Company: MTB-PJ
Filing Date: 2025-02-19
Form Type: 10-K
Source: 0001628280-25-006267
Chunk: 34

Company: M&T BANK CORP
Filing Date: 2025-02-19
Form: 10-K
Item: Item 1
Chunk 34
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 $250 billion in total assets, compliance with the rule is required by April 1, 2027.

In October 2023, the Federal Reserve proposed amendments to its rules on interchange fees. Interchange fees, or "swipe" fees, are charges that merchants pay to card-issuing banks, such as M&T Bank, for processing electronic payment transactions. The current interchange fee limitations establish a maximum possible fee for many types of debit interchange transactions that is equal to no more than 21 cents per transaction plus five basis points multiplied by the value of the transaction. The proposed changes would establish a maximum permissible interchange fee of no more than 14.4 cents per transaction plus four basis points multiplied by the value of the transaction. The current rules allow a debit card issuer to recover one cent per transaction for fraud prevention purposes if the issuer complies with certain fraud-related requirements. Under the proposed changes, the fraud prevention adjustment would be increased to 1.3 cents per transaction. The proposed rule would also establish an automatic update of the interchange fee cap every other year based on a survey of debit card issuers.

On December 12, 2024, the CFPB issued a final rule that significantly reforms the regulatory framework governing overdraft practices applicable to banks such as M&T Bank that have more than $10 billion in assets. The rule, which is effective October 1, 2025, modifies or eliminates several long-standing exclusions from requirements generally applicable to consumer credit that previously exempted certain overdraft practices. Under the rule, if covered banks charge overdraft fees that 

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exceed their breakeven cost or a set $5 safe harbor amount, such banks would have to restructure discretionary overdraft arrangements as separate consumer credit accounts that would be subject to consumer credit requirements and certain limitations on compulsory preauthorized transfers to repay amounts owed on such consumer credit accounts. Depending on the approach M&T Bank adopts, these changes to the regulatory framework could result in M&T Bank, among other things, facing higher compliance costs in charging overdraft fees, experiencing a decreased ability to recover amounts extended as overdraft protection under a separate credit arrangement, reducing the availability of overdraft protection, and/or charging lower per item overdraft fees.

In addition, federal law permits states to adopt consumer protection laws and standards that are more stringent than those adopted at the federal level and, in certain circumstances, permits state attorneys general to enforce compliance with both the state and federal laws and regulations. For example, in December 2023, a