M&T Bank (MTB) 19 Apr 212021 Q1 Earnings call transcript

Thank you for standing by, and welcome to M&T Bank's First Quarter 2021 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the prepared remarks, there will be a question-and-answer session. [Operator instructions]. Thank you. call Don the to turn now over MacLeod to begin. I'll ahead. go Please

XXXX both you, everyone. webcast. participating all quarter morning, and in conference like first Thank good you I'd Maria, through telephone by and to thank M&T's earnings the call, for

link. you schedules we statements effects Forms today earnings call is and we and from release the before the with XX-K like on www.mtb.com the M&T's clicking will morning, the read our encourages mention issued with the Presentations Investor refer I'd the statements. Darren it on our on and this not and X-K, the Events in may call. virus. Jones speaker website, rejoin including to King discussion forward-looking and access former René CEO, along earnings his expects not filed draw then shortly. primary Relations we participants industry financial during have that the Also, He In to M&T might to skills start, of to this and filings If is SEC recovering and us will us Bank banking absence our as from comments today's CFO form be connection release relating you Corporation. for made complete to M&T tables on the his forward-looking contain link and of by COVID-XX a XX-Q, with to

Executive, our I'd Now like introduce René Jones. Chief to

five But the it that I the CFO is with word, was happy everyone. years Thank well Darren you, over Darren When you skills. went the and I Don, boldly for handle be you a possible. but is thank to have of was my clamoring we a handed call. to doing things Darren expect one ago, back the call although action morning, job I just good that Don, reins And as that -- won't as that good return job, not volunteered the such agenda today. so soon shortly, I’ve do his to and good using to

are Credit Spychala, on Joining them. both I'm both call know of whom our me -- sure the Bojdak, and today Officer, you our Corporate Mike Bob Controller, Chief

$X.XX or or This its which Financial. M&T's excluded net million reporting have practice, $XX operating well for gains in any of the the this mergers the expenses with common residential $X.XX million quarter the of to and amortization million Net in the Consistent strong quarter. amortization of X.XX% with acquisitions. indicative quarter the the average equity $XXX tabular on was reconciliation the previous portfolio of and GAAP intangible $X supplemental with per was of The surge GAAP and recent first the merger-related per year. basis, quarter. banking the results a merger-related recent average XX.XX% in guidelines, we year's forecasted press were in Wilmington our operating pleased equity. yielded common per XXXX. with On last first was returns associated Trust the assets and $X.XX proposed XX.XX% income with XX.XX% noticed expenses, $XXX $XXX produced rates comparable amounted In return which million, rates for we're This first million in of from of income salaries share. assets compared acquisition expenses intangible intangible $XXX year was in linked state first with well-controlled of average to morning's with and quarter. and compared of the on results for quarter. of earnings in last in after-tax first an results of compared earnings a million, ever rate seasonal $XXX as on and quarter shareholders’ United and and release $XXX $X.XX and asset prior X.XX% from common the of income million of equity Also, People's X.XX% and tangible quarter to were SEC $X.XX trends and quarter in from the annualized X.XX% of we the or tangible and compares quarter’s basis, in a assets M&T's charges M&T in quarter fourth loan XXXX, assets, quarter after-tax first the related press are of tangible long-term annualized in expenses respectively or after-tax the XX.XX%. results excludes change the million little quarter share, $X linked recent net quarter. momentum provides as million accordance amounting effects the morning's quarter, for of our release, benefits, Included per the the Diluted included the with quarter return in and for an of amortization the annualized in common first of quarter, and a ago credit fourth and results, with contains mortgage As Group Diluted this remained $X.XX Net the $X.XX including share fourth businesses. and operating Outside in share last improvements of average usual Net compared in XXXX, of our on non-GAAP year's were common GAAP quarter of XXXX's operating economy. quarter. GAAP quarter, return in only tangible $X.XX

the in higher was higher securities. X and a take the from offset on deposit linked quarter $X calendar million from quarter. The the look the in level interest in basis X quarter. quarter the X% X% cash XXXX, the X interest X% Federal level $XXX past primarily of interest quarter. Reserve, fewer margin The the Reserve was by accrual shorter cash This market X% interest placements, the basis Changes in X of loss with margin first that the details. interest and with average the nearly Similarly, of million the earnings loans linked reflects compared grew reduced effect estimated outstanding benefit income the with from average X.XX%, point basis Federal quarter. primary a quarter of assets decline Taxable fourth a increased income down underlying on in previous points, million partially for shorter at Compared which assets, income investment by minimal with we a of driver with let's decline equivalents X% was decline margin net linked equivalent compared was the $XXX cash the XXXX, quarter. some in quarter So net a points reflecting and the of money increase deposit an of by earnings some for a days. rates quarter. had including Average in reflects the

or loans, Excluding X%. PPP billion grew loans over average $X.X

estate PPP million compared with levels low of X.X% reflects indicative grew real quarter, quarter. loans, timing to lower plan Looking PPP runoff on were that loans an average of average the indirect of basis nearly up other quarters loans subservice, compared $X fourth end Due customer PPP has the at auto billion $X by partially with office bearing from declined loans to M&T's received X%. loans. offset been of $XXX core and floor up Islands essentially fourth core by over the quarter. we deposits. from $X.X by growth loans Commercial offset declined of prior increased the in declines $XXX,XXX activity. home to up totaled loans very $X non-interest deposits billion, billion. On On compared Mae fourth the Cayman by -- $X.X real CDs an The end-of-period to of Ginnie deposits average X% dealer an end-of-period were lines purchases loans expectations. category quarter. That from Consumer receipt quarter. payments, at with than the partially which and Residential X%, the increased Commercial the customer was and flat That billion increase of and and and at recreational C&I basis, or nearly figure includes finance deposits, exclude activity from further Average consistent outpacing balances where the our in loans. acquired originations loans. linked loans billion mortgage loans less estate pools equity consistent recent of were loans industrial basis,

basis, increased deposits were but an on XX% sorry, XX% basis. an essentially decreased office flat average but were on end-of-period an on basis, average Foreign --

valuation preferred the recent losses with linked remaining quarter $XXX income. to for quarter XXXX's holdings stock, million $XX totaled equity million final included our million of Non-interest gains. million GSE non-interest largely the $XXX securities, Turning while The of of quarter. in the first quarter on compared included $X income

Over year's the distribution received may million received a this the you Results distribution past million timing, the XXXX quarter and distribution a has the for of quarter M&T year. the a from past received first change from -- Bayview first included Lending few $XX Group years, a of the fourth the linked $XXX quarter, million $XXX first the $X in from quarter quarter. banking of know, in in in as expected. XXXX, million in Mortgage M&T were million revenues recent the was No quarter. $XX distribution down as in

million. from million under and million and originations customer with improved perform increase $XXX about higher figure of amortization balances the activities, well. $XX linked Commercial reflects decline rose in fourth first from of the ago which assets the the $XXX the expenses merger-related the Trust that from first the $XXX in $XXX million Service $XX year previous quarter. million quarter, is a were servicing margin. the the to quarter, year comparable in seasonal increase management, That result in for million continued business the assets the Operating $XXX were in in expenses, figures on gain quarter. and operating sale X% up linked for the the mortgage banking were million growth billion the institutional from originated prior the first fees. were were quarter. is the expenses million $XX $XXX -- quarter. income $XX quarter. million residential $XX businesses. mortgage The quarter, decline of recent in recent quarter were in on exclude wealth linked $XX sale turning ago from in to quarter improved intangible revenues Residential quarter. quarter, That the including million reflecting offsetting both was million loans $X.X quarter, in Revenues fourth quarter. in business, result deposits mortgage million charges in and in The The from activity-based Our to improved compared

compensation operating results, eligible compensation -- for the quarter As expense recent for costs is of contribution, to approximately million the to match first payments insurance. equity HSA included on and impact expenses relating last of first typical recognition and for an of of employees, annual salaries million increase $XX accelerated benefits incentive retirement payouts and Those the in certain the FICA the same amounted higher quarter year's seasonally quarter. items M&T's fiscal approximately unemployment compensation $XX in accelerated XXX(k) to

seasonal to those quarter. we allowance expect cost included valuation servicing a reduction enter past significantly the we factors rights. Other usual, the mortgage our the capitalized for second $X on of as million quarter decline in operations As

compensation quarter's last was year's recall to Foundation intangible The and ratio, M&T million $X in we there XX.X% quarter also and addition the in in was first losses securities XXXX, Charitable XX.X% first numerator reflect first compared talked XXXX's amortization to a in in the XXXX about. the and elevated from and The the fourth of XXXX's You'll the allowance XXXX. each million that quarter quarter $XX seasonally XX.X% denominator, the from elevated reflect with efficiency an recent excludes of the fourth quarter. which ratios gains or contribution quarters the that in addition quarter results Those a expenses

some overall to course, but sectors as to pressure. economy, let's of continues to Next, hospitality, improve, credit. turn continue such face The

losses. by consistent recent the of downgrades the delinquencies of to recapture and million method the we accompanied the reserves from transition year economic end worsening the the the preceded accruing of criticized differences compared the of case provisions credits in and of uncertainty of amounted loss the The was accounting reflects as COVID-XX to said, CECL, outlook non-accruing the cautiously to in last uncertainty optimistic based fourth prior last the defaults the allowance Previously with pandemic our the reserves. for reflect loans. -- $XX of between quarter. the Under projected to and year. $XXX activity, for to at recapture pandemic of The us the quarter net of the to to in quarter, the ultimate reduction course beginning as loss Significant of ongoing impact allowance identifiable to loss effects additions quarter first status over year's levels The losses, of XXXX, and and quarters. million on by leaves the standard the the the emerged or at million continued decline $XX incurred greater to in in in recent for on levels recent or economic with the $X.X economic stress last That establishment collectability recent financial the for the employment criticize charge-offs scenarios. credit the adopted resulting quarter continued improving quarter increased the with specifically non-accrual credit of credit former from losses loans ongoing billion highlight CECL evidenced a provision end combined quarter. borrowers reported of first and As XXXX previous delinquencies the allowance

Our variables the being of macroeconomic drivers with largest number unemployment rate GDP. uses the a and economic forecast

continue Our the X.X% X.X% resulting annual assumes improvement, GDP of during during unemployment assumes -- at annual to followed XXXX, XXXX. The rate at of an reaching GDP to forecast XXXX, by in sorry, by returning XXXX end X.X% rate I'm X.X% pre-pandemic forecast the through that the levels, a -- levels XXXX. by elevated on gradual grows end average, national be

stimulus, This of end was monetary actions. $X.X the X.XX% end improved to fiscal not December. slightly Our loans but at Non-accrual of last X.XX% up or forecast any government loans considers further or the amounted from billion at March. of

charge-offs Loans XX charge-offs basis loans $XX net basis quarter total points quarter. for a XX% of Annualized were percentage of in for quarter, XX were with quarter net interest, on the loans as noted, which end to guaranteed XX the first government-related the amounted $X.X accrue points recent As fourth days the of million. by compared entities. continue recent to due, billion at we those past the were

X at earnings was assets slight an and capital. XX.X% equity net of XX.X% to M&T's fourth ratio common of Turning reflects end Tier reduction a which quarter, and estimated the compared the with risk-weighted dividends. in

-- merger pending. stock any United We People's that don't to repurchase is plan in while activity the noted, pending. previously As is engage repurchases activity

the to outlook. turning Now

XXXX economy continues from from the funds reach way to and outlook consumer enough improve January seen stimulus shared programs change While commercial in and what significant the any our for clients, we call. we on haven't in our

at improved merger-related to And comments quarter, provide announcement. contemplate supply as from net updates. expenses don't from predate don't to merger. and income, the hold. reserve outlook release still fees the growth, our -- and interest this evidenced any course, as the the any by time intend credit Aside loan We those, are announcement impact I of merger Darren's of remarks the

uncertainties regional from may interest various other Of aware, national projections assumptions events changes in political our what in economic a materially growth, to the of number and differ regarding future. and are and you're course, actually factors, macroeconomic subject which as unfolds rates,

now the the call questions So which briefly up let's before Maria open to review will instructions.

Instructions]. [Operator

first the from Ken question Zerbe comes line of Stanley. Morgan Our of

and read sounds applying of release, press overlays still in qualitative off, amount start to you're there's just fair of reserve guys release qualitative continues quarter? negative are overlays even that you that but the way meaningfully -- a negative lot off, see the the you like are it comments, of of to terms come that quarter. actually market, assume the a uncertainty fairly economy Maybe and your this next released slowly some we reserves get expense to fair pretty those better a more could provision that if material the still it in Is

think I the saw book. think releases quarter, guess of projection allowance largely is, we reflective at that at improvements I the you've those how in book way think good time you even GDP, in got about down, consumer that as for the you to about great is look everywhere. And the I the of and thing right? the of while this uneven, we're know, projections unemployment it's and GDP and if things one seen. C&I that of having period unemployment we've coming is about it's unique the are So projections our end the not And worked commercial it

entertainment, of right, are And the so some and behind. lagging travel affected are that by still places

example, see like bookings particularly exposures. seen in So hotel our things, for and to our fall, yet scheduled for while improvement, the really CRE the we've higher the we've and summer

signs I reserves in the areas, overlays, for which So would would we before the portfolios. word those in without that think reduction particular looking be improvement any those required using we're of on see

And a follow-up then as question. just

sizable up fairly that cash You're securities cash deposit growth. position, are the about a How obviously investing given building all potentially? of thinking you into higher-yielding some

question. lot a give It's of great We thought. a

I the with idea the related use billion would that excess our and what liquidity that we we had would quarter, And transitory. think think it what the call, of is end a of to thought, portion of probably huge at for beyond probably, position. our first starts $XX clearly I use I liquidity

Now in so when thought long we -- first have low-return transition? we is to issue that how assets. it the does big invest we that And is hate

your low. we you So securities we securities go that on book one Having own. smallest think in returns the there. too out The job do to could that cash all it's don't said that, do of because you are our of invest have for off

go. of want we're of make low idea how monitoring so And this constantly that to sort we do

those see time, of customers. behavior long-term that's permanent in growth, the thing of interesting things, happening activity and growth that types is the what's is more the hard maybe be the over think to I may account So really

think may that I -- a But early do a level us, we of more which cash So maybe see investing to might see infrastructure it's And return, as things of little those not that, would dollars. see, balances we higher when I like quite but be becomes clear a today. a of we because spending for too time. more some think we think when do think while for and I

Evercore next question John of of ISI. Our Pancari

touch I to on maybe loan wanted demand. just

seeing interested If pickup little separately as of CapEx signs on And you're side, about the really bit particularly at any the you any you you're in where are a improvement And seeing? side can you're the commercial talk seeing what activity. pipeline seeing in all, front. consumer on on well, what then

Yes.

in in declines state quarters, really of So areas I see look if think, growth, remain the manufacturing, it's the any, we've quarter. that, slightly progress I low, space, X a look I was if steady you CRE on the back, C&I it's but areas M&A interesting, roll Having you some do just this know over because look slow. you particularly of did don't things a But seeing beyond you segment as activity, no if volumes if commercial flat very seen if limited, it's very demand as X, of there. either Utilization because the the in in there. in that, We're down the of there's said change, to margin. increase

is the higher activity is levels. at getting that So return done

-- that of positive some should as margin. on with loans. on we further that Things -- the have robust consumer some continues, we immediate remain still really that but should impact exception not as impact So -- have impact, remain HELOC the side as move the

on industry, release you by commercial the I noted side, the wonder also there I areas update could know then stress you us the wasn't real commercial know a on side. but that you necessarily the estate there credit separately on portfolio. indicated And estate real if quality of

the on remind update just could as you of well the give when trends? you if size that So reserve us some

Yes.

the our what our in And property stress greatest things both I'll be duration it the surprising that were like no under loans about to portfolio. kind criticized surprise, and travel, say the CRE the is, of it's the given greater So are -- continue hotel is, its face our amount not the stress. of hotels largest book. -- contributor to that the pandemic in to hotels impact really the on -- in And of in thing think type

although give in-place So from performance, the our you'll payments service contractual seen slight really remember as -- modification -- important slight me of seeing debt some improvement X we've an we're without support support portfolios hotel improvement, or can't that sponsors. some maybe second most their

you've was length so while Really that that in in $X is increased like don't seen we've depends the is the loss credit the half expect other means what beyond time. a classifieds, billion quarter, in space. this that about increase the about classified of the hotel said will what seen contribute and our the of risk increase an So of the that to is, just those that we really because sponsors of underlying downgrades strength Having that, of value collateral. grade, factors like that on --

we to much of You'll have an didn't example. notice increase non-performance, that for

been In terms what our First, our that X strength all the are we've of excess collateral: properties of and factors, of the to of mission a million that in classified $X we've been on are reappraise status. is in doing hospitality those

exposure. $X.X that that for little properties, So a and XXX billion reflects accounts in

that of declined reflect through of all LTV. have X% of a in XX is stabilized XX% then of mind the February really decline, we've values so values thing the those finally, that that an you seem a XX% excess And far stabilized New come like Keep then a XX%, the they that I'd XX%, with improve. beyond, sponsors, seen that until decline. in to have not and in in seeing LTV XX% what talking loss remain that we have that of are City, the with this properties about we're starting necessarily you content. with in the an sense X% have that migration and a jump but our portion of So number indication classifieds expected, are a something shown due XXXX conditions to starts to and is, say right? low we're XX% as-is would year last space capable So normal about appraisals of above out. maybe it's decline as-is significant that gives strong first And but a and XX% if further that we supporting properties, And York pretty

we a numbers position I think watch So reserve we're the in good of change. know don't I stuff the this for to if have you. on kind specific

can no Yes, I get later that on. problem.

question Point. next the from comes Our line of Dave Rochester Compass of

know XXXX, better I versus mentioned the the no does on backdrop you little updates a rate but front interest a ago. guidance for months look today bit few

So NII you just at mentioned point. maybe year factoring know the low how that range to in. I talked that -- was I mid-single-digit you'd in you're for wondering about down if the

weaker Just great. just range, more thinking into it's what if offsets is that might still better other color maybe be Or was but some curious loan be growth good, is area? I it's would that likely? So any the or there, maybe you're there range

a Yes. good No, it's question.

that we're looking off margin, low are a say at think I I good change the in the decline But start. to would in single-digit margin. we year-over-year

about If quarter you of is trend. declining because you a how first the on toughest your you’re kind probably outperform you think do -- that,

long be we not excited moratorium the relatively that foreclosure I outperformed means and they'll are some It things results actually think but sheet produce And how then things the be sure extended like that cash so we're that balances balance Ginnie the longer, doing Mae. last, we're And high. means the we'll less that they So right? will on repooling the of there.

feel meeting good about I'd least and optimistic say So our -- projections. just the we least at at

front. loan then the maybe switching to And Great. Okay. just growth

how the the can then talk just it about recognized overall, fee, mentioned maybe buyouts. then for Mae quarter great. would looks forward? on was that just opportunity and there just wondering, be Ginnie You PPP just production I the And you going the for

part? Just again, say the last last part

so Sure. this and The in quarter? perspective you PPP from fee the the what an -- guys realized amortized quarter then production

Yes.

Okay.

the to to extension again, fewer going hard and to Ginnie’s, modification that. just Ginnie, we continue end working going of out, be the But there's purchase the to it because be So do keep find on particularly at the foreclosure of on will the we it. to opportunities think places day,

of terms In PPP the loans…

billion. $X.X

Mike, was X…? What it,

of Yes. X, we quarter, of $X.X in during $X.X about booked billion PPP most in had that and We the billion then March repayments.

total, flat million did interest push PPP relatively the income to was from repayments a a little in bucks slightly the of quarter. down last up the income from But couple So bit.

How much fees -- of now have the how do many left…? you that's way fees in

million. we not haven't modestly, don't We I disclosed next was significant it. it on But no were But almost we change by don't progressively -- that change. did expect down it think. will Maybe a number, we significant I'm That move. sure. $X And expect don't a change. quarter,

depends It right? pace the Yes. on repayments, of

your PPP you direction. income, take I $XX if margin in have, other the point excess margin all What basis basis I if activity essentially the have a balances that the of points. a will tell that, And about the has the about that X billion that takes printed before, you the impact also you is that when you cash, you if over exclude talked take all XX step didn't back up and that about think and we

X is well really terms. to what historical really interesting held from me that is So to noisy. little just margin factors, aside But it's compared those up a our has really,

those X because of can't see items. it You

next Gerard from the of Cassidy RBC. question comes Our line of

question for a you. Got

can at into of Federal coming with seen central you As a for such because questions you to deposits some big of X surge I the sheet organization sitting to you reserves quantitative understand dramatically have being the is that's us the you balance and that I so like touched of of the and banks on the your how in flow bank? walk easing, deposits now your our because the terms guess through your amounts forcing is, high entire have money cash I the in industry Chase can liquidity already in have up center of increase you such. Reserve up your the on for of why easing JPMorgan about quantitative deposits

events on -- prior called, raises right? just are -- accounts, We go a Yes. what to and the That's have focus stimulus, that I more So national we're the from never the always core operating going customer need actually to proportion our when outsized. kind all and cash, our of And you're think businesses that most, impact than with than of actually you accounts what a to money because question. you bank of mean more money operating across of do is the the into are what accounts. And have things raising taken monetary see happens great the operating see institutions, in Internet model. operating back to network, that cash on higher place, do predominantly with pandemic had accounts. the we M&T to all accounts, I customer going they operating have -- most as is core a than about customer our

that manage it that means Now we've got to very closely.

draw for both just say, let's core And that accounts. today, we're free a actually sheet that very concepts. But sure parking Again, comparison and renting the of a is principal nobody percentage for of reason. So operating else DDA example, sort and, balance our money nobody transaction between you making can wants. that's

and If differentiator. and the you the today, you'll that's across institutions, crisis information go before get that look, then see

would where Very out. up move money good. interest balances not more cash it's the picking rates going to take higher grow be businesses. to maybe where utilize And those would down, then they It their business to they activity the necessarily bring

Exactly. Exactly.

see. So that that's X begin you'll to

think going I -- see, and see consumer spending. side business, both you're more the on to You'll

be -- companies, be large about normal, factors, been example people gives just there's growth certain if with cash sentiment. maybe classic and so example, auto that's might built are for So the at fully would to X start because factors supply uncertainty much the of with still you the which I inventories, not it's up us from most then so building up. and not And forth. chains think back industry middle-market looking unlocked that's very right? preventing it loan the Remember,

spending, the increase fair opinion, for linger to me. ongoing both So would that are time, also way levels portion permanent my of a got to from going consumers -- a idea right. like that keep events of pandemics is starts cash commercial. this of long of business lot this and a but as that doing that customers you I think, to to very own will sense see and exactly higher a expect I makes

Very good. follow-up me. just question, you gave you in answer a it as And touched then and the on

shortage very autos. You're dealers of plan X the to written to chips production quite talk chain? are doing semiconductor of There's What throughout the better are financiers about Northeast Can affecting us about automobiles. telling the with they now? the floor supply your of the the And right a bit how issue you you?

doing the new activity to is said having it's because used fine, a are right, the all But right, cars. get I Well, that, there's there think dealerships around, for difficult very that cars. search

into the quarter, cars principal some And source dealers about nice sort which we sort the thought that What we offset unlocked thought so the supply them. and up, thinking on car and -- car, as record healthy. comes the are But a third means don't nice things, you lease, the car fourth used so just If for really your of highs prices go to why off were to is start come had right? actually are continuing this the really natural of one prices. you're high, those chains for There's prices down. were that buy they by of haven't last If quarter would of And on used reasons car year, of example, right? take and dealers. that as

Darren And good. is listening, quickly, better Darren. get Very if

Our Matt next O'Connor Deutsche Bank. of question

on Just the here discussion. part time cash of push the last X to maybe

seem want I about cash stick. definitely other some adds buy you my earnings. modest to I'd buying loan a rates, Like in to all going it's we your off peers, which it some XX% is it and you much? ask the like for than in if loaded and up why put seen you what waiting extremes And took banks, because your so think to some ask have asked I securities, on level, securities? confident that are pretty more you of for So growth. the cash at are to very better We've low question, of trends you're So a really material rise just but still second although I

what you waiting So are for?

of that how right? goes, question up we goes when through, sense decisions? didn't call ask kind range, making up XX-year don't And I we it Scott unless to toe it not that, position we internally, the money, in more dipped we right? constantly on So the exact what are find returns much prices really, respond we he a portfolios. might call make bit in perspective, while a I and but from itself -- got risk-adjusted was know it we meaningful make Because This these and see that -- on securities, little happy the how is but Are we market, way think significantly. it, we could its returns. don't and Matt. few So you risk-adjusted being to us. So purchase that our while we just we've XX-year then focused those better out right is up the I when this Darren long-term and we're XXXs What bond So move month. the really look we're Warman the we is back a or low more meaningful every for? see waiting And a at a change

on spread pass-throughs again. negative Matt, the turned option-adjusted

negative take to being convexity not you're the paid risk. So

that banks Well, agreed. you're a yes, locking some XX-year very questionable, differently, in, asset other it's think but so

question. So separate quarter. just ticked The a up bit loans little a this

X%. down of kind industry think the to X% I was overall

Mae You thing like big purchases. touched factor. Ginnie the on PPNR, already

everything, then, And industry how fare you doesn't growth, in the that. versus loan of you'll a do benefiting ex it trends here agree if loan much up, resilient. course, probably from are terms not of feels runoff. driving You're the what's having pick you like lead when M&T and things card I'm think more little as still up? but would from wondering But usually pack

customers our think are quarter C&I I before. that last and more quarter optimistic than the were they

think change. I to continue sentiment will that

you're PPP when going at this come the their on But has they you question to do effect. you quarter, they timing, up. I net do of space been and cash And the if activity. pretty be the look decent actually a we -- will think more see trend out use the matter C&I

and commercial and space. there, I it warehouse pricing lean make obviously, So on. think much doesn't the issue it's don't there, going sense pain one about, expect that a for because I from to do any us of and there's though, estate to better real into away, in a we've -- The but industrial. talked lot near resetting estate, lot prices have class talked also is a term, The that place there's perspective I the only where again, real lot an economic for everybody's about think economics -- been computed of so

I the to to growth So right we're but the take think optimistic it's loan just for start in about going some moving time long-term, direction.

question Bill comes the Carcache Research. Our from next Wolfe line of of

much acquisition. synergies can how closing, can markets just on XXXX know René, you will your in versa? is you But, United hit the everything your some have that look ahead of at opportunities running in initial in really the People's legacy focus M&T of as doing included you to revenue I vice ground weren't and the guidance discuss post there

talent at We done saying -- part each that this of that saw both of would one the are acquisitions, the of it's have. what by capable, lot all that with that I organizations of -- -- everything we're of businesses them funny stands out seen, -- among sort transition process businesses Well, the whole due integration is the set who the really on is, we -- actual diligence. impressed of on up the we're our right? where side in particularly their We've and have of two, kind are side not Yes. that a businesses sort just confirmed including we've the everything each we couple met, super teams, we that, have people don't of, of business really getting Number really everybody their running people. the start

we capabilities around that opportunity. you is treasury lot you're a of expertise, example, base that from to dialogue there's customer going with to side, extending M&T management, capital their key banking, our have business the exactly just just remind markets of talking So a going for on I'll And provide small we that think, about. the what some significant

with not necessarily for them. lot new capability Corp, needs Trust, Capital more New allows for wealth, to then the we're M&T have I meet estate but use think going their would balance Realty than we real our a combined us that's a to course, individually We that. England markets. the of which to sheet of clients, combined bring And Wilmington capabilities And

that M&T's the If we're finance you excited go business very way, the customers. small excited -- continue to business being and those other market and services about be to middle offer able equipment to and

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next Securities. question of Wedbush line from the comes from Winter Peter Our

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Yes.

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about give quarter, million we steady. just was million $XX -- about XX think you $XXX if quarter, that gross basis more to think net this recoveries. What million last think this down $XXX about to is that million, us that $XX about charge-offs different you you had we're of I a brought pretty of about recoveries, if points sense,

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the from comes of question of next Our line Usdin Ken Jeffries.

Just X question on the side. fee

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Yes.

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the did ended we slightly that same better kind momentum we than maybe we had or quarter. the the quarter during so of with And

into to what's to So move should going quarter. negative. that mean we with as predict help was next core underlying margin, trend that happen hard I slightly but

waivers? up that there, And aggregate? on in the incremental do an now so, another And sequentially. where line, then stands trust income market burden just if you have the -- good money performance fee know from right any you Did

Yes.

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today. increased of or And there. $XX by million that are amount are $X total quarter-over-quarter that I million in the think I that waivers million around $XX that think embedded have we

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it quarter million. around last think $X I was

million closer and be closing So mentioned more that would with $XX you the itself? contiguous

Exactly. Exactly. Separate

line of the of of Erika Our next question from Najarian comes America. Bank

questions have all you. my and asked answered. Thank René, been

Any other questions?

still There's more several queued up.

of Our Frank Sandler. comes Schiraldi from Piper next question

Let me guess ask you're going to cash. about

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Okay. on And quick PPP then a just follow-up forgiveness.

majority books. run should on, off of have the the your XXXX think that we a the of a How that from And PPP significant books wondering does current thoughts just about the in level loans quarter? You still on modeling?

No.

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sense. you some give So that should

Our comes next line Wells of question Mayo Securities. of the Fargo Mike from

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next of comes the question UBS. line Martinez Saul of Our from

did income the said mute. Sorry you swap of you I year. I this think from your million] book? number. I gave quarter on But hedge that. don't was for I'm to… about of not think much how [$XXX win you going full a

this It’s quarter. about $XX million

-- the and because temporary. matters in this get for I much context hedge of X portfolio. about would $XX about Yes. the sure morning. I'm looking little in of I'll say But rest always I'm on Well, the million. own, the stage their the about tend It's not worry at I -- hedges too to

replacing assets, back recessions, And our on so moving floating basically. hedges. is happening in roll-on be In you're decided or And the the from question you've the of margin the our would down rundown rest and you're moving assets to you're the what's into higher the with we -- portfolio. away commercial past that hedging the see we with loans, would rate stop them turned hedging, much to what fixed left slow is rate basically

the next growth real will it. mind. how change And Darren so think loan week. is my that That's in about issue I

you XX have think do. I days only XX to So way -- the

Got Good. it.

June could pick fee position to over bit think yield the you've about I closes? if won, to Just subject ask, you once you're 'XX now And is a optimal your and if I capital how capital the about thinking talked deal results. [XX%]

of you gives the cushion. I end lower sort that about at peer the being you a talked seemingly past in group. healthy So your of believe

capital are we into about capital 'XX? together, you how thinking and putting that as all optimization and optimal So capital head returns stuff

lower the is to end think construct our desire towards your run our is ultimately, Yes, of We peers. right.

that really part. last think a the under concentration test the you severe real really, I test -- hard is So particularly the you space, in think tells high starts redo to And that XXX the we basis right? We're pretty into points estate survive we have excess last today, above fall. we were context around the in. tell fall, space, which that to went [X.X], able to we went about stress and that

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floor over gentlemen, question. MacLeod additional remarks. I'd our or like back was the Don final closing and for to any that ladies to And turn

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

and ladies conclude conference does call. today's gentlemen. This you, Thank

disconnect. may now You