Bank of New York Mellon Corp.'s second-quarter earnings nearly quadrupled as the financial-services company recovers from prior-year securities losses and Tarp-related charges.
It has been expanding its wealth-management business and in June unveiled plans for a unit that will handle futures and swap trades by major customers. The moves come as financial-services firms seek to tap into investors' appetite for clearing transactions and in anticipation of regulatory changes regarding collateral requirements in the U.S. and Europe.
The asset manager and securities adviser reported a profit of $658 million, or 54 cents a share — matching analysts' expectations, according to Thomson Reuters — up from $176 million, or 15 cents a share, a year earlier.
The prior year included a $236 million charge related to the repayment of $3 billion it received from Treasury's Trouble Asset Relief Program. Meanwhile, the latest quarter has $13 million of net securities gains, compared with prior-year losses of $256 million.
Fee revenue rose 1.8% to $2.56 billion as net interest revenue rose 3.1% to $722 million. on revenue of $3.34
Assets under management rose 19% on year to $1.047 trillion as of June 30 but fell 5.2% during the quarter amid declines in the stock market. Net inflows were $12 billion in the quarter
Credit-loss provisions tumbled to $20 million from $61 million a year earlier and $35 million in the first quarter. Nonperforming assets fell 12% to $406 million during the quarter.
Formed in July 2007 when Bank of New York acquired Mellon Financial Corp., the company is a "custodial bank," which generally holds investments and securities for other investors.
Shares closed Monday at $25.64 and were inactive premarket. The stock is down 8.3% in the past year.