M&T Bank Corp. said full-year 2012 profits set a record, topping $1 billion, and fourth-quarter profits doubled from a year ago, driven by strong loan growth, a wider profit margin, better credit and significantly higher revenues from mortgage lending.

The Buffalo-based bank reported net income for the fourth quarter of $296 million, or $2.16 per share, up from $148 million, or $1.04 per share, in the same quarter a year ago. Results were nearly equal to the third quarter of 2012, when the bank earned $293 million, or $2.17 per share.

For the full year, M&T earned $1.03 billion, or $7.54 per share, up 20 percent from $859 million, or $6.35 per share, in 2011. Without one-time items, net operating income rose 21 percent to $1.07 billion, or $7.88 per share, from $884 million, or $6.55 per share, in 2011. The prior record was in 2006.

Meanwhile, the bank continues to prepare for its acquisition of Hudson City Bancorp in New Jersey, which will give it the No. 4 market share in the Garden State, with 97 branches.

“This was a year of tremendous accomplishment, in which M&T recorded record levels of net income and earnings per share,” said Rene F. Jones, executive vice president and chief financial officer. “As we await shareholder and regulatory approvals for our proposed acquisition of Hudson City Bancorp Inc., we are working diligently to prepare to welcome our new employees and customers.”

M&T, one of the nation’s top 20 banks and among the first to report earnings this month, has benefited handsomely from both its own acquisitions as well as others within its market. The bank bought Wilmington Trust Corp. in Delaware, gaining the No. 1 market share in that state, and a prominent wealth manager and corporate financial services business.

It finished integrating those specialty businesses last year and has been marketing those services throughout its footprint to gain more business and boost fee income. And customer retention has “exceeded our expectations,” Jones said.

Last August, M&T agreed to pay $3.7 billion in cash and stock to buy Hudson City of Paramus, N.J., the largest savings bank in the state, with $43.6 billion in assets. The deal adds 135 branches in New Jersey, downstate New York and Fairfield County, Conn.

M&T plans to hire about 200 workers in Western New York and additional staff in New Jersey to support the purchase, and has already identified 49 people to work in the new markets, including 18 from within the bank and 31 new hires. “We’re well on our way,” Jones said.

At the same time, the purchase of HSBC Bank USA’s upstate branch network by cross-town rival First Niagara Financial Group last year, and the subsequent sale of 64 branches to other banks, caused the most significant upheaval in the region’s banking scene in 20 years. That left many customers confused and uncertain about where they would end up and opened the door for M&T to go after disgrunted consumers and businesses.

And M&T got out of the government’s Troubled Assets Relief Program – without raising extra capital that would have diluted shareholders – by helping the Treasury Department auction its remaining preferred stock in M&T.

Meanwhile, as one of the nation’s biggest banks, M&T is now being subjected to annual capital “stress tests” by federal regulators. It submitted its capital plan to regulators last week, and Jones said M&T expects to receive comments by March 30. He said the 2013 plan primarily involves Hudson City and ongoing efforts to build capital to meet new global standards being phased in over several years.

Net interest income from taking deposits and making loans rose 7.8 percent to $674 million, driven by a $2.9 billion increase in average earning assets during the three-month period and a wider profit margin.

Total loans grew $6.5 billion, or 11 percent, from a year ago, to $66.6 billion, “all while improving our capital base and expanding the services we offer our customers,” Jones said. That included an increase of $2.5 billion, or 4 percent, just in the last three months of the year, including higher business, commercial real estate and mortgage loans. Total deposits rose 10 percent from a year ago and 3 percent from the third quarter, to $65.6 billion, with much of the growth in commercial deposits.

The bank set aside $49 million for loan losses, comparable to the third quarter but down 34 percent from $74 million a year ago. That exceeded loans written off as uncollectible, which amounted to $44 million, down from $74 million a year ago.

Not counting the legal settlement a year ago and net losses on investment securities, fee income rose 27 percent to $468 million, mostly from higher mortgage banking revenues of $117 million, as the entire industry benefited from low rates and an improving housing market.

“Another blowout quarter on the mortgage line,” Sandler O’Neill & Partners analyst Joseph Fenech wrote in a report.

M&T also saw improved trust income, and Jones noted that the year-end uncertainty over taxes and the “fiscal cliff” resulted in a record number of legal trusts being set up.

“There was a lot of opportunity around the changes that were coming at the end of the year,” he said.