• Earnings Per Share (EPS): $1.58, up 26% year over year on a reported basis and up 22% excluding notable items.
• Total Revenue: $4.8 billion, up 6% year over year.
• Expenses: $3.3 billion, up 2% year over year.
• Pre-Tax Margin: 32%.
• Return on Tangible Common Equity: 24%.
• Net Interest Income: $1.2 billion, up 11% year over year.
• Fee Revenue: Up 3% year over year.
• Assets Under Custody and Administration (AUCA): $53.1 trillion, up 9% year over year.
• Assets Under Management (AUM): $2 trillion, flat year over year.
• Provision for Credit Losses: $18 million.
• Tier 1 Leverage Ratio: 6.2%.
• Common Equity Tier 1 (CET1) Ratio: 11.5%.
• Capital Returned to Shareholders: Approximately $1.1 billion, representing a 95% total payout ratio year to date.
• Liquidity Coverage Ratio: 116%.
• Net Stable Funding Ratio: 132%.
• Securities Services Revenue: $2.3 billion, up 8% year over year.
• Market and Wealth Services Revenue: $1.7 billion, up 11% year over year.
• Investment and Wealth Management Revenue: $779 million, down 8% year over year.

• Warning! GuruFocus has detected 5 Warning Signs with BEEM.

Release Date: April 11, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Bank of New York Mellon Corp (NYSE:BK) reported a solid financial performance with earnings per share of $1.58, up 26% year over year.
• Total revenue increased by 6% year over year to $4.8 billion, demonstrating strong growth.
• The company achieved positive operating leverage, with a pre-tax margin improvement to 32% and a return on tangible common equity of 24%.
• The transformation strategy into a more platforms-oriented company is showing progress, with over half of the company now operating under the new model.
• The company is leveraging AI to drive productivity gains and improve risk management, with over 40 AI solutions already deployed into production.

Negative Points

• Uncertainty in the operating environment due to geopolitical tensions and trade policy changes poses elevated risks in the near and medium term.
• Investment management and performance fees were down 5%, driven by the mix of AUM flows and certain rebate adjustments.
• Assets under management remained flat year over year at $2 trillion, with net outflows in certain strategies.
• The macroeconomic environment remains uncertain, impacting client confidence and potentially affecting future business decisions.
• The company's Investment and Wealth Management segment reported a decline in total revenue by 8% year over year, with pre-tax income down 41%.

Q & A Highlights

Q: How do you view the current deposit environment and its impact on net interest income (NII)? A: Dermot Mcdonogh, CFO, explained that Q1 deposits were in line with expectations, with some moderation from the seasonally strong Q4. Despite recent market volatility, there has been a slight increase in deposits, but not as significantly as during the regional bank crisis two years ago. The strength of BNY Mellon's balance sheet and liquidity is recognized, but a major flight to quality has not yet occurred.

Q: What is BNY Mellon's approach to potential M&A opportunities in the current environment? A: Robin Vince, CEO, stated that the company is always evaluating opportunities that align with their priorities, cultural fit, and financial returns. While maintaining discipline, BNY Mellon is open to acquisitions that could enhance their platform, as demonstrated by their recent acquisition of Archer.

Q: How is BNY Mellon leveraging AI and digital assets for future growth? A: Robin Vince highlighted the company's platform-based approach to AI, with over 80% of employees trained to use their AI platform, Eliza. BNY Mellon has deployed over 40 AI solutions, expecting productivity gains and improved risk management. Regarding digital assets, BNY Mellon is engaged with regulators and clients, viewing stablecoins and digital currencies as long-term opportunities to enhance transaction efficiency.

Q: Can you discuss the impact of the platforms operating model on BNY Mellon's efficiency and growth? A: Robin Vince noted that over half of BNY Mellon is now operating under the platforms model, which enhances agility and efficiency. While immediate benefits are seen, the full impact on growth and risk management is expected to materialize over the next few years. AI integration is anticipated to further enhance these benefits.

Q: What is the outlook for BNY Mellon's net interest income (NII) and deposit mix? A: Dermot Mcdonogh reaffirmed the guidance for mid-single-digit NII growth for 2025, supported by actions taken last year to stabilize NII. The deposit mix is expected to remain stable, with non-interest-bearing deposits not anticipated to change significantly. The company is confident in its ability to manage NII under various scenarios.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.