Seeking Alpha
We cover over 5K calls/quarter
Profile| Send Message|
( followers)  

The Bank of New York Mellon (NYSE:BK)

Q3 2012 Earnings Call

October 17, 2012 8:00 am ET

Executives

Andy Clark

Gerald L. Hassell - Chairman, Chief Executive Officer, President, Member of Executive Committee, President of the Bank of New York and President of the Mellon Bank NA

Thomas P. Gibbons - Vice Chairman and Chief Financial Officer

Curtis Y. Arledge - Chief Executive Officer

Timothy F. Keaney - Vice Chairman and Chief Executive Officer of Asset Servicing

Karen B. Peetz - Vice Chairman, Chief Executive Officer of BNY Mellon's Issuer, Treasury & Broker Dealer Services and Chief Executive Officer of Financial Markets & Treasury Services

Arthur Certosimo - Senior Executive Vice President and Chief Executive Officer of Alternative and Broker-Dealer Services

Analysts

Cynthia Mayer - BofA Merrill Lynch, Research Division

Michael Mayo - Credit Agricole Securities (NYSE:USA) Inc., Research Division

Kenneth M. Usdin - Jefferies & Company, Inc., Research Division

Betsy Graseck - Morgan Stanley, Research Division

Brian Bedell - ISI Group Inc., Research Division

Alexander Blostein - Goldman Sachs Group Inc., Research Division

Luke Montgomery - Sanford C. Bernstein & Co., LLC., Research Division

Howard Chen - Crédit Suisse AG, Research Division

Gerard S. Cassidy - RBC Capital Markets, LLC, Research Division

Operator

Good morning, ladies and gentlemen, and welcome to the Third Quarter 2012 Earnings Conference Call hosted by BNY Mellon. [Operator Instructions] Please note that this conference call webcast will be recorded and will consist of copyrighted material. You may not record or rebroadcast these materials without BNY Mellon's consent. I will now turn the call to Mr. Andy Clark. Mr. Clark, you may begin.

Andy Clark

Thanks, Charlene. Welcome, everyone. With us today are Gerald Hassell, our Chairman, President and CEO; Todd Gibbons, our CFO, as well as several members of our executive management team. Before we begin, let me remind you that our remarks today may include forward-looking statements. Actual results may differ materially from those indicated or implied by the forward-looking statements as a result of various factors. These factors include those identified in the cautionary statement on Page 13 of the press release and those identified in our documents filed with the SEC that are available on our website, bnymellon.com. Forward-looking statements in this call speak only as of today, October 17, 2012, and we will not update forward-looking statements. Our press release and earnings review are available on our website, and we will be using the earnings review to discuss our results. Now I'd like to turn the call over to Gerald. Gerald?

Gerald L. Hassell

Thanks, Andy, and good morning, everybody, and thanks for joining us. As you've seen from the release, for the third quarter, we generated net income of $720 million and an earnings per share of $0.61. Now that did include the benefit of approximately $0.04 per share from a lower tax rate. As a reminder, we reported $0.53 per share in the third quarter of last year.

In a macro environment that continues to present challenges to all of us, we are winning new business, investing in organic growth opportunities, delivering on our operational excellence initiatives, improving on our already strong capital position, continuing to return capital shareholders and at the end of the day, our core revenues were up 2%, and core expenses were flat.

We were particularly pleased with the strength of our investment management area, which benefited from strong investment performance and a 12th consecutive quarter of long-term flows. We had $58 billion in net long-term flows over the last 12 months, which included $9 billion during the third

[Audio Gap]

helped drive assets under management to a record level of $1.4 trillion. And during the quarter, we received a number of industry awards, which is very, very gratifying. Insight was named the Fixed Income firm of the year and LDI firm of the year by Financial News. ARX, our Brazilian investment manager, was awarded Active Equity Manager of the Year, and the BNY Mellon Emerging Market Debt Fund was named Emerging Market Debt Fund of the Year.

We also purchased the remaining 50% of our West LB Mellon Asset Management joint venture, which further strengthens our franchise in Germany. We combined some of our Standish fixed income activities with Alcentra to create a world-class and sizable manager of credit strategy.

We also announced plans to combine our Pareto currency risk management boutique with Insight to creating one manager of risk management solutions. So there's lots of good things occurring in investment management.

Turning to Investment Services, we also benefited from new business, as well as typical seasonality in Depositary Receipts. In Asset Servicing, we had more than $520 billion in new assets under custody wins. Now with market values increasing and conversions to prior business won, assets under custody reached a record level of almost $28 trillion. Also during the quarter, we fully integrated the BHF Asset Servicing business onto our systems. So we are in fact integrating and retiring legacy platforms. And feedbacks on our newly formed global services organization has been overwhelmingly positive, as clients struggle to meet the current and emerging requirements of Dodd-Frank.

Now offsetting some of these positives were seasonal reductions in volumes that affected our foreign exchange and clearing businesses. Also, Corporate Trust continues to be negatively impacted by low levels in new issuance versus a natural retirement of existing securities. We continue to make good progress on our operational excellence initiatives, which are focused on providing great client service while improving productivity and reducing risk. And on the capital front, we generated strong returns on tangible equity, continue to return capital to shareholders and improve our already strong capital position.

Now going forward, we remain very focused on capitalizing on our core -- organic growth opportunities identified within our company that can help clients grow and navigate the current environment. Now there are some great examples of this. Take global collateral services where we're seeing real exciting opportunities. We're working to leverage the tremendous power of our Pershing distribution capability for our investment management products, and we're doing this globally, as we believe our technology and distribution platforms export well around the world. And we're also building on our trading capabilities to better service our clients to provide more opportunities to capture trading flows for a variety of instruments. We're a great counterparty and some natural extension of our business.

So while we're certainly pleased that our core businesses are growing and we're succeeding in capturing new business and controlling our expenses, we're also creating our own long-term revenue growth capabilities. Now it's also imperative for us to focus on the great ideas and opportunities that exist in-house and to relentlessly manage our cost base to improve EPS performance.

With that, let me turn it over to Todd to go through the numbers.

Thomas P. Gibbons

Thanks, Gerald, and good morning, everyone. My comments as usual will follow the Quarterly Earnings Review that begins on Page 2. Reported earnings per share was $0.61. That compares with $0.39 last quarter, but remember that last quarter included litigation charges of about $0.18. The $0.61 includes the benefit of approximately $0.04 from a lower-than-expected effective tax rate, is also $0.03 due to elevated other income and lower provision.

Looking at the numbers on a sequential basis, total revenue was $3.7 billion. That's up 2%, while fee and other revenue was also up 2%. Investment management fees, investment services fees, investment and NIR were each up, and those were partially offset by declines in FX revenue. Expenses were flat and if you exclude M&I litigation and the restructuring charges as well as expenses related to the Shareowner Services, which we sold at the end of last year. Year-over-year on that same basis, they were up 2%. The increase was a result of the cost of certain tax credits that we had in this third quarter that provided a meaningful benefit to the bottom line and helped our effective tax rate.

Turning to Page 4 where we'll call out some business metrics that will help explain our underlying performance. You can see that assets under management of $1.359 trillion was up 5% sequentially and 13% year-over-year. That's resulting from higher market values but also good inflows.

During the quarter, we had net long-term inflows at $9 billion and short-term inflows of $9 billion as well. It was our 12th consecutive quarter of positive long-term inflows with flows of $58 billion over the last 12 months. Assets under custody and administration was up 3% sequentially to a record level of $27.9 trillion. That was driven by higher market values and net new business. Assets under custody is up about 8% on a year-over-year basis.

Now looking at a number of our key metrics showed growth on a year-over-year basis. Collateral management balances continued to grow. They surpassed $2 trillion for the first time, and global payment volumes were also up about 2%. Wealth management loans and deposits were up for the year as well. Clearing metrics were mixed with DARTS down significantly, both sequentially and year-over-year, while average long-term mutual fund assets were up.

Going on to look at fees on Page 6. Assets Servicing fees were down 1% sequentially. That's largely driven by the seasonal decrease in securities lending revenue and partially offset by net new business and higher market values. Asset Servicing fees were up 2% year-over-year, primarily reflecting net new business and higher market values and securities lending revenue. We had $522 billion in new assets under custody wins, our best new business quarter since 2008. AUC wins totaled more than $1.7 trillion over the last 12 months, of which approximately $740 billion remains to be converted, with half of that expected to be converted between now and year end and the remainder during the first half of 2013.

Issuer service fees excluding the Shareowner Services business were up 13% sequentially and down 22% year-over-year. The sequential increase resulted from seasonally higher DR revenue related to corporate actions, partially offset by lower Corporate Trust fees. The year-over-year decrease largely resulted from lower DR revenue driven by lower volumes and lower Corporate Trust fees reflecting the continuing net runoff of structured debt securitizations. This runoff could reduce the company's total revenue over the next few quarters by about 50 to 70 basis points assuming the structured markets do not recover.

Clearing fees, which are more activity sensitive were down 7% sequentially and 3% year-over-year. Both decreases were principally driven by lower DARTS volumes, reflecting the sharp decline in share volume on both the New York Stock Exchange and NASDAQ, which was down 31% year-over-year and 10% sequentially on a combined basis.

Investment management fees, excluding performance fees, were up 3% sequentially and 7% year-over-year. Both increases were driven by higher market values and new business. The strong performance of the boutiques continues to attract long-term flows. In FX and other trading, revenue was up 1% sequentially and down 9% year-over-year. Looking at the components of FX, looking at the components underlying that, FX revenue totaled $121 million. That's a decrease of 23% sequentially and 45% year-over-year. Both decreases were driven by lower volatility and lower volumes.

Other trading revenue was $61 million compared with revenue of $23 million in the second quarter and a loss of $21 million in the year-ago quarter. Both increases reflect improved fixed income trading, as we benefited from the development of our trading capabilities as well as our strong counterparty status. Investment and other income totaled $124 million in the quarter. That compares with $48 million in the prior quarter and $83 million a year ago. Both increases primarily resulted from higher seed capital gains and higher equity's investment revenue.

Turning to Page 8 of the earnings review, NIR was up $15 million sequentially and down $26 million versus the year-ago quarter. The sequential improvement reflects higher interest earning assets driven by very large deposit levels and is partially offset by the elimination of interest on the ECB deposits. The year-over-year decrease in net interest revenue was principally driven by lower yields, the elimination of interest on ECB deposits, and it was partially offset by the increased investment in high-quality investment securities. The net interest margin was 1.20% compared with 1.25% in the second quarter and 1.30% in the year-ago quarter. Both decreases mostly reflect lower reinvestment yields, primarily driven by accretion as well as the significant increase in customer deposits.

Turning to Page 9, you can see that we exhibited good expense control. Total noninterest expenses, including amortization of intangible assets, M&I litigation and restructuring charges as well as the expenses related to Shareowner Services was flat sequentially and up 2% year-over-year. Sequentially, the decreases in professional, legal and other purchase services and business development expenses were offset by the annual employee merit increase that took effect on January -- July 1. On a year-over-year basis, after adjusting for the benefit for -- excuse me, the cost of generating tax credits in the third quarter of 2012 and the benefit of a state investment tax credits recorded in the year-ago quarter, expenses were flat.

On Page 10, you can see the progress we've made on our operational excellence initiatives. On a gross basis, our efforts during the quarter resulted in $105 million in quarterly run rate savings and incremental program cost totaling $23 million or net savings of $82 million. Year-to-date, we generated net savings of $223 million. That's a bit ahead of the plan we disclosed last year.

We had some key events this quarter that contributed to our progress in meeting the operational excellence goals for this quarter and will have a greater impact as we move forward. For example, we're more fully leveraging the Eastern European operation. This came with some GIS acquisitions, which for the first time, gave us a low-cost operation where we can service European clients from their own time zone. In addition, we completed our final BHF client conversions as Gerald alluded to earlier. And in corporate services, we consolidated offices in London and Amsterdam and continue to benefit from the enhanced global procurement program. By year end, we do expect to be well within the range of our targeted net savings.

Page 11 details our capital ratios. Our estimated Basel III Tier 1 common equity ratio was 9.3% at quarter end. That's up 60 basis points, with the increase chiefly attributable to the stronger earnings and the increase in the value of the investment portfolio. Our Basel I Tier 1 capital ratio is at 15.3%, also up 60 basis points. We benefited from a very attractive market and issued $550 million of fixed rate, non-cumulative perpetual preferred stock that qualifies as a Basel III Tier 1 capital, and we're very pleased that the coupon was at the lowest rate for a bank-issued, non-cumulative perpetual preferred.

On Page 12, you can see that the market value of our investments securities portfolio increased from last quarter. The pretax net unrealized gain on our securities portfolio was up by more than $1 billion to about $2.5 billion, reflecting a decline in interest rates and improved credit spreads. We did take advantage of the strong market to sell a few securities that we thought were priced a bit rich.

Looking at our loan book on Page 13, you'll see that the provision for credit losses was a credit of $5 million compared with a credit of $19 million in the second quarter and a credit of $22 million in the year-ago quarter. The credit primarily resulted from a gain on loan sales as well as repayments. The portfolio continues to perform very nicely, and as you can see, NPAs continue to decline. The effective tax rate was 23.1%, and that primarily reflects the benefit from completing various tax audits.

Now a few points to factor into your thinking about the fourth quarter. In terms of NII, we think we can maintain something between the second and third quarter levels. We would expect seasonally lower DR fees and seasonally higher investment management performance fees. The quarterly provision should be around 0 and give or take a few million. And the operating tax rate in the third quarter of 2012 should be approximately 27% to 28%. We continue to invest in organic growth as Gerald had mentioned. We're maintaining our strong balance sheet, and we're driving expense savings through our operational excellence initiatives.

With that, let me turn it back to Gerald.

Gerald L. Hassell

Thanks, Todd, and perhaps now we can open it up for questions.

Question-and-Answer Session

Operator

[Operator Instructions] Our first question comes from Cynthia Mayer with Bank of America Merrill Lynch.

Cynthia Mayer - BofA Merrill Lynch, Research Division

I guess, just to expand on your guidance on NII, I think you said something between 2Q and 3Q. Is that right?

Thomas P. Gibbons

That's correct, Cynthia.

Cynthia Mayer - BofA Merrill Lynch, Research Division

And I guess as part of that, what would be your outlook for NIM? I think last quarter you predicted it would fall a few basis points, and I guess it's up 5. What is your outlook there?

Thomas P. Gibbons

Yes, as we said in the past Cynthia, we're not managing to NIM. We are managing to NIR. So we're willing to take on deposits and place them at the fed even though that generates a very low NIM because you can only get 25 basis points on that. So our focus, again, has been to drive NIR up or keep it stable in this kind of an environment. All that being said, I think if you were to hold the balance sheet constant and the interest environment stayed depressed at this level, you would see some continued contraction over the course of the next 12 months in the NIM.

Cynthia Mayer - BofA Merrill Lynch, Research Division

Okay. Great. Now on the Asset Management side, you guys had $9 billion in long-term inflows, which is great. Can you talk a little about where you're seeing those coming from? And are you seeing any particular strategies as you look ahead, which are really driving the flows?

Curtis Y. Arledge

Yes. Cynthia, it's Curtis Arledge. The flows that we saw on the third quarter -- first of all, the third quarter isn't typically an extremely strong quarter in terms of new mandates. But having said that, it was substantially better than a year ago. The $9 billion had -- definitely had an index component to it. About $5 billion of the $9 billion came from index strategies. Active strategies in both fixed income and equities did get some inflows. I would tell you that our dialogue with clients in terms of where they're going with money is I'd described it the following way: We've had good discussions and good investments by clients in strategies that are volatility and risk dampening. So we see clients that have equity strategies looking to do things like long/short, and absolute return strategies have absolutely been -- absolute return has absolutely been an area where clients have been moving. There also has been a movement in -- among equities to move and diversify away from the U.S. As U.S. markets have done better, we've seen clients that have moved some of their portfolio and diversified to be more global. The emerging market, that story has been a place where people have gone looking for yield. That's been a pretty consistent story for the past several quarters. I would tell you that I think that this -- we have a lot of clients. This isn't -- and it's probably true across the board in a lot of businesses, but a lot of our clients are definitely watching and waiting to see how both the election and the fiscal cliff get dealt with. So our pipelines are pretty constant, but I think the dialogue is going to be very much driven by sort of how the next several months play out. I think a lot of clients actually want to do things, but there's just so much uncertainty. They're waiting to see how things go.

Cynthia Mayer - BofA Merrill Lynch, Research Division

Okay. And maybe last question is it looks like your headcount ticked up, which seems maybe at odds with some the rationalizations you have, you highlight and the expense controls. I'm just wondering what accounts for that.

Gerald L. Hassell

Sure, Cynthia. It's 2 main things. One is as we migrate some of our jobs to some of our global centers around the world, there's a little bit of bubble headcount associated with that. But most of it's associated with insourcing contractors, particularly on the software application side. We've been using third-party contractors. We decided it's much more efficient. And frankly, we retain the intellectual property and intellectual capacity of the talent by insourcing it rather than using third-party contractor. So there's a benefit both on the cost side as well as retaining the talent.

Thomas P. Gibbons

And that's why you don't see -- even though you see that number go up, you're not seeing an increase in salaries.

Operator

Our next question comes from Mike Mayo with CLSA.

Michael Mayo - Credit Agricole Securities (USA) Inc., Research Division

I'm asking about the bloodbath on servicing fees side, and this is not a new question. It just keeps getting worse and worse. So if I look at your servicing fees including foreign exchange securities lending this is the lowest percentage of those fees to assets under custody in your history, and you're also seeing that at the other processing banks, too. So we always ask this question. What are you doing? What can you do to stem the margin pressure in the core servicing business?

Gerald L. Hassell

So I'll make a couple of comments, Mike, and then perhaps turn it over to Tim. So a couple of things that we're doing: We are seeing better recovery on securities lending, and we're being more active there. And I think the numbers speak for that both in terms of securities on loan as well as the year-over-year improvement in that category. So we are seeing securities lending being reactivated in the marketplace, and we're being more active on that front. Tim will talk in a moment what he's trying to do on the core Asset Servicing side, where you're seeing certain kinds of fees move, and the core fees have actually moved up. But you're correct. They haven't moved up totally in line with assets under custody, and Tim will talk to that perhaps in a moment. And on the trading and foreign exchange side, we are investing on our trading activities and various electronic platforms in order to capture more flows that go through our fingertips. And so we're not going to rely on foreign exchange coming back to the degree that it did, but we are investing in the businesses to capture more of the other instruments that are traded naturally by our clients. And we think an opportunity gain some of that traction and some of the revenues around that will improve the overall returns on the business. So with that, maybe I'll turn it over to Tim.

Timothy F. Keaney

Yes. Gerald, thanks. Mike, Tim Keaney. A couple of things, first of all, we're going back to repricing as I said on previous few calls. We started off Broadway with smaller clients, which is now done. That's not a needle mover, but it's a step in the right direction. We're moving up the chain to larger clients, as their contracts come up for review. We've had 29 of our larger clients out of 29 successfully repriced with about a 20% uptick in core fees, and we're just going to stay at that. That's probably going to take us about 3 years to go through the whole cycle, as contracts come up for review. But more to your question of the disaggregation between growth and AUC, I might just comment on that for a second. Year-over-year, we saw a huge amount of de-risking. We see about a third gearing for us to market and as Todd mentioned, a significant portion on the year-on-year uptick in AUC with market. We also had a little bit of a mix issue where about 60% plus of our assets under custody are geared towards fixed income. But I will make one other point. We have maintained pricing discipline, we do have some large clients year-on-year, particularly in Europe, that are coming through because we are maintaining absolute strict pricing discipline. So I think you do see that pulling through and also the mix in new business that we're winning. We do see a significant portion of new business coming from outsourcing and transfer agency that are key pillars for us, and that really isn't geared to AUC, and last point, we still have half of what we've won yet to convert.

Gerald L. Hassell

Yes. I'd say one other final comment, Mike, in terms of what are we doing. The effort that we're putting into and the resources around collateral services, global collateral services is for real, and we do see that as a real opportunity to capture revenues around assets that are within our custody base. And so I think that's going to be an opportunity for us to gain fee revenues off of the current client base.

Michael Mayo - Credit Agricole Securities (USA) Inc., Research Division

All right. Just a -- one follow-up, so more products I understand that, whether it's trading or more securities lending. You repriced off Broadway. I understand that. But I'm sorry, what was 29 out of 29?

Timothy F. Keaney

Yes, 29 out of 29 of our larger clients has their contracts come up for review Mike. We renegotiate higher fees.

Michael Mayo - Credit Agricole Securities (USA) Inc., Research Division

But I thought you said on a recent presentation that you don't have pricing power with strategic clients?

Timothy F. Keaney

Yes, Mike. Let me -- it's a good question. Our largest 100 clients, roughly 100 clients are super large, multi-product users of our services. That is much more about cross selling and share wallet and introducing some of the new things that Gerald mentioned. Collateral would be a great example, some of the things that Art's building into that client base. We have no pricing power with those names. But all the clients below those names, we have plenty of opportunity to up price.

Michael Mayo - Credit Agricole Securities (USA) Inc., Research Division

No, I'm sorry. I'm just reconciling the largest 100 clients where you don't have pricing power but you're looking to cross sell with 29 of 29 of your larger clients. Which larger clients are those if they're not 1 of the 100 largest?

Timothy F. Keaney

Yes, think of those clients as kind of 3 million and below.

Gerald L. Hassell

Mid-sized.

Timothy F. Keaney

Yes, mid-sized clients, and that's the best way I would describe it, Mike.

Michael Mayo - Credit Agricole Securities (USA) Inc., Research Division

All right. That's clear. But to what percentage of your revenues come from your largest strategic clients? Wouldn't that be, I'm just guessing, 2/3?

Timothy F. Keaney

Yes, I don't have that stat handy. I would just say it's a very large percentage of our fees. Yes.

Michael Mayo - Credit Agricole Securities (USA) Inc., Research Division

So we're really talking about repricing for that last 1/4 to 1/3 and then cross selling for the other 2/3 to 3/4. Is that a fair characterization?

Gerald L. Hassell

Yes, more or less, Mike. That's right.

Operator

Next question comes from Ken Usdin with Jefferies.

Kenneth M. Usdin - Jefferies & Company, Inc., Research Division

So it seems like the operational excellence program continues to do a little bit better than expected for the last couple of quarters. You've had net benefit. So just wondering if you can give us an update on are you accelerating some of the saves. And at this point, how good do you feel about meeting, if not, even perhaps, beating the initiatives that you've laid out?

Thomas P. Gibbons

Yes, I think there are a couple of things going on. We do feel pretty good about the timing. A couple of things have worked out, and some of the investments that we thought we would need to make are a little bit less than what we had first expected. In the fourth quarter, we are looking at continuing to invest in some actions that will generate ongoing benefits especially around the real estate side. So we wouldn't expect the bottom line to be as great as what we've seen in the past couple of quarters, Ken. That's why we're kind of guiding you to stay within the range that we had projected.

Kenneth M. Usdin - Jefferies & Company, Inc., Research Division

Okay. And then if I can just ask a couple of just small, tiny questions, can you tell us what accretion was this quarter and also just what the magnitude of fee waivers was or the delta in fee waivers?

Thomas P. Gibbons

Sure. Accretion was down about $7 million or so, Ken, and that's about the quarterly run rate we would expect. In other words, it should continue to come down at about that level. So I think it was around $67 million or something -- $67 million thereabouts. And your second question was around fee waivers. The delta on fee waivers is very slightly improved. Now I'd already projected the trough 3 times previously, so I'm not going to project it again, but maybe we have gone through it.

Kenneth M. Usdin - Jefferies & Company, Inc., Research Division

Okay. And then my last question is just regarding some of the fee income items were really strong this quarter, and I don't want to call them non-core, but maybe they might be -- but they look to be a little bit above trend. I just wanted to ask specifically on investment and other income and even on the fixed income trading took some comments you made earlier. How do we get an understanding of what kind of like good forward-looking run rates are in those areas? Or are they at a point where you're just starting to harvest more on both of those areas?

Thomas P. Gibbons

Okay. Sure. So why don't we start with the fixed income and other trading. We have been investing in that as Gerald had indicated, and I think we had given some indication in the past that we thought that line would be around $50 million. I think there's opportunity for that to be a bit higher than that on a go-forward basis. And I think we've demonstrated a little bit of that in this quarter. But there will be some volatility around that, as you would expect, Ken. In terms of the investment and other income, we had given, I think, guidance in the past that if you look through those -- and we give a lot of disclosure in the earnings review of those -- if you look through the portfolio of items there, we would expect about $80 million to $85 million in core, but it seems like we've been seeing -- we've been harvesting some things or getting some benefits. There were seed capital that can be a bit volatile, and we did crystalize some gains on our seed capital this quarter. But I would -- I'd still target around that level and understand that there can be $20 million or $30 million of upside or downside to it.

Operator

Our next question comes from Betsy Graseck with Morgan Stanley.

Betsy Graseck - Morgan Stanley, Research Division

Gerald, I wanted to dig in a little bit on the collateral management opportunity set that you indicated a little bit earlier in the call. You talked about it being a fee revenue generator. If you could speak to how you think about sizing that and generating that. And then the other question is whether or not there's any capital impact from the collateral transformation process that you're suggesting?

Gerald L. Hassell

Okay, great. The fee side of it is, it is all fee-based so that's the good news. We are seeing increasing opportunities. I think we have one in the metrics on our tables, our assets collateralized, tri-party collateral, continues to move up. And we are seeing progress there. The dialogue with our clients, particularly I'd say the buy side, has dramatically increased because they're realizing what they're facing in terms of having to post collateral to either today or in the future as the regulations get crystallized around all their various trading activities. And so the dialogues are quite productive. It's still early stages in terms of the fee revenues that we're seeing actually translate or show up in our own revenue stream. So -- but we are optimistic and hopeful that this will be a significant item in the future. The timing of it's a little bit unpredictable because the regulations are still being written, but the level of activity and dialogue is quite real, and we are spending the money now investing in the technology, which is absorbed in our running rate on expenses, to be able to capture that opportunity. So we feel good about the future here.

Thomas P. Gibbons

And Betsy, you'd ask about capital. And this is Todd, I'll take that. If you look at the various activities, they tend to be very well collateralized, I mean that, to us, wherever we act as a principal. So if it's securities finance or actual lending, we get collateralized with good securities at a reasonable margin. And on a risk-based -- a risk-weighted asset, they tend to be very, very low, so they can be easily absorbed into our balance sheet. It's a better allocation of our -- if it is coming onto our balance sheet, it's a better use of our deposit base than keeping it at the Fed or in cash in other banks.

Betsy Graseck - Morgan Stanley, Research Division

Okay. And is there, as part of this also, people presenting to you potentially things like corporate bonds, let's say, and then your lending on securities to -- treasuries or GNEs [ph]?

Gerald L. Hassell

Yes. That is one of the potentials of "asset transformation", taking ineligible assets and creating them into eligible assets, and that's something that we are taking a look at. We think we have the expertise internally to be able to be able to value and look at that kind of collateral. And with proper margining with the proper counterparties, we think it's a good way to use our balance sheet and to support our clients. So yes, that is something we are looking at.

Betsy Graseck - Morgan Stanley, Research Division

Okay. And that's in addition to the fee capture that you discussed earlier?

Gerald L. Hassell

That's correct. That's on top of the fees associated with collateral services. Tim, you had a comment?

Timothy F. Keaney

Yes. Betsy, it's Tim. Just one other point I'd add. The flip side to not being geared on the asset side, the custody side as much to the equity market as we'd like is the huge amount of treasuries that we have in assets under custody and the majority of our clients that are in our securities lending program. So we think one of the areas that will benefit greatly from this kind of vertically integrated unit that we put in place will directly benefit our clients because of the amount of AUC we have in treasuries.

Operator

Our next question comes from Brian Bedell with ISI Group.

Brian Bedell - ISI Group Inc., Research Division

Let's go back to the Asset Servicing question on the fee realization rates. Tim, maybe if you could just characterize the nature of the mandates that you've won in the $522 billion of wins this quarter. And then just, again, remind me of how much you have left to install into the fourth quarter. And are you bringing mandates in there that have somewhat of a lower fee capture that skews that rate? I know you did talk about the outsourcing wins that helped it, but just trying to get a sense of sort of that administered balance function relative to the revenue going forward.

Timothy F. Keaney

Sure. Thanks, Brian. Yes, we won $520 billion, which was a great quarter, a continuing trend now for several quarters. As its financial institutions, particularly fund managers, most of it was growing current client relationships as part of our strategy where we move up out on the value chain. And so we continue to see things like sub-accounting, where we converted $6.1 million sub-accounting fees -- sub-accounting accounts, which is not geared to AUC. We continue to win transfer agency and middle-office outsourcing, and we make sure that we get paid our minimum target margins. The challenge and this is showing up in the $740 billion we haven't converted yet, is it just takes a little longer to convert. It's a much more mechanical process. So we still have $740 billion to convert. I think Todd mentioned the stats. 50% will convert in the fourth quarter and then the remainder equally over Q1 and Q2 next year. So I don't want you to be overly concerned on the mix because, as we've said, we're not going to dig the hole any deeper for us by lowering our margins for these products. We're maintaining strict disciplines on minimal margins.

Brian Bedell - ISI Group Inc., Research Division

It sounds like combined with the repricing that you mentioned earlier, I think you said up 20% for those 29 clients. Is that correct?

Timothy F. Keaney

That's up 22%, Brian.

Brian Bedell - ISI Group Inc., Research Division

22%, yes. So combined with that, it sounds like on a go-forward basis as we move into 2013, given the mix of those wins, we should be thinking somewhat of a higher core asset servicing realization rate on that asset mix. Is that...

Timothy F. Keaney

Yes, I think that's right, Brian.

Gerald L. Hassell

And again, Brian, the metric that we keep focused on is that fee revenue to operating expenses. Our goal -- we're being very disciplined about getting our above that 100% mark on fees versus operating expenses, and that's the best metric to continue to focus on for us and that's in this space.

Brian Bedell - ISI Group Inc., Research Division

Okay, great. That's helpful. And then, Todd, just on the balance sheet, you talked about, obviously, in this low rate environment, some potential NIM pressure going to 2013. Can you just talk about the -- your strategy on the securities portfolio in terms of what types of things you're investing in, I guess with particular attention to agency MBS. Obviously, deals there are pretty low right now. I mean 15-year yields are below 1%. Are you altering that strategy going forward? Or is that part of the NIM compression story?

Thomas P. Gibbons

Sure. In terms of the agency RMBS, I think QE3 has made certainly the fixed agency RMBS a much less attractive asset. So we actually did get ahead a bit on our allocation to agencies before QE3 came about, and that's worked pretty well for us. So I don't think you're going to see us buying a whole lot of fixed agency RMBS because of the yield declines post to the Fed's announcement. We will continue to purchase and we haven't completed our full allocations to munis. There are some corporates both in the U.S. and abroad that we're looking at, some floating rate asset-backed securities. We kind of like CLOs, covered bonds. And we are looking at agency floaters in the quarter. For example, we did buy some agency floaters.

Brian Bedell - ISI Group Inc., Research Division

Okay. Finally, just remind us of the portfolio duration.

Thomas P. Gibbons

Portfolio duration is -- it's under 2 years. It's probably about 1.75 right now.

Brian Bedell - ISI Group Inc., Research Division

Okay, great. And then just on the money market fee waivers, the cents per share that, that's impacting you?

Thomas P. Gibbons

It's still in the $0.05 or so per share, maybe $0.05 or $0.06 or $0.04. It moves a little bit, but it hasn't moved much. We've kind of gone to that level and haven't seen a whole lot of change. There was one quarter we saw it got a little bit better but not a lot.

Brian Bedell - ISI Group Inc., Research Division

Okay, great. And then just lastly on the foreign exchange trading. You had a very good quarter, the second quarter, up much more than peers. This quarter, you're down a little bit more than peers. Were there just something that caused that elevation in the quarter? Or is there a different explanation for that?

Thomas P. Gibbons

Well, in the third quarter, and we have started to give you a market disclosure, which shows the level of volatility in the market and volatility is the driver of our profitability, and there really is no volatility in the major currencies, and we probably attribute that to the central banks keeping everybody pretty much in line with their currency. So this is a direct impact of fewer volumes. There's less trading activity that took place in the third quarter. You can see that in the stock exchange metric. Even though that's not a direct correlation, it tends to be correlated. Much lower volatility and that's a direct reflection in our numbers. I don't know Gerald, you have anything to add?

Gerald L. Hassell

No, no. I think it's -- for this quarter, it was right in line or unfortunately, negatively in line with the volatility index. So I don't think, based on what we've seen so far, that our foreign exchange trading was any different than anyone else's, particularly associated with the volatility or lack thereof.

Brian Bedell - ISI Group Inc., Research Division

Okay. And then just on the mix between custody and negotiated FX.

Thomas P. Gibbons

It's actually quarter-to-quarter sequentially, essentially the same. The "standing instruction" remains about 9%. It was the same percentage as last quarter. It hasn't dipped down, so it's still a valuable product to our clients.

Operator

Our next question comes from Alex Blostein with Goldman Sachs.

Alexander Blostein - Goldman Sachs Group Inc., Research Division

I want to follow up on the collateral management opportunity that you talked about. It's clearly big numbers. All of a sudden, the buy-side estimate came out with budget collateral, and we also talk about it. But when you look at the ultimate revenue opportunity, can you help us understand? I guess, like when you're sitting and negotiating the fees or the way you envision it to happen, clients are getting squeezed from a lot more things that they have to do, the cost of money. Do you think that's going to be a meaningful area for you to drive, I guess, incremental profitability, given the fact that it probably might be difficult to negotiate on meaningfully there?

Gerald L. Hassell

Yes, I think, it is because there's multiple levels to collateral services. There's the basic level of segregating the collateral, i.e. custody. There's transforming the collateral that we've talked about that Betsy asked the question on. There's optimizing the collateral within the day or over a period of time during which the collateral is being posted. Many of these things, particularly on the optimization side and the transformation side, actually can reduce the capital cost to both sides, both to dealer side and the buyer side. And when you reduce capital costs, there is ability to get some good revenues out of that. So don't think of it just in terms of a transaction, think of it in terms of how it improves the capital costs associated with the collateral being posted both on the buy side and the sell side.

Alexander Blostein - Goldman Sachs Group Inc., Research Division

Got it, helpful. And then, Todd, I was hoping you could run through issuer services just one more time. It feels like underneath the surface, seasonally strong quarter but I guess some things were a little bit slower than normal. Can you give us a sense, I guess, heading into the fourth quarter, what's a good run rate for that revenue bucket is?

Thomas P. Gibbons

Sure. Let me give a high level, and then I can ask Karen, who runs the business, to give a little more detail. It is seasonal. The third quarter tends to be a dividend and corporate action season for our business now. The delta from last year's second to third quarter to this year's second to third quarter was down quite a bit, so we did see the bump but not nearly to the extent that we saw last year. And we'd expect the delta from the third to the fourth quarter for our DR business to follow that. It will be down, but not to the same extent. So it's going to be falling but from a bit of a lower level. So the -- and Karen can give you some of the reasons. That's a super cyclical business, and it's becoming more and more of an emerging market equity business. In terms of Corporate Trust, we're just seeing a little faster runoff of old deals versus new deals that are coming on. And unless we see something -- some come back in the structured finance market, that's primarily what's driving that, we are seeing some decent action CLOs again. But unless we see some comeback in the rest of the structured finance market and non-agency mortgage market, we could see this trend for a number of quarters. So Karen, do you have anything to add to that?

Karen B. Peetz

Yes, I'll just a couple of different statistics to what Todd said. And as he emphasized, DRs are an emerging markets play. And so with equity prices being down outside the U.S., investment sentiment being down globally, mergers and acquisitions being down, some of the statistics are that our DR trading value went down 30% year-to-year. Capital raisings were down 63%, and the fees generated from corporate actions, which are obviously difficult to predict, were down almost 30%. IPOs, coming to market, were also down year-on-year. So overall, the net cancellations ended up exceeding issuance by a wide margin. We only had $145 million cancellations and then compared to net issuance of a $1.5 billion the prior year. The good news out of all of that sadness is that the pipeline is building, but it takes longer for these deals to come to market. And there are 45 new programs out in worldwide and 115 new unsponsored programs. So there is some hope that as we look to the future, there'll be additional issuance activity.

Thomas P. Gibbons

So Alex, this is typical of what we've seen in this business. It tends to be hyper-cyclical. So we just went through a cycle, looks like we're coming toward the end of a cycle. And hopefully, if we get through the fiscal cliff and some investor sentiment changes, we could see this change pretty quickly.

Gerald L. Hassell

I think it points to some comments that Curtis was making earlier. Just investors around the world are sitting on the sidelines waiting for some greater clarity both in the U.S. and abroad. And when some of that clarity starts to improve, I think this is the kind of business that you'll see snap back.

Karen B. Peetz

The only other thing that I would add is that the U.S. CLO market, as Todd said, has been heating up, which are projecting about $40 billion of new issuance this year. And we've won 35% of the deals in the market, with 25 new deals and mandates on 12 more. So we are hoping that, that activity will continue to forecast for 2013 is quite positive for CLOs.

Alexander Blostein - Goldman Sachs Group Inc., Research Division

Got it. Thank you guys so much for this color, very helpful. Curtis, one for you. On asset management, things continue to perform quite well, and we're heading into, I guess, a performance fee quarter. So given the fact the markets have done well, it sounds like you guys have done well, can you give us a sense on either performance relative to benchmark or percentage of AUM that's kind of eligible for performance fees or something to help us understand how meaningful a performance fee quarter that could be for you guys?

Curtis Y. Arledge

Yes, absolutely. We are -- We obviously have a very big second quarter performance fees, and our fourth quarter, obviously, we'll have to wait and see how the end of the year plays out. But I'd tell you that right this minute we think that the fourth quarter is going to be pretty much in line with the fourth quarter of last year, plus or minus kind of based on how things stand today. Our performing -- our best performance has been good throughout the year and improving. And so that would be probably the best guidance I could give you.

Operator

Our next question comes from Luke Montgomery with Bernstein.

Luke Montgomery - Sanford C. Bernstein & Co., LLC., Research Division

I'd like to come back to the NIM and the securities portfolio just for a sec. It looks like it's been holding in a bit better than we expected anyway. So would you mind commenting briefly on your outlook for reinvestment risk in 2013, and specifically how you position the securities portfolio? You mentioned a duration of under 2 years. Would you have big slugs of that portfolio coming due starting in 2013? And what's your assessment of contraction prepayment risk with QE3, et cetera?

Thomas P. Gibbons

Yes. A lot in that question. So I think the -- where we had guided a couple of quarters ago was that we can continue to actually increase the size of the portfolio with the amount of growth in deposits and excess cash that we've done. So as we saw some of the higher yielding assets come off, we could reinvest at a faster pace, and that was going to offset the impact of that. The -- we got another headwind when the ECB cut rates to 0 on excess reserves. So that's why it backed off a little bit from where we were 2 or 3 quarters ago. But the gist of it is, is we can -- we will reinvest more than just what is maturing so the portfolio will continue to grow. We also -- just as a reminder, the investment portfolio is only about -- it's a little more than about 40% of our interest-earning assets. So we are seeing some growth in our loan volumes both in wealth management, both of it related to our global collateral services where we're increasing our secured lending, and we're seeing a little bit in our core businesses as well. So 2/3 of our NIM is generated by that. So it's not solely what's coming out of our portfolio. But we do think the maturities coming out of our portfolio will be a bit of a headwind on the NIM, all else being equal, and in the vicinity of 3 or 4 basis points.

Luke Montgomery - Sanford C. Bernstein & Co., LLC., Research Division

Great. Appreciate that color. Can you also just remind us of any expected capital impact under new regulations, related specifically to securities lending indemnifications that you extended to clients? And has there been any progress on those discussions with regulators? Is it a big deal for you? And is it already incorporated into your pro forma capital calculations?

Thomas P. Gibbons

Yes, at this point, I think, it's too early to say. That's still under development. There are conversations, but we're not really in a position to make a definitive statement, a statement one way or the other, Luke.

Operator

Our next question comes from Howard Chen with Credit Suisse.

Howard Chen - Crédit Suisse AG, Research Division

Just on the latest Basel III guidance of the 9.3%, I mean you're effectively 2 years ahead of where you wanted to be at the fourth quarter of 2014. So it would seems to me you can kind of ramp up capital return. Do you agree with that? And are there any offsets we should be thinking about in that equation?

Thomas P. Gibbons

Well, we are just heading into CCAR season right now, and we're taking a hard look as we'll go through our stress testing. And I think that given the strength of our -- the left-hand side of the balance sheet and we're ahead of where we had anticipated to be in terms of Basel III compliance, we will definitely take a hard look at this and see what the appropriate deployment is, whether it's going to be the same or more.

Gerald L. Hassell

Howard, just a quick comment. We think being ahead of schedule and given the capital that we're generating every single quarter gives us enormous flexibility as we go into, as Todd said, CCAR season. And we'll go through this process and see where we can come out.

Howard Chen - Crédit Suisse AG, Research Division

Great. And then just in terms of deployment, I mean, how are you thinking about maybe keeping or changing the mix of share repurchase versus dividends, keeping some dry powder for strategic acquisitions and obviously, organic reinvestment?

Gerald L. Hassell

Well, let's start with the last part of the question. We are not interested. It's not on the table in terms of acquisitions because we think the organic growth opportunities internally are so evident, both on the revenue side as well as investing and retiring platforms, investing in some of those operational initiatives, so the capital that we're generating in that regard is really dedicated to the great organic growth ideas that we've identified internally and to support our clients as they face this marketplace. The balance between dividends and share buybacks is always an interesting intellectual debate, as well as a financial debate. We think the answer is yes in terms of there should be a good balance between dividend growth and share buybacks. And Todd, you may want to add to it.

Thomas P. Gibbons

Well, we do talk to our investors and they help to inform of what that mix might be. And I think as we look out at the stress testing, there is sensitivity to percentage of the dividends relative to buybacks that we need to be aware of as well. But we will certainly look -- when we think of our capital deployment, we'll look at all of that here in the fourth quarter.

Howard Chen - Crédit Suisse AG, Research Division

Great. Looking forward to the update. And then shifting gears. I was hoping you could update us industry tri-party repo reform. What should we be anticipating on the horizon? And do you see this ultimately impacting any changes that would flow through either kind of your expense base or capital position due to kind of potential reforms?

Gerald L. Hassell

The quick answer is all of the investment and tri-party reform is in our run rate today. We are improving the technologies to address the issues that came out of the tri-party reform task force, and that's effectively to eliminate the intra-day credit that's being provided at the marketplace today. That requires a variety of technology improvements, as well as some change in behaviors on behalf of the investors and the dealers. That's progressing well, any of the expenses associated with that reform are in our run rate today. There are investments, as I said, that we are making on the technology side. I think we're making good progress, and there's still a lot more work to do. But we're making very good progress in meeting what the market is looking for.

Howard Chen - Crédit Suisse AG, Research Division

Okay, Gerald. And then just finally for me, on the expanded trading capabilities, we can certainly see some early traction again this quarter. But just could you, from a high level, talk about what you hope this to be, what's the opportunity set? I mean how should we think about hiring expectations over the next year to sort of great view on success over kind of the next coming years on this?

Gerald L. Hassell

Yes, the bulk of the investments are really on the technology platforms, again. We've described it in the past. Foreign exchange is going the route of the equity markets, where it's more electronic, it's higher speed, streaming prices to clients on a consistent basis, giving them greater optionality in terms of how they execute with us. We want to do the same thing with our fixed income securities area. We think we're a great counterparty in terms of derivatives, and we have a strong balance sheet and a great rating. And so you've seen some pickup in our activity there. We're not looking to do exotics. We're looking to do pretty plain vanilla and straight-up, customer-driven, client-driven activity. Our clients are the natural users of these things as investment managers. We see the transactions going through us on the servicing side. We want to just capture more of that flow and service our clients incredibly well. So I think the -- there'll be perhaps a little more volatility in the number, but I think the trend will be upwards. Art, do you want to add something to it?

Arthur Certosimo

Okay, Gerald. Thank you. Yes, we have invested -- clearly, the bulk of the investment is in the technology area. We have also invested in some personnel that have enhanced our rates business. But we're kind of a natural here, as Gerald has said, between high levels of service, strong counterparty, throw in there efficient settlement, where we're uniquely positioned to do something like that as well. It's just a nice service enhancement for us for not only our asset services clients, but our Corporate Trust clients, our DR clients, our treasury services clients. We have this wonderful broad client base that we can sell these services into. It just makes a lot sense for us.

Howard Chen - Crédit Suisse AG, Research Division

Great. And just maybe to follow up on this. I don't know how much you want to share, how much work you've done, but I mean, if we look at just the top kind of 13, 15 global dealers, maybe the fixed income revenue pool as they define it is maybe, let's say, it's like $100 billion. When you look at the opportunity set from all that you want to do, healthy counterparty, not take risk, I mean what do you see as sort of the definable market opportunity here?

Thomas P. Gibbons

Yes, I think, as far as the areas of growth, we'll see growth in the capital markets services space across rates for sure. Interest rate swaps is a great business for us, particularly on execution. And then, we're not going to leave out foreign exchange. I mean foreign exchange is still a very important business for us, and we simply need to be a more competitive through technology resources. In addition, I'd left out the purchasing network, which our purchasing client base is a marquee client base that we can also sell these services into. So we're really looking at growth across, I'd say, the rates business, particularly on fixed income and foreign exchange as well.

Gerald L. Hassell

Yes. Just in general, Howard, the size of the pie is very, very large, and we're only getting a small fraction of it. So we can just take relatively incremental pickup in some of that activity that we're already the natural party that's servicing those transactions. So we just want to just capture more of the flow internally.

Operator

Our final question then comes from Gerard Cassidy with RBC.

Gerard S. Cassidy - RBC Capital Markets, LLC, Research Division

Can you guys share with us -- you're way ahead of schedule on Basel III Tier 1 common ratio, where you are today versus where you thought you're going to be. Can you tell us the factors that contributed to that success of getting there sooner?

Thomas P. Gibbons

Sure, Gerard. There are a number of items. We're, first of all, retaining income. We are watching our intangible amortization burn-off, which goes into the capital account effectively. We have benefited under Basel III, the other comprehensive income or the changes in the available for sale portfolio runs through the capital accounts, so that has improved probably $1 billion pretax, a little -- probably about $500 million or $600 million after tax in the quarter. So it's the combination of income, the combination of OCI. And also, the original BIS guidelines were strictly driven by ratings, and as they've been adjusted, we also got a benefit on some of the sub-investment grade securities that weren't quite as capital attractive as they otherwise would have been. So it's the combination of those 3 items, and that was a very significant one I might add. So those 3 items have put us well in advance.

Gerard S. Cassidy - RBC Capital Markets, LLC, Research Division

Okay. And then the last question is coming back to the commentary you made about the pricing with your top 100 clients and how it's -- you have limited pricing power there. Are you guys seeing in that group -- and I know you're going to grow the revenues through more cross-selling for that group of clients, but are you seeing actually more pressure on pricing because of the environment that you're customers are in? Or is it now just a steady pressure that really hasn't intensified in the last 12 months.

Thomas P. Gibbons

Yes, Gerard. Before we -- and I'll look to Tim to answer that question. I mean, I'd like just to remind you, we're talking about the Asset Servicing business, which is about 25% to 30% of our total revenues. We're not talking about investment management. We're not talking about issuer services or treasury services or all of our other businesses. So we're really focused on a relatively important, but only 25% to 30% of our business. Tim, do you want to add anything to that?

Timothy F. Keaney

Yes. Gerard, I would say just generally, I've seen a little bit of a tapping down of repricing. Clearly, the fund management sector and insurance sector, which are driving a lot of our business, are under pricing pressure, but that's why we stay really focused on quality service. And I think that's why we've seen a bit of a damping down. But the coverage model that we put on these names, which I really didn't talk about yet, we have a whole business dedicated to those top 125 names with a high-touch service model, and it's already pulling through. I mean half of the new business we won on the quarter directly relates to 2 big clients that we've been focusing on. So we don't have the ability to raise prices. We've seen a little bit of a dampening down over the last year or so on negative reprices. But it is really much more long-term by cross-selling and delivering the new things that Art is building in collateral into those clients.

Gerald L. Hassell

Thanks, Gerard. And thank you very much, everyone, for dialing in and listening in. We appreciate it. If you have further questions, please give our IR team a call, Andy Clark, Izzy Dawood. And look forward to catching up with you soon. Thanks again, everybody.

Operator

Thank you. If there are any additional questions or comments, you may contact Mr. Andy Clark at (212) 635-1803. Thank you, ladies and gentlemen. This concludes today's conference call. Thank you for participating.

Copyright policy: All transcripts on this site are the copyright of Seeking Alpha. However, we view them as an important resource for bloggers and journalists, and are excited to contribute to the democratization of financial information on the Internet. (Until now investors have had to pay thousands of dollars in subscription fees for transcripts.) So our reproduction policy is as follows: You may quote up to 400 words of any transcript on the condition that you attribute the transcript to Seeking Alpha and either link to the original transcript or to www.SeekingAlpha.com. All other use is prohibited.

THE INFORMATION CONTAINED HERE IS A TEXTUAL REPRESENTATION OF THE APPLICABLE COMPANY'S CONFERENCE CALL, CONFERENCE PRESENTATION OR OTHER AUDIO PRESENTATION, AND WHILE EFFORTS ARE MADE TO PROVIDE AN ACCURATE TRANSCRIPTION, THERE MAY BE MATERIAL ERRORS, OMISSIONS, OR INACCURACIES IN THE REPORTING OF THE SUBSTANCE OF THE AUDIO PRESENTATIONS. IN NO WAY DOES SEEKING ALPHA ASSUME ANY RESPONSIBILITY FOR ANY INVESTMENT OR OTHER DECISIONS MADE BASED UPON THE INFORMATION PROVIDED ON THIS WEB SITE OR IN ANY TRANSCRIPT. USERS ARE ADVISED TO REVIEW THE APPLICABLE COMPANY'S AUDIO PRESENTATION ITSELF AND THE APPLICABLE COMPANY'S SEC FILINGS BEFORE MAKING ANY INVESTMENT OR OTHER DECISIONS.

If you have any additional questions about our online transcripts, please contact us at: transcripts@seekingalpha.com. Thank you!

Source: The Bank of New York Mellon Management Discusses Q3 2012 Results - Earnings Call Transcript
This Transcript
All Transcripts