DBRS: M&T preferreds BB (high)

DBRS said it assigned a rating of BB (high) to M&T Bank Corp.'s $500 million of perpetual, non-cumulative preferred stock. The ratings are positioned four notches below M&T's issuer and senior debt rating of A (low).

The trend is negative.

M&T expects to use $370 million of the net proceeds from the sale of the preferred stock to redeem a portion of its outstanding TARP preferred shares.

Following the repurchase, the company will have $381.5 million of TARP preferred shares still outstanding, DBRS said. The acquisition of Wilmington Trust will add an additional $330 million of TARP preferred stock.

However, DBRS noted that the company intends to redeem this amount at the closing of the merger, which is expected in 2Q11.

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