Bank of New York Mellon Corp

Previous wording

(d) Consists of AUC/A primarily from the Asset Servicing line of business and, to a lesser extent, the Clearance and Collateral Management, Issuer Services, Pershing and Wealth Management lines of business. Includes the AUC/A of CIBC Mellon Global Securities Services Company (“CIBC Mellon”), a joint venture with the Canadian Imperial Bank of Commerce, of $1.7 trillion at March 31, 2024 and Dec. 31, 2023 and $1.5 trillion at March 31, 2023.

Current wording

(d) Consists of AUC/A primarily from the Asset Servicing line of business and, to a lesser extent, the Clearance and Collateral Management, Issuer Services, Pershing and Wealth Management lines of business. Includes the AUC/A of CIBC Mellon Global Securities Services Company (“CIBC Mellon”), a joint venture with the Canadian Imperial Bank of Commerce, of $1.7 trillion at June 30, 2024 and March 31, 2024 and $1.6 trillion at June 30, 2023.

Previous wording

In this Quarterly Report on Form 10-Q, references to “our,” “we,” “us,” “BNY Mellon,” the “Company” and similar terms refer to The Bank of New York Mellon Corporation and its consolidated subsidiaries. The term “Parent” refers to The Bank of New York Mellon Corporation but not its subsidiaries.

Current wording

In this Quarterly Report on Form 10-Q, references to “our,” “we,” “us,” “BNY,” the “Company” and similar terms refer to The Bank of New York Mellon Corporation and its consolidated subsidiaries. The term “Parent” refers to The Bank of New York Mellon Corporation but not its subsidiaries.

Previous wording

BNY Mellon is a global financial services company that helps make money work for the world – managing it, moving it and keeping it safe. For 240 years we have partnered alongside our clients, putting our expertise and platforms to work to help them achieve their ambitions. Today we help over 90% of Fortune 100 companies and nearly all the top 100 banks globally access the money they need. We support governments in funding local projects and work with over 90% of the top 100 pension plans to safeguard investments for millions of individuals, and so much more. As of March 31, 2024, we oversee $48.8 trillion in assets under custody and/or administration and $2.0 trillion in assets under management.

Current wording

BNY is a global financial services company that helps make money work for the world – managing it, moving it and keeping it safe. For 240 years we have partnered alongside our clients, putting our expertise and platforms to work to help them achieve their ambitions. Today we help over 90% of Fortune 100 companies and nearly all the top 100 banks globally access the money they need. We support governments in funding local projects and work with over 90% of the top 100 pension plans to safeguard investments for millions of individuals, and so much more. As of June 30, 2024, we oversee $49.5 trillion in assets under custody and/or administration and $2.0 trillion in assets under management.

Previous wording

BNY Mellon is the corporate brand of The Bank of New York Mellon Corporation (NYSE: BK). We are headquartered in New York City, employ over 50,000 people globally and have been named among Fortune’s World’s Most Admired Companies and Fast Company’s Best Workplaces for Innovators.

Current wording

BNY is the corporate brand of The Bank of New York Mellon Corporation (NYSE: BK). We are headquartered in New York City, employ over 50,000 people globally and have been named among Fortune’s World’s Most Admired Companies and Fast Company’s Best Workplaces for Innovators.

Previous wording

BNY Mellon has three business segments, Securities Services, Market and Wealth Services and Investment and Wealth Management, which offer a comprehensive set of capabilities and deep expertise across the investment life cycle, enabling the

Current wording

BNY has three business segments, Securities Services, Market and Wealth Services and Investment and Wealth Management, which offer a comprehensive set of capabilities and deep expertise across the investment life cycle, enabling the Company to provide solutions to buy-side and sell-

Previous wording

Company to provide solutions to buy-side and sell-side market participants, as well as leading institutional and wealth management clients globally.

Current wording

side market participants, as well as leading institutional and wealth management clients globally.

Previous wording

Net income applicable to common shareholders was $953 million, or $1.25 per diluted common share, in the first quarter of 2024, including the impact of notable items. Notable items in the first quarter of 2024 include severance expense and litigation reserves. Excluding notable items, net income applicable to common shareholders was $982 million (Non-GAAP), or $1.29 (Non-GAAP) per diluted common share, in the first quarter of 2024. Net income applicable to common shareholders was $911 million, or $1.13 per diluted common share, in the first quarter of 2023, including the impact of notable items. Notable items in the first quarter of 2023 include litigation reserves and a disposal loss. Excluding notable items, net income applicable to common shareholders was $915 million (Non-GAAP), or $1.13 (Non-GAAP) per diluted common share, in the first quarter of 2023.

Current wording

Net income applicable to common shareholders was $1,143 million, or $1.52 per diluted common share, in the second quarter of 2024, including the impact of notable items. Notable items in the second quarter of 2024 include a reduction in the FDIC special assessment, severance expense and litigation reserves. Excluding notable items, net income applicable to common shareholders was $1,136 million (Non-GAAP), or $1.51 (Non-GAAP) per diluted common share, in the second quarter of 2024. Net income applicable to common shareholders was $1,036 million, or $1.31 per diluted common share, in the second quarter of 2023, including the impact of

Previous wording

The highlights below are based on the first quarter of 2024 compared with the first quarter of 2023, unless otherwise noted.

Current wording

The highlights below are based on the second quarter of 2024 compared with the second quarter of 2023, unless otherwise noted.

Previous wording

•Fee revenue increased 5%, primarily reflecting higher market values and higher client activity, partially offset by lower foreign exchange volatility, the mix of AUM flows and lower performance fees. (See “Fee and other revenue” beginning on page 6.)

Current wording

•Fee revenue increased 4%, primarily reflecting higher market values, net new business, higher foreign exchange revenue and higher client activity, partially offset by the mix of AUM flows. (See “Fee and other revenue” beginning on page 6.)

Previous wording

•Investment and other revenue increased primarily reflecting higher other investment, other trading and seed capital results. (See “Fee and other revenue” beginning on page 6.)

Current wording

•Investment and other revenue increased primarily reflecting higher client activity in our fixed income and equity trading business. (See “Fee and other revenue” beginning on page 6.)

Previous wording

•Net interest income decreased 8%, primarily reflecting changes in balance sheet mix, partially offset by higher interest rates. (See “Net interest income” on page 9.)

Current wording

•Net interest income decreased 6%, primarily reflecting changes in balance sheet mix, partially offset by higher interest rates. (See “Net interest income” on page 9.)

Previous wording

•Noninterest expense increased 2%, primarily reflecting higher investments, severance expense and employee merit increases, partially offset by efficiency savings. Excluding notable items, noninterest expense increased 1% (Non-GAAP). (See “Noninterest expense” on page 11.)

Current wording

•Noninterest expense decreased 1%, primarily reflecting efficiency savings, a reduction in the FDIC special assessment and lower litigation reserves, partially offset by higher investments, employee merit increases and higher revenue-related expenses. Excluding notable items, noninterest expense increased 1% (Non-GAAP). (See “Noninterest expense” on page 12.)

Previous wording

•Effective tax rate of 22.4%. (See “Income taxes” on page 11.)

Current wording

•Effective tax rate of 23.4%. (See “Income taxes” on page 12.)

Previous wording

•Return on common equity (“ROE”) was 10.7% for the first quarter of 2024. Excluding notable items, the adjusted ROE was 11.0% (Non-GAAP) for the first quarter of 2024.

Current wording

•Return on tangible common equity (“ROTCE”) was 24.6% (Non-GAAP) for the second quarter of 2024. Excluding notable items, the adjusted ROTCE was 24.4% (Non-GAAP) for the second quarter of 2024.

Previous wording

•AUM of $2.0 trillion increased 6%, primarily reflecting higher market values.

Current wording

•AUM of $2.0 trillion increased 7%, primarily reflecting higher market values.

Previous wording

•Our CET1 ratio calculated under the Standardized Approach was 10.8% at March 31, 2024 and 11.5% at Dec. 31, 2023 under the Advanced Approaches. The decrease reflects higher period-end risk-weighted assets and the reduction in capital. (See “Capital” beginning on page 33.)

Current wording

•Our CET1 ratio was 11.4% at June 30, 2024 and 10.8% at March 31, 2024 under the Standardized Approach. The increase reflects an increase in capital and lower risk-weighted assets. (See “Capital” beginning on page 36.)

Previous wording

•Tier 1 leverage was 5.9% at March 31, 2024 and 6.0% at Dec. 31, 2023. The decrease reflects the reduction in capital and higher average assets. (See “Capital” beginning on page 33.)

Current wording

•Tier 1 leverage was 5.8% at June 30, 2024 and 5.9% at March 31, 2024. The decrease reflects higher average assets, partially offset by the increase in capital. (See “Capital” beginning on page 36.)

Previous wording

•Returned $1.3 billion to common shareholders, including $988 million of common share repurchases.

Current wording

•Returned $923 million to common shareholders, including $601 million of common share repurchases.

Previous wording

(c) Consists of AUC/A primarily from the Asset Servicing line of business and, to a lesser extent, the Clearance and Collateral Management, Issuer Services, Pershing and Wealth Management lines of business. Includes the AUC/A of CIBC Mellon of $1.7 trillion at March 31, 2024 and Dec. 31, 2023 and $1.5 trillion at March 31, 2023.

Current wording

(c) Consists of AUC/A primarily from the Asset Servicing line of business and, to a lesser extent, the Clearance and Collateral Management, Issuer Services, Pershing and Wealth Management lines of business. Includes the AUC/A of CIBC Mellon of $1.7 trillion at June 30, 2024 and March 31, 2024 and $1.6 trillion at June 30, 2023.

Previous wording

Fee revenue increased 5% compared with the first quarter of 2023 and 3% compared with the fourth quarter of 2023. The increase compared with the first quarter of 2023 primarily reflects higher investment services fees, partially offset by lower foreign exchange revenue. The increase compared with the fourth quarter of 2023 primarily reflects higher investment services fees and investment management and performance fees.

Current wording

Fee revenue increased 4% compared with the second quarter of 2023 and 3% compared with the first quarter of 2024. The increase compared with the second quarter of 2023 primarily reflects higher investment services fees and foreign exchange revenue. The increase compared with the first quarter of 2024 primarily reflects higher investment services fees and foreign exchange revenue, partially offset by lower investment management and performance fees.

Previous wording

increase compared with the fourth quarter of 2023 primarily reflects higher market values and client activity, partially offset by lower Depositary Receipts revenue.

Current wording

activity, partially offset by lower Depositary Receipts revenue. The increase compared with the first quarter of 2024 primarily reflects higher Depositary Receipts revenue and net new business.

Previous wording

AUC/A totaled $48.8 trillion at March 31, 2024, an increase of 5% compared with March 31, 2023, primarily reflecting higher market values, partially offset by lower collateral management balances. AUC/A consisted of 37% equity securities and 63% fixed income securities at March 31, 2024, and 33% equity securities and 67% fixed income securities at March 31, 2023.

Current wording

AUC/A totaled $49.5 trillion at June 30, 2024, an increase of 6% compared with June 30, 2023, primarily reflecting higher market values. AUC/A consisted of 37% equity securities and 63% fixed income securities at June 30, 2024, and 34% equity securities and 66% fixed income securities at June 30, 2023.

Previous wording

Investment management and performance fees were flat compared with the first quarter of 2023 and increased 4% compared with the fourth quarter of 2023. Compared with the first quarter of 2023, higher market values were offset by the mix of AUM flows and lower performance fees. The increase compared with the fourth quarter of 2023 primarily reflects higher market values, partially offset by the

Current wording

Investment management and performance fees were flat compared with the second quarter of 2023 and decreased 2% compared with the first quarter of 2024. Compared with the second quarter of 2023 higher market values were offset by the mix of AUM flows, lower equity investment income and changes in product mix. The decrease compared with the first quarter of 2024 primarily reflects the mix of AUM

Previous wording

6 BNY Mellon timing of performance fees. Performance fees were $10 million in the first quarter of 2024, $22 million in the first quarter of 2023 and $19 million in the fourth quarter of 2023. On a constant currency basis (Non-GAAP), investment management and performance fees decreased 1% compared with the first quarter of 2023. See “Supplemental information – Explanation of GAAP and Non-GAAP financial measures” beginning on page 41 for the reconciliation of Non-GAAP measures.

Current wording

6 BNY flows and lower equity investment income, partially offset by higher market values. Performance fees were $8 million in the second quarter of 2024, $10 million in the second quarter of 2023 and $10 million in the first quarter of 2024. On a constant currency basis (Non-GAAP), investment management and performance fees were flat compared with the second quarter of 2023. See “Supplemental information – Explanation of GAAP and Non-GAAP financial measures” beginning on page 43 for the reconciliation of Non-GAAP measures.

Previous wording

AUM was $2.0 trillion at March 31, 2024, an increase of 6% compared with March 31, 2023, primarily reflecting higher market values.

Current wording

AUM was $2.0 trillion at June 30, 2024, an increase of 7% compared with June 30, 2023, primarily reflecting higher market values.

Previous wording

Foreign exchange revenue is primarily driven by the volume of client transactions and the spread realized on these transactions, both of which are impacted by market volatility, the impact of foreign currency hedging activities and foreign currency remeasurement gain (loss). Foreign exchange revenue decreased 14% compared with the first quarter of 2023 and increased 6% compared with the fourth quarter of 2023. The decrease compared with the first quarter of 2023 primarily reflects lower volatility. The increase compared with the fourth quarter of 2023 primarily reflects higher volumes. Foreign exchange revenue is primarily reported in the Securities Services business segment and, to a lesser extent, in the Market and Wealth Services and Investment and Wealth Management business segments and the Other segment.

Current wording

Foreign exchange revenue is primarily driven by the volume of client transactions and the spread realized on these transactions, both of which are impacted by market volatility, the impact of foreign currency hedging activities and foreign currency remeasurement gain (loss). Foreign exchange revenue increased 16% compared with the second quarter of 2023 and 21% compared with the first quarter of 2024. Both increases were primarily driven by higher volumes. Foreign exchange revenue is primarily reported in the Securities Services business segment and, to a lesser extent, in the Market and Wealth Services and Investment and Wealth Management business segments and the Other segment.

Previous wording

Financing-related fees, which are primarily reported in the Market and Wealth Services and Securities Services business segments, include capital market fees, loan commitment fees and credit-related fees. Financing-related fees increased 10% compared with the first quarter of 2023 and 27% compared with the fourth quarter of 2023, primarily reflecting higher underwriting fees.

Current wording

Financing-related fees, which are primarily reported in the Market and Wealth Services and Securities Services business segments, include capital market fees, loan commitment fees and credit-related fees. Financing-related fees increased 6% compared with the second quarter of 2023 and decreased 7% compared with the first quarter of 2024. The increase compared with the second quarter of 2023 primarily reflects higher underwriting fees. The decrease compared with the first quarter of 2024 primarily reflects lower underwriting fees, partially offset by higher loan commitment fees.

Previous wording

Investment and other revenue includes income or loss from consolidated investment management funds, seed capital gains or losses, other trading revenue or loss, renewable energy investments gains, income from corporate and bank-owned life insurance contracts, other investment gains or losses, gains or losses from disposals, expense reimbursements from our CIBC Mellon joint venture, other income or loss and net securities gains or losses. The income or loss from consolidated investment management funds should be considered together with the net income or loss attributable to noncontrolling interests, which reflects the portion of the consolidated funds for which we do not have an economic interest and is reflected below net income as a separate line item on the consolidated income statement. Other trading revenue or loss primarily includes the impact of market-risk hedging activity related to our seed capital investments in investment management funds, non-foreign currency derivative and fixed income trading, and other hedging activity. Other investment gains or losses includes fair value changes of non-readily marketable strategic equity, private equity and other investments. Expense reimbursements from our CIBC Mellon joint venture relate to expenses incurred by BNY Mellon on behalf of the CIBC Mellon joint venture. Other income includes various miscellaneous revenues.

Current wording

Investment and other revenue includes income or loss from consolidated investment management funds, seed capital gains or losses, other trading revenue or loss, renewable energy investments gains, income from corporate and bank-owned life insurance contracts, other investment gains or losses, gains or losses from disposals, expense reimbursements from our CIBC Mellon joint venture, other income or loss and net securities gains or losses. The income or loss from consolidated investment management funds should be considered together with the net income or loss attributable to noncontrolling interests, which reflects the portion of the consolidated funds for which we do not have an economic interest and is reflected below net income as a separate line item on the consolidated income statement. Other trading revenue or loss primarily includes the impact of market-risk hedging activity related to our seed capital investments in investment management funds, non-foreign currency derivative and fixed income trading, and other hedging activity. Other investment gains or losses includes fair value changes of non-readily marketable strategic equity, private equity and other investments. Expense reimbursements from our CIBC Mellon joint venture relate to expenses incurred by BNY on behalf of the CIBC Mellon joint venture. Other income includes various miscellaneous revenues.

Previous wording

(a) Includes gains (losses) on investments in BNY Mellon funds which hedge deferred incentive awards.

Current wording

(a) Includes gains (losses) on investments in BNY funds which hedge deferred incentive awards.

Previous wording

The increase in total investment and other revenue compared with the first quarter of 2023 primarily reflects higher other investment, other trading and seed capital results. The increase compared with the fourth quarter of 2023 primarily reflects the reduction in the fair value of a contingent consideration receivable in the fourth quarter of 2023.

Current wording

The increase in total investment and other revenue compared with the second quarter of 2023 primarily reflects higher client activity in our fixed income and equity trading business. The decrease compared with the first quarter of 2024 primarily reflects net securities losses.

Previous wording

Net interest income decreased 8% compared with the first quarter of 2023 and 6% compared with the fourth quarter of 2023. The decrease compared with the first quarter of 2023 primarily reflects changes in balance sheet mix, partially offset by higher interest rates. The decrease compared with the fourth quarter of 2023 primarily reflects changes in balance sheet mix.

Current wording

Net interest income decreased 6% compared with the second quarter of 2023 and 1% compared with the first quarter of 2024. The decrease compared with the second quarter of 2023 primarily reflects changes in balance sheet mix, partially offset by higher interest rates. The decrease compared with the first quarter of 2024 primarily reflects changes in balance sheet mix, partially offset by the benefit of reinvesting maturing fixed-rate securities in higher yielding alternatives.

Previous wording

Net interest margin decreased 10 basis points compared with the first quarter of 2023 and 7 basis points compared with the fourth quarter of 2023. The changes compared with the first quarter of 2023 and the fourth quarter of 2023 primarily reflect the factors mentioned above.

Current wording

Net interest margin decreased 5 basis points compared with the second quarter of 2023 and 4 basis points compared with the first quarter of 2024. The changes compared with the second quarter of 2023 and the first quarter of 2024 primarily reflect the factors mentioned above.

Previous wording

Average interest-earning assets decreased 1% compared with the first quarter of 2023 and increased 1% compared with the fourth quarter of 2023. The decrease compared with the first quarter of 2023 primarily reflects lower securities and interest-bearing deposits with banks, partially offset by higher interest-bearing deposits with the Federal Reserve and other central banks. The increase compared with the fourth quarter of 2023 primarily reflects higher securities balances, partially offset by lower interest-bearing deposits with the Federal Reserve and other central banks.

Current wording

Average interest-earning assets decreased 2% compared with the second quarter of 2023 and increased 2% compared with the first quarter of 2024. The decrease compared with the second quarter of 2023 primarily reflects lower interest-bearing deposits with the Federal Reserve and other central banks and interest-bearing deposits with banks, partially offset by higher loan balances and Federal funds sold and securities purchased under resale agreements. The increase compared with the first quarter of 2024 primarily reflects higher securities and loan balances and federal funds sold and securities purchased under resale agreements.

Previous wording

Average non-U.S. dollar deposits comprised approximately 25% of our average total deposits in the first quarter of 2024. Approximately 45% of the average non-U.S. dollar deposits in the first quarter of 2024 were euro-denominated.

Current wording

Average non-U.S. dollar deposits comprised approximately 25% of our average total deposits in the second quarter of 2024. Approximately 50% of the average non-U.S. dollar deposits in the second quarter of 2024 were euro-denominated.

Previous wording

(a) Includes the average impact of offsetting under enforceable netting agreements of approximately $151 billion for the first quarter of 2024, $141 billion for the fourth quarter of 2023 and $62 billion for the first quarter of 2023. On a Non-GAAP basis, excluding the impact of offsetting, the yield on federal funds sold and securities purchased under resale agreements would have been 5.49% for the first quarter of 2024, 5.48% for the fourth quarter of 2023 and 4.62% for the first quarter of 2023. On a Non-GAAP basis, excluding the impact of offsetting, the rate on federal funds purchased and securities sold under repurchase agreements would have been 5.38% for the first quarter of 2024, 5.35% for the fourth quarter of 2023 and 4.49% for the first quarter of 2023. We believe providing the rates excluding the impact of netting is useful to investors as it is more reflective of the actual rates earned and paid.

Current wording

(a) Includes the average impact of offsetting under enforceable netting agreements of approximately $163 billion for the second quarter of 2024, $151 billion for the first quarter of 2024 and $113 billion for the second quarter of 2023. On a Non-GAAP basis, excluding the impact of offsetting, the yield on federal funds sold and securities purchased under resale agreements would have been 5.51% for the second quarter of 2024, 5.49% for the first quarter of 2024 and 5.10% for the second quarter of 2023. On a Non-GAAP basis, excluding the impact of offsetting, the rate on federal funds purchased and securities sold under repurchase agreements would have been 5.41% for the second quarter of 2024, 5.38% for the first quarter of 2024 and 4.99% for the second quarter of 2023. We believe providing the rates excluding the impact of netting is useful to investors as it is more reflective of the actual rates earned and paid.

Previous wording

Total noninterest expense increased 2% compared with the first quarter of 2023, primarily reflecting higher investments, severance expense and employee merit increases, partially offset by efficiency savings. Excluding notable items, noninterest expense increased 1% (Non-GAAP) compared with the first quarter of 2023. The investments in growth, infrastructure and efficiency initiatives are primarily included in staff, software and equipment, and professional, legal and other purchased services expenses. Total noninterest expense decreased 21% compared with the fourth quarter of 2023, primarily reflecting the impact of notable items recorded in 2023, including the Federal Deposit Insurance Corporation (“FDIC”) special assessment, severance expense and litigation reserves, and the favorable impact of efficiency savings, partially offset by higher revenue-related expenses. Excluding notable items, noninterest expense increased 1% (Non-GAAP) compared with the fourth quarter of 2023.

Current wording

Total noninterest expense decreased 1% compared with the second quarter of 2023, primarily reflecting efficiency savings, a reduction in the FDIC special assessment and lower litigation reserves, partially offset by higher investments, employee merit increases and higher revenue-related expenses. Excluding notable items, noninterest expense increased 1% (Non-GAAP) compared with the second quarter of 2023. The investments in growth, infrastructure and efficiency initiatives are primarily included in staff, software and equipment, and professional, legal and other purchased services expenses. Total noninterest expense decreased 3% compared with the first quarter of 2024, primarily reflecting lower staff expense driven by the annual vesting of stock-based award to retirement-eligible employees recorded in the first quarter of 2024, as well as a reduction in the FDIC special assessment and efficiency savings, partially offset by employee merit increases. Excluding notable items, noninterest expense decreased 2% (Non-GAAP) compared with the first quarter of 2024.

Previous wording

BNY Mellon recorded an income tax provision of $297 million (22.4% effective tax rate) in the first quarter of 2024. The income tax provision was $306 million (23.8% effective tax rate) in the first quarter of 2023 and $73 million (26.2% effective tax rate) in the fourth quarter of 2023.

Current wording

BNY recorded an income tax provision of $357 million (23.4% effective tax rate) in the second quarter of 2024. The income tax provision was $315 million (22.7% effective tax rate) in the second quarter of 2023 and $297 million (22.4% effective tax rate) in the first quarter of 2024.

Previous wording

For information on the accounting principles of our business segments, see Note 19 of the Notes to Consolidated Financial Statements. For information on the primary products and services in each line of business, the primary types of revenue by line of

Current wording

For information on the accounting principles of our business segments, see Note 19 of the Notes to Consolidated Financial Statements. For information on the primary products and services in each line of business, the primary types of revenue by line of business and how our business segments are presented and analyzed, see Note 24 of the Notes to Consolidated Financial Statements in our 2023 Annual Report.

Previous wording

Business segment results are subject to reclassification when organizational changes are made, or for refinements in revenue and expense allocation methodologies. Refinements are typically reflected on a prospective basis. In the first quarter of 2024, we made certain realignments of similar products and services within our lines of business consistent with the firm’s ongoing transition to a platforms operating model uniting related capabilities and enabling streamlining of internal processes to drive growth, efficiency, resiliency, and enhanced risk management. The largest change was the movement of Institutional Solutions from Pershing to Clearance and Collateral Management, both in the Market and Wealth Services business segment. We made other smaller changes that moved activity from Asset Servicing in the Securities Services business segment to Treasury Services in the Market and Wealth Services business segment, and from Wealth Management in the Investment and Wealth Management business segment and Pershing in the Market and Wealth Services business segment to Investment Management in the Investment and Wealth Management business segment. The Other segment was not impacted by the changes. Prior period business segment results have been revised to reflect these changes.

Current wording

Business segment results are subject to reclassification when organizational changes are made, or for refinements in revenue and expense allocation methodologies. Refinements are typically reflected on a prospective basis. There were no reclassifications or organizational changes in the second quarter of 2024. In the first quarter of 2024, we made certain realignments of similar products and services within our lines of business consistent with the firm’s ongoing transition to a platforms operating model uniting related capabilities and enabling streamlining of internal processes to drive growth, efficiency, resiliency, and enhanced risk management. The largest change was the movement of Institutional Solutions from Pershing to Clearance and Collateral Management, both in the Market and Wealth Services business segment. We made other smaller changes that moved activity from Asset Servicing in the Securities Services business segment to Treasury Services in the Market and Wealth Services business segment, and from Wealth Management in the Investment and Wealth Management business segment and Pershing in the Market and Wealth Services business segment to Investment Management in the Investment and Wealth Management business segment. The Other segment was not impacted by the changes. Business segment results for the three- and six- months ended June 30, 2023 have been revised to reflect these changes.

Previous wording

The results of our business segments may be influenced by client and other activities that vary by quarter. In the first quarter, staff expense typically increases, reflecting the vesting of long-term stock awards for retirement-eligible employees. The timing of our annual employee merit increases also impacts staff expense. In 2024, the merit increase was effective in March, thus partially impacting the first quarter and second quarter staff expense variances. For 2023, the merit increase was effective at the beginning of the second quarter. In the third quarter,

Current wording

quarter. In the first quarter, staff expense typically increases, reflecting the vesting of long-term stock awards for retirement-eligible employees. The timing of our annual employee merit increases also impacts staff expense. In 2024, the merit increase was effective in March, thus partially impacting the first quarter and second quarter staff expense variances. For 2023, the merit increase was effective at the beginning of the second quarter. In the third quarter, volume-related fees may decline due to reduced client activity. In the fourth quarter, we typically incur higher business development and marketing expenses. In our Investment and Wealth Management business segment, performance fees are typically higher in the fourth and first quarters, as those quarters represent the end of the measurement period for many of the performance fee-eligible relationships.