M&T Bank Corporation (MTB) Earnings Call Transcript & Summary

Hello, and welcome to the M&T Bank Corporation's Annual Meeting of Shareholders. Please note that today's meeting is being recorded. It is now my pleasure to turn today's meeting over to René Jones, Chairman and Chief Executive Officer of M&T Bank Corporation. Mr. Jones, the floor is yours.

Good morning, and thank you for joining the Annual Meeting of Shareholders of M&T Bank Corporation, which sadly we've had to hold virtually this year. As you may know, it's been our tradition to invite our shareholders to an in-person meeting each year at our headquarters here in Buffalo, where the Chairman provides an update on our performance over the past year on our vision for the bank going forward. I think it goes without saying that this year will be a different experience. I look forward to the time when we can gather together again in person. I'm René Jones, the Chairman and Chief Executive Officer of M&T. Our Board of Directors and our management group are connected by telephone. Here in the room with me, though sitting quite far away, are Darren King, the Chief Financial Officer of the company; and Marie King, the company's Corporate Secretary. My predecessor referred to Ms. King as the Boss. The Inspector of Election is John Zak from the law firm of Hodgson Russ LLP. As indicated in the proxy materials for this meeting, the following individuals were appointed by the company to serve as proxies and vote on behalf of the shareholders. Emily Bittenbender, Managing Partner of Bittenbender Construction in Philadelphia, Pennsylvania; Nancy Carey Cassidy, Executive Vice President and Chief Operating Officer of Picotte Companies in Albany, New York; and John Mezzalingua, Chief Executive Officer of JMA Wireless in Liverpool, New York. I want to thank each of you for serving today. Before we begin our official business, I'd like to take a moment to acknowledge Brent Baird. And on behalf of all of us at M&T, to thank him for 37 years of service to our Board of Directors. I also want to thank him personally for the wisdom and guidance that he shared with me over the years, especially since I became Chairman. Brent has had a profound influence on the culture of M&T Bank, helping to build and shape our culture so that as we grew we would be a source of strength and service to our customers, communities and all of our constituents, which we have been for all of his 37 years and will continue to be well into the future. As you know, Brent has decided not to stand for reelection as a Director of M&T, though we know he'll continue to be involved as a shareholder, as a mentor and as a friend. Brent, thank you for 37 years of service and for all you've done to help make M&T the company it is today. And now I'd like to call the Annual Meeting to order. Madam Secretary, do you have a report?

Mr. Jones, I can report that proper notice of this Annual Meeting has been given to M&T's shareholders. I can also report that the Inspector of Election has executed his oath of office.

Could the Inspector of Election please advise us as to whether a quorum is present?

Mr. Jones, the quorum is present. Shareholders holding more than a majority of the outstanding shares of the common stock of the company are either present at this meeting or represented by proxy.

Thank you. The Annual Meeting is now formally convened for the transaction of business. Any shareholder who intends to vote during the meeting via the virtual meeting website rather than by proxy should follow the instructions provided on the meeting websites. At this point in the program, it is customary for the Chairman to deliver remarks, and I'd like to thank you in advance for allowing me the opportunity to share a few thoughts with you. Let me begin with our financial position. Over the past couple of months, the economy has shifted precipitously. Yet, M&T Bank remains well positioned to help provide strength and stability to you, our shareholders, to our customers and to the communities that we serve. We entered this year coming off of a very strong 2019 in which M&T ranked first among our peer group of large super regional banks in terms of return on average tangible common equity at just above 19%. And we also ranked the highest in terms of return on average tangible assets, providing a healthy cushion with which to absorb unexpected changes in the economy where they are to occur. At the end of last year, M&T's allowance for future loan losses exceeded annual charge-offs by 7x. And last year, while operating earnings per share grew by 8%, more importantly, tangible book value per share grew by 9%, giving us more than 2x the level of capital now than we had when entering the 2008 financial crisis, a crisis, of course, in which M&T was one of the only large banks to remain profitable, not to cut its dividend and not to raise supplemental capital. Yesterday, Darren King, our Chief Financial Officer, reported earnings per share, of course, after setting aside additional reserves for future loan losses, of $1.93 for the first quarter of the year. While 42% lower than last year's first quarter, these results demonstrate our ability to remain solidly profitable in the face of an uncertain economy. It is in this context that our earnings report and our Annual Meeting come at a pivotal time. In times like these, times of crisis, one can often look to history for lessons and guidance. On January 8, 1790, President George Washington delivered the first State of the Union address to Congress. John Adams, our second President, continued the practice. But after his speech in the year 1800, President simply submitted written reports to Congress. It was President Woodrow Wilson, who resumed the tradition of giving the State of the Union speech before a joint session of Congress in 1913. Notably, in his address, he called on Congress to pass legislation that would create a central bank for the United States in order to promote stability and reduce panic in times of economic uncertainty. Three weeks later, the Federal Reserve was established. The State of the Union tradition then continued for several years but paused again in 1919 because the country, indeed the world, was suffering from the effects of a great influenza pandemic. Today, we face another pandemic of global proportions. It has reached our shores, invaded our communities, and for many of us, taken friends and family members. We often hear it said that these are extraordinary times, and they are. But as we know from history, they are not all together unprecedented. Under both historical precedent and current circumstances that we are unable to hold our Annual Meeting in person today and unable to continue our traditional Annual Meeting speech seems insignificant compared to the suffering going on around us. By those who are ill, those who are bereaved, those who have lost their jobs and those who are shuttering their businesses. Clearly, this is not a time for big meetings or big speeches. It's a time for action. Because as community bankers, we have much work to do. At M&T, our mission is well known by our colleagues. The role we play, the work we do, it's all part of our community banking culture, and we have no need for speeches to remind us of this. Indeed, it's times like these for which M&T is built. We are a bank that is powered by a team of skilled, experienced, caring professionals, bankers who live and work in the communities we serve and who are dedicated to our customers. We're a bank that is intimately connected to our customers and communities, and we understand their individual circumstances and their unusual needs, their unique needs. We're a bank that acts as an effected intermediary. Not just of deposits and loans when times are good but in an emergency, as an intermediary between government and local businesses, a role that we're playing today with the SBA Paycheck Protection Program, the Economic Injury Disaster Loan program, the SBA loan deferral program and as we will with other programs that are likely to be initiated. And we're a bank that is strong and stable and able to provide consistent, uninterrupted service, including credit to our customers when they need it the most. We can be a source of strength because we come from a position of strength. And it's from this position, led by our team of experienced and dedicated bankers, with their ability to understand local needs, to understand both capabilities and the limitations of our customers that we are responding to the current crisis. Whether shifting almost 90% of our colleagues to a work-from-home posture or successfully processing 27,711 emergency SBA loan application, I could not be more proud of the commitment and compassion that my colleagues have demonstrated under difficult and demanding circumstances for each other, for our customers. But what's equally inspiring and equally important is the way our communities have rallied together, to care for the sick to solve problems, to help neighbors, to flatten the curve. Together, with all my colleagues, we're simply proud to be one small part of those communities and those solutions to be a source of strength and of service, both for and with our neighbors. It is for them then, for our families and friends and neighbors, our children, parents and grandparents. For all those on the frontlines, the essential workers, the first responders, the doctors and the nurses and for the most vulnerable among us, the elderly, the unemployed, the hungry, the sick and the suffering, for them, we will carry on, not with the tradition of an Annual Meeting speech but more importantly, much more importantly, we'll carry on as community bankers and as community members, serving others in their time of greatest need. History is filled with examples like these. Time and time again, the world has faced great disasters and great challenges. Yet, time and time again, ordinary people and ordinary communities rise up and come together to accomplish extraordinary things. The same was true after the influenza pandemic a century ago. The economy recovered, society recovered, communities recovered and the State of the Union Address resumed again in 1921. So let us look to the past for strength and resolve to the future with determination. Together, as colleagues, as families, as neighbors, as communities, as we work to keep each other healthy and safe, to help alleviate suffering and to fulfill our vital mission as community bankers. Thank you. Let's now turn to the rest of the agenda. The first proposal to be considered is the election of 17 Directors for a term of 1 year until their successors have been elected and qualified, which is described in the proxy materials for this meeting.

Mr. Jones, on behalf of the Board of Directors, I nominate for election as directors of the company to hold office until the next Annual Meeting of Shareholders and until their successors have been elected and qualified. The persons listed as nominees in the company's proxy statement dated March 9, 2020.

I declare the voting opened on the Election of Directors. The second proposal to be considered is the approval of the compensation of M&T's named executive officers, which is described in the proxy statement for this meeting.

Mr. Jones, on behalf of the Board of Directors, I move for the approval of the compensation of M&T's named executive officers as set forth in the company's proxy statement dated March 9, 2020.

Voting is now open on this proposal. The third proposal and last item to be considered is the ratification of the appointment of PricewaterhouseCoopers LLC as M&T's independent registered public accounting firm for the year ended December 31, 2020.

Mr. Jones, on behalf of the Board of Directors, I move for the ratification of the appointment of PricewaterhouseCoopers LLC as the independent registered public accounting firm of M&T for the year ending December 31, 2020, as set forth in the company's proxy statement dated March 9, 2020.

The voting is now open on this proposal. We will now give 30 additional seconds for voting to be completed on the virtual meeting website. [Voting]

Thank you. I declare the voting closed. At this time, I'll respond to questions from shareholders, which would have been submitted prior to the meeting. Ms. King, have we received any -- have any questions been submitted?

No, Mr. Jones. We received no questions.

Thank you. Having no questions from shareholders, would the Inspector of Election now please give his report.

Mr. Jones, I can report that all of the nominees for Director were elected and that proposals 2 and 3 were approved.

Thank you. This concludes our agenda. I want to thank you again for participating in our Annual Meeting today. Even if joined remotely, it's important for us to stay united in purpose as we work together to overcome the challenges that we face. Our meeting is over, but our work is just beginning and our commitment to our colleagues, our customers and our communities remain steadfast. I wish you all good health. Please stay safe, be well. There being no objection, the 2020 Annual Meeting of Shareholders of M&T Bank Corporation is adjourned. Thank you.

This concludes the meeting. You may now disconnect.