|
|
Delaware
|
001-35651
|
13-2614959
|
(State or other jurisdiction
of incorporation) |
(Commission
File Number) |
(I.R.S. Employer
Identification No.)
|
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
|
Trading
symbol(s)
|
Name of each exchange
on which registered
|
Common Stock, $0.01 par value
|
BK
|
New York Stock Exchange
|
Depositary Shares, each representing 1/4,000th of a share of Series C Noncumulative Perpetual Preferred Stock
|
BK PrC
|
New York Stock Exchange
|
6.244% Fixed-to-Floating Rate Normal Preferred Capital Securities of Mellon Capital IV
|
BK/P
|
New York Stock Exchange
|
(fully and unconditionally guaranteed by The Bank of New York Mellon Corporation)
|
|
|
Exhibit
|
|
|
|
Number
|
|
Description
|
|
|
|
|
|
99.1
|
|
|
|
|
|
|
|
99.2
|
|
|
|
|
|
|
|
99.3
|
|
|
|
|
|
|
|
104
|
|
|
Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document.
|
|
The Bank of New York Mellon Corporation
(Registrant)
|
Date: January 16, 2020
|
By: /s/ James J. Killerlane III
|
|
Name: James J. Killerlane III
Title: Secretary
|
News Release
|
|
Revenue up 19% (a)
|
|
EPS up 81% (a)
|
|
ROE 15%
ROTCE 29% (b)
|
|
CET1 11.5%
SLR 6.1%
|
(a)
|
Excluding notable items, revenue down slightly and EPS up 2% (b).
|
|
4Q19 vs.
|
||||||||||||
|
4Q19
|
|
3Q19
|
|
4Q18
|
|
3Q19
|
|
4Q18
|
|
|||
Net income applicable to common shareholders (in millions)
|
$
|
1,391
|
|
$
|
1,002
|
|
$
|
832
|
|
39
|
%
|
67
|
%
|
Diluted earnings per common share
|
$
|
1.52
|
|
$
|
1.07
|
|
$
|
0.84
|
|
42
|
%
|
81
|
%
|
Notable Items
|
Fourth Quarter Results
|
•
|
Fee revenue increased 26%; nearly all of the increase driven by the gain on sale of an equity investment
|
•
|
Net interest revenue decreased 8%
|
•
|
Continued investments in technology
|
•
|
Total revenue decreased 2%
|
•
|
Income before taxes decreased 9%
|
•
|
AUC/A of $37.1 trillion, increased 12%
|
•
|
Total revenue increased 1%
|
•
|
Income before taxes decreased 1%
|
•
|
AUM of $1.9 trillion, increased 11%
|
CEO Commentary
|
Media Relations: Jennifer Hendricks Sullivan (212) 635-1374
|
Investor Relations: Magda Palczynska (212) 635-8529
|
(b) For information on this Non-GAAP measure, see “Supplemental Information – Explanation of GAAP and Non-GAAP financial measures” on page 9.
|
|
Note: Above comparisons are 4Q19 vs. 4Q18.
|
BNY Mellon 4Q19 Earnings Release
|
(in millions, except per share amounts and unless otherwise noted; not
meaningful - N/M)
|
4Q19
|
|
4Q18
|
|
4Q19 vs. 4Q18
|
|||||||||||||||||||
Results -
GAAP
|
|
Notable
items (a)
|
|
Results -
Non-GAAP
|
|
|
Results -
GAAP
|
|
Notable
items (b)
|
|
Results -
Non-GAAP
|
|
|
GAAP
|
|
Non-
GAAP
|
|
|||||||
Fee revenue
|
$
|
3,971
|
|
$
|
815
|
|
$
|
3,156
|
|
|
$
|
3,146
|
|
$
|
—
|
|
$
|
3,146
|
|
|
26
|
%
|
—
|
|
Net securities (losses)
|
(25
|
)
|
(25
|
)
|
—
|
|
|
—
|
|
—
|
|
—
|
|
|
N/M
|
N/M
|
||||||||
Total fee and other revenue
|
3,946
|
|
790
|
|
3,156
|
|
|
3,146
|
|
—
|
|
3,146
|
|
|
25
|
|
—
|
|
||||||
Income (loss) from consolidated investment management funds
|
17
|
|
—
|
|
17
|
|
|
(24
|
)
|
—
|
|
(24
|
)
|
|
N/M
|
N/M
|
||||||||
Net interest revenue
|
815
|
|
—
|
|
815
|
|
|
885
|
|
—
|
|
885
|
|
|
(8
|
)
|
(8
|
)
|
||||||
Total revenue
|
4,778
|
|
790
|
|
3,988
|
|
|
4,007
|
|
—
|
|
4,007
|
|
|
19
|
|
—
|
|
||||||
Provision for credit losses
|
(8
|
)
|
—
|
|
(8
|
)
|
|
—
|
|
—
|
|
—
|
|
|
N/M
|
N/M
|
||||||||
Noninterest expense
|
2,964
|
|
186
|
|
2,778
|
|
|
2,987
|
|
269
|
|
2,718
|
|
|
(1
|
)
|
2
|
|
||||||
Income (loss) before income taxes
|
1,822
|
|
604
|
|
1,218
|
|
|
1,020
|
|
(269
|
)
|
1,289
|
|
|
79
|
|
(6
|
)
|
||||||
Provision (benefit) for income taxes
|
373
|
|
144
|
|
229
|
|
|
150
|
|
(114
|
)
|
264
|
|
|
149
|
|
(13
|
)
|
||||||
Net income (loss)
|
$
|
1,449
|
|
$
|
460
|
|
$
|
989
|
|
|
$
|
870
|
|
$
|
(155
|
)
|
$
|
1,025
|
|
|
67
|
%
|
(4
|
)%
|
Net income (loss) applicable to common shareholders of The Bank of New York Mellon Corporation
|
$
|
1,391
|
|
$
|
460
|
|
$
|
931
|
|
|
$
|
832
|
|
$
|
(155
|
)
|
$
|
987
|
|
|
67
|
%
|
(6
|
)%
|
Operating leverage (c)
|
|
|
|
|
|
|
|
|
2,001
|
bps
|
(268
|
) bps
|
||||||||||||
Diluted earnings per common share
|
$
|
1.52
|
|
$
|
0.50
|
|
$
|
1.01
|
|
(d)
|
$
|
0.84
|
|
$
|
(0.16
|
)
|
$
|
0.99
|
|
(d)
|
81
|
%
|
2
|
%
|
Average common shares and equivalents outstanding - diluted (in thousands)
|
914,739
|
|
|
|
|
988,650
|
|
|
|
|
|
|
||||||||||||
Pre-tax operating margin
|
38
|
%
|
|
31
|
%
|
|
25
|
%
|
|
32
|
%
|
|
|
|
(a)
|
Includes a gain on sale of an equity investment, severance, net securities losses and litigation expense.
|
(b)
|
Includes adjustments to provisional estimates for U.S. tax legislation and other changes, severance, expenses associated with consolidating real estate and litigation expense.
|
(c)
|
Operating leverage is the rate of increase (decrease) in total revenue less the rate of increase (decrease) in total noninterest expense.
|
(d)
|
Does not foot due to rounding.
|
•
|
Total revenue increased 19%, or decreased slightly excluding the notable items (a), primarily reflecting:
|
•
|
Fee revenue increased 26%, primarily reflecting the gain on sale of an equity investment. Excluding this gain, fee revenue increased slightly, primarily reflecting higher investment services fees, partially offset by lower foreign exchange revenue.
|
•
|
Net interest revenue decreased 8% primarily reflecting the impact of lower interest rates on interest-earning assets and lower noninterest-bearing deposits. This was partially offset by the benefit of lower deposit and funding rates and higher interest-bearing deposits.
|
•
|
Noninterest expense decreased 1%, or increased 2% excluding notable items (a). The increase primarily reflects the continued investments in technology.
|
•
|
Effective tax rate of 20.5%.
|
•
|
AUC/A of $37.1 trillion, increased 12%, primarily reflecting higher market values and client inflows.
|
•
|
AUM of $1.9 trillion, increased 11%, primarily reflecting higher market values and the favorable impact of a weaker U.S. dollar (principally versus the British pound), partially offset by net outflows.
|
•
|
Repurchased 22.2 million common shares for $1.04 billion and paid $286 million in dividends to common shareholders.
|
•
|
Return on common equity (“ROE”) of 15%; Return on tangible common equity (“ROTCE”) of 29% (a).
|
•
|
Common Equity Tier 1 (“CET1”) ratio – 11.5%.
|
•
|
Supplementary leverage ratio (“SLR”) – 6.1%.
|
•
|
Average liquidity coverage ratio (“LCR”) – 120%.
|
•
|
Total Loss Absorbing Capacity (“TLAC”) ratios exceed minimum requirements.
|
|
(a)
|
See “Supplemental information – Explanation of GAAP and Non-GAAP financial measures” on page 9 for additional information.
|
Page - 2
|
BNY Mellon 4Q19 Earnings Release
|
(in millions, except per share amounts and unless otherwise noted; not
meaningful - N/M)
|
2019
|
|
2018
|
|
2019 vs. 2018
|
|||||||||||||||||||
Results -
GAAP
|
|
Notable
items (a)
|
|
Results -
Non-GAAP
|
|
|
Results -
GAAP
|
|
Notable
items (b)
|
|
Results -
Non-GAAP
|
|
|
GAAP
|
|
Non-
GAAP
|
|
|||||||
Fee revenue
|
$
|
13,236
|
|
$
|
815
|
|
$
|
12,421
|
|
|
$
|
12,842
|
|
$
|
(13
|
)
|
$
|
12,855
|
|
|
3
|
%
|
(3
|
)%
|
Net securities (losses) gains
|
(18
|
)
|
(25
|
)
|
7
|
|
|
(48
|
)
|
—
|
|
(48
|
)
|
|
N/M
|
N/M
|
||||||||
Total fee and other revenue (loss)
|
13,218
|
|
790
|
|
12,428
|
|
|
12,794
|
|
(13
|
)
|
12,807
|
|
|
3
|
|
(3
|
)
|
||||||
Income (loss) from consolidated investment management funds
|
56
|
|
—
|
|
56
|
|
|
(13
|
)
|
—
|
|
(13
|
)
|
|
N/M
|
N/M
|
||||||||
Net interest revenue (expense)
|
3,188
|
|
(70
|
)
|
3,258
|
|
|
3,611
|
|
—
|
|
3,611
|
|
|
(12
|
)
|
(10
|
)
|
||||||
Total revenue (loss)
|
16,462
|
|
720
|
|
15,742
|
|
|
16,392
|
|
(13
|
)
|
16,405
|
|
|
—
|
|
(4
|
)
|
||||||
Provision for credit losses
|
(25
|
)
|
—
|
|
(25
|
)
|
|
(11
|
)
|
—
|
|
(11
|
)
|
|
N/M
|
N/M
|
||||||||
Noninterest expense
|
10,900
|
|
113
|
|
10,787
|
|
|
11,211
|
|
343
|
|
10,868
|
|
|
(3
|
)
|
(1
|
)
|
||||||
Income (loss) before income taxes
|
5,587
|
|
607
|
|
4,980
|
|
|
5,192
|
|
(356
|
)
|
5,548
|
|
|
8
|
|
(10
|
)
|
||||||
Provision (benefit) for income taxes
|
1,120
|
|
140
|
|
980
|
|
|
938
|
|
(188
|
)
|
1,126
|
|
|
19
|
|
(13
|
)
|
||||||
Net income (loss)
|
$
|
4,467
|
|
$
|
467
|
|
$
|
4,000
|
|
|
$
|
4,254
|
|
$
|
(168
|
)
|
$
|
4,422
|
|
|
5
|
%
|
(10
|
)%
|
Net income (loss) applicable to common shareholders of The Bank of New York Mellon Corporation
|
$
|
4,272
|
|
$
|
467
|
|
$
|
3,805
|
|
|
$
|
4,097
|
|
$
|
(168
|
)
|
$
|
4,265
|
|
|
4
|
%
|
(11
|
)%
|
Operating leverage (c)
|
|
|
|
|
|
|
|
|
320
|
bps
|
(330
|
) bps
|
||||||||||||
Diluted earnings per common share
|
$
|
4.51
|
|
$
|
0.49
|
|
$
|
4.02
|
|
|
$
|
4.04
|
|
$
|
(0.17
|
)
|
$
|
4.21
|
|
|
12
|
%
|
(5
|
)%
|
Average common shares and equivalents outstanding - diluted (in thousands)
|
943,109
|
|
|
|
|
1,007,141
|
|
|
|
|
|
|
||||||||||||
Pre-tax operating margin
|
34
|
%
|
|
32
|
%
|
|
32
|
%
|
|
34
|
%
|
|
|
|
(a)
|
Includes a gain on sale of an equity investment, severance, net securities losses and litigation expense recorded in 4Q19. Also includes a lease-related impairment and a net reduction of reserves for tax-related exposure of certain investment management funds recorded in 3Q19.
|
(b)
|
Includes adjustments to provisional estimates for U.S. tax legislation and other changes, severance, expenses associated with consolidating real estate and litigation expense, each recorded in 4Q18. Also includes expenses associated with consolidating real estate recorded in 2Q18 and adjustments to provisional estimates for U.S. tax legislation and other changes and litigation expense, both recorded in 3Q18.
|
(c)
|
Operating leverage is the rate of increase (decrease) in total revenue less the rate of increase (decrease) in total noninterest expense.
|
Page - 3
|
BNY Mellon 4Q19 Earnings Release
|
(dollars in millions, unless otherwise noted; not meaningful - N/M)
|
|
|
|
4Q19 vs.
|
|||||||||
4Q19
|
|
3Q19
|
|
4Q18
|
|
3Q19
|
|
4Q18
|
|
||||
Total revenue by line of business:
|
|
|
|
|
|
||||||||
Asset Servicing
|
$
|
1,397
|
|
$
|
1,405
|
|
$
|
1,435
|
|
(1
|
)%
|
(3
|
)%
|
Pershing
|
570
|
|
568
|
|
558
|
|
—
|
|
2
|
|
|||
Issuer Services
|
415
|
|
466
|
|
441
|
|
(11
|
)
|
(6
|
)
|
|||
Treasury Services
|
329
|
|
312
|
|
328
|
|
5
|
|
—
|
|
|||
Clearance and Collateral Management
|
280
|
|
293
|
|
278
|
|
(4
|
)
|
1
|
|
|||
Total revenue by line of business
|
2,991
|
|
3,044
|
|
3,040
|
|
(2
|
)
|
(2
|
)
|
|||
Provision for credit losses
|
(5
|
)
|
(15
|
)
|
6
|
|
N/M
|
N/M
|
|||||
Noninterest expense
|
2,161
|
|
1,965
|
|
2,112
|
|
10
|
|
2
|
|
|||
Income before taxes
|
$
|
835
|
|
$
|
1,094
|
|
$
|
922
|
|
(24
|
)%
|
(9
|
)%
|
|
|
|
|
|
|
||||||||
Pre-tax operating margin
|
28
|
%
|
36
|
%
|
30
|
%
|
|
|
|||||
|
|
|
|
|
|
||||||||
Foreign exchange and other trading revenue
|
$
|
151
|
|
$
|
160
|
|
$
|
163
|
|
(6
|
)%
|
(7
|
)%
|
Securities lending revenue
|
$
|
40
|
|
$
|
39
|
|
$
|
43
|
|
3
|
%
|
(7
|
)%
|
|
|
|
|
|
|
|
|
||||||
Metrics:
|
|
|
|
|
|
|
|
||||||
Average loans
|
$
|
34,238
|
|
$
|
32,758
|
|
$
|
35,540
|
|
5
|
%
|
(4
|
)%
|
Average deposits
|
$
|
215,388
|
|
$
|
208,044
|
|
$
|
203,416
|
|
4
|
%
|
6
|
%
|
|
|
|
|
|
|
|
|||||||
AUC/A at period end (in trillions) (current period is preliminary) (a)
|
$
|
37.1
|
|
$
|
35.8
|
|
$
|
33.1
|
|
4
|
%
|
12
|
%
|
Market value of securities on loan at period end (in billions) (b)
|
$
|
378
|
|
$
|
362
|
|
$
|
373
|
|
4
|
%
|
1
|
%
|
(a)
|
Includes the AUC/A of CIBC Mellon Global Securities Services Company (“CIBC Mellon”), a joint venture with the Canadian Imperial Bank of Commerce, of $1.5 trillion at Dec. 31, 2019, $1.4 trillion at Sept. 30, 2019 and $1.2 trillion at Dec. 31, 2018.
|
(b)
|
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 $60 billion at Dec. 31, 2019, $66 billion at Sept. 30, 2019 and $58 billion at Dec. 31, 2018.
|
•
|
The drivers of the total revenue variances by line of business are indicated below.
|
•
|
Asset Servicing - The year-over-year decrease primarily reflects lower net interest revenue and foreign exchange revenue, partially offset by the impact of higher equity markets. The sequential decrease primarily reflects lower net interest revenue.
|
•
|
Pershing - The year-over-year increase primarily reflects growth in client assets and accounts, partially offset by lower net interest revenue.
|
•
|
Issuer Services - Both decreases primarily reflect lower Depositary Receipts revenue. The year-over-year decrease is partially offset by higher client activity in Corporate Trust. The sequential decrease is partially offset by higher net interest revenue in Corporate Trust.
|
•
|
Treasury Services - Year-over-year, higher payment fees were offset by lower net interest revenue. The sequential increase primarily reflects higher net interest revenue and payment fees.
|
•
|
Clearance and Collateral Management - The year-over-year increase primarily reflects growth in collateral management and clearance volumes, which were mostly offset by lower net interest revenue. The sequential decrease primarily reflects lower client activity.
|
•
|
Noninterest expense increased year-over-year primarily driven by continued investments in technology. The sequential increase primarily reflects higher severance expense, continued investments in technology and higher litigation expense.
|
Page - 4
|
BNY Mellon 4Q19 Earnings Release
|
(dollars in millions, unless otherwise noted; not meaningful - N/M)
|
|
|
|
4Q19 vs.
|
|||||||||
4Q19
|
|
3Q19
|
|
4Q18
|
|
3Q19
|
|
4Q18
|
|
||||
Total revenue by line of business:
|
|
|
|
|
|
||||||||
Asset Management
|
$
|
688
|
|
$
|
605
|
|
$
|
660
|
|
14
|
%
|
4
|
%
|
Wealth Management
|
287
|
|
285
|
|
303
|
|
1
|
|
(5
|
)
|
|||
Total revenue by line of business
|
975
|
|
890
|
|
963
|
|
10
|
|
1
|
|
|||
Provision for credit losses
|
—
|
|
—
|
|
1
|
|
N/M
|
N/M
|
|||||
Noninterest expense
|
730
|
|
590
|
|
715
|
|
24
|
|
2
|
|
|||
Income before taxes
|
$
|
245
|
|
$
|
300
|
|
$
|
247
|
|
(18
|
)%
|
(1
|
)%
|
|
|
|
|
|
|
||||||||
Pre-tax operating margin
|
25
|
%
|
34
|
%
|
26
|
%
|
|
|
|||||
Adjusted pre-tax operating margin – Non-GAAP (a)
|
28
|
%
|
38
|
%
|
29
|
%
|
|
|
|||||
|
|
|
|
|
|
||||||||
Metrics:
|
|
|
|
|
|
||||||||
Average loans
|
$
|
16,505
|
|
$
|
16,260
|
|
$
|
16,485
|
|
2
|
%
|
—
|
|
Average deposits
|
$
|
15,195
|
|
$
|
14,083
|
|
$
|
14,893
|
|
8
|
%
|
2
|
%
|
|
|
|
|
|
|
||||||||
AUM (in billions) (current period is preliminary) (b)
|
$
|
1,910
|
|
$
|
1,881
|
|
$
|
1,722
|
|
2
|
%
|
11
|
%
|
Wealth Management client assets (in billions) (current period is preliminary) (c)
|
$
|
266
|
|
$
|
259
|
|
$
|
239
|
|
3
|
%
|
11
|
%
|
(a)
|
Net of distribution and servicing expense. See “Supplemental information – Explanation of GAAP and Non-GAAP financial measures” on page 9 for information on this Non-GAAP measure.
|
(b)
|
Excludes securities lending cash management assets and assets managed in the Investment Services business.
|
(c)
|
Includes AUM and AUC/A in the Wealth Management business.
|
•
|
The drivers of the total revenue variances by line of business are indicated below.
|
•
|
Asset Management - The year-over-year increase primarily reflects higher market values and the impact of hedging activities, partially offset by the cumulative AUM outflows since 4Q18. The sequential increase primarily reflects timing of performance fees, the impact of hedging activities and higher market values.
|
•
|
Wealth Management - The year-over-year decrease primarily reflects lower net interest revenue, partially offset by higher market values.
|
•
|
Noninterest expense increased year-over-year primarily reflecting higher staff expense. The sequential increase primarily reflects the net reduction of the reserves for tax-related exposure of certain investment management funds recorded in 3Q19 and higher staff expense, including severance expense.
|
Page - 5
|
BNY Mellon 4Q19 Earnings Release
|
|
|
|
|
||||||
(in millions)
|
4Q19
|
|
3Q19
|
|
4Q18
|
|
|||
Fee revenue
|
$
|
836
|
|
$
|
5
|
|
$
|
29
|
|
Net securities (losses)
|
(23
|
)
|
(1
|
)
|
—
|
|
|||
Total fee and other revenue
|
813
|
|
4
|
|
29
|
|
|||
Net interest (expense)
|
(10
|
)
|
(80
|
)
|
(15
|
)
|
|||
Total revenue (loss)
|
803
|
|
(76
|
)
|
14
|
|
|||
Provision for credit losses
|
(3
|
)
|
(1
|
)
|
(7
|
)
|
|||
Noninterest expense
|
73
|
|
35
|
|
160
|
|
|||
Income (loss) before taxes
|
$
|
733
|
|
$
|
(110
|
)
|
$
|
(139
|
)
|
•
|
Fee revenue, net securities losses and net interest expense include corporate treasury and other investment activity, including hedging activity which offsets between fee revenue and net interest expense. Total revenue increased primarily reflecting the gain on the sale of an equity investment. Net interest expense decreased sequentially primarily reflecting the lease-related impairment of $70 million recorded in 3Q19.
|
•
|
Noninterest expense decreased year-over-year primarily reflecting the expenses associated with relocating our corporate headquarters recorded in 4Q18 and lower severance expense. The sequential increase primarily reflects higher severance expense, partially offset by lower other staff expense.
|
Notable items by business segment
(in millions)
|
4Q19
|
|
3Q19
|
|
4Q18
|
|||||||||||||||||||||||||||||||||
IS
|
|
IM
|
|
Other
|
|
Total
|
|
|
IS
|
|
IM
|
|
Other
|
|
Total
|
|
|
IS
|
|
IM
|
|
Other
|
|
Total
|
|
|||||||||||||
Fee and other revenue
|
$
|
—
|
|
$
|
—
|
|
$
|
790
|
|
$
|
790
|
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
Net interest revenue
|
—
|
|
—
|
|
—
|
|
—
|
|
|
—
|
|
—
|
|
(70
|
)
|
(70
|
)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||||||||
Total revenue
|
—
|
|
—
|
|
790
|
|
790
|
|
|
—
|
|
—
|
|
(70
|
)
|
(70
|
)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||||||||
Total noninterest expense
|
119
|
|
16
|
|
51
|
|
186
|
|
|
—
|
|
(74
|
)
|
—
|
|
(74
|
)
|
|
110
|
|
28
|
|
131
|
|
269
|
|
||||||||||||
Income (loss) before taxes
|
$
|
(119
|
)
|
$
|
(16
|
)
|
$
|
739
|
|
$
|
604
|
|
|
$
|
—
|
|
$
|
74
|
|
$
|
(70
|
)
|
$
|
4
|
|
|
$
|
(110
|
)
|
$
|
(28
|
)
|
$
|
(131
|
)
|
$
|
(269
|
)
|
Page - 6
|
BNY Mellon 4Q19 Earnings Release
|
Capital and liquidity ratios
|
Dec. 31, 2019
|
|
Sept. 30, 2019
|
|
Dec. 31, 2018
|
|
|||
Consolidated regulatory capital ratios: (a)
|
|
|
|
||||||
CET1 ratio
|
11.5
|
%
|
11.1
|
%
|
10.7
|
%
|
|||
Tier 1 capital ratio
|
13.6
|
|
13.2
|
|
12.8
|
|
|||
Total capital ratio
|
14.4
|
|
14.0
|
|
13.6
|
|
|||
Tier 1 leverage ratio
|
6.6
|
|
6.5
|
|
6.6
|
|
|||
SLR
|
6.1
|
|
6.0
|
|
6.0
|
|
|||
BNY Mellon shareholders’ equity to total assets ratio
|
10.9
|
%
|
11.0
|
%
|
11.2
|
%
|
|||
BNY Mellon common shareholders’ equity to total assets ratio
|
9.9
|
%
|
10.1
|
%
|
10.2
|
%
|
|||
|
|
|
|
||||||
Average LCR
|
120
|
%
|
117
|
%
|
118
|
%
|
|||
|
|
|
|
||||||
Book value per common share (b)
|
$
|
42.12
|
|
$
|
40.75
|
|
$
|
38.63
|
|
Tangible book value per common share – Non-GAAP (b)
|
$
|
21.33
|
|
$
|
20.59
|
|
$
|
19.04
|
|
Common shares outstanding (in thousands)
|
900,683
|
|
922,199
|
|
960,426
|
|
(a)
|
Regulatory capital ratios for Dec. 31, 2019 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, which for the periods noted above was the Advanced Approaches.
|
(b)
|
Tangible book value per common share – Non-GAAP excludes goodwill and intangible assets, net of deferred tax liabilities. See “Supplemental information – Explanation of GAAP and Non-GAAP financial measures” on page 9 for information on this Non-GAAP measure.
|
Net interest revenue
|
|
|
|
|
4Q19 vs.
|
|||||||||
(dollars in millions; not meaningful - N/M)
|
4Q19
|
|
3Q19
|
|
|
4Q18
|
|
3Q19
|
|
4Q18
|
|
|||
Net interest revenue
|
$
|
815
|
|
$
|
730
|
|
|
$
|
885
|
|
12
|
%
|
(8
|
)%
|
Add: Tax equivalent adjustment
|
2
|
|
3
|
|
|
4
|
|
N/M
|
N/M
|
|||||
Net interest revenue, on a fully taxable equivalent (“FTE”)
basis – Non-GAAP (a)
|
$
|
817
|
|
$
|
733
|
|
|
$
|
889
|
|
11
|
%
|
(8
|
)%
|
|
|
|
|
|
|
|
||||||||
Net interest margin
|
1.09
|
%
|
0.99
|
%
|
(b)
|
1.24
|
%
|
10
|
bps
|
(15
|
) bps
|
|||
Net interest margin (FTE) – Non-GAAP (a)
|
1.09
|
%
|
1.00
|
%
|
(b)
|
1.24
|
%
|
9
|
bps
|
(15
|
) bps
|
(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)
|
The lease-related impairment decreased the net interest margin for 3Q19 by 10 basis points.
|
Page - 7
|
BNY Mellon 4Q19 Earnings Release
|
(in millions)
|
Quarter ended
|
|
Year-to-date
|
||||||||||||||
Dec. 31, 2019
|
|
Sept. 30, 2019
|
|
Dec. 31, 2018
|
|
|
Dec. 31, 2019
|
|
Dec. 31, 2018
|
|
|||||||
Fee and other revenue
|
|
|
|
|
|
|
|||||||||||
Investment services fees:
|
|
|
|
|
|
|
|||||||||||
Asset servicing fees
|
$
|
1,148
|
|
$
|
1,152
|
|
$
|
1,126
|
|
|
$
|
4,563
|
|
$
|
4,608
|
|
|
Clearing services fees (a)
|
421
|
|
419
|
|
398
|
|
|
1,648
|
|
1,616
|
|
||||||
Issuer services fees
|
264
|
|
324
|
|
286
|
|
|
1,130
|
|
1,099
|
|
||||||
Treasury services fees
|
147
|
|
140
|
|
139
|
|
|
559
|
|
554
|
|
||||||
Total investment services fees (a)
|
1,980
|
|
2,035
|
|
1,949
|
|
|
7,900
|
|
7,877
|
|
||||||
Investment management and performance fees (a)
|
883
|
|
832
|
|
884
|
|
|
3,389
|
|
3,647
|
|
||||||
Foreign exchange and other trading revenue
|
168
|
|
150
|
|
181
|
|
|
654
|
|
732
|
|
||||||
Financing-related fees
|
46
|
|
49
|
|
50
|
|
|
196
|
|
207
|
|
||||||
Distribution and servicing
|
34
|
|
33
|
|
35
|
|
|
129
|
|
139
|
|
||||||
Investment and other income
|
860
|
|
30
|
|
47
|
|
|
968
|
|
240
|
|
||||||
Total fee revenue
|
3,971
|
|
3,129
|
|
3,146
|
|
|
13,236
|
|
12,842
|
|
||||||
Net securities (losses) gains
|
(25
|
)
|
(1
|
)
|
—
|
|
|
(18
|
)
|
(48
|
)
|
||||||
Total fee and other revenue
|
3,946
|
|
3,128
|
|
3,146
|
|
|
13,218
|
|
12,794
|
|
||||||
Operations of consolidated investment management funds
|
|
|
|
|
|
|
|||||||||||
Investment income
|
17
|
|
4
|
|
(24
|
)
|
|
57
|
|
(12
|
)
|
||||||
Interest of investment management fund note holders
|
—
|
|
1
|
|
—
|
|
|
1
|
|
1
|
|
||||||
Income from consolidated investment management funds
|
17
|
|
3
|
|
(24
|
)
|
|
56
|
|
(13
|
)
|
||||||
Net interest revenue
|
|
|
|
|
|
|
|||||||||||
Interest revenue
|
1,721
|
|
1,942
|
|
1,864
|
|
|
7,548
|
|
6,432
|
|
||||||
Interest expense
|
906
|
|
1,212
|
|
979
|
|
|
4,360
|
|
2,821
|
|
||||||
Net interest revenue
|
815
|
|
730
|
|
885
|
|
|
3,188
|
|
3,611
|
|
||||||
Total revenue
|
4,778
|
|
3,861
|
|
4,007
|
|
|
16,462
|
|
16,392
|
|
||||||
Provision for credit losses
|
(8
|
)
|
(16
|
)
|
—
|
|
|
(25
|
)
|
(11
|
)
|
||||||
Noninterest expense
|
|
|
|
|
|
|
|||||||||||
Staff
|
1,639
|
|
1,479
|
|
1,602
|
|
|
6,063
|
|
6,145
|
|
||||||
Professional, legal and other purchased services
|
367
|
|
316
|
|
383
|
|
|
1,345
|
|
1,334
|
|
||||||
Software and equipment
|
326
|
|
309
|
|
300
|
|
|
1,222
|
|
1,062
|
|
||||||
Net occupancy
|
151
|
|
138
|
|
196
|
|
|
564
|
|
630
|
|
||||||
Sub-custodian and clearing
|
119
|
|
111
|
|
115
|
|
|
450
|
|
450
|
|
||||||
Distribution and servicing
|
92
|
|
97
|
|
95
|
|
|
374
|
|
406
|
|
||||||
Business development
|
65
|
|
47
|
|
64
|
|
|
213
|
|
228
|
|
||||||
Bank assessment charges
|
32
|
|
31
|
|
22
|
|
|
125
|
|
170
|
|
||||||
Amortization of intangible assets
|
28
|
|
30
|
|
35
|
|
|
117
|
|
180
|
|
||||||
Other
|
145
|
|
32
|
|
175
|
|
|
427
|
|
606
|
|
||||||
Total noninterest expense
|
2,964
|
|
2,590
|
|
2,987
|
|
|
10,900
|
|
11,211
|
|
||||||
Income
|
|
|
|
|
|
|
|||||||||||
Income before income taxes
|
1,822
|
|
1,287
|
|
1,020
|
|
|
5,587
|
|
5,192
|
|
||||||
Provision for income taxes
|
373
|
|
246
|
|
150
|
|
|
1,120
|
|
938
|
|
||||||
Net income
|
1,449
|
|
1,041
|
|
870
|
|
|
4,467
|
|
4,254
|
|
||||||
Net (income) loss attributable to noncontrolling interests (includes $(9), $(3), $11, $(26) and $12 related to consolidated investment management funds, respectively)
|
(9
|
)
|
(3
|
)
|
11
|
|
|
(26
|
)
|
12
|
|
||||||
Net income applicable to shareholders of The Bank of New York Mellon Corporation
|
1,440
|
|
1,038
|
|
881
|
|
|
4,441
|
|
4,266
|
|
||||||
Preferred stock dividends
|
(49
|
)
|
(36
|
)
|
(49
|
)
|
|
(169
|
)
|
(169
|
)
|
||||||
Net income applicable to common shareholders of The Bank of New York Mellon Corporation
|
$
|
1,391
|
|
$
|
1,002
|
|
$
|
832
|
|
|
$
|
4,272
|
|
$
|
4,097
|
|
(a)
|
In 1Q19, we reclassified certain platform-related fees to clearing services fees from investment management and performance fees. Prior periods have been reclassified.
|
Earnings per share applicable to the common shareholders of The Bank of New York Mellon Corporation
|
Quarter ended
|
|
Year-to-date
|
|||||||||||||
Dec. 31, 2019
|
|
Sept. 30, 2019
|
|
Dec. 31, 2018
|
|
|
Dec. 31, 2019
|
|
Dec. 31, 2018
|
|
||||||
(in dollars)
|
||||||||||||||||
Basic
|
$
|
1.52
|
|
$
|
1.07
|
|
$
|
0.84
|
|
|
$
|
4.53
|
|
$
|
4.06
|
|
Diluted
|
$
|
1.52
|
|
$
|
1.07
|
|
$
|
0.84
|
|
|
$
|
4.51
|
|
$
|
4.04
|
|
Page - 8
|
BNY Mellon 4Q19 Earnings Release
|
Page - 9
|
BNY Mellon 4Q19 Earnings Release
|
Page - 10
|
The Bank of New York Mellon Corporation
|
|
Financial Supplement
|
|
Fourth Quarter 2019
|
|
|
Table of Contents
|
|
|
|
||
|
||
|
|
|
|
|
|
Consolidated Results
|
|
Page
|
Consolidated Financial Highlights
|
|
|
Condensed Consolidated Income Statement
|
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Condensed Consolidated Balance Sheet
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Fee and Other Revenue
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Average Balances and Interest Rates
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Capital and Liquidity
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Business Segment Results
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Investment Services Business
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Investment Management Business
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AUM by Product, AUM Flows and Wealth Management Client Assets
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Other Segment
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Other
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Investment Securities Portfolio
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Allowance for Credit Losses and Nonperforming Assets
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Supplemental Information – Explanation of GAAP and Non-GAAP Financial Measures
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THE BANK OF NEW YORK MELLON CORPORATION
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OTHER SEGMENT
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(in millions)
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4Q19
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3Q19
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2Q19
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1Q19
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|
4Q18
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FY19
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FY18
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Fee revenue
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$
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836
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|
$
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5
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|
$
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34
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|
$
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29
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|
$
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29
|
|
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$
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904
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$
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133
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|
Net securities (losses) gains
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(23
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)
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(1
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)
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7
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|
1
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—
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(16
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)
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(48
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)
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Total fee and other revenue
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813
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4
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41
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|
30
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29
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888
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|
85
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Net interest (expense)
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(10
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)
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(80
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)
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(40
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)
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(30
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)
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(15
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)
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(160
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)
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(64
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)
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Total revenue (loss)
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803
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(76
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)
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1
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—
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14
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728
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21
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Provision for credit losses
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(3
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)
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(1
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)
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(2
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)
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(2
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)
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(7
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)
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(8
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)
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(15
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)
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Noninterest expense
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73
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|
35
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|
39
|
|
61
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|
160
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|
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208
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|
334
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Income (loss) before taxes
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$
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733
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$
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(110
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)
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$
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(36
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)
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$
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(59
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)
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$
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(139
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)
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$
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528
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$
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(298
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)
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Average loans and leases
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$
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1,974
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$
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1,817
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$
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1,764
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$
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1,784
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$
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1,809
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$
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1,836
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$
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2,105
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Average assets
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$
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45,770
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$
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50,569
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$
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47,036
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$
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48,417
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$
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44,964
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$
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48,123
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$
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49,581
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THE BANK OF NEW YORK MELLON CORPORATION
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SUPPLEMENTAL INFORMATION – EXPLANATION OF GAAP AND NON-GAAP FINANCIAL MEASURES
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Book value and tangible book value per common share reconciliation
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2019
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2018
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(dollars in millions, except common shares)
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Dec. 31
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Sept. 30
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June 30
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March 31
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Dec. 31
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BNY Mellon shareholders’ equity at period end – GAAP
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$
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41,483
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$
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41,120
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$
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41,533
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$
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41,225
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$
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40,638
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Less: Preferred stock
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3,542
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3,542
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3,542
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3,542
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3,542
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BNY Mellon common shareholders’ equity at period end – GAAP
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37,941
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37,578
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37,991
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37,683
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37,096
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Less: Goodwill
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17,386
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17,248
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17,337
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17,367
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17,350
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Intangible assets
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3,107
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3,124
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3,160
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3,193
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3,220
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Add: Deferred tax liability – tax deductible goodwill
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1,098
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1,103
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1,094
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1,083
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1,072
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Deferred tax liability – intangible assets
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670
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679
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687
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690
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|
692
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BNY Mellon tangible common shareholders’ equity at period end – Non-GAAP
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$
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19,216
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$
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18,988
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$
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19,275
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$
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18,896
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$
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18,290
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Period-end common shares outstanding (in thousands)
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900,683
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922,199
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942,662
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957,517
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960,426
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Book value per common share – GAAP
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$
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42.12
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$
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40.75
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$
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40.30
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$
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39.36
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$
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38.63
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Tangible book value per common share – Non-GAAP
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$
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21.33
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$
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20.59
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$
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20.45
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$
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19.74
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$
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19.04
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Net interest margin reconciliation
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(dollars in millions)
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4Q19
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3Q19
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2Q19
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1Q19
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4Q18
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Net interest revenue – GAAP
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$
|
815
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$
|
730
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$
|
802
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$
|
841
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$
|
885
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Add: Tax equivalent adjustment
|
2
|
|
3
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|
4
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|
4
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|
|
4
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Net interest revenue (FTE) – Non-GAAP
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$
|
817
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$
|
733
|
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$
|
806
|
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$
|
845
|
|
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$
|
889
|
|
|
|
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Average interest-earning assets
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$
|
297,987
|
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$
|
294,154
|
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$
|
287,417
|
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$
|
282,185
|
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$
|
285,706
|
|
|
|
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Net interest margin – GAAP (a)
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1.09
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%
|
0.99
|
%
|
1.12
|
%
|
1.20
|
%
|
|
1.24
|
%
|
|||||
Net interest margin (FTE) – Non-GAAP (a)
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1.09
|
%
|
1.00
|
%
|
1.12
|
%
|
1.20
|
%
|
|
1.24
|
%
|
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(a) Net interest margin is annualized.
|