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Will Lower Fed Rates Support MTB's Net Interest Income in 2025?
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Key Takeaways
MTB sees 2025 NII of $7.0B-$7.15B, up from $6.9B in 2024, aided by Fed rate cuts and loan demand.
The bank projects 2025 NIM in the mid-to-high 3.60% range, versus 3.58% reported in 2024.
Average 2025 loan balances are expected to be $135B-$137B, with deposits in the range of $162B-$164B.
M&T Bank Corporation’s (MTB - Free Report) net interest income (NII) is influenced by the Federal Reserve’s interest rate trajectory. This month, the Fed ended a nine-month pause and lowered interest rates by 25 basis points (bps) to 4.00–4.25% and signaled two more rate cuts by year-end.
The Fed trimmed interest rates by 100 bps last year. As such, MTB’s net interest income (NII) rose modestly year over year in the first half of 2025. Over the five years ending 2024, the bank registered a compound annual growth rate (CAGR) of 15.4% in NII, reflecting disciplined asset repricing and balance sheet optimization.
With the current rate cut, expectations for further easing and improving loan demand, MTB appears well-positioned for NII expansion in the coming quarters. Management expects 2025 NII to be in the range of $7.0 billion-$7.15 billion compared with the 2024 reported level of $6.9 billion.
The company expects its net interest margin (NIM) to be in the mid-to-high 3.60% range, compared with the 2024 reported level of 3.58%. It also expects average loan and lease balances to be in the range of $135 billion to $137 billion. Average total deposit balances are anticipated to be $162-$164 billion. In 2024, the company reported average loans and leases of $134.7 billion and total deposits of $161.1 billion.
How MTB’s Peers Are Expected to Fare in Terms of NII
M&T Bank’s peers, such as Comerica Incorporated (CMA - Free Report) and Fifth Third Bancorp (FITB - Free Report) , are also influenced by the interest rate trajectory.
Comerica has posted steady improvement in NII over the years. In the last five years ending 2024, the bank witnessed a CAGR of 3.5%. In the first half of 2025, the metric rose 6.4% year over year to $1,150 million. Comerica projects its third-quarter NII to be slightly lower than the second quarter. It expects 2025 NII to climb in the range of 5%–7% on a year-over-year basis.
Fifth Third has maintained solid momentum in NII growth, with a five-year CAGR (ending 2024) of 4.2%. In the first half of 2025, Fifth Third posted NII of $2.9 billion, up 5.8% from the same period a year ago. For the third quarter of 2025, the bank expects to grow 1% on a sequential basis, supported by healthy loan demand and stabilizing funding costs. For 2025, Fifth Third projects 2025 NII to grow 5.5–6.5% from 2024 levels.
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Will Lower Fed Rates Support MTB's Net Interest Income in 2025?
Key Takeaways
M&T Bank Corporation’s (MTB - Free Report) net interest income (NII) is influenced by the Federal Reserve’s interest rate trajectory. This month, the Fed ended a nine-month pause and lowered interest rates by 25 basis points (bps) to 4.00–4.25% and signaled two more rate cuts by year-end.
The Fed trimmed interest rates by 100 bps last year. As such, MTB’s net interest income (NII) rose modestly year over year in the first half of 2025. Over the five years ending 2024, the bank registered a compound annual growth rate (CAGR) of 15.4% in NII, reflecting disciplined asset repricing and balance sheet optimization.
With the current rate cut, expectations for further easing and improving loan demand, MTB appears well-positioned for NII expansion in the coming quarters. Management expects 2025 NII to be in the range of $7.0 billion-$7.15 billion compared with the 2024 reported level of $6.9 billion.
The company expects its net interest margin (NIM) to be in the mid-to-high 3.60% range, compared with the 2024 reported level of 3.58%. It also expects average loan and lease balances to be in the range of $135 billion to $137 billion. Average total deposit balances are anticipated to be $162-$164 billion. In 2024, the company reported average loans and leases of $134.7 billion and total deposits of $161.1 billion.
How MTB’s Peers Are Expected to Fare in Terms of NII
M&T Bank’s peers, such as Comerica Incorporated (CMA - Free Report) and Fifth Third Bancorp (FITB - Free Report) , are also influenced by the interest rate trajectory.
Comerica has posted steady improvement in NII over the years. In the last five years ending 2024, the bank witnessed a CAGR of 3.5%. In the first half of 2025, the metric rose 6.4% year over year to $1,150 million. Comerica projects its third-quarter NII to be slightly lower than the second quarter. It expects 2025 NII to climb in the range of 5%–7% on a year-over-year basis.
Fifth Third has maintained solid momentum in NII growth, with a five-year CAGR (ending 2024) of 4.2%. In the first half of 2025, Fifth Third posted NII of $2.9 billion, up 5.8% from the same period a year ago. For the third quarter of 2025, the bank expects to grow 1% on a sequential basis, supported by healthy loan demand and stabilizing funding costs. For 2025, Fifth Third projects 2025 NII to grow 5.5–6.5% from 2024 levels.