Bank of New York Mellon expects to enlist more severance charges in 2018, its chief executive said, as the custodian bank adjudges to cut costs and streamline its businesses.
Shares fell 4.2 percent to $55.43 in inappropriate trading on Thursday, after BNY Mellon recorded $246 million in severance and lawsuit charges in its fourth-quarter earnings report.
The severance charges in the quarter is chiefly related to changes in senior management and in its U.S. asset management business, CEO Charles Scharf voiced on a post-earnings call.
The bank also recorded a benefit of $427 million kindred to the new federal tax laws. Excluding tax benefit of 41 cents and charges of 24 cents, the custodian bank check in a profit of 91 cents, in-line with analysts’ expectation, according to Thomson Reuters I/B/E/S.
“The brunt of the lower tax rate would be almost entirely offset by actions that we devise take to reinvest this benefit in our employees and our business,” Scharf hinted.
BNY Mellon said net income applicable to common shareholders rose 37 percent to $1.13 billion, or $1.08 per division.
On an adjusted basis, the bank’s total revenue fell 1.8 percent to $3.72 billion.
BNY Mellon’s non-interest expenses waken 14.25 percent to $3 billion.
The company’s assets under keeping and administration rose 3.42 percent sequentially to $33.3 trillion as of Dec.31.