BNY Mellon reports YoY increase in asset servicing revenue
15 July 2020 New York
Image: RA2 Studio/Shutterstock
BNY Mellon revealed a year-over-year increase in asset servicing revenue totalling $1.5 billion, according to its Q2 2020 earnings results.
In the Q2 results, BNY Mellon explained that while partially offset by lower net interest revenue, the increase is a result of higher foreign exchange and other trading revenues.
The results also showed an increase of 5 percent in assets under custody and/or administration to $37.3 trillion for Q2.
Assets under management increased by 6 percent to $2 trillion, which BNY Mellon said is a reflection of higher client inflows, market values and net new business. These figures were also partially offset by the impact of a stronger USD and money market fee waivers.
Issuer services saw a year-over-year decrease of $15 million following lower depository receipts and corporate trust fees.
BNY Mellon also reported a 7 percent increase in treasury services compared to Q2 figures in 2019, as well as an increase of almost 4 percent in clearance and collateral management, both of which are attributed to higher net interest revenue.
Clearance and collateral management resulted in a year-over-year increase, totalling $0.2 billion, which the bank said primarily reflects higher net interest revenue and growth in collateral management and clearance volumes, mostly from non-US clients.
BNY Mellon noted that the sequential decrease primarily reflects lower collateral management fees.
Todd Gibbons, CEO of BNY Mellon, commented: “We are seeing momentum across most of our businesses as we continue to drive improved performance and capabilities across the company, and as we benefit from higher volumes and volatility versus one year ago.”
“As we look ahead to the remainder of 2020, downside risks remain from the economic uncertainty and the significant pressure from low interest rates. Despite this, our underlying business remains strong, benefitting from the improving quality and efficiency of our operations and the level of the client experience.”
Gibbons continued: “I would be remiss if I didn’t reflect on the first half of 2020—a period when we have been faced with the gravity of a global pandemic and with societal unrest spurred by racial injustice. Both have significant implications for how we operate as a business and as a corporate citizen. We have a relentless ambition to have a more profound impact on the world around us, helping us deliver sustainable long-term value to our shareholders.”
In the Q2 results, BNY Mellon explained that while partially offset by lower net interest revenue, the increase is a result of higher foreign exchange and other trading revenues.
The results also showed an increase of 5 percent in assets under custody and/or administration to $37.3 trillion for Q2.
Assets under management increased by 6 percent to $2 trillion, which BNY Mellon said is a reflection of higher client inflows, market values and net new business. These figures were also partially offset by the impact of a stronger USD and money market fee waivers.
Issuer services saw a year-over-year decrease of $15 million following lower depository receipts and corporate trust fees.
BNY Mellon also reported a 7 percent increase in treasury services compared to Q2 figures in 2019, as well as an increase of almost 4 percent in clearance and collateral management, both of which are attributed to higher net interest revenue.
Clearance and collateral management resulted in a year-over-year increase, totalling $0.2 billion, which the bank said primarily reflects higher net interest revenue and growth in collateral management and clearance volumes, mostly from non-US clients.
BNY Mellon noted that the sequential decrease primarily reflects lower collateral management fees.
Todd Gibbons, CEO of BNY Mellon, commented: “We are seeing momentum across most of our businesses as we continue to drive improved performance and capabilities across the company, and as we benefit from higher volumes and volatility versus one year ago.”
“As we look ahead to the remainder of 2020, downside risks remain from the economic uncertainty and the significant pressure from low interest rates. Despite this, our underlying business remains strong, benefitting from the improving quality and efficiency of our operations and the level of the client experience.”
Gibbons continued: “I would be remiss if I didn’t reflect on the first half of 2020—a period when we have been faced with the gravity of a global pandemic and with societal unrest spurred by racial injustice. Both have significant implications for how we operate as a business and as a corporate citizen. We have a relentless ambition to have a more profound impact on the world around us, helping us deliver sustainable long-term value to our shareholders.”
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