Exhibit 99.2

THE BANK OF NEW YORK MELLON CORPORATION

Financial Trends

Notes:

The following transactions/changes have impacted the reporting of our results:

On July 1, 2010 and August 2, 2010 we completed the acquisitions of Global Investment Servicing (“GIS”) and BHF Asset Servicing GmbH (“BAS”). The financial results for GIS are included in the Asset Servicing, Clearing Services and Treasury Services businesses. The financial results for BAS are included in the Asset Servicing business.

On Jan. 1, 2010, we adopted SFAS No. 167, “Amendments to FASB Interpretation No. 46 (R).” Certain asset management funds and seed capital investments are now disclosed separately on our balance sheet and securitizations are included in available for sale securities. The income statement separately discloses the operations of consolidated asset management funds and the net income attributable to noncontrolling interests of consolidated asset management funds; previously these were disclosed as asset and wealth management revenue and investment and other income.

On November 2, 2009, we completed the acquisition of Insight Asset Management (“Insight”) based in London. The financial results for Insight are included in the Asset Management business.

On June 30, 2009, we adopted discontinued operations accounting for Mellon United National Bank (MUNB) located in Miami, Florida. Previously, the financial results were included in the Other business. On January 15, 2010, we completed the sale of MUNB. The financial results for all periods were restated.

On January 1, 2009, we adopted FAS 160, which resulted in a reclassification of minority interest to equity from other liabilities on the balance sheet and to noncontrolling interest from other expense on the income statement.

During the first quarter of 2009, we moved the financial results of the Execution business from the Clearing Services business to the Other business. Historical business results have been restated to reflect these changes.

On June 3, 2008, we completed the sale of Mellon 1st Business Bank, National Association (N.A.). We moved the financial results from the Wealth Management business to the Other business. Historical results have been restated to reflect these changes.

The following items have impacted the reporting of our results:

Results for the first quarter of 2010 include a charge related to special litigation reserves.

Investment Securities Portfolio restructuring/Investment Write-downs – Impacted total revenue levels in the full year of 2008 and full year of 2009.

The TARP preferred dividends and related redemption premium impacted the fourth quarter of 2008 and the first and second quarters of 2009.

The FDIC Special Assessment of all depository institutions impacted the second quarter of 2009.

Global efficiency restructuring charges – Recorded charges in the fourth quarters of 2008 and 2009 and third quarter of 2010

SILO/LILO/Tax settlement charges – Incurred charges in the second and third quarters of 2008, while the second quarter of 2009 contains the benefit of final tax settlements.

Support agreement charges – Recorded a $163 million pre-tax charge in the fourth quarter of 2008 and a $726 million pre-tax charge in the third quarter of 2008. Minor amounts were recorded in other periods.

All of these items are detailed in the trends that follow.

Summations may not equal due to rounding. As a result of this rounding convention, immaterial differences may exist between the business trends data versus business data on the Form 10-K for the year ended December 31, 2010.

Certain immaterial reclassifications have been made to prior periods to place them on a basis comparable with the current periods presentation.

Discontinued Operations Accounting:

The income/(loss) and average assets from discontinued operations accounting have not been allocated to any business.

Average Assets:

In businesses where average deposits are greater than average loans, average assets include an allocation of investment securities equal to the difference. Consolidated average assets include average assets of discontinued operations.

Return on Common and Tangible Common Equity/Pretax Operating Margin:

Ratios are presented for continuing operations basis only. Quarterly return on common and tangible common equity ratios are annualized.

Non-GAAP Measures:

Certain Non-GAAP measures are included in the following schedules. These measures are used by management to monitor financial performance, both on a company-wide and on a business basis. These Non-GAAP measures impact certain revenue/expense categories, percentages and ratios by the exclusion and/or adjustment of items listed above and described in footnotes. For further information, see ‘Non-GAAP Financial Measures’ and ‘Supplemental Information – Explanation of Non-GAAP Financial Measures’ in The Bank of New York Mellon Corporation Quarterly Earnings Review dated January 19, 2011, furnished as an exhibit to the Report on Form 8-K to which these Financial Trends are furnished as an exhibit.

 

Page 1 of 19

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THE BANK OF NEW YORK MELLON CORPORATION

CONTINUING OPERATIONS - 12 Quarter Trend

 

(dollar amounts in millions unless otherwise  noted)		2008																2009																2010
		1st Qtr				2nd Qtr (a)				3rd Qtr (a), (b)				4th Qtr (b)				1st Qtr				2nd Qtr (c)				3rd Qtr (d)				4th Qtr				1st Qtr				2nd Qtr				3rd Qtr				4th Qtr
Revenue:
Securities servicing fees
Asset servicing		$	903			$	873			$	808			$	786			$	609			$	671			$	643			$	650			$	637			$	668			$	870			$	914
Issuer services			376				444				477				388				364				372				359				368				333				354				364				409
Clearing services			263				264				259				279				253				250				236				223				230				245				252				278
Total securities servicing fees			1,542				1,581				1,544				1,453				1,226				1,293				1,238				1,241				1,200				1,267				1,486				1,601
Asset and wealth management fees			862				860				795				701				622				645				664				746				686				686				696				800
Foreign exchange & other trading			259				308				385				510				307				237				246				246				262				220				146				258
Treasury services			124				129				129				132				125				132				128				134				131				125				132				129
Distribution and servicing			98				110				107				106				101				95				73				57				48				51				56				55
Financing-related fees			47				51				44				44				48				54				56				57				50				48				49				48
Investment and Other Income			123				102				84				112				(2	)			53				205				81				145				145				97				80
Total fee revenue			3,055				3,141				3,088				3,058				2,427				2,509				2,610				2,562				2,522				2,542				2,662				2,971
Securities gains (losses)			(73	)			(152	)			(162	)			(1,241	)			(295	)			(256	)			(4,833	)			15				7				13				6				1
Total fee and other revenue			2,982				2,989				2,926				1,817				2,132				2,253				(2,223	)			2,577				2,529				2,555				2,668				2,972
Income of consolidated asset management funds			—				—				—				—				—				—				—				—				65				65				37				59
Net interest revenue			743				388				681				1,047				775				700				716				724				765				722				718				720
Total revenue			3,725				3,377				3,607				2,864				2,907				2,953				(1,507	)			3,301				3,359				3,342				3,423				3,751
Provision for credit losses			14				13				23				54				59				61				147				65				35				20				(22	)			(22	)
Noninterest expenses			2,357				2,471				3,090				2,468				2,091				2,145				2,158				2,266				2,146				2,219				2,429				2,624
Special Litigation Reserves			N/A				N/A				N/A				N/A				N/A				N/A				N/A				N/A				164				N/A				N/A				N/A
FDIC special assessment			—				—				—				—				—				61				—				—				—				—				—				—
Amortization of intangible assets			119				123				118				113				107				108				104				107				97				98				111				115
Restructuring charges			—				—				—				181				10				6				(5	)			139				7				(15	)			15				21
Merger & integration expense			126				149				111				97				68				59				54				52				26				14				56				43
Total noninterest expense			2,602				2,743				3,319				2,859				2,276				2,379				2,311				2,564				2,440				2,316				2,611				2,803
Income/ (loss) from continuing operations before taxes			1,109				621				265				(49	)			572				513				(3,965	)			672				884				1,006				834				970
Income taxes			358				312				(42	)			(137	)			161				12				(1,527	)			(41	)			258				304				220				265
Income/ (loss) from continuing operations			751				309				307				88				411				501				(2,438	)			713				626				702				614				705
Income/ (loss) from discontinued operations, net of tax			4				6				—				4				(41	)			(91	)			(19	)			(119	)			(42	)			(10	)			(3	)			(11	)
Net income attributable to noncontrolling interest			(9	)			(6	)			(4	)			(5	)			(1	)			2				(1	)			(1	)			(25	) (j)			(34	) (j)			11	(j)			(15	) (j)
Extraordinary (loss) on consolidation of commercial paper conduit, net of tax			—				—				—				(26	)			—				—				—				—				—				—				—				—
Redemption charge and preferred dividends			—				—				—				(33	)			(47	)			(236	)			—				—				—				—				—				—
Net income/ (loss) applicable to shareholders of The Bank of New York Mellon Corporation		$	746			$	309			$	303			$	28			$	322			$	176			$	(2,458	)		$	593			$	559			$	658			$	622			$	679
EPS from continuing operations		$	0.65			$	0.26			$	0.26			$	0.04			$	0.31			$	0.23			$	(2.04	)		$	0.59			$	0.49			$	0.55			$	0.51			$	0.55
EPS from continuing operations - Non-GAAP (e)		$	0.75			$	0.75			$	0.81			$	0.96			$	0.56			$	0.51			$	0.54			$	0.55			$	0.59			$	0.55			$	0.55			$	0.59
Market value of assets under management at period-end (in billions)		$	1,105			$	1,113			$	1,067			$	928			$	881			$	926			$	966			$	1,115			$	1,105			$	1,047			$	1,141			$	1,172
Market value of assets under custody and administration at period-end (in trillions)		$	23.1			$	23.0			$	22.4			$	20.2			$	19.5			$	20.7			$	22.1			$	22.3			$	22.4			$	21.8			$	24.4			$	25.0
Market value of securities on loan at period-end (in billions)		$	660			$	588			$	470			$	326			$	293			$	290			$	299			$	247			$	253			$	248			$	279			$	278
Pre-tax operating margin
GAAP-before extraordinary (loss)			30	%			19	%			7	%			(2	)%			20	%			17	%			N/M				20	%			26	%			30	%			24	%			26	%
Non-GAAP adjusted (f)			38	%			37	%			39	%			43	%			33	%			31	%			31	%			29	%			34	%			32	%			30	%			30	%
Return on tangible common equity (annualized):
Non-GAAP-before extraordinary (loss)			35.4	%			18.5	%			18.9	%			6.5	%			28.8	%			18.4	%			N/M				33.0	%			25.8	%			25.8	%			26.3	%			27.5	%
Non-GAAP adjusted (g)			40.7	%			45.9	%			50.2	%			61.3	%			44.4	%			24.0	%			31.5	%			31.1	%			30.2	%			25.5	%			27.9	%			29.1	%
Return on common equity (annualized)
GAAP-before extraordinary (loss)			10.1	%			4.3	%			4.3	%			0.8	%			5.8	%			4.0	%			N/M				9.8	%			8.2	%			8.8	%			7.8	%			8.5	%
Non-GAAP adjusted - excluding intangible amortization (h)			12.7	%			13.2	%			14.2	%			16.8	%			10.6	%			6.6	%			9.9	%			10.1	%			10.6	%			9.5	%			9.2	%			9.9	%
Percent of non-US fee and net interest revenue) - GAAP			33	%			39	%			35	%			44	%			31	%			32	%			N/M				36	%			34	%			35	%			36	%			38	%
Percent of non-US fee and net interest revenue) - Non-GAAP (i)			33	%			34	%			32	%			31	%			29	%			31	%			31	%			36	%			35	%			35	%			36	%			38	%

 

(a)	The second and third quarters of 2008 include pretax SILO/LILO/tax settlement charges which reduced net interest revenue by $377 million and $112 million, respectively. See page 4 for additional details.

 

(b)	The third and fourth quarters of 2008 include pretax support agreement charges of $726 million and $163 million, respectively.

 

(c)	The second quarter of 2009 contains $134 million of tax benefits related to the final LILO/SILO tax settlement.

 

(d)	The third quarter of 2009 includes a $4.8 billion pretax charge related to investment securities portfolio restructuring.

 

(e)

Calculated excluding investment securities losses, TARP redemption premium/dividend, FDIC special assessment, SILO/LILO/tax settlements, 3rd and 4th quarters of 2008 support agreement charges, M&I expenses, restructuring charges, benefit of tax settlements and tax discrete benefits and 1st quarter 2010 special litigation reserves.

 

(f)

Calculated excluding investment securities losses, SILO/LILO charges, 3rd and 4th quarters of 2008 support agreement charges, asset-based taxes, FDIC special assessment, M&I expenses, restructuring charges, intangible amortization, 1st quarter 2010 special litigation reserves and 1st, 2nd, 3rd and 4th quarters 2010 noncontrolling interests of consolidated asset management funds.

 

(g)	Calculated excluding net securities gains (losses), special litigation reserves, FDIC special assessment, restructuring charges, M&I expenses and discrete tax benefit/benefit of tax settlements.

 

(h)	Calculated excluding amortization of intangible assets, net securities gains (losses), special litigation reserves, FDIC special assessment, restructuring charges, M&I expenses and discrete tax benefit/benefit of tax settlements.

 

(i)	Calculated excluding the SILO/LILO charges, net securities gains (losses) and including noncontrolling interest related to consolidated asset management funds.

 

(j)	Includes $24 million for the first quarter of 2010, $33 million for the second quarter of 2010, ($12) million for the third quarter of 2010 and $14 million for the fourth quarter of 2010 related to consolidated asset management funds.

 

Note:

See pages 3 through 6 for additional details of revenue/expense items impacting continuing operations.

 

Page 2 of 19

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THE BANK OF NEW YORK MELLON CORPORATION

CONTINUING OPERATIONS - 12 Quarter Trend

FEE AND OTHER REVENUE

 

		2008																2009																2010
(dollar amounts in millions unless otherwise noted)		1st Qtr				2nd Qtr				3rd Qtr				4th Qtr				1st Qtr				2nd Qtr				3rd Qtr (a)				4th Qtr				1st Qtr				2nd Qtr				3rd Qtr				4th Qtr
Securities servicing fees
Asset servicing		$	658			$	671			$	653			$	599			$	519			$	574			$	600			$	621			$	608			$	622			$	832			$	877
Securities lending			245				202				155				187				90				97				43				29				29				46				38				37
Issuer services			376				444				477				388				364				372				359				368				333				354				364				409
Clearing services			263				264				259				279				253				250				236				223				230				245				252				278
Total securities servicing fees			1,542				1,581				1,544				1,453				1,226				1,293				1,238				1,241				1,200				1,267				1,486				1,601
Asset and wealth management fees			862				860				795				701				622				645				664				746				686				686				696				800
Foreign exchange & other trading			259				308				385				510				307				237				246				246				262				220				146				258
Treasury services			124				129				129				132				125				132				128				134				131				125				132				129
Distribution and servicing			98				110				107				106				101				95				73				57				48				51				56				55
Financing-related fees			47				51				44				44				48				54				56				57				50				48				49				48
Investment and Other Income			123				102				84				112				(2	)			53				205				81				145				145				97				80
Total fee revenue			3,055				3,141				3,088				3,058				2,427				2,509				2,610				2,562				2,522				2,542				2,662				2,971
Income of consolidated asset management funds, net of noncontrolling interest			—				—				—				—				—				—				—				—				41	(c)			32	(c)			49	(c)			45	(c)
Total fee revenue - Non-GAAP			3,055				3,141				3,088				3,058				2,427				2,509				2,610				2,562				2,563				2,574				2,711	(d)			3,016	(d)
Net securities gains (losses)			(73	)			(152	)			(162	)			(1,241	)			(295	)			(256	)			(4,833	)			15				7				13				6				1
Total fee and other revenue - Non-GAAP			2,982				2,989				2,926				1,817				2,132				2,253				(2,223	)			2,577				2,570				2,587				2,717				3,017
Fee and other revenue as a percentage of total revenue			80	%			89	%			81	%			63	%			73	%			76	%			n/m				78	%			75	%			76	%			78	%			79	%
Fee and other revenue as a percentage of total revenue - Non-GAAP (b)			80	%			80	%			80	%			74	%			76	%			78	%			78	%			78	%			75	%			76	%			78	%			79	%
Market value of assets under management at period-end (in billions)		$	1,105			$	1,113			$	1,067			$	928			$	881			$	926			$	966			$	1,115			$	1,105			$	1,047			$	1,141			$	1,172
Market value of assets under custody and administration at period-end (in trillions)		$	23.1			$	23.0			$	22.4			$	20.2			$	19.5			$	20.7			$	22.1			$	22.3			$	22.4			$	21.8			$	24.4			$	25.0
Market value of securities on loan at period-end (in billions)		$	660			$	588			$	470			$	326			$	293			$	290			$	299			$	247			$	253			$	248			$	279			$	278
S&P 500 Index - period-end			1323				1280				1166				903				798				919				1057				1115				1169				1031				1141				1258
S&P 500 Index - daily average			1353				1371				1252				916				809				891				995				1088				1123				1135				1095				1204

 

(a)	The third quarter of 2009 includes a $4.8 billion charge related to investment securities portfolio restructuring.

 

(b)	Excludes net securities gains/(losses) and SILO/LILO charges.

 

(c)	Includes $25 million, $29 million, $36 million and $35 million previously included in asset and wealth management fees and $16 million, $3 million, $13 million and $10 million previously included in investment and other income for the first, second, third and fourth quarters of 2010, respectively.

 

(d)	Total fee revenue from the GIS/BAS acquisitions was $234 million and $246 million in the third and fourth quarters of 2010, respectively.

 

Page 3 of 19

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THE BANK OF NEW YORK MELLON CORPORATION

CONTINUING OPERATIONS

Average Balances and Interest Rates

 

		Quarter Ended
		March 31, 2008								June 30, 2008								September 30, 2008								December 31, 2008								March 31, 2009								June 30, 2009
(dollar amounts in millions)		Average balance				Average rates				Average balance				Average rates				Average balance				Average rates				Average balance				Average rates				Average balance				Average rates				Average balance				Average rates
Assets
Interest-earning assets:
Interest-bearing deposits with banks (primarily foreign)		$	38,658				4.28	%		$	43,361				3.82	%		$	43,999				3.90	%		$	78,680				2.65	%		$	56,505				1.56	%		$	56,917				1.18	%
Interest-bearing deposits with Federal Reserve bank			—				—				—				—				—				—				—				—				23,192				0.37				6,338				0.37
Other Short Term Investment (FRB)			—				—				—				—				954				2.95				8,378				3.05				1,269				3.15				—				—
Federal funds sold and securities under resale agreements			8,191				3.15				6,736				2.21				7,019				1.97				4,050				1.32				2,310				0.81				2,899				1.29
Margin loans			5,258				4.47				5,802				3.36				5,764				3.27				4,885				2.35				4,219				1.63				4,134				1.62
Non-margin loans:
Domestic offices			27,885				4.37				26,550				(1.97	)(a)			25,932				1.60	(b)			28,233				2.70				21,630				2.91				20,740				3.18
Foreign offices			13,881				4.55				13,281				3.97				13,739				3.71				15,208				3.73				13,109				2.56				12,155				2.21
Total non-margin loans			41,766				4.43				39,831				0.01	(a)			39,671				2.33	(b)			43,441				3.06				34,739				2.78				32,895				2.82
Securities
U.S. government obligations			397				3.52				542				3.08				679				3.03				762				2.73				787				2.50				1,679				1.67
U.S. government agency obligations			10,613				4.78				10,433				4.29				10,894				4.33				11,438				4.29				12,063				3.71				14,748				3.74
Obligations of states and political subdivisions			681				7.64				654				5.74				701				7.44				941				7.73				767				6.71				710				6.92
Other securities			35,840				5.26				32,755				5.22				30,590				5.42				26,916				5.95				29,848				4.47				34,766				2.85
Trading securities			1,459				5.36				1,918				3.74				1,791				2.76				2,148				3.96				1,728				2.86				2,179				2.50
Total securities			48,990				5.18				46,302				4.93				44,655				5.04				42,205				5.38				45,193				4.22				54,082				3.10
Total interest-earning assets			142,863				4.55				142,032				3.02	(a)			142,062				3.69	(b)			181,639				3.36				167,427				2.37				157,265				2.16
Allowance for credit losses			(297	)							(295	)							(329	)							(334	)							(378	)							(426	)
Cash and due from banks			5,789								5,356								7,796								5,806								4,824								3,412
Other assets			49,782								46,504								46,937								54,499								45,880								45,975
Discontinued Operations			2,653								2,400								2,361								2,352								2,366								2,307
Total Asset Consol VIE FAS 167			—								—								—								—								—								—
Total Assets		$	200,790							$	195,997							$	198,827							$	243,962							$	220,119							$	208,533
Liabilities and total equity
Interest-bearing liabilities:
Money market rate accounts		$	12,577				1.67	%		$	12,869				0.98	%		$	11,785				0.88	%		$	18,274				0.53	%		$	18,563				0.10	%		$	19,037				0.10	%
Savings			902				1.89				971				1.50				979				0.93				1,013				0.64				1,165				0.61				1,070				0.44
Certificates of deposit of $100,000 & over			2,313				3.91				2,116				2.60				1,928				2.19				1,812				2.43				1,479				1.11				942				1.00
Other time deposits			8,300				2.45				6,335				1.88				5,393				1.99				5,052				1.34				5,574				0.55				4,190				0.48
Foreign offices			67,914				2.85				71,641				2.22				65,931				2.19				69,575				1.12				75,202				0.31				73,657				0.14
Total interest-bearing deposits			92,006				2.67				93,932				2.03				86,016				1.99				95,726				1.04				101,983				0.30				98,896				0.16
Federal funds purchased and securities under repurchase agreements			4,138				2.14				3,791				1.02				4,816				1.18				5,738				0.27				1,839				0.09				2,485				(0.46	)
Other borrowed funds			3,343				3.50				2,840				3.21				3,303				2.31				3,558				2.13				3,785				1.57				2,756				1.04
Borrowings from FRB Related to ABCP			—				—				—				—				954				2.25				8,378				2.25				1,269				2.25				—				—
Payables to customers and broker-dealers			4,942				1.94				5,550				1.32				5,910				1.19				5,570				0.62				3,797				0.20				4,901				0.13
Long-term debt			17,125				4.51				16,841				3.58				15,993				3.62				15,467				3.79				15,493				2.72				16,793				2.35
Total interest-bearing liabilities			121,554				2.91				122,954				2.21				116,992				2.15				134,437				1.41				128,166				0.64				125,831				0.46
Total noninterest-bearing deposits			25,726								24,300								32,953								51,729								43,051								32,852
Other liabilities			21,169								17,707								18,396								26,601								18,523								18,578
`			2,653								2,400								2,361								2,352								2,366								2,307
VIE Liabilities & Obligations FAS 167			—								—								—								—								—								—
Total Shareholders’ Equity			29,551								28,507								27,996								28,771								27,978								28,934
Noncontrolling interest			137								129								129								72								35								31
Total liabilities and shareholders’ equity		$	200,790							$	195,997							$	198,827							$	243,962							$	220,119							$	208,533
Net interest margin – Taxable equivalent basis							2.09	%							1.11	%							1.92	%							2.32	%							1.87	%							1.80	%
Net interest margin excluding the SILO/LILO charge – Non-GAAP															2.17	%							2.24	%

 

(a)	Excluding the SILO/LILO charge, the rates on Domestic office loans, Non-margin loans and Interest-earning assets were 3.71%, 3.80% and 4.08%, respectively.

 

(b)	Excluding the SILO/LILO charge, the rates on Domestic office loans, Non-margin loans and Interest-earning assets were 3.33%, 3.46% and 4.01%, respectively.

 

Note:

Interest and average rates were calculated on a taxable equivalent basis, at tax rates of approximately 35%, using dollar amounts in thousands and the actual number of days in the year.

 

Page 4 of 19

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THE BANK OF NEW YORK MELLON CORPORATION

CONTINUING OPERATIONS

Average Balances and Interest Rates (continued)

 

		Quarter Ended
		September 30, 2009								December 31, 2009								March 31, 2010								June 30, 2010								September 30, 2010								December 31, 2010
(dollar amounts in millions)		Average balance				Average rates				Average balance				Average rates				Average balance				Average rates				Average balance				Average rates				Average balance				Average rates				Average balance				Average rates
Assets
Interest-earning assets:
Interest-bearing deposits with banks (primarily foreign)		$	54,343				1.08	%		$	55,467				1.09	%		$	55,800				1.03	%		$	50,741				1.01	%		$	60,431				0.93	%		$	59,660				0.96	%
Interest-bearing deposits with Federal Reserve bank			6,976				0.32				11,430				0.32				12,129				0.33				18,280				0.34				9,813				0.40				16,787				0.32
Other Short Term Investment (FRB)			—				—				—				—				—				—				—				—				—				—				—				—
Federal funds sold and securities under resale agreements			3,443				1.19				4,276				0.65				3,859				0.71				4,652				0.66				4,559				0.46				5,553				3.15
Margin loans			4,335				1.55				4,665				1.55				5,241				1.49				5,786				1.49				6,269				1.47				6,289				1.55
Non-margin loans:
Domestic offices			19,412				3.22				20,212				2.89				19,510				3.12				20,750				2.89				21,110				2.74				21,780				2.55
Foreign offices			10,788				1.99				10,362				1.75				9,463				1.62				10,128				1.53				9,390				1.61				9,460				1.53
Total non-margin loans			30,200				2.78				30,574				2.51				28,973				2.63				30,878				2.45				30,500				2.39				31,240				2.24
Securities
U.S. government obligations			4,605				1.45				5,729				1.44				6,600				1.40				6,162				1.46				7,229				1.63				11,390				1.51
U.S. government agency obligations			17,635				3.79				19,530				3.59				19,429				3.58				19,629				3.48				20,074				3.29				21,406				2.95
Obligations of states and political subdivisions			639				7.30				607				7.35				670				6.37				638				6.56				615				6.43				587				6.53
Other securities			31,010				3.04				29,707				3.49				28,653				4.20				27,601				4.14				30,075				3.86				31,987				3.55
Trading securities			1,973				2.30				2,090				2.53				2,075				2.49				2,752				2.62				3,194				2.57				2,698				3.02
Total securities			55,862				3.16				57,663				3.32				57,427				3.63				56,782				3.58				61,187				3.36				68,068				3.02
Total interest-earning assets			155,159				2.14				164,075				2.09				163,429				2.18				167,119				2.08				172,759				2.03				187,597				1.95
Allowance for credit losses			(425	)							(448	)							(502	)							(517	)							(538	)							(530	)
Cash and due from banks			3,247								3,104								3,514								3,673								3,903								4,224
Other assets			45,728								45,481								45,346								46,266								50,007								50,220
Discontinued Operations			2,077								1,993								898								260								247								223
Total Asset Consol VIE FAS 167			—								—								12,730								12,040								13,947								14,675
Total Assets		$	205,786							$	214,205							$	225,415							$	228,841							$	240,325							$	256,409
Liabilities and total equity
Interest-bearing liabilities:
Money market rate accounts		$	16,817				0.09	%		$	20,062				0.08	%		$	21,741				0.09	%		$	24,279				0.10	%		$	25,696				0.11	%		$	30,149				0.10	%
Savings			1,115				0.32				1,196				0.49				1,372				0.27				1,389				0.27				1,389				0.26				1,433				0.22
Certificates of deposit of $100,000 & over			847				0.62				589				0.32				648				0.25				332				0.16				214				0.11				285				0.08
Other time deposits			5,058				0.40				4,872				0.43				5,224				0.30				5,902				0.26				6,210				0.23				5,149				0.31
Foreign offices			69,795				0.08				71,685				0.10				72,049				0.16				68,061				0.19				70,524				0.22				74,760				0.26
Total interest-bearing deposits			93,632				0.11				98,404				0.12				101,034				0.16				99,963				0.17				104,033				0.19				111,776				0.22
Federal funds purchased and securities under repurchase agreements			3,075				0.20				3,361				0.14				3,697				0.07				4,441				0.19				5,984				0.09				7,256				2.13
Other borrowed funds			2,286				1.49				2,618				1.86				2,805				1.97				4,223				2.08				4,029				1.66				3,703				1.36
Borrowings from FRB Related to ABCP			—				—				—				—				—				—				—				—				—				—				—				—
Payables to customers and broker-dealers			5,844				0.10				6,476				0.07				6,372				0.08				6,596				0.09				6,910				0.08				5,878				0.11
Long-term debt			17,393				1.74				17,863				1.89				16,808				1.50				16,462				1.75				16,798				2.04				16,624				1.87
Total interest-bearing liabilities			122,230				0.37				128,722				0.40				130,716				0.36				131,685				0.43				137,754				0.45				145,237				0.53
Total noninterest-bearing deposits			34,920								34,991								33,330								34,628								33,198								39,625
Other liabilities			18,386								19,633								18,420								20,042								23,770								24,740
Discontinued Operations			2,077								1,993								898								260								247								223
VIE Liabilities & Obligations FAS 167			—								—								11,540								11,046								12,778								13,481
Total Shareholders' Equity			28,144								28,843								29,715								30,434								31,868								32,379
Noncontrolling interest			29								23								796								746								710								724
Total liabilities and total equity		$	205,786							$	214,205							$	225,415							$	228,841							$	240,325							$	256,409
Net interest margin - Taxable equivalent basis							1.85	%							1.77	%							1.89	%							1.74	%							1.67	%							1.54	%
Net interest margin excluding the SILO/LILO charge - Non-GAAP

 

Note:

Interest and average rates were calculated on a taxable equivalent basis, at tax rates of approximately 35%, using dollar amounts in thousands and the actual number of days in the year.

 

Page 5 of 19

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THE BANK OF NEW YORK MELLON CORPORATION

CONTINUING OPERATIONS - 12 Quarter Trend

NONINTEREST EXPENSE

 

		2008																2009																2010
(dollar amounts in millions)		1st Qtr				2nd Qtr				3rd Qtr (a)				4th Qtr (a)				1st Qtr				2nd Qtr				3rd Qtr				4th Qtr				1st Qtr				2nd Qtr				3rd Qtr				4th Qtr
Staff:
Compensation		$	803			$	818			$	836			$	785			$	732			$	740			$	747			$	766			$	753			$	763			$	850			$	871
Incentives			365				385				241				256				247				241				242				266				284				272				289				348
Employee benefits			190				200				171				139				190				172				168				189				183				199				205				198
Total staff			1,358				1,403				1,248				1,180				1,169				1,153				1,157				1,221				1,220				1,234				1,344				1,417
Professional, legal and other purchased services			238				259				251				273				237				237				265				278				241				256				282				320
Software and Equipment			158				166				158				172				158				169				171				178				169				162				187				207
Net occupancy			128				138				163				141				139				142				142				141				137				143				150				158
Distribution and servicing			130				131				133				123				103				102				97				91				89				90				94				104
Sub-custodian			65				72				62				55				39				60				49				55				52				65				60				70
Business development			65				75				62				76				44				49				45				76				52				68				63				88
Other			215				227				1,013				448				202				233				232				226				186				201				249				260
Subtotal		$	2,357			$	2,471			$	3,090			$	2,468			$	2,091			$	2,145			$	2,158			$	2,266			$	2,146			$	2,219			$	2,429	(c)		$	2,624	(c)
Special Litigation Reserves			N/A				N/A				N/A				N/A				N/A				N/A				N/A				N/A				164				N/A				N/A				N/A
FDIC special assessment			—				—				—				—				—				61				—				—				—				—				—				—
Amortization of intangible assets			119				123				118				113				107				108				104				107				97				98				111				115
Restructuring charges			—				—				—				181				10				6				(5	)			139				7				(15	)			15				21
Merger & integration expense:
The Bank of New York Mellon Corporation			121				146				107				97				68				59				54				52				26				14				56				43
Acquired Corporate Trust Business			5				3				4				—				—				—				—				—				—				—				—				—
Total noninterest expense		$	2,602			$	2,743			$	3,319			$	2,859			$	2,276			$	2,379			$	2,311			$	2,564			$	2,440			$	2,316			$	2,611			$	2,803
Employees at period-end (b)			42,000				42,500				42,900				42,500				41,700				41,800				42,000				42,200				42,300				42,700				47,700				48,000

 

(a)	The third and fourth quarters of 2008 include support agreement charges of $726 million and $163 million, respectively.

 

(b)	Represents full time employees.

 

(c)	Noninterest expense from the GIS/BAS acquisitions was $185 million and $196 million in the third and fourth quarters of 2010, respectively.

 

Page 6 of 19

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THE BANK OF NEW YORK MELLON CORPORATION

ASSETS UNDER MANAGEMENT/ CUSTODY AND ADMINISTRATION / SECURITIES LENDING - 12 Quarter Trend

 

		2008																2009																2010
(dollar amounts in billions unless otherwise noted)		1st Qtr				2nd Qtr				3rd Qtr				4th Qtr				1st Qtr				2nd Qtr				3rd Qtr				4th Qtr				1st Qtr				2nd Qtr				3rd Qtr				4th Qtr
Market value of assets under management at period-end (in billions)
Institutional		$	636			$	625			$	585			$	445			$	394			$	425			$	461			$	611			$	620			$	595			$	639			$	639
Mutual Funds			373				393				384				400				413				421				421				416				396				370				418				454
Private Client			96				95				98				83				74				80				84				88				89				82				84				79
Total market value of assets under management			1,105				1,113				1,067				928				881				926				966				1,115				1,105				1,047				1,141				1,172
Composition of assets under management at period-end
Equity			40	%			38	%			36	%			29	%			27	%			31	%			34	%			31	%			32	%			30	%			31	%			32	%
Money Market			29	%			31	%			34	%			43	%			45	%			43	%			39	%			32	%			30	%			30	%			30	%			29	%
Fixed Income			18	%			18	%			20	%			18	%			19	%			17	%			17	%			21	%			21	%			23	%			22	%			21	%
Alternative investments and overlay			13	%			13	%			10	%			10	%			9	%			9	%			10	%			16	%			17	%			17	%			17	%			18	%
Total			100	%			100	%			100	%			100	%			100	%			100	%			100	%			100	%			100	%			100	%			100	%			100	%
Market value of assets under custody and administration at period-end (in trillions)		$	23.1			$	23.0			$	22.4			$	20.2			$	19.5			$	20.7			$	22.1			$	22.3			$	22.4			$	21.8			$	24.4			$	25.0
Market value of securities on loan at period-end		$	660			$	588			$	470			$	326			$	293			$	290			$	299			$	247			$	253			$	248			$	279			$	278
Market Indices
S&P 500 Index (a)			1323				1280				1166				903				798				919				1057				1115				1169				1031				1141				1258
S&P 500 Index - daily average			1353				1371				1252				916				809				891				995				1088				1123				1135				1095				1204
FTSE 100 Index (a)			5702				5626				4902				4434				3926				4249				5134				5413				5680				4917				5549				5900
FTSE 100 Index-daily average			5891				5979				5359				4270				4040				4258				4708				5235				5431				5361				5312				5760
NASDAQ Composite Index (a)			2279				2293				2092				1577				1529				1835				2122				2269				2398				2109				2369				2653
Lehman Brothers Aggregate Bond Index (a)			281				270				256				275				262				280				304				301				300				299				329				323
MSCI EAFE Index (a)			2039				1967				1553				1237				1056				1307				1553				1581				1584				1348				1561				1658
NYSE Volume (in billions)			159				141				180				181				161				151				126				112				103				140				104				98
NASDAQ Volume (in billions)			149				135				145				148				136				152				144				131				143				159				129				121

 

(a)	Period end

 

Page 7 of 19

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THE BANK OF NEW YORK MELLON CORPORATION

ASSETS UNDER MANAGEMENT NET FLOWS - 12 Quarter Trend

 

		2008																2009																2010
(dollar amounts in billions)		1st Qtr				2nd Qtr				3rd Qtr				4th Qtr				1st Qtr				2nd Qtr				3rd Qtr				4th Qtr				1st Qtr				2nd Qtr				3rd Qtr				4th Qtr
Market value of assets under management at beginning of period		$	1,121			$	1,105			$	1,113			$	1,067			$	928			$	881			$	926			$	966			$	1,115			$	1,105			$	1,047			$	1,141
Net Flows
Long-term			(6	)			(8	)			(6	)			(22	)			(1	)			(17	)			(2	)			14				16				12				11				9
Money market			29				21				14				28				(11	)			(2	)			(14	)			(22	)			(25	)			(17	)			18				6
Total net inflows			23				13				8				6				(12	)			(19	)			(16	)			(8	)			(9	)			(5	)			29				15
Net Market appreciation/(depreciation)			(39	)			(6	)			(54	)			(137	)			(35	)			64				56				10				(1	)			(53	)			65				16
Acquisitions/other			—				1				—				(8	)			—				—				—				147	(a)			—				—				—				—
Market value of assets under management at end of period		$	1,105			$	1,113			$	1,067			$	928			$	881			$	926			$	966			$	1,115			$	1,105			$	1,047			$	1,141			$	1,172

 

(a)	Represents acquisitions of Insight ($139 billion) and 20% interest in Siguler Guff ($8 billion).

 

Page 8 of 19

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THE BANK OF NEW YORK MELLON CORPORATION

BUSINESSES

ASSET MANAGEMENT - 12 Quarter Trend

 

		2008																2009																2010
(dollar amounts in millions unless otherwise noted)		1st Qtr				2nd Qtr				3rd Qtr				4th Qtr				1st Qtr				2nd Qtr				3rd Qtr				4th Qtr (a)				1st Qtr (a), (b)				2nd Qtr (a), (b)				3rd Qtr (a), (b)				4th Qtr (a), (b)
Revenue:
Asset and wealth management
Mutual funds			323				340				328				297				267				271				283				277				249				254				270				293
Institutional clients			304				290				265				193				183				178				202				226				265				262				264				283
Private clients			45				47				43				35				32				31				34				38				38				37				38				38
Performance fees			20				16				3				44				7				26				1				59				13				19				16				75
Total asset and wealth management			692				693				639				569				489				506				520				600				565				572				588				689
Distribution and servicing			86				99				93				93				82				78				63				56				47				49				52				53
Other fee revenue (c)			(27	)			4				(47	)			(100	)			(96	)			(59	)			2				6				17				—				9				3
Total fee and other revenue			751				796				685				562				475				525				585				662				629				621				649				745
Net interest revenue (expense)			12				9				9				45				15				7				7				3				—				1				(2	)			—
Total revenue			763				805				694				607				490				532				592				665				629				622				647				745
Noninterest expenses (ex. intangible amortization and support agreement charges)			557				528				488				478				408				415				408				447				433				458				458				513
Income before taxes (ex. intangible amortization and support agreement charges)			206				277				206				129				82				117				184				218				196				164				189				232
Support agreement charges			—				5				328				2				(14	)			—				32				—				—				(7	)			26				—
Amortization of intangible assets			62				68				64				61				55				55				53				56				50				50				50				51
Income before taxes			144				204				(186	)			66				41				62				99				162				146				121				113				181
Average assets		$	13,238			$	13,410			$	13,286			$	13,135			$	12,663			$	12,404			$	12,424			$	12,859			$	25,187			$	24,895			$	27,389			$	28,604
Market value of assets under management at period-end (in billions) (d)		$	1,029			$	1,040			$	995			$	862			$	818			$	860			$	897			$	1,045			$	1,034			$	980			$	1,071			$	1,107
Pre-tax operating margin
GAAP			19	%			25	%			-27	%			11	%			8	%			12	%			17	%			24	%			23	%			19	%			17	%			24	%
Non-GAAP (ex. intangible amortization) (e)			27	%			34	%			-18	%			21	%			19	%			22	%			26	%			33	%			31	%			27	%			25	%			31	%

 

(a)	Insight Investment Management acquisition closed November 2, 2009.

 

(b)

Total fee and other revenue for the first, second, third and fourth quarters of 2010 includes income from consolidated asset management funds of $65 million, $65 million, $37 million and $59 million, respectively, and net income attributable to noncontrolling interest of $24 million, $33 million, ($12) million and $14 million, respectively. The net of these income statement line items is included above in institutional client revenue of $25 million, $29 million, $36 million and $33 million respectively, and other revenue of $16 million, $3 million, $13 million and $10 million, respectively, and performance fees of $2 million for the fourth quarter.

 

(c)	Includes investment write-downs of $24 million and $51 million in the first and fourth quarters of 2008; $34 million and $45 million in the first and second quarters of 2009.

 

(d)	Includes amounts subadvised for/by other businesses.

 

(e)

Excluding support agreement charges, securities gains/losses and intangible amortization, pre-tax operating margin (Non-GAAP) was 29%, 35%, 30% and 27% for the first, second, third and fourth quarters of 2008, respectively; and 22%, 28%, 31% and 33% for the first, second, third and fourth quarters of 2009, respectively; and 31%, 26%, 29% and 31% for the first, second, third and fourth quarters of 2010, respectively.

 

Page 9 of 19

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THE BANK OF NEW YORK MELLON CORPORATION

BUSINESSES

WEALTH MANAGEMENT - 12 Quarter Trend

 

		2008																2009																2010
(dollar amounts in millions unless otherwise noted)		1st Qtr				2nd Qtr				3rd Qtr				4th Qtr				1st Qtr				2nd Qtr				3rd Qtr				4th Qtr				1st Qtr				2nd Qtr				3rd Qtr				4th Qtr
Revenue:
Asset and wealth management			153				150				141				119				122				128				133				136				136				134				133				137
Other fee revenue			13				11				22				15				19				12				13				15				10				13				11				16
Total fee and other revenue			166				161				163				134				141				140				146				151				146				147				144				153
Net interest revenue (expense)			46				48				50				56				50				49				49				46				55				56				58				58
Total revenue			212				209				213				190				191				189				195				197				201				203				202				211
Provision for credit losses			—				(1	)			1				—				—				—				—				1				—				—				—				2
Noninterest expenses (ex. intangible amortization and support agreement charges)			142				143				142				143				129				136				135				138				136				145				140				154
Income before taxes (ex. intangible amortization and support agreement charges)			70				67				70				47				62				53				60				58				65				58				62				55
Support agreement charges			—				—				15				—				—				—				—				—				—				—				—				—
Amortization of intangible assets			13				13				14				14				11				11				12				11				9				9				9				9
Income before taxes			57				54				41				33				51				42				48				47				56				49				53				46
Average loans		$	4,390			$	4,816			$	5,231			$	5,309			$	5,388			$	5,684			$	6,010			$	6,191			$	6,302			$	6,350			$	6,503			$	6,644
Average assets		$	10,496			$	10,254			$	9,801			$	9,632			$	9,611			$	9,131			$	9,122			$	9,246			$	9,722			$	10,399			$	10,806			$	11,523
Average deposits		$	7,993			$	7,782			$	7,318			$	7,131			$	7,058			$	6,628			$	6,602			$	6,804			$	7,310			$	7,991			$	8,416			$	9,094
Market value of total client assets under management and custody at period-end (in billions)		$	164			$	162			$	158			$	139			$	132			$	142			$	151			$	154			$	157			$	150			$	161			$	166
Assets under management (a)		$	84			$	81			$	77			$	69			$	66			$	69			$	74			$	75			$	76			$	71			$	75			$	77
Pre-tax operating margin
GAAP			27	%			26	%			20	%			18	%			27	%			22	%			25	%			24	%			28	%			24	%			26	%			22	%
Non-GAAP adjusted (excluding intangible amortization)			33	%			32	%			26	%(b)			25	%			32	%			28	%			31	%			29	%			32	%			28	%			31	%			26	%

 

(a)	Includes amounts subadvised by/for other businesses.

 

(b)	Excluding support agreement charges, pre-tax operating margin (Non-GAAP) was 34% for the third quarter of 2008.

 

Note:

On June 3, 2008, we completed the sale of Mellon 1st Business Bank, National Association (N.A.); the financial results have been moved from the Wealth Management business to the Other business. Historical business results have been restated to reflect these changes.

 

Page 10 of 19

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THE BANK OF NEW YORK MELLON CORPORATION

BUSINESSES

ASSET SERVICING - 12 Quarter Trend

 

		2008																2009																2010
(dollar amounts in millions unless otherwise noted)		1st Qtr				2nd Qtr				3rd Qtr				4th Qtr				1st Qtr				2nd Qtr				3rd Qtr				4th Qtr				1st Qtr				2nd Qtr				3rd Qtr				4th Qtr
Revenue:
Securities servicing fees - ex. securities lending (a)			634				648				631				583				504				557				573				581				569				586				802				847
Securities lending revenue			229				182				143				163				79				85				32				25				24				30				26				26
Foreign Exchange and other trading activities			202				228				262				372				210				216				190				177				170				207				135				181
Other fee revenue			44				36				47				25				48				46				50				33				35				83				42				46
Total fee and other revenue			1,109				1,094				1,083				1,143				841				904				845				816				798				906				1,005				1,100
Net interest revenue (expense)			222				213				240				411				249				211				229				205				210				216				216				222
Total revenue			1,331				1,307				1,323				1,554				1,090				1,115				1,074				1,021				1,008				1,122				1,221				1,322
Noninterest expenses (ex. intangible amortization and support agreement charges)			733				826				825				835				704				721				748				788				740				765				907				966
Income before taxes (ex. intangible amortization and support agreement charges)			598				481				498				719				386				394				326				233				268				357				314				356
Support agreement charges			14				(14	)			381				160				6				(15	)			(19	)			(5	)			(23	)			16				(11	)			(8	)
Amortization of intangible assets			7				5				6				6				7				9				6				6				6				5				18				18
Income before taxes			577				490				111				553				373				400				339				232				285				336				307				346
Average loans (a)		$	8,967			$	7,284			$	8,538			$	10,376			$	5,743			$	4,744			$	3,727			$	3,962			$	3,378			$	4,683			$	4,763			$	5,659
Average assets		$	52,468			$	54,763			$	57,795			$	71,455			$	65,204			$	58,339			$	59,914			$	59,980			$	59,704			$	62,940			$	69,026			$	74,849
Average deposits		$	46,092			$	48,436			$	51,492			$	64,500			$	57,084			$	50,583			$	52,271			$	51,755			$	52,183			$	55,343			$	57,849			$	61,789
Pre-tax operating margin
GAAP			43	%			37	%			8	%			36	%			34	%			36	%			32	%			23	%			28	%			30	%			25	%			26	%
Non-GAAP adjusted (excluding intangible amortization)			43	%			38	%			9	%(c)			36	%(c)			35	%			37	%			32	%			23	%			29	%			30	%			27	%			28	%
MEMO:
Market value of securities on loan at period-end (in billions) (b)		$	660			$	588			$	470			$	326			$	293			$	290			$	299			$	247			$	253			$	248			$	279			$	278

 

(a)	Loan balances are primarily related to Broker-Dealer Services business within Asset Servicing.

 

(b)	Represents the total amount of securities on loan (both cash and non-cash) managed by the Asset Servicing business.

 

(c)	Excluding support agreement charges, pre-tax operating margin (Non-GAAP) was 38% in the third quarter of 2008 and 46% in the fourth quarter of 2008.

 

Page 11 of 19

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THE BANK OF NEW YORK MELLON CORPORATION

BUSINESSES

ISSUER SERVICES - 12 Quarter Trend

 

		2008																2009																2010
(dollar amounts in millions unless otherwise noted)		1st Qtr				2nd Qtr				3rd Qtr				4th Qtr				1st Qtr				2nd Qtr				3rd Qtr				4th Qtr				1st Qtr				2nd Qtr				3rd Qtr				4th Qtr
Revenue:
Securities servicing fees - Issuer services			374				443				475				392				363				373				359				367				333				353				364				409
Other fee revenue			35				38				56				46				42				40				30				43				25				27				35				30
Total fee and other revenue			409				481				531				438				405				413				389				410				358				380				399				439
Net interest revenue (expense)			153				176				170				211				200				185				180				203				252				216				204				231
Total revenue			562				657				701				649				605				598				569				613				610				596				603				670
Provision for credit losses			—				—				—				—				—				—				—				—				—				—				—				—
Noninterest expenses (ex. intangible amortization)			318				349				349				319				297				305				304				318				304				318				304				345
Income before taxes (ex. intangible amortization)			244				308				352				330				308				293				265				295				306				278				299				325
Amortization of intangible assets			20				20				21				20				21				20				20				20				20				21				21				21
Income before taxes			224				288				331				310				287				273				245				275				286				257				278				304
Average assets		$	32,227			$	35,167			$	34,264			$	38,987			$	50,864			$	52,161			$	47,975			$	52,028			$	52,838			$	48,938			$	48,451			$	56,264
Average deposits		$	27,632			$	30,557			$	29,546			$	34,294			$	45,963			$	47,293			$	43,183			$	47,320			$	48,470			$	44,560			$	44,085			$	51,760
Pre-tax operating margin
GAAP			40	%			44	%			47	%			48	%			48	%			46	%			43	%			45	%			47	%			43	%			46	%			45	%
Non-GAAP adjusted (excluding intangible amortization)			43	%			47	%			50	%			51	%			51	%			49	%			47	%			48	%			50	%			47	%			50	%			48	%

 

Page 12 of 19

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THE BANK OF NEW YORK MELLON CORPORATION

BUSINESSES

CLEARING SERVICES - 12 Quarter Trend

 

		2008																2009																2010
(dollar amounts in millions unless otherwise noted)		1st Qtr				2nd Qtr				3rd Qtr				4th Qtr				1st Qtr				2nd Qtr				3rd Qtr				4th Qtr				1st Qtr				2nd Qtr				3rd Qtr				4th Qtr
Revenue:
Securities servicing fees - Clearing services			250				259				254				277				249				248				232				219				227				240				251				275
Other fee revenue			53				64				63				72				72				66				59				45				44				36				42				37
Total fee and other revenue			303				323				317				349				321				314				291				264				271				276				293				312
Net interest revenue (expense)			75				75				75				96				82				87				81				90				95				93				90				90
Total revenue			378				398				392				445				403				401				372				354				366				369				383				402
Provision for credit losses			—				—				—				—				—				—				—				—				—				—				—				—
Noninterest expenses (ex. intangible amortization)			263				291				282				268				252				256				245				241				255				270				279				305
Income before taxes (ex. intangible amortization)			115				107				110				177				151				145				127				113				111				99				104				97
Amortization of intangible assets			6				6				8				6				7				7				6				7				6				7				8				8
Income before taxes			109				101				102				171				144				138				121				106				105				92				96				89
Average loans		$	6,629			$	7,263			$	7,384			$	6,735			$	5,927			$	5,918			$	6,058			$	6,847			$	7,622			$	8,448			$	9,112			$	9,168
Average assets		$	16,408			$	17,395			$	18,471			$	21,128			$	18,600			$	17,014			$	17,827			$	20,365			$	20,338			$	21,550			$	21,456			$	22,081
Pre-tax operating margin
GAAP			29	%			25	%			26	%			38	%			36	%			34	%			33	%			30	%			29	%			25	%			25	%			22	%
Non-GAAP adjusted (excluding intangible amortization)			30	%			27	%			28	%			40	%			38	%			36	%			34	%			32	%			30	%			27	%			27	%			24	%

 

Note:

During the first quarter of 2009, we moved the financial results of the Execution business from the Clearing Services business to the Other business. Historical results have been restated to reflect these changes.

 

Page 13 of 19

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THE BANK OF NEW YORK MELLON CORPORATION

BUSINESSES

TREASURY SERVICES - 12 Quarter Trend

 

		2008																2009																2010
(dollar amounts in millions unless otherwise noted)		1st Qtr				2nd Qtr				3rd Qtr				4th Qtr				1st Qtr				2nd Qtr				3rd Qtr				4th Qtr				1st Qtr				2nd Qtr				3rd Qtr				4th Qtr
Revenue:
Treasury services			121				125				125				129				121				128				124				130				127				121				127				125
Other fee revenue			103				125				135				93				106				52				82				92				98				75				87				81
Total fee and other revenue			224				250				260				222				227				180				206				222				225				196				214				206
Net interest revenue (expense)			185				155				159				231				159				157				149				148				176				161				148				147
Total revenue			409				405				419				453				386				337				355				370				401				357				362				353
Provision for credit losses			—				—				—				—				—				—				—				—				—				—				—				—
Noninterest expenses (ex. intangible amortization)			203				200				201				200				189				191				180				187				182				188				188				188
Income before taxes (ex. intangible amortization)			206				205				218				253				197				146				175				183				219				169				174				165
Amortization of intangible assets			7				7				6				7				6				7				6				6				6				5				6				6
Income before taxes			199				198				212				246				191				139				169				177				213				164				168				159
Average loans		$	15,690			$	15,938			$	14,995			$	16,353			$	13,921			$	13,228			$	11,648			$	10,982			$	10,436			$	10,290			$	9,885			$	9,450
Average assets		$	24,153			$	21,227			$	22,384			$	34,585			$	28,665			$	24,764			$	24,223			$	26,275			$	26,716			$	26,485			$	25,748			$	27,129
Average deposits		$	20,056			$	17,316			$	18,397			$	30,052			$	24,867			$	20,321			$	19,989			$	22,138			$	22,257			$	22,209			$	21,912			$	23,235
Pre-tax operating margin
GAAP			49	%			49	%			51	%			54	%			50	%			41	%			48	%			48	%			53	%			46	%			47	%			45	%
Non-GAAP adjusted (excluding intangible amortization)			50	%			51	%			52	%			56	%			51	%			43	%			50	%			50	%			55	%			47	%			48	%			47	%

 

Page 14 of 19

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THE BANK OF NEW YORK MELLON CORPORATION

BUSINESSES

OTHER - 12 Quarter Trend

 

		2008																2009																2010
(dollar amounts in millions unless otherwise noted)		1st Qtr				2nd Qtr (b)				3rd Qtr (b)				4th Qtr (c)				1st Qtr				2nd Qtr				3rd Qtr				4th Qtr (c)				1st Qtr (d)				2nd Qtr				3rd Qtr				4th Qtr
Revenue:
Total fee and other revenue (a)			20				(116	)			(113	)			(1,031	)			(278	)			(223	)			(4,685	)			52				143				61				13				62
Net interest revenue (expense)			50				(288	)			(22	)			(3	)			20				4				21				29				(23	)			(21	)			4				(28	)
Total revenue			70				(404	)			(135	)			(1,034	)			(258	)			(219	)			(4,664	)			81				120				40				17				34
Provision for credit losses			14				14				22				54				59				61				147				64				35				20				(22	)			(24	)
Noninterest expenses (ex. FDIC special assessment, special litigation reserves, intangible amortization, M&I expenses and restructuring charges)			127				143				79				63				120				136				125				152				119				66				138				161
Income before taxes and extraordinary (loss) (ex. FDIC special assessment, special litigation reserves, intangible amortization, M&I expenses and restructuring charges)			(71	)			(561	)			(236	)			(1,151	)			(437	)			(416	)			(4,936	)			(135	)			(34	)			(46	)			(99	)			(103	)
Amortization of intangible assets			4				4				(1	)			(1	)			—				(1	)			1				1				—				1				(1	)			2
Special Litigation Reserves			N/A				N/A				N/A				N/A				N/A				N/A				N/A				N/A				164				N/A				N/A				N/A
FDIC special assessment			—				—				—				—				—				61				—				—				—				—				—				—
Restructuring			—				—				—				181				10				6				(5	)			139				7				(15	)			15				21
Merger & integration expenses			126				149				111				97				68				59				54				52				26				14				56				43
Income before taxes and extraordinary (loss)			(201	)			(714	)			(346	)			(1,428	)			(515	)			(541	)			(4,986	)			(327	)			(231	)			(46	)			(169	)			(169	)
Average loans		$	11,348			$	10,332			$	9,287			$	9,553			$	7,979			$	7,455			$	7,092			$	7,257			$	6,476			$	6,893			$	6,489			$	6,584
Average assets		$	49,147			$	41,381			$	40,465			$	52,688			$	32,146			$	32,413			$	32,224			$	31,459			$	30,012			$	33,374			$	37,202			$	35,736
Average deposits		$	15,959			$	14,141			$	12,216			$	11,478			$	10,062			$	6,923			$	6,507			$	5,378			$	4,144			$	4,488			$	4,969			$	5,523

 

(a)	Total fee and other revenue includes investment write-downs of $51 million, $151 million, $156 million and $1,176 million for the first, second, third and fourth quarters of 2008; $316 million, $209 million and $4.8 billion in the first, second and third quarters of 2009.

 

(b)	The second and third quarter of 2008 include SILO/LILO charges which reduced net interest revenue by $377 million and $112 million, respectively.

 

(c)	The fourth quarter of 2008 and the fourth quarter of 2009 includes a pretax global efficiency restructuring charge of $181 million and $139 million, respectively.

 

(d)	The first quarter of 2010 includes a $164 million pretax charge related to special litigation reserves.

 

Notes:

The Other business primarily includes the results of leasing operations, corporate treasury activities, business exits and corporate overhead.

 

On June 3, 2008, we completed the sale of Mellon 1st Business Bank, National Association (N.A.); the financial results have been moved from the Wealth Management business to the Other business. During the first quarter of 2009, the financial results of the Execution business have been moved from the Clearing Services business to the Other business. On June 30, 2009, we adopted discontinued operations accounting for Mellon United National Bank (MUNB) located in Miami, Florida; previously, the financial results were included in the Other business. On January 15, 2010, we completed the sale of MUNB. Historical business results have been restated to reflect all of these changes.

 

Page 15 of 19

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THE BANK OF NEW YORK MELLON CORPORATION

BUSINESSES

 

		Asset Management												Wealth Management												Asset Servicing												Issuer Services
(dollar amounts in millions unless otherwise noted)		2010				2009				2008				2010				2009				2008				2010				2009				2008				2010				2009				2008
Revenue:
Securities servicing fees
Asset servicing			92				86				124				30				27				27				2,910				2,436				3,213				1				1				23
Issuer services			—				—				—				—				—				—				1				1				1				1,459				1,462				1,684
Clearing services			12				12				14				—				—				—				—				—				—				—				—				—
Total securities servicing fees			104				98				138				30				27				27				2,911				2,437				3,214				1,460				1,463				1,707
Asset and wealth management			2,291				2,022				2,510				540				519				563				—				—				—				1				1				—
Performance fees			123				93				83				—				—				—				—				—				—				—				—				—
Foreign exchange & other trading			18				20				20				7				7				14				693				793				1,064				68				85				80
Treasury services			—				—				—				3				3				3				12				10				8				2				2				1
Distribution and service fees			201				279				371				—				1				4				8				9				10				—				—				—
Financing-related fees			1				6				10				6				3				4				12				11				14				6				—				—
Investment and Other Income			(103	)			(193	)			(260	)			1				15				9				173				146				130				39				66				71
Total fee revenue			2,635				2,325				2,872				587				575				624				3,809				3,406				4,440				1,576				1,617				1,859
Securities gains (losses)			9				(78	)			(78	)			3				3				—				—				—				(11	)			—				—				—
Total fee and other revenue			2,644				2,247				2,794				590				578				624				3,809				3,406				4,429				1,576				1,617				1,859
Net interest revenue (expense)			(1	)			32				75				227				194				200				864				894				1,086				903				768				710
Total revenue			2,643				2,279				2,869				817				772				824				4,673				4,300				5,515				2,479				2,385				2,569
Provision for credit losses			—				—				—				2				1				—				—				—				—				—				—				—
Noninterest expenses (ex. M&I expenses and intangible amortization)			1,881				1,696				2,386				575				538				585				3,352				2,928				3,760				1,271				1,224				1,335
Income before taxes and extraordinary (loss) (ex. M&I expenses and intangible amortization)			762				583				483				240				233				239				1,321				1,372				1,755				1,208				1,161				1,234
Amortization of intangible assets			201				219				255				36				45				54				47				28				24				83				81				81
Merger & integration expense			—				—				—				—				—				—				—				—				—				—				—				—
Income before taxes, noncontrolling interest and extraordinary (loss)			561				364				228				204				188				185				1,274				1,344				1,731				1,125				1,080				1,153
Average loans		$	10			$	—			$	—			$	6,451			$	5,821			$	4,938			$	4,627			$	4,537			$	8,795			$	—			$	—			$	—
Average assets		$	26,531			$	12,564			$	13,267			$	10,618			$	9,276			$	10,044			$	66,678			$	60,842			$	59,150			$	51,623			$	50,752			$	35,169
Average deposits		$	—			$	—			$	—			$	8,208			$	6,772			$	7,554			$	56,820			$	52,907			$	52,659			$	47,219			$	45,936			$	30,515
Market value of assets under management at period-end (in billions)		$	1,107			$	1,045			$	862			$	65			$	70			$	66			$	—			$	—			$	—			$	—			$	—			$	—
Market value of assets under custody and administration at period-end (in billions)		$	—			$	6			$	3			$	88			$	80			$	70			$	24,940			$	22,171			$	20,086			$	—			$	—			$	—
Market value of securities on loan at period-end (in billions)		$	—			$	—			$	—			$	—			$	—			$	—			$	—			$	247			$	326			$	—			$	—			$	—
Pre-tax operating margin - GAAP			21	%			16	%			8	%			25	%			24	%			23	%			27	%			31	%			31	%			45	%			45	%			45	%
Pre-tax operating margin (ex. intangible amortization) - Non-GAAP			29	%			26	%			17	%			29	%			30	%			29	%			28	%			32	%			32	%			49	%			49	%			48	%
Pre-tax operating margin - Non-GAAP (a)			30	%			30	%			30	%			29	%			31	%			30	%			28	%			42	%			42	%			49	%			48	%			48	%

 

(a)	Excludes M&I expenses, SILO/LILO, tax settlements, support agreement charges, restructuring charges, special litigation, investment write-downs and intangible amortization expense.

 

Note:

See pages 9-15 for details of revenue/expense items impacting respective business results.

 

Page 16 of 19

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THE BANK OF NEW YORK MELLON CORPORATION

BUSINESSES

 

		Clearing Services												Treasury Services												Other												Consolidated Results
(dollar amounts in millions unless otherwise noted)		2010				2009				2008				2010				2009				2008				2010				2009				2008				2010 (b)				2009				2008
Revenue:
Securities servicing fees
Asset servicing			—				—				—				57				24				6				(1	)			(1	)			(23	)			3,089				2,573				3,370
Issuer services			—				—				—				—				—				—				—				—				—				1,460				1,463				1,685
Clearing services			993				948				1,040				—				—				—				—				2				11				1,005				962				1,065
Total securities servicing fees			993				948				1,040				57				24				6				(1	)			1				(12	)			5,554				4,998				6,120
Asset and wealth management			35				29				41				—				—				—				3				13				21				2,870				2,584				3,135
Performance fees			—				—				—				—				—				—				—				—				—				123				93				83
Foreign exchange & other trading			78				134				108				54				7				232				(32	)			(10	)			(56	)			886				1,036				1,462
Treasury services			—				—				—				500				503				500				—				1				2				517				519				514
Distribution and service fees			—				—				—				—				45				41				1				(8	)			(5	)			210				326				421
Financing-related fees			2				1				2				167				196				160				1				(2	)			(4	)			195				215				186
Investment Income and other			44				78				101				63				62				20				292				163				350				509				337				421
Total fee revenue			1,152				1,190				1,292				841				837				959				264				158				296				10,864				10,108				12,342
Securities gains (losses)			—				—				—				—				(2	)			(3	)			15				(5,292	)			(1,536	)			27				(5,369	)			(1,628	)
Total fee and other revenue			1,152				1,190				1,292				841				835				956				279				(5,134	)			(1,240	)			10,891				4,739				10,714
Net interest revenue (expense)			368				340				321				632				613				730				(68	)			74				(263	)			2,925				2,915				2,859
Total revenue			1,520				1,530				1,613				1,473				1,448				1,686				211				(5,060	)			(1,503	)			13,816				7,654				13,573
Provision for credit losses			—				—				—				—				—				—				9				331				104				11				332				104
Noninterest expenses (ex. M&I expenses and intangible amortization)			1,109				994				1,104				746				747				804				676				744				593				9,610				8,871				10,567
Income before taxes and extraordinary (loss) (ex. M&I expenses and intangible amortization)			411				536				509				727				701				882				(474	)			(6,135	)			(2,200	)			4,195				(1,549	)			2,902
Amortization of intangible assets			29				27				26				23				25				27				2				1				6				421				426				473
Merger & integration expense			—				—				—				—				—				—				139				233				483				139				233				483
Income before taxes, noncontrolling interest and extraordinary (loss)			382				509				483				704				676				855				(615	)			(6,369	)			(2,689	)			3,635				(2,208	)			1,946
Average loans		$	8,593			$	6,190			$	7,003			$	10,012			$	12,434			$	15,744			$	6,612			$	7,442			$	10,126			$	36,305			$	36,424			$	46,606
Average assets		$	21,361			$	18,455			$	18,358			$	26,519			$	25,971			$	25,603			$	34,291			$	32,079			$	45,925			$	237,621			$	209,939			$	207,516
Average deposits		$	—			$	—			$	—			$	22,405			$	21,816			$	21,470			$	4,689			$	7,221			$	13,441			$	139,341			$	134,652			$	125,639
Market value of assets under management at period-end (in billions)		$	—			$	—			$	—			$	—			$	—			$	—			$	—			$	—			$	—			$	1,172			$	1,115			$	928
Market value of assets under custody and administration at period-end (in billions)		$	—			$	—			$	—			$	—			$	—			$	—			$	—			$	—			$	—			$	25,028			$	22,257			$	20,159
Market value of securities on loan at period-end (in billions)		$	—			$	—			$	—			$	—			$	—			$	—			$	—			$	—			$	—			$	—			$	247			$	326
Pre-tax operating margin - GAAP			25	%			33	%			30	%			48	%			47	%			51	%			n/m				n/m				179	%			26	%			n/m				14	%
Pre-tax operating margin (ex. intangible amortization) - Non-GAAP			27	%			35	%			32	%			49	%			48	%			52	%			n/m				n/m				179	%			29	%			n/m				18	%
Pre-tax operating margin - Non-GAAP (a)			27	%			32	%			32	%			49	%			52	%			52	%			n/m				n/m				n/m				32	%			31	%			39	%
MEMO:
Securities lending revenue																																							150				259				789

 

(a)	Excludes M&I expenses, SILO/LILO, tax settlements, support agreement charges, restructuring charges, special litigation, investment write-downs and intangible amortization expense.

 

(b)

Total fee and other revenue and income before taxes for the year 2010 included income from consolidated asset management funds of $226 million net a loss attributable to noncontrolling interests of $59 million. The net of these income statement line items of $167 million is included above in fee and other revenue.

 

Note:

See pages 9-15 for details of revenue/expense items impacting respective business results.

n/m - not meaningful

 

Page 17 of 19

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THE BANK OF NEW YORK MELLON CORPORATION

CONTINUING OPERATIONS - 12 Quarter Trend

NONPERFORMING ASSETS

 

		2008																2009																2010
(dollar amounts in millions)		1st Qtr				2nd Qtr				3rd Qtr				4th Qtr				1st Qtr				2nd Qtr				3rd Qtr				4th Qtr				1st Qtr				2nd Qtr				3rd Qtr				4th Qtr
Loans:
Commercial real estate		$	49			$	106			$	118			$	130			$	197			$	63			$	63			$	61			$	50			$	49			$	39			$	44
Financial Institutions		$	—				—				—				41				30				39				180				172				102				20				16				12
Other residential mortgages			33				55				75				97				143				163				183				190				204				229				238				244
Commercial			50				52				65				14				34				43				71				65				40				40				35				34
Wealth Management			—				—				—				2				6				63				58				58				58				62				66				59
Foreign			78				60				1				—				2				1				—				—				—				—				—				—
Lease finance assets			—				—				—				—				—				—				—				—				—				—				—				—
Total nonperforming loans			210				273				259				284				412				372				555				546				454				400				394				393
Other assets owned			5				6				8				8				9				6				5				4				5				6				7				6
Total acquired property			—				—				—				—				—				—				—				—				—				—				—				—
Total nonperforming assets (a)		$	215			$	279			$	267			$	292			$	421			$	378			$	560			$	550			$	459			$	406			$	401			$	399
Nonperforming assets ratio			0.4	%			0.6	%			0.5	%			0.7	%			1.0	%			1.0	%			1.5	%			1.5	%			1.4	%			1.1	%			1.1	%			1.1	%
Allowance for loan losses/nonperforming loans			149.5				129.3				140.9				146.1				114.1				116.7				82.2				92.1				114.5				135.5				135.5				126.7
Allowance for loan losses/nonperforming assets			146.0				126.5				136.7				142.1				111.6				114.8				81.4				91.5				113.3				133.5				133.2				124.8
Total allowance for credit losses/nonperforming loans			231.9				178.0				190.7				186.3				135.7				141.4				107.4				115.0				140.5				161.3				154.3				145.3
Total allowance for credit losses/nonperforming assets			226.5				174.2				185.0				181.2				132.8				139.2				106.4				114.2				139.0				158.9				151.6				143.1

 

(a)	Nonperforming assets for all periods prior to June 30, 2009 include discontinued operations.

 

Note: The adoption of ASC 810 resulted in BNY Mellon consolidating loans of consolidated asset management funds of $11.3 billion at March 31, 2010, $12.1 billion at June 30, 2010, $13.3 billion at Sept. 30, 2010 and $13.8 billion at Dec. 2010 into trading assets. These loans are not part of BNY Mellon's loan portfolio. Included in these loans are $150 million, $131 million, $231 million and $218 million of nonperforming loans, respectively. These loans are recorded at fair value and therefore do not impact the provision for credit losses and allowance for loan losses, and accordingly are excluded from the nonperforming assets table above.

 

Page 18 of 19

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THE BANK OF NEW YORK MELLON CORPORATION

CONTINUING OPERATIONS - 12 Quarter Trend

ALLOWANCE FOR CREDIT LOSSES, PROVISION AND NET CHARGE-OFFS

 

		2008																2009																2010
(dollar amounts in millions)		1st Qtr				2nd Qtr				3rd Qtr				4th Qtr				1st Qtr				2nd Qtr				3rd Qtr				4th Qtr				1st Qtr				2nd Qtr				3rd Qtr				4th Qtr
Allowance for credit losses:
Allowance for loan losses		$	327			$	314			$	353			$	365			$	415			$	470			$	434			$	456			$	503			$	520			$	542			$	534
Allowance for lending-related commitments			167				173				133				129				114				89				92				140				125				118				103				74
Allowance at beginning of period			494				487				486				494				529				559				526				596				628				638				645				608
Net (charge-offs)/recoveries
Charge-offs			(14	)			(14	)			(27	)			(27	)			(51	)			(54	)			(77	)			(33	)			(37	)			(14	)			(17	)			(17	)
Recoveries			1				1				5				2				1				—				—				—				12				1				2				2
Total Net (charge-offs)/recoveries			(13	)			(13	)			(22	)			(25	)			(50	)			(54	)			(77	)			(33	)			(25	)			(13	)			(15	)			(15	)
Provision for credit losses (a)			16				25				30				60				59				61				147				65				35				20				(22	)			(22	)
Impact of Merger			—				—				—				—				—				—				—				—				—				—				—				—
Transfer to Discontinued Operations			—				—				—				—				21				(40	)			—				—				—				—				—				—
Sale of Mellon 1st Business Bank			—				(13	)			—				—				—				—				—				—				—				—				—				—
SFAS 159 Adoption			(10	)			—				—				—				—				—				—				—				—				—				—				—
Allowance at end of period			487				486				494				529				559				526				596				628				638				645				608				571
Allowance for loan losses		$	314			$	353			$	365			$	415			$	470			$	434			$	456			$	503			$	520			$	542			$	534			$	498
Allowance for lending related-commitments			173				133				129				114				89				92				140				125				118				103				74				73
Allowance at end of period (a)			487				486				494				529				559				526				596				628				638				645				608				571
Allowance for loan losses as a percentage of total loans (b)			0.60	%			0.70	%			0.62	%			0.96	%			1.13	%			1.14	%			1.26	%			1.37	%			1.54	%			1.46	%			1.41	%			1.32	%

 

(a)	The allowance and provision for credit losses for the periods from the first quarter 2008 through the first quarter 2009 exclude discontinued operations.

 

(b)	Excluding purchase accounting adjustments.

 

Page 19 of 19