Delaware
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001-35651
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13-2614959
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(State or other jurisdiction
of incorporation) |
(Commission
File Number) |
(I.R.S. Employer Identification No.)
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225 Liberty Street
New York, New York
(Address of principal executive offices)
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10286
(Zip code) |
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Exhibit
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Number
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Description
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99.1
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99.2
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99.3
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The Bank of New York Mellon Corporation
(Registrant)
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Date: January 18, 2018
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By:
/s/ Craig T. Beazer
|
|
Name: Craig T. Beazer
Title: Secretary
|
BNY Mellon 4Q17 Earnings Release
|
News Release
|
|
•
|
U.S. tax legislation estimated net benefit of $
427 million
, or
$0.41
per common share
|
•
|
Severance, litigation and other charges of $
246 million
, or
$0.24
per common share
(a)
|
•
|
Includes $320 million negative impact related to U.S. tax legislation and other charges
(a)
; which decreased total revenue growth by 8%
|
•
|
Investment management and performance fees increased
13%
|
•
|
Investment services fees increased
5%
; Asset servicing fees increased
6%
|
•
|
Includes
$282 million
(pre-tax) for severance, litigation and other charges
(a)
; which increased total expense growth by 11%
|
•
|
Total revenue up
2%
and total expense up
4%
|
•
|
Includes impact of U.S. tax legislation, severance, litigation and other charges
(a)
;
which decreased revenue growth by 2% and increased expense growth by 3%
|
•
|
These items increased earnings per share growth by 5%
|
•
|
Returned nearly $900 million through share repurchases and dividends and $3.6 billion in full-year 2017
|
(a)
|
Other charges include an asset impairment and investment securities losses related to the sale of certain securities.
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Media Relations:
Jennifer Hendricks Sullivan (212) 635-1374
|
I
nvestor Relations:
Valerie Haertel (212) 635-8529
|
BNY Mellon 4Q17 Earnings Release
|
•
|
Reported 4Q earnings of $1.13 billion, or $1.08 per common share, including the estimated impact of U.S. tax legislation and other charges
(a).
|
Amounts included in 4Q17 results
|
|
|
|
|
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|
||||||
(dollars in millions, except earnings per share)
|
Results - GAAP
|
|
|
U.S. tax legislation
|
|
|
Other charges
|
|
(a)
|
|||
Fee and other revenue
|
$
|
2,860
|
|
|
$
|
(279
|
)
|
|
$
|
(37
|
)
|
|
Income from consolidated investment management funds
|
17
|
|
|
—
|
|
|
—
|
|
|
|||
Net interest revenue
|
851
|
|
|
(4
|
)
|
|
—
|
|
|
|||
Total revenue
|
3,728
|
|
|
(283
|
)
|
|
(37
|
)
|
|
|||
Provision for credit losses
|
(6
|
)
|
|
—
|
|
|
—
|
|
|
|||
Total noninterest expense
|
3,006
|
|
|
—
|
|
|
282
|
|
|
|||
Income before taxes
|
728
|
|
|
(283
|
)
|
|
(319
|
)
|
|
|||
(Benefit) provision for income taxes
|
(453
|
)
|
|
(710
|
)
|
|
(73
|
)
|
|
|||
Net income
|
$
|
1,181
|
|
|
$
|
427
|
|
|
$
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(246
|
)
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||||||
Diluted earnings per common share
|
$
|
1.08
|
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$
|
0.41
|
|
|
$
|
(0.24
|
)
|
|
(a)
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Other charges include severance, litigation, an asset impairment and investment securities losses related to the sale of certain securities.
|
•
|
Total revenue of $
3.7 billion
, decreased
2%
.
|
•
|
Investment services fees increased
5%
reflecting higher money market fees, higher equity market values and
termination fees due to lost business recorded in 4Q17
.
|
•
|
Investment management and performance fees increased
13%
due to higher equity market values, money market fees, performance fees and the favorable impact of a weaker U.S. dollar. Investment management and performance fees increased
11%
on a constant currency basis (Non-GAAP)
(b)
.
|
•
|
Foreign exchange revenue was unchanged reflecting higher volumes offset by lower volatility.
|
•
|
Investment and other income decreased reflecting the impact of U.S. tax legislation on our renewable energy investments.
|
•
|
Net interest revenue increased
2%
driven by higher interest rates, offset by
lower average deposits and loans as well as the impact of interest rate hedging activities and leasing.
|
•
|
The provision for credit losses was a credit of
$6 million
.
|
•
|
Noninterest expense of
$3.0 billion
, increased
14%
reflecting higher severance, litigation and an asset impairment, as well as higher incentive expense driven by stronger performance and the unfavorable impact of the weaker U.S. dollar.
|
•
|
Preferred stock dividends of
$49 million
.
|
•
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U.S. tax legislation increased net income by an estimated
$427 million
as follows:
|
(estimated in millions)
|
Total revenue
|
|
Income taxes
|
|
Net income
|
|
|||
Remeasurement of net deferred tax liabilities
(c)
|
$
|
—
|
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$
|
1,191
|
|
$
|
1,191
|
|
Repatriation tax
|
—
|
|
(723
|
)
|
(723
|
)
|
|||
Other items
|
(4
|
)
|
(39
|
)
|
(43
|
)
|
|||
Renewable energy investments
|
(279
|
)
|
281
|
|
2
|
|
|||
|
$
|
(283
|
)
|
$
|
710
|
|
$
|
427
|
|
(c)
|
Excluding deferred tax liabilities related to renewable energy investments.
|
•
|
Regulatory capital decreased by $551 million driven by the repatriation tax, offset by the tax benefit related to the remeasurement of certain deferred tax liabilities.
|
•
|
Effective tax rate for 2018 is expected to be approximately 21%.
|
Page -
2
|
BNY Mellon 4Q17 Earnings Release
|
•
|
Record AUC/A of
$33.3 trillion
increased
11%
reflecting higher market values, the favorable impact of a weaker U.S. dollar and net new business.
|
•
|
Estimated new AUC/A wins in Asset Servicing of
$575 billion
in
4Q17
.
|
•
|
Record AUM of
$1.9 trillion
increased
15%
reflecting
higher market values, the favorable impact of a weaker U.S. dollar and net inflows.
|
•
|
Net long-term inflows of
$16 billion
in
4Q17
reflect inflows of
l
iability-driven investments, partially offset by outflows of active equity and fixed income investments and index funds.
|
•
|
Net short-term outflows of
$4 billion
in
4Q17
.
|
•
|
Repurchased
12 million
common shares for
$651 million
and paid
$248 million
in dividends to common shareholders and repurchased
55 million
common shares for
$2.7 billion
and paid $901 million in dividends in full-year 2017.
|
•
|
Return on common equity of
12%
and
11%
in full-year 2017.
|
•
|
Adjusted return on tangible common equity of
27%
and
24%
in full-year 2017
(b)
.
|
•
|
SLR – transitional of
6.1%
; SLR – fully phased-in of
5.9%
(b)
.
|
•
|
Average LCR of
118%
.
|
|
|
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(b)
|
See “Supplemental information – Explanation of GAAP and Non-GAAP financial measures” beginning on page
23
for the reconciliation of Non-GAAP measures. In all periods presented, Non-GAAP information excludes the net income attributable to noncontrolling interests of consolidated investment management funds, amortization of intangible assets and M&I, litigation and restructuring charges. See “Capital and Liquidity” beginning on page
12
for the reconciliation of the SLR.
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Page -
3
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BNY Mellon 4Q17 Earnings Release
|
(dollars in millions, except per share amounts; common shares in thousands)
|
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4Q17 vs.
|
|||||||||||||
4Q17
|
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3Q17
|
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2Q17
|
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1Q17
|
|
4Q16
|
|
3Q17
|
4Q16
|
||||||||
Revenue:
|
|
|
|
|
|
|
|
||||||||||||
Fee and other revenue
|
$
|
2,860
|
|
$
|
3,167
|
|
$
|
3,120
|
|
$
|
3,018
|
|
$
|
2,954
|
|
(10
|
)%
|
(3
|
)%
|
Income from consolidated investment management funds
|
17
|
|
10
|
|
10
|
|
33
|
|
5
|
|
|
|
|||||||
Net interest revenue
|
851
|
|
839
|
|
826
|
|
792
|
|
831
|
|
1
|
|
2
|
|
|||||
Total revenue – GAAP
|
3,728
|
|
4,016
|
|
3,956
|
|
3,843
|
|
3,790
|
|
(7
|
)
|
(2
|
)
|
|||||
Less: Net income attributable to noncontrolling interests related to consolidated investment management funds
|
9
|
|
3
|
|
3
|
|
18
|
|
4
|
|
|
|
|||||||
Total revenue, as adjusted – Non-GAAP
|
3,719
|
|
4,013
|
|
3,953
|
|
3,825
|
|
3,786
|
|
(7
|
)
|
(2
|
)
|
|||||
Provision for credit losses
|
(6
|
)
|
(6
|
)
|
(7
|
)
|
(5
|
)
|
7
|
|
|
|
|||||||
Expense:
|
|
|
|
|
|
|
|
||||||||||||
Noninterest expense – GAAP
|
3,006
|
|
2,654
|
|
2,655
|
|
2,642
|
|
2,631
|
|
13
|
|
14
|
|
|||||
Less: Amortization of intangible assets
|
52
|
|
52
|
|
53
|
|
52
|
|
60
|
|
|
|
|||||||
M&I, litigation and restructuring charges
|
80
|
|
6
|
|
12
|
|
8
|
|
7
|
|
|
|
|||||||
Total noninterest expense, as adjusted – Non-GAAP
|
2,874
|
|
2,596
|
|
2,590
|
|
2,582
|
|
2,564
|
|
11
|
|
12
|
|
|||||
Income:
|
|
|
|
|
|
|
|
||||||||||||
Income before income taxes
|
728
|
|
1,368
|
|
1,308
|
|
1,206
|
|
1,152
|
|
(47
|
)%
|
(37)%
|
||||||
(Benefit) provision for income taxes
|
(453
|
)
|
348
|
|
332
|
|
269
|
|
280
|
|
|
|
|||||||
Net income
|
$
|
1,181
|
|
$
|
1,020
|
|
$
|
976
|
|
$
|
937
|
|
$
|
872
|
|
|
|
||
Net (income) attributable to noncontrolling interests
(a)
|
(6
|
)
|
(2
|
)
|
(1
|
)
|
(15
|
)
|
(2
|
)
|
|
|
|||||||
Net income applicable to shareholders of The Bank of New York Mellon Corporation
|
1,175
|
|
1,018
|
|
975
|
|
922
|
|
870
|
|
|
|
|||||||
Preferred stock dividends
|
(49
|
)
|
(35
|
)
|
(49
|
)
|
(42
|
)
|
(48
|
)
|
|
|
|||||||
Net income applicable to common shareholders of The Bank of New York Mellon Corporation
|
$
|
1,126
|
|
$
|
983
|
|
$
|
926
|
|
$
|
880
|
|
$
|
822
|
|
|
|
||
|
|
|
|
|
|
|
|
||||||||||||
Operating leverage
(b)
|
|
|
|
|
|
(2,043
|
) bps
|
(1,589
|
) bps
|
||||||||||
Adjusted operating leverage – Non-GAAP
(b)(c)
|
|
|
|
|
|
(1,804
|
) bps
|
(1,386
|
) bps
|
||||||||||
|
|
|
|
|
|
|
|
||||||||||||
Key Metrics:
|
|
|
|
|
|
|
|
||||||||||||
Pre-tax operating margin
(c)
|
20
|
%
|
34
|
%
|
33
|
%
|
31
|
%
|
30
|
%
|
|
|
|||||||
Adjusted pre-tax operating margin – Non-GAAP
(c)
|
23
|
%
|
35
|
%
|
35
|
%
|
33
|
%
|
32
|
%
|
|
|
|||||||
|
|
|
|
|
|
|
|
||||||||||||
Return on common equity
(annualized)
(c)
|
12.1
|
%
|
10.6
|
%
|
10.4
|
%
|
10.2
|
%
|
9.3
|
%
|
|
|
|||||||
Adjusted return on common equity
(annualized)
–
Non-GAAP
(c)
|
13.2
|
%
|
11.0
|
%
|
10.8
|
%
|
10.7
|
%
|
9.8
|
%
|
|
|
|||||||
|
|
|
|
|
|
|
|
||||||||||||
Return on tangible common equity
(annualized)
–
Non-GAAP
(c)(d)
|
25.9
|
%
|
21.9
|
%
|
21.9
|
%
|
22.2
|
%
|
20.4
|
%
|
|
|
|||||||
Adjusted return on tangible common equity
(annualized)
– Non-GAAP
(c)(d)
|
27.4
|
%
|
22.0
|
%
|
22.1
|
%
|
22.4
|
%
|
20.5
|
%
|
|
|
|||||||
|
|
|
|
|
|
|
|
||||||||||||
Fee revenue as a percentage of total revenue
|
77
|
%
|
78
|
%
|
79
|
%
|
78
|
%
|
78
|
%
|
|
|
|||||||
|
|
|
|
|
|
|
|
||||||||||||
Percentage of non-U.S. total revenue
|
39
|
%
|
36
|
%
|
35
|
%
|
34
|
%
|
34
|
%
|
|
|
|||||||
|
|
|
|
|
|
|
|
||||||||||||
Average common shares and equivalents outstanding:
|
|
|
|
|
|
|
|
||||||||||||
Basic
|
1,024,828
|
|
1,035,337
|
|
1,035,829
|
|
1,041,158
|
|
1,050,888
|
|
|
|
|||||||
Diluted
|
1,030,404
|
|
1,041,138
|
|
1,041,879
|
|
1,047,746
|
|
1,056,818
|
|
|
|
|||||||
|
|
|
|
|
|
|
|
||||||||||||
Period end:
|
|
|
|
|
|
|
|
||||||||||||
Full-time employees
|
52,500
|
|
52,900
|
|
52,800
|
|
52,600
|
|
52,000
|
|
|
|
|||||||
Book value per common share – GAAP
(d)
|
$
|
37.21
|
|
$
|
36.11
|
|
$
|
35.26
|
|
$
|
34.23
|
|
$
|
33.67
|
|
|
|
||
Tangible book value per common share – Non-GAAP
(d)
|
$
|
18.24
|
|
$
|
18.19
|
|
$
|
17.53
|
|
$
|
16.65
|
|
$
|
16.19
|
|
|
|
||
Cash dividends per common share
|
$
|
0.24
|
|
$
|
0.24
|
|
$
|
0.19
|
|
$
|
0.19
|
|
$
|
0.19
|
|
|
|
||
Common dividend payout ratio
|
22
|
%
|
26
|
%
|
22
|
%
|
23
|
%
|
25
|
%
|
|
|
|||||||
Closing stock price per common share
|
$
|
53.86
|
|
$
|
53.02
|
|
$
|
51.02
|
|
$
|
47.23
|
|
$
|
47.38
|
|
|
|
||
Market capitalization
|
$
|
54,584
|
|
$
|
54,294
|
|
$
|
52,712
|
|
$
|
49,113
|
|
$
|
49,630
|
|
|
|
||
Common shares outstanding
|
1,013,442
|
|
1,024,022
|
|
1,033,156
|
|
1,039,877
|
|
1,047,488
|
|
|
|
(b)
|
Operating leverage is the rate of increase (decrease) in total revenue less the rate of increase (decrease) in total noninterest expense. See “Supplemental information – Explanation of GAAP and Non-GAAP financial measures” beginning on page
23
for the components of this measure.
|
(c)
|
Non-GAAP information for all periods presented excludes the net income attributable to noncontrolling interests related to consolidated investment management funds, amortization of intangible assets and M&I, litigation and restructuring charges. See “Supplemental information – Explanation of GAAP and Non-GAAP financial measures” beginning on page
23
for the reconciliation of Non-GAAP measures.
|
(d)
|
Tangible book value per common share
–
Non-GAAP and tangible common equity exclude goodwill and intangible assets, net of deferred tax liabilities, which, at Dec. 31, 2017, have been remeasured at the lower statutory corporate tax rate. See “Supplemental information – Explanation of GAAP and Non-GAAP financial measures” beginning on page
23
for the reconciliation of Non-GAAP measures.
|
Page -
4
|
BNY Mellon 4Q17 Earnings Release
|
Key market metrics
|
|
|
|
|
|
4Q17 vs.
|
|||||||||||||
|
4Q17
|
|
3Q17
|
|
2Q17
|
|
1Q17
|
|
4Q16
|
|
3Q17
|
|
4Q16
|
|
|||||
Standard & Poor’s (“S&P”) 500 Index
(a)
|
2674
|
|
2519
|
|
2423
|
|
2363
|
|
2239
|
|
6
|
%
|
19
|
%
|
|||||
S&P 500 Index – daily average
|
2603
|
|
2467
|
|
2398
|
|
2326
|
|
2185
|
|
6
|
|
19
|
|
|||||
FTSE 100 Index
(a)
|
7688
|
|
7373
|
|
7313
|
|
7323
|
|
7143
|
|
4
|
|
8
|
|
|||||
FTSE 100 Index – daily average
|
7477
|
|
7380
|
|
7391
|
|
7274
|
|
6923
|
|
1
|
|
8
|
|
|||||
MSCI EAFE
(a)
|
2051
|
|
1974
|
|
1883
|
|
1793
|
|
1684
|
|
4
|
|
22
|
|
|||||
MSCI EAFE – daily average
|
2005
|
|
1934
|
|
1856
|
|
1749
|
|
1660
|
|
4
|
|
21
|
|
|||||
Barclays Capital Global Aggregate Bond
SM
Index
(a)(b)
|
485
|
|
480
|
|
471
|
|
459
|
|
451
|
|
1
|
|
8
|
|
|||||
NYSE and NASDAQ share volume
(in billions)
|
188
|
|
179
|
|
199
|
|
186
|
|
189
|
|
5
|
|
(1
|
)
|
|||||
JPMorgan G7 Volatility Index – daily average
(c)
|
7.41
|
|
8.17
|
|
7.98
|
|
10.10
|
|
10.24
|
|
(9
|
)
|
(28
|
)
|
|||||
Average interest on excess reserves paid by the Federal Reserve
|
1.30
|
%
|
1.25
|
%
|
1.04
|
%
|
0.79
|
%
|
0.55
|
%
|
5
|
bps
|
75
|
bps
|
|||||
Foreign exchange rates vs. U.S. dollar:
|
|
|
|
|
|
|
|
||||||||||||
British pound
(a)
|
$
|
1.35
|
|
$
|
1.34
|
|
$
|
1.30
|
|
$
|
1.25
|
|
$
|
1.23
|
|
1
|
%
|
10
|
%
|
British pound – average rate
|
1.33
|
|
1.31
|
|
1.28
|
|
1.24
|
|
1.24
|
|
2
|
|
7
|
|
|||||
Euro
(a)
|
1.20
|
|
1.18
|
|
1.14
|
|
1.07
|
|
1.05
|
|
2
|
|
14
|
|
|||||
Euro – average rate
|
1.18
|
|
1.17
|
|
1.10
|
|
1.07
|
|
1.08
|
|
1
|
|
9
|
|
(a)
|
Period end.
|
(b)
|
Unhedged in U.S. dollar terms.
|
(c)
|
The JPMorgan G7 Volatility Index is based on the implied volatility in 3-month currency options.
|
Page -
5
|
BNY Mellon 4Q17 Earnings Release
|
Fee and other revenue
|
|
|
|
|
|
4Q17 vs.
|
|||||||||||||
(dollars in millions)
|
4Q17
|
|
3Q17
|
|
2Q17
|
|
1Q17
|
|
4Q16
|
|
3Q17
|
|
4Q16
|
|
|||||
Investment services fees:
|
|
|
|
|
|
|
|
||||||||||||
Asset servicing
(a)
|
$
|
1,130
|
|
$
|
1,105
|
|
$
|
1,085
|
|
$
|
1,063
|
|
$
|
1,068
|
|
2
|
%
|
6
|
%
|
Clearing services
|
400
|
|
383
|
|
394
|
|
376
|
|
355
|
|
4
|
|
13
|
|
|||||
Issuer services
|
197
|
|
288
|
|
241
|
|
251
|
|
211
|
|
(32
|
)
|
(7
|
)
|
|||||
Treasury services
|
137
|
|
141
|
|
140
|
|
139
|
|
140
|
|
(3
|
)
|
(2
|
)
|
|||||
Total investment services fees
|
1,864
|
|
1,917
|
|
1,860
|
|
1,829
|
|
1,774
|
|
(3
|
)
|
5
|
|
|||||
Investment management and performance fees
|
962
|
|
901
|
|
879
|
|
842
|
|
848
|
|
7
|
|
13
|
|
|||||
Foreign exchange and other trading revenue
|
166
|
|
173
|
|
165
|
|
164
|
|
161
|
|
(4
|
)
|
3
|
|
|||||
Financing-related fees
|
54
|
|
54
|
|
53
|
|
55
|
|
50
|
|
—
|
|
8
|
|
|||||
Distribution and servicing
|
38
|
|
40
|
|
41
|
|
41
|
|
41
|
|
(5
|
)
|
(7
|
)
|
|||||
Investment and other (loss) income
|
(198
|
)
|
63
|
|
122
|
|
77
|
|
70
|
|
N/M
|
N/M
|
|||||||
Total fee revenue
|
2,886
|
|
3,148
|
|
3,120
|
|
3,008
|
|
2,944
|
|
(8
|
)
|
(2
|
)
|
|||||
Net securities (losses) gains
|
(26
|
)
|
19
|
|
—
|
|
10
|
|
10
|
|
N/M
|
N/M
|
|||||||
Total fee and other revenue
|
$
|
2,860
|
|
$
|
3,167
|
|
$
|
3,120
|
|
$
|
3,018
|
|
$
|
2,954
|
|
(10
|
)%
|
(3
|
)%
|
(a)
|
Asset servicing fees include securities lending revenue of
$51 million
in
4Q17
,
$47 million
in
3Q17
,
$48 million
in
2Q17
,
$49 million
in
1Q17
and
$54 million
in
4Q16
.
|
•
|
Asset servicing fees increased
6%
year-over-year and
2%
sequentially.
The year-over-year increase primarily reflects higher equity market values, net new business, including growth in collateral management, and the favorable impact of the weaker U.S. dollar.
The sequential increase was primarily driven by net new business, securities lending, equity market values and money market fees.
|
•
|
Clearing services fees increased
13%
year-over-year and
4%
sequentially. The year-over-year increase primarily reflects
higher money market fees and growth in long-term mutual fund assets.
Both increases also reflect
termination fees due to lost business recorded in 4Q17
.
|
•
|
Issuer services fees decreased
7%
year-over-year primarily reflecting
lower volumes, fewer corporate actions and lower fees due to a reduction in shares outstanding in certain Depositary Receipts programs, partially offset by higher Corporate Trust revenue
. The
32%
sequential decrease primarily reflects
seasonality in Depositary Receipts revenue
.
|
•
|
Treasury services fees decreased
2%
year-over-year and
3%
sequentially, primarily reflecting
higher compensating balance credits provided to clients, which reduced fee revenue and increased net interest revenue, partially offset by higher payment volumes.
|
•
|
Investment management and performance fees increased
13%
year-over-year and
7%
sequentially, primarily reflecting higher equity market values, money market fees and performance fees. The year-over-year increase also reflects the favorable impact of a weaker U.S. dollar (principally versus the British pound). On a constant currency basis (Non-GAAP), investment management and performance fees increased
11%
compared with 4Q16.
|
Page -
6
|
BNY Mellon 4Q17 Earnings Release
|
•
|
Foreign exchange and other trading revenue
|
|
|
|
|
|
||||||||||
|
(in millions)
|
4Q17
|
|
3Q17
|
|
2Q17
|
|
1Q17
|
|
4Q16
|
|
|||||
|
Foreign exchange
|
$
|
175
|
|
$
|
158
|
|
$
|
151
|
|
$
|
154
|
|
$
|
175
|
|
|
Other trading (loss) revenue
|
(9
|
)
|
15
|
|
14
|
|
10
|
|
(14
|
)
|
|||||
|
Total foreign exchange and other trading revenue
|
$
|
166
|
|
$
|
173
|
|
$
|
165
|
|
$
|
164
|
|
$
|
161
|
|
•
|
Financing-related fees increased
8%
year-over-year primarily reflecting higher underwriting fees.
|
•
|
Investment and other (loss) income
|
|
|
|
|
|
||||||||||
|
(in millions)
|
4Q17
|
|
3Q17
|
|
2Q17
|
|
1Q17
|
|
4Q16
|
|
|||||
|
Corporate/bank-owned life insurance
|
$
|
43
|
|
$
|
37
|
|
$
|
43
|
|
$
|
30
|
|
$
|
53
|
|
|
Expense reimbursements from joint venture
|
15
|
|
18
|
|
17
|
|
14
|
|
15
|
|
|||||
|
Seed capital gains
(a)
|
7
|
|
6
|
|
10
|
|
9
|
|
6
|
|
|||||
|
Lease-related gains (losses)
|
4
|
|
—
|
|
51
|
|
1
|
|
(6
|
)
|
|||||
|
Equity investment income (loss)
|
4
|
|
—
|
|
7
|
|
26
|
|
(2
|
)
|
|||||
|
Asset-related gains (losses)
|
—
|
|
1
|
|
(5
|
)
|
3
|
|
1
|
|
|||||
|
Other (loss) income
|
(271
|
)
|
1
|
|
(1
|
)
|
(6
|
)
|
3
|
|
|||||
|
Total investment and other (loss) income
|
$
|
(198
|
)
|
$
|
63
|
|
$
|
122
|
|
$
|
77
|
|
$
|
70
|
|
(a)
|
Excludes the gain (loss) on seed capital investments in consolidated investment management funds which are reflected in operations of consolidated investment management funds, net of noncontrolling interests. The gain on seed capital investments in consolidated investment management funds was
$8 million
in
4Q17
,
$7 million
in
3Q17
,
$7 million
in
2Q17
,
$15 million
in
1Q17
and
$1 million
in
4Q16
.
|
•
|
Net securities losses were $26 million in 4Q17, driven by losses of $37 million on the sale of certain investment securities.
|
Page -
7
|
BNY Mellon 4Q17 Earnings Release
|
Net interest revenue
|
|
|
|
|
|
4Q17 vs.
|
|||||||||||||
(dollars in millions)
|
4Q17
|
|
3Q17
|
|
2Q17
|
|
1Q17
|
|
4Q16
|
|
3Q17
|
|
4Q16
|
|
|||||
Net interest revenue
|
$
|
851
|
|
$
|
839
|
|
$
|
826
|
|
$
|
792
|
|
$
|
831
|
|
1
|
%
|
2
|
%
|
Tax equivalent adjustment
|
11
|
|
12
|
|
12
|
|
12
|
|
12
|
|
N/M
|
N/M
|
|||||||
Net interest revenue (FTE) – Non-GAAP
(a)
|
$
|
862
|
|
$
|
851
|
|
$
|
838
|
|
$
|
804
|
|
$
|
843
|
|
1
|
%
|
2
|
%
|
|
|
|
|
|
|
|
|
||||||||||||
Net interest margin
|
1.14
|
%
|
1.15
|
%
|
1.14
|
%
|
1.13
|
%
|
1.16
|
%
|
(1
|
) bps
|
(2
|
) bps
|
|||||
Net interest margin (FTE) – Non-GAAP
(a)
|
1.16
|
%
|
1.16
|
%
|
1.16
|
%
|
1.14
|
%
|
1.17
|
%
|
—
|
|
(1
|
) bps
|
|||||
|
|
|
|
|
|
|
|
||||||||||||
Selected average balances:
|
|
|
|
|
|
|
|
||||||||||||
Cash/interbank investments
|
$
|
117,446
|
|
$
|
114,449
|
|
$
|
111,021
|
|
$
|
106,069
|
|
$
|
104,352
|
|
3
|
%
|
13
|
%
|
Trading account securities
|
2,723
|
|
2,359
|
|
2,455
|
|
2,254
|
|
2,288
|
|
15
|
|
19
|
|
|||||
Securities
|
120,225
|
|
119,089
|
|
117,227
|
|
114,786
|
|
117,660
|
|
1
|
|
2
|
|
|||||
Loans
|
56,772
|
|
55,944
|
|
58,793
|
|
60,312
|
|
63,647
|
|
1
|
|
(11
|
)
|
|||||
Interest-earning assets
|
297,166
|
|
291,841
|
|
289,496
|
|
283,421
|
|
287,947
|
|
2
|
|
3
|
|
|||||
Interest-bearing deposits
|
147,763
|
|
142,490
|
|
142,336
|
|
139,820
|
|
145,681
|
|
4
|
|
1
|
|
|||||
Noninterest-bearing deposits
|
69,111
|
|
70,168
|
|
73,886
|
|
73,555
|
|
82,267
|
|
(2
|
)
|
(16
|
)
|
|||||
Long-term debt
|
28,245
|
|
28,138
|
|
27,398
|
|
25,882
|
|
24,986
|
|
—
|
|
13
|
|
|||||
|
|
|
|
|
|
|
|
||||||||||||
Selected average yields/rates:
(b)
|
|
|
|
|
|
|
|
||||||||||||
Cash/interbank investments
|
0.98
|
%
|
0.84
|
%
|
0.67
|
%
|
0.56
|
%
|
0.47
|
%
|
|
|
|||||||
Trading account securities
|
2.02
|
|
2.26
|
|
2.85
|
|
3.12
|
|
3.17
|
|
|
|
|||||||
Securities
|
1.85
|
|
1.80
|
|
1.72
|
|
1.71
|
|
1.67
|
|
|
|
|||||||
Loans
|
2.60
|
|
2.63
|
|
2.44
|
|
2.15
|
|
1.92
|
|
|
|
|||||||
Interest-earning assets
|
1.65
|
|
1.59
|
|
1.47
|
|
1.38
|
|
1.30
|
|
|
|
|||||||
Interest-bearing deposits
|
0.17
|
|
0.16
|
|
0.09
|
|
0.03
|
|
(0.01
|
)
|
|
|
|||||||
Long-term debt
|
2.29
|
|
2.07
|
|
1.87
|
|
1.85
|
|
1.36
|
|
|
|
|||||||
|
|
|
|
|
|
|
|
||||||||||||
Average cash/interbank investments as a percentage of average interest-earning assets
|
40
|
%
|
39
|
%
|
38
|
%
|
37
|
%
|
36
|
%
|
|
|
|||||||
Average noninterest-bearing deposits as a percentage of average interest-earning assets
|
23
|
%
|
24
|
%
|
26
|
%
|
26
|
%
|
29
|
%
|
|
|
(a)
|
Net interest revenue (FTE) – Non-GAAP and net interest margin (FTE) – Non-GAAP include the tax equivalent adjustments on tax-exempt income which allows for comparisons of amounts arising from both taxable and tax-exempt sources and is consistent with industry practice. The adjustment to an FTE basis has no impact on net income.
|
(b)
|
Yields/rates include the impact of interest rate hedging activities.
|
•
|
Net interest revenue increased
2%
year-over-year and
1%
sequentially. The year-over-year increase primarily reflects higher interest rates, partially offset by
lower average deposits and loans as well as the impact of interest rate hedging activities and leasing.
The sequential increase primarily reflects higher interest rates and higher average deposits, partially offset by leasing-related adjustments. Net interest revenue in 4Q17 was negatively impacted by $15 million for leasing-related adjustments (including $4 million related to the impact of U.S. tax legislation). Net interest revenue in 4Q16 was positively impacted by $25 million of interest rate hedging activities and a $15 million premium amortization adjustment.
|
Page -
8
|
BNY Mellon 4Q17 Earnings Release
|
Noninterest expense
|
|
|
|
|
|
4Q17 vs.
|
|||||||||||||
(dollars in millions)
|
4Q17
|
|
3Q17
|
|
2Q17
|
|
1Q17
|
|
4Q16
|
|
3Q17
|
|
4Q16
|
|
|||||
Staff
|
$
|
1,614
|
|
$
|
1,469
|
|
$
|
1,417
|
|
$
|
1,472
|
|
$
|
1,395
|
|
10
|
%
|
16
|
%
|
Professional, legal and other purchased services
|
338
|
|
305
|
|
319
|
|
312
|
|
325
|
|
11
|
|
4
|
|
|||||
Software and equipment
|
297
|
|
233
|
|
232
|
|
223
|
|
237
|
|
27
|
|
25
|
|
|||||
Net occupancy
|
153
|
|
141
|
|
139
|
|
136
|
|
153
|
|
9
|
|
—
|
|
|||||
Distribution and servicing
|
106
|
|
109
|
|
104
|
|
100
|
|
98
|
|
(3
|
)
|
8
|
|
|||||
Sub-custodian
|
59
|
|
62
|
|
65
|
|
64
|
|
57
|
|
(5
|
)
|
4
|
|
|||||
Business development
|
66
|
|
49
|
|
63
|
|
51
|
|
71
|
|
35
|
|
(7
|
)
|
|||||
Bank assessment charges
|
53
|
|
51
|
|
59
|
|
57
|
|
53
|
|
4
|
|
—
|
|
|||||
Other
|
188
|
|
177
|
|
192
|
|
167
|
|
175
|
|
6
|
|
7
|
|
|||||
Amortization of intangible assets
|
52
|
|
52
|
|
53
|
|
52
|
|
60
|
|
—
|
|
(13
|
)
|
|||||
M&I, litigation and restructuring charges
|
80
|
|
6
|
|
12
|
|
8
|
|
7
|
|
N/M
|
N/M
|
|||||||
Total noninterest expense – GAAP
|
$
|
3,006
|
|
$
|
2,654
|
|
$
|
2,655
|
|
$
|
2,642
|
|
$
|
2,631
|
|
13
|
%
|
14
|
%
|
|
|
|
|
|
|
|
|
||||||||||||
Staff expense as a percentage of total revenue
|
43
|
%
|
37
|
%
|
36
|
%
|
38
|
%
|
37
|
%
|
|
|
|||||||
|
|
|
|
|
|
|
|
||||||||||||
Memo:
|
|
|
|
|
|
|
|
||||||||||||
Adjusted total noninterest expense excluding amortization of intangible assets and M&I, litigation and restructuring charges – Non-GAAP
|
$
|
2,874
|
|
$
|
2,596
|
|
$
|
2,590
|
|
$
|
2,582
|
|
$
|
2,564
|
|
11
|
%
|
12
|
%
|
•
|
Total noninterest expense increased
14%
year-over-year and
13%
sequentially. Total noninterest expense in 4Q17 includes
$282 million
for severance, litigation and an asset impairment, which increased the year-over-year and sequential noninterest expense growth by 11%.
|
•
|
Both the year-over-year and sequential increases primarily reflect higher staff, litigation, software and equipment and professional, legal and other purchased services expenses. The year-over-year increase also reflects the unfavorable impact of the weaker U.S. dollar.
|
•
|
Staff expense reflects higher severance expense. Year-over-year, staff expense also reflects higher incentives, driven by stronger performance.
|
•
|
Software and equipment and professional, legal and other purchased services expenses primarily reflect an asset impairment recorded in 4Q17.
|
•
|
The sequential increase also reflects seasonally higher business development expense and higher net occupancy expense, driven by the cost to exit leased space.
|
Page -
9
|
BNY Mellon 4Q17 Earnings Release
|
Investment securities
portfolio
(dollars in millions)
|
Sept. 30, 2017
|
|
|
4Q17
change in
unrealized
gain (loss)
|
|
Dec. 31, 2017
|
Fair value
as a % of amortized
cost
(a)
|
|
Unrealized
gain (loss)
|
|
|
Ratings
(b)
|
||||||||||||||||||
|
|
|
|
BB+
and
lower
|
|
|||||||||||||||||||||||||
Fair
value
|
|
|
Amortized
cost
|
|
Fair
value
|
|
|
|
AAA/
AA-
|
A+/
A-
|
BBB+/
BBB-
|
Not
rated
|
||||||||||||||||||
Agency RMBS
|
$
|
49,917
|
|
|
$
|
(260
|
)
|
$
|
50,210
|
|
$
|
49,746
|
|
|
99
|
%
|
$
|
(464
|
)
|
|
100
|
%
|
—
|
%
|
—
|
%
|
—
|
%
|
—
|
%
|
U.S. Treasury
|
25,159
|
|
|
(6
|
)
|
24,951
|
|
24,848
|
|
|
100
|
|
(103
|
)
|
|
100
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||
Sovereign debt/sovereign guaranteed
|
14,102
|
|
|
(21
|
)
|
13,998
|
|
14,128
|
|
|
101
|
|
130
|
|
|
72
|
|
6
|
|
21
|
|
1
|
|
—
|
|
|||||
Non-agency RMBS
(c)
|
1,185
|
|
|
(20
|
)
|
811
|
|
1,091
|
|
|
85
|
|
280
|
|
|
—
|
|
1
|
|
3
|
|
85
|
|
11
|
|
|||||
Non-agency RMBS
|
594
|
|
|
(1
|
)
|
511
|
|
549
|
|
|
98
|
|
38
|
|
|
7
|
|
4
|
|
21
|
|
67
|
|
1
|
|
|||||
European floating rate notes
|
387
|
|
|
2
|
|
275
|
|
271
|
|
|
97
|
|
(4
|
)
|
|
49
|
|
51
|
|
—
|
|
—
|
|
—
|
|
|||||
Commercial MBS
|
11,033
|
|
|
(13
|
)
|
11,425
|
|
11,394
|
|
|
100
|
|
(31
|
)
|
|
99
|
|
1
|
|
—
|
|
—
|
|
—
|
|
|||||
State and political subdivisions
|
3,141
|
|
|
(25
|
)
|
2,966
|
|
2,973
|
|
|
100
|
|
7
|
|
|
80
|
|
17
|
|
—
|
|
—
|
|
3
|
|
|||||
Foreign covered bonds
|
2,626
|
|
|
(3
|
)
|
2,604
|
|
2,615
|
|
|
100
|
|
11
|
|
|
100
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||
Corporate bonds
|
1,275
|
|
|
(7
|
)
|
1,249
|
|
1,255
|
|
|
101
|
|
6
|
|
|
17
|
|
69
|
|
14
|
|
—
|
|
—
|
|
|||||
CLOs
|
2,550
|
|
|
3
|
|
2,898
|
|
2,909
|
|
|
100
|
|
11
|
|
|
98
|
|
—
|
|
—
|
|
1
|
|
1
|
|
|||||
U.S. Government agencies
|
2,496
|
|
|
17
|
|
2,570
|
|
2,603
|
|
|
101
|
|
33
|
|
|
100
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||
Consumer ABS
|
1,157
|
|
|
(2
|
)
|
1,040
|
|
1,043
|
|
|
100
|
|
3
|
|
|
93
|
|
—
|
|
5
|
|
2
|
|
—
|
|
|||||
Other
(d)
|
4,122
|
|
|
(6
|
)
|
4,485
|
|
4,483
|
|
|
100
|
|
(2
|
)
|
|
82
|
|
16
|
|
—
|
|
—
|
|
2
|
|
|||||
Total investment securities
|
$
|
119,744
|
|
(e)
|
$
|
(342
|
)
|
$
|
119,993
|
|
$
|
119,908
|
|
(e)
|
99
|
%
|
$
|
(85
|
)
|
(e)(f)
|
93
|
%
|
3
|
%
|
3
|
%
|
1
|
%
|
—
|
%
|
(b)
|
Represents ratings by S&P, or the equivalent.
|
(c)
|
These RMBS were included in the former Grantor Trust and were marked-to-market in 2009. We believe these RMBS would receive higher credit ratings if these ratings incorporated, as additional credit enhancements, the difference between the written-down amortized cost and the current face amount of each of these securities.
|
(d)
|
Includes commercial paper with a fair value of
$700 million
and
$700 million
and money market funds with a fair value of
$939 million
and
$963 million
at
Sept. 30, 2017
and
Dec. 31, 2017
, respectively.
|
(e)
|
Includes net unrealized losses on derivatives hedging securities available-for-sale of
$238 million
at
Sept. 30, 2017
and
$147 million
at
Dec. 31, 2017
.
|
(f)
|
Unrealized gains of
$230 million
at
Dec. 31, 2017
related to available-for-sale securities, net of hedges.
|
Page -
10
|
BNY Mellon 4Q17 Earnings Release
|
Nonperforming assets
(dollars in millions)
|
Dec. 31, 2017
|
|
Sept. 30, 2017
|
|
Dec. 31, 2016
|
|
|||
Nonperforming loans:
|
|
|
|
||||||
Other residential mortgages
|
$
|
78
|
|
$
|
80
|
|
$
|
91
|
|
Wealth management loans and mortgages
|
7
|
|
8
|
|
8
|
|
|||
Commercial real estate
|
1
|
|
—
|
|
—
|
|
|||
Financial institutions
|
—
|
|
2
|
|
—
|
|
|||
Lease financing
|
—
|
|
—
|
|
4
|
|
|||
Total nonperforming loans
|
86
|
|
90
|
|
103
|
|
|||
Other assets owned
|
4
|
|
4
|
|
4
|
|
|||
Total nonperforming assets
|
$
|
90
|
|
$
|
94
|
|
$
|
107
|
|
Nonperforming assets ratio
|
0.15
|
%
|
0.16
|
%
|
0.17
|
%
|
|||
Allowance for loan losses/nonperforming loans
|
184.9
|
|
178.9
|
|
164.1
|
|
|||
Total allowance for credit losses/nonperforming loans
|
303.5
|
|
294.4
|
|
272.8
|
|
Allowance for credit losses, provision and net recoveries
(in millions)
|
Dec. 31, 2017
|
|
Sept. 30, 2017
|
|
Dec. 31, 2016
|
|
|||
Allowance for credit losses - beginning of period
|
$
|
265
|
|
$
|
270
|
|
$
|
274
|
|
Provision for credit losses
|
(6
|
)
|
(6
|
)
|
7
|
|
|||
Net recoveries:
|
|
|
|
||||||
Other residential mortgages
|
2
|
|
1
|
|
—
|
|
|||
Financial institutions
|
—
|
|
—
|
|
—
|
|
|||
Net recoveries
|
2
|
|
1
|
|
—
|
|
|||
Allowance for credit losses - end of period
|
$
|
261
|
|
$
|
265
|
|
$
|
281
|
|
Allowance for loan losses
|
$
|
159
|
|
$
|
161
|
|
$
|
169
|
|
Allowance for lending-related commitments
|
102
|
|
104
|
|
112
|
|
Page -
11
|
BNY Mellon 4Q17 Earnings Release
|
Capital ratios
|
Dec. 31, 2017
|
|
Sept. 30, 2017
|
|
Dec. 31, 2016
|
|
Consolidated regulatory capital ratios:
(a)
|
|
|
|
|||
Standardized Approach:
|
|
|
|
|||
CET1 ratio
|
12.0
|
%
|
12.3
|
%
|
12.3
|
%
|
Tier 1 capital ratio
|
14.2
|
|
14.6
|
|
14.5
|
|
Total (Tier 1 plus Tier 2) capital ratio
|
15.1
|
|
15.6
|
|
15.2
|
|
Advanced Approach:
|
|
|
|
|
|
|
CET1 ratio
|
10.7
|
|
11.1
|
|
10.6
|
|
Tier 1 capital ratio
|
12.7
|
|
13.2
|
|
12.6
|
|
Total (Tier 1 plus Tier 2) capital ratio
|
13.4
|
|
14.0
|
|
13.0
|
|
Leverage capital ratio
(b)
|
6.6
|
|
6.8
|
|
6.6
|
|
Supplementary leverage ratio (“SLR”)
|
6.1
|
|
6.3
|
|
6.0
|
|
BNY Mellon shareholders’ equity to total assets ratio
|
11.1
|
|
11.4
|
|
11.6
|
|
BNY Mellon common shareholders’ equity to total assets ratio
|
10.1
|
|
10.4
|
|
10.6
|
|
|
|
|
|
|||
Selected regulatory capital ratios – fully phased-in – Non-GAAP:
(a)(c)
|
|
|
|
|||
CET1 ratio:
|
|
|
|
|||
Standardized Approach
|
11.5
|
%
|
11.9
|
%
|
11.3
|
%
|
Advanced Approach
|
10.3
|
|
10.7
|
|
9.7
|
|
SLR
|
5.9
|
|
6.1
|
|
5.6
|
|
(a)
|
Regulatory capital ratios for
Dec. 31, 2017
are preliminary. For our CET1, Tier 1 capital and Total capital ratios, our effective capital ratios under the U.S. capital rules are the lower of the ratios as calculated under the Standardized and Advanced Approaches.
|
(b)
|
The leverage capital ratio is based on Tier 1 capital, as phased-in and quarterly average total assets.
|
(c)
|
Estimated.
|
CET1 generation in 4Q17 – preliminary
|
Transitional
basis
(b)
|
|
Fully
phased-in
–
Non-GAAP
(c)
|
|
||
|
||||||
(in millions)
|
||||||
CET1 – Beginning of period
|
$
|
18,870
|
|
$
|
18,141
|
|
Net income applicable to common shareholders of The Bank of New York Mellon Corporation – GAAP
|
1,126
|
|
1,126
|
|
||
Goodwill and intangible assets, net of related deferred tax liabilities
|
(808
|
)
|
(872
|
)
|
||
Gross CET1 generated
|
318
|
|
254
|
|
||
Capital deployed:
|
|
|
||||
Dividends
|
(248
|
)
|
(248
|
)
|
||
Common stock repurchased
|
(651
|
)
|
(651
|
)
|
||
Total capital deployed
|
(899
|
)
|
(899
|
)
|
||
Other comprehensive income
|
360
|
|
424
|
|
||
Additional paid-in capital
(a)
|
77
|
|
77
|
|
||
Other
|
(133
|
)
|
(159
|
)
|
||
Total other additions
|
304
|
|
342
|
|
||
Net CET1 deployed
|
(277
|
)
|
(303
|
)
|
||
CET1 – End of period
|
$
|
18,593
|
|
$
|
17,838
|
|
Page -
12
|
BNY Mellon 4Q17 Earnings Release
|
Basel III capital components and ratios
|
Dec. 31, 2017
(a)
|
|
Sept. 30, 2017
|
|
Dec. 31, 2016
|
|||||||||||||||
(dollars in millions)
|
Transitional
basis (b) |
|
Fully
phased-in – Non-GAAP (c) |
|
|
Transitional
basis
(b)
|
|
Fully
phased-in
–
Non-GAAP
(c)
|
|
|
Transitional
basis
(b)
|
|
Fully
phased-in
–
Non-GAAP
(c)
|
|
||||||
CET1:
|
|
|
|
|
|
|
|
|
||||||||||||
Common shareholders’ equity
|
$
|
37,859
|
|
$
|
37,709
|
|
|
$
|
37,195
|
|
$
|
36,981
|
|
|
$
|
35,794
|
|
$
|
35,269
|
|
Goodwill and intangible assets
|
(18,684
|
)
|
(19,223
|
)
|
|
(17,876
|
)
|
(18,351
|
)
|
|
(17,314
|
)
|
(18,312
|
)
|
||||||
Net pension fund assets
|
(169
|
)
|
(211
|
)
|
|
(72
|
)
|
(90
|
)
|
|
(55
|
)
|
(90
|
)
|
||||||
Equity method investments
|
(372
|
)
|
(387
|
)
|
|
(334
|
)
|
(348
|
)
|
|
(313
|
)
|
(344
|
)
|
||||||
Deferred tax assets
|
(33
|
)
|
(41
|
)
|
|
(31
|
)
|
(39
|
)
|
|
(19
|
)
|
(32
|
)
|
||||||
Other
|
(8
|
)
|
(9
|
)
|
|
(12
|
)
|
(12
|
)
|
|
—
|
|
(1
|
)
|
||||||
Total CET1
|
18,593
|
|
17,838
|
|
|
18,870
|
|
18,141
|
|
|
18,093
|
|
16,490
|
|
||||||
Other Tier 1 capital:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Preferred stock
|
3,542
|
|
3,542
|
|
|
3,542
|
|
3,542
|
|
|
3,542
|
|
3,542
|
|
||||||
Deferred tax assets
|
(8
|
)
|
—
|
|
|
(8
|
)
|
—
|
|
|
(13
|
)
|
—
|
|
||||||
Net pension fund assets
|
(42
|
)
|
—
|
|
|
(19
|
)
|
—
|
|
|
(36
|
)
|
—
|
|
||||||
Other
|
(41
|
)
|
(41
|
)
|
|
(34
|
)
|
(34
|
)
|
|
(121
|
)
|
(121
|
)
|
||||||
Total Tier 1 capital
|
22,044
|
|
21,339
|
|
|
22,351
|
|
21,649
|
|
|
21,465
|
|
19,911
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Tier 2 capital:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Subordinated debt
|
1,250
|
|
1,250
|
|
|
1,300
|
|
1,250
|
|
|
550
|
|
550
|
|
||||||
Allowance for credit losses
|
261
|
|
261
|
|
|
265
|
|
265
|
|
|
281
|
|
281
|
|
||||||
Trust preferred securities
|
—
|
|
—
|
|
|
—
|
|
—
|
|
|
148
|
|
—
|
|
||||||
Other
|
(12
|
)
|
(12
|
)
|
|
(7
|
)
|
(7
|
)
|
|
(12
|
)
|
(11
|
)
|
||||||
Total Tier 2 capital - Standardized Approach
|
1,499
|
|
1,499
|
|
|
1,558
|
|
1,508
|
|
|
967
|
|
820
|
|
||||||
Excess of expected credit losses
|
33
|
|
33
|
|
|
49
|
|
49
|
|
|
50
|
|
50
|
|
||||||
Less: Allowance for credit losses
|
261
|
|
261
|
|
|
265
|
|
265
|
|
|
281
|
|
281
|
|
||||||
Total Tier 2 capital - Advanced Approach
|
$
|
1,271
|
|
$
|
1,271
|
|
|
$
|
1,342
|
|
$
|
1,292
|
|
|
$
|
736
|
|
$
|
589
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total capital:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Standardized Approach
|
$
|
23,543
|
|
$
|
22,838
|
|
|
$
|
23,909
|
|
$
|
23,157
|
|
|
$
|
22,432
|
|
$
|
20,731
|
|
Advanced Approach
|
$
|
23,315
|
|
$
|
22,610
|
|
|
$
|
23,693
|
|
$
|
22,941
|
|
|
$
|
22,201
|
|
$
|
20,500
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Risk-weighted assets:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Standardized Approach
|
$
|
155,498
|
|
$
|
155,309
|
|
|
$
|
153,494
|
|
$
|
152,995
|
|
|
$
|
147,671
|
|
$
|
146,475
|
|
Advanced Approach
|
$
|
174,117
|
|
$
|
173,916
|
|
|
$
|
169,822
|
|
$
|
169,293
|
|
|
$
|
170,495
|
|
$
|
169,227
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Standardized Approach:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
CET1 ratio
|
12.0
|
%
|
11.5
|
%
|
|
12.3
|
%
|
11.9
|
%
|
|
12.3
|
%
|
11.3
|
%
|
||||||
Tier 1 capital ratio
|
14.2
|
|
13.7
|
|
|
14.6
|
|
14.2
|
|
|
14.5
|
|
13.6
|
|
||||||
Total (Tier 1 plus Tier 2) capital ratio
|
15.1
|
|
14.7
|
|
|
15.6
|
|
15.1
|
|
|
15.2
|
|
14.2
|
|
||||||
Advanced Approach:
|
|
|
|
|
|
|
|
|
||||||||||||
CET1 ratio
|
10.7
|
%
|
10.3
|
%
|
|
11.1
|
%
|
10.7
|
%
|
|
10.6
|
%
|
9.7
|
%
|
||||||
Tier 1 capital ratio
|
12.7
|
|
12.3
|
|
|
13.2
|
|
12.8
|
|
|
12.6
|
|
11.8
|
|
||||||
Total (Tier 1 plus Tier 2) capital ratio
|
13.4
|
|
13.0
|
|
|
14.0
|
|
13.6
|
|
|
13.0
|
|
12.1
|
|
Page -
13
|
BNY Mellon 4Q17 Earnings Release
|
SLR
|
Dec. 31, 2017
(a)
|
|
Sept. 30, 2017
|
|
Dec. 31, 2016
|
|||||||||||||||
(dollars in millions)
|
Transitional
basis |
|
Fully
phased-in – Non-GAAP (b) |
|
|
Transitional basis
|
|
Fully
phased-in – Non-GAAP (b) |
|
|
Transitional basis
|
|
Fully
phased-in
–
Non-GAAP
(b)
|
|
||||||
Consolidated:
|
|
|
|
|
|
|
|
|
||||||||||||
Tier 1 capital
|
$
|
22,044
|
|
$
|
21,339
|
|
|
$
|
22,351
|
|
$
|
21,649
|
|
|
$
|
21,465
|
|
$
|
19,911
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Total leverage exposure:
|
|
|
|
|
|
|
|
|
|
|||||||||||
Quarterly average total assets
|
$
|
350,786
|
|
$
|
350,786
|
|
|
$
|
345,709
|
|
$
|
345,709
|
|
|
$
|
344,142
|
|
$
|
344,142
|
|
Less: Amounts deducted from Tier 1 capital
|
19,186
|
|
19,892
|
|
|
18,154
|
|
18,856
|
|
|
17,333
|
|
18,887
|
|
||||||
Total on-balance sheet assets, as adjusted
|
331,600
|
|
330,894
|
|
|
327,555
|
|
326,853
|
|
|
326,809
|
|
325,255
|
|
||||||
Off-balance sheet exposures:
|
|
|
|
|
|
|
|
|
|
|||||||||||
Potential future exposure for derivative contracts (plus certain other items)
|
6,613
|
|
6,613
|
|
|
6,213
|
|
6,213
|
|
|
6,021
|
|
6,021
|
|
||||||
Repo-style transaction exposures
|
1,086
|
|
1,086
|
|
|
1,034
|
|
1,034
|
|
|
533
|
|
533
|
|
||||||
Credit-equivalent amount of other off-balance sheet exposures (less SLR exclusions)
|
21,959
|
|
21,959
|
|
|
21,860
|
|
21,860
|
|
|
23,274
|
|
23,274
|
|
||||||
Total off-balance sheet exposures
|
29,658
|
|
29,658
|
|
|
29,107
|
|
29,107
|
|
|
29,828
|
|
29,828
|
|
||||||
Total leverage exposure
|
$
|
361,258
|
|
$
|
360,552
|
|
|
$
|
356,662
|
|
$
|
355,960
|
|
|
$
|
356,637
|
|
$
|
355,083
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
SLR - Consolidated
(c)
|
6.1
|
%
|
5.9
|
%
|
|
6.3
|
%
|
6.1
|
%
|
|
6.0
|
%
|
5.6
|
%
|
||||||
|
|
|
|
|
|
|
|
|
||||||||||||
The Bank of New York Mellon, our largest bank subsidiary:
|
|
|
|
|
|
|
|
|
||||||||||||
Tier 1 capital
|
$
|
20,478
|
|
$
|
19,768
|
|
|
$
|
20,718
|
|
$
|
19,955
|
|
|
$
|
19,011
|
|
$
|
17,708
|
|
Total leverage exposure
|
$
|
296,517
|
|
$
|
296,231
|
|
|
$
|
292,759
|
|
$
|
292,421
|
|
|
$
|
291,022
|
|
$
|
290,230
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
SLR - The Bank of New York Mellon
(c)
|
6.9
|
%
|
6.7
|
%
|
|
7.1
|
%
|
6.8
|
%
|
|
6.5
|
%
|
6.1
|
%
|
(a)
|
Preliminary.
|
(b)
|
Estimated.
|
(c)
|
The estimated fully phased-in SLR (Non-GAAP) is based on our interpretation of the U.S. capital rules. When the SLR is fully phased-in in 2018 as a required minimum ratio, we expect to maintain an SLR of over 5%. The minimum required SLR is 3% and there is a 2% buffer, in addition to the minimum, that is applicable to U.S. G-SIBs. The insured depository institution subsidiaries of the U.S. G-SIBs, including those of BNY Mellon, must maintain a 6% SLR to be considered “well capitalized.”
|
Page -
14
|
BNY Mellon 4Q17 Earnings Release
|
(dollars in millions, unless otherwise noted)
|
|
|
|
|
|
|
4Q17 vs.
|
|||||||||||||
4Q17
|
|
|
3Q17
|
|
2Q17
|
|
1Q17
|
|
4Q16
|
|
3Q17
|
4Q16
|
||||||||
Revenue:
|
|
|
|
|
|
|
|
|
||||||||||||
Investment management fees:
|
|
|
|
|
|
|
|
|
||||||||||||
Mutual funds
|
$
|
341
|
|
|
$
|
332
|
|
$
|
314
|
|
$
|
299
|
|
$
|
297
|
|
3
|
%
|
15
|
%
|
Institutional clients
|
378
|
|
|
367
|
|
362
|
|
348
|
|
340
|
|
3
|
|
11
|
|
|||||
Wealth management
|
179
|
|
|
172
|
|
169
|
|
167
|
|
164
|
|
4
|
|
9
|
|
|||||
Investment management fees
(a)
|
898
|
|
|
871
|
|
845
|
|
814
|
|
801
|
|
3
|
|
12
|
|
|||||
Performance fees
|
50
|
|
|
15
|
|
17
|
|
12
|
|
32
|
|
N/M
|
56
|
|
||||||
Investment management and performance fees
|
948
|
|
|
886
|
|
862
|
|
826
|
|
833
|
|
7
|
|
14
|
|
|||||
Distribution and servicing
|
51
|
|
|
51
|
|
53
|
|
52
|
|
48
|
|
—
|
|
6
|
|
|||||
Other
(a)
|
(25
|
)
|
|
(19
|
)
|
(16
|
)
|
(1
|
)
|
(1
|
)
|
N/M
|
N/M
|
|||||||
Total fee and other revenue
(a)
|
974
|
|
|
918
|
|
899
|
|
877
|
|
880
|
|
6
|
|
11
|
|
|||||
Net interest revenue
|
74
|
|
|
82
|
|
87
|
|
86
|
|
80
|
|
(10
|
)
|
(8
|
)
|
|||||
Total revenue
|
1,048
|
|
|
1,000
|
|
986
|
|
963
|
|
960
|
|
5
|
|
9
|
|
|||||
Provision for credit losses
|
1
|
|
|
(2
|
)
|
—
|
|
3
|
|
6
|
|
N/M
|
N/M
|
|||||||
Noninterest expense (ex. amortization of intangible assets)
|
756
|
|
|
687
|
|
683
|
|
668
|
|
672
|
|
10
|
|
13
|
|
|||||
Amortization of intangible assets
|
15
|
|
|
15
|
|
15
|
|
15
|
|
22
|
|
—
|
|
(32
|
)
|
|||||
Total noninterest expense
|
771
|
|
|
702
|
|
698
|
|
683
|
|
694
|
|
10
|
|
11
|
|
|||||
Income before taxes
|
$
|
276
|
|
|
$
|
300
|
|
$
|
288
|
|
$
|
277
|
|
$
|
260
|
|
(8
|
)%
|
6
|
%
|
Income before taxes (ex. amortization of intangible
assets) – Non-GAAP
|
$
|
291
|
|
|
$
|
315
|
|
$
|
303
|
|
$
|
292
|
|
$
|
282
|
|
(8
|
)%
|
3
|
%
|
|
|
|
|
|
|
|
|
|
||||||||||||
Pre-tax operating margin
|
26
|
%
|
|
30
|
%
|
29
|
%
|
29
|
%
|
27
|
%
|
|
|
|||||||
Adjusted pre-tax operating margin – Non-GAAP
(b)
|
31
|
%
|
|
35
|
%
|
34
|
%
|
34
|
%
|
33
|
%
|
|
|
|||||||
|
|
|
|
|
|
|
|
|
||||||||||||
Changes in AUM
(in billions)
:
(c)
|
|
|
|
|
|
|
|
|
||||||||||||
Beginning balance of AUM
|
$
|
1,824
|
|
|
$
|
1,771
|
|
$
|
1,727
|
|
$
|
1,648
|
|
$
|
1,715
|
|
|
|
||
Net inflows (outflows):
|
|
|
|
|
|
|
|
|
||||||||||||
Long-term strategies:
|
|
|
|
|
|
|
|
|
||||||||||||
Equity
|
(6
|
)
|
|
(2
|
)
|
(2
|
)
|
(4
|
)
|
(5
|
)
|
|
|
|||||||
Fixed income
|
(2
|
)
|
|
4
|
|
2
|
|
2
|
|
(1
|
)
|
|
|
|||||||
Liability-driven investments
(d)
|
23
|
|
|
(2
|
)
|
15
|
|
14
|
|
(7
|
)
|
|
|
|||||||
Multi-asset and alternative investments
|
2
|
|
|
3
|
|
1
|
|
2
|
|
3
|
|
|
|
|||||||
Total long-term active strategies inflows (outflows)
|
17
|
|
|
3
|
|
16
|
|
14
|
|
(10
|
)
|
|
|
|||||||
Index
|
(1
|
)
|
|
(3
|
)
|
(13
|
)
|
—
|
|
(1
|
)
|
|
|
|||||||
Total long-term strategies inflows (outflows)
|
16
|
|
|
—
|
|
3
|
|
14
|
|
(11
|
)
|
|
|
|||||||
Short term strategies:
|
|
|
|
|
|
|
|
|
||||||||||||
Cash
|
(4
|
)
|
|
10
|
|
11
|
|
13
|
|
(3
|
)
|
|
|
|||||||
Total net inflows (outflows)
|
12
|
|
|
10
|
|
14
|
|
27
|
|
(14
|
)
|
|
|
|||||||
Net market impact/other
|
47
|
|
|
17
|
|
1
|
|
41
|
|
(11
|
)
|
|
|
|||||||
Net currency impact
|
10
|
|
|
26
|
|
29
|
|
11
|
|
(42
|
)
|
|
|
|||||||
Ending balance of AUM
|
$
|
1,893
|
|
(e)
|
$
|
1,824
|
|
$
|
1,771
|
|
$
|
1,727
|
|
$
|
1,648
|
|
4
|
%
|
15
|
%
|
|
|
|
|
|
|
|
|
|
||||||||||||
AUM at period end, by product type:
(c)
|
|
|
|
|
|
|
|
|
||||||||||||
Equity
|
9
|
%
|
|
9
|
%
|
9
|
%
|
9
|
%
|
9
|
%
|
|
|
|||||||
Fixed income
|
11
|
|
|
11
|
|
11
|
|
11
|
|
11
|
|
|
|
|||||||
Index
|
18
|
|
|
18
|
|
18
|
|
19
|
|
19
|
|
|
|
|||||||
Liability-driven investments
(d)
|
35
|
|
|
35
|
|
35
|
|
34
|
|
34
|
|
|
|
|||||||
Multi-asset and alternative investments
|
11
|
|
|
11
|
|
11
|
|
11
|
|
11
|
|
|
|
|||||||
Cash
|
16
|
|
|
16
|
|
16
|
|
16
|
|
16
|
|
|
|
|||||||
Total AUM
|
100
|
%
|
(e)
|
100
|
%
|
100
|
%
|
100
|
%
|
100
|
%
|
|
|
|||||||
|
|
|
|
|
|
|
|
|
||||||||||||
Average balances:
|
|
|
|
|
|
|
|
|
||||||||||||
Average loans
|
$
|
16,813
|
|
|
$
|
16,724
|
|
$
|
16,560
|
|
$
|
16,153
|
|
$
|
15,673
|
|
1
|
%
|
7
|
%
|
Average deposits
|
$
|
11,633
|
|
|
$
|
12,374
|
|
$
|
14,866
|
|
$
|
15,781
|
|
$
|
15,511
|
|
(6
|
)%
|
(25
|
)%
|
(a)
|
Total fee and other revenue includes the impact of the consolidated investment management funds, net of noncontrolling interests.
See page
27
for a breakdown of the revenue line items in the Investment Management business impacted by the consolidated investment management funds.
Additionally, other revenue includes asset servicing, treasury services, foreign exchange and other trading revenue and investment and other income.
|
(b)
|
Excludes amortization of intangible assets, provision for credit losses and distribution and servicing expense.
See “Supplemental information – Explanation of GAAP and Non-GAAP financial measures” beginning on page
23
for the reconciliation of this Non-GAAP measure.
|
(c)
|
Excludes securities lending cash management assets and assets managed in the Investment Services business.
|
(d)
|
Includes currency overlay assets under management.
|
(e)
|
Preliminary.
|
Page -
15
|
BNY Mellon 4Q17 Earnings Release
|
•
|
Income before taxes totaled
$276 million
in
4Q17
, an increase of
6%
year-over-year and a decrease of
8%
sequentially. Income before taxes, excluding amortization of intangible assets (Non-GAAP), totaled
$291 million
in
4Q17
, an increase of
3%
year-over-year and a decrease of
8%
sequentially.
|
•
|
Pre-tax operating margin of
26%
in
4Q17
decreased
78
bps year-over-year and
366
bps sequentially.
|
•
|
Adjusted pre-tax operating margin (Non-GAAP) of
31%
in
4Q17
decreased
240
bps year-over-year and
422
bps sequentially.
|
•
|
Total revenue was
$1.0 billion
, an increase of
9%
year-over-year and
5%
sequentially, primarily reflecting higher investment management fees and performance fees, partially offset by lower other revenue.
|
•
|
42%
of non-U.S. revenue in
4Q17
and
4Q16
.
|
•
|
Investment management fees increased
12%
year-over-year and
3%
sequentially, primarily reflecting higher equity market values and higher money market fees. The year-over-year increase also reflects the favorable impact of a weaker U.S. dollar (principally versus the British pound). On a constant currency basis, investment management fees increased
9%
(Non-GAAP) compared with 4Q16.
|
•
|
Net long-term inflows of
$16 billion
in
4Q17
reflect inflows of
l
iability-driven investments, partially offset by outflows of active equity and fixed income investments and index funds.
|
•
|
Net short-term outflows of
$4 billion
in
4Q17
.
|
•
|
Other revenue declined year-over-year primarily reflecting losses on hedging activity and higher payments to Investment Services related to higher money market fees, partially offset by seed capital gains.
|
•
|
Net interest revenue decreased
8%
year-over-year and
10%
sequentially. Both decreases primarily reflect lower average deposits.
|
•
|
Average loans increased
7%
year-over-year and
1%
sequentially.
|
•
|
Average deposits decreased
25%
year-over-year and
6%
sequentially.
|
•
|
Total noninterest expense (excluding amortization of intangible assets) increased
13%
year-over-year and
10%
sequentially. Both increases primarily reflect higher severance, incentive and software expenses. The year-over-year increase also reflects the unfavorable impact of the weaker U.S. dollar. The sequential increase also reflects seasonally higher business development expenses. Noninterest expense for 4Q17 includes
$30 million
related to severance and litigation.
|
Page -
16
|
BNY Mellon 4Q17 Earnings Release
|
(dollars in millions, unless otherwise noted)
|
|
|
|
|
|
|
4Q17 vs.
|
|||||||||||||
4Q17
|
|
|
3Q17
|
|
2Q17
|
|
1Q17
|
|
4Q16
|
|
3Q17
|
|
4Q16
|
|
||||||
Revenue:
|
|
|
|
|
|
|
|
|
||||||||||||
Investment services fees:
|
|
|
|
|
|
|
|
|
||||||||||||
Asset servicing
|
$
|
1,106
|
|
|
$
|
1,081
|
|
$
|
1,061
|
|
$
|
1,038
|
|
$
|
1,043
|
|
2
|
%
|
6
|
%
|
Clearing services
|
400
|
|
|
381
|
|
393
|
|
375
|
|
354
|
|
5
|
|
13
|
|
|||||
Issuer services
|
196
|
|
|
288
|
|
241
|
|
250
|
|
211
|
|
(32
|
)
|
(7
|
)
|
|||||
Treasury services
|
136
|
|
|
141
|
|
139
|
|
139
|
|
139
|
|
(4
|
)
|
(2
|
)
|
|||||
Total investment services fees
|
1,838
|
|
|
1,891
|
|
1,834
|
|
1,802
|
|
1,747
|
|
(3
|
)
|
5
|
|
|||||
Foreign exchange and other trading revenue
|
168
|
|
|
154
|
|
145
|
|
153
|
|
157
|
|
9
|
|
7
|
|
|||||
Other
(a)
|
135
|
|
|
142
|
|
136
|
|
129
|
|
128
|
|
(5
|
)
|
5
|
|
|||||
Total fee and other revenue
|
2,141
|
|
|
2,187
|
|
2,115
|
|
2,084
|
|
2,032
|
|
(2
|
)
|
5
|
|
|||||
Net interest revenue
|
813
|
|
|
777
|
|
761
|
|
707
|
|
713
|
|
5
|
|
14
|
|
|||||
Total revenue
|
2,954
|
|
|
2,964
|
|
2,876
|
|
2,791
|
|
2,745
|
|
—
|
|
8
|
|
|||||
Provision for credit losses
|
(2
|
)
|
|
(2
|
)
|
(3
|
)
|
—
|
|
—
|
|
N/M
|
N/M
|
|||||||
Noninterest expense (ex. amortization of intangible assets)
|
2,060
|
|
|
1,837
|
|
1,889
|
|
1,812
|
|
1,786
|
|
12
|
|
15
|
|
|||||
Amortization of intangible assets
|
37
|
|
|
37
|
|
38
|
|
37
|
|
38
|
|
—
|
|
(3
|
)
|
|||||
Total noninterest expense
|
2,097
|
|
|
1,874
|
|
1,927
|
|
1,849
|
|
1,824
|
|
12
|
|
15
|
|
|||||
Income before taxes
|
$
|
859
|
|
|
$
|
1,092
|
|
$
|
952
|
|
$
|
942
|
|
$
|
921
|
|
(21
|
)%
|
(7
|
)%
|
Income before taxes (ex. amortization of intangible assets)
–
Non-GAAP
|
$
|
896
|
|
|
$
|
1,129
|
|
$
|
990
|
|
$
|
979
|
|
$
|
959
|
|
(21
|
)%
|
(7
|
)%
|
|
|
|
|
|
|
|
|
|
||||||||||||
Pre-tax operating margin
|
29
|
%
|
|
37
|
%
|
33
|
%
|
34
|
%
|
34
|
%
|
|
|
|||||||
Adjusted pre-tax operating margin (ex. provision for credit losses and amortization of intangible assets)
–
Non-GAAP
|
30
|
%
|
|
38
|
%
|
34
|
%
|
35
|
%
|
35
|
%
|
|
|
|||||||
|
|
|
|
|
|
|
|
|
||||||||||||
Investment services fees as a percentage of noninterest expense (ex. amortization of intangible assets)
|
89
|
%
|
|
103
|
%
|
97
|
%
|
99
|
%
|
98
|
%
|
|
|
|||||||
|
|
|
|
|
|
|
|
|
||||||||||||
Securities lending revenue
|
$
|
45
|
|
|
$
|
41
|
|
$
|
42
|
|
$
|
40
|
|
$
|
44
|
|
10
|
%
|
2
|
%
|
|
|
|
|
|
|
|
|
|
||||||||||||
Metrics:
|
|
|
|
|
|
|
|
|
||||||||||||
Average loans
|
$
|
38,845
|
|
|
$
|
38,038
|
|
$
|
40,931
|
|
$
|
42,818
|
|
$
|
45,832
|
|
2
|
%
|
(15
|
)%
|
Average deposits
|
$
|
204,680
|
|
|
$
|
198,299
|
|
$
|
200,417
|
|
$
|
197,690
|
|
$
|
213,531
|
|
3
|
%
|
(4
|
)%
|
|
|
|
|
|
|
|
|
|
||||||||||||
AUC/A at period end
(in trillions) (b)
|
$
|
33.3
|
|
(c)
|
$
|
32.2
|
|
$
|
31.1
|
|
$
|
30.6
|
|
$
|
29.9
|
|
3
|
%
|
11
|
%
|
Market value of securities on loan at period end
(in billions) (d)
|
$
|
408
|
|
|
$
|
382
|
|
$
|
336
|
|
$
|
314
|
|
$
|
296
|
|
7
|
%
|
38
|
%
|
|
|
|
|
|
|
|
|
|
||||||||||||
Asset servicing:
|
|
|
|
|
|
|
|
|
||||||||||||
Estimated new business wins (AUC/A)
(in billions)
|
$
|
575
|
|
(c)
|
$
|
166
|
|
$
|
152
|
|
$
|
109
|
|
$
|
141
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||||||||||||
Clearing services:
|
|
|
|
|
|
|
|
|
||||||||||||
Average active clearing accounts (U.S. platform)
(
in thousands)
|
6,126
|
|
|
6,203
|
|
6,159
|
|
6,058
|
|
5,960
|
|
(1
|
)%
|
3
|
%
|
|||||
Average long-term mutual fund assets (U.S. platform)
|
$
|
508,873
|
|
|
$
|
500,998
|
|
$
|
480,532
|
|
$
|
460,977
|
|
$
|
438,460
|
|
2
|
%
|
16
|
%
|
Average investor margin loans (U.S. platform)
|
$
|
9,822
|
|
|
$
|
8,886
|
|
$
|
9,812
|
|
$
|
10,740
|
|
$
|
10,562
|
|
11
|
%
|
(7
|
)%
|
|
|
|
|
|
|
|
|
|
||||||||||||
Depositary Receipts:
|
|
|
|
|
|
|
|
|
||||||||||||
Number of sponsored programs
|
886
|
|
|
938
|
|
1,025
|
|
1,050
|
|
1,062
|
|
(6
|
)%
|
(17
|
)%
|
|||||
|
|
|
|
|
|
|
|
|
||||||||||||
Broker-Dealer:
|
|
|
|
|
|
|
|
|
||||||||||||
Average tri-party repo balances (
in billions)
|
$
|
2,606
|
|
|
$
|
2,534
|
|
$
|
2,498
|
|
$
|
2,373
|
|
$
|
2,307
|
|
3
|
%
|
13
|
%
|
(a)
|
Other revenue includes investment management fees, financing-related fees, distribution and servicing revenue and investment and other income.
|
(b)
|
Includes the AUC/A of CIBC Mellon Global Securities Services Company (“CIBC Mellon”), a joint venture with the Canadian Imperial Bank of Commerce, of
$1.3 trillion
at
Dec. 31, 2017
and
Sept. 30, 2017
and
$1.2 trillion
at
June 30, 2017
,
March 31, 2017
and
Dec. 31, 2016
.
|
(c)
|
Preliminary.
|
(d)
|
Represents the total amount of securities on loan in our agency securities lending program managed by the Investment Services business. Excludes securities for which BNY Mellon acts as agent on behalf of CIBC Mellon clients, which totaled
$71 billion
at
Dec. 31, 2017
,
$68 billion
at
Sept. 30, 2017
,
$66 billion
at
June 30, 2017
,
$65 billion
at
March 31, 2017
and
$63 billion
at
Dec. 31, 2016
.
|
Page -
17
|
BNY Mellon 4Q17 Earnings Release
|
•
|
Income before taxes totaled
$859 million
in
4Q17
. Income before taxes, excluding amortization of intangible assets (Non-GAAP), totaled
$896 million
in
4Q17
.
|
•
|
The pre-tax operating margin was
29%
in
4Q17
. The pre-tax operating margin, excluding the provision for credit losses and amortization of intangible assets (Non-GAAP), was
30%
in
4Q17
.
|
•
|
Investment services fees as a percentage of noninterest expense (excluding amortization of intangible assets) was
89%
in
4Q17
.
|
•
|
Investment services fees increased
5%
year-over-year and decreased
3%
sequentially.
|
•
|
Asset servicing fees increased
6%
year-over-year and
2%
sequentially.
The year-over-year increase primarily reflects higher equity market values, net new business, including growth in collateral management, and the favorable impact of the weaker U.S. dollar.
The sequential increase was primarily driven by net new business, securities lending, equity market values and money market fees.
|
•
|
Clearing services fees increased
13%
year-over-year and
5%
sequentially. The year-over-year increase primarily reflects
higher money market fees and growth in long-term mutual fund assets.
Both increases also reflect
termination fees due to lost business recorded in 4Q17
.
|
•
|
Issuer services fees decreased
7%
year-over-year and
32%
sequentially. The year-over-year decrease primarily reflects
lower volumes, fewer corporate actions and lower fees due to a reduction in shares outstanding in certain Depositary Receipts programs, partially offset by higher Corporate Trust revenue
. The sequential decrease primarily reflects
seasonality in Depositary Receipts revenue
.
|
•
|
Treasury services fees decreased
2%
year-over-year and
4%
sequentially, primarily reflecting
higher compensating balance credits provided to clients, which reduced fee revenue and increased net interest revenue, partially offset by higher payment volumes.
|
•
|
Foreign exchange and other trading revenue increased
7%
year-over-year and
9%
sequentially. Year-over year,
higher volumes were offset by lower volatility
. The sequential increase reflects higher volumes.
|
•
|
Other revenue increased
5%
year-over-year primarily reflecting higher payments from Investment Management related to higher money market fees. The
5%
sequential decrease primarily reflects lower financing-related fees.
|
•
|
Net interest revenue increased
14%
year-over-year and
5%
sequentially. Both increases primarily reflect higher interest rates. The year-over-year increase was partially offset by lower loan and deposit volumes. The sequential increase also reflects higher loan and deposit volumes.
|
•
|
Noninterest expense (excluding amortization of intangible assets) increased
15%
year-over-year and
12%
sequentially. Both increases primarily reflect higher severance, litigation, an asset impairment and additional technology related costs. The year-over-year increase also reflects higher incentives expense and the unfavorable impact of the weaker U.S. dollar. Noninterest expense for 4Q17 includes
$233 million
related to severance, litigation and an asset impairment.
|
Page -
18
|
BNY Mellon 4Q17 Earnings Release
|
|
|
|
|
|
|
||||||||||
(in millions)
|
4Q17
|
|
3Q17
|
|
2Q17
|
|
1Q17
|
|
4Q16
|
|
|||||
Revenue:
|
|
|
|
|
|
||||||||||
Fee and other revenue
|
$
|
(247
|
)
|
$
|
69
|
|
$
|
113
|
|
$
|
72
|
|
$
|
42
|
|
Net interest (expense) revenue
|
(36
|
)
|
(20
|
)
|
(22
|
)
|
(1
|
)
|
38
|
|
|||||
Total revenue
|
(283
|
)
|
49
|
|
91
|
|
71
|
|
80
|
|
|||||
Provision for credit losses
|
(5
|
)
|
(2
|
)
|
(4
|
)
|
(8
|
)
|
1
|
|
|||||
Noninterest expense (ex. M&I and restructuring charges)
|
134
|
|
77
|
|
28
|
|
106
|
|
108
|
|
|||||
M&I and restructuring charges
|
1
|
|
—
|
|
—
|
|
1
|
|
2
|
|
|||||
Total noninterest expense
|
135
|
|
77
|
|
28
|
|
107
|
|
110
|
|
|||||
(Loss) income before taxes
|
$
|
(413
|
)
|
$
|
(26
|
)
|
$
|
67
|
|
$
|
(28
|
)
|
$
|
(31
|
)
|
(Loss) income before taxes (ex. M&I and restructuring charges)
–
Non-GAAP
|
$
|
(412
|
)
|
$
|
(26
|
)
|
$
|
67
|
|
$
|
(27
|
)
|
$
|
(29
|
)
|
|
|
|
|
|
|
||||||||||
Average loans and leases
|
$
|
1,114
|
|
$
|
1,182
|
|
$
|
1,302
|
|
$
|
1,341
|
|
$
|
2,142
|
|
•
|
Total fee and other revenue
decreased
$289 million
compared with
4Q16
and
$316 million
compared with
3Q17
, primarily reflecting
the impact of U.S. tax legislation on our investments in renewable energy
and net securities losses. The net impact of U.S. tax legislation on renewable energy investments was de minimis to net income, as the pre-tax accounting resulted in a reduction of
$279 million
to investment and other income, which was offset by the tax benefit from remeasurement of the related deferred tax liability.
|
•
|
Net interest revenue
decreased
$74 million
compared with
4Q16
and
$16 million
compared with
3Q17
. Both decreases primarily reflect leasing-related adjustments, partially offset by higher interest rates. The year-over-year decrease also reflects the positive impact of interest rate hedging activities and a premium amortization adjustment, both recorded in 4Q16.
|
•
|
Noninterest expense (excluding M&I and restructuring charges)
increased
$26 million
compared with
4Q16
and
increased
$57 million
compared with
3Q17
. Both increases were primarily driven by severance expense of
$19 million
recorded in 4Q17. The sequential increase also reflects higher professional, legal and other purchased services and occupancy expenses.
|
Page -
19
|
BNY Mellon 4Q17 Earnings Release
|
(in millions)
|
Quarter ended
|
|
Year ended
|
||||||||||||||
Dec. 31, 2017
|
|
Sept. 30, 2017
|
|
Dec. 31, 2016
|
|
|
Dec. 31, 2017
|
|
Dec. 31, 2016
|
|
|||||||
Fee and other revenue
|
|
|
|
|
|
|
|||||||||||
Investment services fees:
|
|
|
|
|
|
|
|||||||||||
Asset servicing
|
$
|
1,130
|
|
$
|
1,105
|
|
$
|
1,068
|
|
|
$
|
4,383
|
|
$
|
4,244
|
|
|
Clearing services
|
400
|
|
383
|
|
355
|
|
|
1,553
|
|
1,404
|
|
||||||
Issuer services
|
197
|
|
288
|
|
211
|
|
|
977
|
|
1,026
|
|
||||||
Treasury services
|
137
|
|
141
|
|
140
|
|
|
557
|
|
547
|
|
||||||
Total investment services fees
|
1,864
|
|
1,917
|
|
1,774
|
|
|
7,470
|
|
7,221
|
|
||||||
Investment management and performance fees
|
962
|
|
901
|
|
848
|
|
|
3,584
|
|
3,350
|
|
||||||
Foreign exchange and other trading revenue
|
166
|
|
173
|
|
161
|
|
|
668
|
|
701
|
|
||||||
Financing-related fees
|
54
|
|
54
|
|
50
|
|
|
216
|
|
219
|
|
||||||
Distribution and servicing
|
38
|
|
40
|
|
41
|
|
|
160
|
|
166
|
|
||||||
Investment and other income (loss)
|
(198
|
)
|
63
|
|
70
|
|
|
64
|
|
341
|
|
||||||
Total fee revenue
|
2,886
|
|
3,148
|
|
2,944
|
|
|
12,162
|
|
11,998
|
|
||||||
Net securities (losses) gains
|
(26
|
)
|
19
|
|
10
|
|
|
3
|
|
75
|
|
||||||
Total fee and other revenue
|
2,860
|
|
3,167
|
|
2,954
|
|
|
12,165
|
|
12,073
|
|
||||||
Operations of consolidated investment management funds
|
|
|
|
|
|
|
|||||||||||
Investment income
|
17
|
|
10
|
|
8
|
|
|
74
|
|
35
|
|
||||||
Interest of investment management fund note holders
|
—
|
|
—
|
|
3
|
|
|
4
|
|
9
|
|
||||||
Income from consolidated investment management funds
|
17
|
|
10
|
|
5
|
|
|
70
|
|
26
|
|
||||||
Net interest revenue
|
|
|
|
|
|
|
|||||||||||
Interest revenue
|
1,219
|
|
1,151
|
|
928
|
|
|
4,382
|
|
3,575
|
|
||||||
Interest expense
|
368
|
|
312
|
|
97
|
|
|
1,074
|
|
437
|
|
||||||
Net interest revenue
|
851
|
|
839
|
|
831
|
|
|
3,308
|
|
3,138
|
|
||||||
Total revenue
|
3,728
|
|
4,016
|
|
3,790
|
|
|
15,543
|
|
15,237
|
|
||||||
Provision for credit losses
|
(6
|
)
|
(6
|
)
|
7
|
|
|
(24
|
)
|
(11
|
)
|
||||||
Noninterest expense
|
|
|
|
|
|
|
|||||||||||
Staff
|
1,614
|
|
1,469
|
|
1,395
|
|
|
5,972
|
|
5,733
|
|
||||||
Professional, legal and other purchased services
|
338
|
|
305
|
|
325
|
|
|
1,274
|
|
1,185
|
|
||||||
Software and equipment
|
297
|
|
233
|
|
237
|
|
|
985
|
|
894
|
|
||||||
Net occupancy
|
153
|
|
141
|
|
153
|
|
|
569
|
|
590
|
|
||||||
Distribution and servicing
|
106
|
|
109
|
|
98
|
|
|
419
|
|
405
|
|
||||||
Sub-custodian
|
59
|
|
62
|
|
57
|
|
|
250
|
|
245
|
|
||||||
Business development
|
66
|
|
49
|
|
71
|
|
|
229
|
|
245
|
|
||||||
Bank assessment charges
|
53
|
|
51
|
|
53
|
|
|
220
|
|
219
|
|
||||||
Other
|
188
|
|
177
|
|
175
|
|
|
724
|
|
721
|
|
||||||
Amortization of intangible assets
|
52
|
|
52
|
|
60
|
|
|
209
|
|
237
|
|
||||||
M&I, litigation and restructuring charges
|
80
|
|
6
|
|
7
|
|
|
106
|
|
49
|
|
||||||
Total noninterest expense
|
3,006
|
|
2,654
|
|
2,631
|
|
|
10,957
|
|
10,523
|
|
||||||
Income
|
|
|
|
|
|
|
|
||||||||||
Income before income taxes
|
728
|
|
1,368
|
|
1,152
|
|
|
4,610
|
|
4,725
|
|
||||||
(Benefit) provision for income taxes
|
(453
|
)
|
348
|
|
280
|
|
|
496
|
|
1,177
|
|
||||||
Net income
|
1,181
|
|
1,020
|
|
872
|
|
|
4,114
|
|
3,548
|
|
||||||
Net (income) attributable to noncontrolling interests (includes $(9), $(3), $(4), $(33) and $(10) related to consolidated investment management funds, respectively)
|
(6
|
)
|
(2
|
)
|
(2
|
)
|
|
(24
|
)
|
(1
|
)
|
||||||
Net income applicable to shareholders of The Bank of New York Mellon Corporation
|
1,175
|
|
1,018
|
|
870
|
|
|
4,090
|
|
3,547
|
|
||||||
Preferred stock dividends
|
(49
|
)
|
(35
|
)
|
(48
|
)
|
|
(175
|
)
|
(122
|
)
|
||||||
Net income applicable to common shareholders of The Bank of New York Mellon Corporation
|
$
|
1,126
|
|
$
|
983
|
|
$
|
822
|
|
|
$
|
3,915
|
|
$
|
3,425
|
|
Page -
20
|
BNY Mellon 4Q17 Earnings Release
|
Net income applicable to common shareholders of The Bank of New York Mellon Corporation used for the earnings per share calculation
|
Quarter ended
|
|
Year ended
|
|||||||||||||
Dec. 31, 2017
|
|
Sept. 30, 2017
|
|
Dec. 31, 2016
|
|
|
Dec. 31, 2017
|
|
Dec. 31, 2016
|
|
||||||
(in millions)
|
||||||||||||||||
Net income applicable to common shareholders of The Bank of New York Mellon Corporation
|
$
|
1,126
|
|
$
|
983
|
|
$
|
822
|
|
|
$
|
3,915
|
|
$
|
3,425
|
|
Less: Earnings allocated to participating securities
(a)
|
8
|
|
8
|
|
13
|
|
|
43
|
|
52
|
|
|||||
Net income applicable to the common shareholders of The Bank of New York Mellon Corporation after required adjustments for the calculation of basic and diluted earnings per common share
|
$
|
1,118
|
|
$
|
975
|
|
$
|
809
|
|
|
$
|
3,872
|
|
$
|
3,373
|
|
(a)
|
Beginning in 3Q17, vested stock awards to retirement eligible employees are included in common shares outstanding for earnings per share purposes. This change increased both average basic and average diluted shares outstanding by approximately 6 million and reduced earnings allocated to participating securities by $6 million for 3Q17, which resulted in a de minimis impact to both basic and diluted earnings per share.
|
Average common shares and equivalents outstanding of The Bank of New York Mellon Corporation
(a)
|
Quarter ended
|
|
Year ended
|
||||||||
Dec. 31, 2017
|
|
Sept. 30, 2017
|
|
Dec. 31, 2016
|
|
|
Dec. 31, 2017
|
|
Dec. 31, 2016
|
|
|
(in thousands)
|
|||||||||||
Basic
|
1,024,828
|
|
1,035,337
|
|
1,050,888
|
|
|
1,034,281
|
|
1,066,286
|
|
Diluted
|
1,030,404
|
|
1,041,138
|
|
1,056,818
|
|
|
1,040,290
|
|
1,072,013
|
|
(a)
|
Beginning in 3Q17, vested stock awards to retirement eligible employees are included in common shares outstanding for earnings per share purposes. This change increased both average basic and average diluted shares outstanding by approximately 6 million and reduced earnings allocated to participating securities by $6 million for 3Q17, which resulted in a de minimis impact to both basic and diluted earnings per share.
|
Earnings per share applicable to the common shareholders of The Bank of New York Mellon Corporation
|
Quarter ended
|
|
Year ended
|
|||||||||||||
Dec. 31, 2017
|
|
Sept. 30, 2017
|
|
Dec. 31, 2016
|
|
|
Dec. 31, 2017
|
|
Dec. 31, 2016
|
|
||||||
(in dollars)
|
||||||||||||||||
Basic
|
$
|
1.09
|
|
$
|
0.94
|
|
$
|
0.77
|
|
|
$
|
3.74
|
|
$
|
3.16
|
|
Diluted
|
$
|
1.08
|
|
$
|
0.94
|
|
$
|
0.77
|
|
|
$
|
3.72
|
|
$
|
3.15
|
|
Page -
21
|
BNY Mellon 4Q17 Earnings Release
|
(dollars in millions, except per share amounts)
|
Dec. 31, 2017
|
|
Sept. 30, 2017
|
|
Dec. 31, 2016
|
|
||||
Assets
|
|
|
|
|||||||
Cash and due from:
|
|
|
|
|||||||
Banks
|
$
|
5,382
|
|
$
|
5,557
|
|
$
|
4,822
|
|
|
Interest-bearing deposits with the Federal Reserve and other central banks
|
91,510
|
|
75,808
|
|
58,041
|
|
||||
Interest-bearing deposits with banks
|
11,979
|
|
15,256
|
|
15,086
|
|
||||
Federal funds sold and securities purchased under resale agreements
|
28,135
|
|
27,883
|
|
25,801
|
|
||||
Securities:
|
|
|
|
|||||||
Held-to-maturity (fair value of $40,512, $39,928 and $40,669)
|
40,827
|
|
39,995
|
|
40,905
|
|
||||
Available-for-sale
|
79,543
|
|
80,054
|
|
73,822
|
|
||||
Total securities
|
120,370
|
|
120,049
|
|
114,727
|
|
||||
Trading assets
|
6,022
|
|
4,666
|
|
5,733
|
|
||||
Loans
|
61,540
|
|
59,068
|
|
64,458
|
|
||||
Allowance for loan losses
|
(159
|
)
|
(161
|
)
|
(169
|
)
|
||||
Net loans
|
61,381
|
|
58,907
|
|
64,289
|
|
||||
Premises and equipment
|
1,634
|
|
1,631
|
|
1,303
|
|
||||
Accrued interest receivable
|
610
|
|
547
|
|
568
|
|
||||
Goodwill
|
17,564
|
|
17,543
|
|
17,316
|
|
||||
Intangible assets
|
3,411
|
|
3,461
|
|
3,598
|
|
||||
Other assets
|
23,029
|
|
22,287
|
|
20,954
|
|
||||
Subtotal assets of operations
|
371,027
|
|
353,595
|
|
332,238
|
|
||||
Assets of consolidated investment management funds, at fair value
|
731
|
|
802
|
|
1,231
|
|
||||
Total assets
|
$
|
371,758
|
|
$
|
354,397
|
|
$
|
333,469
|
|
|
Liabilities
|
|
|
|
|||||||
Deposits:
|
|
|
|
|||||||
Noninterest-bearing (principally U.S. offices)
|
$
|
82,716
|
|
$
|
80,380
|
|
$
|
78,342
|
|
|
Interest-bearing deposits in U.S. offices
|
52,294
|
|
46,023
|
|
52,049
|
|
||||
Interest-bearing deposits in Non-U.S. offices
|
109,312
|
|
104,593
|
|
91,099
|
|
||||
Total deposits
|
244,322
|
|
230,996
|
|
221,490
|
|
||||
Federal funds purchased and securities sold under repurchase agreements
|
15,163
|
|
10,314
|
|
9,989
|
|
||||
Trading liabilities
|
3,984
|
|
3,253
|
|
4,389
|
|
||||
Payables to customers and broker-dealers
|
20,184
|
|
21,176
|
|
20,987
|
|
||||
Commercial paper
|
3,075
|
|
2,501
|
|
—
|
|
||||
Other borrowed funds
|
3,028
|
|
3,353
|
|
754
|
|
||||
Accrued taxes and other expenses
|
6,225
|
|
6,070
|
|
5,867
|
|
||||
Other liabilities (includes allowance for lending-related commitments of $102, $104 and $112)
|
6,050
|
|
7,195
|
|
5,635
|
|
||||
Long-term debt
|
27,979
|
|
28,408
|
|
24,463
|
|
||||
Subtotal liabilities of operations
|
330,010
|
|
313,266
|
|
293,574
|
|
||||
Liabilities of consolidated investment management funds, at fair value
|
2
|
|
27
|
|
315
|
|
||||
Total liabilities
|
330,012
|
|
313,293
|
|
293,889
|
|
||||
Temporary equity
|
|
|
|
|||||||
Redeemable noncontrolling interests
|
179
|
|
197
|
|
151
|
|
||||
Permanent equity
|
|
|
|
|||||||
Preferred stock – par value $0.01 per share; authorized 100,000,000 shares; issued 35,826, 35,826 and 35,826 shares
|
3,542
|
|
3,542
|
|
3,542
|
|
||||
Common stock – par value $0.01 per share; authorized 3,500,000,000 shares; issued 1,354,163,581, 1,352,363,932 and 1,333,706,427 shares
|
14
|
|
14
|
|
13
|
|
||||
Additional paid-in capital
|
26,665
|
|
26,588
|
|
25,962
|
|
||||
Retained earnings
|
25,635
|
|
24,757
|
|
22,621
|
|
||||
Accumulated other comprehensive loss, net of tax
|
(2,357
|
)
|
(2,781
|
)
|
(3,765
|
)
|
||||
Less: Treasury stock of 340,721,136, 328,341,579 and 286,218,126 common shares, at cost
|
(12,248
|
)
|
(11,597
|
)
|
(9,562
|
)
|
||||
Total The Bank of New York Mellon Corporation shareholders’ equity
|
41,251
|
|
40,523
|
|
38,811
|
|
||||
Nonredeemable noncontrolling interests of consolidated investment management funds
|
316
|
|
384
|
|
618
|
|
||||
Total permanent equity
|
41,567
|
|
40,907
|
|
39,429
|
|
||||
Total liabilities, temporary equity and permanent equity
|
$
|
371,758
|
|
$
|
354,397
|
|
$
|
333,469
|
|
Page -
22
|
BNY Mellon 4Q17 Earnings Release
|
Amounts included in 4Q17 results -
by business segment
(dollars in millions)
|
U.S. tax legislation
|
|
Other charges
(a)
|
|||||||||||||||||||
Investment
Management
|
|
Investment
Services
|
|
Other
|
|
|
Investment
Management
|
|
Investment
Services
|
|
Other
|
|
Total
|
|
||||||||
Fee and other revenue
|
$
|
—
|
|
$
|
—
|
|
$
|
(279
|
)
|
|
$
|
—
|
|
$
|
—
|
|
$
|
(37
|
)
|
$
|
(37
|
)
|
Net interest revenue
|
—
|
|
—
|
|
(4
|
)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||||
Total revenue
|
—
|
|
—
|
|
(283
|
)
|
|
—
|
|
—
|
|
(37
|
)
|
(37
|
)
|
|||||||
Total noninterest expense
|
—
|
|
—
|
|
—
|
|
|
30
|
|
233
|
|
19
|
|
282
|
|
|||||||
Income before taxes
|
$
|
—
|
|
$
|
—
|
|
$
|
(283
|
)
|
|
$
|
(30
|
)
|
$
|
(233
|
)
|
$
|
(56
|
)
|
$
|
(319
|
)
|
(a)
|
Other charges include severance, litigation, an asset impairment and investment securities losses related to the sale of certain securities.
|
Page -
23
|
BNY Mellon 4Q17 Earnings Release
|
Pre-tax operating margin
|
|
|
|
|
|
||||||||||
(dollars in millions)
|
4Q17
|
|
3Q17
|
|
2Q17
|
|
1Q17
|
|
4Q16
|
|
|||||
Income before income taxes – GAAP
|
$
|
728
|
|
$
|
1,368
|
|
$
|
1,308
|
|
$
|
1,206
|
|
$
|
1,152
|
|
Less: Net income attributable to noncontrolling interests of consolidated investment management funds
|
9
|
|
3
|
|
3
|
|
18
|
|
4
|
|
|||||
Add: Amortization of intangible assets
|
52
|
|
52
|
|
53
|
|
52
|
|
60
|
|
|||||
M&I, litigation and restructuring charges
|
80
|
|
6
|
|
12
|
|
8
|
|
7
|
|
|||||
Income before income taxes, as adjusted – Non-GAAP
(a)
|
$
|
851
|
|
$
|
1,423
|
|
$
|
1,370
|
|
$
|
1,248
|
|
$
|
1,215
|
|
|
|
|
|
|
|
||||||||||
Fee and other revenue – GAAP
|
$
|
2,860
|
|
$
|
3,167
|
|
$
|
3,120
|
|
$
|
3,018
|
|
$
|
2,954
|
|
Income from consolidated investment management funds – GAAP
|
17
|
|
10
|
|
10
|
|
33
|
|
5
|
|
|||||
Net interest revenue – GAAP
|
851
|
|
839
|
|
826
|
|
792
|
|
831
|
|
|||||
Total revenue – GAAP
|
3,728
|
|
4,016
|
|
3,956
|
|
3,843
|
|
3,790
|
|
|||||
Less: Net income attributable to noncontrolling interests of consolidated investment management funds
|
9
|
|
3
|
|
3
|
|
18
|
|
4
|
|
|||||
Total revenue, as adjusted – Non-GAAP
(a)
|
$
|
3,719
|
|
$
|
4,013
|
|
$
|
3,953
|
|
$
|
3,825
|
|
$
|
3,786
|
|
|
|
|
|
|
|
||||||||||
Pre-tax operating margin – GAAP
(b)(c)
|
20
|
%
|
34
|
%
|
33
|
%
|
31
|
%
|
30
|
%
|
|||||
Adjusted pre-tax operating margin – Non-GAAP
(a)(b)(c)
|
23
|
%
|
35
|
%
|
35
|
%
|
33
|
%
|
32
|
%
|
(a)
|
Non-GAAP information for all periods presented excludes net income attributable to noncontrolling interests of consolidated investment management funds,
amortization of intangible assets and M&I, litigation and restructuring charges.
|
(b)
|
Income before taxes divided by total revenue.
|
(c)
|
Our GAAP earnings include tax-advantaged investments such as low income housing, renewable energy, corporate/bank-owned life insurance and tax-exempt securities. The benefits of these investments are primarily reflected in tax expense. If reported on a tax-equivalent basis, these investments would increase revenue and income before taxes by $
66 million
for
4Q17
, $
102 million
for
3Q17
, $
106 million
for
2Q17
, $
101 million
for
1Q17
and $
92 million
for
4Q16
and would increase our pre-tax operating margin by approximately
1.4
% for
4Q17
,
1.6
% for
3Q17
,
1.8
% for
2Q17
and
1Q17
and
1.7
% for
4Q16
.
|
Page -
24
|
BNY Mellon 4Q17 Earnings Release
|
Operating leverage
|
|
|
|
4Q17 vs.
|
|||||||||
(dollars in millions)
|
4Q17
|
|
3Q17
|
|
4Q16
|
|
3Q17
|
|
4Q16
|
|
|||
Total revenue
–
GAAP
|
$
|
3,728
|
|
$
|
4,016
|
|
$
|
3,790
|
|
(7.17
|
)%
|
(1.64
|
)%
|
Less: Net income attributable to noncontrolling interests of consolidated investment management funds
|
9
|
|
3
|
|
4
|
|
|
|
|||||
Total revenue, as adjusted
–
Non-GAAP
|
$
|
3,719
|
|
$
|
4,013
|
|
$
|
3,786
|
|
(7.33
|
)%
|
(1.77
|
)%
|
|
|
|
|
|
|
||||||||
Total noninterest expense
–
GAAP
|
$
|
3,006
|
|
$
|
2,654
|
|
$
|
2,631
|
|
13.26
|
%
|
14.25
|
%
|
Less: Amortization of intangible assets
|
52
|
|
52
|
|
60
|
|
|
|
|||||
M&I, litigation and restructuring charges
|
80
|
|
6
|
|
7
|
|
|
|
|||||
Total noninterest expense, as adjusted
–
Non-GAAP
|
$
|
2,874
|
|
$
|
2,596
|
|
$
|
2,564
|
|
10.71
|
%
|
12.09
|
%
|
|
|
|
|
|
|
||||||||
Operating leverage
–
GAAP
(a)
|
|
|
|
(2,043
|
) bps
|
(1,589
|
) bps
|
||||||
Adjusted operating leverage
–
Non-GAAP
(a)(b)
|
|
|
|
(1,804
|
) bps
|
(1,386
|
) bps
|
(a)
|
Operating leverage is the rate of increase (decrease) in total revenue less the rate of increase (decrease) in total noninterest expense.
|
(b)
|
Non-GAAP operating leverage for all periods presented excludes net income attributable to noncontrolling interests of consolidated investment management funds, amortization of intangible assets and M&I, litigation and restructuring charges.
|
Return on common equity and tangible common equity
|
|
|
|
|
|
|
||||||||||||
(dollars in millions)
|
4Q17
|
|
3Q17
|
|
2Q17
|
|
1Q17
|
|
4Q16
|
|
FY17
|
|
||||||
Net income applicable to common shareholders of The Bank of New York Mellon Corporation – GAAP
|
$
|
1,126
|
|
$
|
983
|
|
$
|
926
|
|
$
|
880
|
|
$
|
822
|
|
$
|
3,915
|
|
Add: Amortization of intangible assets
|
52
|
|
52
|
|
53
|
|
52
|
|
60
|
|
209
|
|
||||||
Less: Tax impact of amortization of intangible assets
|
18
|
|
17
|
|
19
|
|
18
|
|
19
|
|
72
|
|
||||||
Adjusted net income applicable to common shareholders of The Bank of New York Mellon Corporation excluding amortization of intangible assets – Non-GAAP
|
1,160
|
|
1,018
|
|
960
|
|
914
|
|
863
|
|
4,052
|
|
||||||
Add: M&I, litigation and restructuring charges
|
80
|
|
6
|
|
12
|
|
8
|
|
7
|
|
106
|
|
||||||
Less: Tax impact of M&I, litigation and restructuring charges
|
15
|
|
—
|
|
3
|
|
2
|
|
3
|
|
20
|
|
||||||
Adjusted net income applicable to common shareholders of The Bank of New York Mellon Corporation, as adjusted – Non-GAAP
(a)
|
$
|
1,225
|
|
$
|
1,024
|
|
$
|
969
|
|
$
|
920
|
|
$
|
867
|
|
$
|
4,138
|
|
|
|
|
|
|
|
|
|
|||||||||||
Average common shareholders’ equity
|
$
|
36,952
|
|
$
|
36,780
|
|
$
|
35,862
|
|
$
|
34,965
|
|
$
|
35,171
|
|
$
|
36,145
|
|
Less: Average goodwill
|
17,518
|
|
17,497
|
|
17,408
|
|
17,338
|
|
17,344
|
|
17,441
|
|
||||||
Average intangible assets
|
3,437
|
|
3,487
|
|
3,532
|
|
3,578
|
|
3,638
|
|
3,508
|
|
||||||
Add: Deferred tax liability – tax deductible goodwill
(b)
|
1,034
|
|
1,561
|
|
1,542
|
|
1,518
|
|
1,497
|
|
1,034
|
|
||||||
Deferred tax liability – intangible assets
(b)
|
718
|
|
1,092
|
|
1,095
|
|
1,100
|
|
1,105
|
|
718
|
|
||||||
Average tangible common shareholders’ equity – Non-GAAP
|
$
|
17,749
|
|
$
|
18,449
|
|
$
|
17,559
|
|
$
|
16,667
|
|
$
|
16,791
|
|
$
|
16,948
|
|
|
|
|
|
|
|
|
|
|||||||||||
Return on common equity – GAAP
(c)
|
12.1
|
%
|
10.6
|
%
|
10.4
|
%
|
10.2
|
%
|
9.3
|
%
|
10.8
|
%
|
||||||
Adjusted return on common equity – Non-GAAP
(a)(c)
|
13.2
|
%
|
11.0
|
%
|
10.8
|
%
|
10.7
|
%
|
9.8
|
%
|
11.4
|
%
|
||||||
|
|
|
|
|
|
|
|
|||||||||||
Return on tangible common equity – Non-GAAP
(c)
|
25.9
|
%
|
21.9
|
%
|
21.9
|
%
|
22.2
|
%
|
20.4
|
%
|
23.9
|
%
|
||||||
Adjusted return on tangible common equity – Non-GAAP
(a)(c)
|
27.4
|
%
|
22.0
|
%
|
22.1
|
%
|
22.4
|
%
|
20.5
|
%
|
24.4
|
%
|
(a)
|
Non-GAAP information for all periods presented excludes amortization of intangible assets and
M&I, litigation and restructuring charges.
|
(b)
|
Deferred tax liabilities are based on fully phased-in Basel III capital rules.
Deferred tax liabilities at Dec. 31, 2017 have been remeasured at the lower statutory corporate tax rate.
|
(c)
|
Quarterly returns are annualized.
|
Page -
25
|
BNY Mellon 4Q17 Earnings Release
|
Book value per common share
|
Dec. 31, 2017
|
|
Sept. 30, 2017
|
|
June 30, 2017
|
|
March 31, 2017
|
|
Dec. 31, 2016
|
|
|||||
(dollars in millions, unless otherwise noted)
|
|||||||||||||||
BNY Mellon shareholders’ equity at period end – GAAP
|
$
|
41,251
|
|
$
|
40,523
|
|
$
|
39,974
|
|
$
|
39,138
|
|
$
|
38,811
|
|
Less: Preferred stock
|
3,542
|
|
3,542
|
|
3,542
|
|
3,542
|
|
3,542
|
|
|||||
BNY Mellon common shareholders’ equity at period end – GAAP
|
37,709
|
|
36,981
|
|
36,432
|
|
35,596
|
|
35,269
|
|
|||||
Less: Goodwill
|
17,564
|
|
17,543
|
|
17,457
|
|
17,355
|
|
17,316
|
|
|||||
Intangible assets
|
3,411
|
|
3,461
|
|
3,506
|
|
3,549
|
|
3,598
|
|
|||||
Add: Deferred tax liability – tax deductible goodwill
(a)
|
1,034
|
|
1,561
|
|
1,542
|
|
1,518
|
|
1,497
|
|
|||||
Deferred tax liability – intangible assets
(a)
|
718
|
|
1,092
|
|
1,095
|
|
1,100
|
|
1,105
|
|
|||||
BNY Mellon tangible common shareholders’ equity at period
end – Non-GAAP
|
$
|
18,486
|
|
$
|
18,630
|
|
$
|
18,106
|
|
$
|
17,310
|
|
$
|
16,957
|
|
|
|
|
|
|
|
||||||||||
Period-end common shares outstanding
(in thousands)
|
1,013,442
|
|
1,024,022
|
|
1,033,156
|
|
1,039,877
|
|
1,047,488
|
|
|||||
|
|
|
|
|
|
||||||||||
Book value per common share – GAAP
|
$
|
37.21
|
|
$
|
36.11
|
|
$
|
35.26
|
|
$
|
34.23
|
|
$
|
33.67
|
|
Tangible book value per common share – Non-GAAP
|
$
|
18.24
|
|
$
|
18.19
|
|
$
|
17.53
|
|
$
|
16.65
|
|
$
|
16.19
|
|
(a)
|
Deferred tax liabilities are based on fully phased-in Basel III capital rules. Deferred tax liabilities at Dec. 31, 2017 have been remeasured at the lower statutory corporate tax rate.
|
Investment management and performance fees – Consolidated
|
|
|
4Q17 vs.
|
|||||
(dollars in millions)
|
4Q17
|
|
4Q16
|
|
4Q16
|
|
||
Investment management and performance fees – GAAP
|
$
|
962
|
|
$
|
848
|
|
13
|
%
|
Impact of changes in foreign currency exchange rates
|
—
|
|
21
|
|
|
|||
Investment management and performance fees, as adjusted – Non-GAAP
|
$
|
962
|
|
$
|
869
|
|
11
|
%
|
Investment management fees - Investment Management business
|
|
|
4Q17 vs.
|
|||||
(dollars in millions)
|
4Q17
|
|
4Q16
|
|
4Q16
|
|
||
Investment management fees – GAAP
|
$
|
898
|
|
$
|
801
|
|
12
|
%
|
Impact of changes in foreign currency exchange rates
|
—
|
|
20
|
|
|
|||
Investment management fees, as adjusted – Non-GAAP
|
$
|
898
|
|
$
|
821
|
|
9
|
%
|
Page -
26
|
BNY Mellon 4Q17 Earnings Release
|
Income from consolidated investment management funds, net of noncontrolling interests - Investment Management business
|
|||||||||||||||
(in millions)
|
4Q17
|
|
3Q17
|
|
2Q17
|
|
1Q17
|
|
4Q16
|
|
|||||
Investment management fees
|
$
|
—
|
|
$
|
1
|
|
$
|
2
|
|
$
|
2
|
|
$
|
4
|
|
Other (Investment income (loss))
|
8
|
|
6
|
|
5
|
|
13
|
|
(3
|
)
|
|||||
Income from consolidated investment management funds, net of noncontrolling interests
|
$
|
8
|
|
$
|
7
|
|
$
|
7
|
|
$
|
15
|
|
$
|
1
|
|
Pre-tax operating margin - Investment Management business
|
|
|
|
|
|
||||||||||
(dollars in millions)
|
4Q17
|
|
3Q17
|
|
2Q17
|
|
1Q17
|
|
4Q16
|
|
|||||
Income before income taxes – GAAP
|
$
|
276
|
|
$
|
300
|
|
$
|
288
|
|
$
|
277
|
|
$
|
260
|
|
Add: Amortization of intangible assets
|
15
|
|
15
|
|
15
|
|
15
|
|
22
|
|
|||||
Provision for credit losses
|
1
|
|
(2
|
)
|
—
|
|
3
|
|
6
|
|
|||||
Adjusted income before income taxes, excluding amortization of intangible assets and provision for credit losses – Non-GAAP
|
$
|
292
|
|
$
|
313
|
|
$
|
303
|
|
$
|
295
|
|
$
|
288
|
|
|
|
|
|
|
|
||||||||||
Total revenue – GAAP
|
$
|
1,048
|
|
$
|
1,000
|
|
$
|
986
|
|
$
|
963
|
|
$
|
960
|
|
Less: Distribution and servicing expense
|
107
|
|
110
|
|
104
|
|
101
|
|
98
|
|
|||||
Adjusted total revenue, net of distribution and servicing expense – Non-GAAP
|
$
|
941
|
|
$
|
890
|
|
$
|
882
|
|
$
|
862
|
|
$
|
862
|
|
|
|
|
|
|
|
||||||||||
Pre-tax operating margin – GAAP
(a)
|
26
|
%
|
30
|
%
|
29
|
%
|
29
|
%
|
27
|
%
|
|||||
Adjusted pre-tax operating margin, excluding amortization of intangible assets, provision for credit losses and distribution and servicing expense – Non-GAAP
(a)
|
31
|
%
|
35
|
%
|
34
|
%
|
34
|
%
|
33
|
%
|
•
|
$1,000.00
per share on the Series A Preferred Stock (equivalent to
$10.0000
per Normal Preferred Capital Security of Mellon Capital IV, each representing a 1/100th interest in a share of the Series A Preferred Stock);
|
•
|
$1,300.00
per share on the Series C Preferred Stock (equivalent to
$0.3250
per depositary share, each representing a 1/4,000th interest in a share of the Series C Preferred Stock); and
|
•
|
$2,312.50
per share on the Series F Preferred Stock (equivalent to
$23.1250
per depositary share, each representing a 1/100th interest in a share of the Series F Preferred Stock).
|
Page -
27
|
BNY Mellon 4Q17 Earnings Release
|
Page -
28
|
The Bank of New York Mellon Corporation
|
|
Quarterly Financial Trends
|
|
January 18, 2018
|
|
|
|
Table of Contents
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Results
|
|
Page
|
|
|
|
Consolidated Corporate Earnings - Quarterly Trend
|
|
3
|
Fee and Other Revenue
|
|
4
|
Average Balances and Interest Rates
|
|
5
|
Noninterest Expense
|
|
7
|
Assets Under Management, Custody and/or Administration and Securities Lending; Key Market Metrics
|
|
8
|
Assets Under Management Net Flows
|
|
9
|
|
|
|
Business Segment Results
|
|
|
|
|
|
Investment Management Business - Quarterly Trend
|
|
10
|
Investment Services Business - Quarterly Trend
|
|
11
|
Other Segment - Quarterly Trend
|
|
12
|
Full Year Trends
|
|
13
|
|
|
|
|
|
|
Nonperforming Assets
|
|
14
|
Allowance for Credit Losses, Provision and Net Charge-offs
|
|
15
|
Notes
|
|
16
|
Appendix - GAAP to Non-GAAP Reconciliations
|
|
17
|
|
|
|
|
|
2015
|
|
2016
|
|
2017
|
||||||||||||||||||||||||||||||||||||||||||
(dollar amounts in millions unless otherwise noted)
|
|
1st Qtr
|
|
2nd Qtr
|
|
3rd Qtr
|
|
4th Qtr
|
|
1st Qtr
|
|
2nd Qtr
|
|
3rd Qtr
|
|
4th Qtr
|
|
1st Qtr
|
|
2nd Qtr
|
|
3rd Qtr
|
|
4th Qtr
|
||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Investment services fees
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Asset servicing
|
|
$
|
1,038
|
|
|
$
|
1,060
|
|
|
$
|
1,057
|
|
|
$
|
1,032
|
|
|
$
|
1,040
|
|
|
$
|
1,069
|
|
|
$
|
1,067
|
|
|
$
|
1,068
|
|
|
$
|
1,063
|
|
|
$
|
1,085
|
|
|
$
|
1,105
|
|
|
$
|
1,130
|
|
Clearing services
|
|
344
|
|
|
347
|
|
|
345
|
|
|
339
|
|
|
350
|
|
|
350
|
|
|
349
|
|
|
355
|
|
|
376
|
|
|
394
|
|
|
383
|
|
|
400
|
|
||||||||||||
Issuer services
|
|
232
|
|
|
234
|
|
|
313
|
|
|
199
|
|
|
244
|
|
|
234
|
|
|
337
|
|
|
211
|
|
|
251
|
|
|
241
|
|
|
288
|
|
|
197
|
|
||||||||||||
Treasury services
|
|
137
|
|
|
144
|
|
|
137
|
|
|
137
|
|
|
131
|
|
|
139
|
|
|
137
|
|
|
140
|
|
|
139
|
|
|
140
|
|
|
141
|
|
|
137
|
|
||||||||||||
Total investment services fees
|
|
1,751
|
|
|
1,785
|
|
|
1,852
|
|
|
1,707
|
|
|
1,765
|
|
|
1,792
|
|
|
1,890
|
|
|
1,774
|
|
|
1,829
|
|
|
1,860
|
|
|
1,917
|
|
|
1,864
|
|
||||||||||||
Investment management and performance fees
(a)
|
|
867
|
|
|
878
|
|
|
829
|
|
|
864
|
|
|
812
|
|
|
830
|
|
|
860
|
|
|
848
|
|
|
842
|
|
|
879
|
|
|
901
|
|
|
962
|
|
||||||||||||
Foreign exchange & other trading revenue
|
|
229
|
|
|
187
|
|
|
179
|
|
|
173
|
|
|
175
|
|
|
182
|
|
|
183
|
|
|
161
|
|
|
164
|
|
|
165
|
|
|
173
|
|
|
166
|
|
||||||||||||
Distribution and servicing
|
|
41
|
|
|
39
|
|
|
41
|
|
|
41
|
|
|
39
|
|
|
43
|
|
|
43
|
|
|
41
|
|
|
41
|
|
|
41
|
|
|
40
|
|
|
38
|
|
||||||||||||
Financing-related fees
|
|
40
|
|
|
58
|
|
|
71
|
|
|
51
|
|
|
54
|
|
|
57
|
|
|
58
|
|
|
50
|
|
|
55
|
|
|
53
|
|
|
54
|
|
|
54
|
|
||||||||||||
Investment and other income
(a)
|
|
60
|
|
|
104
|
|
|
59
|
|
|
93
|
|
|
105
|
|
|
74
|
|
|
92
|
|
|
70
|
|
|
77
|
|
|
122
|
|
|
63
|
|
|
(198
|
)
|
||||||||||||
Total fee revenue
(a)
|
|
2,988
|
|
|
3,051
|
|
|
3,031
|
|
|
2,929
|
|
|
2,950
|
|
|
2,978
|
|
|
3,126
|
|
|
2,944
|
|
|
3,008
|
|
|
3,120
|
|
|
3,148
|
|
|
2,886
|
|
||||||||||||
Net securities gains
|
|
24
|
|
|
16
|
|
|
22
|
|
|
21
|
|
|
20
|
|
|
21
|
|
|
24
|
|
|
10
|
|
|
10
|
|
|
—
|
|
|
19
|
|
|
(26
|
)
|
||||||||||||
Total fee and other revenue
(a)
|
|
3,012
|
|
|
3,067
|
|
|
3,053
|
|
|
2,950
|
|
|
2,970
|
|
|
2,999
|
|
|
3,150
|
|
|
2,954
|
|
|
3,018
|
|
|
3,120
|
|
|
3,167
|
|
|
2,860
|
|
||||||||||||
Income (loss) from consolidated investment management funds
(a)
|
|
52
|
|
|
40
|
|
|
(22
|
)
|
|
16
|
|
|
(6
|
)
|
|
10
|
|
|
17
|
|
|
5
|
|
|
33
|
|
|
10
|
|
|
10
|
|
|
17
|
|
||||||||||||
Net interest revenue
|
|
728
|
|
|
779
|
|
|
759
|
|
|
760
|
|
|
766
|
|
|
767
|
|
|
774
|
|
|
831
|
|
|
792
|
|
|
826
|
|
|
839
|
|
|
851
|
|
||||||||||||
Total revenue
(a)
|
|
3,792
|
|
|
3,886
|
|
|
3,790
|
|
|
3,726
|
|
|
3,730
|
|
|
3,776
|
|
|
3,941
|
|
|
3,790
|
|
|
3,843
|
|
|
3,956
|
|
|
4,016
|
|
|
3,728
|
|
||||||||||||
Provision for credit losses
|
|
2
|
|
|
(6
|
)
|
|
1
|
|
|
163
|
|
|
10
|
|
|
(9
|
)
|
|
(19
|
)
|
|
7
|
|
|
(5
|
)
|
|
(7
|
)
|
|
(6
|
)
|
|
(6
|
)
|
||||||||||||
Noninterest expense
|
|
2,637
|
|
|
2,603
|
|
|
2,603
|
|
|
2,610
|
|
|
2,555
|
|
|
2,554
|
|
|
2,564
|
|
|
2,564
|
|
|
2,582
|
|
|
2,590
|
|
|
2,596
|
|
|
2,874
|
|
||||||||||||
Amortization of intangible assets
|
|
66
|
|
|
65
|
|
|
66
|
|
|
64
|
|
|
57
|
|
|
59
|
|
|
61
|
|
|
60
|
|
|
52
|
|
|
53
|
|
|
52
|
|
|
52
|
|
||||||||||||
Merger & integration, litigation and restructuring charges
|
|
(3
|
)
|
|
59
|
|
|
11
|
|
|
18
|
|
|
17
|
|
|
7
|
|
|
18
|
|
|
7
|
|
|
8
|
|
|
12
|
|
|
6
|
|
|
80
|
|
||||||||||||
Total noninterest expense
|
|
2,700
|
|
|
2,727
|
|
|
2,680
|
|
|
2,692
|
|
|
2,629
|
|
|
2,620
|
|
|
2,643
|
|
|
2,631
|
|
|
2,642
|
|
|
2,655
|
|
|
2,654
|
|
|
3,006
|
|
||||||||||||
Income before taxes
|
|
1,090
|
|
|
1,165
|
|
|
1,109
|
|
|
871
|
|
|
1,091
|
|
|
1,165
|
|
|
1,317
|
|
|
1,152
|
|
|
1,206
|
|
|
1,308
|
|
|
1,368
|
|
|
728
|
|
||||||||||||
Provision for income taxes
|
|
280
|
|
|
276
|
|
|
282
|
|
|
175
|
|
|
283
|
|
|
290
|
|
|
324
|
|
|
280
|
|
|
269
|
|
|
332
|
|
|
348
|
|
|
(453
|
)
|
||||||||||||
Net income
|
|
810
|
|
|
889
|
|
|
827
|
|
|
696
|
|
|
808
|
|
|
875
|
|
|
993
|
|
|
872
|
|
|
937
|
|
|
976
|
|
|
1,020
|
|
|
1,181
|
|
||||||||||||
Net income (loss) attributable to noncontrolling interest
(a)(b)
|
|
(31
|
)
|
|
(36
|
)
|
|
6
|
|
|
(3
|
)
|
|
9
|
|
|
(2
|
)
|
|
(6
|
)
|
|
(2
|
)
|
|
(15
|
)
|
|
(1
|
)
|
|
(2
|
)
|
|
(6
|
)
|
||||||||||||
Preferred stock dividends
|
|
(13
|
)
|
|
(23
|
)
|
|
(13
|
)
|
|
(56
|
)
|
|
(13
|
)
|
|
(48
|
)
|
|
(13
|
)
|
|
(48
|
)
|
|
(42
|
)
|
|
(49
|
)
|
|
(35
|
)
|
|
(49
|
)
|
||||||||||||
Net income applicable to common shareholders of The Bank of New York Mellon Corporation
|
|
$
|
766
|
|
|
$
|
830
|
|
|
$
|
820
|
|
|
$
|
637
|
|
|
$
|
804
|
|
|
$
|
825
|
|
|
$
|
974
|
|
|
$
|
822
|
|
|
$
|
880
|
|
|
$
|
926
|
|
|
$
|
983
|
|
|
$
|
1,126
|
|
Earnings per share
(c)
|
|
$
|
0.67
|
|
|
$
|
0.73
|
|
|
$
|
0.74
|
|
|
$
|
0.57
|
|
|
$
|
0.73
|
|
|
$
|
0.75
|
|
|
$
|
0.90
|
|
|
$
|
0.77
|
|
|
$
|
0.83
|
|
|
$
|
0.88
|
|
|
$
|
0.94
|
|
|
$
|
1.08
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Pre-tax operating margin
(a)
|
|
29
|
%
|
|
30
|
%
|
|
29
|
%
|
|
23
|
%
|
|
29
|
%
|
|
31
|
%
|
|
33
|
%
|
|
30
|
%
|
|
31
|
%
|
|
33
|
%
|
|
34
|
%
|
|
20
|
%
|
||||||||||||
Adjusted pre-tax operating margin - Non-GAAP
(a)(d)
|
|
30
|
%
|
|
33
|
%
|
|
31
|
%
|
|
30
|
%
|
|
31
|
%
|
|
33
|
%
|
|
35
|
%
|
|
32
|
%
|
|
33
|
%
|
|
35
|
%
|
|
35
|
%
|
|
23
|
%
|
||||||||||||
Return on common equity (annualized) - GAAP
|
|
8.8
|
%
|
|
9.4
|
%
|
|
9.1
|
%
|
|
7.1
|
%
|
|
9.2
|
%
|
|
9.3
|
%
|
|
10.8
|
%
|
|
9.3
|
%
|
|
10.2
|
%
|
|
10.4
|
%
|
|
10.6
|
%
|
|
12.1
|
%
|
||||||||||||
Return on tangible common equity
(annualized)
- Non-GAAP
(d)
|
|
20.3
|
%
|
|
21.5
|
%
|
|
20.8
|
%
|
|
16.2
|
%
|
|
20.6
|
%
|
|
20.4
|
%
|
|
23.5
|
%
|
|
20.4
|
%
|
|
22.2
|
%
|
|
21.9
|
%
|
|
21.9
|
%
|
|
25.9
|
%
|
||||||||||||
Percent of non-US total revenue
|
|
36
|
%
|
|
36
|
%
|
|
37
|
%
|
|
34
|
%
|
|
33
|
%
|
|
34
|
%
|
|
36
|
%
|
|
34
|
%
|
|
34
|
%
|
|
35
|
%
|
|
36
|
%
|
|
39
|
%
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
(a) The first quarter of 2015 was restated to reflect the retrospective application of adopting new accounting guidance related to Consolidations (ASU 2015-02).
|
||||||||||||||||||||||||||||||||||||||||||||||||
(b) Primarily attributable to noncontrolling interests related to consolidated investment management funds.
|
||||||||||||||||||||||||||||||||||||||||||||||||
(c) The second quarter of 2015 includes a $0.03 per share charge related to litigation and restructuring. The fourth quarter of 2015 includes an $0.11 per share charge for the impairment charge related to a court decision regarding Sentinel, litigation and restructuring charges. The first quarter, second quarter and third quarter of 2016 each include a $0.01 per share charge related to litigation and restructuring. The third quarter of 2016 also includes a $0.01 per share recovery of the previously impaired Sentinel loan. The first quarter of 2017 includes a $0.03 per share tax benefit on stock compensation. The fourth quarter of 2017 includes a $0.41 per share estimated net benefit related to U.S. tax legislation and a $0.24 charge related to severance, litigation and other charges.
The fourth quarter of 2017 other charges include an asset impairment and investment securities losses related to the sale of certain securities.
|
||||||||||||||||||||||||||||||||||||||||||||||||
(d) Non-GAAP excludes net (loss) income attributable to noncontrolling interests related to consolidated investment management funds, M&I, litigation and restructuring charges (recoveries), amortization of intangible assets, the impairment charge related to a court decision regarding Sentinel, and a recovery of the previously impaired Sentinel loan, if applicable. See "Supplemental information - Explanation of GAAP and Non-GAAP financial measures" beginning on page 23 of the Quarterly Earnings Release dated January 18, 2018 for the fourth quarter of 2017 (the "Quarterly Earnings Release"), furnished as an exhibit to the Current Report on Form 8-K to which these Quarterly Financial Trends are furnished as an exhibit. Also, see "Appendix - GAAP to Non-GAAP Reconciliations" beginning on page 17 for the reconciliation of Non-GAAP measures.
|
||||||||||||||||||||||||||||||||||||||||||||||||
Note: See pages 4 through 7 for additional details of revenue/expense items impacting consolidated results.
|
3
|
|
|
2015
|
|
2016
|
|
2017
|
||||||||||||||||||||||||||||||||||||||||||
(dollar amounts in millions unless otherwise noted)
|
|
1st Qtr
|
|
2nd Qtr
|
|
3rd Qtr
|
|
4th Qtr
|
|
1st Qtr
|
|
2nd Qtr
|
|
3rd Qtr
|
|
4th Qtr
|
|
1st Qtr
|
|
2nd Qtr
|
|
3rd Qtr
|
|
4th Qtr
|
||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Investment services fees:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Asset servicing
|
|
$
|
995
|
|
|
$
|
1,011
|
|
|
$
|
1,019
|
|
|
$
|
986
|
|
|
$
|
990
|
|
|
$
|
1,017
|
|
|
$
|
1,016
|
|
|
$
|
1,014
|
|
|
$
|
1,014
|
|
|
1,037
|
|
|
$
|
1,058
|
|
|
$
|
1,079
|
|
|
Securities lending
|
|
43
|
|
|
49
|
|
|
38
|
|
|
46
|
|
|
50
|
|
|
52
|
|
|
51
|
|
|
54
|
|
|
49
|
|
|
48
|
|
|
47
|
|
|
51
|
|
||||||||||||
Clearing services
|
|
344
|
|
|
347
|
|
|
345
|
|
|
339
|
|
|
350
|
|
|
350
|
|
|
349
|
|
|
355
|
|
|
376
|
|
|
394
|
|
|
383
|
|
|
400
|
|
||||||||||||
Issuer services
|
|
232
|
|
|
234
|
|
|
313
|
|
|
199
|
|
|
244
|
|
|
234
|
|
|
337
|
|
|
211
|
|
|
251
|
|
|
241
|
|
|
288
|
|
|
197
|
|
||||||||||||
Treasury services
|
|
137
|
|
|
144
|
|
|
137
|
|
|
137
|
|
|
131
|
|
|
139
|
|
|
137
|
|
|
140
|
|
|
139
|
|
|
140
|
|
|
141
|
|
|
137
|
|
||||||||||||
Total investment services fees
|
|
1,751
|
|
|
1,785
|
|
|
1,852
|
|
|
1,707
|
|
|
1,765
|
|
|
1,792
|
|
|
1,890
|
|
|
1,774
|
|
|
1,829
|
|
|
1,860
|
|
|
1,917
|
|
|
1,864
|
|
||||||||||||
Investment management and performance fees
(a)
|
|
867
|
|
|
878
|
|
|
829
|
|
|
864
|
|
|
812
|
|
|
830
|
|
|
860
|
|
|
848
|
|
|
842
|
|
|
879
|
|
|
901
|
|
|
962
|
|
||||||||||||
Foreign exchange and other trading revenue
|
|
229
|
|
|
187
|
|
|
179
|
|
|
173
|
|
|
175
|
|
|
182
|
|
|
183
|
|
|
161
|
|
|
164
|
|
|
165
|
|
|
173
|
|
|
166
|
|
||||||||||||
Distribution and servicing
|
|
41
|
|
|
39
|
|
|
41
|
|
|
41
|
|
|
39
|
|
|
43
|
|
|
43
|
|
|
41
|
|
|
41
|
|
|
41
|
|
|
40
|
|
|
38
|
|
||||||||||||
Financing-related fees
|
|
40
|
|
|
58
|
|
|
71
|
|
|
51
|
|
|
54
|
|
|
57
|
|
|
58
|
|
|
50
|
|
|
55
|
|
|
53
|
|
|
54
|
|
|
54
|
|
||||||||||||
Investment and other income
(a)
|
|
60
|
|
|
104
|
|
|
59
|
|
|
93
|
|
|
105
|
|
|
74
|
|
|
92
|
|
|
70
|
|
|
77
|
|
|
122
|
|
|
63
|
|
|
(198
|
)
|
||||||||||||
Total fee revenue
(a)
|
|
2,988
|
|
|
3,051
|
|
|
3,031
|
|
|
2,929
|
|
|
2,950
|
|
|
2,978
|
|
|
3,126
|
|
|
2,944
|
|
|
3,008
|
|
|
3,120
|
|
|
3,148
|
|
|
2,886
|
|
||||||||||||
Net securities gains
|
|
24
|
|
|
16
|
|
|
22
|
|
|
21
|
|
|
20
|
|
|
21
|
|
|
24
|
|
|
10
|
|
|
10
|
|
|
—
|
|
|
19
|
|
|
(26
|
)
|
||||||||||||
Total fee and other revenue
(a)
|
|
$
|
3,012
|
|
|
$
|
3,067
|
|
|
$
|
3,053
|
|
|
$
|
2,950
|
|
|
$
|
2,970
|
|
|
$
|
2,999
|
|
|
$
|
3,150
|
|
|
$
|
2,954
|
|
|
$
|
3,018
|
|
|
$
|
3,120
|
|
|
$
|
3,167
|
|
|
$
|
2,860
|
|
Fee revenue as a percentage of total revenue
|
|
79
|
%
|
|
79
|
%
|
|
81
|
%
|
|
79
|
%
|
|
79
|
%
|
|
79
|
%
|
|
79
|
%
|
|
78
|
%
|
|
78
|
%
|
|
79
|
%
|
|
78
|
%
|
|
77
|
%
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
(a) The first quarter of 2015 was restated to reflect the retrospective application of adopting new accounting guidance related to Consolidations (ASU 2015-02).
|
4
|
5
|
6
|
|
|
2015
|
|
2016
|
|
2017
|
||||||||||||||||||||||||||||||||||||||||||
(dollar amounts in millions)
|
|
1st Qtr
|
|
2nd Qtr
|
|
3rd Qtr
|
|
4th Qtr
|
|
1st Qtr
|
|
2nd Qtr
|
|
3rd Qtr
|
|
4th Qtr
|
|
1st Qtr
|
|
2nd Qtr
|
|
3rd Qtr
|
|
4th Qtr
|
||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Staff
|
|
$
|
1,485
|
|
|
$
|
1,434
|
|
|
$
|
1,437
|
|
|
$
|
1,481
|
|
|
$
|
1,459
|
|
|
$
|
1,412
|
|
|
$
|
1,467
|
|
|
$
|
1,395
|
|
|
$
|
1,472
|
|
|
$
|
1,417
|
|
|
$
|
1,469
|
|
|
$
|
1,614
|
|
Professional, legal and other purchased services
|
|
302
|
|
|
299
|
|
|
301
|
|
|
328
|
|
|
278
|
|
|
290
|
|
|
292
|
|
|
325
|
|
|
312
|
|
|
319
|
|
|
305
|
|
|
338
|
|
||||||||||||
Software and equipment
|
|
228
|
|
|
228
|
|
|
226
|
|
|
225
|
|
|
219
|
|
|
223
|
|
|
215
|
|
|
237
|
|
|
223
|
|
|
232
|
|
|
233
|
|
|
297
|
|
||||||||||||
Net occupancy
|
|
151
|
|
|
149
|
|
|
152
|
|
|
148
|
|
|
142
|
|
|
152
|
|
|
143
|
|
|
153
|
|
|
136
|
|
|
139
|
|
|
141
|
|
|
153
|
|
||||||||||||
Distribution and servicing
|
|
98
|
|
|
96
|
|
|
95
|
|
|
92
|
|
|
100
|
|
|
102
|
|
|
105
|
|
|
98
|
|
|
100
|
|
|
104
|
|
|
109
|
|
|
106
|
|
||||||||||||
Sub-custodian
|
|
70
|
|
|
75
|
|
|
65
|
|
|
60
|
|
|
59
|
|
|
70
|
|
|
59
|
|
|
57
|
|
|
64
|
|
|
65
|
|
|
62
|
|
|
59
|
|
||||||||||||
Bank assessment charges
|
|
55
|
|
|
59
|
|
|
41
|
|
|
2
|
|
|
53
|
|
|
52
|
|
|
61
|
|
|
53
|
|
|
57
|
|
|
59
|
|
|
51
|
|
|
53
|
|
||||||||||||
Business development
|
|
61
|
|
|
72
|
|
|
59
|
|
|
75
|
|
|
57
|
|
|
65
|
|
|
52
|
|
|
71
|
|
|
51
|
|
|
63
|
|
|
49
|
|
|
66
|
|
||||||||||||
Other
|
|
187
|
|
|
191
|
|
|
227
|
|
|
199
|
|
|
188
|
|
|
188
|
|
|
170
|
|
|
175
|
|
|
167
|
|
|
192
|
|
|
177
|
|
|
188
|
|
||||||||||||
Amortization of intangible assets
|
|
66
|
|
|
65
|
|
|
66
|
|
|
64
|
|
|
57
|
|
|
59
|
|
|
61
|
|
|
60
|
|
|
52
|
|
|
53
|
|
|
52
|
|
|
52
|
|
||||||||||||
Merger & integration, litigation and restructuring (recoveries) charges
|
|
(3
|
)
|
|
59
|
|
|
11
|
|
|
18
|
|
|
17
|
|
|
7
|
|
|
18
|
|
|
7
|
|
|
8
|
|
|
12
|
|
|
6
|
|
|
80
|
|
||||||||||||
Total noninterest expense - GAAP
|
|
$
|
2,700
|
|
|
$
|
2,727
|
|
|
$
|
2,680
|
|
|
$
|
2,692
|
|
|
$
|
2,629
|
|
|
$
|
2,620
|
|
|
$
|
2,643
|
|
|
$
|
2,631
|
|
|
$
|
2,642
|
|
|
$
|
2,655
|
|
|
$
|
2,654
|
|
|
$
|
3,006
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Memo:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Total noninterest expense excluding amortization of intangible assets and M&I, litigation and restructuring (recoveries) charges - Non-GAAP
(a)
|
|
$
|
2,637
|
|
|
$
|
2,603
|
|
|
$
|
2,603
|
|
|
$
|
2,610
|
|
|
$
|
2,555
|
|
|
$
|
2,554
|
|
|
$
|
2,564
|
|
|
$
|
2,564
|
|
|
$
|
2,582
|
|
|
$
|
2,590
|
|
|
$
|
2,596
|
|
|
$
|
2,874
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Full-time employees at period-end
|
|
50,500
|
|
|
50,700
|
|
|
51,300
|
|
|
51,200
|
|
|
52,100
|
|
|
52,200
|
|
|
52,300
|
|
|
52,000
|
|
|
52,600
|
|
|
52,800
|
|
|
52,900
|
|
|
52,500
|
|
||||||||||||
|
||||||||||||||||||||||||||||||||||||||||||||||||
(a) See "Appendix - GAAP to Non-GAAP Reconciliations" beginning on page 17 for the reconciliation of Non-GAAP measures.
|
||||||||||||||||||||||||||||||||||||||||||||||||
|
7
|
|
|
2015
|
|
2016
|
|
2017
|
|
||||||||||||||||||||||||||||||||||||||||||
(dollar amounts in billions unless otherwise noted)
|
|
1st Qtr
|
|
2nd Qtr
|
|
3rd Qtr
|
|
4th Qtr
|
|
1st Qtr
|
|
2nd Qtr
|
|
3rd Qtr
|
|
4th Qtr
|
|
1st Qtr
|
|
2nd Qtr
|
|
3rd Qtr
|
|
4th Qtr
|
|
||||||||||||||||||||||||
Assets under management at period end:
(a)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Institutional
|
|
$
|
1,188
|
|
|
$
|
1,163
|
|
|
$
|
1,129
|
|
|
$
|
1,127
|
|
|
$
|
1,155
|
|
|
$
|
1,182
|
|
|
$
|
1,234
|
|
|
$
|
1,182
|
|
|
$
|
1,243
|
|
|
$
|
1,265
|
|
|
$
|
1,285
|
|
|
$
|
1,346
|
|
|
Mutual Funds
|
|
445
|
|
|
454
|
|
|
419
|
|
|
420
|
|
|
405
|
|
|
398
|
|
|
396
|
|
|
381
|
|
|
397
|
|
|
418
|
|
|
447
|
|
|
453
|
|
|
||||||||||||
Private Client
|
|
84
|
|
|
83
|
|
|
77
|
|
|
78
|
|
|
79
|
|
|
84
|
|
|
85
|
|
|
85
|
|
|
87
|
|
|
88
|
|
|
92
|
|
|
94
|
|
|
||||||||||||
Assets under management
|
|
$
|
1,717
|
|
|
$
|
1,700
|
|
|
$
|
1,625
|
|
|
$
|
1,625
|
|
|
$
|
1,639
|
|
|
$
|
1,664
|
|
|
$
|
1,715
|
|
|
$
|
1,648
|
|
|
$
|
1,727
|
|
|
$
|
1,771
|
|
|
$
|
1,824
|
|
|
$
|
1,893
|
|
(b)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
AUM at period end, by product type:
(a)(c)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Equity
|
|
10
|
%
|
|
10
|
%
|
|
9
|
%
|
|
9
|
%
|
|
9
|
%
|
|
9
|
%
|
|
9
|
%
|
|
9
|
%
|
|
9
|
%
|
|
9
|
%
|
|
9
|
%
|
|
9
|
%
|
|
||||||||||||
Fixed income
|
|
12
|
|
|
11
|
|
|
12
|
|
|
12
|
|
|
12
|
|
|
12
|
|
|
11
|
|
|
11
|
|
|
11
|
|
|
11
|
|
|
11
|
|
|
11
|
|
|
||||||||||||
Index
|
|
21
|
|
|
21
|
|
|
19
|
|
|
20
|
|
|
19
|
|
|
18
|
|
|
18
|
|
|
19
|
|
|
19
|
|
|
18
|
|
|
18
|
|
|
18
|
|
|
||||||||||||
Liability-driven investments
(d)
|
|
30
|
|
|
30
|
|
|
32
|
|
|
31
|
|
|
33
|
|
|
34
|
|
|
35
|
|
|
34
|
|
|
34
|
|
|
35
|
|
|
35
|
|
|
35
|
|
|
||||||||||||
Multi-asset and alternative investments
|
|
10
|
|
|
11
|
|
|
11
|
|
|
11
|
|
|
11
|
|
|
11
|
|
|
11
|
|
|
11
|
|
|
11
|
|
|
11
|
|
|
11
|
|
|
11
|
|
|
||||||||||||
Cash
|
|
17
|
|
|
17
|
|
|
17
|
|
|
17
|
|
|
16
|
|
|
16
|
|
|
16
|
|
|
16
|
|
|
16
|
|
|
16
|
|
|
16
|
|
|
16
|
|
|
||||||||||||
Total AUM
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
(b)
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Assets under custody and/or administration at period end (in trillions)
(e)
|
|
$
|
28.5
|
|
|
$
|
28.6
|
|
|
$
|
28.5
|
|
|
$
|
28.9
|
|
|
$
|
29.1
|
|
|
$
|
29.5
|
|
|
$
|
30.5
|
|
|
$
|
29.9
|
|
|
$
|
30.6
|
|
|
$
|
31.1
|
|
|
$
|
32.2
|
|
|
$
|
33.3
|
|
(b)
|
Market value of securities on loan at period end
(f)
|
|
$
|
291
|
|
|
$
|
283
|
|
|
$
|
288
|
|
|
$
|
277
|
|
|
$
|
300
|
|
|
$
|
278
|
|
|
$
|
288
|
|
|
$
|
296
|
|
|
$
|
314
|
|
|
$
|
336
|
|
|
$
|
382
|
|
|
$
|
408
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Key Market Metrics
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
S&P 500 Index
(g)
|
|
2068
|
|
|
2063
|
|
|
1920
|
|
|
2044
|
|
|
2060
|
|
|
2099
|
|
|
2168
|
|
|
2239
|
|
|
2363
|
|
|
2423
|
|
|
2519
|
|
|
2674
|
|
|
||||||||||||
S&P 500 Index - daily average
|
|
2064
|
|
|
2102
|
|
|
2027
|
|
|
2052
|
|
|
1951
|
|
|
2075
|
|
|
2162
|
|
|
2185
|
|
|
2326
|
|
|
2398
|
|
|
2467
|
|
|
2603
|
|
|
||||||||||||
FTSE 100 Index
(g)
|
|
6773
|
|
|
6521
|
|
|
6062
|
|
|
6242
|
|
|
6175
|
|
|
6504
|
|
|
6899
|
|
|
7143
|
|
|
7323
|
|
|
7313
|
|
|
7373
|
|
|
7688
|
|
|
||||||||||||
FTSE 100 Index-daily average
|
|
6793
|
|
|
6920
|
|
|
6399
|
|
|
6271
|
|
|
5988
|
|
|
6204
|
|
|
6765
|
|
|
6923
|
|
|
7274
|
|
|
7391
|
|
|
7380
|
|
|
7477
|
|
|
||||||||||||
MSCI EAFE
(g)
|
|
1849
|
|
|
1842
|
|
|
1644
|
|
|
1716
|
|
|
1652
|
|
|
1608
|
|
|
1702
|
|
|
1684
|
|
|
1793
|
|
|
1883
|
|
|
1974
|
|
|
2051
|
|
|
||||||||||||
MSCI EAFE-daily average
|
|
1818
|
|
|
1905
|
|
|
1785
|
|
|
1732
|
|
|
1593
|
|
|
1648
|
|
|
1677
|
|
|
1660
|
|
|
1749
|
|
|
1856
|
|
|
1934
|
|
|
2005
|
|
|
||||||||||||
Barclays Capital Global Aggregate Bond
SM
Index
(g)(h)
|
|
448
|
|
|
442
|
|
|
446
|
|
|
442
|
|
|
468
|
|
|
482
|
|
|
486
|
|
|
451
|
|
|
459
|
|
|
471
|
|
|
480
|
|
|
485
|
|
|
||||||||||||
NYSE & NASDAQ Share Volume
(in billions)
|
|
187
|
|
|
185
|
|
|
206
|
|
|
198
|
|
|
218
|
|
|
203
|
|
|
186
|
|
|
189
|
|
|
186
|
|
|
199
|
|
|
179
|
|
|
188
|
|
|
||||||||||||
JP Morgan G7 Volatility Index - daily average
(i)
|
|
10.40
|
|
|
10.06
|
|
|
9.93
|
|
|
9.49
|
|
|
10.60
|
|
|
11.12
|
|
|
10.19
|
|
|
10.24
|
|
|
10.10
|
|
|
7.98
|
|
|
8.17
|
|
|
7.41
|
|
|
||||||||||||
Average interest on excess reserves paid by the Federal Reserve
|
|
0.25
|
%
|
|
0.25
|
%
|
|
0.25
|
%
|
|
0.29
|
%
|
|
0.50
|
%
|
|
0.50
|
%
|
|
0.50
|
%
|
|
0.55
|
%
|
|
0.79
|
%
|
|
1.04
|
%
|
|
1.25
|
%
|
|
1.30
|
%
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Foreign exchange rates vs. U.S. dollar:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
British pound
(g)
|
|
$
|
1.48
|
|
|
$
|
1.57
|
|
|
$
|
1.52
|
|
|
$
|
1.48
|
|
|
$
|
1.44
|
|
|
$
|
1.34
|
|
|
$
|
1.30
|
|
|
$
|
1.23
|
|
|
$
|
1.25
|
|
|
$
|
1.30
|
|
|
$
|
1.34
|
|
|
$
|
1.35
|
|
|
British pound - average rate
|
|
1.51
|
|
|
1.53
|
|
|
1.55
|
|
|
1.52
|
|
|
1.43
|
|
|
1.43
|
|
|
1.31
|
|
|
1.24
|
|
|
1.24
|
|
|
1.28
|
|
|
1.31
|
|
|
1.33
|
|
|
||||||||||||
Euro
(g)
|
|
1.07
|
|
|
1.11
|
|
|
1.12
|
|
|
1.09
|
|
|
1.14
|
|
|
1.11
|
|
|
1.12
|
|
|
1.05
|
|
|
1.07
|
|
|
1.14
|
|
|
1.18
|
|
|
1.20
|
|
|
||||||||||||
Euro - average rate
|
|
1.13
|
|
|
1.11
|
|
|
1.11
|
|
|
1.10
|
|
|
1.10
|
|
|
1.13
|
|
|
1.12
|
|
|
1.08
|
|
|
1.07
|
|
|
1.10
|
|
|
1.17
|
|
|
1.18
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
(a) Excludes securities lending cash management assets and assets managed in the Investment Services business. In the third quarter of 2015, prior period AUM was restated to reflect the reclassification of Meriten from the Investment Management business to the Other segment.
|
|||||||||||||||||||||||||||||||||||||||||||||||||
(b) Preliminary.
|
|||||||||||||||||||||||||||||||||||||||||||||||||
(c) In the first quarter of 2017, the AUM in our Wealth Management business and our multi-class funds has been reclassified to multi-asset and alternative investments. This reclassification does not change total AUM. All prior periods have been restated.
|
|||||||||||||||||||||||||||||||||||||||||||||||||
(d) Includes currency overlay assets under management.
|
|||||||||||||||||||||||||||||||||||||||||||||||||
(e) Includes the AUC/A of CIBC Mellon Global Securities Services Company ("CIBC Mellon"), a joint venture with the Canadian Imperial Bank of Commerce, of $1.1 trillion at March 31, 2015 and June 30, 2015, $1.0 trillion at Sept. 30, 2015 and Dec. 31, 2015, $1.1 trillion at March 31, 2016 and June 30, 2016, $1.2 trillion at Sept. 30, 2016, Dec. 31, 2016, March 31, 2017 and June 30, 2017, and $1.3 trillion at Sept. 30, 2017 and Dec. 31, 2017.
|
|||||||||||||||||||||||||||||||||||||||||||||||||
(f) Represents the total amount of securities on loan in our agency securities lending program managed by the Investment Services business. Excludes securities for which BNY Mellon acts as agent on behalf of CIBC Mellon clients, which totaled $69 billion at March 31, 2015, $68 billion at June 30, 2015, $61 billion at Sept. 30, 2015, $55 billion at Dec. 31, 2015, $56 billion at March 31, 2016 and June 30, 2016, $64 billion at Sept. 30, 2016, $63 billion at Dec. 31, 2016, $65 billion at March 31, 2017, $66 billion at June 30, 2017, $68 billion at Sept. 30, 2017 and $71 billion at Dec. 31, 2017.
|
|||||||||||||||||||||||||||||||||||||||||||||||||
(g) Period end.
|
|||||||||||||||||||||||||||||||||||||||||||||||||
(h) Unhedged in U.S. dollar terms.
|
|||||||||||||||||||||||||||||||||||||||||||||||||
(i) The JP Morgan G7 Volatility Index is based on the implied volatility in 3-month currency options.
|
8
|
|
|
2015
|
|
2016
|
|
2017
|
|
||||||||||||||||||||||||||||||||||||||||||||
(dollar amounts in billions)
|
|
1st Qtr
|
|
2nd Qtr
|
|
3rd Qtr
|
|
4th Qtr
|
|
1st Qtr
|
|
2nd Qtr
|
|
3rd Qtr
|
|
4th Qtr
|
|
1st Qtr
|
|
2nd Qtr
|
|
3rd Qtr
|
|
4th Qtr
|
|
||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||
Beginning balance of AUM
(a)(b)
|
|
$
|
1,686
|
|
|
$
|
1,717
|
|
|
$
|
1,700
|
|
|
$
|
1,625
|
|
|
$
|
1,625
|
|
|
$
|
1,639
|
|
|
$
|
1,664
|
|
|
$
|
1,715
|
|
|
$
|
1,648
|
|
|
$
|
1,727
|
|
|
$
|
1,771
|
|
|
$
|
1,824
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||
Net inflows (outflows):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||
Long-term strategies:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||
Equity
|
|
(5
|
)
|
|
(11
|
)
|
|
(5
|
)
|
|
(10
|
)
|
|
(2
|
)
|
|
(2
|
)
|
|
(6
|
)
|
|
(5
|
)
|
|
(4
|
)
|
|
(2
|
)
|
|
(2
|
)
|
|
(6
|
)
|
|
||||||||||||||
Fixed income
|
|
3
|
|
|
(2
|
)
|
|
(4
|
)
|
|
2
|
|
|
—
|
|
|
(3
|
)
|
|
(1
|
)
|
|
(1
|
)
|
|
2
|
|
|
2
|
|
|
4
|
|
|
(2
|
)
|
|
||||||||||||||
Liability-driven investments
(c)
|
|
8
|
|
|
5
|
|
|
11
|
|
|
11
|
|
|
14
|
|
|
15
|
|
|
4
|
|
|
(7
|
)
|
|
14
|
|
|
15
|
|
|
(2
|
)
|
|
23
|
|
|
||||||||||||||
Multi-asset and alternative investments
|
|
1
|
|
|
2
|
|
|
2
|
|
|
4
|
|
|
—
|
|
|
2
|
|
|
7
|
|
|
3
|
|
|
2
|
|
|
1
|
|
|
3
|
|
|
2
|
|
|
||||||||||||||
Total long-term active inflows (outflows)
|
|
7
|
|
|
(6
|
)
|
|
4
|
|
|
7
|
|
|
12
|
|
—
|
|
12
|
|
—
|
|
4
|
|
|
(10
|
)
|
|
14
|
|
|
16
|
|
|
3
|
|
|
17
|
|
|
||||||||||||
Index
|
|
8
|
|
|
(10
|
)
|
|
(10
|
)
|
|
(17
|
)
|
|
(11
|
)
|
|
(17
|
)
|
|
(3
|
)
|
|
(1
|
)
|
|
—
|
|
|
(13
|
)
|
|
(3
|
)
|
|
(1
|
)
|
|
||||||||||||||
Total long-term strategies inflows (outflows)
|
|
15
|
|
|
(16
|
)
|
|
(6
|
)
|
|
(10
|
)
|
|
1
|
|
—
|
|
(5
|
)
|
—
|
|
1
|
|
|
(11
|
)
|
|
14
|
|
|
3
|
|
|
—
|
|
|
16
|
|
|
||||||||||||
Short-term strategies:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||
Cash
|
|
1
|
|
|
(11
|
)
|
|
(9
|
)
|
|
1
|
|
|
(9
|
)
|
|
4
|
|
|
(1
|
)
|
|
(3
|
)
|
|
13
|
|
|
11
|
|
|
10
|
|
|
(4
|
)
|
|
||||||||||||||
Total net inflows (outflows)
|
|
16
|
|
|
(27
|
)
|
|
(15
|
)
|
|
(9
|
)
|
|
(8
|
)
|
—
|
|
(1
|
)
|
—
|
|
—
|
|
|
(14
|
)
|
|
27
|
|
|
14
|
|
|
10
|
|
|
12
|
|
|
||||||||||||
Net market impact / Other
|
|
32
|
|
|
(29
|
)
|
|
(35
|
)
|
|
24
|
|
|
41
|
|
|
71
|
|
|
80
|
|
|
(11
|
)
|
|
41
|
|
|
1
|
|
|
17
|
|
|
47
|
|
|
||||||||||||||
Net currency impact
|
|
(35
|
)
|
|
39
|
|
|
(25
|
)
|
|
(15
|
)
|
|
(19
|
)
|
|
(47
|
)
|
|
(29
|
)
|
|
(42
|
)
|
|
11
|
|
|
29
|
|
|
26
|
|
|
10
|
|
|
||||||||||||||
Acquisitions
|
|
18
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||
Ending balance of AUM
|
|
$
|
1,717
|
|
|
$
|
1,700
|
|
|
$
|
1,625
|
|
|
$
|
1,625
|
|
|
$
|
1,639
|
|
|
$
|
1,664
|
|
|
$
|
1,715
|
|
|
$
|
1,648
|
|
|
$
|
1,727
|
|
|
$
|
1,771
|
|
|
$
|
1,824
|
|
|
$
|
1,893
|
|
(d)
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||
(a) Excludes securities lending cash management assets and assets managed in the Investment Services business. In the third quarter of 2015, prior period AUM was restated to reflect the reclassification of Meriten from the Investment Management business to the Other segment.
|
|||||||||||||||||||||||||||||||||||||||||||||||||||
(b) In the first quarter of 2017, the AUM in our Wealth Management business and our multi-class funds has been reclassified to multi-asset and alternative investments. This reclassification does not change total AUM. All prior periods have been restated.
|
|||||||||||||||||||||||||||||||||||||||||||||||||||
(c) Includes currency overlay assets under management.
|
|||||||||||||||||||||||||||||||||||||||||||||||||||
(d) Preliminary.
|
9
|
|
|
2015
|
|
2016
|
|
2017
|
|
||||||||||||||||||||||||||||||||||||||||||
(dollar amounts in millions unless otherwise noted)
|
|
1st Qtr
|
|
2nd Qtr
|
|
3rd Qtr
|
|
4th Qtr
|
|
1st Qtr
|
|
2nd Qtr
|
|
3rd Qtr
|
|
4th Qtr
|
|
1st Qtr
|
|
2nd Qtr
|
|
3rd Qtr
|
|
4th Qtr
|
|
||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Investment management fees:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Mutual funds
|
|
$
|
301
|
|
|
$
|
312
|
|
|
$
|
301
|
|
|
$
|
294
|
|
|
$
|
300
|
|
|
$
|
304
|
|
|
$
|
309
|
|
|
$
|
297
|
|
|
$
|
299
|
|
|
$
|
314
|
|
|
$
|
332
|
|
|
$
|
341
|
|
|
Institutional clients
|
|
365
|
|
|
363
|
|
|
347
|
|
|
350
|
|
|
334
|
|
|
344
|
|
|
362
|
|
|
340
|
|
|
348
|
|
|
362
|
|
|
367
|
|
|
378
|
|
|
||||||||||||
Wealth management
|
|
159
|
|
|
160
|
|
|
156
|
|
|
155
|
|
|
152
|
|
|
160
|
|
|
166
|
|
|
164
|
|
|
167
|
|
|
169
|
|
|
172
|
|
|
179
|
|
|
||||||||||||
Total investment management fees
(a)
|
|
825
|
|
|
835
|
|
|
804
|
|
|
799
|
|
|
786
|
|
|
808
|
|
|
837
|
|
|
801
|
|
|
814
|
|
|
845
|
|
|
871
|
|
|
898
|
|
|
||||||||||||
Performance fees
|
|
15
|
|
|
20
|
|
|
7
|
|
|
55
|
|
|
11
|
|
|
9
|
|
|
8
|
|
|
32
|
|
|
12
|
|
|
17
|
|
|
15
|
|
|
50
|
|
|
||||||||||||
Investment management and performance fees
|
|
840
|
|
|
855
|
|
|
811
|
|
|
854
|
|
|
797
|
|
|
817
|
|
|
845
|
|
|
833
|
|
|
826
|
|
|
862
|
|
|
886
|
|
|
948
|
|
|
||||||||||||
Distribution and servicing
|
|
38
|
|
|
38
|
|
|
37
|
|
|
39
|
|
|
46
|
|
|
49
|
|
|
49
|
|
|
48
|
|
|
52
|
|
|
53
|
|
|
51
|
|
|
51
|
|
|
||||||||||||
Other
(a)
|
|
41
|
|
|
17
|
|
|
(5
|
)
|
|
22
|
|
|
(31
|
)
|
|
(10
|
)
|
|
(18
|
)
|
|
(1
|
)
|
|
(1
|
)
|
|
(16
|
)
|
|
(19
|
)
|
|
(25
|
)
|
|
||||||||||||
Total fee and other revenue
(a)
|
|
919
|
|
|
910
|
|
|
843
|
|
|
915
|
|
|
812
|
|
|
856
|
|
|
876
|
|
|
880
|
|
|
877
|
|
|
899
|
|
|
918
|
|
|
974
|
|
|
||||||||||||
Net interest revenue
|
|
75
|
|
|
77
|
|
|
83
|
|
|
84
|
|
|
83
|
|
|
82
|
|
|
82
|
|
|
80
|
|
|
86
|
|
|
87
|
|
|
82
|
|
|
74
|
|
|
||||||||||||
Total revenue
|
|
994
|
|
|
987
|
|
|
926
|
|
|
999
|
|
|
895
|
|
|
938
|
|
|
958
|
|
|
960
|
|
|
963
|
|
|
986
|
|
|
1,000
|
|
|
1,048
|
|
|
||||||||||||
Provision for credit losses
|
|
(1
|
)
|
|
3
|
|
|
1
|
|
|
(4
|
)
|
|
(1
|
)
|
|
1
|
|
|
—
|
|
|
6
|
|
|
3
|
|
|
—
|
|
|
(2
|
)
|
|
1
|
|
|
||||||||||||
Noninterest expense (ex. amortization of intangible assets)
|
|
708
|
|
|
700
|
|
|
665
|
|
|
689
|
|
|
660
|
|
|
684
|
|
|
680
|
|
|
672
|
|
|
668
|
|
|
683
|
|
|
687
|
|
|
756
|
|
|
||||||||||||
Amortization of intangible assets
|
|
24
|
|
|
25
|
|
|
24
|
|
|
24
|
|
|
19
|
|
|
19
|
|
|
22
|
|
|
22
|
|
|
15
|
|
|
15
|
|
|
15
|
|
|
15
|
|
|
||||||||||||
Total noninterest expense
|
|
732
|
|
|
725
|
|
|
689
|
|
|
713
|
|
|
679
|
|
|
703
|
|
|
702
|
|
|
694
|
|
|
683
|
|
|
698
|
|
|
702
|
|
|
771
|
|
|
||||||||||||
Income before taxes
|
|
$
|
263
|
|
|
$
|
259
|
|
|
$
|
236
|
|
|
$
|
290
|
|
|
$
|
217
|
|
|
$
|
234
|
|
|
$
|
256
|
|
|
$
|
260
|
|
|
$
|
277
|
|
|
$
|
288
|
|
|
$
|
300
|
|
|
$
|
276
|
|
|
Income before taxes (ex. intangible amortization) - Non-GAAP
|
|
$
|
287
|
|
|
$
|
284
|
|
|
$
|
260
|
|
|
$
|
314
|
|
|
$
|
236
|
|
|
$
|
253
|
|
|
$
|
278
|
|
|
$
|
282
|
|
|
$
|
292
|
|
|
$
|
303
|
|
|
$
|
315
|
|
|
$
|
291
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Average assets
|
|
$
|
31,361
|
|
|
$
|
30,414
|
|
|
$
|
30,960
|
|
|
$
|
30,982
|
|
|
$
|
29,971
|
|
|
$
|
30,229
|
|
|
$
|
30,392
|
|
|
$
|
30,532
|
|
|
$
|
31,067
|
|
|
$
|
31,355
|
|
|
$
|
31,689
|
|
|
$
|
31,681
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Assets under management at period end (in billions) (b)
|
|
$
|
1,717
|
|
|
$
|
1,700
|
|
|
$
|
1,625
|
|
|
$
|
1,625
|
|
|
$
|
1,639
|
|
|
$
|
1,664
|
|
|
$
|
1,715
|
|
|
$
|
1,648
|
|
|
$
|
1,727
|
|
|
$
|
1,771
|
|
|
$
|
1,824
|
|
|
$
|
1,893
|
|
(c)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Pre-tax operating margin
|
|
26
|
%
|
|
26
|
%
|
|
25
|
%
|
|
29
|
%
|
|
24
|
%
|
|
25
|
%
|
|
27
|
%
|
|
27
|
%
|
|
29
|
%
|
|
29
|
%
|
|
30
|
%
|
|
26
|
%
|
|
||||||||||||
Adjusted pre-tax operating margin
- Non-GAAP
(d)
|
|
32
|
%
|
|
32
|
%
|
|
31
|
%
|
|
34
|
%
|
|
30
|
%
|
|
30
|
%
|
|
33
|
%
|
|
33
|
%
|
|
34
|
%
|
|
34
|
%
|
|
35
|
%
|
|
31
|
%
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
(a) Total fee and other revenue includes the impact of the consolidated investment management funds, net of noncontrolling interests. Additionally, other revenue includes asset servicing, treasury services, foreign exchange and other trading revenue and investment and other income.
|
|||||||||||||||||||||||||||||||||||||||||||||||||
(b) Excludes securities lending cash management assets and assets managed in the Investment Services business. In the third quarter of 2015, prior period AUM was restated to reflect the reclassification of Meriten from the Investment Management business to the Other segment.
|
|||||||||||||||||||||||||||||||||||||||||||||||||
(c) Preliminary.
|
|||||||||||||||||||||||||||||||||||||||||||||||||
(d) Excludes amortization of intangible assets, provision for credit losses, and distribution and servicing expense. See "Supplemental information - Explanation of GAAP and Non-GAAP financial measures" beginning on page 23 of the Quarterly Earnings Release for the reconciliation of this Non-GAAP measure. Also, see "Appendix - GAAP to Non-GAAP Reconciliations" beginning on page 17 for the reconciliation of Non-GAAP measures.
|
10
|
|
|
2015
|
|
2016
|
|
2017
|
|
||||||||||||||||||||||||||||||||||||||||||
(dollar amounts in millions unless otherwise noted)
|
|
1st Qtr
|
|
2nd Qtr
|
|
3rd Qtr
|
|
4th Qtr
|
|
1st Qtr
|
|
2nd Qtr
|
|
3rd Qtr
|
|
4th Qtr
|
|
1st Qtr
|
|
2nd Qtr
|
|
3rd Qtr
|
|
4th Qtr
|
|
||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Investment services fees
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Asset servicing - ex. securities lending
|
|
$
|
979
|
|
|
$
|
995
|
|
|
$
|
1,001
|
|
|
$
|
970
|
|
|
$
|
974
|
|
|
$
|
1,001
|
|
|
$
|
997
|
|
|
$
|
999
|
|
|
$
|
998
|
|
|
$
|
1,019
|
|
|
$
|
1,040
|
|
|
$
|
1,061
|
|
|
Securities lending revenue
|
|
38
|
|
|
43
|
|
|
33
|
|
|
39
|
|
|
42
|
|
|
42
|
|
|
42
|
|
|
44
|
|
|
40
|
|
|
42
|
|
|
41
|
|
|
45
|
|
|
||||||||||||
Clearing services
|
|
342
|
|
|
346
|
|
|
345
|
|
|
337
|
|
|
348
|
|
|
350
|
|
|
347
|
|
|
354
|
|
|
375
|
|
|
393
|
|
|
381
|
|
|
400
|
|
|
||||||||||||
Issuer services
|
|
231
|
|
|
234
|
|
|
312
|
|
|
199
|
|
|
244
|
|
|
233
|
|
|
336
|
|
|
211
|
|
|
250
|
|
|
241
|
|
|
288
|
|
|
196
|
|
|
||||||||||||
Treasury services
|
|
135
|
|
|
141
|
|
|
135
|
|
|
135
|
|
|
129
|
|
|
137
|
|
|
136
|
|
|
139
|
|
|
139
|
|
|
139
|
|
|
141
|
|
|
136
|
|
|
||||||||||||
Total investment services fees
|
|
1,725
|
|
|
1,759
|
|
|
1,826
|
|
|
1,680
|
|
|
1,737
|
|
|
1,763
|
|
|
1,858
|
|
|
1,747
|
|
|
1,802
|
|
|
1,834
|
|
|
1,891
|
|
|
1,838
|
|
|
||||||||||||
Foreign exchange and other trading revenue
|
|
212
|
|
|
181
|
|
|
179
|
|
|
150
|
|
|
168
|
|
|
161
|
|
|
177
|
|
|
157
|
|
|
153
|
|
|
145
|
|
|
154
|
|
|
168
|
|
|
||||||||||||
Other
(a)
|
|
92
|
|
|
117
|
|
|
129
|
|
|
127
|
|
|
125
|
|
|
130
|
|
|
148
|
|
|
128
|
|
|
129
|
|
|
136
|
|
|
142
|
|
|
135
|
|
|
||||||||||||
Total fee and other revenue
|
|
2,029
|
|
|
2,057
|
|
|
2,134
|
|
|
1,957
|
|
|
2,030
|
|
|
2,054
|
|
|
2,183
|
|
|
2,032
|
|
|
2,084
|
|
|
2,115
|
|
|
2,187
|
|
|
2,141
|
|
|
||||||||||||
Net interest revenue
|
|
629
|
|
|
667
|
|
|
662
|
|
|
664
|
|
|
679
|
|
|
690
|
|
|
715
|
|
|
713
|
|
|
707
|
|
|
761
|
|
|
777
|
|
|
813
|
|
|
||||||||||||
Total revenue
|
|
2,658
|
|
|
2,724
|
|
|
2,796
|
|
|
2,621
|
|
|
2,709
|
|
|
2,744
|
|
|
2,898
|
|
|
2,745
|
|
|
2,791
|
|
|
2,876
|
|
|
2,964
|
|
|
2,954
|
|
|
||||||||||||
Provision for credit losses
|
|
7
|
|
|
6
|
|
|
7
|
|
|
8
|
|
|
14
|
|
|
(7
|
)
|
|
1
|
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
(2
|
)
|
|
(2
|
)
|
|
||||||||||||
Noninterest expense (ex. intangible amortization)
|
|
1,822
|
|
|
1,874
|
|
|
1,853
|
|
|
1,791
|
|
|
1,770
|
|
|
1,819
|
|
|
1,812
|
|
|
1,786
|
|
|
1,812
|
|
|
1,889
|
|
|
1,837
|
|
|
2,060
|
|
|
||||||||||||
Amortization of intangible assets
|
|
41
|
|
|
40
|
|
|
41
|
|
|
40
|
|
|
38
|
|
|
40
|
|
|
39
|
|
|
38
|
|
|
37
|
|
|
38
|
|
|
37
|
|
|
37
|
|
|
||||||||||||
Total noninterest expense
|
|
1,863
|
|
|
1,914
|
|
|
1,894
|
|
|
1,831
|
|
|
1,808
|
|
|
1,859
|
|
|
1,851
|
|
|
1,824
|
|
|
1,849
|
|
|
1,927
|
|
|
1,874
|
|
|
2,097
|
|
|
||||||||||||
Income before taxes
|
|
$
|
788
|
|
|
$
|
804
|
|
|
$
|
895
|
|
|
$
|
782
|
|
|
$
|
887
|
|
|
$
|
892
|
|
|
$
|
1,046
|
|
|
$
|
921
|
|
|
$
|
942
|
|
|
$
|
952
|
|
|
$
|
1,092
|
|
|
$
|
859
|
|
|
Income before taxes (ex. amortization of intangible assets) - Non-GAAP
|
|
$
|
829
|
|
|
$
|
844
|
|
|
$
|
936
|
|
|
$
|
822
|
|
|
$
|
925
|
|
|
$
|
932
|
|
|
$
|
1,085
|
|
|
$
|
959
|
|
|
$
|
979
|
|
|
$
|
990
|
|
|
$
|
1,129
|
|
|
$
|
896
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Average loans
|
|
$
|
45,071
|
|
|
$
|
45,822
|
|
|
$
|
46,222
|
|
|
$
|
45,844
|
|
|
$
|
45,004
|
|
|
$
|
43,786
|
|
|
$
|
44,329
|
|
|
$
|
45,832
|
|
|
$
|
42,818
|
|
|
$
|
40,931
|
|
|
$
|
38,038
|
|
|
$
|
38,845
|
|
|
Average assets
|
|
$
|
287,321
|
|
|
$
|
292,264
|
|
|
$
|
285,195
|
|
|
$
|
281,766
|
|
|
$
|
273,289
|
|
|
$
|
277,225
|
|
|
$
|
275,714
|
|
|
$
|
269,036
|
|
|
$
|
251,027
|
|
|
$
|
254,724
|
|
|
$
|
252,461
|
|
|
$
|
260,494
|
|
|
Average deposits
|
|
$
|
235,524
|
|
|
$
|
238,404
|
|
|
$
|
232,250
|
|
|
$
|
229,241
|
|
|
$
|
215,707
|
|
|
$
|
221,998
|
|
|
$
|
220,316
|
|
|
$
|
213,531
|
|
|
$
|
197,690
|
|
|
$
|
200,417
|
|
|
$
|
198,299
|
|
|
$
|
204,680
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Pre-tax operating margin
|
|
30
|
%
|
|
30
|
%
|
|
32
|
%
|
|
30
|
%
|
|
33
|
%
|
|
33
|
%
|
|
36
|
%
|
|
34
|
%
|
|
34
|
%
|
|
33
|
%
|
|
37
|
%
|
|
29
|
%
|
|
||||||||||||
Adjusted pre-tax operating margin (ex. provision for credit losses and intangible amortization) - Non-GAAP
|
|
31
|
%
|
|
31
|
%
|
|
34
|
%
|
|
32
|
%
|
|
35
|
%
|
|
34
|
%
|
|
37
|
%
|
|
35
|
%
|
|
35
|
%
|
|
34
|
%
|
|
38
|
%
|
|
30
|
%
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Investment services fees as a percentage of noninterest expense (ex. intangible amortization)
|
|
95
|
%
|
|
94
|
%
|
|
99
|
%
|
|
94
|
%
|
|
98
|
%
|
|
97
|
%
|
|
103
|
%
|
|
98
|
%
|
|
99
|
%
|
|
97
|
%
|
|
103
|
%
|
|
89
|
%
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Assets under custody and/or administration at period end
(in trillions) (b)
|
|
$
|
28.5
|
|
|
$
|
28.6
|
|
|
$
|
28.5
|
|
|
$
|
28.9
|
|
|
$
|
29.1
|
|
|
$
|
29.5
|
|
|
$
|
30.5
|
|
|
$
|
29.9
|
|
|
$
|
30.6
|
|
|
$
|
31.1
|
|
|
$
|
32.2
|
|
|
$
|
33.3
|
|
(c)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Market value of securities on loan at period end
(in billions) (d)
|
|
$
|
291
|
|
|
$
|
283
|
|
|
$
|
288
|
|
|
$
|
277
|
|
|
$
|
300
|
|
|
$
|
278
|
|
|
$
|
288
|
|
|
$
|
296
|
|
|
$
|
314
|
|
|
$
|
336
|
|
|
$
|
382
|
|
|
$
|
408
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
(a) Other revenue includes investment management fees, financing-related fees, distribution and servicing revenue and investment and other income.
|
|
||||||||||||||||||||||||||||||||||||||||||||||||
(b) Includes the AUC/A of CIBC Mellon Global Securities Services Company ("CIBC Mellon"), a joint venture with the Canadian Imperial Bank of Commerce, of $1.1 trillion at March 31, 2015 and June 30, 2015, $1.0 trillion at Sept. 30, 2015 and Dec. 31, 2015, $1.1 trillion at March 31, 2016 and June 30, 2016, $1.2 trillion at Sept. 30, 2016, Dec. 31, 2016, March 31, 2017 and June 30, 2017, and $1.3 trillion at Sept. 30, 2017 and Dec. 31, 2017.
|
|
||||||||||||||||||||||||||||||||||||||||||||||||
(c) Preliminary.
|
|
||||||||||||||||||||||||||||||||||||||||||||||||
(d) Represents the total amount of securities on loan in our agency securities lending program managed by the Investment Services business. Excludes securities for which BNY Mellon acts as agent on behalf of CIBC Mellon clients, which totaled $69 billion at March 31, 2015, $68 billion at June 30, 2015, $61 billion at Sept. 30, 2015, $55 billion at Dec. 31, 2015, $56 billion at March 31, 2016 and June 30, 2016, $64 billion at Sept. 30, 2016, $63 billion at Dec. 31, 2016, $65 billion at March 31, 2017, $66 billion at June 30, 2017, $68 billion at Sept. 30, 2017 and $71 billion at Dec. 31, 2017.
|
|
11
|
|
|
2015
|
|
2016
|
|
2017
|
||||||||||||||||||||||||||||||||||||||||||
(dollar amounts in millions)
|
|
1st Qtr
|
|
2nd Qtr
|
|
3rd Qtr
|
|
4th Qtr
|
|
1st Qtr
|
|
2nd Qtr
|
|
3rd Qtr
|
|
4th Qtr
|
|
1st Qtr
|
|
2nd Qtr
|
|
3rd Qtr
|
|
4th Qtr
|
||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Fee and other revenue
|
|
$
|
85
|
|
|
$
|
103
|
|
|
$
|
59
|
|
|
$
|
89
|
|
|
$
|
129
|
|
|
$
|
95
|
|
|
$
|
100
|
|
|
$
|
42
|
|
|
$
|
72
|
|
|
$
|
113
|
|
|
$
|
69
|
|
|
$
|
(247
|
)
|
Net interest revenue (expense)
|
|
24
|
|
|
35
|
|
|
14
|
|
|
12
|
|
|
4
|
|
|
(5
|
)
|
|
(23
|
)
|
|
38
|
|
|
(1
|
)
|
|
(22
|
)
|
|
(20
|
)
|
|
(36
|
)
|
||||||||||||
Total revenue
|
|
109
|
|
|
138
|
|
|
73
|
|
|
101
|
|
|
133
|
|
|
90
|
|
|
77
|
|
|
80
|
|
|
71
|
|
|
91
|
|
|
49
|
|
|
(283
|
)
|
||||||||||||
Provision for credit losses
|
|
(4
|
)
|
|
(15
|
)
|
|
(7
|
)
|
|
159
|
|
|
(3
|
)
|
|
(3
|
)
|
|
(20
|
)
|
|
1
|
|
|
(8
|
)
|
|
(4
|
)
|
|
(2
|
)
|
|
(5
|
)
|
||||||||||||
Noninterest expense (ex. amortization of intangible assets, M&I and restructuring (recoveries) charges)
|
|
108
|
|
|
79
|
|
|
97
|
|
|
150
|
|
|
141
|
|
|
53
|
|
|
88
|
|
|
108
|
|
|
106
|
|
|
28
|
|
|
77
|
|
|
134
|
|
||||||||||||
Amortization of intangible assets
|
|
1
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||||||
M&I and restructuring (recoveries) charges
|
|
(4
|
)
|
|
8
|
|
|
(2
|
)
|
|
(4
|
)
|
|
(1
|
)
|
|
3
|
|
|
—
|
|
|
2
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
1
|
|
||||||||||||
Total noninterest expense
|
|
105
|
|
|
87
|
|
|
96
|
|
|
146
|
|
|
140
|
|
|
56
|
|
|
88
|
|
|
110
|
|
|
107
|
|
|
28
|
|
|
77
|
|
|
135
|
|
||||||||||||
Income (loss) before taxes
|
|
$
|
8
|
|
|
$
|
66
|
|
|
$
|
(16
|
)
|
|
$
|
(204
|
)
|
|
$
|
(4
|
)
|
|
$
|
37
|
|
|
$
|
9
|
|
|
$
|
(31
|
)
|
|
$
|
(28
|
)
|
|
$
|
67
|
|
|
$
|
(26
|
)
|
|
$
|
(413
|
)
|
Income (loss) before taxes (ex. amortization of intangible assets, M&I and restructuring (recoveries) charges) - Non-GAAP
|
|
$
|
5
|
|
|
$
|
74
|
|
|
$
|
(17
|
)
|
|
$
|
(208
|
)
|
|
$
|
(5
|
)
|
|
$
|
40
|
|
|
$
|
9
|
|
|
$
|
(29
|
)
|
|
$
|
(27
|
)
|
|
$
|
67
|
|
|
$
|
(26
|
)
|
|
$
|
(412
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Average loans and leases
|
|
$
|
1,230
|
|
|
$
|
2,956
|
|
|
$
|
2,656
|
|
|
$
|
2,673
|
|
|
$
|
1,917
|
|
|
$
|
1,703
|
|
|
$
|
1,941
|
|
|
$
|
2,142
|
|
|
$
|
1,341
|
|
|
$
|
1,302
|
|
|
$
|
1,182
|
|
|
$
|
1,114
|
|
Average assets
|
|
$
|
49,729
|
|
|
$
|
55,601
|
|
|
$
|
57,298
|
|
|
$
|
55,842
|
|
|
$
|
61,294
|
|
|
$
|
66,766
|
|
|
$
|
45,124
|
|
|
$
|
44,577
|
|
|
$
|
54,106
|
|
|
$
|
56,436
|
|
|
$
|
61,559
|
|
|
$
|
58,611
|
|
12
|
|
|
Investment Management
|
|
Investment Services
|
|
Other
|
|
Consolidated Results
|
|
||||||||||||||||||||||||||||||||||||||||
(dollar amounts in millions unless otherwise noted)
|
|
2017
|
|
2016
|
|
2015
|
|
2017
|
|
2016
|
|
2015
|
|
2017
|
|
2016
|
|
2015
|
|
2017
|
|
2016
|
|
2015
|
|
||||||||||||||||||||||||
Investment services fees
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Asset servicing
|
|
$
|
96
|
|
|
$
|
102
|
|
|
$
|
89
|
|
|
$
|
4,286
|
|
|
$
|
4,141
|
|
|
$
|
4,098
|
|
|
$
|
1
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
4,383
|
|
|
$
|
4,244
|
|
|
$
|
4,187
|
|
|
Clearing services
|
|
—
|
|
|
—
|
|
|
—
|
|
|
975
|
|
|
1,399
|
|
|
1,370
|
|
|
2
|
|
|
5
|
|
|
5
|
|
|
977
|
|
|
1,404
|
|
|
1,375
|
|
|
||||||||||||
Issuer services
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,549
|
|
|
1,024
|
|
|
976
|
|
|
4
|
|
|
2
|
|
|
2
|
|
|
1,553
|
|
|
1,026
|
|
|
978
|
|
|
||||||||||||
Treasury services
|
|
1
|
|
|
6
|
|
|
9
|
|
|
555
|
|
|
541
|
|
|
546
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
557
|
|
|
547
|
|
|
555
|
|
|
||||||||||||
Total investment services fees
|
|
97
|
|
|
108
|
|
|
98
|
|
|
7,365
|
|
|
7,105
|
|
|
6,990
|
|
|
8
|
|
|
8
|
|
|
7
|
|
|
7,470
|
|
|
7,221
|
|
|
7,095
|
|
|
||||||||||||
Investment management fees
|
|
3,428
|
|
|
3,232
|
|
|
3,263
|
|
|
67
|
|
|
69
|
|
|
70
|
|
|
—
|
|
|
—
|
|
|
22
|
|
|
3,495
|
|
|
3,301
|
|
|
3,355
|
|
|
||||||||||||
Performance fees
|
|
94
|
|
|
60
|
|
|
97
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
94
|
|
|
60
|
|
|
98
|
|
|
||||||||||||
Foreign exchange and other trading revenue
|
|
(35
|
)
|
|
(81
|
)
|
|
(13
|
)
|
|
620
|
|
|
663
|
|
|
722
|
|
|
83
|
|
|
119
|
|
|
59
|
|
|
668
|
|
|
701
|
|
|
768
|
|
|
||||||||||||
Distribution and servicing
|
|
207
|
|
|
192
|
|
|
152
|
|
|
(47
|
)
|
|
(26
|
)
|
|
10
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
160
|
|
|
166
|
|
|
162
|
|
|
||||||||||||
Financing-related fees
|
|
(3
|
)
|
|
(3
|
)
|
|
(1
|
)
|
|
222
|
|
|
226
|
|
|
222
|
|
|
(3
|
)
|
|
(4
|
)
|
|
(1
|
)
|
|
216
|
|
|
219
|
|
|
220
|
|
|
||||||||||||
Investment and other income
|
|
(120
|
)
|
|
(84
|
)
|
|
(10
|
)
|
|
300
|
|
|
262
|
|
|
163
|
|
|
(84
|
)
|
|
168
|
|
|
166
|
|
|
96
|
|
|
346
|
|
|
319
|
|
|
||||||||||||
Total fee revenue
|
|
3,668
|
|
|
3,424
|
|
|
3,586
|
|
|
8,527
|
|
|
8,299
|
|
|
8,177
|
|
|
4
|
|
(a)
|
291
|
|
(a)
|
254
|
|
(a)
|
12,199
|
|
(a)
|
12,014
|
|
(a)
|
12,017
|
|
(a)
|
||||||||||||
Net securities gains (losses)
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|
75
|
|
|
82
|
|
|
3
|
|
|
75
|
|
|
83
|
|
|
||||||||||||
Total fee and other revenue
|
|
3,668
|
|
|
3,424
|
|
|
3,587
|
|
|
8,527
|
|
|
8,299
|
|
|
8,177
|
|
|
7
|
|
(a)
|
366
|
|
(a)
|
336
|
|
(a)
|
12,202
|
|
(a)
|
12,089
|
|
(a)
|
12,100
|
|
(a)
|
||||||||||||
Net interest revenue (expense)
|
|
329
|
|
|
327
|
|
|
319
|
|
|
3,058
|
|
|
2,797
|
|
|
2,622
|
|
|
(79
|
)
|
|
14
|
|
|
85
|
|
|
3,308
|
|
|
3,138
|
|
|
3,026
|
|
|
||||||||||||
Total revenue
|
|
3,997
|
|
|
3,751
|
|
|
3,906
|
|
|
11,585
|
|
|
11,096
|
|
|
10,799
|
|
|
(72
|
)
|
|
380
|
|
|
421
|
|
|
15,510
|
|
|
15,227
|
|
|
15,126
|
|
|
||||||||||||
Provision for credit losses
|
|
2
|
|
|
6
|
|
|
(1
|
)
|
|
(7
|
)
|
|
8
|
|
|
28
|
|
|
(19
|
)
|
|
(25
|
)
|
|
133
|
|
|
(24
|
)
|
|
(11
|
)
|
|
160
|
|
|
||||||||||||
Noninterest expense (ex. amortization of intangible assets)
|
|
2,794
|
|
|
2,696
|
|
|
2,762
|
|
|
7,598
|
|
|
7,187
|
|
|
7,340
|
|
|
347
|
|
|
394
|
|
|
432
|
|
|
10,739
|
|
|
10,277
|
|
|
10,534
|
|
|
||||||||||||
Amortization of intangible assets
|
|
60
|
|
|
82
|
|
|
97
|
|
|
149
|
|
|
155
|
|
|
162
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
209
|
|
|
237
|
|
|
261
|
|
|
||||||||||||
Total noninterest expense
|
|
2,854
|
|
|
2,778
|
|
|
2,859
|
|
|
7,747
|
|
|
7,342
|
|
|
7,502
|
|
|
347
|
|
|
394
|
|
|
434
|
|
|
10,948
|
|
|
10,514
|
|
|
10,795
|
|
|
||||||||||||
Income (loss) before taxes and noncontrolling interest
|
|
$
|
1,141
|
|
|
$
|
967
|
|
|
$
|
1,048
|
|
|
$
|
3,845
|
|
|
$
|
3,746
|
|
|
$
|
3,269
|
|
|
$
|
(400
|
)
|
(a)
|
$
|
11
|
|
(a)
|
$
|
(146
|
)
|
(a)
|
$
|
4,586
|
|
(a)
|
$
|
4,724
|
|
(a)
|
$
|
4,171
|
|
(a)
|
Income (loss) before taxes (ex. amortization of intangible assets) - Non-GAAP
|
|
$
|
1,201
|
|
|
$
|
1,049
|
|
|
$
|
1,145
|
|
|
$
|
3,994
|
|
|
$
|
3,901
|
|
|
$
|
3,431
|
|
|
$
|
(400
|
)
|
(a)
|
$
|
11
|
|
(a)
|
$
|
(144
|
)
|
(a)
|
$
|
4,795
|
|
(a)
|
$
|
4,961
|
|
(a)
|
$
|
4,432
|
|
(a)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Average loans
|
|
$
|
16,565
|
|
|
$
|
15,015
|
|
|
$
|
12,545
|
|
|
$
|
40,142
|
|
|
$
|
44,740
|
|
|
$
|
45,743
|
|
|
$
|
1,232
|
|
|
$
|
1,926
|
|
|
$
|
2,384
|
|
|
$
|
57,939
|
|
|
$
|
61,681
|
|
|
$
|
60,672
|
|
|
Average assets
|
|
$
|
31,450
|
|
|
$
|
30,170
|
|
|
$
|
30,928
|
|
|
$
|
254,646
|
|
|
$
|
273,808
|
|
|
$
|
286,617
|
|
|
$
|
57,752
|
|
|
$
|
54,500
|
|
|
$
|
54,642
|
|
|
$
|
343,848
|
|
|
$
|
358,478
|
|
|
$
|
372,187
|
|
|
Average deposits
|
|
$
|
13,615
|
|
|
$
|
15,650
|
|
|
$
|
15,160
|
|
|
$
|
200,235
|
|
|
$
|
217,882
|
|
|
$
|
233,833
|
|
|
$
|
936
|
|
|
$
|
6,127
|
|
|
$
|
2,441
|
|
|
$
|
214,786
|
|
|
$
|
239,659
|
|
|
$
|
251,434
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Assets under management at period end
(in billions) (b)
|
|
$
|
1,893
|
|
|
$
|
1,648
|
|
|
$
|
1,625
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,893
|
|
|
$
|
1,648
|
|
|
$
|
1,625
|
|
|
Assets under custody and/or administration at period end
(in trillions) (c)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
33.3
|
|
|
$
|
29.9
|
|
|
$
|
28.9
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
33.3
|
|
|
$
|
29.9
|
|
|
$
|
28.9
|
|
|
Market value of securities on loan at period end
(in billions) (d)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
408
|
|
|
$
|
296
|
|
|
$
|
277
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
408
|
|
|
$
|
296
|
|
|
$
|
277
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Pre-tax operating margin
|
|
29
|
%
|
|
26
|
%
|
|
27
|
%
|
|
33
|
%
|
|
34
|
%
|
|
30
|
%
|
|
N/M
|
|
|
N/M
|
|
|
N/M
|
|
|
30
|
%
|
|
31
|
%
|
|
28
|
%
|
|
||||||||||||
Memo:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Securities lending revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
195
|
|
|
$
|
207
|
|
|
$
|
176
|
|
|
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
|
|||||||||||||||||||||||||||||||||||||||||||||||||
(a) Total fee and other revenue and income before taxes for the years 2015, 2016 and 2017 include income from consolidated investment management funds of $86 million, $26 million and $70 million, respectively, net of income attributable to noncontrolling interests of $64 million, $1 million and $24 million respectively. The net of these income statement line items of $18 million, $16 million and $37 million, respectively, are included above in fee and other revenue. The years 2015, 2016 and 2017 include losses attributable to noncontrolling interest of $4 million, $9 million and $9 million, respectively, related to other consolidated subsidiaries.
|
|||||||||||||||||||||||||||||||||||||||||||||||||
(b) Excludes securities lending cash management assets and assets managed in the Investment Services business. In the third quarter of 2015, prior period AUM was restated to reflect the reclassification of Meriten from the Investment Management business to the Other segment.
|
|||||||||||||||||||||||||||||||||||||||||||||||||
(c) Includes the AUC/A of CIBC Mellon Global Securities Services Company ("CIBC Mellon"), a joint venture with the Canadian Imperial Bank of Commerce, of $1.0 trillion at Dec. 31, 2015, $1.2 trillion at Dec. 31, 2016 and $1.3 trillion at Dec. 31, 2017.
|
|||||||||||||||||||||||||||||||||||||||||||||||||
(d) Represents the total amount of securities on loan in our agency securities lending program managed by the Investment Services business. Excludes securities for which BNY Mellon acts as agent on behalf of CIBC Mellon clients, which totaled $55 billion at Dec. 31, 2015, $63 billion at Dec. 31, 2016 and $71 billion at Dec. 31, 2017.
|
|||||||||||||||||||||||||||||||||||||||||||||||||
Note: See pages 10 through 12 for businesses results.
|
|||||||||||||||||||||||||||||||||||||||||||||||||
N/M - Not meaningful
|
13
|
|
|
2015
|
|
2016
|
|
2017
|
||||||||||||||||||||||||||||||||||||||||||
(dollar amounts in millions)
|
|
March 31
|
|
June 30
|
|
Sept. 30
|
|
Dec. 31
|
|
March 31
|
|
June 30
|
|
Sept. 30
|
|
Dec. 31
|
|
March 31
|
|
June 30
|
|
Sept. 30
|
|
Dec. 31
|
||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Nonperforming loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Other residential mortgages
|
|
$
|
111
|
|
|
$
|
110
|
|
|
$
|
103
|
|
|
$
|
102
|
|
|
$
|
99
|
|
|
$
|
97
|
|
|
$
|
93
|
|
|
$
|
91
|
|
|
$
|
88
|
|
|
$
|
84
|
|
|
$
|
80
|
|
|
$
|
78
|
|
Wealth management loans and mortgages
|
|
12
|
|
|
11
|
|
|
12
|
|
|
11
|
|
|
11
|
|
|
10
|
|
|
7
|
|
|
8
|
|
|
10
|
|
|
10
|
|
|
8
|
|
|
7
|
|
||||||||||||
Commercial real estate
|
|
1
|
|
|
1
|
|
|
1
|
|
|
2
|
|
|
2
|
|
|
2
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
||||||||||||
Lease financing
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|
4
|
|
|
4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||||||
Commercial
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||||||
Financial institutions
|
|
—
|
|
|
—
|
|
|
—
|
|
|
171
|
|
|
171
|
|
|
171
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
2
|
|
|
—
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Total nonperforming loans
|
|
124
|
|
|
122
|
|
|
116
|
|
|
286
|
|
|
288
|
|
|
284
|
|
|
105
|
|
|
103
|
|
|
98
|
|
|
96
|
|
|
90
|
|
|
86
|
|
||||||||||||
Other assets owned
|
|
4
|
|
|
5
|
|
|
7
|
|
|
6
|
|
|
4
|
|
|
5
|
|
|
4
|
|
|
4
|
|
|
9
|
|
|
4
|
|
|
4
|
|
|
4
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Total nonperforming assets
(a)
|
|
$
|
128
|
|
|
$
|
127
|
|
|
$
|
123
|
|
|
$
|
292
|
|
|
$
|
292
|
|
|
$
|
289
|
|
|
$
|
109
|
|
|
$
|
107
|
|
|
$
|
107
|
|
|
$
|
100
|
|
|
$
|
94
|
|
|
$
|
90
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Nonperforming assets ratio
|
|
0.21
|
%
|
|
0.20
|
%
|
|
0.20
|
%
|
|
0.46
|
%
|
|
0.48
|
%
|
|
0.45
|
%
|
|
0.17
|
%
|
|
0.17
|
%
|
|
0.18
|
%
|
|
0.16
|
%
|
|
0.16
|
%
|
|
0.15
|
%
|
||||||||||||
Nonperforming assets ratio excluding margin loans
|
|
0.30
|
|
|
0.30
|
|
|
0.28
|
|
|
0.67
|
|
|
0.69
|
|
|
0.63
|
|
|
0.23
|
|
|
0.23
|
|
|
0.24
|
|
|
0.21
|
|
|
0.21
|
|
|
0.15
|
|
||||||||||||
Allowance for loan losses/nonperforming loans
|
|
153.2
|
|
|
150.0
|
|
|
156.0
|
|
|
54.9
|
|
|
56.3
|
|
|
55.6
|
|
|
141.0
|
|
|
164.1
|
|
|
167.3
|
|
|
171.9
|
|
|
178.9
|
|
|
184.9
|
|
||||||||||||
Allowance for loan losses/nonperforming assets
|
|
148.4
|
|
|
144.1
|
|
|
147.2
|
|
|
53.8
|
|
|
55.5
|
|
|
54.7
|
|
|
135.8
|
|
|
157.9
|
|
|
153.3
|
|
|
165.0
|
|
|
171.3
|
|
|
176.7
|
|
||||||||||||
Total allowance for credit losses/nonperforming loans
|
|
228.2
|
|
|
227.9
|
|
|
241.4
|
|
|
96.2
|
|
|
99.7
|
|
|
98.6
|
|
|
261.0
|
|
|
272.8
|
|
|
281.6
|
|
|
281.3
|
|
|
294.4
|
|
|
303.5
|
|
||||||||||||
Total allowance for credit losses/nonperforming assets
|
|
221.1
|
|
|
218.9
|
|
|
227.6
|
|
|
94.2
|
|
|
98.3
|
|
|
96.9
|
|
|
251.4
|
|
|
262.6
|
|
|
257.9
|
|
|
270.0
|
|
|
281.9
|
|
|
290.0
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
(a) Loans of consolidated investment management funds are not part of BNY Mellon's loan portfolio. In 2Q15, BNY Mellon adopted the new accounting guidance included in ASU 2015-02, Consolidations. As a result, we deconsolidated substantially all of the loans of consolidated investment management funds retroactively to Jan.1, 2015.
|
14
|
|
|
2015
|
|
2016
|
|
2017
|
||||||||||||||||||||||||||||||||||||||||||
(dollar amounts in millions)
|
|
March 31
|
|
June 30
|
|
Sept. 30
|
|
Dec. 31
|
|
March 31
|
|
June 30
|
|
Sept. 30
|
|
Dec. 31
|
|
March 31
|
|
June 30
|
|
Sept. 30
|
|
Dec. 31
|
||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Allowance for credit losses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Allowance for credit losses
|
|
$
|
191
|
|
|
$
|
190
|
|
|
$
|
183
|
|
|
$
|
181
|
|
|
$
|
157
|
|
|
$
|
162
|
|
|
$
|
158
|
|
|
$
|
148
|
|
|
$
|
169
|
|
|
$
|
164
|
|
|
$
|
165
|
|
|
$
|
161
|
|
Allowance for lending-related commitments
|
|
89
|
|
|
93
|
|
|
95
|
|
|
99
|
|
|
118
|
|
|
125
|
|
|
122
|
|
|
126
|
|
|
112
|
|
|
112
|
|
|
105
|
|
|
104
|
|
||||||||||||
Allowance for credit losses - beginning of period
|
|
$
|
280
|
|
|
$
|
283
|
|
|
$
|
278
|
|
|
$
|
280
|
|
|
$
|
275
|
|
|
$
|
287
|
|
|
$
|
280
|
|
|
$
|
274
|
|
|
$
|
281
|
|
|
$
|
276
|
|
|
$
|
270
|
|
|
$
|
265
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Net (charge-offs) recoveries:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Charge-offs
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(170
|
)
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||||||
Recoveries
|
|
1
|
|
|
1
|
|
|
1
|
|
|
2
|
|
|
2
|
|
|
2
|
|
|
14
|
|
|
1
|
|
|
1
|
|
|
1
|
|
|
1
|
|
|
2
|
|
||||||||||||
Total net (charge-offs) recoveries
|
|
1
|
|
|
1
|
|
|
1
|
|
|
(168
|
)
|
|
2
|
|
|
2
|
|
|
13
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
|
2
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Provision for credit losses
|
|
2
|
|
|
(6
|
)
|
|
1
|
|
|
163
|
|
|
10
|
|
|
(9
|
)
|
|
(19
|
)
|
|
7
|
|
|
(5
|
)
|
|
(7
|
)
|
|
(6
|
)
|
|
(6
|
)
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Allowance for credit losses - end of period
|
|
$
|
283
|
|
|
$
|
278
|
|
|
$
|
280
|
|
|
$
|
275
|
|
|
$
|
287
|
|
|
$
|
280
|
|
|
$
|
274
|
|
|
$
|
281
|
|
|
$
|
276
|
|
|
$
|
270
|
|
|
$
|
265
|
|
|
$
|
261
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Allowance for loan losses
|
|
$
|
190
|
|
|
$
|
183
|
|
|
$
|
181
|
|
|
$
|
157
|
|
|
$
|
162
|
|
|
$
|
158
|
|
|
$
|
148
|
|
|
$
|
169
|
|
|
$
|
164
|
|
|
$
|
165
|
|
|
$
|
161
|
|
|
$
|
159
|
|
Allowance for lending-related commitments
|
|
93
|
|
|
95
|
|
|
99
|
|
|
118
|
|
|
125
|
|
|
122
|
|
|
126
|
|
|
112
|
|
|
112
|
|
|
105
|
|
|
104
|
|
|
102
|
|
||||||||||||
Allowance for credit losses - end of period
|
|
$
|
283
|
|
|
$
|
278
|
|
|
$
|
280
|
|
|
$
|
275
|
|
|
$
|
287
|
|
|
$
|
280
|
|
|
$
|
274
|
|
|
$
|
281
|
|
|
$
|
276
|
|
|
$
|
270
|
|
|
$
|
265
|
|
|
$
|
261
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Allowance for loan losses as a percentage of total loans
|
|
0.31
|
%
|
|
0.29
|
%
|
|
0.29
|
%
|
|
0.25
|
%
|
|
0.26
|
%
|
|
0.25
|
%
|
|
0.22
|
%
|
|
0.26
|
%
|
|
0.27
|
%
|
|
0.27
|
%
|
|
0.27
|
%
|
|
0.26
|
%
|
15
|
Notes:
|
The following transactions/changes have impacted the reporting of our results:
|
|
In the first quarter of 2016, results of credit-related activities were reclassified from the Other segment to the Investment Services segment. Also, concurrent with this reclassification, the provision for credit losses associated with the respective credit portfolios is now reflected in each business segment. All prior periods have been restated.
|
|
Beginning in the first quarter of 2016, we revised the net interest revenue for our business to reflect adjustments to our transfer pricing methodology to better reflect the value of certain deposits. This change did not impact the consolidated results.
|
|
Beginning in the first quarter of 2016, we refined the expense allocation process for indirect expenses to simplify the expenses recorded in the Other segment to include only expenses not directly attributable to the Investment Management and Investment Services operations. This change did not impact the consolidated results.
|
|
In the third quarter of 2015, results of Meriten were reclassified from the Investment Management business to the Other segment. Meriten Investment Management was sold in July 2015.
|
|
The first quarter of 2015 was restated to reflect the retrospective application of adopting new accounting guidance related to Consolidations (ASU 2015-02).
|
|
Certain immaterial reclassifications/revisions have been made to prior periods to place them on a basis comparable with the current period's presentation.
|
|
In businesses where average deposits are greater than average loans, average assets include an allocation of investment securities equal to the difference.
|
|
Quarterly return on common and tangible common equity ratios are annualized.
|
|
Non-GAAP Measures:
|
Certain Non-GAAP measures are included in this document. These measures are used by management to monitor financial performance, both on a company-wide and on a business basis. These Non-GAAP measures relate to certain revenue/expense categories, impairment charge(recovery) related to Sentinel, percentages and ratios as described in footnotes. For further information, see "Supplemental information -- Explanation of GAAP and Non-GAAP Financial Measures" in the Quarterly Earnings Release. Also, see "Appendix - GAAP to Non-GAAP Reconciliations" beginning on page 17 for the reconciliation of Non-GAAP measures. Summations may not equal due to rounding. As a result of our rounding convention and reclassifications noted above, differences may exist between the business trends data versus business data in the Form 10-Qs or other reports filed with the SEC.
|
16
|
|
|
|
Appendix - GAAP to Non-GAAP Reconciliations
|
|
|
|
17
|
|
THE BANK OF NEW YORK MELLON CORPORATION
|
|
SUPPLEMENTAL INFORMATION – EXPLANATION OF GAAP AND NON-GAAP FINANCIAL MEASURES
|
|
|
|
BNY Mellon has included in these Quarterly Financial Trends certain Non-GAAP financial measures based on tangible common shareholders’ equity. The tangible common shareholders’ equity ratio, which excludes goodwill and intangible assets, net of deferred tax liabilities, includes changes in investment securities valuations which are reflected in total shareholders’ equity. BNY Mellon believes that the return on tangible common equity measure, which excludes goodwill and intangible assets net of deferred tax liabilities, is a useful additional measure for investors because it presents a measure of those assets that can generate income.
|
|
|
|
BNY Mellon has presented revenue measures, which exclude the effect of noncontrolling interests related to consolidated investment management funds, and expense measures, which exclude M&I, litigation and restructuring charges and amortization of intangible assets. Return on tangible common equity and operating margin measures, which exclude some or all of these items, as well as the impairment charge(recovery) related to Sentinel, are also presented. Operating margin measures may also exclude the provision for credit losses and distribution and servicing expense. BNY Mellon believes that these measures are useful to investors because they permit a focus on period-to-period comparisons, which relate to the ability of BNY Mellon to enhance revenues and limit expenses in circumstances where such matters are within BNY Mellon’s control. M&I expenses primarily relate to acquisitions and generally continue for approximately three years after the transaction. Litigation charges represent accruals for loss contingencies that are both probable and reasonably estimable, but exclude standard business-related legal fees. Restructuring charges relate to our streamlining actions and Operational Excellence Initiatives. Excluding these charges mentioned above permits investors to view expenses on a basis consistent with how management views the business.
|
|
|
|
The presentation of income (loss) from consolidated investment management funds, net of net income (loss) attributable to noncontrolling interests related to the consolidation of certain investment management funds permits investors to view revenue on a basis consistent with how management views the business. BNY Mellon believes that these presentations, as a supplement to GAAP information, give investors a clearer picture of the results of its primary businesses.
|
|
|
|
Net interest revenue (FTE) – Non-GAAP and net interest margin (FTE) – Non-GAAP include the tax equivalent adjustments on tax-exempt income which allows for comparisons of amounts arising from both taxable and tax-exempt sources and is consistent with industry practice. The adjustment to an FTE basis has no impact on net income.
|
18
|
19
|
20
|
21
|
22
|
23
|