By Michael Calia And Angela Chen
Bank of New York Mellon Corp. said higher foreign exchange
revenue and equity market values were unable to offset lower
performance fees and losses in fixed-income, as the bank posted
weaker-than-expected results in the fourth quarter.
The bank, which acts as an investment manager while safeguarding
trillions of dollars for money managers and other clients, posted a
profit of $807 million, up from $513 million in the prior-year
period. On a per-share basis, earnings rose to 70 cents from 44
cents.
Excluding certain items such as tax benefits and restructuring
stages, the bank posted earnings of 58 cents a share, up from 54
cents a share.
Revenue improved about 2% to $3.69 billion.
Analysts had recently projected 59 cents a share in earnings and
$3.81 billion in revenue, according to Thomson Reuters.
BNY Mellon said its net interest margin, a key measure of
lending profitability, declined to 0.91% from 1.09% in the same
period a year ago. Accordingly, net interest income slid 6%.
Total fees and other revenue grew 4.3% to $2.94 billion.
Foreign exchange revenue totaled $151 million, up from $146
million a year ago. However, other trading saw a loss of $14
million, compared with revenue of $20 million the year earlier.
This is primarily due to lower fixed-income revenue due to exiting
the derivatives business.
The bank said last month that it would give a board seat to
Nelson Peltz's Trian Fund Management LP. The firm has privately
pushed BNY Mellon to cut costs, The Wall Street Journal previously
reported.
Rivals Northern Trust Corp. and State Street Corp. have reported
profits that beat expectations for the fourth quarter.
Shares of BNY, inactive premarket, are up about 17% in the past
12 months through Thursday's close.
Write to Michael Calia at michael.calia@wsj.com and Angela Chen
at angela.chen@dowjones.com
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