M&T Bank Sees Broad 2026 Loan Growth as AI and Fee Businesses Gain Traction

Key Points

• M&T expects broad-based loan growth in 2026, with year-over-year growth estimated at about 6% as middle-market and large corporate customers increase spending. Auto lending is showing modest softness, while other loan categories are strengthening.
• The bank is expanding fee-generating businesses by reducing commercial real estate held on its balance sheet and increasing capital-markets, wealth-management and mortgage-placement activity.
• Technology and AI investments are accelerating: roughly 16,000 of M&T’s 22,000 employees have AI proficiency, and the bank is applying AI to underwriting, fraud and cybersecurity while exploring broader operational efficiencies.

M&T Bank NYSE: MTB Chairman and CEO René Jones said the lender is seeing broad-based loan demand in 2026, supported by what he characterized as one of the strongest operating environments of his career. He also outlined continued investment in technology, process modernization and fee-based businesses as the bank seeks to maintain its competitive position.

Speaking at an investor conference, Jones said M&T's longstanding approach centers on patient decision-making, disciplined underwriting and relationship-based banking. He said the company works to preserve that culture through talent development, including programs that teach banking fundamentals to employees who may not enter the company with financial-services backgrounds.

“The fundamentals of an intermediary, I don't think really change,” Jones said, citing the importance of credit and liquidity management even as technology changes the industry.

Broad Loan Growth, With Some Auto Softness

Jones said 2026 has differed sharply from 2025, when M&T remained cautious on commercial real estate and saw lower utilization in commercial-and-industrial lending. He said much of the C&I growth reported across the industry in 2025 was concentrated in non-depository financial institutions, data centers and other areas in which M&T was not active.

Now, however, “everything you look at is growing in concert,” he said. Jones estimated that year-over-year loan growth was likely around 6%, adding that middle-market businesses as well as large corporations are spending money. He cited only modest softness in auto lending while describing other areas as moving higher.

On deposits, Jones said consumer checking-account growth remains an important long-term foundation for the franchise, while current balance growth is more heavily driven by commercial customers and is somewhat rate-sensitive. Strong loan growth has led the bank to pay somewhat more for deposits outside of demand deposit accounts, he said, but he said such pricing is appropriate when relationships generate attractive returns across multiple services.

Asked about net interest margin expectations, Jones did not provide a new figure, saying that “whatever Daryl says is what is the truth,” referring to another company executive. He said M&T has historically had a relatively high margin but also a higher expense base because of its investment in technology and process improvements.

Fee Businesses and Real Estate Capabilities

Jones said M&T's efforts over the past five years to reduce balance-sheet exposure to commercial real estate while expanding customer capabilities have contributed to stronger fee income. He said the bank's real estate-related businesses have enabled it to continue serving customers without retaining all related loans on its own balance sheet.

Capital-markets activity has also supported fees, according to Jones. He cited Wilmington Trust Institutional Client Services, which earns fees related to securitizations, as well as M&T Realty Capital Corporation and partnerships with private loan markets.

Jones said that in the prior year, M&T originated $6.5 billion of commercial mortgages held on its balance sheet and another $6.5 billion placed into the market. “The profile is really different,” he said, referring to the combination of a robust capital-markets environment and the bank's evolving business model.

For Wilmington Trust, Jones said M&T is evaluating whether it can add capabilities and reach additional wealth-management customer segments. He said the business has traditionally focused on wealth preservation, while a newer group of clients may be more focused on deploying wealth after building businesses or realizing liquidity events.

Technology, AI and Operational Modernization

Jones said technology must be central to a bank's strategy and described M&T's operational-excellence initiative as a broad effort to re-engineer processes for speed, simplicity and customer service.

He said the bank is applying those principles to credit underwriting, including efforts to speed decisions and use technologies such as artificial intelligence for anomaly detection. Such tools could help identify changes in a commercial customer's activity sooner and allow the bank to respond more quickly to potential credit issues.

M&T has increased the pace of customer-affecting releases from roughly 15,000 annually five or six years ago to 65,000 in the most recent year, Jones said. The bank is also investing in artificial intelligence training and experimentation:

• About 16,000 of M&T's 22,000 employees have become proficient in some form of AI, according to Jones.
• The bank is reviewing how outsourced technology vendors are incorporating AI capabilities.
• M&T is conducting experimental work using large language models, including potential credit-related applications.

Jones said M&T currently uses AI in areas including cybersecurity, fraud and credit, with customer-facing applications likely to expand over time. He also cautioned that widespread AI adoption could eventually make banks substantially more efficient but compress industry margins if those savings are competed away through customer pricing.

Capital, Credit and M&A

Jones said M&T repurchased 9% of the company in 2025 at roughly $183 to $184 per share, a period when the bank was less willing to make loans at returns it considered inadequate. With loan growth having improved, he said the company is now focused first on growing its business while also returning excess capital.

He said M&T does not need to raise its capital levels and would seek to deploy any additional capital where it can create the greatest economic value. Still, Jones said he is closely monitoring leverage in the financial system, particularly “hidden leverage” arising from complex and less transparent structures.

On credit, Jones described conditions as healthy and said the bank has no particular C&I or commercial real estate segment that is currently a primary concern. He said management now reviews a different portfolio each week as a routine matter, seeking changes that could signal emerging risks. The bank's reserve-building reflects general conservatism, he said, given the possibility that economic slowing could eventually emerge indirectly in unexpected parts of the portfolio.

Jones said M&T is operationally positioned to absorb an acquisition should an opportunity arise. He said in-market acquisitions that improve local share and density would be especially attractive, particularly in Northeast, Southeast and Mid-Atlantic markets where M&T does not already hold a top-three position.

“Economy is strong,” Jones said near the end of the discussion. While he said interest-rate changes can affect market sentiment, he added that their effects on companies and the broader economy typically take 12 to 15 months to emerge.

About M&T Bank (NYSE:MTB)

M&T Bank Corporation is a regional financial holding company headquartered in Buffalo, New York. Its principal banking subsidiary, Manufacturers and Traders Trust Company, commonly known as M&T Bank, provides financial products and services to individuals, businesses, institutions and government entities.

The company's offerings include checking and savings accounts, consumer and commercial loans, residential mortgages, credit cards, treasury management and other business banking services.

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