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BNY Q3 Earnings Beat Estimates on Fee Income & NII Growth
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Key Takeaways
BNY's Q3 adjusted EPS jumped 24.1% y/y, beating estimates, while total revenues rose 11.7% to $5.68B.
Fee revenues climbed 12.1% y/y, while NII surged 15.1% to $1.42B, driven by higher yields and growth.
BNY's AUC/A grew 9.7% to $63.4T, while AUM rose 2.1%, despite net outflows and currency headwinds.
The Bank of New York Mellon Corporation’s (BNY - Free Report) third-quarter 2026 adjusted earnings of $2.37 per share surpassed the Zacks Consensus Estimate of $2.26. The bottom line increased 24.1% from the year-ago quarter.
Results have primarily benefited from a rise in fee revenues and net interest income (NII). Growth in assets under custody and/or administration (AUC/A) and assets under management (AUM) balances supported the results. However, higher expenses hurt the results to some extent.
Results excluded certain non-recurring items. Considering those, net income applicable to common shareholders (GAAP basis) was $1.61 billion, up 20.1% from the year-ago quarter.
BNY’s Fee Revenues & NII Increase
Total revenues increased 11.7% year over year to $5.68 billion. The top line surpassed the Zacks Consensus Estimate of $5.56 billion.
Total fee revenues were $4.08 billion, up 12.1% year over year. Investment services fees increased 15% to $2.97 billion, supported by net new business, higher market values and increased client activity.
Investment management and performance fees rose 2.7% to $803 million. Foreign exchange revenues increased 19.3% to $198 million. Investment and other revenues totaled $175 million, down from $208 million in the prior-year quarter, reflecting the impacts of fixed income and equity trading activity, seed capital results, and the absence of a year-ago disposal gain, partly offset by other investment gains.
NII jumped 15.1% year over year to $1.42 billion. The increase reflected the reinvestment of investment securities at higher yields and balance-sheet growth, partly offset by deposit margin compression.
The net interest margin expanded 12 basis points year over year to 1.43%.
Average loans grew 19.4% from the prior-year quarter to $86.79 billion. Average deposits increased 3.9% to $311.08 billion.
Bank of New York Mellon’s Expenses Rise
Total non-interest expenses were $3.49 billion, up 7.8% year over year. Higher revenue-related costs and investments drove the rise, partly offset by efficiency savings.
Despite higher costs, revenue growth outpaced expense growth. This generated 389 basis points of year-over-year operating leverage.
The pre-tax operating margin expanded to 38.5% from 36.4% a year earlier.
BNY’s Asset Balances Expand
AUC/A were $63.4 trillion as of Sept. 30, 2026, up 9.7% year over year. The increase reflected higher market values, net client inflows and net new business, partly offset by the unfavorable impact of a stronger U.S. dollar.
AUM increased 2.1% to $2.19 trillion. Higher market values supported the balance, though cumulative net outflows and unfavorable currency movements were headwinds.
BNY’s Credit Quality: Mixed Bag
The allowance for loan losses, as a percentage of total loans, was 0.25%, down from 0.36% in the prior-year quarter. As of Sept. 30, 2026, the allowance for loan losses was $220 million, down from $272 million in the year-ago quarter.
BNY recorded a provision for credit losses of $1 million against a provision benefit of $7 million in the year-ago quarter.
BNY’s Capital Ratios Fall
As of Sept. 30, 2026, the common equity Tier 1 ratio was 10.9%, down from 11.7% as of Sept. 30, 2025. The Tier 1 leverage ratio was 5.7%, down from 6.1% as of Sept. 30, 2025.
BNY’s Share Repurchase Update
In the reported quarter, BNY repurchased shares worth $937 million.
Our Take on BNY
BNY’s revenue growth is expected to continue to be supported by higher fee revenues, net new business, increased client activity and higher market values. However, rising expenses, deposit margin compression and cumulative net outflows in AUM remain headwinds.
Bank of America’s (BAC - Free Report) third-quarter 2026 adjusted earnings of $1.08 per share missed the Zacks Consensus Estimate of $1.11. In the prior-year quarter, the company reported earnings of $1.04.
Bank of America witnessed dismal trading performance this time around due to weaker fixed-income trading. Similarly, amid weakness in advisory and debt underwriting activities, BAC’s investment banking (IB) business performance was not good.
While BAC’s capital markets business performance was not impressive this time, year-over-year growth in NII drove total revenues. Provisions declined in the quarter on a year-over-year basis, which was a positive, but non-interest expenses increased, creating another major headwind.
JPMorgan’s (JPM - Free Report) third-quarter 2026 adjusted earnings of $5.75 per share missed the Zacks Consensus Estimate of $5.94. After considering the net investment securities losses of 18 cents, earnings were $5.57 per share, up 9.9% from a year ago.
JPM’s reported net revenues of $50.17 billion rose 8% year over year. Strong equity trading performance, IB activity and loan growth supported revenues, while the fixed income trading business was subdued. While JPMorgan recorded a year-over-year rise in expenses in the quarter, it witnessed a decline in provisions, which aided the results to some extent.
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BNY Q3 Earnings Beat Estimates on Fee Income & NII Growth
Key Takeaways
The Bank of New York Mellon Corporation’s (BNY - Free Report) third-quarter 2026 adjusted earnings of $2.37 per share surpassed the Zacks Consensus Estimate of $2.26. The bottom line increased 24.1% from the year-ago quarter.
Results have primarily benefited from a rise in fee revenues and net interest income (NII). Growth in assets under custody and/or administration (AUC/A) and assets under management (AUM) balances supported the results. However, higher expenses hurt the results to some extent.
Results excluded certain non-recurring items. Considering those, net income applicable to common shareholders (GAAP basis) was $1.61 billion, up 20.1% from the year-ago quarter.
BNY’s Fee Revenues & NII Increase
Total revenues increased 11.7% year over year to $5.68 billion. The top line surpassed the Zacks Consensus Estimate of $5.56 billion.
Total fee revenues were $4.08 billion, up 12.1% year over year. Investment services fees increased 15% to $2.97 billion, supported by net new business, higher market values and increased client activity.
Investment management and performance fees rose 2.7% to $803 million. Foreign exchange revenues increased 19.3% to $198 million. Investment and other revenues totaled $175 million, down from $208 million in the prior-year quarter, reflecting the impacts of fixed income and equity trading activity, seed capital results, and the absence of a year-ago disposal gain, partly offset by other investment gains.
NII jumped 15.1% year over year to $1.42 billion. The increase reflected the reinvestment of investment securities at higher yields and balance-sheet growth, partly offset by deposit margin compression.
The net interest margin expanded 12 basis points year over year to 1.43%.
Average loans grew 19.4% from the prior-year quarter to $86.79 billion. Average deposits increased 3.9% to $311.08 billion.
Bank of New York Mellon’s Expenses Rise
Total non-interest expenses were $3.49 billion, up 7.8% year over year. Higher revenue-related costs and investments drove the rise, partly offset by efficiency savings.
Despite higher costs, revenue growth outpaced expense growth. This generated 389 basis points of year-over-year operating leverage.
The pre-tax operating margin expanded to 38.5% from 36.4% a year earlier.
BNY’s Asset Balances Expand
AUC/A were $63.4 trillion as of Sept. 30, 2026, up 9.7% year over year. The increase reflected higher market values, net client inflows and net new business, partly offset by the unfavorable impact of a stronger U.S. dollar.
AUM increased 2.1% to $2.19 trillion. Higher market values supported the balance, though cumulative net outflows and unfavorable currency movements were headwinds.
BNY’s Credit Quality: Mixed Bag
The allowance for loan losses, as a percentage of total loans, was 0.25%, down from 0.36% in the prior-year quarter. As of Sept. 30, 2026, the allowance for loan losses was $220 million, down from $272 million in the year-ago quarter.
BNY recorded a provision for credit losses of $1 million against a provision benefit of $7 million in the year-ago quarter.
BNY’s Capital Ratios Fall
As of Sept. 30, 2026, the common equity Tier 1 ratio was 10.9%, down from 11.7% as of Sept. 30, 2025. The Tier 1 leverage ratio was 5.7%, down from 6.1% as of Sept. 30, 2025.
BNY’s Share Repurchase Update
In the reported quarter, BNY repurchased shares worth $937 million.
Our Take on BNY
BNY’s revenue growth is expected to continue to be supported by higher fee revenues, net new business, increased client activity and higher market values. However, rising expenses, deposit margin compression and cumulative net outflows in AUM remain headwinds.
BNY Price, Consensus and EPS Surprise
BNY price-consensus-eps-surprise-chart | BNY Quote
Currently, BNY carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Major Banks
Bank of America’s (BAC - Free Report) third-quarter 2026 adjusted earnings of $1.08 per share missed the Zacks Consensus Estimate of $1.11. In the prior-year quarter, the company reported earnings of $1.04.
Bank of America witnessed dismal trading performance this time around due to weaker fixed-income trading. Similarly, amid weakness in advisory and debt underwriting activities, BAC’s investment banking (IB) business performance was not good.
While BAC’s capital markets business performance was not impressive this time, year-over-year growth in NII drove total revenues. Provisions declined in the quarter on a year-over-year basis, which was a positive, but non-interest expenses increased, creating another major headwind.
JPMorgan’s (JPM - Free Report) third-quarter 2026 adjusted earnings of $5.75 per share missed the Zacks Consensus Estimate of $5.94. After considering the net investment securities losses of 18 cents, earnings were $5.57 per share, up 9.9% from a year ago.
JPM’s reported net revenues of $50.17 billion rose 8% year over year. Strong equity trading performance, IB activity and loan growth supported revenues, while the fixed income trading business was subdued. While JPMorgan recorded a year-over-year rise in expenses in the quarter, it witnessed a decline in provisions, which aided the results to some extent.