The Bank of New York Mellon Corporation’s BK fourth-quarter 2024 adjusted earnings of $1.72 per share outpaced the Zacks Consensus Estimate of $1.56. Also, the figure reflected a jump of 33.3% from the prior-year quarter.

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Further, BK’s total revenues grew 11.2% year over year to $4.85 billion. The top line also beat the Zacks Consensus Estimate of $4.66 billion.

The primary driver of the top line was an improvement in fee income and assets under custody and/or administration (AUC/A) and assets under management (AUM) balance.

Increase in Fee Income Boosts BNY Mellon’s Revenues

Total fee revenues were $3.51 billion, up 9.3% from the prior-year quarter. The increase was particularly driven by all the components except distribution and servicing fees.

BK’s investment services fees (the largest revenue component) grew 8.7% to $2.44 billion in the fourth quarter. Investment management and performance fees rose 8.7% to $808 million.

The rise in both the abovementioned metrics was driven by improvement in AUM and AUC/A balances. As of Dec. 31, 2024, AUM was $2.03 trillion, up 3% year over year, and AUC/A was $52.1 trillion, up 9%. The growth primarily reflected higher market values driven by a global market rally in the quarter, partially offset by an unfavorable impact of a strong U.S. dollar.

Similar to BK, its peers – JPMorgan JPM and Citigroup C – witnessed improvements in non-interest income in the fourth quarter. This resulted in a rise in revenues for both companies.

For BK, other fee income components, financing-related fees and foreign exchange revenues jumped 17.8% and 23.8%, respectively, in the fourth quarter of 2024. However, distribution and servicing fees declined 9.8%.

Additionally, BK’s net interest income (NII) on a fully taxable-equivalent (FTE) basis increased 8.4% to $1.20 billion on a year-over-year basis. The rise was driven by higher investment securities portfolio yields and balance sheet growth, partly offset by changes in the deposit mix.

Further, total non-interest expenses (GAAP basis) were $3.36 billion for BNY Mellon, down 16%. The decline was due to a fall in costs related to staff charges, net occupancy charges, distribution and servicing costs, business development costs and bank assessment charges. Adjusted expenses rose 2.4% from the prior-year quarter to $3.19 billion.

In the fourth quarter, this Zacks Rank #3 (Hold) company recorded a provision for credit losses of $20 million, declining 76.2% year over year. Likewise, JPM and C recorded a decline in their provisions for the quarter.  You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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