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M&T Bank's strong fourth quarter caps a year of record profits

M&T Bank Corp. achieved record-high profits in 2018.

The Buffalo-based bank on Thursday reported $1.9 billion in net income in 2018, up 36 percent from $1.4 billion in 2017.

M&T finished 2018 on a strong note, with a 69 percent increase in fourth-quarter profits, to $546 million. Its net operating earnings of $3.79 per share easily topped analyst forecasts of $3.51 per share, according to Zacks Investment Research.

M&T benefited from the federal tax overhaul in early 2018, but also reached the record high based on its own growth, prudent lending and "thoughtful management of expenses," said Darren J. King, M&T's chief financial officer. "It's all of those things combined."

Last year was the bank's first full year with Rene F. Jones as its chairman and CEO. Jones was named to those roles in December 2017 shortly after Robert G. Wilmers died.

King said the bank generally expects slow, steady growth in 2019, based on how the picture looks now.

M&T remains open to acquisition opportunities if they surface, King said. "Our willingness to engage in discussions is there, as it always has been," he said. "It's really whether or not folks on the other side of the table are ready to be willing sellers. And it doesn't appear that that sentiment has changed dramatically from where we were through most of 2018."

King elaborated on the acquisition climate in response to an analyst's question on a conference call.

"When you look at the market and what's happened with bank stocks and with multiples, the whole industry's re-rated down, basically together," he said. "(M&T) had a better December than some others did, but we're still all relatively down.

"For someone to think about selling or for acquisition math to work, it's about the difference between the buyer and the seller in some cases," King said. "The relative differences haven't changed from what it was a few months ago. And I don't think we've heard too much where people are capitulating and thinking, 'The world is coming to an end and it's time to sell my bank.' "

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