Wilmington Trust Corporation's (WL) high-net-worth Wealth Advisory Services business will become a Wilmington Trust-branded unit of M&T Bank (MTB) as a result of M&T's plan to acquire the Wilmington, Del.-based trust company.M&T, which is based in Buffalo, N.Y., has agreed to pay $351 million for Wilmington Trust in an all-stock transaction.
Word of the deal, which is expected to close by mid 2011, coincided with the release of Wilmington, Del.-based Wilmington Trust's third-quarter numbers. The trust company reported a loss, its sixth in a row, of $4.06 a share as a result of its exposure to bad construction loans in the mid-Atlantic region.
Under Baltimore-based M&T, Wilmington Trust's Wealth Advisory Services and Corporate Client Services businesses "will continue to operate under the Wilmington Trust brand, with expanded access to M&T's clients and markets," Donald Foley, Wilmington Trust's chairman and chief executive officer, said in a press release.
Wilmington Trust's commercial-banking division, which accounts for the bulk of its business, will become M&T-branded branches with a view to making M&T the dominate retail bank in Delaware as it is in Maryland.
It makes sense to keep the Wilmington Trust branding for its trust, investment and corporate-client services because they are a match for anything on offer from the largest financial institutions, M&T's chairman and chief executive Robert Wilmers said Monday on a conference call hosted by M&T and Wilmington Trust.
In particular, M&T expects to benefit from cross sales of Wilmington Trust's advisory services to M&T's business-banking clients in the Maryland, Delaware, Pennsylvania and upstate New York, he added.
Income from Wilmington Trust's advisory businesses was $92.5 million in its most recent third quarter, down 2% from the third quarter of 2009. Wilmington Trust's advisory businesses are Wealth Advisory Services, Corporate Client Services and affiliated asset managers Cramer Rosenthal McGlynn and Roxbury Capital Management.
The company says the 4% year-over-year slide in third-quarter income for its Wealth Advisory Services group was due to clients moving to lower-fee investment products such as fixed-income and index funds, and because of a reduced stake in multifamily office Grant Tani Barash & Altman.
Wilmington Trust Corporation's (WL) high-net-worth Wealth Advisory Services business will become a Wilmington Trust-branded unit of M&T Bank (MTB) as a result of M&T's plan to acquire the Wilmington, Del.-based trust company.