BNY Mellon delivers on $1.1 billion in earnings

The world’s largest custodian recorded revenues of $4.2 billion in the quarter, up by 9% year-on-year.

By Joe Parsons

BNY Mellon has reported earnings of over $1.1 billion in the first quarter of 2018, representing a 33% annual increase, with its chief executive emphasising “organic growth” as a focus going forward.

The world’s largest custodian recorded revenues of $4.2 billion in the quarter, up by 9% year-on-year, due to increases in its stock price and favourable interest rates.

Meanwhile assets under custody and administration grew 9% over the year to $33.5 trillion, with asset servicing revenues increasing by 13% to $1.5 billion.

The positive results provide relief to BNY Mellon’s chief executive, Charles Scharf, who was forced to field tough questions on its organic growth.

“Strong equity markets and higher interest rates were important drivers and, while we should remain beneficiaries of strong and growing markets over the long term, we are focused on continuing to increase our organic revenue growth,” stated BNY Mellon’s Scharf.

“Importantly, we saw franchise growth in several parts of the company, including foreign exchange trading, tri-party repo activity, collateral management, securities lending and liquidity services.”

Last week, JP Morgan and Citi both reported positive results for their securities services business with revenues of $1.1 billion and $641 million respectively, both up 16% on the year.

State Street and Northern Trust are yet to publish their first quarter results.