The Bank Of New York Mellon Corporation · NYSE:BNY
The Bank Of New York Mellon — Q3 2022 Earnings Presentation
18 slides from The Bank Of New York Mellon's earnings presentation, Oct 17, 2022
Slide 1: 3Q22 Financial Highlights
3Q22 Financial Highlights OCTOBER 17, 2022
Slide 2: 3Q22 Financial Highlights
3Q22 Financial Highlights Revenue EPS • Revenue up 6% YoY, up 5%(a) excluding the impact of notable Excluding Excluding Reported Reported notable items notable items items (a) (a) $ 4,279mm $ 4,242mm $ 0.39 $ 1.21 – Fee revenue down 1% YoY – Net interest revenue up 44% YoY Pre-tax income Pre-tax mar
Slide 3: 3Q22 Financial Results
3Q22 Financial Results 3Q22 vs. $mm, except per share data or unless otherwise noted 3Q22 2Q22 3Q21 2Q22 3Q21 Fee revenue $3,236 $3,339 $3,265 (3)% (1)% Investment and other revenue 117 91 129 N/M N/M Net interest revenue 926 824 641 12% 44% Total revenue $4,279 $4,254 $4,035 1% 6% Down 1%(c) Up 4%(
Slide 4: Capital and Liquidity
Capital and Liquidity 3Q22 2Q22 3Q21 Consolidated regulatory capital ratios:(a) Tier 1 leverage ratio 5.4% 5.2% 5.7% Supplementary leverage ratio ("SLR") 6.3 6.2 7.0 Common Equity Tier 1 ratio – Advanced Approaches 10.1 10.0 11.8 Common Equity Tier 1 ratio – Standardized Approach 10.0 10.1 11.7 Cons
Slide 5: Net Interest Revenue and Balance Sheet Trends
Net Interest Revenue and Balance Sheet Trends Net Interest Revenue 3Q22 vs. ($mm) $bn, avg. 3Q22 2Q22 3Q21 +44% Deposits: +12% Noninterest-bearing $85 (8)% (1)% 926 Interest-bearing 204 (7)% (13)% 824 Total deposits $288 (7)% (10)% 641 Interest-earning assets: Cash and reverse repo 131 (10)% (17)% L
Slide 6: Noninterest Expense
Noninterest Expense 3Q22 vs. $mm, unless otherwise noted 3Q22 2Q22 3Q21 • Noninterest expense up 26% YoY, primarily reflecting goodwill Staff $1,673 3% 6% impairment in the Investment Management reporting unit Software and equipment 421 4% 13% Professional, legal and other purchased services 363 (4)
Slide 7: Securities Services
Securities Services 3Q22 vs. $mm, unless otherwise noted 3Q22 2Q22 3Q21 • Total revenue of $2,074mm up 13% YoY Total revenue by line of business: – Asset Servicing up 11%% YoY, primarily reflecting higher net interest Asset Servicing $1,596 4% 11% revenue and lower money market fee waivers, partiall
Slide 8: Market and Wealth Services
Market and Wealth Services 3Q22 vs. $mm, unless otherwise noted 3Q22 2Q22 3Q21 • Total revenue of $1,367mm up 17% YoY Total revenue by line of business: – Pershing up 16% YoY, primarily reflecting lower money market fee Pershing $658 3% 16% waivers and higher client activity, partially offset by the
Slide 9: Investment and Wealth Management
Investment and Wealth Management 3Q22 vs. $mm, unless otherwise noted 3Q22 2Q22 3Q21 • Total revenue of $862mm down 16% YoY Total revenue by line of business: – Investment Management down 20% YoY, primarily reflecting lower Investment Management $579 (4)% (20)% market values, the unfavorable impact
Slide 10: Other Segment
Other Segment $mm, unless otherwise noted 3Q22 2Q22 3Q21 • Total revenue includes corporate treasury and other investment activity, Fee revenue $28 $13 $12 including hedging activity which has an offsetting impact between fee and Investment and other revenue (5) 62 23 other revenue and net interest
Slide 11: Appendix
Appendix Sm BNY MELLON Consider Everything
Slide 12: Footnotes
Footnotes Page 3 – 3Q22 Financial Results (a) Operating leverage is the rate of increase (decrease) in total revenue less the rate of increase (decrease) in total noninterest expense. Page 4 – Capital and Liquidity (a) Regulatory capital ratios for September 30, 2022 are preliminary. For our CET1, T
Slide 13: Money Market Fee Waivers Impact
Money Market Fee Waivers Impact 3Q22 2Q22 1Q22 4Q21 3Q21 Investment services fees (see table below) $(1) $(26) $(126) $(148) $(142) Investment management and performance fees (21) (40) (85) (116) (109) Distribution and servicing fees — (2) (11) (14) (11) Total fee revenue (22) (68) (222) (278) (262)
Slide 14: Reconciliation of Non-GAAP Measures – Impact of Notable Items
Reconciliation of Non-GAAP measures – Impact of Notable Items 3Q22 vs. 3Q22 2Q22 3Q21 2Q22 3Q21 Total Revenue — GAAP $ 4,279 $ 4,254 $ 4,035 1% 6% Notable items(a) 37 — 9 Total revenue, ex-notables — Non-GAAP $ 4,242 $ 4,254 $ 4,026 —% 5% Noninterest expense — GAAP $ 3,679 $ 3,112 $ 2,918 18 % 26 %
Slide 15: Return on Common Equity and Tangible Common Equity Reconciliation – Impact of Notable Items
Return on Common Equity and Tangible Common Equity Reconciliation – Impact of Notable Items 3Q22 Non-GAAP Results Notable items(a) ex. notable items Net income applicable to common shareholders of The Bank of New York Mellon Corporation — GAAP $319 $ (664) $983 Add: Amortization of intangible assets
Slide 16: Pre-tax Operating Margin Reconciliation – Investment and Wealth Management
Pre-tax Operating Margin Reconciliation – Investment and Wealth Management Business 3Q22 2Q22 3Q21 Income before income taxes — GAAP $(497) $208 $348 Total revenue — GAAP $862 $899 $1,032 Less: Distribution and servicing expense 88 91 76 Adjusted total revenue, net of distribution and servicing expe
Slide 17: Return on Common Equity and Tangible Common Equity Reconciliation
Return on Common Equity and Tangible Common Equity Reconciliation 3Q22 2Q22 3Q21 Net income applicable to common shareholders of The Bank of New York Mellon Corporation — GAAP $319 $835 $881 Add: Amortization of intangible assets 17 17 19 Less: Tax impact of amortization of intangible assets 4 4 4 A
Slide 18: Cautionary Statement
Cautionary Statement A number of statements in The Bank of New York Mellon Corporation’s (the “Corporation”) presentations, the accompanying slides and the responses to your questions are “forward-looking statements.” Words such as “estimate,” “forecast,” “project,” “anticipate,” “likely,” “target,”
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