The Bank Of New York Mellon Corporation · NYSE:BNY
The Bank Of New York Mellon — Bank of New York Mellon — Q1 2016 Earnings Presentation
23 slides from The Bank Of New York Mellon's earnings presentation, Apr 21, 2016
Slide 1: BNY Mellon First Quarter 2016 Financial Highlights
BNY Mellon First Quarter 2016 Financial Highlights April 21, 2016
Slide 2: Cautionary Statement
2 First Quarter 2016 – Financial Highlights Cautionary Statement A number of statements in our presentations, the accompanying slides and the responses to your questions are “forward-looking statements.” Words such as “estimate”, “forecast”, “project”, “anticipate”, “target”, “expect”, “intend”, “co
Slide 3: First Quarter Financial Highlights
3 First Quarter 2016 – Financial Highlights First Quarter Financial Highlights • Earnings per common share of $0.73, including: • $0.01 per common share for litigation and restructuring charges • Earnings per common share +10% on an adjusted basis1 • Generated approximately 250 bps of positive opera
Slide 4: First Quarter 2016 Key Messages
4 First Quarter 2016 – Financial Highlights First Quarter 2016 Key Messages • Executing on our strategic priorities; delivering on our three-year financial goals set at our 2014 Investor Day • Focused on enhancing the client experience and driving profitable revenue growth ◦ Broadening existing clie
Slide 5: First Quarter 2016 Key Performance Drivers
5 First Quarter 2016 – Financial Highlights First Quarter 2016 Key Performance Drivers • Earnings per common share of $0.74, +10% on an adjusted basis1, driven by higher money market fees, growth in net interest revenue related to higher yields, securities lending and continued execution of our Busi
Slide 6: Summary Financial Results for First Quarter 2016
6 First Quarter 2016 – Financial Highlights Summary Financial Results for First Quarter 2016 Growth vs. $ in millions, except per share data 1Q16 4Q15 1Q15 4Q15 1Q15 Revenue $ 3,730 $ 3,726 $ 3,792 — % (2)% Expenses $ 2,629 $ 2,692 $ 2,700 (2)% (3)% Income before income taxes $ 1,091 $ 871 $ 1,090 2
Slide 7: Summary Financial Results for First Quarter 2016 (Non-GAAP)
7 First Quarter 2016 – Financial Highlights Summary Financial Results for First Quarter 2016 (Non-GAAP)1 Growth vs. $ in millions, except per share data 1Q16 4Q15 1Q15 4Q15 1Q15 Revenue $ 3,737 $ 3,721 $ 3,761 —% (1)% Expenses $ 2,555 $ 2,610 $ 2,637 (2)% (3)% Operating leverage2 254 bps 247 bps Inc
Slide 8: Fee and Other Revenue (Consolidated)
8 First Quarter 2016 – Financial Highlights Fee and Other Revenue (Consolidated) Growth vs. Year-over-Year Drivers ($ in millions) 1Q16 4Q15 1Q15 Investment services fees: Asset ServicingŸ Net new business and higher securities lending revenue, offset by lower market values and the unfavorable impac
Slide 9: Investment Management Metrics
9 First Quarter 2016 – Financial Highlights Investment Management Metrics Change in Assets Under Management (AUM)1 Growth vs. $ in billions 1Q16 LTM 1Q16 4Q15 1Q15 Beginning balance of AUM $1,625 $1,717 Net inflows (outflows): Long-Term: Equity (3) (29) Fixed income — (4) Liability-driven investment
Slide 10: Investment Services Metrics
10 First Quarter 2016 – Financial Highlights Investment Services Metrics Growth vs. 1Q16 4Q15 1Q15 Assets under custody and/or administration at period end (trillions)1,2 $ 29.1 1 % 2 % Estimated new business wins (AUC/A) (billions)2 $ 40 Market value of securities on loan at period end (billions)3
Slide 11: Net Interest Revenue
11 First Quarter 2016 – Financial Highlights Net Interest Revenue Growth vs. Year-over-Year Drivers ($ in millions) 1Q16 4Q15 1Q15 Net interest revenue (non-FTE) $ 766 1 % 5% Net Interest Revenue ŸHigher yields on interest-earning assets, +9 bps, partially offset by higher rates paid on interest- be
Slide 12: Noninterest Expense
12 First Quarter 2016 – Financial Highlights Noninterest Expense Growth vs. Year-over-Year Drivers ($ in millions) 1Q16 4Q15 1Q15 Staff $ 1,459 (1)% (2)% Ÿ Lower expenses in nearly all categories, primarily driven by the favorable impact of a stronger U.S. dollar, lower staff and legal expenses and
Slide 13: Capital Ratios Highlights
13 First Quarter 2016 – Financial Highlights Capital Ratios Highlights 3/31/16 12/31/15 Consolidated regulatory capital ratios:1,2 Ÿ Repurchased 16.2 million common shares for $577 million in 1Q16 Ÿ In 1Q16, declared a quarterly dividend of $0.17 per common share Ÿ Compliant with fully phased-in U.S
Slide 14: Capital Ratio Footnotes
14 First Quarter 2016 – Financial Highlights Capital Ratio Footnotes 1 March 31, 2016 regulatory capital ratios are preliminary. See the “Capital Ratios” section in the earnings release for additional detail. 2 At March 31, 2016 and Dec. 31, 2015, the CET1, Tier 1 and Total risk-based consolidated r
Slide 15: Appendix
APPENDIX
Slide 16: Investment Management
16 First Quarter 2016 – Financial Highlights Investment Management . Growth vs. ($ in millions) 1Q16 4Q15 1Q15 Investment management and performance fees $ 797 (7)% (5)% Distribution and servicing 46 18 21 Other1 (31) N/M N/M Net interest revenue 83 (1) 11 Total Revenue $ 895 (10)% (10)% Noninterest
Slide 17: Investment Services
17 First Quarter 2016 – Financial Highlights Investment Services Growth vs. ($ in millions) 1Q16 4Q15 1Q15 Investment services fees: Asset servicing $ 1,016 1% — % Clearing services 348 3 2 Issuer services 244 23 6 Treasury services 129 (4) (4) Total investment services fees $ 1,737 3 1 Foreign exch
Slide 18: Expense & Pre-Tax Operating Margin - Non-GAAP Reconciliation
18 First Quarter 2016 – Financial Highlights Expense & Pre-Tax Operating Margin - Non-GAAP Reconciliation 1Q16 4Q15 1Q15 QoQ Operating Leverage YoY Operating Leverage($ in millions) Total revenue – GAAP $ 3,730 $ 3,726 $ 3,792 Less: Net income (loss) attributable to noncontrolling interests of conso
Slide 19: Return on Tangible Common Equity Reconciliation
19 First Quarter 2016 – Financial Highlights Return on Tangible Common Equity Reconciliation 1Q16 4Q15 1Q15 ($ in millions) Net income applicable to common shareholders of The Bank of New York Mellon Corporation – GAAP $ 804 $ 637 $ 766 Add: Amortization of intangible assets, net of tax 37 42 43 Net
Slide 20: GAAP Revenue and Non-GAAP Earnings Per Share Reconciliation
20 First Quarter 2016 – Financial Highlights GAAP Revenue and Non-GAAP Earnings Per Share Reconciliation Revenue - GAAP ($ in millions) 1Q16 4Q15 1Q15 Investment services fees: Asset servicing1 $ 1,040 $ 1,032 $ 1,038 Clearing services 350 339 344 Issuer services 244 199 232 Treasury services 131 13
Slide 21: Estimated Fully Phased-In SLR - Non-GAAP Reconciliation
21 First Quarter 2016 – Financial Highlights Estimated Fully Phased-In SLR1 - Non-GAAP Reconciliation ($ in millions) 3/31/162 12/31/15 Total estimated fully phased-in Basel III CET1 - Non-GAAP $ 16,603 $ 16,082 Additional Tier 1 capital 2,544 2,530 Total Tier 1 capital $ 19,147 $ 18,612 Total lever
Slide 22: Pre-Tax Operating Margin – Investment Management Reconciliation
22 First Quarter 2016 – Financial Highlights Pre-Tax Operating Margin – Investment Management Reconciliation 1Q16 4Q15 1Q15 ($ in millions) Income before income taxes – GAAP $ 217 $ 290 $ 263 Add: Amortization of intangible assets 19 24 24 Provision for credit losses (1) (4) (1) Money market fee wai
Slide 23: Investment Management and Performance Fees - Non-GAAP
23 First Quarter 2016 – Financial Highlights Investment Management and Performance Fees - Non-GAAP Investment management fees - Investment Management business Growth vs. ($ in millions) 1Q16 1Q15 1Q15 Investment management fees - GAAP $ 786 $ 825 (5)% Impact of changes in foreign currency exchange r
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