2023-04-18 09:44:01 ET
Bank of New York Mellon ( NYSE: BK ) on Tuesday posted Q1 results largely in line with expectations, as higher interest rates fueled net interest revenue growth, but lower market values weighed on fee income.
Shares of BNY Mellon ( BK ) -1.2% in early trade.
The investment bank reported Q1 adj. EPS of $1.13 vs. $1.11 consensus and $0.86 in Q1 2022. Revenue grew 12% Y/Y to $4.4B, in line with estimates.
Fee revenue totaled $3.16B, down 2% sequentially and flat Y/Y, reflecting abatement of money market fee waivers, offset by lower market values, unfavorable impact of a stronger U.S. dollar and impact of the Alcentra divestiture.
Net interest revenue was $1.13B, up 6.8% Q/Q and up 61.6% Y/Y, reflecting higher interest rates, partially offset by higher funding expense.
Noninterest expense rose 3% Y/Y to $3.1B on higher investments and revenue-related expenses, as well as impact of inflation.
Total deposits, a closely watched metric in the wake of recent banking turmoil, ticked up 0.8% from the prior quarter to $281.29B, but declined 18.6% Y/Y. Average deposits stood at $274B, down 3% from Q4 and down 13% Y/Y.
Assets under management totaled $1.9T, down 16% Y/Y hurt by market impact, but rose 4% from the end of Q4.
BNY Mellon ( BK ) also declared a $0.37 quarterly dividend.
Prior to the bank's earnings, SA contributor Mike Zaccardi reviewed the stock, which he said was near its fair value.
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Bank of New York Mellon posts in-line Q1 earnings; lower market values drag fee income