Bank of New York Mellon Corp - FORM 8-K - EX-99.2 - FULL YEAR 2012 AND 4Q 2012 FINANCIAL TRENDS

Attached files

file	filename
8-K - FORM 8-K - Bank of New York Mellon Corp	d466079d8k.htm
EX-99.1 - QUARTERLY EARNINGS REVIEW FOR FULL YEAR 2012 AND FOURTH QUARTER 2012 - Bank of New York Mellon Corp	d466079dex991.htm

Exhibit 99.2

THE BANK OF NEW YORK MELLON CORPORATION

Financial Trends

Notes:

The following transactions/changes have impacted the reporting of our results:

On December 31, 2011, BNY Mellon sold its Shareowner Services business. In the first quarter of 2012, we reclassified the results of the Shareowner Services business from the Investment Services business to the Other segment. The reclassification did not impact the consolidated results. All prior periods have been restated.

On July 1, 2010 and August 2, 2010 we completed the acquisitions of Global Investment Servicing (“GIS”) and BHF Asset Servicing GmbH (“BAS”). The financial results for GIS are included in the Investment Services and Other businesses. The financial results for BAS are included in the Investment Services business.

On January 1, 2010, we adopted SFAS No. 167, “Amendments to FASB Interpretation No. 46 (R).” Certain investment management funds are disclosed separately on our balance sheet and securitizations are included in available-for-sale securities. The income statement separately discloses the operations of consolidated asset management funds and the net income attributable to noncontrolling interests of consolidated investment management funds; previously these were disclosed as investment management and performance fees revenue and investment and other income.

The following items have impacted the comparability of our results:

Results for the first quarter of 2010 include a charge related to special litigation reserves.

Expense efficiency restructuring charges - Recorded charges in 2010 and 2011

All of these items are detailed in the trends that follow.

Certain immaterial reclassifications have been made to prior periods to place them on a basis comparable with the current period’s presentation.

Discontinued Operations Accounting:

The income/(loss) and average assets from discontinued operations accounting have not been allocated to any business.

Average Assets:

In businesses where average deposits are greater than average loans, average assets include an allocation of investment securities equal to the difference. Consolidated average assets include average assets of discontinued operations.

Return on Common and Tangible Common Equity/Pretax Operating Margin:

Ratios are presented for continuing operations basis only. Quarterly return on common and tangible common equity ratios are annualized.

Non-GAAP Measures:

Certain Non-GAAP measures are included in the following schedules. These measures are used by management to monitor financial performance, both on a company-wide and on a business basis. These Non-GAAP measures impact certain revenue/expense categories, percentages and ratios by the exclusion and/or adjustment of items listed above and described in footnotes. For further information, see ‘Non-GAAP Financial Measures’ and ‘Supplemental Information - Explanation of Non-GAAP Financial Measures’ in The Bank of New York Mellon Corporation Quarterly Earnings Review dated January 16, 2013, furnished as an exhibit to the Report on Form 8-K to which these Financial Trends are furnished as an exhibit.

Summations may not equal due to rounding. As a result of this rounding convention, immaterial differences may exist between the business trends data versus business data on the Form 10-K for the year ended December 31, 2011 or other reports filed with the SEC.

Page 1 of 14

THE BANK OF NEW YORK MELLON CORPORATION

CONTINUING OPERATIONS - 12 Quarter Trend


	2010												2011												2012
(dollar amounts in millions unless otherwise noted)	1st Qtr			2nd Qtr			3rd Qtr			4th Qtr			1st Qtr			2nd Qtr			3rd Qtr			4th Qtr			1st Qtr			2nd Qtr			3rd Qtr			4th Qtr

Revenue:
Investment services fees
Asset servicing	$	637		$	668		$	863		$	908		$	917		$	973		$	922		$	885		$	943		$	950		$	942		$	945
Issuer services		333			354			364			409			351			365			442			287			251			275			311			215
Clearing services		230			245			252			278			292			292			297			278			303			309			287			294
Treasury services		131			125			139			135			134			134			133			134			136			134			138			141

Total investment services fees		1,331			1,392			1,618			1,730			1,694			1,764			1,794			1,584			1,633			1,668			1,678			1,595
Investment management and performance fees		686			686			696			800			764			779			729			730			745			797			779			853
Foreign exchange & other trading revenue		262			220			146			258			198			222			200			228			191			180			182			139
Distribution and servicing		48			51			56			55			53			49			43			42			46			46			48			52
Financing-related fees		50			48			49			48			43			49			40			38			44			37			46			45
Investment and other income		145			145			97			80			81			145			83			146			139			48			124			116

Total fee revenue		2,522			2,542			2,662			2,971			2,833			3,008			2,889			2,768			2,798			2,776			2,857			2,800
Net Securities gains (losses)		7			13			6			1			5			48			(2	)		(3	)		40			50			22			50

Total fee and other revenue		2,529			2,555			2,668			2,972			2,838			3,056			2,887			2,765			2,838			2,826			2,879			2,850
Income of consolidated investment management funds		65			65			37			59			110			63			32			(5	)		43			57			47			42
Net interest revenue		765			722			718			720			698			731			775			780			765			734			749			725

Total revenue		3,359			3,342			3,423			3,751			3,646			3,850			3,694			3,540			3,646			3,617			3,675			3,617
Provision for credit losses		35			20			(22	)		(22	)		—			—			(22	)		23			5			(19	)		(5	)		(61	)
Noninterest expenses		2,310			2,219			2,429			2,624			2,578			2,645			2,573			2,546			2,551			2,572			2,584			2,683
Amortization of intangible assets		97			98			111			115			108			108			106			106			96			97			95			96

Merger & integration, litigation and restructuring charges (a)		33			(1	)		71			64			11			63			92			176			109			378			26			46

Total noninterest expense		2,440			2,316			2,611			2,803			2,697			2,816			2,771			2,828			2,756			3,047			2,705			2,825
Income/ (loss) from continuing operations before taxes		884			1,006			834			970			949			1,034			945			689			885			589			975			853
Income taxes		258			304			220			265			279			277			281			211			254			93			225			207

Income/ (loss) from continuing operations		626			702			614			705			670			757			664			478			631			496			750			646
Income/ (loss) from discontinued operations, net of tax		(42	)		(10	)		(3	)		(11	)		—			—			—			—			—			—			—			—
Net income attributable to noncontrolling interest		(25	)		(34	)		11			(15	)		(45	)		(22	)		(13	)		27			(12	)		(30	)		(25	)		(11	)
Preferred dividends		—			—			—			—			—			—			—			—			—			—			(5	)		(13	)

Net income/ (loss) applicable to shareholders of The Bank of New York Mellon Corporation	$	559		$	658		$	622		$	679		$	625		$	735		$	651		$	505		$	619		$	466		$	720		$	622


EPS from continuing operations (b)	$	0.49		$	0.55		$	0.51		$	0.55		$	0.50		$	0.59		$	0.53		$	0.42		$	0.52		$	0.39		$	0.61		$	0.53

Market value of assets under management at period-end (in billions)	$	1,105		$	1,047		$	1,141		$	1,172		$	1,229		$	1,274		$	1,198		$	1,260		$	1,308		$	1,299		$	1,359		$	1,386

Market value of assets under custody and administration at period-end (in trillions) (c)	$	21.4		$	20.9		$	23.4		$	24.0		$	24.6		$	25.3		$	24.8		$	24.6		$	25.3		$	25.8		$	26.6		$	26.7

Market value of securities on loan at period-end (in billions)	$	253		$	248		$	279		$	278		$	278		$	273		$	250		$	269		$	265		$	275		$	259		$	246

Pre-tax operating margin
GAAP		26	%		30	%		24	%		26	%		26	%		27	%		26	%		19	%		24	%		16	%		27	%		24	%
Non-GAAP adjusted (d)		30	%		32	%		30	%		30	%		28	%		31	%		31	%		28	%		30	%		29	%		29	%		27	%
Return on common equity (annualized)
GAAP		8.2	%		8.8	%		7.8	%		8.5	%		7.7	%		8.8	%		7.6	%		5.9	%		7.4	%		5.5	%		8.3	%		7.1	%
Return on tangible common equity (annualized):
Non-GAAP		25.8	%		25.7	%		26.3	%		27.5	%		24.3	%		26.3	%		22.1	%		17.7	%		21.0	%		15.7	%		22.1	%		18.8	%
Percent of non-US fee and net interest revenue - GAAP		34	%		35	%		36	%		38	%		36	%		37	%		39	%		34	%		36	%		37	%		37	%		36	%
Percent of non-US fee and net interest revenue - Non-GAAP (e)		35	%		35	%		36	%		38	%		37	%		37	%		39	%		34	%		37	%		37	%		37	%		36	%

(a)

2010 and 1st quarter 2011 exclude litigation expense. For those periods, litigation is included in “Noninterest expenses”.

(b)

Includes $0.08 and $0.18 of litigation expense for 1st quarter 2010 and 2nd quarter 2012, respectively.

(c)

Preliminary. Prior periods have been restated to reflect a correction of a double-count of a portion of legacy Mellon’s assets under custody and administration.

(d)

Calculated excluding M&I expenses, restructuring charges, litigation expense, and noncontrolling interest related to consolidated asset management funds. 2010 and 1st quarter 2011 include litigation expense.

(e)

Calculated excluding net securities gains (losses) and including noncontrolling interest related to consolidated asset management funds.

Note: See pages 3 through 6 for additional details of revenue/expense items impacting continuing operations.

Page 2 of 14

THE BANK OF NEW YORK MELLON CORPORATION

CONTINUING OPERATIONS - 12 Quarter Trend

FEE AND OTHER REVENUE

(dollar amounts in millions unless otherwise noted)

2010

2011

2012

1st Qtr

2nd Qtr

3rd Qtr

4th Qtr

1st Qtr

2nd Qtr

3rd Qtr

4th Qtr

1st Qtr

2nd Qtr

3rd Qtr

4th Qtr

Investment services fees

Asset servicing

608

622

826

870

880

911

881

842

894

891

893

904

Securities lending

Issuer services

333

354

364

409

351

365

442

287

251

275

311

215

Memo: Issuer Services excluding Shareowner Services

283

298

318

360

292

314

400

245

251

275

311

215

Clearing services

230

245

252

278

292

297

278

303

309

287

294

Treasury services

131

125

139

135

134

133

134

136

134

138

141

Total investment services fees

1,331

1,392

1,618

1,730

1,694

1,764

1,794

1,584

1,633

1,668

1,678

1,595

Investment management and performance fees

686

696

800

764

779

729

730

745

797

779

853

Foreign exchange & other trading revenue

262

220

146

258

198

222

200

228

191

180

182

139

Distribution and servicing

Financing-related fees

Investment and other income

145

146

139

124

116

Total fee revenue

2,522

2,542

2,662

2,971

2,833

3,008

2,889

2,768

2,798

2,776

2,857

2,800

Net securities gains (losses)

)

Total fee and other revenue - Non-GAAP (a)

2,529

2,555

2,668

2,972

2,838

3,056

2,887

2,765

2,838

2,826

2,879

2,850

Less: Fee and Other revenue related to Shareowner Services

142

—

)

—

Total fee and other revenue ex Shareowner Services - Non-GAAP

2,475

2,497

2,621

2,920

2,776

3,002

2,843

2,623

2,838

2,829

2,879

2,850

Fee and other revenue as a percentage of total revenue - Non-GAAP (b)

Market value of assets under management at period-end (in billions)

1,105

1,047

1,141

1,172

1,229

1,274

1,198

1,260

1,308

1,299

1,359

1,386

Market value of assets under custody and administration at period-end (in trillions) (c)

21.4

20.9

23.4

24.0

24.6

25.3

24.8

24.6

25.3

25.8

26.6

26.7

Market value of securities on loan at period-end (in billions)

253

248

279

278

273

250

269

265

275

259

246

S&P 500 Index - period-end

1169

1031

1141

1258

1326

1321

1131

1258

1408

1362

1441

1426

S&P 500 Index - daily average

1123

1135

1095

1204

1302

1318

1227

1224

1347

1351

1400

1419

(a)

The GIS and BAS acquisitions were completed on July 1, 2010 and August 2, 2010, respectively. The Shareowner Services business was sold on December 31, 2011.

(b)

Excludes net securities gains/(losses).

(c)

Preliminary. Prior periods have been restated to reflect a correction of a double-count of a portion of legacy Mellon’s assets under custody and administration.

Page 3 of 14

THE BANK OF NEW YORK MELLON CORPORATION

CONTINUING OPERATIONS

Average Balances and Interest Rates

December 31, 2010

March 31, 2011

June 30, 2011

September 30, 2011

(dollar amounts in millions)

Average
balance

Average
rates

Average
balance

Average
rates

Average
balance

Average
rates

Average
balance

Average
rates

Assets

Interest-earning assets:

Interest-bearing deposits with banks (primarily foreign)

59,660

0.81

57,637

0.90

59,291

0.98

60,412

1.00

Interest-bearing deposits with Federal Reserve & other essential banks

16,787

0.32

20,367

0.32

34,068

0.32

61,115

0.31

Other Short Term Investment (FRB)

—

Federal funds sold and securities under resale agreements

5,553

3.15

4,514

0.50

4,577

0.46

4,865

0.71

Margin loans

6,289

1.55

7,484

1.48

9,508

1.34

9,379

1.34

Non-margin loans:

Domestic offices

21,754

2.55

21,856

2.57

21,093

2.54

21,583

2.43

Foreign offices

9,486

1.53

9,226

1.44

9,727

1.53

9,527

1.52

Total non-margin loans

31,240

2.24

31,082

2.22

30,820

2.23

31,110

2.15

Securities

U.S. government obligations

11,390

1.51

12,849

1.61

14,337

1.63

14,079

1.57

U.S. government agency obligations

21,406

2.95

20,221

2.98

20,466

3.09

20,998

2.93

Obligations of states and political subdivisions

587

6.53

557

6.37

934

5.32

1,611

4.13

Other securities

31,987

3.55

31,770

3.43

33,045

3.25

34,175

3.30

Trading securities

2,698

3.02

3,698

2.44

2,877

2.44

2,509

2.62

Total securities

68,068

3.02

69,095

2.96

71,659

2.87

73,372

2.87

Total interest-earning assets

187,597

1.90

190,179

1.80

209,923

1.70

240,253

1.55

Allowance for credit losses

(530

)

(494

)

(463

)

(437

)

Cash and due from banks

4,224

4,094

4,335

5,204

Other assets

50,220

49,577

50,459

53,305

Discontinued Operations

223

—

Total Asset Consol VIE FAS 167

14,675

14,342

14,226

13,138

Total Assets

256,409

257,698

278,480

311,463

Liabilities and total equity

Interest-bearing liabilities:

Money market rate accounts

6,296

0.40

5,417

0.38

4,029

0.41

4,532

0.35

Savings

1,352

0.26

1,518

0.12

1,561

0.12

1,613

0.12

Demand Deposits

0.97

0.86

0.91

0.82

Other time deposits

29,287

0.08

32,119

0.10

34,853

0.09

35,991

0.07

Foreign offices

74,760

0.14

77,379

0.19

85,430

0.26

83,580

0.26

Total interest-bearing deposits

111,776

0.14

116,515

0.17

125,958

0.22

125,795

0.21

Federal funds purchased and securities under repurchase agreements

7,256

2.13

5,172

0.07

10,894

0.06

10,164

0.03

Trading Liabilities

1,704

2.06

2,764

1.86

1,524

2.35

1,911

1.25

Other borrowed funds

1,999

0.80

1,821

1.61

1,877

0.99

2,256

0.77

Payables to customers and broker-dealers

5,878

0.11

6,701

0.10

6,843

0.09

7,692

0.10

Long-term debt

16,624

1.87

17,014

1.87

17,380

1.63

18,256

1.60

Total interest-bearing liabilities

145,237

0.47

149,987

0.40

164,476

0.38

166,074

0.37

Total noninterest-bearing deposits

39,625

38,616

43,038

73,389

Other liabilities

24,740

22,350

23,694

25,462

Discontinued Operations

223

—

VIE Liabilities & Obligations FAS 167

13,481

13,114

12,966

11,728

Total Shareholders’ Equity

32,379

32,827

33,464

34,008

Noncontrolling interest

724

804

842

802

Total liabilities and shareholders’ equity

256,409

257,698

278,480

311,463

Net interest margin - Taxable equivalent basis

1.54

1.49

1.41

1.30

Note: Interest and average rates were calculated on a taxable equivalent basis, at tax rates of approximately 35%, using dollar amounts in thousands and the actual number of days in the year.

Page 4 of 14

THE BANK OF NEW YORK MELLON CORPORATION

CONTINUING OPERATIONS

Average Balances and Interest Rates (continued)

Quarter Ended

December 31, 2011

March 31, 2012

June 30, 2012

September 30, 2012

December 31, 2012

(dollar amounts in millions)

Average
balance

Average
rates

Average
balance

Average
rates

Average
balance

Average
rates

Average
balance

Average
rates

Average
balance

Average
rates

Assets

Interest-earning assets:

Interest-bearing deposits with banks (primarily foreign)

43,628

1.08

35,095

1.30

38,474

0.98

41,201

0.96

41,018

0.80

Interest-bearing deposits with Federal Reserve & other essential banks

72,118

0.32

63,525

0.27

57,904

0.27

61,849

0.21

71,794

0.21

Other Short Term Investment (FRB)

—

Federal funds sold and securities under resale agreements

5,271

0.64

5,174

0.73

5,493

0.62

5,315

0.64

5,984

0.56

Margin loans

11,886

1.26

12,901

1.29

13,331

1.27

13,033

1.30

13,085

1.26

Non-margin loans:

Domestic offices

21,794

2.37

20,128

2.46

19,663

2.52

18,821

2.62

20,560

2.42

Foreign offices

10,556

1.54

10,180

1.77

9,998

1.86

10,574

1.61

9,968

1.64

Total non-margin loans

32,350

2.10

30,308

2.23

29,661

2.30

29,395

2.26

30,528

2.16

Securities

U.S. government obligations

18,693

1.45

17,268

1.56

15,387

1.65

18,917

1.39

19,915

1.39

U.S. government agency obligations

25,006

2.58

32,347

2.44

39,070

2.23

41,430

1.94

41,361

1.94

Obligations of states and political subdivisions

2,452

3.47

3,354

2.97

4,777

2.65

5,933

2.57

6,154

2.52

Other securities

33,830

3.19

33,839

2.84

32,625

2.51

33,724

2.51

35,082

2.04

Trading securities

2,490

2.94

2,520

2.78

3,033

2.57

4,431

2.40

5,294

2.54

Total securities

82,471

2.60

89,328

2.44

94,892

2.25

104,435

2.06

107,806

1.90

Total interest-earning assets

247,724

1.50

236,331

1.56

239,755

1.48

255,228

1.40

270,215

1.27

Allowance for credit losses

(384

)

(392

)

(382

)

(361

)

(337

)

Cash and due from banks

4,695

4,271

4,412

4,277

4,284

Other assets

52,200

49,690

49,933

48,775

50,439

Discontinued Operations

—

Total Asset Consol VIE FAS 167

11,839

11,444

11,284

10,995

11,394

Total Assets

316,074

301,344

305,002

318,914

335,995

Liabilities and total equity

Interest-bearing liabilities:

Money market rate accounts

4,666

0.27

4,299

0.27

8,236

0.24

9,004

0.16

5,807

0.22

Savings

1,080

0.15

704

0.10

702

0.13

730

0.17

815

0.29

Demand Deposits

0.77

147

0.36

185

0.32

720

1.06

2,763

0.08

Other time deposits

36,020

0.07

33,618

0.08

33,180

0.11

34,193

0.07

38,085

0.06

Foreign offices

88,494

0.22

86,670

0.15

88,179

0.13

93,613

0.10

95,249

0.09

Total interest-bearing deposits

130,343

0.18

125,438

0.14

130,482

0.13

138,260

0.10

142,719

0.09

Federal funds purchased and securities under repurchase agreements

8,008

(0.07

)

8,584

(0.02

)

11,254

0.01

10,092

(0.06

)

10,158

0.07

Trading Liabilities

1,225

1.62

1,153

1.55

1,256

1.87

1,397

1.87

1,943

1.41

Other borrowed funds

2,159

0.93

2,579

0.79

2,550

0.99

1,855

0.72

1,869

1.15

Payables to customers and broker-dealers

8,023

0.08

7,555

0.11

7,895

0.10

8,141

0.10

8,532

0.09

Long-term debt

19,546

1.55

20,538

1.79

20,084

1.67

19,535

1.66

19,259

1.46

Total interest-bearing liabilities

169,304

0.34

165,847

0.34

173,521

0.32

179,280

0.28

184,480

0.25

Total noninterest-bearing deposits

76,309

66,613

62,860

70,230

79,987

Other liabilities

25,433

24,248

23,588

23,712

24,458

Discontinued Operations

—

VIE Liabilities & Obligations FAS 167

10,516

10,159

10,072

9,686

10,114

Total Shareholders’ Equity

33,761

33,718

34,123

34,522

34,962

Noncontrolling interest

752

759

838

1,484

1,994

Total liabilities and total equity

316,074

301,344

305,002

318,914

335,995

Net interest margin - Taxable equivalent basis

1.27

1.32

1.25

1.20

1.09

Note: Interest and average rates were calculated on a taxable equivalent basis, at tax rates of approximately 35%, using dollar amounts in thousands and the actual number of days in the year.

Page 5 of 14

THE BANK OF NEW YORK MELLON CORPORATION

CONTINUING OPERATIONS - 12 Quarter Trend

NONINTEREST EXPENSE

2010

2011

2012

(dollar amounts in millions)

1st Qtr

2nd Qtr

3rd Qtr

4th Qtr

1st Qtr

2nd Qtr

3rd Qtr

4th Qtr

1st Qtr

2nd Qtr

3rd Qtr

4th Qtr

Staff:

Compensation

753

763

850

871

876

903

885

861

866

893

911

Incentives

284

272

289

348

325

328

281

352

311

306

311

Employee benefits

183

199

205

198

223

232

226

216

240

238

237

235

Total staff

1,220

1,234

1,344

1,417

1,424

1,463

1,457

1,382

1,453

1,415

1,436

1,457

Professional, legal and other purchased services

241

256

282

320

283

301

311

322

299

309

292

322

Software and equipment

169

162

187

207

206

203

193

213

205

209

208

233

Net occupancy

137

143

150

158

153

161

151

159

147

141

149

156

Distribution and servicing

104

111

109

100

101

103

109

108

Sub-custodian

Business development

Other

350

201

249

260

277

247

224

237

220

254

265

255

Subtotal (a)

2,310

2,219

2,429

2,624

2,578

2,645

2,573

2,546

2,551

2,572

2,584

2,683

Amortization of intangible assets

111

115

108

106

Merger & integration, litigation and restructuring charges (b)

)

176

109

378

Total noninterest expense

2,440

2,316

2,611

2,803

2,697

2,816

2,771

2,828

2,756

3,047

2,705

2,825

Memo:

Total noninterest expense excluding M&I, restructuring, litigation, amortization of intangible and direct expense related to Shareowner Services -Non-GAAP (b)

2,263

2,170

2,387

2,574

2,532

2,598

2,536

2,500

2,551

2,572

2,584

2,683

Full Time Employees at period-end (c)

42,300

42,700

47,700

48,000

48,400

48,900

49,600

48,700

47,800

48,200

48,700

49,500

(a)

The GIS and BAS acquisitions were completed on July 1, 2010 and August 2, 2010, respectively. The Shareowner Services business was sold on December 31, 2011.

(b)

2010 and 1st quarter 2011 exclude litigation expense. For those periods, litigation is included in “Other”.

(c)

Represents full time employees.

Page 6 of 14

THE BANK OF NEW YORK MELLON CORPORATION

ASSETS UNDER MANAGEMENT/ CUSTODY AND ADMINISTRATION / SECURITIES LENDING - 12 Quarter Trend


	2010												2011												2012
(dollar amounts in billions unless otherwise noted)	1st Qtr			2nd Qtr			3rd Qtr			4th Qtr			1st Qtr			2nd Qtr			3rd Qtr			4th Qtr			1st Qtr			2nd Qtr			3rd Qtr			4th Qtr
Market value of assets under management at period-end *(in billions)*
Institutional	$	620		$	595		$	639		$	639		$	701		$	733		$	719		$	757		$	829		$	835		$	882		$	894
Mutual Funds		396			370			418			454			451			462			406			427			404			388			398			411
Private Client		89			82			84			79			77			79			73			76			75			76			79			81
Total market value of assets under management (a)		1,105			1,047			1,141			1,172			1,229			1,274			1,198			1,260			1,308			1,299			1,359			1,386
Composition of assets under management at period-end
Equity		31	%		30	%		31	%		32	%		34	%		34	%		30	%		31	%		33	%		32	%		33	%		33	%
Fixed Income		28	%		30	%		30	%		29	%		30	%		31	%		35	%		35	%		35	%		37	%		37	%		38	%
Money Market		30	%		30	%		29	%		29	%		27	%		26	%		27	%		26	%		24	%		23	%		23	%		22	%
Alternative investments and overlay		11	%		10	%		10	%		10	%		9	%		9	%		8	%		8	%		8	%		8	%		7	%		7	%

Total		100	%		100	%		100	%		100	%		100	%		100	%		100	%		100	%		100	%		100	%		100	%		100	%
Market value of assets under custody and administration at period-end (in trillions) (b)	$	21.4		$	20.9		$	23.4		$	24.0		$	24.6		$	25.3		$	24.8		$	24.6		$	25.3		$	25.8		$	26.6		$	26.7
Market value of securities on loan at period-end (c)	$	253		$	248		$	279		$	278		$	278		$	273		$	250		$	269		$	265		$	275		$	259		$	246
Market Indices
S&P 500 Index (d)		1169			1031			1141			1258			1326			1321			1131			1258			1408			1362			1441			1426
S&P 500 Index - daily average		1123			1135			1095			1204			1302			1318			1227			1224			1347			1351			1400			1419
FTSE 100 Index (d)		5680			4917			5549			5900			5909			5946			5128			5572			5768			5571			5742			5898
FTSE 100 Index - daily average		5431			5361			5312			5760			5945			5906			5470			5424			5818			5555			5742			5842
MSCI World Index (d)		1201			1041			1179			1280			1335			1331			1104			1183			1312			1236			1312			1339
MSCI World Index		1162			1139			1120			1235			1319			1332			1217			1169			1268			1235			1273			1312
Barclays Capital Aggregate Bond Index (d)		300			299			329			323			328			341			346			347			351			353			368			366
NYSE & NASDAQ Share Volume (in billions)		246			299			233			219			225			213			250			206			186			192			173			174
JP Morgan G7 Currency Volatility Index - daily average (e)		11.93			12.92			12.07			12.46			11.07			11.21			12.60			12.95			10.39			10.30			8.70			7.56

(a)

Excludes securities lending cash management assets.

(b)

Preliminary. Prior periods have been restated to reflect a correction of a double-count of a portion of legacy Mellon’s assets under custody and administration.

(c)

Represents the securities on loan managed by the Investment Services business.

(d)

Period end.

(e)

The JP Morgan G7 Volatility Index is based on the implied volatility in 3-month currency options.

Page 7 of 14

THE BANK OF NEW YORK MELLON CORPORATION

ASSETS UNDER MANAGEMENT NET FLOWS - 12 Quarter Trend


	2010										2011											2012
(dollar amounts in billions )	1st Qtr			2nd Qtr			3rd Qtr		4th Qtr		1st Qtr			2nd Qtr			3rd Qtr			4th Qtr		1st Qtr			2nd Qtr			3rd Qtr		4th Qtr
Market value of assets under management at beginning of period	$	1,115		$	1,105		$	1,047	$	1,141	$	1,172		$	1,229		$	1,274		$	1,198	$	1,260		$	1,308		$	1,299	$	1,359
Net Flows
Long-term		16			12			11		9		31			32			4			16		7			26			9		14
Money market		(25	)		(17	)		18		6		(5	)		(1	)		(15	)		7		(9	)		(14	)		9		(6	)

Total net flows		(9	)		(5	)		29		15		26			31			(11	)		23		(2	)		12			18		8
Net Market and currency impact/other		(1	)		(53	)		65		16		31			14			(65	)		39		50			(21	)		42		19


Market value of assets under management at end of period (a)	$	1,105		$	1,047		$	1,141	$	1,172	$	1,229		$	1,274		$	1,198		$	1,260	$	1,308		$	1,299		$	1,359	$	1,386

(a)

Excludes securities lending cash management assets.

Page 8 of 14

THE BANK OF NEW YORK MELLON CORPORATION

BUSINESSES

INVESTMENT MANAGEMENT - 12 Quarter Trend


	2010												2011												2012
(dollar amounts in millions unless otherwise noted)	1st Qtr			2nd Qtr			3rd Qtr			4th Qtr			1st Qtr			2nd Qtr			3rd Qtr			4th Qtr			1st Qtr			2nd Qtr			3rd Qtr			4th Qtr
Revenue:
Investment management:
Mutual funds		249			254			270			293			283			290			263			237			260			270			283			293
Institutional clients		280			279			282			300			319			319			311			299			322			321			334			349
Wealth management fees		159			153			153			157			164			163			157			154			157			158			158			159

Total investment management revenue		688			686			705			750			766			772			731			690			739			749			775			801
Performance fees		13			18			16			75			17			18			11			47			16			54			10			57
Distribution and servicing		47			49			53			52			51			48			41			41			45			45			47			50
Other fee revenue (a)		8			(5	)		15			17			34			24			(26	)		(11	)		52			13			40			25

Total fee and other revenue		756			748			789			894			868			862			757			767			852			861			872			933
Net interest revenue		51			52			50			50			52			48			51			55			55			52			52			55

Total revenue		807			800			839			944			920			910			808			822			907			913			924			988
Provision for credit losses		—			—			1			2			—			1			—			—			—			—			—			—
Noninterest expenses (ex. intangible amortization)		554			582			621			664			627			641			622			632			619			642			644			712

Income before taxes (ex. intangible amortization)		253			218			217			278			293			268			186			190			288			271			280			276
Amortization of intangible assets		59			59			58			61			55			53			53			53			48			48			48			48

Income before taxes		194			159			159			217			238			215			133			137			240			223			232			228
Average assets	$	33,797		$	33,938		$	36,194		$	37,645		$	37,315		$	36,741		$	36,949		$	37,163		$	36,475		$	35,970		$	35,775		$	37,750
Market value of assets under management at period-end (in billions) (b)	$	1,105		$	1,047		$	1,141		$	1,172		$	1,229		$	1,274		$	1,198		$	1,260		$	1,308		$	1,299		$	1,359		$	1,386
Pre-tax operating margin
GAAP		24	%		20	%		19	%		23	%		26	%		24	%		16	%		17	%		26	%		24	%		25	%		23	%
Non-GAAP (ex. intangible amortization and net distribution and servicing expense) (c)		35	%		31	%		29	%		33	%		36	%		33	%		26	%		26	%		36	%		34	%		34	%		31	%

(a)

Other revenue includes asset servicing and treasury services revenue.

(b)

Excludes securities lending cash management assets.

(c)

Distribution and servicing expense totaled $88 million, $90 million, $94 million, and $104 million, respectively, for the quarters of 2010 and $110 million, $108 million, $99 million and $95 million, respectively, for the quarters of 2011 and $100 million, $102 million, $107 million and $106 million for the quarters of 2012.

Page 9 of 14

THE BANK OF NEW YORK MELLON CORPORATION

BUSINESSES

INVESTMENT SERVICES - 12 Quarter Trend

2010

2011

2012

(dollar amounts in millions unless otherwise noted)

1st Qtr

2nd Qtr

3rd Qtr

4th Qtr

1st Qtr

2nd Qtr

3rd Qtr

4th Qtr

1st Qtr

2nd Qtr

3rd Qtr

4th Qtr

Revenue:

Investment services fees

Asset servicing fees - ex. securities lending

597

609

814

855

863

891

862

823

876

872

875

885

Securities lending revenue

Issuer services

283

298

318

360

292

314

401

245

251

275

310

213

Clearing services

230

245

252

278

292

297

278

303

309

287

294

Treasury services

130

124

138

134

133

134

132

133

136

132

135

140

Total investment services fees

1,264

1,306

1,548

1,653

1,607

1,683

1,724

1,514

1,605

1,636

1,644

1,563

Foreign Exchange and other trading revenue

210

245

174

226

209

203

236

196

176

179

158

128

Other fee revenue (a)

118

Total fee and other revenue (a)

1,538

1,669

1,809

1,956

1,889

1,967

2,028

1,781

1,852

1,881

1,879

1,763

Net interest revenue

629

587

568

578

621

649

661

634

642

607

608

585

Total revenue (b)

2,167

2,256

2,377

2,534

2,510

2,616

2,689

2,415

2,494

2,488

2,487

2,348

Provision for credit losses

—

(14

)

—

Noninterest expenses (ex. intangible amortization) (b)

1,364

1,465

1,570

1,692

1,702

1,777

1,849

1,706

1,779

2,097

1,735

1,765

Income before taxes (ex. intangible amortization)

803

791

807

842

808

839

840

709

699

405

756

583

Amortization of intangible assets

Income before taxes

768

756

759

791

758

789

791

659

651

356

709

535

Average loans

14,273

17,053

17,941

19,053

20,554

22,891

22,879

26,804

25,902

24,981

24,365

24,395

Average assets

150,828

151,917

158,110

173,606

176,162

191,756

220,930

228,668

214,135

209,454

224,313

242,629

Average deposits

120,322

120,394

123,298

135,711

139,342

153,863

181,848

188,539

175,055

172,435

188,049

203,715

Pre-tax operating margin

GAAP

Non-GAAP adjusted (excluding intangible amortization)

Market value of assets under custody and administration at period-end (in trillions) (c)

21.4

20.9

23.4

24.0

24.6

25.3

24.8

24.6

25.3

25.8

26.6

26.7

Market value of securities on loan at period-end (in billions) (d)

253

248

279

278

273

250

269

265

275

259

246

Note: On December 31, 2011, BNY Mellon sold its Shareowner Services business. In the first quarter of 2012, we reclassified the results of the Shareowner Services business from the Investment Services business to the Other segment. The reclassification did not impact the consolidated results. All prior periods have been restated.

(a)

Total fee and other revenue includes investment management fees and distribution and servicing revenue.

(b)

On July 1, 2010 and August 2, 2010 the GIS and BAS acquisitions were completed.

(c)

Preliminary. Prior periods have been restated to reflect a correction of a double-count of a portion of legacy Mellon’s assets under custody and administration.

(d)

Represents the securities on loan managed by the Investment Services business.

Page 10 of 14

THE BANK OF NEW YORK MELLON CORPORATION

BUSINESSES

OTHER - 12 Quarter Trend


	2010												2011												2012
(dollar amounts in millions unless otherwise noted)	1st Qtr			2nd Qtr			3rd Qtr			4th Qtr			1st Qtr			2nd Qtr			3rd Qtr			4th Qtr			1st Qtr			2nd Qtr			3rd Qtr			4th Qtr

Revenue:
Fee and other revenue		276			170			119			167			147			269			121			240			166			112			150			185
Net interest revenue		85			83			100			92			25			34			63			91			68			75			89			85

Total revenue		361			253			219			259			172			303			184			331			234			187			239			270
Provision for credit losses		35			20			(23	)		(24	)		—			(1	)		(22	)		23			(11	)		(5	)		(1	)		(61	)
Noninterest expenses (ex. special litigation reserves, intangible amortization, M&I expenses and restructuring charges)		392			172			238			268			249			272			182			245			253			189			218			225

Income before taxes (ex. special litigation reserves, intangible amortization, M&I expenses and restructuring charges)		(66	)		61			4			15			(77	)		32			24			63			(8	)		3			22			106
Amortization of intangible assets		3			4			5			3			3			5			4			3			—			—			—			—

M&I and restructuring charges		33			(1	)		71			64			11			18			12			139			9			22			13			27

Income before taxes		(102	)		58			(72	)		(52	)		(91	)		9			8			(79	)		(17	)		(19	)		9			79

Average loans and leases	$	13,639		$	13,261		$	12,308		$	11,808		$	11,187		$	10,553		$	10,652		$	10,223		$	9,877		$	10,248		$	9,941		$	10,740
Average assets	$	39,892		$	42,726		$	45,774		$	44,936		$	44,221		$	49,983		$	53,584		$	50,243		$	50,734		$	59,578		$	58,826		$	55,616

Page 11 of 14

THE BANK OF NEW YORK MELLON CORPORATION

BUSINESSES


	Investment Management									Investment Services									Other									Consolidated Results
(dollar amounts in millions unless otherwise noted)	2012			2011			2010			2012			2011			2010			2012			2011			2010			2012 (c)			2011 (c)			2010 (c)
Revenue:
Investment services fees
Asset servicing		117			112			94			3,663			3,585			2,981			—			—			1			3,780			3,697			3,076
Issuer services		—			—			—			1,049			1,252			1,259			3			193			201			1,052			1,445			1,460
Clearing services		—			—			—			1,193			1,159			1,005			—			—			—			1,193			1,159			1,005
Treasury services		2			2			3			543			532			526			4			1			1			549			535			530

Total investment services fees		119			114			97			6,448			6,528			5,771			7			194			203			6,574			6,836			6,071
Investment management fees		3,064			2,959			2,829			55			53			38			—			3			3			3,119			3,015			2,870
Performance fees		137			93			122			—			1			1			(1	)		—			—			136			94			123
Foreign exchange and other trading revenue		9			—			10			641			844			855			42			4			21			692			848			886
Distribution and servicing		187			181			201			5			6			8			—			—			1			192			187			210
Financing-related fees		6			6			6			41			46			45			125			118			144			172			170			195
Investment and other income		(3	)		(100	)		(90	)		174			187			254			288			411			345			459			498			509

Total fee revenue		3,519			3,253			3,175			7,364			7,665			6,972			461			730			717			11,344			11,648			10,864
Net Securities gains (losses)		(1	)		1			12			11			—			—			152			47			15			162			48			27

Total fee and other revenue		3,518			3,254			3,187			7,375			7,665			6,972			613			777			732			11,506			11,696			10,891
Net interest revenue (expense)		214			206			203			2,442			2,565			2,362			317			213			360			2,973			2,984			2,925

Total revenue		3,732			3,460			3,390			9,817			10,230			9,334			930			990			1,092			14,479			14,680			13,816
Provision for credit losses		—			1			3			(2	)		—			—			(78	)		—			8			(80	)		1			11
Noninterest expenses (ex. M&I expenses and intangible amortization)		2,617			2,522			2,421			7,376			7,034			6,091			869			1,037			1,098			10,862			10,593			9,610

Income before taxes (ex. M&I expenses and intangible amortization)		1,115			937			966			2,443			3,196			3,243			139			(47	)		(14	)		3,697			4,086			4,195
Amortization of intangible assets		192			214			237			192			199			169			—			15			15			384			428			421
Merger & integration expense		—			—			—			—			—			—			87			91			139			87			91			139

Income before taxes and noncontrolling interest		923			723			729			2,251			2,997			3,074			52			(153	)		(168	)		3,226			3,567			3,635

Average loans	$	7,950		$	6,970		$	6,461		$	24,911		$	23,298		$	17,096		$	10,199		$	10,651		$	12,748		$	43,060		$	40,919		$	36,305
Average assets	$	36,493		$	37,041		$	35,407		$	222,752		$	204,569		$	158,676		$	56,136		$	49,535		$	43,353		$	315,381		$	291,145		$	237,436
Average deposits	$	11,684		$	10,113		$	8,240		$	184,927		$	166,076		$	124,969		$	7,599		$	6,490		$	6,229		$	204,210		$	182,679		$	139,438

Market value of assets under management at period-end (in billions)	$	1,386		$	1,260		$	1,172		$	—		$	—		$	—		$	—		$	—		$	—		$	1,386		$	1,260		$	1,172

Market value of assets under custody and administration at period-end (in trillions) (a)	$	—		$	—		$	—		$	26.7		$	24.6		$	24.0		$	—		$	—		$	—		$	26.7		$	24.6		$	24.0

Market value of securities on loan at period-end (in billions)	$	—		$	—		$	—		$	246		$	269		$	278		$	—		$	—		$	—		$	246		$	269		$	278

Pre-tax operating margin - GAAP		25	%		21	%		22	%		23	%		29	%		33	%		n/m			n/m			n/m			22	%		24	%		26	%
Pre-tax operating margin (ex. intangible amortization) - Non-GAAP		30	%		27	%		29	%		25	%		31	%		35	%		n/m			n/m			n/m			25	%		27	%		29	%
Pre-tax operating margin - Non-GAAP (b)		30	%		27	%		29	%		30	%		31	%		34	%		n/m			n/m			n/m			25	%		28	%		32	%

Memo:
Securities Lending Revenue																													198			183			150

(a)

Preliminary. Prior periods have been restated to reflect a correction of a double-count of a portion of legacy Mellon’s assets under custody and administration.

(b)

Excludes M&I expenses, tax settlements, support agreement charges, restructuring charges, special litigation, investment write-downs and intangible amortization expense.

(c)

Total fee and other revenue and income before taxes for the years 2010, 2011 and 2012 includes income from consolidated investment management funds of $226 million, $200 million and $189 million, respectively, net of income attributable to noncontrolling interests of $59 million, $50 million, and $76 million, respectively. The net of these income statement line items of $167 million, $150 million, and $113 million, respectively, are included above in fee and other revenue.

n/m - not meaningful

Note: See pages 9-11 for details of revenue/expense items impacting respective business results.

Page 12 of 14

THE BANK OF NEW YORK MELLON CORPORATION

CONTINUING OPERATIONS - 12 Quarter Trend

NONPERFORMING ASSETS


	2010												2011												2012
(dollar amounts in millions)	1st Qtr			2nd Qtr			3rd Qtr			4th Qtr			1st Qtr			2nd Qtr			3rd Qtr			4th Qtr			1st Qtr			2nd Qtr			3rd Qtr			4th Qtr

Loans:
Other residential mortgages	$	204		$	229		$	238		$	244		$	245		$	236		$	228		$	203		$	188		$	177		$	166		$	158
Wealth Management		58			62			66			59			56			31			32			32			35			35			33			30
Commercial real estate		50			49			39			44			36			28			28			40			39			30			29			18
Commercial		40			40			35			34			32			31			21			21			32			31			29			27
Foreign		7			7			—			7			7			13			13			10			10			9			9			9
Financial Institutions		95			13			16			5			4			4			12			23			14			3			3			3


Total nonperforming loans		454			400			394			393			380			343			334			329			318			285			269			245
Other assets owned		5			6			7			6			6			8			10			12			13			9			5			4

Total nonperforming assets (a)	$	459		$	406		$	401		$	399		$	386		$	351		$	344		$	341		$	331		$	294		$	274		$	249


Nonperforming assets ratio		1.35	%		1.09	%		1.06	%		1.06	%		0.96	%		0.83	%		0.76	%		0.78	%		0.77	%		0.65	%		0.60	%		0.53	%
Nonperforming assets ratio excluding margin loans		1.58	%		1.29	%		1.26	%		1.29	%		1.26	%		1.08	%		0.98	%		1.09	%		1.11	%		0.92	%		0.83	%		0.74	%

Allowance for loan losses/nonperforming loans		114.5			135.5			135.5			126.7			122.9			128.6			117.4			119.8			121.4			127.0			126.0			108.6
Allowance for loan losses/nonperforming assets		113.3			133.5			133.2			124.8			121.0			125.6			114.0			115.5			116.6			123.1			123.7			106.8
Total allowance for credit losses/nonperforming loans		140.5			161.3			154.3			145.3			145.8			156.0			149.1			151.1			155.3			163.9			169.5			158.0
Total allowance for credit losses/nonperforming assets		139.0			158.9			151.6			143.1			143.5			152.4			144.8			145.7			149.2			158.8			166.4			155.4

(a)

Loans of consolidated investment management funds are not part of BNY Mellon’s loan portfolio. Included in these loans are nonperforming loans for the 1st, 2nd, 3rd and 4th quarters of 2010 of $150 million, $131 million, $231 million and $218 million, respectively, and for 1st, 2nd, 3rd and 4th quarters of 2011 of $239 million, $216 million, $265 million, and $101 million, respectively, and for the 1st, 2nd, 3rd and 4th quarters of 2012 $180 million, $155 million, $153 million, and $174 respectively. These loans are recorded at fair value and therefore do not impact the provision for credit losses and allowance for loan losses, and accordingly are excluded from the nonperforming assets table above.

Page 13 of 14

THE BANK OF NEW YORK MELLON CORPORATION

CONTINUING OPERATIONS - 12 Quarter Trend

ALLOWANCE FOR CREDIT LOSSES, PROVISION AND NET CHARGE-OFFS


	2010												2011												2012
(dollar amounts in millions)	1st Qtr			2nd Qtr			3rd Qtr			4th Qtr			1st Qtr			2nd Qtr			3rd Qtr			4th Qtr			1st Qtr			2nd Qtr			3rd Qtr			4th Qtr

Allowance for credit losses:
Allowance for credit losses	$	503		$	520		$	542		$	534		$	498		$	467		$	441		$	392		$	394		$	386		$	362		$	339
Allowance for unfunded commitments		125			118			103			74			73			87			94			106			103			108			105			117

Allowance for credit losses – beginning of period		628			638			645			608			571			554			535			498			497			494			467			456

Net (charge-offs)/recoveries
Charge-offs		(37	)		(14	)		(17	)		(17	)		(19	)		(21	)		(17	)		(25	)		(10	)		(10	)		(8	)		(10	)
Recoveries		12			1			2			2			2			2			2			1			2			2			2			2

Total Net (charge-offs)/recoveries		(25	)		(13	)		(15	)		(15	)		(17	)		(19	)		(15	)		(24	)		(8	)		(8	)		(6	)		(8	)

Provision for credit losses		35			20			(22	)		(22	)		—			—			(22	)		23			5			(19	)		(5	)		(61	)

Allowance for credit losses – end of period		638			645			608			571			554			535			498			497			494			467			456			387

Allowance for loan losses	$	520		$	542		$	534		$	498		$	467		$	441		$	392		$	394		$	386		$	362		$	339		$	266
Allowance for unfunded commitments		118			103			74			73			87			94			106			103			108			105			117			121

Allowance for credit losses – end of period		638			645			608			571			554			535			498			497			494			467			456			387

Allowance for loan losses as a percentage of total loans		1.54	%		1.46	%		1.41	%		1.32	%		1.17	%		1.05	%		0.87	%		0.90	%		0.90	%		0.80	%		0.74	%		0.57	%

Page 14 of 14

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