Loans and Leases

12 Months Ended

Dec. 31, 2022

4. Loans and leases

Total loans and leases outstanding were comprised of the following:


	December 31
	2022			2021
	(In thousands)
Loans
Commercial, financial, etc.	$	39,695,189		$	22,524,542
Commercial real estate		45,444,010			35,473,884
Residential real estate		23,773,842			16,077,275
Consumer		20,579,263			17,964,331
Total loans		129,492,304			92,040,032
Leases
Commercial		2,581,852			1,096,646
Total loans and leases		132,074,156			93,136,678
Less: unearned discount		(509,993	)		(224,226	)
Total loans and leases, net of unearned discount	$	131,564,163		$	92,912,452

One-to-four family residential mortgage loans held for sale were $32 million at December 31, 2022 and $474 million at December 31, 2021. Commercial real estate loans held for sale were $131 million at December 31, 2022 and $425 million at December 31, 2021.

The amount of foreclosed property held by the Company, predominantly consisting of residential real estate, was $41 million and $24 million at December 31, 2022 and 2021, respectively. There were $201 million and $151 million at December 31, 2022 and 2021, respectively, in loans secured by residential real estate that were in the process of foreclosure. Of all loans in the process of foreclosure at December 31, 2022, approximately 42% were government guaranteed.

Borrowings by directors and certain officers of M&T and its banking subsidiaries, and by associates of such persons, exclusive of loans aggregating less than $60,000, amounted to $102 million and $113 million at December 31, 2022 and 2021, respectively. During 2022, new borrowings by such persons amounted to $7 million (including any borrowings of new directors or officers that were outstanding at the time of their election) and repayments and other reductions (including reductions resulting from individuals ceasing to be directors or officers) were $18 million.

At December 31, 2022, approximately $10.5 billion of commercial loans and leases, $16.3 billion of commercial real estate loans, $19.5 billion of one-to-four family residential real estate loans, $2.4 billion of home equity loans and lines of credit and $10.7 billion of other consumer loans were pledged to secure outstanding borrowings and available lines of credit from the FHLB and the Federal Reserve Bank of New York as described in note 9.

A summary of current, past due and nonaccrual loans as of December 31, 2022 and 2021 follows:


	Current		30-89 Days Past Due		Accruing Loans Past Due 90 Days or More		Nonaccrual		Total
	(In thousands)
December 31, 2022
Commercial, financial, leasing, etc.	$	40,982,398	$	448,462	$	72,502	$	347,204	$	41,850,566
Real estate:
Commercial		34,972,627		311,188		67,696		1,396,662		36,748,173
Residential builder and developer		1,304,798		8,703		—		1,229		1,314,730
Other commercial construction		6,936,661		239,521		549		124,937		7,301,668
Residential		21,491,506		595,897		345,402		272,090		22,704,895
Residential — limited documentation		950,782		22,456		—		77,814		1,051,052
Consumer:
Home equity lines and loans		4,891,311		30,787		—		84,788		5,006,886
Recreational finance		8,974,171		54,593		—		44,630		9,073,394
Automobile		4,393,206		44,486		—		39,584		4,477,276
Other		1,958,196		22,961		4,869		49,497		2,035,523
Total	$	126,855,656	$	1,779,054	$	491,018	$	2,438,435	$	131,564,163

December 31, 2021
Commercial, financial, leasing, etc.	$	23,101,810	$	142,208	$	8,284	$	221,022	$	23,473,324
Real estate:
Commercial		24,712,643		319,099		31,733		1,069,280		26,132,755
Residential builder and developer		1,400,437		2,904		—		3,005		1,406,346
Other commercial construction		7,722,049		17,175		—		111,405		7,850,629
Residential		13,294,872		239,561		920,080		355,858		14,810,371
Residential — limited documentation		1,124,520		16,666		—		122,888		1,264,074
Consumer:
Home equity lines and loans		3,476,617		15,486		—		70,488		3,562,591
Recreational finance		7,985,173		40,544		—		27,811		8,053,528
Automobile		4,604,772		40,064		—		34,037		4,678,873
Other		1,620,147		12,223		3,302		44,289		1,679,961
Total	$	89,043,040	$	845,930	$	963,399	$	2,060,083	$	92,912,452

At December 31, 2022 and 2021, the Company had $19 million and $1.2 billion, respectively, of outstanding loan balances, consisting predominantly of residential real estate loans, for which COVID-19 related payment deferrals were granted. Those loans meet the criteria described in note 1 and, as such, are not considered past due or otherwise in default of loan terms as of the dates presented. Included in those loan balances were $8 million and $974 million of government-guaranteed loans at December 31, 2022 and 2021, respectively.

During the normal course of business, the Company modifies loans to maximize recovery efforts. If the borrower is experiencing financial difficulty and a concession is granted, the Company considers

such modifications as troubled debt restructurings and classifies those loans as either nonaccrual loans or renegotiated loans. The types of concessions that the Company grants typically include principal deferrals and interest rate concessions, but may also include other types of concessions.

The tables that follow summarize the Company’s loan modification activities that were considered troubled debt restructurings for the years ended December 31, 2022, 2021 and 2020:


					Post-modification (a)
Year Ended December 31, 2022	Number		Pre- modification Recorded Investment		Principal Deferral		Interest Rate Reduction		Other		Combination of Concession Types		Total
	(Dollars in thousands)

Commercial, financial, leasing, etc.		193	$	87,873	$	53,219	$	455	$	983	$	34,791		89,448
Real estate:
Commercial		50		34,972		14,037		—		2,223		18,358		34,618
Residential builder and developer		1		60		57		—		—		—		57
Other commercial construction		1		100		—		—		—		100		100
Residential		274		71,165		54,519		—		—		19,022		73,541
Residential — limited documentation		8		1,398		1,216		—		—		193		1,409
Consumer:
Home equity lines and loans		144		10,146		9,372		—		—		841		10,213
Recreational finance		729		27,517		27,510		—		—		—		27,510
Automobile		2,092		41,540		41,510		—		—		—		41,510
Other		149		1,426		1,426		—		—		—		1,426
Total		3,641	$	276,197	$	202,866	$	455	$	3,206	$	73,305	$	279,832

Year Ended December 31, 2021

Commercial, financial, leasing, etc.		284	$	185,458	$	46,806	$	—	$	40,558	$	95,516	$	182,880
Real estate:
Commercial		99		202,878		67,387		—		31,202		102,248		200,837
Residential builder and developer		1		3		3		—		—		—		3
Other commercial construction		3		542		532		—		—		—		532
Residential		373		108,325		95,769		—		—		12,866		108,635
Residential — limited documentation		21		2,920		2,865		—		—		—		2,865
Consumer:
Home equity lines and loans		89		6,430		6,054		—		—		321		6,375
Recreational finance		281		9,931		9,931		—		—		—		9,931
Automobile		807		14,668		14,654		—		—		14		14,668
Other		362		2,597		2,597		—		—		—		2,597
Total		2,320	$	533,752	$	246,598	$	—	$	71,760	$	210,965	$	529,323

Year Ended December 31, 2020

Commercial, financial, leasing, etc.		394	$	246,479	$	70,671	$	298	$	31,605	$	97,344	$	199,918
Real estate:
Commercial		161		310,578		204,591		505		4,874		85,261		295,231
Residential builder and developer		1		91		—		—		—		90		90
Other commercial construction		2		13,602		13,573		—		—		—		13,573
Residential		631		202,985		183,878		—		—		23,639		207,517
Residential — limited documentation		30		7,413		7,100		—		—		1,232		8,332
Consumer:
Home equity lines and loans		259		17,228		5,882		—		—		11,372		17,254
Recreational finance		428		16,392		16,388		—		—		4		16,392
Automobile		2,249		39,951		39,949		—		—		2		39,951
Other		1,095		7,788		3,383		—		—		4,405		7,788
Total		5,250	$	862,507	$	545,415	$	803	$	36,479	$	223,349	$	806,046

(a)

Financial effects impacting the recorded investment included principal payments or advances, charge-offs and capitalized escrow arrearages. The present value of interest rate concessions, discounted at the effective rate of the original loan, was not material.

Loans that were modified as troubled debt restructurings during the years ended December 31, 2022, 2021 and 2020 and for which there was a subsequent payment default during the respective year were not material.

The Company’s loan and lease portfolio includes commercial lease financing receivables consisting of direct financing and leveraged leases for machinery and equipment, railroad equipment, commercial trucks and trailers, and aircraft. Certain leases contain payment schedules that are tied to variable interest rate indices. In general, early termination options are provided if the lessee is not in default, returns the leased equipment and pays an early termination fee. Additionally, options to purchase the underlying asset by the lessee are generally at the fair market value of the equipment. A summary of lease financing receivables follows:


	December 31,
	2022			2021
	(In thousands)
Commercial leases:
Direct financings:
Lease payments receivable	$	2,174,730		$	873,089
Estimated residual value of leased assets		262,354			75,140
Unearned income		(144,916	)		(68,456	)
Investment in direct financings		2,292,168			879,773
Leveraged leases:
Lease payments receivable		71,371			75,003
Estimated residual value of leased assets		73,397			73,414
Unearned income		(21,689	)		(25,374	)
Investment in leveraged leases		123,079			123,043
Total investment in leases	$	2,415,247		$	1,002,816
Deferred taxes payable arising from leveraged leases	$	51,974		$	56,759

Included within the estimated residual value of leased assets at December 31, 2022 and 2021 were $93 million and $29 million, respectively, in residual value associated with direct financing leases that are guaranteed by the lessees or others.

At December 31, 2022, the minimum future lease payments to be received from lease financings were as follows:


	(In thousands)
Year ending December 31:
2023	$	756,544
2024		621,629
2025		410,540
2026		255,292
2027		129,624
Later years		72,472
	$	2,246,101