Bank of New York (BNY) Mellon reported a total revenue increase of 22% year on year during the third quarter, beating expectations after recording strong performance in its investment services and investment management business.
Its investment services division, which includes its global custody, broker-dealer and global collateral services, increased 5% year-over-year to $1.8 billion. Asset servicing fees were $998 million in the quarter, $59 million more than the same quarter last year, after achieving “net new businesses and higher collateral management fees in global collateral services,” the bank states.
“We grew Investment Management and Investment Services fees, controlled expenses and executed on our capital plan. We achieved this despite a challenging environment, demonstrating the resilience of our business model,” says Gerald Hassell, chairman and CEO, BNY Mellon.
Within these fees, revenue from clearing services fees were $336 million, an increase of 7%, driven by growth in clearing accounts and mutual fund positions, and higher asset levels. Moreover securities lending revenue increased by $2 million to $37 million.
“With the OTC market being more collateralized and segregated… being a custodian has been one of the underlining drivers to the growth we’ve seen over the past year ,” Hassell adds.
Total assets under custody increased 3% to $28.3 trillion, while total assets under management also rose 7% to $1.65 trillion. The bank attributed this grow to “higher equity market values and new net businesses.”
Meanwhile assets under management were a record £1.65 trillion as of the end of September, an increase of 7%.
Furthermore it recorded a 1% reduction in total employee costs as a result of a decline in employee benefits and compensation.
However revenue from foreign exchange and derivatives trading declined 4% to $153 million as low global volatility hit volumes.
Earlier this week, JPMorgan released its third quarter results in which assets under custody grew 8% to $21.2 trillion.
Other global custodians such as State Street and Northern Trust did not publish their results at the time of print.
BNY Mellon Sees Bright Third Quarter, Beating Expectations
Bank of New York (BNY) Mellon reported a total revenue increase of 22% year on year during the third quarter, beating expectations after recording strong performance in its investment services and investment management business.