The Bank Of New York Mellon Corporation · NYSE:BNY
The Bank Of New York Mellon — Bank of New York Mellon — Q3 2019 Earnings Presentation
16 slides from The Bank Of New York Mellon's earnings presentation, Oct 16, 2019
Slide 1: Third Quarter 2019 Financial Highlights
Third Quarter 2019 Financial Highlights October 16, 2019
Slide 2: 3Q19 Financial Results
3Q19 Financial Results Profits Returns Balance Sheet (a) › Net Income: $1,002 million › ROE: 10.6% › CET1: 11.1% (b) › Diluted EPS: $1.07 › ROTCE: 21.4% › SLR: 6.1% › Returned $1.3 billion to shareholders Pre-tax Income Total Revenue ($ million) ($ million) (4%) - % 3,057 › Lower revenues mainly due
Slide 3: 3Q19 Financial Highlights
3Q19 Financial Highlights ($ millions, except per share data) 3Q19 2Q19 3Q18 Total revenue $3,861 (2)% (5)% Fee revenue 3,129 1 (1) Net interest revenue 730 (9) (18) Provision for credit losses (16) N/M N/M Noninterest expense 2,590 (2) (5) Income before income taxes 1,287 - (4) Net income applicabl
Slide 4: Capital and Liquidity
Capital and Liquidity 3Q19 2Q19 3Q18 Consolidated regulatory capital ratios: (a) Common Equity Tier 1 (“CET1”) ratio 11.1% 11.1% 11.2% Tier 1 capital ratio 13.2 13.2 13.3 Total capital ratio 14.0 14.0 14.1 Tier 1 leverage ratio 6.6 6.8 7.0 Supplementary leverage ratio (“SLR”) 6.1 6.3 6.4 Average liq
Slide 5: Balance Sheet
Balance Sheet ($ billions unless otherwise noted) Average Interest-Earning Assets Average Deposits › Higher deposit balances +5% – higher interest-bearing deposits partially offset +2% by lower noninterest-bearing deposit balances +8% 294 287 +3% › High quality and liquid securities portfolio 279 51
Slide 6: Net Interest Revenue
Yield Curve Net Interest Revenue 7/17/19 10/11/19 2.5% 2.0% 1.5% 1.0% 1m 3m 12m 2Y 5Y 10Y Drivers of Sequential NIR Change ($ millions) USD LIBOR US Treasury 802 800 730 (70) 2Q19 − Average NIB + Average IB + Lower − Lower interest- 3Q19 − Lease-related 3Q19 deposit deposit funding earning asset exc
Slide 7: Noninterest Expense
Noninterest Expense ($ millions) 3Q19 2Q19 3Q18 › Noninterest expense down 5% year-over-year Staff $1,479 4% - % – mostly due to reduction of previously Professional, legal and other purchased 316 (6) (5) established reserves for potential tax-related services exposure of certain investment manageme
Slide 8: Investment Services Financial Highlights
Investment Services Financial Highlights ($ millions unless otherwise noted) 3Q19 2Q19 3Q18 › Asset Servicing down 4% year-over-year on lower client Total revenue by line of business: activity, securities lending revenue and net interest Asset Servicing $1,405 1% (4)% Pershing 568 1 2 revenue and th
Slide 9: Investment Services - Revenue Drivers
Investment Services - Revenue Drivers ($ millions) (4)% +2% +3% (4)% +11% 1,458 1,405 558 568 453 466 324 312 293 264 3Q18 3Q19 3Q18 3Q19 3Q18 3Q19 3Q18 3Q19 3Q18 3Q19 Asset Servicing Pershing Issuer Services Treasury Services Clearance and Collateral + AUC/A + Higher client assets + Depositary rece
Slide 10: Investment Management Financial Highlights
Investment Management Financial Highlights ($ millions unless otherwise noted) 3Q19 2Q19 3Q18 › Asset Management down 14% year-over-year on Total revenue by line of business: Asset Management $605 (2)% (14)% cumulative AUM outflows since 3Q18, lower Wealth Management 285 (5) (8) performance fees, th
Slide 11: Other Segment
Other Segment ($($ millions) millions) 3Q19 2Q19 3Q18 › Fee revenue, net securities (losses) gains and net $5 $34 $7 Fee revenue interest expense include corporate treasury and Net securities (losses) gains (1) 7 - other investment activity, including hedging activity Total fee and other revenue 4 4
Slide 12: Appendix
wy S_ BNY MELLON Appendix
Slide 13: Footnotes
Footnotes 3Q19 Financial Results - Page 2 (a) Reflects net income applicable to common shareholders. (b) Quarterly returns are annualized. See page 14 for a reconciliation of this non-GAAP measure. 3Q19 Financial Highlights - Page 3 (a) Operating leverage is the rate of increase (decrease) in total
Slide 14: Return on Common Equity and Tangible Common Equity Reconciliation
Return on Common Equity and Tangible Common Equity Reconciliation ($ millions) 3Q19 2Q19 3Q18 Net income applicable to common shareholders of The Bank of New York Mellon Corporation – GAAP $1,002 $969 $1,075 Add: Amortization of intangible assets 30 30 48 Less: Tax impact of amortization of intangib
Slide 15: Pre-tax Operating Margin Reconciliation - Investment Management Business
Pre-tax Operating Margin Reconciliation - Investment Management Business ($ millions) 3Q19 2Q19 3Q18 Income before income taxes – GAAP $300 $265 $316 Total revenue – GAAP $890 $917 $1,015 Less: Distribution and servicing expense 98 94 99 Adjusted total revenue, net of distribution and servicing expe
Slide 16: Cautionary Statement
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,” “likely,” “target,” “expect,” “intend,” “continue,” “seek,” “believe,” “plan,
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