07.20.09, 10:26 AM EDT
NEW YORK, July 20 (Reuters) - M&T Bank Corp, a large U.S. mid-Atlantic regional bank, said credit losses and writedowns led to a 75 percent decline in second-quarter profit, though operating earnings topped analysts' forecasts.
Net income applicable to common shareholders of the Buffalo, New York-based lender, which counts Warren Buffett's Berkshire Hathaway Inc among its largest investors, fell to $40.5 million, or 36 cents per share, from $160.3 million, or $1.44, a year earlier.
Before the payment of preferred stock dividends, profit fell 68 percent to $51.2 million. M&T took $600 million from the government's Troubled Asset Relief Program.
Excluding one-time items, M&T said operating profit was 79 cents per share. Analysts on average expected 56 cents per share, according to Reuters Estimates.
Chief Financial Officer Rene Jones said results benefited from a wider lending margin, strong mortgage banking activity, and higher fees and deposit service charges.
Operating results benefited from the May acquisition of Baltimore-based Provident Bankshares Corp, which added about $6 billion of assets and helped M&T expand in the mid-Atlantic.
Results included per-share charges of 13 cents for securities writedowns, 17 cents to replenish a federal deposit insurance fund, and 35 cents related to Provident.
M&T has fared better than most rivals in navigating the nation's credit crisis, though it has set aside less money for bad loans, relative to nonperforming assets, than some peers.
In the second quarter, M&T set aside $147 million for credit losses, up from $100 million a year earlier. Net charge-offs rose to $138 million from $99 million, largely because of a single troubled commercial loan.
M&T, which operates more than 800 branches in seven mid-Atlantic states and the District of Columbia, ended June with an $855 million reserve for credit losses, $1.2 billion of nonperforming assets, and $69.9 billion of assets.
Berkshire ended March with a 6 percent stake in M&T Bank, according to Thomson ShareWatch.
M&T shares closed Friday at $54.44 on the New York Stock Exchange. Through Friday, the shares had fallen 5 percent this year, compared with a 16 percent decline in the KBW Bank Index .
(Reporting by Jonathan Stempel; editing by John Wallace) Keywords: MTBANK/
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