Bank of New York Mellon Corporation

Company Overview

Business Model: The Bank of New York Mellon Corporation is a global company that provides trust and custody activities, investment management services, banking services, and various securities-related activities. Its primary revenue generation mechanisms are structured around three principal business segments: Securities Services, Market and Wealth Services, and Investment and Wealth Management. The company also manages a significant volume of assets under custody and/or administration and assets under management.

Market Position: The Bank of New York Mellon Corporation operates as a global financial services firm, with $52.1 trillion in assets under custody and/or administration and $2.0 trillion in assets under management as of December 31, 2024. It competes intensely across all aspects of its business with domestic and international financial services firms, including those offering custody, corporate trust, clearing, collateral management, credit, securities brokerage, foreign exchange, derivatives, depositary receipt services, integrated cash management solutions, investment management, and wealth management. Competition is driven by factors such as customer service, transaction execution, capital access, product quality and range, performance, technological innovation, price, reputation, and lending limits.

Recent Strategic Developments: The Bank of New York Mellon Corporation provided eligible employees with an award of 10 restricted stock units ("BK Shares") in 2024, allowing them to become equity owners or increase their equity holdings in the company.

Geographic Footprint: The Bank of New York Mellon Corporation is headquartered in New York, New York. Its operations extend globally, with significant presence in the U.S. through principal banking subsidiaries like The Bank of New York Mellon and BNY Mellon, National Association, and four other U.S. bank and/or trust company subsidiaries. Internationally, approximately 60% of its total employees are based outside the U.S. Key international operations include The Bank of New York Mellon SA/NV, its main banking subsidiary in continental Europe with a principal office in Brussels and branches in Amsterdam, Copenhagen, Dublin, Frankfurt, the City of Luxembourg, Madrid, Milan, Paris, and Wroclaw. Other significant international employee concentrations include approximately 10,900 employees in Europe, the Middle East and Africa ("EMEA"), approximately 18,900 employees in the Asia-Pacific region ("APAC"), and approximately 800 employees in other global locations, primarily Brazil.

Financial Performance

Revenue Analysis

Profitability Metrics:

• Gross Margin: Information not provided in filing
• Operating Margin: Information not provided in filing
• Net Margin: Information not provided in filing

Investment in Growth:

• R&D Expenditure: Information not provided in filing
• Capital Expenditures: Information not provided in filing
• Strategic Investments: Information not provided in filing

Business Segment Analysis

Securities Services

Financial Performance:

• Revenue: Information not provided in filing
• Operating Margin: Information not provided in filing
• Key Growth Drivers: Information not provided in filing

Product Portfolio:

• Asset Servicing
• Issuer Services
• Global custody
• Collateral management

Market Dynamics:

• The Bank of New York Mellon's Securities Services businesses are housed within The Bank of New York Mellon, a New York state-chartered bank. The Bank of New York Mellon SA/NV focuses on global custody, asset servicing, and collateral management within this segment. The segment competes with domestic and international financial services firms offering custody services, corporate trust services, clearing services, and collateral management services.

Market and Wealth Services

Financial Performance:

• Revenue: Information not provided in filing
• Operating Margin: Information not provided in filing
• Key Growth Drivers: Information not provided in filing

Product Portfolio:

• Treasury Services
• Clearance and Collateral Management
• Certain activities of Pershing businesses

Market Dynamics:

• Certain Market and Wealth Services businesses, including Treasury Services and Clearance and Collateral Management, are housed within The Bank of New York Mellon. The Bank of New York Mellon SA/NV also conducts activities in this segment. The segment competes with financial services firms offering clearing services, collateral management services, credit services, securities brokerage, foreign exchange services, derivatives, depositary receipt services, and integrated cash management solutions.

Investment and Wealth Management

Financial Performance:

• Revenue: Information not provided in filing
• Operating Margin: Information not provided in filing
• Key Growth Drivers: Information not provided in filing

Product Portfolio:

• Wealth Management business
• Bank-advised business of Investment Management
• Most of Investment Management business and Pershing businesses (direct or indirect non-bank subsidiaries)

Market Dynamics:

• The Wealth Management business is housed within BNY Mellon, National Association. The bank-advised business of Investment Management is housed within The Bank of New York Mellon. This segment competes with domestic and international investment management and wealth management firms, hedge funds, investment banking companies, and other financial services companies, including trust banks, brokerage firms, and insurance companies.

Other Segment

Financial Performance:

• Revenue: Information not provided in filing
• Operating Margin: Information not provided in filing
• Key Growth Drivers: Information not provided in filing

Product Portfolio:

• Leasing portfolio
• Corporate treasury activities (including the securities portfolio)
• Derivatives and other trading activity
• Corporate and bank-owned life insurance
• Tax credit investments
• Other corporate investments and certain business exits

Market Dynamics:

• This segment encompasses various corporate and non-core activities.

Capital Allocation Strategy

Shareholder Returns:

• Share Repurchases: Information not provided in filing
• Dividend Payments: Information not provided in filing
• Dividend Yield: Information not provided in filing
• Future Capital Return Commitments: The Bank of New York Mellon Corporation's ability to return capital to shareholders is subject to the discretion of its Board of Directors and may be limited by U.S. banking laws and regulations, including those governing capital and capital planning, applicable provisions of Delaware law, and failure to pay full and timely dividends on its preferred stock. Share repurchases may be executed through open market repurchases, privately negotiated transactions, or other means, including repurchase plans designed to comply with Rule 10b5-1 and other derivative, accelerated share repurchase, and structured transactions.

Balance Sheet Position:

• Cash and Equivalents: Information not provided in filing
• Total Debt: Information not provided in filing
• Net Cash Position: Information not provided in filing
• Credit Rating: Information not provided in filing
• Debt Maturity Profile: Information not provided in filing

Cash Flow Generation:

• Operating Cash Flow: Information not provided in filing
• Free Cash Flow: Information not provided in filing
• Cash Conversion Metrics: Information not provided in filing

Operational Excellence

Production & Service Model: The Bank of New York Mellon Corporation's U.S. banking subsidiaries engage in trust and custody activities, investment management services, banking services, and various securities-related activities. The Bank of New York Mellon SA/NV focuses on global custody, asset servicing, and collateral management in continental Europe.

Supply Chain Architecture: Key Suppliers & Partners:

• Information not provided in filing

Facility Network:

• Manufacturing: Information not provided in filing
• Research & Development: Information not provided in filing
• Distribution: The corporate headquarters is located at 240 Greenwich Street in New York City, a 23-story owned building of approximately 1.2 million square feet. Additional offices and commercial space in the U.S. and elsewhere in the Americas (primarily Brazil and Canada) total approximately 4.4 million square feet of leased and owned space. In the EMEA region, offices total approximately 1.1 million square feet of leased and owned space. In the APAC region, there is 1.8 million square feet of leased space. These global facilities are used across all business segments for corporate purposes.

Operational Metrics:

• Information not provided in filing

Market Access & Customer Relationships

Go-to-Market Strategy: Distribution Channels:

• Information not provided in filing

Customer Portfolio: Enterprise Customers:

• Information not provided in filing

Geographic Revenue Distribution:

• Information not provided in filing

Competitive Intelligence

Market Structure & Dynamics

Industry Characteristics: The financial services industry is characterized by intense competition based on customer service and convenience, transaction execution, capital or access to capital, quality and range of products and services offered, performance, technological innovation and expertise (including adaptation to technological change), price, reputation, and lending limits. Competition varies by client types, industries, and geographies.

Competitive Positioning Matrix:

Direct Competitors

Primary Competitors:

• Domestic and international financial services firms offering custody services, corporate trust services, clearing services, collateral management services, credit services, securities brokerage, foreign exchange services, derivatives, depositary receipt services, and integrated cash management solutions.
• Domestic and international investment management and wealth management firms, hedge funds, investment banking companies, and other financial services companies, including trust banks, brokerage firms, and insurance companies.
• Financial services data processing firms.

Emerging Competitive Threats:

• Financial technology firms, as technological advances enable more companies to provide financial services.

Competitive Response Strategy:

• The Bank of New York Mellon Corporation's ability to compete effectively depends on its capacity to attract new employees, and to retain, develop, and motivate existing employees, particularly amid heightened regulatory restrictions and an inflationary or uncertain interest rate environment.

Risk Assessment Framework

Strategic & Market Risks

Market Dynamics: Weakness and volatility in financial markets and the economy generally may materially adversely affect business, financial condition, and results of operations. The company is dependent on fee-based business for a substantial majority of its revenue, which could be adversely affected by slowing market activity, weak financial markets, underperformance, and/or negative trends in savings rates or investment preferences. Levels of and changes in interest rates have impacted, and will continue to impact, profitability and capital levels, at times adversely. The company may experience unrealized or realized losses on securities related to volatile and illiquid market conditions, reducing capital levels and/or earnings. Technology Disruption: The development and use of artificial intelligence present risks and challenges that may adversely impact the business. Customer Concentration: The failure or perceived weakness of any significant clients or counterparties, many of whom are major financial institutions or sovereign entities, and the assumption of credit, counterparty, and concentration risk, could expose the company to credit losses and adversely affect its business. Strategic Initiatives: New lines of business, new products and services, or transformational or strategic project initiatives subject the company to new or additional risks, and the failure to implement these initiatives could affect results of operations. Strategic transactions present risks and uncertainties and could have an adverse effect on business, financial condition, and results of operations. The company may not realize some or all of the expected benefits of its transition to a platforms operating model. Reputational Harm: The business may be negatively affected by adverse events, publicity, government scrutiny, or other reputational harm. Sustainability Concerns: Sustainability concerns, including a focus on climate change and diversity, could adversely affect the business, client activity levels, subject the company to additional regulatory requirements, and damage its reputation.

Operational & Execution Risks

Operational Integrity: Errors or delays in operational and transaction processing, or those of third parties, may materially adversely affect business, financial condition, results of operations, and reputation. The risk management framework, policies, and processes may not be effective in identifying or mitigating risk and reducing the potential for losses, and any inadequacy or lapse could expose the company to unexpected losses. Limitations of the models used to measure, monitor, and manage risk could lead to unexpected losses and adverse business impacts. A failure or circumvention of controls, policies, and procedures could have a material adverse effect on business, financial condition, results of operations, and reputation. Technology & Cybersecurity: A communications or technology disruption or failure within the company's infrastructure or the infrastructure of third parties that results in a loss of information, delays access to information, or impacts the ability to provide services to clients may materially adversely affect business, financial condition, and results of operations. A cybersecurity incident, or a failure in computer systems, networks, and information, or those of third parties, could result in theft, disclosure, use or alteration of information, unauthorized access to or loss of information, or system or network failures, adversely impacting the ability to conduct business, damaging reputation, and causing losses. Human Capital: The business may be adversely affected if the company is unable to attract, retain, develop, and motivate employees.

Financial & Regulatory Risks

Credit Risk: The company could incur losses if its allowance for credit losses, including loan and lending-related commitment reserves, is inadequate or if expectations of future economic conditions deteriorate. Liquidity Risk: Business, financial condition, and results of operations could be adversely affected if liquidity is not effectively managed. Regulatory Compliance: The company is subject to extensive government rulemaking, policies, regulation, and supervision that impact operations. Changes to and introduction of new rules and regulations have compelled, and may in the future compel, changes in how businesses are managed, which could have a material adverse effect. Regulatory or enforcement actions or litigation could materially adversely affect results of operations or harm businesses or reputation. Failure to satisfy regulatory standards, including "well capitalized" and "well managed" status or capital adequacy and liquidity rules more generally, could result in limitations on activities and adversely affect business and financial condition. Funding & Capital: The Parent is a non-operating holding company and is dependent on dividends from its subsidiaries and extensions of credit from its IHC to meet its obligations, including with respect to its securities, and to provide funds for share repurchases, payment of income taxes, and payment of dividends to its stockholders. Any material reduction in credit ratings or the credit ratings of principal bank subsidiaries (The Bank of New York Mellon, BNY Mellon, N.A., or The Bank of New York Mellon SA/NV) could increase the cost of funding and borrowing and have a material adverse effect on business, financial condition, results of operations, and the value of issued securities. The application of the Title I preferred resolution strategy or resolution under the Title II orderly liquidation authority could adversely affect the Parent’s liquidity and financial condition and the Parent’s security holders. Tax & Accounting: Tax law changes or challenges to tax positions with respect to historical transactions may adversely affect net income, effective tax rate, and overall results of operations and financial condition. Changes in accounting standards governing the preparation of financial statements and future events could have a material impact on reported financial condition, results of operations, cash flows, and other financial data.

Geopolitical & External Risks

External Events: Impacts from geopolitical events, acts of terrorism, war, natural disasters, the physical effects of climate change, pandemics, and other similar events may have a negative impact on business and operations.

Innovation & Technology Leadership

Research & Development Focus: Core Technology Areas:

• The Bank of New York Mellon Corporation emphasizes technological innovation and expertise, including adaptation to technological change, as a key competitive factor. The company is also undergoing a transition to a platforms operating model.

Intellectual Property Portfolio:

• Information not provided in filing

Technology Partnerships:

• Information not provided in filing

Leadership & Governance

Executive Leadership Team

Leadership Continuity: Information not provided in filing

Board Composition: As of the end of 2024, 45% of the Board of Directors were women, and 27% of the Board of Directors was composed of individuals from underrepresented ethnic and/or racial backgrounds.

Human Capital Strategy

Workforce Composition:

• Total Employees: Approximately 51,800 full-time employees globally at December 31, 2024.
• Geographic Distribution: Approximately 60% of total employees (full-time and part-time) were based outside the U.S. at December 31, 2024. This includes approximately 10,900 employees in EMEA, approximately 18,900 employees in the APAC region, and approximately 800 employees in other global locations, primarily Brazil.
• Skill Mix: Information not provided in filing

Talent Management: Acquisition & Retention: The Bank of New York Mellon Corporation aims to attract and retain employees by providing a rewarding employee experience, a supportive and safe workplace, and continually evaluating employee engagement and wellbeing programs. It offers a 401(k) plan for U.S. employees (approximately 41,500 participants at December 31, 2024) and other defined contribution retirement plans worldwide. Defined benefit plans are maintained for certain current and former employees, including a frozen U.S. plan covering approximately 6,400 participants and non-U.S. plans (some frozen) covering approximately 18,400 participants. In 2024, eligible employees received an award of 10 restricted stock units ("BK Shares") to foster equity ownership. Employee Value Proposition: The company fosters a high-performance culture and supports employee work/life balance, while embracing flexibility and enhancing culture and commercial impact.

Diversity & Development:

• Diversity Metrics: Belonging is integral to the company's strategy. At the end of 2024, women represented 40% of the global workforce and 43% of the U.S. workforce. Additionally, 39% of the U.S. workforce were from U.S. underrepresented ethnic and/or racial backgrounds. For leadership, 43% of the Executive Committee were women and 26% were from underrepresented ethnic and/or racial backgrounds. The Board of Directors had 45% women and 27% from underrepresented ethnic and/or racial backgrounds.
• Development Programs: The company offers programs and extensive training and development opportunities at key career transition points, from internship to executive management, to help employees advance their careers and progress within the organization.

Culture & Engagement: The company's holistic approach to employee wellbeing provides access to resources for physical health, emotional resilience, financial wellbeing, and social connections. It regularly gathers feedback through an all-employee survey to encourage innovation, show appreciation, and build a more rewarding, inclusive workplace.

Environmental & Social Impact

Environmental Commitments: Climate Strategy:

• Information not provided in filing

Supply Chain Sustainability:

• Information not provided in filing

Social Impact Initiatives:

• Community Investment: Information not provided in filing
• Product Impact: Information not provided in filing

Business Cyclicality & Seasonality

Demand Patterns:

• Information not provided in filing

Planning & Forecasting:

• Information not provided in filing

Regulatory Environment & Compliance

Regulatory Framework: Industry-Specific Regulations: The Bank of New York Mellon Corporation is subject to extensive government rulemaking, policies, regulation, and supervision. Its U.S. banking subsidiaries are regulated by applicable bank regulatory authorities, and their deposits are insured by the Federal Deposit Insurance Corporation. Banking subsidiaries outside the United States are regulated by non-U.S. regulatory authorities in addition to the Board of Governors of the Federal Reserve System. The Bank of New York Mellon SA/NV is authorized and regulated as a credit institution by the European Central Bank and the National Bank of Belgium under the Single Supervisory Mechanism, and supervised by the Belgian Financial Services and Markets Authority for conduct of business rules.

Trade & Export Controls: Information not provided in filing

Legal Proceedings: Information not provided in filing

Tax Strategy & Considerations

Tax Profile:

• Effective Tax Rate: Information not provided in filing
• Geographic Tax Planning: Information not provided in filing
• Tax Reform Impact: Information not provided in filing

Insurance & Risk Transfer

Risk Management Framework:

• Insurance Coverage: Information not provided in filing
• Risk Transfer Mechanisms: Information not provided in filing