The Bank of New York Mellon (BNY) UBS Financial Services Conference summary

Margin improvement and business execution

• Pre-tax margin in Securities Services rose from 20% to 29% by 2024, driven by execution on both revenue growth and expense discipline, with continued investments in technology and efficiency initiatives.

• Fee revenue grew 6% in 2024, the strongest in a decade, attributed to de-siloing, integrated client solutions, and enhanced account planning and data use.

• Major client wins, such as WisdomTree, showcased the ability to deliver holistic, firm-wide solutions and rapid onboarding.

• Investments in automation, digitization, and new technologies have enabled both cost control and scale.

• A healthy pipeline of AUCA and revenues is expected to support further margin expansion, with a medium-term target of 30%+ pre-tax margin.

Growth in ETFs, alternatives, and managed accounts

• ETF assets under custody/administration (AUCA) grew 60% year-on-year to nearly $3 trillion, outpacing market growth, with a 20% increase in funds serviced.

• Enhanced ETF servicing includes electronic tools for creation/redemption, portfolio rebalancing, and digital asset custody capabilities.

• Alternatives (alts) are experiencing double-digit growth, driven by secular trends, outsourcing, and new liquid alt products via the Alts Bridge platform.

• Acquisition of Archer expanded capabilities in retail managed accounts, enabling end-to-end servicing, manufacturing, and distribution.

• Fee rates for alts servicing are higher than for traditional funds, reflecting complexity and bundled solutions.

Technology, data, and platform operating model

• Significant investments in technology include automation, AI for NAV oversight, and integrated data management for both GPs and LPs.

• The Platform Operating Model (POM) streamlines operations, reduces redundancy, and empowers interdisciplinary teams, improving speed to market and employee satisfaction.

• POM adoption is expanding, with 25% of the company transitioned and plans to reach 50% soon; early results show faster client onboarding and higher satisfaction.

• Centralized deposit management has improved client experience, pricing, and balance sheet predictability, supporting NIR outperformance.

• Data integration with third-party providers enhances transparency, performance attribution, and risk oversight for asset owners.