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BK · Bank of New York Mellon Corp

21 filings

10-K

BK 10-K Annual Reports

Bank of New York Mellon Corp - 21 annual reports

Filing record · 2016–202610-K1110-Q328-K189

2025
Bank of New York Mellon Corp Annual Report, Year Ended Dec 31, 2025
The Bank of New York Mellon Corporation (BNY, NYSE: BK) closed 2025 with strong results: net income applicable to common shareholders rose 22% to $5.3 billion, or $7.40 per diluted share (up from $5.80), and total revenue grew 8% to $20.1 billion. Fee and other revenue increased 6% on higher investment services fees, client activity, and market values, while net interest income rose 15% to $4.9 billion on the reinvestment of maturing securities at higher yields. Excluding notable items, diluted EPS was $7.50 (Non-GAAP), and the pre-tax operating margin improved to 35% from 31%. Return on common equity reached 13.9% and return on tangible common equity 26.1%. Assets under custody and/or administration grew 14% to $59.3 trillion and assets under management rose 7% to $2.2 trillion, though AUM reflected $93 billion of long-term net outflows offset by market and currency gains. Noninterest expense rose 3% to $13.1 billion, driven by investments, merit increases and revenue-related costs, partly offset by efficiency savings. Full-time employees fell 7% to about 48,100. Capital and liquidity remained strong. The CET1 ratio improved to 11.9% (from 11.2%), and the Tier 1 leverage ratio rose to 6.0%. BNY returned roughly $5.0 billion to shareholders in 2025 through $3.5 billion of buybacks and $1.4 billion of common dividends, and the quarterly common dividend was raised 13% to $0.53. The company also issued $1.5 billion of new preferred stock and redeemed $1.0 billion of Series G preferred. Key risks highlighted include operational and cyber risk, AI-related risk, regulatory change, rate sensitivity, and concentration in financial-institution exposures, with a $700 million reasonably possible litigation loss range disclosed.
Feb 25, 2026
2024
Bank of New York Mellon Corp Annual Report, Year Ended Dec 31, 2024
The Bank of New York Mellon (BNY) closed 2024 with a strong earnings rebound. Net income applicable to common shareholders rose 41% to $4.3 billion, or $5.80 per diluted share (up from $3.89), and was depressed by notable items including severance, litigation reserves and FDIC special assessment adjustments. Excluding these items, adjusted diluted EPS was $6.03, up 19%. Total revenue grew 5% to $18.6 billion, driven by 6% fee revenue growth from higher market values, net new business and FX volumes, while noninterest expense fell 4% to $12.7 billion, reflecting FDIC assessment adjustments and efficiency savings. Pre-tax operating margin improved to 31% from 24%, and ROE rose to 11.9% from 8.6%. Assets under custody and/or administration reached a record $52.1 trillion (up 9%) and assets under management were $2.0 trillion (up 3%). Fee revenue accounts for about 73% of total revenue, which supports earnings durability relative to balance-sheet-driven peers. Net interest income slipped 1% to $4.3 billion as deposit mix shifted, and management expects 2025 net interest income to rise and noninterest expense to increase slightly. Capital and shareholder returns remain central to the investment case. BNY repurchased $3.1 billion of common stock (48.9 million shares) and paid $1.5 billion in dividends, and the quarterly dividend was raised 12% to $0.47. The CET1 ratio declined to 11.2% (Standardized Approach) from 11.5%, and the company remains well capitalized. Key risks flagged include operational and cybersecurity risk, interest rate sensitivity, concentrated exposure to financial institutions and commercial real estate, and the Parent's dependence on subsidiary dividends and IHC support.
Feb 27, 2025
2023
Bank of New York Mellon Corp Annual Report, Year Ended Dec 31, 2023
The Bank of New York Mellon Corporation (BK) reported 2023 net income applicable to common shareholders of $3.1 billion, or $3.87 per diluted share, up from $2.4 billion ($2.90) in 2022. Results include notable items: the FDIC special assessment (about $632 million accrued in Q4 2023, later revised upward by $127 million pre-tax in February 2024), severance, litigation reserves, a fair value reduction in a contingent consideration receivable, and net losses on disposals. Excluding notable items, adjusted EPS was $5.05 (Non-GAAP), up 10% from $4.59. Total revenue rose 7% to $17.5 billion, driven by a 24% increase in net interest revenue to $4.3 billion as higher rates lifted the net interest margin to 1.25%. Fee and other revenue was roughly flat to slightly up at $13.2 billion, with fee revenue down 1% as lower FX volatility and AUM mix offset gains in investment services fees. Noninterest expense rose 2% to $13.3 billion. The balance sheet and capital position strengthened. The CET1 ratio (Advanced Approaches) rose to 11.5% from 11.2%, and the Tier 1 leverage ratio rose to 6.0%. The company returned about $3.9 billion to shareholders through $2.6 billion of buybacks (55.8 million shares) and $1.3 billion of common dividends, and the quarterly dividend was raised 14% to $0.42 in July 2023. Assets under custody and/or administration reached $47.8 trillion and assets under management reached $2.0 trillion. Management expects 2024 net interest revenue to decline versus 2023 and noninterest expense to decrease reported, with flat expenses excluding notable items. Key risks include the sensitivity of fee revenue to market activity, rate-driven deposit flows, credit exposure to commercial real estate (provision of $119 million in 2023), and the regulatory environment, including the proposed Basel III endgame revisions and the FDIC special assessment.
Feb 28, 2024
2022
Bank of New York Mellon Corp Annual Report, Year Ended Dec 31, 2022
The Bank of New York Mellon Corporation (BK) reported a challenging 2022 in which headline earnings were depressed by notable items, although underlying franchise metrics held up. GAAP net income applicable to common shareholders was $2.4 billion, or $2.90 per diluted share, down from $3.6 billion ($4.14) in 2021. Excluding notable items, adjusted diluted EPS was $4.59 (Non-GAAP), up 8%. The main drags were a $680 million non-cash goodwill impairment in the Investment Management unit, a $449 million net loss from repositioning roughly $3 billion of securities, severance and litigation reserves, and the accelerated amortization of depositary receipts costs tied to Russia. Total revenue rose 3% to $16.4 billion, and net interest revenue jumped 34% to $3.5 billion on higher rates, while fee revenue was flat as lower market values and a stronger dollar offset gains. The business mix remains fee-driven, with fee revenue at 79% of total revenue. Securities Services and Market and Wealth Services grew revenue 11% each and posted pre-tax margins of 21% and 44%, respectively. Investment and Wealth Management was the weak spot, with revenue down 12% and pre-tax margin of just 1% (24% adjusted), as AUM fell 25% to $1.8 trillion, reflecting market declines, a stronger dollar and the Alcentra divestiture. Assets under custody and/or administration fell 5% to $44.3 trillion. Capital remained strong, with CET1 at 11.2% and a Tier 1 leverage ratio of 5.8%, and the company returned capital through $1.4 billion of dividends and a new $5.0 billion buyback authorization for 2023. Management guided to higher net interest revenue and noninterest expense growth in 2023, at a slower pace than 2022. For investors, the key questions are whether fee revenue recovers with markets, whether the Investment Management unit's goodwill and earnings stabilize, and how durable the net interest revenue tailwind is as rates and deposit costs move. Deposits fell 13% to $279 billion, a trend worth monitoring alongside the large unrealized securities losses that reduced AOCI to $(6.0) billion.
Feb 27, 2023
2021
Bank of New York Mellon Corp Annual Report, Year Ended Dec 31, 2021
The Bank of New York Mellon (BK) closed 2021 with $46.7 trillion in assets under custody and/or administration (up 14%) and $2.4 trillion in assets under management (up 10%), driven by net client inflows and higher market values. Net income applicable to common shareholders was $3.55 billion, or $4.14 per diluted share, versus $3.83 in 2020. Fee revenue rose 4% to $13.0 billion and fee revenue excluding money market fee waivers rose 9%, but net interest revenue fell 12% to $2.6 billion as net interest margin compressed to 0.68% from 0.84%, and noninterest expense rose 5% to $11.5 billion. Capital was returned aggressively: BNY Mellon repurchased 89.7 million common shares for $4.6 billion in 2021 and raised the quarterly dividend from $0.31 to $0.34. A new $6.0 billion repurchase authorization runs through the fourth quarter of 2022. The CET1 ratio (Standardized Approach) fell to 11.2% from 13.1%, reflecting buybacks, unrealized securities losses, and higher risk-weighted assets, though the firm remained well capitalized. Management expects net interest revenue and fee-waiver recovery to improve in 2022 as short-term rates rise, while noninterest expense is expected to increase. For investors, the key tensions are margin pressure from low rates and a shrinking balance sheet (deposits fell 6% to $319.7 billion) against strong fee-driven growth in custody and asset management. The firm's revenue is about 81% fee-based, which helps offset rate sensitivity, but the securities portfolio (about 36% of assets) and the reliance on market levels remain important risk factors.
Feb 25, 2022
2020
Bank of New York Mellon Corp Annual Report, Year Ended Dec 31, 2020
The Bank of New York Mellon (BK) closed 2020 with $41.1 trillion in assets under custody and/or administration (up 11%) and $2.2 trillion in assets under management (up 16%), driven by higher market values, client inflows, and a weaker U.S. dollar. Net income applicable to common shareholders fell to $3.4 billion ($3.83 diluted EPS) from $4.3 billion ($4.51) in 2019, including $159 million (about $0.18 per share) of notable items tied to litigation, severance, business-sale losses and real estate charges. Fee revenue remained the core engine at roughly 80% of total revenue, but net interest revenue fell 7% to $3.0 billion as the net interest margin compressed to 0.84% from 1.10% amid low rates, and money market fee waivers reduced fee income by about $368 million. Balance sheet growth was large: total assets rose to $470 billion from $382 billion and deposits reached $342 billion, reflecting client cash inflows that were largely parked at central banks. Capital strengthened, with the CET1 ratio rising to 13.1% from 11.5%, supported by earnings and unrealized securities gains, though share repurchases were suspended for most of 2020 under Federal Reserve CCAR limits. Management expects 2021 net interest revenue to keep trending lower, money market fee waivers of roughly $175 million per quarter, and total noninterest expense to be approximately flat. Key risks flagged include low-rate pressure on spread income, pandemic-related credit provisions ($336 million, largely commercial real estate), goodwill sensitivity in the Investment Management unit (about 5% headroom), cybersecurity and operational resilience, and legal exposures such as the Stanford and Brazilian Postalis litigation and German cum/ex tax notices.
Feb 25, 2021
2019
Bank of New York Mellon Corp Annual Report, Year Ended Dec 31, 2019
The Bank of New York Mellon Corporation (BK) reported 2019 net income applicable to common shareholders of $4.3 billion, or $4.51 per diluted share, versus $4.1 billion ($4.04) in 2018. Results were flattered by roughly $467 million (about $0.49 per share) of net one-time benefits, chiefly a $622 million after-tax gain on the sale of its interest in Promontory Interfinancial Network and a reduction of tax-related reserves for certain investment management funds, partially offset by severance, a lease-related impairment, securities losses and litigation expense. Total revenue was essentially flat at $16.5 billion, as fee and other revenue rose 3% to $13.2 billion while net interest revenue fell 12% to $3.2 billion amid higher deposit costs and a net interest margin that compressed to 1.10% from 1.25%. Noninterest expense declined 3% to $10.9 billion. Scale metrics were strong: assets under custody and/or administration reached $37.1 trillion (up 12%) and assets under management $1.9 trillion (up 11%), driven largely by market appreciation and client inflows, though Investment Management fees fell 7% on AUM outflows and lower performance fees. Capital strengthened, with the CET1 ratio under the Advanced Approaches rising to 11.5% from 10.7%, and the company repurchased 69.3 million shares for $3.3 billion while paying $1.2 billion in common dividends. Return on common equity improved to 11.4%. Management flagged several forward-looking items: higher technology spending and pension expense expected in 2020, the adoption of CECL (ASU 2016-13) in 2020 with an expected roughly $50 million after-tax increase to retained earnings, the UK's withdrawal from the EU on January 31, 2020, and the transition away from LIBOR. Leadership also changed, with Todd Gibbons named interim CEO in September 2019 and Joseph Echevarria becoming non-executive Chairman.
Feb 27, 2020
2018
Bank of New York Mellon Corp Annual Report, Year Ended Dec 31, 2018
The Bank of New York Mellon (BK) closed 2018 with net income applicable to common shareholders of $4.1 billion, or $4.04 per diluted share, up from $3.7 per share in 2017. Results were supported by net interest revenue up 9% to $3.6 billion on higher rates (net interest margin 1.25% vs. 1.14%), investment services fees up 5% to $7.8 billion, and total revenue up 5% to $16.4 billion. Noninterest expense rose 2% to $11.2 billion, driven by technology investment, real estate consolidation and currency effects, partially offset by lower bank assessments. The effective tax rate was 18.1%, including adjustments tied to U.S. tax legislation and a $168 million net charge for severance, real estate consolidation and litigation. Assets under custody and/or administration were $33.1 trillion, down 1% year over year, while assets under management fell 9% to $1.7 trillion on a stronger dollar, market declines and net outflows. Fee revenue represented 78% of total revenue, which supports earnings durability relative to balance-sheet-driven peers. Capital remained strong: the CET1 ratio under the Advanced Approach was 10.7%, the SLR was 6.0%, and the company returned capital through $3.3 billion of buybacks and $1.2 billion of dividends, with the quarterly dividend raised 17% to $0.28 in July 2018. Key risks flagged in the filing include the planned UK exit from the EU on March 29, 2019 without a transition agreement, rising technology spending expected to increase 2019 technology costs, pressure from lower-fee investment products, a California utility bankruptcy that is expected to raise nonperforming assets and add a $20–30 million provision in Q1 2019, and a fair-value sensitivity in the securities portfolio, which carried a $907 million net unrealized loss at year end.
Feb 27, 2019
2017
Bank of New York Mellon Corp Annual Report, Year Ended Dec 31, 2017
The Bank of New York Mellon Corporation (BK) closed 2017 with record scale and improving profitability. Assets under custody and/or administration (AUC/A) reached a record $33.3 trillion and assets under management (AUM) reached a record $1.9 trillion, both up roughly 11-15% on higher market values, a weaker U.S. dollar and net new business. Net income applicable to common shareholders was $3.9 billion, or $3.72 per diluted share, up about 14% from $3.15 in 2016, and return on common equity rose to 10.8%. Results were flattered by an estimated $427 million net benefit (about $0.41 per share) from the Tax Cuts and Jobs Act, which lowered the effective tax rate to 10.8%. Fourth-quarter severance, litigation and other charges of $246 million (about $0.24 per share) partly offset that benefit. Revenue quality remains a strength. Fee revenue was 78% of total revenue, and total revenue rose modestly to $15.5 billion. Net interest revenue increased 5% to $3.3 billion as net interest margin widened to 1.14% from 1.03%, reflecting higher rates. Noninterest expense rose 4% to $11.0 billion, driven by staff, software and professional services costs. Capital and liquidity are solid: the Advanced Approach CET1 ratio was 10.7% (about 10.3% fully phased-in), the estimated fully phased-in supplementary leverage ratio was 5.9%, and the liquidity coverage ratio averaged 118%. The company returned $3.6 billion to shareholders in 2017 through $901 million in dividends and $2.7 billion in buybacks, and the quarterly dividend rose 26% to $0.24. Investors should weigh several items. The U.S. tax legislation reduced regulatory capital by $551 million, and the company faces ongoing litigation, including mortgage-securitization trust suits, Stanford-related claims, Brazilian Postalis and Silverado matters, depositary receipt suits and an SEC pre-release inquiry, with reasonably possible losses of up to $840 million above accruals. Management also flagged a 2018 headquarters relocation, a $2.6 billion buyback authorization running through mid-2018, a holding-company structure (the IHC support agreement) that adds structural considerations for debt holders, and continued sensitivity to interest rates and market levels.
Feb 28, 2018
2016
Bank of New York Mellon Corp Annual Report, Year Ended Dec 31, 2016
The Bank of New York Mellon Corporation (BK) reported a solid 2016 in its 10-K filed February 28, 2017. Net income applicable to common shareholders rose to $3.4 billion, or $3.15 per diluted share, up 16% from $2.71 in 2015. Excluding M&I, litigation and restructuring charges and the Sentinel recovery, adjusted diluted EPS was $3.17 (Non-GAAP), up 11%. Total revenue was essentially flat at $15.2 billion, as lower fee revenue from a stronger U.S. dollar, client outflows and lower foreign exchange revenue offset higher net interest revenue. Noninterest expense fell 3% to $10.5 billion, which drove the improvement in pre-tax operating margin to 31% from 28%. The company's scale is substantial: assets under custody and/or administration reached $29.9 trillion and assets under management reached $1.6 trillion at year-end 2016. Fee revenue accounted for about 79% of total revenue, which underpins the business model. Management returned $3.2 billion to shareholders in 2016 ($778 million in dividends and $2.4 billion in buybacks) and raised the quarterly common dividend 12% to $0.19. Total assets fell sharply to $333 billion from $394 billion, mainly because customer deposits declined and interest-bearing deposits held at central banks were reduced, which lifted the leverage-based capital ratios. Capital and regulatory positioning remain strong. The CET1 ratio under the Advanced Approach was 10.6%, and the estimated fully phased-in CET1 ratio was 9.7%. The supplementary leverage ratio improved to 5.6% (fully phased-in). The filing also discloses that regulators found the 2015 resolution plan not credible in April 2016, and that the company's October 2016 resubmission was accepted in December 2016. Key risks for investors include the continued low-margin shift in client assets, foreign exchange revenue pressure, sensitivity to interest rates and the regulatory agenda, including the Volcker Rule, the TLAC rule and the Department of Labor fiduciary rule.
Feb 28, 2017
2015
Bank of New York Mellon Corp Annual Report, Year Ended Dec 31, 2015
The Bank of New York Mellon Corporation (BK) reported 2015 results that were solid on a GAAP basis but mixed in underlying trends. Net income applicable to common shareholders was $3.05 billion, or $2.71 per diluted share, compared with $2.49 billion, or $2.15, in 2014. Excluding a $170 million pre-tax impairment tied to the Sentinel court decision and litigation and restructuring charges, non-GAAP EPS was $2.85. Total revenue fell about 3% to $15.2 billion, as 2014's one-time gains on the sales of Wing Hang and One Wall Street were not repeated. Noninterest expense dropped 11% to $10.8 billion, driven by lower litigation charges, so the pre-tax margin rebounded to 28% from 23%. Assets under custody and/or administration rose to a record $28.9 trillion, while assets under management declined 4% to $1.63 trillion on net outflows and a stronger dollar. Balance sheet and capital remained strong. Total assets were $394 billion, deposits grew 5% to $280 billion, and the Common Equity Tier 1 ratio under the Advanced Approach was 10.8% on a transitional basis, with a fully phased-in estimate of 9.5%. The company returned significant capital, repurchasing $2.4 billion of common stock and paying $762 million in dividends, while issuing $1 billion of preferred stock. Fee revenue represents roughly 79% of total revenue, which supports earnings quality and reduces sensitivity to interest rates, though net interest margin remained thin at 0.98%. Key risks flagged in the filing include a pending Basel-based Total Loss-Absorbing Capacity proposal that could force a material refinancing of senior debt, a one-notch downgrade by S&P following its removal of government support assumptions for U.S. G-SIBs, ongoing legal and regulatory exposures (including the Tax Court foreign tax credit matter with a $593 million 2013 impact and the Stanford and Postalis matters), and the operational risk capital charge that is pushing up risk-weighted assets under the Advanced Approach.
Feb 26, 2016
2014
Bank of New York Mellon Corp Annual Report, Year Ended Dec 31, 2014
The Bank of New York Mellon (BK) closed 2014 with net income applicable to common shareholders of $2.5 billion, or $2.15 per diluted share, versus $2.0 billion ($1.73) in 2013. Management's adjusted non-GAAP figure was $2.8 billion ($2.39), excluding a $315 million gain on the sale of Wing Hang, a $204 million after-tax gain on the One Wall Street building sale, a $150 million tax carryback benefit, and $860 million of litigation and restructuring charges. The headline GAAP result was weighed down by a $598 million after-tax litigation accrual added in February 2015, largely for the foreign exchange standing-instruction matters, and by noninterest expense rising 8% to $12.2 billion. Underlying fee businesses held up. Fee and other revenue rose 7% to $12.6 billion, led by investment management and performance fees (up 3% to $3.5 billion) and asset servicing (up 4%). Assets under custody and/or administration reached a record $28.5 trillion and assets under management reached $1.71 trillion, supported by market gains and net new business. Net interest revenue fell 4% to $2.9 billion as net interest margin compressed to 0.97% from 1.13%, reflecting lower yields and a deliberate reduction in interbank placements in favor of high-quality liquid assets. Capital and balance sheet items warrant attention. The estimated fully phased-in Basel III CET1 ratio under the Advanced Approach fell to 9.8% from 11.3%, driven by higher risk-weighted assets, including the consolidation of certain investment management funds. Under the Standardized Approach it was 10.6%, unchanged. The company repurchased $1.7 billion of stock and paid $0.66 per share in dividends, a 13% increase in the quarterly rate to $0.17 announced in April 2014. Management also flagged regulatory pressure, including the FDIC's view that the 2013 resolution plans were not credible, and the Federal Reserve's scrutiny of dividend payout ratios above 30%. The company's 2014 payout ratio was 31%, or 25% excluding litigation.
Feb 27, 2015
2013
Bank of New York Mellon Corp Annual Report, Year Ended Dec 31, 2013
The Bank of New York Mellon Corporation (BK) reported 2013 results that were solid on fee revenue and capital strength but weighed down by a one-time tax charge. Net income applicable to common shareholders was $2.0 billion, or $1.74 per diluted share, versus $2.4 billion ($2.03) in 2012. Excluding a $593 million net after-tax charge tied to U.S. Tax Court rulings on disallowed foreign tax credits, earnings would have been $2.64 billion, or $2.24 per diluted share (non-GAAP). Total fee and other revenue rose 3% to $11.8 billion, led by investment management fees (up 7%) and investment services fees (up 4%), while net interest revenue was roughly flat at $3.0 billion as net interest margin compressed to 1.13% from 1.21% amid low rates. The company remains a fee-driven global custodian and asset manager, with $27.6 trillion in assets under custody and/or administration and a record $1.6 trillion in assets under management at year-end 2013. Noninterest expense was essentially flat at $11.3 billion, with lower litigation costs offsetting higher staff, software and branding spending. Credit quality remained strong, with a $35 million credit to the provision for credit losses and nonperforming assets falling to $156 million. Capital and shareholder returns were central themes. The Basel III Tier 1 common equity ratio was an estimated 10.6% under the Standardized Approach on a fully phased-in basis, and the company was approved to move to the Advanced Approaches framework from Q2 2014. Management repurchased $1.03 billion of common stock in 2013 and raised the quarterly dividend 15% to $0.15. Key risks flagged include Moody's one-notch ratings downgrade in November 2013, the ongoing run-off of high-margin structured debt securitizations, the foreign exchange standing instruction litigation, and the Sentinel loan dispute.
Feb 28, 2014
2012-A
Bank of New York Mellon Corp Annual Report (Amendment), Year Ended Dec 31, 2012
This filing is an amendment (10-K/A) to The Bank of New York Mellon Corporation's (BK) 2012 Annual Report. The primary purpose of this amendment is to restate Part II, Item 9A concerning the company's disclosure controls and procedures. Specifically, management identified that the disclosure controls and procedures were not effective as of December 31, 2012, due to issues with the processes and procedures for reporting Assets under Custody and/or Administration (AUC/A). While the errors related to AUC/A are noted as being unrelated to internal controls over financial reporting, the company has taken steps to remediate these issues by streamlining and enhancing data collection processes and systems for AUC/A. A broader review of reporting processes for other public filing information has also commenced, with ongoing efforts to correct and improve policies and procedures. This amendment assures investors that the company is actively addressing control deficiencies and strengthening its reporting mechanisms.
May 9, 2013
2012
Bank of New York Mellon Corp Annual Report, Year Ended Dec 31, 2012
The Bank of New York Mellon (BNY Mellon) reported 2012 net income applicable to common shareholders of $2.4 billion, or $2.03 per diluted share, roughly flat versus 2011 ($2.5 billion, $2.03). The company is a fee-driven global custodian and asset manager, with $26.2 trillion in assets under custody and/or administration (AUC/A) and a record $1.4 trillion in assets under management (AUM) at year-end. Fee revenue of $11.2 billion declined 2% largely due to the 2011 sale of Shareowner Services, while noninterest expense rose 2% to $11.3 billion, driven by higher litigation charges. Net interest revenue was flat at $3.0 billion, though net interest margin compressed to 1.21% from 1.36% amid low rates and the ECB's elimination of deposit interest. Capital strengthened: the estimated Basel III Tier 1 common equity ratio rose to 9.8% from 7.1%, and the company returned capital through $1.12 billion of 2012 buybacks and a $0.13 quarterly dividend, with a 2013 capital plan pending Federal Reserve review. Management flagged several near-term items: an expected roughly $850 million after-tax charge in Q1 2013 following an adverse U.S. Tax Court ruling on foreign tax credits (about 55 basis points of Basel III capital impact), and an AUC/A restatement that cut the year-end figure by $0.5 trillion from the preliminary $26.7 trillion, with disclosure controls over that metric judged ineffective (remediated after year-end, and unrelated to internal control over financial reporting). Investors should weigh the strong capital position and asset growth against pressure on net interest revenue, rising legal costs, and the Q1 2013 tax charge. Foreign exchange revenue fell 18% on low volatility, and the company's fee-based model remains sensitive to market levels and capital-markets activity.
Feb 28, 2013
2011
Bank of New York Mellon Corp Annual Report, Year Ended Dec 31, 2011
The Bank of New York Mellon (BK) closed 2011 with net income applicable to common shareholders of $2.5 billion, or $2.03 per diluted share, roughly flat with $2.05 in 2010. Results reflect a fee-driven model: total fee revenue rose 7% to $11.5 billion, led by investment services fees (up 13% to $6.8 billion, helped by the full-year impact of the GIS and BAS acquisitions) and investment management fees (up 5% to $3.0 billion). Net interest revenue was essentially flat at $3.0 billion as the net interest margin compressed to 1.36% from 1.70%, reflecting the low-rate environment and a sharp rise in low-yielding central bank deposits. Noninterest expense rose 9% to $11.1 billion, so pre-tax margin fell to 24-25% from 26-27%. Balance sheet growth was dramatic. Total assets rose to $325 billion from $247 billion, driven by a $74 billion increase in client deposits to $219 billion, as clients moved cash to safety amid European sovereign stress. Management is treating this as a liquidity and capital-intensity story: the Basel I Tier 1 ratio rose to 15.0%, but the estimated Basel III Tier 1 common equity ratio is 7.1%, and the leverage ratio fell to 5.2%. Capital return remained active, with a dividend increase to $0.13 per quarter and $835 million of buybacks in 2011, though future payouts face Federal Reserve capital-plan scrutiny. Key risks for investors include credit rating pressure (S&P downgraded the parent by one notch in November 2011 and Moody's placed ratings on review for downgrade in December), a heavy litigation docket (including Sentinel, Madoff-related, foreign exchange, German broker-dealer, and tax matters, with a reasonably possible loss of up to $1.05 billion above accruals), and regulatory changes under Dodd-Frank, the Volcker Rule, and expected G-SIB capital surcharges.
Feb 28, 2012
2010
Bank of New York Mellon Corp Annual Report, Year Ended Dec 31, 2010
The Bank of New York Mellon (BNY Mellon) reported 2010 net income applicable to common shareholders of $2.5 billion, or $2.05 per diluted share, versus a net loss of $1.4 billion in 2009, which was driven by roughly $5.4 billion of pre-tax securities restructuring losses. Excluding those losses and other charges, the company's results improved on higher market values, the GIS and BAS acquisitions completed in mid-2010, and lower provisions for credit losses ($11 million versus $332 million). Assets under custody and administration reached a record $25.0 trillion and assets under management reached $1.17 trillion at year-end 2010. The balance sheet strengthened over the year. The Tier 1 capital ratio rose to 13.4% from 12.1%, supported by earnings retention and a $677 million common equity issuance, and the company estimates its Tier 1 common ratio under Basel III will exceed 7% by year-end 2011. Net interest margin compressed to 1.70% from 1.82% amid the low-rate environment, and fee revenue remains about 78% of total revenue, so the business is still heavily dependent on market levels and transaction volumes. For investors, the key watch items are the dividend (held at $0.09 per quarter and subject to Federal Reserve review, with payout ratios above 30% drawing scrutiny), the pace of Basel III and Dodd-Frank implementation, including likely designation as a systemically important institution, ongoing litigation (including Sentinel, Madoff-related, securities lending, and German broker-dealer matters, with reasonably possible losses estimated at $200 million to $500 million above accruals), and the integration of acquired businesses.
Feb 28, 2011
2009-A
Bank of New York Mellon Corp Annual Report (Amendment), Year Ended Dec 31, 2009
This filing is an amendment to Bank of New York Mellon Corporation's (BK) 2009 10-K report, filed on May 14, 2010. It primarily details information regarding the company's directors, executive officers, and corporate governance, as well as executive compensation. The document emphasizes the adoption of a Code of Conduct for all employees and a separate Directors' Code of Conduct, both available on the company's website and upon written request. Key information pertains to the leadership team, listing executive officers by name, age, and their roles, with specific details on their tenure and prior experience, particularly in relation to the 2007 merger. The filing also incorporates by reference information from the company's proxy statement concerning executive compensation, director compensation, and the findings of the Human Resources and Compensation Committee regarding compensation policies and risks. Investors seeking a comprehensive understanding of BK's corporate structure and executive remuneration will find this filing informative, though it does not contain detailed financial statements or performance metrics, which are assumed to be in the original 10-K filing.
May 14, 2010
2009
Bank of New York Mellon Corp Annual Report, Year Ended Dec 31, 2009
The Bank of New York Mellon (NYSE: BK) closed 2009 with a sharply weaker reported result driven by a deliberate balance-sheet repositioning. The company posted a net loss applicable to common shareholders of $1.37 billion, or $1.16 per diluted share, versus net income of $1.39 billion ($1.20) in 2008. Loss from continuing operations was $0.93 per share. The decline was dominated by $5.4 billion of pre-tax net investment securities losses, mainly from the sale and restructuring of about $13.5 billion (amortized cost) of watch-list securities, principally Alt-A, prime and subprime RMBS. Excluding those items and other charges, management's non-GAAP view shows a much healthier fee-based franchise, with fee revenue down 18% to $10.1 billion on lower equity markets, weaker securities lending spreads and a 21% drop in FX volumes. Expense discipline was a clear positive. Noninterest expense fell 17% to $9.6 billion, reflecting lower incentives, merger synergies and a stronger dollar. Net interest revenue was flat at $2.9 billion despite historically low rates, and the company's loan book shrank as management cut targeted credit exposure. Balance-sheet strength improved on a common-equity basis: the Tier 1 capital ratio fell to 12.1% from 13.2% because of the securities charge and the $3.0 billion repurchase of TARP preferred stock, but Tier 1 common equity rose to 10.5% and the tangible common equity ratio improved to 5.2% from 3.8%. Book value per share rose to $23.99 and the company raised $1.4 billion of common equity in 2009. For investors, the central questions are the durability of fee revenue as markets recover, the timing of the expected return of dividend flexibility (management expects regulatory consent restrictions to lift in Q4 2010), and the cost of pending transactions, including the $2.31 billion agreement to acquire Global Investment Servicing from PNC, which would add roughly $855 billion in assets under administration. Several regulatory overhangs also remain, including a proposed Financial Crisis Responsibility Fee estimated at about $200 million per year, Basel III capital proposals that could disqualify trust preferred securities from Tier 1, and a pending $900 million IRS tax dispute.
Feb 26, 2010
2008
Bank of New York Mellon Corp Annual Report, Year Ended Dec 31, 2008
The Bank of New York Mellon (BK) closed 2008 with a difficult earnings year marked by heavy non-operating charges, but a much larger balance sheet and a stronger liquidity and capital position. Net income applicable to common stock was $1.386 billion, or $1.20 diluted EPS (continuing operations $1.22), versus $2.04 billion ($2.18) in 2007. Results absorbed $1.6 billion of pre-tax securities write-downs (mainly Alt-A and other housing-related RMBS), an $894 million charge for voluntary support agreements tied to Lehman-exposed money market and cash funds, $489 million of SILO/LILO charges, $483 million of merger and integration expenses, and a $181 million restructuring charge tied to a roughly 4% workforce reduction. Fee and other revenue rose 18% to $10.7 billion, driven by the July 2007 Mellon Financial merger, record foreign exchange trading revenue of $1.5 billion, and money market inflows. Net interest revenue grew 28% to $3.0 billion. The balance sheet expanded sharply, with total assets reaching $237.5 billion (from $197.7 billion) and deposits rising 35% to $159.7 billion as clients sought safe havens during the market turmoil. Available liquidity was roughly $105 billion, or 44% of total assets. Capital strengthened: the Tier I capital ratio rose to 13.3% from 9.3%, helped by a $3 billion U.S. Treasury TARP preferred investment and warrant, though tangible common equity fell to 3.8% of assets and book value per common share declined to $22.00 from $25.66. Assets under management fell 17% to $928 billion and assets under custody and administration fell 13% to $20.2 trillion, reflecting market declines and a stronger dollar, partly offset by net money market inflows of $92 billion. Looking ahead, management said nonperforming assets are expected to rise in 2009, noting weakness in South Florida commercial real estate. The filing flags Basel II implementation, potential further securities impairments, FDIC assessment increases, and TARP-related dividend restrictions, including a limit on common dividends to $0.24 per quarter while the Treasury holds the Series B preferred. A pending Russian federal claim seeking $22.5 billion in damages and a Sentinel Management bankruptcy adversary proceeding are the most significant legal matters, though management does not expect them to have a material effect on the consolidated financial position.
Feb 27, 2009
2007
Bank of New York Mellon Corp Annual Report, Year Ended Dec 31, 2007
The Bank of New York Mellon's 2007 10-K (filed February 28, 2008) reflects a transformative year driven by the July 1, 2007 merger with Mellon Financial Corporation, which was accounted for as a purchase valued at roughly $17 billion. Reported 2007 net income was $2.039 billion, or $2.18 diluted EPS, versus $2.847 billion ($3.94) in 2006, which included a large $1.371 billion gain from discontinued operations tied to the Retail Business sale. Income from continuing operations was $2.227 billion ($2.38 diluted EPS), and excluding $404 million of pre-tax merger and integration expense, continuing EPS was $2.64. Total revenue rose to $11.3 billion from $6.8 billion, and fee and other revenue reached $9.0 billion (80% of FTE revenue), with growth in securities servicing, asset and wealth management, and foreign exchange. Assets under management reached $1.121 trillion and assets under custody and administration reached $23.1 trillion, while total assets roughly doubled to $197.7 billion.
Feb 28, 2008