Iran war isn't knocking the economy off course, M&T's Bible says

The U.S. economy is holding up well, despite uncertainty over tariffs and other policies, said Daryl Bible, M&T Bank's chief financial officer.

"The situation in Iran poses new risks to the U.S. and global economies through energy prices and uncertainty," Bible said Wednesday, as the bank released its first-quarter earnings.

M&T is keeping tabs on customers who might be impacted over the military conflict with Iran, such as companies connected to petroleum, or farmers who rely on fertilizer.

"Right now, we haven't seen any negative results from the conflict with our customers," he said. "It's probably early on and hopefully this thing gets done sooner, so it doesn't actually get prolonged from that perspective. We're cautiously watching everything."

If the military conflict drags, some commercial customers would be impacted in their supply chain and incur higher costs, Bible said.

"But I think it could have a broader impact on the consumer discretionary (spending), just because if confidence continues to fade down, that could definitely pull that back. And that would have an impact on the (gross domestic product) growth, for sure," he said.

At the moment, he said, consumer spending trends vary depending on income level.

"The higher-end consumer continues to be stronger and is spending, while the lower-end consumer has not declined, but maintained, and is vulnerable to the risks in the environment," he said.

Bible's other insights on the economy and the bank's performance:

Labor market. "People are still hiring," he said. "People who want jobs can still get jobs, for the most part. The economy is growing jobs, and it's positive. If that actually turns negative, that would have a huge impact on the economy."

Allowance for loan losses. M&T kept its allowance for loan losses flat from the previous quarter, even though its criticized loans continued to drop. Bible said the bank was being cautious in light of the Middle East conflict.

"Our balance sheet is really strong and very, very healthy," he said. "In a normal environment, our provision should have come down significantly from what we had. But we chose to keep it where it is."

Acquisitions: Bible said M&T is taking a prudent approach to possible dealmaking.

"We will continue to focus and run the company really well within the market conditions that we have, and if something fits from an M&A perspective, we will consider doing that," he said. "But we aren't going to stretch or do anything from that perspective. There's no need to."

M&T completed its most recent acquisition, its purchase of People's United Financial, four years ago.

First-quarter earnings: M&T in the first quarter recorded net income of $664 million, down from $759 million in the fourth quarter and up from $584 million a year ago.

The bank reported diluted earnings per share of $4.13, compared with $4.67 in the fourth quarter and $3.32 a year ago. The earnings topped analyst forecasts.

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