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BNY Mellon (BK) Pulls Back From Russia, Expects Revenue Decline
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The Bank of New York Mellon Corporation (BK - Free Report) has stopped new banking business in Russia and suspended the purchase of Russian securities under its investment management business after a raft of sanctions were imposed on the country in response to its military assault on Ukraine.
BNY Mellon’s move is expected to result in a $100-million one-time reduction in first-quarter 2022 revenues. Also, the bank’s annual revenues are expected to be impacted by $80-$100 million, going forward.
Notably, the sanctions and export controls or any actions by Russia are expected to materially hinder U.S. companies’ business activities in and from Russia. Any further measures taken by the United States or its allies could also adversely impact the regional and global financial markets, and economic conditions.
With the move, BNY Mellon joins other Wall Street firms like Goldman Sachs (GS - Free Report) and JPMorgan (JPM - Free Report) in winding up their businesses in Russia.
A few days ago, Goldman Sachs stated, “Goldman Sachs is winding down its business in Russia in compliance with regulatory and licensing requirements. We are focused on supporting our clients across the globe in managing or closing out pre-existing obligations in the market and ensuring the wellbeing of our people.”
Echoing similar sentiments, JPMorgan said, “In compliance with directives by governments around the world, we have been actively unwinding Russian business and have not been pursuing any new business in Russia.”
While European banks are highly exposed to Russia, the U.S. banks have no less exposure. The moves by BK, GS and JPM follow a growing list of global companies, including accounting firms, technology groups, food suppliers and energy producers that increasingly distanced themselves from Russia in the wake of the ongoing conflict.
The exit moves by BK, GS and JPM are expected to put pressure on other Wall Street banks to follow suit in a bid to further financially alienate the country.
Over the past year, shares of BNY Mellon have rallied 15.7% compared with the industry’s growth of 5.6%.
Image: Bigstock
BNY Mellon (BK) Pulls Back From Russia, Expects Revenue Decline
The Bank of New York Mellon Corporation (BK - Free Report) has stopped new banking business in Russia and suspended the purchase of Russian securities under its investment management business after a raft of sanctions were imposed on the country in response to its military assault on Ukraine.
BNY Mellon’s move is expected to result in a $100-million one-time reduction in first-quarter 2022 revenues. Also, the bank’s annual revenues are expected to be impacted by $80-$100 million, going forward.
Notably, the sanctions and export controls or any actions by Russia are expected to materially hinder U.S. companies’ business activities in and from Russia. Any further measures taken by the United States or its allies could also adversely impact the regional and global financial markets, and economic conditions.
With the move, BNY Mellon joins other Wall Street firms like Goldman Sachs (GS - Free Report) and JPMorgan (JPM - Free Report) in winding up their businesses in Russia.
A few days ago, Goldman Sachs stated, “Goldman Sachs is winding down its business in Russia in compliance with regulatory and licensing requirements. We are focused on supporting our clients across the globe in managing or closing out pre-existing obligations in the market and ensuring the wellbeing of our people.”
Echoing similar sentiments, JPMorgan said, “In compliance with directives by governments around the world, we have been actively unwinding Russian business and have not been pursuing any new business in Russia.”
While European banks are highly exposed to Russia, the U.S. banks have no less exposure. The moves by BK, GS and JPM follow a growing list of global companies, including accounting firms, technology groups, food suppliers and energy producers that increasingly distanced themselves from Russia in the wake of the ongoing conflict.
The exit moves by BK, GS and JPM are expected to put pressure on other Wall Street banks to follow suit in a bid to further financially alienate the country.
Over the past year, shares of BNY Mellon have rallied 15.7% compared with the industry’s growth of 5.6%.
Image Source: Zacks Investment Research
Currently, BNY Mellon carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.