BNY Mellon (NYSE:BK) has reported a strong rise in second-quarter earnings, supported by its Securities Services and Market and Wealth Services businesses.
The financial services posted a 5% rise in total revenue to $4.5 billion for the three months to June 30, 2023, as a 33% increase in net interest revenue made up for a 2% decline in fee revenue.
Securities Services grew revenue by 12%, with a 91% improvement in income before taxes, while Market and Wealth Services reported a 10% rise in revenue and an 8% gain in income before taxes.
The outlier, Investment and Wealth Management, posted a 10% decrease in revenue, with income before taxes falling 38%.
Total earnings per share jumped 26% year-over-year to $1.30, beating the $1.22 consensus forecast from the seven analysts that follow the stock, according to Zacks Investment Research.
“BNY Mellon delivered good financial performance amid a very dynamic operating environment, and we continued taking actions to position the firm for higher underlying growth and enhanced operational efficiency over time,” president and CEO Robin Vince said in a statement.
“Our focus on revenue growth and expense discipline allowed us to drive meaningful positive operating leverage and improve our pre-tax margin to 30% while we continued making significant investments in our future,” he added.
Following the release of the Federal Reserve’s 2023 bank stress test last month, Vince noted that the company increased its common dividend by 14% starting this quarter, and its overall approach to maintaining a high-quality, resilient balance sheet and returning capital to shareholders remains unchanged.
Its shares were down 0.6% at $43.30 ahead of the market open.
Contact the author at stephen.gunnion@proactiveinvestors.com