M&T Bank Corporation in $350 Million Hybrid Securities Offering

January 31, 2008

Cleary Gottlieb represented M&T Bank Corporation in a registered offering of $350 million 8.500% Enhanced Capital Securities (Enhanced TruPS®) issued by M&T Capital Trust IV and guaranteed by M&T Bank. The Enhanced TruPS were listed on the New York Stock Exchange. The offering priced on January 24 and closed on January 31.

Enhanced TruPS are “hybrid” securities that combine features of traditional debt – such as regular fixed-rate distributions – and traditional equity – such as subordination to debt-holders’ claims in bankruptcy. The sole assets of M&T Capital Trust are junior subordinated debt securities issued by M&T Bank. The junior subordinated debt is “super-subordinated” - ranking junior to all of M&T Bank’s senior debt, subordinated debt and junior subordinated debt issued with traditional trust preferred securities. M&T Bank may defer interest payments on the junior subordinated debt, and M&T Capital Trust IV may defer distributions on the Enhanced TruPS, for up to 40 consecutive quarters. After five years of deferral, M&T Bank must pay the deferred interest from the sale of common stock, except upon the occurrence of certain events that prevent M&T Bank from selling stock.

M&T Bank also entered into a capital replacement covenant for the benefit of holders of securities ranking senior to the junior subordinated debt, which prevents M&T Bank from redeeming the junior subordinated debt except with proceeds from the sale of equity or equity-like securities.

The deal was structured so that the securities will qualify for Tier 1 treatment and will receive favorable state and federal tax treatment. Structuring required consultation with Moody’s and extensive participation of Cleary Gottlieb tax lawyers.