MT BANK Corp, which is 24 per cent owned by AIB, said fourth-quarter profit climbed 57 per cent because of fewer writedowns and increased deposits.
Net income or profit rose to $102.2 million, or 92 cents a share, from $64.9 million, or 60 cents, a year earlier, the Buffalo, New York-based bank said.
Profit missed analysts’ estimates. MT said securities writedowns and mortgage service costs reduced net income by $26 million during the quarter, compared with charges of $78 million for collateralised debt obligations a year ago.
“We think the company will survive the credit crisis and emerge a longer-term beneficiary of current market dislocation,” Sandler O’Neill Partners LP analyst Joseph Fenech wrote in a note before results were released. The bank set aside $151 million for credit losses, a 50 per cent increase from a year earlier, joining regional lenders such as Fifth Third Bancorp and KeyCorp that have increased reserves to cover bad home and auto loans.
MT, which has more than 800 branches in states including New York and Pennsylvania, rose $2.30, or 6.5 per cent, to $37.90 yesterday in New York Stock Exchange composite trading before falling back.
AIB has indicated it may sell its stake in MT, worth about $1 billion or €775 million, as part of a recapitalisation. Warren Buffett’s Berkshire Hathaway owns a 6.1 per cent stake in the bank.
