M&T; Bank Corp. shareholders approved yesterday the bank's $3.1 billion takeover of scandal-scarred Allfirst Financial Inc.

Shareholders of Allied Irish Banks PLC, Allfirst's Dublin-based parent, will vote early tomorrow whether to approve the sale to M&T.;

The deal is expected to close before the end of the first quarter, although the conversion of Allfirst branches to M&T; won't take place until the middle of 2003, M&T; said.

"We expected the outcome of today's vote," said C. Michael Zabel, vice president of corporate communications for the Buffalo, N.Y.-based M&T.;

"We are still waiting for the various federal and state regulatory agencies to give us the permissions needed to complete the deal," Zabel said.

So many M&T; shareholders voted by proxy beforehand that yesterday's meeting was a formality, since the bank already had the majority vote it needed. The 11 a.m. meeting was attended by fewer than 50 people, most of whom were company officers, directors or employees, and lasted less than 10 minutes, Zabel said.

Allied Irish agreed in September to sell Allfirst, its Baltimore-based subsidiary, to the Buffalo-based M&T; for $3.1 billion in cash and stock.

Once the deal is completed, M&T; will be the nation's 18th-largest bank.

AIB will retain a 22.5 percent stake in the new entity.

M&T; now is about the 26th-largest U.S. bank.

In February, Allfirst uncovered currency-trading losses of $691.2 million.

In October, John M. Rusnak, the Allfirst currency trader who created the losses, pleaded guilty to one count of bank fraud. He is scheduled for sentencing next month.

M&T; shareholders actually voted on three provisions yesterday to allow the deal to proceed.

M&T; to issue 26.7 million shares of its stock to AIB and to pay the Irish bank $886 million in cash. At yesterday's closing price of $79.88 -- up $1.03 -- the deal would be worth $3.12 billion.

The second measure detailed what it would take to amend the deal's current terms: unanimous approval of the 29 directors M&T; will have once the sale closes, or an affirmative vote by two-thirds of the bank's stockholders.

The third provision amended M&T;'s certificate of incorporation to increase the authorized number of shares from 150 million to 250 million.

Tomorrow, at a special shareholders meeting in Dublin, AIB shareholders will vote on two more provisions needed for approval of the deal.

The first authorizes the bank to take the 22.5 percent stake in M&T;, while the second approves the sale of Allfirst Financial Inc.

The painful process of cutting jobs will start in mid-January, when an undetermined number of Allfirst's 6,000 employees will be notified of their eventual dismissal, M&T; confirmed last week.

Some of those workers will lose their jobs 60 days after receiving their notice, and before conversion is completed.

A second group of targeted employees will be asked to stay on until that conversion is completed. And a third group will be asked to remain in place even beyond that time--perhaps for months afterward, M&T; said last week.

In some cases, M&T; said, inducements such as bonuses will be offered to the Allfirst employees asked to stay on board.

M&T; also said it intends to retain bank tellers, branch managers and other Allfirst employees who deal directly with customers.

Both of those decisions are part of its strategy to make the transition from Allfirst to M&T; as smooth as possible.

The workers who receive job-loss notices will be permitted to apply for openings elsewhere in the M&T; network, the bank said.

M&T; said it is still studying Allfirst to determine how many jobs must be pared for the bank to meet its internal financial goals.