Bank of New York's
Bank of New York reported net income of $434 million, or $0.57 per share, in the first quarter, compared to $422 million, or $0.55 per share, in the prior year. Results from continuing operations showed a more substantial improvement in earnings, reflecting the growth in both assets under custody and assets under management. On an adjusted basis, which excludes merger charges recognized during this year's first quarter, earnings from continuing operations measured $449 million, or $0.59 per share, compared to $360 million, or $0.47 per share, in the prior year.
In a separate announcement, Mellon reported income from continuing operations of $243 million, or $0.58 per share, in the first quarter, compared to earnings of $193 million, or $0.47 per share, in the prior year. Echoing the results reported by its merger partner, Mellon disclosed that its custody and management fees increased thanks to higher values of underlying assets. Such fees represent the bulk of revenues earned by both banks, which helps insulate them from the problems of tight interest rate spreads and declining credit quality that are now pressuring most traditional banks.
Bank of New York and Mellon Financial plan to hold separate meetings of shareholders May 24 to approve their merger plan. As a result of the enhanced scale and operating leverage that the combined firm would achieve, shareholders should feel confident that steady profit growth will continue.