BNY Mellon AUM drops 6% over quarter, 2.4% for year

Bank of New York Mellon's investment management and wealth management businesses reported $1.8 trillion in assets under management as of March 31, marking a 6% decline from the previous quarter and a 2.4% decline in assets from the first quarter of 2019, according to parent BNY Mellon's quarterly earnings release issued Thursday.

AUM was down over the year primarily because of the unfavorable impact of a stronger U.S. dollar, principally vs. the British pound, the earnings release said.

Within its investment management business, the firm had $5 billion in net outflows from long-term strategies, compared to $6 billion in net outflows from long-term strategies in the fourth quarter and $2 billion in long-term net outflows during 2019's first quarter .

Including flows from cash, or short-term strategies, net inflows were $38 billion during the first quarter. In the fourth quarter, total net outflows were $13 billion, compared to no net flows in the first quarter of 2019.

Inflows of $43 billion into cash helped to drive much of the net inflows in the first quarter, an earnings supplement showed.

Investment management revenue decreased in the first quarter to $862 million, down 2.4% from the fourth quarter and up 2.5% from the first quarter of 2019.

Speaking on the company's response to the coronavirus pandemic, CEO Thomas P. "Todd" Gibbons said that fewer than 5% of global employees remain in the office in order to perform duties that cannot be done remotely.

Notably, Mr. Gibbons said the firm "will not do any additional layoffs during 2020."

"It's definitely the right thing to do at a time when the pandemic is creating so many personal uncertainties for our people," Mr. Gibbons said.

"Looking ahead to the remainder of 2020, it is difficult to forecast the impact of the coronavirus on our results with certainty, because so much depends on how the health crisis evolves, its impact on the economy, and actions taken by central banks and governments to support the economy. We have a lower-risk fee-based business model that positions us relatively well in an environment like this."

During a Q&A with analysts, Mr. Gibbons noted that the firm's investment in technology could be delayed, as the company keeps a "very close eye on our expenses."

"I'm certain that a couple of things might end up being delayed a bit, but I'm not going to pull that out of our plans at this point in time, by any means," he said about technology spending.

Technology expenses are included in the firm's reporting of staff, professional, legal, "other purchased services," and software and equipment expenses, which totaled $2.1 billion in costs in the first quarter, according to the earnings supplement.