The Bank of New York Mellon Corporation (BK) 13 Jan 232022 Q4 Earnings call transcript

Good morning. And welcome to the 2022 Fourth Quarter Earnings Conference Call hosted by BNY Mellon [Operator Instructions]. I will now turn the conference over to Marius Merz, BNY Mellon, Head of Investor Relations. Please go ahead.

Thank you, operator. everyone. morning, good And fourth earnings our quarter to call. XXXX Welcome

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

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

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

call as XX, only made Forward-looking of be this statements and XXXX, on January updated. not will today, speak

over that, Robin. to turn will With I it

you, morning, us. Thank Good Marius. and thank joining for you everyone,

quarterly comments XXXX make you to results, through like Emily some on and our Before on for areas of our takes XXXX. I'd focus broader performance few a in

on prior of see and you down our we presentation, XX% highlights of share X to full earnings Page XX%. per compared the As financial reported for return $X.XX, equity of a the on tangible can common year year

impact of the which XXXX. equity notable of against reflecting operating per was Excluding XX%, a performance earnings the on complex $X.XX, of backdrop common tangible items, solid environment up of and share reported we return X% year-over-year a our in underlying

year this items. included results several Our notable

our revenue efficiency in made to decisions a the related goodwill to the related number reflect forward. we of quarter. the trajectory the And improve impact impairment quarter results For quarter investment Russia first and our in fourth of example, growth moving management and that third to those

Together, move continuously these than meaningful rates. upward faster continued from benefit Excluding offset than the and while the see factors from volumes client as stiff lower little we items, revenues grew in ourselves to levels. positioning to strength headwinds a in expenses interest activity notable more derive market

organic the we're growth assets of net custodian, On as inflows in the and our role continuing management. largest AUCA, under back we saw in cumulative world's

I'd performance encouraged Beyond XXXX. to couple I'm our by numbers, like of highlight particularly in where areas the a

secure, and dialogue to momentum, support throughout strong Services Treasury In $X.X through our the the our AUCA total difficult to strength throughout their is of and a quality we're saw businesses And launches larger will the we receive quarter, funds XX%. over This to options public integrated access payments infrastructure the by in broad send, enable cost businesses. and based by off related and Asset payment serviced focus for [indiscernible], and And payments XX% ETFs, digital sales environment. and new technologies. sector. FX minutes several Servicing, also inflows of by digital request service we payments build trusted more continued up speaks using effective onboarded quarter in our clients higher deals, during the a real hub AUCA other time growth where hub and and and to franchise and to our proven continued faster we with refunds dialogue Conduent matter payments clients as strong year the announced where clients business deepen to continued elevate us which capabilities. the offering clients fourth wealth and our we fund reached ultra who market, net of rose were percentage difficult by XXXX. expanded on the particular and First, matters. a wins XXXX In wealth our office through provider banking rose while points. be strong XXXX while client to more a segments, they we a X net maintaining acquired worth our to high bank delivered family client we XX%. grew finally, client environment Sales about of of number in elevation a launch trillion increased And and which value as we doubt with the as percentage advisory management strong a payments existing was winning the also strength with no In relationships our collaboration for

brought Notwithstanding offer. in in over very exciting billion, capabilities growth. broad as that fact, the is the In assets our play of wins, wealth the the in backdrop, largest Pershing, company $XXX uniquely representing net announced quarter, which demonstrating is, X% tough a Pershing based to new fourth to we space, positioned

was first former of thousands founded size And also exciting millions is serving country its and reach Arta State of given Farm, an agents Finance, of Google with households. Farm’s we relationship was of which team by The the onboarded who tens which a investors with across an State ability tech tools is our win are forward family and point intelligently. technologies invest win advanced clients. capabilities now global our uses leading of important demonstrates with a to empower and office digital to of proven to set This APIs that proof digital executives

crypto so broader opportunity highlighted us, I a month much Financial the focus in OpEd call Times area asset that for collateral the to We and help we reimagining leg our second medium trusted of October. in term. position recent initiatives forge I'll of went ago, in to only continue digital the out The as with space. continue And providers in really will further in digital platform initiatives for and longer-term the the next as for the regulated this highlight X, need our a but technology. will company my growth beyond not the ahead the the is digital If distributed ledger the custody live Pershing performance, anything, that real-time the digital custody for such events US crypto exists asset growth assets. with of in These payments, assets be market across and

Client year initiative. This first set direct also a Persing importantly, Reporting just with Servicing; are release Portfolio our now release Data and one and indexing; timeline But launching small a tight products: the a to and three on goal includes to is clients our of We this ability select live equally execute. Solutions, X, number about after release at tools. including core

of markets I outcomes highlight in in and serving to the work cannot surges, their and of for readiness our year systems me and our people for our our remarkable most dedication successful consistently the probably hard clients. and third for enough resilience. debt people we moves enabled people volume saw operational our clients. the thank several once Finally, demonstrated important the again, war extraordinary systems, is our Across our the government and Ukraine,

a headwinds, growth proud we're accomplishments, was where for year short a to ex-notables. benefited important throughout second On straight area We While that acknowledging too it's a expense we especially expense these US notables fell year, the of currency X% consider also an humbly growth number past year. from around the stronger inflationary this recognize expense X%. was ex the dollar basis, high, growth constant considering approximately

focus still While months by the renewed areas ways sense urgency to brings we me our key on encouraged to last to over go which our I'm of expenses, this for XXXX. journey, few manage organization a across better have the the

aren't discipline fully year. on bending curve profitable focusing Expenses. the business cost should implementing things to more that across more and firm with. make committed also to do business when no a are BNY I efficient simpler, be. growth, saying to going they economics ideas the My come are more come from this will First, the will team new That further from to leadership what and Efficiencies Mellon expense place instilling from

an enterprise the products, on employees ins driving one leaders and initiative, here, and and of And the wide and by sustainable efficiency growth. enabling senior focused on outs embarked knows so from high people. around we've than processes performing our No better our services led world greater

take another our submitting stakeholders. completed initiative upfront And a the date, the the detail, be on achieved year a this have renewed high ideas we to so company our approved better are achieve for of recent all a of initiatives to what quality all which active our of and to XXX way and requiring of in we've an this meaningful about to of year had about for Emily efficiency savings this in run already we implemented XXX To as these in expect amount little investment. ideas are double the nearly staff of X,XXX by these can cover track we role more ideas, but compared result determination, how with in any amount will this opportunity years.

But our managing about priorities just not expenses. of course, are,

profitable on We reinvigorating growth. are also focused

businesses, and from achieving project this Our all asset particularly across of year growth Pershing with underlying our almost services. commits treasury healthy growth coming to servicing, positive

to that investments targets speed I we and earlier full hit course that with ahead the the continue expect of long will critical over with our year. growth term teams the clear specific mentioned We

and line, goals surpassed business initial that In include increasingly goal our for XXXX, we equipped Lastly, for as innovative, further clients. our Mellon better One to saw our and on intend only year, priorities multi top our for business we which and we Mellon's momentum XXXX businesses cross is platform initial provide. our of BNY a the to good program, collection incentivizes solutions and development referrals sell of in we pickup the connect unique the dots BNY deliver

which authorized provides we're a of new I'll ample us flexibility our management, ended targets, capital year and Board program, now buybacks. $X on billion the Finally, highlight resuming comfortably has repurchase management capital that above having share our Directors

like the in XXXX against some franchise urgency returning this what of exactly amount plans environment with so drive and will discipline look efficiency on to we healthy XXXX, operating and capital And our focused a in of shareholders year. predict can leverage positive none laser the are us executing growing to summary, while our while operating in

it that, time CFO. over last Emily our let me With turn as to one

everyone. and morning, Thank you, Robin, good

Starting walk items. on the on of year-over-year comparisons quarter, excluding you I unless reported I on the financial be highlights results details in Total notable X% of all through up our a otherwise. and will quarter fourth X $X.X As for X% presentation. basis billion specify basis of was a our revenue Page the down

as of earlier of Robin in from our resulting included million as portfolio, Security notable equity securities market expand from actions and revenue you bottom revenue, dollar. later. approximately Services few which can the healthy previously and fixed lower Fee our was both As of recorded offset a will impact investments items flat lower mentioned stronger money and to of revenues Wealth repositioning across the in our growth impact our Services market resulting page, upon income the of at and and Market a the unfavorable organic and of markets the benefit segment a included net securities and revenue waivers by from was results I values Reported improve fee losses fourth and US $XXX trajectory. disclosed the see other expense quarter reported

X%. Firm trillion $XX.X decreased wide This in other $XXX of revenue US new under market trillion lower and/or currency the $X.X XX%. values and offset unfavorable assets tempered management by of quarter basis. and custody reported values was by headwind And net the this under partially impact both was continued of clients market also dollar. from negative of the The in reflects headwind Investment by and translation cumulative growth million again, on stronger a existing declined by assets lower was and administration inflows.

primarily million the macroeconomic changes revenue trading Excluding performance. good interest items forecast. primarily up amounted approximately for basis, the items. reflecting X% expenses results credit X% EPS Expenses revenue provision and quarter to another $X.XX, was XX% a return by in was positive quarter, were And $XXX losses on Notable million, in was income pretax common reflecting XX%. interest equity strong a notable of On reflecting investment XX%, was or primarily margin in reported notable net and excluding a higher rates. million, tangible $XX other fixed increased severance $XXX was items,

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

basis throughout interest to reported Page half revenue notable and the net full grew bottom we XXXX positive other our consistent up were flat. on year Investment was X%, by the and $XXX reported towards excluding negative million, items, X% on by to X.X% was on Total on goal basis and excluding revenue Touching growth XX%. up X% million items. X% or was Fee $XX revenue to range a the notable X. revenue notable XX% year. a up excluding with of Expenses drive that guided expense and the items

$XX up $X.XX, approximately were in the Excluding On ex $XXX return XX% prior XX%. a pretax margin losses stronger benefit was million dollar, benefit basis, for the reported of was common the credit year from compared EPS equity tangible to expenses was and X%. provision year. notables the was million US on Provision for a

X% on Page the notable was tangible return of was margin items, common EPS to On Excluding on XX%. and and XX% liquidity was year-over-year. equity impact X. $X.XX, up capital Pretax

Our up of points comprehensive X.X%, consolidated Alcentra through accumulated in capital and reflecting dividends. capital by approximately was offset improvement Tier X XX leverage sequentially, other ratio income, basis primarily earnings, the sale generated returned through partially an

Our CETX capital XXX points up LCR up And approximately was finally, sequentially. assets. basis and by weighted our the ratio was in lower driven XX.X%, risk X points, XXX%, increase percentage

X% this offset our expectations averages, this, primarily deposits of expected than share the decreased and quarter across by billion $X.X by and investment will increase again, balances on up noninterest noninterest interest and XX%, to and than deposits deposits interest higher talk positive bearing balance our NIR, interest assets higher declined about increased and optimize down by securities interest net on a historical bearing higher also as sequentially. earning bearing Average continue trends Turning revenue which down percentage held XX% elevated. capital. Once funding is better deposits X%. remained to to repo we which in sequential our value exceeded footprint deposit Despite portfolio X, the terms. bearing X%. and Average up Loan liquidity reflects partially assets, quarter, This Net noninterest deposits our X%. decline of actively interest costs. of increased Underneath total sheet I as revenue remain yields at the NIR return in XX%. that, were manage by was by was flat. cash reverse in balances Page on earning has Within X%

coming higher roughly our fourth roughly earning bonds, municipal to XXX securities sold. which significantly trajectory with that of sold in longer X% we yielding mentioned, $X yielding billion the for took and years. more corporate securities we what points portfolio improve I than NIR the replacing quarter, basis the were to securities actions As reposition on we to lower dated we've been or the XXX earning We

because While we recognized the $XXX this approximately sale, loss transaction loss was already an capital million unrealized AOCI. this with in pretax realized virtually was neutral

of credit up portfolio In fact, we capital replacement lower CETX RWA. higher freed roughly consumes million $XXX as quality the significantly

to up on Page year-over-year. X. expenses for Expenses Moving were the quarter on $X.X X% billion,

investments Excluding notable impact well benefit items, of expenses, related dollar. higher stronger by the expenses expenses were up the the as distribution X% inflation, year-over-year. offset This efficiency US year-over-year as including partially of increase net reflects revenue savings, of

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

I line and Market business, were Security Servicing, and by Issuer of our As fees values dollar of X%, of the our driven down new were on In offset comments In as a each and supplement. I issuance activity services the money find the were fee higher cancellation at impact waivers financial will you lower and investment of business. money market higher fees Services investment client US Wealth my in fee receipt can fees. market net by Asset abatement services up services and the stronger market investment for fees performance focus services, X% discussed which Services segment, mostly waivers, of reduction depositary

fees gain billion, on related from assets Net higher activity, was of up and partially were up and reported XX%. were the business accounts Services, of volatility offset interest by evolving wealth in by in waivers credit This fee prior impact clearing in Clearance revenue and $XX muted and up average US very up fees total new prior naturally suite level treasury investment the increased from distributions year and to market growth and billion, balances on driven higher an end reflects earnings and And investment year-on-year. Management, the were clearance money existing while dividends and market Fee Page benefit were was higher levels. and negative primarily continued impact rates. of and higher XX% elevated investment healthy revenue X. due to X%, services higher reflecting were monetary more year services money for fees Treasury net fees US quarter, XX%. In capital services waivers, Services lower a flat. lower of The clients active volumes In market up business by $X.X services Market Wealth back on the were of Pershing, lost to market than net revenue government securities Next, new increase lower XX%. interest demand fee Collateral policy. flows X% by reflecting offset year the fees client

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

Assets and of lower This declined offset dollar under XX% unfavorable partially management decrease $X.X by reflects inflows. cumulative of the year-over-year. stronger market by net impact values US the trillion largely

primarily the fun. during In drives back market most capabilities cash and our money in net term net a into of to quarter, notably resilient relates billion revenue stronger market to Management, lower by it reflecting net Client includes XX% money healthy year-over-year, inflows the the the be severance. liability assets in market XX% active values. performance, value, investments strategy, where and saw term lower in down by net other lower and market were $XX results million XX a of of long a Investment was very of Wealth billion mix partially from of sale down Alcentra market strong recent and Among down strategies inflows, US And the investment of $XX investment Page segment securities primarily repositioning dollar in with net our was into portfolio on XX%, of market to dislocation, driven cash. inflows of testament As driven of spot the products billion bright offset $XXX we the quarter, due the to long net finally, revenue $X include performance market real a in waivers. Other flows lower shows leading the expenses continued our the and and Management, outflows inflows cumulative come loss revenue value. our fee

Now few comments healthy regards With a of XXXX. about let growth. thinking positioned to me close have for how NIR, we ourselves on year with we're another

wide currently path an year-over-year and implied full increase well remains potential And of year be relatively of project the as rates. assumes Having that range market dependent various on interest quarterly including interest outcomes so we as of mix rates. and that, the and levels approximately for deposit the factors, will NIR trajectory said current XX% the

fees, in levels, and market Management. Security equity As was know, and headwinds and currency fixed Wealth XXXX factors growth across in Investment while Services and income and to by Wealth driven fee it like underlying you Market offset relates as market Services industry dynamics dominated

to fee growth For some to XXXX, we firm. for the expect underlying return

X% notable the where for or invest sure Now into X%, remain ended the This continuing an to while year XXXX. to corporation the expect expenses, about XXXX assuming we're approximately This taxes, last exchange on primarily increase XX% cost tax to be this in currency been a few on for increasing the tax work effective items by by curve in approximately in to Robin then the bend basis. to making XXXX. over we've months talked we the rate year. X.X% UK our the XX% excluding of they And range, due flat compares to rates to doing constant translates rate

management. close I on few want finally, a And to remarks capital with

new our our And ended provides us target. which $X saw, share program, Directors flexibility. a billion comfortably we you XXXX management has above authorized Board As ample repurchase of

in position repurchases is others. and we’d return you timing earnings resuming [pulling] current the AOCI par, combination we're amount Based including prevailing north expectation for conditions, XXXX. dividends now operator, various of estimated to can growth earnings the line trajectory for in questions. on subject and please and of through factors, always, market of buybacks to our As and buybacks with expect among XXX% continued With open of capital our our to that, the

[Operator Instructions] first Brennan Hawken. from question Our comes

sure to current you was these First, years. here Emily our real to you work quarterly, won't but past congrats on few your a role. it pleasure I'm miss with new

down to the on expectations. love I'd NII So drill

market You of that current some walk indicated that drivers, moving XX% and the through that assumes pieces assumption. specific rates, but please assumptions it primary you maybe could growth more us underlie

work Good morning, with been of as Brennan. all you And well. it's to great

as about So use NIR the our of that if would thing forward first you just basis mention I the think is we a the to outlook, curves projection.

probably So for we don't end The the get until you as [acute]. quarter, the of US by XXX assumes the about year. hikes XXX of followed try basis of that the assume Fed basis pause first to ECB. [Indiscernible] the the worth all by the hikes both And of a outside curves know, another points to in and points XX

I year, well I just actions in meaningfully of the portfolio. as, these the of and mean that, say, rebalancing et rates did throughout floaters, in positioned we as the result shortening securities the And portfolio rising that all that a by would duration, curves as but December, we adding the cetera. So taken obviously don't we've

to do significantly that, expect with all from So higher we yields. reinvestment benefit of continue to

marginal relates we so balances. dollar tempering deposits for continue to modestly, it, digits average. as course, to but increase, do low of to bit, quarter single fourth we expect call them And would expect Now decline betas, to from it to finally, non mid that a more

we're lot be levels there upon upside the I also So It retain there's more deposit that's and But if prepared market we outcomes. there's for say many NIVs. in uncertainty some year-on-year. and guide different certainly, highly a will what's behind XX% really dependent would of the

the accretion this you some have prepared rather in your announced quarter it large on really was Capital positive guys and Emily. comments you encouraging made buyback remarks,

really, So look the if accretion like? I how remain what source from my yields does be How perspective. thinking think, should -- AOCI from was we big here, the stable of timeline we AOCI about surprise that should

change portfolio rates, of over are to forward the portfolio The assuming forecast So the -- the close and realized. latest loss to it, probably $X.X XX would unrealized the of, latest doesn't course billion XX% expect call our in AFS recover of to XX months.

comes Our Alex from next question Blostein.

funds could of was bullishness a inflows you income us ecosystem a for There's hoping there frame mutual -- a the fees whole markets. ETFs? that in large Can our outlook I multiple question and Just servicing more particularly curious, fixed an and around fee kind and to we get how servicer fees of we specifically different as generally think start income broad touched I'm both help like particular ways. BK's with a flows, just fixed Is fixed guys overall assets, you ETFs. granularity little set it's as with versus of from difference, outlook flows, outlook very the could fixed on for a from to about income income 'XX. respect outflows? benefit when improved for hoping

far so would not income averages that markets would fee base are well there's average what that XXXX. soft equity say be fixed the we think about that US, markets outlook, I off is from is case landing just our assumption as the as in a in what seen we've just as So relatively

would a is business. that funds. modest market highlight our You balances said as correct market strength investment fixed degree. any we our money platform I are does to money runoff the And in income of benefit well Having expect play in that that, that strengths just does some market the to management what also in do really

just things of a that. to would add I couple

think the them, and a in Emily generally. fixed our a as of couple Just franchise, income water on the have you lot mentioned of across we Os of breadth

income, business that business. servicing income fixed heavy, is to our heavy, So gives rise security asset fixed a lending

our We of have worth a $X.X cash on trillion platform. investment

short end the overlap the in as income plays market, well. that fixed obviously an with which has So of

which done have quite of asset course the We which in market and year performance has fund, our really the has terms -- of drivers well gathering. money over

business have in terms our business. treasury of We our clearance

We business. market repo have our treasury

to we've opportunities all a from and of of this, them. attention obviously of lot all got So we're paying different come that

on of And assuming it Robin, you're maybe ready step talk targets a the a operating and also were time? short I'm that like for past, not in have they're whatever about you a top the if going programs, the that as Is interest efficiency whole the to mentioned, kind you just when business in place curve are broadly, just of think you back year. goalpost ultimately forward as your the firm north the follow those your expense of XX%. sort nicely But about take what's my then leverage this ins sound up of in number the guys and outs guidance in but How bound remain that and you range incorporated that and ramping of in or of shipping term rates was programs line? you forecasting. you about sure yet, thinking pretax the but margin for over sort on

So to question you're made but reviews. talked strategy and I'm progress. We've we're working the eye ongoing. we are think about line high on my the continue right the months that to into on They And four it. still work. performing growth, good and doing in I metrics some pretax on It's that key relate tenure. to across half also well, we're an just and the margins ROTCE, focused, focused driving but revenue top and to margin, using. we support true We are you you but look function on that true business have bottom really drive the are discipline also your as It's on profitable line, when the that. growth we exuding got think which through is with things a expense we've culture the on side side. We've

considering year Now look of you and we different transparency progresses. forward a are as to all KPIs some KPIs more we giving those variety the of

work, you And as talk we're the and do to so we about to it. come going

Our Brian Bedell. from next question comes

Maybe you bit, markets. to could from. throughout if income, shifting that have a you expect of of landing, you you a to growth talk could course, do there in deposits the that pretty what even is the thinking platform, actually Can you revenue us could every then expectations on and to pressure bit remind XX%, it's think. extent deposit areas, lot think soft fee don't sensitivity a talk have some that? scenario we gears a little where outperform say, on the In be market just a X% recession I resilient through equity you I'm or I we still And And benefit described to in declines, let's Emily? allocation that to plus also just of assume would if good about which of your a which against scenario, fixed the we

probably. of think add on will comments Robin a So and couple I there,

sensitivity just income in fee our our terms fixed So market. overall, of to sensitivity

as strength idea have so to markets income in Just X% that And ultimately or that every fixed remember that pointed would also businesses fixed that. how revenue gives for market. about from some fee on certainly, so change to tune we out of in impacts benefit you [spot] $XX then the million, different income annual gradual earlier, many Robin

else. something me But Brian, just let add

to I things margin understand get to banks, I and the we we're particularly, be broader a in But for growth, to -- often why. higher us. question, trust that answer trust think and businesses happen of have that a compared obviously bank, relevant your higher quite is portfolio they One

like balance things to diversification helps that get things as different with that they're and really market Pershing, Business. and our Clearance Treasury underlying for we Services, of Collateral we Management different a So portfolio contribute the the so because Business, And do underlying essentially our stability through have things, revenues conditions by driven firm a those like us that.

mix well. course, that, the that of about of make we're, to on we have Now as top revenues the are we sure increasing thinking of that of how types

we're but NIR fees. Yes we have So and also net powered subscription transaction by powered feed. yes, volumes, we're by we have also

the relatively perform in of us so a diversification significant effective in some why of fact, these and market pretty the in gyrations. through the and stable we and us, streams, different conditions, the way types that's bit combination helps of you've think of revenue an seen businesses And diversification the quite

the be organic telegraph you revenue you -- then payments think venture the the just especially rate term investments year continue what of Robin, might think can contribution a definitely on sort might think sort you reasonable terms And if and if growth of this digital maybe, be outline just this But long initiatives these with year? or are in trajectories. outlined, maybe that you payments, growth want X, for or you've to of what Pershing growth rate --

a validation connected for fraud pay creating it account as the of term fact talked the are as is and services. we've time small. bill initiatives opportunity are that to about But this payments of So medium contribution from Think we these see really related set things. real and of an the and we revenues and prevention and they rails see today do future,

that have ecosystem to it, businesses. an briefly, strong made. some Pershing, asset for that's a that time, same we builds the with We think into it our tick for through like In assets think and we've we're of And quick new each I the And digital Look, future in Servicing, we're had the I Pershing us, at leaning very try announcements growth. around focusing as on talked sales. we onboarding there's got actual the But but near seen medium we've about play that if X. in a the in of And net things we've So of and pipeline been growing and be capability. expense we've you've Asset will significant year the remarks. opportunity through prepared growth about that then term the well. my base we'll

Services, real the we're well terms services for markets, border cross [decan] payments. that the In about CCM, expect I lending that we picking from and term term. In we're term, and Treasury triparty, and time exchange and So the up again, with the liquidity and dollar activity driving playing it’s repo of foreign longer which products. think for. positioned we're something come for near for will with the new to In medium granular then US in into term medium execution clearing and we're talked the securities we evolution for

many so we're and of so across near the them And our got for later. businesses, opportunities in executing we’ve focused term, we're investing on

question from comes Rob next Our Wildhack.

about XXXX. wanted to the noninterest the to quarter-over-quarter. outflow the saw there. deposits growth. bearing what are for on bearing little bit Wondering in you And that more quarter. flipped what I appreciate ask color the deposits Interest accelerated side, a drivers I on

on So either would more color great. any those of be

runoff So as And nonoperational deposit are and the that overall were NIBs was balances still modestly you at remaining very see. most for in levels. did can but a of down elevated quarter

it's trajectory what for XXXX. for worth just talking So when deposits about in the we're

quarter deposits to you majority modestly I in As average. XX% revert to the probably single to should total really seen our before, as XX%, it call we've from decline would we of low large from we that and are very of historical will back be averages balances said average fourth expecting they deposit expect about NIBs digits and because expect

a sometimes this Robin, priority healthy then, difficult asset you be in established, That's servicing to growth And that's as business year. can a highlighted differentiate. for more well

to you growth what So of can accelerate the kinds are and to you do things do there? want

component going then it in some and to I'm different conversation that. from that year of traction firms, we and remarks to a over And getting there all going prepared business for earlier days going see -- that it on are where C-suite are see isolated We she sale. that of prior good the had opportunities a we're think in or on these really well basis, but time. -- it. that up run opportunities with one, in this type a to start an because her mentioned that knows to Emily, in a very on a we last deals to the client is of package from that Well, sell gone us. is we new off we But because I'm service of digital capabilities, wrapped we're example variety data more selling pretty year, the already bundled really my small are more significant elevating I of the of into announced I give

So that's one thing.

to in is We also to acceptable will that we at some from business. and top efficient we've invest the business and that continue have made in focus. margin to continue the want in benefit will line cheaper I cost that line, that of the comments the not making and both point before you more that rates execution investing bottom the and

package of it's want all you I don't a So the Emily, know, to things. of if add. really

to things Just a few add.

in and his I the alluded value and mandate winning mean, also So are Robin larger as very on focused we remarks, of profitability to overall. we're relationship higher yields, prepared the the but

our on focused the the pipeline thing, manually forward -- as and wins also segment, say we are very especially I even And the participate driving ETFs. we're very in inclusive Security mentioned, down have remain we to we that data course, our had data [indiscernible] Services areas And seen like other so pretty would of Likewise RFPs those means intensive. strong. were being the very more servicing is asset is that of very, which for we're critical, of and across XX% higher into in that selective Robin the trajectory the clients. cost growth in. And leaning off is component a businesses,

agency, transfer accounting. think think fund So

So there's sure. opportunity for there

Steven next from question comes Our Chubak.

no about early whether his cohort, I'm there recognizing you We the evolving? capital on the could have on or Emily, still 'XX. the capital going I in had future III, but Basel ago, proposal, IV. proposal. how hoping cadence influence of higher to you’re scenario had see finalization more something planning question hinted for you months was is coming at roughly for to moving But any is how So just has speech don't asked XX G-SIB management ask still given speak know the a earnings broadly, call requirements Basel just you we buybacks potentially that of the I that potential And

the around industry involved regulators obviously in Basel very So around IV. conversations the with we're true. It's look,

RWA some offset also Of course, approach a for the what the operational crunch numbers, aggregate less G-SIB’s or into something drive the -- we are you've introduction also standardized there going for be And our there seen us. expect by itself, we in than increase are probably bit do the the our RWAs. talks standardized QIS. to When an of in risk suggest would, operating

sensitive a So sensitive probably to RWAs market risk from credit more lower and also benefit risk market modestly more risk framework. we’ll

So us, takes. do we proposed release -- RWA already We'll their have puts we always for optimization. version. they'll until we're the and be looking obviously wait really And to at regulators --

that -- can industry you, ongoing being. to into came that have have doing. too, in optimization been that the that's RWAs results ongoing You down actually will quarter, whatever up been end remind And just see I again, the time leg would from the we and we've

plan, quarters. realize drive up and other [op] as guidance expenses. implies level both expense reconcile the the margin on of actions, fruit, to it just Security hanging should improve follow think to reflect it expense will, over the was there's expense should second most of course steadily that for growth? segment and efficiency about to exit implement like of year, low derivative that efficiency given And we just where the my the area we the on lower 'XX relative still dollars for for specifically, where expect feels if growth And 'XX to some I of therefore, the you relates the start you of some benefits can the us expenses, planned expense what you the hoping you the the help in how Should Services that's to rate a for gains.

services, think for to security been So really very for KPI are I'll XX-plus what because very medium kind focused margin of that's critical a answer already is on Robin we've that term. committed I said, And more over us. we the a percent margin about talking

NIR. somewhat XX% You'll we to fourth year, see benefit quarter for of the that from In XX%. full will XXXX, printed in we was the margin closer about

rates well decline Also, will be issuer absolutely NIBs. perhaps nonrecurring that as going revenue initiatives in offset to we have against that a won't on enjoyed been XXXX have mention, services, the services particular. higher we talking as are efficiency partially about. executing by in security focused we activity the XXXX extraordinarily modest When I'd So though, in you in think some also about just that there's in we growth

certainly QX security So but overall, putting than be what they're services when it we kind than at for margins printed going the all in you year higher together, full of to level. net-net, look the lower

progress. making we're So

think expense how wide additional some you efficiency that rate year. benefits exit we trying of reflect the cadence the course those 'XX trajectory just the the about basis, cited. I'm to the the had for should just should about growth of whether And firm for think expense over

for of due that year. retirement see comp going quarter-on-quarter. the So higher employees. give front you first with to say expect bit but on of I staff guys are the we're expenses thing term I a mean loaded that over I'm quarter, the know actions and kind typically eligible incentive not you'll they're associated of we the long this to detail just taking, is what of would course, the only all much And too -- course

So I would the back we are to, go absolutely just think curve. I bending cost

year-on-year deliver X% are to in to growth X.X% about currency that to XXXX. expecting committed We constant and again, very compares deliver are and X%, of

comes Our Mike Mayo. from next question

think a hand tough Robin, inherited here. you I

mean they implies last quarter. with line your for typically X% were controlling BNY has periods with Looks off guide top of flat historically when coincides here, Mellon NII So you're expenses, starting do but that the I job had periods a better fourth down slower growth, like year. that's fees but

okay, about so not they're -- you or So much, slow revenues they've are expenses control it's to. already can slow, much so

to Robin, items savings or But when to decade, add it but notable almost going to items worth seems up are comes like year's of onetime earnings. part some over if billion, had that's that, efficiency notable you, this quarter. a a you of it be this as you So And items, just predates your $X.X your tougher. look

and efficiency and margin of pressures. is here your when question Mellon profit the you more been real the have you how improve out So environment BNY ratio your inflationary has revenue can tough and squeeze

are So a you terms I leverage basis? this of in positive guess turn core the confident on around operating how to

people just has how past Mike, reflecting performance. terms company's done on they've in our in we what been decade done and I'll broad without say So acknowledge the terms have financial it, the of that disappointing that past of

performance some Board talked it, line, to You not but your about about on comfortable can top look employees that's our spot, how decade. pick it, that's how we're the line of to talk change the at spots the broad our we're bottom with the to past we've company determined expenses, we the and that. over And we

from And so think, I a outcome. us, hearing you're hope, I around determination changing that

that of talked Now the really question, about. to let two the take things parts me your you've

items. So first notable all, the of

release we first. clear, we in so very And this and GAAP we our earnings it we in do do our and talk very, remarks, prepared are

of numbers into you So and clear can insight that is give also the you'll but that us element judgment on your running additional hood. we're reported you we're we provide. think and transparency the helpful, the way the see frankly, it's on want but disclosure can that very trying make the why and And we you to judge company the to based transparency, that the under that's and insights that

XXXX. We're thing do, variety it's we've my we're environment because deliberate -- currency, that in the for and on inflation cultural use few what it. of But the choices view, those to the we're course months, was that staffing, of past prepared still terms half own we've X.X% that's in it do bending as got to an fronts. a X%, our exit I and curve, think all if point isn't I had in essentially employees a cost better. CPI X% X inflation us basis, over remarks attacking We the things been change, Now of and change X.X% get to going currency And well. that X to environment. choices how it and on -- the between any of of constant expected from of I of number, to talked very rate a involving going of about of

we've those well, holds, done things the stop the all question future Now once of we're of of to all we We we see the to don't opportunities. don't the but think to want future, there. do things going implied line in do what sight of we have to that

because time, at we'd and have otherwise, company. We to opportunities. finish, always we're order make the rightly now and wrapped sure solve the loan in things multiple systems. to work We've we just leg finite we'll services. stuff. so, us custodian products a we we the We've I'm up largest resolve I'll the place then Resiliency once then is to in resiliency system. a than in that problems, and our seeing But is in largely we ourselves It's our of more our the have applications, we've took like we've of years on the For these do got a got the continuous going and do going and world's instance, expense bandwidth. important that. as got really where digitization five to brand ton over But issues. incredibly invested one and which to technology. all we all it It's ago, And centers for were five in but journey. We're but to next better so on one base custody wanted different than do can't only spike to We've is the a investing footprint. pick done call

continue through So it and working we're it. we'll through to work

what share over be That can metrics and you your if are. time targets would great those of more

The growth other your have part is of you initiatives. that four said you --

any endgame, recent meat or mention post as metrics put something digital as to growth and get the assets did debacle. more on it's to initiatives. your just put far -- eventually concrete Can one revenues this more key to like four what’s of you'd where the bones on You you the or

color. Just a little more bit

haven't point of it over of view look mentioned the negligible them we much longest I which well. for after company. But next aren't after, that of interesting there's but it at is I associated play Those out are quoting. other after us time. the largest mentioned, you're prominence things, about. four because to But stuff. the to, next in If custodian, the want have in to pick five I and good they of might And way to after assets, the make trillion the great be the years. just have different that if only look be I to about initiatives stuff, least of stuff. a $XX from out we’ve of the world's and the stuff revenue should to comment think things very But growth technology the which as them and that be we the talked look couple the we examples worth be going in digital they're one representative it. they're things with in So timelines are looking the and I over to looking things any changes, point of years, business that of for that as that. about We business given adapt after new there to could course the haven't as it's be term specifically we expect I different negligible

ago to for we with not us. will XX be like the sticking years But come so to if come being to investing a it be, not it does adopting computer, be there. that be, and And would a we're may probably future have not. to but going be It that's and custodian of paper

it's being broader measured. in it's different and of we participate being and for we're the do in So But space. the investing, company we've we're cautious, digital parts got think asset we're R&D to important deliberate us

Cassidy. Our next question Gerard comes from

deposits, noninterest a the Emily, than are normal. higher little mentioned on they bearing how you

XX%. could normal? -- think And so What's think them that keeping high? or of you but you you longer XX% year get up normal some to more I now to they higher see them deposits, they're to maybe you for drop remain do XX% real said expect trends to this total to back definitely said I second, levels, going do

And frankly, lot that. there around of a is uncertainty

generally NIBs, off high risk think more So they're behavior. relates as certainly elevated it probably to -- because look, we of they're some

our deposits. just mentioned really a we've our with gotten more deposits lot I that too thing other the in manage we and is The we how manage tools that sophisticated which

going XX% to and NIR And to mention So helpful you're the the our very also to those I'd do which I to revert to that only have they projection. cetera, there's thing Corporate to Asset example, elevated, in, look, think for something We I we've to extent XX%, right. will significant upside naturally Trust, mean about is the businesses it's growth well. et attract expect be NIBs remain as seen other but NIBs. that Servicing,

to are about obviously, that, your of I us is like thoughts. just all is not credit bank concerned get it based bank, a a would quality. than guys' We any know fee bank your But

Bank a nothing closely it, are expectation nobody about book seeing provision recession to any watching a really you just ago? And increase, the in I more XX York's whatever guys call quality. slowdown, trends the small loan or with emphasize little again, material. today credit a You you than maybe concerned soft a again, But of of want you're had months is New that

alluded portfolio I you've of reminder, quality think a it. as already The very our remains and just So to high.

A-minus, moment, closely NPLs investment of the it is CRE but only delinquencies and At XX%, collections high that the The over So rating particular. of and stable. occupancy are an that, weighted to. the we're and course, grade closer segment portion A, is portfolio monitoring the office we're area remain paying of is average attention rent very in area

loan is the of Emily? that what of the book And percentage about, CRE

about loans. X% funded It's of the

Our from Ken comes next question Usdin

Servicing. for just the you Robin, to thoughts earlier know some increase and on general I fees about view Asset talked

the movement organic if And what Just fourth in of quarter also, also like? specifically have a think growth in some on you Collateral to in see just nice Pershing wondering can the look Management. view you and it's --

those now if on well. two wondering areas what for is a as Just you the thumb have outlook

the forgetting overall over fees focused from tackling we ways are of this of internal and the point course view, we So M&A just grow, the other blocking do of or those growth execution an what the in about can on company of and we to think any year.

on we've There haven't for things that -- We Look, two internal given so what growth. businesses but just we us we, we guidance of market. those is are reasons are -- the course too for to, to puts and so many both bright think course, time. have which and for out where over the be budget, that's are you fee and the working there businesses going because through that in been are just our spots that Emily called we of alluded many takes those of are credible where

prospects would good about we've underlying variety would company. above And And be about the so reasons be. we that be the above we different expect of only of those quite two to they a that already. growth feel average average, the are They're the not talked for the but ones that the

of the means the fixed peak on quick just for get about on think is you book follow-up and terms start able Emily, then on mix floating one of we of here investments? regards your putting sheet get kind more And that rate front to the with rate of the the you balance terms changing there that from that one how mix. yields types to you towards that cycle, in anything in securities you're type about what versus of of add the whether thinking as

a lot there. there's So in

rates, portfolio. our terms nimble continue managing higher and been to line we've positioned right benefit very from just very nimble be look, now, in we're of I’d but to So Bottom that the of its duration to the portfolio been in memory in is the attention the for everyone's available and our sale. of call shortest recent is portfolio XX% more fact than

guess as to see I investment asset resets the the said, to off much So you security how is can exceed in the And of just retained relates -- about the years. in a and two it rates. quarter. that points of change. you was second lot of the environment reinvestment XX% yields, the I the of is is flexibility excluding has XXXX about range should we or roll to and very basis really as any securities think The it And at duration, that ultimately began difference can when swiftly the believe, in the three portfolio second XX%, time, the steadily expanded XXX quarter, we've act between about moment it in portfolio I securities [rate] assets fixed

math can you of So there. kind the do

And our Brown. final Michael question from come will

kind as further my was question the is guess them XXXX, have out we answered. about and cuts occur I of rate Most before been some could end. think so assuming of market year into

to we see it's to some do that if heading pricing point, view Because guess deposit early we get way there, how betas generally not we're rate on where the that you expectation to higher the to on were your how we -- right? system Because your in the an performs is it point As I deposit up, back what that cuts? backdrop if about just were, where get rate banking modest than some broader cuts. start we think

So how in pricing the deposit about think environment? do that you

on as pricing the way expect we deposit similarly perform down way to up. on the So it do did

benefit, we start also to costs quickly. the start faster. should because likewise, deposit get course, down, come that then very to And [par] down will -- benefit rates pull get remind we'll our down AOCI rates to just of you the will So suddenly that extent I'll the the coming come

one just more then year full And guidance. the appreciate on annual NII,

As up you sequentially. about fourth it the XX% was look at quarter,

it's here trajectory. we the any moving guidance, a help on quarter? how annual view target, the I think us Within just to should range know any the think but about first about

very mentioned, the of range I As is wide. outcomes

very trajectory most really if remain it's probably And So said, in It I quarter. dependent, NIBs the trajectory. hard deposit any really is like there's elevated, to predict the upside on there. given specifically

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

are I'd looking franchise. the congratulate up He And client for and of his CFO, Xst all he's McDonough, in on Mellon Thank know, him taking CFO you running. growth us earnings in today's and call of call like be our a with of our team. as I by joined BNY February hit finally, driving to going role brings know as this her largest in first the time thanking her close our Dermot you, invaluable next to profitable forward starting November new and April. relationships CEO to to business. to that are welcome as our that experiences Servicing, role, her Emily you which to ground is operator. the to Emily like I'd Asset set

like So you for any with out Mellon. follow-up interest Be questions, that, you thank in Marius if your please And to I'd to have well. IR the reach and team. BNY

you. Thank

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