Apr 18 (Reuters) – Bank of New York Mellon Corp (BK.N) beat first-quarter earnings estimates on Tuesday, benefiting from Federal Reserve rate hikes that boosted the lender’s interest income.
Banks have been big beneficiaries of the Fed’s aggressive monetary policy aimed at curbing decades of inflation, which has also led to heightened market volatility and a credit crunch.
The US banking industry was thrown into turmoil last month as bank failures eroded investor confidence and hit both equity and bond markets.
The collapse of Silicon Valley Bank, the largest bank to fail since the 2008 financial crisis, fueled fears of a liquidity crunch and put financial institutions to the test.
BNY deposits, a key metric investors have focused on this quarter after the banking sector woes, fell 5% from the end of last year to $167 billion. They’re down 13% year over year.
The banking crisis, combined with already existing fears of a recession, prompted BNY to set aside $27 million in loss provisions, up from $2 million a year earlier.
On an adjusted basis, the bank reported earnings of $1.13 per share, beating analysts’ median estimate of $1.12 per share, according to data from Refinitiv IBES.
The New York-based lender’s net interest income rose 62% to $1.1 billion in the quarter, compared to $698 million a year earlier.
Assets under custody and under management rose 2% to $46.4 trillion, reflecting inflows of clients and net new business, the bank said.
Quarterly sales rose 11% to $4.4 billion.
Reporting by Jaiveer Singh Shekhawat in Bengaluru Editing by Vinay Dwivedi
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