Bank of New York Mellon Corp Quarterly Report for Q2 Ended Jun 30, 2011

Summary

Bank of New York Mellon Corporation (BK) reported solid results for the second quarter of 2011, demonstrating resilience in a challenging economic environment. Net income applicable to common shareholders increased to $735 million, or $0.59 per diluted share, up from $625 million ($0.50 per share) in the prior quarter and $658 million ($0.54 per share) year-over-year. This growth was primarily driven by a significant increase in fee and other revenue, which rose 20% year-over-year to $3.06 billion, largely due to the impact of prior acquisitions and higher market values, alongside net new business. Assets under custody and administration (AUC) reached a record $26.3 trillion, and assets under management (AUM) also hit a record $1.27 trillion, indicating strong client trust and market growth. The company's capital position remained robust, with an estimated Basel III Tier 1 common equity ratio of 6.6% at quarter-end.

Key Highlights

• 1Net income increased to $735 million, or $0.59 per diluted share, showing sequential and year-over-year growth.
• 2Total fee and other revenue grew 20% year-over-year to $3.06 billion, driven by Investment Services and Investment Management fees.
• 3Assets Under Custody and Administration (AUC) reached a record $26.3 trillion, up 21% year-over-year.
• 4Assets Under Management (AUM) reached a record $1.27 trillion, up 22% year-over-year.
• 5Non-interest expense increased 22% year-over-year, primarily due to the impact of acquisitions and higher litigation/legal expenses.
• 6Net interest revenue was $731 million, a 1% increase year-over-year, though net interest margin declined due to lower spreads in the low-rate environment.
• 7Estimated Basel III Tier 1 common equity ratio stood at 6.6% at quarter-end, an improvement from the prior quarter.

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