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M&T Bank would see $900M loss in severely adverse scenario

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M&T Bank would see $900M loss in severely adverse scenario

Buffalo, N.Y.-based M&T Bank Corp. projected a pretax net loss of $900 million during the hypothetical nine-quarter horizon of its internally run midcycle stress test.

The company would record loan and lease losses of $3.0 billion and a total provision expense of $3.6 billion. The company projected pre-provision net revenue would total $2.7 billion.

The company projected its common equity Tier 1 capital ratio falling to a minimum of 9.8%, its Tier 1 risk-based ratio dropping to 11.1%, its total risk-based ratio dropping to 13.7% and its Tier 1 leverage ratio declining as low as 10.1%.

The stress tests are required under the Dodd-Frank Act to ensure banks have sufficient capital to sustain losses and keep lending during a recession. The hypothetical severely adverse economic scenario for the tests runs from June 30, 2017, to Sept. 31, 2019.