Revenue dropped 5% from last year to $3.9 billion. Net income registered $932 million, or 97 cents per share, down from $962 million, or $1.05, a year ago. BNY Mellon has suffered from strong competition in the custody industry, which has pushed down prices for custody services.
The FactSet analyst consensus called for earnings per share of 87 cents.
The company’s stock recently traded at $46.72, down 2.7%, but has jumped 29% over the past six months amid a rally for bank stocks that has resulted from rising Treasury yields.
BNY Mellon officials tried to put a positive spin on the earnings report.
“We delivered a strong quarter and continue to see momentum across our businesses, despite the ongoing impact of low interest rates,” said Chief Executive Todd Gibbons.
“In the first quarter of 2021, … we delivered a 1% increase in fee revenue, or 6% excluding the impact of money-market fee waivers. This included strong organic growth driven by new business and higher activity levels.”
Further, “Our business model has proven to be resilient and operating margin was essentially flat at 29%, compared to the first quarter of 2020 when we saw exceptional pandemic-related volumes and volatility,” Gibbons said.
Last month, the bank was double-upgraded at Bank of America Securities, to buy from underperform, with a price-target increase to $50 from $43.
Also last month came news that BNY Mellon has invested in Fireblocks, a startup that specializes in cryptocurrency safekeeping.