The Bank of New York Mellon Corporation (BK) 17 Oct 222022 Q3 Earnings call transcript

Good morning, and welcome to the 2022 Third Quarter Earnings Conference Call hosted by BNY Mellon. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. Please note that this conference call and webcast will be recorded and will consist of copyrighted material.

You may not record or rebroadcast these materials without BNY Mellon’s consent. the Investor to Relations. turn Mellon's Merz, now of Head will call Marius over BNY I Please ahead. go

Thank you, operator. our third Good morning, everyone, XXXX call. and earnings quarter welcome to

through can our As our will website Robin earnings Emily remarks, and at the by introductory Relations financial Chief be joined our found and I'm will then Vince, highlights page always, make of on reference take Emily Portney, presentation, Robin we bnymellon.com. Executive Investor the and you which presentation. will President Officer;

Following remarks, will a be their there prepared Q&A session.

the that begin, please and website. our remarks we in and all financial Before Investor statements are financial on non-GAAP measures Information note the Relations statements our these page and include release, press presentation, supplement about of forward-looking earnings available measures. highlights non-GAAP available

on this With be not speak to Robin. call and of turn over only updated. XXXX, XX, today, it statements Forward-looking made October will that, will I as

excited franchise, employees financial past After with morning. our regulators, you, a Marius, taken tremendous for thank engaging for CEO of leaders, you, the to opportunity and and about over is markets everyone, our client I'm spending other ahead. Thank the great institution. few us this exceptional and chapter little central in a usher clients, it month Having honor as a ago, role formally new a over business this global a joining portion significant months, in lies that

this strategic take time brought are CEO particularly and and opportunity year helpfully new a current using and our look and at a naturally being as the plans I'm to together, priorities. close of Now environment it when budgets considering the debated

to number alike. while couple enhance me BNY opportunities performance shareholders apparent it's also our in good everything, there for Mellon's the last of reviewing still over areas and progress to clearly we've are clients that further of made years, I'm While a

and platforms, the and of I First, innovation our like and opportunities X, of custody discipline and to digital great real-time continue we on payments exciting examples that assets invest Pershing with reimagining need growth execute in see urgency. and collateral numerous to

just Second, reviewing not we're top line. the

and that in We examining do view should are also I'm be our the things cost questioning areas. we margins I'm and margins. of better our how some closely base

believe you For margin our example, to them we while very a model businesses XX% transformation have we the been deliver, more. to that be see to last clients opportunities providing talked we to our earnings also have term. determined do is improving going meaningful. to lot to security better more our solutions the whole deliver opportunity drive to holistic services for as through to firm More we third, the that looking I the pretax on this to One will potential a medium be on of believe about are in the touched unique more And is over call, we unified but I Mellon we continue broadly, collection efficiency placed and through. BNY operating

the coming in As we along providing with updates opportunities and you months, of progress to we way. through be out work all will bottom continue these regularly the

to detail. on financial financial Moving few I'll highlights a and with I'll run I our some it through turn in more the broader results perspectives to before quarter, over then to start Emily review

banks see persistently in countries, across markets high strengthening equity significant both aware, levels and by rapid developed central rate a are income high of expectations quarter, landscape. global fixed volatility dollar we and during for complex inflation, U.S. increases increased driving a you As geopolitical the to continue

plans, the their has FX the currency. the result as market. by example, stabilize display was including and gilt gilt the facility to the there U.K. aimed of their spending the of volatility a Bank of few to stepping manage QT Japan market some liquidity market the We program series to a to England, last in U.K. wherein in delaying actions particularly see plans. weeks, This also for began led this government a announcing And intervention, taxation a into purchase been government's on extraordinary and

as provider the Our touching on of so us business gives much financial model point going in a on markets. a terrific vantage core system, what's

a liquidity quarter building up And more more seen continues holders And was we've in to data not our short example, in euros few so than in extremely end, For be challenged into heading shows U.S. the to international seen markets selling some and that that throughout treasuries. broadly, market market clear the quite levels quarter years. it's others.

here most months fashion, normal than failed are and have fairly to and sit trades at and system are we a levels. today, function orderly few ago. feels settling risks are elevated clearly, fragile overdrafts But a it in continued the markets more was As relatively

While clients. the in and environment is quite by very demand our uncertain, of our innovation much platform trust is

interest pressures a should lower costs engaging with to of strengths. cost The them our platforms to their models. our for we enabling in clients focus operating of to are core seeing us their scale rise, lot As review operating allow us on

of impairment performance the Page on tangible and of will reported revenue equity and X%. Emily were impacted quarter that our referring We in more charge discuss presentation. results X EPS of goodwill on to a highlights detail $X.XX financial $X.X common in a by to of Turning our These billion return shortly.

Wealth as our rates across Services our continued performance balances and notable our was This to Market of the tangible EPS XX%. $X.XX, Securities business and strength X% XX% Services client impact model. and a in testament of return diversity interest year-over-year, segments. items, common resiliency and year-over-year, the Excluding equity on reflected well benefit was grew the higher and of Revenue volumes as up

few Investment While investment in and positive a on global net to performance the continued in our highlights. clients. investment deliver naturally Wealth continued business Management market business the the more affected Management, by inflows in in was values, particularly for Touching solid decline delivered quarter

delivering with to the manager, the technology and pipeline We and not is up integrated important broader the certain inflows from a line resilient see and private model asset mandates number a in have of European-based continued the asset tokenization of as results Asset custody assets. journey. front provide ETFs, unit we real we its total built U.S. deliver pleased beginning a a continue appointed digital net future with sales remains clear, scalable space live We're equity operating were invest currencies. demand see large to support blockchain And financial for in across revenue solid and space strong And the significant credit, estate. XXXX. fully But we to be and this AUCA for this meaningfully strong installed quarter, solid Investors, asset serviced global last that kinds us platform strong a for of much quarter. momentum the custodying office in digital not Aviva to from be we that just recently environment. just we announce did Servicing And all playing to part and markets almost these XXXX, to experience an includes top had this funds assets traditional subscription following streams yet platform. transaction fees, and wins as revenue than Pershing see well of also also the In as assets our now crypto. in an higher year. traction as income balance active To the beginning digital and with financial to custody alt for current from market-based scale momentum XX% back continue and of of mix foundational of only capabilities strong on to diverse services in an point, for seeing and focus powered well of of allows net the accommodate as our but finally, client benefiting office we capability fees, formation activities, of base fees interest both and fees infrastructure allowing no resilient, them our many purpose small are digital the our And exceptional the to see middle by institutional and in up

healthy, We an tools for with their X reached investment of plans a in uses equity a through the remains months new ahead. and advisers the Planning, the which strong the assets fintech, financial create in product and net on launch also well X's viable AI analytics help improve to minimum partnership their powerful Conquest flows clients. pipeline in customizable milestone efficiency another fourth Pershing highly boding to track quarter. gathered $XX and remains billion quarter, for and

clearance volumes strong client engagement, U.S. drive experience in to end-to-end Collateral us accelerate market Management that continues secondary treasuries. product for back volatility together exciting growth enhance of trading Our design the brings which delivery digital and is delivered input, U.S. an and higher helping of on the Clearance with to advisers. as the activity

of the In fact, volumes settlement XXXX. September, March highest in been were they've since

this asset Global payroll client in business, our momentum the the for wins growth and achieved doing saw and this client. also technologies. margin-related Treasury banker reflecting is Transaction corporate real-time number asset of to investment-grade margin that the Year. the derivatives Services leveraging recognized finance managing We're us digital to of our program a market. continue digital by awards We major XXXX with first emerging rules uncleared quarter comply financing transform them will clients new digital We in with also for were help be major team payment industry-leading were our services, chain trading. and and to awarded for Bank and work transfers we a solutions as optimize contract trade sponsored been major in named processing white-labeled supply awarded we for bank. the bring innovative have U.S. our to We a a by the to a payments trade proud work additional for Recognizing space

and to. become note us predict me economic from days. level here the the witnessing of these of about and of None that markets all conclude greater exact path of have with conditions in the Let a we're uncertainty than is the used markets uncertainty many humility can

our service this quarter. a performance our Emily role the and for more that recognize hand for significant review that, it positioning functioning our of stability the of of this world. environment in over to a I'll proud financial With we the deliver uninterrupted ourselves to is conservatively around As markets. the of important are We're in that clients and we detailed the global part strength and firm, capital of platform the

and morning, Thank you, Robin, everyone. good

will decreased XX%, minority trillion of unfavorable market a lower was unless $X.X impact of for gain quarter, by revenue X% market quarter. market trillion cumulative participating equity a and reflecting sale million all you fee will on on the And $XX third the Investment we our As a a of $XXX with values XX%. I and combined reporting our waivers higher partially and details reflecting interest other Market million of solutions. values impact through discount increased by unfavorable benefit Total Fee of up driven included lower rate. the will and the the robust investment values of by in custody basis This under Starting impact market from certainly our X. X%. down continue by lower Wealth the as increased segment management the revenue stronger tempered Services the were $X.X dollar, of Securities associated company, and to clients in subsidiary. markets benefit the million rates. This be and impairment I Services was and a The by billion goodwill in XX%, market account money by in of assets assets stake management by across and our impact U.S. from walk results was U.S. of of the net Reported organic $XXX lower a revenue interest by offset was existing the revenues lower quarter. managed otherwise. X% included their Through primarily year-over-year I specify inflows. comparisons HedgeMark units, the equity of suite Page and offset and fixed which on growth $XX.X and also headwinds values currency was growth new Net income across and Firm-wide stronger higher dollar. clients. our under decreased expenses continued administration growth

a not the common impacted and or having equity impairment charge liquidity for tangible firm's represented While ratios. this capital the earnings regulatory did our affect position, quarter, non-cash

of benefit commercial Excluding reflecting Provision portfolio. items, a well from up expenses $XX credit a balances notable to related our X%. estate and to for were cash exposure was Russia reserve primarily million, as modest real losses releases benefit as

$X.XX, was common XX.X% items. Reported was excluding rate return was tax or X%. effective notable tangible margin was pretax on EPS and Our XX.X%, XX%; equity

XX% common was items, and equity of margin XX%. return Excluding tangible was the was $X.XX, on notable pretax impact EPS

capital to Page Now X. on on and liquidity

resulted reflecting consolidated which lower a especially after And Our offset approximately leverage in the Tier portfolio quarter, quarter. earnings capital. tax up the the basis increase was sharp our X.X%, benefit stock loss of common last through million was XX available-for-sale interest by of partially rates, Tier sequentially, in in shareholders in weeks of on distributed ratio of securities our $XXX The points we X decrease X to assets, of $XXX approximately the unrealized average increase million during the an dividends.

capital impairment affect our I goodwill ratio. not As mentioned regulatory earlier, did the

LCR Our was five flat finally, CETX percentage XX%. XXX%, And ratio points up was sequentially our sequentially. at

trajectory $XXX portfolio assets, expressed typical rising deposit in Page X%. Net of higher of the through consistent was as balances deposit continue up U.S. increase trends sheet loan in quarter, one point expectation Average to contributed rates by about our higher previously dollar Turning previously Average this were net of balances with had and up by of that, sequential to rates down well X%; balances strengthening expense. better XX% continuously third the as percentage in assets deposit to also X, declines Underneath sequentially. amid we Overall, balances primarily approximately which The balances offset reflects cash the on funding our hold terms. balance partially is interest-earning largely reverse our interest X%. deposit this revenue revenue decreased remainder the securities I'll the for X%. non-interest-bearing decline. by talk balances decreased and while seasonal repo million decreased interest interest This year interest declined by than XX%; and expected. interest-earning on

basis. Expenses X. billion reported to Moving quarter Page were expenses on the on $X.X on for a

expense efficiency expenses as well X% expenses, of benefit reflects few investments the dollar. distribution revenue-related increase expenses Excluding offset the billion including the the higher and net of by variances. of and servicing in by market noteworthy were in driven expenses saves $X of waivers notable a up inflation, costs was base abatement A continued stronger to additional reflects year-over-year with Distribution X% as down of the items, entertainment year-over-year off prior This fee And lastly, details low expenses regarding Business year. expense expense expenses and funds. normalize last money up quarter-over-quarter year-over-year. to distribution other related as partially U.S. development higher associated increased change XX%, litigation higher impact travel year. the

a deposit interest X and Services Fee driven to billion, higher net offset prior of revenue business increased Page to increase Turning an up revenue look at XX% X% for our XX%, $X.X year. closer the by by compared total reported revenue by rates, segments. of partially lower interest Securities was balances.

were each services and than As Market segment, Securities fee fees client net comments as discuss Asset Services find business of investment and our my activity, from fees for services lower which on market you can In supplement. was of by performance the of dollar. in the Servicing, and financial new and focus labors, of growth offset X% the U.S. will line values our I impact Services I the and Wealth market high money more investment strengthening abating down business,

and receipts clients, lost Russian by continues Trust and an reflecting our Services, year to wins Issuer Corporate partially programs from up lower depository issuers. healthy the of XXXX. in fees offset market for were organic money and up in X%, strong fees the fee with previously meaningfully year-to-date disclosed reduction business compared primarily Investment waivers, growth prior sales seeing from new service existing continue In both We momentum already

offset Wealth The in X% X. into lower Pershing, slightly of On offset strong average and volumes, half $XX In An market to XX% business a by partially the volumes volatility lost were was deposit were interest U.S. and prior total quarter up basis, annualized management, investment and elevated reported an Pending impact of by interest X%, up waivers, increased compared existing fees the clearing and rapidly both reflecting Services and on X% back securities year. the revenue higher highlighting XX%, and clearance earnings waivers assets quarter. the $X.X in clearance demand of services in XX%. by up U.S. current reflecting second lower impact lower policy disclosed this amid the of credits accounts and and translates partially clients levels. Market evolving new by rate, Wealth market were X% Services, Next, Page In higher balances, of partially continued Market positive our increased for billion, and clients government loan monetary Services especially money driven this was on business higher for services rates up rates. by investment due last environment. growth inflows revenue by higher new Treasury interest balances. new XX% market revenue driven higher higher investment backdrop. net and for year-on-year. year payment Net client higher of money primarily offset lower services previously fee were collateral active a fees fees up activity fee treasury billion Fee to

revenue Page interest $XXX revenue million, Now turning loan X. revenue to rates was and down XX%, higher up and higher Investment on XX% total and also down Investment interest Management Fee and XX%. reported was reflecting Wealth Management Wealth of net balances.

about as XX% AUM trillion of net year-on-year. the decrease XX% currencies, U.S. in assets the impact As values denominated and under The by primarily cumulative foreign of partially $X.X market lower inflows. unfavorable offset reflects dollar are earlier, decreased I mentioned stronger management of our

U.S. saw has by well $X caused some changes the extraordinary mentioned dollar outflows and $XX the lower products government Investment as net quarter, volatility This relates the XX%, inflows of over significant lower as earlier. bond revenue of AUM the reflecting U.K. long-term Management, few to into U.K. it billion the in partially offset in In down we stronger flows weeks. mix, values, challenges billion scheme primarily impact from past cash. of waivers. fee As in unfavorable the the Robin market net for pension market was

down hedging Insight the agent of exposure. we manager and levels revenue, And portfolios. a was interest note no clients partially in clients to that were down their an market closely other primarily to decline the by fee has the X% as lower with was investment as liability-driven $XXX reflecting rates. year-over-year, resulting strategies, market Client XX appropriate offset revenue revenue market sheet in by lower Management, between our LDI been As their our higher interest working from of XX% I'd like values. Page balance have results shows of net maintain In assets Wealth counterparties, driven higher segments. billion values the

Based of as As close comments revenue always, the continued expect current market like our up another be we we on macroeconomic year expect the to year as quarter sequential about the volatility. remainder I'd we and see NIR XXXX few acknowledging of interest market outlook it growth. compared environment to implied for XX% uncertainty to heightened the on with net interest today, the full rates, now for approximately a

year the down currency now we values strengthening slightly fee they for levels as to fixed continued compared quarter. income as and the XXXX, ended at well be well where Given of continued markets equity as equity U.S. to the as assuming stay and third the fixed the expect decline in dollar, income full the revenue

XX%. throughout expenses, focused to had And bottom ratio leverage be we to target drive to I'll effective intensely XX% of and That the as expect continue XX.X% for year X% we well you management finally, towards working disciplined of of to X.X% a that the we half and said, as to are that year. ACETX an items range fourth excluding full within the the expense continue we between X note being X.X% range and Tier on in guided that ratio We rate target expect to notable manage this quarter. still are the up of tax hard

time. about prudent think that, considered line economic AOCI months, resumption the well as to a for capital we you for be deposit balances we As trajectory right please continue outlook buybacks With the the operator, timing as expected and at the will the of can questions? of open at coming in levels, that

question go first comes Our Glenn Schorr Evercore. ahead. Please from line from Instructions] [Operator the of

agent U.K. that to lot as because impact So both I a cases LDI appreciate a outs, flows for BK if get Insight produced ins little you wonder of your clients I in could more and and comments past. we of in acquisition the the the a about acting the has been great the in

in more So when and and business with think collateral are to what I'm do forward? going have clients lower impact curious clients get on balances this the going you quarter you

thanks Sure. this Obviously, the of for past Well, the topic and news few a question. Glenn, has course the the over lot in weeks. been

it Let's stands and is. maybe stepping what what just for and start by LDI remember back actually

So at liabilities. approach let just it's think investing it the the ultimately but value moving really in the that investment ensures more of the recap are work you line is liability-driven and I as that me with the assets principle know,

our to to pension I one, have these an important then that clients the that extensively advise be regulators principle, employed has expect overtime very by to important mean consultants the strategies in by And something we years. been the and is we They've pension pension would the space, been which so and who U.K. embraced space. think many going continue. it's been the in

liabilities has second to pension their The rates higher value actually the of in holdings. is than by have I'd more interest decreased improve more decreases say because of broadly, positions served gilt thing the funds the funding the most that,

sell pension contributing funds And U.K. the sort created of many you has pointed with in bond created that's going the and for and of positive issues, the speed know, gilts put on. on has of clearly calls a mobilize they the liquidity to net so order principal has the funding to look, other the the are derivatives. forms derivatives. This to pension been a to speed everything as that And strain clearly, able And margin had challenges of yields meet in and I But been status. that's on shows government rise can mean, the size highlighted liquidity the the and sort impact they issues, unprecedented the has sheer of magnitude challenges. also been out, of in markets. you've market operational terms the magnitude market, of pension as versus gilt And of the of have. in the these be you it's funds, some market on degree just including U.K. certainly pretty the that

liquidate a by think direct lot a operational sense. providers. some If which the a Well, of operational are additional just actually provide margin asset of that's makes been pools, assets actually happened clearly, versus raising party. liquidity, third That's support We across the to all people And to by settlement done of about Insight. and as you what don't time exacerbated wider the result of that? two-day

Now, that pension we've pieces. integrated also and helpful funds the is whole in to just the have over Insight of they that assets strategy time, the individual been, that be working actually really has which building portfolios year, throughout so to They've question, with protecting all look other pleased I prudence, on see called they solutions, the and across been performance. been encouraging to think, focused types been able they on Insight's client not a and been the of part your collateral this of buffers we've quite pleased

that a they've been And and been which of might investment a exist maybe liquid has big a the to components is that done in the where mind this I leverage actually crisis. elsewhere and So solution being in view with particular approach good done portfolio. of less think integrated proponent what's a

so, we the is that market. net-net, has reputation done our strengthened solution being Insight's quite well. actually think And in

they seen the new turning away quality. flight of frankly, are incomings bit to business fact, benefited, and as from the a In and they've

the Today's that's looks at still some evolving. market very So, bit clearly, of watching and situation week a of weekend. we're little the a following the it last But over better closely. end news

everything why all outlook. good balance they not sure and So just Or as are to about have be or a The leverage. last use I outflows. I away nothing risk, and source follow would think your like sheet curious color. that wasn't less in use Again, part didn't turning going feels I just on appreciate of major is it past, forward. new was you I going business? flows what clients this on curious it I'm the forward much think client

Yes.

the to the So, really clients. because business is been why our new turning away some of we've reason want protect we interest existing

our into And so and liquidity taking along journey. them frankly, that along franchise problem. the essentially there market with that and do and been then who've on to our with and more the moment This wasn't of clients and less didn't in are have some seem existing the taking in smartest to which problematic situations interest having funding like available the also, Insight deal

get for broadly, through So franchise. this, incoming Insight But we expect some to we there. to that calls that's differentiated of performed given view the positive be of the do reason more the actually to how continue and nature phone

because So the tailwind of actually, I as reputational these view out players. sift types of market different events that a of the in some are can something frankly

The go comes from Brown question ahead. Mike next KBW. from Please

declined the just expect given here. AUCA X% less So the quarter-over-quarter. noticed Robin, This than about that we'd be I market backdrop would

talked about strong wins. recent and sales momentum the You

that? this in, quarter? did when of quarter, could quantify you come kind growth So that contribute organic how much if the in And did

the AUCA the franchise I'll Emily, The diversity speak that. overall. trends It's is AUCA take really speaks of to in to the

services but AUCA growth on firm-wide Market security based That by So, led down was Wealth lower very Services, AUCA in about by and much about was X%. CCM. tempered XX%, of

what want and of seeing in partially bit XX% dollar, a decline, drilldown lower about that was that the terms strengthening you of kind XX% net and offset Services the to about U.S. as -- about well If by due was business. of new you're of Security X% values more to as there market

I But I that if you that and capital the could like that levels this share levels. correctly your if the in still heard dependent -- -- then quarter buybacks perform And as correctly the it it's expected? will be on buybacks, you capital market understand really Great. possible that did the sounds Okay. on comments it's for

I my be and really to buybacks. very it's prudent everyone in that understands to remarks, As continue with we're important to said going respect prepared

So I given and natural environment. the the across macroeconomic think we're volatility continued seeing the uncertain frankly, that that's markets

for our be We to above also capital resuming do want buybacks. -- our internal ratios target consider we we before

think when it everybody about be sheet, informed corresponding the conditions, quarter outlook. that the would changed, whether model and we a things be rates levels. But our that quarter, of as our next pending move I have impact allows size is rate will direction our will to capital capital approach we time, it's market do is AOCI, term, going back course, of -- of pulling to -- over that shareholders to balance by the and distribution, our true hasn't So, frankly, and this on what forward or remind trajectory always those that up it's AOCI frankly, in the well near capital both meaningful really as of as that Alcentra will to a meaningful a of business different free return amount sale and of the par, beyond

from Please go We question will ahead. Steven Research. Wolfe from now take next our Chubak

on margin. I start operating off wanted question with the to a

back Fed last are get I or help mid-XXs could take current highly to to operating potentially to fairly levels. In Company that you the of gap margins? While noted the you margins well above you've drivers tightening the credible uncertain. consistently, getting on of so close just path the your cycle, backdrop, the those generating type to was types what as see operating Robin, perspective a here? -- And wanted some whether operating remains those

to time, the reminding said were year, And we view Sure, XX%-plus I'll Steven. start a our organic going our this that of Well, you just bottom meaningful announced I of is be, both was segment, course, is that's a have also contributor. driving Services by know, cycle, the to to you, third, through on be my It as we in the on we margin where to growth. I firm. And was made as which we December components. in Securities rate we which, focus remarks, but re-segmentation been. contributor Emily in be it when going not And do to commented an fact top going prepared different line of a and then the that and variety be going was up mentioned at important our It last line. towards

for efficiency-related in a course have although we more very But is to technology. five for investments that steward of made we've us I in also before. Things I expenses and firm. as past detailed significant there to things room able microcosm about resiliency second, that that's And for be on over so you to good four feel of invest to like the of strategy if the some whole take We're that real-time on Pershing I've exactly growth our a a the the how payments laser-focused other investments. executing think X, the be and years,

investing process can line So because that the adjusted this budget of just process comment to -- the get and try on at moment budget we're a for business. that doing we've technology our margin Emily in season cost question you in bottom a to and top really on maybe raised. really our line

Sure.

rubric applying it buckets. and tech just forward doing And entire are, cycle down we've at that historically, budget focused but on kicked effect, our as all trajectory. across on company. our expenses used rubric mostly the a of doubling we've for three in stratifying we we're what the looking So in we're we're actually across that actually just and expense intensely is And off, now Robin said, that

run is bank. or structural the So first really

obviously clear change or bank, drilling into just rise and is for be really category to continue top to obligations. regulatory matter, are ongoing very course, that investments, And if the with they we're the they revenue growth. making for line is too to transform meet about growth, are they related, which Second of bucket we're that third, third are

do are very as on higher So has very, structural I be, as alluded heavily XX% our the And driving that go these expenses which we businesses can we're think have this, are to. more of make we certainly areas, They some we are highly planning programs they et when you fund efficient, the In accounting, we to focused manual Robin come through and in programs nature. that them more like transfer share down. have cetera, multiyear back agency, process. and nature, we'll are where higher we should to than in than finish

follow-up the the this tracking outflows elevated at you outlook, at expect a still total fairly And that the in Thanks deposit you on of trough last? to pace it's better been cycle XX%, noted of have maybe really perspective. of cycle? ultimately that trough last relative deposits, for better somewhere Emily, cycle as to expectation cycle. And color. non-interest-bearing where your this this outcome I helpful what's What's far so It's non-interest-bearing for XX%. driving around all NIBs percentage my And do just outflow, terms the believe,

to I which will here we that, fourth and NIBs We I've ultimately be we believe mentioned total to base. our quarter. about what revert would of think actually happen the in might XX% So pre-pandemic, think still XX% that deposit that saw

of held risk-off terms they've is of behavior. think that I probably In steady, some why so-so

good. to businesses. the We're due become more non-operational and I far seeing say that much and very very thus of irrespective think nature much clients what what's ultimately, -- in the deposit this Some just and seen are we we've And that's a is segments actually I our important, when trend our largely been at that have runoff, and businesses overall, our and pricing is seen sophisticated would very bit we runoff bigger. or right across IBs, look has statistics NIBs is

from Jefferies. will Usdin our question Ken We ahead. Please take go now next from

we Ken, you. hear can't

off mute Please to allow is our your reach function equipment. enter single your turned to

to next the Yes. move on Ken Operator, let's later. back question come and to

take Graseck Betsy from Please go We now Stanley. will ahead. Morgan question our next from

Betsy. color quarter? And of What the goodwill your driver flexibility specifically Ryan more more give is on strategy behalf charge. charge the management. investment on and This this could of if on the Wondering you was you Kenny us does give it

Happy Sure. to.

about let's So first it and of is clear all, what it isn't. what be

regular of and of across equity testing and income any and it outcome it's going not of related both it's we've a the changes today reflection So a about a not strategy. It also of the our the It's also forward. discount markets pending also business is lower statement sale the it's process, not to higher the outcome rate. impairment our And fundamental of Alcentra. the and as see market health that we seen in fixed values

your strategy. is in the up wrapped inevitably So question

so that for just on journey. I'll a management And where maybe second, recap we are investment

As helps to and once independent We over substantially used years past the XX strategy seven That's to we've you investment know, is we've so, the course to XX that focus That management firms. as individual out improved sharpen our down have does or center investment of closed. the alignment the streamlined us the between the portfolio. firms. fact

of last people of example in space. We're And money talked realigned about management investing and on we've those solutions, We that. think, investment the space, We and of into another in earnings very healthy. responsible market of Dreyfus. the and investment some want solutions of clients in for the our so improved investing. performance I bold, focus that investment Insight fund the remains parts types our And has and internally. importantly, this active It's call Newton Mellon's outcome-orientated then helps day ETFs, externally and sharpens less it age also capabilities and confusing think make the in course, that,

So kind of we are. that's where

question ahead. now Please Alex take from Goldman will from our Sachs. go Blostein We next

a been well. to in your there's in challenges market, of and number alluded the those liquidity Robin, as prepared remarks So you

risks, mindful about to a thoughts your in as we the should you that the well, as looking sort of any for opportunities And be think So markets serves, function some that what obviously, most on I globally, love bank fairly would kind the of of I environment as BK are creates of capital critical after. plumbing this that. guess, you're hear

Sure.

So moment of system. crosscurrents Alex, different in we've got the at the bunch a

we're side, complicated the QE. on flip of clearly then Central driving necessary it what supply the don't is aggressively and given at bank and prices, recession, got very On But which issues cash necessarily these things risks back inflation, time, is of coming happen always prints. front makes the we've two the already very geopolitics, is obviously continued the same side, ongoing off at chain center. much energy

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Securities. next our Mike ahead. from Please take now from Wells question will Mayo Fargo go We

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expenses. re-guiding is that said that she said So original in not aiming that lower intact, we're also range. X.X% terms we're on all, end of towards of the of first -- but of guidance to X% Emily the

focused, active Emily of our to journey. at. on confidence So earlier very be a we're management which this own as of of And that's sort very, we are meant on, really driving said in expenses, vote

us should how to that And give you on do we on expect so over to continue time. you updates

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UBS. take question Hawken from now next will Brennan Please go our ahead. from We

follow-ups A deposits. on couple of

previously on up the -- you down there, in average. They maybe Should XQ of down expectation being X% is already how on would update we $X $XX still that million you or XX%. tracking to that your could if that the an and seven you've basis by Emily, too? expected different, might had So, that were to think deposits about average they're on end indicated fourth be down beta range quarter actually million based

Sure.

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this so the and based this So, are we forward on we curve anticipating and what curve been forward is what the ultimately, have seeing far year.

anticipated. continue of terms do to be than betas, betas better little In had we a

of widely do vary they note, line by a Just as business.

and certainly much treasury So markets are trust. services corporate asset say, than have betas servicing higher or

in just important it's that to So mind. keep

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Yes.

another for a about NII But NIM. and XXXX generally early year, on we've back of back be we of expectation to speaking, bit to to comment next this it's know just point, but Helpful sort question. Rates robust. then when And gotten at sort related Okay. triple-digit too get I think sure. pretty full to year step continue

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there, lot to a there's bit. Well, it so try me unpack let a

and seen sharp seen you the a quarter the several but to have from we've expect that As based mentioned. We a slower expect fourth We NIM do in financials, do another factors even consecutive probably increases the beyond our will quarter NIM. on step-up quarters in continue lot rate. at of that fourth of expand you

In think to terms actually the that of portfolio we rates upside. surprise continue will positioning, do to

obviously, capital for NIR. can liquidity there. greater managing portfolio as so, sensitivity. to And of optimizing overall, we about And therefore asset we well But we're course, the really it objective think as be positioned continue the we're nimble as of with

from ahead. our Deutsche now Please question next will Brian from take We go Bedell Bank.

spread actually, that versus funds of one on contained couple question in technical and as asset my think million of just quarters? that as in how point Or kind just side. more well. to rise on I book to XQ the spread, that's was went XX% in guess area? a up with of the spread we the about a $XX I on matched about poised book next sort liability interest second on of is quarter. that that That net purchased income should that in Fed Maybe dramatically the see

IR. follow on particular think with up that Yes, question, specifically think I I to best just it's

we you're the growth of would for there. exit kind And outlook question, that NIR, our If expect on a the the which kind probably of to just see bit forward kind the more based talk some asking about of drivers broader-based specifically QX about today, we the rate. curve is from

expect that largely do continue Of because the we and majority a us year. year-end. base betas the large sheet. probably most more the sensitive And central could for expect as think organic runoff, and the rate, remain of have to institutional balance be growth marginal is the to mentioned deposit than do will about, more of I've we also little increase. I sensitive sensitive bit We as already that's outflows again, course, client talked NIBs, rate increase We to some earlier, size elevated by behind a rates but will banks of our

would into some the growth kind quarter fourth expect factors of exit those just that rates. fact of from we our all coming So, are

of Of uncertainties. course, lots

That's real-time growth could if the just great to that color. in prepared your And focus Robin, pivot maybe remarks, I payments. can initiatives you talked if maybe on organic you about

the X% do plus of can think these organic course, growth stay I You've what -- a there you And a know Or range if digital talked you're early in enhance while? we're a rate. and, a if initiatives recently what going about X of to But little in extent for the don't just too that target or out to little talk thinking it's that you to can lot sort put of sort bit Pershing you for X% X%? area? platform. about maybe think the

early little So, it's specific for a too a target.

different some mentioned change It quite that And all reasons. a part one. each at for have established as I new for least we're ecosystem, rail. remarks, businesses, we'll in I change whenever or order the of in opportunity of sort the of for payment there's interesting you disruption. a think the a talk better the the different various disruption degree about question. And my a we prepared me that the or this because have real-time few come is a is of But of of in working understanding through payments As priorities out sense all on that, let

opportunities think us, And every we that day. so those along don't for come

focused they advantage platform protection fraud payment provider, not it we taking And nicely. clients. part a the banking and we're is provider solutions think other interesting the that. of validation, for for we safer solution a But request it's when so on But is of combined payments payment set And do good. to it's with and payments in invoicing that's also ability broader ourselves this system. become a as entry overlaps payment nice view can just data and for because the when faster quite where digital but very with services, combined very And into is providing

of fact we they That capabilities, installed that in the other top to expensive regional RTP, customer case advantage. whoever up cover frankly And of validation, that it's to think to running, you side, take and regional world's banks. now us real-time access rails advantage collective we account white very invoicing. really and know, that and We're has with an we You'll that set Fed gets XX% wanting of all soon-to-be payments. Fed of real-time it Zelle, And fintechs for to as rollout either first and first a process of the makes providing the investment, XXX bank FedNow, in working as of then the case of and to a thinking label banks a as now as the launch that banks all actually banks. closely bank we've a make are well. the very leading We remember with with other case and but product makes and as that base some the the very we're in partner real-time the with because don't they those appealing well, that the whole in want the to the or leadership were were this fintechs on done us about part e-billing of make be solutions

it's of for is I reasons that an those this So, think all interesting space.

a haven't number it, franchise certainly getting We we're but on traction. put

go question Cassidy from Markets. Gerard ahead. comes RBC from And Please our final Capital

you be your us you with Emily, view, I go we with are rates you can portfolio. you can share -- going guys way think In just managing forward. your think securities share us said as you will higher

at go to the on some as moving held-to-maturity In terms forward, the versus protect strategies of of you AOCI. sale you into are how the And you available looking AOCI issue? for

Sure.

really to So remain inflation change central upside. or that as I that. before, actually frankly, to the change volatile environment we rates evidence surprise tone say is to some And the banks need on expect from do did to would continue and declining to probably some in view our we

Duration have time. continuing the for about portfolio are it's the sensitivity. in XX%. we also long So, really been reduced position asset by lowest we a Year-to-date, greater to is DVXX

earlier also in to You did do year the against mention protect take that measures AOCI certainly, volatility. we

we very taken sensitivity. available of But for as And maturity certainly now that, we a portfolio, they about more, the been with course, change, greater have had AOCI has did would benefit of in diminishing nimble actually it so, duration. the if we are portion have fact a going to than not that short XX% XX% we losses. held that is action. sale move said of is ultimately, very, and Having been portfolio should portfolio positioned to They is for the have of asset that designated the helped do environment from the and be unrealized

be So act we very pretty flexible can and swiftly.

an advanced have you make it approach since bank. so much sense Does sale you're for in available

through ratio realized some going and take already yields? it's So then redeploy at losses actually your to CETX higher those funds

want very want feel We We risk, to of rate well. certainly only where of flexibility interest managing in flexibility liquidity maturity. course, and also to the but really around retain not terms as held we comfortable are

Very a follow-up touched your to you've as then your just deposits And I about today good. questions. know question, a in answers lot

question in change billion last $XX the out since one -- to in full here the the now quarter. going you Have deposit you on fourth when to thinking behaving operation is as QT all? year, any speed change to Just are billion, And expected? out $XX outflows we've down it how is deposits. you you to your States. deposits that do at know a come United I next gone is in noticed But going month? Or look in the you

Yes.

to us of the reminder, significantly this will be rates proven cycle. since even of the as end Why pretty deposit are just we seen businesses We sheet. in actually are we outflows behaving lion's year. behind runoff past as the share our a They've by as the institutional client the Also, think think predominantly do -- balance we've much think much I is They've much that indicated, base than I size sensitive grown what the more anticipated. to much the in are and bigger. last of now. our just Fed's be

and treasury runoff, been said it's naturally And I that more bigger just is suggested non-operational. as seen services much where deposits. AUCA is bigger, the much mostly or asset servicing we've even comes, what So in

much macroeconomic that in here whether there's said is of rate volatility, So uncertainty, large RRP, that, I it's interest expectations our feel general. be I so Yes, the uncertainty there we majority good think the mean about runoff? behind and Having pretty levels us. the could more

the So of far. curve what that's our on best forward we've seen based thus estimate

or conclude And with call question-and-answer that, does over closing I to the additional now for our any session that remarks. with hand back today. will Robin

and Thank interest everyone, you, BNY Mellon. in for operator, thank your you,

If you well. team. have please and Be IR questions, to reach any out Marius follow-up the

conference and great Relations conference you. call Mellon be Eastern this replay website of a webcast day. conclude Investor today. BNY Thank A X:XX Time Have and webcast. will today's does Center p.m. available on the This at