StockCall Scrutiny on Bank of New York: Growth Amidst Tough Operating Environment

Fri Jan 18, 2013 8:41am EST

* Reuters is not responsible for the content in this press release.

LONDON, January 18, 2013 /PRNewswire/ --

    The volatile global economic environment and stricter regulations since the
financial crisis has meant that the operating environment for asset management industry,
which includes hedge funds, private equity funds and mutual fund companies, has been
tough. Still, the performance of the asset management industry has been robust. Our
analysts have issued a technical analysis on Bank of New York Mellon Corporation (NYSE :
BK), which is available for free. Sign up now at  

    http://www.stockcall.com/analysis  

    Earlier this week, Bank of New York Mellon Corporation (NYSE : BK), an investment
management company, reported strong results for the fourth quarter of 2012. BNY Mellon
posted sturdy year-over-year growth in fees in its Investment Management, Asset
Servicing, Clearing and Treasury Services businesses for the fourth quarter. Our free
technical analysis on Bank of New York Mellon is available at  

    http://www.StockCall.com/BK011813.pdf  

    Gerald L. Hassell, Chairman and CEO of BNY Mellon, said that the company benefited
from the improvement in market values and, more importantly, from its relentless focus
on generating organic growth with its broad client base. Hassell said that the company
is driving its operational excellence initiatives to improve its efficiency and help
mitigate the impact on its high margin revenues due to the low interest rate environment
and tepid capital market activity.  

    At the end of the fourth quarter, BNY Mellon's assets under custody totaled $26.7
trillion, up 9% over the same period in the previous year.  

    Looking ahead, BNY Mellon expects their debt ceiling issue to remain a worry for
investors. Speaking at a conference call after the release of quarterly results, the CEO
said that there is still an enormous amount of cash sitting on the sidelines waiting for
better certainty and clarity.  

    Since the financial crisis, investors have become more risk averse and are
conducting stronger due diligence on investment managers. However, asset managers such
as BNY Mellon are in a position to respond to clients' requirements due to their size.
Larger asset management firms such as BNY Mellon are also in a better position to adapt
to stricter regulatory environment.  

    While the financial crisis had a significant impact on the entire asset management
industry, private equity business suffered the most. Following the crisis, quality deals
and funding dried up. However, the slump in the private equity business may be coming to
an end.  

    Earlier this week, reports surfaced that personal computer maker Dell Inc. is in
talks with private equity firms over a possible buyout. If Dell goes ahead then the
transaction would be one of the biggest leveraged buyouts in the Technology sector. It
would also mark the return of mega leveraged buyout deals, which were seen before the
financial crisis of 2008. Dell apparently is in talks with private equity firm Silver
Lake Partners for a possible.  

    The Wall Street Journal(1), citing people familiar with the situation, reported that
Blackstone Group [Free Research Report on BX [http://www.StockCall.com/BX011813.pdf
]](2) has also been approached by Dell's bankers to come up with a bid for the personal
computer maker. However, a person familiar with the matter told WSJ that Blackstone is
not contemplating a bid at the moment.  

    Footer:  

        
        1) Source: Wall Street Journal Article - Bankers Reach Out to Blackstone,
          Others to Test PE Interest for Dell Bids [
         
http://blogs.wsj.com/deals/2013/01/17/bankers-reach-out-to-blackstone-others-to-test-pe-interest-for-dell-bids/?mod=MarketsMain
          ] 
        2) The Blackstone Group L.P. Technical Analysis [
          http://www.StockCall.com/TheBlackstoneGroupLP011813.pdf ]


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