Governor Paterson, in appointing the chairman and CEO of the Buffalo-based M&T Bank Corp., Robert Wilmers, as the new head of the Empire State Development Corp., could end a period in which the state’s development agency has been criticized as ineffectual and adrift due to internal turf wars.

The selection of the 74-year-old Mr. Wilmers as the sole chairman fills an opening created in March with the departure of the former downstate chairman, Patrick Foye.

Pending his confirmation in the state Senate, Mr. Wilmers, who served as deputy finance commissioner under Mayor Lindsay, will take over July 12. He would not receive a salary for the post.

The president and CEO of the Partnership for New York City, Kathryn Wylde, said she is pleased with the selection of Mr. Wilmers because of his business background and because he fills a “leadership vacuum” at the development agency.

“He has built a significant bank, he has a business presence in New York City as well as Buffalo, and he knows the issues. But what is most important is that he can get the ESDC back up and running,” Ms. Wylde said in an interview yesterday.

Founded more than 150 years ago, M&T Bank has more than $65 billion in assets as of last year, and is one of the 20 largest commercial bank holding companies headquartered in America, according to its Web site. Mr. Wilmers has led M&T Bank since 1983.

Mr. Wilmers has his work cut out for him at the development agency. He will be assuming the chairmanship under a governor who wasn’t elected and who may be out of office in two and a half years. The state is also facing a smaller pool of public capital and private investment for costly development projects, a number of which have been either been stalled or scrapped altogether.

The agency recently scrapped plans for a $1.8 billion expansion of the Jacob K. Javits Convention Center and has been unable to breathe life into plans for renovating Pennsylvania Station and for the construction of an Atlantic Yards basketball arena and residential complex in Brooklyn. Under Governor Spitzer, the agency’s structure was changed to accommodate a co-chairmanship — one for upstate New York development and another for downstate development. Now, Mr. Paterson will consolidate leadership under one chairman.

“Because we are one state, we need one leader for ESDC who understands the challenges facing New York as a whole,” Mr. Paterson said in a statement released yesterday, just hours after the upstate chairman, Daniel Gunderson, resigned. “We need someone who understands the challenges of revitalizing upstate, the complexities of jumpstarting the large development and transportation projects downstate, and the economic relationship between upstate and downstate.”

Mr. Wilmers would be based in Buffalo and would launch a search to appoint two leaders to run the downstate and upstate divisions of ESDC. Both would report to Mr. Wilmers.

“We have tremendous assets in New York that we can leverage to grow businesses, grow jobs and grow our economy,” Mr. Wilmers said in a statement. “With the right business plan and the right support in Albany, we can make New York a leader in attracting new investment and creating new jobs.”

The chairman of the Assembly’s Committee on Corporations, Authorities and Commissions, Richard Brodsky, said the appointment was secondary to what he says is a necessary restructuring of the agency.

“I don’t think it matters much who it is, but whether he is willing to come in and immediately restructure from the ground up what is a dysfunctional organization,” he said.