BNY Mellon 3Q profit grows to $651 million
The Bank of New York Mellon (BK), which has been caught in the middle of RMBS litigation for the past several months, posted a third-quarter profit of $651 million, or 53 cents a share. That is up from last year's earnings of $622 million, or 51 cents a share, and reflects a 9% jump in fee revenue. Still, the company's earnings dropped from the second quarter when it posted a profit of $735 million, or 59 cents a share. In terms of revenue, BNY Mellon said year-over-year its revenue grew 8% to $3.7 billion. In the third quarter, BNY recorded $80 million in litigation expenses and took a $22 million financial hit on executive changes. BNY Mellon's CEO Robert Kelly recently stepped down and was replaced by Gerald Hassell. In addition, BNY Mellon, as trustee in a controversial RMBS transaction, experienced some legal fall-out after proposing a final RMBS settlement with Bank of America (BAC). The $8.5 billion proposed mortgage-backed securities settlement was supposed to end issues over toxic loans packaged into securities that were sold off to investors. However, investors and the New York Attorney General's Office pushed back, filing its own motions to keep the settlement from occurring without considering the needs of other parties. Write to Kerri Panchuk.