Bank of New York Mellon Corp
For the period ended Jun 30, 2024. Filed Aug 2, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2024 · Filed Aug 2, 2024
Extracted filing text, with the paragraph anchors used by the comparison.
See the whole filing, with its images and exhibitsContents
Items 2 and 3. Management’s Discussion and Analysis of Financial Condition and Results of Operations; Quantitative and Qualitative Disclosures about Market Risk
| General | 4 |
|---|---|
| Overview | 4 |
| Key second quarter 2024 and subsequent events | 4 |
| Highlights of second quarter 2024 results | 4 |
| Fee and other revenue | 6 |
| Net interest income | 9 |
| Noninterest expense | 12 |
| Income taxes | 12 |
| Review of business segments | 12 |
| Critical accounting estimates | 22 |
| Consolidated balance sheet review | 23 |
| Liquidity and dividends | 31 |
| Capital | 36 |
| Trading activities and risk management | 39 |
| Asset/liability management | 41 |
| Supplemental information – Explanation of GAAP and Non-GAAP financial measures | 43 |
| Recent accounting and regulatory developments | 47 |
| Website information | 48 |
| Item 1. Financial Statements: | |
| Consolidated Income Statement (unaudited) | 49 |
| Consolidated Comprehensive Income Statement (unaudited) | 51 |
| Consolidated Balance Sheet (unaudited) | 52 |
| Consolidated Statement of Cash Flows (unaudited) | 53 |
| Consolidated Statement of Changes in Equity (unaudited) | 54 |
| Page | |
|---|---|
| Notes to Consolidated Financial Statements: | |
| Note 1—Basis of presentation | 57 |
| Note 2—New accounting guidance | 57 |
| Note 3—Acquisitions and dispositions | 58 |
| Note 4—Securities | 59 |
| Note 5—Loans and asset quality | 63 |
| Note 6—Goodwill and intangible assets | 70 |
| Note 7—Other assets | 72 |
| Note 8—Contract revenue | 73 |
| Note 9—Net interest income | 76 |
| Note 10—Employee benefit plans | 76 |
| Note 11—Income taxes | 77 |
| Note 12—Variable interest entities | 77 |
| Note 13—Preferred stock | 78 |
| Note 14—Other comprehensive income (loss) | 79 |
| Note 15—Fair value measurement | 80 |
| Note 16—Fair value option | 85 |
| Note 17—Derivative instruments | 85 |
| Note 18—Commitments and contingent liabilities | 92 |
| Note 19—Business segments | 97 |
| Note 20—Supplemental information to the Consolidated Statement of Cash Flows | 100 |
| Item 4. Controls and Procedures | 101 |
| Forward-looking Statements | 102 |
| Part II – Other Information | |
| Item 1. Legal Proceedings. | 105 |
| Item 2. Unregistered Sales of Equity Securities and Use of Proceeds. | 105 |
| Item 5. Other Information. | 105 |
| Item 6. Exhibits. | 105 |
| Index to Exhibits | 106 |
| Signature | 108 |
The Bank of New York Mellon Corporation (and its subsidiaries)
Consolidated Financial Highlights (unaudited)
| Quarter ended · Year-to-date | |||||
|---|---|---|---|---|---|
| (dollars in millions, except per share amounts and unless otherwise noted) | June 30, 2024 | March 31, 2024 | June 30, 2023 | June 30, 2024 | June 30, 2023 |
| Results applicable to common shareholders of The Bank of New York Mellon Corporation: | |||||
| Net income (a) | $1,143 | $953 | $1,036 | $2,096 | $1,947 |
| Basic earnings per share (a) | $1.53 | $1.26 | $1.32 | $2.79 | $2.45 |
| Diluted earnings per share (a) | $1.52 | $1.25 | $1.31 | $2.77 | $2.44 |
| Fee and other revenue (a) | $3,567 | $3,487 | $3,404 | $7,054 | $6,691 |
| Net interest income | 1,030 | 1,040 | 1,100 | 2,070 | 2,228 |
| Total revenue (a) | $4,597 | $4,527 | $4,504 | $9,124 | $8,919 |
| Return on common equity (annualized) (a) | 12.7% | 10.7% | 11.7% | 11.7% | 11.0% |
| Return on tangible common equity (annualized) – Non-GAAP (a)(b) | 24.6% | 20.7% | 22.8% | 22.7% | 21.7% |
| Fee revenue as a percentage of total revenue (a) | 74% | 73% | 72% | 73% | 72% |
| Non-U.S. revenue as a percentage of total revenue (a) | 36% | 34% | 36% | 35% | 35% |
| Pre-tax operating margin (a) | 33% | 29% | 31% | 31% | 30% |
| Net interest margin | 1.15% | 1.19% | 1.20% | 1.17% | 1.25% |
| Net interest margin on a fully taxable equivalent (“FTE”) basis – Non-GAAP (c) | 1.15% | 1.19% | 1.20% | 1.17% | 1.25% |
| Assets under custody and/or administration (“AUC/A”) at period end (in trillions) (d) | $49.5 | $48.8 | $46.9 | $49.5 | $46.9 |
| Assets under management (“AUM”) at period end (in trillions) (e) | $2.05 | $2.02 | $1.91 | $2.05 | $1.91 |
| Average common shares and equivalents outstanding (in thousands): | |||||
| Basic | 746,904 | 756,937 | 787,718 | 751,961 | 795,512 |
| Diluted | 751,596 | 762,268 | 790,725 | 756,870 | 799,157 |
| Selected average balances: | |||||
| Interest-earning assets | $353,633 | $346,133 | $362,049 | $349,883 | $355,251 |
| Total assets (a) | $412,499 | $403,985 | $420,961 | $408,242 | $414,157 |
| Interest-bearing deposits | $235,878 | $228,897 | $215,057 | $232,387 | $209,616 |
| Noninterest-bearing deposits | $48,965 | $49,949 | $62,152 | $49,457 | $65,997 |
| Long-term debt | $31,506 | $31,087 | $31,970 | $31,296 | $31,112 |
| Preferred stock | $4,343 | $4,343 | $4,838 | $4,343 | $4,838 |
| Total The Bank of New York Mellon Corporation common shareholders’ equity (a) | $36,044 | $35,905 | $35,655 | $35,975 | $35,569 |
| Other information at period end: | |||||
| Cash dividends per common share | $0.42 | $0.42 | $0.37 | $0.84 | $0.74 |
| Common dividend payout ratio (a) | 28% | 34% | 29% | 31% | 31% |
| Common dividend yield (annualized) | 2.8% | 2.9% | 3.3% | 2.8% | 3.4% |
| Closing stock price per common share | $59.89 | $57.62 | $44.52 | $59.89 | $44.52 |
| Market capitalization | $44,196 | $43,089 | $34,671 | $44,196 | $34,671 |
| Book value per common share (a) | $49.46 | $48.44 | $46.21 | $49.46 | $46.21 |
| Tangible book value per common share – Non-GAAP (a)(b) | $26.19 | $25.44 | $24.03 | $26.19 | $24.03 |
| Full-time employees (f) | 52,000 | 52,100 | 53,200 | 52,000 | 53,200 |
| Common shares outstanding (in thousands) | 737,957 | 747,816 | 778,782 | 737,957 | 778,782 |
2 BNY
Consolidated Financial Highlights (unaudited) (continued)
| Regulatory capital and other ratios | June 30, 2024 | March 31, 2024 | Dec. 31, 2023 |
|---|---|---|---|
| Average liquidity coverage ratio (“LCR”) | 115% | 117% | 117% |
| Average net stable funding ratio (“NSFR”) | 132% | 136% | 135% |
| Regulatory capital ratios: (g) | |||
| Advanced Approaches: | |||
| Common Equity Tier 1 (“CET1”) ratio | 11.5% | 11.1% | 11.5% |
| Tier 1 capital ratio | 14.2 | 13.7 | 14.2 |
| Total capital ratio | 15.0 | 14.5 | 14.9 |
| Standardized Approach: | |||
| CET1 ratio | 11.4% | 10.8% | 11.9% |
| Tier 1 capital ratio | 14.0 | 13.4 | 14.6 |
| Total capital ratio | 15.0 | 14.3 | 15.6 |
| Tier 1 leverage ratio | 5.8% | 5.9% | 6.0% |
| Supplementary leverage ratio (“SLR”) | 6.8 | 7.0 | 7.3 |
| BNY shareholders’ equity to total assets ratio | 9.5% | 9.3% | 9.9% |
| BNY common shareholders’ equity to total assets ratio | 8.5 | 8.3 | 8.9 |
(a) Results for the quarter ended June 30, 2023 and the six months ended June 30, 2023 were restated to reflect the retrospective application of adopting new accounting guidance related to our investments in renewable energy projects using the proportional amortization method (ASU 2023-02). See Note 2 of the Notes to Consolidated Financial Statements for additional information.
(b) Return on tangible common equity and tangible book value per common share, Non-GAAP measures, exclude goodwill and intangible assets, net of deferred tax liabilities. See “Supplemental information – Explanation of GAAP and Non-GAAP financial measures” beginning on page 43 for the reconciliation of Non-GAAP measures.
(c) See “Net interest income” on page 9 for a reconciliation of this Non-GAAP measure.
(d) Consists of AUC/A primarily from the Asset Servicing line of business and, to a lesser extent, the Clearance and Collateral Management, Issuer Services, Pershing and Wealth Management lines of business. Includes the AUC/A of CIBC Mellon Global Securities Services Company (“CIBC Mellon”), a joint venture with the Canadian Imperial Bank of Commerce, of $1.7 trillion at June 30, 2024 and March 31, 2024 and $1.6 trillion at June 30, 2023.
(e) Represents assets managed in the Investment and Wealth Management business segment.
(f) Beginning March 31, 2024, the number of full-time employees excludes interns.
(g) For our CET1, Tier 1 capital and Total capital ratios, our effective capital ratios under U.S. capital rules are the lower of the ratios as calculated under the Standardized and Advanced Approaches. For additional information on our capital ratios, see “Capital” beginning on page 36.
BNY 3
Part I – Financial Information
Items 2. and 3. Management’s Discussion and Analysis of Financial Condition and Results of Operations; Quantitative and Qualitative Disclosures about Market Risk
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