M&T Bank, in which AIB has a 24% stake, said today that its second-quarter profit fell by 25%, hurt by credit losses tied to residential property.
Net income for the Buffalo, New York-based company, whose largest investors also include Warren Buffett's Berkshire Hathaway, fell to $160.3m, or $1.44 a share, from $214.2m, or $1.95, the same time last year.
M&T said operating earnings fell 24% to $170.4m, or $1.53 a share. Analysts on average forecast profit of $1.50 a share. M&T set aside $100m for credit losses, up from $30m a year earlier, while net charge-offs increased to $99m from $22m.
The bank said this reflected declining residential property valuations, making it harder for homeowners, builders and developers to repay loans. Total non-performing loans doubled from a year earlier to $587.4m.
'M&T is not immune to the effects of the higher credit costs evident throughout the banking industry,' Chief Financial Officer Rene Jones said.
M&T said its results benefited from a 14% increase in average loans and leases to $49.5 billion.
The bank's shares have fallen 15% this year so far.
