Bank of New York Mellon said net income attributable to shareholders for the quarter ending March 31, 2012 was $619 million, or $0.52 per common share, compared with $625 million, or $0.50 per common share, in the first quarter of 2011 and $505 million, or $0.42 per common share, in the fourth quarter of 2011.
The custodian bank reported assets under custody and administration of $26.6 trillion at March 31, 2012, an increase of 4% compared with the prior year and 3% on the quarter ending Dec. 31 2012. The increases were driven by net new business and higher market values. Assets under management, excluding securities lending assets, amounted to a record $1.3 trillion at March 31, 2012. This represents an increase of 6% compared with the prior year and 4% sequentially. BNY Mellon attributed the year-over-year increase to net new business and higher market values. On a sequential basis, the increase resulted from higher market values.
“We enjoyed solid sequential growth in investment management and services fees, as we benefited from new business wins and improved equity values, said Gerald Hassell, chairman, president and chief executive officer of BNY Mellon. We are seeing the early results of our operational excellence initiatives as we generated significant positive operating leverage relative to the fourth quarter.
Investment services fees totaled $1.6 billion, a decrease of 4% year-over-year and an increase of 3% sequentially. The year-over-year decrease was primarily driven by the impact of the sale of the Shareowner Services business to Computershare in the fourth quarter of 2011, partially offset by higher asset servicing and Clearing services fees. Asset servicing fees were $943 million at March 31, 2012, compared to $885 million at Dec. 31, 20121 and $917 million at March 31, 2011. Clearing services fees were $303 million at March 31, 2012, compared to $278 million at Dec. 31 2011 and $292 million at March 31, 2011.
Sequentially, the increase resulted from improved market values, higher volumes and net new business, partially offset by the impact of the sale of the Shareowner Services business, said BNY Mellon.
Investment management and performance fees were $745 million, a decrease of 2% year-over-year and an increase of 2% sequentially. BNY Mellon said the year-over-year decrease was driven by higher money market fee waivers, partially offset by net new business. Sequentially, the increase primarily resulted from higher market values, lower money market fee waivers and net new business, partially offset by seasonally lower performance fees.
Foreign exchange and other trading revenue totaled $191 million compared with $198 million in the first quarter of 2011 and $228 million in the fourth quarter of 2011. In the first quarter of 2012, foreign exchange revenue totaled $136 million, a decrease of 21% year-over-year and 26% sequentially. The year-over-year decrease reflects lower volumes and volatility, while sequentially, volumes were unchanged and volatility decreased 20%. Other trading revenue was $55 million in the first quarter of 2012 compared with $25 million in the first quarter of 2011 and $45 million in the fourth quarter of 2011. Both increases were primarily driven by higher fixed income trading.
The provision for credit losses was $5 million in the first quarter of 2012 compared with $23 million in the fourth quarter of 2011 and no provision in the first quarter of 2011.
(JDC)