What were the main drivers of BNY Mellon's revenue growth in Q2 2017?

Revenue growth was primarily driven by increases in investment services fees (up 4% year-over-year) and investment management and performance fees (up 6% year-over-year). These increases were supported by higher market values, net inflows into assets under management, and growth in clearing services and collateral management solutions. Net interest revenue also contributed significantly, rising 8% due to higher interest rates.

How is BNY Mellon managing its capital and returning capital to shareholders?

BNY Mellon received confirmation from the Federal Reserve that it did not object to its 2017 capital plan. This plan includes the repurchase of up to $2.6 billion of common stock and an additional $500 million contingent on preferred stock issuance. Furthermore, the company approved a 26% increase in its quarterly cash dividend on common stock, from $0.19 to $0.24 per share, demonstrating confidence in its capital position and commitment to shareholders.

What is the company's exposure to market risks, particularly interest rate changes?

BNY Mellon actively manages its exposure to market risks, primarily interest rate and foreign exchange risk. The report indicates that a 100 basis point parallel increase in interest rates would increase pre-tax net interest revenue by $588 million, while a 200 basis point increase would decrease it by $69 million. This sensitivity is influenced by depositor behavior and the company's balance sheet management strategies.

BK/BK-PK 10-Q Quarterly Report Q2 FY2017 — Revenue, Net Income, EPS

Summary

The Bank of New York Mellon Corporation (BK) reported solid results for the second quarter of 2017, with net income applicable to common shareholders reaching $926 million, or $0.88 per diluted share. This represents an increase from both the prior year's second quarter ($825 million, or $0.75 per share) and the prior quarter ($880 million, or $0.83 per share), indicating positive operational momentum. Key drivers of this performance include strong growth in fee and other revenues, particularly from investment services and investment management fees, which benefited from higher market values and net inflows. Net interest revenue also saw a significant increase, up 8% year-over-year, driven by higher interest rates. The company also announced a substantial 26% increase in its quarterly cash dividend, signaling confidence in its financial strength and commitment to returning capital to shareholders. Furthermore, BNY Mellon received regulatory approval for its capital plan, supporting a significant share repurchase program. The company's capital ratios remain robust, with CET1 ratios well above regulatory minimums, demonstrating a strong capital position.

Financial Highlights

37 data points

Beta

Net Income

$975.00M

EPS (Diluted)

$0.88

Total Assets

$354.81B

Cash & Equivalents

$4.72B

Free Cash Flow

-$1.05B

Financial Statements

Beta

Interest Expense	$226.00M
Net Income	$975.00M
EPS (Basic)	$0.88
EPS (Diluted)	$0.88
Shares Outstanding (Basic)	1.04B
Shares Outstanding (Diluted)	1.04B

Key Highlights

1Net income applicable to common shareholders increased to $926 million ($0.88 per diluted share) in Q2 2017, up from $825 million ($0.75 per diluted share) in Q2 2016.
2Assets under Custody/Administration (AUC/A) reached a record $31.1 trillion, a 5% increase year-over-year, primarily due to higher market values.
3Assets under Management (AUM) grew by 6% year-over-year to $1.77 trillion, driven by higher market values and net inflows.
4Investment services fees increased 4% to $1.86 billion, with notable growth in clearing services fees.
5Investment management and performance fees rose 6% to $879 million, reflecting higher market values and performance fees.
6Net interest revenue increased 8% year-over-year to $826 million, primarily due to higher interest rates.
7BNY Mellon announced a 26% increase in its quarterly cash dividend on common stock, from $0.19 to $0.24 per share.

Bank of New York Mellon Corp Quarterly Report for Q2 Ended Jun 30, 2017

Summary

Financial Highlights

Key Highlights

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