The Bank of New York Mellon Corporation (NYSE:BK) reported first-quarter 2026 results Thursday, with shares trading higher following the release after the bank beat analyst expectations on both earnings and revenue.
Diluted EPS rose 42% year over year to $2.24 from $1.58, while adjusted EPS of $2.25 topped estimates of $1.93. Total revenue increased 13% to a record $5.409 billion, exceeding estimates of $5.180 billion.
Pre-tax operating margin expanded to 37% from 32%, and return on tangible common equity improved to 29.3% from 24.2%.
CEO Robin Vince said, “BNY had a strong start to 2026 with record revenue of $5.4 billion in the first quarter, up 13% year-over-year, reflecting broad-based growth across our Securities Services and Market and Wealth Services businesses.”
He added, “We delivered over 800 basis points of positive operating leverage, while investing in new products, capabilities, AI, and – critically – our people and culture.”
Core Financials and Balance Sheet Strength
Fee revenue increased 11% to $3.768 billion, while net interest income rose 18% to $1.37 billion, with net interest margin improving to 1.38% from 1.30%.
Noninterest expense climbed 5% to $3.4 billion, and net income applicable to common shareholders rose 36% to $1.562 billion.
The effective tax rate was 19.1%, including a benefit from stock award vesting.
Average deposits grew 13% to $318.4 billion, and average loans rose 16% to $81.1 billion. Assets under custody and/or administration increased 12% to $59.4 trillion, while assets under management rose 6% to $2.1 trillion.
Segment Performance
Securities Services revenue increased 17% to $2.678 billion, with pre-tax income up 46% to $1.041 billion and margin expanding to 39%. Asset Servicing revenue rose 22% to $2.17 billion, while Issuer Services declined 1% to $508 million.
Market and Wealth Services revenue rose 11% to $1.892 billion, with pre-tax income up 18% to $961 million and margin at 51%, driven by higher activity and balances across Wealth Solutions, Payments and Trade, and Clearance and Collateral Management.
Investment and Wealth Management revenue increased 6% to $825 million, while pre-tax income rose 43% to $90 million, with a margin at 11%.
BNY Capital, Credit, and Returns
Provision for credit losses was a $7 million benefit, reflecting improvements in commercial real estate exposure.
BNY reported a CET1 ratio of 11.0% and a Tier 1 leverage ratio of 6.0%, with liquidity coverage and net stable funding ratios at 111% and 131%, respectively.
The company returned $1.4 billion to shareholders, including $376 million in dividends and $983 million in share repurchases, and authorized a new $10 billion share repurchase program.
BK Price Action: Bank of New York Mellon shares were up 1.80% at $132.74 at the time of publication on Thursday. The stock is trading at a new 52-week high, according to Benzinga Pro data.
Photo by JHVEPhoto via Shutterstock
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