BNY Mellon asset servicing revenues dropped to $885 million in the fourth quarter of 2011 compared to $908 million in the same quarter in 2010.
Foreign exchange revenue sank by 11% year-over-year to $183 million in the fourth quarter of 2011, declining 17% from the quarter before. The firm says the decreases were due to lower volumes.
Part of the reason for lower volumes is likely attributable to the loss of some FX business due to accusations that the custodian overcharged its customers on FX transactions. In the latest example made public, MassPRIM is said to have moved some of its FX transactions from BNY Mellon to Russell. BNY Mellon is fielding a lawsuit by the Massachusetts attorney general on behalf of MassPRIM, which claims the custodian overcharged it on FX transactions.
Revenue at BNY Mellon overall for the quarter was $505 million, down from $679 million in the fourth quarter of 2010.
It was a challenging revenue quarter, as general uncertainty in the financial markets resulted in lower-than-normal levels of client activity, says Gerald L. Hassell, who became chairman, president and CEO of BNY Mellon when Robert Kelly stepped down from the positions earlier this year. Hassell was a long-time executive of the company.
BNY Mellon says it saw a seasonal decline in its Depositary Receipts business, although it did not release specific figures related to the business.
(CG)