The Bank of New York Mellon(BK) - 2025 Q1 - Quarterly Report

Financial Performance - Net income applicable to common shareholders for Q1 2025 was $1,149 million, or $1.58 per diluted common share, compared to $953 million, or $1.25 per diluted common share in Q1 2024, reflecting a notable increase [18]. - Total revenue increased by 6% year-over-year, driven by an 11% increase in net interest income and a 3% increase in fee revenue [21]. - Total revenue for Q1 2025 was $2.3 billion, an increase of 8% compared to Q1 2024, but a decrease of 1% from Q4 2024 [71]. - Total revenue for Q1 2025 was $1.686 billion, an increase of 11% compared to Q1 2024 and 1% compared to Q4 2024 [85]. - Total revenue for Q1 2025 was $779 million, a decrease of 8% compared to Q1 2024 and 11% compared to Q4 2024 [98]. Assets and Management - Assets under custody and/or administration (AUC/A) reached $53.1 trillion, a 9% increase compared to $48.8 trillion in Q1 2024, primarily due to client inflows and higher market values [28]. - Assets Under Custody/Administration (AUC/A) reached $38.1 trillion, reflecting an 8% increase year-over-year due to higher market values and client inflows [70]. - Assets Under Management (AUM) remained flat at $2.0 trillion, reflecting higher market values offset by cumulative net outflows [31]. - Assets Under Management (AUM) totaled $2.0 trillion as of March 31, 2025, flat compared to March 31, 2024, due to higher market values offset by cumulative net outflows [96]. Revenue Sources - Fee revenue as a percentage of total revenue was 71% in Q1 2025, down from 73% in Q1 2024 [22]. - Investment services fees increased by 6% year-over-year, driven by net new business and higher client activity [27]. - Financing-related fees increased by 5% compared to Q1 2024, primarily due to higher loan commitment fees [33]. - Investment services fees totaled $1.074 billion, down 1% from Q4 2024 but up 8% from Q1 2024 [84]. - Treasury Services revenue increased to $477 million, reflecting a 15% increase year-over-year [87]. - Clearance and Collateral Management revenue was $490 million, up 14% from Q1 2024 [88]. Expenses and Costs - Total noninterest expense for Q1 2025 was $3,252 million, a decrease of 3% from Q4 2024 and an increase of 2% from Q1 2024, primarily due to efficiency savings [48][49]. - Noninterest expense for Q1 2025 was $1.6 billion, up 3% from Q1 2024, primarily due to higher investments and employee merit increases [75]. - Noninterest expense rose to $866 million, a 4% increase compared to Q1 2024 [89]. - The allowance for credit losses increased to $401 million at March 31, 2025, from $392 million at Dec. 31, 2024, with a provision for credit losses of $18 million in Q1 2025 [167][168]. Tax and Equity - The effective tax rate was 19.7%, influenced by a tax benefit from the annual vesting of stock awards [21]. - BNY recorded an income tax provision of $300 million with a 19.7% effective tax rate in Q1 2025, compared to $297 million (22.4%) in Q1 2024 and $315 million (21.4%) in Q4 2024 [51]. - The company returned $1.1 billion to common shareholders, including $746 million in common share repurchases [21]. - Total shareholders' equity increased to $43 billion at March 31, 2025, from $41 billion at December 31, 2024 [119]. Loans and Deposits - Average loans decreased by 2% to $11.3 billion in Q1 2025 compared to Q4 2024, while average deposits decreased by 3% to $175.9 billion [61]. - Total loans at period end were $71.404 billion, slightly down from $71.570 billion at Dec. 31, 2024 [167]. - Average deposits were $91.905 billion, up 3% from Q1 2024 [86]. - Total deposits rose to $309 billion at March 31, 2025, compared to $290 billion at December 31, 2024, reflecting an increase in interest-bearing deposits [115]. Risk and Exposure - The company is monitoring its exposure to higher risk countries, including Brazil and Russia, with specific strategies in place to manage these risks [123][124]. - The top 10 country exposure accounted for 65% of total non-U.S. exposure, with Germany and the UK being the largest exposures at $21.2 billion and $19.2 billion, respectively [121][122]. - Nonperforming assets rose to $213 million at March 31, 2025, up from $179 million at Dec. 31, 2024, resulting in a nonperforming assets ratio of 0.30% [175]. Capital and Liquidity - Total consolidated high-quality liquid assets (HQLA) increased to $202 billion as of March 31, 2025, from $182 billion at December 31, 2024 [208]. - The average consolidated liquidity coverage ratio (LCR) was 116% for Q1 2025, compliant with U.S. regulatory requirements [209]. - The average consolidated net stable funding ratio (NSFR) was 132% for Q1 2025, also compliant with regulatory requirements [210]. - In April 2025, the Bank issued $2.5 billion of debt in three tranches, indicating ongoing capital market activity [198].