8-KOther Events

Bank of New York Mellon Corp 8-K Report, Corporate Update (Mar 11, 2015)

Filed March 11, 2015For Securities:BKBK-PKBNYBNY-PK

Summary

The Bank of New York Mellon Corporation (BK) announced on March 11, 2015, that its 2015 capital plan received a non-objection from the Federal Reserve's Board of Governors as part of the Comprehensive Capital Analysis and Review (CCAR). This is a significant positive development, indicating the Federal Reserve's confidence in BNY Mellon's capital adequacy and risk management practices. This approval allows the company to proceed with its capital return strategy. Following the CCAR non-objection, BNY Mellon's Board of Directors approved a new share repurchase program totaling up to $2.4 billion of common stock over five quarters, commencing in Q2 2015 through Q2 2016. An additional $700 million in common stock repurchases may occur if the company issues $1 billion of noncumulative perpetual preferred stock. The company's quarterly dividend of $0.17 per share remains unchanged. Additionally, a summary of BNY Mellon's Dodd-Frank Act stress test results, under a severely adverse scenario, was made available on the company's website.

Key Highlights

  • 1Federal Reserve did not object to BNY Mellon's 2015 capital plan submitted for CCAR.
  • 2Board of Directors approved a new common stock repurchase program of up to $2.4 billion.
  • 3Repurchase program is set to commence in Q2 2015 and conclude in Q2 2016 (a five-quarter period).
  • 4Potential for an additional $700 million in share repurchases contingent on issuing $1 billion in preferred stock.
  • 5Quarterly common stock dividend remains stable at $0.17 per share.
  • 6Company-run Dodd-Frank stress test results under a severely adverse scenario were published on the company's website.

Frequently Asked Questions

The non-objection from the Federal Reserve's Board of Governors regarding BNY Mellon's 2015 capital plan is a strong indicator of the company's financial health and ability to withstand adverse economic conditions. It signifies regulatory approval for the company's capital management strategy, including its plans for capital returns to shareholders.

BNY Mellon has approved a base share repurchase program of up to $2.4 billion, to be executed over five quarters from Q2 2015 to Q2 2016. Additionally, there is a provision for up to $700 million in further repurchases if the company issues $1 billion of preferred stock, bringing the potential total to $3.1 billion.

No, the announcement explicitly states that BNY Mellon's quarterly dividend remains unchanged at $0.17 per share of common stock, subject to declaration by the Board of Directors. The capital return focus is primarily on share repurchases.

A summary of BNY Mellon's and The Bank of New York Mellon's company-run results under the Dodd-Frank stress tests, applying the Federal Reserve’s severely adverse scenario, has been posted to the Company’s website. Investors can refer to that for more detailed information.