let's get started. In the second quarter, we generated $1.3 billion of revenue, net income of $336 million, and diluted earnings per share of $1.98. Return on assets were 1.09% and return on common equity was 8.38%. Looking at the second quarter results on a net operating basis, which excludes the after-tax effect of merger-related expenses and amortization of intangible assets, earnings per share equaled $2.07. Return on tangible assets was 1.18% and return on tangible common equity was 12.68%.

Every measure noted above both on a GAAP and net operating basis improved from the first quarter. The efficiency ratio also improved to 55.1% in the second quarter, down from 57% in the first quarter, and 58.2% in the year ago quarter. We were able to deliver these results against the headwinds that we and our clients faced, including an uneven economic recovery in growth, persistent low interest rates and volatile financial markets.

There are many highlights from the second quarter that characterize the state of the bank and before we review the details, I'd like to take a minute to review a few of the more noteworthy developments. Probably the biggest highlight of the quarter