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Meet the Management. Meet the Management. Donal Forde AIB Bank RoI. Eugene Sheehy C.E.O. John O’Donnell Group Financial Director. Robbie Henneberry AIB Bank UK. Colm Doherty AIB Capital Markets. Gerry Byrne AIB Poland. Steve Meadows Operations & Technology. Rene Jones CFO, M&T.

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Meet the management

Meet the Management


Meet the management1

Meet the Management

Donal Forde

AIB Bank RoI

Eugene Sheehy

C.E.O.

John O’Donnell

Group Financial Director

Robbie Henneberry

AIB Bank UK

Colm Doherty

AIB Capital Markets

Gerry Byrne

AIB Poland

Steve Meadows

Operations & Technology

Rene Jones

CFO, M&T


Meet the management

Meet the Management


Donal forde managing director aib bank republic of ireland

Donal Forde

Managing Director - AIB Bank Republic of Ireland


Forward looking statements

Forward Looking Statements

A number of statements we will be making in our presentation and in the accompanying slides will not be based on historical fact, but will be “forward-looking” statements within the meaning of the United States Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those projected in the forward looking statements. Factors that could cause actual results to differ materially from those in the forward looking statements include, but are not limited to, global, national and regional economic conditions, levels of market interest rates, credit or other risks of lending and investment activities, competitive and regulatory factors and technology change.Any‘forward-looking statements made by or on behalf of the Group speak only as of the date they are made.

visit www.aibgroup.com/investorrelations


Meet the management

2006

Positive environment

+

Our prime competitive position

On course for strong full year profit performance


Meet the management

2007 – 2010

Our medium term view


Positive economic environment to continue

Positive economic environment to continue

  • Favourable demographics - inward migration driving strong population growth

  • Housing market supported by strong demand

  • Strong public finances - potential for increased government spending

  • Savings ratio remains high - latent investment and consumption potential

  • Interest rate levels still relatively accommodating

  • Inflation to fall below 3% by end 2007, 2-3% range thereafter

GDP growth of 5 - 6% in 2007, gentle moderation thereafter


Competitive threats are manageable

Competitive threats are manageable

Business Market - Threat from established Players

  • AIB standing as primary Business Bank

  • Relationship-based market

  • Confident of sustaining our leadership position - recent momentum reinforces that confidence

    Retail Market -Threat from New Players (Den Danske / HBOS / Fortis)

  • AIB underweight in many Retail product lines

  • Less “incumbent” mindset - more attacking posture

  • Focus on Personal Deposits, Consumer Lending, Life & Pensions, General Insurance & Mortgages

Market repositioning in 2006 as early execution of this strategy


Upgrading distribution and operations capability

Upgrading distribution and operations capability

  • Branch channel

    • More radical centralisation of support / administration / account maintenance / telephony / credit management

    • Heavy promotion of self-service / assisted-service banking

    • Targeting 25% increase in relationship management / sales capacity

    • Focused on business / premium-personal customers

  • Internet & telephone channels

    • Accelerated internet recruitment Centralised telephony

    • Channel-exclusive product and price propositions & stronger sales focus

  • Extending our distribution network

    • Hibernian relationship / AA alliance

    • Mortgage intermediaries

  • Significant technology investments

    • New banking platform

    • New data centres

    • New core banking system

Driving sales momentum, cost efficiency and service differentiation


Focus on wealth management

Focus on wealth management

  • High growth potential

  • Close gap in market share v natural share of client relationships

  • Actions / initiatives

    • JV product suite targeted at base / centre of customer pyramid

    • Revitalised AIB wealth proposition targeted at emerging wealth / top of customer pyramid

    • Integrated distribution team / substantial investment in technology, training and performance oversight

    • Q3 performance very encouraging

Targeting €100m increase in profit by 2010


2007 2010 what you can expect from us

2007 – 2010: what you can expect from us

  • Irish market loan and deposit growth to be significantly ahead of European peers

  • AIB targeting above market growth in both loans & deposits

  • Significant market share gains in investment sales, pensions & general insurance

  • Product margins

    • Improving in deposits

    • Stabilising in business and consumer lending

    • Mortgages reducing to c. 80 bps

  • Costs

    • Current core cost growth is 6 – 7%

    • Investment to sustain growth will add to this level

    • New pay structure increases variability

    • Over-riding discipline is positive jaws target of 3%

  • Asset quality

    • Confidence underpinned by economy, demographics and underwriting stance

Superior growth / productivity in outperforming market


In summary

In summary

2006

  • On course for strong performance

    2007 - 2010

  • “Ireland Inc.” to outperform European peers

  • AIB- sustaining its no.1 position in business market

    - attacking underweight retail lines

  • Investing in improved distribution, upgraded operations and wealth management

  • Confident that we will continue to outperform

Continuing double digit profit growth


Robbie henneberry managing director aib group uk p l c

Robbie Henneberry

Managing Director – AIB Group (UK) p.l.c.


Forward looking statements1

Forward looking statements

A number of statements we will be making in our presentation and in the accompanying slides will not be based on historical fact, but will be “forward-looking” statements within the meaning of the United States Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those projected in the forward looking statements. Factors that could cause actual results to differ materially from those in the forward looking statements include, but are not limited to, global, national and regional economic conditions, levels of market interest rates, credit or other risks of lending and investment activities, competitive and regulatory factors and technology change.Any‘forward-looking’ statements made by or on behalf of the Group speak only as of the date they are made.

visit www.aibgroup.com/investorrelations


Uk division a snapshot

UK Division - a snapshot

  • UK regulated & incorporated since 1996

  • Trades as:

  • In GB - business banking

  • In NI - retail & business banking

  • 15% of group profits

  • 3,000 staff, 550,000 customers

  • £13bn loans, £8bn deposits

  • Business origination through 4 units: GB, FTB, mid-corporate, wealth management

Allied Irish Bank (GB)

First Trust Bank (FTB)


Meet the management

Strong track record

PBT CAGR 12.1%

Loans CAGR 21.0% Deposits CAGR 14.4%

Cost / Income ratio

Impaired Loans

% of Average Loans


Aib gb great britain

AIB (GB) – Great Britain

PBT CAGR 15.5%

£’m

  • 32 full service branches & 12 business development offices

  • Full relationship management service to businesses in selected sectors & connected personal customers

  • Targeting relatively resilient sectors, avoiding adverse selection

  • Continued migration from small to higher value mid market business banking

  • Distinctive customer proposition built on quality of people, customer relationship & speed of decision making


First trust bank northern ireland

First Trust Bank – Northern Ireland

CAGR 8.9%

£’m

  • 56 full service branches providing retail banking services to personal and business customers

  • Good performance in a lower growth environment (NI GDP 2.2%) notably in business banking and home mortgages

  • Reinvigorating revenue streams with refreshed proposition – new mortgages, personal loan & deposits launched - new personal current account in progress

  • Continued focus on efficiency and cost management


Mid corporate banking

Mid-Corporate Banking

Regional Teams

  • Established in London, Birmingham, Manchester, Leeds, Glasgow & Belfast - loans £2.5bn

  • Focused on healthcare, leisure industry, horse racing, hotels and environmental services

  • ‘Bank of choice’ in chosen high potential segments

    Public Sector & Charities

  • Established reputation and market share in education, social housing, publicly funded healthcare, PFI & structured finance

    Property Finance Unit

  • New business initiative - phased build-up since January 2006

  • Develop existing relationships to build a high return portfolio of leveraged property transactions for established operators


Wealth management

Wealth management

Private Banking

  • Established presence in London & Belfast, capability now in Birmingham, Manchester & Edinburgh

  • Full relationship management service to HNW segment connected to business customers

  • Developing proposition with wider range of investment, protection & pension products/services

    Regulated Sales

  • 45 IFAs throughout the branch network in GB and NI

  • Sales momentum building with increased referrals from the network

  • Developing lower cost delivery channel for mass market in Northern Ireland with retention of IFAs for HNW segment

  • Efficiency improvements through a combination of outsourcing & improved use of IT


Investing in the franchise

Investing in the franchise

Over the last 12 months:

People

  • Corporate Banking increased by 30%

  • Wealth Management increased by 25%

  • 171 staff promotions

    Property

  • 6 major refurbishments/relocations

    IT

  • New banking platform installed in branch network

  • Improved online and payments functionality

    Regulation

  • Enhanced risk & control framework


Key priorities

Key priorities

  • Recruitment, integration & retention of best people

    • Quality rather than quantity bias

  • Diversification of income streams and delivery channels

    • Mid-corporate & wealth management

    • Direct channel

    • Treasury & cash management

  • Enhanced focus on deepening relationships

    • Investing in scope not scale

    • Increasing share of chosen mid market sectors

  • Branch reconfiguration

    • Removal of non-core activities to ‘centres of excellence’

    • Simplification and standardisation of operations

    • Leverage of synergies across the AIB enterprise


Uk division what to expect 2006 2010

UK Division: what to expect 2006-2010

  • Recognised by our customers as their bank of choice

    • Providing a full service value for money proposition

    • Delivered by top quality people through customer chosen channel

  • Targeting continuation of

    • 3% income / cost gap, further driving down cost / income ratio

    • Strong asset quality; current environment particularly benign

    • Double digit profit growth


Gerry byrne managing director aib poland division

Gerry Byrne

Managing Director - AIB Poland Division


Forward looking statements2

Forward looking statements

A number of statements we will be making in our presentation and in the accompanying slides will not be based on historical fact, but will be “forward-looking” statements within the meaning of the United States Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those projected in the forward looking statements. Factors that could cause actual results to differ materially from those in the forward looking statements include, but are not limited to, global, national and regional economic conditions, levels of market interest rates, credit or other risks of lending and investment activities, competitive and regulatory factors and technology change.Any‘forward-looking statements made by or on behalf of the Group speak only as of the date they are made.

visit www.aibgroup.com/investorrelations


Why is aib in poland

Why is AIB in Poland ?

  • Large Market – 39m people with considerable employment potential

  • GDP per capita is 46% versus EU15

  • One of the fastest growing economies, GDP now growing at c. 5%

  • Total banking assets / GDP at 68% (EU15 203%)

  • Only 60% of the population have bank accounts

  • Branch coverage at 50% of EU average

  • Excellent cultural fit


Banking environment 1995 2005

Banking environment (1995 – 2005)


Our 5 year performance

H1, 2006

571

H1, 2006

Our 5 year performance

Bank Zachodni WBK S.A. - 2001 to H1, 2006

PBT CAGR + 50%

Loans CAGR 9% / Deposits + Funds CAGR 14.5%

PLN m

PLN bn

800

690

700

570

600

500

388

400

260

300

200

122

100

0

2001

2002

2003

2004

2005

  • People employed  from 10.2k to 7.8k

  • Cost / income ratio  from 80% to 52%

  • Impaired loans  from 20% to 6%


Evolution of income costs carefully chosen growth

Loan Interest Income

exceeds

Deposit Interest Income

Evolution of income & costs – carefully chosen growth


Reshaping our business continuous improvement

GDANSK

SZCZECIN

WARSAW

POZNAN

LODZ

WROCLAW

KATOWICE

KRAKOW

Reshaping our business – continuous improvement

  • Branches

  • 372 branches, 605 ATMs

  • 30 new branches planned for 2007

  • Expansion in key markets

Corporate Business Centres

  • Large commercial & corporate focus

  • Warsaw, Poznan, Wroclaw, Krakow, Gdansk

  • 65% total loans under CBC mgt.

  • 3 New Locations in 2007 – Katowice / Szczecin / Lodz

External Channels

  • Direct banking

  • Intermediaries

  • Mobile sales


Our reshaped business reaping the rewards

Our reshaped business – reaping the rewards

Profit & Loss

  • Total Operating Income + 26%

  • Operating Expenses + 9%

  • Provisions- 2%

  • Profit before Tax + 62%

H1 2006 v H1 2005

Balance Sheet / Products

  • Corporate / SME + 10%

  • PLN Mortgages+ 23%

  • Personal Loans+ 93%

  • Leasing+ 16%

  • Mutual Funds+ 230%

  • Deposit Volumes+ 7%

  • E Banking/Payments+ 13%

2006 profits: expected to be materially greater than 2005


Our reshaped business developing our market position

Our reshaped business – developing our market position

  • Number 1 for asset quality with c. 6% impaired loans

  • Number 1 for investment performance / number 2 in investment funds

  • Number 1 in stockbroking

  • Business loan growth 2x market level

  • Top 3 ROE performance

  • Number 2 for % gap between income and cost growth

Peer benchmarking in 2006


Positive e conomic growth indicators

Positive economic growth indicators


Targeting outperformance in a high growth market 2006 2010

Targeting outperformance in a high growth market 2006 - 2010

  • High quality well spread sources of income

    • Strong momentum in business / retail loans, deposits / investment funds, leasing, brokerage & credit cards

  • Further efficiency gains enabled by highly scaleable platform

  • Risk firmly managed by top class people, scoring and decision engines


5 years to 2010 what you can expect from us

5 years to 2010 - what you can expect from us

  • Maintenance of material income / cost gap

  • Further % reduction in level of impaired loans

  • ROIC to continue increasing from the current 25%

Primed to continue significant, well balanced growth


Colm doherty managing director aib capital markets

Colm Doherty

Managing Director - AIB Capital Markets


Forward looking statements3

Forward looking statements

A number of statements we will be making in our presentation and in the accompanying slides will not be based on historical fact, but will be “forward-looking” statements within the meaning of the United States Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those projected in the forward looking statements. Factors that could cause actual results to differ materially from those in the forward looking statements include, but are not limited to, global, national and regional economic conditions, levels of market interest rates, credit or other risks of lending and investment activities, competitive and regulatory factors and technology change.Any‘forward-looking statements made by or on behalf of the Group speak only as of the date they are made.

visit www.aibgroup.com/investorrelations


Capital markets comprises 3 business divisions

Profit Before Tax

403m

Profit Before Tax

CAGR 21%

317m

301m

258m

237.8m

200.5m

155.6m

2000

2001

2002

2003

2004

2005

1H

2006*

*excludes 25m gain on sale of business

Capital Markets comprises 3 business divisions

Strong, Recurring, Skills based

  • Customer oriented 87/13

  • Good Earnings Mix

  • Domestic dominance … but decreasing importance

  • International expansion around proven sector specialisms

  • Best in class enablement / risk architecture

  • Rigorous cost focus - C/I ratio 43%

  • Solid Returns - ROE 20%

Normalised Pre Tax Profit

  • Corporate Banking 63%

  • Global Treasury27%

  • Investment Banking 10%

Interest Income :52%

Fee Income:35%

Trading Income:13%


Corporate banking strong recurring earnings

Corporate Banking - strong recurring earnings

  • PBT 2000-2005 : CAGR 27%

  • Consistent 20% + growth in profit pre provision

  • Good spread on earnings / volume mix 

  • 155bps average portfolio margin

  • Weighted average credit grade of portfolio is constant

  • RWA: €25 billion

  • ROE: 21%

  • Leading domestic Corporate Bank

    • 40% Corporate Clearing Accounts

  • International expansion based on sector specialisms

  • Premium for sector knowledge and ability to manage complexity

  • Rigid ROE discipline


Corporate banking best in class credit risk management

Corporate Banking - best in class credit risk management

  • Selective Credit Underwriting

    • Centralised credit platform / sector specific best practice models

  • Diversified Portfolio

    • Advanced portfolio modelling / limit setting framework

  • Credit grading

    • Robust methodology, empirically validated, rating agency endorsed.

  • Credit structuring

    • Emphasis on repayment sensitivity, covenants, collateral

  • Pricing

    • Strong ROE discipline - value not volume. €3bn asset shed from portfolio in 2006

  • Dynamic provisioning

    • All active impaired loans paying current interest

    • Improving impaired loans trend

  • Exceptional experience on default v’s model EL


Corporate banking growth drivers

Corporate Banking - growth drivers

  • Clear Strategy

    • Regional ‘Relationship Bank’ in Ireland

    • Specialist lender in chosen niches elsewhere

    • Structuring complexity yields a better price

    • Developing debt fund management capability

  • Geographic expansion - the model travels well

    • Australasia

    • Canada

  • The credit cycle - benign or tough presents opportunity

Corporate Banking …….. Diverse…….Highly Profitable ………Sustainable


Global treasury strong recurring earnings

Global Treasury- strong recurring earnings

  • PBT 2000-2005: CAGR 24%

  • Customer income 56% revenues*

    • 40% share domestic market

    • Strong Polish franchise

  • Trading income 44% revenues

    • short term trading

    • credit related trading

    • strategic trading

  • Consistent profits at all points in interest rate cycle

  • Average daily VAR €13 million

  • Best in class enablement / risk architecture

  • RWA €10 billion (€7 billion excluding liquidity assets)

  • ROE 27%

*pre internal distribution


Global treasury growth drivers

Global Treasury- growth drivers

Treasury Services

  • Buoyant local economies (Ireland / Poland) underpin demand

  • Scope for increased product penetration

  • Leverage UK small company relationships more effectively

  • Cost efficiencies from technology platform

    Trading

  • Capacity to put more risk to work

Treasury …Customer Driven……Low Risk Trading …Consistent Earnings


Investment banking

Investment Banking

  • Substantially Irish based business

    • Stockbroking; asset management; M&A; structured finance services

    • Low % of profits, higher volatility: 2000-2005 CAGR 0% (very strong base year)

      No. 1 in M&A; structured finance services

      No. 2 in stockbroking

      No. 3 in asset management

  • Divested 50% interest in AIB/BNY JV

  • Sold retail funds to Aviva as part of Ark Life transaction

  • Growth drivers

    • Increasing demand for Private Client Wealth Management Services

    • Demand for M&A services robust

    • Continued economic buoyancy / positive equity market returns. Will support demand for investment products / services


Conclusion

Conclusion

  • Resilient high performing business positioned for sustainable growth

    • Increasing flexibility to diversify income streams

    • Strong focus on productivity, significant income / cost gap

    • Sophisticated and resilient risk management framework

  • Uninterrupted profit growth record will continue


Steve meadows group director operations technology

Steve Meadows

Group Director, Operations & Technology


Forward looking statements4

Forward looking statements

A number of statements we will be making in our presentation and in the accompanying slides will not be based on historical fact, but will be “forward-looking” statements within the meaning of the United States Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those projected in the forward looking statements. Factors that could cause actual results to differ materially from those in the forward looking statements include, but are not limited to, global, national and regional economic conditions, levels of market interest rates, credit or other risks of lending and investment activities, competitive and regulatory factors and technology change.Any‘forward-looking statements made by or on behalf of the Group speak only as of the date they are made.

visit www.aibgroup.com/investorrelations


O t formed to change aib s operating model

AIB Group excl O&T

O&T

O&T formed to change AIB’s operating model

Pre-Oct ’05

O&T functions dispersed and fragmented across operating divisions

O&T scope today

People

Costs

2006

16%

16%

3,786

€372m

20,240

€1,873m

84%

84%

  • How our people are deployed

  • Back office operations2,124

  • Technology1,266

  • Enterprise support396


Operations technology o t

Operations & Technology (O&T)

A key enabler of our enterprise agenda

  • Building an environment, framework and model to sustain a positive gap between income and cost growth


O t strategy 3 components

O&T strategy – 3 components

DeliveringOperational Excellence

Transformingthe Business Operating Model

Enabling the enlarged Enterprise

Service Quality

Operational

Excellence

Managed

Cost

Risk

2005

2009

  • End game objectives

  • Rapid speed to market

  • Volume growth cost indifference

  • Support business volume growth

  • Business acquisition capability


O t investment programme a 400m commitment

O&T investment programme - a €400m commitment

Practical first steps

Datacentre Relocation

One Network (VoIP)

XP Desktops

Infrastructure upgrades

Transforming

to support future growth

Operating model consolidation

Wholesale Core Banking

Retail Core Banking

Credit decision and support

Regulatory agenda

Basel II

SOX

SEPA

EU Savings directive

Anti Money Laundering

Consumer Credit Act

Complaints Management


Driving quality risk and cost benefits

DeliveringOperational Excellence

Driving quality, risk and cost benefits

  • Key Initiatives

  • Right first time

  • Total Quality Management (TQM)

  • Automation tools

  • Elimination of redundant activities

  • ABC unit cost management

  • Objectives

  • Service delivery cycle times down by 40%

  • Error rates / rework down 35%+

  • Reduced unit production costs

  • Controls framework embedded in production operations


Investing to transform our business

Transformingthe Business Operating Model

Investing to transform our business

  • Objectives

  • Retirement of 20+ legacy systems

  • Core systems TCO reduction

  • Further unit processing cost reduction

  • Key Initiatives

  • Core banking systems renewal

  • Legacy systems retirement

  • Utilisation of best-in-class offshore developed systems


Developing a standard operating model

Enabling the enlarged Enterprise

Developing a standard operating model

  • Key Initiatives

  • Standard ‘1-Way’ operating model

  • Fully aligned business operating model deployment

  • Production centre consolidation

  • Common IT infrastructure deployment

  • Objectives

  • Rapid speed to market

  • Volume growth cost indifference

  • Support business volume growth

  • Business acquisition capability


O t summary

O&T summary

DeliveringOperational Excellence

Transformingthe Business Operating Model

Enabling the enlarged Enterprise

Service Quality

Operational

Excellence

Managed

Cost

Risk

2005

2009

  • Underpinning our productivity drive

    • Ensuring we can maintain a gap ≥ 3% between income and cost growth


Ren jones chief financial officer m t bank corporation

René Jones

Chief Financial Officer - M&T Bank Corporation


Forward looking statements5

Forward looking statements

A number of statements we will be making in our presentation and in the accompanying slides will not be based on historical fact, but will be “forward-looking” statements within the meaning of the United States Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those projected in the forward looking statements. Factors that could cause actual results to differ materially from those in the forward looking statements include, but are not limited to, global, national and regional economic conditions, levels of market interest rates, credit or other risks of lending and investment activities, competitive and regulatory factors and technology change.Any‘forward-looking statements made by or on behalf of the Group speak only as of the date they are made.

visit www.aibgroup.com/investorrelations


M t a name known in buffalo since 1856

M&T - A name known in Buffalo since 1856

  • One of the 20 Largest U.S. Banks

  • $13.5 Billion Market Cap

  • $56.4 Billion in assets

  • +670 branches in 6 States and the District

  • of Columbia

  • Serving customers in 2 million households

  • and +150,000 businesses

  • +13,500 employees

  • +1,500 ATM’s


Environment for us banks

Environment for US banks

Best of times

  • Many US Bank stocks near all-time highs

    • “Own banks when short term interest rates peak”

  • Benign credit environment

    Worst of times

  • NIM pressure – subdued revenue growth

    • Revenue growth for top 50 US banks 2Q05 – 2Q06 – 6%

  • EPS growth below long term average

    • EPS growth for top 50 US banks 2Q05 – 2Q06 – 5%

  • Slowdown in housing market


M t reaction to current environment

M&T reaction to current environment

  • Seeing same slower revenue growth as the industry

    • Significant variability among geographic regions

  • Closely managing expenses in response

    • Maintain positive operating leverage

    • Allocate resources toward fastest growing businesses/geographies

  • Maintaining standards for credit quality and returns

    • Excellent credit results


M t bank corporation earnings per share summary

M&T Bank Corporation - Earnings Per Share Summary

($ in millions)

(1) Excludes merger-related costs and amortization expense associated with intangible assets.

*Intangible Amortization net of tax: Sept. 2005 YTD =$27MM, Sept. 2006 YTD = $27MM Merger-related costs net of tax: Sept. 2006 YTD = $3MM


M t bank corporation nine month highlights

M&T Bank Corporation – nine month highlights

  • Revenue growth of 4.7% year-over-year

  • Average loans & leases grew 4.7%

  • NIM declined to 3.69% from 3.79%

  • Operating expenses up 2.7%*

  • Net charge-offs of $43 million, down $11 million from 2005

* Excluding $18MM donation to the M&T Charitable Foundation.


Meet the management

M&T Corporation vs. Top 50

Note: Efficiency ratio excludes amortization expense associated with intangible assets, merger-related expenses, and G/L on investment securities.

*MTB’s efficiency ratio excludes the $25 million pretax contribution to The M&T Charitable Foundation.

** MTB’s efficiency ratio excludes the $18 million pretax contribution to The M&T Charitable Foundation and $13 million gain on an FHLB borrowing.


M t bank corporation pretax operating income by region

(1) Includes Upstate NY and Western NY regions.

(2) Includes NYC, Philadelphia, and Tarrytown regions.

(3) Includes Baltimore, Washington DC, and Chesapeake regions.

(4) Includes Pennsylvania, less Philadelphia.

Note: Operating Income excludes amortization of intangibles, merger-related expenses and non-recurring items.

M&T Bank Corporation – pretax operating income by region

($ in millions)


M t per share data 1983 2005

M&T per share data 1983-2005

$7.03

+22% CAGR

+18% CAGR

Note: Data prior to 1998 does not include provisions of SFAS No. 123 andNo.148 stock option expensing.


Recent performance

Recent performance

Note: Reflects stock price performance through Sept 30. 2006

(1) BKX indicates the KBW Bank Index.


What makes m t unique

What makes M&T unique?*

Other

Shareholders

  • Management’s interest aligned with Shareholders’ Interests

  • Over 50% Ownership between AIB, M&T insiders and Warren Buffett

AIB

M&T

Management,

Directors and

Employees

Berkshire

Hathaway-

Warren

Buffett

* As of 2/28/06. Includes options & deferred bonus shares


Meet the management

M&T Bank Corporation… a solid investment

Source: IDC & Factset

  • 24.6% Annual rate of return since 1980

    • 13th best return of the entire universe of over a thousand U.S. based stocks that have traded publicly since 1980

      $2,790 invested in M&T in 1980 would be worth $1 million today

Note: CAGR calculated assuming reinvestment of dividends through September 30, 2006.


Meet the management

Appendix


Reconciliation of gaap and non gaap results of operation

Reconciliation of GAAP and Non-GAAP Results of Operation


Reconciliation of assets equity to tangible assets equity

Reconciliation of Assets & Equity to Tangible Assets & Equity


John o donnell group financial director

John O’Donnell

Group Financial Director


Forward looking statements6

Forward Looking Statements

A number of statements we will be making in our presentation and in the accompanying slides will not be based on historical fact, but will be “forward-looking” statements within the meaning of the United States Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those projected in the forward looking statements. Factors that could cause actual results to differ materially from those in the forward looking statements include, but are not limited to, global, national and regional economic conditions, levels of market interest rates, credit or other risks of lending and investment activities, competitive and regulatory factors and technology change.Any‘forward-looking statements made by or on behalf of the Group speak only as of the date they are made.

visit www.aibgroup.com/investorrelations


Some topical themes

Some topical themes

  • Capital allocation and management

  • Funding

  • Net interest margin


Capital allocation

Capital allocation

  • Allocation to support organic growth our priority

    • Best value creator

    • Plentiful supply for business exceeding benchmark return

  • Business divisions as mini plcs, individual EPS assessment

  • Primary focus on return on regulatory capital; supported and complemented by return on economic capital

    • Detailed appraisal of return on incremental capital

  • Basel II - conservative view of quantum and timing of benefits


Capital outlook

Capital outlook

Assumptions

ROE 20%

40%Div payout (8%)

12%

25% Leverage3%

15%

15% Internal

Capital

Generation Rate

2 year visibility on capital

(Target tier 1 7%)

Management

Actions

Asset sales & leasebacks

Recourse to shareholders not on agenda

Securitisation, other assets

Further Options


Source of funds

Source of funds

%

10%

10%

4%

6%

3%

10%

7%

24%

25%

49%

52%


Debt funding well distributed and diversified

Debt funding – well distributed and diversified

Debt Distribution October 2006

€ (m)

Euro 82%

STG 14%

US$ 4%

Step-up issues – adjustedto earliest step-up date


Net interest margin loans growing faster than deposits

Net interest margin – loans growing faster than deposits

%


Net interest margin re investment of customer account funds

Net interest margin - re-investment of customer account funds

  • Objective to reduce income volatility

  • Average maturity c. 3.5 years

  • October re-investment tranche positive; breaking long negative sequence

  • Lesser negative in 2007, turning positive in 2008


Net interest margin mix and competition

Net interest marginMix and competition

  • Business mix (Republic of Ireland)

Branch loans3214116

Home loans29313433

Market / other loans39555561

Total loans100100100100

199820022003June 2006

% of loan book% of loan book% of loan book% of loan book

  • Margin on branch loans up to 4% higher than other loan categories

    • No material ongoing front book / back book issue

  • Relative growth in other products also has mix effect e.g. corporate loans, term deposits

  • Competition expected to remain strong

    • Product margins resilient


Financial snapshot

Financial snapshot

  • All businesses performing strongly and generating good returns

  • Income momentum underpinned by buoyant and well spread pipelines

  • Investing to sustain growth and maintaining significant positive income / cost growth gap

  • Asset quality remains very solid

  • Growth built on robust capital and funding foundations

Well set to continue high quality growth


Contacts

+353-1-660 0311

+353-1-641 2075

Contacts

Our Group Investor Relations Department will be happy to facilitate your requests for any further information

Alan [email protected]+353-1-6412162

Maurice [email protected] +353-1-6414191

Pat [email protected] +353-1-6412381

Alma [email protected]+353-1-6413469

Visit our website www.aibgroup.com/investorrelations


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