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21st October 2011

BNY Mellon ups profit on year ago

BNY Mellon reported Q3 net attributable profit of $651m (€471m £412m ¥50.0bn Y4,152m) and 9 month profit of $2,011m (€1,454m £1,272m ¥154.4bn Y12,827m), up 5% and up 9% on the respective periods of 2010. The Q3 profit was down 11.4% on Q2 as income shrank more than expenses. This may indicate that BNY Mellon will have to join many other banks in introducing further expense reductions.


Q3 Return on Common Equity was 7.6% down from 7.8% a year ago and down from 8.8% for 2011-Q2. Assets under Custody or Administration were $25.9tr (€18.7tr £16.4tr ¥1,989tr Y165.2tr), up 6% on a year ago and down 2% on the previous quarter. AUM alone was $1.2tr, up 5% and down 6%.


Income summary 2011-Q3 2010-Q3 2011-9m 2010-9m
$m $m $m $m
Fee and other revenue
Investment services fees:
Asset servicing 928 870 2,831 2,175
Issuer services 442 364 1,158 1,051
Clearing services 297 252 881 727
Treasury services 127 132 382 388
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Total investment services fees 1,794 1,618 5,252 4,341
Investment management and performance fees 729 696 2,272 2,068
Foreign exchange and other trading revenue 194 146 614 628
Distribution and servicing 43 56 145 155
Financing-related fees 40 49 132 147
Investment and other income 89 97 315 387
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Total fee revenue 2,889 2,662 8,730 7,726
Net securities gains (losses) -2 6 51 26
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Total fee and other revenue 2,887 2,668 8,781 7,752

Consolidated investment management funds
Investment income 169 144 562 487
Interest: investment mgmt fund note holders 137 107 357 320
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Income:consolidated investment mgmt funds 32 37 205 167

Net interest revenue
Interest revenue 928 859 2,663 2,578
Interest expense 153 141 459 373
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Net interest revenue 775 718 2,204 2,205
Provision for credit losses -22 -22 -22 33
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Net interest revenue after provisions 797 740 2,226 2,172

Noninterest expense
Staff 1,457 1,344 4,344 3,798
Professional, legal, other services 311 282 895 779
Software and equipment 193 187 602 518
Net occupancy 151 150 465 430
Distribution and servicing 100 94 320 273
Sub-custodian 80 60 236 177
Business development 57 63 186 183
Other 304 249 873 800
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Subtotal 2,653 2,429 7,921 6,958
Amortization of intangible assets 106 111 322 306
Restructuring charges -5 15 -18 7
Merger and integration expenses 17 56 59 96
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Total noninterest expense 2,771 2,611 8,284 7,367

Income
Income from continuing operations 945 834 2,928 2,724
Provision for income taxes 281 220 837 782
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Net income from continuing operations 664 614 2,091 1,942

Discontinued operations:
Loss from discontinued operations - -6 - -92
Benefit for income taxes - -3 - -37
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Net loss from discontinued operations - -3 - -55

Net income 664 611 2,091 1,887
Attributable to noncontrolling interests -13 11 -80 -48
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Applicable to common shareholders 651 622 2,011 1,839