April 16 (Reuters) – BNY reported a rise in first-quarter profit on Thursday, as the world’s largest custodian bank was helped by strong fee income and higher values of client assets.
Global markets have swung sharply due to the Iran war and a broad selloff in AI-threatened software stocks, prompting investors and investment managers to rebalance portfolios, and boosting client activity.
BNY, which makes a sizeable chunk of its income safeguarding and servicing client assets, saw assets under custody and administration climb 12% year-on-year to $59.4 trillion as of March 31, while assets under management stood at $2.1 trillion.
Fee revenue, the bank’s largest source of income, jumped 11% in the quarter to $3.77 billion, supported by higher market levels and continued client engagement.
BNY’s net interest income – the spread between earnings from assets and costs on liabilities – surged 18% to $1.37 billion, boosted by higher yields on the reinvestment of matured assets.
CEO Robin Vince has been pushing to streamline operations and invest in technology to improve efficiency and drive growth. Return on tangible common equity – a metric that tracks profitability using only hard assets – rose to 29.3% in the quarter from 24.2% a year ago.
“When there are activity levels, when there is quantity issuance, and there’s a lot of fixed income issuance that’s been going on this year for all the reasons that you’re well aware of, our business is firing on many of these cylinders,” Vince told Reuters in an interview.
The company posted net income of $1.63 billion, or $2.24 per share, compared with $1.22 billion, or $1.58 per share, a year earlier. Revenue rose to a record $5.4 billion, up 13% from a year ago.
(Reporting by Utkarsh Shetti in Bengaluru and Saeed Azhar in New York; Editing by Leroy Leo)
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