Equibles

8-K

Bank of New York Mellon Corp (BK)

8-K 2024-03-26 For: 2024-03-26
View Original
Added on April 09, 2026

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) – March 26, 2024

THE BANK OF NEW YORK MELLON CORPORATION

(Exact name of registrant as specified in its charter)

Delaware 001-35651 13-2614959
(State or other jurisdiction <br>of incorporation) (Commission <br>File Number) (I.R.S. Employer <br>Identification No.)

240 Greenwich Street

New York, New York 10286

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code – (212) 495-1784

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐    Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐    Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐    Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐    Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class Trading <br>symbol(s) Name of each exchange<br>on which registered
Common Stock, $0.01 par value BK New York Stock Exchange
6.244% Fixed-to-Floating Rate Normal Preferred Capital Securities of Mellon Capital IV BK/P New York Stock Exchange
(fully and unconditionally guaranteed by The Bank of New York Mellon Corporation)

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 under the Securities Act (17 CFR 230.405) or Rule 12b-2 under the Exchange Act (17 CFR 240.12b-2).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

ITEM 8.01.    OTHER EVENTS.

The Bank of New York Mellon Corporation (the “Company”) is filing this Current Report on Form 8-K to provide supplemental financial disclosure related to (i) the Company’s adoption on Jan. 1, 2024 of Accounting Standards Update (“ASU”) 2023-02, Accounting for Investments in Tax Credit Structures Using the Proportional Amortization Method, on a retrospective basis for the Company’s investments in renewable energy projects that have met the eligibility criteria and (ii) certain realignments of similar products and services reported within the Company’s lines of business, which became effective in the first quarter of 2024.

Exhibit 99.1 contains historical quarterly business segment financial data revised to reflect the aforementioned developments for the quarter ended Dec. 31, 2022, the quarters ended March 31, June 30, Sept. 30 and Dec. 31, 2023 and the full years ended Dec. 31, 2022 and Dec. 31, 2023. The realignments within the lines of business did not impact the previously reported consolidated financial results of the Company. The adoption of ASU 2023-02 had an impact on investment and other revenue and on provision for income taxes on the Company’s consolidated income statement but did not materially impact the consolidated net income or earnings per share for the years ended Dec. 31, 2022 and Dec. 31, 2023.

Exhibit 99.1 is incorporated by reference into this Item 8.01.

ITEM 9.01.    FINANCIAL STATEMENTS AND EXHIBITS.

(d)    EXHIBITS.

Exhibit
Number Description
99.1 Revised Financial Supplement – Adoption of New Accounting Guidance and Certain Business Realignments
104 Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

The Bank of New York Mellon Corporation<br><br>(Registrant)
Date: March 26, 2024 By: /s/ Jean Weng
Name: Jean Weng<br>Title: Secretary

Document

Exhibit 99.1

bnym_logox3.jpg

The Bank of New York Mellon Corporation
Revised Financial Supplement
(Adoption of New Accounting Guidance and<br>Certain Business Realignments)
Five Quarter Trend Through 4Q23
and Full Years 2023 and 2022
Table of Contents
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Page
Adoption of New Accounting Guidance and Certain Business Realignments 3
Restatements to Reflect Adoption of New Accounting Guidance 4
Reclassifications to Reflect Certain Business Realignments 6
Consolidated Results
Consolidated Financial Highlights 8
Condensed Consolidated Income Statement 9
Condensed Consolidated Balance Sheet 10
Fee and Other Revenue 11
Average Balances and Interest Rates 12
Capital and Liquidity 13
Business Segment Results
Securities Services Business Segment 14
Market and Wealth Services Business Segment 16
Investment and Wealth Management Business Segment 18
AUM by Product Type, Changes in AUM and Wealth Management Client Assets 19
Other Segment 20
Other
Securities Portfolio 21
Allowance for Credit Losses and Nonperforming Assets 22
Supplemental Information
Explanation of GAAP and Non-GAAP Financial Measures 23
THE BANK OF NEW YORK MELLON CORPORATION
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ADOPTION OF NEW ACCOUNTING GUIDANCE AND CERTAIN BUSINESS REALIGNMENTS
The following disclosures reflect the restatement of prior period financial information to reflect the impact of the retrospective application of new accounting guidance. On Jan. 1, 2024, we adopted Accounting Standards Update (“ASU”) 2023-02, Investments—Equity Method and Joint Ventures (Topic 323): Accounting for Investments in Tax Credit Structures Using the Proportional Amortization Method on a retrospective basis for our investments in renewable energy projects that have met the eligibility criteria. The impact of adopting this guidance increased investment and other revenue and the provision for income taxes on the consolidated income statement. The results of our investments in renewable energy projects are included in the Other segment.
In the first quarter of 2024, we also made certain realignments of similar products and services within our lines of business consistent with the firm’s ongoing transition to a platforms operating model uniting related capabilities and enabling streamlining of internal processes to drive growth, efficiency, resiliency, and enhanced risk management. The largest change was the movement of Institutional Solutions from Pershing to Clearance and Collateral Management, both in the Market and Wealth Services business segment. We made other smaller changes that moved activity from Asset Servicing in the Securities Services business segment to Treasury Services in the Market and Wealth Services business segment, and from Wealth Management in the Investment and Wealth Management business segment and Pershing in the Market and Wealth Services business segment to Investment Management in the Investment and Wealth Management business segment. The following disclosures provide detailed reclassified financial information to assist investors in understanding how the business segment results would have been presented in previously filed reports. The Other segment was not impacted by the changes.
This exhibit also reflects the subsequent event reflected in our Annual Report on Form 10-K for the year ended Dec. 31, 2023 filed on Feb. 28, 2024 whereby we included an additional $127 million pre-tax ($97 million after-tax) increase in noninterest expense related to a revised estimate of the FDIC special assessment for the fourth quarter and full year ended Dec. 31, 2023 as a result of new information published by the FDIC in February 2024.
Cautionary Statement on Forward-Looking Statements
Certain statements in this Financial Supplement may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including statements about our strategic priorities and transition to a platforms operating model. Forward-looking statements are not guarantees of future results or occurrences, are inherently uncertain and are based upon current beliefs and expectations of future events, many of which are, by their nature, difficult to predict, outside of our control and subject to change.
By identifying these statements for you in this manner, we are alerting you to the possibility that our actual results may differ, possibly materially, from the anticipated results expressed or implied in these forward-looking statements as a result of a number of important factors, including the risk factors and other uncertainties set forth in our Annual Report on Form 10-K for the year ended Dec. 31, 2023 and our other filings with the Securities and Exchange Commission.
You should not place undue reliance on any forward-looking statement. All forward-looking statements speak only as of the date on which they were made, and we undertake no obligation to update any forward-looking statement to reflect events or circumstances after such date or to reflect the occurrence of unanticipated events.
THE BANK OF NEW YORK MELLON CORPORATION bnym_logox3.jpg
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RESTATEMENTS TO REFLECT ADOPTION OF NEW ACCOUNTING GUIDANCE
The following tables disclose the impact to the financial statements from the retrospective adoption of ASU 2023-02, Investments—Equity Method and Joint Ventures (Topic 323): Accounting for Investments in Tax Credit Structures Using the Proportional Amortization Method for our investments in renewable energy projects that have met the eligibility criteria.
Impact to the Consolidated Income Statement Quarters Full years
(dollars in millions, except per share amounts) 4Q23 3Q23 2Q23 1Q23 4Q22 FY23 FY22
Investment and other revenue - previously reported $ (4) $ 113 $ 97 $ 79 $ (360) $ 285 $ (82)
Impact of adopting ASU 2023-02 47 46 50 52 28 195 152
Investment and other revenue $ 43 $ 159 $ 147 $ 131 $ (332) $ 480 $ 70
Total revenue - previously reported $ 4,311 $ 4,374 $ 4,454 $ 4,363 $ 3,918 $ 17,502 $ 16,377
Impact of adopting ASU 2023-02 47 46 50 52 28 195 152
Total revenue $ 4,358 $ 4,420 $ 4,504 $ 4,415 $ 3,946 $ 17,697 $ 16,529
Income before income taxes - previously reported $ 232 $ 1,282 $ 1,338 $ 1,236 $ 685 $ 4,088 $ 3,328
Impact of adopting ASU 2023-02 47 46 50 52 28 195 152
Income before income taxes $ 279 $ 1,328 $ 1,388 $ 1,288 $ 713 $ 4,283 $ 3,480
Provision for income taxes - previously reported $ 29 $ 241 $ 270 $ 260 $ 142 $ 800 $ 768
Impact of adopting ASU 2023-02 44 44 45 46 37 179 169
Provision for income taxes $ 73 $ 285 $ 315 $ 306 $ 179 $ 979 $ 937
Net income - previously reported $ 203 $ 1,041 $ 1,068 $ 976 $ 543 $ 3,288 $ 2,560
Impact of adopting ASU 2023-02 3 2 5 6 (9) 16 (17)
Net income $ 206 $ 1,043 $ 1,073 $ 982 $ 534 $ 3,304 $ 2,543
Net income applicable to common shareholders of <br>The Bank of New York Mellon Corporation - previously reported $ 159 $ 956 $ 1,031 $ 905 $ 509 $ 3,051 $ 2,362
Impact of adopting ASU 2023-02 3 2 5 6 (9) 16 (17)
Net income applicable to common shareholders of <br>The Bank of New York Mellon Corporation $ 162 $ 958 $ 1,036 $ 911 $ 500 $ 3,067 $ 2,345
Earnings per common share (Basic) - previously reported $ 0.21 $ 1.23 $ 1.31 $ 1.13 $ 0.63 $ 3.89 $ 2.91
Impact of adopting ASU 2023-02 — — 0.01 0.01 (0.01) 0.02 (0.02)
Earnings per common share (Basic) $ 0.21 $ 1.23 $ 1.32 $ 1.13 (a) $ 0.62 $ 3.91 $ 2.89
Earnings per common share (Diluted) - previously reported $ 0.21 $ 1.22 $ 1.30 $ 1.12 $ 0.62 $ 3.87 $ 2.90
Impact of adopting ASU 2023-02 — — 0.01 0.01 (0.01) 0.02 (0.02)
Earnings per common share (Diluted) $ 0.21 $ 1.23 (a) $ 1.31 $ 1.13 $ 0.61 $ 3.89 $ 2.88
(a) Does not foot due to rounding.
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RESTATEMENTS TO REFLECT ADOPTION OF NEW ACCOUNTING GUIDANCE
Impact to the Consolidated Balance Sheet 2023 2022
(dollars in millions) Dec. 31 Sept. 30 June 30 March 31 Dec. 31
Other assets - previously reported $ 25,985 $ 25,231 $ 25,656 $ 27,335 $ 25,855
Impact of adopting ASU 2023-02 (76) (196) (201) (213) (223)
Other assets $ 25,909 $ 25,035 $ 25,455 $ 27,122 $ 25,632
Total assets - previously reported $ 409,953 $ 405,248 $ 430,382 $ 425,112 $ 405,783
Impact of adopting ASU 2023-02 (76) (196) (201) (213) (223)
Total assets $ 409,877 $ 405,052 $ 430,181 $ 424,899 $ 405,560
Accrued taxes and other expenses - previously reported $ 5,567 $ 5,389 $ 5,160 $ 4,732 $ 5,410
Impact of adopting ASU 2023-02 (156) (164) (174) (184) (195)
Accrued taxes and other expenses $ 5,411 $ 5,225 $ 4,986 $ 4,548 $ 5,215
Other liabilities - previously reported $ 8,844 $ 11,758 $ 9,553 $ 10,414 $ 8,543
Impact of adopting ASU 2023-02 184 76 82 86 93
Other liabilities $ 9,028 $ 11,834 $ 9,635 $ 10,500 $ 8,636
Total liabilities - previously reported $ 368,944 $ 364,117 $ 389,280 $ 384,310 $ 364,933
Impact of adopting ASU 2023-02 28 (88) (92) (98) (102)
Total liabilities $ 368,972 $ 364,029 $ 389,188 $ 384,212 $ 364,831
Retained earnings - previously reported $ 39,653 $ 39,822 $ 39,199 $ 38,465 $ 37,864
Impact of adopting ASU 2023-02 (104) (108) (109) (115) (121)
Retained earnings $ 39,549 $ 39,714 $ 39,090 $ 38,350 $ 37,743
Total The Bank of New York Mellon Corporation shareholders’ equity - previously reported $ 40,874 $ 40,966 $ 40,933 $ 40,634 $ 40,734
Impact of adopting ASU 2023-02 (104) (108) (109) (115) (121)
Total The Bank of New York Mellon Corporation shareholders’ equity $ 40,770 $ 40,858 $ 40,824 $ 40,519 $ 40,613
THE BANK OF NEW YORK MELLON CORPORATION bnym_logox3.jpg
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RECLASSIFICATIONS TO REFLECT CERTAIN BUSINESS REALIGNMENTS
The following tables below disclose the impact to the business segments as a result of the business realignments.
Impact to the business segments Quarters Full years
(dollars in millions) 4Q23 3Q23 2Q23 1Q23 4Q22 FY23 FY22
Securities Services business segment
Investment services fees by line of business - previously reported $ 1,260 $ 1,265 $ 1,310 $ 1,184 $ 1,242 $ 5,019 $ 4,927
Impact of business reporting changes - Asset Servicing — (8) (11) (7) (6) (26) (30)
Total investment services fees $ 1,260 $ 1,257 $ 1,299 $ 1,177 $ 1,236 $ 4,993 $ 4,897
Total revenue by line of business - previously reported $ 2,179 $ 2,089 $ 2,240 $ 2,116 $ 2,172 $ 8,624 $ 8,032
Impact of business reporting changes - Asset Servicing — (8) (11) (7) (6) (26) (30)
Total revenue $ 2,179 $ 2,081 $ 2,229 $ 2,109 $ 2,166 $ 8,598 $ 8,002
Total noninterest expense - previously reported $ 1,653 $ 1,585 $ 1,582 $ 1,556 $ 1,576 $ 6,376 $ 6,299
Impact of business reporting changes — 13 (15) (16) (4) (18) (18)
Total noninterest expense $ 1,653 $ 1,598 $ 1,567 $ 1,540 $ 1,572 $ 6,358 $ 6,281
Income before income taxes - previously reported $ 462 $ 485 $ 642 $ 560 $ 585 $ 2,149 $ 1,725
Impact of business reporting changes — (21) 4 9 (2) (8) (12)
Income before income taxes $ 462 $ 464 $ 646 $ 569 $ 583 $ 2,141 $ 1,713
Market and Wealth Services business segment
Investment services fees by line of business - previously reported $ 973 $ 955 $ 933 $ 927 $ 921 $ 3,788 $ 3,568
Impact of business reporting changes:
Pershing (34) (28) (30) (30) (30) (122) (115)
Treasury Services — 8 11 7 6 26 30
Clearance and Collateral Management 34 28 30 30 30 122 115
Total investment services fees $ 973 $ 963 $ 944 $ 934 $ 927 $ 3,814 $ 3,598
Total revenue by line of business - previously reported $ 1,499 $ 1,445 $ 1,445 $ 1,467 $ 1,399 $ 5,856 $ 5,282
Impact of business reporting changes:
Pershing (42) (42) (45) (44) (43) (173) (207)
Treasury Services — 8 11 7 6 26 31
Clearance and Collateral Management 39 39 42 41 40 161 193
Total revenue $ 1,496 $ 1,450 $ 1,453 $ 1,471 $ 1,402 $ 5,870 $ 5,299
Total noninterest expense - previously reported $ 839 $ 808 $ 781 $ 769 $ 785 $ 3,197 $ 2,932
Impact of business reporting changes (2) (16) 13 13 (1) 8 4
Total noninterest expense $ 837 $ 792 $ 794 $ 782 $ 784 $ 3,205 $ 2,936
Income before income taxes - previously reported $ 632 $ 631 $ 657 $ 698 $ 608 $ 2,618 $ 2,343
Impact of business reporting changes (1) 21 (5) (9) 4 6 13
Income before income taxes $ 631 $ 652 $ 652 $ 689 $ 612 $ 2,624 $ 2,356
THE BANK OF NEW YORK MELLON CORPORATION bnym_logox3.jpg
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RECLASSIFICATIONS TO REFLECT CERTAIN BUSINESS REALIGNMENTS
Impact to the business segments Quarters Full years
(dollars in millions) 4Q23 3Q23 2Q23 1Q23 4Q22 FY23 FY22
Investment and Wealth Management business segment
Total revenue - previously reported $ 676 $ 827 $ 813 $ 827 $ 825 $ 3,143 $ 3,550
Impact of business reporting changes:
Investment Management 7 8 7 7 8 29 33
Wealth Management (4) (5) (4) (4) (5) (17) (20)
Total revenue $ 679 $ 830 $ 816 $ 830 $ 828 $ 3,155 $ 3,563
Total noninterest expense - previously reported $ 683 $ 672 $ 677 $ 734 $ 699 $ 2,766 $ 3,501
Impact of business reporting changes 2 3 2 3 4 10 14
Total noninterest expense $ 685 $ 675 $ 679 $ 737 $ 703 $ 2,776 $ 3,515
(Loss) income before income taxes - previously reported $ (5) $ 164 $ 129 $ 93 $ 125 $ 381 $ 48
Impact of business reporting changes 1 — 1 — (1) 2 (1)
(Loss) income before income taxes $ (4) $ 164 $ 130 $ 93 $ 124 $ 383 $ 47
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CONSOLIDATED FINANCIAL HIGHLIGHTS
(dollars in millions, except per common share amounts, or unless otherwise noted) 4Q23 vs. FY23 vs.
3Q23 2Q23 1Q23 4Q22 3Q23 4Q22 FY23 FY22 FY22
Selected income statement data
Fee and other revenue $ 3,257 $ 3,404 $ 3,404 $ 3,287 $ 2,890 (4) % 13 % $ 13,352 $ 13,025 3 %
Net interest income 1,101 1,016 1,100 1,128 1,056 8 4 4,345 3,504 24
Total revenue 4,358 4,420 4,504 4,415 3,946 (1) 10 17,697 16,529 7
Provision for credit losses 84 3 5 27 20 N/M N/M 119 39 N/M
Noninterest expense 3,995 3,089 3,111 3,100 3,213 29 24 13,295 13,010 2
Income before income taxes 279 1,328 1,388 1,288 713 (79) (61) 4,283 3,480 23
Provision for income taxes 73 285 315 306 179 (74) (59) 979 937 4
Net income $ 206 $ 1,043 $ 1,073 $ 982 $ 534 (80) % (61) % $ 3,304 $ 2,543 30 %
Net income applicable to common shareholders of The Bank of New York Mellon Corporation $ 162 $ 958 $ 1,036 $ 911 $ 500 (83) % (68) % $ 3,067 $ 2,345 31 %
Diluted earnings per common share $ 0.21 $ 1.23 $ 1.31 $ 1.13 $ 0.61 (83) % (66) % $ 3.89 $ 2.88 35 %
Average common shares and equivalents outstanding – diluted (in thousands) 772,102 781,781 790,725 807,718 815,846 (1) % (5) % 787,798 814,795 (3) %
Financial ratios (Quarterly returns are annualized)
Pre-tax operating margin 6 % 30 % 31 % 29 % 18 % 24 % 21 %
Return on common equity 1.8 % 10.6 % 11.7 % 10.4 % 5.6 % 8.6 % 6.5 %
Return on tangible common equity – Non-GAAP (a) 3.6 % 20.6 % 22.8 % 20.5 % 11.4 % 16.8 % 13.4 %
Non-U.S. revenue as a percentage of total revenue 36 % 36 % 36 % 34 % 38 % 36 % 36 %
Period end
Assets under custody and/or administration (“AUC/A”) (in trillions) (b) $ 47.8 $ 45.7 $ 46.9 $ 46.6 $ 44.3 5 % 8 %
Assets under management (“AUM”) (in trillions) $ 1.97 $ 1.82 $ 1.91 $ 1.91 $ 1.84 8 % 8 %
Full-time employees 53,400 53,600 53,200 51,600 51,700 — % 3 %
Book value per common share $ 47.97 $ 46.84 $ 46.21 $ 45.22 $ 44.25
Tangible book value per common share – Non-GAAP (a) $ 25.25 $ 24.52 $ 24.03 $ 23.38 $ 22.96
Cash dividends per common share $ 0.42 $ 0.42 $ 0.37 $ 0.37 $ 0.37
Common dividend payout ratio 202 % 35 % 29 % 33 % 61 %
Closing stock price per common share $ 52.05 $ 42.65 $ 44.52 $ 45.44 $ 45.52
Market capitalization $ 39,524 $ 32,801 $ 34,671 $ 35,858 $ 36,800
Common shares outstanding (in thousands) 759,344 769,073 778,782 789,134 808,445
Capital ratios at period end (c)
Common Equity Tier 1 ("CET1") ratio 11.5 % 11.3 % 11.0 % 10.9 % 11.1 %
Tier 1 capital ratio 14.2 % 14.3 % 14.0 % 13.9 % 14.1 %
Total capital ratio 14.9 % 15.2 % 14.8 % 14.7 % 14.9 %
Tier 1 leverage ratio 6.0 % 6.1 % 5.7 % 5.8 % 5.7 %
Supplementary leverage ratio ("SLR") 7.3 % 7.2 % 7.0 % 6.8 % 6.8 %
(a) Non-GAAP information, for all periods presented, excludes goodwill and intangible assets, net of deferred tax liabilities. See "Explanation of GAAP and Non-GAAP Financial Measures" beginning on page 23 for the reconciliation of Non-GAAP measures.
(b) Includes the AUC/A of CIBC Mellon Global Securities Services Company ("CIBC Mellon"), a joint venture with the Canadian Imperial Bank of Commerce, of 1.7 trillion at Dec. 31, 2023, 1.5 trillion at Sept. 30, 2023, 1.6 trillion at June 30, 2023 and 1.5 trillion at March 31, 2023 and Dec. 31, 2022.
(c) For our CET1, Tier 1 capital and Total capital ratios, our effective capital ratios under the U.S. capital rules are the lower of the ratios as calculated under the Standardized and Advanced Approaches, which for the periods presented, was the Advanced Approaches.
N/M – Not meaningful.

All values are in US Dollars.

THE BANK OF NEW YORK MELLON CORPORATION bnym_logox3.jpg
CONDENSED CONSOLIDATED INCOME STATEMENT
(dollars in millions, except per share amounts; common shares in thousands) 4Q23 vs. FY23 vs.
4Q23 3Q23 2Q23 1Q23 4Q22 3Q23 4Q22 FY23 FY22 FY22
Revenue
Investment services fees $ 2,242 $ 2,230 $ 2,252 $ 2,119 $ 2,173 1 % 3 % $ 8,843 $ 8,529 4 %
Investment management and performance fees 743 777 762 776 783 (4) (5) 3,058 3,299 (7)
Foreign exchange revenue 143 154 158 176 190 (7) (25) 631 822 (23)
Financing-related fees 45 45 50 52 43 — 5 192 175 10
Distribution and servicing fees 41 39 35 33 33 5 24 148 130 14
Total fee revenue 3,214 3,245 3,257 3,156 3,222 (1) — 12,872 12,955 (1)
Investment and other revenue 43 159 147 131 (332) N/M N/M 480 70 N/M
Total fee and other revenue 3,257 3,404 3,404 3,287 2,890 (4) 13 13,352 13,025 3
Net interest income 1,101 1,016 1,100 1,128 1,056 8 4 4,345 3,504 24
Total revenue 4,358 4,420 4,504 4,415 3,946 (1) 10 17,697 16,529 7
Provision for credit losses 84 3 5 27 20 N/M N/M 119 39 N/M
Noninterest expense
Staff 1,831 1,755 1,718 1,791 1,802 4 2 7,095 6,800 4
Software and equipment 486 452 450 429 432 8 13 1,817 1,657 10
Professional, legal and other purchased services 406 368 378 375 415 10 (2) 1,527 1,527 —
Net occupancy 162 140 121 119 143 16 13 542 514 5
Sub-custodian and clearing 117 121 119 118 112 (3) 4 475 485 (2)
Distribution and servicing 88 87 93 85 86 1 2 353 343 3
Bank assessment charges 670 37 41 40 19 N/M N/M 788 126 N/M
Business development 61 36 47 39 45 69 36 183 152 20
Goodwill impairment — — — — — N/M N/M — 680 N/M
Amortization of intangible assets 14 15 14 14 16 (7) (13) 57 67 (15)
Other 160 78 130 90 143 105 12 458 659 (31)
Total noninterest expense 3,995 3,089 3,111 3,100 3,213 29 24 13,295 13,010 2
Income before income taxes 279 1,328 1,388 1,288 713 (79) (61) 4,283 3,480 23
Provision for income taxes 73 285 315 306 179 (74) (59) 979 937 4
Net income 206 1,043 1,073 982 534 (80) (61) 3,304 2,543 30
Net loss (income) attributable to noncontrolling interests 2 (3) (1) — — N/M N/M (2) 13 N/M
Preferred stock dividends (46) (82) (36) (71) (34) N/M N/M (235) (211) N/M
Net income applicable to common shareholders of <br>The Bank of New York Mellon Corporation $ 162 $ 958 $ 1,036 $ 911 $ 500 (83) % (68) % $ 3,067 $ 2,345 31 %
Average common shares and equivalents outstanding: Basic 767,146 777,813 787,718 803,340 811,669 (1) % (5) % 784,069 811,068 (3) %
Diluted 772,102 781,781 790,725 807,718 815,846 (1) % (5) % 787,798 814,795 (3) %
Earnings per common share: Basic $ 0.21 $ 1.23 $ 1.32 $ 1.13 $ 0.62 (83) % (66) % $ 3.91 $ 2.89 35 %
Diluted $ 0.21 $ 1.23 $ 1.31 $ 1.13 $ 0.61 (83) % (66) % $ 3.89 $ 2.88 35 %
N/M – Not meaningful.
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CONDENSED CONSOLIDATED BALANCE SHEET
2023 2022
(in millions) Dec. 31 Sept. 30 June 30 March 31 Dec. 31
Assets
Cash and due from banks $ 4,922 $ 4,904 $ 5,720 $ 5,564 $ 5,030
Interest-bearing deposits with the Federal Reserve and other central banks 111,550 107,419 118,908 117,042 91,655
Interest-bearing deposits with banks 12,139 12,999 12,316 15,114 17,169
Federal funds sold and securities purchased under resale agreements 28,900 26,299 35,378 26,894 24,298
Securities 126,395 128,225 134,233 138,678 142,816
Trading assets 10,058 10,699 10,562 9,024 9,908
Loans 66,879 66,290 64,469 62,323 66,063
Allowance for loan losses (303) (211) (191) (170) (176)
Net loans 66,576 66,079 64,278 62,153 65,887
Premises and equipment 3,163 3,234 3,241 3,248 3,256
Accrued interest receivable 1,150 1,141 963 978 858
Goodwill 16,261 16,159 16,246 16,192 16,150
Intangible assets 2,854 2,859 2,881 2,890 2,901
Other assets 25,909 25,035 25,455 27,122 25,632
Total assets $ 409,877 $ 405,052 $ 430,181 $ 424,899 $ 405,560
Liabilities
Deposits $ 283,669 $ 277,467 $ 292,045 $ 281,294 $ 278,970
Federal funds purchased and securities sold under repurchase agreements 14,507 14,771 21,285 26,540 12,335
Trading liabilities 6,226 7,358 6,319 5,705 5,385
Payables to customers and broker-dealers 18,395 17,441 21,084 22,598 23,435
Other borrowed funds 479 728 1,371 2,538 397
Accrued taxes and other expenses 5,411 5,225 4,986 4,548 5,215
Other liabilities 9,028 11,834 9,635 10,500 8,636
Long-term debt 31,257 29,205 32,463 30,489 30,458
Total liabilities 368,972 364,029 389,188 384,212 364,831
Temporary equity
Redeemable noncontrolling interests 85 109 104 96 109
Permanent equity
Preferred stock 4,343 4,838 4,838 4,838 4,838
Common stock 14 14 14 14 14
Additional paid-in capital 28,908 28,793 28,726 28,650 28,508
Retained earnings 39,549 39,714 39,090 38,350 37,743
Accumulated other comprehensive loss, net of tax (4,893) (5,805) (5,602) (5,543) (5,966)
Less: Treasury stock, at cost (27,151) (26,696) (26,242) (25,790) (24,524)
Total The Bank of New York Mellon Corporation shareholders’ equity 40,770 40,858 40,824 40,519 40,613
Nonredeemable noncontrolling interests of consolidated investment management funds 50 56 65 72 7
Total permanent equity 40,820 40,914 40,889 40,591 40,620
Total liabilities, temporary equity and permanent equity $ 409,877 $ 405,052 $ 430,181 $ 424,899 $ 405,560
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FEE AND OTHER REVENUE
4Q23 vs. FY23 vs.
(dollars in millions) 4Q23 3Q23 2Q23 1Q23 4Q22 3Q23 4Q22 FY23 FY22 FY22
Investment services fees $ 2,242 $ 2,230 $ 2,252 $ 2,119 $ 2,173 1 % 3 % $ 8,843 $ 8,529 4 %
Investment management and performance fees:
Investment management fees (a) 724 747 752 754 757 (3) (4) 2,977 3,224 (8)
Performance fees 19 30 10 22 26 N/M N/M 81 75 8
Total investment management and performance fees (b) 743 777 762 776 783 (4) (5) 3,058 3,299 (7)
Foreign exchange revenue 143 154 158 176 190 (7) (25) 631 822 (23)
Financing-related fees 45 45 50 52 43 — 5 192 175 10
Distribution and servicing fees 41 39 35 33 33 5 24 148 130 14
Total fee revenue 3,214 3,245 3,257 3,156 3,222 (1) — 12,872 12,955 (1)
Investment and other revenue:
Income (loss) from consolidated investment management funds 26 (11) 10 5 9 N/M N/M 30 (42) N/M
Seed capital gains (losses) (c) 18 (4) 7 8 6 N/M N/M 29 (37) N/M
Other trading revenue 47 86 53 45 34 N/M N/M 231 149 N/M
Renewable energy investment gains (losses) 2 1 5 20 (4) N/M N/M 28 (12) N/M
Corporate/bank-owned life insurance 39 29 23 27 35 N/M N/M 118 128 N/M
Other investments gains (losses) (d) 55 (9) 10 (9) 7 N/M N/M 47 159 N/M
Disposal (losses) gains (6) 2 (1) (1) (11) N/M N/M (6) 26 N/M
Expense reimbursements from joint venture 28 29 31 29 28 N/M N/M 117 108 N/M
Other (loss) income (118) 55 9 8 12 N/M N/M (46) 34 N/M
Net securities (losses) gains (48) (19) — (1) (448) N/M N/M (68) (443) N/M
Total investment and other revenue 43 159 147 131 (332) N/M N/M 480 70 N/M
Total fee and other revenue $ 3,257 $ 3,404 $ 3,404 $ 3,287 $ 2,890 (4) % 13 % $ 13,352 $ 13,025 3 %
(a) Excludes seed capital gains (losses) related to consolidated investment management funds.
(b) On a constant currency basis (Non-GAAP), investment management and performance fees decreased 6% compared with 4Q22. See "Explanation of GAAP and Non-GAAP Financial Measures" beginning on page 23 for the reconciliation of this Non-GAAP measure.
(c) Includes gains (losses) on investments in BNY Mellon funds which hedge deferred incentive awards.
(d) Includes strategic equity, private equity and other investments.
N/M – Not meaningful.
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AVERAGE BALANCES AND INTEREST RATES
3Q23 2Q23 1Q23 4Q22
Average rate Average balance Average rate Average balance Average rate Average balance Average rate Average balance Average rate
(dollars in millions; average rates are annualized)
Assets
Interest-earning assets:
Interest-bearing deposits with the Federal Reserve and other central banks 107,291 4.72 % $ 98,767 4.57 % $ 114,578 4.29 % $ 94,899 3.59 % $ 94,868 2.60 %
Interest-bearing deposits with banks 4.26 12,287 4.04 13,919 3.68 16,225 3.51 15,750 2.70
Federal funds sold and securities purchased under resale agreements 35.55 (a) 26,915 30.47 (a) 26,989 26.38 (a) 24,631 16.32 (a) 25,657 11.22 (a)
Loans 6.43 63,962 6.39 63,459 6.05 63,261 5.54 67,364 4.65
Securities:
U.S. government obligations 3.40 32,224 3.08 34,147 2.90 38,852 2.89 39,382 2.46
U.S. government agency obligations 2.95 59,481 2.87 61,565 2.78 62,280 2.60 61,426 2.30
State and political subdivisions (b) 4.40 13 4.42 13 4.45 23 7.07 1,178 2.77
Other securities (b) 4.03 39,861 3.93 40,976 3.59 42,429 3.21 41,732 2.66
Total investment securities (b) 3.39 131,579 3.24 136,701 3.05 143,584 2.86 143,718 2.45
Trading securities (b) 5.59 5,534 5.49 6,403 5.02 5,778 4.97 5,630 4.51
Total securities (b) 3.49 137,113 3.33 143,104 3.14 149,362 2.94 149,348 2.53
Total interest-earning assets (b) 344,174 6.86 % $ 339,044 6.45 % $ 362,049 5.77 % $ 348,378 4.56 % $ 352,987 3.59 %
Noninterest-earning assets 58,247 58,912 58,900 61,315
Total assets 401,605 $ 397,291 $ 420,961 $ 407,278 $ 414,302
Liabilities and equity
Interest-bearing liabilities:
Interest-bearing deposits 220,408 3.79 % $ 209,641 3.62 % $ 215,057 3.24 % $ 204,114 2.71 % $ 207,875 2.00 %
Federal funds purchased and securities sold under repurchase agreements 52.41 (a) 21,512 36.07 (a) 26,282 26.39 (a) 18,316 19.75 (a) 13,985 16.88 (a)
Trading liabilities 4.83 3,959 4.80 3,893 4.46 3,025 4.05 3,572 3.45
Other borrowed funds 5.56 540 4.47 2,702 4.60 711 1.75 619 1.69
Commercial paper 5.40 7 4.13 5 5.11 — — 6 3.87
Payables to customers and broker-dealers 4.67 13,515 4.30 14,801 3.85 16,954 3.08 17,147 2.27
Long-term debt 5.70 31,161 5.52 31,970 5.45 30,246 5.22 29,508 4.90
Total interest-bearing liabilities 283,088 6.81 % $ 280,335 6.37 % $ 294,710 5.61 % $ 273,366 4.17 % $ 272,712 3.11 %
Total noninterest-bearing deposits 52,467 62,152 69,886 75,862
Other noninterest-bearing liabilities 23,699 23,526 23,687 25,704
Total The Bank of New York Mellon Corporation shareholders’ equity 40,711 40,493 40,321 39,986
Noncontrolling interests 79 80 18 38
Total liabilities and equity 401,605 $ 397,291 $ 420,961 $ 407,278 $ 414,302
Net interest margin 1.26 % 1.18 % 1.20 % 1.29 % 1.19 %
Net interest margin (FTE) – Non-GAAP (c) 1.26 % 1.18 % 1.20 % 1.29 % 1.19 %
(a) Includes the average impact of offsetting under enforceable netting agreements of approximately 141 billion for 4Q23, 126 billion for 3Q23, 113 billion for 2Q23, 62 billion for 1Q23 and 51 billion for 4Q22. On a Non-GAAP basis, excluding the impact of offsetting, the yield on federal funds sold and securities purchased under resale agreements would have been 5.48% for 4Q23, 5.36% for 3Q23, 5.10% for 2Q23, 4.62% for 1Q23 and 3.76% for 4Q22. On a Non-GAAP basis, excluding the impact of offsetting, the rate on federal funds purchased and securities sold under repurchase agreements would have been 5.35% for 4Q23, 5.26% for 3Q23, 4.99% for 2Q23, 4.49% for 1Q23 and 3.63% for 4Q22. We believe providing the rates excluding the impact of netting is useful to investors as it is more reflective of the actual rates earned and paid.
(b) Average rates were calculated on an FTE basis, at tax rates of approximately 21%.
(c) See "Explanation of GAAP and Non-GAAP Financial Measures" beginning on page 23 for the reconciliation of this Non-GAAP measure.

All values are in US Dollars.

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CAPITAL AND LIQUIDITY
2023 2022
(dollars in millions) Dec. 31 Sept. 30 June 30 March 31 Dec. 31
Consolidated regulatory capital ratios (a)
Standardized Approach:
CET1 capital $ 18,534 $ 18,156 $ 18,018 $ 17,761 $ 17,911
Tier 1 capital 22,863 22,985 22,848 22,595 22,735
Total capital 24,414 24,552 24,413 24,161 24,263
Risk-weighted assets 156,178 153,167 153,158 157,186 158,873
CET1 ratio 11.9 % 11.9 % 11.8 % 11.3 % 11.3 %
Tier 1 capital ratio 14.6 15.0 14.9 14.4 14.3
Total capital ratio 15.6 16.0 15.9 15.4 15.3
Advanced Approaches:
CET1 capital $ 18,534 $ 18,156 $ 18,018 $ 17,761 $ 17,911
Tier 1 capital 22,863 22,985 22,848 22,595 22,735
Total capital 24,085 24,305 24,151 23,890 24,022
Risk-weighted assets 161,528 160,262 163,335 162,692 161,449
CET1 ratio 11.5 % 11.3 % 11.0 % 10.9 % 11.1 %
Tier 1 capital ratio 14.2 14.3 14.0 13.9 14.1
Total capital ratio 14.9 15.2 14.8 14.7 14.9
Tier 1 leverage ratio:
Average assets for Tier 1 leverage ratio $ 383,705 $ 379,429 $ 402,993 $ 389,358 $ 396,427
Tier 1 leverage ratio 6.0 % 6.1 % 5.7 % 5.8 % 5.7 %
SLR:
Leverage exposure $ 313,555 $ 318,664 $ 326,002 $ 330,278 $ 335,833
SLR 7.3 % 7.2 % 7.0 % 6.8 % 6.8 %
Average liquidity coverage ratio 117 % 121 % 120 % 118 % 118 %
Average net stable funding ratio 135 % 136 % 136 % 132 % N/A (b)
(a) For our CET1, Tier 1 capital and Total capital ratios, our effective capital ratios under the U.S. capital rules are the lower of the ratios as calculated under the Standardized and Advanced Approaches, which for the periods presented, was the Advanced Approaches.
(b) The reporting requirement for the average net stable funding ratio became effective in 2Q23, inclusive of reporting the average 1Q23 ratio.
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SECURITIES SERVICES BUSINESS SEGMENT
4Q23 vs. FY23 vs.
(dollars in millions) 4Q23 3Q23 2Q23 1Q23 4Q22 3Q23 4Q22 FY23 FY22 FY22
Revenue:
Investment services fees:
Asset Servicing $ 975 $ 976 $ 980 $ 941 $ 965 — % 1 % $ 3,872 $ 3,888 — %
Issuer Services 285 281 319 236 271 1 5 1,121 1,009 11
Total investment services fees 1,260 1,257 1,299 1,177 1,236 — 2 4,993 4,897 2
Foreign exchange revenue 118 107 124 139 149 10 (21) 488 584 (16)
Other fees (a) 54 52 54 55 55 4 (2) 215 202 6
Total fee revenue 1,432 1,416 1,477 1,371 1,440 1 (1) 5,696 5,683 —
Investment and other revenue 112 65 84 72 70 N/M N/M 333 291 N/M
Total fee and other revenue 1,544 1,481 1,561 1,443 1,510 4 2 6,029 5,974 1
Net interest income 635 600 668 666 656 6 (3) 2,569 2,028 27
Total revenue 2,179 2,081 2,229 2,109 2,166 5 1 8,598 8,002 7
Provision for credit losses 64 19 16 — 11 N/M N/M 99 8 N/M
Noninterest expense (ex. amortization of intangible assets) 1,645 1,590 1,560 1,532 1,564 3 5 6,327 6,248 1
Amortization of intangible assets 8 8 7 8 8 — — 31 33 (6)
Total noninterest expense 1,653 1,598 1,567 1,540 1,572 3 5 6,358 6,281 1
Income before income taxes $ 462 $ 464 $ 646 $ 569 $ 583 — % (21) % $ 2,141 $ 1,713 25 %
Total revenue by line of business:
Asset Servicing $ 1,675 $ 1,585 $ 1,695 $ 1,657 $ 1,675 6 % — % $ 6,612 $ 6,293 5 %
Issuer Services 504 496 534 452 491 2 3 1,986 1,709 16
Total revenue by line of business $ 2,179 $ 2,081 $ 2,229 $ 2,109 $ 2,166 5 % 1 % $ 8,598 $ 8,002 7 %
Financial ratios:
Pre-tax operating margin 21 % 22 % 29 % 27 % 27 % 25 % 21 %
Memo: Securities lending revenue (b) $ 48 $ 46 $ 47 $ 48 $ 50 4 % (4) % $ 189 $ 182 4 %
(a) Other fees primarily include financing-related fees.
(b) Included in investment services fees reported in the Asset Servicing line of business.
N/M – Not meaningful.
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SECURITIES SERVICES BUSINESS SEGMENT
4Q23 vs. FY23 vs.
(dollars in millions, unless otherwise noted) 3Q23 2Q23 1Q23 4Q22 3Q23 4Q22 FY23 FY22 FY22
Selected balance sheet data:
Average loans 11,366 $ 11,236 $ 11,283 $ 10,939 $ 11,850 1 % (4) % $ 11,207 $ 11,245 — %
Average assets (a) 200,040 $ 190,964 $ 202,207 $ 196,560 $ 206,810 5 % (3) % $ 197,434 $ 212,575 (7) %
Average deposits 171,086 $ 162,509 $ 172,863 $ 167,209 $ 176,541 5 % (3) % $ 168,411 $ 183,990 (8) %
Selected metrics:
AUC/A at period end (in trillions) (b) 34.2 $ 32.3 $ 33.2 $ 32.6 $ 31.4 6 % 9 % $ 34.2 $ 31.4 9 %
Market value of securities on loan at period end (in billions) (c) 450 $ 406 $ 415 $ 441 $ 449 11 % — % $ 450 $ 449 — %
Issuer Services
Total debt serviced at period end (in trillions) 13.3 $ 13.1 $ 13.1 $ 12.9 $ 12.6 2 % 6 % $ 13.3 $ 12.6 6 %
Number of sponsored Depositary Receipts programs at period end 559 564 577 589 (3) % (8) % 543 589 (8) %
(a) In business segments where average deposits are greater than average loans, average assets include an allocation of investment securities equal to the difference.
(b) Consists of AUC/A primarily from the Asset Servicing line of business and, to a lesser extent, the Issuer Services business. Includes the AUC/A of CIBC Mellon of 1.7 trillion at Dec. 31, 2023, 1.5 trillion at Sept. 30, 2023, 1.6 trillion at June 30, 2023 and 1.5 trillion at March 31, 2023 and Dec. 31, 2022.
(c) Represents the total amount of securities on loan in our agency securities lending program. Excludes securities for which BNY Mellon acts as agent on behalf of CIBC Mellon clients, which totaled 63 billion at Dec. 31, 2023 and Sept. 30, 2023, 66 billion at June 30, 2023, 69 billion at March 31, 2023 and 68 billion at Dec. 31, 2022.

All values are in US Dollars.

THE BANK OF NEW YORK MELLON CORPORATION bnym_logox3.jpg
MARKET AND WEALTH SERVICES BUSINESS SEGMENT
4Q23 vs. FY23 vs.
(dollars in millions) 4Q23 3Q23 2Q23 1Q23 4Q22 3Q23 4Q22 FY23 FY22 FY22
Revenue:
Investment services fees:
Pershing $ 472 $ 478 $ 466 $ 469 $ 472 (1) % — % $ 1,885 $ 1,793 5 %
Treasury Services 179 180 183 175 176 (1) 2 717 719 —
Clearance and Collateral Management 322 305 295 290 279 6 15 1,212 1,086 12
Total investment services fees 973 963 944 934 927 1 5 3,814 3,598 6
Foreign exchange revenue 21 21 21 18 20 — 5 81 88 (8)
Other fees (a) 50 49 52 51 44 2 14 202 163 24
Total fee revenue 1,044 1,033 1,017 1,003 991 1 5 4,097 3,849 6
Investment and other revenue 16 16 16 15 15 N/M N/M 63 40 N/M
Total fee and other revenue 1,060 1,049 1,033 1,018 1,006 1 5 4,160 3,889 7
Net interest income 436 401 420 453 396 9 10 1,710 1,410 21
Total revenue 1,496 1,450 1,453 1,471 1,402 3 7 5,870 5,299 11
Provision for credit losses 28 6 7 — 6 N/M N/M 41 7 N/M
Noninterest expense (ex. amortization of intangible assets) 836 790 792 781 782 6 7 3,199 2,928 9
Amortization of intangible assets 1 2 2 1 2 (50) (50) 6 8 (25)
Total noninterest expense 837 792 794 782 784 6 7 3,205 2,936 9
Income before income taxes $ 631 $ 652 $ 652 $ 689 $ 612 (3) % 3 % $ 2,624 $ 2,356 11 %
Total revenue by line of business:
Pershing $ 669 $ 657 $ 641 $ 649 $ 630 2 % 6 % $ 2,616 $ 2,330 12 %
Treasury Services 408 397 413 419 388 3 5 1,637 1,514 8
Clearance and Collateral Management 419 396 399 403 384 6 9 1,617 1,455 11
Total revenue by line of business $ 1,496 $ 1,450 $ 1,453 $ 1,471 $ 1,402 3 % 7 % $ 5,870 $ 5,299 11 %
Financial ratios:
Pre-tax operating margin 42 % 45 % 45 % 47 % 44 % 45 % 44 %
(a) Other fees primarily include financing-related fees.
N/M – Not meaningful.
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MARKET AND WEALTH SERVICES BUSINESS SEGMENT
4Q23 vs. FY23 vs.
(dollars in millions, unless otherwise noted) 4Q23 3Q23 2Q23 1Q23 4Q22 3Q23 4Q22 FY23 FY22 FY22
Selected balance sheet data:
Average loans $ 39,200 $ 37,496 $ 36,432 $ 36,854 $ 39,843 5 % (2) % $ 37,502 $ 41,300 (9) %
Average assets (a) $ 132,357 $ 129,665 $ 131,519 $ 132,005 $ 132,169 2 % — % $ 131,383 $ 138,249 (5) %
Average deposits $ 87,695 $ 84,000 $ 85,407 $ 86,040 $ 86,083 4 % 2 % $ 85,785 $ 91,749 (7) %
Selected metrics:
AUC/A at period end (in trillions) (b) $ 13.3 $ 13.1 $ 13.4 $ 13.7 $ 12.7 2 % 5 % $ 13.3 $ 12.7 5 %
Pershing
AUC/A at period end (in trillions) $ 2.5 $ 2.4 $ 2.4 $ 2.4 $ 2.3 4 % 9 % $ 2.5 $ 2.3 9 %
Net new assets (U.S. platform) (in billions) (c) $ (4) $ 23 $ (34) $ 37 $ 42 N/M N/M $ 22 $ 121 N/M
Average active clearing accounts (in thousands) 8,012 7,979 7,946 7,849 7,603 — % 5 % 7,946 7,483 6 %
Treasury Services
Average daily U.S. dollar payment volumes 243,005 233,620 233,931 236,322 246,189 4 % (1) % 236,696 239,630 (1) %
Clearance and Collateral Management
Average tri-party collateral management balances (in billions) $ 5,248 $ 5,706 $ 6,044 $ 5,626 $ 5,451 (8) % (4) % $ 5,658 $ 5,285 7 %
(a) In business segments where average deposits are greater than average loans, average assets include an allocation of investment securities equal to the difference.
(b) Consists of AUC/A from the Clearance and Collateral Management and Pershing lines of business.
(c) Net new assets represent net flows of assets (e.g., net cash deposits and net securities transfers, including dividends and interest) in customer accounts in Pershing LLC, a U.S. broker-dealer.
N/M – Not meaningful.
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INVESTMENT AND WEALTH MANAGEMENT BUSINESS SEGMENT
4Q23 vs. FY23 vs.
(dollars in millions) 4Q23 3Q23 2Q23 1Q23 4Q22 3Q23 4Q22 FY23 FY22 FY22
Revenue:
Investment management fees $ 725 $ 748 $ 753 $ 755 $ 757 (3) % (4) % $ 2,981 $ 3,228 (8) %
Performance fees 19 30 10 22 26 N/M N/M 81 75 8
Investment management and performance fees (a) 744 778 763 777 783 (4) (5) 3,062 3,303 (7)
Distribution and servicing fees 66 62 58 55 54 6 22 241 192 26
Other fees (b) (55) (50) (56) (53) (58) N/M N/M (214) (133) N/M
Total fee revenue 755 790 765 779 779 (4) (3) 3,089 3,362 (8)
Investment and other revenue (c) (121) 1 12 6 (3) N/M N/M (102) (27) N/M
Total fee and other revenue (c) 634 791 777 785 776 (20) (18) 2,987 3,335 (10)
Net interest income 45 39 39 45 52 15 (13) 168 228 (26)
Total revenue 679 830 816 830 828 (18) (18) 3,155 3,563 (11)
Provision for credit losses (2) (9) 7 — 1 N/M N/M (4) 1 N/M
Noninterest expense (ex. goodwill impairment and amortization of intangible assets) 680 670 674 732 697 1 (2) 2,756 2,809 (2)
Goodwill impairment — — — — — N/M N/M — 680 N/M
Amortization of intangible assets 5 5 5 5 6 — (17) 20 26 (23)
Total noninterest expense 685 675 679 737 703 1 (3) 2,776 3,515 (21)
(Loss) income before income taxes $ (4) $ 164 $ 130 $ 93 $ 124 (102) % (103) % $ 383 $ 47 715 %
Total revenue by line of business:
Investment Management $ 415 $ 565 $ 553 $ 564 $ 558 (27) % (26) % $ 2,097 $ 2,423 (13) %
Wealth Management 264 265 263 266 270 — (2) 1,058 1,140 (7)
Total revenue by line of business $ 679 $ 830 $ 816 $ 830 $ 828 (18) % (18) % $ 3,155 $ 3,563 (11) %
Financial ratios:
Pre-tax operating margin (1) % 20 % 16 % 11 % 15 % 12 % 1 %
Adjusted pre-tax operating margin – Non-GAAP (d) (1) % 22 % 18 % 13 % 17 % 14 % 2 %
Selected balance sheet data:
Average loans $ 13,405 $ 13,519 $ 13,995 $ 13,960 $ 14,404 (1) % (7) % $ 13,718 $ 14,055 (2) %
Average assets (e) $ 26,341 $ 26,654 $ 27,399 $ 28,370 $ 28,625 (1) % (8) % $ 26,714 $ 32,057 (17) %
Average deposits $ 12,039 $ 13,578 $ 15,410 $ 16,144 $ 16,416 (11) % (27) % $ 14,280 $ 19,214 (26) %
(a) On a constant currency basis, investment management and performance fees decreased 6% (Non-GAAP) compared with 4Q22. See "Explanation of GAAP and Non-GAAP Financial Measures" beginning on page 23 for the reconciliation of this Non-GAAP measure.
(b) Other fees includes investment services fees, foreign exchange revenue and financing-related fees.
(c) Investment and other revenue and total fee and other revenue are net of income attributable to noncontrolling interests related to consolidated investment management funds.
(d) Net of distribution and servicing expense. See "Explanation of GAAP and Non-GAAP Financial Measures" beginning on page 23 for the reconciliation of this Non-GAAP measure.
(e) In business segments where average deposits are greater than average loans, average assets include an allocation of investment securities equal to the difference.
N/M – Not meaningful.
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AUM BY PRODUCT TYPE, CHANGES IN AUM AND WEALTH MANAGEMENT CLIENT ASSETS
4Q23 vs. FY23 vs.
(dollars in billions) 4Q23 3Q23 2Q23 1Q23 4Q22 3Q23 4Q22 FY23 FY22 FY22
AUM by product type (a):
Equity $ 145 $ 133 $ 145 $ 142 $ 135 9 % 7 %
Fixed income 205 190 203 207 198 8 4
Index 459 425 440 408 395 8 16
Liability-driven investments 605 534 579 604 570 13 6
Multi-asset and alternative investments 170 156 162 161 153 9 11
Cash 390 383 377 386 385 2 1
Total AUM $ 1,974 $ 1,821 $ 1,906 $ 1,908 $ 1,836 8 % 8 %
Changes in AUM (a):
Beginning balance of AUM $ 1,821 $ 1,906 $ 1,908 $ 1,836 $ 1,776 $ 1,836 $ 2,434
Net inflows (outflows):
Long-term strategies:
Equity (2) (3) (3) (4) (5) (12) (18)
Fixed income 3 (7) (4) 4 (12) (4) (21)
Liability-driven investments 4 1 (3) 10 19 12 78
Multi-asset and alternative investments (1) (4) (1) (3) (4) (9) (11)
Total long-term active strategies inflows (outflows) 4 (13) (11) 7 (2) (13) 28
Index (10) (2) 2 (2) (4) (12) 2
Total long-term strategies (outflows) inflows (6) (15) (9) 5 (6) (25) 30
Short-term strategies:
Cash 7 7 (9) — 27 5 (12)
Total net inflows (outflows) 1 (8) (18) 5 21 (20) 18
Net market impact 122 (50) (3) 52 18 121 (471)
Net currency impact 30 (27) 19 15 53 37 (113)
Divestiture — — — — (32) — (32)
Ending balance of AUM $ 1,974 $ 1,821 $ 1,906 $ 1,908 $ 1,836 8 % 8 % $ 1,974 $ 1,836 8 %
Wealth Management client assets (b) $ 312 $ 292 $ 286 $ 279 $ 269 7 % 16 %
(a) Excludes assets managed outside of the Investment and Wealth Management business segment.
(b) Includes AUM and AUC/A in the Wealth Management line of business.
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OTHER SEGMENT
(in millions) 4Q23 3Q23 2Q23 1Q23 4Q22 FY23 FY22
Revenue:
Fee revenue $ (17) $ 6 $ (2) $ 3 $ 12 $ (10) $ 61
Investment and other revenue 38 74 34 38 (414) 184 (221)
Total fee and other revenue 21 80 32 41 (402) 174 (160)
Net interest (expense) (15) (24) (27) (36) (48) (102) (162)
Total revenue 6 56 5 5 (450) 72 (322)
Provision for credit losses (6) (13) (25) 27 2 (17) 23
Noninterest expense 820 24 71 41 154 956 278
(Loss) income before income taxes $ (808) $ 45 $ (41) $ (63) $ (606) $ (867) $ (623)
Selected balance sheet data:
Average loans and leases $ 1,706 $ 1,711 $ 1,749 $ 1,508 $ 1,267 $ 1,669 $ 1,225
Average assets $ 42,867 $ 50,008 $ 59,836 $ 50,343 $ 46,698 $ 51,211 $ 43,806
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SECURITIES PORTFOLIO
(dollars in millions) Sept. 30, 2023 4Q23<br>change in<br>unrealized<br>gain (loss) Dec. 31, 2023 Fair value<br><br>as a % of amortized<br><br>cost (a) Unrealized<br>gain (loss) % Floating<br><br>rate (b) Ratings (c)
Fair value AAA/<br>AA- A+/<br>A- BBB+/<br>BBB- BB+ and<br>lower Not<br>rated
Fair value
Agency RMBS $ 35,850 $ 1,627 $ 43,197 $ 39,333 91 % $ (3,864) 21 % 100 % — % — % — % — %
U.S. Treasury 31,439 410 27,316 26,476 97 (840) 62 100 — — — —
Non-U.S. government (d) 20,650 238 21,135 20,543 97 (592) 42 94 3 2 1 —
Agency commercial MBS 10,927 220 11,602 11,010 95 (592) 45 100 — — — —
CLOs 6,908 34 7,125 7,119 100 (6) 100 100 — — — —
U.S. government agencies 6,630 164 7,199 6,780 94 (419) 42 100 — — — —
Foreign covered bonds 6,137 55 6,489 6,317 97 (172) 57 100 — — — —
Non-agency commercial MBS 3,012 55 3,245 2,997 92 (248) 53 100 — — — —
Non-agency RMBS 1,763 47 1,909 1,766 92 (143) 46 85 3 — 6 6
Other asset-backed securities 922 21 1,026 943 92 (83) 18 100 — — — —
Other debt securities 11 — 13 11 88 (2) — — — — — 100
Total securities $ 124,249 (e) $ 2,871 $ 130,256 $ 123,295 (e)(f) 95 % $ (6,961) (e)(g) 44 % 99 % 1 % — % — % — %
(a) Amortized cost reflects historical impairments, and is net of allowance for credit losses.
(b) Includes the impact of hedges.
(c) Represents ratings by S&P, or the equivalent.
(d) Includes supranational securities.
(e) Includes net unrealized gains on derivatives hedging securities available-for-sale (including terminated hedges) of 2,820 million at Sept. 30, 2023 and 1,767 million at Dec. 31, 2023.
(f) The fair value of available-for-sale securities totaled 78,584 million at Dec. 31, 2023, net of hedges, or 64% of the fair value of the securities portfolio, net of hedges. The fair value of the held-to-maturity securities totaled 44,711 million at Dec. 31, 2023, or 36% of the fair value of the securities portfolio, net of hedges.
(g) At Dec. 31, 2023, includes pre-tax net unrealized losses of 2,094 million related to available-for-sale securities, net of hedges, and 4,867 million related to held-to-maturity securities. The after-tax unrealized losses, net of hedges, related to available-for-sale securities was 1,580 million and the after-tax equivalent related to held-to-maturity securities was 3,711 million.
Note: The amortizable purchase premium (net of discount) relating to securities was 821 million at Dec. 31, 2023 and the amortization of that net purchase premium was 38 million in 4Q23.

All values are in US Dollars.

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ALLOWANCE FOR CREDIT LOSSES AND NONPERFORMING ASSETS
2023 2022
(dollars in millions) Dec. 31 Sept. 30 June 30 March 31 Dec. 31
Allowance for credit losses – beginning of period:
Allowance for loan losses $ 211 $ 191 $ 170 $ 176 $ 164
Allowance for lending-related commitments 85 91 83 78 72
Allowance for other financial instruments (a) 29 41 67 38 44
Allowance for credit losses – beginning of period $ 325 $ 323 $ 320 $ 292 $ 280
Net (charge-offs) recoveries:
Charge-offs — (1) (4) — (9)
Recoveries 5 — 2 1 1
Total net recoveries (charge-offs) 5 (1) (2) 1 (8)
Provision for credit losses (b) 84 3 5 27 20
Allowance for credit losses – end of period $ 414 $ 325 $ 323 $ 320 $ 292
Allowance for credit losses – end of period:
Allowance for loan losses $ 303 $ 211 $ 191 $ 170 $ 176
Allowance for lending-related commitments 87 85 91 83 78
Allowance for other financial instruments (a) 24 29 41 67 38
Allowance for credit losses – end of period $ 414 $ 325 $ 323 $ 320 $ 292
Allowance for loan losses as a percentage of total loans 0.45 % 0.32 % 0.30 % 0.27 % 0.27 %
Nonperforming assets $ 237 $ 48 $ 88 $ 105 $ 109
(a) Includes allowance for credit losses on federal funds sold and securities purchased under resale agreements, available-for-sale securities, held-to-maturity securities, accounts receivable, cash and due from banks and interest-bearing deposits with banks.
(b) Includes all other instruments within the scope of ASU 2016-13, Financial Instruments – Credit Losses: Measurement of Credit Losses on Financial Instruments.
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EXPLANATION OF GAAP AND NON-GAAP FINANCIAL MEASURES
BNY Mellon has included in this Revised Financial Supplement certain Non-GAAP financial measures on a tangible basis as a supplement to GAAP information, which exclude goodwill and intangible assets, net of deferred tax liabilities. We believe that the return on tangible common equity – Non-GAAP is additional useful information for investors because it presents a measure of those assets that can generate income, and the tangible book value per common share – Non-GAAP is additional useful information because it presents the level of tangible assets in relation to shares of common stock outstanding.
Net interest income, on a fully taxable equivalent ("FTE") basis – Non-GAAP and net interest margin (FTE) – Non-GAAP and other FTE measures include the tax equivalent adjustments on tax-exempt income which allows for the comparison of amounts arising from both taxable and tax-exempt sources and is consistent with industry practice. The adjustment to an FTE basis has no impact on net income.
BNY Mellon has included in this Revised Financial Supplement the adjusted pre-tax operating margin – Non-GAAP, which is the pre-tax operating margin for the Investment and Wealth Management business segment, net of distribution and servicing expense that was passed to third parties who distribute or service our managed funds. We believe that this measure is useful when evaluating the performance of the Investment and Wealth Management business relative to industry competitors.
The presentation of the growth rates of investment management and performance fees on a constant currency basis permits investors to assess the significance of changes in foreign currency exchange rates. Growth rates on a constant currency basis were determined by applying the current period foreign currency exchange rates to the prior period revenue. We believe that this presentation, as a supplement to GAAP information, gives investors a clearer picture of the related revenue results without the variability caused by fluctuations in foreign currency exchange rates.
Note: Quarterly returns on common and tangible common equity ratios are annualized.
Return on common equity and tangible common equity reconciliation
(dollars in millions) 4Q23 3Q23 2Q23 1Q23 4Q22 FY23 FY22
Net income applicable to common shareholders of The Bank of New York Mellon Corporation – GAAP $ 162 $ 958 $ 1,036 $ 911 $ 500 $ 3,067 $ 2,345
Add: Amortization of intangible assets 14 15 14 14 16 57 67
Less: Tax impact of amortization of intangible assets 4 3 4 3 4 14 16
Adjusted net income applicable to common shareholders of The Bank of New York Mellon Corporation, excluding amortization of intangible assets – Non-GAAP $ 172 $ 970 $ 1,046 $ 922 $ 512 $ 3,110 $ 2,396
Average common shareholders’ equity $ 36,050 $ 35,873 $ 35,655 $ 35,483 $ 35,148 $ 35,767 $ 36,067
Less: Average goodwill 16,199 16,237 16,219 16,160 16,229 16,204 17,060
Average intangible assets 2,858 2,875 2,888 2,899 2,905 2,880 2,939
Add: Deferred tax liability – tax deductible goodwill 1,205 1,197 1,193 1,187 1,181 1,205 1,181
Deferred tax liability – intangible assets 657 657 660 660 660 657 660
Average tangible common shareholders’ equity – Non-GAAP $ 18,855 $ 18,615 $ 18,401 $ 18,271 $ 17,855 $ 18,545 $ 17,909
Return on common equity – GAAP 1.8 % 10.6 % 11.7 % 10.4 % 5.6 % 8.6 % 6.5 %
Return on tangible common equity – Non-GAAP 3.6 % 20.6 % 22.8 % 20.5 % 11.4 % 16.8 % 13.4 %
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EXPLANATION OF GAAP AND NON-GAAP FINANCIAL MEASURES
Book value and tangible book value per common share reconciliation 2023 2022
(dollars in millions, except common shares and unless otherwise noted) Dec. 31 Sept. 30 June 30 March 31 Dec. 31
BNY Mellon shareholders’ equity at period end – GAAP $ 40,770 $ 40,858 $ 40,824 $ 40,519 $ 40,613
Less: Preferred stock 4,343 4,838 4,838 4,838 4,838
BNY Mellon common shareholders’ equity at period end – GAAP 36,427 36,020 35,986 35,681 35,775
Less: Goodwill 16,261 16,159 16,246 16,192 16,150
Intangible assets 2,854 2,859 2,881 2,890 2,901
Add: Deferred tax liability – tax deductible goodwill 1,205 1,197 1,193 1,187 1,181
Deferred tax liability – intangible assets 657 657 660 660 660
BNY Mellon tangible common shareholders’ equity at period end – Non-GAAP $ 19,174 $ 18,856 $ 18,712 $ 18,446 $ 18,565
Period-end common shares outstanding (in thousands) 759,344 769,073 778,782 789,134 808,445
Book value per common share – GAAP $ 47.97 $ 46.84 $ 46.21 $ 45.22 $ 44.25
Tangible book value per common share – Non-GAAP $ 25.25 $ 24.52 $ 24.03 $ 23.38 $ 22.96
Net interest margin reconciliation
(dollars in millions) 4Q23 3Q23 2Q23 1Q23 4Q22
Net interest income – GAAP $ 1,101 $ 1,016 $ 1,100 $ 1,128 $ 1,056
Add: Tax equivalent adjustment 1 — 1 — 2
Net interest income (FTE) – Non-GAAP $ 1,102 $ 1,016 $ 1,101 $ 1,128 $ 1,058
Average interest-earning assets $ 344,174 $ 339,044 $ 362,049 $ 348,378 $ 352,987
Net interest margin – GAAP (a) 1.26 % 1.18 % 1.20 % 1.29 % 1.19 %
Net interest margin (FTE) – Non-GAAP (a) 1.26 % 1.18 % 1.20 % 1.29 % 1.19 %
(a) Net interest margin is annualized.
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EXPLANATION OF GAAP AND NON-GAAP FINANCIAL MEASURES
Pre-tax operating margin reconciliation - Investment and Wealth Management business segment
(dollars in millions) 4Q23 3Q23 2Q23 1Q23 4Q22 FY23 FY22
(Loss) income before income taxes – GAAP $ (4) $ 164 $ 130 $ 93 $ 124 $ 383 $ 47
Total revenue – GAAP $ 679 $ 830 $ 816 $ 830 $ 828 $ 3,155 $ 3,563
Less: Distribution and servicing expense 89 87 93 86 87 355 345
Adjusted total revenue, net of distribution and servicing expense – Non-GAAP $ 590 $ 743 $ 723 $ 744 $ 741 $ 2,800 $ 3,218
Pre-tax operating margin – GAAP (a) (1) % 20 % 16 % 11 % 15 % 12 % 1 %
Adjusted pre-tax operating margin, net of distribution and servicing expense – Non-GAAP (a) (1) % 22 % 18 % 13 % 17 % 14 % 2 %
(a) Income before income taxes divided by total revenue.
Constant currency reconciliations 4Q23 vs.
(dollars in millions) 4Q23 4Q22 4Q22
Consolidated:
Investment management and performance fees – GAAP $ 743 $ 783 (5) %
Impact of changes in foreign currency exchange rates — 11
Adjusted investment management and performance fees – Non-GAAP $ 743 $ 794 (6) %
Investment and Wealth Management business segment:
Investment management and performance fees – GAAP $ 744 $ 783 (5) %
Impact of changes in foreign currency exchange rates — 11
Adjusted investment management and performance fees – Non-GAAP $ 744 $ 794 (6) %

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