Bank of New York Mellon
Encyclopedia
The Bank of New York Mellon Corporation is a global financial services
company formed on July 1, 2007 as result of the merger of The Bank of New York
and Mellon Financial Corporation. The company employs more than 48,000 staff worldwide and has over US$
1.2 trillion in assets under management and $25.5 trillion in assets under custody and administration thereby being the largest deposit bank in the world. It operates in six primary financial services sectors including asset management
, asset
servicing, wealth management
, broker-dealer
and advisory services
, issuance services, and treasury services
. It is the oldest banking corporation in the United States, tracing its origins to the establishment of the Bank of New York in 1784 by Alexander Hamilton
.
The Bank of New York was founded by Alexander Hamilton on June 9, 1784, in the old Walton Mansion in New York City. The President of the new bank was former Major General
Alexander McDougall
, with William Winston Seaton
as the Chief Cashier
. In 1792 when the New York Stock Exchange
was first opened, The Bank of New York was the first company to be traded on the Exchange. When the bank had been founded in 1784, it had been established by a series of documents drawn up by Alexander Hamilton. It wasn't until May 2, 1791 that the Bank was able to procure a charter
.
The charter was renewed several times up until the era of free banking, when in 1852, it was officially recognized under Banking Law as a bank having a capital of $2,000,000. Following the instigation of the National Banking Act
, the Bank of New York in 1865 was once again chartered, this time as a National Bank via the act.
Up through the early 1900s, the Bank of New York continued to expand and prosper. In July 1922, the Bank of New York and the New York Life Insurance and Trust Company merged. Because of the wise policies adopted by the management of the Bank, the firm managed to come through the Great Depression
strengthened financially. In 1948 the Bank once again merged, this time with the Fifth Avenue Bank, to be followed by a merger in 1966 with the Empire Trust Company. That same year, 1966, the Bank of New York opened offices in London
. The addition of the London office, was instrumental in the establishment of the Bank on the international level. The bank's holding company
was created in 1969. It was instrumental in the growth and expansion of the Bank of New York, outside of New York City.
, Pennsylvania
. The bank was established in 1869 by the retired Judge Thomas Mellon
and his sons Andrew W. Mellon
and Richard B. Mellon
. Alcoa
, Westinghouse
, and Bethlehem Steel
amongst other industrial firms, were a few of the companies T. Mellon & Son's financed. The former oil company Gulf Oil
was considered to be one T. Mellon & Son's most successful financial investments. The former Judge Thomas Mellon decided to retire from the firm as President in 1886 to be succeeded by his son, Andrew.
In 1902, T. Mellon & Son's name was changed to that of the Mellon National Bank. The firm merged with the Union Trust Company in 1946, a business founded by Andrew Mellon. The name of the newly formed organization was the Mellon National Bank and Trust Company, Pittsburgh's first $1 billion bank.
In 1920 Andrew left his leadership post of the bank to become the longest serving U.S. Treasury Secretary in history (serving under three separate administrations). In 1929, Richard founded Mellbank Corporation. In 1946, Mellon National, Mellbank, and the Union Trust Company merged to form Mellon National Bank and Trust Company. A reorganization in 1972 brought about a name change to Mellon Bank, N.A. and the formation of a holding company, Mellon National Corporation.
In 1983, Mellon bought Girard Bank of Philadelphia and Central Counties Bank of State College, Pennsylvania. The next year, Mellon National Corporation became Mellon Bank Corporation, and purchased Northwest Pennsylvania Corporation of Oil City, Pennsylvania. In 1986, Mellon bought Commonwealth National Financial of Harrisburg, Pennsylvania. In 1991, Mellon bought United Penn Bank of Wilkes-Barre, Pennsylvania. The next year, Mellon bought 54 branch offices of Philadelphia-based Philadelphia Savings Fund Society, whose parent company had become insolvent. Philadelphia Savings Fund Socity, was the first savings bank in the United States, founded in 1819.
In 1993, Mellon bought The Boston Company from American Express and AFCO Credit Corporation from The Continental Corporation. The next year, Mellon merged with the Dreyfus Corporation, bringing its mutual funds under its umbrella. 1998 saw Mellon's purchase of United Bankshares, Inc., of Miami, 1st Business Bank of Los Angeles, and Founders Asset Management.
In 1999, Martin G. McGuinn became chairman and chief executive officer of Mellon Bank Corporation. Mellon Bank Corporation then became Mellon Financial Corporation. In 2004, Mellon announced it would purchase Safeco Trust Company from Seattle-based Safeco Corporation. The same year, it purchased outstanding shares in London-based Pareto Partners and offered them floor space in Mellon Financial (opened earlier in the year).
On December 4, 2006, Bank of New York and Mellon Financial Corporation announced that they would merge, creating the world's largest securities servicing and asset management firm. Under terms of the deal, Bank of New York's shareholders received 0.9434 shares in the new company for each share of Bank of New York that they owned, and Mellon shareholders (Taks) received 1 share in the new company for each Mellon share they owned. Bank of New York and Mellon entered into mutual stock option agreements for 19.9% of the issuer's outstanding common stock
.
The new company, called Bank of New York Mellon Corporation, is the world's leading asset servicer by a considerable margin, with over $20 trillion in assets under custody (vaulting it over State Street Corporation, which has $15.1 trillion of assets under custody), and corporate trustee with $8 trillion in assets under trusteeship. It ranks among the top 10 global asset managers with more than $1 trillion in assets under management.
Coincidentally, the merger also brought together two financial institutions that had recently sold off their retail banking
divisions. Bank of New York sold off their retail banking division to JPMorgan Chase in 2006, while Mellon sold their retail banking division to RBS
-owned Citizens Financial Group
in 2001.
It ranks as a top-10 U.S. wealth manager with more than $160 billion in client assets, and is a leading U.S. cash management
and global payments provider. The company has annual revenues of about $13 billion, and pro-forma market capitalization of about $50 billion. The company has 40 thousand employees around the world. The Bank of New York Mellon Corporation operates in 37 countries, serving more than 100 markets. The company provides financial services for institutions, corporations, and high-net-worth individuals, through a worldwide team. It also services more than $11 trillion in outstanding debt.
Tom Renyi
, former chairman and chief executive of Bank of New York, served as executive chairman of Bank of New York Mellon for 18 months following the close of the deal, with overall responsibility for the integration of the two companies, having retired effective July 1, 2008.
Robert P. Kelly
, former president, chairman, and chief executive of Mellon, served as chief executive of the new company and succeeded Renyi as chairman of the board. Gerald L. Hassell, former president of Bank of New York, holds the same position in the new company.On August 31st 2011 Kelly resigned "by mutual agreement with the board of directors,due to differences in approach to managing the company" (quoting the press release issued) and his titles were added to Hassell's.
The board of directors had 10 members designated by Bank of New York, and 8 members designated by Mellon. The new company's headquarters is based in New York City, though they maintain significant operations in Pittsburgh.Kelly's resignation left 13 directors (8 from Bank of New York and 5 from Mellon).
The merger was finalized on July 2, 2007. The principal office of business was set at the One Wall Street office.The BNY Mellon brand name is used for most lines of business.
, losing an undisclosed number of tapes containing customer information. Victims of the data spill were offered two years of credit monitoring.
In late November 2008, the company announced that due to the global financial crisis, the company would be laying off 1,800 employees, translating into 4% of its global work force, with CEO Robert Kelly citing the need to "reduce expenses" past any post-merger plans.
from the Treasury. The bank is the master custodian for the TARP funds, hired by the Treasury to handle accounting and record-keeping for the program.
The bank also celebrated its 225th anniversary on June 9, 2009. The company honored this milestone with a commemorative video addressing its history and prominent position in the global economy.
Financial services
Financial services refer to services provided by the finance industry. The finance industry encompasses a broad range of organizations that deal with the management of money. Among these organizations are credit unions, banks, credit card companies, insurance companies, consumer finance companies,...
company formed on July 1, 2007 as result of the merger of The Bank of New York
Bank of New York
The Bank of New York was a global financial services company established in 1784 by the American Founding Father Alexander Hamilton. It existed until its merger with the Mellon Financial Corporation on July 2, 2007...
and Mellon Financial Corporation. The company employs more than 48,000 staff worldwide and has over US$
United States dollar
The United States dollar , also referred to as the American dollar, is the official currency of the United States of America. It is divided into 100 smaller units called cents or pennies....
1.2 trillion in assets under management and $25.5 trillion in assets under custody and administration thereby being the largest deposit bank in the world. It operates in six primary financial services sectors including asset management
Investment management
Investment management is the professional management of various securities and assets in order to meet specified investment goals for the benefit of the investors...
, asset
Asset
In financial accounting, assets are economic resources. Anything tangible or intangible that is capable of being owned or controlled to produce value and that is held to have positive economic value is considered an asset...
servicing, wealth management
Wealth management
Wealth management is an investment advisory discipline that incorporates financial planning, investment portfolio management and a number of aggregated financial services...
, broker-dealer
Broker-dealer
A broker-dealer is a term used in United States financial services regulations. It is a natural person, a company or other organization that trades securities for its own account or on behalf of its customers....
and advisory services
Investment Advisor
The term Investment Advisor is an individual or firm who, for compensation, engages in the business of advising others, either directly or through publications or writings, as to the value of securities or as to the advisability of investing in, purchasing, or selling securities...
, issuance services, and treasury services
Treasury management
Treasury management includes management of an enterprise's holdings, with the ultimate goal of maximizing the firm's liquidity and mitigating its operational, financial and reputational risk. Treasury Management includes a firm's collections, disbursements, concentration, investment and funding...
. It is the oldest banking corporation in the United States, tracing its origins to the establishment of the Bank of New York in 1784 by Alexander Hamilton
Alexander Hamilton
Alexander Hamilton was a Founding Father, soldier, economist, political philosopher, one of America's first constitutional lawyers and the first United States Secretary of the Treasury...
.
Bank of New York
Major General
Major general or major-general is a military rank used in many countries. It is derived from the older rank of sergeant major general. A major general is a high-ranking officer, normally subordinate to the rank of lieutenant general and senior to the ranks of brigadier and brigadier general...
Alexander McDougall
Alexander McDougall
Alexander McDougall was an American seaman, merchant, a Sons of Liberty leader from New York City before and during the American Revolution, and a military leader during the Revolutionary War. He served as a major general in the Continental Army, and as a delegate to the Continental Congress...
, with William Winston Seaton
William Winston Seaton
William Winston Seaton was an American journalist, born in King William County, Va.From 1812 until 1860 he was, with his brother-in-law Joseph Gales, proprietor of the National Intelligencer at Washington, D.C. From 1812 until 1820 the two were the only reporters of congressional proceedings...
as the Chief Cashier
Cashier
Cashier is an occupation focused on the handling of cash money.- Retail :In a shop, a cashier is a person who scans the goods through a machine called a cash register that the consumer wishes to purchase at the retail store. After all of the goods have been scanned, the cashier then collects...
. In 1792 when the New York Stock Exchange
New York Stock Exchange
The New York Stock Exchange is a stock exchange located at 11 Wall Street in Lower Manhattan, New York City, USA. It is by far the world's largest stock exchange by market capitalization of its listed companies at 13.39 trillion as of Dec 2010...
was first opened, The Bank of New York was the first company to be traded on the Exchange. When the bank had been founded in 1784, it had been established by a series of documents drawn up by Alexander Hamilton. It wasn't until May 2, 1791 that the Bank was able to procure a charter
Charter
A charter is the grant of authority or rights, stating that the granter formally recognizes the prerogative of the recipient to exercise the rights specified...
.
The charter was renewed several times up until the era of free banking, when in 1852, it was officially recognized under Banking Law as a bank having a capital of $2,000,000. Following the instigation of the National Banking Act
National Banking Act
The National Banking Acts of 1863 and 1864 were two United States federal laws that established a system of national charters for banks, and created the United States National Banking System. They encouraged development of a national currency backed by bank holdings of U.S...
, the Bank of New York in 1865 was once again chartered, this time as a National Bank via the act.
Up through the early 1900s, the Bank of New York continued to expand and prosper. In July 1922, the Bank of New York and the New York Life Insurance and Trust Company merged. Because of the wise policies adopted by the management of the Bank, the firm managed to come through the Great Depression
Great Depression
The Great Depression was a severe worldwide economic depression in the decade preceding World War II. The timing of the Great Depression varied across nations, but in most countries it started in about 1929 and lasted until the late 1930s or early 1940s...
strengthened financially. In 1948 the Bank once again merged, this time with the Fifth Avenue Bank, to be followed by a merger in 1966 with the Empire Trust Company. That same year, 1966, the Bank of New York opened offices in London
London
London is the capital city of :England and the :United Kingdom, the largest metropolitan area in the United Kingdom, and the largest urban zone in the European Union by most measures. Located on the River Thames, London has been a major settlement for two millennia, its history going back to its...
. The addition of the London office, was instrumental in the establishment of the Bank on the international level. The bank's holding company
Holding company
A holding company is a company or firm that owns other companies' outstanding stock. It usually refers to a company which does not produce goods or services itself; rather, its purpose is to own shares of other companies. Holding companies allow the reduction of risk for the owners and can allow...
was created in 1969. It was instrumental in the growth and expansion of the Bank of New York, outside of New York City.
Mellon Financial
"T. Mellon & Son's Bank", as Mellon Financial was originally called, was founded in PittsburghPittsburgh, Pennsylvania
Pittsburgh is the second-largest city in the US Commonwealth of Pennsylvania and the county seat of Allegheny County. Regionally, it anchors the largest urban area of Appalachia and the Ohio River Valley, and nationally, it is the 22nd-largest urban area in the United States...
, Pennsylvania
Pennsylvania
The Commonwealth of Pennsylvania is a U.S. state that is located in the Northeastern and Mid-Atlantic regions of the United States. The state borders Delaware and Maryland to the south, West Virginia to the southwest, Ohio to the west, New York and Ontario, Canada, to the north, and New Jersey to...
. The bank was established in 1869 by the retired Judge Thomas Mellon
Thomas Mellon
Thomas Alexander Mellon was a Scotch-Irish American, entrepreneur, lawyer, and judge, best known as the founder of Mellon Bank and patriarch of the Mellon family of Pittsburgh, Pennsylvania.-Early life:...
and his sons Andrew W. Mellon
Andrew W. Mellon
Andrew William Mellon was an American banker, industrialist, philanthropist, art collector and Secretary of the Treasury from March 4, 1921 until February 12, 1932.-Early life:...
and Richard B. Mellon
Richard B. Mellon
Richard Beatty Mellon , sometimes R.B., was a banker, industrialist, and philanthropist from Pittsburgh, Pennsylvania....
. Alcoa
Alcoa
Alcoa Inc. is the world's third largest producer of aluminum, behind Rio Tinto Alcan and Rusal. From its operational headquarters in Pittsburgh, Pennsylvania, Alcoa conducts operations in 31 countries...
, Westinghouse
Westinghouse Electric (1886)
Westinghouse Electric was an American manufacturing company. It was founded in 1886 as Westinghouse Electric Company and later renamed Westinghouse Electric Corporation by George Westinghouse. The company purchased CBS in 1995 and became CBS Corporation in 1997...
, and Bethlehem Steel
Bethlehem Steel
The Bethlehem Steel Corporation , based in Bethlehem, Pennsylvania, was once the second-largest steel producer in the United States, after Pittsburgh, Pennsylvania-based U.S. Steel. After a decline in the U.S...
amongst other industrial firms, were a few of the companies T. Mellon & Son's financed. The former oil company Gulf Oil
Gulf Oil
Gulf Oil was a major global oil company from the 1900s to the 1980s. The eighth-largest American manufacturing company in 1941 and the ninth-largest in 1979, Gulf Oil was one of the so-called Seven Sisters oil companies...
was considered to be one T. Mellon & Son's most successful financial investments. The former Judge Thomas Mellon decided to retire from the firm as President in 1886 to be succeeded by his son, Andrew.
In 1902, T. Mellon & Son's name was changed to that of the Mellon National Bank. The firm merged with the Union Trust Company in 1946, a business founded by Andrew Mellon. The name of the newly formed organization was the Mellon National Bank and Trust Company, Pittsburgh's first $1 billion bank.
In 1920 Andrew left his leadership post of the bank to become the longest serving U.S. Treasury Secretary in history (serving under three separate administrations). In 1929, Richard founded Mellbank Corporation. In 1946, Mellon National, Mellbank, and the Union Trust Company merged to form Mellon National Bank and Trust Company. A reorganization in 1972 brought about a name change to Mellon Bank, N.A. and the formation of a holding company, Mellon National Corporation.
In 1983, Mellon bought Girard Bank of Philadelphia and Central Counties Bank of State College, Pennsylvania. The next year, Mellon National Corporation became Mellon Bank Corporation, and purchased Northwest Pennsylvania Corporation of Oil City, Pennsylvania. In 1986, Mellon bought Commonwealth National Financial of Harrisburg, Pennsylvania. In 1991, Mellon bought United Penn Bank of Wilkes-Barre, Pennsylvania. The next year, Mellon bought 54 branch offices of Philadelphia-based Philadelphia Savings Fund Society, whose parent company had become insolvent. Philadelphia Savings Fund Socity, was the first savings bank in the United States, founded in 1819.
In 1993, Mellon bought The Boston Company from American Express and AFCO Credit Corporation from The Continental Corporation. The next year, Mellon merged with the Dreyfus Corporation, bringing its mutual funds under its umbrella. 1998 saw Mellon's purchase of United Bankshares, Inc., of Miami, 1st Business Bank of Los Angeles, and Founders Asset Management.
In 1999, Martin G. McGuinn became chairman and chief executive officer of Mellon Bank Corporation. Mellon Bank Corporation then became Mellon Financial Corporation. In 2004, Mellon announced it would purchase Safeco Trust Company from Seattle-based Safeco Corporation. The same year, it purchased outstanding shares in London-based Pareto Partners and offered them floor space in Mellon Financial (opened earlier in the year).
Merger
Common stock
Common stock is a form of corporate equity ownership, a type of security. It is called "common" to distinguish it from preferred stock. In the event of bankruptcy, common stock investors receive their funds after preferred stock holders, bondholders, creditors, etc...
.
The new company, called Bank of New York Mellon Corporation, is the world's leading asset servicer by a considerable margin, with over $20 trillion in assets under custody (vaulting it over State Street Corporation, which has $15.1 trillion of assets under custody), and corporate trustee with $8 trillion in assets under trusteeship. It ranks among the top 10 global asset managers with more than $1 trillion in assets under management.
Coincidentally, the merger also brought together two financial institutions that had recently sold off their retail banking
Retail banking
Retail banking is banking in which banking institutions execute transactions directly with consumers, rather than corporations or other banks. Services offered include: savings and transactional accounts, mortgages, personal loans, debit cards, credit cards, and so forth.-Types of...
divisions. Bank of New York sold off their retail banking division to JPMorgan Chase in 2006, while Mellon sold their retail banking division to RBS
Royal Bank of Scotland
The Royal Bank of Scotland Group is a British banking and insurance holding company in which the UK Government holds an 84% stake. This stake is held and managed through UK Financial Investments Limited, whose voting rights are limited to 75% in order for the bank to retain its listing on the...
-owned Citizens Financial Group
Citizens Financial Group
Citizens Financial Group, Inc. is an American bank headquartered in Providence, Rhode Island, which operates in the states of Connecticut, Delaware, Illinois, Massachusetts, Michigan, New Hampshire, New Jersey, New York, Ohio, Pennsylvania, Rhode Island and Vermont. Citizens is a wholly owned...
in 2001.
It ranks as a top-10 U.S. wealth manager with more than $160 billion in client assets, and is a leading U.S. cash management
Cash management
In United States banking, cash management, or treasury management, is a marketing term for certain services offered primarily to larger business customers...
and global payments provider. The company has annual revenues of about $13 billion, and pro-forma market capitalization of about $50 billion. The company has 40 thousand employees around the world. The Bank of New York Mellon Corporation operates in 37 countries, serving more than 100 markets. The company provides financial services for institutions, corporations, and high-net-worth individuals, through a worldwide team. It also services more than $11 trillion in outstanding debt.
Tom Renyi
Tom Renyi
Tom Renyi is the former Chairman and Chief Executive Officer of the Bank of New York Company, a position he held since 1997. He is also the former Executive Chairman of The Bank of New York Mellon Corporation, following BNY and Mellon's merger on July 1, 2007.-Background:Renyi graduated from...
, former chairman and chief executive of Bank of New York, served as executive chairman of Bank of New York Mellon for 18 months following the close of the deal, with overall responsibility for the integration of the two companies, having retired effective July 1, 2008.
Robert P. Kelly
Robert P. Kelly
Robert P. Kelly is the former CEO of The Bank of New York Mellon. Robert Kelly grew up in Nova Scotia, and went to Saint Mary's University in Halifax. After getting an MBA at Cass Business School, he spent 19 years at Toronto-Dominion Bank. He joined First Union as chief financial officer in 2000...
, former president, chairman, and chief executive of Mellon, served as chief executive of the new company and succeeded Renyi as chairman of the board. Gerald L. Hassell, former president of Bank of New York, holds the same position in the new company.On August 31st 2011 Kelly resigned "by mutual agreement with the board of directors,due to differences in approach to managing the company" (quoting the press release issued) and his titles were added to Hassell's.
The board of directors had 10 members designated by Bank of New York, and 8 members designated by Mellon. The new company's headquarters is based in New York City, though they maintain significant operations in Pittsburgh.Kelly's resignation left 13 directors (8 from Bank of New York and 5 from Mellon).
The merger was finalized on July 2, 2007. The principal office of business was set at the One Wall Street office.The BNY Mellon brand name is used for most lines of business.
Post-merger
In February 2008, the company experienced a data spillData spill
A data breach is the intentional or unintentional release of secure information to an untrusted environment. Other terms for this phenomenon include unintentional information disclosure, data leak and also data spill...
, losing an undisclosed number of tapes containing customer information. Victims of the data spill were offered two years of credit monitoring.
In late November 2008, the company announced that due to the global financial crisis, the company would be laying off 1,800 employees, translating into 4% of its global work force, with CEO Robert Kelly citing the need to "reduce expenses" past any post-merger plans.
Financial crisis and anniversary
In October 2008, The Bank of New York Mellon received $3 billion in Troubled Asset Relief Program (TARP) funds from the U.S. Treasury during the financial crisis of 2007–2010. On June 9, 2009, the company paid back the funds in full, along with $136 million to buy back warrantsWarrant (finance)
In finance, a warrant is a security that entitles the holder to buy the underlying stock of the issuing company at a fixed exercise price until the expiry date....
from the Treasury. The bank is the master custodian for the TARP funds, hired by the Treasury to handle accounting and record-keeping for the program.
The bank also celebrated its 225th anniversary on June 9, 2009. The company honored this milestone with a commemorative video addressing its history and prominent position in the global economy.
Historical data
The Bank of New York Mellon was the seventh largest bank at the end of 2008 (not including subsidiaries).Locations
The Bank of New York Mellon operates in more than 100 markets in 36 countries worldwide, the group headquarters located at One Wall Street, European headquarters located in London and Asian headquarters located in Hong Kong.Business segments
- Asset Management (provides asset management services through a number of asset management companies to institutional and individual investors)
- Wealth Management (provides investment management, wealth and estate planning and private banking solutions to high net worth individualHigh net worth individualA high-net-worth individual is a person with a high net worth. In the private banking business, these individuals typically are defined as having investable assets in excess of US$1 million. As explained below, the U.S...
s and families, family offices and business enterprises, charitable gift programs and endowments and foundations) - Asset Servicing (provides global custody and related services and broker-dealer services to corporate and public retirement funds, foundations and endowments and global financial institutions)
- Issuer Services (provides corporate trust, depositary receipt and shareowner services to corporations and institutions)
- Clearing Services (provides clearing, financing and custody services for broker-dealers and registered investment advisors)
- Treasury Services (provides treasury services, global payment services, working capital solutions, capital markets business and large corporate banking)
See also
- Bank of New YorkBank of New YorkThe Bank of New York was a global financial services company established in 1784 by the American Founding Father Alexander Hamilton. It existed until its merger with the Mellon Financial Corporation on July 2, 2007...
- Mellon Financial Corporation
- One Wall Street, Manhattan
- BNY Mellon Center (disambiguation)
- Pershing LLCPershing LLCPershing LLC is a subsidiary of The Bank of New York Mellon, the nation's oldest continuously operating bank, and one of the world's leading providers of securities services. Pershing has nearly $1 trillion in assets under administration...
- CIBC MellonCIBC MellonCIBC Mellon was founded in 1996 as a joint venture between the Canadian Imperial Bank of Commerce and the Mellon Financial Corporation to offer asset servicing to institutional investors...