The Bank of New York Mellon Corporation

Good morning and welcome to the 2025 Third Quarter Earnings Conference Call hosted by BNY. At this time, all participants are in a listen-only mode. Later, we will conduct a question and answer session. Please note that this conference call and webcast will be recorded and will consist of copyrighted material. You may not record or rebroadcast these materials without BNY's consent. I will now turn the call over to Marius Merz, BNY Head of Investor Relations. Please go ahead.

Thank you, Operator. Good morning, everyone, and welcome to our third quarter earnings call. I'm here with Robin Vins, our Chief Executive Officer, and Dermot McDonough, our Chief Financial Officer. As always, we will reference the quarterly update presentation, which can be found on the Investor Relations page of our website at bny.com. and I'll note that our remarks will contain forward-looking statements and non-GAAP measures. Actual results may differ materially from those projected in the forward-looking statements. Information about these statements and non-GAAP measures is available in the earnings press release, financial supplement, and quarterly update presentation, all of which can be found on the investor relations page of our website. Forward-looking statements made on this call speak only as of today, October 16, 2025, and will not be updated. With that, I will turn it over to Robin.

Thanks, Marius. Good morning, everyone, and thank you for joining us. Let me start with a few highlights before Dermot takes you through our financials for the quarter in greater detail. As summarized on page two of our quarterly update presentation, BNY reported another quarter of strong results. Record revenue of $5.1 billion was up 9% year over year. We saw broad-based strength, including double-digit revenue growth across the platforms that make up our security services and market and wealth services segments, and we drove approximately 500 basis points of positive operating leverage. Our pre-tax margin improved to 36%, and we generated a return on tangible common equity of 26%. Taken together, we reported earnings per share of $1.88 up 25% year over year. The third quarter presented a largely constructive operating environment. Despite a cooling labor market and inflation lingering above the Federal Reserve's 2% target, the U.S. economy remained resilient. Equity markets continued to climb, credit spreads remained tight, and the Fed ultimately resumed rate cuts. Across our platforms, we saw solid growth in client balances, as well as robust trading, clearing, and settlement activity. While the finalization of U.S. tax legislation and the prospect of deregulation are positives for the economic outlook, Uncertainty and multiple tail risks remain. Geopolitical conditions, trade policies, fiscal deficits around the world, and the sustainability of enthusiastic markets, to name a few. Against this backdrop, we continue to execute on our mission of reimagining BNY. This includes our two core transformation programs, a new commercial model and our platforms operating model. Both are continuing to show results, and both have a lot of runway ahead. We recently reached the one-year anniversary of the new commercial model. Year one was about bringing the company together, aligning our teams, and proving that when we show up as one BNY, we can win. Now we are raising the bar. The next phase of our commercial model is about embedding the habits of operating as one BNY into our daily rhythms and shifting from just connecting the dots to also delivering integrated solutions with pace and scale. We were pleased to announce several wins in the third quarter that demonstrate how BNY is powering growth for our clients, both longstanding and new. Franklin Templeton, a client for nearly three decades, expanded its relationship with BNY to provide a full suite of asset servicing and FX capabilities for its US-listed ETF products, tapping our market-leading platform to support one of its fastest-growing businesses. And TIAA, who has had a 20-year relationship with BNY Pershing, yesterday announced that they have selected our Wove platform as the unified wealth solution across TIAA wealth management broker-dealer, investment advisor, and bank custody businesses. Our early commitment to the digital asset space, paired with the principles of safety, scalability, and innovation that have defined BNY for centuries, now positions us to support the growing institutional adoption of digital asset products. In just one example from this past quarter, Open Eden, a leading platform for the tokenization of real-world assets headquartered in Singapore, appointed BNY as investment manager and primary custodian for the underlying assets of its flagship tokenized U.S. Treasury bills fund. As global capital markets move toward an always-on operating model, blockchain technology and digital asset adoption are becoming important enablers. In a meaningful step toward enhancing the utility of money market fund shares, we announced a collaborative initiative with Goldman Sachs to maintain, on blockchain technology, a mirror record of customers' ownership of select money market funds, live and available through our Liquidity Direct platform. This includes a new token-enabled share class of our own BNY Investments Dreyfus Treasury Securities Cash Management Fund. We are encouraged by developments in the U.S. regulatory landscape that will further enable tokenized products and allow us to support clients as they consider moving to a more on-chain financial world. All of this product innovation combined with our commercial model 2.0 is allowing us to be more for our clients and drive higher and more sustainable organic growth in the years to come. Turning to another one of our transformations, the ongoing transition into our platform's operating model. More than 70% of employees are now working in the model, and we expect to complete the remaining transition over the course of the next year. It is still early days, but we continue to gather meaningful proof points of benefits. For example, faster client onboarding, more automated delivery of complex navs, and more modern billing processes. Our progress in the model is creating real capacity to invest in growth, to innovate for clients, and to power our culture. Our experience has been that it takes 12 to 18 months after the initial activation of a platform for teams to start realizing the full benefits of this new way of working. That means that while we will be entirely operational in the new model by the fall of next year, we don't expect to see the full benefits of these new operating rhythms until early 2028. As we continue making steady progress on both of our two transformations, as well as the broader reimagining of our company, we are always focused on what's next. A prime example of this is how we are embracing the power and benefits of AI. This past quarter, we announced a collaboration with Carnegie Mellon University in Pittsburgh to create the BNY AI Lab at CMU. By bringing together CMU's academic leadership and BNY's market expertise, we will advance AI research, responsible governance, and deployment. At BNY, AI is for everyone, everywhere, and for everything. The investments we've made have been focused on creating the technology foundation to go faster, but adoption and success are ultimately driven by culture. By putting AI in the hands of everyone at BNY, we intend to develop fluency and create capacity for our people to focus on higher value work. This translates to how we show up for our clients and innovate more broadly. Last month, we launched the next version of BNY's AI platform, ELISA 2.0, smarter, faster, and easier to use. Across the company, our people are working together to embed AI solutions into our workflows. By the end of the third quarter, we had 117 AI solutions in production. That is an increase of 75% compared to the prior quarter. And it includes agents that help identify new business leads, write code, automate payment processing, accelerate client onboarding, and increase automation of reconciliations. We are also leveraging agentic AI to deploy digital employees. Over 100 of them are already working side by side with our people on tasks such as payment validations and code repairs. We believe our AI opportunity is significant and we are pursuing it with urgency. Before I hand it over to Dermot, I want to close by acknowledging the tremendous work of our people. As I visit our offices around the world and spend time with our teams, the excitement and drive within the company is palpable. It is our people and culture that propel us forward on our mission to unlock BNY's full potential for our clients and our shareholders. We are executing with purpose, powering our culture to run our company better so that we can be more for our clients. We have a lot of work ahead of us, but the clear signs of progress both in terms of our reported financials and the leading indicators for future success across the company, give us confidence that the strategy is working. With that, over to you, Dermot.