Davis Polk & Wardwell LLP advised Morgan Stanley & Co. Incorporated and Citigroup Global Markets Inc. as the joint book-running managers on the SEC-registered offering by Allied Irish Banks, p.l.c. (AIB) of 26,700,000 contingent mandatorily exchangeable notes due November 15, 2010, at a price of $77.50 per exchangeable note, for an aggregate principal amount of approximately $2.1 billion. Subject to the approval of AIB’s shareholders, whose consent is required under the rules of the Irish Stock Exchange and the United Kingdom Listing Authority due to the size of the transaction, the notes will be mandatorily exchanged for shares of common stock of M&T Bank Corporation (M&T). The shareholder meeting and the exchange of the notes for shares of M&T common stock are expected to occur by early November. If AIB’s shareholders do not approve the disposition of AIB’s shares of M&T common stock by November 8, 2010, the notes will be redeemed for cash at $77.76 per note using the collateral that AIB has posted to secure its redemption obligation. The notes are listed on the New York Stock Exchange under the symbol “MTC.”

Because AIB is an affiliate of M&T, the offering of the exchangeable notes required the simultaneous delivery of an M&T prospectus covering the 26,700,000 shares of M&T common stock underlying the notes.

AIB provides a diverse range of banking, financial and related services, principally in Ireland, the United Kingdom, Poland and the United States. AIB’s principal retail and commercial banking interests in the United States are its 22.4% nonconsolidated ownership interest in M&T, which resulted from M&T’s 2003 acquisition of Allfirst Financial Inc. from AIB. The disposal of AIB’s shares of M&T common stock through the exchangeable notes offering is one of the key steps AIB is undertaking to meet the increased capital requirements imposed by the Irish Financial Services Regulatory Authority, as part of the Central Bank and Financial Services Authority of Ireland.

M&T is a bank holding company. M&T, through its bank subsidiaries, offers a broad range of financial services to a diverse base of consumers, businesses, professional clients, governmental entities and financial institutions. M&T operates retail and commercial bank branches in New York, Pennsylvania, Maryland, Virginia, West Virginia, Delaware, New Jersey, the District of Columbia, and Ontario, Canada.

The Davis Polk capital markets and financial institutions teams included partners Luigi L. De Ghenghi and John B. Meade and associates Connie I. Milonakis, Andreea Stan, Fiona Watson, E. Ashley Harris, Pawel J. Szaja, Anjali Sara Bonner, Andrea Buti and Adam Riedel. Partner John M. Brandow and associates Posit Laohaphan, Jenny M. Dahlen, James Chenard and Steven Schuh provided equity derivatives advice. Partner Juliet Cain and associates Shakhi Majumdar and Michael J.S. Moran provided credit advice. Partner Po Sit and associate Kay Ng provided tax advice. Partner Gail A. Flesher and associate Emma L. Ahrens provided environmental advice. Natalie Chan was the legal assistant for the transaction. Members of the Davis Polk team are based in the London and New York offices.